This is an archived article that was published on sltrib.com in 2007, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
Utah contractor and landowner Rick Howa is taking a $50 million gamble on one of Salt Lake City's oldest neighborhoods.
He's broken ground on Marmalade, a mixed-use development along 300 West from 500 North to 600 North in Salt Lake City. The sizeable development, on 5 1/2 acres, will feature 50,000 square feet of shops, service-oriented businesses and eateries, and more than 90 pricey condominiums and townhomes in a neighborhood now dotted with older, in some cases run-down, homes.
Howa is betting the area, named after marmalade fruit jam and all the fruit trees that were once planted there, is on the brink of a resurgence.
Whether Marmalade eventually becomes as popular as The Avenues or the Sugar House areas of Salt Lake City remains to be seen.
But many in the development community say if anyone can transform a community, it's the low-profile Howa.
"Rick has always been a pioneer," said veteran Utah commercial broker Bill Martin. "When you're thinking as far ahead as he does, it doesn't always work out. But he's good at making it work out. And I think this project will do well. It's a neat area, ready for a resurgence, that could become another Sugar House."
The project is a departure of sorts for Howa, the principal of Howa Construction, a Utah commercial construction company started in 1951 by his father, Joseph P. Howa, who died in 2003 at age 86.
But then Howa is used to switching gears. Back in the late 1960s and early 1970s, Rick Howa thought he would go into the journalism business.
He earned a degree in English from Westminster College to prepare for a life in that field. But then he got out of school and instead applied for a job as a deputy sheriff for Salt Lake County - it sounded more interesting than writing newspaper stories.
Then his father was hospitalized. For a year and a half, Howa ran his father's company. His father eventually came back to work, but by then Howa had not only learned the business but had developed quite the knack for it.
Since joining the family business, Rick Howa has managed the construction of 1,000 buildings in 34 states, including more than 600 grocery stores.
Most of those grocery stores were built for companies affiliated with grocery and drug store magnate Sam Skaggs, with whom his father had a close relationship.
"That man gave me more opportunities than I could ever hope for," Howa said.
Today there's not just Howa Construction. There's Howa Holdings, an umbrella company for two companies - Howa Construction and Howa Capital, companies engaged in the various aspects of real estate investment, construction and development.
Real estate portfolio
In Utah, Howa is best known for constructing the Wells Fargo Center in downtown Salt Lake City, which started out as headquarters for the grocery chain American Stores.
But his career has moved far beyond construction over the years. He's also a landowner, landlord and real estate investor- someone who has done quite well buying properties that no one wants until years later.
Over the years, Howa has assembled a portfolio of real estate in the Salt Lake area that includes the old Utah Theater building at 148 S. Main St. and two adjoining buildings, at 152 South and 156 South; an office building he partly owns at 384 E. South Temple; and the P.F. Chang's/Acme Burger building at the northeast corner of 300 South and 200 West.
Now, Howa says, he yearns for a different role - one of more of a visionary instead of someone who builds things for other people. "My focus now is on development," he said.
But transitioning into being a developer hasn't been totally easy. He tried drumming up support for revamping the Utah Theater building - transforming it into a theater that could help revive downtown. That didn't work, and the building still sits vacant.
His largest development project to date is a fairly small retail branch for Fidelity Investments, 279 W. South Temple, a building designed and built for the company, which leases space from Howa.
Marmalade, designed by Utah architect Prescott Muir & Associates, will be his biggest development project.
There is little doubt that the retail portion of Marmalade will flourish in an area starved for more commercial development.
Howa says he's finalizing leases with an ice cream shop; pizza, sushi and Mexican-food restaurants; hair and nail salons; a wine and tapas bar; and a dry cleaner.
Residents who live nearby such as Polly Hart, chairwoman of the Capitol Hill Community Council, say they are so excited about the prospect of being able to walk such a short distance to shops and restaurants that they can hardly wait until the retail portion is finished.
Hart believes the commercial part of Marmalade should do well because representatives of Howa's company actually listened to residents.
"They have worked closely with us to make sure this is what the neighborhood really wants."
