Here We Go Again (Page 1 of 3)

Once an impressive local landmark, the long-neglected Sunsphere has become little more than a kitschy presence in the local skyline. Knoxville’s younger residents have probably never taken the 43-second elevator ride up to the five-story globe, and others may only be familiar with the Sunsphere through an episode of The Simpsons.

Originally designed as a “monument to the sun, the source of all energy,” the Sunsphere was the theme structure for the 1982 World’s Fair and the first spherical building in the United States. The structure cemented its place as the centerpiece for the six-month-long World’s Fair, drawing more than 11 million visitors and pumping more than $25 million in tax dollars for the city and $500 million into the local economy. But no one had made sufficient plans for the Sunsphere beyond the summer of 1982—the building is notoriously inefficient, its gold-plated windows making it difficult to cool the interior. By 1984 the building was essentially deserted as The New York Times described the site as having “all the warmth and atmosphere of a ghost town.” The city’s signature building, the most recognizable feature of Knoxville’s skyline, has been little more than a shell for more than 20 years.

As development begins to bloom throughout downtown Knoxville, city officials have once again turned their attention to the World’s Fair site in the hopes that the aging icon can be resurrected—or at least salvaged.

Taking center stage in the deal, which involves leasing and development, is Chattanooga-based Kinsey Probasco Hays, the same firm that previously landed two controversial deals involving publicly owned property over the past three years.

Kinsey Probasco Hays (KPH) purchased the Candy Factory and the 11th Street Victorian houses in 2005 from the city. The group, led by principles Jon Kinsey, Ben Probasco, and Ken Hays, were also the developers responsible for the downtown redevelopment plan that included a 2003 Market Square rehabilitation and the 2004 construction of the Walnut Street parking garage.

Bill Lyons, senior director of policy development for the city of Knoxville, said KPH was the only bidder out of nine offering to take on the Sunsphere; all others focused on other World’s Fair Park structures.

“[KPH] were the only ones in the game on the Sunsphere. They’re paying to lease out floors four through eight and provide the fourth floor back to the city,’’ he said. “We’ve agreed [KPH] will build up the observation deck and have a snack bar and special event space on the fifth and sixth floor.”

The fifth floor has some restaurant equipment in it that makes it a bit smaller Lyons said. “The top two floors will be a tenant, most likely The Shelton Group,” a local advertising and marketing firm.

The average price for downtown development is roughly $9 per square foot, according to a market appraisal prepared for the city last summer by Property Service Group Southeast. An 8,000 square foot space at 806 World’s Fair Park Drive appraised in the report rents for $7.50 per square foot. Applying the same rate to the Sunsphere’s 10,000 square feet puts the fair market rental value at $75,000 annually. Such a price tag, however, doesn’t account for the Sunsphere’s unique cultural identity, an asset that private owners would surely stress in marketing the structure.

But in the proposed agreement that will be brought before City Council in a few weeks, KPH will lease the Sunsphere from the city for about a third of the average rate, or about $5 per square foot (or $57,000/year), Lyons said. The group’s lease will also include a proposed $2 per square foot utility charge.

But Lyons assures that the leasing and utility prices that KPH pays the city will grow yearly with “inflation and increases to price index,” he said. “The $5 per square foot will go up.”

While a point of contention for council and KPH has been the term of the lease of the Sunsphere, originally set at 40 years, but neither group was comfortable cementing the deal for that long.