Lowell's

Lowell's Supports the Carnegie Center

In any thriving community, there are some organizations which create lasting positive change. Our neighbors at the Carnegie Center for Literacy and Learning do that for Lexington.

Just a block from Lowell's in Gratz Park, The Carnegie Center weaves together a unique set of programs to make Lexington a better, more educated, more literate place.

For example, the Carnegie Center is working to establish Lexington as a nationally- and regionally-recognized center for literature. 

As part of that effort, the Center offers writing and publishing workshops and conferences for budding authors - helping new writers learn the process of starting, completing, and publishing their works. 

And these workshops are not just theoretical exercises: they include insights directly from literary agents and excellent local and regional writers, including Barbara Kingsolver, Nikky Finney, and Bobbie Ann Mason. New writers get to learn from experienced ones. 

Beyond writing, the Carnegie Center also offers adult workshops in such diverse topics as GRE preparation, yoga, computer use, bookbinding, entrepreneurship, Spanish, French, English as a second language, and blogging.  

Most of these courses are very reasonably priced, and many are offered for free.

Perhaps the most exciting aspect of the Carnegie Center is what they do for children.  This includes reading groups and book clubs for kids as young as 2 years old, and progresses into reading, writing, math, and Spanish classes for elementary school students. For middle school students, the Carnegie Center also offers classes in writing, computer-based art, and poetry.

 Not only does the Carnegie Center help adult writers - they are also nurturing Lexington's next generation of writers and readers.

At Lowell's, we are especially big fans of Carnegie's award-winning K-12 tutoring programs. These include one-on-one tutoring for over 180 students each week during the school year. Volunteers work with each student to help develop their reading, writing, and math proficiency. The program is so popular that all 180 spots were filled only minutes after the Center began accepting reservations.

Because the one-on-one tutoring program fills so soon, the Center also offers the Carnegie Club - after-school tutoring in small groups - and an additional summer tutoring program.

Even better? Most of the Carnegie Center's classes for kids are free, and the tutoring programs are $50 or less. 

With these (and many other) programs, the Carnegie Center is creating a new "Cycle of Literacy" - smarter kids, smarter adults, smarter writers - which creates new opportunities for individuals and substantial benefits for our entire community.  We are fortunate to have them here.

Lowell's is proud to support the Carnegie Center and its one-on-one tutoring program. We believe that smarter kids make a better Lexington.

And we love a better Lexington.

Your mechanic on Mechanic Street

Lowell's is Lexington's only mechanic on Mechanic Street.

Many of you know that Lowell's has been serving Lexington for more than 30 years from the same location at 111 Mechanic Street. We love being your mechanic on Mechanic!

While we like to joke that the street was named for Lowell's, we've long been curious about where the name came from.  "Mechanic" seems like a pretty new term, and we wondered if the street was relatively new or if the name had been changed from something else.  

So we were surprised to learn that it has been called Mechanic Street for nearly 200 years!

Today, "mechanic" is commonly used to refer to someone who works on machinery.  Back then, it had a somewhat different usage: "mechanic" referred to a variety of skilled tradesmen.  Essentially, "mechanic" was used in the same sense that we use "artisan" today.

Records from an 1818 directory of Lexington show an Elisha Babcock as Mechanic Street's only resident. In that directory, Babcock was listed as a "carriage maker".

200 years later, we'd like to think that we're doing a pretty good job of keeping up Mr. Babcock's legacy of helping Lexington move forward!

If you're curious about the data, Richard E. Stevens of the University of Delaware compiled historical datasets from many U.S. cities.  I found Elisha Babcock in the 1818 Lexington Directory (Excel file) and 1818 tax rolls (DBF file - can be opened with Excel).  I also found RootsWeb's Fayette County resources and maps to be useful in my research.  Access Geneology lists many other Kentucky directories, as well.  

And now for the hard part...

Critics have identified three interrelated categories of problems for CentrePointe since it was introduced to the public in 2008:

1. Context.  Will it 'fit' with downtown Lexington?
2. Financing.  Will it be built?
3. Viability.  If built, will it work?

And CentrePointe has consistently failed across all three dimensions.  It didn't fit Lexington.  It couldn't be financed.  And it wasn't viable.

As the project has changed trajectory in the past few months, it is worth re-examining these critiques.

Context
The first three iterations of CentrePointe were uninspired and uninspiring.  The designs seemed devoid of place - as though they could be plopped down on any block in any random city - Nashville, Atlanta, Phoenix, Detroit.  There was nothing about the designs which was particular to Lexington.

The bland and imposing structures were also the architectural equivalents of bullies - crowding Main Street, unwelcoming to pedestrians, overshadowing nearby buildings, and oblivious to the surrounding fabric of downtown.  

The heavy-handed designs seemed to mirror the developers' if-you-don't-like-it-well-that's-just-too-damn-bad demeanor.

In recent weeks, however, we have begun to see much more hope for CentrePointe.  With help from the mayor, the developers engaged Chicago's Studio Gang Architects (SGA) to reconceive the site. And the developers have interacted much more with the public and the press - including a quasi-interview with the developer which utilized our questions from an earlier post. (We'd like to ask some follow-ups!)

Jeanne Gang presented her firm's initial architectural concept for the CentrePointe block to a packed crowd at the Kentucky Theatre last week.

It was a great design.

And like most great designs, it poses elegant solutions to several problems at once.  Here are a few highlights which caught our attention:

• Mass.  SGA departed from previous monolithic designs, and redistributed the mass of the project across the site.  The new asymmetric distribution allows the design to accomplish a number of goals.  Breaking the project into components also opens the possibility that the site might be developed in phases - perhaps as financing becomes available.
• Main Street.  Along Main Street, SGA proposes having 6 distinct building designs which would mirror the varied designs across the street and which would also help maintain the organic, eclectic feeling of a typical Main Street.
• Inclusiveness.  To help ensure distinct building designs along Main Street, SGA has selected five local architects to design 5 of the 6 buildings on that side of CentrePointe.
• Plays Nice.  Unlike the earlier "bully" designs, this one seems to play nicely with the surrounding city. SGA used "shadow studies" to assess how the 30-story tower might throw shadows over nearby buildings.  Those studies helped them decide to place the tower near the corner of Upper and Vine Streets, where the building would be less overpowering on the surrounding blocks.  
• Circulation.  This design also departs from earlier versions in that it promotes pedestrian circulation with the surrounding city and within the site, with ample open spaces and public areas.  It is able to accommodate parking access for cars without significantly disrupting pedestrian access.
• Lexington.  Studio Gang are trying to give the project local meaning - connecting it to our history, stories, and environment.   And while I'm skeptical of the real utility of "the connected separateness of paddocks" or "the porosity of limestone" as sources of inspiration for the new design, SGA is the first CentrePointe architect who seems to realize that it will be built in a unique setting within our unique city.  

Studio Gang have crafted this particular design to this particular spot in Lexington, and the result is very encouraging.  Lexington may finally have a signature project worthy of the center of our city.

Financing
The changes in the nature of the CentrePointe project don't alter the economic environment for getting the project funded.  

While now armed with a world-class architect and a world-class design, the developers are still faced with the enormous challenge of finding funding while the commercial real estate market remains in severe recession.  

Investors will be far less interested in the aesthetics of the project than its financial viability as an investment vehicle...

Viability
Our central criticism of CentrePointe over the past few years has been its economic viability.  We've spent a lot of time deconstructing the economics of CentrePointe, and whether it can 'work' as an economic entity.

In short, the project wasn't - and still isn't - realistic.

Each of the four components of the project (condominiums, hotel, retail, and office) demanded exceptionally high prices and required exceptionally high occupancy to be successful.

Despite the inclusion of SGA in the design of CentrePointe, the developers won't be able to achieve the levels of occupancy needed to make the project successful.  (Both prices and occupancy were far in excess of the Lexington market.)

The project also needed the infusion of Tax Increment Financing (TIF) from the state and city to help pay for 'public' improvements to the site (including sidewalks, parking garage, storm sewers, and other infrastructure).  

The city and state would issue TIF bonds (debt) to pay for today's improvements, and would pay them back with interest by harvesting future tax revenues coming out of the CentrePointe site.

And, as we have shown before, the CentrePointe TIF - based on incredibly optimistic assumptions - never pays back the city or state for their investment.  In essence, TIF amounts to corporate welfare for the developers.

And no knowledgeable bond analyst would ever recommend the CentrePointe TIF to his or her investors.  It would never pay them back.

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Over the past three years, CentrePointe seemed like a lose-lose for Lexington: We lost if the project wasn't built; we lost if it was built, too.

CentrePointe was a bad idea.  And it was badly executed.

The new approach to designing CentrePointe is different: This new design incorporates so many great ideas, and it seems to function so well with downtown Lexington.  

Studio Gang has helped transform the threefold criticism of CentrePointe - It doesn't fit Lexington; It can't be financed; It isn't viable - into a twofold critique.  CentrePointe still can't be financed.  It still isn't viable.  

While still deeply skeptical about the project's economic viability (and its value for Lexington), we find ourselves pulling for this vision of the project - just a little.  

This CentrePointe seems like a good idea - maybe even a great one.  And that's the first time we can legitimately say that about CentrePointe.  

But great ideas are the easy part.  

Now, the community's attention must turn to the hard part of CentrePointe: Execution.

The transition to execution poses new challenges for the developers and for Studio Gang.  

How will the project find funding?  Can they conceive a more realistic plan which pulls back from today's more ambitious design?  Can they make a 20-story tower work, for instance?  Can they craft an economic model which doesn't rely so heavily on TIF?  Can they build smaller parts of the project today, and finance the rest when the economy improves?

The future of downtown might rest on the answers.

UPDATE 7/18/2011: Jeff Fugate has an excellent post on what the new design of CentrePointe accomplishes over at ProgressLex.

The Promise (and Predicament) of CentrePointe

Since CentrePointe was initially proposed over three years ago, the project has been marked by fantastical bluster, broken promises, poor designs, and, ultimately, a failure to build.  All of which was compounded by the developers' riteously indignant, arrogant, and combative attitude when challenged on the wisdom of CentrePointe.

A couple of years ago, after declaring CentrePointe an impossible-to-build failure, we outlined some basic principles for reconceiving the (still) empty block in the heart of our city.  Here's an abbreviated excerpt from that post:

• Create a vibrant destination which attracts residents, workers, and tourists.
• Make that destination a distinctive place which no other city has.
• Create public and private spaces within the destination.
• Balance the types of uses within the development.
• Ensure local businesses have significant presence.
• Ensure that the space is well-integrated with the surrounding community.
• Build it soon.

After three years of apparent tone-deafness by CentrePointe's developers, the prospects for such a "signature place" seemed quite dim.

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On the sweltering third floor of the old courthouse yesterday, an overflow crowd of some 300 Lexingtonians received a tantalizing glimpse of a new approach to the CentrePointe project.

And that approach represented an enormous (and refreshing) step in the right direction.

With the encouragement of Lexington's new mayor, the developers engaged Jeanne Gang of Chicago's Studio Gang Architects (SGA) to rethink the CentrePointe block.

On Thursday, she present preliminary site design concepts for the CentrePointe block.  And she presented a marked departure from the old approach to CentrePointe.

