Drone video: Kane Realty ready to buy 6 acres near Union Station
Six months after revealing it had more than six acres of land under contract near Union Station in downtown Raleigh, John Kane’s real estate company has submitted a rezoning application that could potentially allow for the construction of a 20-story tower.
The property — currently owned by the construction company Clancy & Theys — is made up of two blocks of low-slung buildings and parking lots on Cabarrus Street. It’s also just across the railroad tracks from Kane Realty’s biggest downtown project to date, the 17-story The Dillon.
The sale of the property is contingent on the rezoning application, Kane said, but what his company eventually builds there is still somewhat uncertain.
“We don’t want to get too far ahead of ourselves,” he said in an interview with The News & Observer on Wednesday. But Kane is asking for the ability to build up to 20 stories on part of the property, which is currently only zoned for up to seven stories.
Kane said the company wants flexibility to be able to match what the market demands, noting his company originally asked for 20 stories of height at The Dillon but eventually only built 17 stories.
Kane only wants that height to be on a portion of the property that is closest to the railroad tracks and West Street. Along, the west side of the property’s border with Dupont Circle and Cabarrus Street to its south, Kane would ask the city to keep the height limit at seven stories.
“We just think that is an appropriate height,” Kane said, because there are single-family homes across the street from that part of the property.
According to the rezoning application, the six-acre lot would be broken down into three tracts, with a separate building in each section. Though, Kane said, this is liable to change in the future.
The first section, closest to the railroad tracks, would be up to 20 stories tall with 350,000 square feet of office, 500 residential units and 50,000 square feet of retail.
The second section, in the southwestern part of the property, would be up to seven stories tall with 100,000 square feet of office space, another 500 residential units and 50,000 square feet of retail.
The third section, in the northwest corner of the property, would be identical to section two, except its office space would be larger at 200,000 square feet.
If all goes smoothly, the rezoning application could go before the planning commission in Spring 2019.
Kane said he was confident in forging ahead with the redevelopment of the Clancy & Theys property because of how successful The Dillon has been.
“We have been bullish on the Warehouse district anyway, but The Dillon’s office space is completely full now,” Kane said. Financial services firm Arch Capital recently leased four full floors in that building in August. “The way (Raleigh) is growing we will be in good shape.”
Both the office and residential market in the city “are tight,” Kane added. “Our residential leasing at The Dillon is over 70 percent, which is ahead of where we thought we would be at this time. ... The market is good. People are still moving in every day.”
Kane’s been busy in downtown
The Warehouse District isn’t the only part of downtown where Kane has been expanding his real estate empire. Along the quickly-changing Peace Street and Capital Boulevard corridor, Kane Realty has assembled several parcels of land near the company’s under-construction Peace project.
The Peace project will be the home of a Publix grocery store sometime in 2020.
To the east and south of that project, along Peace and North West street, Kane and Williams Realty Building Co. have bought up land for the next phases of the Peace project. Altogether, the project is part of a greater revitalization of the northern entrance to downtown, an area formerly called Smokey Hollow. The area is also getting a new 16-acre city park and greenway project.
“Our philosophy is that if we can change a whole area, then we want to do that,” Kane said of assembling blocks of property. “We want to recycle property, where you have got real estate that needs to be turned into something different than it is today. (The properties) were just outdated. They were single-tenant users, like a dry cleaners and a car wash ... and the whole area needed to be reinvented.
“Capital Boulevard has always been an eyesore,” he said. “Now we are going to have an entrance that we hope we can be proud of.”
The next phase of the project, along North West Street, will be another 200,000-square-foot building, which is just a little smaller than The Dillon, Kane said. The building would be mainly office space, but would also have apartments, similar to The Dillon set up, though Kane added the building’s design would obviously look completely different.
When all these buildings would be built, however, is up in the air, Kane said. Kane’s many projects, from North Hills all the way to the Warehouse District will all likely be stair-stepped in the coming years, Kane said.
“We will be careful about how much we put up at one time,” he said. “There is a lot of conversation (about all of the projects) but the timing is to be determined. We wouldn’t want to put too much supply up at one time.”