Years ago, after listening to the latest idea for revitalizing downtown, former Beale Street developer John Elkington facetiously said Memphis is always chasing the latest trend, but “usually, it’s 10 years after everyone else.”
Back then, his comment was met with knowing laughter, but maybe, just maybe, Memphis is closing the gap.
ServiceMaster is the latest in a national trend in recent years of Fortune 1000 companies leaving their suburban headquarters to relocate downtown, but it is the first of its kind in Memphis. In Chicago alone, AT&T, Motorola, Sara Lee, Walgreens, United Airlines, and Archer Daniels Midland have moved. In Seattle, Expedia is spending $229 million to adapt existing buildings for its new downtown waterfront headquarters.
The locations for corporate headquarters used to be decided by where the CEO wanted to live, but more and more, these decisions are being guided by where the most desirable workers want to live — college-educated 25- to 34-year-olds. Research shows that jobs follow people; the most mobile, coveted workers are younger ones, and today they want to live in an urban environment.
Connecting The Dots
In other words, companies are simply following the talent, because these 25- to 34-year-olds have a strong preference for living within three miles of the central business district. In fact, 51 percent have this preference, compared to just 12 percent in 1990. ServiceMaster, like other companies that need to attract younger workers, is placing bets that a Downtown headquarters will be a magnet for them.
This trend in urban living is paying big dividends in other cities, and there is anecdotal evidence that Memphis is catching up. Then again, when compared to other cities, the percentage of college-educated 25- to 34-year-olds is diminished by the fact that a three-mile circle around downtown Memphis takes in thousands of acres of Arkansas fields.
More than anything, the ServiceMaster announcement moved all the talk about a Downtown renaissance from hyperbole and closer to reality. Before Servicemaster even opens, the Harahan Bridge’s pedestrian walkway was completed; the Tennessee Brewery, Chisca Hotel, and Union Station, against all odds, are being transformed, and plans for the Pinch Historic District revitalization are getting under way.
When ServiceMaster’s 1,200 workers and St. Jude Children’s Research Hospital’s 2,000 new employees come online, downtown employment will climb 10 percent. Together, they reverse a 15-year trend that dramatically reduced the number of workers downtown as major employers moved eastward.
Plan To Action
And yet, downtown’s cupboard isn’t bare. It is home to the state’s largest creative agency at Archer Malmo; the state’s largest law firm, Baker Donelson; the state’s largest bank, First Tennessee; and downtown’s other Fortune 500 company, AutoZone.
Much of downtown’s momentum has been bicoastal — South Main’s $500 million building boom on the south and Bass Pro Shops’ 3 million visitors on the north — but ServiceMaster is a huge boost for the core, and its announcement that its headquarters will include a technology and startup center is right on message for the emerging creative district plans for the area.
Often, local government and public agencies take a laissez-faire attitude toward downtown’s major investments and marquee projects. The openings are celebrated, but then nothing is done to leverage them by connecting them and the lack of programming fails to deliver the vibrancy that characterize successful downtowns. For example, although there are millions of people visiting the outdoor wonderland at The Pyramid, with no trolleys on the tracks at its doorstep and no marketing plan aimed at them, Bass Pro customers often drive, park, shop, and leave without learning more about what to do downtown.
The Promise
Today, with so many new assets that downtown did not have only five years ago and with the promise that the next five years will be transformative, the priority should be to activate downtown to such a degree that it turns the corner once and for all, and sends the message that people and companies should get on board now or miss out on the most exciting times in its recent history.
ServiceMaster will be the third largest private employer in downtown, but the importance of its decision extends far beyond the number of jobs. Only a few months ago, there were long odds against the company staying in Memphis, and if it had chosen Atlanta or Dallas, the damage to Memphis’ civic psyche and its national brand would have been devastating.
ServiceMaster has made its decision, and now it’s up to the powers-that-be to decide to deliver the energetic, vibrant, and active downtown that ushers in that new urban era for our city.
Downtown is still just pretty much dead. So little street activity even at lunch hour. Especially the north end by the government offices. Bass Pro Shop is cut off by highways. The sight of the hulking empty and boarded up Sterick and 100 North Main St is depressing and makes it look even more empty and blighted. And no trolleys! MATA is horrible! How can downtown get any worse? We have only one way to go. Up. Yes, Memphis is always 10 years (or more) behind other cities.
It’s a sure bet that Amazon won’t be relocating to Memphis but downtown certainly has a lot of parking lots and vacant lots for something.
How could it get any worse? You could have an empty Pyramid, empty Peabody Place, empty Chisca, Tennessee Brewery still rotting etc etc. Granted yes the Sterick and 100 N Main need to be addressed but comparing downtown to 5 years ago you’d have to be ignoring progress to say it’s not getting better. Yes, I hope the trolleys are running again soon and smaller things like that but it’s definitely improving. Along with Servicemaster, Wunderlich moving to One Commerce, the redevelopment of the Hickman Building, Wonder Bread Building and many other things are happening in different pockets that should have some ripple effect.
