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Birmingham Building Boom

Downtown development is a bright spot in real estate nationally — nowhere better expressed than Birmingham, with 32 downtown projects under construction or recently completed, totaling $728 million.

REV Birmingham CEO David Fleming (right) meets with Brian Beshzara, one of the investors in the Thomas Jefferson Tower renovation project. The $21 million project will adapt the historic structure for mixed commercial and residential use.

REV Birmingham CEO David Fleming (right) meets with Brian Beshzara, one of the investors in the Thomas Jefferson Tower renovation project. The $21 million project will adapt the historic structure for mixed commercial and residential use.

The magic is back. Birmingham is booming — uptown, midtown, downtown. New buildings are going up. Old buildings are being restored. A new energy, a new confidence sweeps through the streets, not like anything this old town has seen, possibly, since the start of the 20th century when unprecedented growth first inspired people to call it the Magic City. 

Scaffolding is the new facade for many old buildings that until recently sat dark and empty. That raucous rat-a-tat-tat of jackhammers is actually music to the ears of folks who have long called for this renaissance, and David Fleming, CEO of REV Birmingham, likes the sound of that tune.

“It might look like all this construction happened overnight,” says Fleming, “but it really didn’t. The seeds were beginning to take shape even 20 to 25 years ago with the loft district on Second Avenue North. Then, the opening of Railroad Park all of a sudden gave us the large civic space that a lot of cities enjoy having. And Regions Field came on the heels of that. All of a sudden you had between 400,000 and 600,000 people coming downtown. I don’t think there’s any question that this was a major catalyst in changing people’s attitudes, minds and desires to invest in the downtown area.” 

Those investments currently include 32 projects already under construction or recently completed, totaling $728 million. More than $200 million of that is slated for the restoration of some of Birmingham’s most historic buildings. Most all the construction includes office and retail space, as well more than 1,600 residential units. According to Fleming, Birmingham’s downtown residential growth has increased 36 percent since 2000. “This has caused developers to recognize the potential and the need to develop more places for people to live. But, beyond that,” he adds, “there are national trends that Birmingham is certainly a part of. The younger generation, as well as some older generation, the empty nesters, are moving back into the city because they want more of that city community lifestyle.” 

Under construction across from the site of the downtown Publix is phase one of 20 Midtown, a mixed-use development with 36 apartments and 9,200 square feet of retail space.

 

That lifestyle is bringing a new look to Birmingham. Gone are the big department stores of the ’60s and ’70s, replaced by smaller retail establishments. Fewer downtown employees are headed to their cars after work for that commute home to the suburbs. Likely as not, they’re walking or riding their bikes. And, for the first time ever, a major supermarket is going up downtown.

“We’ve had some small food stores before,” says Fleming, “but never a major chain. The fact that a major chain like Publix sees this as a market they should come into is a real vote of confidence. A company like Publix doesn’t make a decision like that randomly.”

That’s a fact developers Dick Schmalz and his partner Scott Bryant know only too well. It took the contractors seven years and three requests to the Publix real estate committee before they finally got the nod to go ahead. Work is now under way on a new Publix at the corner of 20th Street and 3rd Avenue North, in the old Firestone building and adjacent property. Slated for completion in the fall of 2016, the new store won’t bear a lot of resemblance to its suburban neighbors. “For one thing,” says Schmalz, “parking will be on top of the building, and on top of the parking will be 86 apartments.”

“We were very happy to say the least,” says Schmalz. “We’d waited a long time to get the go ahead. The reason it took the supermarket chain so long to approve the building was really fairly simple. Grocery stores depend upon full-time residents being the staple of their market, and, until recently, the number of residents in that Midtown/Downtown area had not reached a point to give the supermarket a level of comfort in locating down there. There’s always been a number of what they call the daytime population,” explained Schmalz, “employees who work in the area, but grocery stores have never really been able to quantify what that would mean to their business. Their staple is full-time residents, and that has risen to an appropriate level. Publix now feels like when you factor in that, plus the additional expected growth, there is certainly enough market to support their store.”

