Once the settlement of a lawsuit over control of Beale Street is complete, the administration of Memphis Mayor A C Wharton Jr. plans on issuing requests for firms to manage and develop the thriving entertainment district.
Local real estate experts believe interest in managing and developing Beale Street could be high, even though there are distinct challenges that would come with it.
(Daily News File/Lance Murphey)
Local real estate experts believe interest in managing and developing the “Home of the Blues” could be high, but maintaining and growing the famous Downtown entertainment district poses challenges.
The famous artery, recently named America’s favorite iconic street by USA Today, could prove enticing to real estate firms because of its eclectic mix of restaurants and shops and the street’s already well-established brand.
“It’s one of the most famous streets in America and one with more potential to realize than we’ve done in the past,” said Kemp Conrad, a principal with commercial real estate firm Commercial Advisors/Cushman & Wakefield and a Memphis City Council member. “It’s about how we can take what is there and take it to the next level. It’s an opportunity that companies would find very, very, very interesting.”
The area features more than two dozen restaurants and shops offering a broad array of food and merchandise, making the venerable street attractive to a wide range of visitors. Patrons can dine on everything from pizza to barbecue to Cajun and hear a wide range of music, from the traditional blues that helped make the street famous to more modern dance music at Club 152.
“It can be marketed as a mix of clubs and restaurants, and in the middle of that there is some variation, so it’s not just one blues bar after another,” said Danny Buring, partner at The Shopping Center Group LLC. “I think it’s going to be an interesting opportunity.”
Big-time development firms and stars from the entertainment world have previously shown an interest in being a part of Beale Street. In 2009, as the city ramped up a legal fight against Performa Entertainment Real Estate, the company that originally developed and managed Beale Street, over control of the area, a well-known national real estate company was expressing interest in running the entertainment district.
At the time, city Housing and Community Development director Robert Lipscomb appeared to be in discussions with Baltimore-based The Cordish Cos., one of the country’s most well-known urban redevelopment firms, according to a series of emails.
Cordish played a prominent role in the redevelopment of Baltimore’s Inner Harbor. In addition to Baltimore, the company has worked on major development projects in Houston, Charleston, S.C., and Salt Lake City.
The emails also mentioned the financing firm Guggenheim Partners, former Beale Street Merchants Association director Onzie Horne, former Memphis Music Commission head Rey Flemings and Paul Harless, Justin Timberlake’s stepfather.
In the emails, Cordish employees and Flemings were looking for detailed information on Beale Street operations and discussing about scheduling a meeting with Lipscomb.
“How much of the information below can you get us and how soon can we get it?” Flemings wrote to Horne in an email, which included a forwarded email from Chase Martin of Cordish asking for detailed information about Beale Street leases, profits and rents.
Lipscomb said he was never involved in discussions about Beale Street. Rather, he had been talking with Flemings and Timberlake’s representatives about getting the pop superstar and Millington native to invest in Downtown.
In another email, Barry Klarberg of Guggenheim asks Flemings and Martin for more information about Performa and its leases.
“Have we been able to get any more information on the nature of the relationship between the city and the Performa?” Klarberg writes. “What are those leases? Have we seen a P&L?”
John Elkington, president of Performa, said the city will have to seek out individuals like Timberlake and developers with vision if Beale Street is going to survive and thrive.
“You need to be bold on this deal and you need someone who has the vision to take it like we did, from an absolute disaster to an extremely successful project,” Elkington said. “Beale Street is a very difficult project that requires a lot of attention. They need more than a manager. If you’re just paying someone a management fee that would make it very difficult to develop Beale Street and what you really need is an entrepreneur with the vision and talent to make it grow.”
Elkington said that while Beale Street has experienced tremendous success over the last three decades, the entertainment district is facing challenges that could make future management and development difficult.
Reduced air service, a struggling convention industry, a scarcity of hotel rooms and limited space – Beale Street is more than 90 percent occupied – are the most significant hurdles the city and potential development and management firms would have to overcome.
“How are you going to attract more people?” Elkington said. “All those things are how you grow and I see it as being very difficult to grow the way we have in the last 30 years.”