Gang's presentation and the developers' new approach are refreshing in a number of ways:

• Design. SGA abandons the "Fortress Lexington" approach of the old CentrePointe.  By breaking the project into independent components with different volumes and designs, SGA will avoid the imposing and monolithic designs offered in previous iterations of CentrePointe.
• Openness. By showing preliminary design concepts and inviting public input on them, CentrePointe promises to be a much more open project.  The developers are even inviting local architects to design the Main Street components of the project.
• Humility. Gang showed her work and her thinking while it was still in progress, while it was still incomplete.  Exposing this level of uncertainty takes a striking degree of humility and confidence - for both the architect and the developer.  Whereas previous iterations of CentrePointe were presented as a fait accompli to be adored by a passive audience, SGA's version promises to be a shared community treasure which we might be able to design together.  In this more humble regime, once-adversarial relationships might transform into more-cooperative ones.

The mayor and the developers and SGA are to be commended for crafting this new approach to CentrePointe.  

The chances for creating a unique, signature place for Lexington went way up yesterday. And the developers deserve some credit for allowing that to happen.

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Despite the new approach to designing CentrePointe, a number of nagging issues remain for the tortuous project.

While Gang's site design breaks up the monolithic tower of previous CentrePointe concepts, it appears to maintain the overall square footage and volume of the last iteration of the project.  If the project is roughly the same size, it should be roughly the same cost - around $200 million.

And if the developers have had difficulty lining up financing for the past three years, what will allow them to line it up now?  The commercial real estate market remains deeply depressed, and it isn't clear that such abundant premium space would find tenants in Lexington.  The business model issues we identified early in the project haven't fundamentally changed.

Is it possible that the new design will be so revolutionary, so inspirational, so great that investors and tenants will line up around the CentrePointe block to get in?  Perhaps.  We'd be thrilled.  But we doubt it.

The $200 million price tag is also important because that is the minimum required to qualify for tax increment financing (TIF).  TIF allows cities and states to allocate future incremental tax revenues to finance today's public improvements related to new economic development initiatives.  

In CentrePointe's case, the city and state would finance about $50 million in improvements - a parking garage, sidewalks, storm sewers, etc. - around the project, and they would hope to recoup that investment from new taxes generated by CentrePointe.  In previous analysis, we've found that the CentrePointe TIF is highly problematic, and that it is doubtful that the city or state would ever get their money back.

Even though the new design direction is encouraging, several other aspects of the project are still unresolved.  Is the project the appropriate scale for Lexington?  Can it find willing tenants? Can the developers nail down financing?  Is the TIF worth the up-front expense?

The developers find themselves in a dilemma: If their project falls below the $200 million mark, it will be much more realistic to finance and to find occupants.  But it will lose the $50 million boost from TIF financing.  

If the project comes in over $200 million, it is much more difficult to finance and occupy, and the opportunity for financing the project in the next 5 to 6 years looks grim.  (The TIF agreement between the Kentucky Economic Development Finance Authority and the city specifies that the $200 million be spent by January 2015).

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We applaud the developers' new, more-open approach to designing CentrePointe.  Bringing Jeanne Gang and SGA in to rethink the site is a welcome departure from the past three years. As frequent critics of CentrePointe and its developers, we're very encouraged by the new direction of the project.

But because the economic challenges to the project linger on, we'd like to see a more open, more flexible approach applied to the execution of the project as well.  Perhaps the project could be built progressively or in stages, to allow for further construction as new financing becomes available. Perhaps it could be downsized to multiply financing options.  

If - and this is a big 'if' - the developers can rethink their business model the way they've begun to rethink the design, the future of CentrePointe may be bright indeed.

UPDATE 6/6/2011: Graham Pohl now has a fine post up on an architect's perspective of the new CentrePointe design and process over at ProgressLex.

Small Business Saturday

It should come as no surprise to our regular readers that Lowell's supports small local businesses.

Local businesses reinvest in our community's economy.  Small businesses create most of our nation's jobs.  We have frequently promoted many of the small businesses you can visit in our thriving North Limestone neighborhood.  

So we really like the idea of declaring the Saturday after Thanksgiving (November 27th) as "Small Business Saturday".

Small Business Saturday is a day to patronize small local businesses for holiday shopping needs (which distinguishes it from cousins "Black Friday" on November 26th and "Cyber Monday" on November 29th).

The initiative is nominally sponsored by American Express, but Small Business Saturday has taken on a decidedly grassroots form, with many small businesses seizing upon the opportunity to appeal to local customers.

Small Business Saturday won't make or break local businesses, and it shouldn't substitute for patronizing great independent businesses on an ongoing basis (such as outlined in The 3/50 Project). But it is a great way to celebrate the many small businesses which help grow the local economy.

While Lowell's will be closed on Small Business Saturday, we encourage our friends and customers to use the day to buy the things that they need from the small local businesses that they love.

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Need some ideas for great local businesses in Lexington?  Take a look at business listings at Local First Lexington and Kentucky Proud for some great ideas.

David Bullard Leaving Lowell's

After nearly four years with Lowell's in Lexington, David Bullard - one of our highly-skilled technicians - is returning to his hometown shop in Florence, Kentucky. While we are sad to see David leave, we really appreciate his contributions here over the past four years. 

We'd love for you to help us say goodbye to David. This Friday, July 30th at noon, we'll be having a pizza party at the shop, and we're inviting our friends and customers to join us. We'll be bringing in lots of Mellow Mushroom pizza for you (Kosmic Karma is David's favorite), and - as always - you can get 5-cent Cokes from our machine. 

Please join us as we bid farewell to one of our own. 

We hope to see you this Friday, 
Rob, Suzanne, and your Friends at Lowell's

The CentrePointe Scam

We've long been critical of the economics of the proposed CentrePointe development just a few blocks away in downtown Lexington.  

One of the least understood portions of the project is the element known as Tax Increment Financing, or TIF.

In essence, TIF allows cities and states to allocate future incremental tax revenues to finance today's public improvements related to new economic development initiatives.  

The recent changes to the CentrePointe project invite a reassessment of the CentrePointe TIF program.

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CentrePointe's TIF program would use future new tax revenues from the CentrePointe development to fund about $50 million in projects around CentrePointe.

These public initiatives would include:

• A new underground parking garage beneath Phoenix Park;
• Renovating Phoenix Park;
• Renovating the old Fayette County Courthouse (now the Lexington History Museum); and,
• Providing new infrastructure including storm sewers, sidewalks, and - according to the most recent renderings - a pedway which seems to cross Upper Street to (?!) McCarthy's Irish Pub.

The state and city would issue some $50 million in 30-year bonds (i.e., public debt) to fund the initiatives.  Over the course of the next 30 years, our governments would pay out some $100 million in principal and interest to the investors in the CentrePointe TIF bonds.  The state would cover three-quarters of the total payments (about $72 million), and Lexington would cover the rest.  

Then, the state and city would hope to use new taxes generated from CentrePointe over the next 30 years to offset the $100 million spent paying bondholders.

But is this a good investment of taxpayer dollars?

To get an informed answer, we need to dive deep into the business fundamentals of the CentrePointe TIF project.

(Note: What follows is financially 'geeky', but it is also critical to understanding how our money is invested.)

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We have two major concerns with the CentrePointe TIF:

1. The valuation methodologies used by the state and city are fundamentally flawed, and are not the standard for evaluating a long-term investment.
2. CentrePointe will not generate the promised revenues, due to incredibly optimistic business model assumptions.

Let's look at each of these concerns in succession.

Valuation Methodology
As far as we can tell, there have only been two evaluations of the public impacts of the CentrePointe project:

• A late 2008 assessment of CentrePointe done for Lexington by Morgan Keegan & Company which expected $211 million in total tax revenues over 30 years; and,
• An Economic Research Associates (ERA) report [PDF Link] done last summer for the state's Cabinet for Economic Development, which expected nearly $70 million in tax revenues from CentrePointe for the state alone.

Of the two, ERA's assessment is the more recent, more complete, and - in our judgment - more reliable.  It is also the one which the state used to approve the CentrePointe TIF.

But, as mentioned above, there are deep flaws in how both of these reports valued the public benefits stemming from CentrePointe.

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Businesses make investment decisions all the time: products, facilities, acquisitions, marketing, and so on.  

When businesses evaluate an investment project, they look at how much they put in up front ('the investment') versus how much they can get out over time ('the return').  

But when looking out into the future, most businesses lower the value of future earnings.  In other words, the promise of $1 million next year isn't worth as much as $1 million in-hand today.  A lot of things can happen in the course of a year - inflation, disasters, competition, market shifts.  And $1 million two years from now is worth even less, because there is even more risk of something happening.

Typically, stable and established businesses use an annual rate of around 10% to 'discount' future earnings.  For example, if an investment generates a return of $1 million today, that is valued at $1 million.  Simple enough.  But if it promises another $1 million next year, that is worth just $900,000 to us today (i.e., 10% off of $1 million). The promise of $1 million two years from now is worth just $810,000 today, and earnings further in the future are given even steeper cuts in their valuations.  So the promise of $1 million 30 years from now is worth just $42,000.

This 'discounted cash flow' method is the same standard that Warren Buffett and other investors use to evaluate how much to pay for an investment, and it is the financial equivalent of 'a bird in hand is worth two in the bush'.

Depending on the kinds of risks an investment faces, the discount rate might be significantly higher.

When we purchased Lowell's, we used a 20% discount rate.  Even though Lowell's was a solid business with loyal customers, we faced a number of uncertainties.  Would we lose key employees? Would customers stay away in droves?  Would things fall apart? Those things didn't happen, but they posed very real risks as we purchased a new business.

With an especially speculative venture like CentrePointe, we would usually apply an annual discount rate of 20%. Or more.

So what kind of discount did Morgan Keegan and ERA apply to CentrePointe's promised future tax revenues?  

Zero.

Instead of incorporating the risks inherent with a project like CentrePointe, these assessments valued CentrePointe as if there were no risks at all. In these scenarios, the faint promise of $1 million in 2040 from CentrePointe was just as secure as having $1 million in our wallet today. 

This is especially problematic, because so much of CentrePointe's tax revenues were promised so far in the future, when a conventional valuation methodology would steeply cut their value.

For instance, in Morgan Keegan's assessment, nearly half of CentrePointe's tax benefits - over $100 million - came between 2030 and 2040. 

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The original report [PDF link] from Economic Research Associates (the state's CentrePointe consultant) estimated that 30 years of tax revenues from CentrePointe would generate some $70 million for the state - while the state's expenses for CentrePointe projects ran $72 million.  So ERA projected that the state stood to lose $2 million on the CentrePointe TIF.  

And that estimate derived from the faulty methodology we described above.

So what does the CentrePointe TIF look like when we apply standard valuation techniques?  Let's be generous, and apply the 10% annual discount rate reserved for stable investments to our analysis of CentrePointe.  We'll also use ERA's estimated stream of future tax revenues.

Using a more conventional valuation of CentrePointe's incremental taxes, they're only worth about $25 million to the state, and an estimated $32 million overall.

In reality, the city and state would incur $50 million in public debt today for the CentrePointe TIF bonds, and only get back $32 million of that in future tax revenues.  CentrePointe TIF is a poor investment which loses $18 million for taxpayers.

And that is even before we look at the stability of CentrePointe's overly-optimistic business model...

