WEBVTT
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- (female announcer)
Production funding for
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Behind the Headlines
is made possible in part by
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the WKNO Production Fund,
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the WKNO Endowment Fund
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and by viewers
like you, thank you.
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- A look at development and
redevelopment in Memphis,
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tonight on Behind the Headlines.
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[intense orchestral music]
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I'm Eric Barnes with
The Daily Memphian.
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Thanks for joining us.
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I'm joining tonight by
Paul Young, President and CEO
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of the Downtown
Memphis Commission.
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Thanks for being here again.
- Thank you for having me.
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- First time in person.
- Yeah.
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- Actually since--
- In a long time.
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- In a long time,
in a long time.
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Thank you.
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Along with Bill Dries,
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reporter with
The Daily Memphian.
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I wanted to start,
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I mean, Downtown
Memphis Commission,
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actually, it's
not just Downtown.
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You guys have actually
a much bigger footprint
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and influence.
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But I did wanna start talking
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about one specific
project, 100 North Main,
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not just cause it's an
iconic building in Memphis
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and it's a big, you know,
multi, a hundred million,
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two hundred, three hundred
million redevelopment
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but also in a lot of ways,
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it's emblematic of a
lot of what's going on.
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So it's about a 100 North
Main but it's about others.
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And we'll talk about other
things going on big and small
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throughout Downtown,
Midtown, Medical District
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and really citywide.
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But one of the interesting
things about a 100 North Main
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was it was, you know,
essentially blighted.
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It was sort of abandoned
by all its tenants.
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It was in great disrepair
to the frustration of many,
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you know, just again,
it's a bad look
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when this iconic building
Downtown is empty and dark.
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Ultimately, and it wasn't
you, it was your predecessor,
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DMC bought that building.
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And it's a little controversial
because the developer
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who had let it go dark and
let it get really blighted,
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ultimately kinda made
money on the deal.
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And also people question
should DMC be buying
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and selling buildings?
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I mean is so, but it's worked
out it seems like, right?
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Billy Orgel has come forward.
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He's had a very
successful track record.
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Other locals, Kevin Woods,
and others involved with it.
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Is that a successful
model for redevelopment
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of blighted
buildings in Memphis?
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And do you think you might
end up doing other things
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like that, big or small?
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- Yeah, I do think it's
a successful model.
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It's a building that was stuck.
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And in some instances,
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particularly in
Downtown Memphis
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where you have these
large buildings,
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you have some
people that believe
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that they can make
a greater return
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if they just sit on the property
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and it's to the detriment
of the whole community.
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And so we have a building
that went dark in 2014, 2015,
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been dark ever
since, had no future.
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There was no hope
for the building,
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for the structure at
least in the short-term.
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And so it was important that DMC
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and the city step
up to the plate
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and find a way to get
this property unstuck.
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The way that we did that was
we acquired the structure
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and you're absolutely correct,
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it started before I got there.
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Jennifer Oswalt and the
team began the process
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of activating the acquisition.
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They acquired the building
shortly after I got there.
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I think it was March, April
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when we actually got the
building in our hands
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and we aggressively put
forth an RFP for developers.
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We didn't get into this saying
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that we want to develop
the structure ourselves.
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We knew that we weren't
quite suited to do that,
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but we knew that we could
facilitate the development.
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And it was really,
really exciting.
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And it was a great
testament to Memphis.
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The fact that we got 11
teams, 11 qualified teams,
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many of which were outside
of the Memphis market
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were interested in developing
the tallest structure
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in Memphis, 37 stories.
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We went through a very
competitive process.
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It was probably the most
difficult, competitive process
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that I've been a part of
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because there were so
many good qualified teams,
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great ideas.
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And I was grateful that we
had a home team that came
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and put forth a
competitive application.
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And they're the ones that are
going to take this property
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into the future.
- But, quick question,
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will the city actually
make money on the deal?
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- We won't make money.
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The team did agree to pay
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what we paid for the property.
- Okay.
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- So we look at that
as an opportunity
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to be able to
continue to reinvest.
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And if there are other
properties that are stuck
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in the future, we
can use those funds
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to try to do a similar
process if needed.
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- One more question,
I'll go to Bill.
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Does the fact that 11 teams,
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again, local and all around
the country come forward
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with, you know, very,
very robust proposals.
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Does that speak to maybe
a turning point in Memphis
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as Downtown development, in
Memphis development generally?
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And that maybe some
of what you have to do
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when you have to
unstuck a building,
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unstick a building or the
incentives that you all do
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and others do, are those maybe
not as nest necessary now
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for there is that
level of demand?
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Or are we still in that business
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where you guys are
gonna have to step in
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and have to do the kinds of
incentives you have to do?
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- Yeah, I definitely think
we're still in that business.
