Going Postal

Maybe its time to revisit Steve Stogels redevelopment plan for the Old Post Office downtown

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It wasn't always called the Old Post Office. When it was completed in 1884, the storied downtown landmark at 815 Olive Street was known by residents of the tony neighborhood around it as simply the Post Office. By the thousands, people passed through its revolving doors to do business with the U.S. government -- to pick up their mail, perhaps, or make their way to one of the grand third-floor courtrooms. They came to meet with federal bankers and IRS officials, to consult with U.S. Army engineers or lighthouse and steamboat inspectors.

But by the mid-1960s, the U.S. Post Office and Custom House, designed by famed architect Alfred Bult Mullett in the proud, rigid French Second Empire style, was already a "useless pile of wretched architecture," according to the St. Louis Globe-Democrat, which sided with City Hall, the chamber of commerce and real estate agents in a campaign to demolish the structure and build a plaza and a modern office tower in its place. Pitted against these groups were the Landmarks Association, a St. Louis architectural heritage watchdog group; the Post-Dispatch; and a phalanx of area preservationists. Heritage won out, and in 1968 the Old Post Office was placed on the National Register of Historic Places. It has stood nearly empty ever since, one of the most majestic pigeon roosts in the country. It's too exquisite to destroy, say developers who have eyed the site for years, but too colossal to survive -- unless it's given room to breathe.

For the past three years, the city has backed a $73 million redevelopment plan for the Old Post Office, the brainchild of developer Steve Stogel, co-founder of the DFC Group, and Mark Schnuck, president of the DESCO Group, the real estate arm of the Schnuck family's grocery-store empire. (Mark Schnuck declined to be interviewed for this article.) That plan would resurrect the Old Post Office and restore it to a place of primacy in downtown St. Louis. Within a few months, "late this quarter or early next," predicts Stogel, if there are no hitches, the two developers, along with two banks, will hold a 99-year lease on the building, which would be elevated to national monument status. The Old Post Office's 50,000 square feet of usable space would house not only the Missouri Court of Appeals but perhaps a new campus for Webster University, plus stores, restaurants and coffee shops, and possibly brokerage and legal firms. The renovated structure would, the developers say, turn the city block on which it sits -- and the blocks radiating from it -- into an upscale urban oasis for convention visitors and sports fans and lure residents back to downtown. It's part of a comprehensive plan, says Stogel, to revive the entire district.

But there are hitches: protests from downtown residents and area preservationists, accusations of strong-arm tactics against business rivals and political quid pro quo, and a lawsuit that has intensified public scrutiny of the deal.

Across the street from the Old Post Office sits the Century Building, another relic from the city's architectural heyday -- a ruin now, but significant and unique enough to also earn a place on the National Register of Historic Places. The Century Building, built in 1896, must come down, according to the developers and financiers (and their backers in city and state government), or their key tenants won't sign on and the whole deal will collapse. The square, they maintain, needs a parking garage. The developers themselves need parking right next to the Old Post Office for 1,050 vehicles, as stated in the plan they introduced three years ago that features a nine-story Ninth Street parking facility. They also want to add more street-level retail to the ground floor of the Old Post Office.

But while the developers' plan hasn't changed in the past three years, the downtown district has evolved. The district is teeming with available properties that could house a parking garage, say critics of the plan, and, equally important, downtown is already well on the road to revitalization. It's not too late to reconsider the Century Building's demolition, they argue: The assumptions of 2001 no longer apply, many nearby buildings have changed hands in recent years, and long-rumored developments are actively under way. Some of the area's most prominent developers -- the Roberts Brothers, Pyramid Construction and Amos Harris -- are renovating properties around the Old Post Office. Redevelopment is inching its way eastward from loft central (Washington Avenue west of Tucker), to the successful Merchandise Mart, to developer Craig Heller's Tenth Street Lofts. Many of the downtown developers counter that these residential developments are a bellwether and that their new tenants will need goods and services. They're in agreement with Stogel: The district can't succeed without the Ninth Street parking garage.

