QUEENSGATE 2010 DEVELOPMENT INITIATIVE and the …



QUEENSGATE 2010 DEVELOPMENT INITIATIVE and the FORMATION of the QUEENSGATE DEVELOPMENT CORPORATION (QDC)

Background:

The 2008 Go Cincinnati Report recommended Queensgate as an economic development priority area for the City of Cincinnati to focus on and invest in. Aside from the standard benefits associated with why it is important to invest in area-wide economic development opportunities, such as increasing the city’s tax base, the Go Cincinnati Report also argued for investing in the Queensgate area because one of the Cincinnati region’s premier cultural arts institutions, the Cincinnati Museum Center, is located in the heart of Queensgate.

Founding Organization: Cincinnati Museum Center:

Based upon the recommendations made in the Go Cincinnati Report, in 2009 the Museum Center Board invested in the development of a concept plan study, to create a public/private development corporation focused on improving the Queensgate area. The study is titled, The “Queensgate Initiative” (QI). The QI study summarizes the major findings of the Go Cincinnati Report as it relates to the Queensgate area, provides additional analysis and outlines a series of objectives and next steps that will be required to begin the multi-year effort to redevelop the Queensgate area into a more beautiful, pedestrian friendly (accommodating bicycle lanes when feasible), sustainable, and economically vibrant area of Cincinnati. One of the major recommendations of the study is to form a “Catalytic Development Corporation” that would focus solely on improving Queensgate. Defining the purpose of what that public/private development corporation would be, how it would be organized, and who would provide the key staffing responsibilities are topics that this document will address.

The Right Timing is Now – 2010:

There are several reasons to begin a focused redevelopment effort of the Queensgate area. These are outlined in the following:

• In early 2010, Cincinnati’s City Manager, Milton Dohoney, began giving a standard speech to organizations throughout the Cincinnati region focused on the City of Cincinnati’s investment and development priorities now and in the coming years. Based upon the Go Cincinnati Report, the City Manager lists the Queensgate area as one of the three economic development priority investment areas for the future. In contrast to Uptown, Downtown and Over The Rhine (OTR) areas, which have nonprofit development corporations already organized and focused on carrying out economic development projects, Queensgate currently lacks such an organization. Therefore, now is the time for Queensgate and its leading business and nonprofit institutions, in collaboration with City officials, to establish its own nonprofit development corporation to carry forward a proactive redevelopment agenda designed to improve Queensgate in three phases:

o Immediate (within one year)

o Short-term (2 – 3 years)

o Long-term (4 – 10 years).

• Planning for a new I-75/I-71 bridge over the Ohio River is underway that will significantly alter the current road, street and Interstate ramping system, which will have a long-term impact on the south end of the Queensgate street network, thus effecting (positively or negatively) property uses and economic development for years to come. Note: it is believed that a bridge replacement project of this magnitude will generate various allocations of money from local, state and Federal sources given the future changes slated to be made to the Queensgate area’s infrastructure. Note: Queensgate representatives (and/or a newly created QDC) would be front-line advocates for how these funds would be spent. Further, the QDC would be included in the decision-making process that recommends any future changes to the current infrastructure.

• The private sector, City, State and Federal government has been trying to develop an intermodal barge/rail/trucking facility on the Ohio River at the south end of Queensgate but has not been able to accomplish the task. Some city leaders have speculated that a Queensgate type of development organization (such as the QDC) could assist in carrying out these types of multi-constituency development efforts. Note: the Federal government recently made approximately $2M available to the City of Cincinnati for intermodal riverfront planning work but at the time the City lacked a plan for how to spend the funds. In short, a newly established QDC would lead in the development of a plan for how to further port development, including collaboration with nearby neighborhood constituencies, as well as reapply to the Federal grant source for a reallocation.

• The Cincinnati Port Authority is experiencing a period of transformation, which could benefit from a more organized and active Queensgate business community defining what its needs are for the area. Note: In the future the QDC would advocate Queensgate area issues and projects to the Port Authority.

• In the future the City of Cincinnati wants to develop several Federal Brownfield “Job Readiness” grants to submit to the Federal government; these would focus on a number of available redevelopment projects located throughout the entire Queensgate area. Note: the QDC would be the lead advocate for devising grants designed to advance priority economic development initiatives.

