A reworking of the terms of a Community Reinvestment Area agreement will allow the redevelopment of the property at 2015 W. Fifth Ave. in Marble Cliff to proceed.
A reduction in the tax abatement from 100% to 50% has resulted in a shift in F2 Cos.' plans to build 37 apartments at the site.
"Originally, the plan was for apartments for rent; now they will be doing a condominium project," Marble Cliff Mayor Kent Studebaker said.
The 50% tax abatement will be for 15 years for the assessed value of new structures and 12 years for the increased value of the existing property resulting from improvements to the Frank Packard-designed mansion at the site, Studebaker said.
The original CRA called for 100% abatements for the same period of time.
Marble Cliff Village Council approved the revised agreement in November, he said.
Any tax abatement greater than 50% would have required the approval of the Grandview Heights school board, Studebaker said.
The school district offered a counter-proposal for a 55% abatement on both the new structures and improvements, along with a one-time payment of $50,000 to the schools, plus an annual payment of $15,000 for 15 years.
"There was nothing hostile about it," said school board Vice President Melissa Palmisciano, who serves as the board liaison for economic-development issues.
"We were simply looking out for the fiduciary interest of the school district, which is our responsibility," she said.
A CRA is an economic-development tool that provides property-tax exemptions for property owners who renovate or construct new buildings within a designated area.
According to the data provided by school treasurer Beth Collier, the district stood to lose $3 million in property-tax revenue from the two 100% tax abatements, Palmisciano said.
"From the school board's perspective -- I know from my perspective -- a 100% tax abatement was unacceptable," she said. "We had to look at this from the perspective of the impact it would have for us."
The board's counter-proposal was designed to help make up some of the revenue that would have been lost through a 100% abatement, Palmisciano said.
The board did not receive a formal response to its proposal before the revised CRA agreement was completed, she said.
"Our approval is not needed with a 50% abatement," Palmisciano said. "We consider this agreement to be a compromise that we can live with."
The developer has indicated that when the project is complete, the valuation of the property at 2015 W. Fifth Ave. will increase from $500,000 to $10 million, Palmisciano said.
"Long term, it's going to be a benefit financially for the schools," she said.
Although the project, dubbed the Packard at Marble Cliff, is expected to target older adults who do not have school-age children, the district was concerned about a potential indirect impact on its enrollment, Palmisciano said.
Empty nesters who are looking to downsize and remain in the Tri-Village area may move into the new condos, but the concern is that families with children might end up buying and moving into their old homes, she said.
The estimated investment in new buildings, as anticipated by the developer, is $8 million, and the estimated investment in the remodeling of the existing house is $1 million for about 42,500 square feet of space in the various residential units.
F2 Cos. will redevelop the site with 37 condominium units, including three second-floor units in the existing mansion that has been used as office and commercial space for decades.
The first floor of the mansion will include a clubhouse amenity for the development's residents and a guest bedroom for visitors.
A three-bedroom building behind the mansion will have 30 one- and two-bedroom condominium units.
The development also will include three carriage houses, each with a single garden unit.
F2 has indicated it is looking to break ground on the project by spring 2020, Marble Cliff fiscal officer Cindy McKay said.
F2 partner Ted Foster did not respond last week to ThisWeek Tri-Village News' requests for comment.
The West Fifth Avenue project marks the first time the village has implemented a CRA agreement, Studebaker said.
"We established the CRA (in 2008) in Marble Cliff when Exxcel Project Management was proposing to move into the old Custom Coach property at 1400 Dublin Road," he said.
"It would have allowed us to provide them with a tax abatement, but the project never came to fruition."
Exxcel ultimately moved its offices to 328 S. Civic Center Drive in Columbus.
The CRA remained in place, Studebaker said.
The property at 2015 W. Fifth Ave. has been ripe for redevelopment, he said.
"This has been a 10-year process where the property has been one that has been available for sale," Studebaker said. "We have had a number of developers come to us with some preliminary ideas and we've been hoping we'd be able to find someone who could bring this property back to life.
"We have that with this current plan, and we've also been able to preserve the Frank Packard mansion," he said.
F2's original proposal was for 67 apartment units, but both the density and the developer's plan to demolish the mansion met with opposition in the community and among council members.
The developer still will need to present additional architectural details to the village for administrative review, but no further action by council will be needed, McKay said.