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There's still an economic
reason for the incentives.
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We were getting to the point
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where the rental rates and
I'll just talk about housing.
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When you talk about apartments
in Downtown Memphis,
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we were getting to the
point where the rental rates
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were starting to tick up
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and it looked like
the incentives
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will be less necessary
than they had been in the past.
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But right as we got to that
point, the pandemic hit
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and the construction
costs have skyrocketed.
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And so even with the
uptick in the rental rates,
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it's still difficult for
project to pencil out.
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And so those incentives
are still very critical.
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- Ah, Bill.
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- 100 North Main, the
city's tallest building
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is just less than a block away
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from what was going
to be the site
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of a second convention
center hotel.
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That's not gonna happen
at least with Loews
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and at least at this point.
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Does that change the outlook
for that general area
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around 100 North Main?
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- I don't think it necessarily
changes the outlook.
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Obviously, we were
all looking forward
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to seeing Loews come in
that space and it's no for now.
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We're hopeful that
as things settle down
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and the economy moves back
in the right direction,
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that, that project could
potentially move forward
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or come back in
some different form.
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We still have projects
like the Hyatt Grand
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which is getting close.
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And so we're really
excited about that.
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That's the project at 1 Beale,
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which is adjacent
to the Hyatt Centric
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and the Hyatt Caption which
is under construction.
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I know that's a little
bit of ways away
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but that just gives us
optimism with regards
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to our convention aspect.
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In terms of that
area in particular,
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we still have the size of
that 100 North Main structure
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still gives us
significant activity.
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It livens up that block.
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And remember it's not just
the building 100 North Main,
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there are the four adjacent
structures that are next to it
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along Main Street.
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And so when you activate
those structures,
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it still creates a very, very
vibrant scene on that block.
07:19.439 --> 07:24.444
- Has the pandemic made
financing hotels more difficult?
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- Yeah, from what we've heard,
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we've heard that it is more
difficult during the pandemic,
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you know, as hotels and tourism
is starting to move back
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into a positive direction,
07:37.957 --> 07:42.962
I think that financers will
have more confidence in markets.
07:44.331 --> 07:46.099
But yeah, it's definitely
been more difficult.
07:46.099 --> 07:48.468
- And yet on the other hand,
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we've got the
hotel construction.
07:50.103 --> 07:54.274
You mentioned that
it's part of 1 Beale.
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And there has been some
talk that I've heard
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that maybe this could lead
to other hotel developments
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further east, maybe
at Main and Beale,
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possibly south on Beale
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where I think there
had been plans
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at Fourth and Beale for it.
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What can you say about that?
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Namely, Main and Beale.
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- Yeah, I can say that
there's always people looking
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at different projects
and initiatives
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in Downtown Memphis.
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I actually haven't heard about
the one in Main and Beale
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that you're you're referencing
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but I do know about the one
that's over near FedExForum.
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There's a group that's looking
at acquiring some property
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in that area that has
some ideas around hotels.
08:39.953 --> 08:42.956
I still think that we
have a very strong market.
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There's still a lot of demand.
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There's still a lot of
developers that are circling
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and trying to figure out the
right project for Downtown
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whether it's a
hotel or apartments
08:51.965 --> 08:54.701
which tend to do very
well in Downtown Memphis
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and other retail amenities.
08:56.002 --> 08:59.839
So I have a lot of
confidence and optimism
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that Downtown is gonna
continue to be strong
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well into the future.
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- Well, our offices are located
in the South Main District
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and after being at Fourth
and Jefferson initially
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for our offices,
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and the contrast has
been pretty interesting
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with South Main coming along,
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development going up to Crump
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in some cases on the
other side of Crump.
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Has that kind of
altered the geometry
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of Downtown development?
09:32.138 --> 09:34.908
- It's definitely
stretching Downtown out.
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You know, the
entertainment district,
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that area around Beale Street
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was traditionally the
heart of Downtown.
09:41.514 --> 09:44.184
Now, you have South
Main being activated.
09:44.184 --> 09:48.088
You have more activity happening
in the core with projects
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like the Commonwealth
on Madison.
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And then when you look
in the Uptown area,
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the work that's happening
with Conwood that Billy Orgel
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has been a part of or
Malone Park Commons
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which Andre Jones has initiated.
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There's a lot of things that
are happening in Downtown
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that stretching it out
and adding that vibrancy
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in more parts of Downtown.
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- All that is
against the backdrop,
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you mentioned COVID and how
things changed or stopped
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and it obviously had a
huge impact on tourism.
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It's also had a huge
impact on offices.
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Memphis already had an okay
office market Downtown.
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I mean, there was a
certain amount of vacancy.
10:26.092 --> 10:28.127
100 North Main
was an office tower.
