The Report of the Riverfront Advisors...

September 30, 1999

T h e R e p o r t o f t h e R i v e r f r o n t A d v i s o r s C o m m i s s i o n

The Banks is the shining centerpiece of our region,

reflecting excitement, energy, a new sense of pride and renewed connection with our River. It is a place people call home. It is a place where people work and shop and party and visit. It is a place where people cheer the home team, celebrate freedom,

and honor our rich diversity. It is a place for playful enjoyment

and quiet reflection. It is a place for everyone, citizen and visitor alike. It is a place to come again

and again. It is an engine to drive economic growth and new vitality in Cincinnati, Northern

Kentucky, and our entire region. It is a place that links us

together, it is a new spirit of cooperation. It is an experience

that elevates our city to true world-class status. It is our potential. It is our future.

— A V i s i o n —


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The Riverfront AdvisorsCommission is pleased to pre-sent this report to the

City/County Riverfront SteeringCommittee. We thank the SteeringCommittee for their vision and leader-ship in establishing a strong, positivespirit of collaboration and support forour work.

This is a defining moment for our com-munity. You made this clear when youchartered us in February, 1999. It is aonce-in-many-lifetimes opportunity torecreate our extraordinary riverfront as amagical centerpiece for our region, a new“front door” for our city, a new hub ofactivity, a place that connects people ofall backgrounds, whether neighbors orvisitors. With that vision in mind, we havedeveloped the plan for a new urbanneighborhood, The Banks.

You have laid the foundation: theredesign of Fort Washington Way, thecommitment to two new stadiums, thevision for the Freedom Center and a greatRiverfront Park. Our charge has been tocreate a development program that buildson this foundation and maximizes itspotential to serve and enhance our com-munity, catalyze economic growth andrenew pride.

During the last nine months we havebecome energized about the potential.We have become convinced that with thecourage, leadership and commitment ofpublic officials, the excitement and sup-port of the community, and the creationof a true public-private partnership, wecan indeed seize thisunique opportunity.

And it will takecourage; it will takesupport; it will takepartnership. Our pro-gram is creative,practical, responsible.It is responsive – tothe interests of thepeople of this com-munity, the riverfrontstakeholders, and the commitments of theCity of Cincinnati and Hamilton Countyofficials. It provides the critical mass andvariety needed to make The Banks a des-tination, and it must be viewed as awhole. All the elements work together;the plan should not be picked apart.

At the heart of this program is the convic-tion that investment in public amenitiesdrives private investment, which in turnmaximizes the benefit for the community.Public-private partnership is critical to thesuccess of The Banks.

Locally, we have some important success-es based on this public-private partner-ship principle – but not to the extent of

other cities like Atlanta, Baltimore,Denver, Charlotte and Portland. NorthernKentucky knows the power of public-pri-vate partnership. Cincinnati needs toleverage this equation much more.

As the Chair of the Riverfront AdvisorsCommission, I want tothank the others whohave served, and willcontinue to serve, withme. They have broughta diversity of skills andbackgrounds: architec-ture, development, eco-nomics, marketing,entrepreneurship, pub-lic and community ser-vice. Above all, theyhave brought commit-

ment and energy to fulfilling GreaterCincinnati’s potential. We have workedwell together, and this report has the fullsupport of all of the Advisors.

In addition, I want to thank all the majorstakeholders and interested organizationswho have participated with us in creatingthe plan, including the Reds, Bengals,Firstar, Freedom Center, DowntownCincinnati, Inc., Building and OfficeManagers Association, Cincinnati BusinessCommittee, Parks Department, City ofCincinnati, and Hamilton County.

Finally, I must thank the hundreds andhundreds of concerned citizens who tookthe time to attend forums, write letters,

prepare designs, send e-mails, makephone calls, and schedule appointmentswith us. Their concern, and their beliefthat Cincinnati can be a world-class city,has inspired us.

We are convinced more than ever that thefuture of the riverfront – The Banks –must come not from bricks and mortaralone, but from a will as powerful andflowing as our River, a will to achievewhat can be, what must be. Together, weknow we can achieve it. We ask for yoursupport and implementation of this plan.

Jack Rouse, ChairRiverfront Advisors Commission

Letter from the Chair of the Riverfront Advisors Commission


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In January of 1999, the City of Cincinnatiand Hamilton County collaborated in anunprecedented way by jointly adopting a

motion to form the Riverfront AdvisorsCommission. These resolutions are providedin Appendix I, along with a listing ofRiverfront Advisors Commission members.

The Charge to the Riverfront Advisors Commission

◆

The overall goal given the Advisors was to“recommend mixed usage for the riverfrontthat guarantees public investment will createsustainable development on the site most val-ued by our community.” The specific objec-tives with which the Advisors were chargedare as follows:

Objectives

(1) Advise City/County RiverfrontSteering Committee on what combina-tion of development should be builton the riverfront.

(2) Perform feasibility studies to deter-mine proper mix of retail, hotel, residential, and office space andamount that can be supported in this market.

(3) Build community consensus amongkey stakeholders on development criteria and plan.

(4) Participate with the City in the reviewof proposals from developers.

(5) Recommend development team toCity/County Riverfront SteeringCommittee.

(6) Recommend financial plan to com-plete development and supportinginfrastructure.

(7) Recommend organization structure to ensure implementation of development.

◆Study Area

The Steering Committee defined the studyarea to be bounded by “Fourth Street to thenorth, the Ohio River to the south, I-75 BrentSpence Bridge to the west and L&N Bridge to the east. The southern edge of downtownis included to ensure that the connectionsbetween downtown and the riverfront are strengthened and retail development is complementary.”

As we pursued this charge, it quickly becameapparent that we needed to take a compre-hensive, long-term, master-planning approachto this project. Any type of piecemealapproach would be unsatisfactory. We believeour program is holistic and sustainable, anddelivers on the mission created by theSteering Committee: “to make a signaturestatement about our city to the world.”

Riverfront Park walking path looking east.

The Riverfront Advisors held regular meetings topursue the charge from the Steering Committee.


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Cleveland has The Flats.

Baltimore has Inner

Harbor. Denver has

LoDo. Cincinnati has

THE BANKS.

Logo: 1 Color Version Logo: Full Color Version

Early on, we realized the focus of ourattention, the central Cincinnati river-front, needed an identity. It needed a

name. Cleveland has The Flats, Baltimore hasthe Inner Harbor, New York has UnionSquare, Denver has LoDo, San Francisco hasFisherman’s Wharf, San Antonio hasRiverwalk. We are suggesting that our riverfront area be called The Banks.

The name needed to do three things: a) be contemporary, yet consistent with asense of heritage, particularly river heritage; b) connote action and variety, that somethingexciting is going on for everyone; and c) convey a friendly, warm, inviting, inclusive environment.

We looked at over thirty different names,working with Lexicon Branding, one of theworld’s leading naming firms, who providedservices pro bono. We quickly decided onThe Banks. It delivers on each of our objec-tives. It is simple, direct, short and easy tosay. It is authentic, not gimmicky. It has ener-gy and crispness, a sense of vitality, a senseof place. Most importantly, it connects theregion to the River, one of our key develop-ment goals. We think it works.

What Do We Call It?


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Summary of Recommendations1. The Banks should create a 24-hour,seven-day-a-week, diverse, pedestrian-friendly urban neighborhood with a mixof uses, including residential housing, special-ty retail stores, restaurants and entertainment,office and boutique hotel space.

2. The Banks should fully integrateCentral Riverfront and Third Street devel-opment to maximize economic potential,stengthen linkages with the Central BusinessDistrict and build the critical mass to create ariverfront destination.

3. The Banks development should beenhanced and better-connected to theCentral Business District by adding three infrastructure and amenityimprovements:

◆ Pedestrian plazas covering most of Fort Washington Way

◆ A major new anchor attraction – The Boardwalk at the Banks – on the west side of the development

◆ Exciting, usable green spaces and ameni-ties, particularly in the center of the development.

4. The design of The Banks neighbor-hood should foster a diverse, welcoming,pedestrian-friendly urban character andcreate a striking visual impression – a picturepostcard for our community. Architecturalguidelines including building heights, materi-als, setbacks, signage, use and design shouldbe adopted and codified.

5. The County-funded above-groundparking garages currently planned for theCentral Riverfront Area should be shiftedto sites north of Third Street to stimulateThird Street development and increase overalleconomic return. This creates the opportunityto nearly quadruple private investment stimu-lated by riverfront public investment andnearly quintuple the total annual new rev-enue from the development. To meet theCounty’s total parking commitments, this planalso requires that the Crossett site west of thePaul Brown Stadium be used for parking.

6. The City, County and private sectorshould collaborate to fund the publicinfrastructure and amenities required toattract and support private developmentincluding:

◆ Developer land lease payments◆ Tax Increment Financing (TIF) from

the City◆ Allocation of a small portion of unobligated

County sales tax revenues◆ Subordinate bonds purchased by private

lending institutions.

7. The City, County and private sector(through DCI) should jointly create aninterim parking and shuttle program toaddress the near-term shortfall in downtownparking spaces created by moving above-ground parking north of Third Street.

8. The Banks development should stimu-late economic inclusion among all ages,races and genders in all aspects, includingdesign, construction, execution and opera-tion. The Banks Entrepreneurial Equity Fundshould be established to advance this goal.

9. The Central Riverfront Area should bedeveloped in phases to reflect marketdemand and stadium, Freedom Center andRiverfront Park development timetables, withPhase I completed in 2003 and Phase II com-pleted in 2006.

10. The City and County should jointlycreate a Riverfront DevelopmentCommission (RDC) to oversee developmentand ensure implementation of The Banks’vision.


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“Whatever you do, make it fun!”

— Public Forum, March 23, 1999

“Whatever you do, make it fun!”

— Public Forum, March 23, 1999

Aerial perspective of The Banks.


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“We should focus onour history

and the Ohio River.” — Public Forum

“We should focus onour history

and the Ohio River.” — Public Forum

The Banks site plan.

◆◆

◆

◆


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Astory drives a development. Withouta cohesive story, any project is des-tined to become a collection of indi-

vidual pieces, rather than an integratedwhole. A story becomes the basis for judgingthe appropriateness of all the elements – thelook, the feel, the uses, the purpose.

Our story grew out of input from many dif-ferent sources, was influenced by researchand shaped by lessons learned from similardevelopments around the world. It is not aprescriptive list of developer recommenda-tions; rather, it is the heart and soul of thedevelopment. It is why it exists, what it canbecome. It describes the experience. Thestory is about emotions, pride, the past andthe future.

Why We Must Care

The River is our uniqueness. Look around.Cruise east alongRoute 50 at dawnand see the sunilluminate thewake of a slow-drifting barge.Wing in toCincinnati on aweary red-eyeflight and feel thethrill of home-coming when you sight the River from threemiles up. Hail the Anderson Ferry and feelthe might of our river hurrying west andsouth from Pittsburgh. This is the banks ofthe Ohio River. It is our distinctiveness. Thatis why we must care.

The Story of The BanksThe River is our past. A place to whichpeople came – wandering tribes, pilgrimsfleeing tyranny, slaves seeking freedom, mer-chants in search of fortune. The Riverbrought them, nurtured them, held themhere. We want to honor this. That is why wemust care.

The River is our future – a place that willdraw new generations. A place that will spurnew growth. A place that creates new con-nections, new traditions, new destinations. Itis our opportunity. That is why we must care.

That is why we must create The Banks.

The Creation of A Place

The Banks is our front door. It is the pic-ture postcard of the region. It includes every-one. It is alive. It can change and transform,renewing itself for generations yet unborn.

The Banks is a placewhere people meet andcongregate, where theyenjoy a multiplicity of activi-ties and each other, wherethey share stories of pastexperiences and dream newdreams. It is a place thattakes pride in the past andthat generates excitementabout the future.

The Banks is a place where kids are mesmer-ized by the flowing river, where they iceskate with their parents in the winter and sailtiny boats on a miniature Ohio River in the

summer. It is a place where people work,and relax after work. It is a place where peo-ple celebrate their rich cultural diversity –African-Americans, Hispanics, Asians and oth-ers, alike.

It is a place where convention visitors canfind food and entertainment not available inany other city. Empty nesters can look out oftheir condominium window as the OhioRiver flows by and remember together a richlife that began when they first met on thedeck of the Island Queen.

It is a place of connections – between thehills and valleys of Kentucky to the southand Indiana and Ohio to the north, east andwest. It is a place connecting river banks,north and south. It is a place for commerce,recreation, entertainment, and contempla-tion. It is a place for families.

What Kind of Place?

The Banks is “home” – a place where weall are welcome and where we all celebrate –because it is ours. It is a mixture of activeand quiet recreational opportunities, tributesto our pride and our history, food and mer-chandise reflective of our diversity and with adistinctive local flavor. It is unique residentialspaces, and regularly-programmed celebra-tions and special events.

The Banks is a sustainable development,constructed more of spirit than of bricks andmortar. It is not a tribute to any one activityor any single interest, but rather what italways was: a place where people meet and congregate.

The Banks has been conceived by peoplein the region. It will be developed by peo-ple of the region, and operated by entrepre-neurs of the region. It will be fun, and it willbe a one-of-a-kind experience. And it canonly be found here.

What Does It Mean to Us?

The Banks brings our aspirations intoclear focus and provides a strong physicalidentity for the millions who live in the sur-

rounding vil-lages and town-ships. TheSuspensionBridge is a sym-bolic representa-tion of TheBanks. It reflectsconnections. Itis a physical linkbetween two

banks, of course, but it is more than that; italso is a metaphorical bridge between a richpast and an exciting future.

And, at the end of each day, as the sun setsand as citizens drive down the highwaystoward the city, or gaze out of the window ofan approaching jet as it glides into our air-port, the sight of The Banks creates a senseof joy and pride that will serve as a continualreminder that this is more than just anothercity. This is Cincinnati.


The Situation as We Began

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When the Riverfront Advisors wereformed, much good work hadalready been completed on the

Rebirth of the Riverfront.

◆ Paul Brown Stadium and the Red’s Ball-park had been sited

◆ The Freedom Center had been sited◆ Fort Washington Way improvements were

underway◆ Parking considerations had been studied◆ Basic urban design guidelines had been

created

Cincinnati Urban Design Guidelines • Re-establish the city grid to the River• Transform existing isolated parks into

a Riverfront park system• Remove Fort Washington Way as a

barrier to the Riverfront• Create centrally-located multipurpose

parking• Preserve sites for viable economic

development• Link attractions in the region• Develop public transportation links

within the region• Preserve the views and connections

from the river to downtown and downtown to the River

As we started our work, we heard from theSteering Committee, Urban Design Associateswho developed the design guidelines, andvirtually everyone else involved, that this was the most complex urban design projectcurrently under development in the U.S. Any redevelopment program of this scope is complex.

What makes our riverfront development mostchallenging is the need to keep it vital and atthe same time construct two new stadiumsand the Freedom Center, relocate miles ofutility lines, create new streets and build thewhole project on a major floodplain – just to name a few of the complications. This ismore than most cities can undertake, but weare up for it.

Original site plan given to Advisors,February 1999.


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Three things were clear from this research:

◆ The people of the region are behindthis development. They have high hopesand high expectations that community lead-ers will create something great. They recog-nize the opportunity. They want to recon-nect with the River. They want a diverseand inclusive community. They want some-place fun and exciting to go, and comeback to.

◆ Public investment inamenities and infrastruc-ture drives private invest-ment, thereby maximiz-ing the total value for thecommunity. A strong pub-lic-private partnership isessential to sustained, long-term success. This was truein all of the successful citieswe studied.

◆ The development must have the criticalmass and variety to attract repeat visi-tors, as well as permanent residents, toremain vital. Residential housing is key toensure there are people in the neighbor-hood all the time. Strong anchor attractionsand diverse, varied programming also are

critical. Theydraw people fora first visit, anddraw themback. A devel-opment is notsustainablewithout thisrepeat visitation.

The Riverfront Advisors’ Approach

◆

Over the past nine months, we havefocused primarily on five of theseven elements of our charge from

the Steering Committee: assessing the types ofdevelopment which should be considered,performing feasibility studies, building con-sensus, creating a viable financial plan, andstudying the organization structure requiredto ensure implementation of development.

We approached this work in three phases:

Research Phase: We reviewed Riverfront plans from the past(see Appendix II), conducted public forumsthroughout the Greater Cincinnati Area, metwith major stakeholders and experienceddevelopers, researched and visited successfulurban developments including Atlanta,Baltimore, Charlotte, Denver and Portland,and consulted with development and eco-nomic experts. References on experiences inother cities are provided in Appendix III.

We also looked in our own backyard. Whathas stimulated the rapid, successful develop-ment in Northern Kentucky? Why hasn’tCincinnati kept pace? Why is it that regionalplanning expert Dr. Michael Gallis remarked,“Cincinnati has remnants of a once-greatcity?” How can The Banks help re-stimulatethat greatness?

We studied market data todetermine local demand forvarious types of developmentand chartered a study byEconomics Research Associates,an independent consultant, tofurther assess market needs andpossible financing mechanisms.

“Communities are moving back

into cities by design, not

by default.”

– Paul Morris, a Portland landscapearchitect spearheading a Portland

urban development effort.“Portland Caps,” Urban Land,

July, 1999Denver

Baltimore

Portland

Covington


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◆ Development Principles

Coming out of the research phase, wedefined five fundamental developmentprinciples which guidedthe rest of our work:

◆ Inclusion and diversity.The development must beinclusive and inviting toresidents and visitors alikeand reflect the diverse eth-nic, cultural and demo-graphic mix and interestsof all citizens of the region.

◆ Attractive, friendly andfun. The developmentmust be vibrant and safe24-hours-a-day, seven-days-a-week, year-round, be pedestrian-friendly, easily accessible, and foster a fun,exciting atmosphere.

◆ Connections and synergy. The develop-ment should reconnect the city to the Riverand establish it as a focal point for theentire region. It should encourage connec-tions within the riverfront area as well aswith the Central Business District andCincinnati attractions, Northern Kentuckyand the surrounding region.

◆ Long-term, market-based approach. Thedevelopment must take a long-term, mar-ket-based approach to planning, develop-ment, design and public improvements to

ensure it is sustainable,will attract quality devel-opers, and will continueto serve generations tocome.

