WilmingtonBiz Magazine - 2018 Commercial Real Estate Issue

Wilmington B iz 2 0 1 8 c o m m e r c i a l r e a l e s tat e i s s u e

M A G A Z I N E

growth spurt Cape Fear ’s major developments taking shape TOP TRENDS TO WATCH

MEET THE DEALMAKERS

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Greater Wilmington

BUSINESS JOURNAL

Live Oak Bank’s expansion

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1430 COMMONWEALTH DRIVE I SUITE 102 I WILMINGTON, NC 28403 I 910.350.1200

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LETTER FROM THE EDITOR BEHIND THE NUMBERS SOUND OFF NEWS DIGEST THE TAKEAWAY

F E AT U R E S

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COVER STORY: CAPE FEAR REGION'S NEXT CHAPTER REAL ESTATE TRENDS IN PROFILE: TERRY ESPY IN PROFILE: STEVE ANDERSON MARKET SNAPSHOT

ON THE COVER

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RENDERING C/O LS3P

Live Oak Bank continues to expand its Tiburon Drive campus, including this building of a parking deck and fitness center. Employment growth for the company is driving its construction blitz.

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Actionable Information

Wilmington’s Key to Business Intelligence Where the Who’s Who WilminGton B iz 2 0 1 8 c o m m e r c i a l r e a l e s tat e i s s u e

Frame fame

A Wilmington woman is part of the big picture of a framing software firm Page 11

December 1-14, 2017, Vol. 18, No. 25

web

EXCLUSIVE

$2.00

www.wilmingtonbiz.com

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SPECIAL SECTION

Catching many cabs

WOMEN IN BUSINESS

Three taxi companies in Wilmington have a new owner

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December 1-14, 2017, Vol. 18, No. 25

W ILMINGTONB IZ

Frame fame

A Wilmington woman is part of the big picture of a framing software firm

web

EXCLUSIVE

www.wilmingtonbiz.com

$2.00

M ASPECIAL G A Z I N E

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SECTION

Catching many cabs

WOMEN IN BUSINESS

growth spurt

Vol. I

Three taxi companies in Wilmington have a new owner wilmingtonbiz.com

wilmingtonbiz.com

Lending leaps

Lending leaps

Area banks have been increasing their SBA lending

Area banks have been increasing their SBA lending

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Cape Fear ’s major developments taking shape TOP TRENDS

TO WATCH Brewing growth

Brewing growth

Local brewery owners share their journeys, lessons learned

Local brewery owners share their journeys, lessons learned

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MEET THE DEALMAKERS

Page 27

PHOTO BY CHRIS BREHMER

PHOTO BY CHRIS BREHMER

Sound advice: At GE Hitachi Nuclear Energy, Mona Badie (above) is responsible for all information technology systems and processes as well as commercial software, including the company’s industrial internet efforts.

Index

Sound advice: At GE Hitachi Nuclear Energy, Mona Badie (above) is responsible for all information technology systems and processes as well as commercial software, including the company’s industrial internet efforts.

Index

Banking & Finance .............................4-5

Banking & Finance .............................4-5

Health Care ........................................6-7 In Profile ..............................................11

Health Care ........................................6-7

Real Estate .................................... 12-14

In Profile ..............................................11 Real Estate .................................... 12-14

The List ...............................................23

The List ...............................................23

Trend Tracker ........................................27

Trend Tracker ........................................27

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SUBSCRIBE TO THE BUSINESS JOURNAL NOW AT WilmingtonBiz.com/subscribe Your subscription includes: • Unlimited access to stories on WilmingtonBiz.com • Bi-weekly Business Journals mailed to your office or home • The 2018 Book on Business mailed to you

WANDA COLEY

LAUREN HENDERSON

LESSONS IN LEADERSHIP D

BY CHRISTINA HALEY O’NEAL

espite their varied industries, these five women in the Wilmington area helping run organizations, companies and institutions have a lot in common.

Their passions for their various fields – whether it’s in technology, health care, law or politics – have driven their successes and commitments to being lifelong learners.

They recently shared their thoughts on what it takes to be a leader.

OWN YOUR DECISIONS

• At least 20 extra IQ points with your added business knowledge!

SUSI HAMILTON

MONA BADIE, a 13-year GE veteran, is chief information officer and chief digital officer for GE Hitachi Nuclear Energy, a role she assumed in August 2015.

Prior to GE, Badie held various leadership positions at Fitch Risk Management, an arm of Fitch Ratings, and Polaroid.

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OLA LEWIS

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THE BUSINESS JOURNAL’S ANNUAL

WOMEN IN BUSINESS SPECIAL SECTION

WILMA’S LEADERSHIP INSTITUTE 2018 MEMBERS: page 2 HR WEIGHS IN ON THE SEXUAL HARASSMENT CONVERSATION: page 10 IN PROFILE – JEANNETTE KING’S SOFTWARE SUCCESS: page 11

See LEADERS page 8

Your subscription includes: • Unlimited access to stories on WilmingtonBiz.com • Bi-weekly Business Journals mailed to your office or home • The 2018 Book on Business mailed to you

WANDA COLEY

LAUREN HENDERSON

SUSI HAMILTON

LESSONS IN LEADERSHIP D

BY CHRISTINA HALEY O’NEAL

espite their varied industries, these five women in the Wilmington area helping run organizations, companies and institutions have a lot in common.

Their passions for their various fields – whether it’s in technology, health care, law or politics – have driven their successes and commitments to being lifelong learners.

They recently shared their thoughts on what it takes to be a leader.

THE BUSINESS JOURNAL’S ANNUAL

WOMEN IN BUSINESS SPECIAL SECTION

WILMA’S LEADERSHIP INSTITUTE 2018 MEMBERS: page 2

HR WEIGHS IN ON THE SEXUAL HARASSMENT CONVERSATION: page 10 Published by expansion MONA BADIE, a 13-year GE veteran, is chief information officer and chief dig-Live Oak Bank’s IN PROFILE – JEANNETTE Greater WEnergy, ilminGton ital officer for GE Hitachi Nuclear a role she assumed in August 2015.

KING’S SOFTWARE SUCCESS: BUSINESS JOURNAL Prior to GE, Badie held various leadership positions at Fitch Risk Management, page 11 an arm of Fitch Ratings, and Polaroid.

See LEADERS page 8

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PENDER

LETTER FROM THE EDITOR

C E R TA I N REAL-LIFE RETAIL REMAINS ALIVE

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tories about commercial real estate, or even the potential for a new store or development, grab a lot of attention in the Wilmington area.

Local commercial real estate brokers say that despite news about store closures elsewhere and the closure last year of the Kmart store on South College Road, retail space is in high demand, and retail prices per square foot are on the rise in some cases.

The closures these days tend to be retailers that couldn’t or wouldn’t adapt to the way people want to shop now.

It gets a little confusing then when folks lament the number of stores or other commercial projects going up in one area or another and mention traffic as a basis for their concerns. You don’t see many examples of anyone swearing off driving or shopping for all time.

At the same time, there’s no doubt people want to spend less time in their cars when it comes to daily activities, preferring to shop and run errands closer to home or where they work.

There’s also no doubt that e-commerce has changed the way people buy stuff, from clothes to appliances. That trend might be the most evident in looking at many of the new tenants that have opened their doors in recent years at shopping centers throughout the region.

In numerous cases, but not all, these new storefronts have tended to be restaurants or service providers – nail and hair salons, exercise studios, accountants and dentists, for examples.

Or they’re niche retailers – think paint or sporting goods.

Although we seem permanently glued at times to our smartphones and computer screens, there remains a demand for businesses that get us out of our homes and away from the pixels.

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Retail trends could change at some point, but for now, the idea of placing businesses and homes closer together, often through plans for mixeduse projects, is expected to remain a preference where possible for developers, land planners and consumers (see “Trends to Watch,” page 24).

