POSTED ON AUGUST 1, 2012:
A Story Set In Stone and concrete, and rebar, and hardwood floorin . . .
Developers, city trying to usher in new residents to downtown
Fewer than 4,000 people live downtown, according to 2010 Census data, and the last decade hardly saw any change in the resident population.
But a development boom includes new apartments promising a chance to live in the shadows of Tulsa's skyline -- for a price.
"Really, the critical thing is trying to get a project that people can rent that is a little more affordable. It seems that they're very sensitive to a price point that exceeds $1,000 a month, and that's the hard part," said Steve Ganzkow, who, along with business partner Jay Helm, has developed three downtown apartment projects.
Such concerns may cause financiers to fret, but developers say they expect more and more housing to break ground downtown. Two projects under development by the Snyder family, remodelers of the historic Mayo Hotel, promise rents mostly in the $500 to $800 range. Other downtown developers -- some local, some not -- have designs on transforming seemingly downbeat sites into homes, likely bringing a wider range of housing and rents to the area.
It's another side to the more splashy civic-minded projects like the BOK Center and ONEOK Field, or even new additions to the city's skyline like the mixed-use One Place project under construction next to the BOK Center, with that project also set to include residential units.
Lately, it's been mostly small- to medium-sized residential projects opening up. Many benefit from civic support, including financial incentives, as the renewed focus by city and business leaders on strengthening the city's center extends to getting more people to live downtown.
Jessica Johnson and her husband Brandon moved to downtown in December.
"Downtown is so much different now than it was five years ago," Johnson said, describing how she and her husband not only walk to work, but enjoy strolling to the ballpark or the bustling Blue Dome District for nightlife or a meal out. She and her husband have gone a week without using their car.
Yet for all that's been built, residents like Johnson see gaps in development that throw some quirks into daily living. For having work and entertainment options so near, downtown residents still lack easy access to a pharmacy or grocery store, for example.
"That's the biggest inconvenience about living downtown," said Johnson, 28. To stock up on food, the couple travel to a Reasor's location at South Lewis Avenue and East 15th Street.
"We try to only go once a week," Johnson said. It may not sound like much of a trek, but "it happens all the time, where you need one or two things," said Johnson, adding, "if I could just walk out a couple of blocks and pick it up and come back, that would be really nice."
Enough activity has taken place already for developers like Ganzkow to speak with certainty about downtown's future as a residential neighborhood.
The way Ganzkow sees things, "what's rewarding is that everything that has been put in the marketplace has been successful," he said.
Mike Neal, president and chief executive officer for the Tulsa Metro Chamber, came to Tulsa from Nashville.
Neal said the local downtown boom is part of a wider trend.
"During our tenure in Nashville, we witnessed just a major resurgence of downtown development and, certainly, of downtown residential development," he said, offering up that more people nationally have their sights set on urban living.
For local civic leaders, such growth seems to be viewed as vital to the well-being of the region. Former Mayor Kathy Taylor spoke about downtown in economic terms.
"No cities have great economic progress unless they have a vibrant downtown," Taylor said.
Taylor served as mayor when the costliest downtown project, the approximately $191-million BOK Center, opened in 2008. Funding came in before Taylor took office, when Tulsa County voters passed Vision 2025, a sales tax increase to fund various projects. In 2003, voters approved a one penny increase in sales tax to last for 13 years.
Cranes and hard hats now seem an almost permanent part of downtown. The work involves a new home for a TV station, an $11-million hotel, the Hardesty Arts Center and the reconstruction of the Boulder Street Bridge, among other projects.
City leaders "see so much more now how important downtown is, not only to the rest of the city of Tulsa but also the region," said Clay Bird, the city's chief economic development director. He called the downtown focus "something that's been a big shift within the last decade."
Bringing more people to live downtown is "just an example of investment and being a return on investment for our community," explained Delise Tomlinson, executive director of downtown development for the Tulsa Metro Chamber.
