Downtown Reborn


Downtown Gainesville, Fla.

Rob C. Witzel / Staff photographer
Published: Friday, March 29, 2013 at 1:04 p.m.
Last Modified: Tuesday, April 30, 2013 at 2:22 p.m.

So how did downtown, the beating heart of Gainesville in its earliest years, find its energy again?

“This has been a collection of people and a collection of projects and a length of time that fits into the puzzle of making all of this work,” says Anthony Lyons, director of the Community Redevelopment Agency, which oversees a variety of projects downtown. “What people are seeing now is that all the dots are starting to connect.”

Some of the pieces of this particular puzzle began snapping together some 30 years ago and have continued to do so:

The Hippodrome Theatre renovated and moved into the stately federal building on Southeast Second Place, drawing patrons downtown, soon followed by other artists. Developers Ken and Linda McGurn began investing in downtown properties, culminating with Union Street Station. In 1991, the Alachua County Library District opened its new $11 million, 78,000 square foot library building and headquarters on East University Avenue. Also in the 1990s, the nearby Southeast Historic District began to see some of its impressive Victorian homes transformed into popular B&Bs, turning the area into a center for these inns.

In recent years, downtown's revitalization appears to have reached some level of critical mass: In August 2009, the South Carolina-based developer Windsor/Aughtry Co. opened a 124-room, six-story Hampton Inn. The success of tech companies such as Grooveshark and Trendy Entertainment has lured other tech startups — more than 20 in all with more than 220 employees — to fill space above restaurants and retailers.

New restaurants, bars and other businesses appear to be drawing more people.

Add that to the longtime base provided by government offices that include City Hall, the county government building, two courthouses, a federal building and other satellite offices.

Long helping fuel the regrowth are the tax incentives available from the city for anyone willing to take a chance.

Among the incentives are tax increment financing — or rebates on taxes for increased property values — within the Downtown Redevelopment Area, with millions of dollars going to development projects since the area was established in 1981, including Union Street Station, Jefferson on 2nd (now the 2nd Avenue Centre), The Palms, Arlington Square, the Commerce Building and the Hampton Inn.

Since the beginning of 2006, the CRA has spent $17.2 million downtown, including development projects, lighting, bike racks, streetscaping, grants to businesses, signage and landscape maintenance.

According to the CRA, property values within the original downtown redevelopment area are nearly six times what they were when the area was established in 1980, from $18.8 million to $128 million in 2012. The area expanded in 2001 and property values rose 50 percent in the expanded area between 2006 when it was $128.7 million, to 2012 at $193.4 million.

And several new developments in the works that would bring more office space and housing — and hence, customers — in and around downtown point to its continued emergence as a center of activity in the Gainesville community once again.

On the rebound

Among the changes over the decades, several seminal developments stand out. One came in 1978, when young real estate investors Ken and Linda McGurn bought their first building downtown on the west side of South Main Street in the building now partially occupied by Rockey's Dueling Piano Bar. From there they would go on to renovate and repurpose the old Florida Theater on West University Avenue and the old Opera House building that today includes Harry's Seafood, among other buildings. After the New York Times Company donated the the old Gainesville Sun building to the city for $1, the McGurns redeveloped it as the Sun Center East in 1986, followed by the opening of Sun Center West a year later. The couple built the five-story Star parking garage, as well. (See related story, page 60)

The McGurns also brought more of a residential presence needed to sustain retail with the development of Arlington Square apartments east of the Sun Center starting in 1986, now owned by Paradigm Properties. That was followed in 2004 by the Regents Park condos north of University Avenue, built by Mike Warren of AMJ Inc. Warren would also build the adjacent three-story Commerce Building fronting University Avenue.

And in 2000, the McGurns opened Union Street Station, a five-story, balconied brick-and-glass New Orleans-style structure with ground floor restaurants and retail, second floor office space and 50 condominiums on upper floors.

Ken McGurn says that with 300,000 square feet of empty space downtown when they started, there were good deals to be had.

“We looked around and said, ‘There's potential here. The infrastructure's here. We can see the potential but it's a long-term situation. What can we do to jump start this thing?' And that's what we put together,” McGurn says.

Longtime downtown landlord and restaurant owner Billy Scheel describes downtown's comeback as a long, gradual process with each successful business luring the next.

Without Lillian's, he says, Harry's wouldn't have come. Without Harry's, there would have been no Fat Tuesdays (now the site of Half Cork'd). Fat Tuesdays led to Hooter's, formerly in the Union Street Station, which he believes drew Starbucks. And without Union Street Station, Hampton Inn probably would not have opened in 2009, he says.

