The Greensboro City Council unanimously approved $2 million for the Steelhouse redevelopment project at the Nussbaum Center for Entrepreneurship.
The resolution authorizing a $2 million commitment to the Nussbaum Center passed 9-0 on Tuesday night. The money is coming from the city of Greensboro’s American Rescue Plan Act fund.
With this commitment, the total raised for the Steelhouse redevelopment project is $4.625 million to date.
The redevelopment of the Steelhouse is the brainchild of Sam Funchess, Nussbaum’s CEO, and Lisa Hazlett, vice president. They envision renovating the 200,000-square-foot former Carolina Steel manufacturing for a multitude of uses – such as a manufacturing center, ghost kitchens, a year-round farmers’ market and office space.
The project – which will take a four-phase approach – is expected to cost about $38 million and could create as many as 600 jobs. It already has its first tenant lined up: Forge Greensboro, a nonprofit community makerspace. The Forge has committed to moving into the Steelhouse’s manufacturing center once completed.
Steelhouse redevelopment at the Nussbaum Center
The Nussbaum Center has envisioned a redevelopment of the over 200,000-square-foot Steelhouse building, renovating it for multiple uses including ghost kitchens, a manufacturing center, a year-round farmers' market and offices.
Lillian Johnson
Sam Funchess (left), CEO of the Nussbaum Center for Entrepreneurship, and Lisa Hazlett (right), vice president, are working on plans to redevelop the former Carolina Steel plant.
James Piedad
The Steelhouse was formerly the headquarters and main production plant for Carolina Steel. The plant officially shut down in 2009.
Lillian Johnson
In 2014, the Steelhouse was donated to the Nussbaum Center by local businessmen D.H. Griffin and Jimmy Clark.
Lillian Johnson
The Steelhouse currently sits empty, a husk of its former self. The building is not just a mix of dirt, concrete and out-of-date machinery.
Lillian Johnson
The Nussbaum Center for Entrepreneurship helps entrepreneurs on their business journeys by providing space and resources. The hope is that the Steelhouse, once completed, will be an extension of what the Nussbaum Center does.
Lillian Johnson
The Nussbaum Center estimates that the total project will cost $36 million and create or retain 600 jobs - 3 jobs for every 1,000 square feet.
Lillian Johnson
The Nussbaum Center's main building, as seen from the back. Across the same parking lot is O'Neal Manufacturing Services, a Florida-based company, who Hazlett said has expressed enthusiasm for the redevelopment project.
Lillian Johnson
Vestiges of a major steel manufacturing center still remain, including this overhead crane operating cart.
Lillian Johnson
The Steelhouse redevelopment will take a phased approach to complete four major areas, including ghost kitchens, a manufacturing center, food production center and office and community space.
Lillian Johnson
Triad Business Journal recently toured the Steelhouse with Lisa Hazlett, vice president of the Nussbaum Center. Here, she points a rail cart line that was used to cart metal within the building.
Lillian Johnson
As it has been empty for more than a decade, the building has fallen into a state of disrepair. The plan is not to demolish it, however, but rather renovate extensively.
Lillian Johnson
A former manager's office sits within the Steelhouse.
Lillian Johnson
Phase I of the redevelopment project will consist of 20 ghost kitchens; Phase II will be a 60,000-square-foot manufacturing center; Phase III is a community space including a farmers' market and 40,000 square feet of office space; and Phase IV will be 40,000 square feet of qualified food production space.
Lillian Johnson
The Steelhouse still has an expansive overhead crane system ranging in weight from 2 to 20 tons. Some will be made operational again for the manufacturing center, Hazlett said.
Lillian Johnson
Phase I, which will consist of 20 ghost kitchens, is a "done deal," Hazlett said, as long as the Nussbaum Center can get its new fire safety plan approved by the city. Built in the early 1900s, the Steelhouse did not have fire safety infrastructure required in modern buildings.
Lillian Johnson
“The vision and mission of the Steelhouse is helping entrepreneurs take their ideas to market,” Hazlett said. “The pandemic has heightened the importance of small business, and that’s why we’re pushing for the Steelhouse now.”
Lillian Johnson
The Steelhouse also has about 2,000 linear feet of rail line that comes through the building. There is one rail line the Nussbaum Center definitely does not want to reactivate, Hazlett said, as it would interfere with redevelopment plans. But there is one that it is looking to renovate, seen here, as it connects to the Norfolk Southern line that leads one way to the Toyota Megasite and the other way to the airport.
Lillian Johnson
As of right now, the Nussbaum Center has $63 million out in grant requests, all of which should be decided by September, Hazlett said. Each phase of the redevelopment has its own grant application.
Lillian Johnson
Hazlett said the Nussbaum Center is only trying to raise funds through grants. In doing so, the Steelhouse will break even at 19% occupancy, she said. At 100%, it will operate at $1 million in free cash flow that will be reinvested in serving entrepreneurs at the Nussbaum Center.
