Innovation and customer experience key to St. Louis commercial real estate growth in 2023

More than 100 industry professionals attended MetroWire Media's 2023 Market Forecast Summit on March 9, 2023 at the Lodge Des Peres, which featured networking and a panel discussion with Addie Bunting from Wies Offsite as the moderator, and panelists Lauren Talley with Cobalt Construction Consulting, Tom Ray with CBRE, Tom Kaiman with Mia Rose Holdings, and Kyle Wilson with Kadean Construction. The panelists covered a range of CRE topics related to multifamily housing, office, industrial, and retail real estate.

Here are some highlights from the session:

Impact of the new Citypark Soccer Stadium

Kaiman: “It’s a great addition to the city that will spur other development in the area. Quality developments will bring people back to town. It will be an exciting place to live. The Taylor family is doing a great thing with this investment in the city.”

Talley: “It is exciting to see midtown coming to life,” said Talley. “Out-of-town developers are coming in.”

Multifamily

Kaiman: “Multifamily has been undersupplied for decades; zoning, permitting and NIMBY continue to be problematic. A lot of new product is coming online in St. Charles County.”

Wilson: “We continue to see a lot more interest in multifamily and condo properties for sale among empty nesters in Kirkwood, Webster Groves and Clayton. Small projects seem to infill well.”

Ray: “Apartments will fix downtown. The answer is more apartments. It’s more important than ever that people can live in walking distance of their offices.”

Talley: “Multifamily has exploded. The result is a flight to quality while commercial is seeing a flight to amenities.”

Office

Ray: “Downtown is seeing a nice absorption in startup and early-stage businesses looking for office space needing little improvement. Landlords are ready to deal. There’s an historic view that the prime downtown tenant is a large law firm that will stay forever, but smaller startup companies are the future. There’s a lot of leasing as companies look for smaller office space.”

Kaiman: “There’s no longer a playbook or one size fits all. We’re still trying to figure it out. The world will continue to evolve in how we work, how we live, how we play.”

Retail

Kaiman: “Development fits everywhere. It’s all about how you activate a site and bring people there. It has to be safe. Cities that keep an open mind will benefit. The economic development folks have to be out there recruiting for new businesses.”

Wilson: “Store chains are taking a new approach, adding a smoothie bar, clothing for sale, etc., to create a new experience.”

Ray: “Mixed use is a goldmine for commercial/retail. It’s completely based on walkability.”

Talley: “Mixed use is kind of the ‘new black,’ and jurisdictions are mandating it. I think it’s here to stay. We need to grow to be more welcoming to national chains.”

Cannabis

Kaiman: “It’s the best thing that ever happened to empty stores. Data also shows property values going up around dispensaries.”

Industrial

Wilson: “We’re finding more mega-sites — they seem to be bigger and bigger. Tenants who need smaller space might be left in the dust. Big is booming.”

Talley: “We have the land available (that companies need for large industrial uses). Cost increases for materials and supplies led to a pause. Products delivered to the home with continue to grow (and require large warehouse and distribution facilities). Companies are looking to automation because it offers less human error or possibilities of people getting hurt — all industries are increasing automation.”

Wilson: “Automation has much higher construction requirements, so we’ll see taller buildings. If it gets traction, it will change the way we build warehouses.”

What Clients Want

Kaiman: “Our customers are tenants, so the flight to quality is their number-one driver.”

Wilson: “Our biggest challenge is being asked for more product. The subcontractor market is overloaded — they need more workers.”

Ray: “The collective experience in the office sector is adding more amenities. A new building has to be different from the one next door. You have to figure out how to provide experiences.”

Talley: “Clients want transparency in everything — costs, where products are coming from, when items will arrive, whether prices will be the same on arrival.”

Overall, the panel was optimistic about the future of commercial real estate in St. Louis, highlighting the potential for growth and expansion across all four sectors. They emphasized the importance of providing customers with unique experiences, as well as the need for economic development teams to recruit new businesses to the area.

_____________________________________________

CLICK HERE TO VIEW EVENT PHOTO ALBUM.

Green Street, HDA to HQ in new $20 million Bar K facility

Following the acquisition of HDA Architects by Green Street St. Louis (“Green Street”), the firms plan to combine offices this fall as part of the $20 million Bar K redevelopment at 4565 McRee Avenue in St. Louis, Mo.