◆ Catalyst for economicdevelopment. Thedevelopment should helpstimulate economicdevelopment of the city,county and region andencourage creative pub-lic-private partnerships,thereby maximizing thebenefits of the more than

$1 billion of public investment in the river-front. It should complement, not competewith, the Central Business District (CBD)and other developments. Economic inclu-sion of all races, genders and ages is key tosuccessful economic development.

“I’d sure move downtown –

don’t have to cut the grass

any more and the parks

would be nicer anyway.”

– Retiree, Public Forum, June 5, 1999

“Why does Kentucky

get everything?”

– e-mail from Cincinnati citizen

“We all need to feel welcome

downtown.”

– African-American Chamber ofCommerce Forum, April 10, 1999


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We conducted design charrettes involvingCity and County planners, key riverfrontstakeholders, the Steering Committee’s designconsultant, Urban Design Associates, andmany of the Advisors to examine designoptions and look at how to best integrate andconnect the various parts of the development.We began to get a feel of the place.

◆ Predestrian-Friendly.We determined we should not tightly packthis development. We would have moderatedensity of development, with lots of greenspace and open areas. We would carefullyscale the development to be pedestrian-friendly, and complement the skyline as wellas the attractions within the development. Atthis point, we developed our overall conceptsfor uses and design.

◆Design Phase:This phase of our work focused on creatingand assessing development options. Ourresearch clearly determined we should plan a mixed-use development including residen-tial, retail, office and hotel space, but in what mix?

◆ Connections, Access, Attractions.We also knew we needed to strengthen connections to the CBD so that the riverfrontdid not become an island, or worse yet acompeting development. Better pedestrianaccess between the riverfront and CBDwould be essential. We also had to ensurestrong draws to create movement and vitalitywithin the development. Given the Bengalsstadium would likely be used just 10 timesper year, we particularly needed to strengthenanchor attractions at the west end of the development.

◆ Greenspace, Sense of Place.We understood the vital contribution of greenspace to attracting residents, visitors anddevelopers, so we looked for ways to furtherintegrate planned riverfront park space. Wealso saw a need to expand green space with-in the core of the development.

Our researchdetermined weshould plan amixed-use devel-opment includ-ing residential,retail, hotel andoffice space.


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◆ Responsible, Long-Term FocusWe recognized that some of our recommen-dations may be considered out-of-the-box,and even involve a slightly greater public-pri-vate risk than elected leaders in our commu-nity have historically been willing to accept.These recommendations also require thecooperation of the major stakeholders on the riverfront. Yet, the approaches we are recommending have worked in other cities.They are responsible. The economic assump-tions are generally conservative. The solutionsare focused on the long-term viability of our community and the greater good of the region.

◆ Shaping a New FutureThe benefits of a successful Rebirth of theRiverfront are huge. The various public andprivate entities involved in this developmentmust pool their resources and work togetherto accomplish the goals of the communityand the region.

We recognized the stadiums, the FreedomCenter, the parks, the parking, the com-mercial development by themselves willnot revitalize our region’s urban core.Together, though, they form the criticalmass required to reverse past trends andshape a new future.

We can only capture this potential if we canestablish uncommon cooperation and a will-ingness to stretch outside our communitycomfort zone. If we fail to capitalize on thecatalytic effects of this development, the eco-nomic future of the region will be seriouslycompromised.

The product of this third phase of our workis the recommendations and analysis found inthis report. The recommendations fall in tenkey areas. We have provided detailed supportfor each recommendation, but in general theten must be taken as a whole. They each aredesigned to build on the next to create anexciting, viable riverfront development, andrespond to the Steering Committee’s chal-lenge to “make a signature statement aboutour city to the world.”

“A combination of vision, suc-

cessful models, private and

public investments, and politi-

cal leadership can reconnect

a community to a priceless

asset – its river.”

– Tom Cassidy, general counsel ofAmerican Rivers, Washington, D.C.,

“Reclaiming Waterfronts,” Urban Land,July 1999

◆Economic Analysis andRecommendation Phase: This is the third portion of our work. TheSteering Committee charged us with definingan economic plan to support developmentwithin the Central Riverfront Area along withfunding for the street grid within it. We knewthat if we did not do the economic and fund-ing analysis extremely well, our design rec-ommendations would never survive.

◆ Public-Private RelationshipsAt the core of our approach was the beliefthat sustainable economic developmentcomes from active, creative public-privatepartnerships. This has been true in every successful urban development we studied.Neither public nor private investment alone is sufficient or feasible.

We looked at how public investment in infrastructure, such as parking, could be used to stimulate or accelerate private invest-ment, thus delivering a greater return on taxpayer dollars. We looked at potential forTax Increment Financing (TIF), which usesthe incremental tax revenues produced bynew development to finance public improve-ments that enhance the feasibility of the newproject. We explored other creative financingapproaches. Cities like Atlanta, Baltimore,Charlotte, Denver and Portland have proventhat world-class public amenities will driveprivate investment initiatives. We can do it, too.

Current Cincinnati Riverfront and skyline.


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1. The Banks development shouldcreate a 24-hour, seven-day-a-weekdiverse, pedestrian-friendly urbanneighborhood with a mix of uses.

This should include residential housing, spe-cialty retail stores, restaurants and entertain-ment, office and boutique hotel space. Webelieve these uses, combined with the majoranchor attractions, Riverfront Park, strongpedestrian and transportation linkages, andover 10,000 parking spaces in the developmentarea, will create the attractive, friendly, fun,

Recommendations

“Planners agree that for downtowns to thrive,

the new buildings and sidewalks need

new downtown residents.”

– Melissa Turner, “Downtown Transformed,” Atlanta Journal-Constitution,August 15, 1999

Retail & Residential Entertainment Office Hotel

(Units) (000’s sf) (000’s sf) (Rooms)Central Riverfront 600-800 250-300 100-200 200-400Third Street 300-500 150-250 1000-2000 —Total 900-1300 400-550 1100-2200 200-400

exciting, diverse, economically sustainabledevelopment we set out to design as an impor-tant catalyst for future growth and vitality.

Development of the Riverfront area must bemarket-driven. A mix of uses is critical toachieve a successful, long-term development.The advisors have created a recommendedrange for development of each use; the ulti-mate mix will be determined by marketdemand and developer creativity.

Each element plays an integral role in creatingthis whole. The vision, role and rationale foreach element are as follows:

Recommended Range of Uses

◆Residential HousingHousing is the most important element of TheBanks development. It is essential to creatinga diverse neighborhood that is alive 24-hours-a-day, seven-days-a-week, year-round.Buildings, parks, and stadiums don’t createvitality; people do. Downtown Cincinnati, Inc.studies indicate demand for 1,400-4,000downtown housing units over the next 10years. Further, analyses by Dr. Norman Miller,Director of the Real Estate Program at theUniversity of Cincinnati and a RiverfrontAdvisor, indicate more potential demandexists for downtown housing units than willlikely be supplied by all the pending or pro-posed downtown Cincinnati developments.

Housing development should include:

◆ For-sale and rental properties targeted toempty nesters aged 50-70

◆ Rental units for young working adults, singleand married, in all income ranges, includingsome units that are affordable for lower-income households.

We envision about three-fourths of the resi-dential units in the Central Riverfront Areaand one-fourth in the Third Street area.Details of several prospective housing mixesand resulting economics are provided inAppendix V, Exhibit A.

Pedestrian-friendly streetscape nearPaul Brown Stadium.


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Freedom Way looking west.


◆RetailStreet-level retail shops, restaurants and enter-tainment should support the residential, officeand anchor attraction activity at The Banks.Economic analysis suggests sufficient demandwill be created to support new retail develop-ment. We don’t envision “big box” retail aspart of The Banks; this should be retainedand encouraged north of Third Street. Weencourage emphasis on local entrepreneursand developments with a unique local andregional flavor.

◆ Shops would include service retail to sup-port residents and workers (e.g., dry clean-ers, video rental, convenience stores, etc.),recreational retail to support biking andother activities in the area, and boutique,specialty retail with unique local interest.

The specialty retail should celebrateCincinnati’s unique ethnic and cultural her-itage and diversity. This could include avariety of shops offering goods such asAfrican arts and crafts, Afro-centric dress,Cincinnati sports memorabilia, a gallery fea-turing local artists and many others of localcharacter. Retail also could include portablecarts and small kiosks to enhance diversityand vitality, which is not always possiblewith enclosed retail.

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Freedom Way, near Paul Brown Stadium includes four-story residentialover street-level retail at right; six-story office over street-level in center.


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development be located in the Third Streetdevelopment area, complementary to theCBD.

Analysis by Economic Research Associates(ERA) indicates the CBD has seen strongoffice absorption over the last three years andsteady improvement in rental rate growth.Nonetheless, office rents still need to increase$2-3 per square feet to justify new construc-tion. Currently, it is not economically feasibleto build new office space in the CBD withouteconomic incentives such as Tax IncrementFinancing and/or parking subsidies.

Further, the CBD has not attracted its share ofnew office construction due to perceivedproblems such as lack of convenient, afford-able parking. The Adivsors’ plan will helpaddress all of these issues.

Since 1990, approximately 600,000 square feetof speculative office space was constructedand absorbed in Covington, Kentucky. This isa strong indication that the availability of mar-ket office developments does stimulate corpo-rate relocation and tenant retention in theurban core (e.g., Ashland, Inc.). According toERA, this is a level of performance that wouldnot have been predicted based on trend dataand proves that past trends are not alwaysindicative of future performance.

The public infrastructure and amenity invest-ments in The Banks will be key to increasingCBD occupancies, values and rents. Further,by creating a quality environment in TheBanks area, downtown will become morecompetitive with the suburbs.

The public

infrastructure and

amenity investments

in The Banks will be

key to increasing

CBD occupancies,

values and rents. ◆

◆ Restaurants and Retail Entertainment–We envision unique dining and entertain-ment venues rooted in the region’s historyand culture at a variety of price points. Whileultimately developers will be responsiblefor determining the right retail mix, we donot believe The Banks should be focusedon national chains or theme establishments.

Food and entertainment retail mightinclude a soul food restaurant such as thepopular Harlem restaurant Sylvia’s, a clubcelebrating the region’s Appalachian/blue-grass music traditions, a Porkopolis-themedrestaurant and venues featuring various eth-nic offerings such as Jewish, Italian orAsian cuisine. There also may be opportu-nity for one or more themed or targetedclubs, such as a jazz club or a venue suchas BET Soundstage.

The Hofbrauhaus of Munich has alreadyexpressed interest in a location near thePaul Brown Stadium, although there is nofinal agreement. This German food andentertainment experience is consistent withour desire for connection to Cincinnati’sheritage and would provide a strong foodanchor at the west end of the development.

OfficeWe recommend boutique-sized office devel-opments within a mixed-use project in theCentral Riverfront Area. This space would betargeted largely to independent professionalsseeking a unique office environment, particu-larly for those who may also reside in thedevelopment. This uniquely targeted officespace will minimize competition with theCBD. We recommend major corporate office

◆HotelWe believe one or two modestly-sized bou-tique hotels, built in the later developmentphase, could be supported from visitors tospecial events and anchor attractions in TheBanks. In addition, the unique views andaccess on the riverfront could create specialappeal, based on the success of NorthernKentucky riverfront hotels.

We do not believe these hotels will generatemajor business from convention visitors,although the potential Convention Centerexpansion would strengthen overall hotelroom demand in the downtown area.Convention Center expansion also would con-tribute to the overall vitality of The Banks.New restaurant and entertainment center

adjacent to Paul Brown Stadium.

New Third Street office development overlookingnew Fort Washington way pedestrian plazas.


17

View from Paul Brown Stadium looking east.


18

◆ The Reds Ballpark - Thismajor east side anchor willgenerate a substantial influxof visitors during more than80 game days per year. TheReds complex will includeyear-round retail, dining andentertainment venues includ-ing a Reds museum.

◆ The Freedom Center - Thisanchor appeals to both resi-dents and visitors with the potential forbroad international appeal and recognition.Located in the center of The Banks devel-opment, it provides one of the most impor-tant visual focal points, as well as the majordraw to the center of the development. Theplanned open, highly-transparent architec-tural approach for the Center and parkspace in front of it will add to the pedestri-an-friendly feel of the development.

It is imperative that the Freedom Centerand Riverfront Park landscape architectsto work closely together to ensure seamless integration of these adjoininggreen spaces.

◆ Paul Brown Stadium -This major west side anchorwill generate the largest influxof visitors to The Banks on 10 football game days perseason. The Bengals stadiumcomplex also will offer year-round retail and diningvenues.

◆Synergy with Anchor Attractions While residential housing, along with

office and street-level retail, provide thebackbone of the 24-hour city in the CentralRiverfront Area, the anchor attractions are crit-ical to drawing residents from the region andvisitors from the region and beyond and gen-erating essential repeat visits. Each play aunique role in generating vitality and econom-ic stimulation:

◆ Firstar Center - This anchor attraction onthe east side of the development offers themost varied programming, most event days(130-140 per year) and broadest audienceappeal. As a result, Firstar has the greatest

potential to draw a diverseaudience to the retail andother attractions withinThe Banks, and to gener-ate repeat visits. Activitiesrange from concerts andother short-run specialevents to providing theregular home for the

Cyclones professional hockey team and theCincinnati Stuff professional basketball team.

Special attention must be paid to ensureconvenient access to Firstar, and that it isintegrated with the Reds development and The Banks.

National UndergroundRailroad Freedom CenterFirstar Center

Reds Ballpark

Paul Brown Stadium


19

Beyond these benefits, the Park is essential toattracting developers. Developers will look forstrong assurance that the planned green spacewill become reality before they will committhe major investment funds required for theproject. The value added to rents by thegreen space is essential to its success, particu-larly for the residential and retail uses.

The Advisors urge that a sound financialplan for the Park be formulated quicklyto provide the required assurances topotential developers.

◆Synergy with Green Space The Riverfront Park has been designed by

the Cincinnati Park Board, the CincinnatiRecreation Commission and the Departmentof Public Works in conjunction with a consul-tant team to provide a magnificent greenspace and special event area forming themajor anchor attraction on the south side ofThe Banks. This park space is vital to the suc-cess of the development, and provides aunique opportunity to celebrate Cincinnati’shistory and cultures.

The Park provides residents, workers and visi-tors a place for fun and recreation. The Parkplan includes trails for jogging, walking andbiking, space for personal reflection andrelaxation, a unique carousel feature, and dra-matic water features that will connect the areato the River.

Particular attention should be given toensuring that recreation trails link withother park space, particularly to the east.

A major feature of the Park is a unique andmuch-needed special event space for celebra-tions ranging from Taste of Cincinnati, UjimaCinci-bration, OktoberFest and the MidwestRegional Black Family Reunion, toSummerFair and the Cincinnati Flower Show.These events currently are disbursed aroundthe urban area and beyond. The creation ofthis special event space will provide betterinfrastructure for the programs, substantiallyreduce disruption caused by events now heldin the CBD, and provide important economicstimulation for The Banks. These specialevents also are critical to driving varied, inclu-sive repeat visits.

Site plan for Central Riverfront developmentand green space.

Riverfront Park looking east.

Special event area in Riverfront Park, looking west.


20

◆Synergy with ParkingParking is one of the most complex and

important issues related to The Banksdevelopment. It also is a major issue in attract-ing new and retaining current office tenantsand attracting shoppers to downtown.

A major goal of the riverfront development isto substantially address these long-standingparking issues. The County has committed toconstruct about 8,300 parking spaces, includ-ing approximately 4,600 spaces in a two-storyunderground garage that will provide the plat-form for the Central Riverfront Area betweenthe new stadiums.

The advisors estimate about 8,700 spaces arerequired to fulfill contractual obligations to theBengals, Reds and provide dedicated spacesrequired for the Central Riverfront plan.

The Advisors’ plan has identified a total ofabout 10,340 potential spaces and fundingmechanisms to support them. Implementationof the Advisors’ plan could also lead to thecreation of an additional 2,500 project-specificparking spaces on Third Street. We believethis program will add significant economicvalue and make a major contribution towardachieving the development goals.

A major goal of the

riverfront development is

to substantially

address the long-standing

parking issues.

Underground ParkingAbove Grade ParkingSurface Parking

(000) Indicates Dedicated Spaces

Advisors’ Recommended Riverfront Parking Master Plan*

Original Riverfront Parking Master Plan

*The Advisors’ final plan differs slightly from the plan identified above. It provides for 103 additional new parking spaces andresults in a slight change in the number and location of underground public and above-ground dedicated spaces.

The Advisors’ Plan:1. Increases # of

public spaces by780.

2. Increases # of totalnew spaces by2,991.

3. Eliminates unsight-ly six and eightstory above-ground garagesoriginally plannedfor blocks 2 & 4.

4. Improves viewlines to new RedsBallpark &Freedom Center.

5. Expands develop-ment potential inCentral Riverfrontby 292,000 square feet.

6. Significantlyenhances potentialfor 3rd Streetdevelopment.

Six-StoryAbove-Grade

Garage

Eight-StoryAbove-Grade

Garage

All Above-Ground Public Parking MovedNorth of Third Street


21

Likewise, there could be great potential in cre-ating a Winter Garden to provide year-roundgreen space. This might be an enclosed parkfeaturing plants, water features and possiblywildlife. This could be combined with displayand exhibit opportunities for many localattractions ranging from the Newport Aquariumand Cincinnati Zoo to the Cincinnati ArtMuseum and Children’s Museum.

Our visualization also includes a landmarkoffice tower to be built on the site of theThird Street portion of the Provident Bankblock. No plans have been announced for thisproject, but the advisors believe that this loca-tion has the potential to provide a capstoneproject for The Banks.

Many other exciting ideas arose during thepublic forums, individual discussions andmeetings with stakeholders. Nonetheless, werecognized the need to make choices andestablish priorities so we have not includedthese ideas in our recommendations for theinitial development program.

◆Synergy withTransportation LinkagesAccessibility to and transportation links

with the CBD, suburbs, NorthernKentucky and the outly-ing regions, are essentialto the success of thedevelopment. These linksalso will fully leverageThe Banks as a stimulusto activity in the sur-rounding areas. Thisrequires a holistic analy-sis of parking, pedestrianand vehicular traffic flow, and public trans-portation options. Options should includebus, light rail, rubber tire trams, trolleys,pedestrian bridges, water taxis and otherdiverse, creative alternatives. The desiredresult is easy, safe, affordable, convenientaccess to various destinations.