• The City of Cincinnati’s Metropolitan Sewer District (MSD) is currently planning for a multi-year, $2 Billion infrastructure improvement program. Based upon preliminary discussions with City staff, the Queensgate area would likely be eligible for funding associated with various water mitigation/sustainability “Demonstration Projects” that could serve as a catalyst for new economic development projects throughout the Queensgate area. Note: MSD funds are generated and expended outside of the City’s yearly budget process and are not impacted by the City’s current budget deficit. QDC staff would collaborate with MSD on devising eco friendly, sustainable economic development projects.

• The City has just completed a major I-75 Master Plan Study from Mitchell Avenue to the north and the river and downtown area to the south. The entire east side of the Queensgate area is slated for major changes in the years to come. It is incumbent upon businesses and nonprofit organizations such as the Cincinnati Museum Center to maximize the benefits, while avoiding the liabilities, associated with such large scale proposed land-use alterations. Note: the QDC would be a key advocate for property and business owners interests from throughout the Queensgate area (which includes the Cincinnati Museum Center). Further, there will be a number of other projects competing for precious dollars along the entire seven mile corridor so it is in Queensgate’s interests to organize and compete for any available grant funds at the earliest possible date.

• A component of the I-75 Master Plan Study is the long-term restoration of the Mill Creek waterway that runs the entire north/south length of Queensgate. An open space plan with trails and other amenities has been planned for Mill Creek as it travels through Queensgate. Issues related to land use changes, road networks, right of ways, public and private property ownership and funding are all going to arise and need to be addressed for several years to come. Note: the Mill Creek Waterway restoration will present several design, construction and funding challenges. It is anticipated that the QDC would play a key role in helping advance solutions regarding these and other issues and implement the improvement plan.

• The City is currently engaged in a determined effort to establish a comprehensive streetcar transportation system that will connect several key business and visitor attraction nodes. While not on the primary spine between downtown and the university/hospital hill uptown area, planning for the Queensgate area should be factored in given the importance of the Cincinnati Museum Center and its close proximity to downtown and the OTR areas. Note: while such a system will take years to implement, there are other transportation options that could temporarily link the Cincinnati Museum Center to other visitor attraction/museum destinations in the Downtown/OTR area. The QDC would analyze, plan and advocate for these less expensive solutions.

• The state-wide 3C&D Rail Network linking Cincinnati, Columbus, Cleveland and Dayton by commuter rail received a $400M planning grant from the Federal government in 2010. The southern terminus of the line is Cincinnati. Public polls and City Council leadership have urged that the Union Terminal/Cincinnati Museum Center serve as the passenger station. Note: given the high volume of rail freight traffic through the Union Terminal area, it is necessary to begin the planning work at the earliest possible time.

• Adjacent to the Queensgate area is OTR, which is implementing a comprehensive and long-term redevelopment program. Queensgate’s Cincinnati’s Museum Center facility is on a street grid located in close proximity to major visitor attractions in the OTR, including Music Hall, Washington Park, Findlay Market, the new School for Creative and Performing Arts (SCPA) and a burgeoning arts district. In fact, a major street artery, Ezzard Charles, connects the Museum Center with Music Hall. Additionally, I-75, Central Ave and Gest Street immediately connect into the downtown street network which is less than one mile away. Given the close proximities and volume of economic development activity currently underway in OTR and Downtown Cincinnati, it is incumbent upon the Queensgate area (more specifically a newly established QDC) to undertake a similar level of planning and development in order to complement the development work underway in OTR and Downtown. Maximizing the business development capacity located in the Queensgate area, which is somewhat different than the typical economic generators found in OTR and Downtown, can only improve the City and the Cincinnati region’s economic development competitiveness and quality of life.

• While the Queensgate area has had a local business association operating for several years, this organization was not set up to take on a wide range of strategic activities associated with what the QDC would be charged to do. A QDC would include the standard range of operations associated with a nonprofit community development corporation such as:

o Owning real estate.

o Entering into real estate financial transactions.

o Creating joint-venture business agreements with other parties.

o Writing and submitting grant proposals to public and private entities as well as receiving, administering and auditing received monies.

o Participation in the submission of different types of land-use financial proposals to appropriate governmental bodies such as Tax Increment Financing (TIF), New Market Tax Credits and others.

o Carrying out a wide range of public policy related studies, when necessary, to further business and community development objectives of the QDC Board; this includes collaborating with other public and private entities carrying out work in the Queensgate area.

o Hiring staff, engaging consultants, conducting a yearly audit and other similar nonprofit activities.

