Downtown Akron Growth Fueled By Tax Credits And Abatements
Downtown Akron is under construction. Its Main Street is a dirt floor.
Akron developer Tony Troppe watches the trucks and bulldozers from his office window in the Everett building at the corner of Main and Market streets.
“The good news is there’s going to be a concentration of a new neighborhood downtown which opens up the door for all types of new development,” he said.
Constructed in 1870 as the Academy of Music, the Everett building was converted into a bank in 1900. Now, with the benefit of a 15-year property tax abatement for residential units, Troppe is turning the building’s 1990s-era offices into 20 apartments plus commercial space.
“Well, here we are in the central atrium of the Everett building,” Troppe said as he gave a tour of the building. “I like to refer to it as the ‘light of the world’ atrium.”
Tony Troppe in the Everett Building [Mark Urycki / ideastream]
This week, the Everett building project received $470,500 in Ohio historic tax credits. Troppe has been using federal and state historic tax credits to turn around old Akron buildings for years.
“Our task here was to unmask that tin roof and open up the skylight system that had originally been there, built in 1904, this section.”
Across the street, Troppe is also using tax credits to convert the 1923 United building into the 71-room Blu-tique hotel to open in the coming year.
“Each building has its own personality, its own flavor, and the locations are key,” Troppe said. “These are great bones that are being brought back to life.”
Beyond Main and Market Streets
A wide range of tax credits is attracting new investment sources and fueling a burst of construction in the city center.
Maybe the most important project in Akron is the $42 million Bowery Project.
The downtown block from the Landmark building at the corner of Main and Bowery to the Akron Civic Theater will be renovated with retail in front and back, along the Ohio Canal. The 12-story Landmark will convert to apartments.
The Development Finance Authority of Summit County took ownership of this block last year and put in money to kick off the development. Authority President Chris Burnham says money from tax credits and abatements is a catalyst that sparks other projects.
“Once someone has done it – like Cleveland has proven this − you kind of need less and less of those non-traditional sources because the market has established itself,” Burnham said.
Summit County Development Finance Authority President Chris Burnham [Mark Urycki / ideastream]
At a recent ground breaking ceremony, the Welty Building Company’s Don Taylor said the Bowery project was years in the making.
“This one is a little more complicated than most,” Taylor said. “We have 15 different sources of income going into our capital stack so it’s had its challenges.”
That stack of capital includes historic tax credits for the renovation of old buildings and federal New Market Tax Credits for investing in economically distressed areas.
“Trying to get all these terms lined up and have everybody coordinated takes a lot of lawyers,” Taylor added.
Welty Building Company President Don Taylor [Mark Urycki / ideastream]
All those tax benefits are attracting regional and national investors outside Akron, says Kevin Brokaw, one of the partners in the Bowery project.
“Getting the investment to come from Washington, from Cleveland, from a group that is expanding its footprint in Northeast Ohio, Cleveland Development Advisors, is absolutely crucial,” Brokaw said. “But really the best part of the story is that there is money coming in from outside of downtown Akron from people who believe in Akron as a community.”
There’s more construction across Main Street at the 11-story Law Building, formerly the Key Building. A New Jersey developer purchased it this year and will convert seven floors into luxury apartments.
Cleveland’s Weston Inc. bought the Citi Center building at High and Bowery from the City of Akron and is planning to turn the former YWCA into offices and apartments.
“And so the idea here is that whether it’s the Law Building across the street, the hotel down the street, or another residential project by even another developer, this should help them prove out concept and get their deal financed,” said Brokaw.
Kevin Brokaw [Mark Urycki / ideastream]
Too Much of a Good Thing?
But if everybody is converting office buildings to apartments, might there be too many? Don Taylor says, it’s building a market.
“And I actually believe the more that’s down here the better it is for all of us,” said Taylor. “So we’re really excited about seeing these other projects get off the ground. We think it will do nothing but enhance our project. The more people we have in downtown Akron the better for the community and the business community.”