Real estate development firm Lincoln Harris is planning to purchase The Charlotte Observer’s uptown site, two sources said Tuesday, a move that would open the door for major redevelopment along South Tryon Street.
The deal remains tentative, with one source saying the sale could close early in the second quarter this year.
Lincoln Harris, led by Charlotte native Johnny Harris, is one of the city’s most prominent development firms. The company has spearheaded major projects such as Phillips Place in SouthPark, and a predecessor company developed the Bank of America tower uptown. The Harris family also developed Ballantyne.
Harris and a company spokesman didn’t respond to requests for comments Tuesday.
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The 9.4-acre site is owned by the pension fund of McClatchy Co., the Observer’s parent company. The pension fund – not McClatchy or the Observer – is handling the sale, and Observer executives have not been part of the negotiations.
The property includes the newspaper’s main building, parking lots and warehouse space along Stonewall and South Tryon streets.
Earlier Tuesday, the Observer reported that a sale of the property was close, with negotiations down to a final buyer selected from a field of about 10 local developers.
Jim Bishop, managing partner of WhiteStar Advisors in Boca Raton, Fla., oversees the property on behalf of the pension fund. Bishop confirmed that negotiations with the final buyer candidate have been ongoing for about six weeks, but he declined to comment Tuesday on the report that Lincoln Harris is planning to purchase the building.
Other sources said the bidding process has been ongoing for some time. One person said bids for the property had reached as high as $35 million. Development on such a property would likely include retail, residential and office uses, although it could take 10 to 15 years to complete, this person said.
“It will redefine the gateway from South End into uptown and from uptown into South End,” the source said.
High-profile developers looked at site
A number of high-profile developers and real estate firms, including Trinity Capital Advisors and Daniel Levine of Levine Properties, told the Observer Tuesday they had looked at the property in recent months for potential projects but decided not to purchase the site.
“We’re fully committed on the north side,” said Levine, whose firm is developing First Ward Park at Seventh and Brevard streets. The park is part of a long-term plan to redevelop nine blocks long dominated by parking lots into an urban village with $1 billion worth of new offices, shops, homes and hotels.
Lincoln Harris already has other big Charlotte projects in the works. The company has filed plans to rezone a 188-acre former golf course off Providence Road to build offices, shops, a school and hundreds of houses, and it’s building the Capitol Towers at Carnegie, two 10-story office towers behind Piedmont Town Center in SouthPark.
CEO Johnny Harris formed Lincoln Harris in 1999 as the result of a merger with Lincoln Property Co. of Dallas.
Harris, grandson of former North Carolina Gov. Cameron Morrison, grew up in what is now SouthPark with brother Cameron Harris and sister Sara Harris Bissell. He helped clear land, sell homesites and bring in office and retail tenants for about 900 acres first envisioned as SouthPark decades ago by his father, the late James J. Harris.
Size poses challenge, opportunity
Some development experts said the trait that makes the Observer site so compelling – its size – also makes it challenging to develop.
“It’s such a large assemblage,” said Michael Smith, CEO of Charlotte Center City Partners. “The challenge is, it’s over 9 acres.”
For comparison, new 25-story office tower 300 South Tryon will occupy 1.6 acres, Romare Bearden Park sits on about 5 acres and the Charlotte Knights baseball stadium occupies about 8.5 acres.
But the South Tryon corridor has seen a surge of growth in recent years, with the opening of the Knight Theater, three museums and the Duke Energy Center. Childress Klein recently announced plans to build a 42-story apartment tower atop the Mint Museum, and Crescent Communities plans to start construction this summer on a 27-story office tower across Tryon Street from the Observer site.
Brian Leary, president of Crescent’s commercial and mixed-use business unit, said the redevelopment is proceeding quickly on the city’s south side because large tracts are in play.
“That’s the beauty of the South Tryon corridor,” said Leary. “You have blocks – not just sites, blocks – that are available for redevelopment.”
The pending sale of the Observer site comes almost a year after the company shut down its presses on the main building’s first floor and transferred printing operations to a press facility in University City. News, advertising and administrative functions remain at the Tryon Street site.
Observer executives have been searching for more modern offices uptown or close to center city, and are evaluating proposals. It’s unclear when the Observer would relocate after a sale.
Leary cautioned that while redevelopment plans are proceeding along South Tryon, the next wave will still take years to come to fruition.
“Big things are moving, and big things move slower,” Leary said. “Rome wasn’t built in a day. Neither was Charlotte.”