$42M L’Oreal Expansion to Add More Than 200 Jobs in Northern Kentucky

By Adrian Maties, Associate Editor

L’Oreal USA, a wholly owned subsidiary of L’Oreal SA, the world’s leading beauty company, will expand its 560,000-square-foot facility in Florence, Ky. The $42 million expansion project will include renovations to the existing plant, new construction and the purchase of new equipment.

Kentucky Gov. Steve Beshear joined L’Oreal and local officials at the groundbreaking ceremony held on Nov. 15. He praised the French-based cosmetics and haircare manufacturer, saying, “We’re proud to have L’Oréal in Northern Kentucky and excited to see more than 200 new jobs and a $42 million investment on the way. The Commonwealth’s partnership with L’Oréal demonstrates the quality of the workforce in Northern Kentucky, as well as the advantages that come with such an ideal location for business.”

L’Oreal purchased the plant located at 7080 New Buffington Road in 1993 as part of its acquisition of Redken Laboratories. Over the years, the company has invested more than $160 million into it. The plant employs more than two hundred full-time workers and produces 165 million units of L’Oreal products each year.

The 110,000-square-foot plant expansion will create another 211 jobs over the next three years. “L’Oreal’s business is growing globally, and the expansion will enable us to meet increased consumer demand for the popular haircare brands we are producing in Kentucky,” said Eric Wolff, plant manager. “The Florence plant is a center of manufacturing excellence for the L’Oreal Group, and the decision to expand U.S. production here will result in significant economic benefit for Kentuckians.”

The Kentucky Economic Development Finance Authority (KEDFA) preliminally approved L’Oreal for tax incentives up to $5 million for the expansion through the Kentucky Business Investment program. These incentives are tied to the company meeting job and investment targets. KEDFA also approved the company for tax benefits as high as $800,000 through the Kentucky Enterprise Initiative Act.

Process Plus, an architecture and engineering firm, will design the project, while the Miller Valentine Group will serve as construction manager. Once finished, the project will apply for U.S. Green Building Council LEED certification.

Photo credits: Google Maps.

Gateway Unveils Plans for $80M Urban Campus in Covington

By Adrian Maties, Associate Editor

Gateway Community and Technical College last week released the details of the master plan for its urban campus in downtown Covington. The $81.5 million plan is expected to transform the region’s urban core into a vibrant college community with opportunities for economic development as well as educational improvement.

Nine properties will be renovated and will form the nucleus of the new campus, located in a six-block area in Covington, from Fourth to Seventh streets and from Greenup Street to Madison Avenue. The college has already purchased or is finalizing deals to purchase the properties. Gateway will continue to occupy the former Two Rivers school building at 525 Scott Blvd. It acquired the property in 2010.

Gateway first announced its intent to create a campus in the urban core in June 2007. The goal was to replace its aging campus on Amsterdam Road with new facilities that would provide easier access to urban residents. The Kentucky General Assembly granted Gateway the authority to sell the Amsterdam Road campus and use the proceeds from the sale to develop the downtown campus. The college will also sell the adjacent Park Hills Elementary School, a property it acquired in 2003.

The Gateway Foundation has committed $5 million, with $12 million coming from the college and the Kentucky Community and Technical College System. Gateway will seek the remainder of the funding from the general assembly in 2014.

The new campus will provide nearly 300,000 square feet of space for instruction, student services and related academic purposes. It will serve 2,500 new urban students per year by 2014 and 5,000 new students by 2020.

”We are building a complete campus that will meet the unique needs in the urban core,” Gateway president & CEO Ed Hughes said. “The urban campus not only will change the lives of the students who find new hope within its streets and walls, it will create as yet unimagined economic development potential for the river cities and the whole region.”

Click here to view the full text of the master plan.

Photo credits: Gateway Community and Technical College

CyrusOne Buys Downtown Cincinnati Building; Flaherty & Collins Snaps Up Oakley Site

By Adrian Maties, Associate Editor

CyrusOne Inc., the wholly owned subsidiary that owns and operates Cincinnati Bell Inc.’s data center business, has acquired its parent company’s downtown Cincinnati building.

According to the Hamilton County Auditor’s Web site, the data center business paid $18 million for the property. The transaction went down on Oct. 30. The acquisition is part of CyrusOne’s plan to spin off from Cincinnati Bell Inc., which was announced earlier this year.

The building is located at 229 W. Seventh St. It has 14 stories and totals 350,000 square feet, with Cincinnati Bell occupying almost 74,000 square feet. It will lease that space back from CyrusOne, according to papers filed with the Securities and Exchange Commission. 229 W. Seventh St. is connected to 209 W. Seventh St., with some shared utility services. Cincinnati Bell owns 209 W. Seventh.

