Tuesday, June 27, 2006

On Shaky Ground?

Part of new Mud Island condos sit on landslide site

Memphis Daily News [link]
by Andy Meek

The development team that's building Flagship Condominiums on Mud Island still is tweaking plans for the project, which will be a continuation of the award-winning Harbor Town community.

But the finish line is getting closer. And once that happens, Flagship will have snatched up some of the last available waterfront on Mud Island, property near the Auction Street bridge that was once thick with trees. Part of the land also was the site of a massive landslide in 2002 and has been at the center of a variety of development schemes over the years.

Landslide victory

The main concept for the Flagship project - four buildings with at least 45 units - is well on its way through the approval process. Over the past few weeks, a flurry of changes and amendments have been made to the plan,which the Memphis and Shelby County Land Use Control Board recently approved and which first comes before the Memphis City Council this week.

The condos are going up on 2.65 acres at the southeast corner of Island Drive and Auction Avenue, on a small triangle of property across from the three-story Arbors Apartments complex in Harbor Town. On the other side, Atlanta-based Beazer Homes plans to build 175 townhomes on 19 acres that developer Kevin Hyneman recently sold to the company.

Hyneman also sold about half the Flagship property to a group that includes developer Henry Turley. Current plans for the Flagship project call for touches such as a decorative fountain near Island Drive, a pool and perimeter landscaping.

The project, which will be spread out over several phases, will feature mostly brick units and such amenities as semi-private elevator access.

"It should be nice," said attorney Ronald Harkavy, who's representing the developers. "Anything these guys have done out there has been nice, and they've tried to make others do the same."

Foundation of sand

This afternoon, the City Council will set the date for a public hearing on the Flagship development, which was part of 21 acres of woodsy land Hyneman bought for about $2.6 million in 2001.

"Basically, what the (LUCB) already approved is where we're heading," Harkavy said.

The condo units along Island Drive will range from 1,800 to 2,700 square feet. The units along Auction Avenue will range in size from 1,500 to 2,200 square feet.

The sale and transformation of the small Flagship property marks something of a milestone in Hyneman's career. Along with the larger tract Beazer is developing, it brings to a close Hyneman's involvement in development on Mud Island, where he's built close to 1,000 homes.

One of the most talked about episodes involving Hyneman during that time was the 2002 landslide, which took out a large swath of riverbank.

The landslide was the result of piling excavated dirt on the property that had been brought over from the FedExForum building site, the weight of which ultimately put too much strain on the harbor bank. The landslide occurred on the northeast side of Hyneman's 21-acre property, including a small portion of the Flagship site.

It happened days before a sale of the property was scheduled to go forward with a group that included the Riverfront Development Corp. and developers Turley and Jack Belz.

Since then, the entire site has been the subject of various real estate proposals. Don Jones, a city-county planner, said plans for the Flagship development are still in flux.

"They were approved by the LUCB for 45 condo units, but they want to bring that back up to about 52," he said. "They would also like to have one of the buildings permitted up to five stories."

When it's finished, Flagship Condominiums will enhance an already much-sought-after lifestyle on Mud Island.

Star-spangled home

Today, residents like Dianne Champlin put a premium on the amenities to be found there, where homes are set among well-manicured communities, pedestrian walkways and neighborhood businesses like Miss Cordelia's, a small grocery store with an eat-in deli.

"We love the outside," said her husband, Brad, of the couple's Harbor Town home, "Blithe Spirit." "This is where we have breakfast in the morning. Dianne and I will sit down here with a cup of coffee and a newspaper."

Gesturing toward the panoramic river view, he said: "Isn't that fabulous?"

Among the other recent additions to Mud Island, there's Harbor of Health, a new wellness clinic Dianne said she's eager to try out once she and her husband move to their riverfront home full-time. The 4,500-square-foot home includes features such as a private elevator and handicap accessibility, meaning doorways, for example, are tall and wide.

Dianne also is happily anticipating the Fourth of July, which she and her husband will celebrate with a few friends at their riverfront home.

"This will actually be our second Fourth of July here," she said. She recalled the celebration last year, when families packed the riverfront for picnics, strolled along the water and children played with festive holiday sparklers.

Construction work, meanwhile, remains a constant feature of the quiet life enjoyed on Mud Island by people like the Champlins. Public artwork, for example, soon will be added to a newly built traffic roundabout on Mud Island.

"And I think you should see something happening in the very near future to the south of (the Flagship) site, also," Harkavy said.

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Tuesday, November 08, 2005

Editorial: Hyneman's gifts carry a price

Commercial Appeal

"DON'T YOU THINK he's just a nice guy?" Memphis City Council member Barbara Swearengen Holt replied when questioned about help she and other elected officials have received from developer Rusty Hyneman.

There's no question Hyneman has quite a giving streak in him, at least where certain people with the power to help him later are concerned.

As a six-week investigation by The Commercial Appeal revealed, Hyneman helped Holt get a luxury skybox seat to a Memphis Grizzlies preseason game.

Hyneman co-signed on a loan so City Council Chairman Edmund Ford could lease a $50,000 Cadillac. Hyneman also bought a $1,200 airline ticket for Shelby County Commissioner Michael Hooks and one of Hyneman's business partners gave Hooks an interest-free $16,000 loan.

And these are only some of the more recent examples of Hyneman's "generosity."

When Jim Rout was still county mayor, he got a free ride in Hyneman's private jet. Hyneman also helped City Councilman Rickey Peete buy a new house and rented County Commissioner Tom Moss a home when Moss needed to establish residency in his new district.

Like Holt, other elected officials who have been on the receiving end of Hyneman favors have described him as just a really good friend. The fact that his company regularly appears before the council and commission to request approval for land-use changes has nothing to do with anything, they claim.

That's just plain silly. Any elected official who believes Hyneman isn't looking for favorable treatment in return for his many acts of kindness is hopelessly naive. Those who clearly understand Hyneman's game and choose to play it anyway are corrupt.

Our community doesn't need elected officials who fit into either of those categories.

In the wake of the Tennessee Waltz undercover investigation, there has been a lot of attention on tightening the state's ethics laws.

It's clear that more work needs to be done at the local level as well. The council's ethics policy is advisory only, which means it's basically worthless.

However, council members might not know where to turn for objective legal advice on making improvements: After all, their attorney Allan Wade is also representing Hyneman in a divorce case.

