The Walk on Union | $950M mixed-use development proposed for Downtown

[jjbradleyBrooklyn]

1 hour ago, Memphisborn said:

https://www.commercialappeal.com/story/money/business/development/2022/04/12/downtown-memphis-development-the-walk-on-union-avenue/9504712002/

They have until end of year to show they secured financing 

I'm wondering why they can't just start with 1 residential building, get financing for that, and do it super slowly, just to kick off construction. 

If it's a struggle to obtain financing at, for example, the $350 million point, reduce the plans initially, and focus on 1 building at $90-$100 million or so. Then break down the phase 1 into 3 phases, and at least get that chunk financed and built out. Then take slow steps to secure the rest of it, based on the success of the first phase.

Or, something like that. I dunno, I mean, it's a ton of money, no matter how you slice it. But it's the standard amount for developments this size and in this current market.

[Memphisborn]

2 hours ago, jjbradleyBrooklyn said:

I'm wondering why they can't just start with 1 residential building, get financing for that, and do it super slowly, just to kick off construction. 

If it's a struggle to obtain financing at, for example, the $350 million point, reduce the plans initially, and focus on 1 building at $90-$100 million or so. Then break down the phase 1 into 3 phases, and at least get that chunk financed and built out. Then take slow steps to secure the rest of it, based on the success of the first phase.

Or, something like that. I dunno, I mean, it's a ton of money, no matter how you slice it. But it's the standard amount for developments this size and in this current market.

Yea I hear u, I’m not exactly sure why they have stalled on breaking ground outside of rising construction cost due to pandemic. However I would agree that taking a one Beale approach would be good. Start with residential component to jump start construction and interest and build out from there. I will say this project was a much anticipated and highly transformative initiative that brought the governor and much media attention. If this doesn’t happen it will be a huge black eye to city worse than the Lowes debacle. 

[DRG901]

Agree with both posts above-- I was under the impression the residential portion was already supposed to start before hotel/office/etc and figured that would've been easier to get going since there's still more residential projects that are getting built downtown.   And with regards to One Beale I felt the same way and that's what scares me.   Seems to be the same situation with a looming recession- came back with a similar plan and then they had other issues after the second proposal with the father dying when it was supposed to get off the ground and had to re-group and then came back with the scaled down plan that's finally been built  (I can't recall all the details) but it eventually got going and still seems to be getting a hotel tower in the original planned spot (although also scaled back a bit).   So I am hopeful but skeptic as always as I've become accustomed to around here.   Hopefully something comes out soon...not sure I'd think of it as a Lowe's debacle.  With that there seemed to be a  lot more city involvement with plans etc including 100 N Main.  At least with this the developers knocked down about 30 acres of blight that was an eyesore heading into downtown-- so hey, at least a clean slate for whatever may happen.

[jjbradleyBrooklyn]

As October draws to a close, and 2022 starts to soon wrap, does anyone think the Walk actually gets financing (phase I) and sets a date to start construction in Q1 or Q2 of 2023? 

My thinking is that this project has become even more of a longshot since interest rates, risk of recession and declining economy are now a part of the conversation.

I'm still optimistic but this might've stalled.  Anyone know of anything?

[Memphisborn]

2 hours ago, jjbradleyBrooklyn said:

As October draws to a close, and 2022 starts to soon wrap, does anyone think the Walk actually gets financing (phase I) and sets a date to start construction in Q1 or Q2 of 2023? 

My thinking is that this project has become even more of a longshot since interest rates, risk of recession and declining economy are now a part of the conversation.

I'm still optimistic but this might've stalled.  Anyone know of anything?

I don’t have any first hand knowledge however I agree with u that the project is questionable. It’s been long enough and let’s all keep in mind this project had full financial support from city/ county gov. I’m hopeful but unsure as to where this project stands. Like a previous poster stated worst case scenario is a blank canvas of 30 acres for a new project to move forward. I’ll be disappointed if this project fails my honest feeling. 

[MDC26]

On 10/29/2022 at 2:58 PM, Memphisborn said:

I don’t have any first hand knowledge however I agree with u that the project is questionable. It’s been long enough and let’s all keep in mind this project had full financial support from city/ county gov. I’m hopeful but unsure as to where this project stands. Like a previous poster stated worst case scenario is a blank canvas of 30 acres for a new project to move forward. I’ll be disappointed if this project fails my honest feeling. 

