Wednesday, February 25, 2015

We've moved!

Our run on Blogger has come to an end, with the Observer's new publishing platform and website. You can find us online at our new home at See you there!

Retail vacancy, rents vary widely

Real estate analysis firm Karnes recently published its fourth quarter statistics on vacancy rates, rents and inventory in the Charlotte region. The charts show some interesting facts about how local retail space is distributed and how expensive it can be.

First, the vacancy rate (mouse over the columns for exact percentages and figures). Cabarrus County has the lowest rate locally, while northeast Mecklenburg has the highest.

Next, let's look at inventory. Cabarrus County, with the lowest vacancy rate, also has the single largest retail square footage of a submarket (but much less than all the submarkets in Mecklenburg put together). Uptown, with a fairly high vacancy rate, also has the smallest amount of available inventory.

Uptown, with the smallest inventory, also has the highest average rent, at $31.65 a square foot. That could be a barrier for booster groups like Center City Partners that want to draw more retailers uptown.

Here's a map of the Karnes retail submarkets in Mecklenburg.

Tuesday, February 24, 2015

Want vacant office space? Depends where you look in Charlotte

Charlotte's office vacancy rate dipped 0.1 percent in the fourth quarter, to 14.3 percent, according to real estate analysis firm Karnes. But within different markets, there is a huge variation.

Midtown has the lowest vacancy rate, at 7.5 percent. Uptown, the largest office submarket by far, has the third-lowest rate, at 11.2 percent.

But on the other end of the spectrum, the Park Road submarket had a vacancy rate of 23.3 percent, while east Charlotte's rate clocked in at 25.9 percent, the highest in the city. That means more than a quarter of the office space in that submarket is empty.

Here's how the city's submarkets stack up:

Update: Here's a map with the submarkets broken down.

Monday, February 23, 2015

Statesville Road Marriott still stalled as lawsuits drag on

A half-finished Marriott hotel at Statesville and W.T. Harris roads near Northlake Mall is likely to sit that way for months to come, as the owner and contractor fight over payments and workmanship in court.

Since taking on the development beat, I’ve fielded a half-dozen inquiries about this property. The hotel was supposed to be a 118-room Courtyard by Marriott, and had been slated to open more than a year ago. So I called the owners to see if anything has changed.

Instead, the building has sat unfinished at the prominent intersection right off Interstate 77. The owner, Raleigh-based MJM Group, and the general contractor are stuck in court. The contractor has sued MJM for payment, but MJM has refused to pay because it says the work that was done has severe defects and the building would be too costly to repair.

Meanwhile, many of the subcontractors have filed liens and lawsuits as well, leading to a flurry of cases in Mecklenburg court, but no hotel.

Matthew Lee, an attorney representing MJM Group, said the owner and contractor are set to hold an arbitration hearing in late spring.

MJM bought the land in Sept. 2012 for $1.9 million, real estate records show.

Friday, February 20, 2015

7th Street Public Market now almost a $3 million enterprise

One of Charlotte Center City Partners' biggest pushes is luring more retail to match the influx of people and office space uptown, and the economic development group is holding up 7th Street Public Market as an example of success.

The market opened in late 2011 opening and is now 100 percent leased, officials said at Center City Partners' meeting Thursday.

Sales grew 40 percent last year, and the multi-merchant market came in just under $3 million worth of sales for all vendors. There are a variety of stores at 7th Street Public Market, from a cheese vendor to a coffee shop to a bar with local beer.

The market is located in a former Reid's grocery store, and funded by Blue Cross Blue Shield North Carolina, Carolinas Medical Center, Center City Partners and other businesses (full list here).

Here are some other highlights:

  • The market has installed a demo table, with eight classes or demonstrations planned for this month. 
  • There's a community room available to non-profits for free, and potentially for other groups to rent.
  • The market is offering classes in small business capital funding, payroll and marketing, to further its role as a business incubator.
So, what do you think? Are you a 7th Street Public Market fan? Do you think efforts like this are the key to drawing retail back to uptown?

Thursday, February 19, 2015

Crescent Uptown architect posts more details on project

Uptown is set to soon see its first Whole Foods, along with 450 more upscale Crescent apartments. Now, the project's architect, The Preston Partnership, has posted some more details about the project's bells and whistles online.