In other news, Oakley FC L.L.C., an affiliate of Indianapolis-based Flaherty & Collins, recently purchased 11 acres of the former Cincinnati Milacron site in Oakley. According to the Hamilton County auditor’s Web site, Oakley FC L.L.C. bought the property from USS Realty for $3.8 million in a deal that closed on Oct. 19.

Oakley FC lists Flaherty & Collins’ Indianapolis address as its own. Flaherty & Collins’ plans call for the construction of seven apartment buildings with 302 units at Oakley Station. The apartment complex will be named The Boulevard and will be located on the southwest portion of the 74-acre, $120 million Oakley Station development. It will feature units with granite countertops, balconies, washers and dryers, and oversize windows, and will include such amenities as a fitness center, club room and aqua lounge.

Construction has already started. The first of the seven buildings is expected to be finished by summer 2013.

Photo credits: Google Maps.

$25M Project to Transform Covington City Hall into Hotel Convington

By Adrian Maties, Associate Editor

Milwaukee-based Aparium Hotel has recently formed a partnership with the Salyers Group and the city of Covington to develop and manage The Hotel Covington, a luxury boutique hotel in downtown Covington. The new hotel will be the first of its genre in the market.

The project will cost $25 million and represents the rehabilitation of the seven-story city hall building at 638 Madison Ave. It was built in 1910 and for its first 67 years housed Coppin’s Department Store. It was also the first concrete skyscraper in Kentucky. In 1984, the city acquired the building for $1.5 million and renovated it.

The 102-year-old building will now be transformed into a modern, luxury hotel with 107 rooms designed to accommodate the business traveler,  with a full-service restaurant and bar. The entire first floor will be dedicated to dining, meetings and lounge space. The Hotel Covington will be designed to reflect the city’s rich culture and history. Officials expect the project to be completed by mid-2014.

The city of Covington will donate the building to the project, thus becoming an equity partner in the hotel. It will have to move its offices to another downtown location, but a final decision on the relocation site has not yet been made.

The project is expected to create approximately 125 jobs. It will be funded with the use of new market tax credits, historic state and federal tax credits, traditional bank financing and investment from Salyers Group and Aparium. The Hotel Covington is the first project of the Catalytic Development Fund, a Northern Kentucky, private sector, not-for-profit organization that provides funding assistance and related services for developers of quality residential and commercial real estate projects in Northern Kentucky’s urban cities.

The new hotel is expected to boost the economy of downtown Covington and spur additional development. Mario Tricoci, CEO of the Aparium Hotel Group, said ,“The Hotel Covington is destined to be a place where friends gather and travelers find a sophisticated but approachable property – a truly Translocal environment.”

                                 Photo credits: Google Maps

Entertainment Complex Planned for Purple People Bridge

By Adrian Maties, Associate Editor

The Purple People Bridge may take on a very new look in the coming years–if a study shows it can support the hotel, retail and entertainment project envisioned for it.

The Newport Southbank Bridge, also known as the Purple People Bridge, stretches 2,670 feet over the Ohio River and connects Newport, Ky., to downtown Cincinnati. The original bridge opened on April 1, 1872, and was Cincinnati’s first railroad bridge. The current bridge, built in 1896 and since rehabilitated, accommodated streetcar, pedestrian and automobile traffic. In May 2003, it was re-opened for pedestrians only.

State Representative Dennis Keene worked to secure the funding for the engineering study, and a check for $650,000 was cut by the Kentucky Transportation Cabinet to determine whether the Purple People Bridge can support the development. The analysis is expected to be completed in 2013.

The project would be the first of its kind in the United States and is estimated to cost $100 million. Plans call for a 150,000-square-foot entertainment complex that will include a boutique hotel, conference and banquet center, restaurants and pubs. The project is also expected to create more than 1,000 jobs.

State and local officials are optimistic the study will allow the project to proceed. The Newport Southbank Bridge Co., the owner of the bridge, is currently in talks with three developers interested in the project.

Newport Mayor Jerry Peluso said it ”is an exciting project for the city of Newport and all of Northern Kentucky and Greater Cincinnati.” Officials expect the project to help improve the local economy by attracting tourists, visitors and investors. A Marcus & Millichap report says hotel occupancy in the midwestern United States continues to recover from recession lows. Ohio’s occupancy has risen to 56.5 percent.

Photo credits: www.purplepeoplebridge.com

Charts courtesy of Marcus&Millichap.