Business Model Assumptions
A distinct pattern emerges in ERA's assessment [PDF link] of the CentrePointe project for the state. At numerous points throughout the document, ERA hedges: they express skepticism about some element of the project, but then use the developer's assertions about the project as 'proof' of its ultimate viability.

How ERA evaluates CentrePointe's million-dollar condominiums is typical of these hedges (we've added emphasis in red):

"ERA approaches new luxury condominium projects in 2009 with a healthy degree of skepticism. [...] Bank financing for new condominium construction has seized up. There is a very high degree of uncertainty in residential markets, especially high-end condominiums, across the U.S.  And in recessionary times, introducing a luxury product where it has not been present before represents a considerable risk.

"However, there are two reasons for optimism in the CentrePointe Tower. First, the developers have pledged an all-equity transaction. This greatly reduces the risk that loans would have to be renegotiated in the middle of a deal, that payments would be missed, or that financing would be pulled at the last minute. While it does not eliminate all risks associated with financing, an all equity transaction greatly reduces the risks and complications of development in this difficult market.

"The second reason for optimism is that the developers have reservations for 64 units, out of 91. While a reservation is less a commitment than a purchase contract, this is still an impressive level of sales for this stage of the process. With two-thirds of units reserved before construction begins, the developers have demonstrated there is demand for these types of units."

Both of the reasons for optimism that ERA cites come directly from the developer's tenuous assertions.

The 'all-equity transaction' refers to the developer's dead mystery financier, whom the developer had claimed was putting up cash (the 'all-equity' part of the transaction) to back the development. Last week, the developer admitted that he was forced to pursue more conventional financing.  Using ERA's logic, this would greatly increase the risks to the project's success.

The 'reservations for 64 units' refers to the handshake deals that the developer claimed for the old CentrePointe design.  As we have previously documented, 64 'reservations' stretches the bounds of credibility in a market which only sold 10 million-dollar properties in all of 2008. And last week, the developer trimmed the number of condominiums in the new design from 91 to 63.

(Update: As Beverly Fortune notes, the numbers haven't gotten better for million-dollar residential properties: Only 8 sold in Lexington in 2009, and only 5 have sold thus far in 2010.)  

With both 'reasons for optimism' now rendered impotent, how would ERA evaluate CentrePointe's condominiums today?

ERA's skepticism extends to every other major part of the project:

Offices: "Estimated rents of $26 per square foot would be about $6 per square foot higher than the current highest quoted rate in the market – a number that may be difficult to achieve given current market conditions and may require some concessions."

Retail and Restaurant: "ERA believes that $27 per square foot is an aggressive ask in this market, especially in downtown."

Hotel: "With a first year ADR [room rate] of $175 and RevPAR [revenue per available room] of $103 at 53 and 45 percent higher than any comparable properties in the market at the end of 2008, these metrics may be optimistic. [...] Projected hotel occupancy as well, is projected by the developer to be nearly 10 percentage points higher than the 2008 year-end average of 61.9 percent."

In evaluating the entire project, ERA says

"Traditional bank financing would be extremely difficult, if not impossible, to secure for a project of this scale at a time like this. [...] If the project’s equity financing remains intact and the investors are satisfied with the projected return, then ERA does not see a market barrier to feasibility of the project."

How would ERA evaluate CentrePointe's feasibility now that the 'equity financing' has fallen through?

Not well, we suspect.

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We took the liberty of re-running ERA's estimates with more realistic (but still quite generous) assumptions:

• The developer estimated that he would spend about $250 million on the old CentrePointe design. While there are few specifics, he has used a figure of $200 million for the new design.  We adjusted construction spending down by 20%.
• The developer assumed they could get higher occupancy levels (over 71%) even though they were charging 50% more per night than the Lexington hotel market.We adjusted hotel occupancy to market levels - a more reasonable 62%.
• The developer has claimed to be able to sell two-thirds of their condominiums at the outset of the project. We adjusted expectations down to about 20% at the outset, and we never expect full occupancy of the 63 condos without drastic reductions in property price.
• The developer assumes a $26 to $27 per square foot rate for its office, retail, and restaurant leases.  We've adjusted those assumptions down by about 20%. Such an adjustment still leaves these CentrePointe spaces as the highest rents in the Lexington market.

These adjustments to the CentrePointe business model have a number of economic ripple effects: Lower spending, lower sales, lower profits, fewer jobs created, lower quality of tenants, and lower tax revenues.  

Using these more realistic assumptions, our estimate is that CentrePointe will generate incremental state and local taxes worth only $21.5 million ($16 million of that would go to the state, and the remaining $5.5 million would go to Lexington).

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As long-time critics of the CentrePointe project, we hear a common counter-argument: that CentrePointe is a private development on private property and that we and our community leaders have no business questioning the project.  

CentrePointe is a private development on private property.

But CentrePointe also has a number of externalities that make it of public interest. It would require significant public investment in new infrastructure and facilities to support the new development.

And while TIF projects are targeted to public improvements, the reality is that about half of the $50 million publicly-financed CentrePointe TIF projects would most directly benefit CentrePointe's developer: the parking garage, sidewalks, pedways, and other infrastructure. 

It is highly unlikely that the developer would go forward with the project without the public subsidy of these elements - despite his prior threats to do so.

A second TIF reality is that the public bears a disproportionate part of the risk of the new development: In return for putting up $50 million of our money today, taxpayers are promised an unreliable trickle of future tax payments over the next thirty years.

So despite what many of CentrePointe's defenders - including Lexington's mayor - say, CentrePointe's TIF program does amount to a public subsidy of the private development of CentrePointe.  

And when we apply a realistic analysis, that CentrePointe TIF subsidy is a truly awful investment. 

In return for committing $50 million in new debt (and paying another $50 million in interest on top of that), taxpayers get a return of just $21.5 million.  

Local government would lose almost $7 million on its $12 million investment, while the state would lose $21 million on its $37 million investment.

And despite the developer's indignant none-of-your-damn-business attitude toward public inquiry on CentrePointe, it clearly is a public issue with public dollars at stake.  The CentrePointe TIF is little more than outright welfare for the developer and his project.

The CentrePointe TIF is a spectacularly bad public investment, and every attempt should be made to rescind the TIF approval.

The proposed redesign of CentrePointe should be a time for community leaders to rethink the community's investment in CentrePointe.

At a time when our public budgets are under extreme duress, now is not the time to spend extravagantly on a wildly speculative private development such as CentrePointe.

No responsible business would make this kind of investment.  Our governments shouldn't either.

The Tombstone at CentrePointe

We last wrote about CentrePointe one year ago this week.  

In Tangled Webb, we wrote about the folly of the CentrePointe development, capping a series of posts chronicling our growing skepticism about the downtown Lexington project's financing and viability.

We then stopped writing about CentrePointe because there wasn't much left to say.

Four months later, Business Lexington reprinted Tangled Webb, prompting an aggressive and condescending response from CentrePointe's developer, in which he simultaneously attacked us, bloggers in general, and Business Lexington.  He asserted that we knew "little about commercial real estate development or the potential and viability of this project".  

Time would tell.

New v. old CentrePointe designs

A New CentrePointe?
Yesterday, finally admitting that his financial backing had failed and that his initial design wasn't viable, the developer submitted a smaller design for CentrePointe to the Courthouse Area Design Review Board (CADRB).

The new tombstone-shaped design (shown at right, superimposed over the older design) is 210 feet shorter than the one that the CADRB had previously approved.

The project still proposes a 237-room J.W. Marriott, along with office and retail space.  The upper tiers of the project would house 63 high-end condominiums (scaled back from the originally-proposed 91).

The developer asserts that "progress is being made" on "more conventional financing".

What is the CADRB?
Within Lexington's crazy-quilt of planning bodies and agencies, the CADRB is a five-person board commissioned by the Urban County Council to oversee a small portion of downtown called the Courthouse Area Design Overlay Zone.  The CentrePointe site falls within this irregularly-shaped zone.

In 2008, the CADRB approved the developer's demolition of several long-neglected-but-historic buildings on the site - including Morton's Row, which had some of Lexington's oldest commercial buildings.  In June 2008, the CADRB approved an initial design for CentrePointe, issuing an "authorization permit" good for one year.  The CADRB  then approved a modified design again in November 2008.  

On July 8th, 2009 the developers sought - and received - an early extension to their November 2008 authorization permit.   That third permit expires less than 30 days from today.

The Overlay Zone is intended to "encourage growth and redevelopment in the downtown area, while preserving and protecting the unique features and characteristics of the area."  As outlined in its bylaws, the CADRB has 5 mandates:

• promote those qualities in the environment which bring value to the community;
• foster the attractiveness and functional utility of the community as a place to live and work;
• preserve the character and quality of Lexington’s heritage by maintaining those areas which have special historic significance;
• protect investment in those areas;
• raise the level of community expectations for the quality of its environment.

Since initial approval, the CentrePointe site has been, by turns, a pit of rubble, a dust bowl, a pond, and, now, a horseless horse pasture with huge signs heralding how CentrePointe is "Coming Soon".

By issuing demolition and construction permits for the CentrePointe site, the CADRB failed on every one of its own mandates.  The development has failed to bring value to the community.  It has failed to deliver the promised 900 jobs.  It has failed to preserve the character and quality of Lexington's heritage.  The fantastical proposal never had the right scale or proportion for the Overlay Zone. Along every dimension, CentrePointe has been a collossal failure.

In light of that multidimensional failure, now is the time for the CADRB to take corrective action.

New design, same old problems
While scaled back in height, the new 'Pointe-less' design for CentrePointe is no less problematic than the old one.  It fails to address some of the project's deep, long-standing flaws. These include:

Financing: While the developer asserts that progress is being made on new funding, this is actually a step back from previous assertions that funding was already in hand.  On June 4th, 2009, the developer assured the Lexington Forum that he had two ready sources of funding if his dead mystery financier's estate didn't come through.  Yesterday's application for extension made it clear that those sources failed as well - if they ever existed at all.  

Capital flows to the most promising investments, even in a difficult economic environment.  The fact that the developer has yet to secure funding for CentrePointe speaks volumes about its quality as an investment.

Business Model: The developer has continually asserted that he has a ready list of tenants for the property.

But there are enough problems with his business model assumptions to call the viability of the entire project into question.

• Analysts hired by the developer assumed that the J.W. Marriott hotel could achieve higher occupancy rates - at start-up - than surrounding hotels even though the Marriott would charge 50% higher room rates.
• While the number of million-dollar condomimiums has now been scaled back to 63, that is still far too many for the Lexington market to absorb (when only 10 million-dollar properties sold in all of Lexington in 2008).  
• The one retail prospect that the developer has named as 'interested' in the project wasn't really that interested.

Vague Assurances & Broken Promises: The developer has offered many claims - but little substance - with regard to the project's viability.  He has repeatedly decommitted from previous promises.  When challenged, the developer usually responds by playing either victim or bully - and, sometimes, both at once.

It is time to openly challenge the developer's overreaching claims and blithe assurances.

Scale: CentrePointe's proposed tower has never had the appropriate scale for the historic character of the Overlay Zone.  The CADRB's approval of the initial designs and subsequent re-approvals were mistakes.

Now is their chance to undo those mistakes.

Accountability for CentrePointe
Before issuing a fourth permit, the CADRB needs to require the kinds of accountability for this iteration of CentrePointe that was missing in the project's earlier phases.  

