Vision for greatness ahead for St. Louis

St. Louis commercial real estate should be headed for great things in 2021, judging by insights provided in “Greater St. Louis and a Vision for Greatness,” a March 9 Retail Spotlight Shift webinar from the St. Louis CCIM chapter.

Tiffany Wiegers, 2021 president of CCIM STL, kicked off the event by thanking sponsors as critical to providing services and resources for the chapter and announcing that scholarships are available for upcoming courses (details are on the CCIM STL website).

Events hosts were Tony Kennedy of Colliers International and Tom Ray of CBRE.

“This is a timely and important discussion about the future of our region,” said Greater St. Louis, Inc. founder and CEO Jason R. Hall, in describing Greater St. Louis Inc. as a combination of five organizations (AllianceSTL, Arch to Park, Civic Progress, Downtown STL, Inc. and the St. Louis Regional Chamber) aiming to reduce historic fragmentation and create one united voice.

“We have to make a decision that we will be a community on the rise or on the decline. We need the same vision, same tenacity, same energy (as in the sports sector) to grow the region.”

“Greater St. Louis brought together eight key growth initiatives from day 1 (January 1, 2021),” Hall said. “It’s all about jobs — retain, attract and create; elevate our regional reputation; and advance common goals. The urban core is essential.”

Among the positive indicators,  St. Louis has seen $8 million in commercial real estate during the pandemic.

“And that has continued to grow. St. Louis can be a global leader in biotech and agtech,” Hall said.

An important example is the 1,400 new jobs coming with Accenture. Other encouraging signs are redevelopment of the Butler Building, which has been one of downtown’s largest vacant buildings, and Green Street Workforce Housing, a partnership for “one of the largest inclusive housing projects in The Grove.

Such place-making projects have a huge impact on bringing business and residential growth to St. Louis.

“We are coming together as a geospatial center of excellence, with a long-term plan in place,” Hall added.

Hall cited entrepreneurship as another incredible force in being re-energized.

“St. Louis is launching new businesses and is first in the country for women-owned businesses,” he said. “We are aggressively back in business.”

Hall quoted Entrepreneur magazine as recently saying that “St. Louis is on the precipice of leading the United States in 21st-century innovation.”

While the St. Louis area hasn’t had a basic jobs plan for more than a decade, “we are now the only metro area to develop one in terms of the pandemic and the new civil rights movement,” Hall said.

“We have to drive inclusive growth. We have got to focus on inclusive growth and close spatial and racial gaps.”

Greater St. Louis is funded by private sector business as investors, and “the business community has to be much more engaged to make (our vision) a reality,” Hall noted.

“We have to make St. Louis better overall and understand the perception of St. Louis in the country. We started STLMade as a way to shine a light on the positive and tell our own story. We will take the story national. It’s a people-centered, data-driven approach.” 

In line with such efforts, the AllianceSTL partnership aims to “accelerate growth by recruiting new jobs and business investments to the 15-county bistate St. Louis region,” according to Chief Business Attraction Officer and president Steven S. Johnson.

“We have an exclusive external focus on business and economic development,” he said. “Our key audiences are site selectors, real estate developers and companies in our main targeted verticals: manufacturing and production; financial and information services; bioscience and health technology; geospatial; agtech; transportation and logistics; and the aerospace, automotive and defense industries.”

Many of those targets are in local commercial real estate because of their current work in location services, Johnson noted.

The Alliance is using social media and related advertising along with traditional advertising to those primary key audiences, along with individual outreach and relationship-building. Marketing is essential — a lesson that St. Louis is learning from cities like Austin, Texas. “Many of the markets we admire have been marketing business attraction for decades.”

Typical projects for the Alliance include “straight-up business development to attract companies and headquarters to St. Louis,” which represents 80% of its focus. Such companies are generally new to the area or have no St. Louis presence yet. Cooperation is vital: “We work with economic development partners; we can do nothing by ourselves,” Johnson said.  “Our relationships and partnerships are as strong now as ever, and that is good for St. Louis.”

To build on those connections, “we ask businesses exactly what they’re look for.” The answer is usually “talent availability and sourcing, business continuity, and the cost of labor. “We are finding that location is as much about mitigating risk as anything else,” Johnson said.

Agriculture technology is another important business sector for St. Louis, thanks to its central location and accessibility to a huge resource of agricultural producers, according to Thad Simons, founder and managing director of The Yield and The Yield Lab Institute, a “cooperative network of venture funds to advance food and agriculture technology globally,” with companies in Ireland, Argentina, Brazil, Chile, Singapore, France and Luxembourg.  The lab is the company’s nonprofit arm.