The company's official project description is on its website. Here are the highlights:
  • "The 3.6 acre site includes a 12-story, 116 unit apartment tower over 9 levels of parking, and a 5-story, 332 unit, type IIIA wood frame apartment building, over a shared 2 level parking and retail podium. Crescent Charlotte Uptown offers residents every convenience with over 15,000 square feet of shops and restaurants, anchored by Charlotte’s first vertically integrated Whole Foods Market at 47,000 square feet."
  • "Amenities include a stunning saltwater swimming pool with a mixture of private cabanas, outdoor living spaces, fireplaces and outdoor media. The bottom floor of the high rise features a contemporary clubroom for entertaining and social events, a tech lounge with multiple computer stations, and an adjacent amenity building features a state-of-the-art fitness center and yoga room, and an outdoor kitchen with grilling stations. Perched atop the 12 story tower, residents have access to a spacious amenity terrace with panoramic views of uptown Charlotte."
The project is also supposed to include two hotels with 300 to 400 rooms total. Crescent Communities has said it's still negotiating with hotel groups and will announce the hotels later. The company is also buying the adjacent parcel, currently home to Club Caviar, as part of the project.

Wednesday, February 18, 2015

Big plans afoot around University City light rail

A few weeks ago, I wrote about Carolina States Regional Center's plans for a 37-acre mixed use development with about 1,000 apartment units around the Lynx Blue Rail extension. Now, a separate group is marketing 60 wooded acres across Tryon Street as another potential major mixed-use site, with retail, apartments, offices and a hotel.

The development would be across Tryon Street from the University City Boulevard light rail station and parking garage. The land (map below) is owned by brothers David and Tim McKinney.

"This is the most unique real estate play in all of Charlotte currently," said Tim McKinney. They have a website,, set up to market the property, complete with possible site plans.

The land, with Tryon Street on the left.

David McKinney said the intense focus on neighborhoods close to uptown and major apartment develops has caused developers to neglect the University City area.

"I think even some of the developers are a little tunnel-visioned right now," said McKinney. "(The University area) has been overlooked."

McKinney said that's all changing with the light rail extension, which runs right up Tryon Street next to the property. He said the brothers have been receiving a lot of interest in the site, both from local developers and some from out of town.

The land is currently zoned for business, residential and mixed-use. The brothers say it could be rezoned for transit-oriented development - the popular zoning designation that allows denser uses around mass-transit.

David McKinney said they would like to see the parcel developed as one block, but aren't opposed to subdividing it either.

Tuesday, February 17, 2015

Sedgefield Shopping Center demolition to start in 2nd quarter

Sedgefield Shopping Center will soon be no more, as the retail complex's owners prepare for demolition that will make way for a new, mixed-use development.

A representative of owner Marsh Properties told me recently that the company plans to start demolition and site work on the South End location in the second quarter this year. After that, construction on phase one of the $190-million mixed-use redevelopment is set to start. A Harris Teeter, along with 14,000 square feet of retail space, is set to deliver in early 2017. That will be followed by 300 apartment units.

The planned redevelopment covers more than the shopping center: The area totals 59.4 acres, extending east of South Boulevard along Elmhurst Road. You can see a PDF of a detailed site plan, with roads and different development phases, online here.

Sedgefield Shopping Center is far from the only project going on right now on that stretch of South Boulevard.

  • Pepsi Bottling Ventures is looking to sell their 5.2-acre site across the street, at South Blvd. and New Bern, marketing it as a major redevelopment opportunity.
  • Developer Peter Pappas is looking at a site at Remount and South Blvd. for a new apartment complex.
  • And Publix is set to open in March or early April a few blocks north, where Camden is also building a 266-unit Camden Southline complex.

Monday, February 16, 2015

Up for zoning: Cherry homes, offices, cell tower

It's the third Monday of the month, so that means it must everyone's favorite City Council get-together: The zoning meeting. UPDATE: Zoning meeting has been rescheduled for Wednesday, because of the impending IceMaggeddon.

Up this week are a development in Cherry, a new office tower on West Morehead Street and a cell phone tower.

Here's a look at what's on the agenda for Monday night:

West Morehead Street offices: CitiSculpt has filed to rezone 1.4 acres at West Morehead and South Summit streets, just barely outside the I-277 loop. As I wrote earlier when they announced the plan, the company is planning to build an office mid-rise with 70,000 square feet space, including street-level retail. This is up for a hearing, and staff recommends approval.

Cherry multifamily: This project by Laurel Street residential at Baxter and Avant streets in Cherry has garnered a protest petition from residents, but it's not clear the protest will reach the required threshold. Laurel Street Residential wants to rezone 1.87 acres to allow the building of a small, infill development with 30 multifamily units, including an affordable housing component. The project is up for a hearing. Staff recommends approval.

Here's a sample of a resident's concerns and hopes, quoted from the required community meeting report: "I have been in Cherry for 70 years, I grew up here and we need affordable housing. We are in small homes, and people come in with more money and 5 build $500,000 homes. You built your homes next to my little house. We didn’t ask you all to come in here with your money to build these big houses but you came, and we don’t have a problem with that. We are okay with change. I don’t have to like what you are doing, but I’ll love you anyway. It is not about race because we all bleed red. I pray every night that this project is completed because we need affordable housing in this community."