Lillian Johnson
The Steelhouse also has an indoor cart rail system that was used to haul steel scraps across the large building.
Lillian Johnson
The Steelhouse has 40-foot-high ceilings. The Nussbaum Center hopes to add two floors from the top down to convert into 40,000 square feet of office space targeted at entrepreneurs and startups.
Lillian Johnson
Some space within Phase III of the project might be fit for a craft brewery. The Steelhouse sits on an acre of land, some of which could be used for outdoor seating.
Lillian Johnson
Forge Greensboro, a nonprofit community makerspace, has committed to move into the Steelhouse's manufacturing center once renovations are complete.
Lillian Johnson
The Nussbaum Center estimates that each phase, with the exception of Phase I, will cost approximately $12 million. This covers everything from engineering to contractors to materials.
Lillian Johnson
The Nussbaum Center has already received a $2 million investment from an undisclosed organization for Phase I. The investor will be named when construction on the phase begins.
Lillian Johnson
For Phase II, the Nussbaum Center is seeking just under $13 million funding as part of the Piedmont Triad Regional Council’s SITE Next-Gen application to the Economic Development Administration’s Build Back Better Regional Challenge, for which the PTRC is a finalist. Forge Greensboro has also applied for its own funding through the EDA to assist in the makerspace’s relocation.
Lillian Johnson
The Nussbaum Center has raised $625,000 from the Stanley and Dorothy Frank Foundation, the Cemala Foundation, the Carolina Steel Foundation and the Golden LEAF Foundation. Of that collective $625,000, $200,000 from Golden LEAF is designated for fire safety and $100,000 from Cemala is for two bays within the manufacturing center. The rest is for the overall project.
Lillian Johnson
For Phase III, the Nussbaum Center applied for city and county funding, including for a $2 million portion of Greensboro’s American Rescue Plan funding. They have not begun fundraising yet for the final phase.
Lillian Johnson
“The nice thing is that what we believe is going to happen when that first crane appears out there and people start seeing activity, there’s going to be a level of excitement and enthusiasm that maybe doesn’t exist right now, because so many people walk in here and they don’t see it,” Hazlett said. “Sam can walk into here and see what it’s going to look like, but you have a lot of people that walk in here and can’t. They see the dirt, they see the trash, they see that thing sitting on the ground.”
Lillian Johnson
If the Steelhouse receives all the grants it has applied for, the entire redevelopment project could be finished by the first quarter of 2024, Hazlett said.
Lillian Johnson
The Steelhouse will have plenty of leasable space for entrepreneurs and businesses. Hazlett wants to to ensure that the space will be scalable so that as a business grows, the Steelhouse can accommodate it.
Lillian Johnson
In not demolishing the Steelhouse and instead redeveloping it, the Nussbaum Center will be preserving a piece of Greensboro’s – and North Carolina’s – history.
Lillian Johnson
Where the money will go
Officially shut down in 2009, the Steelhouse had been the headquarters and main production plant for Carolina Steel. It was donated to the Nussbaum Center in 2014 by D.H. Griffin and Jimmy Clark.
Hazlett told Triad Business Journal that the primary use of this $2 million will go towards addressing fire safety so that construction can begin. As an old and outdated building, the Steelhouse does not have a fire safety method.
The Nussbaum Center has engaged a fire safety engineer who is working on an alternative fire safety method, as a sprinkler will not be effective while construction is ongoing, Hazlett said. There will be a sprinkler system in the building once completed.
Any remaining funds from the $2 million will go towards the first two projects of the redevelopment, Hazlett said.
Steelhouse looks to rely exclusively on grants
As of late May, the Nussbaum Center had applied for $63 million in grants, Hazlett said. Each phase of the redevelopment has its own grant application.
Hazlett said that the Nussbaum Center will know if it will receive funding from the Build Back Better Regional Challenge by the end of August. Congresswoman Kathy Manning (NC-06) has also put in a $6 million request to the House of Representatives on behalf of the Steelhouse, and Hazlett said that will be determined in early 2023. She said she does not have a timeline for the other county and state grant requests.
Hazlett said that the Nussbaum Center is only trying to raise funds through grants, which will allow the Steelhouse to break even at 19% occupancy. At 100%, it will operate at $1 million in free cash flow that will be reinvested in serving entrepreneurs at the Nussbaum Center.
An undisclosed investor has already the Nussbaum Center given $2 million for Phase I of the project, which will consist of 20 ghost kitchens. Phase I will create approximately 100 jobs that will pay wages 20% higher than the county average, Hazlett estimated. The investor will be announced once construction begins.
The rest of the phases will cost approximately $12 million each.
The Nussbaum Center has also raised $625,000 from the Stanley and Dorothy Frank Foundation, the Cemala Foundation, the Carolina Steel Foundation and the Golden LEAF Foundation. Of that $625,000, $200,000 from Golden LEAF is designated for fire safety and $100,000 from Cemala is for two bays within the manufacturing center. The rest is for the overall project.
