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Memphis to take bids for Fairgrounds hotel-retail site and Mid-South Coliseum

By Published: November 20, 2018 5:01 PM CT

Buoyed by a state-approved tourism development zone, the city of Memphis will take bids for a hotel-retail developer on the Fairgrounds site as part of a $161 million public-private project and go after a private operator as well to repurpose the Mid-South Coliseum.

Mayor Jim Strickland said Monday the city will start the process to take requests for proposals for the private part of the development, 13 acres on Central Avenue, in addition to courting corporate sponsors for the naming rights on a youth sports complex to be a major part of the Fairgrounds site. A developer would be selected in early 2019, according to city information.

Private investment in the project is expected to be $61 million, and the city will put in $90 million, city officials said.

Not only does Memphis want to go to work on a facility that will reshape 22 acres on the Fairgrounds property, it hopes to revive older buildings, too. Ultimately, city officials said, improvements could be the catalyst for bringing the Mid-South Coliseum back to life after more than a decade of dormancy.

“Getting the TDZ is really, really big,” said Marvin Stockwell, co-founder of the Coliseum Coalition and Friends of the Fairgrounds in Memphis.

He credits the Memphis city government for its work on the project and for keeping grassroots groups involved, including those who want to see the Mid-South Coliseum rise again. Stockwell said he believes the coliseum, which hasn’t been used regularly since 2006, could hold multiple types of events and even become the home for a wrestling hall of fame.

The State Building Commission Executive Subcommittee gave approval Monday for the city to set up a tourism development zone (TDZ) from which it would take sales tax revenue to pay off debt for the project. The city is expected to use $50 million in proceeds from the zone, and Strickland assured the state panel Memphis would take any excess money from the area to start paying off debt early.

“This is a different project and a very much different approach than in 2013," said Strickland, whose administration changed the scope of the Fairgrounds project from that of his predecessors. "This project will be funded with TDZ funds and substantial private dollars. If there are no private dollars there will be no project.”

Strickland said the subcommittee’s approval enables the city to move forward with taking proposals from the private sector. Once the city gets commitments from the private sector for a hotel-retail site, Memphis can borrow the funds for the work, which also must be approved by the state.

Strickland’s administration is planning a 3-square-mile TDZ where sales tax revenue would be used to finance a reconfiguration of the Fairgrounds, with the indoor youth sports complex as the central feature on East Parkway at Southern Avenue where the Libertyland amusement park was located.

The proposed TDZ boundaries extend beyond one mile from the perimeter of the facility “as necessitated by the mix of commercial and residential areas surrounding the fairgrounds,” according to the state’s review, but the proposed 2.97-square-mile zone doesn’t exceed the maximum 3 square miles allowed by state law.

If the State Funding Board gives approval, the city of Memphis would issue bonds in late 2019 or early 2020 to finance construction. The state also would review and approve the payback plan.

Tennessee Comptroller Justin Wilson, a subcommittee member, said he was “very suspicious” of the project initially but was much more confident with the city’s approach after hearing its new presentation. The subcommittee gave unanimous approval in a voice vote.

Bouncing on youth sports

Memphis wants to take advantage of the youth sports industry, Strickland explained to subcommittee members, noting thousands of families take mini-vacations, stay at hotels and eat at restaurants while their children are playing on competitive travel teams.

“I know this because my son did it for two years, and we went all over the Midwest and Southeast playing basketball,” Strickland said. “We have done a lot of research in Memphis. We evaluated it to make sure our position as a sports complex is in a competitive niche and that we can shine in our area for basketball, volleyball, indoor track, mat sports and cheerleading.”

Youth and amateur sports are among the fastest-growing parts of the sports tourism industry and considered “recession resistant,” according to Paul Young, Memphis director of Housing and Community Development.

The industry generates $10 billion to $15 billion annually, even during the Great Recession, he said. Memphis contends it can fill a void regionally in the competitive arena.

Memphis’ proposed youth sports complex would have a 100,000-square-foot column-free space for a 200-meter Mondo Super X hydraulic banked track, 12 basketball and 24 volleyball courts, and could be set up for sports and trade shows, special events and graduations.

The impact from direct visitor spending is projected at $120 million during the first five years and nearly $1 billion over 30 years, according to the city’s presentation. The Memphis facility is projected to break even in year five and become self-sustaining.

“If the money and the numbers don’t work out, we will not move forward with this project,” Young told the subcommittee.

Young acknowledged the TDZ is oddly shaped because the city wanted to capture the commercial area around the Fairgrounds to maximize revenue but “carve out” residential areas.

The zone encompasses Crosstown, Broad Avenue, the Union Avenue corridor, Overton Square, Cooper-Young, Historic Melrose, and the Park/Airways/Lamar retail area.

Phase one of the project is complete, including Tiger Lane, Liberty Bowl Memorial Stadium improvements and site preparation for phase two.

Phase two involves the youth sports complex, which would open in 2021 or 2022. In addition, more Liberty Bowl improvements are planned, including replacing the west tower, improving the ability of fans to move around the stadium and upgrading signs and digital displays, as well as concessions and restrooms.

The site on Central Avenue, which calls for an option to add six acres, includes a hotel with 80 to 120 rooms, 30,000 to 50,000 square feet of residential space and restaurants, offices and residential space.

Other campus improvements involve rehabilitating the Creative Arts Center, improving the exterior of the Pipkin Building, connecting to Shelby Farms Greenline, improving three Southern Avenue underpasses and improving bicycle and pedestrian safety on Central Avenue.

The third phase, affecting several other buildings on the Fairgrounds site, would begin within five years of completion of the phase two and would be limited to $30 million in TDZ funds.

It includes entrances and public art, parking, Pipkin Building expansion and improvements, upgrading of Tobey Park, creation of a tourist attraction at historic Melrose High School, infrastructure improvements to bring in private retail and hospitality investments, and expansion of on-site hospitality onto a lot behind the Fairview building in partnership with Shelby County Schools.

Topics

Jim Strickland Paul Young Justin Wilson
Sam Stockard

Sam Stockard

Sam Stockard is a Nashville-based reporter with more than 30 years of journalism experience as a writer, editor and columnist covering the state Legislature and Tennessee politics for The Daily Memphian.


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