Developers are planning a major infill redevelopment project that would bring a mix of high-end retail, offices, apartments and a hotel to a 42-acre site along one of the busiest stretches of Glenwood Avenue.
The project, called Glenwood Place, would transform a section of the east side of Glenwood just inside the Beltline that is now home to a handful of nondescript office buildings that were constructed in the 1970s. The property is owned by developer Gordon Grubb’s company, Grubb Ventures, which is developing the project with Charlotte-based Lincoln Harris.
Glenwood Place is expected to be developed in multiple phases over several years, and total investment in the site could reach as high as $500 million. Such a level of investment would have been unthinkable a few years ago, but developers in the Triangle have been slowly gaining confidence as the economic recovery has gained steam.
That Glenwood Place includes a large office and retail component is notable in that the vast majority of new construction since the recession ended has been apartments.
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“It’s been apartments for the last three or four years and now office is starting to come in,” said Brian Reece, a partner with Karnes Research, a Raleigh firm that tracks commercial real estate trends.
Glenwood Place also reflects the shift over the past decade in the type of development sought by city officials and a growing number of Triangle residents. High-density projects where people can work, shop and live – such as Kane Realty’s wildly successful North Hills project – are now preferred over traditional single-use projects.
Preliminary plans for Glenwood Place call for 140,000 square feet of retail and more than a half-million square feet of office space. Grubb has approval to build a 292-unit apartment complex on the property, and plans additional apartments or condominiums.
Seeking high-end retail
Glenwood Place will seek to fill its retail space with luxury shops, many of which may not currently have a presence in the Triangle. Lincoln Harris has relationships with many such retailers, having developed much of the high-end retail around Charlotte’s SouthPark mall.
David Connor, a senior vice president for Lincoln Harris based in Raleigh, said the unique location and the demographics of the surrounding neighborhoods should make the project attractive to prospective retail tenants.
Grubb Ventures, meanwhile, specializes in redeveloping older infill residential and office properties. The company developed the recently opened 401 Oberlin apartments at Cameron Village.
The Glenwood Place developers met with neighbors this week and expect to submit a rezoning request as early as next week. They will seek to rezone the property from office and industrial to planned development, a new zoning category that will give them more flexibility in how the retail is presented and how the density within the project is dispersed. The zoning will also raise the maximum height of the buildings allowed to 195 feet, which would be roughly equal to a 12-story office building.
The project is likely to face concerns that it could exacerbate traffic problems in an area of the city that is already plagued by congestion at certain times of the day. It may also face opposition from surrounding homeowners who aren’t eager to have such intense development adjacent to their neighborhood.
In addition to getting city approval, Grubb will also need to secure financing for the project.
While investors have been willing to pour money into Triangle apartment projects in recent years, financing for new office and retail projects has been scarce. Most of the new office buildings now being built in the Triangle had half or more of their space pre-leased before breaking ground.
Another Glenwood project
Grubb and Lincoln Harris are the second developers in the past seven months to propose a project targeting luxury retailers along this stretch of Glenwood Avenue.
In May, a Texas developer, Trademark Property, unveiled plans for Carolina Row at Crabtree Valley – a $90 million project that would have added 175 apartments and as much as 150,000 square feet of retail and restaurants to a 10-acre site across from Crabtree Valley Mall.
But the future of that project now appears uncertain. Trademark, which had planned to break ground this spring, didn’t return a call seeking comment Friday. The project is no longer listed on the company’s website as one of the projects it has under development.
Reece, of Karnes Research, said the best thing Glenwood Place may have going for it is location. The office and retail vacancy rates in that area of Wake County are among the lowest in the Triangle, and the vacancy rate for apartments was 7 percent in September, below the 7.7 percent for the entire Triangle, according to Karnes.
“People do like to be along that Glenwood corridor,” Reece said. “ ... The location is absolutely fantastic.”
The only building now on the Glenwood Place site that would remain is the office building at 3700 Glenwood. The other eight office buildings, which contain about 250,000 square feet, would be demolished over time as different phases of the project move forward.
Grubb expects Phase One of the project to include the retail and hotel portions of the project.