Cautiously Optimistic About the Future of the Railway Exchange Building

Word quickly spread on Wednesday about a vacant building downtown:

1. NextSTL: 1.2M SF Railway Exchange Under Contract, Mixed-Use Redevelopment Planned
2. St. Louis Business Journal: Developer has Railway Exchange Building under contract

While most were cheering the “news”, I was digging into the record of this developer. From the NextSTL post:

“While the firm has completed several historic redevelopments, one stands as particularly analogous. Hudson purchased the 1M+ sf Huntington Building in downtown Cleveland for $22M last year and have planned a $280M renovation. The 21-story building was completed in 1924.” 

So the analogous example is planned…not completed. What about their other projects? Let’s take a look, in the order listed on their website:

Huntington Building:

• 925 Euclid Ave, Cleveland, OH
• 21-stories, 1.4 million square feet
• June 2015: plans announced for building
• December 2015: state tax credit awarded
• Construction to start after the GOP convention concludes

Gulfstream Hotel:

• 1 Lake Ave, Lake Worth, FL
• 6-stories
• May 2014: to be renovated 
• August 2015: plans submitted
• December 2015: Rezoning approved
• February 2016: final OK of plans

Linton Towers:

• 100 E Linton Blvd, Delray Beach, FL
• 50,000sf office building
• Built in 1973
• Purchased in April 2013 for $6.8 million, per tax records

Mark Twain Building:

• 106 W 11th St, Kansas City, MO
• 22-stories, 204,095sf
• September 2013: different potential buyer from Florida planned renovations
• March 2015: indoor parking plan is controversial 
• April 2016: sale closed

Midtown Delray Beach:

• W. Atlantic Ave and S. Swinton Ave, Delray Beach, FL
• Conceptual
• September 2014: property sold, project announced
• July 2015: project sketch released
• Their website lists the city as Cincinatti, not Kansas City. Photo is a different building

The Orlando Hotel:

• Unable to find anything…

Starks Building:

• 455 S 4th St, Louisville, KY
• 14-stories, 346,000sf
• April 2015: closed on purchase
• Occupied at time of sale
• August 2015: hotel portion to be Canopy by Hilton
• January 2016: building permit issued

Sundy House:

• 106 S Swinton Ave, Delray Beach, FL
• Historic house
• Website
• Adjacent to the planned Midtown project

Textile Building:

• 205 W 4th St, Cincinatti OH
• 12-stories, 203,000sf
• Previously owned by the Hertz Group
• March 2016: redevelopment planned

I didn’t find anything actually completed — other than some purchases.  Do they have the right experience to get these complex projects done?

From January 2015:

Steven Michael once managed hedge funds and was a member of the Chicago Board of Trade.

Today he is focused on redeveloping historic and distressed properties, a passion he and his family have followed for some time.

In Delray Beach, he started real estate development firm Hudson Holdings with friend Andrew “Avi” Greenbaum, who also has a background in finance. The company is now managing the Sundy House hotel and restaurant and has a vision to renovate the surrounding area. Hudson also recently bought the Gulfstream Hotel in Lake Worth, which is on the National Register of Historic Places, and plans to redevelop that hotel, and add hotel rooms. (Wealth managers move into real estate development)

Their bios do indicate experience closing real estate financing deals. After my research, I have many reservations. I hope they’re successful.

One year ago yesterday, a ULI Technical Assistance Panel (TAP). gave a presentation on the top floor of the Railway Exchange:

Again, I want to see the Railway Exchange redeveloped, but we must not get so excited we fail at due diligence. Having worked in real estate for years I know that not every contract closes.

— Steve Patterson

Delmar & Euclid Building Will Soon Have New Use As Apartments

The 6-story building at Delmar & Euclid was known for decades as the Euclid Plaza Building. It was begun in 1910 as the General Van & Storage.  We know the building as 625 N. Euclid Ave, but General Van & Storage used 4908 Delmar Blvd. as their address.

In the early 1980s the building was redeveloped into office space by the now-defunct non-profit Union-Sarah Union-Sarah Redevelopment Corporation, headed by Nesby Moore.

