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Development News

Will AC Hotels by Marriott Open Second Regional Location at The Banks?

The Banks development team is close to finally securing a hotel at the multi-billion dollar development, according to multiple sources close to the project. After years of failed starts and negotiations, UrbanCincy has learned that AC Hotels by Marriott is the hotel now being eyed for the prominent central riverfront location.

The news is yet to be officially announced or confirmed by The Banks development team, but UrbanCincy has confirmed the information over the last week with individuals who have requested to remain anonymous due to the ongoing negotiations taking place.

The understanding is that construction could begin prior to the All-Star Game in July.

The news comes after AC Hotels backed out of a deal at the former School for Creative and Performing Arts in Pendleton. Had that deal moved forward, it would have put it on track to be one of the boutique hotel’s first locations in North America, after establishing itself as a household name in Europe.

According to those sources close to the project, the AC Hotel at The Banks would be a seven-story structure with a rooftop bar named AC Lounge. Once open the hotel, which is expected to have between 150 to 200 rooms, would be managed by Cincinnati-based Winegardner & Hammons, which has close relationships with Marriott and Western & Southern, and has overseen the development of numerous hotels in the region.

According to Winegardner & Hammons’ most recent company report, they also recently signed a contract to manage an AC Hotel in Louisville that is scheduled to break ground in August of this year.

AC Hotels announced their aggressive North American expansion plans in 2013, and opened their first hotel in New Orleans in December 2014. After plans were scuttled for the SCPA project, developers at the $350 million Liberty Center announced that a 130-room AC Hotel would open there in late 2015.

Senior management at Marriott International says that AC Hotels is one of their select-service brands and targets a young clientele seeking a “design-led sensibility.” Overall, Marriott’s president and CEO, Arne Sorenson, says that AC Hotels has some 50 development deals signed nationwide, with dozens more in the works.

In an interview with Hotel News Now, Sorenson specifically identified North Carolina and the Midwest as opportunity markets.

In perhaps a view into one of the reasons behind the failed deal at the former SCPA in Pendleton, Sorenson also told Hotel News Now that the vast majority of the deals AC Hotels has in the pipeline are new construction. In fact, aside from the New Orleans project, he said that only one other project was a conversion.

AC Hotels include more European design influences and place a focus on sleek, tech-focused accommodations that appeal to Millennials. In addition to the rooftop AC Lounge, the new location at The Banks would likely include a communal working space, two to three meeting spaces, and a mixture of one- and two-bed guest rooms.

One of the company’s standard approaches is to locate in vibrant urban areas where significant activity already exists. Hotel management says this is to encourage guests to go outside of the hotel and patronize area businesses. To help further encourage that, most AC Hotels do not include an in-house restaurant, and instead allocate more area for public spaces where guests can mingle and interact with their surroundings.

It is not yet known where exactly the hotel will be located at The Banks, but it is assumed to be targeted for the long-vacant placeholder site along Main Street across from Great American Ball Park, which also happens to be located directly on the Cincinnati Streetcar‘s starter line.

EDITORIAL NOTE: Representatives with The Banks development team did not respond to UrbanCincy’s request for comment; however, sources say an official announcement is expected within the coming weeks. We will update this story with more information as it becomes available.

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Development News Opinion

Two Big Ideas to Bring Cincinnati’s Urban Housing Boom to Next Level

San Diego's East Village District [Google Street View]

It has become painfully clear that we are not building enough housing supply to meet demand for center city living. In order to meet those demands, and prevent runaway price increases, now is the time to go big and develop thousands of more units.

In 2014, CBRE released a study about the strength of Cincinnati’s urban real estate market, and noted that the center city housing market could support thousands of additional residential units, even as 2,500 were under development at that time.

This was reinforced by CBRE’s economic outlook for the region released just days ago that said, “The multifamily recovery continues with unabated strength in the Cincinnati MSA with strong demand fundamentals pushing rents higher.” With occupancy hovering around 95% and the strongest demand in the urban core, their real estate analysts expect rents to continue to rise.

As of now, 3CDC is virtually sold out of all of their condos, luxury apartment buildings are being filled in a matter of weeks, and a parade of home builders continues to redirect their attention to the market. But it has not been nearly enough.

While 3CDC has done an incredible job at establishing a viable residential market in Over-the-Rhine, they have only produced a few hundred units over the past decade. Bigger projects in the central business district are turning historic office towers into posh residences, but are doing so at about 100 units per project. Even the long-planned residential tower at Fourth and Race Streets will only include 208 units once it is complete several years from now.

The rate of production at The Banks, which is by far the largest development in the center city, only averages out to a couple dozen units per year when you consider the time it continues to take to build out that massive undertaking.

Something bigger is needed. Something much bigger. Here are two options.

City Hall Quarters
Cincinnati’s majestic City Hall is unfortunately surrounded by decrepit, low-slung parking garages and a smattering of parking lots. The area’s proud history, however, can still be seen by taking a leisurely walk along Ninth Street. There, one can view the regal structures that were the original homes of Cincinnati’s economic and political elite.