They have a responsibility to ensure that our community does not end up with - in the words of former Councilmember Don Blevins Jr. - a "vertical Lexington Mall".

When the developer presents CentrePointe's new design to the CADRB on June 30th, the board should do the following:

Ask the tough questions.  Especially the ones which weren't answered the first time.

• Does the developer have financing in hand, or is he just 'working on it'?
• What, exactly, happened to CentrePointe's previously 'rock-solid' financing?
• Can the developer really build the design being considered?
• What is the business model for this property?  Will that model really work?
• Is this design really consistent with the unique character of our downtown?

Require documentation.  Don't accept the developer's word at face value.  His proven inability to deliver on previous promises mean that he should be required to document the stability of his financing and his business model before any design is approved.  

Rethink prior approvals. As mentioned above, the CADRB made a mistake by approving the old design of CentrePointe.  Don't just rubber-stamp the new 'tombstone' design.  Make sure it works with the surrounding community.

The Overlay Zone exists for a reason.  On June 30th, The CADRB should fulfill their duty to ensure responsible economic development within the Zone which preserves the unique character of our downtown.

The old design of CentrePointe didn't do that.

The new one still doesn't.

The CADRB should reject the application for extension.

It is time to put a stop to the empty promises.  It is time to stop enabling this kind of overreaching incompetence.  It is time to end the delusional fantasy of CentrePointe.

While you wait: Superlative Coffee Roasters

116 Mechanic Street, 2009

Last year, I wrote about some of the neglected properties surrounding Lowell's, including a small run-down house across Mechanic Street from our lobby.  

The house was long-abandoned, and the giant half-dead tree in front hung menacingly over passersby. 

A few months ago, that little house was sold to new owners, who spent a lot of time and money renovating the building and removing the rotting tree.  

The result: a very nice example of refitting an older property for a modern use.

116 Mechanic Street, Today

Last week, Superlative Coffee Roasters opened up for business at the new, much-improved 116 Mechanic Street.  Superlative is a craft roaster of organic, fair trade coffees.

Jenny Super, Superlative's owner, has offered to let Lowell's customers taste samples of one of her small-batch coffees through the end of June.

Today, I sampled the shop's Signature Blend.  Wonderful, wonderful stuff.

The Little Red Roaster

While there, be sure to check out their Little Red Roaster - It is often busy roasting up the latest fresh batch of beans.

Superlative is a welcome addition to our vibrant North Limestone neighborhood. Please lend your support to this great local business!

Come by the shop, pick up one of Superlative's free sample cards, and cross the street for a delicious free cup!

Superlative Coffee Roasters
116 Mechanic Street
Lexington, KY 40507
859.252.5000
Jennifer Super, Owner and Craft Roaster
superlativecoffee.com
Twitter: SipSavorShare

Will Creative Cities Matter?

Lexington hosted the third installment of the Creative Cities Summit late last week (previous editions were in St. Petersburg in 2004 and Detroit in 2008), and the event was headlined by internationally-recognized experts in urban growth and vitality: Charles Landry, Rebecca Ryan, Richard Florida, and Bill Strickland, among others.  

 The event drew participants from across North America, but most of the attendees seemed to be from Lexington.  And while Lexington was not the central focus of the event, our city naturally entered into many of the conversations.

In the wake of the event, a vigorous local debate emerged about whether Creative Cities was significant for our city.  What's intriguing is that much of the debate is occurring between folks who normally get along.  And much of the negative criticism is coming from folks that I like and respect (see here, here, here, and here), and who aren't typically curmudgeonly.

That criticism has led to head-scratching - and, at times, indignance - from those who felt that the summit was a worthwhile, transformational, and enlightening experience.  

And that leads us to an interesting - and telling - distinction: Most of the attendees of the summit seemed energized by the discussions and the ideas which emerged from Creative Cities; Most of the criticism came from those not in attendance.  

* * *

There seem to be three basic criticisms of Creative Cities:

1. It was too exclusive.  This criticism usually centers around conference participation: who was invited, who wasn't, and the perceived snobbery of some of the attendees.

2. It was too expensive.  This criticism focuses on the $199 registration, and whether the scholarships to the event were adequately publicized.

3. It was too much talk (and much of that talk was self-involved drivel).  This criticism takes multiple forms, including:

• The conference was too self-involved and self-congratulatory, and prioritized self-help and good feelings over substantial change.
• It glorified out-of-town gurus who repackaged the obvious while angling for their next consulting gig.
• It didn't involve enough meaningful action, and thus amounted to a vacuous echo-chamber of do-nothing happytalk.

As an attendee of the summit, I find a kernel of truth in all of these criticisms.  But I don't think that any of them are completely fair, and none are particularly helpful in crafting a better future for Lexington.  

I have to admit I'm not all that patient with the 'exclusive' or 'expensive' arguments.  Everyone was invited; everyone had a chance to participate.  While the price of the event was problematic for many, it was far cheaper than similar events with participants of this caliber.  Events like this cost a lot - and high-quality speakers, food, and facilities are necessary to draw a national audience.

What concerned me the most about these critiques was that the perceived exclusivity or expense of the event often became an excuse for dismissing the good ideas which arose there: A good idea is still a good idea, even when someone has to pay to hear it.  

And if the criticisms of conference ideas are based upon bruised egos and hurt feelings, then I've got zero patience for that.

I'm much more sympathetic to the 'too much talk' reasoning.  

Before I bought Lowell's, much of my corporate life was spent in the company of very skilled consultants: research consultants, design consultants, business strategy consultants.  

There was a predictable part of nearly every consulting engagement where the consultant would suggest that hiring them for another engagement was part of the solution to the problems we hired them to resolve - "The way you fix that is to hire me again!".  Consultants always position themselves for doing more consulting.

We did get to see that angling-for-the-next-gig routine with some consultants at Creative Cities.

And admittedly, there was a little too much excitement over slick ideas and catch-phrases, and not enough thought about the hard work needed to truly transform Lexington for the better.

But that hard work isn't what a conference is for: The summit was for learning and for exchanging ideas; the hard work comes after.

* * *

The structure of the conference didn't help its perception - especially on Twitter - for those who didn't attend.  In the process, I think some of the shortcomings of Twitter for civic conversations like these were exposed.

The most compelling (and, presumably, highest-paid) 'keynote' speakers addressed all participants at the same time.  For these speakers, attendees usually tweeted about the same inspiring messages, giving rise to the echo-chamber perception.

For instance, when Bill Strickland spoke at the end of the conference, many non-attendees mocked his 'poor people should be considered assets, not liabilities' line.  They seemed to say What fool would pay to hear something so blatantly obvious?  

But Strickland had spent several emotional minutes demonstrating how attitudes, institutions, and architecture in his native Pittsburgh neighborhood treated poor people like liabilities.  At the same time, he had shown how he had successfully used beauty and light and architecture and respect to transform his home neighborhood by treating poor people like assets.

When those present tweeted the 'assets' line, they were truly moved and inspired by Strickland's story and context.  Those outside the venue only saw vacant platitudes.

This same pattern repeated itself again and again throughout the other keynotes: The rich, compelling images and backgrounds and stories couldn't traverse Twitter effectively; only the catchiest (and apparently empty) phrases made it out.

In between keynotes, there were 4 simultaneous breakout sessions.  While the breakouts weren't as inspiring (or 'tweet-worthy'), they were far more practical and hands-on about the mechanics of transforming a city for the better.  They were - for me - the most beneficial part of the conference.  I learned about:

• Detroit's strategies for reviving long-neglected neighborhoods, building-by-building and block-by-block.
• How Toronto and Portland are funding and implementing inspiring, for-profit social innovation initiatives which pull people and neighborhoods out of poverty and make their cities more livable.
• The model Massachussetts' Creative Economy Director uses to get tangible economic development successes in arts, software, design, video games, and music.

From the discussions around my table, other Lexingtonians learned even more from the sessions I wasn't able to attend.  We also talked with people on the ground in Atlanta, Des Moines, and San Antonio about their experiences in their cities.

Because I was so busy listening and taking notes, I was much less occupied with getting the word out on Twitter.  I saw this effect repeated with other attendees, as well.

So the resulting Twitter stream was decidedly biased in favor of the least-important, most self-helpy kinds of messages, while the deeper, more important insights went relatively silent.  

And I think that is the source of the skepticism and derision from those 'out-of-the-room', while those 'in-the-room' were decidedly enthusiastic about how the event played out.

***

Will the Creative Cities Summit matter to Lexington?

It is far too early to tell.  It will take time, work, and discipline to realize the vision that many of us had leaving the summit.

Should the Creative Cities Summit matter to Lexington?

Absolutely.

Seeing the innovations that other cities have applied in improving their quality of life is vital as we attempt to build a better Lexington.  We need that kind of cross-pollenation with our own innovative initiatives to ensure the best possible future for us and for our city.

For those who feel as though we need a lot less talk and a lot more action, then mark this coming Saturday 17th April on your calendar.  That is when ProgressLex is hosting the Now What, Lexington? 'unconference' at the Carnegie Center in Gratz Park.  

Now What? is explicitly geared toward generating tangible action from the ideas of the Creative Cities Summit.  Whether or not you attended Creative Cities, you should come to Now What? if you want to join with others to make Lexington better. 

Now What? will be tweeted, too.  But it will be better if you show up.  As we've seen, Twitter isn't always the most effective medium for conveying important ideas. 

It is free.  Everyone is invited.  We'll be doing things.  No excuses.

Read more of the continuing conversation about the Creative Cities Summit on Twitter with the hashtags #ccslex, #uncreatives, and #uncreativelex.  Read about the upcoming Now What, Lexington? unconference with the hashtag #nowwhatlex.  Full disclosure: Lowell's is a sponsor of Now What, Lexington?

To-Do List for Lexington: 6. Be Original

(Part of the To-Do List for Lexington series.  Click here for an overview and links to the rest of the series.)

Quick!  Think of a city you love (outside of Lexington).  Really savor that mental image.  Let your positive thoughts run for a bit. 

Got it? OK.

If you're like most folks, when you think of your favorite city, you think of one (or a combination) of a few key types of memories:

• Places.  You remember neighborhoods, buildings, parks, alleys, establishments, etc.
• History.  You remember important things that happened there.
• Products.  You remember things that they have or that they produce there.
• People.  You remember who you met and how they treated you there. 

I have the wonderful affliction of loving nearly every place I visit - but always for different reasons. 

I loved crawling through the historic back alleys (and patronizing the restaurants and bars) of Boston's North End.  I had the fortune of being there in a little Italian restaurant while Italy won the World Cup in 2006.  I remember the flags, the honking, the cheering, the flavors and smells...

I loved going to Tokyo with a couple guys I worked with in my last job, and visiting the temples at Asakusa and seeing the bewildering variety of Japanese people at the temple and at surrounding neighborhoods and markets.  In one of those inexplicable cultural moments, I remember 3 separate families awkwardly approaching me to take pictures with their sons (and giving me their sons' "business card" afterward).

I love Portland.  I love Austin.  I love Boulder.

More than anything else, I love the utter originality of those cities' places, history, products, and people.

But Lexington is the city I chose. 

::

Our city leaders often go on tours of "model cities" which Lexington might be able to learn from, including Boulder, Austin, and Madison.  In the process, they see many unique things to love about those cities. 

