A Mixed-Use Vertical Village Revives a Retail Ruin in Memphis

In 1927, Sears, Roebuck & Company opened a distribution center and retail location in the Crosstown neighborhood of Memphis. As business boomed, the footprint more than doubled in size over the next 40 years. After a nearly three-decade decline that hastened decay in Crosstown, the 1.5 million-square-foot (139,400 sq m) building finally closed in 1993, sitting behind a chain link and barbed wire fence for years.

In the last year, the now-historic brick-and-cast-stone behemoth is anchoring a renewal of this part of Memphis. Known as Crosstown Concourse, the ten-story “vertical village” mixed-use project opened in 2017, following a $200 million redevelopment that took seven years of planning, fund raising, demolition, and construction. Health companies, artists, a high school, educational organizations, retailers, and restaurants occupy virtually all of the commercial space, while residents fill 265 apartments spread across the upper four floors. Between employees, residents, students, and customers, 2,000 to 3,000 people frequent the 1.1 million-square-foot (102,200 sq m) Crosstown Concourse on any given day.

“Crosstown Concourse has really become the most significant part of Memphis in terms of activity at the moment,” says Alan Boniface, a principal with the North American design firm DIALOG and a ULI full member, who was involved in the effort to reuse Crosstown Concourse. “It is a meeting place for all walks of life.”

Rather than simply paying rent in return for space to serve customers, more than 40 commercial tenants in Crosstown Concourse are pursuing a collaborative mission to become “better together”—a mantra that is cited often in the building’s redevelopment story. It’s a vision that started with Todd Richardson and Christopher Miner, founders of Crosstown Arts, an organization focused on cultivating the creative community in Memphis. They believed that by moving their group into the building, they could rebuild the neighborhood.

Yet, as an art history professor at the University of Memphis, Richardson acknowledges that he may have underestimated the difficulty of selling the idea given the building’s size and the amount of money needed to fix it up, especially in a depressed real estate market.

“We didn’t give ourselves much of a chance for success,” he said. “If you look at the building as just space to be filled, where do you start? It’s the size of 25 football fields.

“But we began thinking about using the building to create a great neighborhood and all the things that make up a great neighborhood. Then we were asking, ‘Do we have enough space?’”

The rebirth of Crosstown Concourse began in 2010. At that time, local investment manager and entrepreneur Staley Cates owned the property after quietly acquiring it in 2007. He had anticipated moving a small private college into the building, but the Great Recession derailed the plan. When Crosstown Arts founders approached Cates about moving their group into the building to spark the creation of an urban vertical village, he agreed to fund a feasibility study.

The idea of creating collaborative spaces where all occupants are expected to contribute to the broader community is not a new concept, Boniface says, but it is becoming more widespread in the United States as urban neighborhoods are rediscovered. In Crosstown, the challenge was convincing people who assess real estate deals on a fundamental level to buy into the notion, says Frank Ricks, a principal with Memphis architecture firm Looney Ricks Kiss, which also worked on the project.

“When I first met Todd and Chris, I told them I didn’t know how they were going to make the numbers work,” Ricks says. “But to their credit, they wouldn’t quit. They don’t play in the real estate world and kind of defied logic. That’s probably what made success possible.”

The effort to pull together a plan entailed hundreds of meetings with neighbors, civic leaders, and institutions. A significant breakthrough came after Richardson met with Dr. G. Scott Morris, founder and CEO of Memphis-based Church Health, which provides health care to some 70,000 low-income workers who lack insurance.

Initially, Richardson asked Morris if he would set up a clinic in the building to serve artists. Although Morris didn’t consider the idea financially viable, it nevertheless intrigued him along with the mission to be “better together.” Church Health services were spread over 13 buildings throughout Memphis, and he wanted to consolidate under one roof.

“We had to become more efficient and find ways to better care for people in a holistic approach,” says Morris, who is an ordained minister in the United Methodist Church. “When I chewed on how the financing could possibly work, I could see how there was a path to get there.”

Church Health eventually invested $40 million and leased 150,000 square feet (13,900 sq m). But more immediately, Morris joined Richardson in the recruitment of additional organizations focused on health, arts, and education. Six more groups ultimately signed up, including St. Jude Children’s Research Hospital, Memphis Teacher Residency, and Crosstown High School.

Together with Crosstown Arts and Church Health, they became the building’s eight foundational partners and over time raised $200 million from 32 different sources. Meanwhile, the planning process included a tour of Midtown Exchange, a near carbon copy of the Sears distribution edifice in Minneapolis that had been redeveloped into a mixed-use structure, and intensive design sessions.

“For over a year, we worked through how each partner might interact with the others and public spaces by talking about their business models and the resources they would bring,” says Tony Pellicciotti, a principal with Looney Ricks Kiss. “While we talked about their physical needs, they were really secondary to the community we were building.”

Developers and designers held workshops to figure out how to dissect the building to foster connections between people in the corridors and public spaces. But because of its landmark designation, they could not alter the exterior, Boniface says. As a result, they converted the former loading dock on the building’s south side into a continuous front door and retail walkway. To bring in natural light and foster connections between people roaming the corridors and public spaces, the developers cut out numerous floors throughout the building, creating three large atriums and four smaller ones. That and the demolition of a one-story addition wrapped around a rail spur helped reduce the amount of square footage to fill.

In addition, elements such as green and red stairways that draw on the old Sears chute conveyor system were incorporated to entice the public into various parts of the project, Boniface adds. The building includes underground parking, and developers fixed up a 1,150-car garage across the street. Crosstown Concourse also earned a Leadership in Energy and Environmental Design (LEED) Platinum designation for historic adaptive use and is believed to be the largest project of the kind to earn that distinction.

More important is the influence that the development has had on the Crosstown neighborhood, which is where Richardson, Franks, and Pellicciotti live. Residential development has picked up in the area, and shuttered commercial buildings are coming back to life, Richardson says.

“An abandoned and blighted building for 20 years doesn’t do much for property values,” he says. “But now it’s full of stuff, and people want to be part of it.”