Hayneedle Expands Distribution Center in Monroe

By Adrian Maties, Associate Editor

Hayneedle, the Omaha-based online retailer of home goods, announced last week it has expanded its distribution and fulfillment center in Monroe. The Hayneedle Distribution Center will now be able to accommodate the company’s continued growth.

Hayneedle opened in 2010 on Logistics Way. It signed a lease with Industrial Developments International (IDI) for 501,357 square feet at the Monroe Logistics Center, about 20 miles north of downtown Cincinnati. The company chose this Butler County facility for its proximity to customers: It can reach more than 70 percent of its customers in two business days from this location. The facility is its primary customer distribution and fulfillment center and is also home to a Hayneedle retail outlet.

The distribution and fulfillment center has been expanded by about 20 percent, to almost 600,000 square feet. Hayneedle also has the option to add another 120,000 square feet in the coming years. According to Dave Woods, the facility’s operations director, Hayneedle expects to be able to store more than two million cubic feet of product in the expanded facility.

The online retailer will employ as many as 150 full-time and seasonal workers at the expanded distribution center during the 2012 holiday shopping season. Hayneedle was represented  in the expansion by Si Pitstick, executive vice president with Cushman & Wakefield | Cincinnati Commercial Realtors.

“Expanding our Monroe facility after only two years demonstrates our phenomenal growth, ongoing commitment to the Monroe area and confidence in the facility’s operations team,” said Tom Clement, vice president of supply chain and logistics for Hayneedle. “It also demonstrates our belief in the incredible workforce in Monroe and the surrounding communities.”

Photo credits: Google Maps.

Ground Broken on Cinemark Theater at Oakley Station

By Adrian Maties, Associate Editor

Construction crews recently broke ground on a new 14-screen Cinemark movie theater at Oakley Station, one of Cincinnati’s largest, new mixed-use developments. The theater is expected to be completed in the third quarter of 2013.

Reece-Campbell is building the 59,000-square-foot theater together with Franklin-based Hi-Mark Construction Group on the former Cincinnati Milacron plant site in Oakley. The developers originally expected to start work on the theater in April. They also expected to have it open by the end of the year.

The new complex will be the first Cinemark theater in the Greater Cincinnati area. It will feature a state-of-the-art viewing environment with wall-to-wall screens and 100 percent digital projection, as well as a Cinemark XD Extreme Digital Cinema auditorium with plush seating where customers can enjoy the latest 2-D and 3-D movies on a wall-to-wall, ceiling-to-floor screen. The theater will also offer enhanced sound systems equipped with higher-quality speakers and 7.1 capable digital surround sound. The theater lobby will be designed around one of Cinemark’s innovative self-serve concession stands.

The new Cinemark Theater is part of the $120 million Oakley Station project. The 74-acre development on the east side of I-71 and Ridge Road will bring 225,000 square feet of retail space, 300,000 square feet of office space and 302 residential units to Cincinnati.

Cincinnati-based Vandercar is developing the Oakley Station project. The company removed more than 1.6 million square feet of deteriorated, obsolete and dormant industrial buildings from the site that housed the historic Cincinnati Milacron Machine Tool Co. (formerly known as the Cincinnati Milling Machine Co. and established in 1989) and was once considered the center of the world for industrial production of machine tools. It took more than a year to clear the entire site. Work started earlier this year on roads and infrastructure.

Photo credits: www.oakley-station.com

Downtown Office Complex to Hit the Auction Block This Month

By Adrian Maties, Associate Editor

Two downtown Cincinnati office buildings are going on the auction block this month. The buildings, Centennial Plaza I and III, are part of the Centennial Plaza office complex near Cincinnati’s city hall. They are listed on Auction.com with a starting bid of $1.5 million.

Centennial Plaza I and III are located on Central Avenue, between West Seventh and West Ninth streets, in the heart of Cincinnati’s Central Business District and directly across the street from Cincinnati City Hall. The two Class A office buildings total 225,000 square feet and are 40 percent occupied.

Centennial I was built in 1985. It stands five stories tall, with 75,000 square feet of space. Centennial III was built in 1988, is 11 stories tall and has 150,000 square feet of space. Amenities include granite and marble lobby finishes, 24-hour security, a conference center, an on-site restaurant and catering, WiFi, garage parking for all employees and concierge services.

The Centennial Plaza office complex is managed by the Indianapolis-based Citimark Management Co. It includes another building, Centennial Plaza II, owned by the city of Cincinnati.

New Boston Centennial L.L.C., an affiliate of New Boston Citimark, acquired Centennial Plaza I and III in 1999 for $13 million. According to Auction.com, bidding on the property is scheduled to start on Oct. 22 and end two days later.