One example of a mixed-use, transformational project is the South Front development by Tribute Companies along South Front, Greenfield and South Third streets, where commercial broker Terry Espy (see profile, page 26) has been working to attract a variety of commercial tenants. Meanwhile, office developer Steve Anderson (see profile, page 28) continues to add class-A office buildings to the Wilmington landscape.

Throughout the region, as more residents come to New Hanover, Brunswick and Pender counties, commercial real estate will keep chasing those rooftops, as it always has.

CECE NUNN , ASSISTANT EDITOR/ REAL ESTATE REPORTER cnunn@wilmingtonbiz.com

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CONTRIBUTORS

M A G A Z I N E

2 0 1 8 R E A L E S TAT E I S S U E – $ 4 . 9 5

Publisher

S U Z I D R A K E SUZI DRAKE is a Wilmington-based graphic artist whose work has appeared in WILMA, Greater Wilmington Business Journal and The State Port Pilot. She is a metalsmith and founder of jewelry brand Whistlepig Workshop. Drake directed and implemented the design and production of the premiere issue of WilmingtonBiz Magazine.

Rob Kaiser

rkaiser@wilmingtonbiz.com

President

Robert Preville rpreville@wilmingtonbiz.com

A s s o c i at e P u b l i s h e r Judy Budd

jbudd@wilmingtonbiz.com

Editor

Vicky Janowski vjanowski@wilmingtonbiz.com

CHRISTINA H A L E Y O ’ N E A L CHRISTINA HALEY O’NEAL is a reporter for the Greater Wilmington Business Journal, covering regional topics such as the local economy, major employers, transportation and film.

She previously reported for Port City Daily, covering crime and courts and general news topics. Haley O’Neal profiled commercial broker Terry Espy in “Point of View" (PAGE 26).

A s s i s ta n t E d i t o r Cece Nunn

cnunn@wilmingtonbiz.com

Reporter

Christina Haley O'Neal chaley@wilmingtonbiz.com

VP of Sales/Business Development Melissa Pressley

mpressley@wilmingtonbiz.com

Senior Account Executive Craig Snow

csnow@wilmingtonbiz.com

Account Executives Polly Holly

pholly@wilmingtonbiz.com

Lynn Murphy

C E C E N U N N CECE NUNN has been writing and editing for more than 20 years, currently working as the assistant editor and real estate reporter for the Greater Wilmington Business Journal. She lives in Wilmington with her husband and two daughters. Nunn details the next major phase of development changes for the area in “A Time to Transform” (PAGE 18), top real estate trends (PAGE 24) and “Office Aficionado” Steve Anderson (PAGE 28).

lmurphy@wilmingtonbiz.com

Business Manager Nancy Proper

nproper@wilmingtonbiz.com

Events Director Maggi Apel

mapel@wilmingtonbiz.com

E v e n t s / D i g i ta l A s s i s ta n t Justine Bledsoe

events@wilmingtonbiz.com

D e s i g n & M e d i a C o o r d i nat o r Molly Jacques

production@wilmingtonbiz.com

MICHAEL C L I N E SPENCER MICHAEL CLINE SPENCER, owner of Michael Cline Photography, is a Wilmington-based freelance photojournalist with over 15 years’ experience working at several prominent North Carolina newspapers. He specializes in corporate, editorial, pet and wedding photography. He photographed this issue’s portrait subjects including Terry Espy (PAGE 26) and Steve Anderson (PAGE 28). michaelclinephoto.com

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Content Marketing Editor Hilary Snow

hsnow@wilmingtonbiz.com

Contributing Designer Suzi Drake

art@wilmingtonbiz.com

C o n t r i b u t i n g P h o t o g r ap h e r s

Chris Brehmer, Katherine Clark, Megan Deitz, Michael Cline Spencer, Terah Wilson

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BizBites BEHIND THE NUMBERS |

THE DIGEST

|

SOUND OFF

PORTERS NECK BUMP

Earlier this year, Jim and Janece Stone (left) opened the 12,000-squarefoot Sugarwood Center, anchored by their own Sugarwood Interiors home furnishings store and other tenants.

The center on Porters Neck Road joins residential projects, a hotel and retailer space proposed for the northeastern corner of New Hanover County.

“The geography just worked for us. We looked all around for about a year,” Janece Stone said about the location.

“We see a lot of development this way.” photo by KATHERINE CLARK

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BEHIND THE

NUMBERS

$ M528 ILLION

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NEW HANOVER

BizBites

BY CHRISTINA HALEY O’NEAL

INVESTMENT IN DOWNTOWN WILMINGTON is on pace to top more than half a billion dollars during the economic recovery, according to Ed Wolverton, president and CEO of Wilmington Downtown Inc.

WILMINGTON

COUNTING UP DOWNTOWN INVESTMENT

PENDER

Adding to the investment are five projects that have broken ground, representing $87.4 million, and seven projects totaling more than $116 million that have been announced, Wolverton said. The largest of these upcoming projects is River Place, an $83.6 million mixed-use development off Water Street, which has broken ground. Another ongoing project is an infill development at 200 Market St., an old parking lot that now is planned to feature restaurant and retail space.

And in terms of the value of taxable property downtown, the city’s central business district grew 32 percent between 2012 and 2017, Wolverton said.

That growth is set to continue in the coming years, he said. Future growth trends downtown could include another wave of downtown’s north side development, renovations or rehabilitation of historic buildings and work on targeted infill projects. Investment is also likely to spill over to infill projects in the Brooklyn Arts and Castle Street Arts and Antique districts, Wolverton said.

“Downtowns across the country are experiencing a significant level of growth, with many factors contributing to that growth, and we expect to see those trends continue,” he said. “The only real cautionary tale is that we only have so much land downtown in terms of undeveloped land. So, at some point, we start running out of land. But we are not there yet.”

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# OF COMMERCIAL PERMITS

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24 $25

35%

BRUNSWICK

The completed, ongoing or announced projects total about $528 million worth of downtown investment in less than a decade.

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OF INDUSTRIAL LAND IS V A C A N T

Other announced projects include Pier 33 apartments, North Waterfront Park and the new Aloft Hotel.

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TO FULL SERVICE CLASS-A OFFICE SPACE AVERAGE PRICE PER SQ FT

Since 2010, there have been 23 major projects completed downtown including residential and commercial structures, as well as public buildings, Wolverton said. Those major projects have totaled $324.3 million, he said.

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RENOVATION

*Number does not include institution or industrial permits or beach towns permits.

COMPLETED & ANNOUNCED CONSTRUCTION PROJECTS IN DOWNTOWN WILMINGTON

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NEW CONSTRUCTION

$848

2017 AVERAGE WEEKLY CONSTRUCTION WAGE Sources: New Hanover County, Bureau of Labor Statistics, CoStar Realty Information Inc., Pender County

AC Marriott

ABC Eagle Award

1712 Eastwood Road, Suite 200 Wilmington, NC 28403 910.679.4551

Building excellence in the Wilmington community

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SOUND OFF

BizBites

THE DAY DOWNTOWN REVIVED

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PENCE BROADHURST’S RE-EMERGENCE IN WILMINGTON REKINDLES MEMORIES OF A BRIGHT DAY IN OUR REGION’S HISTORY – ONE NOW YIELDING SIGNIFICANT RETURNS.

R O B K A I S E R

On that day in 2004, Broadhurst was Wilmington’s relatively new mayor and had a meeting at the home of PPD founder Fred Eshelman.

The idea on the table – PPD consolidating its offices in a sizable, downtown headquarters – had a checkered history.

In 1994, Eshelman thought he’d reached a deal with Wilmington City Council to build a PPD headquarters on the site of the Water Street parking deck.

BROADHURST

ESHELMAN

Then council members began to waffle, floating the idea of PPD issuing a bond for the project. Eshelman told them if they pressed forward with that plan, he’d walk away.

