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Cincinnati: Downtown: Eighth & Main Redevelopment

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^That was a little depressing. The article said they needed $590/sq. ft. to make the condo project work, whereas downtown condos are currently getting around $400.

 

That is such a large gap, I'm sort of amazed that the design team had to take this long (and so much work) to arrive at this conclusion. Were they thinking that the downtown market would spike that high by now?

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I thought it was a bit weird to have condos on that corner without a garage for parking. If I were buying a condo, I would expect to have parking. Not so much for an apartment. Plus apartment dwellers in cities are younger and can deal without a car much better. If I am going to pay close to $500k for 800 sq ft. I would expect a parking spot.

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I seem to remember reading at one point that if they could get help from the City, they could set a new "bar" for pricing around $500 per square foot, which would help other developers in gauging pricing for new projects downtown.  However, since the real numbers showed $590 per square foot and the city wasn't willing to help out, then they had to scrap it.

 

Too bad, I hope Greiwe isn't turned off by downtown and takes a look at some other spots downtown for some condos

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Having a building that is 1/3 parking garage and only has 30 units to offset the costs of building a new tower is problematic in a market like Cincinnati's. Having a fully occupied building with 4x the units will definitely work out nicer for the new developer.

 

We really need to get on the "condo but with no attached parking" trend. It works fine in other places and we need to push for it. Parking garages in towers are insanely expensive to build.

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I love the fact that they want to include microapartments in this new plan. (Strangely this wasn't mentioned in the Business Courier article, but if you pull up the HCB packet, you can see the plan.) This is exactly what downtown needs right now -- small apartments for people who want a cheaper living space and will spend most of their time out in the city anyway. Right now, too many developers are building big apartments in the urban core and potential renters are getting spooked by the high costs, especially when rents are still dirt cheap in surrounding neighborhood and Northern Kentucky.

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Seriously. It seems like all the big developers think the only thing they should be building are single family townhomes or large luxury units. Which in a market like Cincinnati generally don't have the highest profit/square foot. A building filled with smaller units does more for the core than one filled with luxury units and will make it easier to get a good ROI.

 

Plus, as much as I think we need more condos, rentals mean there's less of a chance of financing falling through since banks aren't going to be looking for presales like they would with a building like the one Greiwe planned.

 

I never did multifamily work while in Cincinnati. Does anyone know if the code has density regulations? Here in NYC you can build as small as you want but you have to average a certain square footage. So if you have a building that's 10,000 square feet and you have a Dwelling Unit Factor of 680 (the lowest amount of any of the residential districts) the most units you could have is 14. You could do 13 micro units of 230 square feet (about as small as you can get to fit within spatial regulations for certain rooms in NYC) but that 14th unit would need to be about 3,000 square feet to make up the difference to average out to the necessary amount.

 

Does Cincinnati have something like that in place?

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^ Whether it is in place or not, is the Cincy market ready to support a micro unit?  To build a 230 sq ft micro unit new, the rents would still have to be somewhere in the $500-700 range (new construction). I imagine a larger studio or one bed in a place like Plum St Lofts or another building like that would not rent for much more than the brand new micro unit.

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It's easier to finance and faster to construct single-family homes than any sort of multi-family, be it apartments or condos. An established developer can get the construction loans to throw up five houses as easily as the average person can get a credit card with a $3,000 limit.  Towne and the rest will make 20%+ on those homes on and near Elm St.  It's shooting fish in a barrel for an established company. 

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^ Whether it is in place or not, is the Cincy market ready to support a micro unit?  To build a 230 sq ft micro unit new, the rents would still have to be somewhere in the $500-700 range (new construction). I imagine a larger studio or one bed in a place like Plum St Lofts or another building like that would not rent for much more than the brand new micro unit.

 

I guess we'll have to wait for some of these units to come on the market and see. Based on the success of these units in other cities, and some anecdotes that some members of this forum have posted, it seems like there is at least some demand. Here's what Jim Uber posted in another thread:

 

Incidentally, to anyone who is interested in developing a property in OTR, after my (first time) experience entering the rental market as a landlord, there is surprising pressure for good quality and inexpensive 1-BR units in OTR (<=$800/month). I think this is likely to be true whether south of Liberty or near Findlay market. I mean, you put the listing out there and you better allocate the better part of your next few days interacting with people.

