VOL. 133 | NO. 124 | Thursday, June 21, 2018
Binghampton Apartments, Parkside TIF Get EDGE Greenlight
By Patrick Lantrip
Several hundred new apartments, a South Memphis grocery store and a new TIF district were all given the green light by the Economic Development Growth Engine for Memphis and Shelby County during a busy Wednesday, June 20, board meeting.
Up first was 3D Realty’s request for a 15-year Residential PILOT (payment-in-lieu-of-taxes) for a $51 million, 414-unit mixed-use multifamily project on Broad Avenue.
Broad Avenue project (Submitted/EDGE)
Unlike most PILOTs, which focus on job creation and retention, Residential PILOTs are designed to help narrow the financial gap for multifamily projects in the city’s core areas.
“Our vision for this project is to represent everything good about Memphis,” 3D Realty co-founder James Maclin said. “We’re engaging the public, and we’re engaging the Broad Avenue family.”
A 222,000-square-foot former Sears warehouse currently stands at 2542 Broad Ave., but due to the building’s poor condition, everything but the iconic Broad Avenue water tower will be replaced with multiple four-story buildings consisting of 124 studio apartments, 207 one-bedroom units and 83 two-bedroom units.
3D Realty has committed 83 units, or 20 percent, to low- to moderate-income residents.
In addition to the multifamily component, the project will include 10,000 square feet of ground-floor commercial space and nearly 400 parking spaces.
Currently the property generates $33,204 in local taxes per year, and EDGE staff estimates that during the PILOT, that number would increase to $307,052 per year.
Slightly to the west, Makowsky Ringel Greenberg was awarded a 15-year Residential PILOT to bring 176 apartment units to the intersection of East Parkway and Sam Cooper Boulevard.
Known as Thrive at the Park, the $22.2 million project will consist of two three-story buildings and 10 two-story townhouses that will include 113 one-bedroom units, 63 two-bedroom units and 233 off-street parking spaces.
Thrive at the Park (Submitted/EDGE)
Thirty-six, or 21 percent, of the units will also be reserved for low- to moderate-income residents.
Currently, the property generates $12,222 a year in property taxes. EDGE estimates this figure will increase to $152,461 per year during the length of the PILOT.
In total the project is expected to cost $22.2 million.
Additionally, a group of developers looking to breathe new life in to the Southgate Center was 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.
Southgate Center (Submitted/EDGE)
The development team, which operates under the name Union Realty Co. GP, is a partnership among Belz Investment Co., Oak Associates, URCO Inc. and Belz Investco GP.
Union Realty plans on investing $6.8 million into the property, including upgrades to the exterior, tenant finishes and new grocery store equipment, which will create 47 full-time grocery store positions and 60 part-time retail positions equivalent to 92 full-time jobs with an average annual wage of $24,960.
Belz tapped local grocer and Castle Retail Group owner Rick James to anchor the redevelopment with a 31,000-square-foot grocery store while they attract tenants to the remaining vacant bays, which range from 900 to 22,000 square feet.
After the meeting, James said it took great deal of legwork from Belz, the Memphis City Council and EDGE to help make the project a reality.
“All of those pieces added together give us a fighting chance to bring a great supermarket back to this neighborhood,” he said.
In other action, the developers of the proposed Parkside at Shelby Farms project were approved for a tax-increment financing (TIF) designation to fund nearly $72 million in public infrastructure improvements to the area, including the construction of a four-lane Shelby Farms Parkway.
A TIF designation works by using the area’s new tax growth to finance public projects in the approved district, which in this case stretches as far north as Macon Road and Interstate 40 to south of Walnut Grove Road.
The 60-plus-acre mixed-use project now carries a $375 million price tag and includes 33,000 square feet of commercial and office space, more than 1,400 multifamily residences, a 130-room hotel and structured parking.
The project is expected to create 4,500 construction jobs and has a minority participation goal of 25 percent, or $93.7 million.
Over the next 20 years, the applicants estimate that about $76 million in taxes will go to the city and county, with the remaining $96.3 million being funneled back into the TIF district.
With the EDGE board approval, the developers are hoping to get the green light from the Shelby County Commission on July 9 and the Memphis City Council on July 10.