Following the Pizitz Building’s Second Avenue North reopening on March 17, the Pizitz Food Hall has offered local culinary entrepreneurs the opportunity to test markets with low-stakes investment and long-term benefit. In partnership with the city of Birmingham, Bayer Properties and associated contract groups have worked to make an economic springboard a reality.
Long-time residents may be familiar with older efforts to restore the Pizitz building that went uncompleted. In 2008 Bayer Properties secured the space for development of a mixed-use building, adding office space and commercial businesses to the former Pizitz site. When the 2009 recession pressured the real estate and money-lending industries, the future Pizitz project fell by the wayside.
“In 2008, the world kind of fell apart, and our anchor tenant lost their term on their lease,” said Tom Walker, the development manager for Bayer Properties. “The project was put on hold; it was really hard to get anything financed. Everybody went into their turtle shell from a lending standpoint. … We just ran out of time.”
Years later, redevelopment resumed with a stronger economy. This time, the city of Birmingham was willing to aid in financing the project. “One of the major differences was receiving tax credits that were a part of the capital stack,” said Walker. “This represented significant equity [offered] into the project. It helped bridge the gap between ground-up building construction and what resulted, which is significantly more expensive.” Because of the project’s potential to generate greater economic activity downtown in the long run, the city of Birmingham contributed considerable infrastructure to renovating the streetscape adjacent to the Pizitz.
Director Lisa Cooper of the Mayor’s Office of Economic Development said the project is “like a gateway,” from the city’s perspective. “We know that the project was definitely catalytic,” Cooper said. “It formed a spark for further development in the area right around the corner. People find interest in these mixed use ventures … that will continue to revitalize economic vitality and encourage investment into other development projects.”
The Pizitz reconstruction was enabled by a $1.9-million block grant from the city for repair of the infrastructure. Additionally, the city facilitated tax abatements for the purchasing of construction materials used in the building process. This time, the Pizitz secured tax credits as a historic building, which proved to be a major catalyst in finally financing the Pizitz.
“When the project was initially proposed, they had trouble with much of the financing,” said Cooper. ”They wanted to make sure they were included in historic building tax credits.” HUD-108 loans from the federal Department of Housing and Urban Development also financed the project, alongside contributions from city community-building groups like the Downtown Redevelopment Authority.
“The city invested a tremendous amount of time and effort to make sure that we navigated the permitting and inspection process successfully,” Walker said. “Because construction always operates on an ASAP delivery date, … the city of Birmingham was really accommodating to us, and was really our partner for the entire project.”
The result of this public-private sector partnership was a mixed-use space that provides a springboard for rising entrepreneurs in Birmingham business to work upwards from the retail space, as well as a cultural hub for Birmingham foodies.
Create Birmingham director Buddy Palmer explained that the Pizitz “gives other aspiring entrepreneurs a step where they can start. … They can improve and provide the greater community with opportunities to explore other cultures and foods. … It shows that we are an evolving, progressive community, that we are open to other cultures and to other adventurous new opportunities.”
REV, in partnership with Create Birmingham, operates the Reveal Kitchen in the Food Hall of the Pizitz. Reveal Kitchen is a temporary kitchen space where alumni of the CO.STARTERS program, a business management workshop run jointly by REV and Create, operate for four to six months. The space serves as a proving ground for new Birmingham culinary entrepreneurs to test the market before financing any large-scale restaurant ventures.
“Without sinking too much money into an idea that may or may not work, or a good concept with something that needs to be tweaked, … we want to make sure that risk is minimized and everyone is on the right track,” says REV Director of Business Growth Deon Gordon.
Reveal Kitchen applies this logic to Birmingham food culture and the restaurant industry as a whole, in which uncertainty and risk are inherent. “So we did a similar thing with [current tenant Gabriel Marrero] of Tropicaleo, who won The Big Pitch last year in 2016,” said Gordon. Tropicaleo is a traditional Puerto Rican restaurant currently operating out of the Reveal Kitchen space.
For residents and leaders like Palmer, the reopening of the Pizitz represents a growth in both entrepreneurial and cultural awareness which has been elusive for Birmingham. “There is exploration to be had [in Birmingham]; [the Pizitz] is a sign of progress for a city that once upon a time was defined in terms of ‘food culture’ as one Chinese restaurant downtown,” said Palmer. “This is a big step — not that the Pizitz is our first exposure to diversity and culture, but it’s nice that [Pizitz] is a compact platform where [customers] can sample many different things in one place.”