Another disappointing aspect of the latest revelations about Hyneman is that the elected officials involved seem to be beyond shame.

Hooks, who was indicted in August on bribery and extortion charges, told a reporter that press coverage will only help him in his upcoming trial.

"The more y'all write, the better it gets, baby," he taunted a reporter trying to interview him about the loan he received from Hyneman business partner Henry Weaver. "And I'm going to need public opinion. ... Y'all ain't learned that yet."

Forget integrity for just a second. Don't these elected officials have any pride? Why would they even be willing to let someone think that they could be bought off with free air travel or other perks?

Sure, being an elected official probably gets lonely at times.

But those who need a friend should get a dog.

The messes would be easier to clean up.

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Sunday, November 06, 2005

Hyneman a 'friend' indeed to officials

All say gifts, favors have no bearing on development votes

Commercial Appeal
By Marc Perrusquia and Michael Erskine
Link to original

He bought an airline ticket for County Commissioner Michael Hooks and helped City Council Chairman Edmund Ford lease a new $50,000 Cadillac.

When council member Barbara Swearengen Holt wanted to see a preseason Grizzlies game this fall, he helped her sit for free in a luxury skybox.

Multimillionaire developer Rusty Hyneman has provided these and other perks to local politicians while on a remarkable run winning approval for his often controversial land developments.

An investigation by The Commercial Appeal found:

Last year, Hyneman co-signed to lease a Cadillac sport utility vehicle worth more than $50,000 for Ford, who had bad credit and couldn't qualify for the car. Ford says he makes the monthly payments himself.

Hyneman paid $1,200 in April to get Hooks a plane ticket to New York, where the commissioner scouted out college opportunities for his teenage son.

Hyneman's business partner provided Hooks an interest-free $16,000 loan in 1999.
The favors, turned up in the newspaper's six-week investigation, only add to a lengthy list already public.

When he was county mayor, Jim Rout accepted a free trip on Hyneman's private jet. City Councilman Rickey Peete turned to Hyneman for help in buying a new house. Home builder-turned-commissioner Tom Moss rented a home from Hyneman when he needed to establish residency in a new district.

In addition, Hyneman, his family members and business associates have raised tens of thousands of dollars for council members and commissioners in campaign contributions since the 1990s.

Almost invariably, when politicians were asked about Hyneman, they described him as a friend, saying any favors he may have performed had no impact on their official actions.

"You don't think he's just a nice guy?" said Holt, 66, who says she is so close to the 41-year-old developer she calls him "my son."

In a council meeting in September, Holt, Ford and Peete fawned over Hyneman's fifth-grade daughter, who had won a championship riding one of her father's horses, presenting her with cuff links, a blouse, a medallion -- and the symbolic key to the city.

"It's outrageous (what) he can do," said attorney Dan Norwood, an advocate for ethics reform who also once led an unsuccessful fight to block a controversial Hyneman building project in Cordova.

"The local ethics law has absolutely no teeth in it."

Despite a statewide push for ethics reform following corruption indictments against at least 10 current and former public officials, the Memphis City Council still has few hard rules on accepting gifts, maintaining a code of ethics that is not mandatory but simply advisory.

"The next ethics battle needs to be right here," Norwood said.

Hyneman, who served a term in federal prison after a drug conviction in 1988, did not respond to repeated requests for an interview.

Ford's Cadillac

When Edmund Ford drives to City Hall to chair the council's biweekly meetings, he shows up in a sporty 2004 Cadillac SRX.

Ford got the black sport utility vehicle -- worth more than $50,000 and loaded with custom features -- last year from Bud Davis Cadillac, signing a $918 monthly lease.

Ford, 50, a funeral director by trade, filed for Chapter 13 bankruptcy in 1999. His credit was bad, and, he admits, he couldn't qualify by himself.

Records show Hyneman co-signed on the four-year lease.

The car is registered to the E.H. Ford Mortuary, but the title application was signed by Hyneman. Ford said he gets no help from Hyneman making the monthly lease payments.

"I don't need nobody to pay nothing for me. No. No, no, no, no. No sir," Ford said. "He's a friend of mine. ... I mean, he's just co-signing. I mean, what was the problem?"

Asked if Hyneman's co-signing equated to a gift with economic value, Ford said, "Well, I guess it would. ...

"You get people to co-sign with you on a lot of different things. If I didn't pay the note, they'd end up taking the vehicle, or whoever co-signed would be responsible, I guess. But other than that, no."

Former County Commissioner Joe Cooper, the car salesman who handled the Ford deal and who remains a close associate of Hyneman's, said he doubts the developer is paying for the car.

"I'm sure he isn't," Cooper said, but citing customer confidentiality, seemed to reconsider.

"Once the car leaves here, I don't know who pays for them."

Council minutes show that in the months after Ford's March 2004 acquisition of the Cadillac, he voted for two major developments involving Hyneman.

That May, the council unanimously approved Saint Andrew's Place, a 105-lot residential planned development near Houston Levee and Macon roads pitched by Hyneman's Rusco development firm.

In February, the council unanimously approved Fountain Brook, a 335-home development on 106 acres in Cordova. Office of Planning and Development records list Rusco Partnership as the applicant and equitable owner.

Ford said there was no connection between the car and any of his votes: "Nobody influences my vote. I'm going to vote what I think is right. You know, that's on anybody."

NYC bound

Last spring, when Hooks chaired the County Commission, the other major governing board that approves local developments in Memphis and Shelby County, Hyneman bought him an airline ticket.

Hyneman charged the ticket on his American Express card, records show.

Hyneman's account statement shows a $1,249 charge on April 22 to AirTran Airways for a round-trip ticket to New York.

The entry says simply, "Date of Departure: 4/23. Passenger Name: Hooks/Michael."

Asked about the charge, the commissioner's son, school board member Michael Hooks Jr., made it clear the charge wasn't made for him.

"Let me emphatically say that I did not go on a trip to New York," he told a reporter.

But his father did.

The departure date, April 23, was a Saturday, and records show Hooks was absent for the commission's meeting that Monday, April 25.

Tom Moss, who had to chair the meeting in Hooks's absence, recalled that Hooks was on a college trip with his youngest son, which included a visit to New York University and other northeastern schools.