• Regarding another rationale for pursing the development of a Queensgate Development Corporation, there are lessons to be learned from the past few years associated with economic development opportunities, such as the multi-modal port center business, that have, at least so far, not been able to proceed. Regrettably, these well intentioned efforts have expended significant financial investments resulting in protracted legal battles that ultimately lead to negative relationships among a combination of Queensgate business interests, the City of Cincinnati and local community neighborhood organizations and citizenry. Moreover, interested State and Federal investment funds have moved on to other municipalities along the Ohio River that show more promise for generating positive business development results as metropolitan regions, such as Cincinnati, compete economically with one another around the globe.

To summarize, some business development opportunities may have already been lost due to the lack of a Queensgate type of nonprofit advocacy corporation so it is important to learn these and other lessons in order to avoid missing out on new opportunities in the future. Note: once the QDC is established, representatives would communicate with DCI, OTR and the Uptown Consortium officials to engage in a lessons-learned review of how best to organize and implement an area-wide catalytic development corporation. This exercise would certainly benefit the QDC in getting underway and increase opportunities for successful collaboration with adjacent development corporations in the future.

Establishing the Queensgate Development Corporation (QDC):

Mission:

The mission of the QDC is broadly outlined in the QI document and reads as follows:

Create a new non-profit organization or expand the mission of an existing non-

profit organization (the preferred approach) to be the catalytic developer,

focusing on land assemblage, site remediation and horizontal development. This

organization will also be the “keeper of the flame” of the strategy. Said differently, QDC staff would engage private and public sector representatives to aggressively pursue whatever tasks need to be accomplished in order to sustain and expand existing businesses, institutions and neighborhoods as well as implementing new developments that improve Queensgate’s future.

As stated in the preceding, this proposal recommends that the QDC have some type of organizational affiliation with the Cincinnati Museum Center. The specific ways this unique partnership would be defined are to be determined once the future planning process is underway.

Board of Directors:

Informed by recommendations made in the QI document, a nonprofit QDC organization would be created with voting board member representation from the following stakeholders (additional ex-officio non-voting members could also be added):

• Cincinnati Museum Center (1 member)

• City of Cincinnati (2 members)

• Queensgate Business District (3 members)

• Energy industry (1 member)

• Neighborhood Association (2 total - 1 member each representing the Lower and Upper Price Hill Neighborhoods)

• Total: 9 members

Queensgate Business Roundtable:

It is recommended that a special Queensgate business leadership stakeholder group be convened to work closely with the staff and Board of Directors. Members would include individuals and organizations representing major investors in Queensgate such as:

• The Post Office (has a large operations facility)

• The Cincinnati Enquirer (has a printing facility)

• Queensgate Business Association (representing approximately 45 businesses)

• Anheuser Busch Distribution Facility

• Budco Group

• CSX Railroad

• Kahns

• Jergens

• Others

Advisory Board:

A Queensgate Advisory Board (to be engaged on an individual and/or group basis as circumstances warrant) would also be formed representing several local constituencies and organizations that are invested in the future of Queensgate and how to help the area improve:

• Water and Sewer District – City of Cincinnati

• Brownfields Office – City of Cincinnati

• Cincinnati Regional Transportation

• 3CDC

• Downtown Cincinnati Inc. (DCI)

• Cincinnati Port Authority

• Federal elected officials and staff representatives

• State elected officials and staff representatives

• Hamilton County Economic Development

• Mill Creek Waterway Restoration

• Ohio River Conservation

• Army Corps of Engineers

• University of Cincinnati

• Xavier University

• AIA

• Green/Sustainability organization representative

• Cultural Arts organization representative

• Agenda 360 (Southwest Ohio regional planning)

• Vision 2015 (Northern Kentucky regional planning)

QDC Characteristics and Initial Thrust

Characteristics of the future QDC include:

• Establishing a private sector led leadership group.

