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Developer Donahue Peebles III had a tough job last week.
Peebles, an executive with the Florida-based Peebles Corp., had to tell Mecklenburg commissioners why construction hadn't started on the $700 million Brooklyn Village project, eight years after his firm was chosen by the county to develop the 17-acre site.
He then had to deliver more bad news: Construction probably won’t start on the first phase — apartments and a hotel — until 2026.
The project receives extra attention because it’s meant to make amends for the destruction of the majority Black Brooklyn neighborhood in the 1960s that was part of urban renewal efforts nationwide.
The Peebles Corp. was chosen, in part, because it’s minority-owned. The county understandably wanted a Black-owned firm to benefit from rebuilding the neighborhood.
In exchange for a lower price to buy the land in Second Ward, Peebles agreed to include affordable housing.
Peebles emphasized those themes, saying the site work done like utilities is “another incremental step in a long journey ... steeped in cultural and political significance.” The Brooklyn Village project, he said, “spoke to the core of our business and our family and all of the values that shape our nation.”
For a commission with all Democrats, this was pretty good messaging.
But he still had to explain why barely any real work had happened.
He told them his company had trouble clearing deed restrictions on some of the land. That lasted several years, he said. Then came the coronavirus pandemic.
And to justify the full decade of delay, Peebles painted a picture of economic gloom and doom.
His talking points would have fit in nicely at last month’s Republican National Convention.
He said high interest rates have caused “the economy to seize up,” pointing to this week’s stock market fall.
He said “banks are underwater” because of bad commercial office loans.
Investors want higher returns, but he said glumly that Charlotte now has too many apartments, causing rents to fall. That means, he says, the Peebles Corp. can’t charge high enough rents.
The problem: Why didn’t Peebles secure financing in 2021 or 2022 when interest rates were low? How have other developers managed to build thousands of apartments all over the city since the pandemic?
Northwood is finishing the Bowl at Ballantyne — a massive mixed-use project of apartments, offices and retail that’s bigger than Brooklyn Village. It includes a 26-story residential tower.
Another developer is converting the old Duke Energy headquarters uptown into apartments and renaming it Brooklyn and Church. That project is about a half-mile from what’s supposed to be Brooklyn Village.
So while the main development of Brooklyn Village languishes, other developers are launching Brooklyn-themed spin-offs.
(That developer, Asana Partners, wanted $19 million in property tax rebates from the city and the county. Commissioners were skeptical of his request, and it appears the project is moving forward without financial help.)
To Commissioner Laura Meier, Pebbles wasn’t making sense. She asked how are apartments being built all over the city. Why is the new Atrium medical school that was announced in 2019 well into construction?
What’s noteworthy is this isn’t the first time a public-private partnership has gone sideways.
- The Charlotte Housing Authority, now known as Inlivian, tore down the Strawn Cottages in Dilworth for low-income seniors in 2018. It partnered with a Boston developer to build a mixed-use site on the project. Construction hasn’t started yet.
- Mecklenburg County also wanted to redevelop 7th and Tryon uptown. The county and a developer signed an agreement four years ago, but the $600 million project is now essentially dead after the main lender pulled out.
The city of Charlotte has big plans for a new Amtrak station uptown, the focal point for the Gateway Station district of offices, retail and apartments.
The N.C. Department of Transportation has finished the track work needed for the station to open, but building the actual station is the city’s responsibility. And Charlotte has wrapped the station into an overall plan for a larger development, which is stalled.
The state and the city held a groundbreaking ceremony for Gateway in ... 2018.
- Charlotte is also embarking on a second transit hub uptown, with plans to place the main bus station underground. A mixed-use tower would be built on top of it, allowing for, in the city’s words, a new “Entertainment District” near the Spectrum Center. This project is relatively new, dating back to only 2022. But there are already warning signs: The county isn’t providing any money, and cost estimates are going up.
- Eastland Mall is another public-private partnership. Crosland Southeast is now building apartments on the site of the old mall, which is a success — especially in an economically distressed area. But it took 11 years since the city demolished the mall to get here. In that time, the city considered dubious plans for the site such as movie studios and an outdoor ski jump. Once the city scaled back its goals, the project was able to move forward.
Have the city and county created projects that are too big to succeed?
What will happen with Brooklyn Village?
The only commissioner to defend Peebles was Chair George Dunlap, who voted to pick him last decade.
The others who spoke were either exasperated by the delay, like Vilma Leake, or befuddled and angry, like Elaine Powell.
“There is a significant part of the population that is outraged about how long this is taking,” Powell said.
Pat Cotham, who voted against Peebles, essentially said I told you so.
“We had a vote on it multiple times, and I voted no four times,” she said. “And here we are, and I’m not surprised.”
It appears the county could move to break the contract with Peebles next year, if construction hasn’t started by then. But will they?