Class A office space is highly sought after in Cincinnati, and Marcus & Millichap experts think demand will grow in the metro area as construction activity slows and employment picks up. Overall vacancy is expected to decrease to 19.8 percent this year, while asking rents will rise 0.6 percent to $18.76 per square foot and effective rents  1.1 percent to $14.97 per square foot.

Charts courtesy of Marcus&Millichap.

Photo credits: Auction.com

Developers Plan 450 Apartments in West Chester

By Adrian Maties, Associate Editor

With vacancies dropping and rents growing, apartment construction is on the rise in the Cincinnati Metro Area, and Marcus & Millichap predicts that by year-end the stock will have increased by 1.1 percent as developers finish 1,000 apartments. It represents the largest year-over-year increase in nine years. And there’s more to come.

WCPO reports that a pair of developers plan to bring 452 new apartments to downtown West Chester, on both sides of the Union Centre interchange. Capital Investment Group Inc. and Hills Properties will each meet with the city’s zoning commission next month and will present their plans for the two separate residential communities.

Capital Investment Group Inc.’s The Cascades at Union Centre is the first residential community to be proposed. The 180-unit development will be located along Centre Pointe Drive, just south of The Square at Union Center and West Chester Towne Centre, and will include first-level retail space.

The second proposed residential community is called The Lofts at The Streets of West Chester. To be developed by Hills Properties, it will include 272 residential units and will be located on the east side of I-75.

Both developments are located within walking distance of restaurants, retail shops and other amenities. West Chester is the largest township in the state of Ohio. It features almost 3,000 businesses and is ranked as one of the best places to live in America, according to Larry Brueshaber, president of the West Chester Development Council. Rents in both communities are expected to exceed $1,200 per month.

The projects still need a variety of approvals before construction can begin. The West Chester Zoning Commission will consider both developments at their meeting on Oct. 15.

“By introducing a critical mass of people into an area rich with restaurants, retail, corporate development and civic amenities, communities develop a sense of ‘place’ and a vibrant core, which has always been the vision for Union Centre,” township administrator Judi Boyko said in a news release. “With this critical mass, our downtown will thrive, continue to be an excellent investment for future developers and therefore will support the ongoing sustainability for the community as a whole.”

Charts courtesy of Marcus&Millichap.

Eagle Hospitality Looks to Sell Hotel Portfolio, Including 3 in Cincinnati

By Adrian Maties, Associate Editor

Eagle Hospitality Properties Trust is putting three Greater Cincinnati hotels up for sale. The hotels are part of a larger portfolio of 13 properties for which the company recently reached an agreement with its secured lender, the Blackstone Group, allowing it to sell them off and repay its debt at a discount to avoid foreclosure.

The three Cincinnati hotels include the Marriott at RiverCenter and Embassy Suites Cincinnati RiverCenter in Covington and the Hilton Cincinnati Airport in Florence.

The newly renovated Marriott RiverCenter hotel is close to downtown Cincinnati. It has 321 rooms, a full-service health club, 30 meeting rooms and 119,000 square feet of total meeting space. The Embassy Suites Cincinnati  RiverCenter hotel is located on the banks of the Ohio River and has 226 suites, more than 8,000 square feet of indoor and outdoor event space, a fitness center and an indoor heated swimming pool. Just six miles away from the Cincinnati/Northern KY International Airport, the Hilton Cincinnati Airport has 306 rooms, 9,300 square feet of flexible meeting space that will accommodate as many as 400 guests, a fitness center and an indoor swimming pool.

All 13 properties have been well maintained, with $77 million in capital expenditures since 2008, and are located in desirable Midwestern markets. Lazard Freres & Co. is the company’s exclusive financial advisor. The other hotels are:

• The 184-room Chicago Marriott Southwest at Burr Ridge;

• The 336-room Hyatt Regency Rochester;

• The 284-room Embassy Suites Hotel Columbus/Dublin;

• The 271-room Embassy Suites Hotel Cleveland/Rockside;

• The 273-room Embassy Suites Hotel Boston at Logan International Airport;

• The 174-room Embassy Suites Hotel Denver-International Airport;

• The 270-room Embassy Suites Hotel Phoenix-Scottsdale;

• The 243-room Embassy Suites Hotel Tampa-Airport/Westshore;

• The 299-room Embassy Suites Hotel & Casino San Juan;

• The 351-room Hilton Glendale.

“The Embassy Suites-, Hilton-, Marriott- and Hyatt-branded properties are experiencing excellent growth and are well positioned in their markets,” said Marc Beilinson, managing director of Beilinson Advisory Group and Eagle Hospitality’s chief restructuring officer. Beilinson expects the hotels to continue growing and earn even more. “This is a tremendous opportunity for investors to acquire high-performing assets amid a historically low-cost market for borrowing,” he added.

