Norfolk developer is stepping back from projects

A sign posted in the window of the Bankers Trust Building in Norfolk announces Bobby Wright's empty eight-story tilted tower is for sale. Other posters herald two nearby properties also up for bid, including the Monticello Office Building in the heart of downtown.

About 16 miles down the road in Virginia Beach, Wright's firm is putting the finishing touches on its latest project: a 42,000-square-foot, four-building strip mall with plans for a gas station. The developer has also bought land at the Oceanfront.

The shopping center near Oceana and General Booth boulevards is a departure for Wright. He made his mark by renovating rundown or forgotten buildings in Norfolk. He and his partners own at least nine properties downtown and one in the Fort Norfolk area. Each of them, he said, was purchased with the intent to redevelop.

But funding for complicated redevelopment projects that may not turn a quick profit has all but dried up, with banks reluctant to lend in an uncertain economy. Combine that with a softening of the downtown housing market and an office market that in the next couple of years will increase in available space, and it's clear why smaller developers like Wright are looking for an exit strategy.

"We sort of took on more than we could handle," Wright said. "If I had the capability to do them all myself - it's my love. But I know I couldn't go out and redevelop them all at once. There's probably no company that could in this credit crunch."

Wright, 44, was one of the first developers to take a chance on redeveloping buildings along Granby Street. In 1999, he transformed a three-story structure in the 200 block into the current home of Domo Sushi and his own offices. He did the same at two other addresses on the same block, spending an estimated $2.3 million on the buildings that now house MacArthur Pharmacy and Havana.

In 2004, the developer bought the Bankers Trust Building for $450,000 with plans to turn it into condos. After the structure was inspected, the first floor was declared unsafe, and it has been vacant ever since.

Signs on the 108-year-old structure at 161 Granby St. show an asking price of $3.2 million, and Wright estimates it would cost more than $1 million to correct the building's lean.

A few blocks north, the Monticello Office Building at the corner of Monticello Avenue and Market Street faces the prospect of its only tenant moving out.

Targeted Publications + Media, a division of The Virginian-Pilot that publishes Port Folio Weekly and Inside Business, among others, plans to move its headquarters next year down the street into a building that formerly housed Dominion Enterprises.

The Monticello building was once occupied by Great Bridge LLC, a now-defunct software firm owned by Landmark Communications Inc., parent company of The Virginian-Pilot. Tidewater Community College, which had occupied the third and fourth floors, moved out this year.

Though the prospect of the rent drying up for the Monticello building isn't attractive, Wright said he is not in a hurry to sell. His asking price for the four-story structure is

$11 million.

"I don't take pleasure in having empty buildings, but I'm not going to sell them to just anybody," he said. "I want what's best for downtown."

At the same time, an empty building gives the developer more flexibility in altering it to help him attract a store to the ground or basement floors, he said. Wright had wanted to modify the street-level floor to open up access to the basement for retailers, but he said officials at Targeted Publications had resisted.

"Now that it's empty, we can do anything we want," he said.

Wright said he wants to attract buyers who share his vision of preservation of the properties and will explore a joint venture with another developer. He hasn't ruled out future downtown projects, he said.

In fact, the developer whose goatee and close-cropped hair make him look more like a club promoter, still speaks with excitement about the corridor.

H. Blount Hunter, a retail and real estate consultant who has partnered with Wright, said the timing is right to sell.

"The market has matured around him," Hunter said. "That was one of the benefits of getting in early. I think he realized he could probably make as much money by selling them as he would by redeveloping them himself."

Roderick Woolard, Norfolk's development director, called Wright a pioneer of downtown Norfolk redevelopment.

"I think that part of Bobby's strategy has always been to look at investing in strategic properties," he said. "Now he is looking at what opportunities he has to deploy his assets, whether that be through sale or redevelopment."

But some observers said Wright's move isn't only a business decision. Along with his success over the years have come challenges.

"I think the city has certainly done some things that have been very supportive of the Wright Co.," said Cathy Coleman, president of the Downtown Norfolk Council. "I think there have been times when the city and the Wright Co. didn't necessarily agree."

Wright spent $4 million in 2005 to renovate the Granby Theater and turn it into a nightclub.

In March 2007, a shooting at the theater resulted in the venue being shut down for nearly four months, during which an investigation revealed multiple code violations, including an uninspected sprinkler system and fire alarm, and extension cords in use as permanent wiring.

The club reopened with tougher restrictions on drinking hours and tighter crowd limits.

"It was a little disappointing from our company's perspective," Wright said. "But I get it. The city had to be stern."

At the time, Wright put the theater on the market and recently said he still would consider selling it if the right buyer came along.

Norfolk Mayor Paul Fraim said developers come and go, and Wright's decision to sell buildings downtown is no reflection on the relationship between the developer and the city.

"Bobby is a respected member of our business community," he said. "We've treated him as fairly as we've treated anyone."

Wright tried for several years to attract retailers to Granby Street, chasing big names like Barnes & Noble and Virgin Megastores.

"Bobby does not have that rapport with the national retailers," said Hunter, the retail consultant and Wright partner. "It comes with time. It comes with being a big development organization and not a boutique firm."

He has been heavily involved in the downtown residential market, particularly with condominiums. Like

other downtown developers, he has had a difficult time selling units as the market weakened. Three of his condos at 500 Granby St. are still on the market.

Sture Sigfred Jr., a downtown Norfolk restaurateur and developer, said the city's core and Granby Street have benefited tremendously from Wright's work.

Still, he's just one developer, Sigfred said.

"I'm a cheerleader, and Bobby's a cheerleader, and there are other cheerleaders for this downtown. But it has them because it deserves them," Sigfred said.

"If I were to back away from downtown, if Bobby were to step away from downtown, those footprints would fill in quite quickly."

Josh Brown, (757) 446-2318, josh.brown@pilotonline.com