The two big uglies I see most often are Sears Crosstown and the Chisca Hotel. I live near Sears and work near the Chisca, which is just southwest of FedEx Forum so you can’t miss it if you go to events there.
The Chisca is one of those buildings that has an air of inevitability around it because it has been on the downtown landscape for so long. Owned by the Church of God In Christ (COGIC), it was built in 1910 or 1911. It was expanded to include an Admiral Benbow Inn and a parking garage. The Chisca has gotten a bit of attention recently due to an Elvis-era connection via Fifties disc jockey Dewey Phillips and Tony Award winner “Memphis,” the 2009 musical. It separates Beale Street and FedEx Forum from South Main, The Orpheum, and the National Civil Rights Museum. The reddish brick building has painted plywood in the windows.
One of the would-be redevelopers is Terry Lynch. His group’s proposal estimates the cost of renovation at $19.8 million. The group is in the early stages of seeking City Council approval for $2 million in capital improvement funds. Here are excerpts from a recent conversation I had with Lynch.
Why save it?
The alternative is tearing it down and having a vacant lot. One of the big benefits of FedEx Forum was supposed to be economic development around the arena. But it’s still mostly vacant lots and blight that really breaks up the fabric of South Main and the Central Business District.
Is it an old hotel that will always seem like an old hotel?
The original rooms were wide with a lot of windows — this was before air-conditioning — and nine-foot ceilings. So we’re thinking of taking a couple of hotel rooms and making them into a small apartment, with a goal of 149 apartments, with plenty of natural light.
Is there enough demand for housing there?
Our studies show strong demand. The occupancy rate for downtown apartments is above 90 percent. Barboro Flats has been well received. We think a good price point for this would be $750 to $800.
Could it be fully or partly redeveloped and wind up like the empty Horizon on the South Bluff?
The Horizon was a condo building. There is always a risk somebody won’t come. But we think there would be good demand. I don’t think you will find any unsuccessful apartments downtown.
Why undertake this now when it’s been vacant for so long?
It’s a challenging property. In one of the best real estate cycles in years it was passed over. It takes local, civic-minded people to get involved. Either it happens now or it is going to be demolished in the next year or two. It has been in Environmental Court for a couple years and the court will get impatient about it.
Does the proposed $2 million in city funds make that much difference?
Yes it does. Ten percent might not seem like a lot, but it is in this project. It would offset unusual costs of development such as environmental remediation, structural issues, and selective interior demolitions like an old ballroom in there. If you took on a warehouse, you would not have all of that.
Could COGIC benefit financially?
We have a confidentiality agreement so I can’t say much. It would put it behind them. From what we can tell, there are no liens or environmental fines on it.
What would be the development fee?
Typically three to four percent.
Is the Memphis music and nostalgia connection that relevant?
I think so. We’re thinking of taking the old studio on the mezzanine level and rebuilding it on the ground level so people could come and see it.
What’s next?
The council appropriation, then the Downtown Memphis Commission for a PILOT (payment in lieu of taxes), then the Downtown Parking Authority for approval. We feel fairly comfortable about all of them.
