VOL. 130 | NO. 72 | Tuesday, April 14, 2015
Universal Life Building Developers Acquire Key Public Financing
By Amos Maki
Developers of the Universal Life Building have received approval for two key pieces of financing and a commitment from the city of Memphis to lease about half of the building.
Self-Tucker Properties LLC, which is redeveloping the Universal Life Building for office use, was approved Tuesday for two key pieces of financing and a commitment from the city of Memphis to lease half of the building.
(Center City Revenue Finance Corp.)
Self-Tucker Properties LLC won approval Tuesday, April 14, for a nine-year payment-in-lieu-of-taxes agreement from the Center City Revenue Finance Corp. to renovate the building for office use. Architects Jimmie Tucker and Juan Self, principals of Self-Tucker Architects, also gained approval for $2 million in Qualified Energy Conservation Bonds for the project.
Self-Tucker intends to develop 25,482 square feet of leasable space, including the two floors and part of the basement, in a $6.2 million project. The PILOT could stretch to 10 years if the developers meet energy conservation standards or install public art or lighting.
Self-Tucker Architects will lease 20 percent of the space for its new offices, and the remainder will be available for other tenants.
The largest tenant in the building will likely be the city’s Renaissance Business Center, which is supposed to serve as a “one-stop-shop” development agency for small and minority-owned businesses. Memphis Housing and Community Development director Robert Lipscomb said the RBC would relocate from its current location at 555 Beale St. and lease 13,000 square feet at the Universal Life Building.
“We think it’s one of the most important projects in the city of Memphis,” Lipscomb said. “Even though it’s small, we think it’s really important because we have to start making a statement about inclusion and diversity and we think this project makes that statement.”
Self-Tucker bought the historic building on the northeast corner of Danny Thomas Boulevard and Linden Avenue in 2006 and had a previous PILOT agreement with the CCRFC. It sought an extension for that agreement in 2007 as the effects of the Great Recession began to make financing of such projects difficult.
“Quite honestly, this has been a very challenging project over these 10 years we have owned the building, so we feel very fortunate that the stars have aligned and we’ve had continued interest in the project and people have come forward with innovative ways to move this project forward,” Tucker said.
Tucker said it became impossible to acquire financing in the wake of the recession. However, the development team has maintained contact with possible tenants and now is ready to move forward.
“It’s really crucial to be able to have a specific start date and know we have the funding in place,” Tucker said. “We have been somewhat reserved about having a lot of discussion about the project because it has been a project that over time has had fits and starts, and so we wanted to make sure we were ready to move forward and even revive some of those discussions.”
Getting the project back on track required creative financing, Tucker said.
In addition to the PILOT and energy conservation bonds approved Tuesday, the development team is seeking a $300,000 development loan from the Center City Development Corp. on Wednesday, April 15. The project received a $1.9 million grant from the Memphis Green Communities grant program, $600,000 in city “infrastructure construction funding” and a city predevelopment grant of $482,282. First Tennessee Bank will provide a $1.8 million loan, and the development team is investing $595,492.
“Everything is contingent upon everything else,” Tucker said of the financing. “Every time we are successful, it just gives more credibility to the project.”
Tucker and Self are both African-American, and the Universal Life Insurance Co. and the building played large roles in the black community for decades.
Built in 1949, the two-story building was the headquarters of Universal Life Insurance Co., which was launched in 1923 and grew into one of the largest black-owned life insurance companies in the U.S. Founded and headed by J.E. Walker, the company also was a pillar of the local African-American community in the era of racial segregation by law.
The Egyptian Revival-style building at 480 and 504 Dr. Martin Luther King Jr. Ave. has been vacant since 2001. It was added to the National Register of Historic Places in 2007.