The 64,000 SF redevelopment will include Kansas City-based Bar K’s first St. Louis dog park and entertainment facility featuring extensive indoor and outdoor areas for supervised dog play adjacent to bar, restaurant and event space.

Green Street and HDA’s combined offices will occupy approximately 31,000 SF on the first floor and mezzanine level of the building to house approximately 50 employees.

“We can’t wait to bring the Bar K experience to the people and dogs of St. Louis,” said Leib Dodell, the company’s co-founder. “The facility is going to be paradise for dog lovers, and we couldn’t be happier that Green Street and HDA will be part of our new community.”

In addition, Bar K will create a dog adoption and pet education facility in partnership with St. Louis-based Purina-owned pet-adoption site Petfinder.com, as well as Stay@Bar K, a 6,700 SF daycare and grooming facility in collaboration with St. Louis-based Kennelwood.

The development is the first of two phases planned for the McRee area. Green Street is considering its options for the redevelopment of the adjacent six acres at 4591 McRee Avenue.

Bar K is being designed by Arcturis with construction managed by Green Street Construction. HDA is designing the office component with interiors by O’Toole Design and Green Street Building Group managing construction. Civil engineering is being performed by Stock & Associates Consulting Engineers, Inc. with environmental consulting by ATON Environmental.

Emerald Capital Strategic Advisors assisted Green Street in sourcing and closing $18M in New Markets Tax Credit Allocation to support the project. Green Street also utilized other forms of non-traditional capital such as Opportunity Zones Investments to allow the project to move forward.

The dog park, grooming salon and daycare will create nearly 200 jobs and construction on the project will create 150 jobs.

Current Chesterfield development on par with 2019

This week’s CCIM St. Louis Metro Chapter virtual luncheon presentation provided solid insight to the development of the Chesterfield, Mo. area.

With presentations from Mike Geisel, city administrator with the City of Chesterfield; Tim Lowe, VP of leasing and development with The Staenberg Group; and Jeff Tegethoff, operating partner of CRG, attendees received a comprehensive look at the future of the city.

Geisel started the presentation by introducing “Envision Chesterfield,” the city’s comprehensive plan completed through a 21-month process which was adopted in September of this year.

Data shows that the city of Chesterfield has grown at 2.6 times the rate of inflation. With 44 active development projects, the city is on par with 2019 numbers despite the challenges of 2020.

“In the last ten years, we’ve seen 2,300 residential units being developed. We’ve seen 3.9 million SF of commercial development and 650,000 SF of industrial development,” Geisel said.

The District and Wildhorse developments are two large components contributing to the current success in Chesterfield, according to Geisel.

Working from the opportunity of their neighboring tenant TopGolf, The Staenberg Group is developing The District - previously an old outlet mall - into a new entertainment area. The revitalization has recently handed over the 48,000 SF shell to their new tenant, Main Event, set to open in June 2021.

On the other end of the property, The Factory, the first built-from-the-ground-up live music venue in the Midwest in more than 20 years, is currently underway. Lowe acknowledged the risk of this type of facility in the current COVID climate, but also noted the high demand from both fans and bands.

“We’re excited. This is going to be a unique draw to the area. They’re planning to open in May of next year. While the current guidelines would not allow The Factory to open and be successful, the good news is that there is a lot of pent-up demand for next year. We are hoping the rules of engagement in 2021 will allow us to open and be functional,” Lowe said.

Phase 2 of The District will feature an open-entrance, steel structured pavilion which will serve as an eye-catching anchor of the development.

“We have a lot of work to do to figure out what goes under the pavilion, but (we) will have grass, fire pits and outdoor seating. It’s a neat area within the development that allows people to read books, play with their kids, things like that,” Lowe said.

The final phase of The District is currently being planned. At this point, potential activities include indoor and outdoor pickleball, sand volleyball and eSports.

Lowe also mentioned the Chesterfield Mall, which The Staenberg Group is currently working on a master plan to convert the property into an urban downtown development. The plan includes housing, office, retail, and restaurants, and is scheduled to be completed and presented to the city by the end of the year.

Tegethoff also shared his vision for the existing Wildhorse project and Wildhorse Village. Wildhorse has scheduled openings throughout 2021, including the 188-residential spaces in March and the AC Hotel by Marriott in December. The notable, 15,000-SF Ruth Chris Steak House opens in two-weeks.

