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Friday, March 19, 2004

Condos round out Kroger deal


Editorial

Cincinnati City Council did the right thing in going Krogering for condos as part of the garage deal for the grocery giant. Wednesday's 7-1 vote to invest another $2.5 million of city money to help finance 25 condos at Vine Street and Central Parkway opens a gateway into the future of Over-the-Rhine.

The combination of a 950-space garage and condos not only should keep Kroger's headquarters downtown for years to come but also builds confidence in redevelopment up Vine and throughout downtown. The combination deal was crafted by a combination of resourceful new partners that raises hopes Cincinnati's development reforms are gelling and can produce. The new development authority 3CDC, City Manager Valerie Lemmie and new Development Director Chad Munitz had a strong hand in assembling the financing. The "partners" need to keep the momentum going and make sure other Over-the-Rhine developers get the help they need to succeed.

Council voted $11.8 million last fall for the parking garage, which will serve Kroger's headquarters during the day and the Ensemble Theater, Cincinnati Art Academy and others at night and on weekends. The condos are expected to cost $7.64 million to build, and will sell for an average of $170,000. Kroger donated the land valued at $860,000. The city's $2.5 million grant leveraged private funds: a $2 million loan from the Cincinnati Equity Fund and a $1.8 million construction loan from the Cincinnati Development Fund.

If the condos sell for more than expected, 3CDC and the city would split the profits, and both would roll back any proceeds into future Over-the-Rhine investment. Over-the-Rhine's homeownership rate barely moves the needle at less than 5 percent, and even Section 8 rent voucher families have been moving out.

Developer Rick Kimbler argued the city subsidy is justified not only because of added costs of environmental cleanup, but also the project's potential to bring more homeowners and developers into the game. "This will drive development north on Vine Street to 13th and 14th streets," Kimbler said.

Developer Chris Frutkin, who built the Crawford Lofts condos on Main Street, plans to renovate two Vine Street buildings, a block north of the Kroger garage, into 25 apartments for student housing.

Vine and Central Parkway is downtown's busiest intersection - 20,000 vehicles a day. The 2001 Over-the-Rhine master plan and the city's "request for proposals" on the Kroger garage called it a "gateway project."

The developer's designers need to deliver on that promise. A $20 million investment there should even help make the case for such projects as the new performing arts school south of Music Hall. Cincinnati's development consultant John Alschuler argues buildings need to produce wider benefits than just those on-site.

The Kroger deal makes us all partners in remaking Over-the-Rhine. We need to seize such opportunities to reinvent our historic Old Town.



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