Demand continues for downtown Winston-Salem rental properties, official says

By: Richard Craver | Winston-Salem Journal
Published: June 09, 2011

Downtown Winston-Salem has arrived at another crossroads with its housing market.

Despite having 1,194 units in the downtown core – and 1,960 overall – pent-up demand continues to build, particularly for rental space, according to Jason Thiel, president of the Downtown Winston-Salem Partnership.

That’s the bright side of the issue, Thiel told about 150 attendees today during a presentation updating downtown initiatives that also involved Piedmont Triad Research Park and the Center for Design Innovation.

Thiel said downtown’s housing challenge is trying to balance pent-up demand with the dynamics of supply and demand that appear to be driving rental costs up. Thiel said that the downtown housing units are 60 percent rental and 40 percent owned.

“The question is determining how many more units are needed, thus the opportunity and the risk,” Thiel said. “We need a diversity of housing where multiple income levels work.”

The 2010 Census shows population growth of 36.9 percent over past 10 years, from 1,499 to 2,052, in the city center's primary census tract. Even though three of the five census tracts lost residents, downtown had a net gain of almost 1,000.

Thiel said he knows of about 185 rental housing units in the planning stage, including 110 units for the Hilltop House development at 234 S. Cherry St.

Bud Baker, the former top executive of Wachovia Corp., is aiming Hilltop House at students, young professionals or retirees looking to downsize. Rents will range from $650 to $850 a month for units in the older section and will range from $825 to $1,050 in the new building.

Another project is the due-diligence stage is with U.S. Development Co. of Columbia, S.C., which is planning a mixed-use project on Trade Street that would include 60 high-end studio and one-bedroom units for rent on three floors of Coe Plaza in the $700-a-month range. It also has plans for a restaurant and retail shops on the first floor,

“We’re still waiting for the suburban housing markets to free up enough so that people who want to buy a unit downtown can sell their house to be able to do so,” Thiel said.

Doug Edgeton, the president of the research park, said that construction on Research Park Boulevard will begin by late summer and take about 18 months to complete.

The four-lane road will run from Stadium Boulevard to Third Street. It's estimated the project will cost $8 million, according to documents given to the Winston-Salem City Council. The N.C. Transportation Department has allocated $4 million, with the city and Forsyth County paying the rest.

City officials intend to use $2.8 million in repaid Dell Inc. incentive money for the project.
The city and county will pay the remaining $1.2 million with money that the City-County Utility Commission makes by selling water outside of the county.

Carol Strohecker, director of the Center for Design Innovation, said officials have resumed architectural and site-preparation efforts for its planned three-story building in the research park. She said the center is considering an indoor amphitheater-type auditorium.

The UNC system acquired in January nearly four acres in the South District. Construction has been projected to begin by the end of the year.

The land cost slightly more than $1 million. The money came from a pot of more than $11 million in state-allocated capital funds Winston-Salem State University has been holding for several years for the center.

The center has been operating since 2007 at a temporary site in Winston Tower.

It was established in 2005 as a multicampus research center of the UNC system, the result of a partnership between WSSU, UNC School of the Arts and Forsyth Technical Community College. WSSU is handling the design and building of the center, and the UNC School of the Arts will oversee its maintenance and operations.

The event was sponsored by the Winston-Salem Chamber of Commerce.