My thoughts are the same. This project was announced at least 4 years ago. All they’ve done is purchased the land, drawn up plans, and cleared the land. No construction. If they haven’t acquired financing by now, I think it’s highly unlikely they will with where interest rates have risen. The interest rates alone, will make many projects infeasible. Unlikely there’s something to take it’s place at this time either. Will likely have to wait until better market conditions arise. 

[Memphisborn]

3 hours ago, MDC26 said:

My thoughts are the same. This project was announced at least 4 years ago. All they’ve done is purchased the land, drawn up plans, and cleared the land. No construction. If they haven’t acquired financing by now, I think it’s highly unlikely they will with where interest rates have risen. The interest rates alone, will make many projects infeasible. Unlikely there’s something to take it’s place at this time either. Will likely have to wait until better market conditions arise. 

Sad but true, there isn’t anything that would happen right now @ that site. Let’s see if they can finalize financing by December. I would hate to see this fail but it’s leaning in that direction right now. 4 years is long enough to have completed financing. This project was started prior to Covid. Financing should have been more solid. 

[Wayward Memphian]

Financing is getting more and more expensive.

 

Memphis momentum is going to once again suffer from the financial markets because things seem to slow to a crawl here development wise.

[VSRJ]

I love Memphis so much, but the speed in which developments move forward is so painfully slow. I hope it changes someday.

[dxfret]

With a recession underway this project will not happen for the foreseeable future.  The cost of borrowing money at today’s interest rates are just too high and in a tepid market like Memphis the financial risks are not justifiable.  Big scale projects are only happening in booming cities like Austin and Nashville. 

[MDC26]

12 hours ago, Memphisborn said:

Sad but true, there isn’t anything that would happen right now @ that site. Let’s see if they can finalize financing by December. I would hate to see this fail but it’s leaning in that direction right now. 4 years is long enough to have completed financing. This project was started prior to Covid. Financing should have been more solid. 

It's such a huge project, that its more difficult to get financing lined out.  I know they had it split up into phases, but maybe they should have broken it up into even more phases and could have had one or two buildings at a time.  

[jjbradleyBrooklyn]

2 hours ago, dxfret said:

With a recession underway this project will not happen for the foreseeable future.  The cost of borrowing money at today’s interest rates are just too high and in a tepid market like Memphis the financial risks are not justifiable.  Big scale projects are only happening in booming cities like Austin and Nashville. 

Yeah, unfortunately I believe this is the case. The developers were optimistic with this, and the plans are phenomenal. But for a city like Memphis, EVERYTHING has to fall in line for development projects on this scale to happen--financing, timing, demand, approvals, permits, infrastructure development, etc. 

Memphis is unfortunately seen as a risky market as-is, with developments.  Placing another stresser over large-scale would-be projects.

2 hours ago, dxfret said:

With a recession underway this project will not happen for the foreseeable future.  The cost of borrowing money at today’s interest rates are just too high and in a tepid market like Memphis the financial risks are not justifiable.  Big scale projects are only happening in booming cities like Austin and Nashville. 

Also, mid-sized cities seeing big scale projects happen fast are pretty much now only Austin and Nashville. Raleigh and Charlotte are also seeing things happen fast, in that size group. 

But unfortunately very slow growing (and declining in some areas) cities of Memphis' size are not seeing much happen any longer--on this scale. 

I think this property will wait out what happens with the economy for a couple more years, and then a development or two may go in there. But, as Memphis and development normally occurs, it will be slow as molasses.

Edited October 31, 2022 by jjbradleyBrooklyn

[The Guardian of Memphis]

I hate the slowness too, but on the bright side so much has been done, with so much left to do. It didn't happen overnight either. The density in South Main/South Front is definitely something to proud of. At least there's something to build on (Pinch, the proposed Clipper, the Walk, Sterick) with heightened expectation. Once it's all said and done, it will produce much joy and relief when these projects are completed knowing there was a long wait. Let's never stop dreaming.

[James Owen]

1 hour ago, The Guardian of Memphis said:

I hate the slowness too, but on the bright side so much has been done, with so much left to do. It didn't happen overnight either. The density in South Main/South Front is definitely something to proud of. At least there's something to build on (Pinch, the proposed Clipper, the Walk, Sterick) with heightened expectation. Once it's all said and done, it will produce much joy and relief when these projects are completed knowing there was a long wait. Let's never stop dreaming.

It took almost two decades and several redesigns later to get One Beale off the ground in its current form - with the Grand Hyatt being one of the final pieces of the puzzle. I doubt we will have to wait just as long to see some movement on The Walk if demand for new housing downtown continues to grow.

We'll probably hear something before year's end since the developers' current PILOT application has a deadline (Dec 31) to secure financing - which most likely will be extended due to changes in lending and interest rates going up.