It’s that “expected” growth and the seeming glut of downtown apartments now being built that have naysayers wondering if Birmingham is over-extending.  

“Not so,” says David Silverstein, whose company, Bayer Properties, is onboard to refurbish one of the city’s icons, the Pizitz Building. Plans for that stately old lady’s $66 million redevelopment include mezzanine office space and ground-level retail, as well as 143 multifamily units. 

“Sure,” says Silverstein, “there is always a risk of overbuilding, but right now we have such a demand that as soon as residential units are brought on line they are absorbed. There is a demand for residential, so I don’t think we’re approaching the tipping point. In fact, I think this trend will continue over the next five years with even more residences being built.”

Bayer Properties bought the Pizitz building 10 years ago. “For several years, we worked on a plan to convert it to office space with retail on the ground floor,” says Silverman, “but that was at the beginning of the downturn in economy in ’08 and ’09. The timing wasn’t appropriate. But, I have to say, I think we’re even more excited about our plans now, because it will be bringing people back downtown to live and work and shop.”

Alabama Power’s old Powell Steam Plant is another of Birmingham’s iconic buildings slated for a complete overhaul. Built in 1895, it is one of the city’s oldest and most historic. The plant provided power for downtown, including the city’s streetcar system. It was decommissioned in 2013 after more than 100 years of service.

According to Alabama Power spokesperson Michael Sznajderman, “we have begun a very deliberate process to determine what will be the best use for this facility, which provided energy to this community for so many years. Now we want to continue to a new kind of energy, as part of this newly energized, revitalized, growing downtown Birmingham.”

Although Sznajderman says at this point “nothing is etched in stone,” the company is most likely headed toward a mixed-use facility. That would likely include elements like restaurants or taverns and “very possibly some kind of cultural/entertainment venue or theatre space, kind of depending upon what the need is in the community,” says Sznajderman.

To date, workers have concentrated on cleaning and stabilizing the 80,000-square-foot facility. Sznajderman says they’ve opened up the slots where historic windows used to be and stabilized the chimneys, removed all the old industrial equipment and leveled the floors.

“We view this as a significant project,” says Sznajderman, “an economic catalyst that will help take that area of downtown, which is already going through a renaissance, to the next level, that will fuel further economic development.” 

Signs of that renaissance are everywhere, and when Fleming strolls through downtown these days, he’s gratified at what he sees and hears. “People are really fired up about the city. They’re really excited. I love Birmingham. I grew up here, and, for so long, I felt like people had a very negative view of the city and even we ourselves had an inferiority complex. I think that’s changing. A vibrant city happens because a lot of different people are doing different things, and that’s what is happening here. People are seeing the potential of Birmingham. We can be one of the most valuable marketplaces in the Southeast and recognized as such. We need to believe in that, act like we believe in our city and in ourselves.”

Birmingham Boom’s Biggest Projects

1. Pizitz Building

Estimated Project Cost: $67 million
Location: 19th Street North
Mixed Use: (Residential / Commercial); 143 residential units; 11,000 sq. ft. office; 23,000 sq. ft. retail; 251,210 sq. ft. total
Owner: Bayer Properties, Birmingham; Stonehenge Capital, Baton Rouge; Wisznia Architecture & Development, New Orleans
General Contractor: Brasfield & Gorrie
Design Firm: Wisznia Architecture, New Orleans; KPS Group, Birmingham
Under Construction
Estimate Completion:
Fall, 2016

2. Veterans Affairs Clinic 

Estimated Project Cost: $60 million
Location: Lakeview District
Medical Office; 70,000 sq. ft.
Owners: Graham & Company, Birmingham; The Molasky Group of Companies, Las Vegas
General Contractor: B.L. Harbert International
Design Firm: Page Southerland Page, Dallas
Under Construction 
Estimate Completion: December, 2015

