CINCINNATI - The rusty hulk that has marred the Kenwood landscape off of I-71 since 2009 is about to get a nip and tuck. Work starts this week to enclose and complete the office tower at The Kenwood Collection.
“Please don’t call it a rusting hulk. We’re just going to transform it into a beautiful diamond,” David Birdsall, president of the Phillips Edison Strategic Investment Fund, said in an exclusive interview with WCPO.
Birdsall leads an investment group that bought the former Kenwood Towne Place project out of foreclosure in 2012. He rebranded the project as The Kenwood Collection and is planning to spend $200 million to add office and upscale retail tenants to the property.
Saks Fifth Avenue has agreed to relocate its downtown Cincinnati store to the site in 2016. Birdsall told WCPO in February that he hopes to attract “another 30 to 40 smaller shop tenants … higher end, boutique, new-to-market retailers.”
Birdsall first brought construction crews to the site in January, but the most noticeable work is scheduled to start this week: Enclosing the half-finished office tower whose steel skeleton became a symbol for the recession’s impact on Cincinnati’s commercial real estate market.
“It’s going to start to take shape definitely this summer,” Birdsall said. “By the end of the summer you’re going to see a substantially different view on I-71.”
Engineering and construction professionals have assured Birdsall that the oxidized beams on the Kenwood building’s steel frame are structurally sound.
“The rusting pieces that need to be replaced we’ll replace them but for the most part … it’s really just oxidation,” he said. “It’s created a coating but structurally we’re fine.”
Birdsall hired commercial real estate firm Jones Lang LaSalle to lease the 284,000-square-foot office building.
“We’ve got a ton of demand,” he said. “We’ve signed Neace Lukens (as the first anchor tenant). And we have another three floors that we’re in serious engagement in. Hopefully, we’ll be able to announce some things this spring.”
Neace Lukens is an insurance company headquartered in Louisville, Ky. with offices throughout the Midwest and South. The company will move their Cincinnati offices to the Kenwood location.
Birdsall wouldn’t identify prospective tenants but the list includes financial service companies, IT and marketing firms, said Rusty Myers, executive vice president and Jones Lang LaSalle. Demand is strong enough that the project’s original lease rate of $17.95 per square foot could be increased soon. Myers thinks the building can be filled in 12 to 15 months.
“We have some really good activity now,” Myers said, from companies “where that mixed use amenity base is important in recruitment … as well as the high-profile easy-access location.”