Document Sample
ONLINE Powered By Docstoc
					                                                                                              Southeast City Highlights p. 21

                                                                                              Southeast Snapshots p. 25

                                                                                              Office & Industrial Lenders Guide p. 20

Volume 9, Issue 11                                                    february 2009                                                

 ARKANSAS         •        AlAbAmA      •               floRidA      •                 geoRgiA       •       KeNtucKy         •      louiSiANA            •      mARylANd
 miSSiSSippi      •      NoRth cARoliNA •              South cARoliNA •                teNNeSSee    •     viRgiNiA •          wAShiNgtoN, d.c.        •       weSt viRgiNiA

CottonMill project brings retail, housing.
Jon Ross

     n Starkville, Mississippi, a small town of nearly
     25,000 close to the state’s eastern border, the
     main draw is Mississippi State University. People
 come to the university for academics, arts events
 and Southeastern Conference sports. Historically,
 Starkville’s size and isolated location meant that
 once those visitors arrived, access to significant retail
 required a lengthy car ride to Tupelo or Tuscaloosa,
 Alabama. With the addition of the 746,196-square-
 foot CottonMill Marketplace, a $216 million mixed-
 use development that will sit adjacent to the univer-
 sity campus, developers are hoping retail becomes a
 new reason to visit Starkville.
    “This town wants a lot of retail,” says Jon May-
 nard, president of the Greater Starkville Develop-
 ment Partnership. “They see a growth in retail as
 being a success point for the community. We’re fairly
                          SEE REVIVAL, PAGE 28                        coTTonmILL mARKETPLAcE In STARKVILLE, mISSISSIPPI.

  Visit tHE rEdEsiGnEd                                                                      SoUTHEAST FInAncIAL UPDATE
    REBUSINESS                                       • Top Stories
                                                   • Free Newsletter                        Small banks, apartment deals stay active during recession.
    ONLINE                                     • Timely Market Reports
                                                     • Much More
                                                                                            Jon Ross

