insights (2005-44)

Prioritizing a Downtown Retail Strategy

More than six months ago, a Downtown Advisory Committee appointed by Mayor Bill Haslam submitted what it termed a “Downtown Improvement Strategy” to the city administration. Yet, while downtown redevelopment has continued apace this year, little progress appears to have been made toward implementing that strategy.

The committee’s top-priority recommendation called for the city to “develop and implement a Downtown Retail Strategy, including marketing and recruitment, administration of incentives, and management of retail efforts. Completion of the movie-theater complex and Mast General Store projects should be used advantageously to maintain investment momentum on Gay Street… and in the Market Square area. The strategy should establish a set of economic development tools consistently available for prospective retailers, with a commitment of funds adequate to aggressively pursue prospects.” 

To give direction to those and other efforts, the committee recommended creating the position of a Downtown Director “dedicated solely to downtown-related activities. This position should be broad-based in expertise and should be a Senior Director with a direct reporting relationship to the Mayor.”

But Haslam didn’t see fit to create a new high-level position in his administration. Rather, he named a lower-level operative, Jill Van Beke, to the post of deputy director of policy development/downtown. Van Beke is a young woman who gets high marks for her coordinating skills and attention to detail, but she’s not perceived as having the expertise or the authority to give direction to a retail-recruitment effort.

Van Beke reports to Bill Lyons, who’s been on an extended leave of absence from his post as a UT professor of political science ever since he served as Haslam’s campaign manager leading up to the mayor’s election in 2003. The estimable Lyons then became senior director for economic development, but he’s the first to acknowledge that the title didn’t really fit him—so much so that he subsequently sought a change to his present title of senior director for policy development. 

When it comes to a retail-recruitment effort, Lyons says, “Nothing other than some informal talking about the best way to do it has taken place yet.” And he goes on to convey a sense of preoccupation with downtown projects requiring immediate attention. Heading the list are plans for renovation of the Sunsphere and relocations from the Candy Factory, both in relation to complicated contracts with Kinsey Probasco for their redevelopment. “There’s so much action that the specifics have gotten in the way of the general,” he allows.

But prime downtown developers who remain appreciative of Lyons’ efforts on particular projects are growing increasingly impatient with a lack of overall planning. “The biggest problems that we’re facing are that we don’t have anybody acting on behalf of downtown’s interests when it comes to formulating a retail strategy, or implementing it, or anything else,” says David Dewhirst, whose assemblage of numerous downtown buildings remains a work-in-progress where ground-floor retail tenants are concerned (see cover story in this issue).

The president of the Knoxville Area Chamber Partnership, Mike Edwards, takes vigorous exception to such indictments of the city’s efforts. “We’ve got a retail strategy, and it’s going to work,” he asserts. “We’re getting two major anchors [Regal and Mast], and we’ve talked to a gracious plenty of other prospects who are telling us they’re not going to pull the trigger until the anchors are in place.” Edwards goes on to extol Haslam’s ability to relate to other retailers, drawing upon the mayor’s prior experience as president of Pilot Corp. “Why would you want to bring in a downtown recruiter when your best recruiter is your mayor?” he asks rhetorically.

Still, the city seems to be lacking some of the basic tools commended by consultants such as Economic Research Associates. Those include inventories of available space, demographic data, promotional literature and a package of incentives, aside from tax-increment financing that primarily benefits developers and building owners making improvements, rather than their tenants.

Two years after the completion of an $8-million makeover of Market Square’s public space and the facades of its historic buildings, their ground floors appear half empty. And some of their owners are chafing because the city hasn’t introduced a promised set of measurements of the square’s performance, including occupancy and rental rates. Lyons insists those measurements are only due to commence once the long-awaited Regal movie theater starts serving its intended purpose as a catalyst.

Some would argue that market forces will determine downtown’s retail destiny no matter what the city does. But it clearly took a set of city incentives consistently applied to set downtown’s remarkable residential renaissance in motion. The retail recommendations of the Downtown Advisory Committee should now be paid more heed. 

© 2005 MetroPulse. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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