Behind the Headlines — November 13, 2015

Behind the Headlines — November 13, 2015


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Production funding for
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A2H: Engineers, architects, and planners creating an
enhanced quality of life for their clients and our community. More about A2H’s services and
markets is at A2H.com – Tonight on Behind the
Headlines a possible redevelopment
of Mud Island could join a growing
list of more than three billion dollars in
investments in Memphis. [theme music] I’m Eric Barnes,
publisher of the Memphis Daily News. Thanks for joining us. I’m joined
tonight by Andy Cates, CEO of RVC Outdoors. Thanks for being here. – Thanks for having me. (Eric)
And Bill Dries,
senior reporter with the Memphis Daily News. So, we wanted to have you
on the show because a week, week and a half ago you did a
presentation of a commercial real estate group on all
this investment in Memphis. Lifestyle investment. So, residential. Skipping over manufacturing
and commercial and so on. Bass Pro. Entertainment things, offices. A total of about
2.5 billion dollars. Since you did that
presentation, you know, St. Jude announced another. Didn’t include St. Jude. There’s another billion
to billion and a half, depending on how you count it. But also what happened, and we
want to start here is the city has released an RFQ for
redevelopment of Mud Island. You have already on the
record expressed interest in redeveloping Mud Island. What are your plans or why
do you want to pursue it? What do you have in mind? – First of all, our company,
RVC Outdoor Destinations, which focuses on high
quality recreation. Since we office in the Pinch,
gotten to see so much good things happen Downtown. It was a natural to say: Is
Mud Island an opportunity there? But then as a Memphian, always
being fascinated by Mud Island and realizing this is an
incredibly underutilized asset that is also in deep
need of revitalization and redevelopment. Our general plan.. By the way, RDC, the
Riverfront Development Corp. The city owns the land
and owns Mud Island. Mud Island was built — opened
in ’82 and has about a ten million dollar
operating loss a year. (Eric)
The city of Memphis,
the city tax payers. (Andy)
The city effectively funds. So, a lot of what we’ve
done is first of all, try to understand the
history of Mud Island, which is fascinating in itself. The importance of Mud Island and
what does the community really need and want from Mud Island. And then what are the
opportunities from Mud Island? And we would love to be
a part of this solution. If alternatively by being the
pests that we are and agitating it just builds enough energy
that there’s a better answer or someone else has a better idea
or wants to put in more money, then we’re going to
eventually propose, that’s great for the city. But our general thesis would
simply be it’s time that we fix Mud Island. – And a couple.. As a community. RVC Outdoors does
destinations for.. The RV in RVC is RVs. – We’re in multiple states. But I do want to be clear. RVC does cottages. We provide multiple lodging
options at extraordinarily high quality recreational
destinations for vacation. Baby Boomers, families,
think of it as an outdoor hotel. We’re in multiple states and
we’re proud of the work we’re doing. It’s a lot of fun
and go to our website. But the answer would be
no RVs at Mud Island. We would clarify very
quickly that RVs is not a part, won’t be a part and need not
be a part of our proposal. – So, some viewers of the show
will know that you and I are friends. We’ve been friends
for a long time. And so, I wanted to get a
picture of an old Winnebago and Photoshop it on to Mud
Island and put that up for you. – That would
obviously have led to.. – Just kill all of your plans. More seriously,
you’re looking at.. Do you know at this point what
kind of private investment and what kind of public
investment you’d be looking at? – We don’t. But I do.. Our biggest.. (Eric)
It’s in the tens of
millions of dollars though, right? I mean, the place has not been
taken care of well for quite a while. – Yeah, we’re not
picking on anyone. But there has not been
significant capital investment in Mud Island for
ten years if any. There’s.. And the folks that are working
on it are trying hard and doing their best with extraordinarily
limited resources for starters. So, so much of this is the
fact that it’s just been wildly undercapitalized. Yes, we’re talking
about the tens of millions. We’re inevitably.. Our proposal, which is very much
not final yet and we’re still doing a lot of our homework. Inevitably we are
going to recommend, respectfully, that there be a
model similar to the Memphis Zoo or Shelby Farms or Overton Park,
which the conservancy used to sit on the board I believe, that
you have a public or a nonprofit entity that consists of
community leaders that oversees the future of that
important asset. We would then, as RVC, have
a contract that we negotiate directly with the city of
Memphis to develop — radically redevelop and operate it. And then that
