In a city’s history, there are times when it all starts coming together. We’re now in a time when the economy is strong and there’s a sense of change in town, a good sense. Young people are coming here and changing not only how we work and live, but where we work and live. There’s an entrepreneurial spirit that’s proving to be a fertile ground for innovators who see opportunities all around.
It’s not all blue skies and sunshine. Take a look at David S. Waddell’s Finance & Investment column. The Memphis Metropolitan Statistical Area has an unimpressive rate of population growth. Household income is declining. The city’s economic growth pales in comparison to other Tennessee cities. Waddell identifies systemic practices that seem to be hampering us and calls for changes.
Still, there are opportunities, and in the area of real estate and neighborhood development, some impressive projects are happening, either near completion or just getting under way. If some of the numbers seem discouraging, there’s still a sense of Memphis moving forward with gusto. And maybe, the economy willing, it’s a harbinger of greater things to come.
We spoke with Jennifer Oswalt, president and CEO of the Downtown Memphis Commission, about what’s going on. While DMC is primarily focused on downtown, of course, Oswalt says that projects outside its area are meaningful to DMC’s work. “We feel like it is all intertwined,” she says. “For example, if the city is trying to recruit or keep a national or international company, then that company has to be able to fly in and out and fill its workforce and then the spouses of that workforce have to have a place to work and they want to have an enjoyable place to live.” Similarly, the improvements at Memphis International Airport are important for recruiting companies, getting new flights, and attracting carriers.
Oswalt’s downtown portfolio includes several developments we’re focusing on in this issue of Inside Memphis Business. Overall, Oswalt says, “In the last five to 10 years, we’ve been really focused on residential and growing the number of people living downtown because we feel like that will drive other investment in retail, grocery, and so forth.” She says that has proven to show it attracts businesses to downtown because employees — especially younger ones and empty-nesters — want to live and work nearby. “So that’s been our strategy and we continue to focus on that right now because we don’t feel like we’re done with that yet.”
Also on the priority list is filling downtown’s hotel requirements. “We have a great amount of small hotels, but we don’t have a really large one that can take a good size group, which hurts our convention center,” Oswalt says. “We have a very high capacity with our [existing] hotels, which shows that we can handle more. So we’re looking at that heavily to coincide with the convention center renovation.” (As we went to press, the city signed a letter of intent with Loews Hotel Holding Corp. and THM Memphis Acquisitions to redevelop the empty 100 North Main building into a convention center hotel of at least 500 rooms).
If residential is the top priority, it’s also part of the DMC’s mission to make the most of other properties that could be mixed use. “We want to fill the gaps on buildings that are sporadically throughout the core of our downtown that could be either residential or office,” she says, “hopefully a mix of some ground floor retail and office or residential on the upper floors.” Oswalt cites the Hickman Building, also known as the Medical Arts Building, as an example. It’s a $16 million adaptive reuse as a mixed-use development with offices, apartments, and retail space. The eight-story, 100,000-square-foot building at 240 Madison was vacant since 1971. Walk-Off Properties LLC, headed by Michael W. Cook, acquired the building and an adjacent two-story parking garage in 2015. Cook is founder, CEO, and CIO of SouthernSun Asset Management, which will be the primary tenant.
We take a look at the $55 million Central Station redevelopment that involves creating a 135-room boutique hotel and commercial space, expansion of the Power House into a seven-screen Malco theater, three new apartment complexes with more than 200 units, and a reconfigured Farmers Market with more vending space.
Oswalt says it’s a great example of adapted reuse and a great amenity. “It’s been a long-time wish of the community,” she says, “and it also blends our tourist population that might be arriving at Central Station, staying in that hotel, with an authentic neighborhood. We think the transportation side of it is key in that MATA is enhancing their station right around there for the trolley, the bus station is going to be nearby, and then you have the train. Also, it’s an easy access point for the riverboats that come into town, so tourism is integrated into our fabric of our community. And with the other new hotel coming at 477 South Main, which is the old Memphis College of Art building, that will be another opportunity for the same thing.”
“That one is definitely catalytic in the same way that the Tennessee Brewery is because of the adaptive reuse,” Oswalt says, “which we think is something that will keep Memphis authentically Memphis in its smart growth. That one really is unlocking a whole neighborhood and shortening the distance between the core of downtown and the Medical District. So it’s really filling a big gap for us, unlocking a lot of potential. It’s making the path to the ballpark short and giving us the advantage to work on Union Avenue and also Monroe to make it more of a pedestrian path as well. It’s a good example of a way for us to work on the connections between our neighborhoods. And it’s a great mix as well.”
Across Union from that redevelopment is the recently sold structure built for The Commercial Appeal. “That is seen as one of the few big pieces of property left that could be any number of things,” Oswalt says, “but I do think residential is probably at the top of the list. I’ve heard it could be a big office, but given the need that the Medical District has, there are incentives in place with the hospitals and schools to live where you work or go to school and there’s just not enough supply. I do think it’s a high likelihood.”
One of the more ambitious proposals is for One Beale, an idea that has been out there for a while but hasn’t gotten off the ground. Recent developments with the Carlisle Corp. and its recent partnership with Highwoods Properties indicate it’s back on track with some changes. “They’ve required a little more land than they originally had,” Oswalt says. “I think they’re in good shape to move forward this year with substantial progress. I think they’re in a good place right now and we’re working with them to try to keep the Ellis buildings on Front Street intact and build around them for a really nice public space. And they have been interested in talking with Carol Coletta and us, thinking about a good way to connect to the river at that spot.”
We have an interview with Coletta where she talks about her vision for the recently renamed Memphis River Parks Partnership, which could turn out to be the most important and integrated change to the riverfront in the city’s history.