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VOL. 129 | NO. 3 | Monday, January 6, 2014

Plans in Works for Dormant Midtown Project

By Amos Maki

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City officials are working on plans to kick-start the dormant Washington Bottoms project at Poplar Avenue and Cleveland Street in Midtown.

Memphis Housing and Community Development director Robert Lipscomb confirmed that he is working on the effort but said he was not yet able to release detailed information on the project.

“Working on something, but not at liberty to discuss right now,” Lipscomb said in an email response to a reporter’s questions.

When asked if his work could revive the project, Lipscomb said, “Yes, for sure.”

A blighted area east of Cleveland Street between Jefferson and Court avenues is part of the original plans for redevelopment in the Washington Bottoms area.

(Daily News File/Lance Murphey)

The current owner of the property, TN Poplar Avenue LLC, in September won approval from the Land Use Control Board to extend the planned development zoning on the site for an additional five years. TN Poplar Avenue LLC is a Delaware-based business that is registered with the state as an affiliate of Lehman Brothers Holdings. The LUCB application also lists Michael Rios, who is listed as a vice president of Lehman Brothers Holdings.

“So, the owners of the (planned development) are marketing this project to potential tenants and are optimistic that they will be able to find key tenants and begin developing this project within the requested five-year time limit,” said an Office of Planning and Development staff report on the extension request.

The staff report also said the city was considering the site for a storm-water detention basin and a fire station. The city of Memphis helped kick-start the redevelopment of Overton Square by investing around $12 million in a three-story parking garage and detention basin.

“There are a number of variables for the future development of this land that cannot be fully addressed here, but the options range from a detention facility that is completely owned and maintained by the city, to a mixed operation that includes a publicly owned drainage facility below ground and a privately owned surface parking lot,” said the staff report.

In 2008, Miami Beach, Fla.-based WSG Memphis LLC, a division of WSG Development Co., filed plans with the Memphis and Shelby County Office of Planning and Development for the 28-acre site bounded by Poplar, McNeil, Court and Cleveland for an ambitious redevelopment project.

Development plans called for a walkable “urban village” including upscale residences, retail, office space, medical office space, a hotel and restaurants.

Land planner Brenda Solomito said in a letter to OPD officials that many of the project’s original goals remain intact.

“The design and intent has not changed since the original approval,” Solomito said. “The goal has always been to provide a pedestrian-friendly center that permits apartments/condominiums and offices above retail shops and on mass transit lines.”

WSG spent several years working on the project, eventually buying dozens of parcels of land in the area in 2007 for $12 million.

WSG took out a $14 million construction loan through Lehman Brothers Holdings but the recession and economic downturn struck, killing the project in its tracks. Lehman Brothers Holdings then took control of the property after foreclosure in 2010.

The site was home to a mix of existing businesses, apartment buildings and low-income homes. After the project collapsed in 2008, the abandoned properties became a blighted eyesore, attracting squatters and criminals. In 2010, Lehman Brothers Holdings began demolishing the vacant buildings there following a series of arson fires.

Danny Buring, managing partner with the Shopping Center Group LLC, said the property presents a unique development opportunity in Midtown.

“There’s not another large piece of property in Midtown like it,” said Buring. “It’s cleared, zoned and has a for sale sign on it. You can’t find another site like it in Midtown.”

Momentum appears to be building along the Cleveland corridor.

Just north of the Washington Bottoms site Crosstown Arts is planning a $180 million redevelopment of the long-vacant Sears Crosstown property.

The Crosstown team is seeking to redevelop the giant 1.5 million-square-foot Sears building, constructed in 1927, through arts, education and health care. The plans also include around 260 apartments and some retail at the 86-year-old structure.

The project includes St. Jude Children’s Research Hospital, ALSAC (the fundraising arm of St. Jude), Crosstown Arts, Gestalt Community Schools, Memphis Teacher Residency, Methodist Le Bonheur Healthcare, Church Health Center and Rhodes College as founding partners that have pledged to be tenants in the redeveloped building.

Construction on Sears Crosstown is expected to start in the spring.

PROPERTY SALES 23 23 1,365
MORTGAGES 21 21 1,068
BUILDING PERMITS 117 117 3,173