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VOL. 121 | NO. 120 | Monday, June 12, 2006

Downtown's Condo/Entertainment Trend Moves East Despite Moratorium

By Andy Meek

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LAND OF OPPORTUNITY: Residents and businesses along Winchester Road - including Deborah Brown, an employee at Your Cleaners - could benefit from a planned 67-acre mixed-use real estate project that Beale Street co-developer John Elkington is helping bring to fruition. Your Cleaners is across Winchester from the proposed Forest Hill Plaza Planned Development. -- Photograph By Andy Meek

The condominium boom that's driven much of Downtown Memphis' residential growth in the past year is stretching beyond the city's redeveloped urban core.

One example is a new project being handled by John Elkington, CEO of Performa Entertainment Real Estate Inc. He's working with a Chicago-based development firm that wants to transform 67.2 acres of prime real estate on the eastern fringe of Memphis into an upscale retail and entertainment destination with condos.

The Forest Hill Plaza Planned Development, first made public at the end of April, will include 600,000 square feet of retail and commercial space. A 300-room hotel and pier will overlook a lake on the property, which lies at the southwest corner of Winchester and Forest Hill-Irene roads. And the zoning also is in place to allow residential units - possibly condos, Elkington said - above the retail spaces.

Red light, green light

But the condo portion is on hold, at least for the time being, thanks to a residential development moratorium Shelby County leaders OK'd in recent weeks. The ban is actually an extension of a moratorium on residential projects in the unincorporated parts of the county that first was approved for six months last October.

The extended ban will stay in place until July 31.

In some ways, the results of the moratorium have been something of a mixed bag. County leaders never completely pulled the plug on closing off part of the county to residential development - any building projects already in the pipeline were exempt.

And while some feared the ban would send builders scurrying into neighboring counties looking for development opportunities, Elkington - one of Memphis' most influential real estate developers - nevertheless is going about business as usual.

"We think it's a great site," he said of the property, which was purchased from landowner Charles Wurtzburger, the businessman who founded the wrapping paper company Cleo Wrap Inc. in the 1950s.

"You have, within a mile, an average household income of $125,000 per household, and within three miles it goes to $94,000."

The surrounding land includes Windyke Country Club, an office building and apartment communities to the west. Christ the Rock Christian Academy and Forest Hill Baptist Church sit immediately to the north. Elkington currently is helping line up tenants for the project, which is being developed by the Chicago firm Landmark Properties.

Life is a highway

The site is close to major highways and Interstate 240, and though it currently lies in the unincorporated county, the City of Memphis is due to annex the land in 2013. Both of those are factors that had made Elkington envious of the property's potential for a while, residential development moratorium or no.

Elkington is well-known as the co-developer and manager of Beale Street, but before that, he built homes in Germantown and East Memphis. And what he sees now in the nearly 70 acres at the edge of Germantown is the need for a full-service hotel, as well as upscale shopping.

"What's in Collierville is like what is in any other mall in America," he said.

That's one of the reasons Forest Hill Plaza is a signature project. In April, home builder Terry Dan told the Shelby County Commission a moratorium wasn't fair to the homebuilding industry. County Commissioner John Willingham said the ban "put a hex" on county property owners.

Yet in that same region, Elkington envisions a large, high-end commercial and office development with national tenants. In a staff report, the city-county Office of Planning and Development notes the project also will be a financial boon, capturing some of the money that otherwise would have flowed to shops in Germantown.

"We think, with Southwind and the other areas that are immediately adjacent to it, there's a group of people who I think would appreciate what we're trying to do," he said. "They certainly would be our customers. And this would be the closest center to Germantown outside of Saddle Creek."

Reasons behind reasons

Even if Elkington's colleagues recently have begun souring on development in the county, it may not necessarily be because of the moratorium. Allen Medlock, the head of Memphis and Shelby County Construction Code Enforcement, said there just isn't that much available land in Shelby's unincorporated stretch.

"There's actually quite a bit left, but a lot of it is in the floodplain and things like that," he said.

Neighbors who've heard about Elkington's giant project have been generally receptive. Doyle Silliman, president of Windyke Home Owners Association, said the development has not generated much in the way of points of contention.

"What we're looking at is making sure it's developed in such a manner with the signage, lighting, landscaping and all to be compatible with the area, and what they've presented so far appears to be so," he said. "We're concerned a little about the height of the hotel, but not too much."

Landmark Properties is a national developer that scours the country for land in high-income areas. The company approached Elkington's firm in the past about collaborating on a project in Mississippi, which was turned down.

After a few more tries, the pair of real estate companies found a development opportunity in a section of Shelby County that has been partially closed off to development in recent months, to the chagrin of the local industry.

"Our goal is to have site work under construction in the fourth quarter of this year and then to develop it in 2007," Elkington said. "And hopefully we'll open it in fourth quarter of 2007."

PROPERTY SALES 157 157 10,093
MORTGAGES 161 161 11,107
BUILDING PERMITS 229 229 22,402
BANKRUPTCIES 54 54 6,365