Tomlinson began her duties not long after Downtown Tulsa Unlimited, a longtime downtown stalwart, basically ceased operations in 2009.
Along with Tomlinson's downtown focus, this year the chamber, along with the city and county, announced plans to hire a downtown consultant. The goal is "to try to avoid any type of duplication of services and to really try to identify and seek opportunities to leverage the work of each partner," said Neal.
Tomlinson said more research should be done on housing demand, though such a study was finished only two years ago for the city's Economic Development Commission.
A survey of potential downtown residents, the study concluded that "it is probable that one bedroom rental units could be brought to market in the subject market area within at least the higher portion of the $600 to $950 range."
The study also noted that at the time, about $15 million in public funds "have been invested to leverage private residential multi-family development" downtown, resulting in more than 350 housing units.
Some projects continue to struggle with funding, like the proposed Cam's Grocery on South Detroit Avenue. In a brick building where Dan Cameron envisions fresh produce, piles of debris sit unattended.
"The holdup is simply capital," said Cameron.
He first announced plans about a year ago to open a store in the Blue Dome District in a building not quite double the size of an average QuikTrip convenience store. Investors so far have been wary about putting money into a business known for having tight profit margins and relying on heavy sales volume to be profitable, he said.
In the meantime, he's started a limited grocery delivery service that has about 20 customers.
"There still is a lot of interest in Cam's Grocery. There's a lot of momentum," Cameron said.
When talking to investors, he said he's been able to bat away concerns about a lack of population nearby.
"The people who are on board right now, they're people who believe in downtown and want to be a part of this resurgence," Cameron said.
A smaller grocery project is moving forward. Businessman Blake Ewing, who also sits on the city council representing the district that includes downtown, is working on opening a small grocery and deli about the size of a convenience store on the first-floor of the Detroit Lofts building, which opened just two years ago.
The lofts project, a 16-unit adaptive reuse of an existing building, received $769,000 in Vision 2025 funds.
Three other downtown housing projects -- First Street Lofts, the Mayo Hotel (which also includes apartments)and the Mayo 420 Building -- have been approved to receive a total of $9.2 million in public funds. Together, all four projects total about 175 units of downtown housing, though First Street Lofts has yet to open.
Ganzkow said the city and another entity, the Tulsa Development Authority, have been helpful to developers, apart from financial incentives.
"We have experienced a lot of cooperation, and invariably, you're going to run into problems. We've always been able to sit down and work out things," Ganzkow said.
The projects receiving public funds have varied in their scope and nature. The Mayo Hotel touts on its website how "no expense has been spared," clearly aiming for the luxury market with its rentals.
For all areas in the Tulsa housing market, the average apartment rented for $580 monthly, according to a 2009 housing market report by the U.S. Department of Housing and Urban Development. More recently, CB Richard Ellis Oklahoma released a mid-year housing market survey which tabbed the average one-bedroom rental rate at $488 and the average two-bedroom rental rate at $611 (or $654 with two bathrooms).
Downtown might not be the spot for bargain-hunters, but "I think that has been the intent of the city and many others to make sure that housing downtown is available to all economic groups," said the chamber's Tomlinson.
While some projects are embedded in "sleek" towers, others have started out as "pretty homey-looking brick warehouses," Tomlinson said.
No doubt, many of the residents choose to live close to where they work, and downtown has a daytime population of workers that soars to about 33,560, according to a 2006 report by state census workers. Major employers include Public Service Company of Oklahoma, AT&T, Bank of Oklahoma, ONEOK, Samson and Williams. Workers tied to the booming nightlife may also choose to live downtown.
"There's a high correlation between the people that work downtown and want to live downtown," Ganzkow said, adding that the market is "not necessarily 9 to 5ers," with "pretty broad demand for it across age groups and across income groups."
Johnson said she came to Tulsa six years ago for a job in finance. About five years ago, she and her husband knew they wanted more space than a one-bedroom apartment, and they considered moving downtown.
"But at that time, there wasn't anything here," Johnson said.
