STL Development Unfazed by COVID

Despite the economic downturn and rising COVID cases, St. Louis economic development is still churning along in a surprising manner.

Construction photo of One Hundred in the CWE, provided by CLAYCO:

It’s true that St. Louis has, over the past several decades, been reeling from its industrial economy withering away and has not been a shining star of economic stability. Yet, the forces that made St. Louis economically unstable are themselves disappearing as new industries take hold in the metropolitan area and a greater trend toward regional collaboration and workforce development. With a steadily growing Biotech sector, incredible research universities including Washington University, SLU, UMSL, and others, a blossoming Geospatial Intelligence sector, and a diversifying startup community, St. Louis of today is much stronger.

The metropolitan area is starting to make a name for itself with these new industries, and with coordinated workforce development and more competent leadership, these industries are growing.

With the new NGA facility just north of Downtown, the Geospatial Intelligence sector is poised to create thousands of jobs and revitalize a section of St. Louis City that has historically struggled. At the same time, the Federal government is bringing over 1000 USDA jobs to Downtown St. Louis, just as Accenture announced 1400 new jobs in Town and Country, with many of those jobs working in Federal contract related roles.

In the Cortex, KDG is still planning its Cortex K development, and Washington University has a crane up for its 11-story Neuroscience facility, which would be the largest in the nation once complete. The Aloft hotel just opened its doors to visitors, supporting the innovation and startup community. Cortex leaders have signaled that there will be more to come soon.

Strong industries do more than provide jobs to their direct beneficiaries. They add to the tax base, supporting city functions in the future. Moreover, they contribute to the strength of their communities, making other new jobs and developments possible. With all of the activity in the Central Corridor, there is the capacity to support hundreds of wealthier residents, with the One Hundred luxury apartment building nearing completion. In Lafayette Square, a new luxury apartment building was just announced which presumably will house the residents occupying these higher paid positions in the growing industries.

Of course, there is also the City Foundry development in Midtown, which is supposed to open its doors this Fall with a new grocery store, cinema, and a food hall with a dozen or more entrants. We also covered on this site the hotel planned on Jefferson at the Wells Fargo campus.

Not everything is so rosy – there have been some developments that have stalled, such as the Armory building in Midtown. Although the developers at Green Street have completed most of the exterior work, potential leasing issues and a lawsuit are delaying further construction, much in part due to difficulties with financing and finding tenants during the age of COVID. It’s all but certain that developers are going to present new projects at a slower pace, but this is far from a situation where St. Louis stalls. Instead, St. Louis will keep seeing cranes in its skyline.

From the Chelsea apartments in DaBaliviere Place, Forsyth Pointe in Clayton, Clarendale in Clayton, to the Iron Hill development on Grand, we’re set to see so much more new construction over the next several years.

This is anything but a dull time in St. Louis, and hopefully this means our city and community will be in a good place for a solid recovery as our crises end sooner rather than later.  

Former 7-UP Headquarters and Vacant Parcel in Clayton Rumored to be Developed by KDG

The long-vacant former 7-UP HQ at 121 S. Meramec and the next door vacant parcel are rumored to be redeveloped by developer KDG in the coming months according to Clayton officials.

The office mid rise has been owned and maintained by St. Louis County for several years, however, STL Partnership issued an RFP early this year to developers. The building is likely to be replaced completely due to its age and general condition, having been constructed in 1964, according to sources close to the development. The parcel of land used to host a smaller office building, but was razed in 2014. You can still find evidence of its existence if you look closely at the remaining tower. On its Northern edge, visible in the photo below, you can see what remains of an elevated walkway with a door leading nowhere.

121 and 111 S. Meramec as shown in Google Maps

KDG has been eyeing this site for years, as first reported by NextSTL in 2014. At the time, the Koman group planned a residential conversion for the larger of the two buildings. Koman merged with Keeley Development Group this year, and owns the residential tower in the background, Clayton on the Park.

This would not be KDG’s first planned residential conversion on an old structure. Earlier this ear, KDG announced they would rehab 1500 S. Grand according to the St. Louis Business Journal. They purchased the structure and two adjoining properties from SSM Health for $1.1 million, taking on a significant project as the midrise is in fairly rough visual shape.

1500 S. Grand as shown in Google Maps

KDG owns and operates several other high profile buildings around the St. Louis area, including Chroma Phase 1 and 2, The Euclid, Clayton on the Park, and the soon-to-be 4545 Laclede, Olive Crossing, and Cortex K developments.

