urbanSTL

IMO our cynicism is well-earned in St. Louis, but supporting local companies in expansion and relocating to modern office space isn't a zero-sum game. Downtown desperately needs new Class A office space.

Alex Ihnen wrote:IMO our cynicism is well-earned in St. Louis, but supporting local companies in expansion and relocating to modern office space isn't a zero-sum game. Downtown desperately needs new Class A office space.

I agree 100%.

For other cities, however, I just don't hear the same level of cynicism. There may be some cynicism for other faster-growing cities, but the cynicism and timid approach to development in St. Louis can be excruciating.

This project, I think, has the ability to spur more new development in downtown St. Louis.

Last, my question is.....How was Koman Group able to do this, but we are waiting on the real BPV to emerge from the ground still?

Honestly, my support for The Cardinals isn't as great as it used to be and a big factor has been because they have duped St. Louis and Missouri in regards to the scale of BPV.

If Koman puts this together, it will demonstrate how badly Bill The Third needs surrender development rights to some other developer.

A small 120,000 new Class A office building won't hurt downtown, in my opinion.

There is no real glut of Class A office in downtown St. Louis. The glut seems to be Class B and C - buildings that need to be converted into new uses or demolished - like those ugly suburbanish buildings near the convention center.

Unless they get updates, many of the existing Class A buildings are really on the verge of being Class B because they are older than Methuselah.

If downtown doesn't get more new Class A buildings, the risk of firms moving from downtown increases.

I personally think this building will help test the waters.

bprop wrote:Is One AT&T Center considered class A? If so, we'll soon have 1.4 million square feet to quench the desperate need for office space...all without dropping a dime.

Someone much smarter than I can chime in here, but I don't believe it is technically on the market at the moment. If memory serves right, it was purchased from an out of state owner and the ATT lease technically isn't up yet. I'm sure it will become more marketable once that lease is over and they can start trying to draw in new tenants or potential new uses.

St. Louis City needs to make it happen.

Incentivizing higher than normal for this project is okay, in my opinion.

This is a very small NEW building - the first in nearly 30 years - to be proposed for downtown.

This building is unique in that it is the first new proposal for downtown in DECADES.

It wouldn't hurt the city to incentivize it some to help it along.

But yes, I agree, it is a gamble.

While I understand the concerns some people may have - nothing ventured nothing gained.

No other developer (not even the Cardinals/Cordish) has come to the table with firm plans for a new downtown commercial building IN NEARLY THIRTY YEARS. Come on. Koman is a proven local developer.

And if Koman doesn't want to take all of the risk.... I understand. I understand why Koman wants the city to share in the risk. It's the first new commercial building in downtown in nearly THIRTY YEARS. I can't stress that enough.

I say give Koman what they want or close to it. They are the absolute FIRST willing to take the risk. Just because Koman gets a major break for this project, it doesn't mean Koman or other developers must get the same deal/incentives in the future.

Also, St. Louis Public Schools wouldn't be put in a "strain" because of incentives given to this puny $44-million building. The tax bases in the City of St. Louis are growing. Property values are up. Retail sales are up. Earning taxes remain steady.

Further, shifting 300 employees from one building to a new one insures those 300 will stay downtown with the possibility of nearly 300 NEW jobs being added. Apparently, this unknown firm is wanting (or is very interested) in a new modern Class A building or it could be leverage they are using in order to get a better lease rate at their current building. Regardless, we don't want them leaving downtown because of poor Class A choices/options.

Met Square is old. Tenants have been pouring out of Met Square. Although Bi-State moved in recently, HOK, KAI etc. etc. have moved out of the building into new digs downtown and elsewhere. LaClede left its old tower for a reno. The switcheroo of companies goes on in every market - including Clayton.

At the end of the day, as I see it, this building could be a catalyst for residual development in this part of downtown.

I'm hopeful that things would balance out in the long run.

andrewarkills wrote:I pulled this from the city's annual budgets from 2000, 2010, and 2014. While taxes have grown, keep in mind the mix has remained steady. If you're foregoing property tax to stoke growth in other tax bases, one would expect that mix to move, even if just slightly.

