Oklahoma City residents and visitors to the state’s capital are certain to notice the construction downtown. Fewer people, though, might be aware of the impetus for or the scope of the construction and renovations taking place in a large chunk of the city’s once nondescript urban core.
“Oklahoma City is going to have a brand new downtown,” says Roy Williams, president and CEO of the Greater Oklahoma City Chamber of Commerce. “Everything from building fronts to sidewalks, landscaping, benches – all new, more than 56 blocks of downtown. And at no cost to taxpayers.”
Williams and city residents and municipal leaders are all excited at the prospects of a “new” downtown, covering 180 acres and funded by the development of the new Devon Energy Corp’s new Devon Tower corporate headquarters.
The Devon Tower project itself, already towering over downtown, is enough to generate excitement.
“We have an economic impact model but we haven’t run it yet,” Williams says. “But the impact is pretty phenomenal, from many standpoints. The building itself is a $750 million project, with thousands of workers. Then it has to be furnished and maintained. Those first-day capital expenses filter through the economy. Then there’s the growth from payroll and all of the indirect spending related to the project.”
Devon Tower will be the largest building in downtown Oklahoma City and in the state, and Williams adds that it could well be the tallest building currently under construction in the country.
Oklahoma City Mayor Mick Cornett says the economic impact was felt immediately.
“Since construction began, we’ve made consistent strides in sales tax,” Cornett says. “A lot of people are working in the building, patronizing restaurants and hotels – in addition to the supplies being bought.”
Certainly the single project is having and will continue to have a tremendous direct economic impact in Oklahoma City. Cornett points out that both Chesapeake Energy and SandRidge Energy are also investing in downtown corporate campuses, which further has additional effects.
Devon Energy Executive Chairman J. Larry Nichols says that the most important thing about the new corporate campus is that finally all of Devon’s Oklahoma City staff will be under one roof.
“We needed the building because of growth,” Nichols says. “Our people have been scattered among five or six buildings around town. This enables us to centralize everything, to have all of our people in one space and with plenty of room for expansion. We’ll have our own dedicated parking garage, fitness center, meeting space and conference space. It will be the most efficient thing for our employees.”
But Devon Tower’s footprint in the city exceeds the site it occupies and revenue it helps generate. Due to an agreement with the City, it will also directly benefit Oklahoma City in the form of a veritable facelift.
The plan, Nichols says, stems from tours of the city he conducted with architects and landscape architects who worked on the tower.
“It was interesting because on one hand they were impressed with what Oklahoma City had done with buildings,” Nichols says. “But they also pointed out that the public components were antiquated and chaotic.”
Nichols then approached the city to discuss establishing a Tax Increment Finance zone in the vicinity of the new tower. The TIF allowed the tax boon from the tower’s development to be utilized to rebuild sidewalks, reconfigure streets, create public spaces and landscaping improvements, as well as other improvements. Dubbed Project 180, the TIF plan is going to raise $175 million over the course of its 25-year term – all for public improvements in a 180-acre area downtown. Considerable investment is also being made in Myriad Gardens, one of Devon Tower’s neighbors.
“The city was thrilled,” Nichols says. “I’ve never known a city to be able to do an entire downtown in one fell swoop.”
Cornett says that negotiations were “very respectful.”
“Both sides wanted to have something,” he continues. “We created a downtown they wanted to locate to, and they want to have an impact there. Both sides were happy.”
Nichols says that Myriad Gardens is going to be complete this fall and that the downtown improvements will be in the works for another two to three years.
“One thing we wanted was to be able to do this at one time,” Nichols says.
In addition to new sidewalks and other infrastructure and green spaces, Project 180 will see traffic realignment as streets are adjusted to better the flow of traffic.
“They’re building us a whole new downtown,” Williams says. “There will be multiple economic impacts. Then there is also the image impact. People flying into Oklahoma City will see this huge building, lighted at night. It’s impressive.”
Williams says that as a result of the work Devon Tower is funding, he is already aware of other companies investing in downtown with plans to bring employees to the city and to hire yet more.
Both Cornett and Williams believe that the “new” downtown will be more walkable, more amenable to bicycling, and more pedestrian friendly in general.
“I think the number of people who live in and visit downtown will increase,” Cornett says.
Historically, downtown residences are key to a vibrant center city, and Cornett says that he thinks that there is market demand for additional housing downtown.
“I just don’t think there is enough entry-level housing, but I believe demand is there,” the mayor says.
Current downtown property owners will benefit from enhanced property values, Williams says, and locals and visitors will have the added value of restaurants and retail located on the ground floor of Devon Tower and the parking garage.
The pubic will also be able to enjoy what promises to be a spectacular view from atop the 50-story tower.
“The top two floors are going to be a restaurant and bar,” Nichols says. “We realize a lot of people would want to get to the top of the building and see what the view from up there looked like.”
Nichols says the topping off of Devon Tower would occur in mid-December and that employees would start moving in lower floors in February 2012.
“Downtown is continuing to develop,” Cornett says.