[MDC26]

7 hours ago, James Owen said:

It took almost two decades and several redesigns later to get One Beale off the ground in its current form - with the Grand Hyatt being one of the final pieces of the puzzle. I doubt we will have to wait just as long to see some movement on The Walk if demand for new housing downtown continues to grow.

We'll probably hear something before year's end since the developers' current PILOT application has a deadline (Dec 31) to secure financing - which most likely will be extended due to changes in lending and interest rates going up.

It doesn't happen now, it definitely could happen later on, but likely not until economic conditions improve.  The PILOT approval expiring does not concern me at all.  If they get financing and are ready to start construction in 6 months and ask for the PILOT to be re-approved because they won't be able to do the project without the PILOT, no way the city says "Nope, it expired, sorry."  

[jjbradleyBrooklyn]

On 11/1/2022 at 11:03 AM, MDC26 said:

It doesn't happen now, it definitely could happen later on, but likely not until economic conditions improve.  The PILOT approval expiring does not concern me at all.  If they get financing and are ready to start construction in 6 months and ask for the PILOT to be re-approved because they won't be able to do the project without the PILOT, no way the city says "Nope, it expired, sorry."  

This is a good point and very true.

My guess is it will happen later on, in a changed form, and more piecemeal development, but that area will be developed, ultimately.

In a city like Memphis, large scale brand new developments don't happen often, and when they do, they move slowly. 

This area is just an absolute no-brainer for residential and hotel. I think that part is the piece of the puzzle that is so frustrating. Everyone has seen the Walk development plans, realize the need is there, wants it to happen, and wants it to happen like yesterday.

I just wonder if the developers of this bit off way more than they can chew, in terms of loan size and financing? Or, is it just the case of this development being in the city of Memphis, making potential would-be financiers to pause and say "no, we can't see that working in a city like Memphis. It's too risky a location." 

My opinion is a bit of both. But we shall see! I remain optimistic.

Edited November 2, 2022 by jjbradleyBrooklyn

[JTM1]

On 10/31/2022 at 9:59 AM, MDC26 said:

It's such a huge project, that its more difficult to get financing lined out.  I know they had it split up into phases, but maybe they should have broken it up into even more phases and could have had one or two buildings at a time.  

I'm not going to say much, but I know someone that has been working on the design. It's still a go. 

[dxfret]

The negatives aspects of Memphis have been well known for decades. Crime, poverty, declining population, tepid economy, unskilled workforce, and weak leadership are important reasons why big things rarely happen in the Bluff City.  Outside big investors have long been wary of Memphis, and the local good ole boys like Carlisle are too small to successfully deliver.  This project may eventually happen, but today’s economic conditions are the major roadblock.

[jjbradleyBrooklyn]

38 minutes ago, dxfret said:

The negatives aspects of Memphis have been well known for decades. Crime, poverty, declining population, tepid economy, unskilled workforce, and weak leadership are important reasons why big things rarely happen in the Bluff City.  Outside big investors have long been wary of Memphis, and the local good ole boys like Carlisle are too small to successfully deliver.  This project may eventually happen, but today’s economic conditions are the major roadblock.

This is well said. 

Memphis has had these challenges for decades--the important points that have really held Memphis back. 

Good call out about the "local developers to small to successfully deliver." This is largely true, and many mid-sized cities (and a few larger) suffer from the same "regional developer important-ism."  

They can't build too big because it's financially out of their scope and ability to move things forward, yet they do smaller scale buildings and residential just fine, consistently.

I agree that this project will most likely eventually happen in some form or another, but as most every development in Memphis, it will move when it's good and ready to move. Which usually means close to a decade of waiting, in many situations.

[MDC26]

1 hour ago, jjbradleyBrooklyn said:

This is well said. 

Memphis has had these challenges for decades--the important points that have really held Memphis back. 

Good call out about the "local developers to small to successfully deliver." This is largely true, and many mid-sized cities (and a few larger) suffer from the same "regional developer important-ism."  

They can't build too big because it's financially out of their scope and ability to move things forward, yet they do smaller scale buildings and residential just fine, consistently.

I agree that this project will most likely eventually happen in some form or another, but as most every development in Memphis, it will move when it's good and ready to move. Which usually means close to a decade of waiting, in many situations.

Are you just an alternate account for dxfret?  Both are from New York.  Both only post in Memphis and Nashville forums.  Both only post negative stuff in Memphis forum and positive stuff in Nashville forum.  You've got to be the only person that's ever said dxfret's comment was well said.  