Image courtesy of Marriot Hotels & Resorts.

Connor Group Breaks Ground on Award-Winning HQ

By Adrian Maties, Associate Editor

The Connor Group, a real estate investment firm that deals exclusively in luxury apartments, has started work on its new state-of-the-art headquarters at Dayton-Wright Brothers Airport in Miami Township. Public and company officials attended the groundbreaking ceremony, held on Sept. 13.

The new headquarters will have a 39,000-square-foot office building and aircraft hangar. Messer Construction is building the two-story facility on a seven-acre piece of land in Miamisburg. Moody-Nolan, a nationally renowned architectural firm based in Columbus, has designed the one-of-a-kind structure. The entire project is expected to cost around $16.5 million and should be complete in 18 to 24 months.

The new property’s modern design won an important award even before the first shovel hit the ground. Last month, the Chicago Athenaeum selected it to win a 2012 American Architecture Award. Together with 86 other projects from around the world, it will be part of a traveling international exhibition. It will be displayed at “The City and the World” symposium in Istanbul, Turkey, and at museums throughout Europe.

All offices will have at least two walls made entirely of glass. The building will feature a brushed aluminum façade and a central atrium space that will provide employees with access to natural light. Plans also include a number of sustainable design features such as stormwater management, rainwater harvesting, recycled materials and optimized energy performance.

Larry Connor, managing partner of The Connor Group, praised all the parties involved in the project. He  admitted that without their help the project would not be going forward. “A lot of times you hear people talk about how difficult it is for the private and public sectors to accomplish things together,” he said. “This is a perfect example of how it can work. From the city of Dayton to Miami Township to the Port Authority to the Dayton Development Coalition, we’ve found nothing but forward-thinking, hard-working people determined to make this work.”

Just like the company that will occupy it, the new building will be totally unique. Curt Moody, Moody-Nolan’s CEO, collaborated with Larry Connor on the design of the facility. He called it an “iconic statement” and “a jewel for all of Ohio.”

Rendering courtesy of www.facebook.com/pages/The-Connor-Group/293573274040498.

Ground Broken on $10M Affordable Housing Project

By Adrian Maties, Associate Editor

Cincinnati is growing, with investments being made, thousands of jobs being created, the unemployment rate going down and the population growing. And with confidence in the housing market still low, especially in the suburbs, apartment operators are very, very happy these days.

Marcus & Millichap is predicting that apartment vacancy in Cincinnati will fall to 4.7 percent in 2012, while rents are expected to increase by 2.8 percent. Developers are trying to take advantage of the solid demand for apartments. Some of them are making plans; others are already breaking ground. 

Jonesboro Investments Corp. is one such developer. The company broke ground on Sept. 5 on a $10.4 million multifamily affordable housing project in Florence, Ky. Representatives from the Northern Kentucky Community Action Commission, the Kentucky Housing Corp., U.S. Bank and Jonesboro Investments Corp., along with legislators and local officials, all took part in the groundbreaking ceremony held at 10285 Memory Lane, near the intersection of Frank Duke Boulevard and Dixie Highway.

Magnolia Glen Apartments is a 60-unit (45 two-bedroom and 15 one-bedroom), five-building development. It will open a year from now, in September 2013, and will be available at rents ranging from $550 to $640 per month. The complex will feature Energy Star appliances and lighting and will have a clubhouse, business center and computer facilities, central laundry and on-site management.

The project is supported by a public-private tax credit financing partnership. The Kentucky Housing Corp. administers the Affordable Housing Tax Credit Program in the state of Kentucky. It allocated tax credits to the project to generate the capital needed to subsidize the development, thus making it possible for the owner to rent the units at below-market rates. U.S. Bank provided both debt and equity for the project. Magnolia Glen Apartments has received a $7 million construction loan and a $9.8 million Affordable Housing Tax Credit equity investment through a subsidiary of U.S. Bank, the U.S. Bancorp Community Development Corp.

Charts courtesy of Marcus&Millichap.

Neyer Properties Adds Sharonville Office Buildings to Portfolio

By Adrian Maties, Associate Editor

Neyer Properties recently acquired One and Two Crowne Point in Sharonville, as part of its plan to increase its real estate holdings. The Evanston-based real estate development company has been working on closing the deal for some time now. According to the Hamilton County auditor’s Web site, the former Miller-Valentine office buildings sold for $6.1 million. Steve Timmel of Colliers International assisted with the transaction.

