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Southgate Center

Project Number: 20180602
Project Type: Community Builder
Parcel ID: 050056 00002
County Commission District: 10 | City Council District: 06, 08

Summary

Southgate Center developers, Union Realty Company General Partnership, was awarded a 15-year Community Builder PILOT to redevelop a 208,297 square foot shopping center at 1897 South Third Street.

The recent departure of two major food and retail anchor tenants has left the property is suffering from 39% vacancy. The developer proposes to renovate the center and lease the vacant 31,000 square foot grocery store to a new operator with substantial supermarket experience. Following the grocery store lease, the developer will recruit two junior anchor tenants and fill five small retail shops.

The $6,802,200 investment into the property includes exterior upgrades, tenant finishes and grocery store equipment. This investment will create 47 full-time grocery store positions and 60 part-time retail positions in adjacent space. This will equate to 92 Full-Time-Equivalent jobs at an average annual wage of $24,960.

More than 55,000 people live within a three-mile radius with median household incomes of $34,600. The project’s Census Tract is severely distressed with a 52% poverty rate and 32% unemployment rate. Financial assistance is needed to provide healthy food options to the neighborhood, remove blight, complete renovation of the building, create jobs and improve the overall neighborhood quality of life consistent with the Community Builder PILOT policies.

The project is supported by the South Memphis Alliance. EDGE Staff projects $4,524,365 in local total tax revenues to be received during the PILOT term of this project and a $1,159,291 benefit to the Union Realty Company General Partnership.

PILOT Term:

15

Projected New Jobs:

92

Projected Retained Jobs:

Not applicable

Total Jobs:

92

Projected Average Payroll of New Jobs:

$24,960

Projected Average Payroll of Retained Jobs:

Not applicable

Annual New Direct/Indirect Payroll:

Not applicable

Annual Retained Direct/Indirect Payroll:

Not applicable

Total Capital Investment:

$6,802,200
Real Property Investment:
$1,000,000

Personal Property Investment:
$300,000

Community Reinvestment Credit (CRC):
$4,252,200

Capital Investment not in PILOT:
$1,250,000

Projected Tax Revenue:

$4,524,365

Projected Taxes Abated:

$1,159,291
City: $506,610 (75%)
County: $652,681 (75%)

Benefit/Cost Ratio:

3.90

Projected MWBE/LOSB Spending:

$423,894

Incentive Provided:

$1,159,291

Compliance Information

Not applicable

Approved

6/20/2018

Ramp up Period

1

Closing

Not applicable

Effective

Not applicable

Lease Begins

Not applicable

Lease Expires

Not applicable

Amended

Not applicable

Property Details

Lease Began

Not applicable

Lease Expires

Not applicable

Southgate Center

1897 South Third Street, Memphis, TN 38109