Metro Pulse/Insights/2001: A Knoxville Odyssey

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by Joe Sullivan

It's admittedly a stretch to draw analogies between Knoxville's downtown revitalization travail and Odysseus' quest to reclaim his throne, let alone to Stanley Kubrick's space odyssey. Yet efforts to restore vitality to the heart of the city that got sucked out by commercial emigration to suburban malls remain fraught with a plenitude of perils.

As 2001 commences, these efforts are focused on Worsham Watkins' ever so ambitious, $370 million redevelopment plan; but they by no means start or end there. As pointed out in a recent set of recommendations for proceeding with the WW plan that have emerged from this year's Nine Counties, One Vision process, the past 20 years are littered with abortive downtown redevelopment proposals.

Now, the WW plan, after more than two years of formulation and review, must be set in motion soon or else itself get littered. Yet even with the qualified backing of Nine Counties, One Vision accompanying that of the Knoxville Area Chamber Partnership and civic booster groups, there are many causes for concern standing in its way. Indeed, as the Public Building Authority prepares in January to make recommendations on the terms of a public/private partnership involving up to $130 million in public funding, any deal approved will have to resolve a long list of sticky issues. These include:

* WW's insistence on seizing control over Market Square from its property owners in order to orchestrate total redevelopment as a shopping, dining and entertainment complex.

* WW's penchant for channeling pedestrians through elevated, glass-enclosed, climate-controlled walkways instead of on the streets. This seems to fly into the face of, if not thumb its nose at, one of the guiding principles of an Urban Land Institute report on which initial planning was based. Indeed, the PBA itself has previously invoked a ULI maxim for downtown revitalization that, "The strategy is simple: more residents, office workers and visitors walking around downtown."

* WW's inability to date to secure two of the prime attractions in its proposal: a Scripps Cable (HGTV) center and a cineplex. Without their drawing power, all the more doubt is cast on the entire development's ability to attract the critical mass of visitors needed to produce all of the sales tax generating activity that is supposed to cover the cost of the city's presumed $130 million investment in supporting infrastructure.

* WW's proposed location of a new convention center headquarters hotel more than three blocks away from the city's new $160 million convention center casts all the more doubt upon the center's viability. Provision for the above-mentioned enclosed walkways that were supposed to facilitate movement between the two is now very much in doubt as well, reinforcing the case for proximity that is based on the experience of many other cities.

* WW's credentials as developer of an undertaking of this scope are questionable. Earl Worsham has far more experience than Ron Watkins with large scale public/private partnerships, but Worsham's track record with hotel developments in other cities is spotty. Hotels in Miami, Fort Wayne and Little Rock, while all of high quality, have all run into financial difficulties, disputes among their owners and subsequent resales.

* WW's proposed up-front development fees totaling $36 million are exorbitant by any standard.

For all of that, the case for proceeding with downtown redevelopment based on the WW plan remains compelling. A Downtown Knoxville Action Plan emerging from the Nine Counties, One Vision process states that, "Citizens have overwhelmingly stated the region needs a healthy and vibrant urban heart, as evidenced by the fact that the Downtown Knoxville Goal was the most voted-for single goal at the Nine Counties, One Vision, Vision Fair." In furtherance of that goal, the action plan concludes that, "Proper implementation of the WWI development proposal would contribute positively to success on the Nine Counties, One Vision Downtown Knoxville's goal." The action plan also recommends that, "Simultaneously with the full design of WWI's project, a master plan of all downtown and the contiguous neighborhoods should occur...in order to assure the greatest potential of maximum spin-off development."

When the city, through the PBA, was seeking a downtown redevelopment firm, WW was the only one to respond with a comprehensive proposal. While other developers continue to shake their heads with some combination of admiration and dismay at the boldness of WW's proposal, Worsham and Watkins have devoted more than two years to trying to make it a reality. And there have been enough independent reality checks to assure that it's not just derring-do on their part. For example, a pre-eminent hotel consulting firm, PKF, attests to the viability of the 415-room Marriott Hotel that is proposed. The ULI report itself envisioned a new 500,000 square foot office building that has been incorporated into WW's grand design. And all of the financial underpinnings of the deal, including the city's return on its investment, are being independently evaluated by Economic Research Associates, a Chicago-based consulting firm.

Even if large elements of the plan suffer financial failure in the short-run—due to over-optimism, a recession or whatever—the city will be better off in the long run for getting new hotel, office, commercial and residential enhancements to its building stock. The three hotels built at the time of the World's Fair all took a bath financially thereafter, but all are prospering today. The same holds true for the city's two largest office buildings, First Tennessee and Riverview office towers. And the city itself was left temporarily in dire financial straits by the $50 million debt incurred to acquire and develop the World's Fair site. But what we have to show for it today is, to invoke the ULI report again, the makings of a world class urban park that should "be the defining image of Knoxville."

A recent report to the PBA by consultants from RTKL Associates and Urban Engineers provides a blueprint for proceeding in a way that accentuates the positives of the WW plan while disaccentuating the negatives. A phased approach is recommended under which a transformation of Market Square, an adjacent housing complex and the hotel and office tower would be implemented in phase one. All the glass enclosures, including a mall over Henley Street, would be held in abeyance at least until commitments have been secured for a cineplex and a destination attraction in the city's old exhibit center.

WW's critics give little weight to the financing, hotel operator and office tenant commitments that have purportedly been obtained, but these are crucial and must not be squandered, as they surely will be if the entire plan is subjected to any lengthy delays for further analysis.

The time has come for Knoxville to start making good on its downtown revitalization potential, as our neighbors in Chattanooga continue to do with recent commitment to a $110 million expansion of the city's trade and conference center that includes a new $20 million hotel financed entirely by the city.