At some point after the 80s renovation the owner became Del-Mar Corporation, which owned the building until it was lost at a tax sale:

Del-Mar Development Corporation (“Prior Owner”) failed to pay real property taxes on an office building it owned and the Collector of Revenue for the City of St. Louis conducted a tax sale on July 14, 1998, pursuant to the Municipal Land Reutilization Law (“MLRL”), sections 92.700 to 92.920 RSMo 2000. (casetext.com)

This building has held offices for KDHX, NAACP of St. Louis, and many others. Now, it’ll be apartments:

Best known locally for its Streets of St. Charles project, a developer from Peoria, Ill., is about to begin a loft apartment project in the Central West End neighborhood in St. Louis.

Cullinan Properties bought the Euclid Plaza building at 625 North Euclid Avenue and plans to begin renovating it within weeks. A company official said Thursday the building should be ready for tenants by late next spring.

Planned are 87 studio, one- and two-bedroom apartments with granite counters, “designer” bathrooms and 12-foot ceilings, the developer said. Indoor parking, a fitness center and a rooftop deck with a clubhouse for residents are part of the project. Cullinan calls the development the Lofts@Euclid. (Post-Dispatch)

The project should be completed by Summer, see my posts on their Streets of St. Charles project here & here.

The central lobby was very dated looking, but that’s all gone by now. I’m just glad to see the hideous fixed windows being replaced.

— Steve Patterson

Monogram Building, Formerly CPI Headquarters, To Become Loft Apartments

It’s time to stop calling the 9-story building at 1706 Washington Ave the “CPI” building. It has been a few years since the failed portrait studio operator occupied the building. For decades it was known as the Monogram Building, located within the Washington Avenue Historic District on the National Register, here are a couple of quotes from the listing:

The Monogram Building, rising nine stories, is a concrete-frame factory-warehouse extending eight bays on the east, elevation (facing 17th St. and 10 bays on the north (facing Washington). On both elevations, cream colored, glazed terra cotta, fashioned into shells, bound sheaves of wheat, caducei , and -foliated patterns, faces the narrow piers and spandrels which -frame triple windows . The end bays are sheathed in red brick and demarcated by terra cotta quoining. Above the two-story base, there is a foliated, bracketed cornice of terra cotta. The facade terminates with round arches formed bv the piers above the ninth story. A terra cotta cornice crowns the facade. 

and…

Rosenthal-Sloan, the “world’s largest millinery establishment,” occupied the Monogram Building at 1700 Washington constructed in 1910.” Numerous other millinery companies occupied quarters within the District and, according to one source, St. Louis was the largest millinery market in the country. ‘ Specialty items, junior dresses, for example, originated on Washington Avenue. Fashion shows were held first yearly and then twice yearly attracting thousands of buyers to the City. Large and small firms alike and the many out of town concerns that maintained offices and showrooms in the district flourished.

Before the Monogram was built in 1910, the site had already made history in St. Louis. Washington University in St. Louis, founded in 1853, opened its first building, Academic Hall, on the site on September 8, 1856. At the time, Lucas Place, now Locust St, was home to the city’s finest mansions.

Fol­low­ing the cholera epi­demic and fire in 1849, wealthy cit­i­zens became con­vinced that it was no longer desir­able to live in down­town St. Louis. James Lucas and his sis­ter Anne Lucas Hunt soon offered a solu­tion. They devel­oped the idea of the “Place,” a neigh­bor­hood with deed restric­tions that ensured it remained apart from the city and gen­eral pop­u­la­tion. The main thor­ough­fare was aptly called Lucas Place. Orig­i­nally Lucas Place (now Locust Street) extended between 13th and 16th streets when the city lim­its were just one block to the west between 17th and 18th streets. When estab­lished, Lucas Place was west of the devel­oped por­tion of the city, mak­ing it St. Louis’ first “sub­ur­ban” neighborhood. (Campbell House Museum)

The first mansion, built in 1851, was the Campbell House — the only mansion still standing.  The university occupied Academic Hall at 17th & Washington, and other buildings, until moving to its current campus in 1905. By the time the Sanborn Fire Insurance Map Co documented these blocks in February 1909, Academic Hall had already been razed.

The Monogram Building, built 1910-12, was designed by architect Albert B. Groves (1868-1925). Groves and his family lived at 5419 Maple Ave, built in 1906.  There are two entries for him in findagrave.com — here and here. Their son Theron A. Groves was also an architect.  Albert died weeks before his 57th birthday, Theron died at 65 — the wife & mother lived to 95!

This building is important to me, for 8+ years it has been a significant part of the view from my loft & balcony.