 

So you may be thinking that this is obvious. But where this takes me - and I hadn't really realized it - is that we should be prioritizing the development of many, many more small units than are being done now, so that the above price point works. For example if you need to rent for $2/sq. ft. to make the project a good one, then I think that 400 sq. ft. units would rent no problem at all. Good people just want to live here, and they have budget constraints, but they care a lot less about how much space they have. I was originally a little nervous about showing 500 sq. ft. apartments and they were by far the most popular and I never had one person say it was small.

 

And the quality of tenants looking for that type of unit seems high. I met many people in their 20s who were just starting out and making maybe $3,000 a month, had some student loans, and they wanted flexibility in their budget to save and do other things. It was really refreshing. A few people even came with their parents! I mean, a gaggle of mom and pop and siblings who had lived forever in the suburbs and now being pulled out into the world by their 22 year old who just finished college.

 

Anyway, if I were to be looking for properties to redevelop right now in OTR, I'd be looking for buildings that lent themselves to mostly 350-450 sq. ft. units, put in nice finishes, and rent them for $1.75-$2/ft. OTR will be a better place with a lot more of those units and a lot more of those people that would flock to fill them.

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^ outside of NYC, San Fran and DC, do you know of other areas where micro units may be working?

 

I would be interested to see if they are being built in more peer markets like Minneapolis, Charlotte, Columbus, Nashville, etc.

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I'm curious how big these "micro units" will actually be. Because 400 square foot studios don't really have any issues in OTR or Downtown. My building had 12 studios all under 470 square feet and were sold out before the one or two bedroom units.

 

The 400 square foot studio in Parvis was renting for 800-900/month. And when I toured there (not looking for a place so I wasn't trying to just be sold on demand) the guy from 3CDC mentioned that it was one of the most sought after units in the building.

 

There are a near endless stream of young people who have no desire for a big residence or to own many things. These types of units are perfect for them.

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Intuitively, a brand new 350-450 sf apartment in the $600-$900/month range should work well in CBD/OTR. At that size you can still get some psychological separation between "living" and "sleeping" areas. You might be able to justify even higher prices if the building itself has some extra amenities. Throw in a storage unit and you don't even really have to commit to the minimalist lifestyle. Going down to 250 sf is a real lifestyle commitment.

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Yeah for sure. Because most studios are in the 400-500 square foot studio in OTR or Downtown anyway. Micro implies something significantly smaller than the norm. Most of the time it is defined as something below 400 square feet, normally in the 250-350 square foot range. A range that requires the combination of daily-use spaces such as living/sleeping or living/dining or living/sleeping/dining. A 450 square foot studio allows for all three to happen separately if you so choose and it still won't feel cramped. I'd know as I lived in a 468 square foot studio and there was plenty of room left over but it still had a sleeping area, a four person dining table, and a living area that had a couch and two side chairs. That amount of space is very livable for an individual or two people who have no problem being with each other 100% of the time.

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600 square feet is such a typical square footage for a one bedroom...that's not micro at all. I just laid out a 234 square foot studio in a building today. THAT is micro.

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600 square feet is such a typical square footage for a one bedroom...that's not micro at all. I just laid out a 234 square foot studio in a building today. THAT is micro.

 

are you an architect?

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Yeah. I finished grad school in 2014, worked for a couple years full time in Cincy and moved to NYC in June and work in Manhattan now.

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Cool! Glad my presence here is viewed favorably by someone haha.

 

These forums are how I live vicariously in Cincinnati and Cleveland since I don't get to see them that often anymore. And developments like this one are still exciting to see happening and evolving even if they won't be a part of my day to day life.

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North American Properties buys downtown building for development

 

North American Properties has purchased a downtown Cincinnati building for a potential apartment development.

 

North American Properties purchased 711 and 719 Main St. from Elka Real Estate Co. Ltd. for $860,500, according to property records. The downtown-based commercial real estate company paid cash for the building and adjacent parking lot.

 

More below:

https://www.bizjournals.com/cincinnati/news/2017/08/02/exclusive-north-american-properties-buys-downtown.html


"You don't just walk into a bar and mix it up by calling a girl fat" - buildingcincinnati speaking about new forumers

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Though I'd be sad to see the Donato's building go since it's a nice scale and could be a good contributor if the upper floors were occupied, a 14 and a 15 story building coming to Main Street may be worth it.

 

I've been hearing rumblings about these for awhile now but nothing official enough to get excited. Do you have a source?