conservancy would oversee it. I do think there’d be both
non-profit charitable dollars coming in to improve it along
with direct for profit dollars to try to bring activities like
water park or like lodging to the island. – And again, just so
people aren’t confused. I mean, are you talking about
making it a for fee amusement park, getting rid of the museum,
getting rid of the amphitheater? I mean, can you give some sense
of what sort of transformation there would be? – Yes and I want to.. I’m not trying to
weaken anything. But I do want to be clear. It’s early. And we are serious when we
say it needs to be a community vision. So, I can tell you some of the
things that may be easier to tell you what we see as
nonstarters or more importantly more positively
that are requirements. The Riverwalk, the
model of the river, needs to be restored. It needs to be lifted up. And I think it’s
untouchable in my opinion. I think that you start there. The amphitheater I
would put up there, as well. Where the
amphitheater needs to be.. Frankly, both of them
desperately need to be fixed. They need to be improved. And they need to be
brought into this century. The rest of the existing
infrastructure I think frankly needs to be discussed. And I will say that the
museum has actually got some extraordinarily interesting
components and some great collection. I mean, has a great collection. So, I want to be clear. We don’t know the
history of that. I don’t think the city or
RDC knows the history of that. But it, at a
minimum, needs desperately. And anyone involved
will tell you this. It desperately
needs, at a minimum, it needs a major renovation. – Let’s get Bill in here. – So, does the
general concept then.. Where is there
room to add to that, to do the kind of outdoor
experience that you do? – There is, Bill, on
the tip of the island, you’ve got.. Effectively go.. Coming South to North. So, if you’re at the flag poles
looking at what is Beale Street Landing across
Wolf River Harbor, there is actually a
significant amount of landmass, which by the way has flooded. And there’s more acreage. There’s more acreage than a lot
of people realize in the river park. And I’m going to say
Mud Island River Park. When we refer to Mud Island, so
many people think of Harbor Town as part of it. Everything I’m talking about is
literally Mud Island the River Park. Which on a side note, we think
that needs to be revisited as a name. If you’re not from Memphis and
you hear that you’re going to go to Mud Island, that just
needs to be revisited. We ought to think about that. So, I think there is
room for water features. I think anything that goes there
has to be architecturally and artistically thought out deeply. We’re not proposing that
you just go throw up.. I’m very, very scared of
the term “theme park”. I think most people are. I think if it’s not
authentic, if it’s not Memphis, if it is not real and attractive
to a very broad range of folks starting with
Memphians, it won’t work. As an example, rather than go
restaurant that’s a permanent restaurant, we’d rather
focus on food trucks. Rather than have
Budweiser do something there, it’d be insane not
to go to Ghost River, or Memphis Made, or Wiseacre. So, for starters, we believe
less is more and that you’re not going and focusing on. Although you must have an
extraordinary vision and you’ve got to look at this whole thing
as a massive redevelopment. We’re not
proposing that you go to: Hey, let’s try to put a 400
room hotel there tomorrow. Well, first of all, I wouldn’t
recommend that right now. And secondly, if you do
that and you’re wrong, you’ve got a problem. And if you do
what we inevitably.. You’re going to see that
we’ll inevitably propose.. We are proposing steps
that are very attractive, that are well done, that
will be designed well. But frankly, if we’re
wrong, they’re not going to be permanently problematic. – Greenbelt Park, which is
beyond the park borders at this point, has been a great success. A lot of people go there. It’s a very different Riverside
view than Tom Lee park. There’s been some talk about
perhaps extending that Greenbelt Park into the Riverpark itself. What about that? – It absolutely needs to be
a part of what we consider. I think it’s a
logical conversation. And I think anything we do,
we would lean toward extending public space into what is
currently quote the Riverpark. There is a ton of
design issues around that. As an example, the
river terrace building.. You’ll remember River Terrace in
one of the main buildings as you approach through the parking
lot the existing Riverpark. It cuts off,
physically cuts off, the ability to walk ro drive
further south as you’re going north to south. That needs to be revisited. In other words, if you
extend Greenbelt Park, there are physically a number of
issues you’re going to have to resolve. I think you need
to address them. In other words, it has
absolutely got to be a part of the conversation. I will add for us one of the
challenges and for anyone who looks at this is if you do