The Banks should serve as a central disburse-ment point to other attractions in the region,and leverage the location of the new inter-modal transportation center underneath thecurrent Second Street. This benefits residentsof the region, and it benefits tourists who arelooking for easy access to the region’s manydiverse attractions.

Linkage to the CBD is important to leveragethe investment in parking in The Banks. It isparticularly important for those who work inthe CBD and park in The Banks area, as wellas for those who attend events at The Banks,but choose to park in the CBD. Pedestrianaccess with the CBD must be convenient,comfortable in a variety of weather condi-

Transportation linkages to the

CBD are important to leverage

the investment in parking

in The Banks.

◆

tions, safe and affordable. The Advisors aresponsoring a study which will be completedin November 1999. It will examine issues andoptions related to pedestrian access to andfrom the Central Riverfront Area and CBD,

including use of a coveredskywalk on the east sideof the development.

Access and transportationwithin The Banks must bepedestrian-friendly, andencourage flow across thearea. Open spaces, parkareas and wide setbacks

will enhance pedestrian friendliness. Theyalso should encourage routes that exposeguests to a variety of businesses and amenitieswithin the development area.

Longer-term OpportunitiesBy no means do these recommendations

cover all the possible uses and develop-ments that could go on the Riverfront. Forexample, over a period of time, we believethere is great promise in a first-class marinawest of the Paul Brown Stadium.This responds to the frequent callsfrom citizens for a harbor areaoffering an exciting, multi-faceteddestination. The Advisors believethere are higher near-term develop-ment needs, but a harbor shouldbe considered longer-term and isincluded in our visualization of thewest end of The Banks.

Intermodal transportation center at SecondStreet looking east next to Freedom Center.

Possible future marinaand residential develop-ment just west of PaulBrown Stadium.


22

Recommendations, continued...

2. The Banks should fully integrateCentral Riverfront and Third Streetdevelopment to maximize economicpotential, strengthen linkages withthe Central Business District, andbuild the critical mass to create ariverfront destination.

The City/County Riverfront SteeringCommittee charged the Advisors with devel-oping a plan that extends north to FourthStreet. The Advisors’ goal has been to ensurethe development in the Central RiverfrontArea and the blocks between Third andFourth Streets to the north are thoroughly syn-ergistic, and also enhance overall CBD vitality.

By integrating these developments, we increasethe critical mass of attractions to repeatedlydraw people into the neighborhood. Further,integrating Central Riverfront and Third Streetdevelopment significantly increases total eco-nomic impact. For example, annual new rev-enue to the City and County increases nearlyfive-fold when the Central Riverfront and ThirdStreet developments are taken together, asdetailed in Recommendation 5 below.

All of the Advisors’ recommendations supportthis integration. Two recommendations areparticularly important, however: ◆ the addition of pedestrian plazas over Fort

Washington Way to provide strong linkagebetween the Central Riverfront and ThirdStreet, as well as the rest of the CBD as out-lined in Recommendation 2;

◆ shifting planned above-ground parking fromthe Central Riverfront to Third Street, as out-lined in Recommendation 5 below.

Third Street office development overlooks Fort Washington Way pedestrian plazas.

Fort Washington Way pedestrian plazas provide linkage between Third Street and Central Riverfront parking, retailand entertainment.


3. The Banks development shouldbe enhanced and better connectedto the Central Business District byadding pedestrian plazas coveringmost of Fort Washington Way, bycreating a major new anchor attrac-tion – The Boardwalk at theBanks – and by adding excitingand usable green space in the cen-ter of the development.

This will require additional funding totaling $52 million, orless than a 4% increase in totalproject investment. The Advisors’recommendations include afunding plan for these enhance-ments.

This investment will provideattractively landscaped pedestri-an plazas fully covering FortWashington Way betweenWalnut and Race Streets and par-tially covering the blocks east ofWalnut and west of Race. Theseplazas will encourage easy andsafe pedestrian access to the CBD, better con-nect destinations within the riverfront devel-opment, extend appealing green space, andprovide an additional amenity to attract pri-vate investment. By enhancing connectionwith the CBD, these new plazas are particu-larly important to the attractiveness of parkingat The Banks. The cost of these pedestrianplazas is about $39 million.

The Boardwalk at The Banks will create anadditional anchor attraction at the westernend of the development, adjacent to the PaulBrown Stadium. It would extend fromTheodore Berry Way, to the stadium, anddown to the River and include exciting restau-rant and entertainment venues. It particularlyresponds to one of the strongest themesheard in the public forums – the desire forattractions that connect directly to the River.This Boardwalk will provide a new, pedestri-

an-friendly destination and astrong draw to attract people tothe western side of the devel-opment. The cost of theBoardwalk infrastructure isabout $8 million.

The Advisors also recommendadditional green spaces andamenities, particularly in thecenter of the development. Thiswill include landscaped areas,promenades and art features.This will encourage pedestrianmovement within the develop-ment and enhance its overallfeel of openness and attractive-

ness to both visitors and developers. The costof these amenities is about $5 million.


This Boardwalk will provide

a new, pedestrian-friendly

destination and a strong draw to

attract people to the western

side of the development.

23

Pedestrian plaza covering Fort Washington Way.

The Boardwalk at The Banks

Greenspace amenities alongFreedom Way.


24

4. The design of The Banks neigh-borhood should foster a diverse,welcoming, vital pedestrian-friendlyurban character and create a strikingvisual impression – a picture post-card for our community.

Architectural theme and design should buildon Cincinnati’s rich heritage, yet have a vital,energetic feel. Architectural guidelines includ-ing building heights, materials, setbacks, sig-nage, use and design should be adopted andcodified. A summary of these design guide-lines is provided in Appendix IV.

The aesthetics of The Banks must reinforcethat it is a place where all different types ofpeople feel comfortable and welcome. It must be a visually-interesting space that is ofan intimate scale and incorporates a variety of green spaces and water features. It hasbeen demonstrated in great European cities,and revitalized American cities and themeparks that these elements are two of the mostattractive and powerful features in generatingrepeat visitation.

◆ Design.The design of the neighborhood shouldinclude a diverse, urban architectural charac-ter, strategically-located setbacks and openspaces to promote pedestrian activity, andpurposeful massing and scale.

The development must be carefully plannedas it steps up from the River, through the

parks, to lower-scale buildings in the CentralRiverfront Area, and culminates with the tow-ering background buildings of the CentralBusiness District.

There should be a clearly-recognized hierar-chy to the spaces and buildings. The stadiumsand Firstar frame the development. TheSuspension Bridge and Freedom Centershould have the highest degree of promi-nence, while other aspects such as residentialand retail buildings should form a rich adjoin-ing texture. The design and scaling shouldmaximize the views and connections from theriver to downtown and downtown to the river.

◆ Separation of Uses.Given the importance of housing, the guide-lines will foster a neighborhood charactercomplementing the retail, sports and enter-tainment uses in the area. They will providefor separations between the uses throughgreen space and other approaches.

◆ People Features.Physical features will be included to ensurethat people feel welcome and comfortable.Benches, walls for sitting, fountains, outdoorcafes, sculpture, places for street performers,shade trees, interesting and varied shop win-dows, will all add to the welcoming nature ofthe development.

To be effective, these guidelines must bereflected in the Request for Proposals,and must be incorporated into the City of Cincinnati Zoning Code as appropriate.Principles and an approach for addressing this are discussed inRecommendation 10.


Architectural theme

and design should

build on Cincinnati’s

rich heritage, yet

have a vital,

energetic feel.


25


5. The County-funded above-ground parking garages currentlyplanned for the Central RiverfrontArea should be shifted to sites northof Third Street to stimulate ThirdStreet development and increaseoverall economic return.

When moved to Third Street, the parking canbe incorporated into private office and mixed-use developments. This requires reallocatingabout $17 million in capital spending from theCentral Riverfront Area to the Third Streetdevelopment, creating potential for much

greater economic impact for the same dollarsinvested. The impact of this relocation wouldbe cost- and revenue-neutral to the County,Reds, Bengals and Firstar.

When combined with economic incentivessuch as Tax Increment Financing (TIF), publicinvestment in parking north of Third can stim-ulate or accelerate the private development ofseveral major projects currently under consid-eration including those at Queen City Square,Third & Race, and the former McAlpin’s site.

This recommendation creates the opportunityto nearly quadruple the private investment

Summary — Economic Development Impact of Advisors’ Plan

Original Program Advisors’ Recommended Program

Public Street Grid $ 46 Street Grid $ 46 Expenditure in Utilities $ 15 Utilities 15 Central Riverfront Parking $ 135 Parking 135 Area (000’s) Total $ 196 Subtotal $196

FWW Covers/Green Spaces $ 39 Boardwalk at the Banks 8 Public Green Space 5 Subtotal $ 52

Shift parking to Third Street $ 0

Total $ 248

Total PublicInvestment (000’s) $ 196 $ 248

Private Investment(000’s) $ 159 $ 600

Return on PublicInvestment (ROPI) 81% 242%

stimulated by the public investment associatedwith those parking garages and the additionalenhancements covered in Recommendation 2.

As shown below, the original programrequires a $196 million public investment tofund street grids within the Central RiverfrontArea ($46 million), utilities ($14.5 million) andparking garages ($135.5 million). TheAdvisors’ plan requires an additional $52 mil-lion, as detailed in Recommendation 2, bring-ing the total infrastructure and amenity invest-ment associated with this part of the plan to$248 million. (The total riverfront investmentis about $1.3 billion.)

Riverfront Advisors CommissionPublic Investment in Riverfront

Development Area (Millions)Costs per Original Plan

Street Grid $46Utilities 15Parking 135Riverfront Park 65FWW Reconfiguration 282Reds Stadium 235Bengals Stadium 403Freedom Center 90Subtotal $1,271

Additional Costs per Advisors’ PlanCovering & Plantings over FWW $39Boardwalk Construction 8Public Green Spaces 5Subtotal $52

Total Public Investment in Riverfront $1,323

AdditionalCosts per

Advisors’ Plan

FreedomCenter7%

Street Grid& Utilities

5%

Parking10%

RiverfrontPark5%

FWWReconfiguration

21%

Reds &Bengals Stadiums

48%

4%

0

200

400

600

800

1000

Mil

lion

s

OriginalProgram

AdvisorsRecommended

$159M

81% ROPI

242% ROPI

$600M

4XPrivate

Investment

$52M$196M$196M

Economic Development Impact


26

The original plan would be expected to gen-erate about $159 million in private investmentin the development. With the Advisors’ plan,we anticipate private investment of up to $600million can be stimulated, as detailed inAppendix V, Schedule 9. This higher level ofinvestment derives principally from greaterprivate investment in the Third Street develop-ment stimulated by the public investment inparking and Tax Increment Financing, and thehigher value development in the CentralRiverfront Area previously occupied byabove-ground parking structures.

Not only is the private investment potentialnearly quadruple the original plan, but thepercentage return on public investment isnearly three times the return generated bythe original plan (242% versus 81%, respec-tively). Details of economic analyses support-ing the recommendations and financing planare provided in Appendix V and Appendix VI.

Beyond the greater level of private investment,the recommended plan generates substantiallygreater total economic impact. Primarily bymoving above-ground parking and stimulatingThird Street development, total annual newrevenue generated from Cincinnati payroll taxand Hamilton County sales tax goes from$649,000 with the original plan (CentralRiverfront only) to $3.2 million with theAdvisors’ plan (Central Riverfront plus ThirdStreet). This is nearly a five-fold increase ver-sus the original plan. On every key economicfactor, the Advisors’ plan produces a substan-tial advantage for the taxpayers and stimulatesincreased overall economic vitality.

Timely agreement to this recommendationis particularly critical, as design planning

Total Economic Impact

Original Plan Advisors’ Plan(Central Riverfront (Central Riverfront

Only) + Third Street)

Total Jobs Created 1,336 8,036Total Residents 1,084 1,746

Total New Jobs Created 923 5,020Total New Payroll Impact (000’s) $27,037 $171,856

New Retail Spending (000’s) $19,759 $ 33,706

Total Annual Fiscal Impacts(ex. property taxes)

◆ Annual City Payroll Tax Income (000’s) $ 451 $ 2,868◆ Annual County Sales Tax Revenue (000’s) $ 198 $ 337

Total Annual Revenue Generated (000’s) $ 649 $ 3,205

20-Year Present Valueof Annual Revenue (000’s) $7,444 $36,761

for the above-ground garages was sched-uled to start in September. Further, ThirdStreet development needs to proceedquickly to minimize the need for short-term parking alternatives.

To meet the County’s total parking commit-ments, the Advisors’ plan also requires thatthe Crossett site west of the Paul BrownStadium is used for parking. This must besupported by the Bengals, Reds and Firstar, aswell as the City and County.

The City and County should quickly dowhatever is necessary to make theCrossett site available.

0

10

20

30

40

Mil

lion

s

CRA Total RDA

$7,444

$3,205

$36,761

$649

Tax Impact of Riverfront Advisors Plan

Annual FiscalImpact

20 YearPresent Value


27

6. The City, County and privatesector should collaborate to fundthe public infrastructure and ameni-ties required to attract and supportprivate development.

This funding would involve developer landlease payments, Tax Increment Financing(TIF) from the City, allocation of a small por-tion of unobligated County sales tax revenues,and subordinate bonds purchased by privatelending institutions.

The City should use maximum TIFauthority in the Riverfront DevelopmentArea and work with the County to combine the economic incentives of TIFand parking.

The riverfront development will positivelyimpact public school funding. All TIF calcula-tions provide full tax revenues to CincinnatiPublic Schools, consistent with the prioragreement between the City of Cincinnati andCincinnati Public Schools.

As detailed earlier, the expenditure for TheBanks development supported by this plantotals $248 million. A total of $150 millionalready has been funded by the City andCounty ($14.5 million for utilities; $135.5 mil-lion for above-ground parking). A total of $98million remains to be funded. The chartbelow details the funding plan ($46 millionfor street grids and $52 million for Advisor-recommended enhancements).


The proposed program, detailed in the chartbelow, is a broad, conceptual financing pro-gram. Substantial additional work by the Cityand County and their bond/legal counsel willbe needed to refine and implement this plan.Nonetheless:◆ the overall concepts are financially sound◆ the basic assumptions are conservative◆ the methods are used widely in the

private sector.

Original Advisors’ Recommended ProgramProgram (Move Garages to Third Street)

Keep Garages Scenario 1 Scenario 2 Scenario 3in Central 0% 3rd St. 25% 3rd St. 50% 3rd St.Riverfront TIF “Capture” TIF “Capture” TIF “Capture”

Unfunded Riverfront $ 98,000,000 $ 98,000,000 $ 98,000,000 $ 98,000,000Development Costs

Less: Potential SourcesA. Developer contribution to $ 4,761,000 $ 6,014,000 $ 6,014,000 $ 6,014,000

land costB. TIF Proceeds (100% of 28,442,000 35,932,000 35,932,000 35,932,000

Central Riverfront Area)C. TIF Proceeds (% “Capture” - 14,405,500 28,811,000

Third Street Area)Subtotal $ 33,203,000 $ 41,946,000 $ 56,351,500 $ 70,757,000

Resulting (Gap)/Excess $ (64,797,000) $ (56,054,000) $ (41,648,500) $ (27,243,000)

D. Sale of Subordinate Bonds $ 64,797,000 $ 56,054,000 $ 41,648,500 $ 27,243,000 Paying 7.5% Interest(Amount Required to Break-even)

Advisors’ Funding Concept Plan


28

possible to capture a portion of the TIFgenerated by Third Street development ashigher rents and values become support-able. This is reflected in Scenarios 2 and 3.

The resulting key variable is the level ofsubordinate debt required. The Advisorsbelieve any of these scenarios is feasible, asdiscussed below.

◆ Unobligated County Sales Tax Revenue:Hamilton County sales tax revenues play amajor role in funding riverfront develop-ment. The Advisors believe it also shouldplay a role in stimulating a maximumamount of private investment. The bondsthat are funding the stadium and parkingconstruction were underwritten and thefinancial model recommended by bondcounsel was projected assuming 2% annualgrowth in sales tax revenues. The Countynow anticipates that it will need all tax revenues up to a 3% growth rate to coverall of its costs and retire its debt accordingto schedule.

If we conservatively assume an actualgrowth rate of 3.5-4.0%, there will be a sig-nificant amount of unobligated sales taxrevenues to generate additional funding forriverfront infrastructure and improvementsto support the stadiums and public accessto them. This 3.5-4.0% growth rate range isreasonable compared to the past ten- andfive-year average annual growth of 5.0%and 5.8%, respectively.

The Advisors recommend that a smallportion of the anticipated unobligatedrevenue be used to support a new privateplacement of subordinate bonds.

◆ Subordinate Bonds: To complete thefinancing plan, the Advisors recommendthat the subordinate bond issue be private-ly placed with local lending institutions tocover the remaining costs of infrastructure.Based on the availability of unobligatedCounty sales tax revenues, it appears abond issue paying between 7-8% interest (amost conservative estimate by any mea-sure) could be supported in an amount tofund between $44-$108 million, which sup-ports any of the funding scenarios, shownon previous page.

The actual bond amount will vary depend-ing on final underwriting, expenses, financ-ing terms, and other factors. These bondswould be fully subordinate to all primaryCounty financing for the Riverfront.

The Advisors recommend that the Countyimmediately begin to explore how to exe-cute this placement by consulting withbond and legal counsel, Public FinancialManagement, and other parties.

In total, the Advisors believe this financingprogram is fully achievable. While it requiresall parties – the City, County, and private sec-tor – to adopt a strengthened spirit of cooper-ation, the financial risks are very reasonable.In fact, this financing program involves farless risk than recent investments in develop-ments such as the Newport Aquarium. Webelieve this program offers an excellent opportu-nity for true public-private partnership throughwhich all the parties benefit. Most importantly, itsubstantially increases the community’s oppor-tunity for future economic vitality.

“Fully leveraging this

opportunity — and its

commensurate econom-

ic benefits — will

require a well-conceived

overall master plan and

top-level execution,

including some

increment of additional

public investment to cre-

ate the conditions to

foster major private

development.”

— Patrick L. Phillips, Senior Vice PresidentEconomics Research Associates

◆Financing Elements◆ Developer Land Lease Payments:

Analyses by Economics Research Associates(ERA) indicate that based on the costs andpotential revenues from the developmentprojects, developers can afford to pay theequivalent of $6.0 million (net presentvalue of future land lease payments) andstill receive the required return on invest-ment. While this will surely be an area ofsignificant negotiation between developersand the City, ERA studies suggest it is rea-sonable to assume this modest contributionto the overall financing structure.