10:28.127 --> 10:32.031
There are others, the former
Morgan Keegan building
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right on the water and so on.
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The Morgan Keegan building,
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I'm gonna call it the
Morgan Keegan building
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'cause I can't
remember apparently.
10:40.073 --> 10:42.175
Raymond James, Morgan
Keegan, it's all the same.
10:42.175 --> 10:45.578
But right down,
overlooking the water
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at, you know, the
end of Jefferson
10:47.547 --> 10:50.149
is now I think gonna be
turned, I think I heard,
10:50.149 --> 10:51.584
or I think we wrote that
it's gonna be turned
10:51.584 --> 10:53.920
into residences, into
apartments and there's rumors
10:53.920 --> 10:58.224
of other office buildings
being turned into residential.
10:58.224 --> 10:59.659
Do you see more of that?
10:59.659 --> 11:01.861
And do you all get
engaged in that
11:01.861 --> 11:03.897
in terms of supporting those
kinds of transformations?
11:03.897 --> 11:06.599
Because it doesn't seem like
there's gonna be as much demand
11:06.599 --> 11:08.668
for offices anywhere
in the country.
11:08.668 --> 11:10.770
Obviously, cities like
New York and San Francisco
11:10.770 --> 11:12.672
are being hit really hard.
11:12.672 --> 11:15.375
In some ways we have
the benefit of not having
11:15.375 --> 11:17.911
as much office, you
know, space Downtown
11:17.911 --> 11:19.812
and so that doesn't
hit us as hard.
11:19.812 --> 11:22.482
But these transformations
are gonna be more of them.
11:22.482 --> 11:26.152
- Yeah, so we certainly are
engaged in those conversations.
11:26.152 --> 11:28.922
We're not quite ready to
give up on offices just yet.
11:28.922 --> 11:31.858
We know that there's a lot
of flux as a result of COVID,
11:31.858 --> 11:35.161
but we are starting to hear
more large employers say
11:35.161 --> 11:37.397
that they want to move
back into offices.
11:37.397 --> 11:42.402
So our large Downtown companies
like AutoZone or Terminix,
11:43.303 --> 11:44.804
all of them have been thinking
11:44.804 --> 11:46.973
about when they're going to
bring people back in the office
11:46.973 --> 11:49.509
and they're in the
process of doing that.
11:49.509 --> 11:51.277
So while we know that
some of those buildings
11:51.277 --> 11:54.347
like you referenced are having
some tough times right now,
11:54.347 --> 11:56.749
we are not necessarily
pushing them
11:56.749 --> 11:58.184
to make those conversions.
11:58.184 --> 12:00.186
Obviously, if they want
to do it on their own,
12:00.186 --> 12:02.388
we're supportive
of them doing it.
12:02.388 --> 12:05.258
We're not necessarily
looking to incentivize it.
12:05.258 --> 12:08.895
But if they're looking to
do that, then, you know,--
12:08.895 --> 12:10.363
- That's interesting.
12:10.363 --> 12:12.498
Why so explicit that you
don't wanna incentivize it?
12:12.498 --> 12:16.936
- Well, we don't want to
give up on the opportunities
12:16.936 --> 12:20.273
to bring large
employers to Downtown.
12:20.273 --> 12:21.474
- Got it.
12:21.474 --> 12:24.043
- And when you see large
structures like that
12:24.043 --> 12:27.947
where there's the potential
for Class A office space,
12:27.947 --> 12:30.683
for us to incentivize
that transition
12:30.683 --> 12:34.854
would not necessarily be the
best use of public dollars.
12:34.854 --> 12:36.322
- But then you've got the risk
12:36.322 --> 12:38.725
that a building like
that goes dark, right?
12:38.725 --> 12:39.692
I mean, a 100
North Main coming--
12:39.692 --> 12:40.660
- It's definitely a risk.
12:40.660 --> 12:41.894
It is definitely a risk.
12:41.894 --> 12:44.697
But we believe that
it's important for us
12:44.697 --> 12:46.366
to maintain opportunities
12:46.366 --> 12:49.068
to bring those large
companies back to Downtown,
12:49.068 --> 12:50.803
at least in the short-term.
12:50.803 --> 12:54.340
- Yeah, you've mentioned
before the incentives structure
12:54.340 --> 12:55.808
and that rental rates
were getting to the point
12:55.808 --> 12:58.277
that those incentives
weren't quite as necessary.
12:58.277 --> 13:00.913
Obviously, COVID kind of
turned everything upside down.
13:00.913 --> 13:03.583
We did a show back in
the fall with a bunch of
13:03.583 --> 13:05.852
housing advocates
including Dorcas Young,
13:05.852 --> 13:07.987
a woman I think you have
known for quite a while.