have all of this public space extension and expansion, which
again we believe is going to need to be a part of
the vision by the way, it does bring up some
operational struggles. Because as an
example, if you have a.. You were asking,
Eric, if there’s a paid.. Again, I don’t want
to say theme park. But if you had a waterpark
that required admission, how are you going
to separate that? Or even more specifically, if
you have cottages that we build or you have a river tent that’s
furnished that you want to allow someone to rent overnight,
you’re going to have to find a way to protect those areas and
control access in those areas. And that’s not easy. So, these are not.. This is not
something you can do. – If you look, and then we’ll
move on to some other things. But you look. I mean, the zoo. I mean, within the broader.. The zoo is a paid area of
the broader Overton Park area. The Greensward is and
the whole forest are free. It costs a lot of money. Again, you mentioned
I’m on the board of that. But clearly those kind
of things have worked. – And by the way, to your
point of that as an example, you also welcome it. Because you desperately
want Overton Park to be this extraordinarily active
amenity for the city of Memphis. But guess what. That’s good for
the zoo, as well, because it is inevitable
that as folks use Overton Park, hey, I want to go to the zoo. – So, to segue into the
presentation you gave and I think the full
presentation is on our website, on Memphis Daily News. But that kind of, the fit. Part of what you present, and
you went through a whole host of projects, some of which
we’ve done on the show. Crosstown, Bass
Pro, Central Station. We talked about the
medical district. Huge amount of investment there. And part of what you, again, you
focused really on what you call lifestyle. Forget the manufacturing and
distribution where there’s billions of dollars in
investment going on. But on that kind of
lifestyle, how we live, and so on. And it seemed like part of
your presentation was that these things are
feeding off each other. And that people maybe
aren’t seeing that. Because you are presenting a
bunch of commercial real estate people, people
involved in the projects, some familiar names,
Henry Turley and so on. But even you said afterward that
people came up to you and said: I hadn’t really thought
about how big it was. I hadn’t thought about how many
different projects were going on in total. You said, also.. I don’t want to put
words in your mouth. But you said also that we’ll
look back five years from now and see this as a
transformative moment. Why? – Well, for starters,
Lambda Alpha was the group. And it’s a great group of
real estate decision makers, owners. And it started with a lunch. I was at a Lambda Alpha lunch. Someone was, frankly,
was whining about.. I won’t say a name. About Nashville. And I’m jealous of Nashville’s
growth but I don’t want to live in Nashville. And I’ll take
Memphis over Nashville. And so, I thought, you know,
it’s interesting is I asked this person especially about
Midtown and Downtown projects. This person tended to
— just wasn’t as aware. It occurred to me that he didn’t
understand frankly everything that’s going on. So, we decided — we
proposed that there be a, frankly, an update on
all the Memphis projects. So, I very self-righteously was
ready to tell the world about all the great things I knew
about and how to tell them to appreciate it. And then as we
put this together, it exploded. And then we learned about a
billion and a half dollars of projects we had no idea about. And so, it’s extraordinarily
exciting to us because I would have told you before, we were
educated on everything that was out there. And by the way, we left some
things out we can talk about. Since giving this, we’ve.. I realized a couple of
things I forgot about, plus some we learned. It is absolutely,
in our opinion, we’re going to look back at this
time in Memphis history and say this was a dramatic
transformative moment in Memphis’ history. And again, a lot of this
you’re going to see physically. You’re going to feel it next
year when a number of these things open. I mean, Harahan Bridge to Shelby
Farms alone from this greenscape going on in Memphis. That alone is something that
we’re all going to be able to utilize on the ground next year. And then as far as.. I’m glad you mentioned. We did not include
in that 2.4 billion.. We really didn’t include
purposefully any additional warehouses. And I’m not demeaning those. It’s an important
part of our economy. But all of this is lifestyle,
they affect our quality of life. And in the medical,
University of Tennessee, University of Memphis, St. Jude. We have to have daily greater
appreciation for those entities. And then finally,
I would point out, I did start with FedEx. We need to
constantly bleed purple. They’re so
critical to this city. But those.. Everything we just
discussed in this presentation. Most importantly, it was about
appreciating what we’ve got. – I’m going to drill in on a few
of the things you talked about. One is that UT Health
Sciences, the medical school. Part of what you’re
