For most of the 1960s and 1970s, 6.5-square-mile downtown Memphis was singing the blues. Employers and residents were moving to the suburbs, and much of the central city, including the famous Peabody Hotel and historic Beale Street, was left for dead. “Few Memphians would [disagree] that one development in particular served as a catalyst for much of the development downtown Memphis is experiencing today,” says Andy Kitsinger, director of planning and development for the Memphis Center City Commission. “On July 31, 1975, Jack Belz purchased the Peabody Hotel for $75,000 and began a $24 million renovation.” The hotel reopened in 1981.
Today, approximately $3 billion in public and private funds has been invested in the area's renaissance. The result, says Jim Lutz, assistant professor in the architecture program at the University of Memphis, is “a Southern, Mississippi River town with a fair part of its historic fabric still intact. It comes by its 'grittiness' honestly. The rebirth of downtown Memphis is proof of what can be accomplished through the vision and commitment of architects and developers willing to be urban pioneers.”
Office Market
Downtown Memphis has 2.8 million square feet of office space. “There has not been a new, Class A office building delivered since 1997, and none is on the immediate horizon,” says Don Drinkard, marketing specialist for CB Richard Ellis. “The rental rates you need to achieve to attract tenants to downtown Memphis cannot support new office development.”
- Vacancy: 16.8% (2Q05); 18.2% (2Q06) - Availability: 17% (2Q05); 22.7% (2Q06)
- Average Asking Rate: $15.70/s.f. (2Q05); $15.81/s.f. (2Q06)
Source: CB Richard Ellis/Memphis
Residential Market
The residential population has grown 10.3 percent since 2000. The current downtown Memphis population is 18,000, with 33,167 estimated by 2111; about 68,000 people work there. Information workers and second-home buyers are driving sales. “Buyer demand seems to be steady, with some fears of cooling in the high-end residential market, particularly condos,” says Jim Lutz.
Market Strengths
- Amenities include Beale Street; Cannon Center for the Performing Arts; National Civil Rights Museum; and Mississippi riverfront - Residential development
- $5.6 million in infrastructure improvements
Market Concerns
- Dearth of office space - Residential overbuilding
- Lack of developable land; underperforming buildings
Development Incentives
The PILOT (payment in lieu of taxes) Program freezes real estate taxes at the current, predevelopment rate for owners who improve or stabilize properties. The Development Loan Program allows owners to borrow as much as $90,000 for building renovations.
Developable Land
About 9 percent the Central Business Improvement District's 3,000 acres is undeveloped. About 10 percent (7.2 million square feet) of the CBID's 75 million square feet of building area consists of vacant buildings. The Center City Commission earmarked 10 underperforming/vacant properties as the city's most-developable sites.
Key Architects
Archimania, Blackledge Architecture, Chooch Pickard, Coleman Coker, Hnedak Bobo Group, Looney Ricks Kiss, Self Tucker Architects
Key Developers
Belz Enterprises, Chamberlain McCreery & Rice, Henry Turley Co., Memphis Bioworks, Partners Court Square Center, Riverfront Development Corp., Woodard Properties
Forecast
“Architects are here to improve the built environment,” notes Archimania principal Todd Walker. “We can add to the character, scale, mass, context, and social appeal of downtown by approaching the urban fabric with thoughtful and progressive design. If the city's built environment is to be improved in a conscientious way, an architect with the right credentials can make it happen.”
Notable Projects