"He had several scholarship offers, and I think it was posed as it had to do something with that," Moss said.

"... They started in New York and they might even have gone up to Connecticut from there. That is my best guess."

Hooks did not respond last week to requests for comment on the tickets, but told a reporter earlier this fall that a $16,000 loan he took in 1999 from Hyneman's business partner had no impact on his voting.

"It's my personal business. It's got nothing to do with government," he said in September.

Records show Hooks has voted for several Hyneman projects through the years, including a 2001 addition to the sprawling Cordova Ridge planned development.

More perks

Holt said she sat with Hyneman last month in a skybox at a Grizzlies preseason basketball game. Hyneman often sits there, yet Holt said she can't recall who owns the skybox or which game it involved.

"I enjoyed it," she said.

Holt told The Commercial Appeal last year that Hyneman had given her Grizzlies club seat tickets worth $140 a pop more than once during the 2003-04 season, but says she now has season tickets that she paid for herself.

"He is a friend," said Holt, who has often supported Hyneman projects, but said the tickets have no impact on her votes. "My integrity means more to me than a Grizzlies ticket."

Councilman Peete, who met Hyneman in prison while serving a term for extortion and who got help from the developer in 1997 in buying a $110,000 home, said he, too, considers Hyneman a friend.

"You can be friends with an individual and at the same time maintain an objective perspective, if in fact there's something they've got that has to come before the body," Peete said.

"And that's the way I try to approach everything."

-- Marc Perrusquia: 529-2545

- Michael Erskine: 529-5857

Reporter Ruma Banerji Kumar contributed to this story.

Copyright 2005, commercialappeal.com - Memphis, TN. All Rights Reserved.


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Friday, November 04, 2005

House bill counters eminent domain ruling

Associated Press
Link to original

WASHINGTON (AP) -- Contending that the Supreme Court has undermined a pillar of American society -- the sanctity of the home -- the House overwhelmingly approved a bill Thursday to block the court-approved seizure of private property for use by developers.

The bill, passed 376-38, would withhold federal money from state and local governments that use powers of eminent domain to force businesses and homeowners to give up their property for commercial uses.

The Supreme Court, in a 5-4 ruling in June, recognized the power of local governments to seize property needed for private development projects that generate tax revenue. The decision drew criticism from private property, civil rights, farm and religious groups that said it was an abuse of the Fifth Amendment's "takings clause." That language provides for the taking of private property, with fair compensation, for public use.

The court's June decision, said House Judiciary Committee Chairman James Sensenbrenner, R-Wisconsin, changed established constitutional principles by holding that "any property may now be taken for the benefit of another private party."

The ruling in Kelo v. City of New London allowed the Connecticut city to exercise state eminent domain law to require several homeowners to cede their property for commercial use.

With this "infamous" decision, said Rep. Phil Gingrey, R-Georgia, "homes and small businesses across the country have been placed in grave jeopardy and threatened by the government wrecking ball."

The bill, said Chip Mellor, president of the Institute for Justice, which represented the Kelo homeowners before the Supreme Court, "highlights the fact that this nation's eminent domain and urban renewal laws need serious and substantial changes."

But opponents argued that the federal government should not be interceding in what should be a local issue. "We should not change federal law every time members of Congress disagree with the judgment of a locality when it uses eminent domain for the purpose of economic development," said Rep. Bobby Scott, D-Virginia.

The legislation is the latest, and most far-reaching, of several congressional responses to the court ruling. The House previously passed a measure to bar federal transportation money from going for improvements on land seized for private development. The Senate approved an amendment to a transportation spending bill applying similar restrictions. The bill now moves to the Senate, where Sen. John Cornyn, R-Texas, has introduced companion legislation.

About half the states are also considering changes in their laws to prevent takings for private use.

The Bush administration, backing the House bill, said in a statement that "private property rights are the bedrock of the nation's economy and enjoy constitutionally protected status. They should also receive an appropriate level of protection by the federal government."

The House bill would cut off for two years all federal economic development funds to states and localities that use economic development as a rationale for property seizures. It also would bar the federal government from using eminent domain powers for economic development.

"By subjecting all projects to penalties, we are removing a loophole that localities can exploit by playing a 'shell game' with projects," said Rep. Henry Bonilla, R-Texas, a chief sponsor.

The House, by a voice vote, approved Gingrey's proposal to bar states or localities in pursuit of more tax money from exercising eminent domain over nonprofit or tax-exempt religious organizations. Churches, he said, "should not have to fear because God does not pay enough in taxes."

Eminent domain, the right of government to take property for public use, is typically used for projects that benefit an entire community, such as highways, airports or schools.

Justice John Paul Stevens, who wrote the majority opinion in Kelo, said in an August speech that while he had concerns about the results, the ruling was legally correct because the high court has "always allowed local policy-makers wide latitude in determining how best to achieve legitimate public goals."

Several lawmakers who opposed the House bill said eminent domain has long been used by local governments for economic development projects such as the Inner Harbor in Baltimore and the cleaning up of Times Square in New York. The District of Columbia is expected to use eminent domain to secure land for a new baseball stadium for the Washington Nationals.

Copyright 2005 The Associated Press. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.

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Monday, November 29, 2004

Riverfront Projects Spark More Downtown Interest

Memphis Daily News [link]
by Andy Meek

Developer Kevin Hynemans recent purchase of 8.7 acres of Mud Island property is further proof, if any was needed, that the 1-square-mile strip of land is still a strong magnet for new residential development. And besides Hynemans new Mud Island project, other nearby developments are using their proximity to the Mississippi River to spark continued interest in the area.

More new homes. Hyneman bought the property from the Riverfront Development Corp., which oversees the use of public space on Mud Island, and his plans call for 106 single-family, detached homes priced between $160,000 and $250,000. He plans to break ground on the homes after Christmas, with the first homes available for sale around summer 2005.

Hyneman said there is already a waiting list for the homes, echoing a previous project he developed on Mud Island that saw 80 homes sold in one day. A reservation list had been drawn up, and buyers camped out on the island to be able to pick the lots they wanted, he said.

Fueling more growth. Hyneman, who has developed several projects on Mud Island, believes strong demand is both a result of and further fuel for the general resurgence of Downtown.

Downtowns on fire, he said. I think its supply and demand for Mud Island people see theres a sense of urgency because theres no other property on the island to buy.