13:07.987 --> 13:09.222
- Heard of her.
- Heard of her, heard of her.
13:09.222 --> 13:11.958
That's his sister, who
works for the county
13:11.958 --> 13:14.460
and she and others,
you know, talked about,
13:14.460 --> 13:17.930
yeah, there is this boom among
middle and upper middle class
13:17.930 --> 13:21.200
and, you know, higher end
staff across the city,
13:21.200 --> 13:24.570
but there isn't enough
affordable housing, you know,
13:24.570 --> 13:26.773
and that, that is a
dynamic that, you know,
13:26.773 --> 13:28.174
I can't remember
how many thousands,
13:28.174 --> 13:29.409
it might have been
tens of thousands
13:29.409 --> 13:33.146
that they need in terms
of affordable housing,
13:33.146 --> 13:36.883
that people can get into it,
that even people, this is not,
13:36.883 --> 13:38.351
I mean, this is
people with jobs.
13:38.351 --> 13:42.789
This is people, maybe not
the best credit report
13:42.789 --> 13:44.457
but they're working,
they have the money
13:44.457 --> 13:46.225
and they simply can't
find a place to live.
13:46.225 --> 13:48.695
You used to run, you know,
Housing/Community Development
13:48.695 --> 13:50.029
for the city.
13:50.029 --> 13:52.165
You're very close
to these issues.
13:53.366 --> 13:56.369
How does DMC and how
do you balance that,
13:56.369 --> 13:59.839
these high end expensive
apartments going in
13:59.839 --> 14:01.140
for which there's
a lot of demand,
14:01.140 --> 14:02.508
which pay a lot of taxes,
14:02.508 --> 14:05.578
which makes sense with the
need for affordable housing?
14:05.578 --> 14:08.414
- Yeah, so the demand
for affordable housing
14:08.414 --> 14:09.649
obviously is very high.
14:09.649 --> 14:10.917
And if we wanna
go down that lane,
14:10.917 --> 14:13.386
I can talk pretty
in depth about it.
14:13.386 --> 14:15.488
The way we balance it
with Downtown Memphis
14:15.488 --> 14:18.958
is we ensure that any property
that receives an incentive,
14:18.958 --> 14:21.794
our biggest incentive
being the PILOT program.
14:21.794 --> 14:24.330
But any property
that receives a PILOT
14:24.330 --> 14:27.166
must have at least 20%
of their units serve
14:27.166 --> 14:31.137
families that earn at least
80% of the area median income
14:31.137 --> 14:34.741
which is a, you know,
working class wage.
14:34.741 --> 14:36.242
We believe that it's
really important
14:36.242 --> 14:39.445
that we have a diverse mix
of housing in Downtown.
14:39.445 --> 14:42.682
We wanna make sure that the
people that live Downtown
14:42.682 --> 14:45.051
reflect the culture and
the character of the city,
14:45.051 --> 14:48.121
that we continue to have
the vibe of Memphis.
14:48.121 --> 14:50.590
We don't wanna be a city
where all of the people
14:50.590 --> 14:52.258
that make Memphis, Memphis,
14:52.258 --> 14:54.160
aren't able to
afford to live there.
14:54.160 --> 14:58.498
And so we balance that by
ensuring that the projects
14:58.498 --> 15:01.801
that we incentivize have
that affordability component.
15:01.801 --> 15:03.202
In addition to that,
15:03.202 --> 15:06.439
we also have some larger
affordable housing developments
15:06.439 --> 15:10.143
like South City which is
a mixed income development
15:10.143 --> 15:12.278
which is right on
the cusp of Downtown,
15:12.278 --> 15:15.548
is kind of the bridge between
Downtown and South Memphis.
15:15.548 --> 15:19.152
You also see projects like
what Elmington Capital
15:19.152 --> 15:20.720
has been doing in Downtown.
15:20.720 --> 15:23.289
So Forum Flats, Patterson Flats,
15:23.289 --> 15:25.224
there's some other
properties in Uptown
15:25.224 --> 15:28.227
which are truly affordable
housing developments
15:28.227 --> 15:30.096
with low income
housing tax credits.
15:30.096 --> 15:32.331
And so as long as we
continue to see projects
15:32.331 --> 15:35.568
like that take place along
with the higher end projects,
15:35.568 --> 15:38.004
we believe that we'll
have a good mix Downtown.
15:39.739 --> 15:41.774
- And to that end,
I think South City
15:41.774 --> 15:45.178
is just about to
start its last phase.
15:45.178 --> 15:47.880
- Yeah, it's getting close.
- Yeah.
15:47.880 --> 15:52.285
And as that's happened,
well, the thought initially
15:52.285 --> 15:54.320
was all of this is
going to link up.
