A surprising mix of businesses thrive at this downtown stadium. Can it work in Knoxville?

When Bill Bell first arrived in Durham, North Carolina, the city smelled of tobacco.

That was in 1968. But over the decades, the longtime county commissioner and city mayor watched the tobacco industry leave downtown, and abandoned warehouses became target practice for local law enforcement rather than economic drivers.

It took nearly 10 years after the American Tobacco Company left Durham for the smells of resin and popcorn to fill downtown. It represented the start of a new type of industry and a reversal of downtown's decline.

In 1995, the Durham Bulls baseball team moved into a new stadium adjacent to those warehouses and, over the next 25 years, downtown Durham transformed.

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Today, office and apartment buildings tower over the stadium's outfield walls, while the American Tobacco Campus – now an economic driver of a different sort – accommodates office tenants and a diverse mix of local restaurants. Retail shops and the occasional chain also are located nearby.

During the 2019 season, the Durham Bulls reported a direct $33.3 million economic impact on the city and supported 25,152 jobs. That same year, the Bulls' season generated $1.4 million in local taxes.

“In my opinion, (the stadium) was a catalyst for the ... rebirth of downtown Durham,” Bell told Knox News. “I saw buildings (that) were shuttered suddenly were opened (with) lights. I saw people walking downtown in the evening: families, people pushing their carriages with babies in them. White folks, OK? It was a different atmosphere.”

By 2035, Tennessee Smokies owner Randy Boyd envisions something similar for the Old City and Magnolia Warehouse District, which he believes can become the “epicenter” of downtown Knoxville. 

Knox News recently visited Durham to learn about how a baseball stadium could attract nearby development that serves everyone, from big-tech employees and recent college graduates to longtime locals and minority entrepreneurs.

Public funding already has been approved for the Knoxville stadium, though a final price for the structure has not been determined. The previous estimate of $80.1 million likely will increase due to unpredictable construction costs, and Boyd has promised a loan up to $20 million to cover the difference.

That loan would be repaid through an expanded tax increment financing district, but Boyd will be personally responsible for any costs that go over the final estimate, which should be determined this winter.

Here's how the Durham stadium spurred growth and economic prosperity in its neighborhood.

Stadium creates 'ecosystem' for talent

The Durham stadium complex has worked not only as a driver of investment, but also as a recruiting tool for residents and potential employees.

“The younger generations these days appear to be making the decisions on the where of their happiness, and they’ll figure out how to make an income secondary,” said Geoff Durham, president and CEO of the Greater Durham Chamber of Commerce. “So, the ballpark has ... helped create an ecosystem that talent wants to locate in, and companies are now chasing that talent.”

Office and apartment buildings overlook Durham Bulls Athletic Park, which has been considered a catalyst for economic growth since it opened in downtown Durham's abandoned warehouse district in 1995. The stadium district has helped form a city where talented professionals want to live, according to the Greater Durham Chamber of Commerce, and the uniqueness of the area surrounding the ballpark has led to big-name office tenants moving in.

Capitol Broadcasting Company, the Bulls’ owner, first opened the Diamond View I office building outside the stadium in 1998, followed by Diamond View II in 2008. These buildings help “set the edge” and create and “urban, intimate ballpark,” said Adam Klein, director of Durham real estate for Capitol Broadcasting Company.

CBC also led the redevelopment of the American Tobacco Campus, where Lucky Strike cigarettes were once manufactured, partially because no other developers were willing to commit to such a risky, large-scale project, which involved renovating 850,000 square feet across 11 historic buildings.

“The thing I love about this community is (it has never) been afraid just (to) take a chance and just do something first and see if it works,” Durham said. “And so, the folks that made the bold decision ... to (say) let’s take this old Lucky Strike warehouse and turn it into something … that’s bold, that’s brave and we’re always trying to figure out what’s next.”

Major office tenants signed on early at Diamond View I, including Duke University, helping encourage interest from other developers and potential tenants.

In Knoxville, the early planned developments around the stadium aren't offices. Boyd will rely instead on residents to produce a lively environment that encourages future growth, with an apartment building and a condo building in the plans, which also could contribute to an "intimate ballpark" feel like the Diamond View structures.

Detailed plans have not been announced for the apartment building. But the Beauford Delaney condo building, named after the Harlem Renaissance artist and Knoxville native, will be a substantial structure, comprised of nine stories and between 35 and 45 condos. The building will be constructed along the first-base line and will offer residents home-plate views. Team offices and commercial space also are planned for the building.

This residential approach, while different than Durham, has merit. Economic experts will tell you retail follows residential, meaning investors and entrepreneurs consider nearby population before committing to building or operating in an area.

The Double-A Smokies team plans to begin playing home games at the new publicly funded downtown stadium in 2025. Around that time, the apartment and condo developments are expected to open.

American Tobacco Company, which once produced Lucky Strike cigarettes, left downtown Durham in the 1980s. In 2004, the American Tobacco Campus reopened as a mixed-use community comprised mostly of office tenants, with restaurant and retail spaces sprinkled throughout the grounds next to Durham Bulls Athletic Park.
American Tobacco Company, which once produced Lucky Strike cigarettes, left downtown Durham in the 1980s. In 2004, the American Tobacco Campus reopened as a mixed-use community comprised mostly of office tenants, with restaurant and retail spaces sprinkled throughout the grounds next to Durham Bulls Athletic Park.

But aside from the athletic facility and these nearby structures, most development around the stadium will be in the hands of private developers, many of whom aren't tied to Boyd or the stadium project in any way.