[jjbradleyBrooklyn]

11 minutes ago, MDC26 said:

Are you just an alternate account for dxfret?  Both are from New York.  Both only post in Memphis and Nashville forums.  Both only post negative stuff in Memphis forum and positive stuff in Nashville forum.  You've got to be the only person that's ever said dxfret's comment was well said.  

No I'm not an alternate account. 

I agree that Memphis has its development challenges--and what @dxfret listed is pretty spot-on for Memphis, historically, despite being hard to hear.

I'm a huge advocate for Memphis development and growth. I love the city and its potential, but for many reasons, the city does not compete that well with its peers.

Hopefully that can change in the future though.

Edited November 4, 2022 by jjbradleyBrooklyn

[Memphisborn]

11 hours ago, jjbradleyBrooklyn said:

No I'm not an alternate account. 

I agree that Memphis has its development challenges--and what @dxfret listed is pretty spot-on for Memphis, historically, despite being hard to hear.

I'm a huge advocate for Memphis development and growth. I love the city and its potential, but for many reasons, the city does not compete that well with its peers.

Hopefully that can change in the future though.

Well, I’m a native Memphian and unfortunately this has some truth. Lowes development delays then scrapped. Walk on union delayed. Blue Note Hotel delayed. Dream Hotel delay. Took 8 years for pyramid bass pro. List goes on. We have the potential to be Next hot southern city however we have to do what other hot, progressive metro cities do, efficient, effective development projects and consolidate our government. The  bond market has something to do with stalled projects here but that’s not the only issue better leadership, bigger tax base and vision is also a issue. That’s just the truth 

[JTM1]

On 11/4/2022 at 7:27 AM, dxfret said:

The negatives aspects of Memphis have been well known for decades. Crime, poverty, declining population, tepid economy, unskilled workforce, and weak leadership are important reasons why big things rarely happen in the Bluff City.  Outside big investors have long been wary of Memphis, and the local good ole boys like Carlisle are too small to successfully deliver.  This project may eventually happen, but today’s economic conditions are the major roadblock.

What do you mean by "big things rarely happen" in the Bluff City? I see a lot of big things happening in Memphis.  It's unfortunate that you have such cynical view of Memphis, because as long as I have lived in the city, I have seen nothing but positive change and growth.  Outside investors, along with local developers are pouring billions in the city and there is a lot more to come. 

[Memphisborn]

50 minutes ago, JTM1 said:

What do you mean by "big things rarely happen" in the Bluff City? I see a lot of big things happening in Memphis.  It's unfortunate that you have such cynical view of Memphis, because as long as I have lived in the city, I have seen nothing but positive change and growth.  Outside investors, along with local developers are pouring billions in the city and there is a lot more to come. 

Agreed big things have happened, crosstown concourse, TN Brewery, FedEx Forum. FedEx Logistics HQ, Service Master HQ @ Peabody place. TLP, list goes on. I believe we are on the right path of success however my argument is we need consolidated government(bigger Tax Base) And more efficient out the ground projects. Sadly these delays are an embarrassment not saying all the blame is on city gov. The need to better vet these developers and there capital and timeline to break ground is a glaring issue. 5million dollars short??? WTH!! That should be non issue take it out on the backend from tourism surcharge/ pilot/ tif or other incentives that have been granted. That’s just ridiculous to stall a major project over 5 million. IMO

Edited November 5, 2022 by Memphisborn

[The Guardian of Memphis]

On 11/4/2022 at 9:41 PM, Memphisborn said:

Well, I’m a native Memphian and unfortunately this has some truth. Lowes development delays then scrapped. Walk on union delayed. Blue Note Hotel delayed. Dream Hotel delay. Took 8 years for pyramid bass pro. List goes on. We have the potential to be Next hot southern city however we have to do what other hot, progressive metro cities do, efficient, effective development projects and consolidate our government. The  bond market has something to do with stalled projects here but that’s not the only issue better leadership, bigger tax base and vision is also a issue. That’s just the truth 

I wouldn’t blame everything on leadership, but I’m not ashamed enough to say that things could be better with all the facts that our honorable fellow poster jjbradley has brought out. He does make balanced posts and doesn’t go to the extreme. However, I have not seen his posts in other forums, but I will say that I hope his critiques of other cities are the same as it is here. There seems to be a propensity to always point out the negatives of Memphis no matter what. There’s always a catch. From my views of other forums, it only seems to be in this one. I don’t know why Memphis is always an easy target for people to throw darts at. Not a boo hoo statement but it’s true. Tired of that.