Frontage-road sites are a hot spot that cooled off
CHAMPAIGN – Twenty years ago, Anthony Drive was the place to be.
The frontage road on the north side of Interstate 74 attracted retailers galore. New motels went up in quick succession. Car dealerships flocked to the area. A new shopping center went in east of the Neil Street interchange.
And up-and-coming retailers Best Buy and Menards chose Anthony Drive as the splashiest place to enter the Champaign-Urbana market.
But within a few years of coming to town, Best Buy and Menards moved to bigger quarters farther north. A building designed for an Ethan Allen furniture store had trouble staying filled.
And two industrial properties along Kenyon Road – the frontage road on the south side of the interstate – sat on the market for months before being purchased by government agencies.
How did a hot spot turn lukewarm so fast? Commercial real estate brokers say the alternatives made possible by the extension of North Prospect Avenue tempered demand for properties on Anthony Drive.
"The whole dynamic changed radically with North Prospect. That became the power corridor," said Alex Ruggieri, vice president of Ramshaw Real Estate.
Even before that, the extension of Marketview Drive created a faster east-west connection between Prospect and Neil, taking traffic off Anthony Drive.
The result: Although properties along Anthony Drive enjoyed visibility from I-74, they weren't as accessible as newer properties being developed – and they didn't have the traffic count that North Prospect and Town Center Boulevard did.
"Better and more accessible alternatives came along," said Vance Barr, president of Barr Real Estate. "Once those were created, those companies moved on."
One factor that made North Prospect more attractive was the proximity to other big-name retailers, many clustered in shopping centers.
"Whenever you have co-tenancy like that, it represents serious competition to any other site," said Jerry Ramshaw, president of Ramshaw Real Estate. "When you can be in a center with Dick's, Michael's, Best Buy or Pier 1, the critical mass is drawn away from older properties. It's co-tenancy that generates higher traffic counts."
Plus, he added, "anything new is, by nature, very attractive to retailers."
Still, Anthony Drive shouldn't be counted out because locations with that kind of visibility are attractive to certain kinds of businesses, he said.
Hotels and auto dealers, for example, rely on traffic from out of town. Furniture stores also tend to be "destination-driven," while other stores rely on impulse shoppers and need the "immediate" access afforded by North Prospect.
"Furniture is like cars," said Mike Bruegge, who plans to open a new Ashley Furniture HomeStore in the old Menards building this month. "It's destination shopping. It's usually planned. You see what your tax return or inheritance is going to be. It's not like going out and buying groceries."
Bruegge can take cheer that one of Ashley Furniture's neighbors, La-Z-Boy Furniture Galleries, has enjoyed 27 years of business at 506 W. Anthony Drive, and has expanded during that time.
Motels have done well there too. The Red Roof Inn, at 212 W. Anthony Drive, and the Baymont Inn & Suites at 302 W. Anthony Drive, have had long runs, as have other inns immediately to the north.
It's also been a good location for car dealers. Sullivan Chevrolet – now Sullivan-Parkhill Automotive – was one of the first to locate along Anthony Drive, and O'Brien Hyundai-Mitsubishi operated there for more than a decade. In the years since, multiple dealers have opened to the north along Marketview Drive and Moreland Boulevard.
Ramshaw said he's confident good uses will be found for vacant buildings along the frontage roads.
"It's not a matter of making those properties more desirable," he said. "It's really just a matter of time before people need those locations and occupy those properties. They're good for the right types of use. Access is not a problem."
Tim Harrington of Coldwell Banker Commercial Devonshire Realty agrees location alone makes properties in that area marketable.
"It's always attractive because of access to the interstate," he said. "The only question is does (a particular property) get redeveloped or reutilized. Land values for all those areas have done nothing but increase."
In some cases, a building may have deteriorated, and the land value may exceed the building value, he said.
"It makes more sense to tear down the existing structure," Harrington said.
That's what JSM Management has chosen to do with the old Mountain Jack's restaurant at the corner of Neil Street and Kenyon Road. JSM spokeswoman Jill Guth said she expects the building to be down by year's end.
In other cases, buildings have to be reconfigured to be marketable. The former Rhodes Furniture building at 912 W. Anthony Drive is expected to be redeveloped, probably by next spring, to accommodate multiple tenants, Harrington said.
On Kenyon Road, two industrial/office properties – Colwell Systems and the Meadow Gold plant – were on the market for months before being sold for government use.
Meadow Gold was acquired by the city of Champaign for use by the public works department, and Colwell Systems was acquired this fall by Champaign-Urbana Public Health District.
"I really was excited that the new (public health) director (Vito Palazzolo) found a way to use existing building stock," Ruggieri said.
Ruggieri said at one time, the district had estimated that a new building for public health might cost as much as $15 million and require the issuance of bonds.
But the district bought the Colwell Systems building for $2.2 million, less than the appraised price, Ruggieri said.
Even with $3 million in upgrades, the project will be $10 million less than the once-proposed building – and the district will have space for future expansion, space that could conceivably be leased to another not-for-profit group in the meantime, Ruggieri said.
"The actual use is a perfect fit," Harrington said.