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VOL. 122 | NO. 73 | Monday, April 23, 2007

Marketing Push Shows Businesses That Downtown Works

By Andy Meek

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DOWNTOWN WORKS: A new marketing plan will attempt to lure more office users to Downtown. -- Photo Courtesy Of Josh Whitehead

The announcement in February that SunTrust Banks Inc. is clearing out of its 170,000-square-foot space in Downtown's One Commerce Square building - the second-tallest in the city - could be regarded as a setback for Downtown stakeholders.

On the other hand, the move also creates a high-profile vacancy that another company could just as easily view as a prime opportunity. And more than that, it underscores the sense of purpose Downtown stakeholders have attached to a new public relations campaign, one designed to bolster the area's office market.

Making it work

Momentum is building behind Downtown Works, a marketing strategy that will include a rollout of print, TV and radio advertisements, as well as literature that encourages businesses to consider Downtown as a relocation prospect. Print ads already are running and TV spots are on the way.

Sponsors of the effort - which involves the Center City Commission (CCC), as well as other related entities - have purchased airtime on WKNO-FM radio to run ads during the "Marketplace" business-oriented program. TV ads will run on WKNO Channel 10 during the "NewsHour with Jim Lehrer" program.

"We're in launch mode right now," said Jeff Gaudino, vice president of Belz Enterprises, one of five groups leading the marketing push.

The others are the Memphis Regional Chamber, Center City Commission, Parkway Properties and CB Richard Ellis.

A logo has been created for the campaign, displaying the words "Downtown Works" in a rectangular box over a gray and green background. A Web site has been launched - www.downtownmemphisworks.com - that includes everything from a detail-rich Downtown office leasing packet to a map of the area and a comparison of lease rates.

"There's a lot of reasons Downtown might be easy to overlook," said Chris Brown, marketing principal with CB Richard Ellis. "One of the chief reasons is that Downtown is not the central business district, as it is in most cities, because of the linear nature of geography here.

"We're on the far western edge of the city, and so when most of your bedroom communities are east of the city and south and north of the city, it's just a longer drive than a lot of people want to commit to."

Be a part of it

Nevertheless, the Downtown Works campaign represents an attempt to illuminate some of the area's positives. Major Downtown employers like AutoZone Inc., Morgan Keegan and St. Jude Children's Research Hospital, for example, are likely already aware of - because they are surrounded by - the effects of roughly $3.1 billion being invested in Downtown.

The Downtown area has an employee base of about 76,000 people, 1.9 million square feet of Class A office space and an average lease rate per square foot of $16.58, compared to $21.04 in East Memphis, according to the campaign's leasing packet.

Lee Warren, senior vice president of marketing for the Center City Commission, said billboard placements are being considered to further promote the Downtown Works effort.

"It's a well thought out plan," he said, "and something that we hope will further move the needle to encourage and interest companies in locating their business Downtown in available office space."

The problem Downtown stakeholders face is that some companies like SunTrust have pulled out and headed east to be closer to communities where its employees live. SunTrust is relocating to a Boyle Investment Co. office building on Shady Grove Road.

High-class living

On the whole, Downtown doesn't seem to be facing difficulty in attracting new businesses, residents and real estate developers armed with design plans. A few days ago, for example, Westin Beale Street Hotel - the first Starwood Hotels & Resorts Worldwide Inc. property to locate in Downtown - threw open the doors to its plush, high-tech accommodations.

Among other features, the newly opened Westin houses a Daily Grill restaurant, part of the chain operated by Grill Concepts Inc. The new 6,500-square-foot eatery seats 200, serves breakfast, lunch and dinner, and provides room service for Westin guests.

Residential options also continue to multiply Downtown. Earlier this month, a makeover was announced for the Cummins-Midsouth Building at the corner of Georgia Avenue and Riverside Drive that will add new condominium and apartment space to the current mix Downtown.

That $25 million project, dubbed Arthouse, will call for renovations to the building's exterior, basement and first floor, all to make room for new parking and retail space.

Bargains to be found

For whatever reason, the Downtown office market hasn't been seeing that same robust level of activity, although there is some hint that could change soon, partly because of the Downtown Works awareness effort.

"It's really been in the last 18 months or so that East (Memphis) rates have skyrocketed to the point that it's really a bargain down here, even when parking is added in," Brown said. "And construction costs have gone up at the same time, so any new construction out east is going to continue to be very, very expensive.

"Not only that, but there's not a whole lot of new construction and space for new construction out east, so we're pretty hopeful, as leases begin to roll in this new environment, that when it's time to make those decisions, people will consider Downtown as an option."

PROPERTY SALES 64 87 1,429
MORTGAGES 39 60 1,107