Behind the Headlines – October 26, 2017

Behind the Headlines – October 26, 2017


– (female announcer)
Production funding for Behind The Headlines is made possible in part by the WKNO production fund,
the WKNO endowment fund, and by viewers like you. Thank you. – Investments in the
Riverfront, convention center, and more tonight on
Behind The Headlines. [intense instrumental music] I’m Eric Barnes, publisher
of The Memphis Daily News, thanks for joining us. I’m joined tonight
by Jennifer Oswalt, the interim President and CEO of Downtown Memphis Commission,
thanks for being here. Along with Kevin Kane, CEO of The Memphis Convention
and Visitor’s Bureau, thanks for being with us Kevin. – Pleasure. – Along with Bill Dries, Senior Reporter for
The Memphis Daily News. So we’re gonna talk
tonight a lot about the things that are sort of
true to, right in your heart and the things that
you guys work with in terms of the convention
center announcement a week and a half ago
about the Riverfront, the Pinch district and so on
but a bigger question to start, and I’ll start with you Kevin, why is this focus on downtown,
on downtown investment, all the time, the
money, the effort, why downtown and to a
lesser extent, why Midtown, ’cause we’ll talk
a little bit about some of the things that
are going on there. – Well first of all, great cities are built
on great downtowns. Every community large or
small has wonderful suburbs and we certainly have
wonderful suburbs and we have
wonderful communities around Shelby County. Great destinations are
built on great downtowns, and we are building
a great downtown I think if you
look at the assets and the pieces that
have been put in place over the last 20 years
it’s been transformational and downtown is a place where
people work, live, and play, and it really becomes
everybody’s shared neighborhood. I think I’m stealing
your lines here Jennifer but it really is true and obviously from a tourism
standpoint it’s a fact that most of our visitors end
up in downtown Memphis, whether they’re coming to
visit Elvis Presley’s Graceland or they’re going to
the casinos in Tunica, they end up in downtown Memphis on a visit to the Mid-South area so millions of people
go to Beale Street, millions of people
go to the river. So I think it’s very key that
we have focused on downtown and we’re finally fleshing
out our Riverfront. – And for you Jennifer the
Downtown Memphis Commission, formerly known as
Center City Commission, the investments that you
all make or that you support are not just the
investment from tourism, a lot of people do
think of downtown as being a tourist destination but you’re also working
with small businesses, you’re working to get
people to live there, all the kind of things
that Kevin talked about, why is that important, why does the Downtown
Memphis Commission exist for those issues? – Well and that’s what’s
making it more exciting for us is it’s being attracted by both
ends, tourism and residence so we have over
1,200 new employees moving into downtown
in the next year, we have over 2,000 new
apartments coming online and over the next
three or five years we expect near 5,000
between downtown and the medical district which is part of downtown
just outside the core. So it’s key that you have daytime and nighttime
activities so we don’t, we want it to be
vibrant all the time so when the tourists
are at Graceland we still want it
busy during the day with workers and
people that live there and for sure millennials but we see every age
range moving downtown. Retired folks, people in
the heart of their career, and millennials so we’re
excited about that. – Alright, Bill. – So we’re still
kind of figuring out how the Riverfront plan
is going to take shape now that we’ve had
the announcement that Brooks is looking at moving
into the block on Front between Union and Monroe
and those talks are ongoing, the Riverfront plan as a whole and that piece as well
involves a lot of money. Some of it is sales tax
revenue captured in the TDZ, but walk me through
how we raise this money because it comes from a
number of different pots, a number of different sources. – Who wants, you
want to try that? – I think that the best
thing about the plan is that it can be
compartmentalized and it’s not in the full
control of any one person so it doesn’t have
to all be done by the city or a
private developer. And there’s interest from all different ends
of the spectrum as well and so all that money
doesn’t have to come from our philanthropic
community, it can come from businesses who intend to make
a profit on some aspect of it as well as city and other
government entities. We stand ready to offer any
incentives that we’re able to, they don’t all make a good
fit, but where we can. – Will there, as
part of the oversight of the Riverfront development
and how it goes forward, will there be an
enhanced fundraising? – Oh I don’t think there’s
any question about that and I think that’s the beauty of some of the successful
projects we’ve seen throughout the community
over the last few years, it is a combination of
public private partnerships. The beauty of the Riverfront
and the beauty of the TDZ is that we’re not taxing