• Securing a multi-year financial base that enables the QDC to operate without being solely dependent upon public sector funding.

• Forging partnerships with other institutional investors participating in Queensgate redevelopment projects.

• Establishing a multi-faceted partnership with the City of Cincinnati regarding short and long-term redevelopment objectives that also results in funding support.

• Create a proactive and efficient decision-making process.

In addition to the participation of local stakeholder groups, it is recommended that the expertise of a small number of national subject matter experts be added to the collective Queensgate Advisory Board along with the planning and action team. The QI planning document outlined the role of the Advisory Committee in the following way:

There are a number of specific recommendations in the Go Cincinnati Report regarding

both workforce and transportation/infrastructure which significantly complement the

objectives and opportunities to pursue a redevelopment “green” strategy for

Queensgate/South Mill Creek. In addition, the Plan recommends twenty-eight success

metrics addressing implementation of the various recommendations of the Plan. With

respect to the industrial/R&D/flex market growth metrics in particular, the Go Cincinnati

Plan suggests the following:

• Create an advisory panel of national experts on green industrial park

development to guide the City’s planning to develop a green industrial park, and

include in this initiative visits to at least 2-3 green industrial parks identified as

best-in-class in the nation and meetings with officials involved in each park’s

development and with park tenants. These visits should be conducted by a team

comprised of City officials, developer representatives, and officials from

companies engaged in green-manufacturing initiatives that have a regional

presence including GE, Duke Energy, Toyota, and Procter & Gamble.

Implementation:

• Determine initial funding requirements for the first 2-3 years,

provided by the corporate and foundation community, and transition to

self-sufficiency by the end of year three.

• Develop a land plan for the eco-industrial park, determining the required

land that must be acquired, connections with nature, remediation, etc.

• The catalytic developer will be the recipient of surplus government and

other land in the boundaries of the area for eventual inclusion in the eco-

industrial park.

• Work with existing property owners and institutions which might coordinate

their development activities with the catalytic developer.

Hard Infrastructure

Examine the sewer, electrical, water and transportation capacity of the area.

This is particularly important given the sewer facilities location adjacent to the

probable location of the eco-industrial park.

Implementation:

• Determine the most appropriate means by which to provide water and

sewer treatment that is biologically based so as to achieve zero-

emissions.

• In joint venture with Duke Energy, provide the model for the region for

renewable generation of electricity for the green industrial park.

• Coordinate with the regional transportation studies underway, particularly

the rebuilding of I-75.

Soft Infrastructure

Revise the building codes to allow and encourage green standards as well as

incentivize the cooperation of land owners in achieving the strategy. Ensure that

there is sufficient neighborhood involvement to coordinate the Lower Price Hill

redevelopment with the eco-industrial park and other issues of concern.

Implementation:

• Develop building regulations which codify the goals of zero-emissions and

LEED certification for all building in the green industrial park.

• Ensure that there is rigorous adherence to established codes so that

“green” industrial uses do not offend neighboring residential communities.

• Have neighborhood representation on the board of the catalytic developer.

• Start a web site and newsletter to inform the surrounding community of the

planning process and implementation.

Long-Term Development Strategy

Defining the Queensgate Area:

To begin, the overall boundary of the Queensgate/Mill Creek under consideration is generally defined as the river to the south and the I-75/I-74 interchange to the north. It is further defined generally as I-75 to the east and State and Beekman Roads to the west. The redevelopment strategy will include the bordering Lower Price Hill neighborhood and the higher elevation neighborhood, Christian College and ancillary commercial areas.

Primary Development Thrust:

The primary business and community development thrust of the QDC going forward is explained in the following passage from the QI Report, which reads:

Given Cincinnati’s market leaders and product design and testing and life sciences - all

industries that show a proclivity for boutique R&D space often found by reclaiming older

industrial buildings – there is unique market opportunity to capitalize the rehabilitation of the buildings in South Mill Creek/Queensgate for these users. These buildings, if rehabilitated, could be done so in a “green” manner. The recycling of South Mill Creek

into the hub of “green” production in the region, and perhaps the nation, is indeed a

unique market opportunity that could catalyze development in this aging industrial stock

area.

