Saturday, January 31, 2009
Thursday, January 29, 2009
Wednesday, January 28, 2009
Detroit suffers from some of the same issues as St. Louis – namely, widespread abandonment of its urban center by residents and businesses – albeit on a larger scale.
The Motor City, however, has taken some major steps to stem its decline and could serve as a model for St. Louis.
In St. Louis, Ernst & Young gave up on downtown. In 2001, despite aggressive lobbying from the city, the firm abandoned 86,000 sf of space in Gateway One for approximately 100,000 sf in the Plaza in Clayton. The move was a major blow to downtown St. Louis, costing the city 715 jobs.
At the time, Turk Turley of Colliers Turley Martin Tucker commented, “There are opportunities for them (Ernst) downtown," Turley said. "They could take care of their needs in the building they're in.” The Business Journal mentioned that the city was prepared to offer an incentive package that would more than offset the 1% earnings tax and negate any potential cost savings associated with moving to Clayton.
But Ernst & Young chose to move anyway.
In Detroit, however, Ernst & Young played a major role in that city’s nascent revitalization, signing on as a tenant in a new Class A office building – the first new office space constructed in Detroit since the 1970s.
Like St. Louis, Detroit has secondary business districts – such as Southfield – that compete with the CBD. Ernst & Young could have easily taken the same approach in Detroit that they did in St. Louis, leaving for supposedly greener pastures. However, the firm recognized its importance to Detroit’s CBD, and by making a commitment to downtown Detroit, it has done its part to reverse the trends of the past. Detroit is probably the only city I can think of - other than St. Louis - that would have a firm like Ernst & Young in a suburban location, and yet it doesn't.
Why couldn’t that have happened here?
Tuesday, January 27, 2009
Apparently Husch was looking for new Class A space, one thing that downtown cannot currently offer but desperately needs in order to attract and retain tenants.
It doesn’t have to be a 50-story tower.
It doesn’t have to be part of a mixed-use “entertainment district” or some other grandiose concept.
It doesn’t need to overlook the ballpark.
It just needs to be high quality space, with sufficient parking and other amenities that tenants like Husch require.
According to the Business Journal...
St. Louis Deputy Mayor Barb Geisman said the city presented Husch Blackwell Sanders several sites downtown where the law firm could build an office tower. “We are working on a couple of new office building sites that, start to finish under the best circumstances, would take two years,” Geisman said.Husch, which left the Bank of America Tower downtown for Clayton in 2002, now leaves behind approximately 80,000 sf of space in the Laclede Gas Building. In this economy, that space may prove challenging to fill.
Sometimes it’s difficult to stay optimistic about downtown’s future, when people and firms that could really make a difference in revitalizing downtown decide to turn their back on it.
Monday, January 26, 2009
Friday, January 23, 2009
Downtown revitalization is important to regional economic success - 4.3
Downtown is more attractive/inviting now than 2-3 years ago - 3.7
Downtown would be a good place to live (not for me) - 3.4
Downtown is region’s most important business/employment center - 3.3
Downtown would be a good place to work - 3.3
Downtown would be a good place for me to live - 2.0
I'd like to see a little higher score in the "region's most important business/employment center" category, but these results may be an indication that the public's perceptions towards downtown are starting to change for the better.
Thursday, January 22, 2009
Break out your checkbooks, the Renaissance Grand Hotel & Suites is set to be auctioned off on February 2.
An investor with deep pockets could pick up the property for a relative song, with the $277 million hotel going for as little as $50 million. So who will step up to the plate and take ownership of St. Louis' convention hotel? The Business Journal mentions the Roberts Brothers among the potential bidders.
In the meantime, according to Pam Blase, a spokesperson for UMB Financial Corp., the bondholders' trustee:
“We want to make clear that it’s the bondholders' intention that the hotel remains open and the operations continue uninterrupted. Marriott is going to continue to manage the hotel, and it’s business as usual. There is no change in management or service levels as a result of the foreclosure notice.”
As for the city's interests, according to the excellent article in the Business Journal:
Steve Stogel, principal of DFC Group, is working on behalf of the city of St. Louis to find a new owner for the hotel. The city issued a Section 108 loan of $50 million that has been paid down to approximately $43 million. Stogel said the city is protected in its investment on the Renaissance and a land-use restriction requires the owner to maintain the property as a four-star hotel. City PILOTs (property tax payments in lieu of taxes) are in first position on the title, he said.
It will be interesting to see what happens...
Wednesday, January 21, 2009
According to festival organizer Lou Mueller:
"We looked at the demographics of it. People just weren't coming downtown. We feel we're closer to a mass of people that don't have to come as far."
I don't believe that moving Strassenfest will have much of an economic impact on downtown St. Louis; however, I don't like the message that moving the festival sends - that a successful event cannot be held in downtown St. Louis. I beg to differ.
Unlike Chesterfield, or any other part of the region for that matter, downtown is designed to accomodate crowds and serve as the public gathering place for major events such as the Strassenfest. I have a hard time believing that it's downtown's fault that the event has not been as successful recently as it had in years past.