15:54.320 --> 15:56.122
South City is going to link up
15:56.122 --> 15:59.458
to what's happening further
west toward to toward the river.
16:01.060 --> 16:03.429
And these things certainly
don't happen by accident
16:03.429 --> 16:05.164
or by osmosis either.
16:05.164 --> 16:10.169
So in South City's case, I
think a lot of this was informed
16:11.470 --> 16:13.339
by other HOPE VI
federally funded projects
16:14.207 --> 16:16.242
which does to your housing
16:16.242 --> 16:18.644
and community development
background again.
16:18.644 --> 16:22.982
But what have we seen
so far from South City
16:22.982 --> 16:26.285
in terms of living
up to that promise?
16:26.285 --> 16:27.553
- I think it's
definitely lived up.
16:27.553 --> 16:30.256
Obviously it's a very
attractive development
16:30.256 --> 16:31.490
if you drive by there.
16:32.892 --> 16:36.095
The structures look amazing and
it feels like a neighborhood
16:36.095 --> 16:37.330
and it feels like a neighborhood
16:37.330 --> 16:40.199
that's integrated with
the community around it.
16:40.199 --> 16:42.068
I think we're already
seeing the impact.
16:42.068 --> 16:44.370
I don't think you would
see a project like the Walk
16:44.370 --> 16:46.239
which was proposed
a few years ago
16:46.239 --> 16:48.908
and they are getting very close.
16:48.908 --> 16:50.643
You wouldn't see
projects like the Walk
16:50.643 --> 16:53.179
but for projects
like South City.
16:53.179 --> 16:55.648
You wouldn't see
projects like Butler Row
16:55.648 --> 16:57.316
which was just
proposed at the corner
16:57.316 --> 16:59.552
of G.E. Patterson and Second.
16:59.552 --> 17:01.687
You wouldn't see Wiseacre
17:01.687 --> 17:03.823
which is located
on B.B. King rather.
17:05.224 --> 17:07.126
You wouldn't see those
things take place.
17:07.126 --> 17:12.131
You have projects that COGIC
are doing along Vance Avenue.
17:13.499 --> 17:15.902
Also on Vance, you have a
project that I was involved with
17:15.902 --> 17:19.338
before I came to DMC
at Fourth and Vance
17:19.338 --> 17:23.442
where Tyrone Burroughs
and Scott Bojko
17:23.442 --> 17:26.112
are working on a new
development right there.
17:26.112 --> 17:28.681
There are a lot of things
that are happening adjacent
17:28.681 --> 17:31.117
to South City that would
not have taken place
17:31.117 --> 17:34.253
but for the investment that
the city and HUD and others
17:34.253 --> 17:35.588
made into that project.
17:37.189 --> 17:40.226
- And this is one
of those projects
17:40.226 --> 17:44.330
where there's been a lot of
discussion about displacement.
17:44.330 --> 17:47.066
And in this case, there
are actually more units
17:47.066 --> 17:49.502
on the sites of the
two housing projects,
17:49.502 --> 17:52.038
public housing developments
that were there
17:52.038 --> 17:54.240
than there were before
this transition.
17:54.240 --> 17:58.044
- Yeah, I think there
were 420 units on the site
17:58.044 --> 18:01.547
before the property
was demolished.
18:01.547 --> 18:04.417
They're rebuilding 712 units,
18:04.417 --> 18:06.986
four hundred and sixty of
which will be affordable.
18:06.986 --> 18:08.421
So there's actually
more affordable
18:08.421 --> 18:11.824
housing on the site
than previously existed.
18:11.824 --> 18:15.061
And back when I was
involved around a year ago,
18:15.061 --> 18:18.064
in terms of the numbers of
people that had returned
18:18.064 --> 18:19.532
to the property,
18:19.532 --> 18:22.168
that number was well beyond
what we had seen return
18:22.168 --> 18:24.670
at other projects that
had been done in the past.
18:24.670 --> 18:27.840
So I believe that it's
a positive for Downtown.
18:30.509 --> 18:35.514
- In terms of Memphians
adapting to this new thing
18:36.248 --> 18:37.717
of mixed income housing,
18:37.717 --> 18:41.253
because we did tend in this
city and in other cities
18:41.253 --> 18:43.856
to segregate ourselves
economically and racially
18:43.856 --> 18:48.227
without there being
laws involving that.
18:50.796 --> 18:53.599
Have Memphians changed
their mind about that?
18:53.599 --> 18:56.969
Are they more willing
to look at mixed income,
18:56.969 --> 18:59.905
mixed use neighborhoods as well?
18:59.905 --> 19:00.873
- Yeah, I think so.
19:00.873 --> 19:02.842
I mean, if you look Downtown,
19:02.842 --> 19:06.212
any residential project
that gets completed,
19:06.212 --> 19:07.780
fills up relatively quick
19:07.780 --> 19:10.316
because people like
that lifestyle.