Thanks, Dan. Context matters. We’re not there yet but we’re far better off than we were only a few years. ago.
I do wish we had more going on downtown. Finally the Chisca got renovated, but it was definitely done on the cheap. I was in one of the rentals there and it’s nothing spectacular and will not age well as a structure. Thankfully the Peabody Place found a use but a new office tower would be better. I doubt One Beale St will ever happen because it’s been “planned” for 10 years or more and nothing has happened. Doubt enough tenants can be found for it.
I have worked downtown for the last 10 years. I had worked downtown previously in the late 90’s. The difference is amazing. I notice the emerging development every day traveling to and from work. We are headed in the right direction. I am excited about downtown, the medical district and, of course, midtown where I live!!
Thrilled to work downtown with many creative professionals as our neighbors. Love being able to enjoy Main St and the riverfront over lunch and talking to the people who are out and about, enjoying the scenery. My colleagues and I and other friends who work downtown are all thrilled by the changing scenery down here. It’s a marked difference from how things were when I joined this company 11 years ago. We definitely can feel the revitalization energy in the air and it’s an exciting thing to be a part of. Here’s hoping the trend continues.
PS – I’ve generally found that the naysayers who complain about downtown being vacant, dirty and dangerous rarely even come down here.
Central station, Tennessee Brewery, Old dominic’s Distillery, Bass Pro at the Pyramid, St Jude expansion, Chisca Plaza, Hickman Building, Service Master, Artspace Apartments, Patterson Place apartments, Uptown Flats, 266 S. Front apartments, Napoleon Hotel, LaQuinta Inn, Hilton Garden Inn, The big river crossing and the Trolleys coming back have me excited for the future of downtown. There are other projects coming also, including the Cook Convention Center and the cobblestones renovations.
Does anyone know status of One Beale?
One Beale is still the big pipe dream of the Carlisle family. Chase Carlisle was the lead on this but has left that role.
There is currently no need in Memphis for a modern office bldg without a big tenant lined up. The pipeline is dry. The apt-condo part also has little demand for luxury living. The appetite for development in Memphis has been very skittish since the debacle of the Horizon Condo that is now renamed Artesian. This one is so architecturally ugly and resembles the failed hotels in Tunica.
One Beale will remain just another empty lot for the foreseeable future.
There is little development in all of greater Memphis when you compare us to the tremendous growth and big projects that are transforming other cities like Austin, Denver, Atlanta, Dallas and Nashville.
It’d be nice if one of FedEx’s Op Co’s moved downtown. Not all of them are in the various campuses and could be relocated.
I think one of the problems with development downtown (and I say this as a downtown resident) is we need more population in the central city. I look at the empty lots downtown, and not to mention north and south memphis, and am baffled that we’re still building on greenfield sites in places like Arlington and Collierville (not to mention Hickory Withe). I’m an optimist, not a naysayer, and see the city, not the exurbs as the way forward; however, we presently have many developers who only know how to make a dollar on a greenfield site. We need to encourage urban infill. Since we implicitly subsidize suburban sprawl, perhaps we should explicitly subsidize urban infill with property tax discounts if you decide to build a new home on an empty urban lot. Maybe give property tax credits for subdividing lots and building townhomes, we should think creatively.
The point here is this: Hang on to the good, because it is here and it is real. Thank you to all of you that see Memphis in the positive.
The Mayor and Memphis city government absolutely MUST do something about the two biggest blighted structures in this city namely 100 N Main and Sterick Bldg.
These buildings are huge eyesores, blight, ugly, depressing stains on Memphis. Boarding up the street level of 100 N Main with “art” scrawled on plywood is not good for the city’s soul and psyche. Someone is going to get hurt with these unmaintained buildings and there have already been fires in both. I know they are still privately owned but they need to be torn down because they are both beyond reasonable repairs.
They both really harm downtown, especially the north end of it looking more like old tombstones than part of the skyline
Totally agree RWA.
Does anyone have insight as to what is getting done about this?
With all the positives mentioned here, it would be only right to put the issue of blighted properties front and center. 100 N Main and Sterrick must be addressed.
I don’t know how many news stories I’ve seen about a new owner for 100 N Main being delayed etc. If something isn’t settled soon I’d say just tear it down, we don’t need another Sterick haunting the skyline for 30 years. I do however wish something could be done with the Sterick, incredible building. I know the expense and land/lease situation makes that almost impossible but with Crosstown and all the other rehabs lately hopefully someone could pull something off.
Both Sterick and 100 N Main are far beyond repair. It would be much too expensive to contemplate any reuse and new tenants are not lining up for them. Too much empty space downtown already.
Sterick in particular is rapidly deteriorating. 100 N Main also has deteriorating conditions and tons of asbestos. The best solution is to demolish both ASAP. They really are huge hulking blights for the city. I know of no other American city with such tall buildings in a downtown area in such bad condition. Not even Detroit..
The mayor and city really need to take action immediately to start the process. These structures are very embarrassing for the city.
My question is, what’s stopping city powers from doing just that? Why have they allowed this to go on for so long?
