Tuesday, September 22, 2009

Lucas Oil Stadium - Downtown Development Not Developing

Over at the Indianapolis Business Journal, writer Sam Stall has an excellent article about the fact that anticipated development around Lucas Oil Stadium, has not been happening as projected. It is an interesting article - one that belies the notion that professional sports drives development.

Stall writes in part:
Not long ago, developers seemed to vie for every square inch of open ground in the vicinity of the just-completed Lucas Oil Stadium.

A gaggle of midsize hotels were in the planning stages. A Dallas-based firm investigated purchasing a section of South Meridian Street property (including
the lot upon which Shapiro’s Deli sits) for a retail and residential project.

Even more dramatically, a $480 million development called Legends District-SoDo was slated to pack some 500 hotel rooms, 200 condos, a 3,400-seat theater and 175,000 square feet of retail space into the shadow of the football stadium. For a while there, downtown’s far-south side seemed set to become a “destination” neighborhood.

What a difference a couple of years—and the worst economic downturn in decades—makes. These days, the entire neighborhood has been pushed, if not into a financial deep freeze, then at the very least to the back of the crisper drawer.

According to Abbe Hohmann, senior vice president and principal at the Indianapolis office of Colliers Turley Martin Tucker, the area suffers from the same triple whammy faced by most development “hot spots” these days: no available credit for projects, a terrible economic environment, and an excess of existing construction stock in practically every category.Also, there’s little demand for the retail, residential and entertainment envisioned for the area, Hohmann said.
While Hohmann puts the blame on the economy, Tim Dora, partner, in Dora Hotel Co., which owns several properties, including a parking garage and two new hotels, near Lucas Oil Stadium, offers a contrary view.

“They thought they’d hit the lottery. I don’t think that was the case.”


[He] is somewhat more circumspect about the area’s prospects, economic recovery or no. He never thought Lucas Oil Stadium could be a reliable engine for a retail and residential renaissance.“

"Some of it had to do with comparable projects like United Center in Chicago. If you look at how it impacted the neighborhood around it, you really didn’t see anything like what was talked about here,” Dora said. “Even Conseco fieldhouse, if you look at how it impacted the surrounding neighborhood, it doesn’t seem like it was really the stimulus for any of that [development]. What’s around Conseco happened on its own.”

Indeed, he thinks the presence of a massive sports venue—and the massive crowds and traffic snarls it generates—hardly qualifies as an attraction.“

It’s almost more of a negative than an asset for most commercial uses,” Dora said. “Just because of the periodic traffic and noise and crowds. If you lived there, I don’t know if the tailgating is going to turn you on, or having people crawling all over your place 10 nights a year.”

Between Dora and Hohmann, it appears that Dora better understands the nature of professional sports stadiums. The fact it these stadiums are never the development tool the promoters claim they would be when sold to the public, with taxpayers and not the private sector, footing the bill.


jabberdoodle said...

This is the very reality that the Council and the Mayor need to accept. Throwing more money at the purported economic engines without examining how much is hype and how much is fact, is just throwing good money after bad and passing the problems along to the next administration.

Downtown Indy said...

Dora utters an important phrase, 'ten nights a year.' 10 out of 365 is not going to develop a whole lot of anything.

I recently scanned the indy.gov property tax maps and the whole of downtown, particularly around LOS, has dropped '10% or more' or in a few cases is break-even. This is in contrast to outlying areas where the trend was to higher rates.

Indy Student said...

I remember reading an article in the Star, years ago, saying that the stadium wasn't attracting business like it was hoped to do, with only several small projects in plan and only one restaurant being opened.

As an IUPUI student, I've got archives access for the Star. I'll try to dig up the article.

Unigov said...

Told ya so ! There was hardly any development around the RCA Dome for 20 years - why would there be any development around a different NFL stadium ? The place is so HUGE that 350 days out of the year, it's just a big empty space.

Also, the new airport isn't working out as expected, since there's not much reason to fly to Indy. They are scrambling to find money, and if they things get so bad that they can't pay back their bonds, Indy taxpayers will have to.

Fort Wayne just swiped four of Indy's smaller conventions.

The old Market Square site is still a gravel parking lot.

Washington Square could go poof at any moment, once Sears closes.

A whopping 7 dates booked at Conseco this month - there's 60,000 seats filled.

The new Wishard will create yet another rush of construction jobs, then they'll have to start looking for something else to tear down and replace. Like, the old post office.

Downtown Indy said...

By the way, whatever happened to the 'required' additional VIP parking for LOS? They were at one point wanting to build a parking garage. Haven't heard anything about that for a long time.

There was also some rumblings about taking over the post office block, so Unigov hints at another project that seems to have been cloaked in silence.

How many 'other shoes waiting to fall' do you suppose came with LOS, that we should still be braced for?

Unigov said...

I mentioned the old post office ut I had really meant the old city hall, where the state museum used to be.

Lo and behold, something must be DONE about the old city hall:


First step toward tearing it down.