Benny Lendermon, president of the RDC, said the group has plans for a walking trail along Wolf River Harbor, a project related to Hynemans recent purchase.

The group also is moving forward with plans for the Beale Street Landing project, which Lendermon said will be a public gathering place and the signature development at the foot of Beale Street. He estimates ground will be broken in the spring and initial construction will begin soon after along the rivers edge.

Well be very, very disappointed if it doesnt, he said.

The $27 million project at the foot of Beale Street will likely include a plaza, a terminal building, a small restaurant and a series of small parks perched at the rivers edge. The RDC also is continuing with some minor park improvements.

Healthy residential market. On Mud Island, where several residential communities in addition to Hynemans are under way, healthy residential growth is visible.

Several residential communities have taken root north of Harbor Town, Mud Islands first residential community. And according to a recent Downtown market study commissioned by the Center City Commission, the current population of Mud Island part of the high growth area in Downtowns Central Business Improvement District is estimated at 4,262.

Hynemans latest project is part of an overall plan for 186 new homes on the island. Hyneman expects to sell most of them between now and the end of 2005.

Weve built over 500 houses down there, and this is just another phase of what weve been building down there for the past five or six years, he said. Weve got another 80 lots that are currently being developed, and those will be released sometime in the next couple of months.

Property history. The property was originally part of an effort by the RDC to acquire public land along the river. Lendermon said the land Hyneman bought was property the city had acquired from an asphalt plant after it moved. The city transferred the land to the RDC this year to help the group acquire public land and better access to the river.

Originally, we were going to use it as part of an equity transaction in that development to the south of Mud Island, and we were going to actually utilize this piece of property to help facilitate the transfer of other properties to allow parkland to be acquired along the waters edge, Lendermon said. So we were retaining this piece of property for the city, and then at some point that wasnt going forward. We had it, we had no use for it, but we still wanted to use it for something to our benefit. Kevin owned all the properties surrounding this piece of property, and it was sort of landlocked. He also owned a whole lot of the water frontage along the harbor we were interested in acquiring.

Advantages. Hyneman, who bought the 8.7 acres from the RDC for $841,000, also agreed to transfer 18 acres of waterfront property he owned along the Wolf River Harbor to the RDC, which will use the land for part of a walking trail. Lendermon said the city supported the sale of the 8.7 acres for several reasons.

The tax benefits from those single-family homes are somewhat significant, and it allows the whole chunk of property to develop and put property on the tax rolls in a way that both us and the city felt was appropriate, he said. So it appeared to be a win-win for everybody.

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Monday, November 15, 2004

Mud Island sale tracks a path to the future

Commercial Appeal
by Tom Charlier

In selling off one of the last large pieces of land left on the north end of Mud Island, the Riverfront Development Corp. cut a deal to secure more public access to the waterfront.

RDC, the nonprofit overseeing redevelopment of the Memphis riverfront, received six parcels totaling 18 acres along the Wolf River Harbor in addition to the $840,000-plus price that developer Kevin Hyneman paid for 8.7 adjacent acres.

RDC president Benny Lendermon said the donated acreage will accommodate part of a walking trail planned along the harbor.

"We hope to have public access all along the harbor, especially as the harbor gets better and better," Lendermon said.

Hyneman, a partner with Jeffrey Bronze in several projects on the island, will use the purchased land as part of a 15-acre development featuring 106 single-family homes. The Riverpoint planned development, which Hyneman describes as a continuation of his previous projects, was approved by the Land Use Control Board on Thursday.

The 8.7 acres in the transaction are less than a half-mile south of the causeway connecting the northern end of Mud Island to Downtown.

The land had been owned by an asphalt company, with the city obtaining it when the firm moved. The city transferred the property to the RDC this year. The sales price was based on the appraised value of the land, Lendermon said.

Hyneman agreed that RDC and the public benefited from the deal. "We think they came out on top, but that's OK," he said.

RDC officials were glad to see the land used for homes instead of apartments. "There's nothing wrong with apartments," Lendermon said. "But there's a multitude of apartments down at that northern end."

Hyneman, who has developed some 500 homes on Mud Island, said the residences in the new project probably will be priced from $160,000 to $250,000.

"The market is very strong down on the island," he said.
In addition to Riverpoint, he and Bronze are working on plans for a $75 million mixed-used development on the island just south of the Auction Street bridge and encompassing the site of a calamitous mudslide two years ago.

The project will feature condominium units and homes, but the 4 acres affected by the mudslide will be set aside for some amenity - perhaps a marina or park, Hyneman said.

Copyright (c) 2004 The Commercial Appeal, Memphis, TN

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Thursday, April 01, 2004

New, revised plans awaiting Mud Island property

Memphis Daily News [link]
by Andrew Bell

On an August morning a little less than two years ago, a surprise mudslide sidetracked a developers plan that would have added single-family homes and multifamily units to the south end of Mud Island.

Now, developer Kevin Hyneman is preparing to present new plans for the 21-acre tract to the Riverfront Development Corp. He said the plans will be finalized within 90 days.

Land stable. Hyneman said a series of geotechnical studies conducted on the property following the mudslide are nearing completion. So far, the studies indicate that at least part of the land can sustain construction.

"The stability is fine," Hyneman said. Obviously, the mudslide area will never be able to be built on, but there was just no sense making any plans until we determined that we had a site we could actually build on."

Steeped in controversy. From the beginning, any talk of residential development on the property south of the Auction Avenue bridge has stirred up debate, starting with the clearing of trees.

Hyneman acknowledged the controversial nature of the property.

The site is within the scope of a 50-year Riverfront Master Plan created by New York-based Cooper, Robertson & Partners for the RDC, a nonprofit, public-private partnership formed to oversee improvements to the citys stretch of Downtown riverfront.

According to a special warranty deed filed in the Shelby County Register's Office, Kevin Hyneman Cos. bought land from Echelon Residential LLC for $2.5 million in 2001. Plans subsequently surfaced for Hyneman to sell the land to a joint venture that included Henry Turley, Jack Belz and the RDC who, in turn, announced plans to build an $18 million, 349-unit development on the property on a scale resembling the Mud Island homes north of Auction in Harbor Town.

New negotiations. The mudslide halted those arrangements, forcing Hyneman to consider new options.