A 2021 economic impact study of the Knoxville stadium anticipates the city would generate $281.9 million in net new direct spending that would generate $477.7 million in total output during construction and for 30 years of operation.

Maintaining a 'homegrown' community

A major concern for some Knoxville residents is how a downtown ballpark might price out some businesses from capitalizing on anticipated growth. Through a partnership with the Knoxville Area Urban League, Boyd has said he wants to serve disadvantaged businesses and intern-aged people of color with workforce and entrepreneurship programs.

Durham and the Triangle region of North Carolina are uniquely positioned to serve as a hub for technology, thanks to multiple major universities in the area. While tech companies occupy office space around Durham’s stadium, that doesn’t mean all the jobs require advanced degrees, lab coats and goggles, Durham said.

Many opportunities simply require job-specific training and apprenticeships.

“I really believe that the ballpark catalyzed this ... If you were to make (downtown) like a tenant board in a mall, downtown Durham’s tenant board is going to look unlike any other place you’ve ever been because the large majority is homegrown and locally sourced," Durham said. "Not only is this a high quality of life and an amenity piece, but it’s where my pipeline is coming from for the next generation of workers.”

But it’s not all about the workforce.

Opportunities for minority entrepreneurs

Minority entrepreneurs have opportunities around Durham’s stadium, and Boyd is planning to take a similar approach in Knoxville. He already has offered prime space in his stadium plans to Jackie B. Griffin, the namesake of popular Knoxville soul food restaurant Jackie’s Dream.

Griffin did not respond to a request for comment for this story.

In Durham, Klein said women and people of color together represent more than half of the restaurant and retail owners in the American Tobacco Campus. That's intentional, and is orchestrated by charging a bit more for corporate office tenants to give these local entrepreneurs below-market rents.

“We want to work with our office partners, understand what they want,” Klein said. “If you add 25 cents a foot onto your office rents because you’ve got a really vibrant mix of local restaurants – it's become kind of the gold standard of downtown dining – they’re happy to pay that because they want that kind of experience.”

Toriano Fredericks owns Boricua Soul, a Puerto Rican and Southern fusion restaurant steps from the Durham stadium at the American Tobacco Campus. Prior to opening this permanent space, the food truck operator paid just a percentage of sales to take over a pop-up restaurant spot on campus dedicated to letting entrepreneurs test brick-and-mortar concepts.

“At that point in our business life, I know we didn’t have the capital and the history to have opened a restaurant at that point,” he told Knox News. “Being here also gives us the opportunity to see different people (on game days) – people that otherwise may not really know about our business.”

Fredericks told Knox News his rent is a percentage of sales, in addition to a maintenance fee.

Not a game? It's business as usual

While Boricua Soul’s mojo chicken empanadas might make for a nice pre-game meal, a coffee shop doesn’t exactly scream baseball – nor does nearby stationery store Parker Paper Company. Yet, both businesses have a footprint around the Durham stadium.

Boyd has emphasized the Knoxville stadium and surrounding mixed-use developments will have outward-facing retail and restaurant space that’s open year-round. CBC has learned through trial and error the businesses that are most successful are year-round destinations in their own right.

While a coffee shop does not seem like a likely candidate to fill stadium-area commercial space, it is one of the many concepts located near Durham Bulls Athletic Park. While the restaurant district used to rely on more sports-focused businesses, those in charge of securing tenants now focus on concepts that can serve as year-round destinations on their own.

For a while, the nearby Durham restaurant community comprised sports bars and other concepts people typically associate with baseball. But the Bulls only play at the stadium 72 days each season, Klein said, and businesses need to make money throughout the year.

“There’s a little bit of this effect of kind of benefiting when the Bulls are around but also being able to be your own restaurant when they’re not," Klein said.

Even when the Bulls aren’t playing, residents can take their coffee next door to the stadium, where part of the concourse is open throughout the year with table seating and pathways above the outfield. Boyd plans to open the concourse in Knoxville for residents to walk and eat on non-game-days.

“Of equal importance, we’re also selling culture,” Durham said about recruiting businesses to the area. “And you can point to our downtown and around the ballpark as part of that unique culture.”

Working near a stadium: 'Make it count'

The question becomes whether office space can continue to serve a prominent role in downtown business communities. An August 2021 poll by Digital.com of 1,250 business owners shows 37% of companies have permanently closed all offices since March 2020, while an additional 32% got rid of some office space.

Even when games are not happening at Durham Bulls Athletic Park, the neighboring American Tobacco Campus is a hub of activity. Restaurants and shops on campus serve employees of the upper-level office space, as well as locals simply looking for a scenic stroll in an urban environment.
Even when games are not happening at Durham Bulls Athletic Park, the neighboring American Tobacco Campus is a hub of activity. Restaurants and shops on campus serve employees of the upper-level office space, as well as locals simply looking for a scenic stroll in an urban environment.

While businesses across a variety of industries are scrambling to attract workers, a hip stadium district could be a selling point when it comes to recruiting talent.

“I think on the office side, there’s a … gravitational pull of businesses that want to be around an entertainment district like this that has the Bulls, has the (Durham Performing Arts Center), that has the green space that we have – and the historic structure,” Klein said. “If you’re going to come to work, and you’re going to come to work three days a week, make it count.”

No matter what happens to the business community around the Knoxville stadium in its first years, “markets have cycles and behavior changes,” Durham said.

“I think the trick is when you find the answer for a now, don’t be married to it forever,” he said.

This article originally appeared on Knoxville News Sentinel: Smokies baseball stadium spurs downtown Knoxville growth as in Durham