                                                                                                   he story of the current lending    Real Estate Advisors’ Scott Bush from
                                                                                                   market is one of geography. To     his Raleigh office. Busch focuses on
                                                                                                   some extent, a city’s location     the area’s multifamily market. “Buy-
                                                                                            has always dictated what commercial       ers and sellers are still very optimistic
 Firm EyEs summEr GroundbrEakinG For atlanta apartmEnts......................... 14         property type will be a perennial hot     in this market.”
 $172 million HousinG projEct plannEd in nEw orlEans ............................ 16        item, but in this current economic cli-     Areas where the commercial real
                                                                                            mate, finding good news takes some        estate market is still relatively healthy
                                                                                            looking at the map. A city hit hard       have one thing in common: regional
                  All stories from                                 by the recession may lie a few hours      banks rule. Unlike larger institutions,
                                                                                            away from a relative real estate oasis.   these local banks haven’t been tied
                                                                                            In Louisiana, hurricane recovery is       down by the ballooning number of
                                                                                            still fueling the real estate market,     problems the national banks are jug-
                                                                                            and in Raleigh, North Carolina, stable    gling. “Larger banks have been in
                                                                                            employment has led to a level multi-      the real estate market for a lot longer
                                                                                            family vacancy rate.                      and have had much larger allocations
                                                                                               “Many owners and regional manag-       on a year over year basis,” says Saul
                                                                                            ers have told me that Raleigh is still    Hoppenstein, who works in the Boca
                                                                                            the best performing market in their       Raton, Florida, office of Tavernier
                                                                                            portfolio,” says Sperry Van Ness| AIM     Capital Partners. “The smaller banks
                                                                                                                                               SEE UPDATE, PAGE 30
REVIVAL from page 1
remote, and people don’t necessarily       he says. “Outdoor, multi-use shop-           a former cotton mill that had found         find enough space to put on events.
want to drive an hour or two for some      ping has really become the wave of           new life as a home for the university’s     “There’s not sufficient meeting space
of the larger chain-type stores.”          the future.”                                 physical plant. The Cooley Building         for folks in attendance of over 150
   Developers COMVEST Properties              Before the project got off the ground,    was constructed in 1902, is listed on       people. There’s really not a place to
of Biloxi, Mississippi, and Jackson,       the developers met with officials from       the National Register of Historic Plac-     have a conference,” Rheams says. In
Mississippi-based Nicholas Proper-         the city and MSU to secure wish lists        es and has been designated a Missis-        addition to the on-site Marriott hotel,
ties will break ground on CottonMill       from the two institutions outlining          sippi Landmark. When the developers         conference attendees will have access
during the first quarter, aiming to        the services for which they see a need.      are finished with it, the building’s cen-   to two hotels owned by Atlanta-based
complete the project by the end of         Representatives from both organiza-          terpiece will be a 67,840-square-foot       Peachtree Hotel Group on either side
next year. Plans outline more than         tions requested expanded retail and          conference center. “This mill remains       of the development, bringing the
160,000 square feet of retail space and    office options. Starkville has some          one of the largest and most intact mill     number of hotel units in the immedi-
25,758 square feet of restaurants in an    additional office space coming online        buildings from this early period of         ate area to 500.
open-air environment. Also includ-         this year, but, for the most part, offices   industrialization in the state,” says          Reusing the Cooley Building
ed in the project is a 71,955-square-      are hard to come by. “A lot of people        Todd Sanders, tax incentives coordi-        opened up the possibility of obtain-
foot Courtyard by Marriott, 122,840        are expanding their facilities in the        nator for the Mississippi Department        ing tax credits associated with his-
square feet of office space, 216 units     county and in the city,” says Scott          of Archives and History. Due to its         torical revitalization. Developers also
of residential housing and a confer-       Rheams of COMVEST. “You can’t go             landmark status and historical signifi-     received $91 million from the GO
ence center. Retail tenants have not       up there and say, I want 10,000 square       cance, the developers had to obtain         ZONE allocation, money set aside to
been officially announced, but COM-        feet for my business; you can’t find it      a special permit before reconfiguring       help the commercial real estate indus-
VEST has secured letters of intent for     today.” At the top of the university’s       the Cooley Building. Nicholas points        try recover from Hurricane Katrina.
three junior anchors and a handful         list, however, was student housing.          out that they must outline and get any      Even with tax credits, financing was
of retailers leasing less than 10,000      Nicholas says enrollment at MSU has          structural changes approved before          difficult to find due to the economy.
square feet. “The majority of the retail   been growing at a rate of 1,000 stu-         starting construction. Also, they can’t     “It’s been a challenge,” Rheams says.
has been based in Columbus,” says          dents per year. With a requirement           add anything to the building’s façade.      “However, with the amount of incen-
Mark Nicholas of Nicholas Proper-          that freshman students live on cam-          Still, Nicholas says, it’s worth trans-     tives that we’ve been able to put
ties. “[University officials] had liter-   pus, university officials were caught        forming the inside of the property          together for this project at all levels
ally been putting their wives in a car     in a juggling act. “They were in trou-       because of the large windows and the        — from federal, state and local levels
and taking them to Columbus and            ble,” says Nicholas, an MSU alumnus          historic charm. “It’s a lot of planning     — we’ve really put together a project
had said, ‘this is where you’re going      who sent his three sons to the school        to turn a turn-of-the-century building      that when brought to the investment
to shop.’” From his position at the        as well. “They didn’t have any beds.”        into a conference center,” Nicholas         community, they can see a lot of value
Development Partnership, Maynard           The housing built at CottonMill will         says.                                       in it.” Many of these tax credits and
sees CottonMill as a regional draw.        be put on the market, but with its              A new conference center was also         financing options carry a time frame,
In addition to the tenants that will       proximity to the university, develop-        high on the wish list for both univer-      necessitating the December 2010 proj-
soon enter an area starved for national    ers are predicting the added space           sity and city officials. The university     ect deadline. The developers have
retail, CottonMill’s design, concep-       will help ease the university’s housing      is a research institution, so steady con-   planned out the project’s schedule to
tualized by CUPKOVIC architecture          burden.                                      ference activity is business as usual,      the most minute detail, and Maynard
of Cleveland, will attract attention.         At the heart of the CottonMill devel-     but in a town the size of Starkville, it    says this is a huge selling point for
“Malls in general are sort of passé,”      opment lies the E.E. Cooley Building,        was hard for conference planners to         investors. “Stability is a major draw
                                                                                                                                    for new development in an economy
                                                                                                                                    like we’ve got right now,” he says.
                                                                                                                                       The CottonMill project is expected
                                                     Redi-Dock® Provides Instant                                                    to provide a big boost to the economy.
                                                                                                                                    In its executive summary, COMVEST
                                                    Drive-In Access to Your Facility                                                officials highlight a $90 million annual
                                                                                                                                    economic impact on the city and sur-
      •   Modular                                                                                                                   rounding area. The development is
      •   Minimal site prep                                                                                                         also projected to generate a property
                                                                                                                                    tax increase of more than $1.37 mil-
      •   Low maintenance                                                                                                           lion, an annual sales tax revenue of
                                                                                                                                    between $300,000 and $450,000 and
      •   Delivered & set                                                                                                           the capacity to create 1,000 permanent
      •   Easily relocated                                                                                                          jobs. With numbers like these, Cot-
                                                                                                                                    tonMill Marketplace will have a large
      •   Lengths to 50’                                                                                                            economic impact on the Starkville
      •   Innite widths                                                                                                            market for years to come. “We could
                                                                                                                                    do a lot of other retail developments
      •   Heavy duty rating                                                                                                         on a smaller scale,” Maynard says,
                                                                                                                                    “but having one large retail develop-
      •   No future demolition                                                                                                      ment gives the town an awful lot
      •   ADA ramps available                                                                                                       of economic confidence. It will keep
                                                                                                                                    them from going out of town to spend
                                                                                                                                    money, and it will keep some of the
      Call: 800-724-4881
                                                                                                                                    outside traffic coming in to Starkville                                                                                                        rather than bypassing Starkville and                       Call for an immediate consultation.                                          going somewhere else.” q

 28                                                                       SOUTHEAST REAL ESTATE BUSINESS                                                   FEBRUARY 2009