The Landmarks Association nonetheless continues its fight to preserve a piece of architectural history. It supports an alternative recommendation, put forth by the city itself in 1999, two years before the introduction of Stogel's plan. At that time, the city called for restoration -- not demolition -- of the Century Building, which it owns, and urged that planners maintain the district's character by looking for above-ground parking in areas that did not directly front the Old Post Office.

No one can tell by looking at it, but the Old Post Office was built atop quicksand. As the building was being constructed in 1873, workers setting its foundation struck an enormous pit of quicksand, and 800 men struggled to stem the flow. Ultimately they succeeded, but not before, the story goes, tossing in 500 bales of cotton, driving huge pine support beams deep into the bedrock and covering it all with granite slabs.

"They don't make them like this any more," declares 55-year-old Steve Stogel as he tours the building, "and with good reason." He's walking through a vast corridor, his footsteps echoing off of the intricately patterned floor tile, still in pristine shape after 120 years of use. "This building has received love and attention," he says, explaining the frustrations of filling the massive structure with tenants. It's not the most cost-effective space: Some ceilings soar to 35 feet high, and the spacious corridors will be expensive to heat and cool. "It was designed to be a government building," he notes, counting off the Old Post Office's previous tenants -- the U.S. Postal Service, the Treasury Department, the U.S. Attorney's Office, the District Court. "That's what this thing was built for. Take that and adapt it to a 21st-century office building, and find good tenants that are compatible." He pauses. "It's hard. It's a hard, hard deal. It takes the commitment of a whole town to save a building like this." The key, he explains, is to once more fill the monolith with institutional tenants, those who will commit to occupying the building for a long time.

The Old Post Office Square district, Stogel likes to say, is "the living room of downtown," and the block he wants to renovate is the most important development project in the city right now: Its success will boost more than just the surrounding area. "St. Louis will have a much more vibrant downtown, and the place will feel better when the conventioneers come out of the hotels and walk to the ballpark. You'll see more pedestrian traffic everywhere. It'll feel better, and I'm looking forward to it -- because we'll no longer have a shabby living room."

Nearly a quarter of the city's vacancies -- some 2 million square feet, according to Stogel -- "are in the living room of downtown," he says. "What do you do to make the living room not shabby? You have to lease it to a vibrant community. So we came up with a plan for the whole district." Likening the Old Post Office to the center of a doughnut, he states, "You have to fix the core of it before you can fix the other stuff. Because I don't believe you can fill the edges of a doughnut before you fill the center of a doughnut."

Meaning, of course, that the Century Building must go: "If you're going to lease the rest of this building, you can't lease it looking into vacant, pigeon-filled, broken glass windows."

Stogel, who got his start in the mid-'70s with area developer McCormack Baron and bought half-interest in the company in 1981, credits his experience there with his mastery of the intricacies of public-private development partnerships. He traveled around the country -- to Ohio, Kentucky, Virginia, New York, Connecticut -- putting together such deals. "We basically found a way to meld different sources of public and private financing to complete complicated projects," he says. He left McCormack Baron in 1990 to head the St. Louis Technical Assistance Corporation, or TAC, which was created by Civic Progress, a nonprofit service organization of chief executives from local corporations whose purpose was "to help then-troubled projects and 'stuck' projects that then-Mayor [Vincent] Schoemehl was interested in." Through TAC, Stogel worked as a financial advisor in the deal that ultimately created the Renaissance Grand Hotel on Washington Avenue and its accompanying parking lot and the Gateway Mall project. TAC also helped finance the ArtLofts, the first Washington Avenue loft development. In 1994, he founded the DFC Group with partner Chuck Eveker. "It stands for Don't Fool Chuck," laughs Stogel, explaining that it's a reference to his partner's accounting acumen.