“They pressed it. I walked,” said Eshelman, who instead moved the office to Barclay Centre in midtown. “We had people on city council who were unable to see the future and got hung

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The 2004 meeting between Broadhurst and Eshelman gave the city, PPD and our region’s downtown an opportunity to write a better ending to this story.

The handshake agreement they reached that day led to a series of deals: • PPD sold the city land at its cost for the Wilmington Convention Center.

• The city swapped property where Union Station is now located with Cape Fear Community College for land where PPD now has its parking deck.

• The city steered its Front Street design and contributed infrastructure improvements for PPD’s headquarters, while New Hanover County kicked in other incentives.

“It all happened. It was magical,” said Bill Saffo, Wilmington’s current mayor who was also on city council when these agreements were reached.

“Everyone had a bitter taste in our mouth about what happened 10 years before. We were not going to allow it to happen again.”

The end result – although delayed by the Great Recession – is a massive amount of additional investment.

More than a half-billion dollars in projects have been completed, started or announced in downtown since 2010, said Ed Wolverton, president and CEO

M A G A Z I N E

of Wilmington Downtown Inc. Highlights include: • Residential development such as City Block Apartments (112 units completed), Sawmill Point (280 units completed), River Place (171 units planned) and Pier 33 (286 units announced); • New hotels such as a Courtyard

by Marriott (124 rooms), Hampton Inn (92 rooms) and Embassy Suites (186 rooms) as well the announcements of an Aloft Hotel (120+ rooms) and Hotel Indigo (120+ rooms); and • Public spaces such as the convention center, CFCC’s Wilson Center, Union Station, a completed Riverwalk and the Pier 33 event venue and restaurant.

Wolverton credits elected officials’ “long-term ability to stick with the plan,” specifically the city’s Vision 2020 that was adopted in 2004.

More recent wise moves include the city’s purchase of land near PPD for North Waterfront Park and the property at 1020 N. Front St., the northern entrance to downtown at the end of MLK Jr. Parkway. (One significant whiff was baseball. Imagine adding Atlanta Braves minor league baseball to the list of projects currently underway.)

Downtown – the heart of our community – deserves this outsized attention.

Looking back at the PPD project that started the revival, Eshelman said, “it’s a great example of a public-private deal, which was a win-win deal for everyone.”

It would not have been possible, he noted, without Broadhurst’s “straightforward, no BS” approach.

“He’s a business guy, so he under-

BizBites

CROWDSOURCING REACTIONS, OPINIONS AND QUOTABLES FROM OUR ONLINE SOUNDING BOARDS

O N FA C E B O O K . C O M / W I L M I N GT O N B I Z

Reader comments on Independence Mall’s redevelopment now that it has new owners Rouse Properties, which bought the majority of the struggling mall last year, has rebranded it as The Collection at Independence and hopes to start construction later this year to turn the property into a contemporary mixed-use center.

WHAT DO READERS WANT TO SEE THERE?

PHOTO C/O CITY OF WILMINGTON

The corporate headquarters for PPD, a global contract research organization, is shown under construction in this file photo. The 12-story building opened on North Front Street in 2007.

stands how to get things done, what works and what stimulates the economy,” Eshelman said.

Broadhurst left town and resigned as mayor in 2006 when a promotion with SunTrust Bank moved him to Greensboro. He returned to Wilmington last year as First National Bank’s regional president.

His return leads to the question of whether he’ll run for office again. He certainly sounds like it: “This is the greatest place in America to live. That’s why I came back. The opportunities are endless.”

The governor recently appointed Broadhurst as vice chair of the USS North Carolina Battleship Commission, and he’s considering other board positions.

“I’m definitely going to get involved in the community,” he said. “We’ll see where it goes.”

Hopefully, it goes back into public office and more deals like the one we now see blossoming on our northern riverfront.

Rob Kaiser is the publisher of Greater Wilmington Business Journal and WILMA magazine. He can be reached at 343-8600, ext. 204 or rkaiser@wilmingtonbiz.com.

“ CHEESECAKE FACTORY … PF Chang's … Maggiano’s, these are all gold in this market” “And get an IKEA for crying out loud.” – LEVI GP HUNT “ SOME HIGH END STORES like a Restoration Hardware or a Pottery Barn etc would be nice” – KAREN ANNE “NORDSTROM” – HOLLIE PAGE LANDEN

“APPLE STORE” – DAWN IRWIN

“ EVEN A WEGMANS would be great! Four planned for The Triangle area, so not completely a stretch” – ROB BENCA

T W I T T E R P O L L : @ W I L M I N GT O N B I Z

WHAT DOES THE WILMINGTON-AREA MARKET NEED MORE OF? RETAIL SPACE

GROCERY STORES

OFFICE SPACE

27%

14%

45%

HOTELS 14%

W I L M I N GT O N B I Z . C O M

READER REACTIONS

DOT CHOOSES OPTION TO EASE MILITARY CUTOFF, EASTWOOD ROADS CONGESTION “SO THIS $26 MILLION (DOT) PROJECT is so the 1 million-square-foot retail, hospitality, office and residential center on 23 acres with street frontage on both Military Cutoff and Eastwood roads … can be built? If it is already horribly congested with new shopping and other development going on now, why are we adding density here??”– MIRANDA BLANCHARD RUTLEDGE NATIONAL GYPSUM DISCUSSIONS CONTINUE AMONG PUBLIC, GOVERNMENT LEADERS “… WE NEED THIS TO HAPPEN. We NEED these jobs. Stop with the rhetoric and b.s. and get this company here. You know who DOESN’T have concerns? Those cities and towns that are thriving in jobs because of true economic development …”– COREY LEWIS “DEJA VU. Chemours all over again.”– JOE B. SIGN UP FOR DAILY NEWS UPDATES AND SUBSCRIBE TO THE GREATER WILMINGTON BUSINESS JOURNAL AT WILMINGTONBIZ.COM

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BizBites

DIGEST THE

A R O U N DU P O F R E C E N T CO MME R C IA L R E A L E STAT E NE WS

DOWNTOWN OFFICE CHANGES HANDS

W H AT ’ S S H A K I N G AT M AY FA I R E While tenants have moved into new buildings at Mayfaire Town Center in the past two years, plans for additional structures not far from the center’s anchor movie theater have been put on hold for now, according to CBL & Associates Properties.

Tennessee-based CBL purchased Mayfaire Town Center and Mayfaire Community Center off Military Cutoff Road in a $192 million deal in June 2015, selling Mayfaire Community Center to Principal Real Estate Investors near the end of that year for about $56 million.

Before CBL purchased the Mayfaire centers, the owners and original developers were H.J. Brody and members of the Zimmer family.

Mayfaire Town Center’s first anchor tenant, Hecht’s, located where Belk is today, opened in 2004.

Site plans filed at the end of 2015 had called for seven new buildings in Phase III of Mayfaire

Town Center. Four new buildings in that phase were constructed over the next two years at the center, on vacant land near the Regal Mayfaire Stadium 16 movie theater. The new space that was built is now home to H&M, Sola Salon Studios, Palmetto Moon and Hand & Stone Massage and Facial Spa. As of press time, The STEM Labs, a new business that offers science, technology, engineering and math enrichment programs for kids, was set to open in May on the same side of Town Center Drive as Palmetto Moon and Hand & Stone.

Meanwhile, additional new tenants to the center that have leased existing space include boutiques Tusc and Style Me Boutique.

Tusc relocated from downtown Wilmington, while the Mayfaire store is a second location for Style Me Boutique. The first is in North Myrtle Beach, South Carolina.

– CECE NUNN

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M A G A Z I N E

In a major office deal at the end of last year, the Wells Fargo-anchored building in downtown Wilmington at Third and Grace streets sold to an investor based in Winston-Salem for nearly $11 million.

Taylor Development Group bought the 57,000-square-foot, class-A office building at 300 N. Third St. on Dec. 28 for $10.72 million. Earlier in 2017, Taylor Development Group bought a pair of office buildings on Eastwood Road known as Landfall Park North and Landfall Park South.

