Sunday, January 16, 2000

Remaking Sycamore Hill


Redevelopment of a high-potential city site has stalled. Now it may be ready to move again.

BY MARK CURNUTTE
The Cincinnati Enquirer

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Sycamore Hill provides picturesque views of downtown.
(Steven M. Herppich photo)
| ZOOM |
        In the early 1990s, a handful of urban pioneers turned empty buildings on Sycamore Hill into 30 market-rate apartments with spectacular city views.

        The project, backed with $1.2 million in federal grants handed out by the city, was so successful that Cincinnati's housing department stepped in with another $1 million to keep the momentum going on the Mount Auburn hillside.

        But the building stopped. The hammers fell silent. The city blames the neighborhood. The neighborhood blames the city.

        Each year since 1997, the city's Department of Neighborhood Services has fallen short of its goals to produce housing units on Sycamore Hill: 0 for 10 in 1997; 0 for 20 in '98; 2 for 15 last year. The city made no Sycamore Hill grants or loans for four years. And the longer the fund sat untapped for development, the more of it — $220,000 to date — went to pay for city staff and services.

SYCAMORE HILL DEVELOPMENT
map
  Mount Auburn's front lawn, Sycamore Hill, has gone from hot to cold in efforts to create middle- and upper-income housing in the city of Cincinnati. A look at the numbers on the hillside:
  • 1993-1994: $1.2 million in federal funds administered by the city results in 30 apartments in four housing developments.
  • 1995: $966,500 in additional city money is made available for housing development loans and grants.
  • 1995-1998: No grants or loans are made by the city's Department of Neighborhood Services on Sycamore Hill. No additional housing units funded.
  • 1999: $79,000 loan goes to developer to create two, still-unfinished units of housing on Sycamore Street; $222,000 has been spent on city paperwork and services and Neighborhood Services staff time.
        “There's not a lot of help coming lately from the department to make things happen,” said Chris Carmichael, who used a $120,000 federal grant from the city toward the $373,000 it took to rehab his building at 1639 Sycamore St. in 1994. He lives in one of the seven apartments and leases the two retail spaces.

        It may not be bricks and mortar, but progress has been made on some projects, says Neighborhood Services Director Cheryl Meadows. Before the first nail is pounded, plans must be evaluated, geological surveys completed, engineering studies finished, and the mix of public and private financing stitched.

        At any point, deals can fall apart. When they do, the city has to start over.

        “We're not continuing to flounder on the hill,” Ms. Meadows said. “We've had problems in the past and will be moving forward.”

        Whatever the explanation, City Council is tired of delays. Money is available. A development company is ready.

        And council wants action.

        On Wednesday, council will vote on an ordinance to give $640,000 in Sycamore Hill money to that developer, Dorian Development. The city investment is expected to yield $4 million in new housing, according to the council motion.

        The Mount Auburn company, controlled by Pauline Van der Haer, wants to build five 3,300-square-foot houses on Dorsey Street and create three one-bedroom apartments in a building it owns at 1785 Sycamore St.

        “I have two people who want to buy Dorsey Street houses,” said real estate agent Denise Guiducci of Sibcy Cline. “People are dying to move back to the city.”

SYCAMORE HILL SPENDING
  The city established another account in January 1995 to stimulate housing development on Sycamore Hill in Mount Auburn. Here's how the money has been spent.
  Total appropriated: $966,500
  Housing loans/grants: $79,000
  Total other expenditures: $222,479
  Balance: $665,021
  Expenditures include:
  Staff costs: $132,589
  Relocation: $4,626
  Demolition: $24,366
  Construction contracts: $3,900
  City Law Department: $36,325
  Professional services: $396
  Housing units funded: 2
  Housing units completed
: 0
  Source: Cincinnati Department of Neighborhood Services.
        Councilman Charles Winburn, who in June introduced the motion to fund Dorian Development, said that's the best way to get housing built as soon as possible on Sycamore Hill.

        “Dorian has produced,” Mr. Winburn said, “and Dorian will produce quality housing for the city. It's a sound business decision.”

        Since it was formed in 1992, Dorian has used $2.7 million in city funding for 10 housing development projects, an August 1999 Neighborhood Services report shows. With city investment, Dorian has created 188 new units — a mix of market rentals and low-income housing — and attracted $8.7 million in private investment, according to the report. Dorian's average per-unit public subsidy of $14,400 is below the city's target subsidy of $20,000-$30,000.

