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VOL. 130 | NO. 228 | Monday, November 23, 2015

My HQ Initiative Aims to Boost Downtown Memphis Office Market

By Madeline Faber

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For years, the Downtown Memphis office market has been the same story: Bank A, law firm B and accounting firm C left for East Memphis. The newest buildings are now half-empty as firms, big and small, make their exodus.


To combat the trend, the Downtown Memphis Commission is soon launching a new initiative to draw in the creative firms, young professionals and entrepreneurs that are already attracted to the urban vibe.

“It’s an initiative. It’s not a campaign because it’s much deeper than that,” said Leslie Gower, vice president of marketing and communications for the DMC.

Dubbed My HQ, or My HQ is Downtown, the advertising push is aiming to flip the narrative on what Downtown does well.

“We just want to change the way people are thinking about the Downtown office market,” Gower said. “We're not expecting thousands of companies to be clamoring at our door, but we do want people to know what's going on here because there's a lot of exciting stuff happening that people don't know about, particularly when it comes to the startups and the newer companies that are here Downtown.”

Alex Stringfellow, with CB Richard Ellis Memphis’ Downtown office, has worked with the DMC to give input on what the Downtown office market needs.


“Where we seem to be doing well is the smaller tenants, particularly in Class B buildings, which also include the more historic, renovated buildings,” he explained. “Besides price point and size, they also do well in attracting the creative-type companies that we see Downtown and are doing a lot better in 2015 than they were two to three years ago.”

According to third-quarter CBRE data, the Downtown office market posted 8.8 percent vacancy in Class B office space and 23.3 percent vacancy in Class A.

The average asking lease rate is significantly lower Downtown. Class A comes in at $17.85 and Class B is $13.79, compared to $22.44 for East Memphis Class A and $18.61 for East Memphis Class B.

Architecture, advertising and design firms are drawn to Downtown buildings because of the unique character and environment. Cubicles don’t lend themselves to firms invested in innovation.

“A lot of these companies, they may not be able to pay as well as a corporation could, but if they're able to pay their employees more benefits in terms of environment, they might be able to attract more talent,” Stringfellow said.

Office-related incentives could also be part of the overall strategy. Gower said that her team is evaluating best practices like Chattanooga’s CreateHere initiative, which has used tactical urbanism, talent fellowships and bonuses like subsidized rent to strengthen the urban core.

Several groups in town – including Leadership Memphis, New Memphis Institute and Start Co. –are already doing a great job telling Downtown’s story, Gower said. My HQ will help enhance or promote those recruitment strategies.

For the past five months, Gower has been strategizing with advertising firm Archer Malmo, itself a Downtown-based business, on designing a website and community-wide initiative. As the founder of the popular young professional meet-up Undercurrent, Archer Malmo director Patrick Woods has a good grasp on what the creative workforce is looking for.

Part of the initiative will be launching a new group of Memphis leaders, dubbed Downtown Influencers. Coming from various sectors but finding a home Downtown, the Influencers will animate the Downtown office campus with fun events and projects that build on the environment’s attractiveness.

The website, expected to launch in January, will feature testimonials about why businesses chose Downtown, places to get lunch, an event roster and more.

After the website is live, Gower said the group will launch a My HQ magazine.

Every company, regardless of size, is drawn to vibrancy. Stringfellow believes that the big businesses needed to fill the full-floor, 20,000-square-foot vacancies will follow the creative crowd.

“Hopefully if we can continue to grow the creative workforce Downtown and maintain its uniqueness, the firms that are more corporate in style and nature would start looking down here to tap into that environment.”

PROPERTY SALES 21 82 6,474
MORTGAGES 7 53 4,088
BUILDING PERMITS 240 353 15,714
BANKRUPTCIES 38 58 3,328