The UnTower Manifesto: 3. Beyond UnTower

Rob Morris 0 Comment Business, CentrePointe, Community, Ideas, Neighborhood, Rants, UnTower

[Note:
The UnTower Manifesto is a three-part series about responding to the failure of
CentrePointe.  You can read the full story of that failure here.]

The final piece of the UnTower puzzle is what to do with the pit now that the historic buildings are gone and the promised tower cannot be built. 

Up front, let me declare that I don't have all of the answers regarding what needs to be done with the block.

But I do have some general principles which we might start to apply to the site.

  • Create a vibrant destination which attracts in-town residents, weekday workers, other folks from throughout the Bluegrass, and tourists.
  • Make that destination a distinctive place which no other city has (and this doesn't need to be a towering monument to ego)
  • Create public and private spaces within the destination which allow the community to create shared experiences while also providing a much needed economic boost
  • Balance the types of uses within the development to include an attractive mix of retail, nightlife, dining, and lodging options
  • Ensure local businesses have significant presence within the development to help supercharge the local economy
  • Ensure that the space is well-integrated with the surrounding community and that its design promotes circulation throughout surrounding businesses and public spaces
  • Build it soon.  Remove the eyesore that the UnTower scandal left behind.

So lets look at these principles in more detail.

Destination.  If we want the UnTower block to directly feed the local economy, we need it to function as a destination for both our visitors and our community.  The previous imposing design did not encourage local residents to participate in the space.

Distinctive Place.  The new development should, to the extent possible, function as a signature place for Lexington.  Much like Keeneland and our horse farms showcase Lexington as a city like no other, the new development should showcase our city, our region, and our people.  Portland, Austin, Miami, Chattanooga, Denver, and even Louisville have these memorable and distinctive signature places.  Lexington should, too.  A distinctive place will draw people (and dollars) into our community; A forgettable one will not.

Public and Private Spaces.  The most effective places (like those in the cities above) combine public spaces with private enterprise.  Thus, memorable shared experiences can also feed the local economy.

Balanced Use.  Others have proposed using the block for a single kind of use – say, a new basketball arena.  Such dedicated uses of the property would be counterproductive to our economic engine.  To get the biggest economic bang for the buck, we should encourage a unique and balanced mix of stores, restaurants, attractions, clubs, and perhaps a unique 'boutique' hotel.  (My best-ever customer experience was at a Kimpton Hotel, which made for a hugely positive impression of Portland in general.  What if Lexington could wow its visitors like that instead of giving them a bland cookie-cutter hotel?)

Local Businesses.  To supercharge the impacts of the dollars spent within the new development, we should try to ensure that many of the businesses located there (30%? 50%?) are local businesses.  This will yield two big benefits.  First, it would contribute to the distinctive character of the place.  Second, it would keep a significant portion of that money in Lexington.

Integration.  When CentrePointe was proposed, many derided the design as too fortress-like and too disconnected from the city fabric.  The UnTower scandal offers an opportunity to correct that mistake.  The new development could more thoroughly integrate with several aspects of downtown development.  The site borders Phoenix Park, Courthouse Plaza, and the History Museum / old Courthouse / Cheapside complex.  An 'open' design would promote circulation through those spaces (and into surrounding businesses) and would better integrate with our other urban initiatives (such as our street improvement plans).

Build Soon.  Regardless of the type of development we ultimately put on the UnTower block, we probably have missed our window for using it to improve our city's appearance for the World Equestrian Games in 2010.  Nonetheless, we cannot allow the crater left by UnTower to remain. 

Is this list comprehensive enough (or even correct)?  Probably not.  Feel free to point out what I got wrong or what I missed.

In any case, this is the kind of civic discussion that the citizens of Lexington must engage in if we are to build a better community – and if we are to heal the scar in the middle of our city.

[where: E Main St & N Limestone St, Lexington, KY 40507]

What do you hate about Lowell’s?

Rob Morris 2 Comments Blog, Customer Service, Lowell's

OK, so 'hate' is a strong word for it.

But as much as we try to be the best mechanic in Lexington, we know we're not perfect.  We know that there must be some parts of your experience with us which could be better.

So tell us.  Let us have it.  We can take it.  And we need it.

To get the conversation started, here are some aspects of our business you might want to riff on:

  • Our location
  • Our pricing
  • Our service
  • Our website
  • Our blog
  • Our lobby
  • Our restroom
  • Our people
  • Our honesty
  • Our attitude
  • How we checked you in
  • How much time we took
  • How well we explained what we did
  • How we checked you out
  • Something we did
  • Something we didn't do
  • Something we should do

Please let us know how Lowell's can get better.  Use the comments section below, call the shop at 233-1173, or email us at lowells [at] iglou [dot] com.