The housing component is a bit more uncertain. After several years of a boom, Salt Lake City's real estate market is slowing down, especially in the higher price ranges. There is no telling just how well 82 condominiums and nine townhomes priced from the low $300,000s to high $600,000s will sell.
Gary Cannon, president of the Salt Lake Board of Realtors, said "affordable" condos in the lowest price ranges are selling the best, while some higher-priced units are languishing on the market.
"The market for high-end condos has definitely slowed," but Cannon thinks condo developments with a retail component - such as Marmalade - often do better than those without any retail.
Believes in project
For his part, Howa believes his project stacks up well with others being built or planned for downtown.
"I think a fair number of other projects like it are missing the mark," he said. He believes there are too many "value-priced" [read: low-end] condos and flats being peddled. Even among those units in the price range of his project, "they don't have [a] retail [component] like Marmalade does," Howa said.
Years ago when Howa first starting planning Marmalade, there weren't enough condos in the downtown area. Now numerous developers - even The Church of Jesus Christ of Latter-day Saints - are either planning or building downtown condo projects.
Still, Howa points out that 40 of his condos already have been reserved by people who have put down $1,500 to $3,000 in refundable deposits. Not all reservations translate into actual sales, but he believes many will.
In any case, he's not taking any chances. He has hired veteran real estate broker Babs De Lay, who specializes in the downtown condo market.
De Lay acknowledges the slowdown in the housing market overall, but adds that condo sales in the downtown area are holding up. She, too, thinks the retail component of Marmalade will appeal to a lot of people, and she's betting that many buyers will be drawn to the efforts by Howa to gain environmental certification for his condos. Howa made numerous changes to the condo component to gain The Leadership in Energy and Environmental Design, or LEED, designation, which underscores buildings that are energy efficient.
Howa said his development is designed to appeal to people who want to live downtown in luxury - people who could afford a house in The Avenues or Federal Heights but who want to live downtown and desire new construction, not something built 100 years ago. Square footages in his condos and townhomes will range from 900 to 2,200.
Construction of Marmalade is under way, with the first retail shops expected to come online in the spring.
The first housing units aren't expected to debut until spring 2009, which may actually work in Howa's favor, said Shauna Lupcho, executive vice president of finance and investments for Howa Capital, the development affiliate of Howa Construction.
"I'm very optimistic that in another 12 to 21 months we'll be into a healthy housing market again," she said. "We have some time on our side."
Plus, Marmalade will be finished before the LDS Church's City Creek development, set to open in 2011, which includes condos.
"We're two years ahead of that project," Lupcho says.
Howa insists that everything is in place to make Marmalade succeed - even though he isn't handling construction of the project himself.
The bank that provided financing for Marmalade put the kibosh on that - it did not want one company handling both development and construction work.
So Howa said he farmed out the construction work out to one of Utah's largest companies, Okland Construction.
"I don't regret the decision to hire Okland - they are the second-best contractor I know," he said. "I'm the best."
Rick Howa
* Born: Sept. 18, 1949
* Education: Highland High graduate; English degree from Westminster College in 1972; completed three-year executive management program at Harvard Business School in 2001
* Hometown: Salt Lake City
* Family: Wife, Lisa; two sons, J.R., 21, and Zachary, 19; J.R. works in the family business and is being groomed to run it; Zachary is attending the Culinary Institute of America and is a chef.
How you know Rick Howa
* Constructed the skyline-altering Wells Fargo Center, 299 S. Main St. in downtown Salt Lake City. Also built the Jewish Community Center and Hotel Park City.
* Tried to revive the old Utah Theater building, 148 S. Main St. He owns it and two adjoining structures.
* Owns the Fidelity Investments building at 279 W. South Temple St. Is the partial owner of office building at 384 E. South Temple St. and the P.F. Chang's/Acme Burger building at 300 South and 200 West.
What he's working on now
* Marmalade is a mixed-use development along 300 West from 500 North to 600 North in Salt Lake City that will feature 50,000 square feet of shops and eateries, and more than 90 pricey condominiums and townhomes.
What you don't know
* He knows enough about the grocery business to open his own store, given that his company has built more than 600 groceries nationwide.
More online
* For more stories about local real estate, go to http://www.sltrib.com/realestate.