talking about is they talk about dollars. And we’ve covered these
things independently. We’re guilty of
that at the paper. But they’re talking about
a direct impact of 400 new projects under consideration,
$290 million over the next few years. But then they talk about a
multiplier effect of 329 million. And then you’re talking about
$600 million of impact in that medical district. – But I want to be clear. You just said.. Since you’re my friend,
I can make fun of you. Under consideration. I want to be very clear these
are all projects that are funded and either being
developed or they are.. I mean, they are done. They are either happening,
have already opened recently or they’re about to open. So, it is. But I say that purposefully
because a lot of times you see these kinds of presentations and
it’s all these brilliant ideas. But you really don’t know
if it’s going to happen. And we did finish the
presentation with some things that are on the radar. – Right. The 2.4 didn’t
include One Beale, which is.. – It didn’t include St. Jude at
the time because Rick wouldn’t let me say anything. But it is doubly remarkable. And by the way, you’ll see in
the slide deck we certainly took the opportunity to push
for Mud Island discussion. Mud Island will be.. Someone’s going to fix Mud
Island whether it’s us or somebody else. That’s going to be
millions of dollars. So, there is a lot even on
the radar that we didn’t even discuss. So, anyway, you
were talking about UT. That also plays into Methodist. And we were careful we weren’t
double counting because as we did the analysis, we were
looking at such huge numbers that we had to be very clear
that we weren’t double counting Methodist and UT
Health Sciences, especially since they
have some direct overlap. You put those two together,
that’s a half a billion dollars just in the last
24 month period. Those are major, major shifts. – What’s driving this? And is some of what’s driving
this the momentum from different projects that you outlined? – I think a number of
things are driving it. Part of it I would tell ya is
this underlying framework that we.. I’m going to say I. I take for granted. And so part of this
was to stop and say, you know what, UT
Health Science Center, University of
Memphis, Methodist Hospital. Some of these institutions
have been doing great things and growing. And we have.. I would at least say from the
business and commercial real estate community probably
aren’t as aware as we should be. That’s part of it. Another part of it though
certainly has jumped up. And I’d say a lot of that is a
lot of good folks focused on a lot of these. And we said, as y’all remember
form being at the presentation, a lot of what I want to do
is also identify all these extraordinary people that
are leaving these projects. I’d say we have a lot of great
leadership out there on each of these, especially that are hyper
focused on making these things happen. I would ask you, Bill. I don’t know. And then if you said: Well, is
there something going on in the economy or something
specifically that it sparked all this. I don’t know how to answer it. But I will tell you I do
think it is an outlier. I don’t think it’s common
that you’ve got $2.4 billion of quality of life improvements. And we did come up with
about another 2.5 billion of commercial and distribution. – Let’s talk about
grocery stores for a second. We’ve talked about it. You didn’t put in there. Kroger is doing 40 billion.. I don’t want to give Kroger
an ad but they’re investing. Whole Foods is investing. There’s some sort of plan. We don’t know who but in Midtown
in a vacant building at Union and McLean. – Literally that night
after giving the presentation, we realized grocery is a
huge part of quality of life. And starting with, I would start
with the Whole Foods on Poplar, that is a big deal. And Whole Foods is a
great asset to a community. Then that led to.. I think a lot of
this is competition. That led to, frankly, I think
Kroger realizing they’ve got to up their game,
certainly on Union. I’ve been told. I know this for a fact. But I’m pretty confident that
that’s going to be the most expensive Kroger in the
Southeastern US by the time they’re done. I think it’ll be a great store. And then yes, there’s this
Union and McLean project. (Eric) We just had
up a picture of that. – It’s a neat project. I did not put it
on future projects. I think it’s high
likelihood though. I mean, I think the Belz and the
group out of Atlanta is probably going to do that. – How much of this.. You talked about some of
the great people leading. Your family has been.. Your brother Staley, your
mom and your dad have been tremendously philanthropically
involved in all kinds of projects. Your dad.. – Slap us on the back. – But there are a lot of
folks like that in Memphis. The Hyde Foundation. I mean, you gave
a shout at them. And it’s really
pretty remarkable, the philanthropic. – FedEx alone has
been incredible. – And FedEx, too. I’m not giving enough. The Plough Foundation,
