With a $16 million renovation, a blighted Downtown block will become the latest mixed-use historic renovation project in the vein of Crosstown Concourse.
With a $16 million renovation, a blighted Downtown block will become the latest mixed-use historic renovation project in the vein of Crosstown Concourse. SouthernSun Asset Management, an equity firm based in East Memphis, will relocate its headquarters to two floors of the Hickman Building building at 240 Madison Ave.
The westward migration could mean the tide is turning for Downtown office vibrancy.
Completed in 1926, the neo-gothic building has sat vacant since 1971. Adjacent to the eight-story property is a dilapidated covered parking structure and a former Veterans of Foreign Wars building.
Investor Walk-Off Properties bought the three buildings in 2015 effectively controlling the stretch of North Fourth Street between Madison and Court avenues.
The development team, along with LRK Architects, plan to cobble the buildings together to create a mixed-use complex including 40 apartments ranging from 450 square feet to 700 square feet, 5,000 square feet of ground floor retail, office space for SouthernSun and additional tenants, an outdoor courtyard and covered parking.
“If you look from Crosstown to Downtown, it seems to me that we're at a place where we can be connecting the two in my lifetime,” said Michael Cook, founder and CEO of SouthernSun and an investor with Walk-Off Properties.
SouthernSun’s February announcement follows ServiceMaster’s bold move
from East Memphis to the shuttered Peabody Place mall in the heart of the Downtown core. When the $27 million project renovation wraps in late 2017, Memphis’ fourth largest public company will relocate its 2,000 employees to what was once a vibrant entertainment and retail hub.
Cook said that SouthernSun’s plans to relocate to the Hickman Building predate ServiceMaster’s announcement. He sees the two companies as working together to reinvigorate the Downtown office market which has suffered from an exodus of law firms and banks in recent years.
“We have gone through, in my view, long enough in this time where business people fled Downtown for the suburbs. That always creates decay,” Cook said. “You lose the middle class workers, they drain the tax base as it depopulates and abandons.
“This made the most sense for us quite frankly. At the very least we hope our move just simply and faithfully supports the Downtown economy.”
The building was most recently used as the Medical Arts Building. The ground floor was home to medical specialists with individual bays. Those 1,000-square-foot bays will be converted for retail tenants.
Cook said that he wants to recruit retail tenants that are aligned with the building’s turn-of-the-century origins, such as a rare bookstore or a vintage jewelry shop. He said that a “local sustainable grocery store” is also a consideration.
Walk-Off Properties is reserving an area near SouthernSun’s offices for a coworking lab to be used by nonprofits.
The top floor, which once served as a meeting room, will be converted into a penthouse suite.
“The challenge is it has historic bones. The terracotta is still there,” said LRK principal Rob Norcross. “We’re going to have to restore as opposed to maintain the character, so we're going to have to be a little more disciplined about the materials we put back into the building.”