Wake County

Developer aims to finish Stone's Warehouse by 2016 as Raleigh agrees to sell

Stone’s Warehouse sits boarded shut in downtown Raleigh in December. Council members voted Tuesday to sell it for development.
Stone’s Warehouse sits boarded shut in downtown Raleigh in December. Council members voted Tuesday to sell it for development. cseward@newsobserver.com

Stone’s Warehouse is set to become one of the largest redevelopment projects the city has seen, and perhaps the surest sign of East Raleigh’s accelerating economic change.

The Raleigh City Council unanimously agreed on Tuesday to sell the sprawling, vacant building to Transfer Company LLC. The matter will return later for a public hearing and final approval of a purchase agreement, where some local leaders and advocates may air concerns about the development.

Transfer is led by a team including “hyper-local” developers Jason Queen, Will Jeffers and Matt Flynn, who have largely focused on what they call Olde East Raleigh. They’re joined by Steve Schuster, the founder of the Clearscapes design firm.

“I’m happy for the community. I live in the community, not even a block away from the site,” Queen said on Tuesday afternoon. “I’m really excited that we were essentially able to bootstrap this development with the community’s backing.”

The proposal would pack the warehouse and adjacent property on the 500 block of East Davie Street with a neighborhood grocery store and cafe, a community hall and space for a handful of small food producers.

Among them would be Videri Chocolate Factory, Locals Seafood, Jubala Coffee, Boulted Bread and an “incubator kitchen” run by HQ Raleigh, according to Transfer. They share a “social” mindset, Queen said.

The project also would include a new 13,000-square-foot building, potentially for use by Trophy Brewing and Pizza Co., and a row of 16 townhouses. Queen estimates construction could begin within a year, and he hopes for an opening in the first quarter of 2017.

Transfer’s plan, which beat out two competitors, drew criticism for its lack of designated affordable housing; the city has aired previous plans to have rent-limited residences in the old warehouse.

“The whole thing now is going to be driven just by the development community. There’s not really any other opportunity site that’s going to come up that’s going to make any difference anyway,” said Daniel Coleman, head of the South Central Citizens Advisory Committee.

Instead, the proceeds of the sale – about $2 million – will fund community development programs centered in Southeast Raleigh, potentially helping other developers build income-limited housing.

The Transfer plan also doesn’t leave room for Rex Senior Health Center, now in an adjoining building on the warehouse property. However, Transfer has promised to provide “architectural services” and help finding a new lot, according to city staff. At least one potential site is within a block.

“We’re talking about people without transportation,” said Councilman Eugene Weeks, who voted for the sale after reassurances from staff.

Queen said his team aims to integrate its development with the surrounding neighborhoods. The grocery store will aim to draw people from across the area, but will also cater offerings to its community.

Coleman, however, said that neighbors and the area’s citizen committees hadn’t had enough chances to comment on and shape the development. He thinks Weeks should have pushed harder for residents’ involvement; Weeks said the coming public hearing would be a good chance to weigh in.

Now city staff will prepare a purchase agreement, which the council will again review. The selling price is based on an appraisal of the land, according to staff.

The developers already have arranged the project’s financing, according to their proposal.