"We have not talked in about three months," said RDC president Benny Lendermon of the organizations communication with Hyneman. There are still issues to be worked out.

Laura Morgan, Center City Commission director of planning and development, said the CCC also has not entertained discussion about the property's future in recent months.

Lendermon said the RDC's view for the south end of the island would target the center portion for development, reserving the propertys Mississippi River and Wolf River shorelines for park space.

"(Hyneman's) property is on the harbor side of the road," Lendermon said. The public property is on the western side of the road. Our idea was to swap properties and end up with park space on either side next to the water, and shift the development to the center and make it bigger and more significant.

"We feel like that's a better fit with what were hoping to accomplish."

Working out a compromise. Lendermon said the RDC and Hyneman were in serious discussions before the mudslide and for a period of time immediately following it.

He said although Hyneman can freely pursue any development granted approval by the city-county Office of Planning and Development, any project deemed risky by the RDC could prevent the organization from recommending the project for a potential Center City Revenue Finance Corp. tax freeze.

"The financial parts of it didnt make sense to us how he was trying to pursue it," Lendermon said. "We were trying to figure out some way to be the vehicle enabling the development to be built on the center of the island with green space on either side. We still think thats best way.

"We are out to ensure that the financial deal makes sense for the public entity to be involved, and at its last point, we didn't think it did."

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Friday, November 14, 2003

Street Talk

Memphis Business Journal [link]
by Scott Shepard

Kevin Hyneman has yet to move forward with plans to develop the south side of Mud Island, where a mud slide occurred in August 2002, but he has been given the go ahead to build 159 single-family detached homes on 19.5 acres near the north end of the island.

Directly west of 15 acres he already owns with Wayne Christian and just south of the Jefferson River Estates apartment complex, the property will be accessed through an improved Henning Road, renamed Island Place East, which connects to Levee Road. Levee Road runs between Island Drive and North Second.

JPI Development tried to get the land rezoned for multi-family housing last March. The request was rejected primarily because of density. The Office of Planning and Development concluded a multi-family project on the property would push the housing ratio on Mud Island to 66% multi-family.

OPD has approved Hyneman's proposal, which still must be approved by the Memphis City Council.

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Friday, June 27, 2003

Hyneman blames contractors for mudslide in lawsuit

Memphis Business Journal [link]
by Kate Miller Morton

Nearly a year after a massive landslide sent tons of dirt careening into the Wolf River Harbor just south of the Auction Street bridge, a legal battle has begun to assign blame.

Kevin Hyneman Cos., Inc., filed a lawsuit in Circuit Court last week against multiple parties associated with the site work designed to lift 13 acres of land above the flood plain and stabilize it for the development of single and multi-family homes. Defendants in the case include Ellington-Foster, Inc.; Sailors Engineering Associates, Inc.; and L&T Construction, Inc.

Hyneman is seeking to recover $600,000 the company spent to reopen the harbor, restore the shoreline and stabilize the harbor's banks immediately following the Aug. 12 catastrophe. The developer is also seeking unspecified damages addressing increased carrying costs on the land; reduction in the land's value; and damages and expenses associated with claims by upstream businesses affected by the temporary closure of the harbor.

Kevin Hyneman and Jeff Bronze, co-owners of the property, did not return phone calls. Ellington-Foster and L&T Construction declined comment. Sailors did not return phone calls.

Shuttleworth Williams PLLC partner Michael Derrick, one of Hyneman's four attorneys, says the developer tried to resolve the issue out of court.

"It takes two to dance and from day one we've been trying to involve the contractor and engineer to step up to the plate with their insurance carriers to take care of this mess and they've drug their feet," Derrick says. "Unfortunately we've had to sue them to recover what this has cost Kevin."

North Carolina-based Ellington-Foster designed and installed the wicking system and the slope stability and settlement monitoring instruments used to measure the performance of the drainage system. Sailors Engineering was contracted by Ellington-Foster to perform geotechnical drilling, conduct density tests, install monitoring instruments and observe placement of dirt fill. Hernando-based L&T Construction was contracted by Kevin Hyneman Cos. to excavate dirt from the construction site of the FedExForum and transport it to Hyneman's Mud Island site.

Charging breach of contract and negligence, the lawsuit claims Ellington-Foster failed to properly design and/or install the wick drain system; failed to properly perform testing to ensure slope stability; and failed to monitor the amount and location of the dirt fill stockpile on Mud Island.

Negligence claims against Sailors include failing to properly conduct an adequate number of density tests on the site to ensure slope stability; failure to take accurate readings of the performance measurement instruments; failure to take instrument readings with proper frequency; and the failure to monitor the data accumulated from those readings.

Breach of contract and negligence claims against L&T assert a failure to properly place and compact dirt fill per the engineer's instructions and failing to monitor the placement of that dirt on the site.

Also at issue is insurance. Hyneman alleges that Ellington-Foster and L&T breached their contracts by failing to ensure that Hyneman was listed as an additional insured under its general and professional liability insurance policies. He also claims Ellington-Foster failed to ensure that subcontractor Sailors Engineering listed Hyneman as an additional insured under its general and professional liability policies.

Ellington-Foster's insurer, Victor O. Schinnerer and Co., Inc., the insurer's parent company, CNA Financial Corp., and its agent H.B. Cantrell Co. are also named as defendants in the lawsuit.

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Friday, May 09, 2003

Hyneman moves forward with Mud Island development plans

Memphis Business Journal [link]
by Kate Miller

Kevin Hyneman and partner Jeffry Bronze are moving forward with plans to create a high-density development on the southern end of Mud Island where a massive landslide occurred last August.

Hyneman and Bronze, who now owns 50% of what was previously Hyneman's 21 acres, have planned a $50 million, 19-acre development that will include 234 apartments, 220 condos, four townhomes and 10 single-family lots.

The development will occur in two phases. Phase I, on the southern end of the property, will include 216 rental apartments and 10 residential lots. Hyneman is applying to the Center City Revenue Finance Corp. for a 20-year tax freeze on the eight-acre apartment development, projected to cost $18.34 million.

Phase II will consist of three acres directly involved and within 100 feet of the embankment failure. Hyneman says development of the 18 rental units, four town homes and 220 condos involved in this phase won't begin until all litigation concerning the landslide is resolved, a process he says could take anywhere from three to five years.