19:10.316 --> 19:13.019
And always take it back
to how my parents grew up.
19:13.019 --> 19:14.687
My parents grew up
in South Memphis.
19:14.687 --> 19:16.155
Both of them grew up
in different parts
19:16.155 --> 19:17.356
of South Memphis.
19:17.356 --> 19:18.591
And in their neighborhood,
19:18.591 --> 19:21.360
they had the janitor living
next door to the teacher,
19:21.360 --> 19:24.030
next door to the doctor,
next door to the lawyer.
19:24.030 --> 19:27.433
And so we had mixed
income communities.
19:27.433 --> 19:30.836
It's the way neighborhoods
were traditionally made.
19:30.836 --> 19:32.538
And we're just
going back to that.
19:33.806 --> 19:37.777
- You mentioned we could
talk a lot more on...
19:37.777 --> 19:39.178
Well, we've got
seven minutes left
19:39.178 --> 19:41.447
so let me move along and
we'll get you back soon
19:41.447 --> 19:43.516
to talk more about this
affordable mix and so on
19:43.516 --> 19:45.518
because it's a fascinating
development we did.
19:45.518 --> 19:47.453
Archie Willis who you
were on the show with,
19:47.453 --> 19:48.888
who's developer, South City,
19:48.888 --> 19:50.222
and Roshun Austin
were on recently.
19:50.222 --> 19:52.525
We talked about the
area around Northside
19:52.525 --> 19:55.361
and just what it takes
to rebuild neighborhoods
19:55.361 --> 19:57.329
and people like you who've
been in the heart of it.
19:57.329 --> 19:58.831
But we'll move on.
19:58.831 --> 20:00.966
You mentioned Union Walk
was originally Union Row.
20:00.966 --> 20:03.369
And so, you know, for
people who don't live
20:03.369 --> 20:04.637
or work Downtown,
20:04.637 --> 20:05.971
maybe just come down
sometimes for a game
20:05.971 --> 20:07.206
or for, you know, whatever,
20:07.206 --> 20:09.141
a restaurant or
Orpheum or something.
20:10.676 --> 20:12.478
As you're coming down
Union towards Downtown,
20:12.478 --> 20:14.480
the big vacant lot, right?
20:14.480 --> 20:17.283
That they're, it's a,
what, billion dollar plus
20:17.283 --> 20:19.385
proposed development
over 20 years.
20:20.786 --> 20:22.288
But it's been stuck.
20:22.288 --> 20:25.291
You said it's looks like
they're about to move on that.
20:25.291 --> 20:27.026
- Yeah, they're getting close.
20:27.026 --> 20:28.894
- Do you worry about,
20:28.894 --> 20:31.464
I mean, there's still empty
spaces in Downtown, right?
20:31.464 --> 20:35.734
As much, I mean, I've worked
down there for 20 years.
20:35.734 --> 20:37.236
It lived down there off and on.
20:39.205 --> 20:41.874
How do you approach that, the
projects that get delayed?
20:41.874 --> 20:43.742
You know, I mean, we
sometimes are guilty
20:43.742 --> 20:46.345
of running a headline, you
know, billion dollar proposal,
20:46.345 --> 20:48.013
two hundred million
dollar proposal.
20:48.013 --> 20:51.150
Really though, it's not
done, it's not cooked,
20:51.150 --> 20:54.286
it's not ready and it's
years from breaking ground.
20:54.286 --> 20:55.855
How do you handle that?
20:55.855 --> 20:57.523
Do you keep pressure
on the developers?
20:57.523 --> 20:59.024
Do you just kind of
stay in touch with them?
20:59.024 --> 21:01.026
Do you ask them
to mow the lawns,
21:01.026 --> 21:02.895
and, you know,
paint the surfaces,
21:02.895 --> 21:04.130
you know, keep things tidy?
21:04.130 --> 21:05.731
I mean, how, how does that work?
21:05.731 --> 21:07.967
- Yeah, I mean for
The Walk specifically,
21:07.967 --> 21:10.636
obviously, we have a very
close working relationship
21:10.636 --> 21:12.004
because there's a lot of nuance
21:12.004 --> 21:14.740
that goes into a
project that big.
21:14.740 --> 21:17.009
There are a lot of steps
and obviously they ran
21:17.009 --> 21:20.913
into the pandemic as a part
of that so that didn't help.
21:22.114 --> 21:24.283
But in terms of how we
handle it in general,
21:25.618 --> 21:28.788
people come to us relatively
early in the process
21:28.788 --> 21:30.256
when they have an idea.
21:30.256 --> 21:33.492
Because if they're not
able to get the incentive
21:33.492 --> 21:35.227
then the rest of the
deal doesn't work.