The Go Cincinnati Plan sets forth a strategic direction for the Queensgate/South Mill

Creek Corridor going forward:

Development of an Eco-Industrial Park

The strategy for the Queensgate/Mill Creek Corridor is for a regional-serving

place that focuses primarily on the development of an eco-industrial park, a first

for the Upper Midwest and the Cincinnati area.

The main focus of the eco-industrial park development will be an industrial

park where the tenants and owners are committed to reducing the ecological

“footprint” of their production processes, minimize emissions (possibly have a

goal of zero-emissions some day), improve the working conditions for employees

and reconnect with nature in the area. There have been a number of examples

of eco-industrial parks in the country over the past decade but this would be a

first for the Upper Midwest and a model for the region and the country. It also

takes advantage of the major companies located in the region that are committed

to environmentally sensitive production and may be occupants in the park.

This commitment to eco-industrial development is not just a future looking economic

development strategy but a recognition that the history of industrial development

has been mixed in Cincinnati; providing wealth for the economy and jobs yet at

significant health and environmental costs. The walkable urban redevelopment

of Lower Price Hill is most effected by the eco-industrial development and the

redeveloping Lower Price Hill could be a major amenity to the park.

Enhancing The Sense of Place

The strategy will encourage “drivable sub-urban” development. Drivable sub-

urban development is low density development that involves only cars and trucks

for the vast majority of transportation needs, though industrial users also have

freight rail options. Buses, transit and walking are not overly practical due to the

low density. Drivable sub-urban places involve significant acreage, from

hundreds to thousands of acres for commercial and industrial uses. The Lower

Price Hill neighborhood, however, is the one exception regarding the ability to develop some level of a “walkable urban” place. Lower Price Hill is in the early stages of a revitalization presenting an opportunity to take advantage of its historic building

fabric and collaborate with interested residents and merchants. In this unique area of Queensgate, a “walkable urban” development would result in a much higher density than drivable sub-urban and include a variety of different uses within a compact walkable area.

New In-Fill Housing

Another QDC objective is to increase the City’s tax base while increasing the housing, retail and employment options for its citizens. It is also important that the strategy insure that the bordering neighborhoods do not feel there might be unnecessary and unwanted intrusions and that there is ample means of involvement in decision-making.

In the coming years there is likely to be a market demand for some level of in-fill housing on smaller parcels of available land versus the larger industrial tracts, especially on the east side of the Queensgate nearer existing housing in OTR. Workforce housing is anticipated to be one of the market niches. Additional housing market analysis is expected to be done once the long-term Queensgate master planning process is underway.

Establishing a Team of Subject Matter Experts (SME):

One of the first action steps to be carried out by staff would be assembling a small group of SME covering the key disciplines necessary to carry out an immediate, short and long-term action plan initiative. Some of these disciplines will include:

• Architectural Design

• Engineering

• Transportation

• Railroad

• LEED/Sustainability

• Legal

• Financial

• Industrial Real Estate

• Marketing/Communications/Interactive Technology

QDC Operating Principles:

A foundation set of operating principles for achieving success would be established early on by the QDC board of directors. The purpose behind defining a broad set of operating principles is to indicate to others how the QDC intends to do business and thus build confidence and trust with those who work with the organization. The following passage is drawn from the QI document and highlights examples of some of the approaches to be taken:

• Create a team of locally based officials representing green-manufacturing

corporations with a regional presence, including Toyota, Duke Energy, GE and

Procter & Gamble, to guide the City and the real estate development community

in evaluating market demand for green industry ventures. The key role of this

green industry opportunity team will be to leverage national expertise within their

corporations on green sustainability practices and project planning to help the

City and private sector developers align its green industrial economic

development with potential opportunities in the marketplace.

• These additional actions should be accomplished as identified and directed by

the national advisory panel and local green industry opportunity team.

Outlining the QDC Action Plan:

Working from the previously developed QI Report, the following outline of activities has been developed that would be reviewed and refined by the Board of Directors regarding a three phase implementation plan – immediate, short and long-term.

Immediate:

• Review all pertinent documents and reports related to redeveloping the Queensgate area.

o A related task will determine the priority boundaries for QDC’s initial phase of work; for example, confirming Western Hills Viaduct to the north, State Ave. to the west, I-75 to the East and the Ohio River to the south.