We can't promise we'll do everything you suggest, but we will work to make your overall experience with Lowell's a better one.

And thank you.

[where: 111 Mechanic St., Lexington, KY, 40507]

Why CentrePointe will fail

Rob Morris 3 Comments CentrePointe, Community, Neighborhood, Predictions, UnTower

CentrePit A few months back, I openly wondered about the viability of the CentrePointe project, which thus far has only managed to crater an entire city block of historical buildings.

Since our post (which came long after the controversy started), there has been a continued flurry of discussion around CentrePointe in the community.  But nothing has happened on the construction site. 

In all of this turmoil, one fact has become crystal clear: CentrePointe will fail.

The project will fail in one of two ways:

  1. The project will fail to be constructed, or
  2. The project will be constructed, and then fail financially

I say this not out of emotion or disgust aimed at the project, the developers, the mayor, or their conduct (although all may be worthy of disgust) – but because the justifications for the project fail to stand up to basic business logic.

Instead of acknowledging the flaws in their business plans, CentrePointe's developers have continually invoked wishful thinking to rationalize their actions. 

I've seen this kind of fatal optimism in business many times before.  Business executives often think they can make a project succeed by just wanting it badly enough.  (Unfortunately, optimism isn't a viable business strategy.)  In their blind pursuit of their goal, they disregard the facts. 

So, lets explore the facts around CentrePointe ('CP' from now on), which really can't be ignored any longer.  (Read more from the Herald-Leader here, here, and here.)

  • CP has had an unnamed international financier who committed $250 million to the project.  This week, we learned that the mystery investor died.  Without a will.  The project certainly won't commence until a) the financier's estate goes through probate court, and b) the heirs agree to continue support for CP.  Odds the financier ever existed: Iffy.  Odds heirs will support CP: Doubtful.
  • CP is supposed to house a J.W. Marriott luxury hotel.  Meanwhile, Marriott's CFO (who is their soon-to-be CEO President and COO [correction]) has repeatedly announced that even the best projects – a group that CP cannot possibly belong to (see more below) – are stopped in their tracks.  Odds Marriott will end up in CP: Doubtful.
  • The Marriott would have 250 rooms going at $190 per night.  The price is 50% higher than competing hotels, yet the developers' analysts estimate occupancy rates at startup which are better than those (less expensive, more established) hotels.  Odds of getting higher occupancy at a much higher price: Very slim.
  • There are 91 luxury condos at the top of CP, which would sell for $1.2 million each and which would generate over $100 million for the project.  The analysts estimated that 45 of those would sell before construction starts.  And all 91 condos would be sold in 3 years.  In all of Lexington, there were 31 million-dollar properties on the market at the end of 2008, and only 10 such properties sold during the entire year.  So… CP's developers would flood the market with luxury properties — essentially quadrupling the number that are on the market — and expect to sell them faster than historical rates.  Odds that Lexington could absorb a 300% increase in ultra-luxury properties in only 3 years: Zero.
  • CP's developers have to sell 4.5 years (45 condos at 10 condos per year) worth of luxury property inventory before construction starts.  And that assumes that every million-dollar prospect would prefer to live in a 2700-foot high-rise condo instead of a country estate. Odds that CP's developers can sell 45 million-dollar condos before construction starts: Zero.  (Note: This week, CP's developer claimed that 61 of the 91 condos were 'spoken for'.  This is patently false, and reveals a worrisome desperation from the developers.  Unless 'spoken for' means that someone said "I wish that I could live in a place like that…"  Which is also worrisome.)
  • CP's analysts assumed that the $1.2 million condo buyers would have an average income of $220,000.  That's an incredibly aggressive price-to-income ratio of nearly 6, which ranks with inflated San Francisco, New York, San Diego, and Los Angeles averages – before the real estate bubble burst.  Snakebitten banks are much more critical of an applicant's ability to pay in this economic environment.  Lexington's average price-to-income ratio: 2.35 – indicating an income of over $500,000 to afford the condos and drastically limiting the pool of eligible buyers.  Odds of finding enough eligible prospects in Lexington: Very slim.

So what are we to conclude about CentrePointe from these facts?

  1. The developers' tendency toward secrecy and intrigue are unacceptable in light of the public investments in and public impacts from this project.  We deserve transparency.
  2. The project is not financially viable.
  3. The primary financing (if it even exists) is shaky at best.
  4. The analysts' projections are unrealistic and misleading.
  5. The project cannot generate the promised tax revenues.
  6. The developers are prone to either fantasy and/or outright deception; either case bodes poorly for the feasibility of the project.
  7. CentrePointe will fail.  Miserably.