21:35.227 --> 21:37.096
So it's only so far
that they're going to go
21:37.096 --> 21:39.498
without coming before our board
21:39.498 --> 21:41.300
and getting the approval
for the incentive
21:41.300 --> 21:43.669
and then that kicks off
a lot of the other work
21:43.669 --> 21:45.838
to do the financing,
complete drawings.
21:45.838 --> 21:48.941
And so typically when
project comes to us,
21:48.941 --> 21:52.645
they're about a year from
actually starting anyway.
21:52.645 --> 21:54.480
And sometimes they're
a little bit closer,
21:54.480 --> 21:55.848
but at least a year.
21:55.848 --> 21:58.551
And so we just continue
to talk to them.
21:58.551 --> 22:01.153
We do regular
check-ins, you know,
22:01.153 --> 22:02.588
if we hadn't heard
anything in a while.
22:02.588 --> 22:04.757
Most of the time they
keep us in the loop
22:04.757 --> 22:07.359
because there's different
questions that they have for us.
22:07.359 --> 22:08.827
- How often do you have
to go to a developer
22:08.827 --> 22:12.231
and just say, hey, we're gonna
pull back those incentives
22:12.231 --> 22:14.700
because you've
just taken too long
22:14.700 --> 22:17.069
to get going on this project?
22:17.069 --> 22:18.571
- It's happened.
22:18.571 --> 22:20.439
It hadn't happened as
much since I've been there
22:20.439 --> 22:21.874
'cause I've only been
there for a year.
22:21.874 --> 22:23.676
But I know that it's
happened in the past.
22:23.676 --> 22:26.579
And certainly when we
reached that point,
22:26.579 --> 22:28.047
we certainly will do that.
22:28.047 --> 22:30.716
For us right now, we are
reviewing our PILOT program.
22:30.716 --> 22:35.721
So it's a big deal if we
change course on a PILOT
22:36.589 --> 22:37.823
that has already been approved.
22:37.823 --> 22:39.024
Because if they
had to come back,
22:39.024 --> 22:40.259
then they would
have to be approved
22:40.259 --> 22:42.728
under whatever the new
terms of our PILOTs are.
22:42.728 --> 22:43.662
- Yeah, Bill?
22:45.030 --> 22:47.032
- And, while the incentives
provide some assurance
22:47.032 --> 22:49.735
to lenders and things like that,
22:49.735 --> 22:53.038
that's not the green
light for these projects.
22:53.038 --> 22:55.074
The lenders have a
lot more due diligence
22:55.074 --> 22:57.176
past those incentives,
don't they?
22:57.176 --> 22:59.411
- Absolutely, I mean,
the lenders want to ensure
22:59.411 --> 23:00.946
that the project
is going to work.
23:00.946 --> 23:03.883
They have to find, you know,
if there are retail spaces.
23:03.883 --> 23:05.951
They have to be
sure that they know
23:05.951 --> 23:09.822
what the tenants are going
to look like in that space.
23:09.822 --> 23:13.292
They have to secure
the equity for the deal.
23:13.292 --> 23:15.060
So they may have a
portion of the equity
23:15.060 --> 23:17.763
and they have to go and
raise the rest of the equity,
23:17.763 --> 23:19.498
whether they go into, you know,
23:19.498 --> 23:22.935
large New York Wall Street
groups for that equity
23:22.935 --> 23:26.538
or trying to find local
people to put in equity
23:26.538 --> 23:27.773
on the projects.
23:27.773 --> 23:29.942
They still have quite
a bit of work to do
23:29.942 --> 23:32.111
in order to get those
deals finalized.
23:32.111 --> 23:36.715
- Are they as leery
as Eric talked about
23:36.715 --> 23:40.019
of, okay, there's all
this big bang of publicity
23:40.019 --> 23:41.687
about this project.
23:41.687 --> 23:45.524
And they're the folks who
have to get to the real meat
23:45.524 --> 23:47.092
of the matter on this.
23:47.092 --> 23:49.428
So I would imagine in some cases
23:49.428 --> 23:51.897
that they can be pretty
skeptical about that.
23:51.897 --> 23:54.300
- Yeah, sometimes,
but I don't think
23:54.300 --> 23:57.803
necessarily the public
pressure influences the bank.
23:57.803 --> 23:59.905
I think that, well,
obviously public pressure
23:59.905 --> 24:01.140
influences everything,
24:01.140 --> 24:03.309
but in terms of the
bank's decisions,
24:03.309 --> 24:07.046
they are more rooted in
will the project cash flow,
24:07.046 --> 24:09.948
will it be sustainable
for the term of the loan?