Just around the corner, however, is a collection of parking lots controlled by collection of different limited liability companies. The original owner of the lots, if it is different from now, had long-planned to build offices on the site similar in nature to what was developed on its north side along Central Parkway. That building was completed in 1983, and times have certainly changed since then.

The large collection of parking lots allows for a unique opportunity to create a residential sub-district within the central business district. Look to Atlanta’s West Midtown, Chicago’s South Loop or Denver’s Cherry Creek District of examples of the type of development that could rise here.

Its density would respect its historic surroundings, but its scale could provide hundreds of residential units. Instead of lining each street with retail, thoughtfully placed corner markets and cafes could be placed intermittently in order to maintain a residential character for the sub-district.

CL&N Heights
Like its Broadway Commons neighbor to the north, this area was once part of the large warehouse district that previously occupied the site with the CL&N Railway. Those proud buildings, and the history that went along with them, are now largely gone and have been replaced by I-71. There are, however, some of the historic warehouse structures that can still be seen in the Eighth Street Design District and immediately to the south.

This collection of parking lots is largely out of site since they sit beneath I-71 and at a lower grade than the rest of the central business district. Procter & Gamble currently owns the vast majority of the site, but Eagle Realty has recently acquired some land with the interest of building a parking structure along with some office space.

Unlike the City Hall Quarters site, this location has an opportunity to go even bigger.

In order to properly develop the location, it would make most sense to raise the site up to the same level as the rest of the surrounding street grid. This would essentially create a situation akin to The Banks, where two or so levels of parking could be built as a platform, with the structures then rising from there.

Instead of building four- to five-story structures, like at The Banks or near City Hall, this site would be an ideal location for a handful of sleek, modern residential high-rises. In this case, think of Vancouver’s Yaletown or San Diego’s East Village near their ballpark.

In this location it is conceivable that four to five residential towers could be constructed, while also preserving some land for pocket parks and other neighborhood amenities. At such a scale and density, this site alone could produce upwards of a thousand residential units.

Like the City Hall Quarters site, there would be no strong need to build retail as part of this project. Instead, a small collection of service offerings, like dry cleaners and convenience stores, could be built as part of the development, thus allowing the new influx of residents to bolster the existing and potential retail offerings in the central business district and Over-the-Rhine.

Both development sites include their challenges, but they offer immense opportunities to not only provide the much-needed injection of housing, but also improve the city’s tax base, hold down skyrocketing residential prices, bolster center city retail, and rid the city of two of its largest-remaining surface parking lots.

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Business Development News

Oscar Bedolla Looking to ‘Rally the Troops’ and Streamline Department in New Role

Nearly four months into his new job, Cincinnati Department of Trade & Development Director Oscar Bedolla says that his department is already working to streamline its services to continue to grow confidence that Cincinnati is “open for business.”

His remarks came yesterday afternoon at Horseshoe Casino Cincinnati during a luncheon held by CREW Greater Cincinnati, a professional organization dedicated to providing growth and networking opportunities for people in the commercial real estate industry.

Bedolla came to Cincinnati from New York City, where he served as a vice president in KPMG’s Advisory Practice. In that role, he specialized in project finance and public-private partnerships. He now leads a department with an annual budget of $50 million and approximately 100 employees, who are charged with managing everything from large-scale development projects and housing to human services and the City’s parking assets.

So far his biggest challenge has been rallying the troops and getting everybody on the same page, saying, “People get stuck in a rut and don’t realize that we have to continue to build confidence in the [Cincinnati] market.”

To build that confidence and share it with potential investors, Bedolla said he is building a highly professional staff that understands both the public and private sectors, with a foundation built upon collaboration and innovation sharing.

“The cities I have worked with that have done well are the ones who have implemented things like CitiStat,” Bedolla said, referring to the real-time, data-driven city department performance program developed 15 years ago in Baltimore and soon to be brought here through the City’s new Office of Performance & Data Analytics.

Once that has been accomplished, he says that the real work can begin on the two major areas where he sees opportunity for Cincinnati: capturing and leveraging foreign direct investment, and increasing manufacturing productivity by taking advantage of the City’s legacy infrastructure.

“Cincinnati, with its location, is uniquely placed to be a much larger economy than it is right now,” Bedolla told the group of approximately 75 people who attended the luncheon. “We could see an influx of capital into mature markets [like Cincinnati] if Cincinnati brands itself.”

The next CREW Greater Cincinnati luncheon will once again be held at Horseshoe Casino Cincinnati, and will take place on Tuesday, April 14. Registration is not yet open.

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Development News

Final Designs Coming Into Clarity for $23M SCPA Redevelopment

Core Redevelopment purchased the former School for Creative & Performing Arts (SCPA) in December 2012 for $1.3 million. The 107-year-old building was originally built as Woodward High School, and Core has been planning redevelop the property since their purchase.

