LIBERTY TWP., Ohio - The Liberty Center project has yet to meet six of the 14 contingencies required to receive $31 million in public financing for the $300 million mega shopping, office and entertainment development, according to records obtained by WCPO.
Despite the potential funding glitch, Columbus developer Steiner + Associates says the project remains on target for a fall 2015 opening.
“All aspects of the project are proceeding on the expected pace,” said Steiner spokesman Brock Schmalz.
The contingencies are required under a master development agreement that binds Butler County, Liberty Township and Libertytown LLC to certain obligations for the 100-acre project off I-75 and Ohio State Route 129. Libertytown is a corporate entity organized by Steiner and Bucksbaum Retail Properties of Chicago, which are partners in the development.
Plans call for a 65-acre first phase that includes more than 800,000 in retail space and a Cobb Theaters CineBistro, along with apartment, office and hotel properties that would be separately financed, not part of the $300 million project price tag.
Steiner has previously announced that the project is 50 percent leased , with Dillard’s and Dick’s Sporting Goods identified as anchor tenants.
Butler County Administrator Charles Young said in early May that the county was “very close” to issuing $10 million in bonds for the project. That funding would be issued jointly with a $5 million from Liberty Township and $16 million from a New Community Authority that can issue debt backed by revenue from tenant assessments.
To receive the public funding, the contract requires the developer to meet 14 contingencies. Many have already been met, including the formation of the Liberty Community Authority, the submission of a development schedule and commercial budget showing at least $192.5 million in privately financed construction. The developer is also up to date on the receipt of building permits, environmental approvals and zoning compliance.
In all, eight contingencies are satisfied, based on a May 16 letter to Libertytown LLC from attorneys for the county and township. The letter was obtained through an open records request. Attorney Tom Gabelman, who represents Butler County, said Monday that is the most recent communication from the county and township on the issue of contingencies.
Among the conditions yet to be met by developers are those dealing with tenant mix, the developers’ equity contribution and an operation and management agreement that requires developers to maintain the property in “a first class manner” comparable to Easton Town Center in Columbus.
The tenant-related contingencies indicate Butler County and Liberty Township have approved Dillard’s as a retail anchor and Dick’s as a “junior anchor.” But it has yet to sign off on a contingency requiring a third retail anchor or a combination of 10 “Category A” retailers who must meet comparable in quality and “levels of attraction” to tenants now operating at Easton or The Greene in Beavercreek, Ohio.
“Information received to date by the public parties regarding executed leases and leases out for signature is insufficient for the public parties to reasonably expect that the tenant mix will satisfy the requirements” of the master development agreement, the letter states.
Another point of contention is the developers’ equity contribution. Steiner has said development partners will invest $80 million in the project – in addition to a bank loan of about $160 million – but the private financing is contingent the county’s approval of public financing .
The May 16 letter criticized the “subjective nature” of contract terms in an “Equity Conversion Agreement” proposed by the developer in February. Attorneys for the county and township objected to a clause that allows one equity partner "to withhold the Equity Conversion Notice at its sole discretion."
The name of the equity partner is blacked out in the letter obtained by WCPO.
Butler County Administrator Charlie Young declined to reveal the name. He said the county is prepared to issue bond debt within three weeks of all contingencies being satisfied.
“They have to invest a significant amount of equity before financing comes into play,” said Young. “From my perspective, they’re working, constructing things, getting permits and they’re saying their construction schedule is on track to complete on time. They’re moving forward with investment of equity … and aren’t yet at a point where they require the infusion of public financing.”
“We do want it to open in September, 2015,” he added. “They’ve indicated they’re on track to do so.”