By KERRY SMITH, EDITOR, ST. LOUIS CONSTRUCTION NEWS AND REVIEW MAGAZINE
As the level of commercial development continues to rebound across St. Louis, long-separate districts are growing into each other, leaving long-stagnant pockets of empty structures behind.
This message came from Tom Ray, first vice president with CBRE, during Mueller Prost CPAs + Business Advisors’ “Foundations for Success – What to Expect in Real Estate and Construction in 2019” program Jan. 23 at Brennan’s Work & Leisure in Midtown.
“The development dead zone that long existed between Downtown St. Louis and the Central West End is filling up, thanks to developments such as Cortex,” said Ray. “In terms of development – both new construction and rehabs – Clayton is bleeding into Midtown and Midtown is connecting with Downtown. It’s an exciting time to be in commercial real estate development, design and construction in St. Louis.”
The very site of Thursday’s forecast event exemplifies this development trend, according to Ray. Brennan’s Work and Leisure – a new event venue and co-work space in Midtown at 30th and Locust – is situated in an area that five years ago stood dormant. Today, it’s bustling with creative agencies, eateries and the planned Jefferson Connector, evidence of the fact that a surge in Midtown redevelopment is connecting Midtown with Downtown.
“The construction of the One Hundred – a 36-story, contemporary, upscale apartment tower in the Central West End (on North Kingshighway), is further evidence of development of this visual and developmental connection between districts,” Ray said. “This luxury living tower sports a Clayton look yet is located within the CWE,” Ray said. “We are seeing the beginnings of true interconnectivity between Clayton, Midtown and Downtown St. Louis.”
“Granular” development – that which is occurring in the rehabs of buildings spanning less than 15,000 square feet – is typically costlier to do on a per-square-foot basis than is larger construction, Ray said, due to the lack of economies of scale and structural/environmental challenges inherent in St. Louis’ century-old, urban inventory. “In many ways, new construction is easier to accomplish,” he said, “so it’s really encouraging to see these granular projects taking place.”
As viewed through the lens of real estate development and construction, St. Louis’ central corridor is truly an active, working corridor, according to Ray. “The level of granular development that we continue to see in St. Louis is exactly what we need,” he said, referring to the repurposing of longstanding empty urban buildings into office real estate and mixed-use, live-work spaces. “What’s happening is that the three districts (Midtown, Downtown and Clayton) are connecting into one true central corridor.”
Another trend is contributing to lower commercial vacancy rates across the city, said Ray, and that’s a retail and hospitality shift from marketing goods and services to marketing user experiences. Developments such as the $187 million Union Station redo to the multi-phased, $200 million-plus City Foundry StL within Cortex – including Class A office, retail, restaurants and entertainment – further illustrate how St. Louis’ separate districts are connecting together.
