The Edge District has been attracting increased attention in recent years as a place with an eclectic mix of commercial and residential along with art, performance, and dining spaces. In large part, it’s because it’s on the edge of downtown and the Medical District, both of which are expanding.
It got into high gear last year thanks to planning and acquisitions by Development Service Group (DSG), headed by president and CEO Gary Prosterman. He’s helmed several enterprises in healthcare and real estate, not only in Memphis but in Philadelphia, Tampa, and Houston.
At a recent Rotary Club lunch presentation, he spoke about the Bakery Apartments & Edge Redevelopment, a $73 million project of six parcels in the Edge District, including the old Wonder Bread Factory at 400 Monroe, and the former Memphis Cycle Supply at 421 Monroe. It includes 286 apartment units on the site of the Wonder Bread Factory, and more than 155,000 square feet of retail, office, and mixed-use space spread throughout the development.
Over the years, Prosterman was bothered seeing tourists walking from, say, The Peabody up Union to Sun Studio, a stroll with some pretty shabby sights and leaving a poor impression to visitors. He felt it had to be better and, as a fourth-generation Memphian, he realized he could bring historic insight as well as present capital to improve the area’s future.
“My great-grandfather came here, worked on the sugar boat from New Orleans in the 1890s and eventually, he was one of these hardworking guys that saved all his money,” Prosterman says. “He opened a small tavern down on the riverfront and he opened a hotel.” The family had the Tennessee Hotel across the street from The Peabody, now the Doubletree, as well as the Adler Hotel across from the Chisca. In the late 1960s when downtown was fading, his grandfather lost those hotels. “We’ve kind of come full circle,” he says, “as I’ve now been able to come back and do some of these things.”
One such contribution was The Chisca Apartments in the South Main Arts District, a rescue of the historic Chisca Hotel that was built in 1913. It closed in the 1980s and became an eyesore. The city proposed to demolish the property in 2011, but DSG acquired it, and the redone Chisca has 161 apartments, garage and surface parking, and two restaurants, Lyfe Kitchen and Catherine and Mary’s. Another significant project was the office tower revitalization of One Commerce Square. DSG was in on the $7.6 million acquisition and managed the $20 million renovation of the downtown Memphis landmark. DSG updated major systems in the 465,000-square-foot building and created the city’s first LEED-certified downtown office tower.
So when the Wonder Bread Bakery site came up for sale a few years ago, Prosterman saw an opportunity that went far beyond fixing it up. DSG got with investor Worthington Hyde Partners to buy it. “And then we quietly acquired a number of pieces of property around there,” Prosterman says, “so that we assembled, in total, about 10 acres in what is known as the Edge District.” The district is generally defined as the area from Danny Thomas on the west to Health Sciences Park on the east, and from Beale Street on the south to North Parkway on the north.
Putting his attention and resources to developing the Edge District was a natural extension of what DSG had been doing. “In about 2005, we shifted our focus to working predominantly in the urban core, and predominantly focused on doing adaptive reuse of existing buildings,” Prosterman says. “But there are a lot of reasons we chose to do this. Among them are the economics, study of demographics and trends, as well as noticing what was happening with the shift in populations.”
He says the urban core is particularly important to development in Memphis. “You have to realize that every city is competing for talent,” he says, “and particularly the Medical District, where we’ve got intellectual capital, so we’ve got to position ourselves so that we offer choices, that we offer the best. Cities throughout the country are competing for intellectual capital, and while I’m not so naïve as to believe that the only thing that matters is offering vibrant live-work-play communities, it is something that matters greatly, particularly to the younger population.”
And that younger population is redefining what developers need to focus on. Prosterman cites the book The Great Inversion and the Future of the American City by Alan Ehrenhalt. “There’s really an inversion of demographics that, if you study these things, which those of us in development do, you can see this trend happening,” he says. “We’ve had so much of change for multiple reasons. What’s happening with the younger cohorter is that they are delaying having children longer, if they have them at all. They’re delaying marriage longer, if they get married at all, and so you have these very compelling data points. At one time, Baby Boomers who were married with children comprised 50 percent of households. Today that’s 25 percent. That’s an amazing shift in numbers. We’ve learned that the combination of that shift happening with the younger cohort at the same time that those of us who are Baby Boomers are now empty nesters; many of us are returning to these live-work-play walkable communities. And you now have this conversion of demographics which is creating a lot of demand throughout the country for the housing stock returning to urban core.”
But, he says, the housing that’s available in the Edge District is old, “with the exception of the Bristol Apartments, which is 14 years old. All the other housing stock was built in the 1960s and 1970s.”
Prosterman says the Medical District is particularly important to Memphis because of the jobs. “This is probably the number one thing for our city that would help us cure the issues we have,” he says. “And the number one job machine we have — probably it’s too much of a secret — is our Medical District. If you’ll look at these data points, we currently have 17,000 full-time employees in the Medical District. In addition to that, we’ve got 10,000 full-time students. So in the population every day, you have 27,000 people in the Medical District and when you combine that with the people in our downtown, it’s a population of 81,000 people that are working in between downtown and the Medical District. So we have 81,000 people that we need to serve, that we want to make it an area of choice, from the housing perspective.”
He says that of the 17,000 people who work in the Medical District, only 2.7 percent live there and of those 10,000 students, only 6 percent. “We think this is a matter of choice,” he says. “We’ve got to improve our community to make it desirable.”
A key organization to promoting those improvements is the Memphis Medical District Collaborative, a community development group that has partnered with several healthcare and academic institutions in the area. They include Baptist College of Health Sciences, Memphis Bioworks Foundation, Methodist Le Bonheur Healthcare, Regional One Health, Southern College of Optometry, St. Jude Children’s Research Hospital, Southwest Tennessee Community College, and the University of Tennessee Health Science Center.