I've attended a few Strassenfests in recent years and have generally found the festival to be lacking in terms of programming and identity. It largely featured the same beer booths and funnel cakes that you can find at just about any other fair (or even church picnic), with occasional polka music to make it "authentic."
A poor-quality event, combined with the fact that the Strassenfest had traditionally been held in the sweltering heat and humidity of first week of August - easily the most miserable time in which to hold any outdoor event in this part of the country - are most likely the reasons behind the festival's dwindling attendance in recent years, not because it was held downtown. Hold the Strassenfest downtown in the cooler weather of September 18-20 (the dates of the upcoming Chesterfield Strassenfest), and I'm fairly confident the event would be much better attended.
Tuesday, January 20, 2009
Possibly one of the most non-descript - but handsome - buildings downtown, 1133 pine is listed for sale for $2,500,000. To my knowledge, it is completely vacant.
This 28,122 sf building is being marketed for office use or loft conversion. Its marketability is bolstered by the fact that it includes its own parking lot - a lot that would be great for a small infill project or building addition.
Robert Biggs is the listing agent - (636) 225-8585.
Monday, January 19, 2009
Friday, January 16, 2009
Some winners of the RCGA’s Right Arm of St. Louis award use their acceptance speeches to propose bold new initiatives. John Bachmann, who accepted the award Thursday night, presented a wish list of ongoing projects that he wants to see succeed — the BioBelt effort to support the life sciences, the attempt to get Ballpark Village built, and so on. He did strike one bold note at the end of his list, though: Bachmann said he’d like to get rid of St. Louis’ city earnings tax. He called it “one of the region’s great speed bumps.” Bachmann, a senior partner at Edward Jones, is also a former chairman of the Regional Chamber and Growth Association.
In the past, I've made the argument that most other major cities also have earnings taxes that don't seem to be hindering the growth of their CBDs any. However, I now think that this is a bit of an apples-to-oranges comparison that ignores just how unique St. Louis is.
And the reason why it's difficult to compare St. Louis to other cities stems from the "Great Divorce" between St. Louis City and County.
If our city fathers actually had the foresight to expand the city's boundaries beyond Skinker Blvd. to, say Lindbergh or 270, the earnings tax would be much less of a deterrent as there's a good chance that the CBD's biggest competitor for office tenants - downtown Clayton (at least as we know it today) - would not be a factor.
If the city of St. Louis was part of St. Louis County - and the county seat of St. Louis County - the problem would not be as bad. Instead, as an entity independent of the city of St. Louis, St. Louis County chose Clayton as its county seat. And of course, as county seat, Clayton became home to the county courthouse and a business district sprang up around it. Would downtown Clayton as we know it today even exist if the city of St. Louis was the county seat of St. Louis County? I'm not so sure.
Instead, the CBD is in competition with a secondary business district that is in very close proximity and is not hampered by the earnings tax. The playing field needs to be leveled before the next Ernst & Young, Armstrong Teasdale or Husch & Eppenberger decides to jump ship.
Thursday, January 15, 2009
Suite 575 is 5,284 sf and is available at $21.00 psf. It would be a great space for a small law office or other professional services firm. The huge windows overlooking Washington Avenue are a big plus.
One Financial Plaza has been filling up, with Stifel Nicolaus now taking up over half of the fifth floor, in addition to the space it already leases on the first, seventh, eighth and ninth floors. Jacobs Engineering, Gateway EDI, Milliman, BKD LLP, Fox Architects and the Federal Reserve are the building's other tenants.
The only other suites available are 3,532 sf on the tenth floor and 21,076 sf on the twelfth floor.
Tony Kennedy and Todd Sorter of EVS Realty Advisors are the listing agents - (314) 241-1175 and (314) 770-1700, respectively.
Wednesday, January 14, 2009
1) The northeast corner of Broadway and Washington. There are actually two large lots at this site, split by Lucas Street, which, despite its name, is actually more of an alley. I like this location for several reasons:
- High visibility, prominent Washington Avenue address
- Close proximity to the convention center and numerous hotels
- Ample parking available in the Missouri Athletic Club, Drury Hotel and Hampton Inn garages as well as sufficient room on which to construct a new garage (on the northern end of the site, with the building fronting Broadway)
- Great accessibility - easy to access from 70, the Eads Bridge, 40 via Broadway and 44/55 via Memorial Drive.
2) The vacant lot on Broadway at Spruce, immediately east of Busch Stadium. Ballpark Village benefits without actually being in Ballpark Village. This site offers unbeatable visibility thanks to baseball traffic and proximity to Highway 40, and if Ballpark Village ever gets built, this site will become even more attractive. A building on this site would be served by the two stadium garages and various parking lots south of Highway 40, as well as any parking that may be added to Ballpark Village. It's still somewhat isolated and distant from the heart of downtown though, with few dining options (at least until Ballpark Village is built). Also offers the same easy highway access as the Broadway/Washington lot.