Hyneman and his insurance company Indiana Insurance are filing suit against the earth moving contractor L&T Construction and the wicking system material supplier Nilex.

Hynemen says his geotechnical engineers have assured him the failed area can be stabilized and developed.

Prior to the landslide, Hyneman had negotiated a deal to sell his 21 acres to a joint-venture consisting of Henry Turley, Jack Belz and the Riverfront Development Corp. The group announced plans to build an $18 million, 349-unit development on the property that would resemble Harbor Town. 199 of the units would have been for sale, ranging from single-family lots with river views to townhomes and condos. The remaining 150 would have been rental apartments.

Hyneman says all parties involved realized there was no deal almost immediately after the failure occurred.

"30 days after the failure we started working on plan B," he says. "Things happen for a reason and we feel like the failure really created an opportunity for us."

Hyneman says he has always thought a high-density development was the highest and best use of the property, which is why he was not going to be involved in the RDC-Belz-Turley plan.

"We felt like this was more of a multifamily site," Hyneman says. "It's the last site on the island that has multi-family zoning."

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Friday, November 08, 2002

Future of Hyneman's Mud Island land remains murky

Memphis Business Journal [link]
by Kate Miller

Three months after an early morning landslide sent tons of dirt into the Wolf River just south of the Auction Street Bridge, the harbor is clear but the future of Kevin Hyneman's 21 acres on Mud Island remains murky.

"As we speak we're still waiting on a report from our geotechnical engineer, which is going to give us the reason for the cause of the failure," Hyneman says. "Once we receive that, then we'll be able to determine exactly what we can do with the property, then seek proposals from different contractors who specialize in this type of problem and they'll do a design-build for going in and actually fixing the problem."

Larry Cooley, principal in the Ridgeland, Miss.-based geotechnical engineering firm Burns Cooley Dennis, Inc., says he is still waiting on some data but a report should be released within a couple of weeks.

"We have determined the cause," Cooley says. "There is a way to remedy that."

He would not give details on either.

Hyneman says the prospect of future litigation is likely the cause of the delay, though no lawsuits have been filed to date.

Hyneman was within 30 days of closing on a sale of the land to a joint-venture development team consisting of Belz-Turley and the Riverfront Development Corp. when the landslide occurred. He had agreed to sell the land for $2.6 million plus interest and 11 city-owned acres on the north end of Mud Island, in an area where he has already built many single-family homes.

Henry Turley and RDC president Benny Lendermon say they are still interested in developing the land, but their future involvement is far from certain. The Harbor Town-like development previously planned might not be possible.

Lendermon says the mudslide actually affected only a very small amount of land in the planned development, possibly seven lots. But while it has a small impact on the total amount of land to be developed, the lost lots could make or break the deal.

"This project wasn't a gold mine to start with," Lendermon says. "It took a lot of time to put this together because the profits were very slim and you had to be very creative to make it work financially for everybody. So, saying that you take a piece out and take some lots out and take away some revenue -- it probably hasn't reduced the cost any -- it makes the situation that much harder to do."

Turley says the partners estimated each of the lots affected by the mudslide to be worth about $175,000 each, or $1.225 million for seven lots. But Turley says if the land where the mudslide occurred isn't developed, then the partners could charge more for the lots behind them since they would have the view of the harbor.

There would be no such way to make up for other costs.

One is the cost of carry, the interest, taxes and insurance payments that Hyneman is currently paying and would be transferred to the new owners. Hyneman has said he pays between $125,000 and $130,000 in interest a year and $20,000 to $25,000 in real estate taxes. The developers will have to carry this cost longer because of the delays.

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Friday, May 03, 2002

Clear cut, it's not

Plans uncertain for Mud Island tract

Memphis Business Journal [link]
by Kate Miller

Ongoing talks between Kevin Hyneman, Henry Turley, Jack Belz and the Riverfront Development Corp. regarding development on Mud Island have intensified after Hyneman began clearing trees from his 21-acre property south of the Auction Street bridge.

Hyneman, whose development plans caused an uproar last year from several Downtown organizations -- including the RDC -- says he no longer wants to develop the land and is in preliminary negotiations to sell it to a joint venture consisting of the three parties for a Harbor Town-like development.

"That's not something that we'd want to be a part of," Hyneman says. "Not that that won't be nice, but we've got a lot on our plate and that won't be a part of our five-year plan."

All parties emphasize that negotiations and plans are still at a preliminary stage, but Turley has an idea of what such a deal might look like.

Belz-Turley, a collaboration that has worked on numerous other Downtown projects -- most recently Uptown -- would form a joint venture with the RDC.

The RDC would contribute city-owned land such as the property it owns west of Island Drive and south of the Auction Bridge. Belz-Turley would guarantee the loan taken out by the joint venture and contribute to the work and planning of the development.

That loan would pay for the acquisition of the land as well as the costly infill.

The Belz-Turley portion of the venture would also contribute about an acre of land Turley owns on the southeast corner of Auction and Island Drive.

Turley says the development wouldn't be identical to Harbor Town but would be of the same quality. It would most likely be mixed-use with single family and multi-family residential development as well as some office space. A small inn or hotel has even been discussed.

The public-private development would also incorporate public access along the Mississippi and Wolf Rivers, including public trails and green spaces.

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Friday, November 09, 2001

Mud Island property purchase finalized; Developer buys Mud Island property

Memphis Daily News [link]
by Sue Pease

Local developer Kevin Hyneman finalized the purchase of 21 acres on Mud Island, bringing plans to build on the vacant land closer to reality and continuing to raise questions about the property, which lies in the heart of the Downtown riverfront.

According to a special warranty deed filed in the Shelby County Registers Office, Kevin Hyneman Cos. bought the land from Echelon Residential LLC for $2.5 million Oct. 26.

A related trust deed also was filed in the registers office, with a lien on the real estate for $2.6 million.

While Hyneman, an independent developer, now owns the land, the property sits among the Downtown riverfront area, between the Mississippi and Wolf rivers. It would fall within the boundaries of a publicly initiated master plan, which might affect the way the property is developed.

At this point, Hyneman said he is still uncertain of what he will build on the property.

Hopefully, well be doing something the city will be proud of, he said.