◆ Tax Increment Financing: Tax IncrementFinancing occurs when a public entityagrees to use the incremental tax revenuesproduced by new development to financepublic improvements that enhance the fea-sibility of the new project.

The incremental tax revenues associatedwith the Advisors’ recommended plan sup-port bonded debt of $35.9 million. This is$7.5 million above the level supported bythe original plan, reflecting the increasedCentral Riverfront development area creat-ed when above-ground parking is movednorth of Third Street. 100% of the CentralRiverfront Area TIF would fund Riverfrontdevelopment costs. Details are provided inAppendix V, Schedule 15.

City officials indicate current market eco-nomics dictate 100% of TIF will likely beneeded to make new Third Street projectseconomically feasible. This is reflected inScenario 1 in the chart on previous page.As the development progresses, it may be


29


7. The City, County and privatesector (through DCI) should jointlycreate an interim parking and shut-tle program to address the near-term shortfall in downtown parkingspaces which accrue from shiftingthe above-ground garages.

When the Advisors’ plan is completed inabout 2006, downtown parking will be signifi-cantly enhanced, providing for the needs ofall stakeholders. Nonetheless, Urban DesignAssociates (UDA) analyses indicate a short-term parking plan is needed to ensure theCounty can meet its parking commitments tothe Bengals and Reds, and meet the needs ofthe Central Business District and Firstar to themaximum extent possible. While interimshortages will cause challenges in the shortterm, they will also allow the best long-termplan for the region to be created.

The overall shortfalls of spaces are not large,as detailed in UDA’s assessment in AppendixVII, and can be addressed cost-efficientlythrough use of temporary surface parking atfringe locations (Broadway Commons,Northern Kentucky, Hilltop, etc.) combinedwith convenient shuttle service.

The cost of the shuttle solution, estimated byUDA, is very small in comparison to the long-term loss of development potential and taxrevenue if above-grade parking garages arebuilt now in the Central Riverfront develop-ment as currently planned. Other cities,including Pittsburgh, Charlottesville, Norfolk

and Chattanooga, have successfully used per-manent and temporary fringe/shuttle solutions.

The Advisors strongly concur that this solutionshould be used to address short-termRiverfront parking needs, in light of thetremendous long-term benefits to the commu-nity and greater return to the taxpayers.

Further, the Advisors recommend thatDowntown Cincinnati, Inc. take the lead incoordinating efforts with the City andCounty to define and implement a short-term plan.

8. The Banks development shouldstimulate economic inclusion amongall ages, races and genders in allaspects, including design, construc-tion, execution and operation.

Guidelines for economic inclusion should bepart of the Request For Proposals and finaldeveloper agreement.

A joint public-private fund of a minimumof $3 million, The Banks EntrepreneurialEquity Fund, should be established tostimulate participation of small andminority-owned businesses.

This Fund would help fund start-up costs,including possible seed capital, rent subsidyand bridge financing. We recommend thisfund be developed as a joint initiative amonglocal banks, private funds, and various public sources.

While interim park-

ing shortages will

cause challenges in

the short term, they

will also allow the

best long-term plan

for the region to

be created.


30


9. The Central Riverfront should bedeveloped in phases to reflect mar-ket demand and stadium, FreedomCenter and Riverfront Park develop-ment timetables.

The first projects to be completed will be PaulBrown Stadium and Fort Washington Way, inAugust 2000. At this point, additional develop-ment can begin, starting on the west end ofThe Banks.

Phase I, totaling about 2.0 million square feet,would potentially be completed in 2003, inconjunction with the opening of the RedsBallpark and Freedom Center. Phase II, total-ing about 1.6 million square feet, wouldpotentially be completed in 2006. This isabout the same time as the Riverfront Park isnearing completion, although the park will bedeveloped in phases. Details of CentralRiverfront project phasing are provided inAppendix V, Schedule 3.

The Third Street developments should pro-ceed as quickly as possible with as much as 1million square feet of current potential pro-jects completed by 2003.

Central Riverfront development will begin in Fall,2000 when Paul Brown Stadium is completed.

Development Phases

Retail & Residential Entertainment Office Hotel Total

(Units) (000’s sf) (000’s sf) (Rooms) (000’s sf)Phase I (2003)Central Riverfront 492 237 126 — 855Third Street 200 150 775 — 1,125

Total 692 387 901 — 1,980

Phase II (2006)Central Riverfront 258 57 50 225 545Third Street 200 50 800 — 1,050

Total 458 107 840 225 1,595

Anchor Completion Schedule • Paul Brown Stadium 2000• Reds Ballpark 2003• Freedom Center 2003• Riverfront Park 2006


31

The Central Riverfront will be done in twomajor phases.

Major PhasesPhase I: 2000-2003Phase II: 2003-2006



10. The City and County shouldjointly create a RiverfrontDevelopment Commission (RDC) tooversee the development andensure implementation of TheBanks’ vision.

Generally, the RDC should be charged withcoordinating public and private developmentactivities at The Banks to ensure implementa-tion of the vision articulated in this report.This group must have authority to make deci-sions, and must have the support of the Cityand County to ensure cooperation among themany parties involved.

The RDC should have four responsibilities:

◆ Review Developer Proposals and Assistwith Developer Selection: Consistentwith their charge, the Riverfront Advisorswill assist in preparing the Request forProposals (RFP) and reviewing proposalsuntil the RDC is created, seated and func-tioning. Once created, the RDC would pickup on work in this area begun by theRiverfront Advisors. The RDC should workwith the City and County to review devel-oper submissions in response to the RFPand, ultimately, recommend a developer(s)for selection.

◆ Developer’s Advocate: The RDC shouldserve as an advocate for the developer(s)with the many entities involved in TheBanks. By any measure, development ofThe Banks will be complicated. Nothing

inhibits development more than uncertaintyand unanswered questions. An advocate isrequired who understands the complexityof the development and where to go foranswers to developers’ questions, and whohas the authority and the ability to actuallyadvocate for the future of The Banks.

◆ Participation in Amending CincinnatiZoning Code: If it is determined necessaryto amend the City of Cincinnati ZoningCode (see Recommendation 3), the RDCshould be an active participant in thatprocess, and formally recognized as suchby the Cincinnati Planning Commission.One of the greatest inhibitors to aggressive,creative development in Cincinnati is a per-ception, with some justification, that exces-sive governmental oversight and restrictionsdiminish private sector interest and, thus,investment. The RDC would ensure thatamendments to the Cincinnati Zoning Codeincorporate appropriate minimum guide-lines for development.

◆ Ensuring Ongoing OperationalManagement: The RDC should work withthe City, County and developer(s) to estab-lish an entity that has the capacity for on-going management of The Banks. Thisentity must ensure the development is asafe, clean and inviting place for residentsand visitors alike. This entity should alsoensure strong transportation links andeffective, aggressive marketing of TheBanks as a destination, and should leveragemarketing dollars with other organizationsinvolved in convention, tourism, entertain-ment and economic development activities.

This group must

have authority to

make decisions, and

must have the sup-

port of the City and

County to ensure

cooperation among

the many parties

involved.

32


33

Looking to the Futureto try to answer the key questions, and tocome up with solid, realistic, achievable rec-ommendations. We believe the programdetailed in this report will dramaticallyadvance the rebirth of the riverfront.

While in large measure, we have addressedfive of the seven elements of the objectivesgiven us by the City/County SteeringCommittee, important work remains for theRiverfront Advisors Commission. We must par-ticipate with the City in the review of propos-als from developers and recommend a devel-opment team to the City/County RiverfrontSteering Committee. In addition, we will con-tinue to help build community consensusamong key stakeholders, and to advise on ourrecommendations.

The work that lies ahead is complex. But thevision is achievable. It is achievable because itis grounded in serious economic realities,built on the prospect of strong public-privatepartnership, and reaches out to fulfill thedesires of the people of the region. And wemust achieve it, because to do anything elseis to compromise the great potential of theRebirth of the Riverfront and the very futureof our city.

In this spirit of optimism and com-

mitment, it is fitting to end where

we began, with...

We believe the program detailed in this

report will dramatically advance the

rebirth of the riverfront.

In this report we have endeavored todeliver the mission given us:

Define and reach community con-

sensus on a development plan and

implementation strategy for

Cincinnati’s riverfront that will

cause it to be our most cherished

community asset: a place for public

enjoyment, residential living, educa-

tion, festivals, cultural and sporting

events with supporting retail, com-

mercial and housing development

that will make a signature state-

ment about our city to the world.

To that end, we have extended what wasintended to be a five-month study to ninemonths. We asked for the extra time becausewe wanted to be thorough. We owed it to theRiverfront Steering Committee, and to our fel-low citizens, to look at a full range of options,

The Banks is the shining centerpiece of our region,

reflecting excitement, energy, a new sense of pride and renewed connection with our River. It is a place people call home. It is a place where people work and shop and party and visit. It is a place where people cheer the home team, celebrate freedom,

and honor our rich diversity. It is a place for playful enjoyment

and quiet reflection. It is a place for everyone, citizen and visitor alike. It is a place to come again

and again. It is an engine to drive economic growth and new vitality in Cincinnati, Northern

Kentucky, and our entire region. It is a place that links us

together, it is a new spirit of cooperation. It is an experience

that elevates our city to true world-class status. It is our potential. It is our future.

— A V i s i o n —


34

Back Row, Left to Right:

David Anderson

Jeanne H. Schroer

Paul Muller

Eric H. Kearney

J. Joseph Hale, Advisors Vice-Chair

Steven R. Love

Norman Miller

Not Pictured:

Ronald B. Kull

Laura L. Long

Frank Wood

Front Row, Left to Right:

Clifford A. Bailey

Thomas H. Humes, Jr.

Jack Rouse, Advisors Chair

Charlotte R. Otto

Nicholas J. Vehr

Insets, Left to Right:

Otto M. Budig, Jr.


35

Appendix I: Riverfront Advisors Commission / The Motions of Cincinnati City Council and Hamilton County Commissioners

David Anderson, Director, Civic &Promotional Affairs, Delta Airlines

Clifford A. Bailey, President & CEO,TechSoft Systems

Otto M. Budig, Jr., President, Budco Group

J. Joseph Hale, Jr., President, Cinergy Foundation

Thomas H. Humes, Jr., President, Great Traditions Land & Development Company

Eric H. Kearney, Esq., Attorney, Cohen, Todd, Kite & Stanford, L.L.C.;President & CEO, SeshCommunications

Ronald B. Kull, Associate Vice Presidentand University Architect, University of Cincinnati

Laura L. Long, Executive Director,Cincinnati Business Committee

Steven R. Love, Vice President/General Manager, Blue ChipBroadcasting Company

Norman Miller, Director of Real EstateProgram, College of BusinessAdministration, University ofCincinnati

Paul Muller, Principal, Muller &Associates, Architects

Charlotte R. Otto, Global Public AffairsOfficer, The Procter & GambleCompany

Jack Rouse, CEO, Jack Rouse Associates

Jeanne H. Schroer, Senior VicePresident, Corporate Development,Corporex

Nicholas J. Vehr, President, Cincinnati2012; Vice President, Dan PingerPublic Relations, Inc.

Frank Wood, President & CEO, Secret Communications

Consultants to the Advisors:John Shirey, City Manager,

City of Cincinnati

David J. Krings, Hamilton CountyAdministrator

Donald K. Carter, Principal, UrbanDesign Associates

Terry Evans, Assistant Director ofStadium Development, HamiltonCounty

Mark McKillip, Principal Architect,Architecture & Urban Design, City of Cincinnati

Patrick L. Phillips, Senior Vice President,Economics Research Associates

Graphic Design:Andy Ruttle, Principal Designer,

Ruttle Design Group, Inc.

1

Appendix V: Financial/Economic/Parking Summary1

Introduction Cincinnati’s Riverfront has great potential to be a significant catalyst for the revitalization of the urban core and the economic development of the entire region. This sub-committee of the Riverfront Advisors Commission was responsible for recommending a conservative, fiscally responsible approach to maximizing this area’s long-term development potential with consideration of some complex physical and financial issues. This sub-committee was also asked to determine how the public expenditures required for its recommended development program would be funded. The recommendations and information provided in this report are the result of a collaborative effort between the RAC sub-committee, the staff of various departments of the City of Cincinnati, Hamilton County, and their consultants in the areas of parking, design, public finance, and economic and market analysis. During July and August 1999, these groups attended a series of meetings in which information was shared and solutions to the very complex issues surrounding this project were discussed. We hope that this spirit of collaboration among these units of government and outside experts will continue into the implementation phase of this project because this cooperation and sharing of ideas is vital to maximizing the potential of our region’s most visible and promising resource. Purpose and Scope The purpose of this report is to provide recommendations for Riverfront development that will ensure: �� That all projects within the development area will be financially successful long term. �� That Riverfront development contributes to the revitalization of the entire urban core. �� That significant public investment is leveraged to maximize and sustain private investment

in the area. �� That public investment is made in a planned, conservative and fiscally responsible manner

that considers the cost versus benefits of such investment.

1 Prepared by the Riverfront Advisors Commission, September 30, 2001

2

To make these recommendations, the committee’s study includes the following: �� Overall analysis of both the Central Riverfront Area (CRA) defined as the land south of Ft.

Washington Way and between the two stadiums as well as the Third Street Development Area (Third Street) defined as the blocks adjacent to the primary Riverfront area between Third and Fourth Streets. The entire area in the scope of this report is referred to as the Riverfront Development Area (RDA).

�� A development use program for each block of the Central Riverfront Area quantified in

terms of ranges of units and/or square footages and an indication of phasing of the development program.

�� Demand justification for each development category. �� An analysis of the development potential of sites located in the Third Street Development

Area. �� A calculation of the parking requirements for all Riverfront uses including both stadiums as

well as the proposed development program. �� An estimate of all public infrastructure costs and amenities required to support the public

and private development programs. �� An analysis of the revenue generating potential of the proposed development program in

both the Central Riverfront and Third Street Areas through TIF revenues and other City and County annual income sources.

�� Identification of approaches for leveraging the public investment in the Riverfront

Development Area to maximize private development contribution to infrastructure costs. �� Identification of other solutions and tools that have been successfully used in other cities to

create and maximize riverfront development opportunity. �� Analyses from Riverfront Advisors Commission consultants Urban Design Associates (UDA)

and Economic Research Associates (ERA).

3

Summary of Recommendations The Committee’s major recommendations are based on the following concepts and are supported by the information and analysis contained in later sections of this report. �� By adding just $52 million to the scope of total expenditures ($1.27 billion) currently

budgeted for Riverfront development, and reallocating approximately $17 million of County funds for parking garages to the Third Street Development Area, the public’s significant public investment will be maximized to create nearly four times the economic development impact than it would otherwise. As Schedule 1 indicates, the current plan for the Riverfront requires a $195.9 million public investment that will generate $159.1 million in private investment, a return of public investment of only 81%. The Riverfront Advisors Commission’s recommended program requires a $247.9 million public investment. The resulting economic development impact, however, is $600.5 million, which is a return of public investment of 242%.

�� It is very beneficial to use funds allocated to the Riverfront in a manner that also stimulates

development along Third Street. By doing so, the economic impact described above is expanded and the fiscal benefits to the City and County increase significantly. Schedule 2 shows the tax benefits of the Riverfront Advisors Commission’s plan to the City and County in terms of annual revenues (excluding property taxes) and the 20-year present value of these impacts. The 20-year present value of tax revenues to the City and County increases from $7.4 million to $36.8 million when the Third Street Area is stimulated as part of the RAC recommendations.

�� The recommendations proposed below can be funded by a collaborative effort and pooling

of resources among the City, County, and private sector institutions. �� The expenditures related to Riverfront Advisors Commission’s plan are essential to create

an environment in the Riverfront and linkages with the CBD that attracts quality development to the Riverfront and Third Street. The recommended plan also provides development flexibility to respond to the changes in market conditions likely to occur over a long development cycle.

�� It is not in the region’s best interest to program Riverfront development to solve short-term

problems because such an approach significantly limits the CBD’s long-term potential and viability.

4

Riverfront Advisors CommissionSchedule 1

Summary - Economic Development Impact of RAC Plan


Public Expenditure in 196,000,000$ 248,000,000$ Central Riverfront Area

Street Grid 46,000,000$ Street Grid 46,000,000$ Utilities 15,000,000$ Utilities 15,000,000 Parking 135,000,000$ Parking 135,000,000 Total 65,000,000$ Subtotal 196,000,000$

FWW Covers/Green Spaces 39,000,000$ Boardwalk at the Banks 8,000,000 Public Green Space 5,000,000 Subtotal 52,000,000$

Shift parking to Third Stret -$

Private Investment 159,000,000$ 600,000,000$ 600,000,000$

Return of Public Investment 81% 242%(ROPI)


$196,000,000 $196,000,000

$159,000,000

$600,000,000

$52,000,000

$0

$100,000,000

$200,000,000

$300,000,000

$400,000,000

$500,000,000

$600,000,000

$700,000,000

$800,000,000

$900,000,000

Currrent Program RAC Recommended

Axi

s T

itle Private Investment

RAC Additional Costs

Public Expenditure

5


Tax Impacts of Riverfront Development

CentralRiverfront Third Street Total

Tax Impacts Area Area RDANet Annual City Income Tax 451,000$ 2,417,000$ 2,868,000$ Annual Hamilton County Retail Sales Tax 198,000$ 139,000$ 337,000$ Total Tax Impacts (excluding real estate taxes) 649,000$ 2,556,000$ 3,205,000$

20 Year Present Value of Revenue 7,444,000$ 29,317,000$ 36,761,000$

Notes:(1) Above estimates are conservative due to the fact that ERA’s figures are based on lower square footages for the Central Riverfront Area than the current RAC plan indicates.(2) Source: ERA(3) Real estate taxes not included becausethey will likely be used for TIF.

Tax Impacts of Riverfront Advisors Plan

$649,000$2,556,000 $3,205,000

$7,444,000

$29,317,000

$36,761,000

$-

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

$30,000,000

$35,000,000

$40,000,000

CRA Third Street Total RDA

Annual Fiscal Impact

20 Year Present Value

6

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un

ty s

ales

tax

rev

enu

es, a

nd

pri

vate

len

din

g in

stit

uti

on

pu

rch

ase

of

sub

ord

inat

e b

on

ds.

