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Kannapolis wrestles with downtown’s demise

By Emily Ford
eford@salisburypost.com
KANNAPOLIS ó Faced with the demise of downtown, Kannapolis leaders are wrestling with how to bring retail, shoppers and jobs back to the former Cannon Village.
During a recent long-range planning retreat, city staffers called the downtown “emptying” and “dead.” Vacant storefronts hurt development at the nearby N.C. Research Campus, they said.
Potential tenants at the Research Campus wonder why downtown is “so dead,” said business and community affairs director Irene Sacks, who urged the Kannapolis City Council to consider several ways to spark downtown development.
For prospective businesses, “it raises the question of whether to invest” in the Research Campus, Sacks said.
Her proposals included a facade improvement grant program and a municipal service district, where downtown tenants and David Murdock, who owns nearly all of downtown, would pay a tax to generate revenue for marketing and promotion.
So much has changed so quickly in this mill town-turned-biotech hub that one council member asked for a definition.
“Where is downtown?” said Ken Geathers, who served on the inaugural council 25 years ago when Kannapolis became a city. “We have to define it.”
City Manager Mike Legg said downtown includes the brick shopping district as well as the Research Campus, a new $1.5 billion science complex dedicated to health, nutrition and agriculture that has struggled during the recession.
Murdock owns the Research Campus too.
People need to see real progress downtown, Sacks said.
“We can’t keep telling them it’s going to be here in five years,” she said.
Downtown has lost so many businesses that it’s hard to recruit new ones, council member Randy Cauthen said.
“Seven people are not going to support a coffee shop,” he said.
At least 300 people work downtown, including about 200 at the Research Campus, Legg said, adding “they would support a coffee shop,” the often-mentioned barometer of a healthy downtown.
Other council members asked about Murdock’s plans for downtown. The Village, once an outlet center for home furnishings, became a hub for professionals two years ago when eight universities with projects at the Research Campus opened temporary offices.
But once the two massive university buildings on the campus opened last fall, most schools vacated their village offices and moved up the street to permanent quarters.
Downtown will grow and be “dynamic,” Legg said, but it will take longer than once thought due to the recession.
“It will be vibrant again,” he said. “At some point in time, the market will demand other retail and the village might transform again.”
Legg said he’s considering a new recommendation that the city build the police headquarters downtown instead of on Bethpage Road. That would bring people downtown, he said.
The new Rowan-Cabarrus Community College building at the Research Campus also will stimulate the downtown, he said.
And if the Cabarrus Health Alliance moves across from the Research Campus on Dale Earnhardt Boulevard, that would bring 200 to 300 employees downtown every day, he said.
“Don’t underestimate that,” Legg said.
Until now, the city has played a minor downtown role. Because Murdock owns nearly the entire area, his real estate firms have called the shots.
Sacks asked city council members to reconsider that arrangement.
“Does the city want to influence that, or are we going to leave it up to Castle & Cooke?” she said.
Castle & Cooke, Murdock’s developer, should announce its plans for the Village and whether it will encourage retail, Mayor Pro Tem Gene McCombs said.
“We have to know what they are going to to,” McCombs said.
“We need them in a discussion like this,” Cauthen said. “It’s not up to us.”
Lynne Scott Safrit, president of Castle & Cooke, told the Post last month that their plans for the Village have not been solidified and it would be “premature for me to discuss this.”
Legg said Castle & Cooke has the same goal as the city, to bring retail and people back to downtown.
“I’m not letting the cat out of the bag, but they have a couple good potential tenants,” he said.
According to Atlantic American Properties, Murdock’s property manager, the Village occupancy rate is 82 percent. But that will fall significantly when three furniture stores occupying 129,000 square feet close their doors.
Ktown Furniture, which sits on some of the only downtown land not owned by Murdock, went out of business this week.
Sacks suggested the city consider establishing municipal service districts, or areas where property and business owners pay an additional tax that goes toward development and revitalization.
Typically, cities establish a downtown development corporation to manage the funds raised by tax, which are reserved to market the area.
Concord, Salisbury, Mooresville and Charlotte all have municipal service districts. The average tax rate is 16 cents per $100 valuation.
Many cities supplement the district with additional money, Sacks said. She suggested that Kannapolis could establish the district and create a nonprofit to manage it.
Potential boundaries are West D Street, Main Street and Dale Earnhardt Boulevard.
“The difference with Kannapolis is that you have one owner,” Cauthen said. “I don’t know how this plays in with what he plans.”
The city has not approached Atlantic American Properties or Castle & Cooke about the proposed district, Sacks said.
If established now, Castle & Cooke would foot the bill because of the high vacancy rate, she said.
“Eventually, they would pass it on to the tenants,” she said.
Downtown businesses have asked the city for events like those hosted in Concord and Salisbury. But those cities have a downtown corporation, she said.
A municipal service district in Kannapolis would generate the revenue needed to host similar events, she said.
“Largely, this is for marketing and promotion,” Sacks said.
Sacks also suggested a facade improvement grant program, which could provide matching grants of up to $5,000 for facade, sign, parking or landscaping improvements.
“This would encourage the redevelopment of existing buildings,” she said.
Additional ideas included a small business incubator to help launch new companies and improving quality of life issues, such as offering curbside recycling and making the city more friendly for pedestrians to attract people and businesses.

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