Cultural comeback

In 1978, the Hippodrome theater troupe, then operating out of a warehouse, received a $175,000 grant — with an 80 percent local match they were required to raise — to renovate the downtown federal building, which had most recently housed the School Board of Alachua County offices. The troupe held its first performance in the new Hippodrome Theatre in 1981 and has since performed for 4.5 million people, according to Mary Hausch, producing director.

The theater crowds helped provide a base of clientele that a lot of other businesses would come to depend on.

“It took 10 to 15 years for it to get even anywhere close to where it is now,” Hausch says.

More artists followed in the mid-1980s in what was supposed to be temporary studios in an empty building on South Main Street. (See “Pillars of the Community,” on page 54.)

Today the downtown arts scene boasts several more galleries, including the Gainesville Artisan's Guild Gallery, which in 2011 returned to the neighborhood in which it started 40 years prior. In November, 2011 the Arts Association of Alachua County and the Gainesville Fine Arts Association opened the Doris Bardon Community Center at 716 N. Main St., in the outer reaches of downtown.

Adding to the sense of activity are the many events now held downtown, such as the longtime Santa Fe Spring Arts Festival and the Downtown Arts Festival, the last Friday of the month Artwalk, the free Friday night concert series at the Bo Diddley Community Plaza, the Union Street Farmers Market on Wednesdays, United Way's United Downtown festival on the Fridays before Gator football games and the First Friday events, with specials offered at downtown businesses.

The Rock of Gainesville church opened a downtown annex in January 2012 at the site of the old Happy Hours poolroom after seeing an opportunity in downtown's growth and the large population of students and younger families who live in the area.

The Tech revolution

Technology companies and student startups have brought a new energy in recent years.

Downtown has served as an unofficial incubator for tech companies, a trend that began before innovation became the buzzword in Gainesville's economic development circles. The entrepreneurs and software developers have been holding events such as Startup Hour and Startup Weekend at downtown venues.

The McGurns have been landlord to most, and investors and mentors to several, starting with Gold Standard Drug Database in the mid-1990s. The tech trend picked up in 2003, when the founders of what is now RTI Biologics set up the investment company Synogen and its portfolio companies on the second floor of Sun Center West. Those and other tenants started small and outgrew the space. Video game company Trendy Entertainment took over the third floor of the Opera House. Prioria Robotics took over two floors of the Wells Fargo building on North Main Street before becoming the first tenant of the Power District in a former Gainesville Regional Utilities' warehouse earlier this year.

Across the street, on the second floor of Union Street Station, the popular online music service Grooveshark (see related story on page 58) grew from one to three offices on the west side of the building before consolidating into one large space on the east side last year.

That left room for a growing RegisterPatient.com to return downtown and for Grooveshark and the McGurns to start the Founders Pad to nurture tech startups in a shared office space now housing 10 companies.

Toby Sembower says he wanted to be around the other tech companies when he opened his business, Digital Brands, on the second floor of the Opera House in December 2011. The company buys lunch for its 10 employees from a downtown restaurant every day.

He says the tech companies form a tight-knit community that helps each other out.

“There's a certain energy that draws employees, that draws people in to want to work down here, so it's a great little hub to start a business in,” he says.

Sembower says Gainesville has the potential to become like Austin, Texas, when more college graduates start to see what an appealing place Gainesville is to live and work.

“We really feel like a decade from now or 20 years from now that this is going to be a great tech hub with a few restaurants beneath the tech hub rather than the other way around.”

Scheel says the tech companies have brought back the downtown rental market.

Clif Nelson, owner and chef of Paramount Grill on Southwest First Avenue, says more of those types of businesses are needed to support a healthy lunch crowd. After opening in 2001, he more than doubled his space in 2008, giving the restaurant room to handle more private parties. But he says lunch business has been anemic since the recession hit at about that time. There are more restaurants offering lunch, and a couple of banks moved administrative personnel out of the area.

Last year, education software company Shadow Health (see related story, page 64) opened across the street from Paramount in the former American Apparel building.

“I hope that is the signifier of the types of businesses other than entertainment and service that is down here,” says Nelson. “There's already enough nightlife here. What's lacking is variety.”

Still, he says downtown is drastically better than it was when he moved to Gainesville in 1983 and started working at downtown restaurants.

“What's changed is there's less empty space,” he says. “The city's done a good job of incentivizing people to want to open up businesses downtown. The McGurns probably helped in that.”

The challenges of retail

Nava Ottenberg says downtown has not yet arrived as far as retail is concerned. She owns the 33-year-old business Persona Vintage Clothing, Costumes and Collectibles, which moved to Union Street Station in 2006.

