Farish: Must ‘Make a Profit’

Watkins Partners

Delayed again: Developers now say that the first block of the Farish Street Entertainment District will come online summer 2012.

by Lacey McLaughlin
October 26, 2011

Jackson developer David Watkins seemed to quell concerns when he presented a list of tenants for the long-awaited $100 million Farish Street Entertainment District project during a public presentation last week. The developer still needs approximately $13 million to complete construction, however, for businesses to actually open.

The Farish Street Group, a limited liability company Watkins Partners formed to oversee the project, has invested more than $9 million and secured a $4 million loan from the Mississippi Development Authority. The development was scheduled to open in summer 2010, but that schedule is now pushed out to summer 2012.

Watkins' original plans called for the tenants to finance improvements to the interiors of their buildings. The developers have "white boxed" the buildings, meaning that the exteriors are complete, but the spaces lack amenities such as furnishings, kitchens and décor.

Watkins said that the Farish Street Group will assume ownership of four clubs and finance the build-outs.

The Oct. 19 public presentation of the district's progress resembled a pep rally for Mississippi's cultural heritage and the promise of a development that could revitalize Jackson. Mississippi musicians—including Zac Harmon and members of the Williams Brothers Gospel Group—spoke about personal connections to Farish Street as well as plans to move into the district.

Harmon plans to open a blues club on the corner of Griffith and Farish streets, and the Williams Brothers plan to open a recording studio in the second block of the district. Watkins said the district also has signed leases with a cigar bar and sports lounge and with former Cool Al's owner Al Stamps for a restaurant. Other potential restaurants and clubs include Lumpkin's BBQ, Wet Willie's, Van Buren's and Sage/The Raw Bar. The Farish Street Group has secured a 15-year lease agreement with B.B. King's Blues Club.

Watkins said tenants would pay $8 to $12 per square foot for rent each year. Business owners will also pay a percentage of their gross income and a maintenance fee to pay for things like water, sewer, insurance, security and utilities.

"We have to make a profit off of what we are doing in order to operate the street and do all the marketing," Watkins said.

"We are planning on spending a half million a year on advertising all over the world, and that doesn't go very far."

Watkins Partners Vice President Jason Goree said B.B. King's Blues Club is focused on opening a Las Vegas location and has experienced setbacks. In February, the owner of B.B. King's Blues Club at the Las Vegas Mirage Hotel and Casino filed for bankruptcy to restructure $3.7 million in debt and other liabilities, the Las Vegas Sun reported.

"It's not that they don't have the money," Goree said. "But now they are doing another building (in Las Vegas). They can raise their own money (to do the Farish Street build-out), but if they do it, it's going to take longer. So what we have decided to do is try to help them come up with the money for this place so they can come here quicker."

Representatives from B.B. King's Blues Club declined a request for an interview.

Standing in his future club last week, Harmon shared stories about Farish Street, telling an audience of more than 100 that his father, George Harmon, owned a pharmacy on the street for more than six decades. He also shared plans for the mainstream blues club, which will draw musicians such as Tommy Castro and Ronnie Baker Brookes.

Harmon declined to speak about the details of financing the club, however.

"As far as the business goes, I don't discuss my business," he told the Jackson Free Press. "We can talk about the club, what the club will look like, and we can talk about my career, but we can't talk about the business."

Bill Bynum, CEO of Hope Enterprises Corp., a nonprofit financial institution, said his organization was committed to working with developers to obtain New Market Tax Credits and up to $14 million in financing.

Watkins has obtained historic tax credits for the project, which requires all buildings to keep their existing facades and structural integrity.

During the presentation, development partner Socrates Garrett suggested that the city consider offering public financing for the project. Watkins said he has not asked the city for financing, but it could be a possibility in the future.

Watkins also announced long-term plans for the district last week, including some new projects.

The second block will include a "business hub" for video and audio production, sound stages and a mixed-use residential building. The third block will include a gospel music museum, a boutique hotel and an eight-screen movie theater that will also serve dinner.

"We just have to have a long view and make sure that we don't let minor hiccups along the way turn us away from it," Watkins said. "There is great enthusiasm and excitement, and it's not just David Watkins and (Downtown Jackson Partners President) Ben Allen having a pep rally. We have people all over the world interested in this project.

"It was a risky project from the beginning, but we know that because of the high risk and leverage, it's going to have a high return."

Correction appended 10/28/11: A previous version of this story stated that tenants will pay $8 to $12 per square for rent each month. Tenants, however, will pay $8 to $12 per square foot for rent per year. We apologize for the error

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