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The News & Observer
October 29, 2000
Roland Gammon has always liked cities - even when
he couldn't afford to live in one.
When he was in college at Carolina back in the '60s, Gammon and
his girlfriend would camp on the outskirts of such cities as Washington,
Boston and Baltimore to save money for a night on the town. "I'd
change into a coat and tie in my tent," Gammon said. "I
got to thinking cities are a pretty cool thing."
Gammon eventually turned that fascination with urban life into a
career. As a developer, he has spent 18 years buying land in downtown
Raleigh and putting up offices, apartments and condos, often in
areas others considered a risk.
He was the first to realize that a new market was evolving for
young professionals and empty-nesters who wanted to live near their
jobs, clubs and restaurants and didn't want to mow grass. So when
others wouldn't risk it, he converted an old mill building on Capital
Boulevard into the Cotton Mill, with 50 condominium units. Since
the project was completed four years ago, about 400 homes, condos
and apartments have gone up or been announced in the downtown or
its fringe. Though that is only a tiny fraction of the total number
of homes built in the Triangle in four years, civic boosters and
city planners consider it significant. They have long believed that
getting more people to live downtown is a key to reviving it. Gammon
plays down his role in downtown Raleigh's comeback. "I haven't
picked up the banner of trying to revitalize downtown," Gammon
says. "I'm exploring business opportunities."
But George Chapman, the city planning director, said Gammon's contribution
to downtown redevelopment outweighs the profits made from his projects.
"Roland has been a real pioneer," Chapman said. "He's
been more visionary than a lot of other developers. He's put back
in more than he's taken out." Although Gammon has had significant
success in recent years, that has not always been the case. Nearly
two decades ago, on his first attempt to reach those same empty-nesters
by building condominiums in West Raleigh, the project lost lots
of money. "I was ahead of it," Gammon says, matter-of-factly,
alluding to the recent interest in living near downtown.
A hammer in his hand:
The 6-foot- 2-inch Gammon started in construction early, helping
his dad build shelters and barns on the Edgecombe County tobacco
farm where he grew up. He came to the Triangle to study accounting
at the University of North Carolina at Chapel Hill. But he didn't
seek a career in business. Prompted by his fondness for cities,
he enrolled in architecture school at the N.C. State University
School of Design. He paid his NCSU tuition by painting houses.
After graduating in 1976, he formed a small renovation company
and spent the next six years building decks, screen porches and
additions onto homes. "I liked building things," Gammon
says. "I always had a hammer in my hand." But Gammon wanted
to dream up his own projects, and he turned to a favorite area -
downtown - for his first development. Some run-down apartments and
townhouses in the 100 block of Glenwood Avenue were for sale. Gammon
and his partners renovated the buildings into offices and quickly
leased them out. That project, Cooper Square, was one of the first
successes in the area known today as Glenwood South, which has recently
become a hub for night life with its restaurants and clubs.
Gammon says he thought Cooper Square offices would be in demand
because they offered free parking for tenants and customers and
were centrally located. But he also saw opportunity in an area most
developers had shunned as too risky. Since then, taking the unconventional
approach has almost become a trademark. Carter Worthy, a longtime
friend, said Gammon is a man of contrasts, largely private and routinely
all-business. "It's not going to be a long chat if you call
him," Worthy says.
But Gammon is always thinking about deeper subjects such as the
long-term consequences of development, Worthy says, even if he's
not talking about them. "He'll get into really long, philosophical
conversations about development policy," says Worthy, a commercial
real estate broker. " ... He's interested in the bigger picture
of how do communities sustain themselves. He was talking about issues
people now call smart growth long before that phrase was coined
- how do you build something that lasts?"
A costly gamble:
After Cooper Square, Gammon decided to build a type
of housing just being introduced to Raleigh - condominiums. He bought
a small tract of land on Oberlin Road near the Hayes Barton neighborhood
and built eight luxury units, hoping they would appeal to upscale
residents who didn't need their big homes anymore because their
children were gone. He priced the units at $225,000, waited for
buyers and kept waiting. Even after he lowered the price to $175,000,
below cost, it still took two years to sell the condos.
