Sunday, March 16, 2008

Reality Check on the Arcade

The Arcade was in the news last week, as part of a report on Bob Shifflers presentation to the Chamber of Commerce. Shiffer was telling it like it is.

Developer: Arcade development will take collaboration

Shiffler, who has been negotiating to buy the five-building complex, said redevelopment funding would need to include up to $8 million in equity that would provide investors a return. The rest of the costs would need to come from tax credits, loans, tax-increment financing or other tools, he said.

And the community needs to act sooner rather than later to undertake this effort since tight government budgets could eliminate tax credits applicable to the project, he said.

This is a great wake-up call to those that think this project is going to happen via 100% private financing.

And given the problems making Ballpark Village work how likely is a public private partnership? And it seems even small re-use projects like The Merc are beyond local capacity.
The reality is the money just isn’t there for a public-private partnership, which means any re-use of the Arcade is going to be doomed from day one.

I have posted on how Louisville is finding ways around the economic impasse of center city re-use. However this is not a fair comparison as Louisville has these things Dayton lacks:

  • A growing economy (Dayton will be getting that when BRAC effects kick-in)

  • Financial and managerial capacity in local government

  • Leadership in the business and government that prioritizes downtown revival.
The Economist reports on Louisville as one city that is taking the big picture look that is so lacking with local leadership, and this is recieving national attention as a model:

In a forthcoming report for the Brookings Institution, a Washington, DC, think-tank, Carolyn Gatz and Edward Bennett commend it as a model for other recovering cities.

So there are lessons learned, but they are politically unpalatable ones for this community

The DDN Aracde article continues:

Such a redevelopment also would need a reliable, long-term tenant such as a government agency or a law firm to help anchor the project, he said

The public use makes sense, perhaps more for an expansion of Sinclair (WSU already has a downtown facility) than for some local govt. office (government is already in the Riebold Building and other office spaces). The law firm concept does, too, except the city already has a commitment to move a large downtown firm to Ballpark Village. But finding a large office tenant is very unlikely given the trend away from the center city.

1 comment:

Anonymous said...

Louisville made the move to uni-gov. How much more obvious can we get?
Given a choice between ballpark village with carpetbagger developers or the Arcade with our own home-grown Shiffler as the lead- I go with Shiffler. Not only is it a better risk- but, the arcade can't be duplicated, Ballpark village is a cookie cutter clone of the Greene- or will detract rather than enhance existing business.