New Hotel Planned in Midtown

Even as St. Louis has experienced record levels of development over the last few years, Midtown still tends to lag other neighborhood, particularly near the Wells Fargo Campus. That’s all set to change with the Jefferson Connector, part of the Midtown Alley project.

The Midtown Alley project is set to include more residential units with the Beaumont Lofts, office space, and of course the new hotel project dubbed the Jefferson Connector. The hotel portion will renovate a large section of the Wells Fargo campus, as pictured below.

This stretch of Jefferson will benefit from significantly more activity and should make the Western edge of Downtown far more welcoming to visitors. The hotel will boast just over 200 rooms and should be completed sometime in 2023, according to the developers at Green Street.

With the new MLS Stadium, a rehabilitated Union Station, and this new hotel, Midtown should look and feel very different in just a few years time.

St. Louis Real Estate on Fire

Although St. Louis is home to lots of vacant housing stock (which I detail extensively in a prior story), COVID-19 has made St. Louis’ housing market hotter than it has ever been.

As a REALTOR and current buyer, the market has created an extraordinary environment that we’re not quite used to in this city. With the virus, new listings are down significantly versus where they were last year, with sellers not looking for extra foot traffic in their homes or investment properties.

And yet, despite the economic fallout, there are many, many buyers still looking for homes and investment properties in a market with substantially less inventory.

St. Louis was already in a real estate renaissance, with over $8 billion in investment in its central corridor neighborhoods, changing the landscape of a city long reeling from its post-industrial past. And today, prices are finally being pushed up as demand exceeds supply, in a market that has not seen a similar dynamic for decades.

One of my first buyers looked for a duplex rental property starting in February, and within days, we had toured about a dozen or more properties. Sellers were not yet avoiding showings, and inventory was everywhere the proverbial eye could see. We never made an offer near list price, and were almost always able to at least see counteroffers or go under contract outright. However, due to poor inspections, he was forced to keep looking into late April. By then, each offer was entered into a bidding war, and the only hope was to use an escalation clause. Not only were the offers higher, but they came in fast, with properties going under contract before we could ever step foot inside.

Unsurprisingly, the situation has become more and more difficult since then. For sellers willing to take the risk, the current economic situation is a dream come true. As my fiance and I looked for our first rental property, starting in April, we knew we were entering a market that was catering to the opposite party. However, when you’re ready to invest, you shouldn’t look away, there’s never a perfect time.

We never would have expected, even with prior experience, the difficulty we faced finding our first property and getting it under contract. Nothing new was listed, with dead weeks in the neighborhoods we loved. As soon as one came on market, it was instantly given a bidding war. For those in the area, I’m talking Compton Heights, Forest Park Southeast, Skinker-Debaliviere, etc. The most desirable neighborhoods had a glut of demand that, despite the times, had receded far less than supply.

We finally found one we love and have it under contract, post-inspection, set for closing in July in a great neighborhood. The catch? It’s a for-sale-by-owner, allowing us to avoid some of the competition we faced. We were forced into a new market altogether, with the MLS void of what we were looking for.

Sellers: Now’s the time. There are proper protocols to keep your home safe, and if you’re willing to sell, this is perhaps the best chance we’ve seen in STL for decades.

Forsyth Pointe Development Poised to Reshape Clayton Skyline

U.S. Capital Development’s Forsyth Pointe is poised to reshape the Clayton skyline in short order. Set to bring two new Class A office towers to Downtown Clayton, Forsyth Pointe appears to be near finished with foundation work and site preparation. Steel has started appearing on site and both tower cranes are ready to go.

For those unfamiliar with the project, the West tower will rise 14 stories above ground and the East tower 16 stories. The two mid-rises will be connected by a parking podium with artwork displays on each corner and an outdoor patio between the buildings. As a concession and agreement with Clayton officials, the outdoor section will be open to the public occasionally for events.

Rendering above attributed to U.S. Capital Development.

The development is going to activate an important section of Downtown Clayton with more retail fronting Forysth Blvd. as well, with plans pointing to various cafe and outdoor dining applications. The Western edge of Clayton has not received as much development as the East end, with Centene’s headquarters dominating the skyline in recent years and the Sheraton redevelopment into a Le Meridian on track to finish this year. While the Western edge has seen a new apartment midrise with 212 Clayton completing a couple years ago, this development will add significant density and likely be visible to those entering the city from 170 South and 64/40.

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