When he came to St. Louis in 2014 for a three-year assignment with Monsanto, “I was curious about the agtech space,” Simons recalled. “I realized the difficulty of getting projects off the ground. Part of the problem was understanding what ‘agtech’ means.”

With agriculture as one of the largest elements of the geospatial sector, the advantage for St. Louis is that it is “right in the center of agricultural production and distribution. The strength we bring is less the money that the connections,” Simons said. “The impact of the agriculture sector on St. Louis is tremendous.”

While many large organizations already have a local presence — the largest associations for farmers are all based in St. Louis, “we mentor smaller companies to come to St. Louis.” There is still a need to “find champions of St. Louis and stay in touch with them,” Simons said. He is encouraged by the expectation that “there will be lots of stories of companies coming here through word of mouth.”

Simons sees St. Louis as a “really hot space” that is “fostering research and technology.” Of the company’s 50 global projects, 12 are in St. Louis. Driving new investment and presence in the area are projects and innovations that go beyond traditional uses of agricultural products, such as a commercially viable indoor farm and “a small-scale project along Delmar to address food deserts” (the absence of grocery stores). “It’s intended to be for-profit, so we will sell products to restaurants, but also donate to the community,” he said.

Now getting started in St. Louis is a NASA Challenge to investigate “how growing food in space can relate to growing food on Earth,” Simons added.

While Simons is optimistic about business growth, he sees a need for expanded investment. “St. Louis is strong and getting stronger in human capital, but still not where we should be in financial capital,” he said. 

The hemp industry offers the prospect of growth as an alternative protein and in oils and nutrition, once regulation and legality are in place.

Looking ahead

For St. Louis business and commercial real estate to succeed, it is crucial “to be thinking five, 10, 20 years ahead to create self-perpetuating environment in geospatial and build up an innovation ecosystem,” said Hall. “That will give St. Louis a durable advantage.”

Asked about the impact of a new mayor on commercial real estate and business, Hall said the upcoming mayoral election is a “generational change; both candidates are speaking about growth  and the need for inclusional growth. It’s an exciting time for St. Louis. Magic happens when we have public and private alignment. There will be exciting opportunities to work together.”

“We seem to have two candidates who will be very hands-on and pro-development. We will work with everybody,” Johnson said.

“Whoever becomes mayor will have to realize that there is an urban-rural divide, and a need for much better understanding between those segments of the region,” Simons said.

A recording of the event is available at https://www.linkedin.com/company/ccim-st-louis-metro-chapter/ or

https://www.youtube.com/channel/UCO2uJM-RnLRetiKTNvYAUVA.

Collaborative action key to city vacancy concerns

Last week ULI St. Louis hosted “Starting Where You Are: Collaborative Planning Around Vacancy in the City, “ a virtual presentation moderated by Cecilia Dvorak, AICP, city planning executive with the City of St. Louis.

Presenters included Laura Ginn, vacancy strategist for the City of St. Louis; Bob Lewis, assistant professor of urban planning at Saint Louis University; and Sundy Whiteside, board president of the St. Louis Association of Community Organizations.

The program began with a few relative stats. First: Vacant property in St. Louis adds up to approximately 2,500 acres, 7,000 buildings and 13,000 empty lots.

Second: St. Louis ranks third in the United States for city vacancy. If a line were to be drawn at Delmar Boulevard, the northern portion of the city would have the highest concentration of vacant properties in the country.

Next: The impacts of highly-concentrated vacancy range from lower property values and increased illegal dumping to higher rates of drug and gun-related crime.

“Where there is a high concentration of vacancy, there are also challenges - like a lack of access to public transportation and technology, poverty, housing cost burdens, increased amounts of lead poisoning and asthma,” Ginn said.

As a city, St. Louis is taking a comprehensive, thoughtful and collaborative approach to rebuilding a more equitable community - starting with the organized group (of which all the presenters are involved), called St. Louis Vacancy Collaborative.

The Collaborative launched in 2018 and is made up of more than 40 organizations, twelve city departments, hundreds of volunteers and committees, and six working groups (Anti-Displacement, Data Analysis, Marketing & Engagement, Reinvestment & Reuse, Stabilization, Maintenance & Demolition, Vacancy Prevention).

Another stat presented: 60% of vacant property is privately-owned, which presents many challenges in reinvestment and stabilization. As public organizations work to care for the approximately 40% of properties under their ownership, they are also working to hold vacant landowners accountable for the condition of their property.

“Of crucial importance to this initiative is the redevelopment of vacant properties. We can clean them up and preserve the buildings, but ultimately we need people to invest in the urban core,” Lewis said.

Over the last few years, the City of St. Louis has launched multiple efforts to encourage investment in these areas, including Proposition Neighborhood Stabilization (NS) and the Gateway Neighborhood Fund (GNF).