the local citizens, we’re not hitting
the general fund that makes obviously
so many Memphians and residents of Shelby
County very nervous, I mean this is this wonderful
vehicle called the Tourism Development Zone has been just a
real godsend for us it basically financed all of
the Bass Pro improvements, it’s done a number of other
things within this community obviously looking
at the fairgrounds you’ve talked about
that on the show is one of these
other opportunities, it completely transformed
Elvis Presley’s Graceland with a new hotel and a whole new revamped
entertainment complex out there so and it’s gonna do the same
thing along our Riverfront and our convention center
which by the way is a very, very important piece
of economic development for this community. – And you have some relatively
recent TDZ revenue estimates because at the outset of saying we’re gonna renovate
the convention center, we’re gonna put a new skin on it was what everybody talked about, the ballpark figure
then had been something like $60 million. That’s not the case? – We’re well beyond $60 million and what happened fortunately
is the administration, the city administration
was doing a deep dive in the long term projections for the tourism
development zone along with the city hotel
motel lodging taxes. They realized that there
was more capacity there than they realized, you know that they’d ever
anticipated to begin with. As a result of that
we’re gonna go from a paint up, fix up, spruce
up of a 43-year-old building to totally to really
a total transformation of what the convention center is and I will tell you that
come September of 2019 if I blindfolded people who
were familiar with the building and put them in our
main exhibit hall or in our downstairs lobby or in what we call
the South hall now or different aspects
of the building and I took the
blindfold off of you you would not know you were in the Memphis Cook
Convention Center, that’s how transformative
it’s gonna be. It’s gonna have
all the amenities of what you would expect in a 21st century
convention facility. Hotel quality, lots of
break out meeting space, lots of casual areas for
people to informally meet, that’s the world that
we live in today. And lots of connection
to the outdoors, there’s gonna be
for the first time beautiful outdoor vistas
of the bridge, of Bass Pro, of the Riverfront, and the
mighty Mississippi River. We didn’t have
that prior to this so it’s really gonna
be a destination. – So is it an expansion of
the overall square footage, not dramatically. – It’s not a major, there
will be an expansion, there will be a minor
expansion of square footage. – So people should not expect,
people have been to Nashville and seen that huge kind
of convention center, this is not that kind of thing in terms of the size
and scale of it. – It’s still the biggest
building in Shelby County. – Yeah right, and
you’ve argued before whether that was a good
idea to even think that way, that’s not the direction
that people are… – Quite honestly you have
to have the hotel capacity if we were gonna triple the
size of our convention center, number one you better
have the airlift, number two, you better
have hotel capacity. We’re still trying to
right size all those things so I think for where Memphis is and where Memphis
is going to grow over the next 10, 15, 20 years, and we’re anticipating growth, we’re not anticipating
standing still, I think what we’re doing with our convention
center is spectacular and I will say this to build
a brand new convention center the size of what we have today would probably cost north
of $500, $600 million. Obviously we don’t have
that kind of capacity within the TDZ or the
bed tax to do that but we are gonna do something obviously more than $100 million and it’s gonna be
something that’s gonna be, something that’s gonna
serve our community well for generations to come. – And before I go
back to Jennifer, the proposal that
the Mayor’s office, the Riverfront task force, whatever the collection of
people put forward for the TDZ, what, about 10 days ago now, was about a
$550 million proposal, it’s a very conceptual budget that’s the way it
works with the TDZ but it’s most of that
is either the TDZ money which is money that would
otherwise go to Nashville as you said and stay there
but instead comes back. A certain amount of
philanthropic money, they’re hoping quite a bit,
upwards of $200 million, but it’s not based on,
when you talk about these big projects and we’ll
look at some of the pictures and some of the concepts of
where an aquarium would go, a freshwater education center, all kinds of transformation
out on Mud Island making Mud Island open to
the public, all those things, the bulk of it would not
be me as a city resident paying more in property taxes. – That’s right and I think it’s
important to point out that especially for our
viewers, this is money that if someone watching would
say, “Well you know what, why don’t we build a new jail?” or, “Why don’t we
build more parks?” or, “Why don’t we improve
our roads or our schools?” This money is restricted. This TDZ money, you have
to be a qualified use, that’s the way the