Artist and Washington Avenue investor Bob Cassilly, owner of the popular City Museum, has had his share of tangles with Stogel (who is a former museum board member) but admires his drive. "He's brilliant when he starts putting things together. You can see him when he's making deals and stuff -- his feet start tapping on the floor and his mind's working, and he comes in with these wild associations."

Cassilly recalls the first time he and Stogel met: "I was doing these lions for the Gateway Mall, and I had all these downtown people come into my studio to find out if they really wanted to put them in the mall," he says. "Steve walked in -- the first time I ever met him, and before he even saw them -- and said, 'I want to tell you up-front that I'm going to do everything in my power to block these things.'" Despite his opposition to Cassilly's sculptures, which were ultimately approved, Stogel didn't mince words. "I was always impressed with how up-front he was. And he can get in your face and apparently will make people cry and things like that."

The partnership required to renovate the Old Post Office has already brought out Stogel's skill at finessing a deal and his steamroller style. The $73 million price tag ($43 million if one excludes the cost of the proposed garage) calls for the federal government's real estate arm, the General Services Administration, to deed the property to the state. The state would then lease the building for 99 years to DFC, DESCO, the Bank of America and U.S. Bank. In return, the developers would be obligated to restore, lease and manage the building until 2103. DFC and DESCO would be responsible for financing the deal; they expect to obtain funding through tax credits, debt, housing grants and donations from Civic Progress and the Danforth Foundation, a private, independent foundation with a goal of revitalizing the St. Louis region.

But critics cite concerns about Stogel's friendship with Governor Bob Holden. Stogel is a major contributor to the Democratic Party and counts U.S. Representative Richard Gephardt among his close friends. He also personally guaranteed a $250,000 loan for the governor's inauguration in 2001, a fact that detractors are quick to point out when they predict that he stands to make a hefty profit from the state of Missouri.

Moreover, detractors say they can't make sense of the city's actions with respect to the Century Building. Throughout the '90s, when the building was in private hands, its owner, developer Mark Finney, pursued demolition permits that the city repeatedly denied. But in 2001, the city bought the building and paid Finney ten times his original purchase price of $625,000 and began advocating the very thing he requested: the Century Building's demolition.

What's more, critics allege, the proposal arrived as a fait accompli, despite the city's 1999 opposition to demolition while the Century belonged to Finney. One of the most outspoken opponents is attorney Matt Ghio of the Clayton law firm Van Amburg, Chackes, Carlson & Spritzer. Ghio represents Marcia Behrendt, a downtown resident who filed suit against the city, the state, the developers and others to halt the Century's razing. Ghio maintains that the Old Post Office proposal works in direct opposition to the downtown master plan created by Downtown Now!, a partnership of private- and public-sector interests dedicated to revitalizing downtown.

When the city gave the go-ahead to renovate the Post Office at the expense of the Century, Ghio alleges, the announcement suggested that meetings had taken place about issues of "public planning, public process" -- but without public knowledge. Although Ghio says such meetings were not illegal, he complains that the developers "had been working with the General Services Administration, with the state, with the alderman, with Gephardt, with [U.S. Senator Kit] Bond, with [former U.S. Senator John] Danforth, [city booster organization St. Louis] 2004 and Downtown Now!. They were having all these meetings and not letting anybody in the community know that this was going on, and that's what I think angered a lot of people. This is a very prominent block in a very prominent square. And then they decide unilaterally to change [the city redevelopment plan] without trying to get any community input."

In February 2002, two other downtown developers, Craig Heller and Kevin McGowan -- both of whom have a portfolio of impressive downtown residential and retail projects -- proposed an alternate plan that would save the Century. They recommended that the building be converted into a combination of retail space and residential lofts, with parking inside the building. But the city and Stogel swiftly and vehemently opposed the idea, and within a matter of weeks, amid rumors and retaliatory threats, Heller and McGowan withdrew it. (For more, see Elizabeth Vega's "Wrecking Crew" in the March 20, 2002, issue of the Riverfront Times.)