She described the couple's options as limited to the Philtower building, which advertises itself as offering "downtown Tulsa luxury." At the time, the location didn't quite fit their budget.
Even if it had, Johnson described downtown as a sort of ghost town after a workday.
"In the wintertime, when it got dark at 5 o'clock, it was kind of scary to walk to your car after work," Johnson said.
After living for four years in a house in the Florence Park neighborhood, Johnson and her husband decided it was time for a change -- and realized downtown housing had bloomed.
Johnson said they studied four options while looking for a two-bedroom apartment. Only one of these buildings, the Tribune Lofts, one of Ganzkow's first projects, existed five years ago.
"There was actually a long waitlist in our building for one-bedrooms," said Johnson, a member of Tulsa's Young Professionals, a group commonly known as TYPros affiliated with the Tulsa Metro Chamber. With the couple scouting for a two-bedroom unit, however, she said she didn't find a scarcity of choices.
Ganzkow said apartments have been filling quickly at the properties he's been involved in developing.
"The Tribune is 100-percent occupied," he said, referring to the 35-unit building. The former warehouse was converted into apartments more than 10 years ago.
Conversion projects have been especially popular thus far, but downtown project have more challenges than starting from scratch in the suburbs, Ganzkow said.
"Strategically, these projects are very, very complicated," Ganzkow said. "There's probably 20 to 25 percent more to do than something in south Tulsa. You're working on very tight sites, land is very expensive, utilities are very expensive."
Downtown developers must also answer questions about parking. At the Tribune Lofts, parking is available for an extra fee.
For Johnson and her husband, who frequently have friends come over, "it really hasn't been an issue at night and on the weekends," she said. The couple pays for a space in a garage adjacent to their home, the Mayo 420 Building. but during the week parking can be an issue for visitors, Johnson said. The couple sometimes have friends park outside downtown and then give their friends a lift into the neighborhood.
The housing study noted that "when asked about parking, the majority indicated that they would need two parking spaces, and the majority expressed an expectation of having a private garage associated with their residence." The city has undertaken a downtown parking study to further examine the issue.
"Right now, in Tulsa, to have apartments you definitely need to have some sort of parking offered," said Macy Snyder-Amatucci, part of the business group behind the Mayo Hotel.
At the Mayo, basement parking allows residents to remain indoors while traveling between their homes and their vehicles, a feature planned for two other apartment buildings being developed by the Snyder family and other investors. The group is developing the Vandever building into 44 apartment units and the former YMCA building into 82 apartment units. Snyder-Amatucci said the Vandever project is expected to open in less than eight months, with more than a year before the former YMCA building opens.
"A lot of other properties are outsourcing their parking ... then selling it back to residents," Snyder-Amatucci said.
She said the two apartment projects under construction will feature more than one parking space per apartment unit, but perhaps not enough spaces for every resident.
Bob Fleischman, president of the Brady Arts District Business Association, said that over the last four months, East Archer Street has been changed to allow parking on both sides of the street -- adding approximately 140 parking spaces to the neighborhood. Also, the city-owned parking garage at South Main and 1st street recently began allowing visitor parking Thursday, Friday and Saturday nights, though overnight visitor parking remains prohibited.
Several spaces allow for only two-hour parking from 8am to 6pm, but even that could change. Fleischman said city leaders have been mulling a proposal for residential exemption stickers that would allow residents expanded parking privileges in some of the business spots.
The district has seen several businesses open up within the last year or so, including bar Valkyrie, clothing and accessories store MOCHA Butterfly Boutique, and phone accessories business Insanely Great Products. Nightspot Bar 46 is opening soon, while another planned venture is the Lightspeed Café.
Recently opened near the Blue Dome District is 1320 Bar & Grill, while Sager said another restaurant will be filling the space formerly occupied by the Blue Dome Diner, with Albert G's Bar-B-Q restaurant also expected to open soon.
Elsewhere downtown, restaurateur Libby Auld has plans to open a restaurant dubbed The Vault in a former bank building.
