VOL. 132 | NO. 125 | Friday, June 23, 2017
EDGE Gives Frayser Gateway Project Nod
By Patrick Lantrip
With all of the new development buzzing around Downtown, Midtown and East Memphis, it could be easy to overlook the addition of a new grocery store, but for some Frayser residents, it could mean everything.
The Frayser Gateway, a proposed $16 million, 97,000-square-foot grocery-anchored shopping center at 2571 N. Hollywood St. was awarded a 15-year tax incentive by the Economic Development Growth Engine for Memphis and Shelby County Wednesday, June 21. The tax abatement paves the way for the first development of its kind in Frayser in more than three decades.
“The gateway property, unfortunately, has been substantially vacant for 20-plus years,” Shawn Massey with the Shopping Center Group told the EDGE board. “It has been a source of blight and abandonment for many of those years. It sets a bad example of what the Frayser community is perceived as and not what really exists in the community because it is at the front door.”
The overarching goal of the project is to use the nearly 20-acre abandoned site to land a 20,000- to 45,000-square-foot grocery tenant that would provide much-needed relief to neighborhoods east, south and west of the site that are USDA-certified food deserts.
“We are just beginning the marathon of the urban development process,” Massey said. “With the Community Builder PILOT in place we can now approach retailers who may have previously overlooked the potential of locating in the Frayser community for a lack of quality space adjacent to a supermarket anchor, which is paramount to any neighborhood retail development.”
Massey represented Dipesh Patel, whose company, G2 Ventures, owns the property.
If completed, the Frayser Gateway would employ 165 part-time employees plus 11 managers, which would equate to 136 full-time-equivalent jobs with an average base salary of $23,294, according to the application.
Of the $16 million in total project investment, $1.5 million is for the purchase of the property, $12.8 million will go toward new construction and site improvements, and the remaining $1.8 million will be spent on soft costs.
Per the terms of the PILOT, the applicants will have to spend $3.2 million of construction costs with certified minority and women business enterprises (MWBEs) in Memphis and Shelby County.
In total, the PILOT would offer a $4.5 million benefit to the applicants, while generating $7.7 million in local tax revenues for a 1.73 cost-to-benefit ratio.
“I always think it’s important to show benefit,” EDGE board chairman Al Bright Jr. said after the decision was reached. “Close to $8,000 in taxes now, to over $100,000 during the term of the PILOT – these are the deals that you just don’t seem to recognize that we’re actually adding back cash into the community.”
The Frayser Gateway follows on the heels of a similar project Massey spearheaded, The Binghamton Gateway, which is a 33,000-square-foot shopping center near the intersection of Tillman Street and Sam Cooper Boulevard that broke ground in February.
Much like the Frayser Gateway, this shopping center is located in a USDA-certified food desert and seeks to offer the residents of Binghamton access to fresh food that was previously unavailable.