State announces $10M tax credit for Nicholas Building renovation
Posted By: The Toledo Blade on December 22, 2023. For more information, please click here to read the source article.
Renovation of downtown Toledo’s historic, but decrepit, Nicholas Building got a $10 million boost Thursday from the Ohio Historic Preservation Tax Credit Program.
The credit awarded to the building on the southwest corner of Huron Street and Madison Avenue — an anchor of downtown Toledo’s Four Corners — is “one of the largest single historic tax credit awards for any project in Ohio history,” the Lucas County Land Bank said in response.
The state also announced reissuance of a credit for the former Burt’s Theater a few blocks away on Jefferson Avenue and a new credit for the former Hoppe & Straub Bottling Co. building at Superior and Lafayette streets. The latter is now home to the Toledo branch of The Spaghetti Warehouse restaurant chain, while the former most recently housed Caesar’s Showbar.
The $67.5 million in total tax credits applicable to 46 projects statewide will involve renovating 54 buildings and induce about $732 million in private investment, Ohio Gov. Mike DeWine’s office said. The three in Toledo were the only ones in northwest Ohio in this round of credits.
The Nicholas and its cross-street neighbor, the Spitzer Building, are slated for renovation by the Lucas County Land Bank. The $10 million tax credit for the Nicholas applies to that building’s estimated $103,289,695 renovation cost.
“We have known from Day One that redevelopment of the Spitzer and Nicholas buildings would be hard, but our community has never shied away from hard work,” Lindsay Webb, the Land Bank’s chairman as well as the Lucas County treasurer, said in a prepared statement. “Today’s announcement is an incredible first step toward funding this project and continuing downtown’s transformation.”
A companion application for the Spitzer Building’s renovation also was submitted in September. The two buildings’ renovation is expected to cost a combined $190 million, with a total of 350 dwellings and over 25,000 square feet of retail and commercial space.
“While the Spitzer Building was not funded in this round, the project team believes it remains very competitive, and its application is expected to be re-submitted in March, 2024,” the Land Bank said.
The agency also has an application for an Ohio Transformational Mixed-Use Development tax credit for the Four Corners project pending with the state. If approved, the project would be the first of its kind in northwest Ohio to receive such a credit.
The Four Corners is so named because it is the only downtown Toledo intersection at which original tall buildings occupy all four corners. But three of the four have been empty for years.
Built in 1906, the Nicholas was occupied by bank headquarters and offices until it lost the last of its occupants in 2006. Its upper floors are to be converted into 193 residential units ranging from studios to three-bedroom apartments.
The same round of credits includes $1,983,670 for Burt’s Theater at 725 Jefferson, where property owner IBC, Inc. expects to spend $10,118,703 to create 15 apartments on upper floors plus a ground-floor restaurant.
It had been selected a year ago for a $908,360 tax credit applicable toward a project cost then estimated at $8.3 million.
It’s the “same exact project as before, but two things changed in the interim: material costs skyrocketed and interest rates doubled,” Joe Marck, IBC’s director of development, said Thursday.
Contractors toured the project in the spring of 2022 to prepare bids, and IBC filed its tax-credit application that summer, he said. But contractors’ revised quotes after the award a year ago were higher by more than the tax-credit award, and that was before rising lending costs were factored in.
“There’s just so much ‘sit and wait’ time in the process, that inflation started going crazy and there was nothing we could do about it,” Mr. Marck said.
IBC is wrapping up work on the former Barber Farris Produce Warehouse at Huron and Market streets, he said. Finalizing plans with architects and engineers and getting city permits for the former Caesar’s should allow work to start there by summer.
The $250,000 tax credit for the former bottling plant at 42 S. Superior St. will allow upper floors at The Spaghetti Warehouse to be renovated into an event center for weddings, parties, and the like and feature a commercial kitchen, bridal suites, ballrooms, and a bar area, the state’s announcement said.
The total project cost there is estimated at $4,435,403.
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