Wildhorse Village, an 80-acre development to include 1 million SF of office space, more than 500-residential units and 100,000 SF of restaurant and retail space, is currently underway. The project will not be phased and anticipates openings as early as 2023.

“We never really thought about phasing Wildhorse Villiage. The momentum of early interest in the sub lots enabled us to do it all at one time,” Tegethoff said.

“We feel like there has never been a more exciting time to developing in Chesterfield.” Tegethoff said.

Despite the challenges of 2020, the city of Chesterfield is on the rise.

to view the entire program, please visit CCIM St. Louis’s LinkedIn page.

Forsyth Pointe construction kicks off in Clayton

Construction of Forsyth Pointe, a mixed-use development in the central business district of Clayton, Mo., is underway.

The US Capital Development project includes two Class-A office towers, street-level retail and connected parking and will add nearly 1 million SF of prime space in the heart of Clayton, Mo.

As construction manager, McCarthy Building Companies is overseeing all construction work, including the delivery of self-perform concrete services on the cast-in-place building foundations, elevator cores and parking structure. The steel-framed glass structures will rest atop a post-tensioned concrete-framed parking structure.

“Forsyth Pointe will be a wonderful addition to the Clayton skyline and community,” said Michelle Harris, Mayor of the City of Clayton.

The 10-story, 265,000-SF east tower will occupy the corner of Forsyth Blvd. and Meramec Ave. And the 8-story, 210,000-SF west tower will reside at Brentwood Blvd. and Forsyth Blvd. More than 20,000 SF of street-level retail space will enliven the development’s street presence.

“The development will add prime office space and innovative retail space, increasing street vitality and the pedestrian experience on a prominent corner across from Shaw Park—one of our city’s crown jewels," Mayor Harris said.

A 7-level parking structure will connect both buildings and extend 2.5 levels underground. At the top level of the parking structure, a 45,000-SF open-air garden terrace will serve as a signature amenity and be available for public events.

Other planned amenities include a 10,000-SF fitness center and a ground-floor arts and entertainment venue.

“We’re honored to partner with US Capital Development and the design team to bring this incredible new development to life in one of the most desirable locations in St. Louis County,” said Jared Hites, vice president of operations at McCarthy.

From the project’s early design phase, McCarthy initiated an integrated virtual design and construction (VDC) process with the owner, designer and trade partners to drive efficiencies throughout the project. This includes the use of cloud-based building information modeling (BIM) collaboration platforms accessible by all team members.

Specific VDC applications include model-based design review, model-based field layout, 3D building systems coordination, laser scanning of as-built conditions and aerial drone photogrammetry to monitor and survey construction progress.

Forsythe Pointe is designed by Christner Architects (design architect, architect of record and landscape architect) and CEDERGREEN, LLC (design architect).

Other team members include Alper Audi (structural engineering), Stock & Associates (civil engineering), G&W Engineering (mechanical, electrical and plumbing engineering) and Randy Burkett Lighting Design (lighting design).

The project is expected to be complete in summer 2022.  

CRE project designs 'on point' for future

The evolution of commercial building design over the last few years to include more open space, rich amenities, safety and tech-driven concepts is proving to be a well-thought-out and timely choice, especially when considering the current and future demands and regulations resulting from COVID-19.

Building spaces, notably office and other shared spaces, are in the spotlight now more than ever before, prompting the focus of discussion for the St. Louis CCIM virtual meeting last week.

Tony Kennedy with Colliers International, moderated the meeting; panelists included Larry Chapman, president and CEO of Seneca Commercial Real Estate; Korey Baker, associate director of market development for Compstak; Toby Heddinghaus, president of Gray Design Group; Scott Haley, managing director of US Capital Development and Tim Gaidus, senior project designer at HOK.

“When Seneca embarked on the Edge series of buildings, the focus was on creating an environment that employees want to be a part of, which in turn, helps the companies that become our tenants compete successfully for, and to be able to retain the best and brightest talent. These designs easily adapt to the changing demands of the occupants and are highly compatible with the new COVID-19 paradigm,” said Chapman.

Edge at West Park, located just west of the I-270/Olive Blvd. interchange, provides a flexible, employee-centric environment which maximizes the building’s common areas to provide amenities critical to helping companies recruit and retain the best talent, regardless of market conditions. FM Global, a worldwide insurance company based at Maryville Centre Office Park, is set to move into the top floor of the four-story building in November.