 

 




3. Empire Hotel 

Estimated Project Cost: $60 million
Location: Downtown
Hotel; Autograph Collection by Marriott
Owner: Ascent-Hospitality, Buford, Georgia
General Contractor: NA
Design Firm: NA
Announced in April
Estimate Completion:
NA
 


4. Highland Tower

Estimated Project Cost: $53 million
Location: Highlands District
Mixed Use: (Residential / Commercial)
Owner: Harbert Realty Services, Birmingham
General Contractor: Brasfield & Gorrie, Birmingham
Design Firm: Smallwood, Reynolds, Stewart, Stewart & Associates, Atlanta
Under Construction 
Estimate Completion:
Fall, 2016

5. Metropolitan Apartments 

Estimated Project Cost: $40 million
Location: Lakeview District
Mixed Use: (Residential / Commercial) 
Owner: Bomasada Birmingham LLC, Houston
General Contractor: NA
Design Firm: Lord Aeck Sargeant, Atlanta
Design Approved
Estimate Completion:
Spring, 2017

6. The Venue at the Ballpark 

Estimated Project Cost: $39 million
Location: Parkside District
Multi-family: 236 units 
Owner: Cityville Venue at the Ballpark LLC, Oak Brook, Illinois
Developer: Inland American Communities, Dallas; Corporate Realty, Birmingham
General Contractor: Golden Construction, Birmingham
Design Firm: BOKA Powell, Dallas
Under Construction
Estimate Completion:
Spring, 2016

7. UAB Student Center 

Estimated Project Cost: $35 million
Location: Southside District
159,000 sq. ft.
Owner: UAB
General Contractor: Doster Construction Co.
Design Firms: Herrington Architects, Birmingham; Hastings & Chivetta, Birmingham
Under Construction
Estimate Completion:
Fall, 2015

8. U.S. Treasury Building 

Estimated Project Cost: $33 million
Location: Downtown District
Office Building, 87,786 sq. ft.
Owner: CRD USTB LLC, Birmingham
General Contractor: Brasfield & Gorrie
Design Firm: KPS Group
Recently Completed

9. Birmingham Intermodal Facility

Estimated Project Cost: $30 million
Location: 19th Street North
City Transportation Terminal
Owner: City of Birmingham
General Contractor: Tyler-Miree Construction, Birmingham
Design Firm: Giattina Aycock Architecture Studio, Birmingham 
Under Construction
Estimate Completion:
Spring, 2016

10. Liv Parkside 

Estimated Project Cost: $30 million
Location: Parkside District
Mixed Use: (Residential / Commercial)
Owner: Parkside Residences LLC
General Contractor: Hoar Construction
Design Firms: Charlan Brock & Associates, Birmingham; Nimrod Long and Associates, Birmingham
Under Construction 
Estimate Completion: September, 2015

11. Publix at 20 Midtown

Estimated Project Cost: $30 million
Location: Parkside District
Mixed Use: 33,000-sq.-ft. Publix grocery; 36 apartment units
Owners: RSG Properties, Birmingham; Scott Bryant & Co., Birmingham
General Contractor: Publix, Lakeland, Fla.
Design Firm: Cohen Carnaggio Reynolds, Birmingham
Under Construction
Estimate Completion:
Fall, 2016

Linda Long and Joe De Sciose are freelance contributors to Business Alabama. Both are based in Birmingham.

Old to new | New to old
Jun 12, 2015 06:24 am
 Posted by  J. Clark

What about 20/59 and the northside? Out of site out of mind?

watch rethink 20/59.
https://www.youtube.com/watch?v=qeoKt5HBYbw

Let's prepare Birmingham to compete for the next 50 years.

Jun 17, 2015 10:10 pm
 Posted by  ForgedByFusion

$30MM Redmont Hotel brings first Curio by Hilton to Alabama: http://www.redmontbirmingham.com/#about

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