Before the land purchase was finalized, Hyneman said he had discussions with the Riverfront Development Corp. Both groups considered a joint venture, but a decision wasnt agreed upon.

We went to the RDC for a proposal for a joint venture, and I think there is still an opportunity there, but I had contractual obligations so I had to close (on the property).

Of the 21 acres, about 14 usable acres are suitable for development, he said. It begins on the south side of Auction Street near the intersection of Island Drive.

Hyneman said discussions between both parties were positive. Regardless of whether a joint venture is realized, it would be developed with RDC input.

He said he is discussing a plan for the area with Atlanta-based Post Properties, in case plans dont materialize with the RDC.

In February 2000, the RDC was formed, backed by Mayor Willie Herenton, and given the task of redeveloping 12 miles along the Downtown riverfront.

The RDC, a public-private partnership, is creating a master plan for the waterfront with the help of consultants.

The board hopes Hynemans project will fit in with their plans.

Benny Lendermon, RDC president, said although the board had many discussions with Hyneman, a specific proposal hadnt materialized, but plans on both sides werent at different ends of the spectrum.

We don't think our goals, in both cases, are that different, he said.

Lendermon said types of uses the RDC would like to see would be similar to what is on the north side of the Auction Street Bridge.

Urban residential development, similar to Harbor Town, which increases in density closer to the Hernando DeSoto Bridge, would be optimal in RDCs opinion, he said.

Mary Baker, Memphis and Shelby County Office of Planning and Development deputy director, said the area is currently zoned R-MM, multifamily, which allows 30 units per acre at a maximum height of 125 feet.

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Thursday, August 23, 2001

Down By the Riverside

The Riverfront Development Corporation prepares to sell its vision for Mud Island's future. Will Memphis buy it?

Memphis Flyer [Link to original]
by John Branston

If a journey of a thousand miles begins with a single step, then a process that could reshape downtown Memphis for the next 50 years begins next month when the Riverfront Development Corporation (RDC) starts selling its vision for a dramatically different riverfront.

Starting from public hearings and a mom-and-apple-pie vision statement of a "world-class riverfront" that "binds us together as a community," the RDC and its consultants have come up with a package of short-term (think 2002-2003) and long-term improvements (not soon, but probably well short of the RDC's ruffle-no-feathers 50-year horizon).

The final draft of the master plan will be approved within two months. But the rendering on these pages is generally state-of-the-art, although it shows buildings where there will not be buildings and omits a pedestrian bridge from the foot of Union Avenue to Mud Island. Prominent features of the plan include:
  • A massive land bridge connecting Mud Island to downtown and dividing the present slackwater harbor into a smaller harbor and a narrow 150-acre lake.
  • Extensive residential and commercial development on Mud Island River Park.
  • Preserving part of the park (mainly the southern end and river's edge) as public park.
  • Keeping the model of the Mississippi River in the park but getting rid of the amphitheater and possibly the monorail, while expanding the museum but putting it in a new building.
  • Saving prime space on the land bridge for a corporate headquarters in case some company wants to relocate from the suburbs or another city in the future.
  • A circular outdoor plaza and cruise-boat dock at the foot of Beale Street and the northern end of Tom Lee Park.
  • Relocation of all marinas and small-boat tie-ups to the southern end of the slackwater harbor next to the cobblestones, which would be shored up with a seawall.
  • Development of the public promenade known as the Overton Blocks which includes the fire station, post office, Cossitt Library, and parking garages.
The driving principle behind all of this: Make it pay. "There has to be something to pay for the infrastructure," says Benny Lendermon, president of the RDC. "We're trying to create three times as much private investment as public dollars. That gives enough payback."

Lendermon and Kristi Jernigan, vice chairman of the RDC, will start selling the plan in earnest next month. Among other things, this will test how well the tortoise-and-hare RDC partnership works, now that it has usurped the powers of the Memphis Park Commission in all riverfront matters. Lendermon comes from the public sector, where he served in city government for some two decades, viewing no less than 13 riverfront plans that came and went, by his count. He knows better than anyone that major parts of the plan need political and corporate support and funding, plus the blessing of regulators, preservationists, and the courts. Kristi and Dean Jernigan were the driving forces behind AutoZone Park, which went from concept to completion in three years and was praised in a feature article last week in The New York Times.

The picture that ran with the article was a reminder that downtown Memphis still has a ways to go. It showed AutoZone Park with the 30-story Sterick Building in the background. Few of the Times readers probably realized that the Sterick Building has been empty for years.

One reason the RDC plan will have more impact than its predecessors is that it builds on some work already funded and in progress. The low-hanging fruit includes the sidewalk next to Riverside Drive between Tom Lee Park and Jefferson Davis Park which has been under construction all summer. Eventually it will extend all the way to Mud Island, running along the west side of The Pyramid. Improvements are also underway to stabilize the cobblestones. The RDC also took away the admission charge to the grounds of Mud Island River Park this summer and plans to use Mud Island for more events, including this year's Blues Ball, previously held at The Peabody, the Rock 'n' Soul Museum, and Central Station.

Other changes that are likely within a year or two include placing medians in Riverside Drive and lowering the speed limit, scheduling more activities at Tom Lee Park, and improving stairway connections from the bluffs to Tom Lee Park as well as the docking facility and plaza at the foot of Beale Street where it meets the river.
The more ambitious parts of the plan are the massive land bridge, the lake, the Overton Blocks, and the Mud Island makeover. Politics, a lack of public funding or private investment, regulatory or engineering problems, or failure to reach agreement with the Overton heirs could stall any or all of these indefinitely. But the opening of AutoZone Park and Peabody Place and the relocation of the NBA Grizzlies have created a feeling that all things are possible, at least in the minds of RDC officials.

"Now there is an implementer," says Lendermon.

The RDC, for example, is actively contacting and negotiating with the Overton heirs through the Baker Donelson Bearman and Caldwell law firm. Lendermon says that, contrary to newspaper reports, the RDC has "a productive working relationship" with brothers Kevin and Rusty Hyneman, who own a key piece of land on Mud Island between the two bridges. There are relatively few industries on the harbor compared to other places that RDC members visited, including Cincinnati, Louisville, Pittsburgh, and New York -- all cities that managed to start or complete waterfront redevelopments.

"The real issue now is defining costs and testing this with developers," says Jernigan.

