Recent Corporex deals making Northern Kentucky riverfront hot property again

RiverCenter, Ovation taking big steps forward
Posted at 1:01 PM, Aug 18, 2016
and last updated 2016-08-18 13:01:49-04

COVINGTON, Ky. -- The straw that stirs the drink is getting active again on Northern Kentucky’s riverfront.

Corporex Companies LLC struck three recent deals that could have long-term impacts on the Covington and Newport waterfronts.

Two involve the recruitment of new company headquarters that could bring up to 800 jobs to the RiverCenter office complex. A third involves a long-planned land deal that puts a key puzzle piece in place for the massive Ovation project in Newport.

All three deals are welcome news for job-creation veterans like Dan Tobergte, president and CEO of Northern Kentucky Tri-County Economic Development Corp.

“It’s pure evidence that the urban core is quite attractive to millennials and the future workforce,” Tobergte said. “Corporex is a headquartered commercial real estate company with big interests in Denver and elsewhere. They’re certainly going to evaluate where their best return on investment is going to be. If they can become further satisfied that it’s better here, we’ll start seeing more interest by Corporex here, which is good to see.”

Corporex comeback?

When it comes to stoking growth, few can match the Northern Kentucky track record of Corporex CEO Bill Butler.

The Covington native grew Corporex “from a one-man construction company to a diversified real estate company with more than $1 billion in assets,” according to his official corporate biography.

Along the way, Butler made friends and foes from his hyper-involvement in economic development endeavors, including the Forward Quest regional planning initiative, the formation of the Tri-ED and the creation of a Covington skyline with RiverCenter’s twin towers, Madison Place and the Ascent luxury condo building.

A similar impact is possible near the mouth of the Licking River, where Corporex purchased a 2.75-acre site in late July, the last piece needed for the first phase of the $1 billion Ovation project.

“This piece of ground means we now own about 65 percent of the land within the development district,” said Tom Banta, managing director of the Covington-based development company. “With 15 acres of land, you can do as big a project as you need. The remaining parcels we don’t control are kind of the southern and eastern edge properties. So, we can still do an incredible development just on what we control even if we didn’t acquire another piece of ground there.”

Corporex has been tight-lipped about its initial plans for Ovation, but Banta said this could be the year Ovation takes a major step forward. The pre-recession development plan for Ovation contemplated up to 1.5 million square feet of office space, 1,000 residential units and a 3,500-seat entertainment venue. But Banta said the project will not look like the 2007 rendering that shows a circular array of high-rise condo towers.

Ovation rendering in 2007

“You couldn’t finance one of those today if you wanted to,” he said. “But it’ll be a major mixed-use development. I don’t think it’ll be a lot less dense. You’ve got to go with what the market needs and allows you, a different kind of residential, probably, town homes and ownership that’s different than big condo towers.”

Omnicare hole nearly filled

Banta’s more immediate concern is filling what Corporex has already built in Covington. The company took a big step in that direction this week with the recruitment of a CTI Clinical and Consulting Services to a 125,000-square-foot space in the 16-story Rivercenter II office building.

Banta said the lease brings the occupancy rate in the twin towers to 88 percent. Tobergte said that figure could climb above 90 percent if Corporex can finalize lease terms with Clubessential, a software company that is considering a $10 million headquarters relocation.

Both deals received tax-incentive offers from the Kentucky Economic Development Finance Authority, or KEDFA.

  • CTI is a 17-year-old company that conducts clinical trials to measure the effectiveness of new medications in critically ill patient populations. It will relocate its headquarters from Blue Ash to Covington as part of a $36.4 million development deal that includes up to $14 million in state incentives, authorized by KEDFA Wednesday. Tobergte expects CTI to relocate 200 jobs to RiverCenter by November. Up to 500 additional jobs would trigger tax credits that are aimed at encouraging the creation of new jobs paying an average wage of $40 per hour including benefits. CTI is also eligible for reduced-cost training benefits through the Kentucky Skills Network. And it will have access to a new auditorium that state officials agreed to build at the Northern Kentucky Convention Center.

“CTI is an international company that spends an enormous amount of resources on training staff and clients about the protocols they’re doing,” Banta said. “So, training is a huge issue in this particular deal. The state could justify spending the money on the convention center because of the deal. Now, the convention center has something to offer that they haven’t had in the past. And this company has something they could use for training.”

  • Clubessential is a Columbia Tusculum-based company that specializes in software that helps private health clubs manage their business affairs. The company would receive up to $600,000 in Kentucky tax incentives to relocate up to 100 jobs to a 32,000 space at RiverCenter, Tobergte said. Such a deal would bring RiverCenter’s occupancy to 92 percent, not including a 200,000-square-foot space that Nielsen once occupied at the 11-story Madison Place tower.

Madison Place

Tobergte said the recent Corporex deals solidify the Covington riverfront as a headquarters location. Banta said they continue the resurgence of Cincinnati’s urban core as a place where companies can attract talent.

“Companies are returning to the urban core because that’s where they can hire employees,” Banta said. “That is just great for the long-term viability of these urban centers. General Electric was a great example of it on the Ohio side of the river. CTI is a great example on this side.”