The

pub

lic in

fras

truc

ture

cos

ts a

nd a

men

ities

nec

essa

ry to

sup

port

qua

lity

priv

ate

deve

lopm

ent i

n th

e C

EN

TR

AL

RIV

ER

FR

ON

T

AR

EA

tota

l app

roxi

mat

ely

$98

mill

ion.

Thi

s in

clud

es th

e st

reet

grid

cos

t of $

46 m

illio

n pl

us a

noth

er $

52 m

illio

n an

ticip

ated

by

the

Riv

erfr

ont A

dvis

ors

Com

mis

sion

’s p

lan

for

pede

stria

n pl

azas

cov

erin

g m

ost o

f For

t Was

hing

ton

Way

, bui

ldin

g T

he B

oard

wal

k at

th

e B

anks

, and

cre

atin

g ad

ditio

nal g

reen

spa

ce th

roug

hout

the

deve

lopm

ent.

Thi

s $5

2 m

illio

n re

pres

ents

onl

y a

4% in

crea

se o

ver

the

tota

l am

ount

of p

ublic

inve

stm

ent c

urre

ntly

bud

gete

d fo

r th

e R

iver

fron

t are

a. P

ossi

ble

fund

ing

appr

oach

es u

nder

two

poss

ible

sce

nario

s ar

e as

follo

ws:

8

Sce

nar

io 1

– (

Cu

rren

t P

lan

):

Ab

ove

-gro

un

d p

arki

ng

gar

ages

are

bu

ilt o

n B

lock

s 1

and

4 a

s cu

rren

tly

pla

nn

ed.

F

un

din

g S

ou

rces

: S

uppo

rtab

le B

ond

Deb

t fro

m T

IF R

even

ue in

CR

A *

-

$ 2

8,44

2,00

0 D

evel

oper

Con

trib

utio

n to

Lan

d V

alue

* -

$

4,76

1,00

0 P

rivat

e S

ubor

dina

te B

onds

Sec

ured

by

Uno

blig

ated

Sal

es T

ax R

even

ues

-

$ 6

4,79

7,00

0 T

ota

l

$

98,0

00,0

00

In

fras

tru

ctu

re &

Am

enit

y C

ost

s:

($98

,000

,000

)

Res

ult

ing

(G

ap)/

Exc

ess:

$ 0

*

Th

is s

cen

ario

cau

ses

loss

of

291,

600

squ

are

feet

fro

m R

AC

rec

om

men

ded

dev

elo

pm

ent

pro

gra

m.

T

ota

l Eco

no

mic

Ben

efit

s (C

entr

al R

iver

fro

nt

Are

a O

nly

):

P

oten

tial T

IF

$

28,

442,

000

P

rivat

e In

vest

men

t $

$1

59,0

74,0

00

Tot

al J

obs

Cre

ated

1,33

6

Tot

al R

esid

ents

1,08

4

T

otal

New

Job

s Im

pact

923

Tot

al N

ew P

ayro

ll Im

pact

$ 2

7,03

7,00

0

T

otal

New

Ret

ail S

pend

ing

(Ann

ual)

$ 1

9,75

9,00

0

To

tal A

nn

ual

Fis

cal I

mp

acts

(E

xclu

din

g P

rop

erty

Tax

es)

Ann

ual C

ity P

ayro

ll T

ax In

com

e

$45

1,00

0

A

nnua

l Cou

nty

Ret

ail S

ales

Tax

Rev

enue

$19

8,00

0

To

tal A

nn

ual

Rev

enu

e G

ener

ated

$

649,

000

20

-Yea

r P

rese

nt

Val

ue

of

An

nu

al R

even

ue

$7,

444,

000

9

Sce

nar

io 2

– (

RA

C R

eco

mm

end

ed P

lan

): A

bo

ve-g

rou

nd

par

kin

g g

arag

es o

n B

lock

s 1

& 4

are

elim

inat

ed a

nd

sp

aces

rep

lace

d in

d

evel

op

men

t p

roje

cts

loca

ted

no

rth

of

Th

ird

Str

eet.

C

ou

nty

allo

cate

s ca

pit

al f

un

ds

earm

arke

d f

or

thes

e g

arag

es t

o p

ay f

or

par

kin

g in

Th

ird

Str

eet

pro

ject

s th

us

acce

lera

tin

g p

riva

te in

vest

men

t b

eyo

nd

th

e C

RA

. T

his

co

uld

als

o a

llow

th

e C

ity

to c

aptu

re a

p

ort

ion

of

the

TIF

rev

enu

e fr

om

so

me

of

the

Th

ird

Str

eet

pro

ject

s to

co

ver

infr

astr

uct

ure

co

sts

in t

he

RD

A.

Fu

nd

ing

So

urc

es:

Sup

port

able

Bon

d D

ebt f

rom

TIF

Rev

enue

in C

RA

-

$ 35

,932

,000

D

evel

oper

Con

trib

utio

n to

Lan

d V

alue

-

$ 6

,014

,000

P

rivat

e S

ubor

dina

te B

onds

Sec

ured

by

Uno

blig

ated

Sal

es T

ax R

even

ues

-

$ 56

,054

,000

T

ota

l

$

98,0

00,0

00

In

fras

tru

ctu

re &

Am

enit

y C

ost

s:

($

98,0

00,0

00)

R

esu

ltin

g (

Gap

)/E

xces

s:

$0

‘* P

ote

nti

al t

o in

crea

se T

IF b

y u

p t

o $

28,8

11,0

00 if

a p

ort

ion

of

Th

ird

Str

eet

TIF

rev

enu

es c

an b

e “c

aptu

red

” fo

r th

e R

iver

fro

nt.

At

a m

inim

um

, allo

cati

ng

$17

mill

ion

in C

ou

nty

fu

nd

ing

fo

r g

arag

es t

o T

hir

d S

tree

t p

roje

cts

may

fre

e u

p a

like

am

ou

nt

Th

ird

Str

eet

TIF

fo

r th

e R

iver

fro

nt.

T

ota

l Eco

no

mic

Ben

efit

s (C

entr

al R

iver

fro

nt

and

Th

ird

Str

eet

Are

as):

P

oten

tial T

IF

$ 9

3,55

4,00

0

Priv

ate

Inve

stm

ent $

$

600,

446,

000

Tot

al J

obs

Cre

ated

8,

036

T

otal

Res

iden

ts

1,

746

Tot

al N

ew J

obs

Impa

ct

5,02

0

Tot

al N

ew P

ayro

ll Im

pact

$17

1,85

6,00

0

Tot

al N

ew R

etai

l Spe

ndin

g (A

nnua

l)

$

33,7

06,0

00

To

tal A

nn

ual

Fis

cal I

mp

acts

(E

xclu

din

g P

rop

erty

Tax

es)

Ann

ual C

ity P

ayro

ll T

ax

$ 2

,868

,000

A

nnua

l Cou

nty

Ret

ail S

ales

Tax

Rev

enue

$

337

,000

T

ota

l An

nu

al R

even

ue

Gen

erat

ed

$ 3

,205

,000

20

-Yea

r P

rese

nt

Val

ue

of

An

nu

al R

even

ue

$

36,7

61,0

00

10

The

adv

anta

ges

and

disa

dvan

tage

s of

the

two

scen

ario

s ar

e su

mm

ariz

ed b

elow

: S

cen

ario

1 –

Cu

rren

t P

lan

(P

arki

ng

Gar

ages

on

Blo

cks

1 &

4)

Sce

nar

io 2

– R

AC

Rec

om

men

ded

Pla

n (

Elim

inat

e ab

ove

g

rou

nd

par

kin

g in

CR

A a

nd

Rep

lace

in O

ffic

e P

roje

cts

No

rth

of

Th

ird

)

A

dva

nta

ges

A

dva

nta

ges

��

Sat

isfie

s le

ase

requ

irem

ents

and

issu

es w

ith R

eds,

Ben

gals

, an

d F

irsta

r.

��S

igni

fican

tly in

crea

sed

econ

omic

dev

elop

men

t im

pact

. ($

1of

publ

ic in

vest

men

t ret

urns

ove

r $2

.)

��S

olve

s sh

ort-

term

par

king

pro

blem

s in

CB

D.

��C

reat

es p

oten

tial t

o in

crea

se d

evel

opm

ent s

quar

e fo

otag

e of

re

tail,

res

iden

tial o

r ho

tel d

evel

opm

ent i

f mar

ket w

arra

nts.

��S

igni

fican

tly im

prov

es a

esth

etic

env

ironm

ent i

n C

RA

.

��M

ay p

rovi

de a

dditi

onal

TIF

rev

enue

s fr

om 3

rd S

tree

t Are

a to

fu

nd R

iver

fron

t cos

ts.

��

Incr

ease

s pr

esen

t val

ue o

f City

/Cou

nty

annu

al in

com

e an

d sa

les

tax

inco

me

from

$7.

4 m

illio

n to

$36

.7 m

illio

n.

Dis

adva

nta

ges

D

isad

van

tag

es

��Lo

ss o

f priv

ate

deve

lopm

ent (

291,

600

sq. f

t.) o

n B

lock

s 1

& 4

re

sults

in r

educ

tion

of r

esid

ual l

and

valu

e an

d T

IF p

roce

eds.

��

Req

uire

s ap

prov

al o

f Ben

gals

and

Red

s.

��C

reat

es a

esth

etic

neg

ativ

es fo

r F

reed

om C

ente

r, R

eds

Sta

dium

. ��

Req

uire

s ne

gotia

tion/

agre

emen

t with

Thi

rd S

tree

t pro

pert

y ow

ners

. ��

Red

uced

eco

nom

ic d

evel

opm

ent i

mpa

ct.

($1

of p

ublic

in

vest

men

t ret

urns

less

than

$1

in p

rivat

e in

vest

men

t.)

��T

imin

g of

del

iver

y of

par

king

site

s is

less

cer

tain

req

uirin

g so

lutio

ns to

sho

rt-t

erm

par

king

issu

es.

��Li

mits

pot

entia

l dev

elop

able

squ

are

foot

age

in C

RA

.

The

rat

iona

le s

uppo

rtin

g th

ese

reco

mm

enda

tions

is c

onta

ined

in th

e fo

llow

ing

sect

ions

.

11

Rec

om

men

ded

Ran

ges

of

Dev

elo

pm

ent

Use

s an

d P

has

ing

T

he e

cono

mic

ana

lyse

s co

ntai

ned

in th

e fo

llow

ing

sect

ions

of t

his

repo

rt a

re b

ased

on

the

deta

iled

Pro

pose

d D

evel

opm

ent P

rogr

am

by B

lock

for

the

Cen

tral

Riv

erfr

ont A

reas

, the

Thi

rd S

tree

t Are

as, a

nd P

oten

tial L

ong

Ter

m P

roje

cts

cont

aine

d in

Sch

edul

es 3

, 4, a

nd

5. T

he p

rogr

am r

ecom

men

datio

ns a

re p

rese

nted

in r

ange

s to

allo

w fl

exib

ility

to e

valu

ate

deve

lopm

ent p

roje

ct p

ropo

sals

with

in th

e co

ntex

t of c

urre

nt m

arke

t dem

and

cond

ition

s. S

peci

fic s

quar

e fo

otag

es a

nd u

nits

wer

e us

ed fo

r pu

rpos

es o

f fin

anci

al a

naly

sis.

A

sum

mar

y of

the

prog

ram

use

and

pha

sing

sch

edul

e fo

r P

hase

s I a

nd II

is a

s fo

llow

s:

P

roje

ct S

um

mar

y b

y U

se a

nd

Ph

asin

g

P

rod

uct

Mix

P

arki

ng

R

esid

enti

al

(Un

its)

R

etai

l O

ffic

e H

ote

l T

ota

l Sq

uar

e F

eet

Ded

icat

ed

Pro

ject

P

roje

ct/P

ub

lic

Co

mb

inat

ion

P

has

e I –

C

om

ple

tio

n in

200

3

CR

A *

49

2 23

7,00

0 12

6,00

0 0

855,

000

789

T

hird

Str

eet

200

150,

000

775,

000

0 1,

125,

000

4,

350

To

tal

692

387,

000

901,

000

0 1,

980,

000

789

4,35

0

B

enga

ls S

tadi

um (

2000

) R

eds

Sta

dium

(20

03)

Fre

edom

Cen

ter

(200

3)

Ph

ase

II –

Co

mp

leti

on

in 2

006

CR

A *

25

8 57

,000

50

,000

22

5 54

5,00

0 52

0 0

Thi

rd S

tree

t 20

0 50

,000

80

0,00

0 0

1,05

0,00

0 0

800

To

tal

458

107,

000

850,

000

225

1,59

5,00

0 52

0 80

0

R

iver

fron

t Par

k (2

006)

* If

abo

ve g

roun

d pa

rkin

g ga

rage

s ar

e no

t mov

ed fr

om th

e C

RA

Blo

cks

to n

orth

of 3

rd S

tree

t, C

RA

squ

are

foot

age

redu

ced

by 2

91,6

00.

12

Riv

erfr

on

t A

dvi

sors

Co

mm

issi

on

Sch

edu

le 3

- P

rop

ose

d D

evel

op

men

t P

rog

ram

by

Blo

ckC

entr

al R

iver

fro

nt

Are

a

Sp

ecia

lty

Ded

icat

edR

et./E

nte

rt.

Res

iden

tial

Off

ice

Ho

tel

To

tal

Pro

ject

Sq

. Ft.

Un

its

Sq

. Ft.

Sq

. Ft.

Un

its

Sq

. Ft.

Sq

. Ft.

Par

kin

g (

1)P

has

e I

Blo

ck 1

47,0

00

62

62,0

00

12

6,00

0

235,

000

24

0B

lock

228

,000

34

2

34

2,00

0

370,

000

54

9B

lock

543

,000

43

,000

Blo

ck 6

35,5

00

88

88,0

00

12

3,50

0

Blo

ck 1

033

,000

33

,000

Blo

ck 1

2 (B

oard

wal

k)50

,000

50

,000

Su

bto

tal

236,

500

492

492,

000

12

6,00

0

-

-

854,

500

78

9

Ph

ase

IIB

lock

420

,400

17

0

17

0,00

0

50,0

00

22

5

180,

000

42

0,40

0

520

Blo

ck 8

36,5

00

88

88,0

00

12

4,50

0

Su

bto

tal

56,9

00

258

258,

000

50

,000

225

18

0,00

0

544,

900

52

0

Pri

mar

y P

roje

ct T

ota

l29

3,40

0

75

0

75

0,00

0

176,

000

22

5

180,

000

1,

399,

400

1,30

9

Rec

om

men

ded

Pro

du

ct R

ang

eR

etai

l25

0,00

0 -

300,

000

squa

re fe

et (

ente

rtai

nmen

t/res

taur

ant/s

peci

alty

onl

y -

no "

big

box"

)R

esid

entia

l60

0 -

800

units

Off

ice

100,

000

- 20

0,00

0 sq

uare

feet

Hot

el20

0 -

400

room

s

No

tes:

(1)

Par

king

spa

ces

quan

tifie

d he

re in

clud

e th

ose

that

mus

t be

dedi

cate

d to

the

deve

lopm

ent u

se in

dica

ted.

Ret

ail/e

nter

tain

men

t par

king

can

be

shar

ed w

ith s

tadi

um p

arki

ng

Ded

icat

ed p

arki

ng s

pace

s fo

r th

e ot

her

uses

was

cal

cula

ted

by U

DA

as

follo

ws:

R

esid

entia

l - 1

.5 s

pace

s/un

it

O

ffice

- 1

0% o

f 4 s

pace

s/1,

000

sf

H

otel

- .5

spa

ces/

room

13

Riv

erfr

on

t A

dvi

sors

Co

mm

issi

on

Sch

edu

le 4

- P

rop

ose

d D

evel

op

men

t P

rog

ram

by

Blo

ckT

hir

d S

tree

t D

evel

op

men

t

Ret

ail

Res

iden

tial

Off

ice

Ho

tel

To

tal

Par

kin

gS

q. F

t.U

nit

sS

q. F

t.S

q. F

t.U

nit

sS

q. F

t.S

q. F

t.S

pac

esP

roje

cts

in D

evel

op

men

tQ

ueen

City

Squ

are

(W/S

) (1

)1,

100,

000

1,10

0,00

0

2,

500

T

hird

& R

ace

(Duk

e/W

eeks

)37

5,00

0

375,

000

1,

200

M

cAlp

ins

Site

(M

adis

on M

arq.

)15

0,00

0

20

0

20

0,00

0

TB

D35

0,00

0

650

Mis

cella

neou

s (2

)50

,000

20

0

20

0,00

0

100,

000

35

0,00

0

800

To

tal P

roje

cts

in P

lan

nin

g20

0,00

0

40

0

40

0,00

0

1,57

5,00

0

-

-

2,

175,

000

5,15

0

Rec

om

men

ded

Pro

du

ct R

ang

eR

etai

l15

0,00

0 -

250,

000

squa

re fe

etR

esid

entia

l30

0 -

500

units

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14

The program shown in these schedules was developed with consideration of the following criteria and principles: �� Aesthetics – Relationship of development mass to existing skyline and Ohio River and

maximization of views. (Transition from low scale and density at River to higher scale and density towards CBD).

�� Development phasing and market timing – Availability of development site vs. projected

market conditions in each use category. �� Impact on downtown redevelopment efforts north of Third Street – Uses complementary to,

not competitive with, existing uses in urban core. �� Market demand – Demonstrated demand and feasibility given current and projected market

conditions. �� Economic impact – Contribution to cost of public infrastructure and growth of the urban

core’s economic base. Market Demand The following reports and studies have supported market demand for the above ranges of uses in the total RDA: Housing �� ERA2 estimates housing demand in the CBD to be 800 to 1,400 units over the next 10 years

while DCI suggests potential demand at 1,400 to 4,000 units. �� All recent downtown housing projects have been successful and there appears to be strong

demand for proposed new housing projects at 325 8th Street as well as the Shillitos project. �� The Riverfront area, because of its unique environment, access and views has the best

potential within the CBD for successful urban housing development. �� A quality housing development in the 200-unit range has been programmed for the site just

west of the Bengals stadium surrounding a proposed marina as a Long Term Potential Project within the RDA.

�� The housing development program within the RDA should encourage a mix of unit sizes

that makes units affordable in many income and age categories. Target markets would include: for-sale and for-rent housing for empty nesters 50 – 70 years old, for-rent units for young working adults in all income categories, single and married.