24:09.948 --> 24:11.917
I mean, that's what they
wanna know is making sure
24:11.917 --> 24:15.187
that the project will be
able to repay whatever debt
24:15.187 --> 24:16.655
they're taking out.
24:16.655 --> 24:19.058
And so they go through very
strenuous means to ensure that.
24:20.859 --> 24:22.161
- Just two minutes left here.
24:22.161 --> 24:23.729
I wanted to talk
about, we didn't talk
24:23.729 --> 24:26.899
about the Mobility Center
which is the big, you know,
24:26.899 --> 24:30.135
garage and retail space
and all kinds of things
24:30.135 --> 24:31.503
going in right
next to The Orpheum
24:31.503 --> 24:33.038
that people are down
there, they see that.
24:33.038 --> 24:35.174
That will be finished
real quickly--
24:35.174 --> 24:36.475
- Next summer.
24:36.475 --> 24:37.643
- Next summer.
- Next summer, summer 2023.
24:37.643 --> 24:39.578
- Okay, lemme talk for a minute.
24:39.578 --> 24:41.613
This is not enough time to
talk about it, about crime.
24:41.613 --> 24:42.848
You all don't have
a police force.
24:42.848 --> 24:43.949
You don't run the police force.
24:43.949 --> 24:45.451
I understand that.
24:45.451 --> 24:47.152
But, you know, there's a
spike in crime nationally,
24:47.152 --> 24:48.687
there's a spike
in crime locally.
24:48.687 --> 24:51.357
And it's definitely at more
of a topic of conversation.
24:51.357 --> 24:53.292
It's always been a topic
conversation in Memphis,
24:53.292 --> 24:55.594
I think in most cities,
but more so now.
24:55.594 --> 24:58.931
How do you coordinate and
what is your perception
24:58.931 --> 25:00.432
of what's going on with crime
25:00.432 --> 25:02.968
and what would you like to see
the police force do more of,
25:02.968 --> 25:04.403
or the city do more of?
25:04.403 --> 25:06.638
Or is that not even something
that you yourself with?
25:06.638 --> 25:09.041
- Oh yeah, we certainly
concern ourselves with it.
25:09.041 --> 25:11.777
We are funded by a
commercial assessment
25:11.777 --> 25:14.246
on commercial property
owners in Downtown Memphis.
25:14.246 --> 25:16.949
So when things are going awry,
they certainly let us know
25:16.949 --> 25:19.251
and they want us to
act on their behalf.
25:19.251 --> 25:22.955
And so we coordinate with
Memphis Police Department
25:22.955 --> 25:24.390
on a regular basis.
25:24.390 --> 25:27.393
I recently had a meeting
with Chief Davis and her team
25:27.393 --> 25:30.729
and we talked about some
things that we can do
25:30.729 --> 25:33.165
to make Downtown safer.
25:33.165 --> 25:36.602
We're looking at some lighting
strategies being funded
25:36.602 --> 25:38.404
by Shelby County Commission
25:38.404 --> 25:41.340
where we're gonna increase
the light in different areas.
25:42.274 --> 25:44.977
The MPDs looking
at bike patrols,
25:44.977 --> 25:47.279
some things that they can add.
25:47.279 --> 25:48.514
We're doing some things
25:48.514 --> 25:51.884
to reduce some of
the chaotic activity
25:51.884 --> 25:54.219
by having some of the
scooters cut off late at night
25:54.219 --> 25:57.556
'cause sometimes the scooters
dart in and outta traffic.
25:57.556 --> 25:59.691
On late nights, and that's
just not a good mix.
25:59.691 --> 26:04.029
And so we concern ourselves
quite a bit with public safety
26:04.029 --> 26:05.297
and our goal is to coordinate
26:05.297 --> 26:06.999
with our Blue Suede
Brigade team, MPD
26:09.168 --> 26:10.669
and even the
Sheriff's Department.
26:10.669 --> 26:12.070
- Okay, well again, I
didn't give you enough time,
26:12.070 --> 26:13.572
but I appreciate
you answering that.
26:13.572 --> 26:14.540
Thank you for being here, Paul.
26:14.540 --> 26:15.774
Thank you Bill.
26:15.774 --> 26:16.809
That is all the time
we have this week.
26:16.809 --> 26:18.043
If you missed any of the show,
26:18.043 --> 26:20.379
you can get the full
video at wkno.org
26:20.379 --> 26:22.080
or you can get the full
podcast of the show
26:22.080 --> 26:23.982
at The Daily Memphian
site, iTunes, Spotify,
26:23.982 --> 26:25.317
or wherever you
get your podcasts.
26:25.317 --> 26:26.718
Thanks and we'll
see you next week.
26:26.718 --> 26:30.255
[intense orchestral music]
26:30.255 --> 26:32.257
[acoustic guitar chords]