But too often, rather than focus on what original qualities Lexington should leverage, our leadership focuses on what those cities have that Lexington does not: "If Madison has bike trails, so should we!"  (No, I'm not opposed to bike trails; I am opposed to the mindless parroting of other cities' actions.)

Lexington must be original.

What impressions do we make on people when they visit Lexington?  What impressions do we make upon our own citizens?  What unique experiences do we create?

Here are a few which jump out at me.  I'm sure there are more I missed.  (Add your own in the comments below!)

There are the memorable places like no other - Keeneland, Ashland, Gratz Park, the UK campus, the Transy campus, Victorian Square, and the downtown pasture at CentrePointe, just to name a few.  (OK, I'm joking on the last one.)  I love the North Limestone neighborhood that Lowell's is privileged to be a part of.

There are the memorable histories of Henry Clay, Town Branch, the East End, and the Carnegie Center.

There are the memorable world's-best products - basketball, Camrys, horses, and bourbon.

There are the incredible people of our city - smart, thoughtful, hard-working, and funny.

When we're looking to influence how people - tourists, visitors, job applicants, investors, business owners, our own citizens - view our city, we need to amplify our best assets. 

And, when we are presented with the rare opportunity to leverage all four memorable assets  - original places, original history, original products, and original people - at the same time, we must jump on those opportunities.

Right now, we have such an opportunity with Lexington's Distillery District and Town Branch Trail. Many people still don't know that Lexington even has a Distillery District, so I'll offer a brief overview.  On Manchester Street, there are several old, historic, and distinctive distillery buildings and warehouses which were last used last century to make bourbon in downtown Lexington.  They used the water supply from nearby Town Branch, a stream which used to run through the center of Lexington, but is now buried under Vine Street.  Several of Lexington's best and brightest people want to transform the largely abandoned district into a vibrant neighborhood with entertainment, arts, shops, restaurants, and - for the first time in nearly a century - distilling.  Businesses are already beginning to open in the district, and one - Buster's - is an entertainment venue which is already attracting notable new talent to Lexington.  The Distillery District would also be the starting point for Kentucky's Bourbon Trail.

This afternoon (at 4 PM), Lexington's Urban County Council is voting on whether to issue $3.2 in infrastructure bonds for the Distillery District.  Issuing the bonds would not be a handout - the funds would be reimbursed through taxes on the new commerce that takes place within the District.  Also, the funds would be released incrementally - as new commerce takes place, more funds would be available for needed infrastructure improvements. 

The bonds would be used to create parts of Town Branch Trail (a greenspace and walkway along historic Town Branch), to improve pedestrian access along Manchester Street, and to look at how to improve utilities, roadways, and streetscapes along Manchester as well.  

Lexington is in a financial pinch at present, and there are many on the council who just want to "wait a while" for things to get better in the economy.  The trouble with waiting is that - often - waiting turns into permanent deferral, and projects never get done.  Unlike CentrePointe - of which I have been highly critical - the Distillery District has active businesses and active investors who are ready to utilize the improvements that this bond offers.  These businesses are poised to contribute far more than $3.2 million back to our city's coffers over the coming years.

::

Lexington has the all-too-rare opportunity to create a unique place in our city - the kind of place which ultimately would stand next to Keeneland, Gratz Park, and Ashland as one of Lexington's "signature" locations.  We should leverage our our originality - our unique and memorable places, history, products, and people - to craft a better Lexington. 

That's why we should support the Distillery District, even in difficult financial times.

Let's be original.

(This post is awfully late in getting up - If you don't have time to contact your council person prior to their 4 PM vote, please do take the time to see how they voted.  And remember that for the next election.)

Postscript: The backroom intrigue as the council vote approached.

Next: 7. Plan Well

What presenting to LFUCG is like

Prologue
It all started with a testy weekend exchange on Twitter with LFUCG council member Doug Martin.

That Twitter exchange started with me posting multiple sarcastic complaints about traffic and then morphed into a conversation on leadership. 

Throughout the day on Friday, I saw a series of 'tweets' on how bogged down Lexington's traffic had become.  As new street closures on West Main Street and Old Frankfort Pike were added to the long-term closure on South Limestone, traffic in many parts of the city came to a standstill.  This was exacerbated by a multi-vehicle wreck on Versailles Road Friday night.  Essentially, the entire west and south side of Lexington was impassable.

I then made my sarcastic assessment of the chaotic state of our streets.

Without going into details, CM Martin objected to my flippant tone, and urged me to complain less and lead more.  It was a point that he reiterated as other folks jumped into the conversation throughout the weekend.  I pulled back from the discussion - stewing a little that CM Martin felt I wasn't leading already. 

I should clarify that Doug Martin is one of my favorite council members.  He's engaged and approachable - by far the most active Twitterer in LFUCG - and he genuinely wants more citizen participation and a better city.  Although he and I frequently disagree on specific tactics that we should use as we approach the important issues in Lexington, I feel that we're on the same team. 

But as the weekend progressed I couldn't get over how he seemed to think I wasn't a leader.

::

Preparation
As I stewed about the conversation with CM Martin, I was simultaneously stewing about the state of our city's traffic.

I have written a few times about the streetscape project and the resulting impacts to downtown.   Most recently, I wrote about the "true costs" of the South Limestone project - lost customers, lost productivity, lost services - and estimated the total loss of business to be between $84 and $92 million, far in excess of the approximately $17 million being spent on construction.

Meanwhile, there seemed to be no sense of urgency at LFUCG about accelerating the project.

On Monday, I learned that the next LFUCG work session included a "Downtown Streetscape Update" on the agenda.  I decided that I would make a presentation on my findings - and perhaps demonstrate some "leadership".

Trouble is, I had never even been to council chambers, let alone participated in a meeting.  I asked my informal network of friends on Twitter, email, and South Limestone what I needed to do to make a presentation at the beginning of the session. 

And the responses I got were great, but a bit intimidating.  I only had about 24 hours to get my act together.

Citizens are only allowed 3 minutes to comment on issues on the agenda.  But other citizens can donate their time.  I figured that I had at least 10 minutes worth of material, which would mean that I needed 3 (or more) other folks to donate their time to me.  Everyone has to sign in before the 3 PM meeting starts.  Getting 3 other people to come to council chambers at 3 PM on a Tuesday is a daunting task.  

At the same time as I was searching for supporters, I was also trying to throw together a presentation.  I am a presentation perfectionist - I like to have every slide "just so", and I want to know precisely what I'm going to say with each slide.  (I'm the same way with writing, by the way.)  Normally, crafting a presentation that I am happy and comfortable with takes a week or more.

But I had one day.  Time to buckle down.

By early Tuesday, I had only one other person committed to showing up, giving me a grand total of 6 minutes.  I was beginning to think I'd have to miss this opportunity to present to council.  As I was preparing the presentation, I was also mentally noting the parts I'd have to slash if I didn't have enough supporters donating their time. 

But as my network kicked in on Tuesday afternoon, I saw that I'd have at least 12 minutes.

With that, I "locked in" the content of my presentation, and downloaded a few different versions of it to a thumb drive.  I didn't know which version of PowerPoint to bring (PP 2003 is the best bet).  I also didn't know if I'd have control of the 'clicker' to transition between slides (it turns out that I did).

::

Presentation
I showed up to city hall at about 2:45 PM, hoping to see my "supporters".  I checked in at the front desk by giving them my driver's license and getting a visitor's badge (a sticker, really).  Then, one by one, I started to see the other folks who were donating their time to my presentation.  There were 4 others, which should have given me 15 minutes - more than enough time for what I had to say.

I gave my thumb drive to the LFUCG's technical coordinator, and had a moment of panic - the thumb drive had an "autorun" file on it which the LFUCG computers saw as malware.  I was starting to look like I couldn't even load up the presentation.  After a reboot, we were able to transfer it, and the coordinator showed me the way to navigate through my presentation while up at the podium.

Mayor Newberry started the work session at 3 PM (sharp!), and public comment (for items that are on the agenda) is usually the first item.  But Tuesday was also the day that council recognized Lexington's Junior Fire Chief, and so council made time for that first.

Then, it was time for public comment.  Mayor Newberry called my name and, as I approached the podium, he mentioned that I had 12 minutes.  My mind scrambled a bit, as I tried to figure out where the other 3 minutes went.  Did someone not sign up?  Did they do so incorrectly?  Since I didn't know, and since I designed the presentation for about 10 minutes, I decided to go ahead without making a big scene.

I was atypically nervous as I approached the podium.  I'm normally a pretty confident public speaker, but I was shaking.  What was that all about? 

I've been suffering from a cold for the past few weeks, and the constant coughing has meant that I haven't been sleeping well.  On top of that, I didn't feel fully prepared - I didn't have every detail down pat.  Then, there was minute-gate.  And, finally, when my presentation showed on screen, it jumped ahead a couple of slides.

Streetscapes

View more documents from Rob Morris.

Then, I started talking.  My voice wavered a bit.  As I got a couple of slides in, I started to feel my normal presentation rhythm.  I usually flip through 6 to 10 slides per minute, and I was starting to get into the flow of the presentation.  And, yet, I was still shaking...

For the most part, the presentation flowed as I planned.  For the most part.  The least well-thought-out section (the one where I shared my Twitter conversation with CM Martin) was where I temporarily lost track.  I struggled for what seemed like an eternity, and then finally got control of the presentation again.

In the process of bungling that one section, I fear I may have given the unfortunate impression that CM Martin was some sort of "bad guy" in the South Limestone closure.  He most certainly isn't.  (Sorry, Doug.)

As I approached the end of my presentation, Mayor Newberry interrupted me.  "You have 30 seconds."  I felt like asking if I got more time because of his interruption.  But I knew that I had only 9 more rapid-fire slides, and I knew what I was going to say, so I charged ahead, wrapping up the presentation before he could interrupt again.

GTV3 Video of Presentation (My presentation starts to 6m 30s).

::

Post Mortem
As I sat down, a few of those around me quietly praised the presentation.  Mayor Newberry called the next speaker - who was actually one of my "supporters".  So I could have had 15 minutes after all.

As the council transitioned to their business, it wasn't at all clear that my presentation had any impact.  After I finished, there was no further discussion of South Lime, and no questions for me.

I knew I had some good points, but it wasn't clear that any of them had connected with the council members.  Then, several minutes after my presentation, CM Diane Lawless came by and told me how well I did.  But Diane is such a nice person that I wasn't sure her sentiments reflected the council as a whole. 

When the "Downtown Streetscape" item finally came up on the agenda, CM Lawless ripped into the way in which the South Lime portion was executed.  And then, an amazing thing happened.  One by one, previously staid council members chimed in with comments about the urgency of accelerating South Limestone.

First, CM Kevin Stinnett made a motion for getting an update on what it takes to speed things along.  Seconded (loudly) by CM Lawless, I then watched as CMs Jay McChord and Julian Beard reiterated their support for the motion.  

In the end, the presentation did connect with a large portion of the council, and - next Tuesday - the issue of jump-starting the South Limestone project is back on the docket.

GTV3 Video of Presentation (Council discussion starts at 1h 33m.  Takes a while, but it gets interesting).

The True Cost of South Limestone

The South Limestone streetscape project began with the closure of South Lime two months ago today, and the project is slated to continue for another 10 months.  Meant to better connect downtown with the University of Kentucky campus, the project includes the widening of sidewalks, the installation of bike lanes, and the underground placement of utilities.

