Raleigh's largest office landlord is trying to save Fayetteville Street
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Raleigh's Fayetteville Street. Photo: Courtesy of VisitRaleigh
When Michelle Woodward, the founder of the local salads-and-bowls restaurant Diced, was thinking of expanding her young business, downtown Raleigh was not on her radar at all.
- But now hers is one of several restaurants that have opened on Fayetteville Street in the past year, as part of an intense recruitment effort by the region's largest office landlord Highwoods Properties, which has offered favorable deals to several businesses in the hopes of boosting foot traffic.
Why it matters: Highwoods Properties, a Raleigh-based publicly traded real estate company, is trying to lift Fayetteville Street, downtown's main business district, out of the doldrums it fell into during the pandemic.
- It's done so by investing significantly in renovating its portfolio of office towers on the street and making it less risky for restaurants to build out and rent space on the street.
State of play: Highwoods essentially owns Fayetteville Street, with a portfolio that includes some of downtown's most prominent buildings, including 150 Fayetteville, PNC Plaza, One City Plaza and Charter Square.
- "We want to put our money where our mouth is by coming downtown," Brian Leary, Highwoods' chief operating officer, told Axios.
Driving the news: Diced, which opened in October, has been joined by a group of other Highwoods recruits, including Chido Taco, PrimoHoagies, Insomnia Cookies, Birdie's Barroom and Kitchen and Sir Walter Coffee + Kitchen.
- There's more to come, too. Highwoods is in the process of rethinking the four restaurant kiosks it owns in City Plaza, Leary says, as part of a potential refresh of that part of Fayetteville Street ahead of the construction of the Omni Hotel.
What they're saying: "We wouldn't have looked at downtown" if they hadn't reached out to us, Woodward said of Highwoods recruitment, noting they wanted a healthy option on the street. "I've always had the thought that our model works best in the suburbs."
- Wary about opening downtown, Woodward had thought it would be hard to hire and that the offices weren't full enough to bring in business.
- But so far, hiring has gone well (she credits a nearby bus stop and parking passes from Highwoods as helping).
- And "lunch has been amazing," she added. "It's our busiest store, actually, for lunch," while dinner remains softer.
Zoom in: The biggest examples of Highwoods' commitment to the street can be seen in the 150 Fayetteville tower, previously known as the Wells Fargo tower before the bank decided to exit the building.
- First, Highwoods moved its corporate headquarters from just outside the Beltline to the former Pendo office space at 150 Fayetteville.
- Second, it partnered with LM Restaurants to open Birdie's, putting significant capital into renovating a former Carolina Cafe space into something Highwoods thought was missing on the street: an all-day cafe and restaurant that could do everything from coffee and pastries in the morning to work lunches and dinners or just a place to grab a drink at night.
- Additionally, Highwoods overhauled the building's outdoor plaza, transforming it from a concrete slab into a spot with turf grass and tables, chairs and a stage, plus public art.
Highwoods says it's already seeing returns.
- Smith Anderson, the Triangle's largest law firm, recently grabbed more space in the building, going from five floors to seven and taking over the former City Club space, according to the Triangle Business Journal.
- "The first 20 feet of the building sells the rest of the building," Leary said of the need to revamp Fayetteville Street's ground level.
What's next: Leary, the former CEO of Atlanta's BeltLine and backer of Interface Studio's plan for revitalizing downtown, said this is just the beginning stages of revitalizing downtown Raleigh's historic core.
- Leary lauded the city's looming investment into a new convention center and luring of the Omni Hotel to Fayetteville Street.
- But he's hoping the city will come through with even more significant investments, whether that is improving street lighting and artwork, improving its sidewalks or swinging big on additions to public spaces like Nash Square or better connections to Dix Park.
The bottom line: "Show me a city investing in its infrastructure, and I'll show you a city that's winning," Leary said.