Under renovation is the former Mathews Warehouse building, which will host several arts endeavors. The first of those opened this year, the Henry Zarrow Center for Art and Education, a part of the University of Tulsa. To the north, construction is underway for an outdoor park known as the Guthrie Green, a former parking lot that will feature covered pavilion space.
The George Kaiser Family Foundation has been heavily involved in both projects -- as well as two housing developments done primarily as a way to provide housing for Teach For America teachers.
"It was a little bit smaller footprint" for apartments, said Stanton Doyle, a senior program officer with the foundation. Despite the tight quarters -- the teachers "snapped them right up."
It would be hard to find more affordable living downtown. Doyle said a studio goes for $350 monthly, with rents roughly $1 per square foot. He noted that the foundation willingly subsidizes the two apartment sites -- Brady Lofts and Robinson Packer Lofts -- at likely below-market rents to ensure affordable housing for the recent college graduates driven to teach.
"It's really just about the price," Doyle said, adding, "I think they know what kind of lifestyle they want, and the size of the space is secondary."
Not every project that's been proposed will get built, and already there have been some notable delays.
Ganzkow explained that, in general, it can take three to five years to execute an apartment project. Larger economic forces can stall even the most well-planned project, he said, listing a development he helped oversee, The Metro at Brady, as an example.
"Here we were all ready to go, and we had to scramble to continue to find financing," Ganzkow said.
Finding banks to extend money for downtown housing in the past was quite difficult, Ganzkow said.
"I can assure you, years ago they didn't want to talk to you," Ganzkow said.
Despite continuing economic uncertainties, Ganzkow said the financing environment has become more favorable to developers, crediting banks with a change in attitude.
"I think they're eager and wanting to try to participate in this development downtown," Ganzkow said.
O. C. Walker II, executive director for the Tulsa Development Authority, heard from 13 development groups who applied for public funds as part of a request for proposals related to downtown housing.
As far as financing, "we heard stories the entire gamut," Walker said. "'I'm almost there,' or 'a long way to go.'"
One project that has been oft-delayed has been the First Street Lofts, a project perhaps more scrutinized than others because it received Vision 2025 funds, yet has fallen behind schedule.
"We are confident that the project is going to be complete," Walker said.
Michael Sager, the developer behind the project, said the lofts will open in 2013 with 23-residential units.
"It is not a luxury project. We have backed it down," Sager said. The size of the units has been decreased from original plans. "If they're smaller, they're more affordable," he said.
Like other projects - including the GreenArch project at the corner of East Archer Street and Greenwood Avenue -- it has a mixed-use component.
In the First Street Lofts, S & J Oyster Bar, formerly a well-established restaurant in Brookside, will open soon, while Whiskey Business, an upscale liquor store, has already opened.
Also set to move in the space is Equalibrium, a yoga and massage studio.
"With all the residential units that are going to be coming into the building, it just seemed like a natural fit to have a health studio within the same building," said co-owner Heather Crim, explaining how she and business partner Sarah Smith selected the site.
She said she thinks downtown is lacking businesses like Equalibrium. Clientele are "probably going to be a lot of the people who work down here coming in for lunch," said Crim.
Potential customers from other parts of town may have to adjust to visit the studio, she acknowledged.
"In any vibrant downtown area, that's one of the things you do: you park and you walk," Crim said.
In its most recent use of tax dollars to support downtown housing, the development authority offered $3 million in funds to provide what Walker called "gap financing" for downtown housing proposals.
The 13 applicants were "actually more than we expected, because we only had $3 million dollars," Walker said.
He said he doesn't know exactly how many of those projects are moving forward, but said 12 out of the 13 proposals were very strong.
Apart from tax dollars, the development authority -- basically the real estate arm of the city - also owns several pieces of land downtown that either have been sold or are in negotiations to be sold to housing developers. These projects include some that have broken ground, like the GreenArch Apartments.
