VOL. 128 | NO. 240 | Tuesday, December 10, 2013
Crosstown Effort Shines as Development Example
By Bill Dries
Construction documents for the $180 million revitalization of the Crosstown building were scheduled to be finished Friday, Dec. 6, with the project moving toward closing and construction in the next months.
The detail work is the aftermath of several years of work behind the scenes as well as in the public and political arena by partners in what began as a longshot bid to bring back to life a 1.5 million-square-foot building that was shuttered in 1993.
It follows last week’s approval by the Memphis City Council of $15 million in city funding that was the last piece of the financing puzzle.
“We’re all running a race and there’s eight to 10 people in the race,” said Todd Richardson, a co-founder of the Crosstown Development Project, on the WKNO-TV program “Behind The Headlines.”
The program, hosted by Eric Barnes, publisher of The Daily News, can be seen on The Daily News Video Page, video.memphisdailynews.com.
“We are just looking over our shoulders making sure that everybody’s moving at the same pace toward the finish line,” Richardson said, referring to banks lending the majority of the money for the project as well as tax credit consultants. “The city investment was the last big piece for them to say we can now justify starting work and structuring the deal and the development – all of those things to be able to start construction in the spring. … The uncertainties are less.”
The city’s funding “goes toward preparing the site for us to do the work we need to do,” Richardson added.
After watching the hostile reception the proposal for the city to buy AutoZone Park got during the same council committee session last week, Richardson and other partners in the Crosstown effort were concerned some of the hostility might spill over to their project.
And the concerns were justified given the high level of importance timing can have in political decisions.
But council member Lee Harris, also on the program, said the efforts were very different, not only in their impact but in the preparation. Council members were looking at a stark contrast.
“All the “I’s” are dotted and all the “Ts” crossed. I don’t think there’s a council member who’s not been invited to a presentation with respect to Crosstown,” Harris said, adding he had four briefings on Crosstown before it came to a final vote this month. “The last one I turned down because I had too much information.”
Several council members wanted to know who owns the property currently, something the developers had not disclosed previously at the request of the owners.
City Housing and Community Development Director Robert Lipscomb defended maintaining the anonymity even from the council members about to vote on $15 million in funding, which included local dollars as well as state and federal grant and bond money.
It was Richardson and co-leader McLean Wilson who huddled as Lipscomb and the council sparred and made the decision to tell the council. The property is owned by Elizabeth and Staley Cates, president and chief investment officer of Southeastern Asset Management Inc. The couple bought the property in 2007 and is donating it to Crosstown LLC with all profits to go back into the development.
With the disclosure including the condition, council members had no further questions about it.
By contrast, Harris likened the city’s rushed presentation of the ballpark deal to “putting a steak on a garbage can lid.”
“The community benefit part of it was an afterthought,” he said of the project, which was to go to a council vote at a special meeting Monday, Dec. 9.
Harris was one of several council members who weren’t impressed with the administration’s claim of an end-of-the-year deadline for the ballpark deal to be done.
“Most of these deadlines are invented deadlines,” he said. “They are somebody else’s deadlines and they are not real. They don’t apply to us trying to make good decisions about how to spend city resources.”
Richardson and the other partners crowded the council committee room and later the council chambers with Crosstown supporters who cheered so loudly after the vote that the council members had to re-enter their votes in the city’s sometimes temperamental electronic voting system.
Richardson said it helped that he had support from leaders of the surrounding neighborhoods and details of spin-off development already taking shape including plans for an enhanced Jackson Avenue business corridor as well as new residential development in North Memphis.
He cited 875 net new jobs once Crosstown reopens in approximately two years with eight major tenants generating $1.5 million annually in sales taxes.
“That’s going to catalyze around that building,” Richardson added. “This is a case study for how to do development right in the city. I hope it can be an example for what is to come.”