Courtesy of Patrick Ross This is one of the spaces Cross Street Partners redeveloped as part of its $96.5 million American Tobacco campus project in Durham, North Carolina. The mixed-use project, which was completed in 2006, includes space for office, residential and higher education use.
Sunday, February 19, 2017 10:05 pm
Developer in 'love' with city, site
Sherry Slater | The Journal Gazette
Joshua Parker remembers the first time he visited Fort Wayne as an almost magical experience.
It was 2015, two days after Christmas.
"There was not a cloud in the sky, and it was snowing. However that works," he said.
During his Summit City tour, Parker realized he was smitten. "I think falling in love is really the right term," he said during a recent interview.
Parker’s firm, Cross Street Partners, was selected by General Electric Co. to buy and develop GE’s vacant and crumbling local complex, officials announced last week. The ambitious redevelopment plan could cost $300 million.
GE officials wanted to solicit proposals and choose a sound plan by an experienced developer. The winner traces its origin to a firm that foundered and closed during the Great Recession, leaving behind lawsuits and millions in unpaid bills.
The final sales contract hasn’t been signed, but the parties expect to work out details in coming weeks and ink the deal this summer for what’s being referred to as Fort Wayne Electric Works.
Although Cross Street has never tackled such an ambitious project, the firm’s partners have previous experience in some big-time development deals, including a portion of the American Tobacco Campus in Durham, North Carolina.
"This is Durham 10 years ago," Parker said of Fort Wayne’s potential. "It was like, ‘Wow. This place is really taking itself seriously.’ "
Showing our assets
Eric Doden, Greater Fort Wayne Inc.’s CEO, was Parker’s tour guide that sunny-snowy December day.
As head of the organization that coordinates economic development deals for the city and Allen County, Doden leads personal tours three or four times a month. He doesn’t remember what, exactly, he showed Parker.
But similar tours, Doden said, have focused on downtown construction including Ash Skyline Plaza, Randall Lofts and Cityscape Flats; restaurants including Tolon, The Golden and The Hoppy Gnome; and planned development sites including the riverfront promenade, the downtown arena and STEAM park.
The tours typically include excursions into neighborhoods to add even more local flavor, Doden said.
Parker’s visit undoubtedly included a visit to the 17 decaying buildings that make up GE’s formerly bustling campus that attracted 10,000 workers daily when it was a U.S. defense contractor during World War II.
The 31-acre property straddles Broadway near Taylor Street. It doesn’t fall within the official boundaries of the Downtown Improvement District, but Doden considers the site part of downtown.
Although the details of Dec. 27, 2015, are hazy, Doden remembers being impressed by Parker – his energy, vision and passion – during the developer’s numerous visits to northeast Indiana.
Casey Steinbacher, former president and CEO of the Greater Durham Chamber of Commerce, is also impressed by Parker. She’s the one who suggested he should contact Doden to explore a potential project.
"He’s very thoughtful, very smart, really easy to get to know, very personable," she said about Parker. "And whatever project he works on, he’s very engaged in."
Parker, who started his development career in Durham, also makes time to serve on various boards and committees there.
"He has been an active, active citizen here, probably from the time he could walk," Steinbacher said, laughing.
Parker was development manager for West Village, a 600,000-square-foot, mostly residential project within walking distance of the Duke University campus. Then he was principal sponsor of The Chesterfield, a 350,000-square-foot, all-commercial project in Durham.
The projects contributed to what’s been described as the successful revival of downtown Durham. But Parker doesn’t want to follow that template, which includes a man-made river snaking through downtown.
"I think Fort Wayne," he said, "has a lot of assets Durham doesn’t have."
From the ashes
Parker, a Cross Street partner and principal, has worked in development for 15 years.
The 33-year-old Durham native still lives in his hometown. The travel-intensive nature of his job doesn’t require him to be in Baltimore full time, he said. And by staying in North Carolina, he is able to spend more time with his 4-year-old daughter. He shares custody equally with his ex-wife.
