CINCINNATI - Downtown Cincinnati will have its own grocery store by late 2015 after a plan was approved by City Council Wednesday.
Council's budget and finance committee gave its tentative OK Monday afternoon to a plan that calls for granting a $12 million forgivable loan to the developer behind the project.
Flaherty & Collins, an Indianapolis company, wants to build a 300-unit apartment tower at the corner of Fourth and Race streets, which currently is the site of the aging, dilapidated Pogue's parking garage.
A 15,000-square-foot grocery store would be included on the ground floor of the project, said developer David Flaherty.
"I'm excited about this," said City Councilwoman Laure Quinlivan. "This is the biggest thing to happen downtown in a long time."
As part of the project, nearby Tower Place Mall would be renovated. Only street-level retail would remain at the site, and 1,000 new parking spaces would be built atop the space.
The city of Cincinnati bought the financially struggling Tower Place Mall and adjacent Pogue's garage earlier this year. Nearly vacant, Tower Place was losing an estimated $850,000 yearly.
The overall project will cost about $80 million, with roughly $60 million-plus coming from private sources arranged by the developer.
The full City Council voted on the deal Wednesday. Flaherty said construction could begin later this year and the project would be completed in about 24 months.
Cincinnati officials said the project would help the city achieve its goal of attracting 3,000 to 5,000 new residents downtown in the next two years.
Flaherty & Collins operates about 75 real estate projects nationwide. The firm's specialty is in-fill development in Midwest urban areas.
The firm has wanted to construct a project of this type in Cincinnati since 2006, but the plans were delayed due to the financial downturn of 2008, Flaherty said.
An independent grocer selected by the developer would operate Cincinnati's facility, Flaherty added. It would be similar to downtown groceries that are successful in Cleveland, Kansas City and Minneapolis.
"This is a very under-served market," Flaherty said, referring to downtown Cincinnati.
Under terms of the deal, the grocery would be open 7 a.m. to 10 p.m. daily. It would focus on fresh foods and also offer prepared meals for purchase. Additionally, it likely will have a mezzanine where customers could dine on-site.
Flaherty & Collins agreed to keep the grocery open for at least five years. If it were to close before that time, the developer must repay the $12 million loan to the city.
Money for the loan comes from an urban redevelopment account that is funded by taxes paid by downtown property owners. The account may only be used for construction projects downtown, and not for operating expenses at City Hall.
"This is a specific pot of money that can be used for specific purposes in a specific geographical area," said Councilman P.G. Sittenfeld.
The 30-story apartment tower would have units with rents in the $1,000 to $2,000 range, Flaherty said.
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