2 Economics Research Associates was retained by the Riverfront Advisors Commission to provide financial feasibility and market analysis for the Riverfront project.

15

�� Housing supports permanent retail uses and provides a true 24-hour city, unlike sporting events, and is thus the most important element of new private market development along the riverfront.

�� Housing as proposed will need modest or no local subsidy with no federal subsidies

anticipated as long as a single developer is used for both the rental and for-sale markets of all sizes and over the entire absorption period.

�� Exhibit A at the end of this report contains a detailed analysis and an example of a potential

housing mix in terms of unit size and pricing. Retail/Entertainment/Restaurants �� Dr. Norm Miller’s3 studies suggest sufficient demand for additional retail attractions in the

CBD. According to Miller, retail sales in the CMSA have grown from $16 billion in 1993 to $22.5 billion in 1999.

�� There will be a strong demand for entertainment uses within the CRA generated by the

major stadium and museum attractions that must be carefully planned and programmed so as not to negatively impact the proposed residential development.

�� Retail districts within the CBD and the CRA must be linked together to create the critical

mass and variety necessary to attract shoppers downtown. �� “Big box” retail attractions should be retained and encouraged in the CBD north of Third

Street to support and add critical mass to retention and large scale new retail development efforts currently underway.

�� Bias and preference of local citizens is for unique retail in the Central Riverfront Area

that celebrates ethnic and cultural diversity and local history. �� Special funding should be allocated to attract independent, unique, and ethnic retail

establishments to the riverfront, including the creation of The Banks Entrepreneurial Equity fund to help fund start-up costs.

Hotel �� ERA estimates total net new CBD hotel demand at 600 to 1,200 rooms contingent upon

expansion of the convention center. �� No new CBD hotels are currently needed to accommodate existing demand until the

convention center expands. �� Notwithstanding the above, the success of the quality hotels located on Northern Kentucky’s

riverfront suggest that the unique environment to be created in the RDA may attract one or two hotels to our study area.

3 Dr. Norm Miller is the Director of U.C.’s Real Estate Program in the College of Business and is a member of the Riverfront Advisors Commission.

16

�� One to two modest sized boutique hotels, built in Phase II of the development will

have sufficient demand because of the tie-in with special events and unique views and access to downtown. A hotel will compliment the proposed office component as well as providing amenities that are important and might be shared with housing, such as health club facilities.

Office �� According to ERA, the CBD has seen strong office absorption over the last three years and

steady improvement in rental rate growth. However, the Riverfront Advisors Commission believes that the CBD has not attracted its share of new office construction due to perceived problems such as a lack of conveniently-located, affordable parking and a lack of amenities in the urban core.

�� According to Dr. Miller, rents need to increase $2 - $3 per square foot to justify new office

construction in the CBD. �� Within the primary Riverfront area, boutique-sized office developments within a mixed-use

project will find a receptive market for those independent professionals seeking a unique office environment.

�� Since 1990, approximately 600,000 square feet of speculative office space was constructed

and absorbed in Covington, Kentucky. This is a strong indication that the availability of quality, Class A office developments does stimulate corporate relocation and tenant retention in the urban core (e.g., Ashland, Inc.). According to ERA, this is a level of performance that would not have been predicted based on trend data and proves that past trends are not always indicative of future performance.

�� Major corporate office development is recommended to be located in the Third Street

development area. The environment created in the Central Riverfront Area will be key to increasing CBD occupancies, values and rents in order to justify large-scale new construction. By creating this quality environment in the RDA, downtown will become much more competitive with the suburbs.

Parking Parking is one of the most complex and important issues faced by the Advisors and all those involved in Riverfront development planning. It is also a major issue relating to the ability to attract new and retain existing corporate office users and retail customers in facilities located throughout the entire urban core. The current facts relating to Riverfront area parking are as follows: �� The County has committed to fund the construction of approximately 8,300 parking spaces

in the Central Riverfront Area. Of these, approximately 4,600 spaces are contained in a below grade, two level parking garage that will be used as a base for Riverfront development between the two stadiums.

17

�� Schedule 6 shows a detailed parking calculation for the Riverfront Development Area based on The Riverfront Advisors Commission’s plan. A total of 10,340 parking spaces have been identified within the RDA which could be used to satisfy the needs of the Reds, Bengals, and the private developments in the Central Riverfront Area. Based on Reds and Bengals lease requirements as well as the estimated requirements of the proposed development use program, a minimum of 8,809 parking spaces are required in the Central Riverfront Area.

�� The 10,340 space parking calculation was made using three key assumptions:

1. The City-owned Crossett site and adjacent lot, which could accommodate 1,300 cars, is utilized for Riverfront development and stadium parking.

2. One level is added to the Lytle Garage, bringing its capacity to 1,080 cars.

3. Garages located in Third Street projects (Queen City Square and Third & Race or the

McAlpin’s site) contain 1,752 spaces that can be used to satisfy stadium parking needs. The spaces replace those that were originally planned to be located in above-ground garages on Blocks 1 and 4.

�� The Crossett site is essential for meeting the parking requirements of the primary

Riverfront public and private developments. �� A key parking issue identified by the Riverfront Advisors Commission is the proposed

above-ground parking garages located on Blocks 1 and 4. These garages provide 1,752 spaces in the Primary Riverfront Area. The existence of these garages make it difficult for developers to design projects for these blocks. Also, they consume valuable land area that could be used for a higher revenue-generating purpose.

�� Of particular concern is the garage located on Block 4. Apparently, it needs to be designed

this fall; however, it will not be available for commercial development until Phase II of the Central Riverfront Area project (2003 and beyond). Determining the garage design now could severely limit the development potential and flexibility of this block. It should also be noted that about 30% of the economic value, which supports TIF proceeds for the Central Riverfront Area, is generated by the program for this block. (See Schedule 7). We believe commercial development will be significantly limited on this Block under the present parking scenario.

�� The Third Street Development Area has significant potential to provide alternative parking

facilities within proposed office developments. In three projects, Queen City Square (W/S), Third & Race, and McAlpins, approximately 5,150 spaces are planned to be part of office and mixed-use developments. In general, office and special event uses are very compatible. Therefore, the Riverfront Advisors Commission recommend that the spaces contained in the above-ground parking garages on Blocks 1 and 4 be shifted to these Third Street projects. This would have the added benefit of stimulating new office development in the Third Street Area.

�� There are significant issues associated with this recommendation. However, the Riverfront

Advisors Commission believes that they can be resolved with City, County, and private market cooperation.

18

�� UDA has studied these issues and has determined that:

1. The short-term parking shortfalls are not that large. 2. Fringe parking and shuttles can be implemented as low-cost solutions to the problem. 3. Experience in other cities with similar problems, i.e., Pittsburgh, Charlottesville, VA,

Norfolk, VA, and Chattanooga indicates that these solutions are easy to implement. �� Despite the issues above, there are significant benefits to the Riverfront Advisors Plan that

should compel City, County and private sectors to find solutions to the short-term problems. These benefits include:

1. The opportunity to use County funds earmarked for investment in the Riverfront area to

stimulate development in a wider area, which has a much greater economic impact. For example, under the RAC recommended plan, the public investment related to private development under the RAC recommended plan totals approximately $247.9 million including all riverfront parking. The resulting private investment considering the Central Riverfront Area only is $159.1 million or 64% of the public investment amount. If these same dollars are invested in a manner that stimulates the development sites along Third Street, the resulting private investment could be as much as $600.5 million or 242% of the public investment amount. (See Schedules 8 and 9).

2. The potential to “capture” TIF dollars from Third Street projects to fund Riverfront improvements and amenities. As will be discussed in the following section, total TIF dollars from Third Street projects are approximately $57.6 million - a significant pool of additional capital for the economic development of the entire urban core.

3. The ability to replace space used by parking garages with higher value commercial or

residential development if market conditions warrant. 4. General improvement in the aesthetics of the Riverfront project which will enhance

values within and adjacent to the RDA. �� The Riverfront Advisors recommend that above-ground public garages be shifted to areas

north of Third Street. Please note that revenue to the Reds, Bengals and Firstar would remain the same under this scenario.

�� It would be very detrimental to the economic development of our region to limit the

long-term economic potential of the Riverfront and the CBD in order to solve short-term parking problems.

19

Riverfront Advisors CommissionSchedule 6 - Parking Calculation

Riverfront Development Area

# SpacesBelow Above Podium

Block # Surface Podium Public Dedicated(2) TotalCentral Riverfront Area 1 & 5 892 240 1,132 2 & 6 834 549 1,383 3 720 720 4 789 520 1,309 9 a.,b.,c. 1,100 1,100 11 100 100 Bengal Stadium Site 464 464 Lytle Garage (1) 1,080 1,080 Crosset Site & Adjacent lot 1,300 1,300 Subtotal 1,400 4,799 1,080 1,309 8,588 Third Street Area Third & Race/McAlpins Site 852 852

Queen City Square 900 900 Subtotal - - 1,752 - 1,752 Total Parking Spaces 1,400 4,799 2,832 1,309 10,340

Summary:

1,309 Spaces required for commercial and residential development. (3)8,500 Spaces required for Reds and Bengals.

(1,100) Spaces that may be shared by Reds and Bengals.8,709 Minimum total spaces required in Riverfront Development Area.

Notes:(1) Assumes Lytle Garage increased by one story.(2) Spaces to be built as part of private development projects.(3) See Schedule 3 for calculation.(4) Additional dedicated parking spaces would be built in these projects providing up to 2,598 spaces for office use in the CBD.

20

Public Infrastructure and Amenities Costs and Current Sources of Funding �� Public investment in the Riverfront area is significant. Approximately $1.27 billion is

required to construct all of the infrastructure and amenities (including the Stadiums and the Freedom Center) per the original Riverfront plan. (See Schedule 10).

�� The Advisors Riverfront program estimates that $98 million in public infrastructure and

amenities needs to be spent to implement its recommended development program. �� Of this $98 million, $46 million to build the street grid in the Central Riverfront Area was

originally anticipated by the City and County. The Riverfront Advisors Commission’s plan recommends an additional expenditure of $52 million to create pedestrian plazas covering Fort Washington Way, create a major new anchor – the Boardwalk at the Banks – and create additional green spaces. These amenities will help attract and maximize quality development within the entire RDA.

The Advisor’s have identified several approaches for funding these costs, which could be implemented by a pooling of City, County, and private resources. Approaches to Funding Public Infrastructure Costs to Achieve Maximum Return To fund the expenditures identified above, more leverage from the public’s investment must be achieved and currently identified sources of funding must be maximized to obtain the desired result. Some approaches for accomplishing this may include the following: Developer Contribution to Land Cost �� ERA has estimated that the economics of the recommended development program for the

Central Riverfront Area can support a total of $6.0 million in land residual value. (See Schedule 11). This means that based on the costs and potential revenues from the development projects, the developer can afford to pay the equivalent of $6.0 million present value in the form of future land lease payments and still receive the required return on investment. Current projections provided by ERA assume that the developer pays for the cost of any required dedicated structured parking as well as the development podium. This will certainly be an area of significant negotiation between the developer and the City. Particularly in Phase I of the development where the risk is the greatest, the developer may insist on receiving land at little to no cost. It will be difficult to stretch this potential source beyond the amounts identified. This issue is subject to further review by this Commission or its successor.

21

Riverfront Advisors CommissionSchedule 7 - Supportable Bonded Debt

by Block

Central SupportableRiverfront Bonded

Area Debt % of TotalBlock 1 6,307,000$ 18%Block 2 8,290,000 23%Block 5 1,461,000 4%Block 6 3,094,000 9%Block 10 1,121,000 3%Block 12 1,699,000 5%Block 4 10,832,000 30%Block 8 3,128,000 9%Total 35,932,000$ 100%

Block 118%

Block 223%

Block 54%

Block 69%

Block 103%

Block 12 5%

Block 429%

Block 89%

22

�� If the County garages currently planned for Blocks 1 and 4 are built, there will be a negative impact on this source of funding. First, the general loss of development flexibility caused by the fact that these garages will be designed and built before the blocks are available for development are likely to reduce land values in the Central Riverfront Area. In addition, the Riverfront Advisors Commission’s recommended program would have to be reduced by as much as 291,600 square feet causing a direct negative impact of $1.3 million.

TIF Proceeds from Projects in Central Riverfront Area �� Tax Increment Financing is an important tool that the City has to fund public improvement

costs relating to a particular development project. As Schedule 12 indicates, the Riverfront Advisors Commission’s program for the Central Riverfront Area has the potential to provide tax revenue (after School Board share) that supports $35.9 million in bond debt that can be used to fund infrastructure costs. The calculation assumptions were developed by ERA and are shown in Schedule 13.

�� This source of funding will also be impacted by whether or not the County garages on

Blocks 1 and 4 are relocated to Third Street. The 291,600 square foot loss of development space will reduce TIF proceeds in the Central Riverfront Area from $35.9 million under the Riverfront Advisors Commission’s recommended program to $28.4 million.

County Sales Tax �� The Hamilton County sales tax provides a truly significant revenue stream that could be

used to partially fund the identified gap between sources and uses of infrastructure costs of the RDA, all of which support the stadiums and their public access.

�� The bonds that are funding the construction of the stadiums and the parking facilities were

underwritten and the financial model was projected using a 2% assumption regarding the growth rate of sales tax revenues. The County now anticipates that it will need to use all tax revenues up to a 3% growth rate to cover all of its costs and retire its debt according to schedule.

�� According to sales tax history figures from 1970 to 1998 provided by the County, the actual

average sales tax increase has been 7.55% per year. The 10-year average annual growth rate between 1989 and 1998 has been 4.98% and the 5-year average between 1994 and 1998 has been 5.79%.

23

�� If the conservative assumption is made that tax revenues will continue to increase at a 5% (or even a 4%) growth rate, there will be a significant amount of sales tax revenues in excess of those required to pay the bond debt service and stadium-related operating expenses. These unobligated funds could be used to generate additional funding for Riverfront infrastructure and improvements to support the stadiums and their public access. (Please note that our projections assume that the County retain all of the sales tax revenue until 2003).

�� Schedule 14 shows the present value of the unobligated sales tax revenues at 3.5%, 3.75%

and 4% (versus the five year historical average of 5.79%) growth rates over the next 25 years. These figures represent the difference between tax revenues at a 3% growth rate, which will be used by the County to fund its existing obligations and sales tax revenues at 3.5%, 3.75%, and 4% growth rates respectively. Using these very conservative growth rate assumptions it appears as though a bond issue paying between 7% and 8% interest could be supported in an amount to fund between $44 and $108 million. The Riverfront Advisors Commission recommends that a small portion of this unobligated capacity be used to pay for the remaining identified infrastructure costs after the TIF funding tools and developer land cost contribution identified above are utilized.

�� The Riverfront Advisors Commission recommends that a subordinate bond issue be

privately placed with local lending institutions to cover the gap infrastructure funding requirements for RDA improvements. This amount varies depending on final underwriting costs, financing terms, and the amount required to fund this gap. These bonds would be fully subordinate to all primary County financing for the Riverfront. This will require more detailed discussions and analysis by the County, its bond counsel, and public finance consultant, PFM.

TIF from County Garages �� County-owned parking facilities could generate TIF revenues if the County elects not to ask

for tax exemption. ERA estimates the TIF potential capital funding of the County-owned parking garages to be approximately $22.5 million. We understand, however, that the County and City are moving forward on a request for tax exemption. Therefore, this potential source was not quantified within our recommendation package.

Other Regional Taxes

Regional tax initiatives have played an important role in large-scale private/public development projects in other cities. In Dayton, for example, suburban communities contributed funds on a per capita basis to help fund downtown Riverfront improvements. In Kansas City and Cleveland, special tax levies were approved for special projects to provide public infrastructure, and cultural attractions. Although these taxes are difficult to get approved and in our region’s case, involve many political jurisdictions, they should be considered as a long- term tool for the ongoing revitalization of the region’s urban core on both sides of the river. For example, a regional park tax may be a solution more apt to draw regional consensus for funding the Riverfront Park component of the Riverfront development project.

24

Inclusion of Third Street Development Projects in Riverfront “TIF District” �� The current approach to funding the public infrastructure costs is to capture only those TIF

revenues from projects in the primary Riverfront developments. As discussed above, projects support bond debt of $35.9 million. If the significant public investment in the Central Riverfront Area is viewed as the catalyst necessary to increase property values and creates development opportunities in surrounding areas, then it makes sense that those projects be considered as a source of funding for infrastructure costs relating to Riverfront developments.

�� As Schedule 12 indicates, the Third Street area has significant development potential. In

the three major and two minor projects currently in various stages of active planning, there is a total of 2,175,000 square feet (primarily office) of product. Longer term, the Provident Block and the Marina development could add another 1,200,000 square feet.

�� The potential of the Third Street Development Area could be a significant opportunity to

address some major issues:

1. The above-ground parking garages which limit development flexibility in Blocks 1 and 4 in the Primary Riverfront Area.

2. The gap between infrastructure costs and TIF revenue sources of funding those costs. 3. Obtaining a greater economic development impact from the same dollars invested in the

Riverfront. �� The following scenario should be implemented to maximize leverage of public investment in

the Riverfront:

1. Shift a portion of the Riverfront development parking requirements to projects north of Third Street, thus eliminating the need to construct the above-ground parking garages on Blocks 1 and 4.

2. Reallocate County funds earmarked for these garages (estimated at approximately $17

million) to those projects to provide the developer with a portion of the subsidy required to implement these projects.

3. Use the portion of the TIF from these projects not required for developer subsidy to fund

the gap in the Riverfront infrastructure costs.

25

�� According to the City’s Economic Development Department, most downtown projects currently require 100% of TIF funds to subsidize the cost of new development under current market rent conditions. If County-funded parking garages are substituted for TIF fund subsidy, then at least a portion of the TIF potential from these projects could be allocated to fund Riverfront infrastructure costs.

�� Initially, it may not be possible to capture any TIF revenues from the Third Street projects

since significant subsidy may be required to stimulate investment in these projects. �� It is very likely, however, that the quality Riverfront development environment created by the

Riverfront park and open spaces within the Central Riverfront Area will significantly increase the rents and values of the adjacent Third Street properties. This impact has been documented in many other cities including Atlanta (Centennial Park), New York (Union Square), and Boston (Post Office Square). A likely result is that as rents and values increase, there will be less need for developer subsidy to stimulate new commercial development in the Third Street area. Over time, these projects as well as the longer term projects identified in this report may have the potential to generate significant excess TIF revenues for public improvements. If 25% of TIF revenues were captured from the Third Street Development Area projects, then a conservative estimate is that about $14.4 million would be generated in TIF bond proceeds not even considering the impact of the longer term projects.