He joined the Baltimore firm in 2015, five years after it was founded on the ashes of the former Struever Bros. Eccles & Rouse, a development firm that adapted more than 20 million square feet of historic property for reuse.
The GE site includes about 1.2 million square feet of usable space inside the buildings.
Struever Bros. went out of business in 2009 amid a string of lawsuits for unpaid materials and contract labor, according to reports by the (Baltimore) Sun. The firm didn’t file for bankruptcy protection, however, instead choosing to renegotiate some debt on its own, the Sun reported.
Some creditors contacted by the Sun in 2011 said they’d be willing to work with the former firm’s officials, however, because the recession hobbled most construction and development firms.
Bill Struever, Cross Street’s CEO, partner and principal, was a founder of that firm. He’s been working in development since 1974. He brings decades of experience that Parker lacks.
Struever is "one of the most visionary guys in the industry," Parker said. "He’s able to see things other people don’t see."
That includes minute details and big-picture trends, Parker said.
Struever also is willing to bet on unassuming upstarts.
Parker likes to tell the story of Struever’s role in developing Baltimore’s Inner Harbor, which included leasing. At the time, a small startup with two dozen workers wanted space but couldn’t get approved. Struever believed in the company, so he guaranteed its lease.
That was 14 years ago. Today, Under Armour employs 14,000 worldwide, including 1,500 in that Baltimore building, and sells sports apparel by the barrel.
Parker sees the same potential to nurture startup companies on the local GE campus.
During the project’s formal unveiling last week, he echoed the current economic development philosophy that growing an economy requires attracting talented workers instead of just landing a major manufacturer to build a new factory.
Job creation generated by the development, Parker said, "will happen a few at a time. It will happen with people who choose to be in Fort Wayne."
Young, talented workers aren’t the only ones being drawn in. Cross Street plans to make a long-term commitment to the local GE property.
Parker said his partners plan to hold onto their portion of the development for years and encourage others to do the same.
"We really try to find partners that are in it for the long term," he said.
When a partner has to cash out, Cross Street tries to find another investor to take its place, Parker said.
The desire to make a long-term commitment was one factor that led the Downtown Development Trust to choose The Model Group of Cincinnati to redevelop The Landing. The community benefits when developers make a long-term commitment to a project’s success, trust officials have said.
Cross Street’s goal, Parker said, is to create such a solid financial package that when the next economic downturn hits, the firm will have the flexibility to temporarily lower a tenant’s rent, for example.
Parker has developed lasting relationships with the communities he has worked in and the people who live there. That includes, he said, following the results of local elections and high school tournaments.
Parker said he wants to create a development legacy that his daughter will be proud of someday.
Parker isn’t intimidated by the expansive GE campus redevelopment for at least a couple of reasons. One, of course, is his partner’s extensive experience.
Two other firms are also partnering with Cross Street on the project: Decatur firm Biggs Development, headed by Kevan Biggs, and Indianapolis firm Greenstreet Limited. Jeff Kingsbury, Greenstreet’s managing principal, is a Fort Wayne native.
But another reason for Parker’s confidence is the enthusiastic reception he received from Greater Fort Wayne’s Doden, Mayor Tom Henry, Gov. Eric Holcomb and local business owners Tim Ash, Scott Glaze and Chuck Surack.
Doden has called on even more people to support the project.
"We can’t do something of this magnitude without the complete team effort of this community," he said during last week’s announcement, which included a call for residents’ input.
Experts estimate any redevelopment will be functional for about 40 years. This particular one is estimated to attract 500,000 visitors annually.
That adds up to 20 million people, a number that motivated Doden on days when he thought he couldn’t summon the energy to pick up the phone and place yet another call about the site.
Told that Parker was enchanted by the city during his first visit, Doden didn’t seem surprised.
"It is kind of magical," he said of Fort Wayne. "And it’s growing more magical."