state set this up, these were basically the
opportunity to take resources by economic development issues and create enhanced taxes for
everyone, the state, local, everybody in between
so in the same with the hotel motel bed tax so it’s not like people are saying well they’re wasting money on aquariums or museums or
tourism amenities, no, these are monies that otherwise
would go back to Nashville but they have a
very qualified use and unfortunately you can only
use it for things like this. – Right and Jennifer you
were gonna say something. – I was just gonna say that the plans for the
convention center are attracting interest
by hotel developers and so along with the city we’re vetting a lot of that
interest and in addition to all the improvements at
the convention center, these hoteliers are planning
a lot more meeting space, you know, more than a
normal hotel would have so we think that it has
drawn a lot of interest from that market. – And another part,
before I go to Bill, another part of this
is the Pinch district and the Pinch district which was a very vibrant
place back in the day has been dead since
the pyramid was, the FedEx Forum was built,
other factors that came into it, so St. Jude announces
a major expansion and they’re the biggest
probably, if not the biggest, one of the biggest property
owners in the Pinch district, and we have some renderings
that show some ideas, this is not the
exact vision of it, of a combination
of St. Jude uses and other private
developers coming in. Your thoughts on
that and the DMC role in terms of what’s going
on in the Pinch district. – Sure just to start off with one of our entities at the
CCDC has funded an art project, an underpass that connects
the convention center to the Pinch so
that’s the first step is creating that connectivity and then we are talking
with lots of people about different projects
that’ll happen pretty quickly in the Pinch. – (Eric)
From big to small. – From big to small, yes. Residential, hotel, mixed use, all to compliment
the St. Jude plans and the convention center plans. – You gotta remember, you got St. Jude
spending $3 billion. You’ve got Uptown
and Harbor Town, two spectacular
neighborhoods to the North, you have a major
investment and resources in the convention center
immediately to the South and everybody, the Pinch gets
a little bit of a bad rap because it kinda
fell into kind of a no man’s land for a while well that’s because the
pyramid was dark for a decade. And now you got Bass Pro that’s attracting a few
million people a year so and St. Jude has
actually bought a lot, some of the real estate going
into the Pinch district, what we had to develop really
within the Pinch district is not that big of a footprint. It’s very manageable,
it’s very do-able. – (Eric)
Right, Bill. – So some of these
ideas we’ve had before, the aquarium idea surfaced when
the city was fielding offers that included Bass Pro Shops where it was turning over ideas. I’ve seen I think maybe
five different versions of a pedestrian bridge to
the South tip of Mud Island from some point on
the mainland here. The difference with
this seems to be that yeah these are pieces that
will take as we can take them but it’s a concept. Which is kind of a new thing for a city that loves
studies and loves plans. So how have we gotten to this
point in kind of our planning? – I think that there
were just enough people who were interested in
capitalizing on all the activity that’s happening in various
ends of our downtown and decided to support
the concept plan and there’s just
finally enough activity where I think a lot
of that may happen because the pieces are
not so far apart anymore, the things that can
actually get done quickly, you know quickly let’s
say in a couple of years, are do-able and they’re sort of all coming together
at the same time. – How do we repurpose
our water front, make our water front more usable other than during
the month of May which obviously gets a lot
of use during Memphis in May. You know Mud Island has enormous
amounts of opportunities I think we could
be honest and say Mud Island’s been pretty
neglected, no fault of the RDC, no fault of the city it
just it is what it is, things changed and you know
so the city’s been looking at a long time of you know what
can we do with Mud Island, and of course the
convention center’s needed an overhaul for 20 years. Those things are all kind
of falling into place, there’s a momentum and a
not only a political will but a civic will to really
transform these missing pieces or these other
pieces of the puzzle and I think it’s the big
river crossing I mean we weren’t even talking
about the big river crossing five years ago now you know
what 100,000 plus people a year running back and
forth across here and of course the
lighting feature which is so wonderful
for our skyline, you know, things
are just happening. And they’re happening
at a, people talk about how fast things are
transforming in Nashville, well you know things
are transforming in Memphis and Shelby County
at a pretty rapid pace too and I know that announcement
a couple weeks ago probably caught a lot
of people by surprise, what an aquarium?