Gwen Knight is the vice president of DESCO charged with transforming 20,000 square feet on the ground and second floors of the Old Post Office into retail and office space. As she walks through the Old Post Office's main floor, Knight points out the original, ornate post-office boxes that line one wall. "They're fabulous," she says. But she also knows the challenges ahead. Retailers will be faced with enormous utility bills for the beautiful but cavernous spaces, and they must conform to the restrictions that come with occupying a national landmark: Signs on the building would be prohibited, and any new construction work would face close scrutiny.

One challenge, Knight says, is to transform the building's exterior and make it more inviting from the street; to this end, the plan calls for trees to surround the structure, along with faux historic planters and streetlamps. "We wanted to create this really people-friendly building," she says. "That was very important to us. If we do that, we think there's a really good chance you can put some retail tenants in there. We've designed that [northwest] corner outside so you can put a nice restaurant in here and have outdoor eating. It can really be a terrific-looking building." A Starbucks or a Saint Louis Bread Co., she adds, would do well too.

When Stogel considers the neighborhood's retail character, he envisions "the kinds of things that you'll see in any major city -- financial services, coffee shops, a travel agency, a rental car company." Fast food, he adds, and a Hallmark store. A health-and-fitness center. A flower shop. "It's not going to be the art galleries like you find in Paris, and it's not going to be Madison Avenue between 72nd and 79th in New York -- Yves St. Laurent and all the fashion districts." He isn't worried about filling the two floors, even though they account for a full third of the usable space. "As the building fills up," he says, "we'll have the flexibility of going office or retail. It may end up as an all-office building, or it may end up with some retail."

Easier to bring in, no doubt, will be two institutional tenants who have already expressed an interest in the building: the Missouri Court of Appeals and Webster University. The court's 14 judges and their 40-plus staff members need more space than can now accommodate them in the old Wainwright Building, two blocks south. After touring the Old Post Office in 2001, the judges unanimously voted to move out of the Louis Sullivan-designed landmark and into their proposed roomier quarters. "They're the anchor tenant," says Stogel. "Their lease is 99.44 percent complete."

And it was the judges' decision to move, according to Royce Yeater, Midwest director of the National Trust for Historic Preservation, that was the driving force behind the National Trust's acceptance of the Ninth Street Garage plan in January 2001, and that acceptance means the destruction of the Century Building.

"I had real concerns about what was going to happen to all those old courtrooms upstairs," says Yeater from his office in Chicago, "whether one was going to turn those into condos or rent them out as office space to some attorney. Once the state courts came along, it changed the rules a little bit." The courts, he notes, are "a perfect match" for the building.

But for Yeater, it is equally important to have Webster University sign on. In fact, he included strict stipulations for the Century Building's razing, including an understanding that the National Trust's approval is off if Webster pulls out. And Webster may become a glitch; the school is no longer interested in occupying the two basement levels. Instead, it wants to lease space on the ground and second levels, which leaves the building's most unattractive areas without a prospective tenant.

The university, ironically, had designs on the Old Post Office even before DESCO and DFC started sniffing around. At one point in 1999, Webster even floated the idea of buying the building from the federal government, but the GSA wouldn't sell. Then the school, which maintains a downtown campus in the Lammert Building three blocks to the northwest, conducted "space studies" and concluded that the landmark was far too large for its needs. During any given semester, only a few hundred students are enrolled, and their impact is barely felt on the neighborhood.

Webster University president Richard Meyers wants to change that. "The university has grown to a remarkable size," he says. "It's funny to say this, but there are some areas where we are located in the U.S. and the world where we are considered a major player within those regions, and yet in St. Louis it's very difficult to get the kind of public recognition that the university gets in other places." In late September, Meyers told the St. Louis Business Journal that the number of students at the campus would start at 1,200 per semester when the redeveloped Old Post Office is complete and would, within four years, increase to 1,700. (Stogel, however, recently estimated that number at between 450 and 500.)