One and Two Crowne Point are two office buildings that each stand four stories tall. They are located within a 40.3-acre office campus, just 14 miles from downtown Cincinnati. I-75 is less than a minute away and I-275 is less than three minutes. The two properties were constructed in 1988 and total 148,000 square feet. They are also prominently positioned along one of the nation’s busiest thoroughfares: More than 140,000 cars pass by the two properties on I-75 each day.

The Cincinnati Business Courier reported on July 30 that One and Two Crowne Point were about 71 percent occupied. At that time, the Hamilton County auditor valued One Crowne Point at more than $4.2 million and Two Crowne Point at nearly $4.7 million.

According to Marcus & Millichap’s third quarter office market report for the Cincinnati metro area, office vacancy is expected to decrease to 19.8 percent this year, while asking rents will rise 0.6 percent to $18.76 per square foot, with effective rents growing 1.1 percent to $14.97 per square foot.

Neyer Properties has expanded in the past three years and now owns more than 3.5 million square feet of commercial, retail and industrial properties. Over the next two years, it plans to purchase and redevelop another two million square feet. The commercial real estate and development company is looking for acquisitions in Columbus, Indianapolis, Louisville and Lexington.

Picture courtesy of Neyer Properties.

Charts courtesy of Marcus&Millichap.

Talbert House to Build 39-Unit Affordable Housing Development in East Price Hill

By Adrian Maties, Associate Editor

Talbert House started work on Aug. 9 on the Talbert House Grand Development Initiative, a complete renovation of an apartment building in East Price Hill that will provide affordable housing for people who want to live in a drug- and alcohol-free environment. More than 50 community leaders attended the groundbreaking ceremony. According to the Cincinnati Business Courier, the affordable housing project will cost $5.9 million.

The apartment building at 960 Grand Ave. in East Price Hill has been boarded up and vacant for years. Talbert House is giving it a chance at a new life. The social service agency will transform the trashed building into an apartment community with 39 single-bedroom units. This could just be the first of hundreds of affordable housing units that the agency hopes to develop in the coming years.

“This is the first Talbert House-supported apartment community in Cincinnati. We hope to develop others across the region to help residents find affordable, safe housing in the neighborhoods where they want to live – where they want to call home,” stated Neil Tilow, president & CEO of Talbert House, in a press release.

Talbert House is financing the apartment community in part through the Low Income Housing Tax Credit program, a federal program that provides a dollar-for-dollar reduction in income taxes for developers of affordable housing in exchange for providing below-market rent for at least 15 years. The social service agency will sell the tax credits to the project’s equity investor, Fifth Third Bank.

To live in the community, tenants must meet low-income qualifications and also agree to live without drugs and alcohol. Some neighbors aren’t happy about the development, but Talbert Housing said there will be a case manager assigned to the building to help residents with services they may need. The building will also have a full-time resident manager. Talbert House hopes to have the building open and people moving in in about a year.

Image courtesy of Talbert House.

Construction Projects to Create 170 New Jobs

By Adrian Maties, Associate Editor

At the beginning of the year, Rough Brothers Inc., a greenhouse design and manufacturing firm, started looking for new space to relocate its headquarters from Vine Street, in St. Bernard, and expand its operations. The search is now over. The company recently agreed to purchase 20.5 acres of vacant land from the city of Cincinnati.

Rough Brothers paid $1.3 million for the site, located at the southwest corner of Paddock Road and Regina Graeter Way, in the Bond Hill neighborhood. The project will have a total cost of $13.3 million, with an estimated construction cost of $4 million. Rough Brothers’ new headquarters will include 150,000 square feet of office and manufacturing space and will be built to LEED standards.

The city of Cincinnati stated that the project will create 120 new jobs within its environs over the next three years and bring $1.2 million in new net tax revenue. Rough Brothers has also committed to stay in Cincinnati for 10 years.

“The Rough Brothers relocation is a perfect example of Cincinnati’s GO Cincinnati initiative being put to work,” said Cincinnati Economic Development Director Odis Jones. “The site the company chose is located in an area that we have been working to grow for advanced manufacturing and research-oriented businesses. Rough Brothers is this type of business and will complement well with this already strong job-generating area of the city.”

Another company, Meyer Tool Inc., a manufacturer of turbine engine components, also plans to invest $2 million to construct a new manufacturing facility as well as expanding at its current location at 3055 Colerain Ave.,  in Camp Washington. The new 30,000-square-foot facility will be located at 3154 Spring Grove Ave. The project will create 50 new jobs and will also allow Meyer Tool to retain 586 current employees within Cincinnati.

“This project represents new investment in the Camp Washington community. The property tax incentive will help the company create new jobs,” said Jones. “The city’s incentive programs lower the cost of doing business in Cincinnati for Meyer Tool Inc. and allow the city to retain a major employer in the business community.”