When the project started, we wrote about the chaotic process of closing the street and about the need for practical planning and design on South Lime and other urban development projects.  How has the project evolved since then?

Not well.

Severed Artery
The closure dramatically impacted traffic patterns between downtown Lexington and the south side of our city, resulting in gnarled traffic on a number of alternative routes to downtown.  At various points in the project, intersections with cross-streets (High, Maxwell, and Euclid) have also closed with little notice, adding to confusion and gridlock for downtown commuters and shoppers.  In effect, the closure of South Limestone has walled off downtown from Lexington's south side.

Several businesses along South Lime have struggled to cope with the substantial loss of customers and the physical disruption of their businesses.  Last week, Joe Graviss, the owner of the McDonald's on South Lime, pleaded with Lexington's Mayor and Urban County Council to add extra shifts or more workers to speed the project.  

City officials responded that extra shifts will not accelerate the project.  The project's manager noted that the city's concrete supplier closed in the evenings and that local utilities were already providing personnel to assist with the location and relocation of utility lines.  At one point, he admitted that he had no ideas for speeding the South Lime project along.

Vice Mayor Jim Gray - the CEO of Gray Construction and the only councilmember to oppose the project - countered the project manager's claims.  "It would be wise of us not to be extravagant in describing the difficulties of this project...  With 2000 projects under my belt, I've never seen a project that couldn't be improved or accelerated."

At this point, most elected leaders and city bureaucrats seem unprepared to take significant action to accelerate the South Limestone streetscape project.

That's because they have been thinking about the impacts of South Lime on the wrong scale.

Estimates on the price of the South Lime project vary, but the early $5.2 million estimate has ballooned to somewhere between $13.1 and $17 million.  The newer, higher price was partly meant to help expedite the project. 

But, as we'll see in a moment, that price far underestimates the true cost of the project to our city, our economy, and to our future. 

South Limestone's closure is not a mere inconvenience - it is a severed artery that is bleeding the life from downtown.  It demands an urgent response from our leaders.  The cost to the city is too dear to delay action, especially in this difficult economy.

Disruption: Anecdotes and Hard Data
A number of weeks ago, on the first day that the High Street intersection with South Lime was closed, I worked in my office and overheard two different customers from the south side of Lexington talk about the enormous problem of getting to our downtown shop - the confusion from suddenly closing the High Street intersection had made traffic especially difficult to decipher.

Then, we had an elderly customer from Nicholasville make an appointment for the next day, asking for directions on how to get to the shop with all of the construction.  Concerned about getting lost, she decided to do a dry run the day before.  After experiencing the jams, diversions, and delays, she called back and canceled her appointment.

Last month, I talked with another downtown business who is in our same industry.  They were scratching their heads about why their August business "fell off a cliff".  I talked with them again last week, and their business was still much slower than usual.

Yesterday, a regular customer who owns a shop in Festival Market came into Lowell's and opened the discussion with a flat "Business sucks".

When I started hearing these anecdotes, I began to think that the impacts of the South Limestone closure extended far beyond South Lime.  I wondered about the effects of South Lime as a customer deterrent for our business:

• How many of our customers come from the south side of Lexington?
• How many of those south-siders might have chosen to stay away from "the mess" downtown?
• What could that data tell us about the impacts to all of downtown Lexington?

And what I saw in the data was astounding and troubling:

• About 30% of our customers come from ZIP codes which would use Nicholasville Road (which turns into South Limestone) as the primary corridor to downtown
• Since July 22nd - the date of the closure - we have lost one third of the business we'd normally expect from those ZIP codes.  By comparison, the rest of Lexington is relatively flat or growing.
• The net of this was a loss of 10% of our sales (and a much bigger hit to our profitability) directly attributable to the South Lime closure.

I disclose these facts not as a woe-are-we pity party, but as a fact-based assessment of how "the mess downtown" affects one downtown business.  Our business is a relatively healthy, well-respected business with incredibly loyal customers (Last week, we won "Best Honest Mechanic" from Ace Weekly readers).  And, still, the closure of South Limestone accounted for a loss of a full third of south-side customers.

Ripple Effects
Can we extrapolate from just one business to the whole of downtown?  Not with any degree of certainty.  But my conversations with other business owners make me believe that my business' experience with the South Lime closure is not exceptional.  Admittedly, not every downtown business is as impacted by traffic disruptions, but most are impacted in some fashion: lost customers, lost productivity, supply chain delays, etc.

Hard data for downtown Lexington is difficult to come by.

• Just how much of Lexington's $11 billion economy takes place downtown?
• Which businesses depend upon the smooth flow of traffic?  To what degree?
• How many of their customers / employees / suppliers come from the south side?

Depending on the assumptions used, the estimate of impacts to downtown can vary wildly.  Our best "conservative" estimate?  Downtown Lexington loses about $360,000 each business day that South Limestone is closed.  (Depending on our assumptions, the estimates ranged between $275,000 and $600,000 each day.)

That translates to between $7.0 to $7.7 million in lost business every month, or between $84 and $92 million for the year-long duration of the South Limestone project.  That's around 700 to 1000 jobs which could evaporate from downtown Lexington, especially as the closure drags on.

Are these numbers absolute?  Not by any means.  But they do provide a ballpark idea of the true cost of the South Limestone project. 

Much of the focus on the costs of South Lime have focused on either a) the direct taxpayer costs ($17 million) or b) the costs to businesses on South Lime.  And while those South Limestone businesses deserve special attention for the degree this project impacts them, our estimates suggest that our leaders and our community have been thinking about 'cost' on the wrong scale.  There is a much bigger, much more urgent cost which must be addressed.

The irony of South Limestone - as the cycle of lost customers, declining businesses, lower employment, and more lost customers continues - is that the project may well end up strangling the very downtown that the streetscape is meant to connect with.

Our leaders frequently assert the necessity of a vibrant, livable downtown.  It is time for them to live up to their words. 

With the South Limestone closure, they must now choose: Will they continue to choke off downtown from a significant portion of the city, or will they act with urgency and extraordinary effort to accelerate and improve the project?

Their actions now will determine whether the prediction from our Chaos post will come true:

"And the results of the chaos are easy to predict.  Confused commuters and shoppers stay away from 'the mess' downtown.  Downtown businesses die.  And, after fits and starts, Lexington ends up with a beautiful street.  To nowhere."

Time to choose.

The Spotlight Effect

There's an old saw in business: "That which gets measured gets results". 

I have to admit I've always been a bit dismissive of that saying (usually attributed to the late business guru Peter Drucker).  In corporate life, I saw plenty of things that were measured which didn't get results.  The mere act of measuring something accomplishes nothing if effort doesn't also go into improving that 'something'.

But a couple of events over the past few weeks has me thinking about what does get results. 

Newtown Pike Extension
The first event was the much-acclaimed burial of utility lines along Lexington's Newtown Pike extension.  After Graham and Clive Pohl (of Pohl Rosa Pohl Architects) highlighted the discrepancy between the pretty artists' renderings of the extension and the actual plans for the construction that was about to begin.  Instead of the beautiful, pristine streets promised in the renderings, the extension would have been littered with utility poles and power lines.

LFUCG engineers cited the high relative cost of burying the utilities, estimating that putting them underground would add nearly $900,000 to the project's cost.

Since the extension will be a kind of "gateway" into Lexington, there was an outcry from many on the Urban County Council about how important it was for us to look good for visitors.  Our Vice Mayor was quoted as saying "We'll never get a second chance to make a first impression."  Local columnists and Lexington's online community jumped on the issue as well, and it snowballed.

Within a couple of weeks, city leaders lined up with Kentucky's Governor to announce that they had found the extra funds to put the utilities underground in the Governor's contingency fund.

I have to admit, I support putting utilities underground, but am dubious of the "first impression" argument.  The utilities are currently slated to go underground only on the Newtown Pike Extension.  The existing stretch of Newtown will still have above-ground utilities.  So a visitor's true first impression will still be filled with wires and poles from I-75 to Main Street, as seen in this shot of Newtown from this afternoon.

The Treeds Experiment
The second event was a little closer to home.  In the Treeds Experiment, I decided take up a challenge from an Urban County Councilmember to see how long it took to get a response from LFUCG's Division of Code Enforcement.  So, last Friday - just before the holiday weekend - I sent an email to Code Enforcement about a lot next to our main building which had become overgrown with tree-weeds, or "treeds".  

At the same time I sent the email, I posted an outline of the experiment on my blog, along with pictures of the overgrowth.  And I pledged to chronicle the responses I got from the city. 

This past Tuesday, the city's contractors showed up to clear the lot - less than one business day after my email and post.  Pretty impressive by any measure.  Code Enforcement hasn't addressed all of the concerns I outlined (the main drain in the lot is still clogged).  But, to be fair, they have addressed most of the public safety issues which accompanied the blight in that lot.

On Twitter, a couple of folks brought up valid points.  Russell and Ann both pointed out that Treeds had an unfair advantage - because I talked about it publicly, that may have helped artificially accelerate the responsiveness of the city.  (Indeed, within hours of my initial Treeds post, a city employee commented that the experiment would 'fail'.)

The Spotlight Effect
These two events both benefited from the "spotlight effect": When the public's spotlight turns to a particular issue, and that spotlight begins burning intensely, 'normal' reactions and 'normal' timelines are no longer acceptable.

Russell and Ann were right: my experiment wasn't 'normal', and the average citizen shouldn't expect that kind of responsiveness.

And others would point out that the Newtown Pike Extension wasn't 'normal' either - it was a one-time event which utilized one-time funds.  We shouldn't expect city officials to move that quickly to fix an oversight or mistake.

But we should. 

Everyone should get prompt action on valid complaints.  Everyone should expect city leaders to fix their mistakes, to do the right things, and to do them quickly.

But we can't wait for our leaders to do the right thing.  We need to push them.  We need to build bigger, brighter spotlights, and we need to shine those spotlights on the things that matter. 

It is up to us.

Building a Spotlight
What does it take to build an effective spotlight?  I can't claim to be an expert, but here are some of my thoughts culled from the past few days and weeks (feel free to contribute your own in the comments below):

• We must be more vocal.  We tend to be indirect folks here in Lexington.  It is awkward and impolite to complain; it is much better for the other person to do what they should.  But they don't.  And we stew.  And nothing much changes.  

It is time for that to change.  As out-of-character as it may be for many of us, we need to become much more vocal about what is wrong and what we expect.  Only then can things improve.

• We must join our voices.  When one person calls a city department, they are a complainer.  When several people call - and are joined by bloggers, columnists, and media - that's a movement. 

And a movement is what dislodged the status quo of the Newtown Pike Extension.  We need more movements in Lexington with more voices working in concert.  We need to utilize our public platforms - Twitter, Facebook, blogs, and papers - to draw others to our cause.

• We must be more visible.  When one person calls one other person at LFUCG, there's no spotlight.  No one else knows about the call, and no one else can amplify the sentiments expressed there. 

One of the reasons that Treeds got such a rapid response was probably the 'publicness' of the experiment.  That visibility helped the amplify the spotlight and, in all likelihood, accelerated the response.

• We must measure.  This statement isn't about micro-measuring every detail of every issue.  It is about documenting who we talked with and what they said, and holding them accountable for their actions (or lack thereof). 