Summary of Funding Solutions �� A summary of the Riverfront Advisors Commission’s approach to funding the public

infrastructure is shown in Schedule 15. In Scenario 1 (Current Program), which assumes that the County above-ground parking garages remain on Blocks 1 and 4, the $98 million in infrastructure costs can be funded with $4.8 million in developer contribution to land cost, $28.4 million in TIF proceeds from projects in the Central Riverfront Area, and a $64.8 million subordinate bond issue secured by unobligated sales tax revenues.

�� In Scenario 2 (RAC recommended program), which involves moving the two above-ground

garages to projects on Third Street, the infrastructure costs can be covered by the same combination of sources detailed above even if no TIF funds are “captured” from the Third Street projects. However, the potential exists to generate significant additional funds (estimated up to $28.8 million) if just a portion of TIF funds (from projects actually in planning at present) can be used to fund other improvements, i.e., the Riverfront park or be used to reduce the amount of the subordinate bond issue required to cover the gap between unfunded Riverfront development costs and currently identified potential funding sources.

26


Public Infrastructure Costs v. Private Investment

Public Infrastructure CostsRelated to Private Development

Item AmountStreet Grid 46,000,000$ Utilities 14,555,000$ All Parking incl. Stadium 135,353,000$ FWW Covers 39,000,000$ Boardwalk 8,000,000$ Public Spaces 5,000,000$ Total 247,908,000$

If Garages Remain on Blocks 1 & 4:Private Investment - Central Riverfront Area Only 159,074,000$ Public Investment/Private Investment 64%

If Garages Moved to Third Street:Private Investment - Total RDA 600,446,000$ Public Investment/Private Investment 242%

$0

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Public Investment Private Investment -CRA

Private Investment -RDA

Public Investment 247,908,000$ Private Investment - CRA 159,074,000$ Private Investment - RDA 600,446,000$

27


Calculation of Cost/Value of Private Investment

Total Cost per TotalSquare Feet Square Foot Investment

Central Riverfront Area Phase I Retail/Entertainment 236,500 190.00$ 44,935,000$ Residential 492,000 120.00$ 59,040,000 Office 126,000 150.00$ 18,900,000 Subtotal 854,500 122,875,000$

Phase II Retail/Entertainment 56,900 190.00$ 10,811,000$ Residential 258,000 120.00$ 30,960,000 Office 50,000 150.00$ 7,500,000 Hotel 180,000 160.00$ 28,800,000 Subtotal 544,900 78,071,000$

Total Central Riverfront Area 1,399,400 143.59$ 200,946,000$

Third Street Area Projects in Development Retail 200,000 190.00$ 38,000,000$ Residential 400,000 120.00$ 48,000,000 Office 1,575,000 150.00$ 236,250,000 Parking @ 5,150 2,060,000 37.50$ 77,250,000 Total Third Street Area 4,235,000 399,500,000$

Total Third Street & CRA 5,634,400 600,446,000$

Potential Long Term Projects Retail 120,000 190.00$ 22,800,000$ Office 880,000 150.00$ 132,000,000 Residential (Marina) 200,000 120.00$ 24,000,000 Total Potential L.T. Projects 1,200,000 178,800,000$

Total RDA 6,834,400 779,246,000$

Notes:(1) Keeping garages on Blocks 1&4 reduces developable square footage by

291,600 square feet. This reduces private investment in CRA by $41,872,000

28

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33

Other Economic Impacts of Riverfront Development �� It is important to note that there are significant economic benefits from the proposed

development program other than TIF funding capacity. Schedule 16 summarizes the other economic benefits that the Riverfront Development Area will provide to the region in terms of new jobs, residents, payroll, retail sales, City income tax, and County sales tax. These impacts are significant particularly when the Third Street Development Area is included in the analysis.

�� Therefore, The Riverfront Advisors Commission concludes that it is well worth the

risk to make an investment that is sufficient to ensure that quality, long-term financially successful development will serve as a catalyst to enhance sustainable development throughout the entire urban core.

Summary and Conclusions Solving the infrastructure costs and parking dilemma is an extremely difficult and complex task. It appears, however, that the resources are available if they can be used to their maximum potential. We believe that it is imperative for the long-term financial success of the Riverfront development that: �� Creative and complex solutions identified herein are required and should be implemented. �� Additional short-term investment is required to yield the desired long-term result. It would

be a big mistake limit the region’s most significant economic development opportunity by actions motivated only by solving short-term problems.

�� The various public and private entities involved in this development must pool their

resources and work together to accomplish the overall objective. Not the stadiums, the Freedom Center, nor the commercial development components by themselves will revitalize our region’s urban core. Only together do they form the critical mass required to reverse past trends and shape a new future for our region.

34


Infrastructure Financing Concept Plan

Recommendation: The City, County and private sector should collaborate to fund the public infrastructure and

amenities required to attract and support private development. This would include:

A. Developer contribution to land cost (land lease payments)B. Tax Increment Financing from the CityC. Allocation of a small portion of unobligated growth generated County sales tax revenuesD. Subordinate bonds purchased by private financial institutions

Original (RAC Recommended Program)

Program Move Garages to Third StreetKeep Garages Scenario A Scenario B Scenario C

on 0% 25% 50%Blocks 1 & 4 TIF "Capture" TIF "Capture" TIF "Capture"

Unfunded Riverfront Development Costs (1) (98,000,000)$ (98,000,000)$ (98,000,000)$ (98,000,000)$

Less: Potential Sources 1. Developer contribution to land cost (2) 4,761,000$ 6,014,000$ 6,014,000$ 6,014,000$ 2. TIF Proceeds (Central Riverfront Area) (3) 28,442,000 35,932,000 35,932,000 35,932,000 3. TIF Proceeds (Third Street Area) (4) - 14,405,500 28,811,000Subtotal 33,203,000$ 41,946,000$ 56,351,500$ 70,757,000$

Resulting (Gap)/Excess (64,797,000)$ (56,054,000)$ (41,648,500)$ (27,243,000)$

4. Sale of Subordinate Bonds Paying 7.5% Interest 64,797,000$ 56,054,000$ 41,648,500$ 27,243,000$ (Amount Required to Breakeven)

Revised (Gap)/Surplus -$ -$ -$ -$

Notes:(1) Includes: Street grid 46,000,000$ Coverings and plantings over FWW 39,000,000$ Boardwalk 8,000,000$ Public green spaces 5,000,000$ Total 98,000,000$

(2) See Schedule 11 (3) See Schedule 12(4) Even if 100% of TIF proceeds are required to subsidize Third Street developments, it is likely that reallocating $17 million in County garage funding to parking in Third Street developments will free up a like amount to pay for Riverfront infrastructure.

35

Riverfront Advisors Commission

Schedule 16 Economic Impact of Riverfront Development Plan

CentralRiverfront Third Street Total

Economic Impacts Area Area RDATotal Private Square Feet Developed (1) 1,399,400 4,235,000 5,634,400 Total Cost/Value of Development Projects 200,946,000$ 399,500,000$ 600,446,000$

Total Jobs 1,336 6,700 8,036 Total Residents 1,084 680 1,764

Net New Jobs 801 4,020 4,821 Net New Residents 122 77 199 New Payroll Impact 27,037,000$ 144,819,000$ 171,856,000$ Net Annual City Income tax 451,000$ 2,417,000$ 2,868,000$

Net New Retail Sales 19,759,000$ 13,947,000$ 33,706,000$ Total Hamilton County Retail Sales Tax 198,000$ 139,000$ 337,000$

Total Fiscal Impact 649,000$ 2,556,000$ 3,205,000$ 20 Year Present Value of Revenue 7,444,000$ 29,317,000$ 36,761,000$

Notes:(1) Includes square footage of parking included in Third Street Area projects.(2) Source of figures is ERA. This is a conservative estimate due to the fact that ERA’s figures are based on slightly lower square footages for the Central Riverfront Area than the latest RAC program indicates.

Costs Per Original PlanStreet Grid 46Utilities 15Parking 135Riverfront Park 65FWW Reconfiguartion 282Reds Stadium 235Bengals Stadium 403Freedom Center 90Subtotal 1271

Additional Costs per Advisors PlanCoverings & Plantings over FWW 39Boardwalk Construction 8Public Green Spaces 5Subtotal 52Total Public Investment in Riverfront 1323

($millions)Public Investment in Riverfront Investment Area

Schedule 17Riverfront Advisors Comission

36

Exhibit A: Riverfront Housing Program Based on Availability in the Year 2003 Preface: The following in a preliminary housing program proposal based on approximately 688,000 square feet of housing in two phases. The purpose of this analysis is to show what is possible based on current and likely housing market conditions over the next several years. The suggested mix between ownership and renting, rental rates, unit prices and sizes will need to be continually reevaluated in line with changing market conditions, interest rates, and competition. Absorption will occur over three to seven years. Introduction: Housing is the anchor of the overall development plan for the riverfront Banks. Various sizes, amenity and rent levels are contemplated serving a myriad of life styles from the late-night-party type to the in-bed-by-9 p.m. type. There is capacity for approximately 688,000 square feet of housing within the riverfront area. This figure could be expanded or contracted to the extent that less than capacity retail or office development occurs or if some of the currently planned above surface parking is relocated to northern sites. Housing supports permanent retail and provides a true 24 hours city, unlike sporting event fans, and is thus the most important element of new private market development along the riverfront. Housing, office and retail use may be mixed and there is no reason to preclude European style housing above retail or American style projects that mix office and housing units together. Innovative designs might allow for the same units to become a small office next to or within a housing unit and allow the market to determine the ultimate mix of housing and smaller scaled office use. The potential market for housing will be expanded to the extent that the telecommuter and globe- trotting worker can be accommodated. We do know that low quality urban schools limits the demand to the young urban professional and the empty nesters at the high end. We also know that designated parking is critical for this market at two spaces per unit allocated for high-end housing and one space per unit for moderate and lower-end housing. But, there is no doubt that more potential demand exists for downtown housing than will likely be supplied by all the pending or proposed developments. One Single Housing Developer is Key to Minimizing the Need for Subsidies: It is possible that a well conceived housing program would require little or no subsidy. This is the conclusion of Patrick Phillips from ERA, a consulting resource noted below. If a single housing developer is selected there will be sufficient profit margin on the upscale housing and high quality units to offset the lower profit margins for the smaller affordable units. A single developer can also coordinate and react to changing market conditions, modify the mix of planned rental and for-sale units over time and manage a focused marketing program much better than multiple developers. The current proposal anticipates indirect local subsidy via reduced site costs, as well as taking advantage of a number of locally available housing programs (CRA loans, first time home buyer programs, etc.) but no rental subsidies. Parking and Developer Pad Costs: Dedicated parking is critical for the residential market. Parking must be close, safe, well lit and available 24 hours per day. Drop off delivery locations for groceries, dry cleaning, and other services must be planned into every phase of the housing program. Parking costs are a concern and the one place where some subsidy might be required is some form of reduced parking costs for residents. The marketability of the units depends on the total cost of both parking, unit rent and other fees, and the higher parking costs run the lower the unit rents must be in order to remain marketable. It is anticipated that the housing developer could contribute $5,000 to $10,000 per housing unit, depending on size and price, with an average of $7,500. One option to reduce resident parking costs is to apply these funds to the reduction in parking fees. Other options are to consider using some of the housing TIF money to reduce parking costs to the residents, based on some formula that directs money to the garage operator. Other options are certainly possible, but high parking costs could stifle housing demand.

37

Preliminary Unit Types and Initial Owner/Rental Mix: Renters are easier to find and absorb any given number of housing units more quickly than owners. At the same time, per square foot investment values for rental units are lower than those prices per square foot possible from owners. For this reason, an economically successful program will need to maximize the percentage of owned units. Yet, to start with too many owned units that take a long time to sell could result in a negative stigma similar to the problems incurred at Adams Landing just east of the downtown along the river. Thus, a strategy that starts with a less optimistic number of for-sale housing makes sense, while recognizing the benefits of converting some units from rentals to ownership units over time. The key constraint to developing rentals that become owned units are to meet the higher level of building codes necessary for any units that might eventually become owned. With respect to the renter mix, only the studio/efficiencies are contemplated as 100% longer term rental units, while at the other extreme all of the Penthouses are contemplated as owned units. Note that the suggested sizes shown here are only averages. Rental units’ size will probably be near the base case or slightly smaller and the owner units should run at or above the base case as shown below. That is, the sizes shown for cases A and B seem to work well for the rental market and the sizes shown in B and C work well for the owner market. The following table shows the unit types and ownership percent anticipated in the initial program plan. However, this mix is shown for illustration only recognizing that developers will want to tweak the mix and designs based on their own research and the input of local experts.

Unit Type Percentage of Square Foot Total

Size Range Percent Owner Occupied

Studio/Efficiency 15% 510 to 650 0% One Bedroom 25% 750 to 1000 25% One Bedroom with Den and 1/bath or Two Bedroom units with 2 baths

45% 1000 to 1250 50%

Three Bedroom 10% 1250 to 1750 75% Penthouses 5% 2500 to 3000 100%

Unit Sizes, Rents, Pricing and Household Affordability Based on Forecasts for the Year 2003 There appears to be demand for several size ranges starting at about 500 square feet up to 3,000 square feet. Rents in the $1.10 to $1.40 per square foot range are supportable with condominium prices in the $180/square foot plus range. Keep in mind that these rents will not begin until 2003. Affordable housing can be achieved by including some smaller than average units in the mix, including some smaller no-frill two bedroom units. Three ranges of programs are shown below with Plan B as the base case. In the base case the average unit size is 1,089 square feet and there are a total of 632 housing units. In Plan A, the average unit size is smaller at 879 square feet and the total number of units is increased to 783 units. In Plan C the average of all units is 1151 square feet and there are 598 total units. Key assumptions include: Rents are $1.30 per square foot for studios, $1.15 for one and two bedroom units, and $1.10 for three bedroom units. For owner occupied units a 7.5% mortgage rate is assumed with loan to value assumptions at 90% for one bedroom units, 80% for two bedroom units, 70% for three bedroom units and 50% for the Penthouses. One dedicated parking space is provided per unit with additional units available at market rates. The condominium owners would also need to pay monthly association fees for various management/maintenance service

38

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77

Appendix VI: Report Prepared by Economics Research Associates (ERA)Introduction and Summary of Findings

The Riverfront Advisors, an ad hoc committeeof Cincinnati’s civic and business leaders,was formed in early 1999 to address the

future redevelopment potential of the city’s CentralRiverfront. The study area is generally the landbetween the new NFL stadium, now underway,and the proposed baseball park. The area isbounded on the north by Third Street. Currentplans call for the extension of the city’s street gridsouth of Fort Washington Way, thereby creating aseries of developable city blocks. Importantly,these blocks will sit atop a reservoir of below-grade parking spaces developed primarily to sup-port the sporting events, but also available for day-to-day public parking for users of the CBD and theriverfront. A major public park is proposed for theland between this development area and theshoreline of the Ohio River.

For the purposes of the current work, the Advisorshave assumed that the public sector would createthe conditions required to attract private invest-ment and development. This would include devel-opment of the underground parking, the streetgrid and related improvements, the park, utilitiesand infrastructure, and the platform or podiumupon which private development would takeplace. Private developer(s) would then be recruit-ed to finance, build, and market appropriate pro-jects. Implicit in this approach is that the riverfrontwould seek to balance the amount of requiredpublic investment with the corresponding magni-tude and benefits of private investment.

The Riverfront Advisors retained EconomicsResearch Associates (ERA) as part of a consultingteam to assist in their analysis and planning forriverfront redevelopment. ERA provided adviceand assistance on matters related to market sup-port for various uses, the experience of othercities, and redevelopment economics. This reportsummarizes ERA’s investigation of potential financ-ing mechanisms that could be employed at theriverfront.

The major financing question addressed by thisreport is how to provide the capital funding forthe public improvements required to attract sus-tainable private investment. The Advisors askedERA to consider four principal financing tools:

� Tax-increment financing (TIF)� Regional taxes (e.g. sales taxes)� Intergovernmental funding� Land sale or land lease revenues

In addition, ERA was asked to consider otherpotential sources of funds that are more applicableto longer-term operations and management. Theseinclude creation of a special improvement district(SID) or expansion of the existing SID to incorpo-rate the waterfront, and a system of fees related tothe use of the park for festivals and events.

This report covers each of these approaches, usinga combination of economic analysis and casestudy research. Importantly, all projections present-ed in this report are based on very preliminaryassessments of market and economic conditions,and on tax rates and other factors that are likely tochange. While the methodologies and analyticalapproaches used in this report are appropriate,and the factors used are reasonable, adjustments toany of the assumptions may produce distinctly dif-ferent results.

Summary of Key Findings�We believe that the public investment in trans-

portation improvements, sports facilities, parks,and other infrastructure and amenities will fun-damentally change the nature of regional devel-opment markets. Based on the experience ofother cities, and on local market indicators, as aresult of the riverfront improvements, downtownCincinnati will become much more competitiveas a location for housing, stores and restaurants,offices, and hotel rooms. Fully leveraging thisopportunity—and its commensurate economicbenefits—will require a well-conceived overallmaster plan and top-level execution, includingsome increment of additional public investmentto create the conditions to foster major privatedevelopment.

�The riverfront is well-suited for the use of tax-increment financing. ERA estimates that a devel-opment program in the primary riverfront areaencompassing about 1.4 million square feet willproduce at buildout annual TIF revenues ofabout $3.1 million. Using assumptions for bondunderwriting provided by the City of Cincinnati,this revenue stream could support some $36 mil-lion in bonded debt.

�Other projects along Third Street will clearly beenhanced by the public improvements to theriverfront. Without the riverfront improvements,this development in our opinion would be farless likely to locate in downtown, or even in theCity of Cincinnati. Taken together these projectscould produce an additional increment of TIFrevenue, estimated to total about $5.0 millionannually. Translated to supportable bondeddebt, this development could provide TIF-backed capital funding of about $57.6 million.