• Activate Board of Directors and Advisory Board members.

o A primary objective during this period is to build a foundation of trust between core stakeholders, key constituency groups and area-wide partner institutions.

• Use the QI document as a framework for setting priorities and decision making regarding any immediate issues that need attention:

o Establish a QDC decision-making style that seeks to make progress on multiple fronts as quickly as possible versus a slow-moving and linear process.

o Staff will be given responsibility to carry out Board approved policy objectives with regular reporting to the Chairman and Board Executive Committee.

• Undertake a special focus on the Cincinnati Museum Center, the property immediately surrounding it, and implementation of its Strategic Master Plan goals.

• Carry out a SWOT analysis – evaluating strengths, weaknesses, opportunities and threats and/or challenges to the area.

• Assemble a collaborative consultant team committed to achieving immediate, short and long-term results.

• Develop strategic action plan for first 12-months and review with Advisory Board; seek approval from QDC Board of Directors.

• Begin planning process that results in development of Short-Term Strategic Plan and Long-Term Strategic Plan.

• Develop necessary QDC membership and governance program that ensures continued financial stability from public and private sector stakeholders with the expectation that a combination from both is likely to be called for in the first two-year period. The long-term goal of the QDC is to avoid being either solely dependent upon the public sector for its yearly operating expenses or a small number of private/philanthropic contributors. Rather, a self-funding model such as the Downtown Cincinnati Inc. (DCI) seems appropriate in the case of Queensgate. This self-taxing model would spread the financial responsibility out between the vast number of property owners and businesses located within the expansive area of Queensgate.

Short-Term (first two years):

• Perform any necessary studies

• Collaborate with officials/consultants representing major infrastructure projects (City Master Plan Study, I-71/I-75 Ohio River Bridge and I-75 Corridor Restoration) and advocate for best design/construction/financing/redevelopment decision-making policies that impact Queensgate in the future.

• Organize strategic relationships with a wide range of key partner institutions that can positively influence the future redevelopment of Queensgate.

• Initiate a first round of project proposals to a wide range of funding bodies that have the potential to invest in Queensgate redevelopment projects.

• Complete land-use/property analysis and initiate, by QDC or on behalf of a collaborative partner, a first round of land changes designed to stimulate business development or other kinds of strategic improvements.

• Complete Queensgate Strategic Planning Report and begin Phase-1 implementation (see Draft - Table of Contents and Chapter Outline of Queensgate Strategic Planning Report at conclusion of this document.)

• Additional objectives to be determined.

Long-Term (4 – 10 years):

• Continue Phase-1 implementation of Strategic Plan and begin Phase-2 and all following phases.

• Conduct “Lessons Learned” analysis of QDC’s first two years of operations.

• Additional objectives to be determined.

Business and Operating Budget:

While an effort will be made to seek in-kind support from a range of businesses interested in supporting the QDC, a yearly budget will need to be established that ensures adequate funding in order for the QDC to accomplish its objectives. The challenges facing the QDC have been years in the making so it is anticipated that the effort to improve the area in the future will take several years to accomplish. A one-year operating budget is outlined in the following. Once that has been secured and activities are underway, an ongoing priority will be to secure funding for an additional 2-3 years in order to focus staff and board attention on the primary objectives of the QDC.

• Based upon operating budgets established for Cincinnati community development corporations, an approximate budget projection for the QDC in its first few years of operations is anticipated to be $250,000 per year for staffing, various administration/operation services, including accounting/audit, fundraising/financial and marketing/communications costs (which would include an improved wayfinding/signage plan for Queensgate in order to establish an improved sense of place). An additional $250,000 for a wide-range of consulting team services, land management and legal related costs. While there is certainly flexibility in creating QDC’s yearly budget (both in the amount as well as multiple sources), an estimated goal for each of the first three years would be $500,000 in order to ensure a level of permanence for the organization which will help it build a permanent base and constituency of supporters. This amount may decrease in subsequent years after initial action plan studies have been completed. Note: it is understood that the QDC’s financial operations could increase depending upon the level of land and other types of development transactions the organization would enter into.

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