VOL. 133 | NO. 136 | Tuesday, July 10, 2018
Beale Hotel, South Main Mixed-Use Top Busy Week In Development
By Patrick Lantrip
It’s a busy week for the city of Memphis when it comes to economic development. The Downtown Memphis Commission has two of its affiliate boards, the Center City Revenue Finance Corp. and the Design Review Board, in action this week, while the Economic Development Growth Engine for Memphis and Shelby County is holding a meeting for its Economic Development Finance Committee.
Up first is the CCRFC, which is convening Tuesday morning. The agenda includes TCH Memphis LLC’s request to raze a former Beale Street nightclub with a checkered past and replace it with a 120-room hotel. Located at 380 Beale on the northeast corner of Beale and Fourth Street, the developers are seeking a 15-year tax break for the $16 million project.
Also on the agenda is New York investor Tom Intrator’s request for a 13.5-year PILOT to reimagine a vacant Downtown building into a mixed-use development. In October, the DMC acquired the 29,000-square-foot building at 18 S. Main St. with the hopes of issuing a request for proposal (RFP) to prospective developers interested in buying and renovating the property.
New York investor Tom Intrator has request for a 13.5-year PILOT to reimagine a vacant Downtown building at 18 S. Main St. into a mixed-use development. (Downtown Memphis Commission)
According to documents submitted to the CCRFC, Intrator has been an investor in the Memphis market since 2013. He owns seven multifamily properties totaling 1,630 units in the area though affiliated entities.
Currently, the annual city and county taxes on the property is $8,459, but during the term of the PILOT, DMC staff estimates the annual payment in lieu of taxes would equal approximately $24,739, which represents a 192 percent increase in taxes currently generated. This would result in a cumulative increase in taxes generated by this property of approximately $219,772.
Intrator says he will not incur debt to finance the $4.6 million project.
On Wednesday, the DRB will meet to review Memphis Riverfront Parks Partnership’s proposed sign package for the riverfront trail system.
The MRPP plans aim to brand the Downtown trail system in an effort to create greater public awareness and usage while connecting the existing assets to create a comprehensive trail system from the Wolf River Greenway to the Big River Crossing.
In total, the scope of the work includes 94 signs ranging from a single Memphis River Park feature sign to 48 smaller directional street signs.
The goals for the Riverfront Context include reinforcing the identity of the riverfront, enhancing pedestrian access to the river, and maximizing opportunities for outdoor uses that support recreational activities,” a DMC staff report on the project reads. “Staff believes the updated Memphis River Parks Signage is consistent with all of these goals by increasing connections along the River and with Downtown and enhancing vibrancy and quality of the experience within each space.”
Lastly, EDGE’s Economic Development Finance Committee will review Rick James and Castle Retail’s application for a $100,000 loan to help finance his new South Memphis Cash Saver.
In June, James’ Southgate Shopping Center landlords were awarded a 15-year Community Builder PILOT to help redevelop and stabilize the 208,297-square-foot shopping center that has dipped to a 39 percent vacancy rate after the site was abandoned by Kroger earlier this year.
The development group, spearheaded by Belz Investment Co., tapped local grocer and Castle Retail Group owner Rick James to anchor the redevelopment with a 31,000-square-foot grocery store to replace Kroger.
To help bridge the last financial gap, James is seeking a seven-year fully amortized loan with a two percent interest rate.
In his application letter to EDGE, James said that though the landlord has re-written the lease to a more appropriate structure for the trade area, and that the Works CDC is added $460,000 in capital and inventory, a loan is still needed.
“This leaves a financial gap of $100,000 to make this project feasible,” James said. “With assistance for the EDGE Economic Development Finance Committee of $100,000 for point-of-sale equipment (cash registers), meat and deli department scales, receiving and front office computers and security cameras, Castle Retail will be able to privately finance the remainder.”
The ED Finance Committee will hear James’ case at its Wednesday, July 11 meeting.