VOL. 132 | NO. 152 | Wednesday, August 2, 2017
Wonder Bread Factory Rebirth Eyed by Chisca Hotel Developer
By Patrick Lantrip
A new plan submitted to city officials would breathe new life into the former Wonder Bread factory that used to fill the Memphis Medical District with the smell of fresh bread before it closed in 2013.
A group of investors spearheaded by Chisca Hotel Developers – Development Services Group – has submitted a $73 million plan to create 286 upscale multifamily units, a 480-space parking garage and 150,000 square feet of office and retail space.
“The 2013 closure of the old Wonder Bread Bakery, which once employed 250 people, dealt a heavy blow to the remaining neighborhood establishments, DSG vice president of development Ethan Knight said in a letter of intent. “However, the Edge is a key location to continue the success of urban development that Memphis has enjoyed over the past 30 years.”
To offset set the construction costs, Development Services Group is seeking a 20-year PILOT from the Center City Revenue Finance Corp.
“This aggressive project is simply not possible without relief of the excessive tax burden placed on new construction,” Knight continued. “A PILOT is required in order to secure financing, and a partnership with the Downtown Memphis Commission is the only way to make this project possible.”
Knight added that the project would increase the city’s tax revenue by more than $6 million over the course of the PILOT.
In addition to DSG, Worthington Hyde Properties and SWH Partners joined together to form PGK Properties, which will be the entity tasked with handling the project.
“We are in late-stage negotiations to fill over half of the office space with exciting tenants, and we are confident in the Downtown Memphis multifamily market’s strength,” Knight said.
He added that PGK tapped LRK Architects to handle to design work on the project, which is spread out over five parcels surrounding the Wonder Bread factory’s original 4-acre footprint at 400 Monroe Ave.
If the PILOT is approved, the Bakery Apartments and Garage plans on beginning demolition efforts in October, closing on financing in November, and wrapping up construction in June 2019.
“The former Wonder Bread site at 400 Monroe is one of the largest empty industrial buildings in the district. Putting this site back into productive use will add significant vibrancy to a district that has long been on the verge of transformation,” the CCRFC staff report read in part. “This development will also address prominent blight in the neighborhood.”
Per the terms of the PILOT, at least 20 percent of the residential units must be occupied by or held available for individuals and families of low and moderate income that generate less than 80 percent of the median gross income for Shelby County.
Additionally, the developers will have to spend at least 20 percent of costs with city and county certified MWBWs, which would equate to roughly $12.6 million.
More specific plans are expected to be submitted to the Design Review Board soon.