Charts courtesy of CBRE.

New Owner Plans to Resume Work on Kenwood Towne Place

By Adrian Maties, Associate Editor

Phillips Edison Strategic Investment Fund II L.L.C. recently announced it has agreed to buy Kenwood Towne Place from a lending group led by Bank of America. The deal represents the third acquisition for Strategic Investment Fund II. Phillips Edison established the fund to focus on buying and improving large distressed real estate opportunities.

Phillips Edison lost with a $27.3 million bid to buy the troubled property at a foreclosure auction held last month; Bank of America was the winning bidder with $27.5 million. The price of the latest transaction was not disclosed. Phillips Edison expects the sale to be approved by a Hamilton County judge this month.

The $175 million development was one of Greater Cincinnati’s largest mixed-use projects, with 200,000 square feet of Class A office space and 300,000 square feet of upscale retail. Kenwood Towne Place is located along Interstate 71. Construction started in April 2007 but stopped at the end of 2008 due to the project’s financial problems. Just a few months later, in May 2009, Bank of America filed an $81 million foreclosure suit against the developer.

For the past three years, the partially finished shopping center in Sycamore Township has been an eyesore and a symbol of the economic downturn. Now, Phillips Edison plans to invest about $100 million to finish the development and add new tenants.

Messer Construction will serve as general contractor. Phillips Edison won’t make many changes to the initial plans by PDT Architects. The project was designed with an eight-story office tower above ground-level retail. Current retail tenants include Crate & Barrel, Mitchell’s Salon & Day Spa, The Container Store and LA Fitness. After the project is finished, another 150,000 square feet of retail space will be available.

Phillips Edison hopes to start work this fall. New tenants could move in by the end of next year.

David Birdsall, senior vice president & manager of the Strategic Investment Funds, considers the property an ideal candidate for the fund’s portfolio because it “is at the epicenter for Cincinnati commercial real estate … the dominant regional draw for retail in Southern Ohio and Northern Kentucky, (in) the healthiest office market in greater Cincinnati with one of the lowest office vacancy rates in the seven-county MSA.”

Image courtesy of Brinkmanjg.

White Castle to Build Plant in Vandalia; Cengage Renews Lease in Northern Kentucky

By Adrian Maties, Associate Editor

Columbus-based White Castle broke ground last week on a new food processing plant in Vandalia, near the Dayton International Airport. Gov. John Kasich, White Castle CEO E. W. “Bill” Ingram III and Vandalia city officials attended the groundbreaking ceremony.

The new 75,000-square-foot plant will be situated in the Stonequarry Crossings business park and will be built in two phases. The family-owned hamburger restaurant chain will invest $18 million in the first phase of construction. When finished, the facility will produce frozen hamburgers and cheeseburgers for distribution to grocery and convenience stores across the United States. It will also bring 100 permanent jobs to Vandalia.

Work on the first phase will start this fall. The facility will include a main production floor for raw and cooked food, a raw material freezer, a temperating freezer, a packing room, warehouse, offices and more. It should be completed by the summer of 2013. The developers are aiming for LEED certification.

“We’re proud to call Ohio home and excited about these future plans to add more jobs in our home state,” said Ingram. “The Ohio economic development team is a tremendous partner. We’re enthusiastic about the Vandalia site, and we’re honored that our family-owned business can be a jobs creator, investing with a new production facility.”

In other real estate-related news,  Cengage Learning–a provider of teaching, learning and research solutions for the academic, professional and library markets–recently renewed its lease for 834,000 square feet of space at 10650 Toebben Drive in Independence, Ky. According to CBRE Inc., this is one of the largest industrial lease renewals in the Greater Cincinnati area.

The building is Cengage’s primary distribution center for books. It includes 60,000 square feet of office space. The 12-year lease renewal helps keep about 700 jobs in the region. Colliers International represented Cengage Learning in the transaction, while CBRE Inc. represented the building’s landlord, a private partnership based in Boston.

Chart courtesy of CBRE.

Launch Planned for $65M Miamisburg Business Park

By Adrian Maties, Associate Editor

According to a recent report from Cassidy Turley, the office vacancy rate in the Dayton area dropped from 27.8% at the end of 2011 to 26.1% in the first half of 2012. While the improvement from quarter to quarter is relatively modest, the trend is good news for Mark Fornes Realty Inc. of Washington Township and Miamisburg-based Construction Managers of Ohio. The firms are teaming up to build a $65 million business park in Miamisburg.