Totally unacceptable…
Why is the commercial appeal so enthralled with providing negative news about the city? It’s one thing to report crime that happens but the other stuff accomplishes nothing but make it harder for the city to rebound.
Agree 100%.
Irwin and 38103: What articles are you specifically thinking of? Today’s ranking of worst cities and the big coverage given to the millennial who gave up on Memphis?
The usual rankings and the article on income increase/poverty increase.
I hear you. These rankings mean nothing. Change a factor or two and it shakes up the whole list.
Did you notice that the headline yesterday said: Help wanted: These 25 cities are tops for jobs – rather than Memphis ranks #6 in best cities to find a job. If you are going to highlight a ranking that reflects poorly on Memphis, give the same attention to one that is positive.
You might want to join Facebook group: Gannett Screws the News. https://www.facebook.com/groups/136791200228851/
Unfortunately the CA is the only newspaper in town. It’s typically bad Gannett journalism and largely edited in Nashville. It has little local influence these days and zero investigative stories.
Today’s edition of the CA does have a very important local story:
“Memphis-area incomes up, but so is poverty, census estimates show”.
The percentage of residents in the nine-county Memphis area living below the poverty level rose from 18.4 to 19.4. Memphis has the highest poverty rate of any metro area in the nation populated by at least one million people.
Across Tennessee, Nashville was the only metro area whose median income ($60,030) topped the national figure ($58,617). Nashville had the lowest metro area poverty rate in Tennessee at 11.6%. The poverty rate in the Memphis metro area was 19.4%.
Lived in Nashville. Don’t know exact statistics, but a lot of jobs are construction due to the building boom. What happens when boom is over? I’m not an expert, but it’s worth considering regarding median income.
Poverty and high crime are the most significant barriers to development in Memphis. Until progress is made on those problems we will continue to struggle as a city and region.
38103. What in the world would bring someone from Nashville to move here? Like everyone I know in Memphis I’d give anything to relocate to Nashville.
Who’s keeping you? You are a drag on Memphis.
Research shows that the majority of millenials want the same things they grew up with…open space, great neighborhoods, quality schools, safety and security, and for many, that means the suburbs. While the 18-26 Mill might prefer the 700 sf urban dwelling, once married with junior on the way, the 26 – 35 year old Mill, life outside of the urban setting becomes more appealing.
Well Researched: Two things we’d say in response –
1) Downtown has a higher percentage of 25-34 year-olds that Memphis and Shelby County as a whole
2) From Joe Cortright of City Observatory who pioneered research on 25-34 year-olds:
The Young and Restless—25 to 34 year-olds with a bachelor’s degree or higher level of education—are increasingly moving to the close-in neighborhoods of the nation’s large metropolitan areas. This migration is fueling economic growth and urban revitalization.
Using data from the recently released American Community Survey, this report examines population change in the 51 metropolitan areas with 1 million or more population, and focuses on the change in population in close-in neighborhoods, those places within 3 miles of the center of each metropolitan area’s primary central business district.
Urban cores attracted increased numbers of young adults even in metropolitan areas that were losing population and hemorrhaging talented young workers. Metropolitan Buffalo, Cleveland, New Orleans and Pittsburgh, all of which experienced population declines over the past decade, saw an increase in the number of young adults with a college degree in their close-in neighborhoods. (In these cases, the numerical increases were from small bases, but show that the urban core is attractive even in these economically troubled regions).
Overall these close-in neighborhoods have higher levels of educational attainment among their young adult population than the overall metropolitan areas of which they are a part. The college attainment rate of young adults living in close-in neighborhoods in the largest metropolitan areas increased to 55 percent from 43 percent in 2000. Outside the three-mile urban core, educational attainment rates increased slightly from about 31 percent to about 35 percent.
http://cityobservatory.org/ynr/
Thanks…back at ya…Konrad Sopielnikow’s “2016 Home Buyer & Seller Generational Trends”, “Millennials Actually Like the Suburbs”, Tierney Plumb, from the LA Times, Phillip Molnar reports, “Millennials Want Houses in the Suburbs After All, New Study Finds”…and the list goes on, and on…while many Mill’s certainly gravitate towards the urban dwelling, studies suggest that we should not take the Mills presence in the urban core as their preference for the urban core. There are two sides to this narrative and many reports I have seen say the Millennial urban core pref is a false narrative.
Thanks, WR. We’ve worked with Cortright and his work has been funded by Knight Foundation and Kresge Foundation so we have a high level of confidence with his analysis. Also, he’s ripped up the methodology used by some of these studies, but thanks for the sources to read.
According to Marcus & Millichap, using US Census Bureau data and M&M research services, 2016 – 2021 expected 20-34 yr old migration, 0.6% to suburbs, 0.7% away from downtown. 2000-10, downtown outpaced the burbs, 10-16, even, new data suggests a shift out. Google John Chang with Marcus & Millichap.
Thanks for citation. We’ll check with Joe Cortright about any updated that leads him to agree.
It is interesting that there is evidence that millennials moving to suburbs are still looking for an urban style life.