Plans for the $23 million redevelopment have fluctuated since Core became involved. At first the concept was to develop apartments, but then the Indianapolis-based developer looked at transforming the building into a boutique hotel. The hotel concept moved so far along that Core was in final negotiations with AC Hotels in June 2013. At the time, it would have been one of the first in North America, but the deal later fell through and AC Hotels announced that they would enter the Cincinnati market at a lifestyle center in Liberty Township.

Located in Pendleton, SCPA has a rich history that dates back to the early 19th century when the original two-story Woodward High School was established there. At the time, it was heralded as the first public school west of the Alleghenies. SCPA started to take control of parts of the building in 1976, and eventually expanded into the entire structure in 1977.

“We will continue to honor William Woodward and Abigail Cutter by working with the William Woodward Museum to enhance the memorial located on the east side of the site,” stated Core.

The 4.6-acre site is bordered by Thirteenth Street to the south, Sycamore Street to the west, Fourteenth Street to the north and Broadway Street to the east. The historic school is situated on the south edge of the parcel and is currently surrounded by parking on three sides. The northern side of the block contains Cutter Playground, which in recent years has fallen into disuse and is viewed by many neighbors as an under-performing asset.

The park has served as the focal point of discussions regarding the redevelopment of the property. The developers have proposed a variety of concepts that would build varying amounts of parking on parts of the park. The most recent proposal, which is supported by many community members, includes a condensed parking footprint and a partially submerged two-level parking deck.

In addition to developing 148 new apartments and 196 parking spaces, Core plans to remove most all of the existing pavement currently in front of the building’s main entrance along Thirteenth Street. Small access lots would remain on the building’s east and west sides, and the two-level parking deck would be constructed on the rear of the existing five-story structure.

Rents for the apartments, which will run from 500 to 2,000 square feet, are expected to range from $700 to $1,500 per month.

“Maintaining as much of the open space as possible to the north of the building while enhancing the remaining open space through the use of landscaping is also one of our goals.”

The most recent revisions are currently making their way through the approval process at City Hall, but this rendition appears to have the best shot at getting approved. If all goes according to plan, Core intends to begin construction within the next two months and welcome the first residents in Spring 2016.

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News Transportation

Megabus, Greyhound Open to Idea of Relocating Into Riverfront Transit Center

Second Street Entrance to the Riverfront Transit Center [Randy Simes]

Following UrbanCincy’s story on the ongoing struggles between the City of Cincinnati and Megabus, the two largest intercity bus operators have come forward and expressed a willingness to discuss relocating to the Riverfront Transit Center.

The conversations started after Megabus was forced to move its downtown Cincinnati stop this past autumn – marking latest in a series of moves forced by City officials following complaints from surrounding property and business owners.

“Local businesses, through City Hall, requested megabus.com move from 1213 W. Central Parkway to our new present location at 691 Gest Street,” Sean Hughes, Associate Director of Corporate Affairs at Coach USA North America, explained to UrbanCincy. “Megabus.com would love to be in the Riverfront Transit Center, but that was not a viable option because of Riverfront Transit Center operational concerns.”

The issue extends beyond the various intercity bus operators and City Hall. Since the Southwest Ohio Regional Transit Authority (SORTA) operates the facility for the City, and collects annual revenues from it. In October, SORTA officials told UrbanCincy that expanding operations within the Riverfront Transit Center is possible, due to its large excess capacity, but would bring additional costs.

“It’s our understanding that Megabus pays a fee to share transit facilities in other cities,” Sallie Hilvers, Metro’s Executive Director of Communications, said at the time. “As a tax-supported public service, Metro would need to recover the increased costs related to maintenance, utilities, security, etc. from Megabus, which is a for-profit company.”

At the same time, there appears to be growing pressures for Greyhound, which has been operating in Cincinnati since 1976, to potentially find a new location as it is crowded out by new development surrounding the Horseshoe Casino.

While Greyhound and SORTA have engaged in conversations in the past about relocating Greyhound’s operations to the Riverfront Transit Center, little progress has been made; and the two sides still appear to be at a standstill, albeit a softening one.

“No decisions on that front have been made that this time,” Lanesha Gipson, Senior Communications Specialist with Greyhound, commented with regard to relocating to the Riverfront Transit Center. “All potential relocations have to be analyzed and be in the best interest of everyone – the customers, the company and the community – before a decision is made as to whether or not we should relocate our operations.”

With both Greyhound and Megabus thriving as an increasing number of people ditch their cars and plane travel for short trips – less than 500 miles – these conversations appear to only be in the early stages.

While all parties agree that some legal, regulatory and logistical issues would need to be resolved prior to establishing the Riverfront Transit Center as Cincinnati’s intercity bus terminal, it sounds like the primary issue is the financial arrangement. Until then, intercity bus passengers will continue to be plagued by continuously moving and inconvenient stations for the region’s two largest operators; and an underutilized transit facility sitting beneath Second Street.

“Megabus.com continues to work with SORTA to find a permanent location for our stop in Cincinnati,” Hughes noted. “Megabus.com has an annual passenger spend of $8.2 million in Cincinnati and we look forward to serving the city by giving passengers a safe, environmentally friendly way to travel.”