Daycare: A proposed daycare on 2.7 acres on Prosperity Church road drew a protest petition, fueled by the typical concerns of noise and traffic. The daycare is up for a vote, and staff recommends approval.

Dilworth townhouses: The developer has requested the hearing be pushed back a month, to March. The proposal which would allow 9 townhouses on 0.4 acres on Kenilworth Ave., next to the East Blvd. Harris Teeter. Neighbors have raised concerns about traffic, on-site dumpsters, whether the driveway is too narrow, and whether the units are priced too low, at $350,000. Staff recommends approval.

Office building: Invue Security is seeking to tear down a shopping center just south of Pineville-Matthews Road, between Carswell and Baybrook Lanes. The company would build a 75,000 square-foot, three-story office building, with 18,000 square feet of retail space, and use it as its headquarters. Staff recommends approval. This is up for a hearing.

Cell phone tower: While it might appear less interesting than some of the other petitions, I thought this was worth noting. SIM USA, the Christian missionary aid group that came to the public's attention when two of its staff were infected with Ebola while working in Liberia, wants a bigger cell phone tower on its southwest Charlotte campus. Although some neighbors, have complained, the tower is more than 1/3 of a mile from the nearest streets and houses. SIM USA will use microwave equipment on the 199-foot-tall tower to communicate with its Fort Mill campus, while Verizon and T-Mobile will use the tower to mount cell phone equipment. Staff recommends approval.

Friday, February 13, 2015

Dirt is moving again at Stonewall and S. Caldwell - what's next?

There's been a lot of buzz about Stonewall Street lately, with Crescent Communities unveiling its plans for Crescent Uptown at Stonewall and South Caldwell streets. The developer is buying vacant, city-owned land across from the NASCAR Hall of Fame for the project - and there's another big city-owned tract on the other corner of the intersection.

This week, construction crews on the land (map below) have been moving the big mound of dirt that's been there since Proffitt Dixon started using the parcel at its construction yard for the Fountains Uptown. That prompted a reader to ask me if a mega-development is in the works for that 3.8-acre parcel as well.

I asked Deputy City Manager Ron Kimble. He said the land hasn't been sold yet, but the city is actively marketing the property and there's been "moderate to heavy interest shown in it lately."

And the recent dirt movement? Kimble said that's normal, because the apartment builders agreed to return the site to its prior (flat) condition once they wrapped up Fountains Uptown. The $40 million project is set to open later this year.

So, nothing to report here yet - but expect this parcel to move before too long.

Thursday, February 12, 2015

Charlotte's apartment boom in one chart

If you live in Charlotte and have eyes, you've seen the apartment boom, with new, high-end units springing up like a plywood army surrounding uptown. I even wrote a column about it last week (the tl;dr version: Vacancy will go up this year and next, but we're not at a full-fledged bubble yet).

Here's a chart of data pulled together by the folks at CMD Group that shows the rocket-ship-trajectory of multifamily building in Charlotte:

As you can see, multifamily building permits cratered in the recession's aftermath, with fewer than 1,000 pulled in 2010. That's the lowest point in a decade. But demand rebounded swiftly: Permits passed pre-recession highs in 2012 and hit a new high last year, passing 6,600.

CMD Chief Economist Alex Carrick said he expects the boom to continue. The reasons are myriad: Millenials postponing marriage and kids while they pay off student debt, older empty-nesters downsizing from the big house in the burbs to an apartment or condo, a cultural shift back to walkable cities.

I asked Carrick if he thinks we're looking at a dangerous bubble down the road. What happens when all of those Millenials want to have kids and buy the house with the backyard, say in 10 years?

"That is a danger," said Carrick. "At that time, there might well be a whole bunch of problems, some empty, see-through buildings. But developers never worry about that. They know there's a demand right now."

"You can worry about 10 years from now," said Carrick, But everything changes so rapidly, you don't know what's going to happen."

Wednesday, February 11, 2015

Dueling spec office towers show off their stuff

Crescent Communities and Portman Holdings are both getting ready to start work this summer on uptown's first spec office towers since the recession. But online, the developers already have websites and videos set up to tout their two towers.

First, Crescent's Tryon Place: The website for this 27-story tower at South Tryon and Stonewall streets is slick and highly produced. It includes a video about place-making and mixed-use development that makes you want to cheer like the end of "Rocky."

The website includes more concrete information about Tryon Place and information about pre-leasing. The tower also has its own Twitter account, but has yet to send a tweet. Same for Pinterest.

(That's Tryon Place on the left there, the blue-green building. Note that 615 S. College does not appear in this rendering.)

Also, don't forget Crescent's plans for a Whole Foods and 440-unit apartment development on Stonewall, at Caldwell Street.

Over at Portman's 615 S. College, the website for the 370,000-square-foot office tower is also pretty slick, with plenty of pretty renderings and what appears to be a video shot by a drone (anyone see one hovering out their window?).