What a Brooks Museum? You know but no this
just didn’t happen in the last couple weeks, there’s been lots of work
that’s been going on this for months and months and months and there’s just a lot of
positive things coming together. – So are we gonna see changes in some basic
things like parking because if the Brooks
goes on that block it takes out a
parking garage there, Auto Zone has been talking
for the longest time about possibly moving its
parking somewhere else so do the basics along
with these parts like the aquarium and the Brooks
Museum possibly coming downtown, do the basic utilities I’ll
call them, change downtown? – Definitely on parking I spend
a lot of time talking about the puzzle pieces of parking and a lot of work has gone
into possibilities there I do understand
that there would be a significant amount of
parking under the museum but we’ve looked at other
options along the Riverfront but trying to preserve our
Riverfront and keep it off, you know, get it further off
and explore other options as far as transportation
to and from that but certainly everyone
is thinking about it, it won’t be forgotten, people
won’t lose all their parking, Auto Zone does
need to figure out their needs and their timing ’cause that’s a key component but right now it is a puzzle that we’re moving around
as pieces firm up. – And there’s also
the promenade property which created some
difficulties for at least one of the convention
center hotel proposals which was looking at the Mud
Island parking garage property. Is that garage still in
play for that at this point or is it too difficult? – Yes, it’s not. From my understanding
it’s not in play anymore, there’s several other sites
people are looking at, there’s plenty to pick from. – We moved off of that, the potential legal battle to
justify or not just, you know, to figure out if the
city could go on top of already an existing
parking garage with a hotel is just too daunting of a task, we don’t have that much time to, that’s a multi-year argument
probably in the courts if you ever try to test that. – We have probably
eight minutes left here, when people, define a
convention center hotel. ‘Cause people see
hotels downtown, they see new hotels going in, there’s a difference in
terms of what you mean when you talk about
a convention center. – Yeah, let me,
we got 22,000 plus hotel rooms in the
city of Memphis, we got 4,000 rooms
in downtown Memphis, we only have five hotel, we
got over 200 hotel properties. We only have five hotels
that are 300 rooms or larger. Only two of those hotels
are in downtown Memphis, the Peabody at 464 and
the Sheraton at 600. To be a convention center hotel, number one, you have
to be full service, you need to have a room
capacity of at least 500 rooms, 450 to 500 rooms,
and you need to be basically either attached or right next as
close as you can be to the convention facility. That basically leaves us with
one property, the Sheraton, that’s attached to
the convention center which it is our largest
hotel at 600 rooms. We desperately need another big full service
hotel in downtown. I know a lot of hotel operators probably cringe when I say that but the reality of it is there’s probably a
dozen hotel projects all in the 50 to
130 or 40 room range that are being kicked
around and talked about and some of them are
even under construction and those are gonna be nice,
and they’re gonna be great, but they’re not game changers. Game changers are big
full service hotels that can help drive
massive amounts of business and actually helps other hotels. – The theory there or the
business plan there is that there are certain groups,
associations, whatever, who won’t go to a city
unless they can take, basically know they’re
gonna get 200 rooms– – (Kevin)
You gotta have, you gotta have– – So they can’t go in
these nice new hotels that might be funded in part or supported in part
by DMC or others, they just aren’t gonna attract
a certain type of convention, a certain type of
gathering, is that? – If you got a thousand people
on peak, what we call peak, at the peak of a convention and you need 1,000
rooms on a peak night, right now we probably
will have to use a half a dozen or more hotels
in downtown to fill that need. Whereas if you had another
500 or 600 room hotel next to the convention center you could fill that
need with two hotels and be attached to
the convention center. The beauty of the
Peabody at 464 rooms, they have 88,000 square
feet of meeting space so they’re basically their
own convention center, they’re their own self-
fulfilling group house property from that standpoint. – Let me come back
to a couple things, we have five, six minutes
left, we talk about transit, trolleys are not
under your purview, I’m sure you wish they
were, but they’re not, but what is the
update if you have any on the trolleys
going back on line? – Sure, my understanding
is they are testing and should have one up and
running by the end of the year and then the main street line
within the next few months, then extending to
the Riverfront loop and it’ll be probably
18 months to two years before Madison’s fully on line. – And let’s go back to something
you said which you know it’s funny ’cause
we’re talking about this $550 million
worth of ideas, the Brooks coming downtown, you’re talking about convention
centers and 400 room hotels, you mentioned urban
art and you mentioned murals and lighting
underneath the overpass which is probably a project
that’s certainly under, what, $100,000, I don’t
know what it’s gonna cost, it’s probably, how much is it? – It’s a little more
than that, $150 ish, yeah. – Okay but a much smaller
scale and it’s interesting we were at a seminar
recently and Tommy Pacello who’s been on the show and runs
the Memphis Medical District talked about and has
been involved with lots of other revitalization
of various areas, he talks about and you talked