But Meyers has opponents within his own faculty who say the predicted enrollment numbers don't add up and that the Lammert Building has space available for expansion. Dan Hellinger, chairman of the History, Politics and Law department, has spoken publicly against a proposed move to the Old Post Office. "I think Dick's motives for going downtown, insofar as they are to participate in the revitalization of downtown St. Louis, are good ones," he says, "and I support them. However, I can say that a lot of us on the faculty, and, I know, many administrators are concerned about whether or not the financial commitment that the university may have to make is something we can afford to take on."

During the five-plus years Meyers has been promoting the idea of a move, he has changed his position from an outright purchase of the building to leasing 50,000 square feet -- and now he's cutting that number by a third. "We're looking at a reduction in the amount of square footage," he says, "in the 30,000-to-35,000 range, which would still double what we're doing now."

Meyers remains cautiously upbeat that Webster will end up in the Post Office, albeit in a diminished capacity: "I'm optimistic that something can be worked out," he says. "It's been over five and a half years now since we started this project. I still look at it as something that's going to happen. But negotiations are negotiations, and we'll just see what happens."

The Century Building and its attached-by-a-wall sister, the Syndicate Trust (which would be spared from demolition) both won designation on the National Register of Historic Places in February 2003, nearly two years after preservationists submitted the original application in the wake of the Century's demolition proposal. By the time the Century was awarded this status, however, the fate of the building seemed sealed. The mayor's office opposed the designation, but the National Register disagreed. Historic status, however, does not protect the building from the wrecking ball.

The Century is in far worse shape than the Old Post Office. The city purchased it, along with the Syndicate, from Mark Finney's Conlon Group in July 2001, and it was a shambles; Conlon had evicted the tenants and then left the building for dead, hoping to raze it for a parking lot. (The Syndicate, meanwhile, languishes, awaiting a development plan.)

"Mark Finney was the one who screwed it up so bad," insists artist and investor Bob Cassilly. "He did everything he could to destroy the building. Jackhammered a hole in the floor and pushed a Bobcat in there to show that the building wasn't strong. If there's a bad guy in this whole thing, it's Mark Finney, because he made it so that it could never be repaired."

The Century's last remaining tenant, Walgreens, bailed out in late 2002 at the city's request and, over a year later, the building continues its decay, surrounded by a plywood fence adorned with fading murals. Pigeons looking for a change of scenery from the Old Post Office leap next door to the dry-bones exterior of the Century, then to the Syndicate Trust. The inside has been gutted of every accoutrement, say those who have visited it, with walls and windows transformed into graffiti canvases.

For this reason, says preservation consultant Lynn Josse, the Century, constructed of Georgia marble and limestone, has been dismissed. Supporters of the Old Post Office plan "began with the view that the Century wasn't an important building and didn't add anything to the urban environment." Nonetheless, she adds, the Keeper of the National Register "states quite clearly that there are no other known buildings like this of these materials."

But the city argues that the landmark must come down precisely in order to preserve the downtown heritage. Deputy Mayor Barbara Geisman explained the city's reasoning to the Post-Dispatch (Geisman declined comment for this story): "By doing this garage, I think we will be able to induce development of the Paul Brown and the Arcade-Wright [buildings], fill up the Frisco [Building] and start giving downtown some life again." Stogel offers the same logic: "The Century is going to come down to be the functional parking for this [the Old Post Office], the Syndicate, the Frisco, the Paul Brown, the Arcade/Wright and other neighborhood uses."

He also maintains that the proposed Ninth Street parking garage is necessary both for the security and convenience of the judges and their staff and for the Webster students, not to mention the future needs of the district. "It's unfortunate that the Century has to come down," he notes, "but it's the only logical place that allows the concurrent development of all the other buildings so that we do not stand alone. We stand at the center of something that works. We're not doing it piecemeal. We're doing it holistically. You're going to have a minimum of 600 and a maximum of 700 apartment units and 1000 people -- our vision -- living in the Old Post Office district, and what do they need? They need parking."