Views: 615 S College Street from PortmanHoldings on Vimeo.

So, which website do you prefer? And - most importantly - which tower do you think will have an edge attracting tenants?

Tuesday, February 10, 2015

291 apartments proposed in Steele Creek

An Atlanta-based developer is seeking to build a 291-unit apartment complex in southwest Charlotte, according to a rezoning petition filed last week.

Buildings on the 17-acre site on West Arrowood Road (map below) would be three stories, according to the paperwork filed by TWO Capital Partners. The land is currently used for houses, with much of it vacant and wooded.

The site plan for the proposed apartment complex shows seven clusters of buildings, a club, poolhouse and a natural area with a water feature.

I couldn't reach Wes Taubel, the TWO Capital Partners executive leading the project, for more details. The petition is set for a public hearing at the City Council zoning meeting in April.

The company is building a 214-unit, high-end complex called Capital Creek in Wake Forest. Click here for a description of the project and a look at what they likely have in mind for Steele Creek.

Monday, February 9, 2015

New Plaza Midwood apartments will preserve most retail space

Tribridge Residential has torn down a pawn shop to make for a new, 246-unit apartment complex at Central Avenue and Clement Avenue, but the company says three other existing stores on the site will remain.

The company finished demolition of the pawn shop and warehouses (map below) on the property last week, Tribridge vice president Yates Dunaway said. Tribridge is now starting work on the apartment complex.

The remaining shops - Something Classic, American Beauty and Jackson Hewitt - total 18,000 square feet. They'll remain on the site, Dunaway said. The company bought the 5-acre site in December for $5 million.

Here are the vital stats for the apartment complex:

  • 246 units, a mix of studio, one- and two-bedrooms.
  • Amenities will include a pool, fitness center, club room and high-end interior finishes.
  • The buildings will be four and five stories tall, and will wrap around a parking deck.
Charlotte is in the midst of an apartment boom with 10,000 units being built and about 10,000 more planned, an all-time high. Think we're in a bubble? Check out my story from this weekend and let me know what you think.
A rendering of the future apartment building at 1305 Central Avenue

Apartment plans moving forward on Stonewall Street

Plans for a new mixed-use, 440-unit apartment complex at Stonewall and South Caldwell streets are moving forward, according to paperwork filed last week.

The 3.6-acre vacant parcel (map below) is owned by the city of Charlotte. According to paperwork filed Friday, Crescent Communities is going ahead with plans to develop the site.

Here's the full description of the project: "Crescent Uptown• Detailed Scope of Work: Mixed-use development with ground floor retail, structured parking, mid-rise apartments, and high-rise apartments. Approximately 440 units and 47,000 sf of retail."

Crescent confirmed the basic details, and said more information should be available soon, so stay turned. Fun fact: This parcel was the fenced-off (and mostly unused) "free speech zone" for protesters during the DNC in 2012.

Crescent is busy around town these days building Crescent SouthPark and Crescent Dilworth, upscale apartment complexes set to be finished later this year. And a few blocks away, at Stonewall and Tryon streets, Crescent is planning to start construction this summer on Tryon Place, an office tower.

So, Charlotte's apartment boom continues. Check out my story last week about the boom for some more context.

(Shout-out to the guys at Urban Planet for noticing these plans first)

Friday, February 6, 2015

Mixed-use around the Blue Line extension

In addition to moving people around, the Lynx Blue Line light rail extension is meant to spur development along its path. Some recent rezoning filings show it appears to be reaching that goal.

Carolina States Regional Center is seeking to rezone two parcels along North Tryon Street for transit-oriented, mixed-use development. The first petition was filed in January for 15 acres, while the second was filed Wednesday for an additional 22 acres. (There's a map below of both sites)

"We consider these developments as the gateway to the University City area," said Dandan Liu, with Carolina States.

For the 15-acre site, Liu said Carolina States wants to develop a 350-unit apartment complex. The rezoning hearing is set for March. Plans are still in the works for the 22-acre site, but Liu said the parcels could support 1,000 apartments total.

Both sites are close to the planned light rail, between the Tom Hunter and University City Boulevard stops. The 22-acre site is directly adjacent to a light rail parking garage. When asked how important the light rail is to making the projects work, Liu said: "It is the key."

Thursday, February 5, 2015

Two fill-in home projects planned in Dilworth

Two projects a block apart in Dilworth are up for rezoning soon, and if approved they would fill in small lots near Kenilworth Avenue and East Boulevard with dozens of housing units.

First up: A petition to rezone about four tenths of an acre at Kenilworth and Fillmore avenues. The plan would allow building nine townhouses on vacant land next to the Kenilworth Commons shopping center. The rezoning, submitted by Meeting Street Homes, is up for a public hearing before city council on February 16.