The Monogram Building has likely had many occupants over the last century, with a variety os uses. In January it was sold:

Revive Capital Development LLC, of Kansas City, bought the nine-story building from downtown St. Louis property owner David Jump. John Warren, a vice president of commercial real estate company JLL, represented Jump’s 1706 Washington LLC in the sale that closed Monday. No financial terms were revealed.

JLL said Thursday the new owner plans to put loft apartments in the former CPI headquarters at 1706 Washington Avenue. Efforts to reach a Revive representative were unsuccessful. (Post-Dispatch)

Hopefully this new Kansas City firm will be successful. The LLC’s sole listed organizer is real estate attorney Michael D. McKinley, a partner at the law firm Lathrop & Gage.

It’ll be interesting to see how Revive Capital Development configures the residential units, allocates parking, uses the ground floor. Hopefully one or two of the Washington Ave entrances will be for a restaurant or retail space, with the addition of an ADA-compliant ramp.

— Steve Patterson

Green Street Development Updating Building At Jefferson Ave & Market St

In 2014 Green Street Development bought a vacant building at Jefferson Ave & Market Street, originally built by AG Edwards, now Wells Fargo Financial. Last year they signed web developer Avatara as the main tenant, click here to see their webpage on the project. Construction on a new entry is now underway.

I never liked the corner tower, so I’m glad it is gone. Looking forward to seeing the final results.

— Steve Patterson

$4.1 Million Dollar Judgement Against Owner of Condemned Parking Garage

In July 2014 the parking garage at Tucker & Locust closed for repairs. It seemed routine at the time.

It turns out the damage to the post-tensioned structure was more extensive than originally known. Since my original July 2014 tweet, I’ve posted quite a bit about it:

• December 2014: Parking Garage Undergoing Time-Consuming Multi-Million Dollar Restoration; Businesses Closed, Jobs Lost
• April 2015: Parking Garage Repairs Halted, Emergency Structural Condemnation Issued
• July 2015: Car Hit Planters & Scaffolding Outside Condemned Parking Garage
• July 2015: Readers: New Building Should Replace Condemned Parking Garage
• January 2016: Court Documents Shed Some Light On Condemned Parking Garage

Central Parking System, who operated the garage, sued the owners — two LLCs that begin with Tucker Parking.  Tucker Parking countersued.

On March 22nd Judge Dowd ruled:

JUDGMENT IN ACCORDANCE WITH THE FINDINGS OF FACT AND CONCLUSIONS OF LAW SET FORTH IN THE COURT’S ORDERS OF OCTOBER 13, 2015 AND JANUARY 21, 2016, WHICH THE COURT EXPRESSLY INCORPORATES HEREIN, THE COURT ENTERS JUDGMENT AS FOLLOWS:

1. BY AGREEMENT OF THE PARTIES, THE COURT DISMISSES PLAINTIFF CENTRAL PARKING SYSTEM OF MISSOURI, LLC’S CLAIMS AGAINST DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC AND DECLARATORY JUDGMENT (COUNT I) AND BREACH OF LEASE (COUNT II) WITHOUT PREJUDICE.

So Central lost on their first two counts against Tucker. Let’s continue…

2. ON PLAINTIFF CENTRAL PARKING SYSTEM PARKING SYSTEM OF MISSOURI, LLC’S CLAIM AGAINST DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC FOR UNJUST ENRICHMENT (COUNT III), THE COURT ENTERS JUDGMENT IN FAVOR OF PLAINTIFF CENTRAL PARKING SYSTEM OF MISSOURI, LLC AND AGAINST DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC IN THE AMOUNT OF FOUR MILLION ONE HUNDRED SIXTY-ONE THOUSAND FOUR HUNDRED TWENTY-FOUR DOLLARS AND SEVENTY-SIX CENTS ($4,161,424.76).

Ouch. What is “unjust enrichment” anyway? The Wax Legal Dictionary defines it as:

The retention of a benefit conferred by another, that is not intended as a gift and is not legally justifiable, without offering compensation, in circumstances where compensation is reasonably expected. 

The elements of a cause of action for unjust enrichment are:  the enrichment of the party accused of unjust enrichment; that such enrichment was at the expense of the party seeking restitution; and the circumstances were such that in equity and good conscience restitution should be made.  An additional requirement is that the party accused of unjust enrichment must know of the benefit conferred; to ensure that the benefit was not foisted on the recipient and is something for which compensation is reasonably expected.