Any regular reader of my posts knows that I'm not shy.  They know that I'm not afraid to use my platforms to try to build a movement.  In the past few months, my blogging and writing has become fairly visible.  (And, for what it is worth, I've got some like-minded friends.) 

So if you need a spotlight, let me help you.  If you see blight around campus or around downtown, let me know.  If your business is suffering from the South Limestone road closure, let me know.  If you have a great idea for our city, let me know.  If you see a problem which needs fixing, let me know.

Together, let's be more vocal.  Let's join our voices with others who agree.  Let's be more visible.  And, then, let's hold people accountable.

I want a better Lexington.  One where businesses aren't squeezed out of their locations by poorly-planned year-long road closures.  One where our government operates much more transparently.  One where blight is quickly and effectively addressed.  One which has a real (and realistic) urban development plan for downtown.  One which has a thriving arts and business community.  One which leverages its past to build a brighter future.  One which will make my son homesick if he ever leaves.

If you want that too, then join me - or rather, have me join you.  Tell me what matters. 

And I'll do my best to help you build a spotlight.  Let's make a better, faster Lexington.

The Treeds Experiment

Back in May, I blogged about the abandoned properties next to our shop, and about what to do about blight in our city. 

In this week's Urban County Council meetings, residents of several neighborhoods surrounding the University of Kentucky campus registered their concerns about the changes taking place in their communities. 

The biggest concerns surrounded how some property owners were effectively converting single-family homes into makeshift dormitories / frat houses / flop houses to take advantage of the burgeoning student population at UK.  The complaints centered not only on the creation of multi-unit apartments and the paving of lawns for parking, but also on the often-destructive behavior of the residents who move in.

Some on the council wished to impose a moratorium on these kinds of conversions while the city figures out how to accommodate growth at UK. 

Last night, the council rejected the proposed moratorium, to the disappointment of many of the residents.  At one point, Councilmember Lane suggested that neighbors should simply "file a complaint on property owners you feel are in violation of zoning ordinance, see if our government can apply the laws we have on the books," to which citizen Janet Cowan responded "I know all of the numbers, Mr. Lane.  I have them on speed dial." 

So, how well can the government apply the laws we have on the books?  It is time to see. 

The Treeds Experiment
What happened after openly blogging about the properties surrounding Lowell's back in May? 

Nothing.

Well, not nothing, exactly..  The 8-foot tall tree-weeds ("treeds") I talked about then have now grown to some 16- to 18-feet tall, dwarfing the hedges that they have grown through.

The treeds now spill out over the sidewalks, making them impossible to navigate without a machete.  Some pedestrians step into the street rather than navigate the mess on the sidewalks.

The grass growing next to our building has now grown to 7 1/2 feet tall (That's me back there earlier this afternoon, risking chiggers and other man-eating varmints. I'm 6 1/2 feet tall...). 

And, finally, the only drain on the lot is completely crusted over.  So, during heavy rains, the lot drains straight into Mechanic Street, contributing to an occasional "Lake Mechanic".

All of which sets the stage for what I'm calling "The Treeds Experiment".  The Treeds Experiment is a test -- wherein I plan to take up Councilmember Lane's suggestion -- and learn just how long and how well our government takes to apply the laws that we already have on the books.

Simultaneous with this blog post on the afternoon before a holiday weekend, I am sending an email to [email protected] requesting that they take remedial action upon this lot and its owners.

I will chronicle the communication (and, I anticipate, the non-communication) I get from the Code Enforcement folks and other city officials in updates to this post and on Twitter.  I will not tell them that I am doing so (so that they will not artificially accelerate their actions).

But I am telling you.

Should be interesting.  Look for updates here as the weeks and months progress.

::

Note: Many thanks to AceWeekly for chronicling the LFUCG meetings and civic discussions.  Ace captured the quotes I used above.

Pat Gerhard at Third Street Stuff has recently contacted the Downtown Development Authority about the lot.  We agreed a month or so ago that I would contact Code Enforcement.  (Sorry for the delay, Pat.)

9/4/2009, 3:46 PM: Sent initial email to LFUCG Code Enforcement, while publishing this post.

To whom it may concern:

I am the owner of Lowell's, an auto repair shop at 111 Mechanic Street.  There is a lot at the North corner of North Limestone and Mechanic which appears to be abandoned, as no maintenance has been done by the owners for over 2 years. 

There are now large tree-weeds growing through the hedges surrounding the lot, making progress on sidewalks very difficult.  The only drain on the lot is clogged, and the lot drains into Mechanic Street, contributing to flooding during heavy rains.  There is a large clump of grass which is now approaching 8 feet in height which is growing next to our main building.  Many customers assume that the lot is ours (since it borders our building), and a few have asked us to clean it up.

Can you take remedial action on this property and update me on your progress in addressing these issues? 

Thank you,
Rob Morris

9/4/2009, 6:18 PM: Blog comment from the Lexington Streetweeper (written by an LFUCG employee) on how the Treeds Experiment is "destined to fail".

9/4/2009, 9:28 PM: I reply that failure really isn't possible.

9/7/2009, 10:50 AM: During torrential downpours, Lake Mechanic forms again as Mechanic Street is completely flooded, due in part to runoff from the Treeds lot with a clogged drain.

9/8/2009, 10:45 AM: I receive an email from David Jarvis, Director of Code Enforcement:

I will have Calvin Powell assign an Inspector.  Thank You.

9/8/2009, 1:25 PM: I respond:

Thank you.  I look forward to your updates.

Rob

9/8/2009, 2:19 PM: David Jarvis sends me another email:

Property will be cited (14 day time limit) and the limbs will be cleared back off the sidewalk as soon as we can get our contractor there.

As I read that email (and post this update) the contractors arrive with weed-eaters and loppers in hand:

 

Buh-bye treeds!  But where will the varmints live now?

9/8/2009, 2:45 PM: Taylor Shelton and 10th District Councilmember Doug Martin post responses on the blog.  Councilmember Martin mentions that Code Enforcement is particularly short-handed and suggests that citizens use LexCall 311 with details of their similar complaints.

9/8/2009, 6:31 PM: I came back to Lowell's after being out since about 3:30 PM, and most of the debris was removed.  Still a couple of piles which couldn't fit into the contractor's truck.

9/9/2009, 9:15 AM: Contractors cleaning up remaining debris from lot next to Lowell's main building.

 

9/9/2009, 10:14 AM: The lot's only drain is still clogged.  Not sure whether that is a Code Enforcement issue or not.  Sent a response to David Jarvis and Calvin Powell:

Thank you for your quick actions in getting this lot cleared. 

Is the clogged drain in the lot something under the purview of Code Enforcement, or would there be another department which handles that drainage issue?

Thanks,
Rob

LexMob: Final Schedule

When we started LexMob on July 22nd, the idea was to keep patronizing businesses affected by the closure of South Limestone for a month. It has been extremely rewarding to meet fellow LexMobbers and to meet owners and workers in the targeted businesses.

It has also been very time-consuming.  I've decided to stop organizing LexMobs after Monday, August 31st, so that I can better tend to my business.

This doesn't mean that LexMobs have to stop.  In fact, we'd be thrilled if LexMob continues into the fall.  And anyone can organize a LexMob for South Limestone: The idea is to 'show up' with our feet and our wallets to help out these businesses.  Whether it is a mob of 1 or a mob of 100, simply show up and ask others to show up as well.

The easiest way to organize a LexMob: Send out a notice on Twitter with the hashtag phrase "#LexMob for #SoLime".  In my experience, it is good to send out a few tweets at different times of the morning to let different people know when and where the LexMob will be.  Then, after your LexMob, tell the twitterverse how it was and thank those who came.  That's all it takes. 

I've had a number of suggestions for how LexMob could continue:

• LexMobs could be weekly (or a couple of times a week) instead of each day
• Perhaps the businesses on South Limestone could organize LexMobs themselves
• We could just see what happens; Hopefully, other LexMobbers could continue to organize mobs without a central planner

We support any or all of these options. 

In any case, here is our 'final' schedule for LexMob:

• Wednesday 8/19, Lunch: Sav's Grill
• Thursday 8/20, Lunch: Hanna's, Zag's, & Failte Irish Imports
• Thursday 8/20, 7 PM: Social Event at Pazzo's Pizza Pub (sponsored by the Lexington Fashion Collaborative)

• Monday 8/24, Lunch: Banana Leaf
• Tuesday 8/25, Lunch: Tolly Ho
• Wednesday 8/26, Lunch: Cloud 9
• Thursday 8/27, Lunch: Han Woo Ri, The Album, Sqecial Media, and ReBelle
• Friday 8/28, Lunch: Sav's Grill and Oneness

• Monday 8/31, Lunch: Pazzo's Pizza Pub and CD Central

We hope to see you there!  Who's in?

LexMob Schedule

We like (and encourage) the loose, spontaneous organization of LexMob (an initiative to patronize businesses affected by the closure of South Limestone). 

But several folks have encouraged us to put together a LexMob schedule so that they can plan their attendance.  We think that's a good idea.  As always, feel free to organize or propose your own LexMobs.

Here's our tentative schedule for the next week (also published in this week's Ace Weekly on page 5).  Look for updates and schedule changes on Twitter (look for the #LexMob or #SoLime hashtags).

Friday 8/7, Lunch: Tolly Ho
Friday 8/7, 5:30PM: (OFF Lime) Front Porch Friday, Ace Weekly, 185 Jefferson
Saturday 8/8, 6-9 South Limestone 'Street Party' near High Street

Monday 8/10, Lunch: Banana Leaf
Tuesday 8/11, Lunch: Hanna's, Zag's, & Failte Irish Imports
Tuesday 8/11, Dinner: SoundBar
Wednesday 8/12, Lunch: Sav's Grill and Oneness
Thursday 8/13, Lunch: Cloud 9 and Kennedy's Bookstore
Friday 8/14, Lunch: Tin Roof

Please join us as we support businesses on South Limestone.  Also, if you are up for a hike (7 to 8 blocks) you can park in the Lowell's parking lot on the south corner of North Limestone and Mechanic Streets.

LexMob Update: Who's in?

It's been two weeks since South Limestone closed and since I suggested the idea to LexMob businesses up and down SoLime.  So how is the LexMob idea faring?  Have we made a huge difference to the bottom lines of the affected businesses?

In a word: No.

In two words: Not yet.

As an ad hoc effort, we usually decide the spot we'll mob for lunch that morning.  I usually send out a tweet proposing a time and place, and ask "Who's in?" 

So far in a typical LexMob, just three or four people show up.  A couple of times, the mob swelled to about a dozen or more.  And yesterday, I was the lone LexMobber.

These weren't really the overwhelming numbers I had hoped for, but are about what I expected as we get the idea of LexMob off the ground. 

Still, the LexMob experience has already been rewarding in a number of ways:

• I have gotten to meet a lot of great new people while LexMobbing.
• I have gotten a lot of exercise marching up and down Limestone (except in yesterday's monsoon).
• I have gotten a lot of encouragement from the local Twitter community and from the affected businesses.
• Lexmobbers (including me) have gotten exposure to great restaurants and stores that we would never have patronized if the closure hadn't happened.
• A few times, I've seen folks organize their own LexMobs
• I have gotten an inspiring, up-close look at how resilient and innovative other business owners are in the face of profound challenges.

And those rewards will keep me going back to SoLime businesses during the closure.