Elevation of proposed townhouses, from rezoning petitions
Next up: NORCO LLC wants two rezone about two tenths of an acre a block away, at Fillmore and Scott avenues, to allow the construction of up to 24 multi-family attached houses. The petition is up for a public hearing on March 16. Check out the location of both infill pockets below.

I live in this neighborhood, and it's been pretty interesting watching the changes over the past several years. With all of the hulking apartment projects under construction nearby featuring hundreds of units, this scale of infill development is a nice change of pace.

Wednesday, February 4, 2015

West Morehead apartments to break ground this year

The West Morehead corridor is popping these days, and a Charlotte developer plans to add to the boomlet with a 283-unit apartment complex planning to break ground in mid-summer.

Southern Apartment Group - a subsidiary of CitiSculpt - bought the land at West Morehead and Summit Streets in 2013 and 2014. The two parcels total a bit more than 3 acres. Lindsey McAlpine, CitiSculpt's managing partner, said the company has already started early work on the site.

"We're in design, and we've started some demo on site," said McAlpine. Construction on the complex is set to begin in mid-summer. McAlpine said he hasn't formally branded the site yet, but he's kicking around "Stadium West."

CitiSculpt is also developing a 70,000 square-foot office down the street at 1213 W. Morehead St., along with the Knox Group.

McAlpine said "Stadium West" will have lower rents than the luxury units that are springing up on seemingly every corner in Charlotte. "This will really be a value play," said McAlpine.

He also said the area won't be as "crowded" as the South End corridor, which has exploded in recent years as the epicenter of new apartments. McAlpine said the area's walkability, with spots such as Rhino Market and Pinky's, will help draw creative-class workers seeking an urban lifestyle.

Tuesday, February 3, 2015

Riverwalk adding YMCA, office, industrial space

Riverwalk, the Rock Hill mixed-use development on the Catawba River, plans to complete several major buildings this year, adding to the boom along I-77 south of Charlotte.

The 1,000-acre development includes industrial, office, residential and retail space. Here's a look at what will be finished this year:

  • YMCA: The 30,000-square-foot building will go vertical in February and is expected to be completed in October. 
  • Industrial: A 277,000-square-foot spec building is set for an April completion date.
  • Office: The BNA CPA building (which is named for an accounting firm) is well underway, with office and retail tenants moving in this July.
  • Retail: The River District Building is set to open in October. Riverwalk Town Center is expected to start pre-leasing retail space in February, and the Pump House restaurant plans to open this summer.
“This is really shaping up to be exactly what we envisioned - a unique, very active community of people with similar interests and zest for outdoor activities," said managing director Dave Williams, in an email.
BNA building under construction (photos courtesy Riverwalk)

The Giordana Velodrome at Riverwalk

Monday, February 2, 2015

Pappas accelerating South End apartment plans

Charlotte developer Peter Pappas says he's speeding up his plans for South End, with a new apartment complex at South Boulevard and Remount Road under consideration.

The possible new complex by Terwilliger Pappas - an apartment firm Pappas heads - is still in the early stages. Pappas is studying a parcel of land at the South Boulevard intersection, but said it's too early to have details such as a timeline for construction or possible number of units.

"The south corridor continues to be an area where Terwilliger Pappas would like to focus and allocate capital," said Pappas. He said the success of recent leasing activity, combined with more retail and restaurant options, make the area more appealing. South End is one of the fastest-growing apartment markets in the city, with new complexes such as Camden Southline coming online and more under construction. The area also has a new Publix soon to debut, along with a major redevelopment of the Sedgefield Shopping Center anchored by a Harris Teeter planned.

Terwilliger Pappas has four Solis-branded apartments under construction or planned in Charlotte, including Solis Sharon Square, Dilworth, Waverly and Ballantyne. Together, those apartments total about 1,000 units.

Pappas has been trying to build a mixed-use development at Scaleybark Station on South
Boulevard since 2007. He has said the recession stymied plans.

"While we are just beginning to study the South Boulevard and Remount site, we are also actively pursuing development plans at Scaleybark Station, a transit oriented development that that will include a mix of office, hotel, retail, for-sale and for-lease housing," said Pappas. "The strong residential leasing activity over the last 12 months has prompted us to accelerate our plans on both parcels at Southline and Scaleybark."

You can check out marketing materials for the planned Scaleybark development here. The development plan - which would include up to 850 residential units and more than 450,000 square feet of office space - is below. Stay tuned for updates on both of these projects as they get more firm.

Friday, January 30, 2015

Homebuilder betting on Blue Line, Belmont area

Modern homebuilder Dialect Design is betting that the light rail extension will spur interest in Charlotte's Belmont neighborhood with a plan to build custom houses in the area.