        Mayor Charlie Luken says Dorian has the right track record. Council action to support the company on Sycamore Hill is in line with his vision to bring people back to a reborn Cincinnati. “I've committed my office to try to move something forward in that area,” he said. “No place is more convenient with a better view than Mount Auburn.

        “The hope is that this will be seed money that will attract private investment.”

Target area
        The Sycamore Hill development area straddles an eight-block stretch of Sycamore Street that runs north from Liberty Street.

        The hill is the gateway to Mount Auburn and has been one of City Hall's priority development areas for more than a decade.

        The neighborhood offers skyline views and historic buildings. It is nestled on a hillside within walking distance of downtown to the south and is only minutes from the University of Cincinnati and major hospitals to the north.

        It's the one-of-a-kind place — the city's last underdeveloped hillside with downtown views — that could draw middle- and upper-income residents back to Cincinnati at a time when its population and tax base are shrinking.

        The timing is right. National and local studies show demand is high for urban residential options.

        Market housing on Sycamore Hill attracted Lawra Baumann.

        She rents a two-bedroom apartment at 1777 Sycamore St. It's in an 11-unit apartment building developed for $1.2 million by Dorian in 1994 with the help of $600,000 in federal money granted by the city.

        “I have a great view of the city,” said Ms. Baumann, 40, who moved in a year ago from Westwood after a divorce. “I spend a lot of time just looking out the window.”

        And she walks. She walks downtown to work at Fifth Third Bank, where she oversees its foundation's charitable giving. She walks to Findlay Market to buy food. She walks in the neighborhood, scouting property she wants to buy and develop.

        “I love it here,” she said.

        The Dorian building was one of four projects that made use of $1.2 million in federal grants handed out by Neighborhood Services in 1993 and 1994.

        Another was Mr. Carmichael's building, which has no residential vacancies. The other two projects were apartment buildings at 1610 and 1614-1616 Sycamore, which were turned into 12 units by the Rhinelink development company.

        The results were renovated apartments in 19th-century buildings with high ceilings, large windows and woodwork. A two-bedroom rents for about $750 a month with off-street parking. At 1777 Sycamore St., apartments boast updated kitchens, security systems and timber decks that overlook manicured green spaces, tidy brick walkways and an in-ground pool.

        City investment in the area gave residents and business owners hope.

        “We've had some success here,” said LeVonia Clark, who, with her husband, Howard, owns Milton's — “the Prospect Hill Tavern” — at the corner of Sycamore and Milton streets. “We'd like to see more development.”

        The Clarks live on Prospect Hill, which extends east of lower Sycamore Street. They used no public money to open the tavern in 1992 or a gourmet food shop next door a few years later. But as development stalled, so did neighborhood growth. They closed the shop.

        “We had a very upscale product,” she said. “It was too upscale for the time.”

        Momentum, apparently still dependent on city investment, was lost on Sycamore Hill almost as quickly as it was found.

        Neighborhood Services made no housing grants on loans on Sycamore Hill in 1995, 1996, 1997 or 1998.

        It has made only a single loan from the active fund in five years. That came last year, $79,000 to Eber Associates to rehab the building at 1613 Sycamore St.

        Work on two apartment units has just begun — windows went in two weeks ago — and that's all there is to show for city investment in the past four years.

        Neighborhood Services officials say the council motion for Dorian funding prevented them from making a second loan in 1999, for $300,000 to LeAnne Coulter to create four housing units at 1757 Sycamore St.

        There wasn't enough money to do both. And Neighborhood Services is now looking for alternative funding sources for the Coulter project.

        “Sycamore Hill is important to us. We haven't been sitting dormant,” Ms. Meadows said.

        She said the department is also working on a project to create five new housing units on Boal Street. That project is working through setback disputes and related hillside regulations.

        Those efforts take staff time and money, Ms. Meadows said.

        Since 1995, more than $220,000 of the $966,500 development account has been spent on city services and paperwork, $133,000 of it to pay Neighborhood Services staff, according to documents obtained by The Cincinnati Enquirer through an Ohio Open Records Act request.

        Some of that staff time was used for oversight of the first four Sycamore Hill projects that received public funding, said Gerard Hyland, the department's supervising community development analyst. Other staff time has been used to research other potential projects.

        Regardless of the reasons, the city's inability to pull the trigger on any deals between 1995 and 1998 has left many Sycamore Hill residents confused and upset.