For now the RDC is only looking for their expertise, not commitments. But Lendermon and Jernigan think there could be substantial progress on the land bridge and Overton Blocks in five to seven years. Those two projects alone would create prime sites for a major corporate headquarters -- something downtown hasn't landed since AutoZone moved to Front Street 10 years ago.

Here's a detailed look at specific parts of the riverfront plan, with comments by Lendermon and Jernigan.

Tom Lee Park

Memphis In May stays. So does the Beale Street Music Fest. "We'd like to think we could improve the layout and vegetation to accommodate more non-Memphis In May uses," says Lendermon. The park will get more seating, places for vendors, and connections to the stairways on the bluff.

"Next year we would like to look at programming Tom Lee Park more," says Jernigan. "Kind of like what Battery Park in New York does with their Hudson River summer festival and activities from bike rental to in-line skating to morning tai-chi workouts."

Vance and Confederate Parks need improvements too, and one possibility, Jernigan says, is "a total upgrade of all the greenspaces that are here now that are going to stay long-term."

Riverside Drive

Think slower. The goal is to accommodate the same volume of traffic at a lower speed. The RDC will soon take bids to build a 10-foot planted median as well as lighted pedestrian crossings at Beale and the stairways on the bluff and a change in pavement to encourage slower speeds at the juncture of Interstate 55 and Riverside Drive. The RDC is also working with the city of Memphis to accelerate the work schedule on an interchange at Crump Boulevard and I-55 and a connection between Riverside Drive and Second and Third Streets near the south end of Riverside Drive so that those streets can take more traffic. The width of the roadway will be widened by covering up a drainage ditch on one side.

Beale Street Landing

This circular pavilion will serve as a docking facility for large steamboats, a dropoff place for shuttle buses, and a concession stand. It will be the terminus of Beale Street, Tom Lee Park, and the Cobblestone Walkway and will have some sort of tall monument or tower to draw attention to itself. Planners think the tip of Mud Island has the potential to be something on the order of the coming together of great rivers in Pittsburgh. Since the harbor is not exactly a river at all, much less a great one, this seems a stretch, but this is a key location in the overall plan. A near-term improvement.

The Cobblestones

In a word, difficult. Between dealing with historic preservation interests, Memphis In May, lawsuits from injured boat passengers, and regular tour-boat traffic, the cobblestones have proven "more of a challenge than we anticipated," Lendermon says. Some of the "less historic" cobblestones have been removed to accommodate a retaining wall to hold the rest of them in place. Low spots will be filled in, but people will still be allowed to walk on the cobblestones, although there will also be walkways above them for those who prefer not to risk a tumble.

Long-awaited Ron Terry Plaza at the foot of Union is still alive, but the RDC is trying to figure out how to incorporate it into the new walkway under construction. A planned pedestrian bridge from the foot of Union to Mud Island further complicates matters. "The worst thing would be to build Ron Terry Plaza and five years from now go in there and tear part of it out," says Lendermon. Once seen as a near-term improvement, the cobblestones could be a work in progress for years if the land bridge happens.

Mud Island Park

Twenty years ago its buildings were so "now." Which could be why they now look so "then."
Two decades of public apathy are enough in the minds of the RDC. Major changes in the long term, minor ones in the near term. Admission to the grounds is free this summer, and Lendermon says attendance was up 50 percent in July. The amphitheater is rarely booked, despite a sold-out rap concert last weekend and a beer festival this weekend. Pat Tigrett's Blues Ball is moving to Mud Island, the scene of her bridge-lighting party in 1987. Over the next two years, the RDC would like to move more events that attract a few hundred to a few thousand people to Mud Island and leave mega-events at Tom Lee Park.

The museum and amphitheater stay open for the next year or two, but long term the amphitheater most likely goes, say Lendermon and Jernigan. The river model stays, possibly as the centerpiece of a future hotel, but the Gulf of Mexico part shrinks. "It definitely will not be a swimming pool," says Lendermon. A new seawall braces the southern tip and harbor, letting people get down to a proposed new walkway closer to the water. Coupled with the land bridge, Mud Island River Park between the amphitheater and the museum becomes a mixed-use development, long term. The south end and the western edge along the river remain a public park.

The Overton Blocks

This enticing piece of the puzzle is hamstrung by a historic covenant prohibiting private development. The RDC envisions some private development facing the river, a la the AutoZone headquarters, mixed with a lot of public space and parks. The post office stays, maybe as a new home for the Wonders series. Buildings would be subject to height restrictions. A lawsuit is likely, even welcomed.

"A court has to legally decree something and put its stamp of approval on it," says Lendermon. "There is no way we can enter into a private-party contract with the Overton heirs without the judicial system being involved."
Another approach would be to argue that the RDC is by definition a public purpose and use condemnation proceedings.

"We're going to have to work with the city and their political will, so it's going to have to be a joint effort," says Jernigan.

Despite all the obstacles, the RDC is optimistic because the potential is so great.

"Even the Overton heirs are for it," says Lendermon. "The fact that there is an entity focused on the riverfront I think gives the heirs some confidence that something is going to happen and that it is going to be in accordance with a plan that is going to be executed."

The Land Bridge

Lendermon estimates it would take two years to get the permits and design it once there is agreement to go forward with this riverfront centerpiece. Construction would take two more years, following the method used to expand Tom Lee Park.

"Five years would be quick," he says. "We think it is more like 10, realistically, before you have that site ready. We will be talking a lot to the development community about this one."
There are concerns that the project, in addition to being hugely expensive, could be so big that nothing happens and momentum is lost, as happened at Battery Park in New York. Or it could simply shift businesses away from other parts of downtown, with no net gain.
Ideally, the land bridge would fill up with housing, commercial sites, a hotel, and office buildings, with a public plaza rounding off the harbor on the south side. Development costs would be offset by lot sales and leases.

The Lake

A 150-acre lake is created north of the land bridge. It becomes a prime site for residential development instead of the industrial users now on its eastern bank. The RDC estimates it will take two or three years to move the industries, and three to five more to finish the lake. The existing marina would move to the cobblestones.
"The lake would be a great neighborhood generator for Uptown," says Jernigan.

(Uptown is the residential development northwest of St. Jude Children's Research Hospital.)

One possibility is connecting the lake with the harbor via a San Antonio-style river walk cutting through the land bridge.

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