Dialect's design
Belmont, wedged between uptown, NoDa and Plaza Midwood, has remained largely immune to gentrification, even as the neighborhoods around it are taking off. Dialect has five lots in the neighborhood ready to build on, said Toby Witte, the company's co-founder. One has been sold and is ready to start construction.

"It's light rail, to put it bluntly," said Witte, asked why he's pursuing this market now. "Our office is in NoDa. We've been driving through Belmont, not trying to linger so long...It will be a desirable neighborhood in no time."

The neighborhood's Parkwood stop is the first Lynx Blue Line extension stop north of uptown.

Witte said the houses his company plans to build will appeal to a "hip, urban" set, people who want to live near the city's center.

The "S-series" houses will:

  • Be 2,030 to 2,450 square feet
  • Feature an open floor plan, with 4 bedrooms, 2.5 baths, and a "second floor roof terrace with skyline views of uptown for selected sites." 
  • Start at $305,000

Thursday, January 29, 2015

Solis Sharon Square apartments 70 percent leased

Terwilliger Pappas' newest apartment development  - Solis Sharon Square - is about 70 percent leased, developer Peter Pappas told me on a recent tour of the property.

The upscale mixed-use development has also leased about half of its retail space, with restaurant Dogwood Southern Table open and Corkbuzz and Rusty Bucket to follow by June. The development also includes Charlotte's first Whole Foods and SunTrust's regional headquarters.

The "Perk Lounge"
Solis Sharon Square is the first Solis development in Charlotte. Terwilliger Pappas is building a second Solis Dilworth and a third Solis Waverly in southeast Charlotte, and just got rezoning approval for a fourth Solis in Ballantyne. The company is also building Solis developments throughout the Southeast, including in Raleigh, Durham and Atlanta.

Solis Sharon Square has leased 167 out of 239 units. Pappas said two-bedrooms have been especially strong. The Latham building is fully leased, and the Graham building is still leasing as workers finish the final common spaces.

"It's good, very good," said Pappas. A 1-bedroom starts at $1,615 a month, while a 2-bedroom starts at $1,985.

A model apartment in Solis
The upscale features at Solis Sharon Square offer a window into what the demographics Pappas is targeting (Millenials, executives and empty nesters) have in mind.
  • High-end common spaces: The apartment complex features spaces such as "Boost" (a fitness center with nice equipment), "Savor" (tricked out demo kitchen that will have cooking classes), the "Perk Lounge" (free Starbucks coffee, TV, tea) and "Break" (a room with a pool table, poker table and TVs).
  • Attention to finishes: From granite counters that have become standard in high-end apartments to higher-quality wood flooring and art in the hallways, Pappas said his company paid special attention to the details to create apartments that meet renters' expectations.
  • Outdoor gathering areas: Solis Sharon Square has a pool and outdoor decks featuring bocce ball and grills. The apartments also have a pet walk for dog owners to let their dogs go for a run.
  • The "Boost" fitness center
  • Working closely with surrounding businesses to create a real mixed-use experience: Pappas' thesis is that people are willing to pay a premium to rent places closer to their jobs with more amenities and a walkable lifestyle. To help create that lifestyle, the complex is working with businesses. For example, Whole Foods will deliver groceries to Solis residents if they buy more than $25 (which isn't a challenge every time I go to Whole Foods), and a cooking school will hold classes for residents in the demonstration kitchen.

Wednesday, January 28, 2015

Charlotte boom likely to continue, real estate panel says

Banktown is a boomtown these days. Apartments are sprouting everywhere, office tower construction is back uptown and rents are rising as people continue to flock to Charlotte. And a panel of experts said this week that they expect the growth to continue.

The eighth annual commercial real estate forum sponsored by accounting firm GreerWalker LLP and law firm Katten Muchin Rosenman LLP was held Monday at the Ritz-Carlton. The almost 500 attendees and the buoyant mood were themselves indicators of how well things are going right now - no more talk of cliffs and our falling off them.

"It's been really remarkable to watch how Charlotte has progressed," said DTZ chief economist Kevin Thorpe. "We're actually starting to see the local commercial real estate markets thrive."

Here are some of the panel's key points:

