The Prosper Arts District development agreement sets a June 11, 2029, deadline for the developer to obtain a town building permit for Hotel Carbon, the XO2 Tower or the Mixed-Use Parking Garage. If none is issued by then, the agreement becomes void and the town may initiate rezoning, according to the development agreement.
Agreement terms and site constraints
The agreement also bars several kinds of businesses from the property, including package liquor stores, smoke or vape shops and pawn shops. It requires a parking garage; for visible portions in the Mixed-Use Zone, the garage must receive compatible architectural treatment, which may include cladding, murals or other artistic features, according to the agreement.
Floodplain revisions are another site constraint. Community Impact reported that a larger area in the southeast corner must be reserved for detention and drainage, based on a Capitalize Ventures map. The outlet also reported that two prospective investors—one from the United States and one from Korea—were reluctant to proceed because of the structured-parking requirement. Prosper’s council updated its zoning ordinance in April 2026 to require structured parking for multifamily developments, Community Impact reported.
A phased approach
Capitalize Ventures owns the land and is now pursuing separate project components with multiple partners, rather than depending on one developer for the entire development, according to Community Impact. The company’s first proposed component is retail on the site’s southwest corner, at Prosper Trail and Shawnee Trail, a location consistent with conceptual plans approved by Prosper Town Council in 2024.
Community Impact reported that company co-founder Krishna Nimmagadda described a boutique grocery store, coffee shop and family entertainment venue as possible tenants, not confirmed occupants. The company has identified partners for the retail component, is seeking partners for a multifamily component and has had preliminary discussions with a hotel interested in the site, the outlet reported.
How the project reached this point
The development was initially expected to break ground by the end of 2024, according to earlier reporting cited by Community Impact. In its 2026 report, the outlet said the developer previously expected to build the project lost its financing and its option under a land contract expired in early 2026. Community Impact also reported that the floodplain work had delayed construction.
The retail plan is being developed with Prosper town staff. Nimmagadda and Prosper Development Services Director David Hoover estimated to Community Impact that approvals for the shopping area could take about six months, while noting the timing could change. The broader project’s progress will depend on its separate components and the partners Capitalize Ventures secures, according to the outlet’s reporting.
