VOL. 133 | NO. 116 | Monday, June 11, 2018
Memphis Real Estate Recap
Lake District Lands Malco Theater, Former Benchmark Seeks New Life
By Patrick Lantrip
3536 Canada Road,
Lakeland, TN 38002
Tenant: Malco Theatres Inc.
Tenant’s Agent: Michael Lightman, Michael Lightman Realty
Landlord: The Lake District
Landlord’s Agent: Shawn Massey, The Shopping Center Group
Details: More good news for the residents of Lakeland as Malco Theatres Inc. has signed a letter of intent to construct a “state-of-the-art” movie theater in The Lake District.
The news of Malco’s 38,000-square-foot theater comes several months after the 160-plus-acre mixed-use Lake District project announced its first tenant would be The Stock Market, an upscale grocery store operated by independent retailer Jeff Burkhead.
Shawn Massey of The Shopping Center Group represented the Lake District in the deal, while Michael Lightman of Michael Lightman Realty represented Malco Theatres.
Malco vice president David Tashie said the Lake District was the “clear choice” for a theater in northeast Shelby County due to a changing retail landscape that favors entertainment options within mixed-use developments.
Malco is also in the process of bringing a seven-screen theater, known as the Powerhouse Cinema, to the $55 million Central Station project in Downtown’s South Main Historic Arts District.
Including the new Malco theater, The Lake District will include 300,000 square feet of retail and restaurant space, two hotels, 240 custom-built single-family homes, 390 apartments and 168 age-restricted apartments.
164 Union Ave.
Memphis, TN 38103
Project Cost: $42 million
Application Date: June 5, 2018
Completion: Q1 2020
Owner: Magna Hospitality Group
Details: A Rhode Island-based company has acquired the site of the former Benchmark Hotel and is seeking a 15-year tax incentive from the Downtown Memphis Commission to demolish the structure’s remaining concrete skeleton and replace it with a new four-star hotel.
If approved, Magna Hospitality Group, doing business as MHF Memphis VI LLC, could begin demolition on the blighted structure in early 2019 and wrap up construction on the 170-room, five-story hotel roughly a year later.
Magna will be seeking a 15-year payment-in-lieu-of-taxes incentive, or PILOT, from the DMC’s Center City Revenue Finance Corp. for the $42 million project. The CCRFC meets Tuesday, June 12.
A DMC staff report released Tuesday, June 5, said that remediating the blighted condition of the former Benchmark Hotel has been a top priority over the past 18-24 months.
“That focus is in large part due to the highly prominent location of this property,” the staff report read in part. “Union Avenue is a key gateway to Downtown Memphis from the east and over 350,000 people attended a Redbirds game at the adjacent AutoZone Park last year alone.”
The previous owners, MNR Hospitality, acquired the property in 2012, a year after the Benchmark closed. They began demolition of the building’s exterior walls in 2016, but left the work unfinished until the DMC filed paperwork in Environmental Court earlier this year.
Environmental Court Judge Larry Potter declared the site a public nuisance in February, despite claims by MNR that it was still an active construction site. The building had been in a partially demolished state for more than a year and a half.
Currently, the annual city and county taxes on the property are $41,996. If approved, the PILOT would produce $203,852 in taxes on the property annually, a 385 percent increase from today, according to the DMC. During the 15-year course of the PILOT, this would result in a cumulative increase of $2.4 million.
Based in Warwick, Rhode Island, Magna Hospitality Group was co-founded in 1999 by Robert A. Indeglia Jr. According to its application, the company currently owns or manages 28 hotels totaling more than 5,800 rooms with a real estate value of over $1.5 billion.
400 Monroe Ave.
Memphis, TN 38103
Permit Amount: $20 million
Project Cost: $73 million
Application Date: June 6, 2018
Owner: SWH Partners/Development Services Group
Architect: Looney Ricks Kiss
Contractor: Montgomery Martin Contractors
Details: The team redeveloping the Wonder Bread bakery and several nearby properties has filed a $20 million building permit application for the apartment portion of the $73 million mixed-use project.
Looney Ricks Kiss was tapped to handle the design work, while Montgomery Martin Contractors will head up the construction.
The application lists SWH Partners as the property owner and tenant. Founded as Schaedle Worthington Hyde Properties in 1991, the Atlanta-based firm specializes in multifamily and mixed-use investments, including development and other value-creation strategies.
Lead developer Development Services Group announced plans last August for the bakery project, including nearly 300 upscale multifamily units, a 480-space garage and 150,000 square feet of office and retail space. Later that month, Orion Federal Credit Union confirmed plans to move its headquarters to the development.
Parcels on North Main Street
and Jefferson Avenue
Memphis, TN 38103
Sale Amount: $1.7 million
Sale Date: May 31, 2018
Buyer: Townhouse Management Co.
Seller: Jefferson Partners
Details: New York-based Townhouse Management Co., doing business as THM Memphis Acquisitions LLC, has acquired the last two parcels that share a block with the 37-story 100 North Main building, which it plans to redevelop into a 600-room Loews hotel.
Listed as 0 Main Street and 0 Jefferson, the two parcels were purchased from Jefferson Partners for $1.7 million, according to a May 31 warranty deed. The two empty parcels total a combined 0.6 acres and were collectively appraised for $670,000 by the Shelby County Assessor this year.
The proposed renovation of the city’s tallest building carries a preliminary price tag of $400 million.