LRT Stimulating Economic Renaissance in Charlotte

[vicupstate]

Here you go I-10east and Okla:

Apartments are sprouting at a rapid clip along Charlotte’s Lynx Blue Line in South End, as developers look to cash in on a booming rental market and cater to young professionals who want to live near uptown.

While commercial development across the region is seeing slow growth at best, the South End neighborhood has seen a spurt of new activity this year with more than $200 million worth of new construction being announced. Apartments near the Lynx line are powering the growth.

In fact, of the more than 4,000 new apartment units announced in Charlotte this year, 60 percent are within a 15-minute walk of the light-rail line, according to CoStar, a real estate analytics firm.

Two more South End complexes were announced this week, as Camden Property Trust said it would build 324 units at West Boulevard and Camden Road, and 266 units at South Boulevard and Iverson Way.

Driving the apartment boom are demographics: a growing number of young professionals who are either uninterested in owning a home or unable to because they can’t get a mortgage. Rents have been rising, and have room to rise further, said CoStar senior real estate economist Erica Champion.

“In Charlotte, you have this constant inflow of young professionals that will probably rent before they buy,” Champion said.

“(Developers) can get a huge premium being next to mass transit.”

Apartments near mass transit in Charlotte rent for an average $982 a month, compared with an overall city average of $638 a month, CoStar research shows.

Nationally, 65 percent of apartments built in metropolitan cities are within walking distance of mass transit.

“A renter is looking for convenience and lifestyle, and part of that equation is light rail,” said developer Stuart Proffitt, whose firm, Proffitt Dixon Partners, is building Fountains at South End, a 208-unit complex at the New Bern station.

The land’s former owner had planned to build a larger complex with more structured parking, partner Wyatt Dixon said.

The firm bought the land at a discount from the lender, cut the number of units and added a lounge where tenants can wait for the train.

“We bought the property at an attractive price; we had a great design for the site, and we weren’t forced to pay so much for land where we had to over-densify,” Dixon said.

The developers said competition from other complexes makes business more challenging in the beginning. Long term, they said, it helps to establish the neighborhood.

Change of plans

The road to development along the light-rail line hasn’t been smooth. Hopes ran high in the 2000s as the city of Charlotte and area officials worked to build the line. Speculators bought up land, sending values skyrocketing. But activity fell just as quickly when the financial crisis hit a few years later.

More than four years after the real estate market crashed, developers have adapted. Gone are plans for luxury condominiums and other projects. New owners have moved in, with plans retooled to meet today’s demand.

Lenders are more likely to finance a new multifamily complex than other types of commercial projects, analysts say.

Veteran real estate appraiser Fitzhugh Stout remembers speculators snapping up raw land in the 2000s as the southbound light-rail line came closer to reality.

At one point, land values in the south corridor doubled in a two-year period, said Stout, who was hired years ago by the city of Charlotte to study property values near the light-rail line.

Stout was among those bidding on property. He said he and others paid $20 a square foot for their office building on West Tremont Street. The value later rose to $40 a square foot.

“What drove that value was the transit-oriented development zoning,” said Stout, managing director of Integra Realty Resources. “It’s all a function of density.”

Higher density lets developers pack more people and uses into a project without having to provide as much parking as in the suburbs, yielding bigger profits.

Plans for the corridor then included mixed-use projects and luxury condominiums, including one where transparent floor-to-ceiling glass walls would fold out of sight to transform an entire condo into a balcony.

But when the real estate markets slowed in 2008, those dreams fizzled. Property values along the light-rail line fell an average of 51 percent, Stout’s research shows.

Values on the rebound

Stout said South End property values are starting to rise, thanks to the apartment complexes. He said some parcels are fetching around $35 a square foot.

“It’s not quite as high as it was, but it’s rebounding,” he said. “When you can build density, you can afford to pay more for the land.”

Apartment complexes, and their renters, in turn draw more development, such as retail and services, experts say.

While apartments account for the most significant new development in South End, about 40 new retail or service-oriented businesses have opened in the area during the past five months, said Ted Boyd, director of Charlotte Center City Partners’ Historic South End.

“Great urban places are built in layers,” said Boyd’s Center City Partners’ colleague Michael Smith. “The South End began very industrial, and there was a lot of re-adaptive use to create a creative district. We’re in the middle of an incredible transformation from a business district to becoming a mix of uses. Housing is going to become an incredible part of it.”