Other attractive sites include: the northwest corner of Tucker and Olive (underutilized site occupied by a U.S. Bank branch), 11th and Locust (a huge sea of parking lots), 9th and Clark (odd greenspace adjacent to the Eagleton Courthouse).
The market conditions are right - it's imperative that new space be developed in order to attract new firms to downtown and retain existing ones.
Tuesday, January 13, 2009
At the moment, just 18,052 sf is available out of a total of 248,651 sf, giving the building an occupancy rate of over 93%. Space in the Deloitte Building goes for $16.50-$17.00 psf, which is a relative bargain.
Deloitte and Touche occupies 40,000 sf on two floors, having moved from One City Centre a few years ago. Polsinelli, Stinson Morrison Hecker, Rabbit Pitzer & Snodgrass, Waylon Advertising and Beech-Nut Nutrition are among the building's other major tenants.
Instead of waiting on Ballpark Village, the Bottle District, or any other pie-in-the-sky developments, it surprises me that no developers have ever stepped up to construct a new class A building similar in size and quality to the Deloitte Building. I can think of a few locations that would be perfect for such a building...
Monday, January 12, 2009
The building really looks great these days, with its glazed terra cotta facade gleaming white and its trim freshly painted. It seems hard to believe that the May Co. was once hell-bent on getting it torn down.
Hopefully, we'll hear news of new tenants moving in soon.
Friday, January 09, 2009
Chivvis Development recently announced that Black Label – an art gallery/lounge concept – will be opening in the former Bushwoods space at 758 South Fourth Street.
Black Label's gallery element will flaunt the unique talent of local artists as well as invited, national talent. Artwork will be displayed around the lounge for viewing and for purchase. Rotating artwork monthly, Black Label will keep customers eager to see what's new as well as host special events to showcase different types of artists, from body painting and sketches to the sounds of local musicians.I like the gallery part, not to keen on the lounge part. Places like this tend to emphasize the latter over the former. Nonetheless, it will be great to have something go into that vacant space.
Black Label will also serve as a popular lounge for networking and socializing among business professionals, art followers and party-goers. With a convenient location three blocks from Busch Stadium, Cardinals' fans will be able to enjoy pre-game and post-game attractions, as well as a free shuttle to and from the games. With a premium drink selection and outstanding customer service, Black Label will be a destination known for its unique ability to provide a distinct experience to all visitors.
Thursday, January 08, 2009
One quick blurb from Bill McClelland's recent column:
A few years ago, the lunch crowd began to dwindle. That had more to do with the declining population of downtown workers than with the food, which remained inexpensive (the daily special was $3.50) and authentic.Maybe to some extent, but I would wager that the decline in Dapper Dan's business was more likely the result of the closing of the Jefferson Arms apartments - having a couple hundred senior citizens right across the street likely provided the bar with a steady stream of customers.
One could also attribute the bar's decline to its general appearance. The place was a little rough around the edges and really smokey. Not necessarily the type of environment in which most people want to spend their lunch hours these days.
Still the place had loads of character and personality, and I'm sad to see it go. I'd love to see a new owner give the place a makeover and a new life.
Wednesday, January 07, 2009
The article touched on McGowan's desire to build a signature skyscraper downtown, something that has been discussed in urbanist circles for some time now:
(McGowan) is even passionate about building a new skyscraper that symbolizes St. Louis to the world. McGowan was ready to announce the project a year and a half ago, but he's put it on hold until the economy rebounds. Still, he's adament that it will come to fruition.
"We built something that the world knows, but the Arch is a glass ceiling in development in St. Louis, in that we don't build anything higher," he says. "The shadow of the tower I propose will extend to Chicago, Dallas and beyond."
Does it make me a pessimist if I don't think this is a good idea?
While I would certainly love to see a new office tower like the one Mr. McGowan describes, filling such a building would be a difficult undertaking, and doing so would likely result in the emptying of other downtown class A buildings. The construction of Met Square, for example, flooded downtown with office space and resulted in a game of musical chairs, with many downtown firms leaving their existing space for Met Square. In many ways, the downtown office market hasn't fully recovered.
For McGowan's tower to be a true success, he would need to attract large users from the suburbs and beyond, which Met Square was largely unable to do. I would guess that he would probably want to incorporate residential units and maybe even a hotel, which would help prevent another Met Square-like situation. I'm not saying it can't be done; it would just be difficult to do. I wouldn't bet against McGowan though.
Tuesday, January 06, 2009
According to the Business Journal:
Getting the store up and running is estimated to cost $7.56 million. Schnuck Markets is paying $3.42 million for tenant improvements, inventory and other opening expenses. The remainder is coming from a combination of state, federal and city subsidies, including the federal New Markets Tax Credits.It's great to see this project moving forward. Hopefully Schnucks and City Grocers can successfully co-exist, despite their proximity.
Monday, January 05, 2009
The $21 million project will feature ground floor retail space and four floors of loft apartments. Kennedy and Associates - a design-build firm - will take two floors of the building for its offices, moving its 95 employees from Met Square.