“We have been very pleased with the Wilmington office market and see excellent fundamentals for the future,” said Chris Ramm of Taylor Development Group.

$4.2MILLION The amount of money Pender County has spent on the Pender Commerce Park, including acquiring land and investing in infrastructure, on U.S. 421 near Currie where expected new tenants are FedEx Freight and Coastal Beverage Co.

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A TIME TO TRANSFORM

The Wilmington area is on the cusp of dramatic changes

ith plans multiplying and earth turning throughout the Cape Fear region, the area is on the precipice of a new wave of development that could determine how the community grows for decades to come.

Developers are working on major commercial projects that could

We are redrafting the DNA that describes how our city will be built.

That affects every property owner, every landowner and every business owner. It’s an enormous task that is not done but probably once or twice in anybody’s lifetime,” said Glenn Harbeck, director of planning, development and transportation for the city of Wilmington.

That’s what Harbeck told

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have the same impact as Mayfaire, the ground-breaking mixed-use development created in Wilmington more than 14 years ago.

The results of these plans could be transformational, and the shape of commercial real estate regionwide could depend on the decisions faced this year by residents and leaders.

“Rewriting the DNA of a city is essentially what we’re doing.

M A G A Z I N E

BY CECE NUNN

Wilmington City Council members earlier this year about the city’s current effort to rewrite its land development rules.

It’s a statement that could also refer to the current choices a number of community leaders and property owners are making or facing, in the city as well as in New Hanover, Brunswick and Pender counties, as to how they want to see the future of development unfold in the region.

With growth comes more traffic, closer scrutiny of urban sprawl and aging properties and the need to update a community’s rules regarding development. As new development codes are in the works by local officials, projects under construction and in the planning stages could serve as catalysts for additional growth.

ORG AN I C GR O W T H

Some recent activity is coming from existing businesses.

In one example of a major project, a third building and a parking deck with a fitness center (shown below) are under construction at the headquarters of Live Oak Bank, while the company is moving forward with plans for a fourth building and possibly more structures. The third building will hold additional employees for the rapidly growing firm, one of the largest SBA lenders in the country, and the aim with the fourth building is to foster multiple companies like Live Oak spinoff nCino, a banking software firm that grew to a company valued at $1 billion in five years.

Live Oak owns 25 acres of land at its campus on Tiburon Drive in midtown Wilmington, with the possibility of being able to acquire more of surrounding land that belongs to longtime Wilmingtonians and development influencers the MacRae family.

“So we’re just getting started,” said Live Oak CEO James “Chip” Mahan.

In New Hanover County and the city of Wilmington, the amount of developable, vacant land continues to shrink, a fact officials have been concerned about for several years.

A 2014-15 analysis by the city showed 5,800 acres of potentially redevelopable land and 3,600 acres of potentially buildable vacant land in the city. Additionally, New Hanover County is the second-smallest county in the state.

As a result, infill and redevelopment will be key words moving forward.

Current major redevelopment projects in the works include transforming the former site of the Water Street parking deck into River Place, a public-private partnership between the city and Chapel Hillbased East West Partners that will create a new parking deck, apartments, condominiums and commercial space in a 13-story building in downtown Wilmington.

Meanwhile, the planned 1 millionsquare-foot CenterPoint development

by Swain & Associates, a Wilmingtonbased firm, is an example of a major infill project that could be on the horizon.

“Infill development will very much be a very critical component of how the city looks in the next 20, 30 years,” Wilmington Mayor Bill Saffo said. “I think that’s why this rewrite of the development code is critically important.”

G R O W ING U P

As with River Place and CenterPoint, the buildings will be higher, and one of the major reasons behind that is the cost of land.

David Swain, founder of Swain

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& Associates, said land on Military Cutoff Road that might have cost a developer about $150,000 an acre 15 years ago would be more like $700,000 to $1 million an acre today.

Developers are counting on being able to do more with less.

“This is a 23-acre tract of land,” Swain said of the site off Military Cutoff and Eastwood roads where CenterPoint is planned. “In the past, for instance, The Forum (the existing Military Cutoff shopping center that Swain developed in 2003) is on about 21 acres. It is all one-story except for two or three two-story areas within the complex, but that was a project that was developed 15 years ago. You would not develop that now.”

A developer has to plan higher buildings “to generate the revenue stream that will accommodate the cost of our land,” he said.

But The Forum was also developed with the future in mind, said Jason Swain, David Swain’s son and developer with Swain & Associates.

“He built a shopping center, which is a big step up from anything else that really anyone else in the state was doing at the time – the copper dome, the outside green areas, the artwork … all these things were designed to create an experience, to elevate the style of commercial real estate in our community,” Jason Swain said.

CenterPoint, he said, “is the next evolution for our industry.”

“I think you will see this standing 100 years from now. It will be like some of the 100-year-old buildings

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downtown,” David Swain said.

“They’re obsolete in some of their features, but CenterPoint will be a focal point because it’s in such a strategic location to the community.”

Another major project, The Avenue, is a $200 million mixeduse proposal on Military Cutoff that would be anchored by a Westin hotel and conference center. As of press time, The Avenue developer The Carroll Companies was seeking a development agreement and a special use permit from the city of Wilmington, along with filing for a rezoning request to change the project’s 44-acre site from having a mobile home park designation to an urban mixed-use zone.

In addition to the 75-foot Westin on The Avenue, the development is expected to include an upscale spa, apartments, class-A office space, fine dining, unique retailers and exclusive boutiques.

Development agreements can memorialize the promises a developer makes, said Roy Carroll, president and CEO of The Carroll Companies.

He said The Avenue will have a 10year build-out schedule.

PHOTO BY CHRIS BREHMER

LOOKI N G AT LA ND

New Hanover County’s largest landowners, which according to property tax records include members of longtime Wilmington families the Camerons, the Trasks and the Corbetts, will continue to be factors in the city’s future. The Camerons and Trasks in particular have had a major influence on the commercial and residential development of New Hanover County for several decades.

“They’re going to have obviously a very big role to play. It’s a small geographic area; land availability is scarce,” Saffo said. “The land that is available has become very expensive, and how they (large landowners) develop (their property) is going to be very important to the elected officials because it’s going to basically determine how the city is going to look and set the precedent for how future infill development takes

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RENDERING C/O SWAIN & ASSOC.

Top: Jason Swain (left) and his father, David, of Swain & Associates stand near land on Eastwood Road in Wilmington that is part of the site of their planned mixed-use project, CenterPoint. Bottom: A rendering of CenterPoint, shown with its access on Military Cutoff Road

place.”

One owner who wants to develop a larger piece of land can lead to a better development plan in some cases, said Wayne Clark, planning and land use director for New Hanover County.

“Oftentimes, it’s a lot more difficult to take 50 or 60 individuals and come up with a cohesive product.

You can still make it work with a bunch of individuals, but it’s a little more complicated that way,” he said.

In North Carolina, rezoning land requires analyzing whether the change is consistent with local longM A G A Z I N E

range plans.

“It’s easier to do that when there’s large landowners like we have here because they were part of the process.

When the future vision was put out there for what’s going to happen, they were part of the conversations,” Clark said, referring to the public meetings that took place before the county’s first Comprehensive Plan was adopted in 2016.

The plan is being used to rewrite the county’s antiquated development code, which dates back to the late 1960s and early ’70s. Both the city and the county are rewriting those

plans, aiming to work in tandem so that the development rules aren’t completely different, an outcome that wouldn’t make sense or serve those trying to use them, officials say.

Donna Girardot, chairwoman of the New Hanover County Planning Board, said the new development rules result in a better system.

“I think it will allow us to adopt more flexible codes. I think it will streamline the permitting process, which of course equates to less cost on the developer, which equates to less cost on the buyer whether it’s residential or commercial,” Girardot said. “And I think it opens up many more options for us for development patterns. If you noticed in the comp plan, there’s a lot more mixed use out there. Of course with mixed use comes retail and commercial and that type of thing and density.

