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VOL. 129 | NO. 9 | Tuesday, January 14, 2014

Property Struggle

Economic factors appear to spell demolition for the Tennessee Brewery

By Andy Meek

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Discussions are underway about the particulars of an imminent demolition contract for the Tennessee Brewery, and the owners of the castle-like structure Downtown could decide the property’s fate by sometime in February or March.

That’s according to Rasberry CRE principal James Rasberry, the commercial real estate broker who represents the brewery’s owners. But he adds that a demolition contract is likely to include an important caveat: There would be no immediate razing of the brewery, in the hopes that someone with a plan will emerge to save it.

The Tennessee Brewery building in the South Main Historic Arts District has proven to be a challenge for redevelpment. Discussions are underway for what could be its demolition. 

(Daily News/Andrew J. Breig)

“If someone doesn’t come forward, we’ll probably go ahead and demolish it,” Rasberry said. “We got close a few times. If we couldn’t get it done in 2005, 2006 without help, it’s probably not going to happen now. It’s costing us every month just to plug holes there, where kids who think it’s a playground are in there tearing things up. (The owners) bought the property back in 2000, and it’s cost them several hundred thousand dollars to stabilize it and get code enforcement to let them keep the building.

“They’ve lost money for 13 years since the acquisition, and there’s a point in time – as much as I’d like to do something nice, there’s a point in time where I can’t have someone continue to lose money just because I might happen to like looking at that building. This land is good land and could be anything, but at least we’ll not be dealing with X dollars a month and all the potential liabilities associated with it.”

Paul Morris, president of the Downtown Memphis Commission, strikes a similar note, saying that it’s “simply economics” that has prevented any of a handful of developers over the years from successfully remaking the brewery. For years, a variety of developers have come up with concepts that included turning the brewery into everything from condominiums to a hotel – and each time, they’ve tended to run into what Morris describes as daunting math.

The brewery, for example, doesn’t have much in the way of developable land. With less than an acre, previous concepts have struggled with how to design enough residential space to make any project financially feasible.

“The costs of rehabilitation and redevelopment well exceed the likely investment return,” Morris said. “And the carrying costs of the building, including insurance, taxes, security and stabilization, are very burdensome on a commercial property that is producing zero income.

“I hope some who are demanding preservation come forward with some cash to cover the carrying costs. It’s not fair for the burden of preservation to fall on a single private party. And I certainly hope someone finds a way to redevelop this historic building, as it would be a terrible shame to lose it, and it would also be a terrible shame to let it continue to rot unoccupied.”

Those “demanding preservation,” in Morris’ words, would include June West, executive director of Memphis Heritage Inc. She’s emphatic that Memphis is replete with old buildings like the brewery “that can be warehoused and secured.”

“I think there is a creative plan out there that can meet the needs of that building. It just hasn’t been discovered yet,” West said. “I really feel like this is opening up an entire dialogue for people who perhaps hadn’t thought about it.”

The brewery, listed on the National Register of Historic Places, is a visual wonder, built with wrought-iron railings that line the staircase inside and, on the outside, presents visitors with an imposing façade. It was founded in 1885 by three men, one of whom came from a family in Germany that had brewed beer for 500 years.

Architectural historian Judith Johnson once insisted to The Daily News that the brewery is the “most spectacular 19th century building in Memphis.”

Said Rasberry: “It’s not that anybody wants to tear it down. It’s a financial decision. It has nothing to do with emotions. There comes a point in time where you’ve got to think rationally about this.”

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 72 206 16,619
MORTGAGES 84 228 21,660
FORECLOSURE NOTICES 21 56 4,322
BUILDING PERMITS 0 209 39,587
BANKRUPTCIES 73 222 15,764
BUSINESS LICENSES 23 51 5,542
UTILITY CONNECTIONS 86 287 23,860
MARRIAGE LICENSES 21 72 5,107

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