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Winston Hotels Eyeing Downtown Raleigh, North Carolina for a
 200 room Hotel with 250 Condos in a 25 Story Tower

By Jack Hagel, The News & Observer, Raleigh, N.C.McClatchy-Tribune Regional News

May 14, 2007 - RALEIGH -- For 17 years, Rodney Marsh straightened bent saxophones, replaced clarinet keys and sold used fluegelhorns at 513 Hillsborough St.

"I liked being on a main street," he said. "I liked my landlord; they didn't jack up the rent."

But in January, Marsh decided to move Marsh Woodwinds to North Person Street in the city's Mordecai neighborhood. His old location, smack between emerging parts of downtown, was on a month-to-month lease.

He saw the writing on the parking lot: Men in vans would paint pink arrows on the pavement and drill into the ground to test soil, indicating that a developer wanted to buy.

"Every time somebody would show up with a hard hat and a clipboard and started doing surveying, we started getting nervous," Marsh said.

For the past few years, developers have battled for a shrinking number of development sites along Fayetteville Street, downtown's main business artery, and in the city's entertainment district on Glenwood Avenue, which is a few blocks away.

Now they're setting scopes on a six-block stretch of Hillsborough Street, from Boylan Avenue to the state Capitol, hoping to bridge the two areas. They're paying big bucks, hatching plans to redevelop squat, scraggly buildings and empty lots into sky-high hotels and condominiums.

"Ten years from now it may be similar in scale to where Fayetteville Street is today," Mayor Charles Meeker said. "I don't think anyone realized how quickly downtown would develop or that Hillsborough Street -- even three years ago -- would be a major development corridor at this point."

The latest proof came last month when Winston Hotels announced plans for 200 hotel rooms and as many as 250 condominiums in a tower that could rise 25 stories. The project would replace a faded cluster of buildings catty-corner to Marsh's old shop.

Two blocks east, at the southwest corner of Hillsborough and Dawson streets, Reynolds Co. wants to build a 27-story tower with offices, condominiums, shops and hotel rooms.

TME Investments has discussed building hundreds of condos or apartments at the southwest corner of Hillsborough Street and Glenwood Avenue. That tower could rise 20 stories.

The Episcopal Diocese of North Carolina is even in on the action. It paid $2.75 million May 1 for a 19,000-square-foot office building on 0.67 of an acre bounded by McDowell, Morgan and Hillsborough streets. The diocese has no immediate plans to redevelop. "This is one way to plant the cross of Christ at the crossroads that is our state Capitol, where laws are made and business is transacted," Bishop Michael Curry said in a statement.

More projects could be in the works. Empire Properties, one of downtown's biggest developers, owns a 0.31-of-an-acre lot at the northwest corner of Hillsborough and Dawson streets.

And there's Marsh's former block. HBS Properties has assembled all but two tracts on the 1.15-acre block bounded by Edenton, Morgan, West and Hillsborough streets.

The group is trying to sway Montgomery & Associates, whose partners include Meeker, to sell its 0.16-of-an-acre sliver. If successful, the single-story storefronts dating to the 1930s could give way to shops and condos.

"It probably wants to be something bigger," said Peter Pace, the York Properties broker who represents HBS. He said there are no immediate plans for the property, although he fields calls regularly about its sale.

The projects are expected to push west, making a better connection between N.C. State University and downtown.

The Boulevard Co. of Charlotte plans to redevelop the former Tao Auto site at Hillsborough Street and Boylan Avenue.

FMW Development -- which assembled the land for Charlotte's Bank of America Stadium and Bank of America Corporate Center -- has a $7.15 million contract to buy a cluster of industrial buildings and empty lots on 5.6 acres near Morgan and Hillsborough streets.

"It's only a matter of time before Snoopy's sells out," Marsh said about the hot dog stand at Hillsborough and Glenwood. "They're going to be dwarfed."

Staff writer Jack Hagel can be reached at 829-8917 or jack.hagel@newsobserver.com.

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Copyright (c) 2007, The News & Observer, Raleigh, N.C.

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