That’s what I mean by making more options available to us for development.”

The Unified Development Ordinance in the works won’t be driving development, she said, but rather guiding it.

“The market and the property owner, the landowner, will drive the market,” she said.

It will also allow developers “to try new things, new cutting-edge development patterns and things like that, that in the past they might have not felt comfortable in trying because of all of the regulation and all of the time and money that it was costing them,” Girardot said.

TRAN S F O RMAT I O N IN PR O GR E S S

In some spots, projects that could change the development landscape are already underway.

Bruce Cameron Jr., who died in 2013, once told Anne Brennan, executive director of Cameron Art Museum, that he believed Wilmington’s midtown would one day become a new downtown.

Cameron Properties Land

Co. of Wilmington and Collett, a Charlotte-based retail development firm, are co-developers of The Pointe at Barclay, a movie theater-anchored entertainment and dining complex at South 17th Street and Independence Boulevard in midtown. The Pointe is surrounded by additional Cameron developments such as Element Barclay apartments (in partnership with Childress Klein Properties, also of Charlotte) and The Forks at Barclay (in partnership with Trusst Builder Group), a neighborhood next to Cameron Art Museum of single-family homes and townhouses.

The Pointe is 34 acres, part of a 150-acre master-planned development.

Another part of the Cameron family is planning a development project on Shipyard Boulevard.

Graham Cameron Land LLC has proposed two, three-story buildings that would include medical and professional office space and a restaurant.

The development activity in midtown Wilmington, and nearby along River Road where RiverLights is taking shape, represents one site of major growth, while others include northern New Hanover County in Ogden and Porters Neck.

In Brunswick County, buildings are on the rise in the northern town of Leland, and new businesses are coming to more southern Brunswick towns of Shallotte, Southport and St. James. Rooftops are increasing in the Pender County community of Hampstead, and with those rooftops, commercial brokers expect a rise in interest from businesses wanting to locate where the residents are.

Not all property owners will make the most of what they own.

Some properties still languish even 10 years after the recession.

In some cases, the owners of older properties that were built under a different set of rules three and four decades ago will find redevelopment difficult, Saffo said.

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LARGEST LANDHOLDERS Largest tracts of land by ownership firm in acres; amounts are approximate NE W H A NOV E R CO UNT Y COMPANY

ACREAGE

HILTON PROPERTIES LTD PTR

4,021

SIDBURY LAND & TIMBER LLC

1,874

GENERAL ELECTRIC CO.

1,614

NNP IV CAPE FEAR RIVER LLC

1,188

SIDBURY LAND & TIMBER LLC

1,037

INVISTA S.A.R.L.

964

SHORE ACRES CO.

842

CORBETT INDUSTRIES INC.

841

TRASK DANIEL WEBSTER REV TRUST ETAL

837

CASTLE HAYNE DEV. INC.

764

B RUNSW I CK CO UNTY SOUTHERN DIVERSIFIED LLC

4,434

DUKE ENERGY PROGRESS INC.

3,464

SPRINGWOOD TIMBERLANDS LLC

2,800

LILLIPUT INTERESTS LLC

1,358

TOWN CREEK LAND PARTNERS LLC

1,134

GERT HOLDINGS LLC

1,062

MILL CREEK LANDHOLDINGS LLC

1,007

HIBERNIA MANAGEMENT LLC

955

JAMESTOWN EQUITY LLC

897

CLEAR BLUE SKIES LLC

583

P E NDE R CO UNTY RED MOUNTAIN TIMBER CO I LLC

42,182

CORBETT INDUSTRIES INC.

12,188

TC&I TIMBER CO. LLC

9,205

CORBETT PACKAGE CO.

7,523

CONE’S FOLLY TIMBER FARM LLC

6,336

CORBETT WILBUR R

5,015

CORBETT PACKAGE CO.

4,952

OCEANIA HOLDINGS LLC

3,877

OAK ISLAND LAND & TIMBER LLC

3,100

PENDER PROPERTIES LLC

3,063

SOURCE: NEW HANOVER, BRUNSWICK & PENDER COUNTY TAX DEPTS. 2 0 1 8

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LEG ACY & LAN D HO LD I N G S

George W. Trask (left) and a foreman pose at Trask’s Farm, Blythe Savannah, now known as Pine Valley.

Lettuce was a staple of the truck farming industry.

The following are acreage amounts held by local families with longtime ties to the area that still have major property holdings in New Hanover County. Amounts are approximate and may not include all of the family holdings.

T H E T R A S K family can trace its roots in the Cape

6,200

ACRES

4,000

ACRES

2,800

ACRES

1,600 CORBETT

SLEDGE

TRASK

ACRES

CAMERON

ACRES

8k 7k 6k 5k 4k 3k 2k 1k

PHOTO C/O THE LOUIS T. MOORE COLLECTION AT THE NEW HANOVER COUNTY PUBLIC LIBRARY

SOURCE: NEW HANOVER COUNTY TAX DEPARTMENT

Fear region back to the 18th century, later making a name for themselves as successful lettuce farmers. In more modern times, the Trasks purchased the land in the 1950s that would one day become a master planned mixed-use development on Eastwood Road called Autumn Hall. Also over the years, members of the Trask family used their farmland to enter the development industry, with Raiford Graham Trask Sr. creating major subdivisions throughout Wilmington. He also developed Duck Haven golf course, which is now Autumn Hall, among other numerous contributions, including donating or selling land for what is now the campus of UNCW. His son and grandson, Raiford Trask Jr. and Raiford Trask III, have developed Autumn Hall and other current and forthcoming projects in the Cape Fear region.

For example, stormwater regulations can have a major impact on whether someone chooses to redevelop an aging strip center or not because the calculations for how much of that runoff from rain and snow that a developer needs to manage are vastly different than in days past, if they existed at all.

“That’s why you see some reluctance to redevelop because of the cost,” Saffo said.

I NVEST I N G I N P R O P ERT Y Although necessary to maintain the natural resources of an area, environmental regulations, particularly stormwater rules, can render a piece of property useless in some cases.

“Environmental regulation change, particularly stormwater interpretation, can be the same as condemnation or confiscation,” said Raiford Trask III of Trask Land Co.,

whose family has owned land in the Wilmington area for hundreds of years.

That’s on top of the typical cost of aiming to hold on to land from one generation to the next.

“You have to continually reinvest in land, which can be painful from a cash-flow standpoint, because it’s typically buy it and hold it and pay the carry cost,” Trask said.

Reinvesting can mean developing parts of the land to diversify a family’s asset base, he said.

Trask’s current projects in New Hanover County include Autumn Hall on Eastwood Road and Renaissance Market, a new retail center under construction at Military Cutoff Road and Sir Tyler Drive. The retail center, which Trask Land is developing in partnership with Harbour Retail Partners, will be anchored by a newto-Wilmington organic grocer, Earth Fare, and boat supplies business West Marine.

The history of T H E CAMERON family in the Wilmington area harkens back to before the Civil War. In the 1950s, Bruce Cameron Jr. and Dan Cameron began acquiring the property that would become Figure Eight Island, a gated island community developed by the Camerons, their cousin Raiford Graham Trask Sr. and investor Richard Wetherill. In addition to numerous civic and philanthropic contributions the Camerons have made in the region, the family also developed the midtown office buildings that Wilmingtonheadquartered contract research organization PPD occupied before the firm moved downtown. Today, Cameron developments are transforming the city’s midtown, among other sites throughout the area.

The Renaissance Market site has been owned by the Trask family since 1956, Trask said.

Trask Land is working on a new acquisition, property in Scotts Hill, for a master planned community called Blake Farm, although the residential portion of the development was, as of press time, tied up in a legal dispute with Trask Land’s partners in the project.