Proposition NS has created funding for the city to stabilize properties within their land bank to not only improve public safety, but also to encourage development.

GNF has made provisions for approved homebuyers looking to purchase and improve homes in areas where there is an appraisal gap. Enabling home buyers to purchase and renovate these homes helps to increase their value and encourages investment in distressed neighborhoods.

Substantial time has been devoted to reforming property tax foreclosure procedures. Tax foreclosure on home owner occupied properties is not only devastating to the residents, but to the neighborhoods as well.

Two of the Collaborative’s recent efforts to prevent displacement and vacancy are the Real Estate Property Tax Assistance Fund and the Home Repair Network & Fund.

“Tax assistance and home repair assistance help fill local budgets, prevent an increase in vacancy, stabilize neighborhoods and protect home owners facing economic hardship,” Whiteside said.

Should tax foreclosure be necessary, the Collaborative is working on reformation to bring properties to auction sooner so that the community will not suffer from an unoccupied, and therefore untaxable, neighboring property.

“Many people don’t see and recognize the importance of building relationships, but engaging communities and neighborhood residents in the process is how we build a better city. The plans we’re developing help people have a hope for the future.” Whiteside said.

The Collaborative is always looking for volunteers, you can use this link to learn more about the working groups and how you can get involved.

If you would like to view the full program, a YouTube recording is available here.

Current Chesterfield development on par with 2019

This week’s CCIM St. Louis Metro Chapter virtual luncheon presentation provided solid insight to the development of the Chesterfield, Mo. area.

With presentations from Mike Geisel, city administrator with the City of Chesterfield; Tim Lowe, VP of leasing and development with The Staenberg Group; and Jeff Tegethoff, operating partner of CRG, attendees received a comprehensive look at the future of the city.

Geisel started the presentation by introducing “Envision Chesterfield,” the city’s comprehensive plan completed through a 21-month process which was adopted in September of this year.

Data shows that the city of Chesterfield has grown at 2.6 times the rate of inflation. With 44 active development projects, the city is on par with 2019 numbers despite the challenges of 2020.

“In the last ten years, we’ve seen 2,300 residential units being developed. We’ve seen 3.9 million SF of commercial development and 650,000 SF of industrial development,” Geisel said.

The District and Wildhorse developments are two large components contributing to the current success in Chesterfield, according to Geisel.

Working from the opportunity of their neighboring tenant TopGolf, The Staenberg Group is developing The District - previously an old outlet mall - into a new entertainment area. The revitalization has recently handed over the 48,000 SF shell to their new tenant, Main Event, set to open in June 2021.

On the other end of the property, The Factory, the first built-from-the-ground-up live music venue in the Midwest in more than 20 years, is currently underway. Lowe acknowledged the risk of this type of facility in the current COVID climate, but also noted the high demand from both fans and bands.

“We’re excited. This is going to be a unique draw to the area. They’re planning to open in May of next year. While the current guidelines would not allow The Factory to open and be successful, the good news is that there is a lot of pent-up demand for next year. We are hoping the rules of engagement in 2021 will allow us to open and be functional,” Lowe said.

Phase 2 of The District will feature an open-entrance, steel structured pavilion which will serve as an eye-catching anchor of the development.

“We have a lot of work to do to figure out what goes under the pavilion, but (we) will have grass, fire pits and outdoor seating. It’s a neat area within the development that allows people to read books, play with their kids, things like that,” Lowe said.

The final phase of The District is currently being planned. At this point, potential activities include indoor and outdoor pickleball, sand volleyball and eSports.

Lowe also mentioned the Chesterfield Mall, which The Staenberg Group is currently working on a master plan to convert the property into an urban downtown development. The plan includes housing, office, retail, and restaurants, and is scheduled to be completed and presented to the city by the end of the year.

Tegethoff also shared his vision for the existing Wildhorse project and Wildhorse Village. Wildhorse has scheduled openings throughout 2021, including the 188-residential spaces in March and the AC Hotel by Marriott in December. The notable, 15,000-SF Ruth Chris Steak House opens in two-weeks.

Wildhorse Village, an 80-acre development to include 1 million SF of office space, more than 500-residential units and 100,000 SF of restaurant and retail space, is currently underway. The project will not be phased and anticipates openings as early as 2023.

“We never really thought about phasing Wildhorse Villiage. The momentum of early interest in the sub lots enabled us to do it all at one time,” Tegethoff said.

“We feel like there has never been a more exciting time to developing in Chesterfield.” Tegethoff said.

Despite the challenges of 2020, the city of Chesterfield is on the rise.

to view the entire program, please visit CCIM St. Louis’s LinkedIn page.