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Though I'd be sad to see the Donato's building go since it's a nice scale and could be a good contributor if the upper floors were occupied, a 14 and a 15 story building coming to Main Street may be worth it.

 

I've been hearing rumblings about these for awhile now but nothing official enough to get excited. Do you have a source?

 

I have been in this building on a couple of site surveys, The building is so cut up from different users and programs,  the floor heights are extremely low that it would have been difficult to reuse the building. The upper floors do not meet any building or fire codes. The original owners looked at a number of scenarios and with the age of the building it would have taken a massive construction overhaul, and an expensive cost to make the building viable on the upper floors. Grant it that the building is historical, but the proposed project will be a nice swap out compared to Joseph's tear it down and build a "park" plan.

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Though I'd be sad to see the Donato's building go since it's a nice scale and could be a good contributor if the upper floors were occupied, a 14 and a 15 story building coming to Main Street may be worth it.

 

I've been hearing rumblings about these for awhile now but nothing official enough to get excited. Do you have a source?

 

Welcome to the forum!

 

If you go back through this thread you will see all the different iterations this project has went through. It actually went in front of Historic Conservation Board and got approved, although the plan was for condos at that point. Then another developer took over and wanted to do apartments but within the exact same building footprint. The sale of the land a few days ago shows that the project is still moving forward to some degree.

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Though I'd be sad to see the Donato's building go since it's a nice scale and could be a good contributor if the upper floors were occupied, a 14 and a 15 story building coming to Main Street may be worth it.

 

I've been hearing rumblings about these for awhile now but nothing official enough to get excited. Do you have a source?

 

Welcome to the forum!

 

If you go back through this thread you will see all the different iterations this project has went through. It actually went in front of Historic Conservation Board and got approved, although the plan was for condos at that point. Then another developer took over and wanted to do apartments but within the exact same building footprint. The sale of the land a few days ago shows that the project is still moving forward to some degree.

 

I think it shows that it is going forward at a much higher certainly then "some degree". The question is: what is "it". No developer is going to buy that building if they don't have some sort of plan for it. In it's current state it looses money every month, according to the current owner. Something will happen there now that a developer has bought the building.

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^ Is the Kaplan family, who owned the Donato's bldg. seemingly forever, contending that it loses money or is it NorthAmerican Properties? 

 

If it's the Kaplans, I suppose if the property taxes are high (too lazy to check) that's possible, but I know from years of observation that the they did THE bare minimum, if even that, when it came to maintenance.  They really really neglected it.  Without knowing the rent they pay, I suspect the Donato's lease was the best thing to happen to that bldg. in decades, once the old Kay Furniture Store (a Kaplan family enterprise) went out of business 30+/- years ago.  On the other hand, if it's NorthAmerican making the claim, it makes sense since they apparently paid over $800,000 for it. 

 

Does anyone know when the Donato's lease expires, or if NorthAmerican plans to buy out the remainder of the term?

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This might be overly trivial of me to mention (sorry I'm still new here), but North American Properties seems to have applied for a demo/new building permit for the southwest corner of 8th and Main, 721 Main Street. That was February 5th, so it seems like things are indeed moving along here.

 

Here's the link: https://cagis.hamilton-co.org/opal/apd.aspx?QSPerm=2018P01085

 

 

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This might be overly trivial of me to mention (sorry I'm still new here), but North American Properties seems to have applied for a demo/new building permit for the southwest corner of 8th and Main, 721 Main Street. That was February 5th, so it seems like things are indeed moving along here.

 

Here's the link: https://cagis.hamilton-co.org/opal/apd.aspx?QSPerm=2018P01085

That is a good sign that the project is moving forward. In the past, the developer promised to not tear down the existing building until all financing/details were in place to begin construction on new building.

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The demo permit, along with two permits for foundation and tower work have been approved by the City.

 

My best guess is Donato's will be out in a few months and the building will be down by the end of summer.


“All truly great thoughts are conceived while walking.”
-Friedrich Nietzsche

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The demo permit, along with two permits for foundation and tower work have been approved by the City.

 

My best guess is Donato's will be out in a few months and the building will be down by the end of summer.

 

Hope they have the financing for the new construction lined up and locked in.


www.cincinnatiideas.com

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Hope they have the financing for the new construction lined up and locked in.

 

Yeah, I don't think that we should ever be permitting the demolition of historic buildings if the financing isn't essentially locked in escrow.  But I have little faith that this is what is going on.

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