Others remain on the drawing board, like an apartment complex known as the Brady District Flats project touted as a partnership with the nonprofit Community Action Project to offer affordable housing. "Again, they're waiting on funding," Walker said.
In Walker's eyes, downtown also stretches south to include approximately 40 new townhomes on West 11th Street behind the DoubleTree hotel. This income-restricted project, known as Riverbend Gardens, is set to open in the fall, he said.
It's only a little more than a half-mile from the BOK Center, yet relatively small differences can make a difference in the minds of prospective renters who work in downtown office buildings.
Johnson said she and her husband Brandon briefly considered living at West 11th Street and South Denver Avenue, but "we definitely ruled that out really quickly." She said the location on "the opposite end of downtown" didn't fit their desires to be close to work and the Blue Dome District.
Snyder-Amatucci, who is working on projects mostly in what some have dubbed downtown's finance district, said that the arena and baseball field have helped tie together central downtown and the area north of the railroad tracks that includes the Brady Arts District.
And another project that received a green light for public funds is planned for an old car lot site on the eastern edge of downtown, just south of the Blue Dome District. It remains to be seen if different areas will attract different types of residents.
The Metro at Brady, which has advertised rents starting at $850, features a swimming pool. On a recent summer day, a crowd laughed and shouted while beating the heat.
It's not a common sight at downtown apartments, however. "We have a lot of people ask us if there's a swimming pool here," said Snyder-Amatucci with the Mayo Hotel. There isn't, and pools might not be the norm for most projects.
Living downtown also means adjustments in other ways for those used to living in a suburban-type environment, Johnson said.
"Having that private outdoor space is what I miss most of all," she said.
Among her group of friends, most have chosen to live in a house. "It's still not super affordable to live in downtown compared to other options right now," Johnson noted. "But I think mostly it's a lifestyle choice." In her peer group, anyway, "most people think the idea of living downtown is cool, but they're not willing to do it," Johnson said. "They're not willing to give up the space that they have in their house."
Developers don't seem fazed by this thought, however. Shelby Snyder, a sales manager for the business group behind the Mayo, said the target for the two new renovation projects will be young professionals right out of college. This is the group of single young adults that likely doesn't expect to have two parking spaces, yet craves an urban experience, she said.
The Snyder family now has their hand in about a half-dozen real estate projects, but they began with the renovation of the historic Mayo Hotel, a project that drew little interest from corporate developers.
Other downtown housing developers also have been local, like Sager, well-known as a business developer in the Blue Dome District.
Elliot Nelson, who made his name as a driving force behind James E. McNellie's Public House, a bar and restaurant that has been cited by some as a key in developing downtown entertainment options, has also been involved with another housing development project on the drawing board.
Not every downtown project will have Tulsa backing, but Snyder-Amatucci doesn't see that as a bad thing for the average renter.
"We are locally-owned and operated and I think Tulsa is just great at supporting local businesses ... a lot of cities don't have that, they don't care, and I think that's what makes Tulsa so unique," Snyder-Amatucci said. "But I think competition helps everybody, and it's exciting to see big chain whatever-it-is interested in investing in downtown Tulsa."
Neal, with the Tulsa Metro Chamber, said he expects downtown to continue to change dramatically. He noted that the expected arrival of a medical school collaboration between the University of Oklahoma and the University of Tulsa, which would reshape the area near South Greenwood Avenue and East 1st Street.
"As we look at the next three to four years, I think we'll see it continue to grow at a very rapid pace," Neal said. "People like to be a part of this stuff, the revitalization and the vibrancy of the urban setting." Along with the construction downtown, Neal said "the next challenge" is to connect the area with development plans for the Arkansas River.
Johnson said those with an interest in moving downtown don't need to wait.
"I think a lot of people are waiting for downtown to become exactly what they want before they come down. And what we recognize is that, in order to make downtown what we want, we need to go and support it. We need to be living there. And the more people we have down here, the more demand there is going to be for more businesses and grocery stores and that's where the development is going to come," Johnson said. "People need to be here to drive that growth and not wait for it to happen."
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