Trask said his firm is getting closer to being able to announce some commercial tenants for the Pender County development, which he hopes could still include a branch of the state aquarium system.

In the meantime, new development is coming to Autumn Hall, the Eastwood Road mixeduse community that replaced a golf course. Those additions to Autumn Hall could take the form of new office space, building on the success of the Dungannon Village office building that opened there last year.

KEY TO PHOTO GRID (PAGE 18): 1. ASPEN HEIGHTS; 2. THE POINTE AT BARCLAY; 3. CAROLINA BEACH YACHT BASIN; 4. EMBASSY SUITES AT WILMINGTON CONVENTION CENTER; 5. THE GALLERIA; 6. REHAB OF 1 S. FRONT ST.; 7. RIVERLIGHTS RIVERWALK; 8. THE OFFICES AT MAYFAIRE; 9. MILITARY CUTOFF TRAFFIC; 10. THE POINTE 14; 11. THE AVENUE RENDERING; 12. RIVERLIGHTS ROUNDABOUT; 13. LELAND ALDI; 14. VACANT DOWNTOWN LOT; 15. THE FORKS CONSTRUCTION

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I NEV I TABLE DEVE LO PME N T

Current discussions aren’t the first time officials have had to take stock of the next steps in the area’s development growth.

Eighteen years ago, Eastwood and Military Cutoff roads were seen as holding some of the largest and most desirable tracts of land within city limits.

A city committee of 14 people worked with the city staff to develop guidelines for a mixed-use development because of rezoning requests for Hardy Parker Farm, the land that would become Mayfaire, and Duck Haven Golf Club, which would become Autumn Hall.

And while it’s difficult to predict exactly what will happen in the Cape Fear region’s anticipated growth nodes, change is inevitable.

Clark, who was the city’s planning manager when the Mayfaire and Autum Hall rezoning requests were in the pipeline, said,

“I’m sure in the 1970s, people didn’t see Military Cutoff as a market for Mayfaire.”

For the future, developers and local officials say transportation improvements and walkability remain top priorities. As an example, the mayor of Wilmington pointed to the South Front development by Tribute Companies, where a former public housing project, a former factory and aging buildings have been transformed into a mixed-use community where residents can walk to bars and a restaurant and soon even more businesses.

Growth and change are part of any community’s evolution; the tricky part for both developers and local officials, they say, is trying to meet the demands of an expanding community while retaining the characteristics that keep drawing new residents to the Wilmington area.

“Things are going to come down,” Saffo said. “New things are going to be built on top of things that are already in existence today.”

HIGHEST VALUED PROPERTY Highest valued property by tax appraisal in New Hanover County (land and buildings) PROPERTY

APPRAISAL TOTAL

PPD 929 N. FRONT ST.

$58 MILLION

INDEPENDENCE MALL 3500 OLEANDER DRIVE

$53.4 MILLION

GENERAL ELECTRIC CO. 3901 CASTLE HAYNE ROAD

$53.3 MILLION

CORNING INC. 500 N. COLLEGE ROAD

$40.2 MILLION

CAMBRIDGE VILLAGE 75 CAVALIER DRIVE

$37.5 MILLION

CAROLINA BAY 630 CAROLINA BAY DRIVE

$35.8 MILLION

MILL CREEK APARTMENTS 414 MILL CREEK COURT

$33.4 MILLION

RIVERLIGHTS 4410 RIVER ROAD

$31.9 MILLION

HOLIDAY INN RESORT 1706 N. LUMINA AVE. WRIGHTSVILLE BEACH

$30.6 MILLION

ASPIRE 349 APARTMENTS 349 CAMPUS COVE

$26.1 MILLION

SOURCES: NEW HANOVER COUNTY TAX DEPARTMENT, N.C. SECRETARY OF STATE CORPORATIONS DIVISION, GREATER WILMINGTON BUSINESS JOURNAL

LIVE OAK BANK CAMPUS

Building Wilmington for over 35 years

FOCUSED ON THE FUTURE

910.392.5220 | 2250 Shipyard Boulevard, Suite 1, Wilmington, NC 28403

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1 TRENDS

THE GROWTH OF MIXED-USE

The term “mixed-use” has become a familiar phrase in Wilmington conversations as an ideal development method or redevelopment where appropriate.

Most high-profile projects have the mixed-use label, including Mayfaire Town Center, where residents live above retail spaces. The next generation of major mixed-use projects is planned along the same corridor where Mayfaire has a mix of residents, shoppers, diners and office workers. The newly proposed projects include CenterPoint, The Avenue and Arboretum West and Arboretum Village. One smaller example is Kerr Station Lofts (rendering at right) on South Kerr Avenue, which will include apartments, townhomes and commercial space.

LELAND PICKS UP STEAM

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When he couldn’t find an appropriate space in downtown Wilmington for a building he was planning, businessman Yu Hang Wang set his sights on the Leland area, where there’s a noticeable uptick in commercial development.

“It is one of the faster-growing areas in North Carolina, especially in the past five years. Everything’s kind of started exploding over here,” said Wang, owner of Hibachi Bistro locations in Wilmington, Kinston, Greenville, and soon, Leland.

His development, Ocean Gate Plaza, is an 11,163-square-foot building next to the Walmart shopping center on U.S. 17.

Wang’s project is just one example of a number of developments coming online in the Brunswick County town.

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TO WATC H

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he economy’s strength in recent years has awakened sites with pentup commercial real estate potential throughout the Wilmington area.

Here are 10 trends punctuating the Cape Fear region’s commercial market:

REDEVELOPING & REUSING SPACES

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M A G A Z I N E

BY CECE NUNN

Examples abound of redevelopment projects in the city of Wilmington, where vacant land is scarce. Notable examples include River Place (left), a 13-story structure with luxury condos, apartments and retail space that will be built at 200 N. Water St. downtown, expected to be finished in 2020, and Independence Mall, 3500 Oleander Drive, where new owners intend to overhaul the property.

Independence Mall has been renamed The Collection at Independence. The company that purchased much of the mall, Rouse Properties, plans to remove sections of the mall’s interior, demolish the Sears store and add residential units, a hotel and a medical office building.

4

TRENDS

MORE HOTELS COMING

While downtown Wilmington has been the setting for the most recent high-profile hotel projects, including an Embassy Suites by Hilton Wilmington Riverfront connected to the Wilmington Convention Center, more are planned.

An Aloft Hotel is under development by Poteat Hospitality at the Coastline Conference and Event Center on Nutt Street.

And Clarendon Properties is working on bringing a hotel to Porters Neck, an area that doesn’t currently have one.

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INDUSTRIAL SPACE CHALLENGES

“We have a real shortage here.

Anything from 10,000 to 25,000squarefeet, we just don’t have it. There’s very little of it sitting out there available,” Grayson Powell, managing partner of Wilmingtonbased Coldwell Banker Commercial SunCoast, said of local industrial space.

Nationally, “merchandisers looking to get something to you in the same day, they need to have a distribution channel closer to the consumers.

That’s why there’s such tremendous demand for industrial right now,” said Fred Schmidt, president and chief operating officer of Coldwell Banker Commercial Affiliates.

6

NABBING NATIONAL TENANTS

While some commercial real estate projects call for local businesses, other developers are working on bringing in more national and regional tenants to the Wilmington area.

For example, for the first time, a Chick-fil-A is on the way to Leland Town Center, while another is planned in Porters Neck.

Sportsman’s Warehouse, a publicly traded (Nasdaq: SPWH) seller of outdoor recreation apparel and gear, opened last year at 4715-A New Centre Drive, and a 63,000-square-foot Academy Sports + Outdoors store opened last year off Market Street.

7

eight

GROCERY STORE WARS

When it comes to the grocery sector of retail, the Cape Fear region has successfully courted new brands.

Aldi has built its first stores in the area.

Wilmington-based commercial real estate firm Cape Fear Commercial and its development arm, GHK Cape Fear, developed the region’s first Publix, at 716 Bragg Drive in Wilmington, which opened in 2016.