about the role of simple, relatively simple
things like urban art, like clear pathways and
well lit underpasses to get from the Pinch
to the convention center and vice versa. – (Kevin)
Bike share. – Bike share, those kinds
of smaller scale things, I’m not saying they’re tiny
but smaller scale things, why are those important and what more is on the
horizon on that front? – Because it doesn’t
matter, we could build, do the convention center,
build another hotel but if people don’t feel
safe walking one block then it does nothing
for our downtown. We need it to be connected
and for everyone, for it to be easy. Right now it’s difficult
to get from Main Street down to the river
because of the grade, we’re trying to improve that
and some of the plans show that with bridges and various
options to make that easier and people just wanna see
vibrancy all along the way and so we’re trying at
DMC to minimize the gaps so if there’s dead spots
we wanna light it up and do some temporary
art or do whatever we can to make those not
barriers to connectivity. – There was a time after
five o’clock at night because when you leave
the convention center if you wanted to
walk to the Peabody or you wanted to walk to
Beale Street down Main Street or even ride the
trolley, gotta realize that whole block
of government plaza shuts down at five o’clock
so that becomes dark. Then you got 100 North Main
and you got that next block that’s basically shut down and then you have to
really go three blocks before you get to where
the Marriott Courtyard and that collection of hotels
are right there at that block which you park on the other side which of course the
parks dark at night so there was a pretty big gap if you were staying
at the Sheraton attending a convention
at the convention center and you said let’s
walk down to Grill 83 or wherever you wanted
to go, Felicia Suzanne’s, you go after dark you’re
walking two or three blocks which doesn’t seem
like a big deal but you’re walking
two or three blocks where there’s not a lot of
activity, not a lot of energy, and we want to try to change it. – And that’s true
not just for tourists but of people who
might live downtown, people who visit downtown, people who live out
East or Midtown so. – So it’s important
to fill those gaps. – In the Pinch there’s been some strong businesses
that have hung in there through this dark
period of the Pinch and so this underpass art hopefully will give
people two options, go left or right out of
the convention center and frequent those
businesses as well so we’re excited about that. – A few minutes left, Bill. – So I wanna go back
to the Sheraton, the Sheraton has a relatively
recent new ownership there, is there any possibility that
they could do a third tower that would get us
part of the way to a room total that we need? – Possibly, I don’t
know if they could build a big enough
tower that would get us, I mean they’d have to
basically add 500 or 600 rooms and become a 11-
1,200 room hotel. I don’t know if they have
the capacity to do that, I will say this, Shulte
Hospitality out of Louisville are the new owners
of the Sheraton, this is the biggest
hotel in their portfolio, they’re very proud of it,
they’re investing money in it, they have plans to
invest millions over the next few years, they also have the
food service contract at the convention center and
they’re doing a great job, they’re coming out of the
gates with a lot of energy, a lot of passion, and they’re
a great partner so far and we’re just
thrilled to have them. – Couple more things, you
talked about dark spots, places that are not
popular right now, what, and I’ll turn to you, I’m not sure who
I should turn to so I’m gonna start with you, in terms of some of
the blighted buildings, when we talk about
all this progress but there’s still 100
North Main is empty, the Sterick is empty and the
areas around these building ’cause that’s the way it
tends to work are empty, South of the forum
there’s a bunch of vacant, not even surfaced parking lots near the hotel Chisca and
so on, what is, if anything, I mean can the DMC do anything
to compel property owners to get something done on those
blighted and empty spaces? – We can and we have a
list of priority properties that we work down
our available tools, in the highest
ones we are able to put pressure on the
owners to do things, for example, the Benchmark Hotel which is across from the Peabody has been a skeleton for a while, they recently put up a banner showing their flag of the
hotel that’s gonna be coming and showing that
they’re on target, that was because we said
we’re gonna take legal action if you don’t show
us some progress towards finishing this project so to the extent when we
have to we can do that but we work at all
different levels and we often hire consultants to help us try to save
properties that need a little– – Let me say this. – Just a minute left, go ahead. – Well let me just say this
in my 25 years downtown I have never been meeting with so many hotel
developers as I am today, I’ve never seen so much activity with those empty buildings
including the 100 North Main and Henry Grovner
and his project with the Sterick Building which he’s gonna do
something great there, I mean things are happening and downtown is being
gobbled up right underneath, a lot of out of town money
as well as some locals. But there’s a lot of
great things happening. – You and I had conversation
about some of these numbers which are huge
numbers to me and you in other cities are so
much more expensive. – We’re still a good deal,
we’re still affordable and we’re still a good deal and out of town
people recognize that. – Alright that is
all the time we have thank you both for being
here, thank you Bill, and thank you for joining us. Join us again next week. [intense instrumental music] [guitar strums]

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