  • Eye opening chart of the night: This graphic totally surprised me. Charlotte's office absorption tracks the growth of travelers at Charlotte Douglas International Airport almost perfectly. Both likely reflect the health of the local economy and business travel.  
  • Apartments look like a bubble, but aren't yet: The panelists agreed that Charlotte is building a ton of apartments (all you have to do is look around on any drive in Charlotte and you're sure to see a few under construction). So is it a bubble? Thorpe said no. "Multifamily will overbuild briefly. Vacancy will hit 9 percent," said Thorpe. That's almost double the current rate. But with population growth estimates strong  - especially Millenial renters - there will soon be enough demand to tighten vacancy rates up quickly. "Most of those apartments will be rented," said Thorpe. The real question: What happens when all those Millenials (myself included!) hit prime home-buying age in five to seven years? That's when things could get interesting.
  • There's still plenty of unmet need for office space: Demand for office space has been growing in Charlotte faster than new deliveries for four straight years, Thorpe said. Vacancies have tightened up and rents have moved up. But Walker Collier III, a partner at Trinity Capital Advisors, said his firm doesn't have much of an appetite for spec offices. They're looking for an anchor tenant to kick off Trinity's planned 14-story tower at S. Tryon and Morehead streets. Collier also said his firm is looking for suburban office parks to invest in, which he said have been underbuilt in recent years as people flock to center city areas.
  • Charlotte needs way more industrial space than it has: "Charlotte is way under-building industrial right now," Thorpe told the audience. "Severely under-building." Rents for industrial space jumped 5.1 percent last year and could grow by double digits this year, Thorpe said. 

Tuesday, January 27, 2015

Still waiting on apartments on Kenilworth

When Forestar Group bought a prime parcel of land at Kenilworth Avenue and Morehead Street, the company demolished an old, vacant building that had become an eyesore to make room for a high-end mixed use development featuring 379 apartments and up to 25,000 square feet of retail.

But since that demolition and others nearby, the site has sat mostly quiet, fenced off and vacant. On the same block, Solis Dilworth and Crescent Dilworth have come out of the ground, with 196 and 296 units respectively. Both of those upscale complexes are set to be finished this year.

On Monday, I called Texas-based Forestar to see what the latest news is and whether the company has any more information on its project, or a timeline. Spokeswoman Anna Torma said Forestar doesn't have any updates at this time on when the company might move on the site.

A check of county building permits showed no permits have been pulled for most of the site since the demolitions. But one set of permits, for "Mega East Morehead Apartments," was issued in December for $1.9 million worth of work on the site.

Another complicating factor could be Forestar's corporate situation. The company is in the midst of a fight with an activist investor group seeking changes to the board, and recently announced it is "exploring strategic alternatives" for its oil and gas exploration business. That usually means a sale or breakup of the company - a pretty turbulent position for any corporation.

So where does all of this leave those Charlotte apartments? For now, on the drawing board. We'll follow up and keep track if that changes.

Thursday, January 22, 2015

Industrial building sold in SW Charlotte for $52 million

A major distribution center in southwest Charlotte has sold for just over $52 million, according to the seller and real estate records.

The 1.1-million square-foot Logistics Pointe facility had been vacant when Westmount Realty Capital purchased it in 2006. Winn-Dixie had used the buildings as a distribution center for its supermarkets before declaring bankruptcy. The facility sits on 66 acres of land on a rail spur off Tryon Street and south of I-485.

Westmount invested in modernizing the facilities and bringing in new tenants. The center, which includes refrigerated space and is served by rail, is now about 90 percent leased.

“As challenging as it was to lease space in the wake of the economic downturn, we are very pleased with the turnaround we have made with this property, bringing it up to a high quality, well-maintained institutional grade complex with strong credit tenancy and stable in-place cash flow,” said Westmount partner Steve Kanoff, in a statement.

The company sold the facilities to a joint venture of LRC Opportunity Fund and New York Life Real Estate Investors. New York Life also recently bought the 525 N. Tryon office tower uptown, along with local developer Grubb Properties.

Wednesday, January 21, 2015

One Solis, two Solis, three Solis, four: New apartments approved

Charlotte will soon get its fourth Solis-branded upscale apartment complex, with the approval Tuesday night of a rezoning request from developer Terwilliger Pappas.

The newest complex, Solis Ballantyne, will total 194 units at the corner of North Community House and Bryant Farms roads, along with 15,000 square feet of retail. This complex will join Solis Dilworth (corner of Kenilworth and Morehead streets), Solis Waverly (Providence Road south of I-485), and Solis Sharon Square (SouthPark, next to Whole Foods).

In all, Charlotte will soon have about 1,000 Solis units.This is in line with other upscale apartment developments being built this year around Charlotte, such as The Fountains (complexes in Matthews and Uptown) and Crescent (SouthPark and Dilworth).

City Council also approved a rezoning petition from developer Spectrum Properties that would allow the company to tear down a 48-year-old apartment complex on Abbey Place, just south of Park and Woodlawn roads. The current complex is 128 units; Spectrum plans to build 265 upscale apartments on the 9-acre site.

Council member John Autry, a Democrat, said the plan to tear down the less expensive existing units and build new apartments spotlights the issue of affordable housing. The new units will be 1- and 2-bedroom apartments renting for $1,100 to $1,300 a month.

"It puts a magnifier and a hot light on the disparities we have in this community," said Autry, who voted for the petition. Council approved Spectrum's request unanimously.