Locations of grocery stores Lidl and Earth Fare are also planned.

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PENDER COUNTY HOTSPOTS The northernmost county in the Cape Fear region’s tri-county area is expected to see more growth in the coming years, and with that growth will come greater interest by commercial prospects, brokers say.

“The developers are primarily looking in southern Pender County – Hampstead and south – but that’s also trickling north into the Surf City market,” said Paul Loukas, broker in charge at Cape Fear Commercial.

Pender Commerce Park in Currie is attracting new tenants and new retail is expected in Hampstead.

PICKING SMALLER FOOTPRINTS

Bigger is not better for some retailers these days, brokers and developers say.

Some larger shopping center spaces, such as a former Roses department store at Ogden Plaza, are being broken up to accommodate more than one tenant.

In general, said Nicholas Silivanch, of Eastern Carolinas Commercial Real Estate, there’s a lot of interest in smaller spaces, especially for restaurants between 1,200 and 2,400 square feet. He said ECCRE is working on some space reductions to bring more tenants to small shop space at vacated junior box stores, including a former Dollar General at Leland Plaza.

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OFFICE MARKET INVESTMENT

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The demand for office space is strong throughout Wilmington.

Some examples: The fifth and sixth buildings in The Offices at Mayfaire series are under construction behind Mayfaire Community Center.

And crews broke ground in January on the TowneBank Building, a Cape Fear Commercial project. Meanwhile, a new series of office buildings is planned off South 17th Street and Independence Boulevard, called The Offices at Barclay.

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POINT

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OF VIEW

BY CHRISTINA HALEY O'NEAL

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PHOTO BY MICHAEL CLINE SPENCER

PROFILE

THE D O W N TU R N P UT T H E B R A K ES O N P LA N S F O R T H E V I E W, B UT TE R R Y ES P Y SEES SU C C ESS T H ESE D A Y S

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eal estate broker and developer Terry Espy moved to the Wilmington area full time in 2007 to work on a development project called The View.

The plan was to develop an up-to-11-story, mixed-use project downtown that included retail, about 70 condos, rooftop green spaces and a pool on the ninth floor. She and her partners invested about $6.5 million in the property, she said, but the investment in the project didn’t stop there.

Another $800,000 went into construction drawings, and they spent about $750,000 to tear down the old Wachovia building at the Princess Street site.

Things did not go according to plan, with The View or the area’s commercial real estate as a whole.

At the time, “it was at the peak of the market,” she said, but soon that market took a downturn.

“This was not a fly-bynight endeavor,” Espy said of the project. “It was one of these things that nobody had any idea the economy would do what it did.”

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It was more than a two-year process to get permits in hand, she said. By that time, it was 2009, and “the world had fallen apart,” she said.

The development industry was turned upside down. Lending for private mortgages and construction dried up, Espy said.

She worked for years to research and find an avenue that would see the project through before she and her partners had to hand the property back to the bank in 2011.

Today, the property remains a vacant lot downtown between Water and Front streets.

“It is a current, still viable (project). People still love the design,” Espy said. “That’s what I see on that lot every time I walk by. I’m hopeful that at some point, that will pan out. And there are not six months that go by that somebody else gives a call about it … I know there are groups out there that could do it if they could just work it through with the guys that own the property.”

Although The View didn’t work out, Espy carries that same passion for other Wilmington projects. Since the market has picked back up, business for Espy, now president of her own firm, MoMentum Companies, is booming, she said.

“For me right now, I cannot explain the intensity … At least five new clients a week are walking in the door, people that want to be in Wilmington,” she said, adding that old spaces are limited, “so we have to start creating more.”

Espy, who had previously worked on projects in Raleigh, said she didn’t always have her mind set on Wilmington and up until a couple of years ago, had “one foot out the door.”

“It was stressful,” she said about the recession. “All the developers will tell you that during that time it was not a

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pleasant time in life.”

Espy took a monthlong trip out west and seriously considered a position at the University of California, Berkeley, she said. On her way back to North Carolina, however, a couple calls from friends thrusted her mind back into the Wilmington scene and into the commercial real estate world.

“I always say the coolest things in my life just kind of reared their head. I didn’t aim for them,” Espy said. “I never ever thought about doing commercial brokerage as a career. But what I realized is that I’m used to developing businesses.”

Espy has brought several projects to the area since. She’s helped bring high-profile developments and some big names to Wilmington.

She played a role in drawing Benny’s Big Time Pizzeria, a restaurant by chef Vivian Howard, that’s opened in phase two of the South Front redevelopment project. In that same development, more tenants will be sought for the 18,000-square-foot industrial Capps Building.

“We have been really careful and cautious with the mix there, between the Capps building and the container building, to create a cool environment,” she said.

Espy said she operates from a different perspective.

“We have a weird mantra here. I tell people, I’m a sucky broker,” Espy said. “I’m an urban developer first. It’s about community. It’s not about how much I’m going to make.

“I’m not a big proponent of nationals. I believe that people become loyal to people, not to corporations,” she said. “And especially Wilmington – I’d say this place really has the Cheers mentality. When an individual has been there more than once, you better know their name.”

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PROFILE

O F F I C E

AFICIONADO

BY CECE NUNN

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STE V E ANDERSON W EAV E D A C A R EE R IN OFFICE S P A C ES FROM A M ATE R I AL STA R T

w i l m i n g t o n b i z m a g a z i n e . c o m

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n a way, Steve Anderson’s path to becoming a developer of multi-million-dollar office spaces started with a tip about some alligator shirts.

Today, he’s known for leading the creation of six office buildings at Mayfaire in Wilmington, among other projects throughout the city.

But his entrepreneurial journey began about 40 years ago.

In the late 1970s, Anderson, a senior at Hoggard High School, bought some Lacoste shirts at a low price from a manufacturing plant while visiting his brother in Winston-Salem.

“I sold them out of the trunk of my car at lunchtime and before school in the mornings,” Anderson said. “I doubled my money in a couple of days.”

The alligator shirt, later branded as Izod Lacoste, became the height of preppy attire in the 1970s and ’80s, but they weren’t cheap, selling in department stores for about $20 in the late 1970s. But Anderson and a high school buddy of his were able to offer the manufacturer’s castoffs at a price of $4.99 to $6.99.

Longtime Wilmingtonians still remember when Anderson started out in the clothing business.

“I’ve known Steve since 1976 when we used to go buy alligator shirts,” Wilmington Mayor Bill Saffo quipped in November, at a groundbreaking ceremony for Anderson’s latest The Offices at Mayfaire project. “He’s been an entrepreneur since he’s been in high school.”

The shirt business grew quickly, and in 1976 Anderson and his friend opened A&G Outlet in a 500-squarefoot space on South College Road.

That was followed by two more stores, one in downtown Chapel Hill and one in Raleigh.

In the meantime, in 1974, Vanity Fair opened the first multi-store outlet center in Pennsylvania, and by the 1980s and 1990s, outlet malls were growing at a rapid pace 2 0 1 8

throughout the U.S. “Outlets came out of the basements of these manufacturers in these mill towns, and then all of the sudden just blew up everywhere,” Anderson said. “It became harder and harder for us to get all these goods.”

So he moved into first-quality clothing for men and women, changing the name of the business to A&G Sportswear. From 1979 to 1999, he operated a store at Hanover Center, next to the children’s clothing store his parents owned for 38 years, Tiny World.

A&G was open every day of the year except Christmas and Thanksgiving. One of Anderson's sons, Parker, who works with him in the development business these days, recalled his late nights.

“It was crazy because when he was in retail, I remember, he would come home at 7 or 8 o’clock at night, and by the time we’d wake up, he was gone. I’ll never forget, every day he would come home, and I’d get on the bed, and he’d stand at the foot of the bed, and I’d run as fast as I could and jump into his arms, and he would spin me and throw me back on the bed,” Parker Anderson said.

