Mercedes dealership may roll into Southpoint

Sep. 19, 2013 @ 10:20 AM

A Charlotte-based automotive dealership group is looking to open a Mercedes-Benz dealership near The Streets at Southpoint mall and to move the downtown Chevrolet, Buick, GMC and Cadillac dealership onto the same site.

Hendrick Automotive Dealership group officials confirmed their plans on Wednesday. The confirmation follows a Durham City Council vote earlier this week that paved the way for the company and a South Carolina developer to move forward with a new autopark on property near the mall.
“That location right there is the best location,” said Mike Desmond, market area vice president and executive general manager for Hendrick Automotive Group. “When you’re looking at an enterprise such as this…it’s all about traffic counts, and the traffic counts on that road, like I said, are (among) the best in the state.”
The company is looking to start construction this year on the property in what’s now the Kentington Heights subdivision.
Lewis Cheek, an attorney working with Hendrick and South Carolina-based developer WRS Inc., said it’s his understanding that the land is under contract and the purchase is expected to happen within weeks.
Bill Bell, Durham’s mayor, said site control always has been an issue for developers interested in the multi-owner property.
Desmond said the company wants the Mercedes-Benz dealerhip to open in June of next year, and for the Durham Automall, which is the name of the company’s Chevrolet, Buick, GMC and Cadillac dealership, to open there in the fall.
The company started downtown with the purchase of a Chevrolet dealership in 1992, he said. In 1997, the company moved the Chevy dealership to its current location on South Roxboro Street. In 2008, he said, they purchased the Cadillac, GMC and Buick business, and consolidated them downtown.
With the planned move of the Durham Automall to the Southpoint area, he said the company would be moving the business closer to many of its customers. He also said they see the high traffic volumes on Fayetteville Road, as well as Southpoint’s mall, as draws.
“All those restaurants and high-end stores, we can play off each other,” he said. “Customers can drop off their cars, they can go ove, and shop in the mall.”
He also said the company sees the site as a location with enough property to allow expansion.
Cheek said the company has “bigger plans for the site.” He said that in addition to the plans confirmed Wednesday, the company wants to develop a second phase and buy more land.
Steve Medlin, director of Durham City/County Planning, said officials have “only expressed interest” in a second phase, but have not shared any other specifics.
Desmond did not release any details outside of what was confirmed Wednesday. He said it’s a “long process” to get additional acreage.
For the initial phase, there’s still work to be done. The land still must be bought, according to Cheek, and Medlin said the site plan for that phase is under review. And Desmond said that in order to confirm the Mercedes-Benz dealership, the company first has to acquire the land and build the facility, although they do have a letter of intent.
“We have a history and proven track record of developing very, very top-notch automalls,” he also said, pointing to Performance Automall in Chapel Hill and Cary Automall as examples of its development record. “This just created a great opportunity for us to create another automall in the Triangle, and we feel the Triangle is a great place to invest.”
Bell spoke in support of the development as a means to free up the property downtown for possible additional development.
“I think it would also enhance the appearance of downtown if that were to happen,” he said.
Geoff Durham, president of the downtown-focused economic development group Downtown Durham Inc., said the downtown master plan does show plans for the auto dealerships to move to allow for higher-density, mixed-use development.
“It would stand to reason that as land values change…those dealerships would migrate to suburban locations and those properties, given their size and their locations, would be prime locations for mixed-use and higher-density developments,” he said. “Those are great pieces of commercial real estate. I don’t get the sense there will be any shortage of interest.”
Bell also said he believes the sale of the property for the development would also bring “a lot of relief” to property owners in Kentington Heights.
“It obviously gave a lot of relief to property owners in that development because that area had already begun to deteriorate…,” he said.