Tuesday, January 20, 2015

Cotswold Publix, and other rezoning decisions Tuesday

Charlotte City Council is set to hear rezoning petitions Tuesday night. If rezoning were a chore, it would probably be something like brushing your teeth - vital to do, but not exactly the most exciting thing in the world. Still, rezoning can arouse some strong passions (Anybody remember the Dilworth Walgreens Battle of 2012?).

Here's a look at what's on the agenda Tuesday night:
  • New Publix in Cotswold: This is probably the most interesting petition up for a vote Tuesday. Cotswold Partners LLC is hoping to rezone a 2.2-acre site near Randolph and Greenwich roads from neighborhood business to mixed-use development. The developer would demolish the existing office building and construct a new Publix grocery store (see part of the rendering below). This would be an aggressive move - the site is directly across from a large Harris Teeter - but Publix has been upfront about challenging Harris Teeter. Neighbors have expressed concerns about increased traffic, but staff recommend the petition for approval. 
  • A Terwilliger Pappas apartment complex, Solis Ballantyne, has garnered a protest petition, but staff recommends approval. The complex, on 10 acres of vacant land at the corner of North Community House and Bryant Farms roads, would have 194 units and up to 15,000 square feet of retail space. Terwilliger Pappas is building other Solis-brand upscale apartments in Charlotte, such as the Solis Dilworth complex under construction at Kenilworth and Morehead streets.
  • A developer is trying to rezone 1.2 acres at Woodlawn Road and Montford Drive to allow an 8-unit apartment building on the site. With one bedroom units estimated to rent at $1,050 a month, the units are targeted at young professionals. The plan has picked up a protest petition from the neighborhood. It's up for a hearing, not a vote, on Tuesday.
    Proposed apartment building
  • There's a proposal in Plaza Midwood to rezone the land of the historic Vanlandingham Estate on The Plaza. The rezoning petition would allow the construction of up to 19 single-family attached houses for sale around the perimeter of the historic property, along with a private pool and spa. The main estate would still be used as a hotel and small conference center. The townhouses would be $340,000 to $420,000. The rezoning is being sought because the Vanlandingham Estate isn't sustainable in its current form, one of the developers said at a community meeting. Staff is not recommending approval of the plan as is, because the increased density, parking issues and inward-facing orientation of the townhouses are inconsistent with the neighborhood. This is also up for a hearing, not a vote.
    Rendering of the proposed townhouses

Wednesday, January 14, 2015

Construction underway on 670-acre Belmont development

Construction has begun on a 670-acre development in Belmont, adjacent to Daniel Stowe Botanical Garden, the company behind the project said Wednesday.

The master-planned McLean development will cover miles of Lake Wylie shoreline, and will include a marina, a public park and commercial development. Plans call for it to have just over 800 homes.

The master plan for McLean
“This is a special piece of property with an incredible legacy and breadth of natural amenities including its shoreline, access to the lake, trail system and scenic landscape. There is nothing else like it on Lake Wylie,” said Steven Hinshaw, principal of developer NW Lake Wylie LLC. The company is affiliated with Northwood Investors, a privately held investment firm with $4 billion of assets under management. “Our intent is to develop it in a manner respectful of its beauty, creating neighborhoods and homes fitting to this environment.”

The property has been re-zoned and annexed into Belmont since Northwood purchased it in August 2013. The developer is refurbishing the historic McLean family home on the property and will open it as a sales and information center in the spring. The specific custom and neighborhood homebuilders will be announced later this year.

Tuesday, January 13, 2015

Update: Faison buys 511 Queens Rd. property for apartments

Developer Faison has purchased a vacant 1.4 acre parcel at 511 Queens Road, Mecklenburg County property records show, and the land could soon see a six-story building with 62 apartments.

A deed filed Dec. 30 shows a Faison-affiliated corporation purchased the land from Five-Eleven Partners for $3 million. The property is next to Theatre Charlotte, and had been originally slated for a condo development before the economy crashed.

Update: Kris Fetter, Faison's managing director of construction and residential development, said the company's plans are still in the design phase. There's no timeline yet for construction on the site, Fetter said.

Rush Dunaway, a broker with Sperry Van Ness Percival Partners, represented the seller, a Columbia-based company. He said the land is zoned for up to 62 residential units, and Faison could build a six-story structure (including one story of underground parking).

Dense, infill development is making a comeback after the recession, Dunaway said.

"It dried up for about eight years," Dunaway said. "It's back now."

Charlotte-based Faison is a major apartment developer, and from 2012 to 2014 the company developed about 2,000 apartment units throughout the Southeast. Last year, Faison divested two of its business lines - spinning off its advisory business and selling its property management division - to focus more on investing its own capital.

"Today, Faison is focused on investments for its own account and multifamily developments utilizing the entrepreneurial spirit of its founder" Henry J. Faison, the company says in its self-description.

(Hat tip to the guys at Urban Planet for spotting this first!)