Recovery on a theory of unjust enrichment typically occurs where there was no contract between the parties, or a contract turns out to be invalid.

The specifics of this principal aren’t clear to me from the ruling.

3. ON DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC’S COUNTERCLAIM AGAINST PLAINTIFF CENTRAL PARKING SYSTEM OF MISSOURI, LLC FOR BREACH OF LEASE (COUNT I), THE COURT FINDS IN FAVOR OF PLAINTIFF CENTRAL PARKING SYSTEM OF MISSOURI, LLC IN PART AND IN FAVOR OF DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC IN PART. SPECIFICALLY, TO THE EXTENT DEFENDANTS BASE THEIR BREACH OF LEASE CLAIM ON CENTRAL PARKING’S ALLEGED OBLIGATION TO REPAIR THE GARAGE’S POST-TENSIONING SYSTEM BEFORE THE END OF THE LEASE TERM, THE COURT FINDS IN FAVOR OF PLAINTIFF CENTRAL PARKING SYSTEM OF MISSOURI LLC. TO THE EXTENT DEFENDANTS BASED THEIR BREACH OF LEASE CLAIM ON CENTRAL PARKING’S ALLEGED OBLIGATION TO REPAIR DETERIORATION OR DELAMINATION TO THE GARAGE’S CONCRETE SURFACE BEFORE THE END OF THE LEASE TERM, THE COURT FINDS IN FAVOR OF DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC. HOWEVER, THE COURT FINDS THAT TUCKER CANNOT PROVE ANY DAMAGES FOR THIS BREACH BECAUSE, AS SET FORTH IN THE COURT’S ORDER OF OCTOBER 13, 2015, THE GARAGE IS AT THE END OF ITS USEFUL LIFE, THE GARAGE’S POST-TENSIONING SYSTEM IS BEYOND REPAIR, AND THE FAILURE OF THE POST-TENSIONING SYSTEM WAS DUE TO NORMAL OR ORDINARY “WEAR AND TEAR.” AS A RESULT, THE COURT ENTERS JUDGMENT IN FAVOR OF PLAINTIFF CENTRAL PARKING SYSTEM OF MISSOURI, LLC AND AGAINST DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC.

Above we can get the message — the garage can’t be repaired.

4. ON DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC’S COUNTERCLAIMS AGAINST PLAINTIFF CENTRAL PARKING SYSTEM OF MISSOURI, LLC FOR WASTE (COUNT III), NEGLIGENCE (COUNT IV), AND DECLARATORY JUDGMENT (COUNT V), THE COURT ENTERS JUDGMENT IN FAVOR OF PLAINTIFF CENTRAL PARKING SYSTEM OF MISSOURI, LLC.

5. BY AGREEMENT OF THE PARTIES, THE COURT DISMISSES DEFNDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKING EQUITIES, LLC’S COUNTERCLAIM AGAINST CENTRAL PARKING CORPORATION FOR SUIT ON GUARANTY (COUNTII), WITHOUT PREJUDICE.

6. COSTS ARE ASSESSED AGAINST DEFENDANTS TUCKER PARKING HOLDINGS, LLC AND TUCKER PARKINGS EQUITIES, LLC PURSUANT TO RULE 77.01. SO ORDERED: 32929-JUDGE DAVID L. DOWD

So who owns this garage, who is behind these two Tucker Parking LLCs?

Both were created in Missouri on April 19, 2007, indicating a home state in Delaware. TUCKER PARKING EQUITIES LLC was formed in Delaware two days earlier. City records indicate tax bills are mailed to 24 Church Street, Montclair NJ.

The legal battle may continue for a while. Still, we can accept some facts:

• The existing garage is unusable, it’ll need to be razed eventually.
• The owner isn’t in St. Louis.
• The owner of the adjacent former Post-Dispatch building would like to have parking for tenant use.
• Many downtown residents, myself included, don’t want any surface parking or even more obvious parking garages.

I contacted 7th Ward Alderman Jack Coatar via email, who said:

It is my understanding that this garage has reached the end of its lifespan and that it would be extremely expensive to shore up this garage and make it safe to use. I would like to see the garage demolished and replaced with another parking structure that includes a first floor retail component.

I would like the development committee of the Downtown Neighborhood Association’s Planning and Zoning Committee to take an active role in the planning for any future use of this site.

If a new garage is built, I’d like it to be enclosed with an exhaust system rather than being open.

— Steve Patterson