Residential-commercial Plan Gives Historic Entity New Life
Without help, developer Ted J. Duckworth would have never dreamed of renovating the Electric Building in downtown Jackson.
A tax break from the city of Jackson and Hinds County, and a federal program that gives tax credits for investments in buildings eligible for the National Register of Historic Places spurred the $14.8 million renovation planned for the downtown building.
"Projects of this type are a result of thinking outside the box," said Duckworth, president and managing broker of Duckworth Realty.
Under the Proposal, Duckworth Realty, which is buying the building from Entergy, will not have to pay taxes on the value of the improvements for 10 years.
Plans call for the Electric Building to be designated part of the Smith Park Architectural District so the project can qualify for the federal historic tax credits.
Elbert Hilliard, state historic preservation officer and director of the Mississippi Department of Archives and History, said the tax credit program encourages private investment and preservation of historic buildings.
In fiscal 2003, the Department of Archives and History's Preservation Division processed investment tax credit projects representing $8.8 million in private capital expenditures on income producing buildings listed or eligible for the National Register of Historic Places, he said.
"Since the U.S. Congress initiated the investment tax credit, our Historic Preservation Division has processed 556 certification reviews for projects totaling $98.58 million in private capital expenditures," he said.
John Lawrence, president of Downtown Jackson Partnership, said odds are good that the investment tax credit could equal 20 percent of allowable construction costs.
"It can be used by the developer if he has a tax burden to offset taxes owed," he said."its very common."
Jackson Mayor Harvey Johnson said the city's involvement is still being determined, but it could entail a tax reduction and assistance with demolition to gut the building so new electrical and air-conditioning systems could be installed.
"We're looking at those details and will know very soon what that level of involvement will be," he said.
Johnson said the project is important to preserve, stabilize and revitalize downtown Jackson.
"The plans for the building will be a model for others to follow," he said. "The idea of residential and commercial dwelling in this building very exciting. This kind of project is part of a national trend that has been successful across the country."
Plans call for placing 15-16 luxury apartments on the top two floors - along with a rooftop garden - and retail space on the bottom floor.
Duckworth Realty will manage the building, and Entergy will lease five floors. Trustmark National Bank is providing financing.
Carolyn Shanks, president and chief executive officer of Entergy Mississippi, said the renovation should pump new life into downtown. "This will jump-start renovation of downtown Jackson," she said.
Shanks said Entergy has called the Electric Building home since 1930, but only 60 employees currently work there, compared with the 400 it once housed.
"We looked at a lot of options," she said. "One of those did include moving out of downtown Jackson."
Construction should begin in April 2004 and tenants should move in by July 2005, said Richard McNeel, Partner with Johnson Bailey Henderson McNeel Architects in Jackson.
Plans call for returning the exterior of the 10-story building located at East Pearl and West streets to the way it looked in the 1930's when it was new, and for updating the interior, he said.
Johnson Bailey Henderson McNeel plans to move its office from the Quarter on Lakeland Drive to occupy a floor of the Electric Building, McNeel said.
Duckworth said he expects the building to be fully leased after the renovation.
"we're trying to identify potential retailers, something not here in downtown," he said. "It would be so neat if we could have a coffee shop, snack shop, soda fountain and sushi bar."
Duckworth said a parking garage would complement his project. "We need for the city and county to work together on a parking garage." He said.
J. Walter Michel of Jackson, who operates the commercial real estate company known as the J. Walter Michel Agency, said all of downtown should benefit from the improvements to the building. Michel's grandfather moved to Jackson in 1927 to manage the Electric Building - then called the Lampton Building - when it was under construction.
"Any time someone pours capital back into downtown Jackson it helps the overall market," he said.
Lawrence said the renovation project will place an additional 200 employees and 15-30 residents downtown. "Only six months ago we were looking at a building severely underutilized and at true risk of going vacant," he said.
Apartments: Downtown location popular
Duckworth said he plans to make available to tenants such services as a concierge, valet parking and dry-cleaning delivery.
Duckworth said he'd like to furnish several of the apartments and make them available for law firms and other businesses to rent when they have visitors in town.
John Lawrence, president of Downtown Jackson Partners, said it's common for his office to hear from metro residents and newcomers who'd like to live downtown.
"Filling those units is not going to be a problem," he said.
Elbert Hilliard, director of the Mississippi Department of Archives and History and state historic preservation officer, said several cities in the state have been successful in getting people to live downtown.
"In Columbus you have a lot of the going on, as will as Natchez," he said.