�The County owned parking facilities at the river-front are also currently slated to pay propertytaxes. The County is expected to request and begranted a waiver of this tax obligation. However,if this increment of revenue could be made partof a TIF or TIF-like arrangement, it would totalabout $1.96 million annually, or if converted tobonded debt, about $22.5 million.

�Based on the experience of other cities, howev-er, it is clear that regional tax initiatives haveplayed an important role in large-scale public-private development projects. Hamilton Countytaxes will certainly play an important role in thecreation of parking facilities at the riverfront andmay produce sufficient revenue to offset othercosts as well.

�Regional taxes are powerful funding toolsbecause of the broad base of revenues they tap.However, they are equally difficult to getapproved: the broad funding base requires astrong regional consensus in favor of the project.

�Under the current assumptions regarding operat-ing performance and costs, the total develop-ment program produces a supportable capital-ized land value of about $6.7 million. Based ona total gross floor area of 1.4 million square feet,this translates to about $4.80 per square foot.This value could be realized through land leasepayments on those uses most capable of sup-porting such a cost. This preliminary analysisshows office, hotel, and for-sale housing mostcapable of supporting land lease payments.Overall, however, the analysis shows that theprivate uses are likely to make a fairly modestcontribution to the capital funding requirementsof the central riverfront.


78

�The location and timing of parking facilities atthe riverfront could dramatically affect the feasi-bility of new development, both in the riverfrontdistrict and potentially along Third Street. Above-grade parking facilities are currently proposedon several key blocks in the riverfront.Designing and building these in advance ofdetailed development proposals, as is currentlyplanned, could significantly restrict the designand development options on these blocks. Ifsome of this parking, which is required to servethe sports facilities, could be relocated, therecould be several benefits: additional FAR, per-haps as much as 250,000 square feet, could beproduced in the riverfront area; this would helpprovide the kind of critical mass needed to sus-tain the neighborhood, would increase the residual land value, increase potential TIF rev-enue, and substantially enhance the feasibility ofnear-term development prospects in the ThirdStreet area.

�At buildout, the Primary Riverfront Program willcreate an estimated 1,507 total jobs and 1,084residents, of which 904 jobs and 122 residentswill be new to the city. These "net new" jobssupport an annual payroll of $27 million. Shortand long-term additional developments alongThird Street will support an additional 6,700 jobsand 680 residents.

� Including both indirect and induced impacts, itwould be reasonable to expect the public invest-ment in the riverfront to ultimately produce atotal regional economic impact of over 17,000new jobs and new annual income of over $600million.

�Additional annual City revenues from employ-ment-related taxes of the Primary Program areestimated at $510,000. County revenues from theproject’s $46.5 million in annual retail sales willtotal about $206,000. The additional City revenuefrom Third Street development is estimated at$2.4 million, while the County’s revenues willinclude an additional $139,000. Total net-new,annual fiscal benefits from the riverfront-relatedpublic investment is therefore estimated at over$3.3 million.

�The Advisors also asked ERA to evaluate thepotential for user fees and the SpecialImprovement District mechanism to help pay forriverfront development. While we agree thatthese will be useful approaches for fundinglong-term operations and management, they areless relevant for capital funding purposes.

�A SID will be an appropriate mechanism for theriverfront. The question of whether or not thecurrent SID structure should simply be expand-ed to cover the riverfront will ultimately beaddressed, but is less important in the currentstage of planning. There will be certaineconomies of scale if the boundaries areexpanded. The governance structure wouldprobably need adjustment to reflect the slightlydifferent constituency and land use mix on theriverfront. It is likely appropriate that this issuebe considered as part of the expected reautho-rization of the SID in 2002.

� In addition to the quantitative benefits, theRiverfront project will provide substantial qualita-tive benefits to the city, county, and region. Weexpect that the project will significantly enhancethe visitor experience and thus the overall mar-ketability of the City and region. This willencourage more visitors to come, to stay longer,and to spend more. It will also positively impactthe ability to market meetings and conventions,which is an important source of real economicgrowth for the region. An improved riverfrontwill provide a quality-of-life enhancement that isattractive to potential new residents and busi-nesses, and will reinforce the ability of theregion to attract and retain new households and workers.


www.riverfrontplanning.org

September 30, 1999

T h e R e p o r t o f t h eR i v e r f r o n t A d v i s o r s C o m m i s s i o n


◆

— The Vision for The Banks —

The Banks is the shining centerpieceof our region, reflecting excitement,energy, a new sense of pride and

renewed connection with our River. It is a place people call home. It is aplace where people work and shop

and party and visit. It is a place wherepeople cheer the home team, celebratefreedom, and honor our rich diversity.It is a place for playful enjoyment andquiet reflection. It is a place for every-

one, citizen and visitor alike. It is aplace to come to again and again. It is an engine to drive economic

growth and new vitality in Cincinnati,Northern Kentucky, and our entireregion. It is a place that links us

together. It is a new spirit of coopera-tion. It is an experience that elevatesour city to true world-class status. It is

our potential. It is our future.

What Do We Call It?Early on, we realized the Riverfront developmentneeded a name. Cleveland has The Flats, Baltimorehas Inner Harbor, Denver has LoDo, San Antoniohas Riverwalk. Cincinnati will have The Banks. Thename is simple, direct, and easy to say. It is authen-tic, not gimmicky. It has energy and crispness, asense of place, and it connects the region to theRiver. It fits.

◆Letter from Jack Rouse

On September 30, 1999 the Riverfront AdvisorsCommission presented to the City/CountyRiverfront Steering Committee a program for

Riverfront development. The Advisors were appointedby the Steering Committee in February 1999 to “recom-mend mixed usage for the Riverfront that guaranteespublic investment will create sustainable development

on the site most valuedby our community.”

At the outset, we rec-ognized this is a defin-ing moment for ourcommunity. It is aonce-in-many-lifetimesopportunity to recreateour extraordinaryRiverfront as a magicalcenterpiece for ourregion, a new “frontdoor” for our city, anew hub of activity, aplace that connects

people of all backgrounds, whether neighbors or visi-tors. With that vision in mind, we have developed thisplan for a new urban neighborhood, The Banks.

We are convinced that with the courage, leadershipand commitment of public officials, the excitementand support of the community, and the creation of atrue public-private partnership, we can indeed seizethis unique opportunity.

As Chair of the Riverfront Advisors Commission, I wantto thank the others who serve with me. I also want tothank the Steering Committee for their support andencouragement, and all the major Riverfront stakehold-ers and interested organizations who have participatedwith us in creating this plan. I especially want to thankthe hundreds and hundreds of concerned citizens whotook the time to attend forums, write letters, preparedesigns, send e-mails, make phone calls, and holdmeetings with us. Their concern, and their belief thatCincinnati can be a world-class city, has inspired us.

We are convinced more than ever that the future ofthe Riverfront – The Banks – must come not frombricks and mortar alone, but from a will as powerfuland flowing as our river, a will to achieve what canbe, what must be. Together, we know we can achieveit. We ask for your support of this plan.

Jack Rouse, ChairRiverfront Advisors Commission


◆Summary of Riverfront AdvisorsCommission Recommendations1. The Banks should create a 24-hour, seven-day-a-week, diverse, pedestrian-friendly urban neigh-borhood with a mix of uses, including residentialhousing, specialty retail stores, restaurants and enter-tainment, office and boutique hotel space.

2. The Banks should fully integrate CentralRiverfront and Third Street development to maxi-mize economic potential, strengthen linkages with theCentral Business District and build the critical massneeded to create a Riverfront destination.

3. The Banks development should be enhancedand better-connected to the Central BusinessDistrict by adding three infrastructure and ameni-ty improvements:◆ Pedestrian plazas covering most of Fort Washington

Way◆ A major new anchor attraction – The Boardwalk at

the Banks – on the west side of the development◆ Exciting, usable green spaces and amenities, particu-

larly in the center of the development.

4. The design of The Banks neighborhood shouldfoster a diverse, welcoming, pedestrian-friendlyurban character and create a striking visual impres-

sion – Cincinnati’spicture postcard tothe world.Architectural guide-lines including build-ing heights, materials,setbacks, signage, useand design should beadopted and codified.

5. The County-funded above-ground parkinggarages currentlyplanned for theCentral RiverfrontArea should be

shifted to sites north of Third Street to stimulateThird Street development and increase overall eco-nomic return. This creates the opportunity to increasetriple the return on public investment. To meet theCounty’s total parking commitments, this plan alsorequires that the Crossett site west of the Paul BrownStadium be used for parking.

6. The City, County and private sector should collab-orate to fund the public infrastructure and amenitiesrequired to attract and support private developmentincluding:◆ Developer land lease payments◆ Tax Increment Financing (TIF) from the City◆ Allocation of a small portion of unobligated County

sales tax revenues◆ Subordinate bonds purchased by private lending insti-

tutions.

7. The City, County and private sector (throughDCI) should jointly create an interim parking andshuttle program to address the near-term shortfall indowntown parking spaces created by moving above-ground parking north of Third Street.

8. The Banks development should stimulate eco-nomic inclusion among all ages, races and gen-ders in all aspects, including design, construction, exe-cution and operation. The Banks EntrepreneurialEquity Fund should be established to advance thisgoal.

9. The Central Riverfront Area should be devel-oped in phases to reflect market demand and stadi-um, Freedom Center and Riverfront Park developmenttimetables, with Phase I completed in 2003 and PhaseII completed in 2006.

10. The City and County should jointly create aRiverfront Development Commission (RDC) tooversee and ensure implementation of The Banksvision.

Find the Advisors’ report atwww.riverfrontplanning.org


Hotel – One or two modestly-sized boutique hotels,built in the later development phase, could be sup-ported primarily from visitors to special events andanchor attractions in The Banks, rather than from con-vention visitors. Nonetheless, Convention Center expan-sion also would strengthen overall downtown hoteldemand and contribute to the vitality of The Banks.

The Advisors’ plan includes sev-eral additional enhancements.

Pedestrian plazas coveringmost of Fort Washington Waywill encourage easy and safepedestrian access to the CBD,better connect destinations with-in the Riverfront development,extend appealing green space,and provide an additional ameni-ty to attract private investment.

The Boardwalk at theBanks will create anadditional anchor attrac-tion at the western endof the development. Itwill provide a pedestrian-friendly destination,including exciting restau-rant and entertainmentvenues.

Additional green spaces and amenities, particularlyin the center of the development, will include land-scaped areas, promenades and art features. They willencourage pedestrian movement within the develop-ment and enhance its overall feel of openness andattractiveness to both visitors and developers.

Recommended Range of Uses

◆Summary of UsesThe Banks includes a mix of uses to create a

diverse 24-hour, seven-day-a-week pedestrian-friendly urban neighborhood. They combine with themajor anchor attractions – Firstar Center, the newReds Ballpark, the planned National UndergroundRailroad Freedom Center and the Paul Brown Stadium– as well as Riverfront Park,strong pedestrian and trans-portation linkages, and over10,000 parking spaces to forman exciting, inviting, economi-cally sustainable developmentand catalyst for future growthfor the entire region.

The development includes theCentral Riverfront Area, andthe Third Street blocks adja-cent to the Central Riverfront. By fully integratingdevelopment in these areas, the program maximizeseconomic potential, linkage with the CentralBusiness District and builds the critical mass need-ed to create a Riverfront destination.

Residential housing is essential to creating a vital 24-hour neighborhood. Buildings, parks, and stadiumsdon’t create vitality; people do. The Banks will includefor-sale and rental properties targeted to empty nestersaged 50-70, as well as rental units for young workingadults in all income ranges, including some units thatare affordable for lower income households.

Retail will include street-level shops, restaurants andentertainment supporting the residential, office, recre-ational and anchor attraction activity at The Banks. Wedon’t envision “big box” retail as part of The Banks;this should be retained and encouraged north of ThirdStreet. Emphasis will be placed on attracting localentrepreneurs and retail with a unique local andregional flavor.

Office space located in the Central Riverfront Areawill be targeted largely to independent professionalsseeking boutique-type office space or who may alsoreside in the development. Major corporate officedevelopment will be located in the Third Street devel-opment area, complementary to the CBD.

Retail & Residential Entertainment Office Hotel

(Units) (000’s sf) (000’s sf) (Rooms)Central Riverfront 600-800 250-300 100-200 200-400Third Street 300-500 150-250 1000-2000 —Total 900-1300 400-550 1100-2200 200-400

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See a video of The Banks at w

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◆ Anchor Attractions1 Paul Brown Stadium2 Freedom Center3 Reds Ballpark4 Firstar Center

◆ Riverfront Advisors’ Recommended Enhancements5 The Boardwalk at the Banks6 Fort Washington Way

Pedestrian Plazas

7 New Greenspace◆ Potential Third Street

Developments8 Former McAlpin’s Site/

3rd & Race (Under Consideration)

9 Queen City Square (Under Consideration)

◆ Riverfront Park10 Riverfront Park

www.riverfrontplanning.org


The Advisors’ plan is projected to generate substantial-ly greater total economic return than the CentralRiverfront-only program. Total annual new revenuegenerated from Cincinnati payroll tax and HamiltonCounty sales tax could increase nearly five-fold. (See“Total Economic Impact” chart on back page.)

The Advisors’ concept for financing involves City,County and privatesector collaborationthrough:

◆ Developer landlease payments

◆ Tax IncrementFinancing (TIF)from the city

◆ Allocation of asmall portion ofunobligatedCounty sales taxrevenues

◆ Subordinatebonds purchasedby private lendinginstitutions

Continued on back page...

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Advisors’Recommended

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$159M

81% ROPI

242% ROPI

$600M

4XPrivate

Investment

$52M$196M$196M


Summary — Economic Development Impact of Advisors’ Plan


Public Street Grid $ 46 Street Grid $ 46 Expenditure in Utilities $ 15 Utilities 15 Central Riverfront Parking $ 135 Parking 135 Area (000’s) Total $ 196 Subtotal $196

FWW Covers/Green Spaces $ 39 Boardwalk at the Banks 8 Public Green Space 5 Subtotal $ 52

Shift parking to Third Street $ 0

Total $ 248

Total PublicInvestment (000’s) $ 196 $ 248

Private Investment(000’s) $ 159 $ 600

Return on PublicInvestment (ROPI) 81% 242%

◆Economic Impacts The Banks development is a powerful economic

catalyst for the entire region. Originally, the devel-opment was focused primarily on the CentralRiverfront Area. The Advisors’ plan integrates CentralRiverfront and Third Street development to substantial-ly increase the overall economic impact.

A key recommendation is to shift County-fundedabove-ground parking garages currently planned forthe Central Riverfront to sites north of Third Street tostimulate Third Street development.

When combined with economic incentives such asTax Increment Financing, public investment in parkingnorth of Third can stimulate or accelerate the develop-ment of several major projects currently under consid-eration including those at Queen City Square, Third &Race, and the former McAlpin’s site. This contributesto a return on public investment three times that of theCentral Riverfront-only plan.

The Advisors’ plan has potential to stimulate about$600 million of private investment, about four timesthe level of the original plan.


Total Economic Impact

Original Plan Advisors’ Plan(Central Riverfront (Central Riverfront

Only) + Third Street)

Total Jobs Created 1,336 8,036Total Residents 1,084 1,746

Total New Jobs Created 923 5,020Total New Payroll Impact (000’s) $27,037 $171,856

New Retail Spending (000’s) $19,759 $ 33,706

Total Annual Fiscal Impacts(ex. property taxes)

◆ Annual City Payroll Tax Income (000’s) $ 451 $ 2,868◆ Annual County Sales Tax Revenue (000’s) $ 198 $ 337

Total Annual Revenue Generated (000’s) $ 649 $ 3,205

20-Year Present Valueof Annual Revenue (000’s) $7,444 $36,761

◆

Economic Impacts, Continued from inside...These overall financing concepts are sound and thebasic assumptions are conservative. These methods areused widely in the private sector and are entirelyappropriate to support public investments.

The program does not involve any new taxes. Further,the Riverfront development will positively impact pub-lic school funding. All TIF calculations provide full taxrevenues to Cincinnati Public Schools (CPS), consistentwith the prior agreement between the City ofCincinnati and CPS.

The Charge to theRiverfront Advisors CommissionThe City of Cincinnati and Hamilton County have collaborated in an unprecedented way by jointlyappointing the Riverfront Advisors Commission inFebruary 1999.

The Steering Committee defined the study area to bebounded by “Fourth Street to the north, the Ohio Riverto the south, I-75 Brent Spence Bridge to the west andL&N Bridge to the east. The southern edge of down-town is included to ensure that the connectionsbetween downtown and the Riverfront are strength-ened and retail development is complementary.”

By September 1999, the Advisors had proposed adevelopment plan, performed feasibility studies,worked to build community consensus, recommendeda financial plan and defined a structure to ensureimplementation. The Advisors will continue to serve toassist in reviewing proposals from developers, select-ing a development team and further building commu-nity support.

Members of the Riverfront Advisors Commission

◆David Anderson, Director,

Civic & Promotional Affairs,Delta Airlines

Clifford A. Bailey, President &CEO, TechSoft Systems

Otto M. Budig, Jr., President, Budco Group

J. Joseph Hale, Jr., President, Cinergy Foundation

Thomas H. Humes, Jr., President,Great Traditions Land &Development Company

Eric H. Kearney, Esq., Attorney, Cohen, Todd, Kite &Stanford, L.L.C.; President &CEO, Sesh Communications

Ronald B. Kull, Associate VicePresident and UniversityArchitect, University of Cincinnati

Laura L. Long, ExecutiveDirector, Cincinnati BusinessCommittee

Steven R. Love, Vice President/General Manager, Blue ChipBroadcasting Company

Norman Miller, Director of RealEstate Program, College ofBusiness Administration,University of Cincinnati

Paul Muller, Principal, Muller &Associates, Architects

Charlotte R. Otto, Global PublicAffairs Officer, The Procter &Gamble Company

Jack Rouse, CEO, Jack RouseAssociates

Jeanne H. Schroer, Senior VicePresident, CorporateDevelopment, Corporex

Nicholas J. Vehr, President,Cincinnati 2012; VicePresident, Dan Pinger PublicRelations, Inc.

Frank Wood, President & CEO, Secret Communications

Find more information atwww.riverfrontplanning.org

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$649

Tax Impact of Riverfront Advisors Plan

Annual FiscalImpact

20 YearPresent Value

The Report of the Riverfront Advisors...

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Transcript of The Report of the Riverfront Advisors...