Private: Massive Uptown project expected to set tone for redevelopment
When Tom Rowe, Peter Horton and Matt Packer launched Terrex Development and Construction in 2014, the trio threw down a map and started circling potential areas for development.
At the top of their list: land surrounding the upcoming $80 million Interstate 71 interchange at Martin Luther King Drive, which started construction in fall 2014.
“We couldn’t believe more developers hadn’t already started planting flags,” Horton said.
They focused on properties that hadn’t been acquired by Uptown Consortium Inc., the nonprofit community development group for the Avondale, Clifton, Corryville, CUF and Mount Auburn neighborhoods. Rowe and Horton started driving through the area immediately. The first property on their list was the former Hillside Supply building at 3025 Concordia St.
Now, Terrex and Messer Construction Co. are working on a huge development at the new interchange of Martin Luther King Drive and I-71. The development, which is unnamed at this point, is the first large-scale joint project for Terrex and Messer. In total, it could be a roughly $150 million development that sets the tone for the entire redevelopment of the area surrounding the west side of the interchange.
“It’s a once-in-a-lifetime opportunity,” Rowe said.
The vision is a high-density, urban-scale project that connects with the surrounding community. The development would sit on nearly 6 acres of land at the southeast corner of Martin Luther King Drive and Reading Road in Avondale. There, Terrex and Messer have room to build three office buildings with a total of 450,000 square feet of space, a 200-room hotel with opportunity for street-level retail and an underground parking structure with space for more than 1,200 vehicles. A park will be integrated within the development on the top deck of the parking structure.
“This is a landmark site,” Rowe said.
For Uptown Consortium – founded in 2004 by leaders of Cincinnati Children’s Hospital Medical Center, Cincinnati Zoo & Botanical Garden, UC Health, TriHealth and the University of Cincinnati – this represents the first time it will sell some of the more than 140 properties it has acquired over the last three years. Since the Consortium started acquiring property near the interchange, it has purchased 143 properties for nearly $23.5 million.
Beth Robinson, CEO of Uptown Consortium, said the site plan and uses Terrex and Messer have in mind are what the Consortium would like to see.
“We felt that team brings a lot of expertise and the financial capacity and backing to pull together a complex project,” Robinson said.
Uptown Consortium is acting as the master developer for the area. It is assembling properties, getting plans in place and working with community stakeholders to keep everyone engaged.
Even though this is just a small portion of the roughly 40 acres owned by the Consortium, this project is vital because of its location and timing.
“It will launch and set the tone for what follows,” Robinson said.
The interchange ramps are scheduled to open in May, with the entire project expected to wrap up this summer. The team is preparing to close on its purchase soon. Construction is expected to begin this year.
Tom Keckeis, CEO of Messer, said this development will change the landscape in Uptown.
“Old, dilapidated buildings will be replaced with buildings that get some real energy into them,” Keckeis said. “It will be the catalyst for other development.”
This project would be the first fruit of a seed Mayor John Cranley helped plant 14 years ago. Cranley, a Cincinnati city councilmember at the time, went to the Uptown community councils to get their support for a new interchange at Martin Luther King Drive. The thinking at the time was to get the level of development activity seen at new suburban interchanges in the heart of Cincinnati.
“It’s going to open up all kinds of economic development opportunities in Uptown,” Cranley said.
He called the Terrex/Messer project a “huge priority” for the city.
“We want it to be about jobs. A new building there that is putting people to work,” Cranley said. “We can’t rush it, but we want to get it going as soon as possible.”
Terrex and Messer plan to start with two office buildings totaling about 300,000 square feet and the hotel atop the parking garage. By putting the parking underground, Terrex and Messer are solving two issues:
The hotel would likely be built and operated by a partner. Rowe said multiple hotel partners are interested in the site.
The development would eliminate Concordia Street and extend Winslow Avenue north into the site.
The development also has a commitment from Uptown Consortium to use a portion of the $45 million in New Market Tax Credits the community development group received in November 2016. Rowe said that funding could be a huge boost for the project.
“We have the opportunity to make an iconically designed building be economically competitive with the market,” Rowe said.
The Terrex-Messer team is focused on creating opportunities in Avondale for certified minority- and women-owned businesses for all aspects of the project, from design and construction services to general services and investment opportunities to workforce composition.
Terrex didn’t go into specifics other than to say they will be aggressive, but the group is confident it can hit its goals.
Patricia Milton, president of the Avondale Community Council, praised the way the team has worked with the community. From early on in planning, the team met with the council to get community input and include it.
“It’s been very rewarding for us to know they hear and listen to the community as part of their business proposal,” Milton said.
Web Ventures LLC serves as a consultant for Uptown Consortium on diversity and economic inclusion. Bill Witten, a principal of the firm, said by making the entire process inclusive, from pre-construction to wealth building opportunities, this project and others that follow give residents of the community a chance to take ownership of what’s happening.
The development team has selected JLL to be the listing agent for the office product. Rusty Myers, executive vice president in JLL’s Cincinnati office, is leading the charge.
He said the focus will be working to bring research and development users and companies focused on innovation to the area. However, he believes the project will be attractive to all office users because of the accessibility not just to and from the highway but to four of the region’s seven largest employers: Cincinnati Children’s Hospital Medical Center, UC Health, TriHealth and University of Cincinnati.
“Look where interchanges have gone in. Pent-up demand explodes when that happens,” Myers said.
Keckeis said companies that are attracted to the research work being done by Cincinnati Children’s, UC and UC Health, all less than a mile away, will have a place to locate near those organizations.
Even though this nearly 6-acre site could be home to tens of millions of dollars in new investment, it is just the beginning. Robinson said it is important to keep in mind the transformation of Uptown is a long-term endeavor.
Rowe and the rest of the team are approaching it with the same perspective.
“We’re looking to be a very long-term, active developer in this market,” he said.
Original article posted on January 13, 2017 by the Cincinnati Business Courier.