Where have we been?  Here's our list so far:

7/22, Lunch: Pazzo's Pizza Pub (4 LexMobbers)
7/23, Lunch: Sav's West African Grill (3 LexMobbers)
7/24, Lunch: Tolly Ho (14 LexMobbers)

7/27, Lunch: Tin Roof (3 LexMobbers)
7/28, Lunch: Han Woo Ri (Korean - 11 LexMobbers)
7/29, Lunch: Hanna's on Lime and Failte Irish Imports (8 LexMobbers)
7/29, Dinner: Pint Night at Pazzo's Pizza Pub (~4 LexMobbers)
7/30, Lunch: Pita Pit (2 LexMobbers)
7/31, Lunch: Sav's West African Grill (4 LexMobbers)

8/3, Lunch: Banana Leaf (Indian & Malaysian - 2 LexMobbers)
8/4, Lunch: Cloud 9 (1 LexMobber)

While I think all of these businesses need our help, I worry less about the popular campus hangouts (Pazzo's, Tolly Ho, Tin Roof) than I do the lesser-known and more out-of-the-way spots.

At Cloud 9 yesterday, I wasn't just the only LexMobber there - I was the only patron.  During what should have been their busiest hour, I was the only customer in the whole place. 

And - given its former 'dive' incarnation as the original Tolly-Ho and Wok 'n' Go (tucked behind Kennedy's Book Store) - it was a surprisingly great place.  Very clean.  Really nice ambience.  A very tasty special burger blend from Critchfield Meats.  Deep-fried hot dogs.  Beer-battered fries.  Unique and delicious 'flavor-blasted' soft serve ice cream.  Home-made mix-ins for ice cream treats.  Home-made frozen cheesecake.  I already want to go back.

Being the only customer gave me a chance to have a long conversation with the owner (Kurt Henning) about a variety of topics, including the South Lime closure.  He had no communication from the city about the closure - he heard details mainly through rumor.  He didn't know that the digging would go as far south on South Lime as it has.  He had no warning that the Euclid / Winslow / Avenue of Champions intersection with South Limestone would be completely closed.  And, he was surprised that the road in front of his shop (on Winslow, well off of South Lime) was being dug up as well.

And yet, Kurt was surprisingly resilient in the face of such a disruptive interruption to his business.  He's looking forward to when students get back on campus and business picks back up.  He's working to ensure good word-of-mouth (he does no advertising) about his business. 

And, sitting there as the only lunchtime customer in a great local establishment, I decided then and there to give him some good word-of-mouth.  (Did it work?) 

Don't go there - or to other South Lime places - because you feel sorry for them.  Go because they really are that good and because they deserve our business.

And, despite the extra inconvenience, time, and cost - I decided to continue LexMobbing South Limestone.

Who's in?

Pretty to Gritty: Thoughts on Lexington Streetscapes

Last week, Lexington's Downtown Development Authority held a "Downtown Improvements Public Forum" to share plans for renovating streetscapes along Limestone, Cheapside, Vine, and Main Streets.  (Controversial renovations on South Limestone are already underway.)  More 'open house' than 'forum', the lead agency for DDA's plans, Kinzelman Kline Gossman, had ringed the room with posters showing artists' renderings of what the streetscapes would look like and detailing guidelines for street and sidewalk construction. (Large PDF of the DDA streetscape plan here.)

Walking through the door, there was a telling moment.  There was an artist's rendering of what South Limestone would look like after the streetscape project was finished.  It was beautiful.  Except that it wasn't South Limestone.  The lone rendering of a South Limestone streetscape, while pretty, included non-existent buildings and storefronts.

Throughout my career, I've had the opportunity to manage relationships and to interact with numerous creative agencies: design firms, ad agencies, industrial designers, consultants, and the like.  I've had many opportunities to witness their creative processes at work.  I've also seen the common pitfalls of such creativity.  And Wednesday's open house struck a familiar chord. 

One of the most common pitfalls of creative work is to focus disproportionately on 'the pretty'.  'Pretty' is creative work in its purest, most idealistic form.  Pretty designs are often, as their name would imply, beautiful and inspiring.  And as long as inspiration is their primary goal, pretty designs can be useful.

But too often, pretty designs are seen as some kind of end point in the creative work.  After producing a a creative product, the agency - or, worse, their clients - see the work as complete.  They frequently choose not to get 'dirty' with the unglamorous implementation of the project.  Many design firms see implementation as too mundane, too pedestrian.  In their view, they should focus on the pure 'art' of their creativity; it is then up to the engineer, the website coder, or the construction foreman to do the arduous task of making the project match the pretty design.

And that is precisely the problem with pretty designs.

When the pretty design meets schedule constraints or cost constraints or other real-world constraints, it can fall apart.  When the engineer or construction worker runs up against physical realities, the pretty design often gets severely compromised, and becomes something considerably less pretty.

While pretty creativity gets accolades and awards, it usually only accounts for a small fraction (I'd guess 5 to 10%, based on my experience) of the real creative work on a project.  And that real creative work is what I would characterize as 'gritty' creativity: the practical, streetwise, action-oriented creativity which actually drives the project forward and finds creative solutions to real-world problems.  The success or failure of complex projects depends in great measure on how much 'gritty' creativity is employed within those projects.

The disconnect between pretty and gritty is the most common cause of failure in creative projects.

What I saw at the DDA's forum was an abundance of stylistic and architectural details.  They had detailed guidelines for how to design intersections and sidewalks.  They had beautiful renderings of what downtown streets could look like after the designs were applied.  They had very pretty designs for the future of our downtown.

But what was missing from the forum was any substantial gritty design work for the actual execution of the project.

In the wake of the uncoordinated and under-publicized closure of South Limestone for streetscape improvements, I - and many others in attendance - expected many more practical, gritty details about how the rest of 'Phase I' (Cheapside, Vine, and Main Streets) would be implemented.  Indeed, I had also hoped to find out more about how future phases would affect my business and those of my neighbors on North Limestone. 

The disconnect between ideal ("the pretty") and implementation ("the gritty") was troubling: Could we be headed for another South Limestone? 

In the South Limestone closure, many businesses seemed to have little time to prepare for losing a big chunk of customers for a year or more.  Commuters had little time to adapt to drastically altered traffic patterns.  While the city made some public parking available, that parking was a pedestrian-unfriendly 4 to 5 blocks away from some of the affected businesses.  In short, South Limestone needed some gritty design for the implementation and coordination of the project.

The pretty planning for downtown streetscapes has been underway for years.  But real-world work on Main, Vine, and Cheapside is slated to begin in just 3 to 4 months.  This short timeframe creates added urgency for understanding how the rest of the streetscape project will really work.  And the utter lack of gritty planning details in last week's meeting makes answers to the following questions even more important.

• Could all three streets, as with South Limestone, be completely closed?
• Which sections of which streets will be closed?  For what periods?  What is the planned sequence of closures?
• When can each business on the affected streets expect their businesses to be interrupted?
• How long will such business interruptions last?  What will those interruptions look like?  Where will they be most severe?
• How can we accelerate the project where business interruptions will be most profound?
• Can we sequence closures around business cycles?  Could retailers be least affected during the holiday shopping season?  Could work near outdoor cafés be completed by spring?
• How will the city or DDA assist businesses during the closures?  How will such assistance be more effective than what was done for South Limestone?  Targeted ad campaigns?  Special events?  Shuttle services from parking garages? 
• Will drivers need to find alternate routes (as with South Limestone)?
• What are the likely sources of project delay?  How will those be mitigated?
• What, precisely, are the future phases?  When are they slated?

To avoid the chaos that accompanied the South Limestone closure, the DDA and the city must begin mapping out the gritty planning of how this project gets executed.  And simply throwing such vital details to a construction contractor isn't acceptable. 

The streetscape project is certainly a pretty design.  But, if it is to be a successful urban development project - if it is to help us build a better, more vibrant city - then it must get much more gritty as well.

Chaos: South Limestone Closure Lawsuit Details

When we initiated LexMobs to help businesses on South Limestone on Wednesday, we noted that the closure of the street seemed hasty and poorly-planned.  Well, now we've obtained the Fayette Circuit Court filing from a lawsuit intended to stop the work on South Limestone (first reported by Jake at Page One Kentucky).

And that filing reveals just how chaotic the closure process actually was.

Filed by the owners of several businesses and properties lining the route, the lawsuit seeks an immediate injunction to halt the roadwork and to reopen South Limestone to traffic.  It also seeks damages for the interruptions to business operations along the street.  The suit names the Mayor, LFUCG Urban County Council, and ATS Construction (the firm contracted to renovate SoLime) as defendants. 

And the filing tells a story of a poorly-communicated, hastily-assembled, highly-inconsistent project with an escalating price tag:

• Communication.  Initial letters from the LFUCG Public Works Commissioner to the affected businesses invited them to a open house to discuss "a streetscape design" and "utility needs", but didn't indicate a complete road closure was immanent. The actual details of the project (and of the changes to the project) were usually disclosed to owners through rumors or media accounts.
• Timing.  Owners had six days' notice before the first open house (May 18th), and there was no mention of a road closure.  A second "utility needs" meeting was held on June 3rd, and the full closure of South Limestone was disclosed.  But some owners didn't learn of the possibility of closing SoLime until the day before; The letter announcing that meeting didn't mention closing the street.
• Consistency.  In June 3rd discussions, South Limestone was to be closed from Euclid to High.  After voicing opposition, property owners were told on July 10th that SoLime would initially be closed from Euclid to Maxwell, opening up a full block between Maxwell and High Streets.  On July 21st - the day before the project began - owners learned from media accounts that SoLime was now to be closed all the way to High Street again.  That day, owners met with the Mayor and others from LFUCG to learn that ATS and LFUCG won't know what they're dealing with until they dig up the street.
• Price.  The "Downtown Streetscape Master Plan" proposed improvements to South Limestone costing more than $5.2 million.  The LFUCG council approved the streetscape plan in August 2008.  On July 7th, 2009, the council approved the $13.1 million contract with ATS.  Two weeks later, media accounts put the total at $17 million.

The patterns emerging from this (admittedly one-sided) account of the closure of South Limestone parallels with what we've seen recently from LFUCG on urban development projects:

• Projects languish for years, then are suddenly initiated.
• Decisionmakers seem to have little sense of the full scope or true impacts of their decisions.
• The true impacts of the project are only understood, if ever, after it is long underway.
• Communication with citizens is unclear, intermittent, and/or non-existent.
• The project changes direction suddenly.
• It is unclear who is accountable for the success or failure of such projects
• Because they are so committed to the (frequently noble) idea of the project, decisionmakers accept a series of concessions which cause the project's price to balloon to multiples of original estimates.

We've seen some or all of these elements in numerous recent urban development projects: CentrePointe, Tax Increment Financing (TIF), the Lyric Theatre, the Newtown Pike extension and, now, the South Limestone Streetscape.  

What results is chaos.

Business owners on South Limestone had 2 months to prepare to lose customers for 12 months.  Many owners had one day to figure out how to get customers and suppliers to their door.  The cost of the project is 3 times what was initially approved. 

And the results of the chaos are easy to predict.  Confused commuters and shoppers stay away from "the mess" downtown.  Downtown businesses die.  And, after fits and starts, Lexington ends up with a beautiful street.  To nowhere.

Chaos is no way to run a business.  And chaos is no way to run the business of our city.