This February, BW Partners Ltd., as the partnership is known, acquired 80 acres on Byers Rd. near the Austin Boulevard Interchange from the city of Miamisburg at a cost of $4.1 million. Over the next decade, BW plans to build at least 10 buildings totaling 900,000 square feet of commercial space. That could bring several thousand jobs to the south Dayton metropolitan area.

The area inear the Austin Boulevard/Interstate 75 interchange is a hub for new office construction. Austin Landing, a $150 million mixed-use development just east of the I-75 interchange, is nearby. BW Partners will tout the property’s easy highway access and its proximity to restaurants, shops, cinemas at the nearby Village at Austin Landing.

The developers plan to start construction by the end of the year. Phase one will be a 63,000-square-foot flex industrial building scheduled for completion in Feb. 2013.

Image courtesy of Google Maps.

Charts courtesy of Cassidy Turley.

$200M Dayton Racino Project Moving Forward

By Adrian Maties, Associate Editor

Dayton is one step closer to having its racino. Penn National Gaming Inc. (Nasdaq: PENN) announced on July 2 it wants to relocate Beulah Park in Columbus to Austintown and Raceway Park in Toledo to Dayton. It requested official permission of the Ohio State Racing Commission on June 30. It also formally filed with the Ohio Lottery Commission for Video Lottery Sales Agent licenses as part of its plan to open a $125 million racetrack and video lottery terminal facility in Dayton.

The Dayton facility will be called the Hollywood Slots at Dayton Raceway. It will be a harness racing track located on 125 acres of land, on the site of an abandoned Delphi Automotive plant near Wagner Ford and Needmore roads in North Dayton. Penn National originally announced its plans for the Delphi site in February 2011. The company hopes to receive approval and break ground on the $125 million complex by this fall.

The Austintown facility will be called Hollywood Slots at Dayton Raceway. It will be a thoroughbred track located on 184 acres in Austintown’s Centrepointe Business Park. Both facilities will have as many as 1,500 video lottery terminals and also feature restaurants, bars and other amenities. The projects are expected to generate 1,000 new direct and indirect jobs each and as many as 1,000 construction jobs per facility. An understanding between Penn National Gaming and the office of Ohio Gov. John Kasich also says the casino and racetrack operator has agreed to pay over time a $75 million relocation fee for each racetrack, in addition to the $50 million VLT license fee per track.

With the $125 million investment in land, construction and terminal purchases and the license fees, the price tag of the Dayton racino will reach $200 million. Tim Wilmott, president & COO of Penn National Gaming, said in a press release that “filing for VLT licenses and formally requesting that the Racing Commission approve our relocation plans is another major step forward for these two significant economic development projects.”

Image courtesy of http://www.pngaming.com.

Developers Break Ground on $54M Project in Over-the-Rhine

By Adrian Maties, Associate Editor

The next phase of development in Cincinnati’s Over-the-Rhine neighborhood started on Tuesday, June 26, with the groundbreaking ceremony for the massive, $54 million Mercer Commons project. Cincinnati mayor Mark Mallory, city manager Milton Dohoney Jr., city council members, and 3CDC and PNC Bank representatives attended the ceremony.

The Mercer Commons project was unanimously approved on Nov. 18, 2011, by the Cincinnati Planning Commission. It is part of a broader initiative to redevelop the Over-The-Rhine neighborhood and will be built in three phases on 2.7 acres between East 13th and 14th streets, bordered by Vine and Walnut streets. The project calls for the preservation and renovation of 19 historic buildings and 26 vacant parcels of land, as well as the construction of 126 rental units that include 30 affordable units, 28 condominiums, 17,600 square feet of commercial space and a 340-space parking garage, along with a 19-space parking lot on 14th Street.

The parking garage will be built in the first phase and is expected to open in March 2013. Eleven condominiums in four historic buildings on Mercer Street will be restored, and 12 new condos will emerge on Vine Street. The first phase also includes the construction of five townhomes on Mercer Street and 3,900 square feet of commercial space. The condos and townhomes will range in price from $145,000 to $380,000.

The Cincinnati Center City Development Corp. (3CDC) is developing the Mercer Commons project, and expects to complete the first phase within 16 months. 3CDC is a private, non-profit corporation based in Cincinnati. It was formed in 2003 by former Cincinnati mayor Charlie Luken, and is working with the city to strengthen the core assets of downtown by revitalizing and connecting the Fountain Square District, the Central Business District and Over-the-Rhine.

Over-the-Rhine is believed to be the largest, most intact urban historic district in the United States and is home to the largest collection of 19th century Italianate architecture in the nation. 3CDC has had much success renovating the submarket’s aging buildings.

The complete 3CDC Mercer Commons Neighborhood Redevelopment Plan may be viewed here.

Rendering courtesy of http://www.3cdc.org.