Lexington must now accept the failure of CentrePointe and begin to move beyond the CentrePointe fallacy.  We must hold accountable those who recklessly ramrodded the flimsy development through our city council.  We must prevent future irresponsible allocations of our common wealth.  And our community and our public officials must begin carefully contemplating what's next for the block that CentrePointe obliterated.

Update 4/13: Crossposted to Ace Weekly as "Optimism is Not a Business Strategy"

Update 4/14: Tom Eblen did an excellent parody of the CentrePointe situation here.  Very cool.

Update 4/17: OK.  Let's just get the whole story out on the table.  The UnTower Manifesto: What went wrong, what to do about it, and what to do about the scar it left on our city.

[where: E Main St & N Limestone St, Lexington, KY 40507]

Lowell’s Bluegrass Vehicle Report

Rob Morris 1 Comment Auto Industry, Bluegrass Vehicle Report, Community, Lowell's, Toyota

Today, we are pleased to release the Bluegrass Vehicle Report 2009.  Using state registration data, Lowell's compiled statistics on vehicles in seven Bluegrass counties.  We've put the results together in a fun and informative format which shows details about the automotive marketplace in and around Lexington.

In addition, Lowell's is releasing Lowell's School Tools.  School Tools is a companion guide to the report which helps teachers, parents, and student create their own fun and interesting findings from the automotive data.  More about School Tools can be found here.

Among the more interesting results from the Report:

  • Toyota is the #1 brand of vehicle in Lexington.  The 33,624 Toyota vehicles on the road put Toyota ahead of both Ford (31,018) and Chevrolet (29,712).  Toyota nameplates are on 15.4% of the cars on the road.
  • A lot of Toyotas.  All of those Toyotas, placed end-to-end, could fill all 4 lanes of New Circle Road, completely encircling Lexington.
  • A lot of gas.  Lexington drivers consumed over 156 million gallons of gasoline in 2008 — more than enough to fill Rupp Arena from floor to ceiling.

You can see all of the results here:

Bluegrass Vehicle Report 2009

View more presentations from Rob.

Or, you can download a PDF of Bluegrass Vehicle Report 2009 (1886.4K).

[where: 111 Mechanic St, Lexington, KY 40507]

Lowell’s School Tools

Rob Morris 0 Comment Bluegrass Vehicle Report, Community, Fun Stuff, Lowell's

Lowell's is pleased to release School Tools, which is a companion guide to the Bluegrass Vehicle Report.  School Tools is designed to help teachers, parents, and students develop their own interesting real-world insights about cars in the Bluegrass.  Along the way, they will engage their skills in research, creativity, and applied mathematics.

The School Tools guide is meant as a starting point – please adapt it to your particular needs and the particular aptitudes of your students. 

School Tools is free to teachers, parents, and the general public.  All we ask is that you give us suggestions for making it better, and that you share your stories about how you used School Tools.  We can't wait to see what you do with it!

School Tools 2009

View more presentations from Rob.

Or, you can download a PDF of School Tools 2009 (5804.0K)

[where: 111 Mechanic St, Lexington, KY 40507]

Toyota is the top brand in Lexington

Rob Morris 0 Comment Bluegrass Vehicle Report, Community, Toyota

On Thursday, Lowell's will release the Bluegrass Vehicle Report, which will look at the kinds of cars central Kentuckians drive.

One surprise finding:  Toyota is now the top brand (or "make") of vehicle on the road in Lexington, surpassing both Ford and Chevrolet.  Obviously, as Toyota specialists we're pleased.

We'll have all of the details in the Report later this week.

[where: Lexington, KY]

Dealership troubles

Rob Morris 0 Comment Auto Industry, Business, Dealerships, Predictions

In January, the Wall Street Journal ran a page one story about the troubles facing two dealerships in southeastern Kentucky.  One of them, Johnny Watkins, had filed for bankruptcy.

At the time, we predicted that there would be a lot more dealership closures in 2009, especially in smaller towns. 

MaysvilleFordAuctionThen, a couple of weeks ago, we received an auction notice to liquidate the assets of Maysville Ford.
 
Why is this happening to dealers in small towns?  There are a few key reasons:

  • There really isn't enough critical mass of car sales to support a dealership in a small town.  So dealers have to draw customers from nearby cities, usually with discounts that squeeze their profitability.
  • The most profitable part of the dealerships come from service to vehicles after the sale.  When out-of-town customers purchase from a small-town dealer, they tend to have their cars serviced somewhere else, as the dealer is too inconvenient for frequent maintenance.  So small-town dealers lack the service customers that larger dealers have.
  • The heavy reliance on car sales (and the lack of substantial service sales) means that small-town dealers are much more sensitive to economic downturns.  As car sales plummet, the service business is what has sustained many big-city dealers.  The smaller dealers just don't have that cushion.