        “Because nothing has happened, one feels betrayed by the city,” said sculptor Ted Gantz, a 20-year Mount Auburn homeowner whose house and business are at the bottom of Sycamore Hill, near Liberty Street.

        But delays are part of development in a depressed city neighborhood, Ms. Meadows said. She and her staff said there are many reasons no deals were made in four years:

        • Disputes with property owners about whether city funding should be grants or loans.

        The city prefers loans for rental development, Mr. Hyland said. The first four Sycamore Hill projects were grants. Then, some developers say, the city changed course and insisted on low-interest loans.

        City Manager John Shirey said there is no absolute policy. “The goals are to increase housing, leverage private investment, then we make a decision” on funding, he said.

        • A limited number of property owners with whom to work in a small target area.

        Neighborhood Services reduced that number even more when it sued a Dorian affiliate — Hughes Redevelopment — over how $29,000 of an $83,000 housing loan had been spent on Hughes Street in Mount Auburn. In 1996 and 1997, the department prevented any company in which Ms. Van der Haer had an interest from doing business with the city. Dorian and related companies control several properties on the hill.

        Ms. Van der Haer said the department backed out of construction contracts and tried to force Hughes to buy dilapidated property. Council interceded on Hughes' behalf, directing the city's law department to avoid going to trial and demanding Hughes account for the disputed $29,000, city records show. After the city's suit and Hughes' countersuit were dropped and Hughes showed it had the $29,000, the department still refused to work with Hughes and related companies, Ms. Van der Haer said.

        • Deals that fell apart.

        One deal that called for building 20 houses at the summit of Sycamore Hill collapsed after the city invested significant time and money.

        As recently as January 1999, Neighborhood Services considered using $900,000 in public money to fund a two-part deal in which the property owner, former Cincinnati Health Commissioner Stanley Broadnax, would have been principal developer.

        The deal collapsed in November when the city's appraisal of $80,000 fell short of the $160,000 Mr. Broadnax was asking for to pay off lien holders. Records from Neighborhood Services files show the department was going to pay Jireh Development, an arm of Walnut Hills-based Christ Emmanuel Christian Fellowship, to buy the property from Mr. Broadnax.

        Neighborhood Services also invested two years of staff time and taxpayers' money into trying to work a Sycamore Hill development deal with Mount Auburn property owner Carl Westmoreland, department records show. Mr. Westmoreland wanted funding for a 12-unit condominium project at 1924-1934 Auburn Ave.

        City records from 1993 show that Mr. Westmoreland carried $260,000 in liens on the property but that he and his attorney had negotiated payment reductions.

        In a May 1995 memo, Neighborhood Services asked the city's law department if it was a “proper public purpose” to spend $150,000 to maintain the Westmoreland building for later use as housing, and if the city could pay the owner's debts on a building when the debts are not the costs of development.

        Both answers were no.

        Still, the department continued to work with Mr. Westmoreland through 1996 to try to find a workable Auburn Avenue development plan.

        The buildings fell into such a state of disrepair that the city's buildings and inspections department had to raze them in 1998 at a cost of $57,174. The bill is due Thursday but has not been paid, city officials said.

Return to glory
        Now, at council's instruction, Neighborhood Services is working with Dorian.

        The company “has a very good record,” said Ms. Meadows, the department director. “They do a good job. They do good work. We're proud of that building,” 1777 Sycamore St.

        Ms. Van der Haer said the city's $640,000 grant in her company's projects will allow it to leverage almost $2 million in private financing and investment.

        That's why public money is used in developing neighborhoods. The goal is to create more market-rate rental and home-buying options to balance high concentrations of subsidized housing.

        That description fits Mount Auburn.

        Some people on the hill envision the neighborhood returning to its past glory. A century before it became one of Cincinnati's most impoverished neighborhoods, Mount Auburn was the city's first hilltop suburb, where the Tafts and other influential families built grand homes.

        And Sycamore Hill is its front walk.

        “It's a lovely street,” said Gale Sheldon, an Anderson Township resident who owns the building that houses her husband's law office at 1618 Sycamore St. “This would be a wonderful corridor for doctors' offices.”

        Mrs. Sheldon and her husband, Henry, have met adults, including law clients, who have shared memories of growing up in the neighborhood.

        “There used to be a drugstore up the street,” she said. “And people would get their prescriptions filled after visiting their doctor.”

        She's not complaining about the hillside neighborhood now. But she sees an even brighter future for it.

        “Don't get me wrong,” she said. “I would live there now.”

Council to vote on grant for Mount Auburn company



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