Tuesday, September 24, 2013

Tourist Town

Memphis is going all-in on tourism and future sales taxes.

Posted By on Tue, Sep 24, 2013 at 2:31 PM

Converting the fairgrounds to a sports tourism magnet is going to be hard. You only have to look at the consultant's report.

Not the one that came out this month justifying the proposed public/private financing for a new $233 million Tourism Development Zone (TDZ), but the one that came out in 2009 criticizing the proposed public/private financing for a $125 million TDZ. The same outfit, RKG Consultants, wrote both reports. Same property, same centerpiece — the 155-acre fairgrounds and Liberty Bowl Memorial Stadium.

The earlier proposal came from a partnership led by Henry Turley, downtown's preeminent developer, and Robert Loeb, developer of Overton Square. Turley called it "the best idea I ever had," but it wasn't good enough to get city support.

The problem with using future retail sales to finance development at the fairgrounds, as RKG saw it then, was not so much the recession as the location, the competition, and the nature of retail. Fairgrounds retail "would fill a void in the local market area, however it lacks highway presence and the tenant mix to be a regional consumer draw."

Because "most all of the sales activity would be reallocated sales already occurring elsewhere in Memphis" the projected stream of sales tax revenue was "insufficient to retire $112,264,000 in bonding."

The new fairgrounds proposal, which must get state and city council approval, has no private developer and does not name the operators of the "second-to-none amateur sports venues," 400,000 square feet of "destination retail," or the 180-room hotel on the property. It expands the TDZ to three square miles, taking in tax-generating businesses that are up to a mile west and north of the fairgrounds from North Parkway to Overton Square and Cooper-Young. A bag of groceries purchased at Kroger on Union, a round of margaritas at Chiwawa in Overton Square, and a ticket for a football game at the stadium all figure into the deal.

Memphis is going all-in on tourism and big projects supported by increases in future sales taxes. In a supporting letter for the new fairgrounds TDZ, Mayor Wharton wrote "the fairgrounds project will also serve as the central hub of the city's family-tourism expansion through its developments at Graceland, Bass Pro at the Pyramid, and the Riverfront."

He makes no mention of the proposed Crosstown project which is less than a mile from the edge of the fairgrounds TDZ and is seeking $15 million in public funds. The Bass Pro Pyramid is part of a separate TDZ. Projections envision three million visitors a year.

In a TDZ, Memphis gets to keep the incremental increase in state and local sales taxes above a baseline number. The lower the baseline, the bigger the increment. In this proposal, the baseline is 2012 sales tax collections.

"The city of Memphis has commissioned the in-depth, serious research by experts." Well, commissioned experts usually tell you what you want to hear. That goes for both Turley's aborted project and this one. Turley's vision was "a place so excellent that it brings major competitions to Memphis" and team sports "as a unifying force where diverse youth find common ground." Noble thought. Think of the unified school system.

Excellence is in the eyes of the user. In youth sports, that's a car or bus full of restless teens and pre-teens and their parents. Their priorities are apt to be proximity to a shopping mall, fast food, a cheap motel with a swimming pool, and an easy-to-find location right off a major highway.

In the current proposal, I'm not sure Overton Square, boutique hotels, a 5,000-seat multi-purpose building, "exemplary architectural design," and "New Urbanist designed retail" in a Midtown "urban village" mesh with that. And if Central Avenue is "a prized site" for retail, then why is Fairview Middle School still there?

The competition for amateur team sports is fierce. In Memphis and DeSoto County, First Tennessee Fields and Snowden Grove get the baseball tournaments, Mike Rose Fields gets the soccer tournaments, and the Racquet Club and Leftwich Tennis Center go after the tennis business.

The real eye-openers, however, are the vast lighted sportsplexes in towns like Jackson, Tennessee, Jonesboro, Arkansas, and New Albany, Mississippi. The people running them know their market, and they have made deals with sponsors and coaches. You might not have heard of Joe Mack Campbell Park on U.S. Highway 63 in Jonesboro, but in Arkansas they have. Fields are sponsored by Arkansas State, NEA Baptist Clinic, Five Guys, and Delta Dental among others.

If football has taught Memphis anything as it aspires to national recognition, it is not to underestimate Arkansas State and "smaller" opponents.


Comments (19)

Showing 1-19 of 19

Add a comment

Subscribe to this thread:
Showing 1-19 of 19

Add a comment

© 1996-2018

Contemporary Media
460 Tennessee Street, 2nd Floor | Memphis, TN 38103
Visit our other sites: Memphis Magazine | Memphis Parent | Inside Memphis Business
Powered by Foundation