The economic realities of being a dealer in a small town mean that a lot of them won't survive over the next couple of years.

[where: 41056]

Service Hero: Chili’s

Rob Morris 1 Comment Business, Customer Service
Part of our Customer Service Hero, Zero, or Nero series.
Heroes really care about customers and create surprise and delight.

A few years ago, Chili's really ticked me off.

Because of our careers, my wife and I ate out a lot.  (We still do.)  And Chili's had my favorite meal, a dish they called 'Margarita Grilled Tuna'.  I had eaten it every week or so for some 5 or 6 years.

Then it disappeared from the menu.  (Editorial comment: Booooooo!)

I tried to stay away from Chili's in protest, but my wife dragged me back in.  Eventually, I found some other things I liked eating there, but nothing ever compared to that tuna…

Chili's continued to be part of our regular rotation of restaurants after our son was born.  And, with his magnetic personality, several wait-staff members would go out of their way to come visit with him.  The greeters and managers began recognizing us as well.

When we walked in last night, the greeter proclaimed "There's my buddy! How's Mr. Carson tonight?" and exchanged high-fives with him.  She took us to our 'regular' booth (in reality, we have eaten all over the restaurant, but we do prefer the booths).

Alex, who wasn't our server last night, came over and double-high-fived Carson, and talked with him for a few minutes.

Neil, the general manager, came over and gave him a big hug and called him by name.  He also brought a Chili's ball cap, and gave it to Carson to wear.  On previous visits, Neil has also brought us a complementary slushie and has introduced Carson to Neil's own daughter.

CarsonChilisLast night, he asked if he could take Carson's picture for the office wall, because "seeing Carson only once a week just wasn't enough".  15 minutes later, he brought out a 4×6 print for us to keep.  Carson was beaming.  (My scan doesn't do the original photo justice.)

On the way out, Carson gave Neil another big hug and waved goodbye enthusiastically to the other staff members.

Eating out with a toddler can be a challenging experience.  At Chili's, the staff's willingness to engage Carson has helped keep him occupied and entertained.  That's a big bonus for parents like us.

But what makes the experience truly special is the sense that we are among family and friends.  Carson is greeted with genuine joy by the Chili's staff.  They are happy to have us come back.  And, as a result, we are happy to go back.

For Carson, these kinds of interactions have made Chili's one of only two restaurants he knows by name: "Chih-wee's".  (The other is "Chick-foo-way".)

Can I recommend every Chili's based on our experiences?  No.  Over at the Brand Autopsy blog, John Moore openly wondered why Chili's needs to exist.

But I can heartily recommend our Chili's.  Even without the tuna…

A Few Lessons for Business

  1. Relationships matter.  We have come to see Chili's as a kind of extended family.  Out of the dozens of companies you interact with, how many businesses can you say that about?
  2. Relationships take time and patience.  Real relationships aren't built overnight.  If Neil had started snapping pictures of Carson the first time we met him, we would have been creeped out.  Because he had earned our friendship and trust over a series of interactions, we didn't mind a bit.
  3. Relationships require genuine familiarity.  Fake familiarity doesn't work — customers will see through that as shallow.  But when the Chili's staff remembers our names (well, OK, Carson's name) and our preferences, that shows a level of caring, concern, and memory which is lacking in most business interactions.  Neil, Alex, Tina, and the rest of Chili's staff have shown a genuine interest in us and our child, and have earned our trust and loyalty.
  4. Be happy to see your customers.  And make sure your staff is, too.
  5. Leadership matters.  Neil's outgoing approach and enthusiastic attitude has infected his staff, who reflect the same personality.  Speaking from experience, it is really easy to get stuck in the office.  Neil gets out of the office to talk with his people and his customers.  And it really works.
  6. Kids matter.  As a parent, when a business goes out of their way to show that they care about the experience they create for my child, they win my loyalty.  Be a kid's hero, and you'll be their parents' hero, too.
  7. The product still matters.  You might notice that I haven't mentioned the food last night.  It was good.  And a good product is the first requirement for a good experience – that's why the customer is really there to begin with.  Wrapping a great experience around an awful product will ring hollow for the customer – and they won't be back.
  8. Margarita Grilled Tuna matters.  Bring it back.  Please.

[where: 2851 Richmond Rd, Lexington, KY 40509]