“Edge at West and Forsyth Pointe are two of the more prominent office developments planned in St. Louis County right now. With some uncertainty in the market surrounding COVID-19, it's refreshing to see these projects advancing on schedule. I'm very confident that US Capital Development and Seneca will deliver top quality buildings to the market that adapt to the needs of the users, both in terms of the current pandemic and also their long- term ability to recruit and retain top tier talent, “ said Jim Loft, president of St. Louis CCIM and executive vice president of Gershman Commercial Real Estate.

The recently completed EDGE@BRDG (BioResearch & Development Growth) Park, an innovative 160,000 SF, four-story lab and office building on the Donald Danforth Plant Science Center campus in Creve Coeur, Mo., is now finished and its first lead tenant, Benson Hill Biosystems, one of the fastest growing leaders in the field of plant sciences, has just moved in.

Forsyth Pointe, located on Forsyth Blvd. between Brentwood Blvd. and Meramec Ave., consists of two towers totalling nearly 1million SF of space, half of which will be dedicated for office use and the other half to a 1,250-spot garage. The west tower is slated to have 202,054 SF of space across 14 floors and the east tower to have 255,114 SF of space across 16 floors, two floors of which will be for the underground parking garage. Over 24,000 SF of retail is planned.

Other forward- thinking design elements mentioned that are currently being implemented in building design include:

• Walkable environments- fresh air spaces with plenty of distance

• Wide open staircases

• Refuge areas

• Phone booths

• Huddle rooms

• Roll up (garage) doors

• Touchless automatic door opening

• Restroom doors with no handles

• Plasma filtered air

• More robust cleaning services

• Anti-microbial coatings

• Hand sanitizer stations

• Biometrics instead of touchpoint

• Robotics and automation

• Holograms/virtual reality

The next St. Louis CCIM event is scheduled for September 15th from 11:15 am - 1:00 pm at the St. Louis Club in Clayton, Mo. For more info, please visit https://ccimstl.com/events/.

City Foundry STL gears up for debut, despite official opening date

St. Louis' $220 million mixed-used development, City Foundry STL, is gearing up for their highly-anticipated debut, despite an official opening date.

The 15-acre site includes 122,000 SF of food hall and public market space, 107,000 SF of creative office space and 105,000 SF of retail shops - all rolled into its own midtown destination on Forest Park Ave between Vandeventer and Spring streets.

Steve Smith, CEO of the Lawrence Group, the property's developer, has reinvented the former Century Electric site with inspiration from similar developments - like Chelsea Market in New York City and Krog Street Market in Atlanta. 

Unlike a typical outdoor mall, the majority of vendors in the development are independently-owned, small businesses - as well as a few emerging concepts new to St. Louis - who will make their debut in the nearly 100-year-old foundry structure. The food hall and public market will bring together more than twenty different local chefs, each with their own unique-food-concept "mini restaurants,” as well as the other vendors in the food space.

The collective City Foundry STL team sees the public market as an opportunity to give local chefs, restaurateurs, artisans and more a platform to rebuild from COVID-19.

“Our local hospitality industry defines the current culture and uniqueness of our city. It’s also the most vulnerable during this time. Our hope is that City Foundry can be a place for ideas to incubate and grow into a viable business; a place where new concepts will be surrounded by industry leaders to learn from and succeed,” said City Foundry STL asset manager, Will Smith.

Anchor tenants include grocery store Fresh Thyme Farmers Market and Alamo Drafthouse Cinema, which marks its first metro area location.

Other tenants include: 18Rails|The Venue @City Foundry STL, Buenos Aires Cafe, Bullhorn, City Taco Shack, Fassler Hall, Gateway Blend, Good Day, Great Rivers Greenway, Hello Poke, Orion Genomics, Press Waffle Company and Punch Bowl Social.

An on-site hiking-and-biking trail connecting Forest Park to downtown St. Louis is in the works via Great Rivers Greenway, the sponsoring regional agency. Free parking will also be available, with over 1,000 parking spaces on site.

City Foundry STL continues to progress on construction of the overall development. An exact opening timeline will be determined and announced soon, based on recommendations from health officials as well as the comfort level of future customers.

Prospective tenant interest has returned to pre-covid levels, according to the development team, with 95% of office space leased and 65% of the development pre-leased overall.

For more information on leasing, please contact Rob Soete at rob@cityfoundrystl.com.