Monday, November 29, 2004

Riverfront Projects Spark More Downtown Interest

Memphis Daily News [link]
by Andy Meek

Developer Kevin Hynemans recent purchase of 8.7 acres of Mud Island property is further proof, if any was needed, that the 1-square-mile strip of land is still a strong magnet for new residential development. And besides Hynemans new Mud Island project, other nearby developments are using their proximity to the Mississippi River to spark continued interest in the area.

More new homes. Hyneman bought the property from the Riverfront Development Corp., which oversees the use of public space on Mud Island, and his plans call for 106 single-family, detached homes priced between $160,000 and $250,000. He plans to break ground on the homes after Christmas, with the first homes available for sale around summer 2005.

Hyneman said there is already a waiting list for the homes, echoing a previous project he developed on Mud Island that saw 80 homes sold in one day. A reservation list had been drawn up, and buyers camped out on the island to be able to pick the lots they wanted, he said.

Fueling more growth. Hyneman, who has developed several projects on Mud Island, believes strong demand is both a result of and further fuel for the general resurgence of Downtown.

Downtowns on fire, he said. I think its supply and demand for Mud Island people see theres a sense of urgency because theres no other property on the island to buy.

Benny Lendermon, president of the RDC, said the group has plans for a walking trail along Wolf River Harbor, a project related to Hynemans recent purchase.

The group also is moving forward with plans for the Beale Street Landing project, which Lendermon said will be a public gathering place and the signature development at the foot of Beale Street. He estimates ground will be broken in the spring and initial construction will begin soon after along the rivers edge.

Well be very, very disappointed if it doesnt, he said.

The $27 million project at the foot of Beale Street will likely include a plaza, a terminal building, a small restaurant and a series of small parks perched at the rivers edge. The RDC also is continuing with some minor park improvements.

Healthy residential market. On Mud Island, where several residential communities in addition to Hynemans are under way, healthy residential growth is visible.

Several residential communities have taken root north of Harbor Town, Mud Islands first residential community. And according to a recent Downtown market study commissioned by the Center City Commission, the current population of Mud Island part of the high growth area in Downtowns Central Business Improvement District is estimated at 4,262.

Hynemans latest project is part of an overall plan for 186 new homes on the island. Hyneman expects to sell most of them between now and the end of 2005.

Weve built over 500 houses down there, and this is just another phase of what weve been building down there for the past five or six years, he said. Weve got another 80 lots that are currently being developed, and those will be released sometime in the next couple of months.

Property history. The property was originally part of an effort by the RDC to acquire public land along the river. Lendermon said the land Hyneman bought was property the city had acquired from an asphalt plant after it moved. The city transferred the land to the RDC this year to help the group acquire public land and better access to the river.

Originally, we were going to use it as part of an equity transaction in that development to the south of Mud Island, and we were going to actually utilize this piece of property to help facilitate the transfer of other properties to allow parkland to be acquired along the waters edge, Lendermon said. So we were retaining this piece of property for the city, and then at some point that wasnt going forward. We had it, we had no use for it, but we still wanted to use it for something to our benefit. Kevin owned all the properties surrounding this piece of property, and it was sort of landlocked. He also owned a whole lot of the water frontage along the harbor we were interested in acquiring.

Advantages. Hyneman, who bought the 8.7 acres from the RDC for $841,000, also agreed to transfer 18 acres of waterfront property he owned along the Wolf River Harbor to the RDC, which will use the land for part of a walking trail. Lendermon said the city supported the sale of the 8.7 acres for several reasons.

The tax benefits from those single-family homes are somewhat significant, and it allows the whole chunk of property to develop and put property on the tax rolls in a way that both us and the city felt was appropriate, he said. So it appeared to be a win-win for everybody.

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