Developers finishing construction on downtown Dallas' historic Statler Hotel have broken ground on a mixed-use project a block away.

The development at Harwood and Jackson streets will include more than 800 parking spaces in a garage, ground-floor retail plus residential units. Construction on the project will take about a year, developer Mehrdad Moayedi said.

The parking garage will be underground with about six floors of residential space on top. The building is across the street from a planned park on Harwood.

"We are doing six or seven apartments facing the park with little courtyards," Moayedi said. "There is going to be 140 condos for sale on top.

"We feel like facing the park, a lot of people will want ownership."

Moayedi said the condominiums will sell starting at about $350 per square foot. Frontier Bank is financing the project.

Construction has started on a garage, retail and residential building next to the Statler project on Harwood Street. (Steve Brown / Staff)

The developer is keeping the vacant corner of Commerce and Harwood for another project.

"We are going to build an iconic office building right on the corner," Moayedi said.

Construction starts on the garage and residential building just as work is finishing up on the $230 million redevelopment of the almost 60-year-old landmark hotel.

Moayedi's Centurion American Development has spent 30 months converting the vacant 19-story Commerce Street hotel into a combination of apartments, hotel rooms and retail space.

The first of 159 hotel rooms will be ready Oct. 17. Hilton will operate the hotel as part of its Curio Collection.

"We will have a soft opening," Moayedi said, giving a tour of the building. "We'll not be completely opened up until the end of November."

The first tenants have started moving into more than 200 apartments in the building.

"The residential is open and we have about 110 leases so far," Moayedi said. "We will be at 50 percent very quickly."

Work crews are finishing the public areas of the hotel, and the ground-floor restaurant was experimenting with menu items Tuesday morning. In the second-floor grand ballroom, work is wrapping up on the sound system and ceiling. The parquet wooden floor was restored.

"It would be cheaper to put new in," Moayedi said. "We restored the elevator that used to bring cars from the street up to this ballroom for auto shows. That was a real challenge."

A rooftop bar and swimming pool is still under construction but should be finished by late next month.

Along with the rooftop watering hole, there's a ground floor sports bar with four bowling lanes.

"We have pool tables, pingpong tables and foosball there," Moayedi said. "There's a big kitchen in the back."

The Statler project, the largest redevelopment in Dallas' history, has stretched longer and cost more than originally anticipated.

"With these historic buildings, there is constant change," Moayedi said. "When you think you have it figured out, it changes. Even with the headaches, we are proud of it."

The Dallas Morning News is moving its operations into the former Dallas Public Library building that's part of the Statler development.

The long-awaited project has gotten attention from federal investigators who are looking into bonds that were issued to help fund the deal.

The IRS has ruled that $26.5 million in bonds issued with the project do not qualify for tax-free status. The bond underwriters are appealing the decision.

The project also has spawned litigation from partners and former managers.

"It will be a great weight lifted when this development is done," Moayedi said. "People like to sit on the sidelines and make accusations. Getting this done is another story."