Parker Anderson is still having fun with his father, he said, in the business world. Now a graduate of the University of North Carolina Wilmington with a degree in communication studies, with a concentration in negotiation and conflict resolution, Parker Anderson interned with his father during his junior year.

“The internship is what really made me decide I wanted to get into development. We had so much fun, and I knew how hard it could be – in the good times, it’s good, and in the rough times, it’s rough,” Parker Anderson said.

Steve Anderson remembers the moment that sparked his second career in commercial development.

“I was literally sitting at the stoplight at 41st Street one morning R

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going to work, and lease negotiations (at Hanover Center) were coming up … and there was a sign sitting on an empty lot,” Steve Anderson said. “I called my wife, Buffy, and I said, is this too crazy of an idea?”

He purchased the property, and in 1999, started his first development project: Anderson Square. The first phase of the two-building project was 15,000 square feet, and his clothing store, which by then he called Anderson Clothing Co., sold high-end men’s and women’s clothing and gifts.

His Anderson Square experience prompted him to turn more toward development and redevelopment.

Although he remained in the clothing business until 2005, Anderson also created two more phases of Anderson Square, in 2003 and 2004. Other projects have included the 17th Street Medical Park in 2004 and the Howe Creek Landing office building in 2006.

By 2011, he had filled up the first The Offices at Mayfaire building with tenants. This year, the last two of the six The Offices at Mayfaire buildings are under construction, and Steve and Parker Anderson are working on their latest project, Bradley Creek Station, a retail and office building that will replace aging structures on Oleander Drive.

People might think someone who has had such an impact on office space in Wilmington would have his own office, but the Andersons mainly work out in the field, in a space at their home or at Tribute Companies, the firm of Steve Anderson’s partner Mark Maynard.

But Steve Anderson is considering establishing some of his own office space outside those options.

“This is something that Parker’s working on me about. He’s got my ear.

He said it might not be a bad thing if we start thinking about an office where we could actually hang a picture up, have a conference table …” Steve Anderson said.

When Parker Anderson said recently that his father has developed half a million square feet of office space in Wilmington, Steve Anderson corrected him, explaining that it’s not quite that much yet.

“But,” he added, “we’ll get there.”

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M A R K E T SNAPSHOT W I L M I N G T O N A R E A C O M M E R C I A L R E A L E S TAT E H I G H L I G H T S

2017 2

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ADDITIONS TO THE WILMINGTON RETAIL MARKET* * Ranked by size

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SOURCE: GREATER WILMINGTON BUSINESS JOURNAL; COSTAR PROPERTY, YEAR-END 2017 REPORT

PROJECT

ADDRESS

SIZE (sq ft)

1

THE POINTE 14 MOVIE THEATER

2223 BLOCKBUSTER ROAD, WILMINGTON

55,000

2

WESTGATE MARKETPLACE

1215 W. GATE DRIVE, LELAND

31,600

3

ALDI

7954 MARKET ST., OGDEN

19,700

4

ALDI

9410 PLOOF ROAD SE, LELAND

19,000

5

NEW CENTRE COMMONS

4712 NEW CENTRE DRIVE, WILMINGTON

15,348

6

H&M AT MAYFAIRE TOWN CENTER

833 TOWN CENTER DRIVE, WILMINGTON

12,000

6

SUGARWOOD CENTER

167 PORTERS NECK ROAD, PORTERS NECK

12,000

8

BUILDING 10, THE POINTE AT BARCLAY

1412 BARCLAY POINTE BLVD., WILMINGTON

9,100

8

DOLLAR GENERAL

1132 N. LAKE PARK BLVD., CAROLINA BEACH

9,100

BUILDING 2, THE POINTE AT BARCLAY

1474 BARCLAY POINTE BLVD., WILMINGTON

9,000

10

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OFFICE SPACE

LARGEST EXISTING

MARKET SNAPSHOT

BY SUBMARKET

1

MARKET

RBA*

VACANCY RATE

HOSPITAL/INDEPENDENCE

2,578,023

3.5%

DOWNTOWN

2,188,895

5.5%

MIDTOWN

1,994,960

3.7%

LANDFALL

1,765,081

1.4%

WEST BRUNSWICK

1,094,483

3.8%

SOUTHPORT/ST. JAMES

669,898

1.7%

MARKET STREET CORRIDOR

476,506

7.1%

LELAND

441,979

1.2%

EAST PENDER COUNTY

355,150

6.6%

AIRPORT

331,852

4.1%

MONKEY JUNCTION

285,229

1.9%

PORT

258,924

1.2%

OGDEN/PORTERS NECK

253,699

48.5%

WEST PENDER COUNTY

248,587

5.7%

CAROLINA BEACH

90,052

8.6%

2 3 4 5 6

TOP15

7 8 9

10 11 12 13 14 15

* Total Rentable Building Area in square feet

SOURCE: COSTAR PROPERTY YEAR-END 2017 REPORT

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TOP 8

MARKET SNAPSHOT

COMMERCIAL SALES of 2017

2

3

PROPERTY

1 2

BRUNSWICK POINT & TIDES AT CALABASH APARTMENTS INDEPENDENCE MALL – TRACT A

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ADDRESS

PRICE

BUYER

SELLER

1001 HUNTERSTONE DRIVE, LELAND & 7112 TOWN CENTER ROAD, SUNSET BEACH

$44,533, 000

INDEPENDENCE REALTY TRUST INC.

HAMILTON POINT INVESTMENTS LLC

3500 OLEANDER DRIVE, WILMINGTON

$44,354,500

ROUSE PROPERTIES

CENTRO INDEPENDENCE LLC

3

ASPIRE 349 STUDENT APARTMENTS

349 CAMPUS COVE ROAD, WILMINGTON

$43,200,000

BALFOUR BEATTY COMMUNITIES

REALCO CAPITAL PARTNERS

4

EMERGEORTHO OFFICES

3787 SHIPYARD BLVD. & 2716 ASHTON DRIVE, WILMINGTON

$30,600,000

FAEC HOLDINGS LLC

MMAC HT I WILMINGTON LLC

5

SPRINGHILL SUITES HOTEL

1014 ASHES DRIVE, WILMINGTON

$18,000,000

TPG HOTELS & RESORTS

PARKS HOSPITALITY GROUP

6

PUBLIX GROCERY STORE

716 BRAGG DRIVE, WILMINGTON

$14,348,500

PUBLIX NORTH CAROLINA LLC

BRAGG ROAD DEV. CO. LLC

7

PLATO'S LOFTS AT RANDALL

34608 RANDALL PARKWAY, WILMINGTON

$13,750,000

LOFTS AT RANDALL LLC

PLATOS LOFT LLC

8

ELLINGTON FARMS APARTMENTS

505 VORILS LANE, WILMINGTON

$11,830,000

SYNCO PROPERTIES INC

ELLINGTON FARMS APTS LLC

SOURCES: NEW HANOVER COUNTY TAX DEPARTMENT AND REGISTER OF DEEDS; BRUNSWICK COUNTY TAX DEPARTMENT AND REGISTER OF DEEDS ; GREATER WILMINGTON BUSINESS JOURNAL

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THE TAKEAWAY

OFFICE ENVY photo by MEGAN DEITZ

When James Goodnight rehabbed 21 S. Front St. several years ago, he gutted the downtown Wilmington building and turned it into a tech office.

Untappd, the beer social networking app that merged with Wilmington-grown Next Glass, moved its headquarters to the space in 2016.

Along with exposed brick and wood beams, there’s the expected startup touches of whiteboard walls, standing desks and 18 flat-screen TVs. “It’s open and well-designed, while still maintaining a lot of the features you’d hope to see from a historic building,” Untappd CEO Kurt Taylor (right) says about the space. “And to finish things off, there’s a bar with four beer taps and a rooftop deck to enjoy views of the Cape Fear River and Battleship.”

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