ALAN HOWELL | MBJ

Real estate developer Ray Gill sees investment in Poplar Avenue property as having high potential for commercial development.

A property at the border of Germantown and East Memphis could be the site of the market’s next new office building.

Real estate development firm Gill Properties bought 10 acres on Poplar just east of Kirby for $2.5 million, or approximately $5.74 a square foot, from local developer Walter Wills.

Ray Gill, principal of Gill Properties, wouldn’t reveal the company’s intentions for the site yet.

“It looked like a good investment,” he says. “We’re working on some plans.”

Although the property is zoned for several different commercial uses, market sources indicate it would probably be best suited for office space.

The site is one of the last undeveloped stretches of Poplar in the Germantown and East Memphis border area. Currently undeveloped, the property is across Poplar from the Forum office campus.

“We were very pleased to be able to buy this size of property fronting Poplar,” Gill says.

The site could either handle a few large multitenant office buildings or several smaller office buildings. If it was a larger office property, Gill would have to get approvals from the city of Germantown to build above two stories. The property is currently zoned OG-1, which allows hotel, restaurant or office uses.

“We’re in the process of amending some of the uses,” Gill says.

Anthony Lopes, managing director at Sperry Van Ness/Investec Realty Services, likes the site, but has questions about the current office market.

“It’s a good location,” he says. “The question is whether there is a demand right now. With the office market, there might be a need for a big chunk of space, but there’s still not a lot of small tenants in the market. Small tenants are relatively nonexistent.”

That said, any office development could take several years to open and the market could be in a different spot by then.

“Maybe in two and a half or three years there could be a need,” Lopes says. “I don’t know if there is necessarily a need right now.”

If Gill did build a larger office building, the company would probably try to get significant pre-leasing done before it broke ground.

Most of Gill Properties’ office properties have been of the smaller variety. It currently has two: 8130 and 8134 Country Village. It has several retail properties, including 8100 Macon Station, 8130 Macon Station, 8504 Macon, Kimbrough Crossings, Memphis Banquet Hall, Oxford Marketplace and Stage Centre Bartlett. The company also has multiple self-storage properties and land holdings.

Andy Ashby covers commercial real estate; transportation and logistics; construction; and Downtown Memphis. Contact him at aashby@bizjournals.com.