When developer Tom Hendrickson unveiled plans for his massively ambitious real estate project Veridea in mid-2009, it seemed only natural to wonder whether he'd been living in a cave.
After all, what Hendrickson's firm, Lookout Ventures, was proposing to build in Apex was exactly the sort of project that the economic downturn and the accompanying credit crunch was supposed to have made obsolete.
Veridea, as envisioned by its developer, would cover more than 1,000 acres and include up to 10 million square feet of offices, 3.5 million square feet of shops, 2 million square feet of manufacturing and 8,000 homes. "A next-generation version of the world-renowned Research Triangle Park," as Hendrickson described it at the time.
Two and half years later, Veridea still faces a host of challenges. But it's also true that Hendrickson's timing is starting to look a whole lot better.
Last week, Lookout paid $8.2 million for 114 acres of Progress Energy land along Old Holly Springs Apex Road.
"This puts us over 1,100 acres," he said, referring to the amount of land his group has purchased or put under contract. "This gets us about what we need."
It also gives the project something even more valuable: land around where a future Western Wake Expressway interchange could be built.
The Progress Energy tract was originally 136 acres, but 22 acres of it was condemned to make way for the turnpike. A 3.7-mile section of the toll road opened earlier this month, and the entire 18.8-mile extension is expected to be completed by December 2012. "That's something that our timing has been designed to dovetail with," Hendrickson said.
The road is already spurring new home construction in both Apex and Holly Springs, where new building permits are up 63 percent through the first 10 months of the year.
When the turnpike is complete, it will have 11 interchanges. Adding one eventually at Old Holly Springs Apex Road is under discussion, though it's unclear when it might get built or who would pay for it.
The developers behind Wendell Falls, another massive development proposed in Eastern Wake County, paid $25.5 million for an interchange to be built off the U.S. 64 Bypass.
The interchange opened in November 2009, but the project has since gone bankrupt. Lenders are now trying to find a buyer for all the land the developers assembled.
Veridea's land-use plan was approved by Apex officials in May. The area has remained largely undeveloped until now because of its soil and topography. Its soil makes it unsuitable for well and septic systems And because the land drains away from Apex, it is costly to extend water and sewer service into the area.
'We're very different'
Hendrickson is adamant that Veridea will be unlike anything that has come before it.
"We're very different than the traditional suburban-scale [planned unit developments] that people are used to seeing," he said.
The development will have its own form-based zoning code, which regulates exterior appearance rather than potential uses for a piece of property. Many municipalities have been turning to such an approach in an attempt to combat sprawl and make their cities more walkable.
Hendrickson said Lookout's intention is to develop the commercial component first. What area of the Veridea gets developed first will likely depend on where Lookout decides to place the pump stations that will be required to bring water and sewer service to Veridea.
Hendrickson said Lookout is now in discussions with potential occupants for the commercial areas. Given the project's size, it will be crucial to get a few major retailers or employers to sign on in order to create momentum.
And even though it is expected to take 15 to 20 years to build out, Veridea needs the economy to improve significantly. Projections call for Veridea to add 20,000 new residents, 30,000 jobs and $6 billion in tax revenues to Apex's coffers.
At the moment, it's hard to see where the demand will come from given that few companies are hiring, consumer spending is down, demand for new homes is at near historic lows and bank financing remains hard to get.
By now, Hendrickson is used to people thinking he was crazy to have launched Veridea when he did.
But he said Lookout, which has already spent tens of millions of dollars acquiring the land for Veridea, doesn't have to worry about its lenders getting impatient. The land is debt-free, having been purchased with money from investors.
"Things are coming around," he said. "We've got great and patient partners on it, so we're making sure that the first step is the right step."
