Developers for the massive Downtown South project in Raleigh received a critical rezoning approval by the City Council on Tuesday, just days before they say they would have abandoned the project.
The new zoning opens the door to massive development of 145 acres of mostly undeveloped land along South Saunders Street. When fully built out, Downtown South could include millions of square feet of office and retail, thousands of residential units and hundreds of hotel rooms, all anchored by a 20,000-seat soccer and entertainment stadium.
Importantly, the rezoning is just that; it does not include any public money for the project, though developers are seeking that as well. Those discussions will take place over the coming months. The developers are Steve Malik ― owner of the NC Courage and North Carolina F.C. professional soccer clubs ― and Kane Realty, developer of North Hills, the Dillon, and more. The Courage play in the growing National Women's Soccer League, while NCFC plays in the USL Championship, the second-tier of men's professional soccer in the U.S.
Supporters of the $2 billion project say it will bring badly needed economic activity to a part of Raleigh that has historically not received as much investment as other areas. Critics say it will cause gentrification, and cause other negative effects, notably flooding from stormwater runoff, to surrounding low-income neighborhoods.
While the Raleigh Planning Commission ― the council's top development advisory board ― voted unanimously to reject the rezoning, the council reversed that decision, voting 7-1 to approve. Councilman David Cox was the only dissenting vote. This council has been vocal about affordable housing needs in the city and acknowledged that Downtown South would likely displace low-income residents, but added that rejecting the development would be worse for the city as a whole, and that the city can use some of the increased tax revenue to offset negative impacts.
"This is a moment that really is about the future of Raleigh," Mayor Mary-Ann Baldwin said. "We are going to hold the development team accountable. We expect some great things; we want to see great things. And we're counting on all of you to work together with our community to make it happen."
The council can't stipulate any conditions as part of a rezoning approval, though the applicant can offer conditions in an attempt to gain favor. The developers offered a proposal to mitigate stormwater runoff, and promised to hold aside 100 of the first 1,000 residential units as affordable, meaning they would be set aside for households making 80% or less of area median income. But those units will be set aside for a minimum of only five years. ONE Wake, a group that advocates for a more equitable Raleigh, demanded 299 units set aside for 15 years.
The council can consider other conditions as part of any tax incentives or grants it might offer in the future.
A more than two-hour public hearing took place before the council voted. Those in favor and opposed to the project each received an hour to state their claim. Those in opposition largely said they weren't against development in this part of town, but that they opposed this project in particular out of fears of the negative impacts on surrounding areas.
Bonner Gaylord, a former Raleigh council member and Kane Realty managing director of operations, dismissed the criticism.
"What you've heard tonight from our opponents is a series of misinformation, misunderstandings, conspiracy theories and personal attacks, which I won't address," he told the council after the public hearing. "What you've heard from our side is a series of neighbors, community leaders, neighboring businesses, neighboring nonprofits, neighboring churches, and neighboring academic institutions who all are standing up tonight before you, declaring that this project is reasonable, in the public interest, and desperately needed."
Councilman Corey Branch is a Raleigh native and has advocated for minority communities. He said he thought about his 2-year-old daughter, his 5-year-old niece, and 13-year-old nephew when considering approval.
"What Raleigh are we leaving them?" he asked. "Is this project perfect? I'm going to tell you: 'It's not.' If we wait for a perfect project, as some of the elders would say, we'll be waiting for the roosters to come home."