Read more here: http://www.charlotteobserver.com/2012/12/06/3711178/light-rail-attracting-apartment.html#storylink=cpy

[thelakelander]

Great update Vic.  Thanks for sharing.

[vicupstate]

Publix, which is just now building it's first store in NC, will build one right on the Lynx Light Rail line to serve the surging population along that corridor.

Developers plan a 55,000-square-foot Publix Supermarket and additional space for shops and restaurants in South End, a nod to the growing power of the neighborhoods sprouting along the Lynx Blue line.

The project at South Boulevard and Iverson Way, to be called Shops at South Line, will have two levels of sub-surface parking in addition to surface parking, plus 8,500 square feet for other businesses, developers told the Observer on Thursday. Work is expected to start in the spring.

The store will be Publix’s second in Charlotte, and signifies how serious the upscale grocer is about competing head-to-head with Harris Teeter, the Charlotte area’s dominant grocer. The closest Harris Teeter is less than 1.5 miles away on East Boulevard.

Multifamily developers have flocked to the light rail area during the past year, buying up land and announcing thousands of new apartment units.

Developers chose the South End site, the location of the former Lida Manufacturing textile plant, because “it represents a strong and growing demographic,” said Daniel Levine with Levine Properties, which along with Florida-based Stiles, is developing the store. Levine said the South End store will be among Publix’s largest.

The project illustrates a growing trend of how services once traditionally based in the suburbs are migrating closer to uptown.

The grocery store will be across the street from a Lowe’s home improvement store that opened in 2008. Less than three miles away, a Target has a store across from the Metropolitan mixed-use project.

When Florida-based Publix announced its first Charlotte store this year, the grocer said it planned to expand further in the state. More recently, Charlotte-based Levine Properties and Stiles announced they’d formed a joint venture to develop projects locally. Stiles has developed stores for Publix.

“With our partnership with Daniel Levine and Levine Properties, as well as our long-standing relationship with Publix, we look forward to building our second project in North Carolina, as well as additional projects as the grocery giant continues its expansion in the region,” said Robert Breslau, president of real estate investment for Stiles.

The first store, at Providence Road West and Johnston Road in Ballantyne, is expected to open in 2014. The Ballantyne store is expected to anchor a shopping center that includes a Walgreens and a future Fifth Third bank. In October, Publix opened two stores in South Carolina near the N.C. state line.

Supermarket experts said Publix is viewed as a tough competitor, one that has largely succeeded in beating other grocers when they go head to head.

Competition from Publix, experts say, contributed to Food Lion’s recent decision to close all of its Florida stores and to Winn-Dixie’s bankruptcy.

Publix is expected to compete for the same middle and upper-middle class customers as Harris Teeter, making Publix the biggest emerging competitor for the Matthews-based company, experts said. Founded in Charlotte, Harris Teeter has more than 50 stores and 7,000 employees in the region. Harris Teeter wasn’t available for immediate comment.

“North Carolina is the No. 1-requested state for us to enter,” Publix spokeswoman Maria Brous has said.

Publix, founded in Florida in 1930, spent more than six decades growing in its home state. The privately held, employee-owned supermarket chain didn’t open its first store outside the state, in Savannah, Ga., until 1991.

While there are now more than 300 Publix stores outside of Florida, the majority, 752, of the chain’s stores are still located there. The company’s northernmost distribution center is in Lawrenceville, Ga.

Harris Teeter and Publix compete directly in some places, such as Charleston and Nashville. Harris Teeter said it competes successfully with Publix in those markets.

Competition from Publix, as well as Kroger, however, contributed to pushing Harris Teeter out of Atlanta after the Matthews retailer attempted to break into that market in 1993, according to media accounts.

[spuwho]

Is there anyway that a civic entity can start holding public workshops on this kind of development/thinking/planning?

I have seen comments from time to time about people not knowing about $100million here, or plans over there, etc.

Let's find a way to educate the public in advance of any major "plans" or "vision" for mass transit, so people can relate to the goals.

Just a thought.

[thelakelander]

There were a series of well attended public events that shaped the commuter rail, streetcar, etc. plans currently proposed between 2005 and 2010.  For those interested in downtown, the DIA will have to create a new CRA plan (basically a downtown master plan) in 2013, so there will be an opportunity for public input and planning.  In addition, we have Jax2025's community visioning event on January 19, 2013 at the Prime Osborn Convention Center from 9am-11am.  This will be a great opportunity to provide input on mass transit, education, economics, and anything else you believe is important to the future of Jacksonville.

