Investors find downtown property to their liking

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by Clarissa French|ret||ret||tab|

SBJ Editor|ret||ret||tab|

cfrench@sbj.net|ret||ret||tab|

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Downtown Springfield isn't what it used to be. Where once there were vacant buildings, now there are nightclubs, restaurants, loft apartments and new retail. Where once there were empty sidewalks, now there are pedestrians. |ret||ret||tab|

For those with substantial holdings downtown, ownership has come about in a variety of ways. Some have property that's been handed down from their parents or grandparents; some heard opportunity knocking a decade or more ago and invested when others wouldn't; and a dynamic new contingent of developers has driven rapid residential and commercial redevelopment in the last two to three years. (See property owner map on pages 26-27.)|ret||ret||tab|

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Next generation|ret||ret||tab|

Terry Reynolds is the owner of C. Arch Bay Company and the granddaughter of C. Arch Bay. |ret||ret||tab|

Reynolds said the company has not made any new downtown acquisitions since her grandfather died 10 years ago, but the family still has some significant holdings, mostly on the edges of downtown.|ret||ret||tab|

"We do have some commercial properties not many commercial properties left downtown, but we do have our office building (on Pershing), and then we have a restaurant (at) 301 South Avenue," Reynolds said. A second-floor loft is going in at 301 South, with work to begin this month. Butler Rosenbury and Partners is the architect on the job.|ret||ret||tab|

Reynolds said the company also has the restaurant property at 424 S. Jefferson, which most recently was Big Al's Diner. "We've leased that to a new lady who's getting ready to open. The Acoustic Caf I believe is what she's calling it."|ret||ret||tab|

Another property, a large warehouse on Tampa, is outside the traditional downtown area, but right in the Jordan Valley area, she said.|ret||ret||tab|

Reynolds said she is seeing a lot of interest in downtown in the last couple of years. "We get a lot of calls for loft apartments. All of our apartments around (Southwest Missouri State University) stay full; we're probably 80 percent full all the time."|ret||ret||tab|

Downtown went through a dry spell in the 1970s when Battlefield Mall was built and the square was closed to vehicle traffic. As a result, C. Arch Bay sold several of his downtown holdings during his lifetime. |ret||ret||tab|

"He got very disenchanted with downtown when they closed (the square) off. He was one of the ones who rode the bulldozer through the square when they reopened it because, in his opinion, closing the square just killed downtown," Reynolds said. |ret||ret||tab|

"He got upset and didn't feel like it was ever going to make a comeback, so he would be really surprised at what it's doing now," she added. Surprised and pleased. "He loved downtown. We love downtown. Our office has always been downtown, and we just feel like we've always been a part of downtown."|ret||ret||tab|

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Opportunity knocks|ret||ret||tab|

In the early- to mid-1990s, the downtown real estate market, which had largely been stagnant, slowly began to stir. A significant investor at that time, who still has substantial holdings, is Warren Davis. |ret||ret||tab|

"Our first property was purchased downtown around late summer of 1994, and the first purchase was the Woodruff Building," said Kim Harrington, owner/manager with Davis Property Management LLC and Warren Davis' daughter. |ret||ret||tab|

Davis had been retired for about two months, "and he had an office around a bunch of retired bankers and they were kind of joking around, saying That building is up for sale,' and Dad got interested because it was an appealing project; because he loves real estate. It was actually in a depressed state; the vacancy was pretty high at the time. So Warren bought it, just on a whim, just to give himself something to manage, something to do," Harrington said.|ret||ret||tab|

Davis later sold the Woodruff and McDaniel buildings, an adjacent parking lot and a parking garage at Benton and Trafficway to Downtown Springfield Properties LLC, the holding company of Brett and Bart Loethen, in 2002. |ret||ret||tab|

"We still own the Heer's Building and the parking lot adjacent to it, and the Park Central Office Building the former Bank of America," as well as the lot behind it and the parking garage across the street on McDaniel.|ret||ret||tab|

The Heer's building is currently under contract with Prost Builders of Jefferson City, a company known for its renovation of historic properties.|ret||ret||tab|

In the 10 years that Davis Properties has been active, downtown has changed 180 degrees, Harrington said. |ret||ret||tab|

"It's incredible how alive it is. It is just so vibrant," Harrington said. "You see all walks of life it's wonderful to see the mixture of culture and people downtown." |ret||ret||tab|

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New visions|ret||ret||tab|

Jason Murray, owner of Palacio Properties LLC, first came to downtown with his import business, Artifacts Ltd., in May 2000. |ret||ret||tab|

He established a retail location in the first floor of his brother Scott's building at 311 Park Central West. When Murray realized he needed more room a warehouse space with offices he purchased the former McQueary Brothers Drug Warehouse at 500 W. Olive. The second floor was vacant, and he turned the space into loft apartments. |ret||ret||tab|

Since that time, Murray has acquired additional properties at 308 S. Campbell, 501 W. College, 520 W. Olive and 505 N. Jefferson and has developed 63 loft units in the downtown area. Demand for those spaces is high, and Murray said he gets calls from prospective tenants on a daily basis.|ret||ret||tab|

His most recent project, Stove Works Lofts at 505 N. Jefferson, was completed two weeks ago and several tenants have already moved in. A few vacancies remain.|ret||ret||tab|

However, developing lofts is tougher than it used to be because rising property values and prices have raised the stakes.|ret||ret||tab|

"The properties I've bought, I've had to go in and rehab, and the price of the pre-rehabbed, vacant building has gone up a lot, making it difficult to find properties that you can afford to fix up," Murray said.|ret||ret||tab|

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