Today, those units don't look like a bad investment; one sold last
year for $363,000. But the losses temporarily soured Gammon on condo
projects, and he began another office project that would fare even
worse.
He bought a former textile mill, Pilot Mills in the
Mordecai section near downtown, and secured a five-year lease from
the state for most of the space. "It was like hitting a home
run in the world series in the bottom of the ninth," Gammon
remembers.
But the economic downturn of the late 1980s hit, and suddenly lenders
wanted a 10-year lease. The state wouldn't agree to a longer lease,
and the old mill was repossessed. Gammon had to borrow money to
stay afloat. His luck changed in 1993 when a landowner wanted to
sell a small tract on Edenburgh Road near the Carolina Country Club.
"People said I ought to do more condos," Gammon recalls.
"I said I'd rather have a root canal." But he reconsidered
and decided the time might finally be right for a project like the
one he had first tried on Oberlin Road. He agreed to buy the property
for eight luxury condos contingent upon selling half of them in
advance. All the units were sold before the project was finished.
The formula:
Gammon not only made a profit, he found a formula
for success he has used ever since: All property purchases are contingent
upon preselling a substantial number of units, which minimizes his
financial risk. When the Cotton Mill building went up for sale for
$1 million, Gammon bought it contingent upon selling 60 percent
of the units in advance. "The risks were time and marketing
expenses," Gammon says. "I thought it was worth the risk."
He was also betting on demand for downtown housing. The Cotton Mill
was sold out before it was completed. "I had a sense from the
media and other areas of the country that there was a movement to
urban living," Gammon says, rattling off the names of movies
in which main characters were living downtown. Gammon has gone on
to become one of the region's most prolific condo developers, building
hundreds of units across the Triangle. He's now planning 71 row
houses in Chapel Hill's Meadowmont - 3,800-square- foot monsters
costing up to $750,000, perhaps the most expensive attached homes
ever built in the region.
Many of his projects were downtown, including 12 condos
on Martin Street in the Warehouse District, the 48-unit Governors
Square in Mordecai and the recently finished Park Devereux with
46 units overlooking Nash Square. All the condos were sold before
the projects were finished, a sales record that did not go unnoticed
by other developers. "There are many people who doubted the
Cotton Mill would be a financial success, but Roland foresaw it
would be and had the tenacity to make it happen," says Gregg
Sandreuter, who recently bought a 1.1-acre parking lot on Dawson
Street just north of Park Devereux and plans a condo project. Sandreuter
continues: "And starting with the Cotton Mill and Martin Street
and Park Devereux, Roland went on to demonstrate that the Cotton
Mill was not an aberration but a real growing market."
George Roland Gammon III:
Age: 54
Born: Tarboro
Position: Owner of White Oak Properties, which has developed hundreds
of condominiums across the Triangle and led the downtown housing
movement in Raleigh.
Employment history: 1982 to present, owner of White Oak Properties;
1976 to 1982, owner of Gammon Design/Build, a small renovation company;
1970-1973, middle-school mathematics and science teacher in Bailey
and Greensboro.
Education: Bachelor of Science in business administration from the
University of North Carolina at Chapel Hill in 1969; Master of Architecture
from the N.C. State University School of Design in 1976.
Hobbies: Golfer, avid reader. Currently reading biography of Winston
Churchill by Martin Gilbert; just finished two-part biography of
Lyndon Johnson by Robert Caro.
Family: Wife, Jill Gammon; son, Jed; daughter, Emily.
Caption:
Roland Gammon sits in front of one of his newest projects, Park
Devereux overlooking Nash Square.
Staff Photo By Swayne B. Hallc photo
Copyright 2000 by The News & Observer Pub. Co. |