[tufsu1]

and don't forget Lake...the 2040 LRTP update process will be getting underway soon....so there will be additional public involvement opportunities in 2013 and 2014 for that plan.

[fieldafm]

Is there anyway that a civic entity can start holding public workshops on this kind of development/thinking/planning?

I have seen comments from time to time about people not knowing about $100million here, or plans over there, etc.

Let's find a way to educate the public in advance of any major "plans" or "vision" for mass transit, so people can relate to the goals.

Just a thought.

The public meetings in which the DIA updates their CRA plans (the current CRA plan from the early 80's mentions prominently a future 'people mover' and feeder park n ride lots/garages as part of downtown's future development plans/patterns) is BY FAR your best opportunity in the short term.  The new CRA should adopt the Mobility Plan's priority legacy transportation projects which connects In Town Neighborhoods with Downtown. 

[fsujax]

Nice fight brewing between the Governor of NC and the current Mayor of Charlotte over funding a streetcar.

http://www.charlotteobserver.com/2013/02/01/3825774/city-mccrory-threatens-light-rail.html

[thelakelander]

Interesting fight going on there.  Kind of reads like the Governor is using his influence to try and kill a project he didn't like when he was the mayor of Charlotte.  I'm a risk taker.  I'd call him on his bluff and move forward with whatever my city had planned.

[vicupstate]

An excavator crashed its claw into the lone brown-brick building on the corner of West Boulevard and Camden Road on Tuesday, beginning the final demolition on the property before construction begins on a new residential and retail complex in August.

Nearly 50 people were on hand to celebrate the demolition and soak in the continued revitalization in the South End neighborhood.

Camden Gallery, as the complex will be called, will feature 323 apartments and 8,600 square feet of retail space when it's complete in the first quarter of 2015, said Holly Casper, district manager for Camden Property Trust, the development company in charge of the project.

Sandy May, who works in the UPS store across the street from the razing, said the event is symbolic of the neighborhood's recent growth from a warehousing district to an urban residential hotspot.

"Prior to the renaissance, for lack of a better word, there were no destinations over here, said May, who has lived in the neighborhood for 11 years. Now with this, we're giving people a reason to come."

Camden Gallery is one of five multi-family development projects that total 1,231 units that are currently planned for the neighborhood, said Ted Boyd, director of Historic South End.

Since 2012, eight additional projects with 1,845 units have been completed or are currently under construction in the area, he said, amounting to nearly $300 million worth of construction.

Currently, about 3,200 people live in South End, Boyd said. He envisions the population doubling by 2015, with most of the new residents being in the 25 to 45 age range.
Much of the development has been around Charlotteââ,¬â,,¢s Lynx Blue Line in South End.

Of the more than 4,000 apartment units announced in the city last year, 65 percent were around within a 15-minute walk from the line, according to CoStar, a real estate analytics firm.

Eric Zaverl, 33, stopped by on Tuesday to watch the yellow excavator tear through the wood, brick and glass of the house.

He's lived in the Post South End apartments for more than two years, he said, and wants to move to another apartment complex in the neighborhood with his wife.

He said his rent has increased every time he renews his lease, and available housing is becoming more scarce. He's hoping the increased supply of apartments such as Camden Gallery will drive down the price, he said.

it'ss good to see land that wasn't being used before go toward something,ââ,¬Â he said of the demolition.

Nearly 3,100 apartment units in 2 years, all  within a short walk of LRT.  In a city still reeling from high unemployment.

Didn't I read that the next Chamber trip was to Charotte?

[tufsu1]

not sure where the next big trip is....but there is a Chamber downtown visit to Charleston in early September

[fsquid]

south end was little more than industrial buildings and antique shops when I was in college there.

[ProjectMaximus]

Didn't I read that the next Chamber trip was to Charotte?

http://www.myjaxchamber.com/index.php?src=events&category=Featured&srctype=detail&category=Featured&refno=190

not sure where the next big trip is....but there is a Chamber downtown visit to Charleston in early September

http://www.myjaxchamber.com/index.php?src=events&srctype=detail&refno=204&category=Chamber

[tufsu1]

correct PM...I got an email late last night regarding the trip to Charlotte

[Captain Zissou]

How fruitful are these chamber trips? There's usually some glad handing and attaboys thrown around hen everyone gets back, but I can't really see much that has come from them.