And with the Roberts Brothers' recent purchase of the American Theater, says chairman and CEO Mike Roberts, the square is looking at increased nighttime traffic. The developers own the Board of Education Building, which they've renamed the Roberts Lofts on the Plaza, as well as the Roberts Mayfair hotel, another Old Post Office neighbor. Roberts Brothers' loft and hotel parking needs are met, he says, but they want to use the new garage for the theater's needs. "We're going to feed the parking business with quite an array -- along with the programs, concerts, theater, banquets, and corporate events that will be at the American."

Carolyn Toft, the Landmarks Association's executive director, suggests that anyone simply look to see if any downtown parking garages are full at any time other than during a Rams game. "I'm looking out at an empty garage from my office -- and we're right there -- and there's another [garage] under construction that hasn't opened yet," she argues. "I mean, we've got more parking per capita than any other downtown in the United States." Plus, she says, foot traffic is necessary for the vibrancy and overall feeling among residents and visitors that the downtown area is safe. If they have to walk a couple of blocks to their destination, so much the better for local businesses.

And Lynn Josse adds that the downtown redevelopment trend is already taking place -- without the parking garage. "These developments are happening," she notes. "The garage has not happened and the developments are happening. It shows that it's not as necessary as everybody thought." The garage is not the trigger that people claim it is, she says. "It's not a catalyst because it didn't start all the other development."

"There's a way to do it all," says Toft. "There's just been this compete inability to have that kind of a conversation, from the moment I first heard of this proposal -- and it was presented not as a proposal, but as a fait accompli."

She hasn't given up hope that the city will reverse the demolition. In a prepared statement for Riverfront Times, she cites a recent change of heart by the St. Louis Board of Education: "Within the last few weeks, the Board of Education acknowledged the cultural importance and neighborhood development/stabilization potential of St. Louis' astonishing collection of historic school buildings. It then amended its public position in the sale of redundant properties to include historic significance when evaluating bids for purchase. This thoughtful, courageous action has reassured many of us that the Board does indeed have a commitment to the community-at-large. It is not too late for Mayor Slay to demonstrate the same sort of leadership and require an objective review of the ill-conceived, still-not-financed Old Post Office Square project."

One reason for the delay in a financing announcement by DESCO and DFC may be Marcia Behrendt's lawsuit, filed in U.S. District Court last May 28, which seeks to halt the Century's demolition. As a property owner with a view of the Century Building from her Tenth Street loft, Behrendt claims in the suit that she "has a property interest which will be injured by the present plan for Old Post Office Square that will diminish the value of her property by changing the essential character of the Central Business District by eliminating one of the most singular and historic properties located therein," the Century Building.

"What the lawsuit is challenging," explains her lawyer, Matt Ghio, "is the programmatic agreement [a statement of intent] that governs both of those projects. My client is asserting that they didn't follow federal law in coming to this programmatic agreement, for a number of reasons. They didn't consider reasonable, prudent alternatives to the piece of the project that destroys the Century building. But it's also asking the court to order all of these parties to go back and consider all the alternatives they should have. The main concern about getting it back to the drawing board is that proposed garage."

It's a suit to save the Century, basically, and even its supporters say it doesn't stand much of a chance. "I hope that the lawsuit keeps [the Old Post Office proposal] from happening long enough for it to die a death of its own," says one downtown insider, who declined to be named, "but it's sure been hanging in there."

If, however, Stogel and company come to terms with their prospective tenants and complete their financing package, demolition of the Century will begin immediately -- the suit is powerless to prevent it. Then, says Ghio, "that would force my client to change her claim to one for damages for the diminution of value" of her loft. The Century will vanish and, predicts Stogel, the district will be on its way to filling the empty office space that surrounds the Old Post Office. "In five years," he says, "25 percent of the entire vacancy that existed three years ago -- when DESCO and DFC started this deal -- could be addressed and turned back into a useful, viable neighborhood plan that works." Until the ink is dry, however, the Century Building remains.

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