Cool graph. Where's 2015 and the link source?

andrewarkills wrote:Keep in mind that during that same time period the city & state "invested" quite a bit during those 14 yrs through a combination of foregoing property tax revenue, and issuing TIFs & municipal bonds, and using different tax credits. To the tune of $5.8 billion. To the point that we've ventured nothing, 57.91% of that investment was in 2 neighborhoods, Downtown and Downtown West.

The argument can be made that we've actually invested quite a bit, and have relatively little to show for it.

Absolutely depends on one's perspective. But I think the notion of, "relatively little to show for it", is a hella-major exaggeration.

I saw downtown in the mid-to-late 90's look like "Escape From New York". Tumbleweeds were literally rolling down Washington Avenue. Buildings were boarded up and covered in soot. They reeked of rot and mold. Downtown was moribund as hell.

I submit that greater downtown needed that much investment because St. Louisans - urban and suburban - allowed downtown to decay for far too long. Trust me, now there's a lot to show for the investments made in downtown over the years. LOTS. Downtown would be DEAD as a doorknob without those investments. It isn't perfect, but the investments continue; which is good.

Greater Downtown is truly the region's front door and it - along with downtown East St. Louis - should be a priority for everyone in the region. The results of investments made in downtown St. Louis over the last 15-20 years have not been futile "or relatively little" by any stretch of the imagination, in my opinion. With that said, I admit, there have been some challenges along the way - AT&T layoffs, government relocations, downsizings, losses and acquisitions of local corporations, moves to the suburbs by firms, loss of retail etc. Some of the challenges were beyond the city's control.

Sadly, however, I consider some of the challenges experienced by downtown St. Louis to be a regional cultural issue. Nonetheless, downtown would be DEAD without that infusion of investment.

Also, based on your posted percentage, that means 42.09% was invested in the other neighborhoods scattered throughout the city. While there is still a lot of work to do throughout the city, contrary to what some may believe, St. Louis is looking better (more attractive) and appealing than it has looked in a long time.

andrewarkills wrote:Incentives thrown around without a targeted and cohesive strategy are.

Nonsense. No incentive, TIF or otherwise, is ever given without a "targeted and cohesive" strategy. There are government boards that vote on approval of these incentives. But boards and governments have been debating, issuing, tweaking then re-tweaking what constitute legit and impactful incentives for decades. There are no foolproof magic incentive bullets in any city. Chicago has debated them. Atlanta has debated them. Houston, Dallas and others too.

But I do agree that discussion and refinement never hurts - until discussion and refinement are needed again. What's smart from one perspective might not be for another. There are always going to be unhappy people when it comes to the way administering government incentives are handled. They are like taxes. Nobody wants to pay them, but nothing gets done without them.

andrewarkills wrote:We've been throwing everything at the wall for 20 yrs now, hoping it sticks. I would like to see us be a little bit smarter about it. Cannibalizing office space leases from other property downtown doesn't feel smart, unless there are concrete promises from the developer (and claw backs for the City if not delivered on) to hit certain job and tax revenue targets.

Again, what's smart? There just isn't a surefire way to administer incentives.

Further, I submit that's a layman's perspective. Prudent as that perspective seems, from a business or developer perspective - if a corporation or firm is ready to leave its existing building/lease for newly-proposed digs - that corporation or firm is not considering whether they are leaving a glut or is "cannabalizing" office spaces from other properties. They couldn't care less. They want modern digs. For property owners and developers, it's dog eat dog and if a city doesn't want to lose 600 jobs to the suburbs or another city, you have to find a way to make it work. If not, then you could lose everything.

FYI, Houston and Dallas - even Cincinnati - have had new buildings rising while multiple 30-to-40 story buildings were either empty or grossly under-leased. Apparently, it seems there have not been worries of "cannibalizing" in those cities - at least not to extent you have in St. Louis.

andrewarkills wrote:There are ways to incentivize this in a smart way that works for everyone, not just the developer.

I agree 100%. Now people and firms like McKee's McEagle are abusive. I get that. Some developers are greedy and don't consistently produce or deliver on their promises.

But Koman doesn't have such a history. They deliver.

No rocket science needed.