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VOL. 125 | NO. 233 | Wednesday, December 1, 2010

Highland Family Dollar Could Spur Area Development

By Sarah Baker

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A recently approved plan for a Family Dollar development on Highland could very well set the tone for peer retailers looking to come to the area.

Marketplace Development LLC purchased the northeast corner of Highland Street and Spottswood Avenue for $525,000 for a proposed freestanding 8,100-square-foot Family Dollar Stores Inc. development. A $1.2 million construction loan was taken out at the time of the sale.

Matthews, N.C.-based Family Dollar purchased a former gas station/convenience store owned by Tempe, Ariz.-based Circle K Stores Inc., which purchased the property in December 2005 for $650,000, but has vacated the area in recent times.

Circle K’s broker was Ed Garey of Century 21 River Oaks Masselle. Shawn Massey, partner with The Shopping Center Group LLC, was the tenant’s broker. J. Wise Smith & Associates was the developer, architect and contractor of the project.

Memphis-based Marketplace Development began work on acquiring a site in the area at the end of 2009, but was met with a number of obstacles.

Initially there were environmental concerns with purchasing the former gas station, which was built in 1990.

Josh Whitehead, planning director of Memphis and Shelby County Office of Planning and Development (OPD), said Family Dollar’s development is a great site plan on a difficult site.

“Any time you have a former gas station, it’s just another step – whether it’s environmental cleanup – a lot of stuff that a lot of other sites don’t have to deal with,” Whitehead said. “With as a competitive of a market as you have now, it’s a buyer’s market, and it’s just one more thing to discourage a buyer.”

But because Family Dollar looks for a minimum of 8,000 people in its trade area, the Highland area was ideal.

Wise Smith said his firm was about four months behind the adoption of the University Overlay District, which sets up zoning as a neighborhood center as opposed to the normal zoning ordinance set forth by Memphis and Shelby County. Instead of having parking available in front of the store, the lot will be to the northern and east side rear.

“It kind of turned everything around,” Wise said. “It requires the buildings to be built up on the street, with all of the parking in the rear, which doesn’t fit Family Dollar’s model or prototype, so it was really difficult to balance Family Dollar with the new zoning ordinance, but we suffered through it and got it done.”

The new zoning guidelines are part of a plan for the University District Overlay (UDO) – prepared by the OPD and the University Neighborhoods Development Corp. – to engage the street and sidewalks with more foot traffic from the campus and the surrounding neighborhoods.

Because there is no on-street parking on Highland, and this location on Spottswood has a left turn lane with no on-street parking, the entrance to the Family Dollar will be on the corner.

Whitehead said he was sympathetic to retailers’ need for potential customers to see the available parking as they drive by, calling parking “a necessary evil.” But Family Dollar accommodates not only vehicular traffic but also pedestrian traffic.

“I think this is a commendable site plan and it’s somewhat going to be looked upon by other retailers to see if this site is a success or not,” Whitehead said.

The new Family Dollar comes before the proposed Poag & McEwen Lifestyle Centers-Memphis LLC’s $70 million Highland Row project next to the University of Memphis campus and CVS/pharmacy’s recent announcement to place a store at Park Avenue and Highland.

“This will be an excellent addition to the neighborhood by cleaning up an abandoned service station and continuing the resurgence of this area,” Massey said.

Construction for both the Highland Row project and Family Dollar are set to begin in 2011. Family Dollar expects to have a spring 2011 opening.

But Wise – whose firm recently completed the Family Dollar store at Sycamore View and Pleasant View Road – said his decisions were not based on other projects in the Highland area.

“I really did not predicate my going forward with it based on anything that’s going to happen up and down the street,” Wise said. “I think anything that happens will enhance my property value.”

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 94 494 11,526
MORTGAGES 99 552 13,427
FORECLOSURE NOTICES 0 45 1,858
BUILDING PERMITS 135 926 24,165
BANKRUPTCIES 63 276 7,473
BUSINESS LICENSES 23 106 3,912
UTILITY CONNECTIONS 39 181 4,681
MARRIAGE LICENSES 10 74 2,544

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