As properties sell, stakeholders say opportunities persist in downtown Johnson City

David Floyd • Oct 19, 2019 at 11:00 PM

As developers eye more and more buildings in downtown Johnson City for projects, it’s worth asking if there are still structures available for potential buyers.

While there isn’t as much free inventory in the downtown area as one might think, Dianna Cantler, the downtown development director for the Johnson City Development Authority, said Wednesday that, fundamentally, there are still options.

“There’s some that may not be listed, but if you reached out to a property owner they may be willing to discuss selling,” Cantler said.

Over the past year, city officials have witnessed multiple buildings in downtown Johnson City change hands. That includes four buildings on the third block of East Main Street that were recently acquired by JC Downtown OZ, an affiliate of Mitch Cox Companies and Universal Development & Construction. The owners plan on turning the properties, which were previously owned by the city, into a development called The Henry, which will include both commercial and residential space.

Buildings along North Commerce Street have also changed ownership in recent years, including two at 115 and 117 N. Commerce St. that were bought by a pair of local business partners earlier this year.

“There’s been a lot of people from both here in town or outside the region that have looked at the buildings here and the revitalization that’s happening downtown and want to be part of what’s happening,” Cantler said.

David Ross, an Asheville developer and owner of Falcon Construction and Development, is renovating a downtown building at 244 E. Main St., the former home of Masengill’s Specialty Shop. He purchased the property in 2018.

Ross said there were many properties available in the downtown area when he was looking for space in Johnson City in mid-2018, and chose the building on East Main Street because of its location — the historic structure sits at the corner of East Main and North Roan streets and isn’t in a flood plain.

As time goes on, Ross said many of the good buildings in downtown Johnson City have new owners.

“It’s getting tighter for that reason,” he said.

Shannon Castillo, a broker at Mitch Cox Companies, said there are still several buildings on the market in downtown Johnson City, and as projects continue, there will soon be a variety spaces available for lease in an assortment of sizes.

“In my experience in working downtown, the one thing that has sometimes been a detriment is that we don’t have a lot of small spaces available to lease,” she said. “And the good news is that we’re about to get that.”

Downtown challenges

Desirable buildings in downtown Johnson City, many of which used to be department stores, are often 5,000 square feet or more, which is a large space that Cantler said businesses can find difficult to fill. Manageable spaces would typically be between 1,800 and 2,500 square feet.

Owners have solved this problem, Cantler said, by subdividing the space inside these buildings into multiple suites that have suitable square footage for small businesses. Cantler said this was the solution implemented at 207 W. Main St., a building that houses C.S. McCullough's and What’s the Scoop.

The historic nature of many of the buildings downtown can also pose a challenge to inexperienced buyers.

Castillo said prices and the conditions of the buildings in downtown Johnson City can put a damper on investment. Some may need a new roof, and some may need to be brought up to code.

“For somebody who has maybe never done a development project before, doesn’t have a background in commercial construction, it makes entering into becoming an owner of one of these buildings somewhat difficult,” Castillo said.

Officials are also still trying to figure out how to handle buildings that have fallen into disrepair because of absentee owners, which is a problem that Castillo said has become less of an issue in recent years.

“There are some buildings that do have some out-of-town landlords, and some of them aren’t keeping up with their building, and it’s really a sad situation,” Castillo said. “I’m hoping we can continue to build trust and relationships with those folks.”

Cantler said the building at 107 Buffalo St., often referred to as the 1888 building because of the time stamp at the top of the structure, is the “poster child of neglect” in Johnson City.

However, Gemma Velasquez, a California resident who has owned the building with her husband Murray Cruickshank for more than 20 years, said Friday that the pair is gearing up for renovations to the structure.

Restorations to the 1888 building

Plans have been in development for about a year, Velasquez said, to restore the 1888 building. She said Ernest Campbell Development will manage the project, and Artistry in Glass, a Limestone-based business, will restore the antique glass above the building’s storefront windows. She said work will also be done to restore the building’s masonry. 

The couple is now seeking a building permit from the city. They envision the space would eventually be home to some form of business.

“It has been a challenge finding the right team of craftspeople who would be sensitive to the building's period aesthetics,” Velasquez said, “but we are hopeful that we have found the right team.”

Velasquez declined to give the dollar value of the couple’s planned investment into the building, but said it will be “significant and meaningful.” Velasquez said she and Cruickshank recently spent about $30,000 to conduct roof work on the building.

Velasquez said she and her husband bought the building while they were living in Jonesborough with the hope of turning it into a restaurant. At the time they purchased it, Velasquez said the building had probably been vacant for about 10 to 15 years.

“Unfortunately, we don’t live in the area any longer, so we were unaware that it had needed such work and the facade had fallen into such disrepair until we were made aware of it by the city,” she said, “and at that point, we started looking for contractors.”

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