The retail space there and in the Sun Center West across the street is full but has seen a lot of turnover in the last few years.

Ottenberg says they get a lot of business from people staying at the Hampton Inn and people going out to dinner and the theater, but that there is a lack of awareness about downtown retail shops in the community at large.

She spearheaded the effort that brought sculptures outside businesses in January, “trying to get people to walk around.”

As the future unfolds

There could be a lot more people walking around in the coming years with all of the plans in the works — from the redevelopment of the so-called Innovation District between downtown and the University of Florida to the Cade Museum and Depot Park on South Main Street to new office and residential development downtown. (See related story page 52)

In Innovation Square, in the heart of the district, the UF Innovation Hub opened in 2011 at the site of the former Shands at AGH hospital and incubates about 20 startup tech companies affiliated with UF. It also houses other companies that cater to them, such as patent attorneys and venture capital firms. India-based software company Mindtree Limited opened its first U.S. development center and took an office in the Ayers building across Southwest Second Avenue, with plans to create 400 jobs over five years.

This is just the beginning of the planned redevelopment in the Square. Student apartment company Trimark Properties will soon start building the Infusion Technology Center adjacent to the Hub on UF land as an eight-story building with first-floor restaurant and retail space, and seven floors of office and lab space for technology companies. Trimark then plans to build INSPIREation Hall, an eight-story dormitory and incubator for entrepreneurial students on land it owns on the north side of Second Avenue.

Trimark had been buying up the 1960s and 1970s-era medical facilities around AGH as older doctors retired and younger doctors opened offices to the west. The company is looking at building housing for graduate students and young professionals who would work in the district.

Ed Poppel is director of economic development for the corporation created by UF to develop Innovation Square. He says future plans call for more buildings with ground-floor retail space along Southwest Second and Fourth avenues and space for private companies to develop other buildings. The retail space could include a bank, food services, shops and a fitness center. A developer is trying to bring a grocery store to University Avenue.

“I can feel some of the properties around here moving,” he says. “The property appraisals are already going up.”

Poppel says several companies that want to be close to the university and downtown are in talks to move here.

He foresees a very different look for the area between campus and downtown in the future.

“The first thing you're going to see is a skyline. Much bigger buildings — six- to eight-story buildings,” he says. “Then you're going to see a vibrant economic center that probably would almost look connected from 13th Street to Main Street. You'll probably see some type of dedicated transportation running on University, Second Avenue, Fourth Avenue. A lot of intermixed retail and commercial. A lot of office buildings.”

“It'll be fun to watch.”

Scheel and Ken McGurn met earlier this year to talk about building larger, high-end condominiums in and around downtown for tech executives.

McGurn says the demand is there now, but it might take a few years for banks to start lending again on speculative condos.

McGurn says he is also in talks to build wet lab space for an expanding Gainesville company that is interested in the Power District.

Attorney Jon Wershow has seen the full life cycle of downtown Gainesville. His father opened a law office there to be close to the courthouse and he joined the firm in 1972. He expects that his building, at 204 SE First St., will get caught up in the redevelopment one day.

“I have the greatest building known to mankind but I suspect somebody is going to tear this down,” he says.

New Energy

Business owners say the new momentum is drawing more people downtown. They also credit coordinated efforts to keep the sidewalks and streets clean and to address negative perceptions by offering valet parking and curtailing panhandling.

Scheel says he sees more professionals downtown who don't live or work there, adding to the existing base.

“It seems like they're spending more money. They're going to the finer restaurants.”

He says business was up 20 percent at Mark's Prime Steakhouse last year and Vellos was up considerably, as well.

“The free valet has helped tremendously,” he says. “Everybody feels pretty safe downtown. We try to work together to keep it clean. The city's worked on streetscaping.”

Hiro Leung, co-owner of Dragonfly Sushi and Sake Company, says downtown's demographic has matured as more entertainment options near campus have drawn away some of the college crowd, “so we're seeing a more artsy crowd and a little bit less of the party crowd.”

Chris Silver says he went downtown for a quick dinner on a recent Saturday night.

“It was packed. The parking deck was full. This is way different than it was six years ago when I first arrived in Gainesville.”

Silver is the dean of the UF College of Design, Construction & Planning. The college has partnered with the city of Gainesville to apply for a grant to create an “arts nexus” in the downtown area, including a support network and maybe an incubator for artists.

As a professor of urban and regional planning, Silver sees in Gainesville the potential to do what Richmond, Va., did with Virginia Commonwealth University — expanding into older commercial areas, much like Innovation Square, and creating a demand for new housing.

“All of that's going to continue to create vibrancy downtown.”

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