there are a ton of them. One interesting thing is.. And I remember when Billy Orgel,
who made a whole lot of money, was very involved in
the school consolidation. When he stepped forward and is
doing the redevelopment of the Tennessee Brewery, the
quote we had was that, you know, if you just
want to make money, you can go build a
strip center somewhere. The Wilson family
getting involved in Crosstown, which your brother owns that
and kind of is involved with. The Wilson family has made
a lot of money building, you know, — there’s nothing
wrong with it — hotels all over the country. But turned back in
and makes money. It’s so interesting
because it makes money. You don’t want to lose
money on Mud Island. But you could probably go make
a lot more money somewhere else than spending
time on Mud Island. – I would start with Henry
Turley is one of the most talented real estate minds
you’re ever going to run into. And he’s passionate about
recreating or basically building a new Downtown, which he’s done
over decades and still does. So, yeah, I would
argue that yes, Memphis has an extraordinary
socially entrepreneurial spirit. And you see that with Scott
Morris of Church Health Center. You see that both in the
non-profit side and in the for profit side. And by the way, if you
really want to go to that level, Fred Smith could move FedEx and
make a couple more dollars maybe in another city. But he’s committed to Memphis. Thank God. Literally. And so, I don’t.. But yes, Memphis, we’re very
fortunate to have a incredible group of leaders, many of whom
— not all — but many of whom were at that lunch. And the other
thing Bill was asking, you know, what’s triggered this. So much of this,
frankly, was just putting, which was fun too. I joked at the beginning of the
deal that we were going to give a Donald Trump hat since we’re
going to take credit for all these projects
other people are doing. So much of this is just great
people doing things quietly and below the radar. So, a lot of this, frankly,
was just shining a light on this wonderful stuff where
people aren’t self-promoting. Their heads are down. They’re focused. And I think what was really
rewarding for bringing this up and why this is. I think it has hit a
nerve, a positive nerve, is that people are so
encouraged by the fact, hey, I’m in my world focused on
my project or doing this whether it’s a business or non-profit. And it’s really rewarding to
know that so many of these other great things are going on that I
just don’t have time to monitor frankly. – And you coupled this with
a call for people to defend Memphis as well because while
we’re largely unaware of this combination and this synergy,
you think it’s important that we realize that there
are good things going on. – And another great
Memphian and a Memphis promotor, Larry Jensen, was there too. He’s always been a big
— very good about that. He and I were joking, both of
whom have Texas experience. He was pointing out rightfully
if you go to Texas and criticize Texas, you’re
going to get punched. We don’t do that
enough in Memphis. I’m extremely proud of Memphis. I think Memphis is a great city. We travel and spend a lot of
time and business in a lot of other cities. I want to come back here. I don’t want to stay there. We are.. Thankfully that is dissipating. I mean, a lot of that. Even having the conversation
about people being negative is wasted energy in a way. But most importantly, we do need
to be better about defending this city, promoting this city
proudly and in a thankfully and authentic way. These are real
things happening here. – And in recent years, we’re
painting murals on walls with big hearts that
say I love Memphis. There’s a whole social media
component to this that seems to be generational in some ways. – I think it is. You look at John Carroll
and Choose901 as an example. They’re on fire. I mean, that has been another
one of these I’d say branding. It’s more than that. But their branding idea
has absolutely taken off. And so, but I agree with
you on the generational side. One of the things we pointed
out was whether it be David Montague’s Memphis Teacher
Residency or Teach for America. There is a very significant
population of purpose driven, mission driven young people that
are bright as hell and talented as hell. And they are coming here saying:
I can serve and I can have this incredible quality of life. So, I can have
meaning in my life. I can also have a place in a
community that I like with people that I like. Memphis does have
that hospitality, this extraordinary DNA. – Alright. That is all the time we have. I’m not just interrupting
you because you’re my friend. We got through this whole thing
without laughing and that was pretty good. – It is good. I’m proud of you, Eric. – For the full
presentation, go to our website. Thank you, Bill. Thank you for joining us. Join us again next week. (male narrator)
A2H: Engineers, architects, and planners creating an
enhanced quality of life for their clients and our community. More about A2H’s services
and markets is at A2H.com

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