GE’s new global HQ seen as ‘true home run for the Banks and the city of Cincinnati’
When General Electric opens the doors to its new Global Operations Center at the Banks, it will mark a new era in the development of Cincinnati’s riverfront.
“The first image you get when you’re first approaching Ohio is the Banks, and you see the GE building,” said Jim Henning, president of Duke Energy’s operations in Ohio and Kentucky as well as the 2016 chairman of REDI Cincinnati. “That gives a special type of feeling.”
A panel of high-powered commercial real estate and development experts this week led a discussion about the region’s largest mixed-use development.
The panelists included Tom Gabelman, a partner with Frost Brown Todd LLC who has been extensively involved with negotiations of various agreements pertaining to the Banks; Dan McCarthy, project executive for master developer Carter; Mark Fallon, senior vice president of real estate at Jeffrey R. Anderson Real Estate and retail leasing agent for the Banks; Mario San Marco, president of Eagle Realty Group, which will own the AC Hotel by Marriott at the Banks, and Henning.
The Banks, when complete, will be home to thousands of residents and office workers, along with a lively retail and entertainment district, bookended by two major league stadiums. The transformation of what has long been a flood zone into the vibrant, mixed-use “front porch” of Cincinnati is one of the most remarkable transitions in the country.
For years, the “mud pit” between Great American Ball Park and Paul Brown Stadium sat undeveloped. For nearly two decades, the Banks has been a work in progress. A Cincinnati Central Riverfront Master Plan was approved in 1997. A public-private partnership was then formed between the city of Cincinnati and Hamilton County in conjunction with the state of Ohio.
The riverfront added Paul Brown Stadium in 2000, Great American Ball Park in 2003 and the National Underground Railroad Freedom Center in 2004. A total of 18 acres remained between the stadiums.
In 2007, Atlanta-based companies Carter & the Dawson Co. were selected in a joint venture for the master development. The Banks team broke ground on phase I in late 2008, just as the Great Recession hit the nation.
Phase I, which includes 300 luxury apartments and 77,000 square feet of retail space, quickly filled.
Phase II of the Banks is wrapping up with the 292-apartment Radius at the Banks open and leasing units. GE’s 338,000-square-foot, $90 million center is scheduled to open in September.
Landing GE at the Banks is one of the biggest economic development wins of all time for the city of Cincinnati. The operations center isn’t expected to be fully staffed until 2018, but already it’s generating a buzz.
“The GE Global Operations Center is a true home run for the Banks and the city of Cincinnati as a whole,” McCarthy said.
The office component is a complementary use for the development, helping to drive activity and vibrancy at the Banks on non-game days.
Originally, GE was projected to bring about 1,800 jobs to the Banks. Now, Gabelman said that projected employment is closer to 2,200 to 2,400 jobs when fully occupied.
Gabelman said the city and the county have come together to invest almost $1.6 billion in the city’s riverfront and will leverage another $1 billion of development.
By 2025, the Banks could have close to 3 million square feet of mixed-use development and $2.7 billion in investment.
“We are moving at a fast pace and we want to maintain that momentum,” Gabelman said.
Phase III A, which could start later this year, will be developed above the under-construction 690-space parking facility, a $29 million public infrastructure investment. The potential private investment above the parking could range between $80 million and $100 million.
The third phase of development at the Banks also has been broken into three phases. Phase III A will cap the current construction of parking decks at the southwest corner of West Freedom Way and Rosa Parks Street. Phase III B will be on the south side of Mehring Way. Phase III C is planned for the parcel between Paul Brown Stadium and Race Street, south of West Freedom Way.
Between the next parts of phase III there is room for about 400,000 square feet of mixed-use development, including Smale Riverfront Park.
McCarthy, who joined Carter in March 2015 to help lead the project, said the developer is focused on phase III as well as the office building planned in the first phase of the Banks.
“We’re incredibly excited about phase III, not just because of the apartments above, but the street-level retail,” McCarthy said.
This phase will include apartments, an extension of ground-level retail and additional secured parking for residents. The entertainment district will eventually stretch from stadium to stadium. Carter wants to start construction on the next phase as soon as possible with a targeted opening in calendar year 2019.
The other future project Carter is working on is securing an anchor tenant for 180 Walnut, the office building that would be located in phase I of the Banks, just east of the Freedom Center. By 2018, the Banks is expected to have a regional impact of more than $1 billion annually with more than 5,000 permanent jobs from businesses located in phase I and phase II.
Having an available site for GE at the Banks played an important role in landing the eighth-largest company in the U.S. The region must have the developed product to market and attract new businesses to come there, Henning said.
“They’re looking for site-ready, site-certified locations,’’ Henning said. “And the Banks is a proven success how the community has come together.”
By pointing to GE at the Banks, REDI Cincinnati can show the region’s focus on job creation.
Fallon said he’s focused leasing at the Banks on capturing a specific customer: a female between the ages of 21 and 55 who makes 75 percent of the purchasing decisions in her home.
“If I can get her, all you guys will come,” Fallon said.
There are about 25,600 square feet of available retail space between the first and second phases. The bar to get into retail space at the Banks is a high one, Fallon said. But those decisions are made purposefully to make sure the development has the right mix of tenants.
In the last 60 days, 15 tenants didn’t make the list, Fallon said.
“It’s the toughest real estate committee in the country to get into the Banks,” Fallon said.
There have been a number of high-profile retail departures from the Banks, including Toby Keith’s I Love This Bar and Grill, Johnny Rockets and Mahogany’s. That’s not unusual for a retail development. Fallon compared it to Rookwood Commons and Pavilion, which are among the top shopping destinations in Greater Cincinnati. Those developments have had roughly 50 percent turnover.
San Marco said Eagle Realty is aiming to have the AC Hotel by Marriott open for Opening Day 2017. Room rates are expected to be between $165 to $185.
“We think it’s a great addition to the Banks and complements all of the other improvements,” San Marco said.
It took the city and the county a long time to find the right hotel for the Banks, Gabelman said.
“We didn’t want a hotel that would be something you could see if you drive off an exit ramp on a highway,” he said.
Mayor John Cranley, who has helped work on the riverfront development since he was a city councilmember, said the Banks is the key to what’s happening in Cincinnati.
“Our city’s renaissance is anchored by the front porch that you see when you come over that bridge from CVG,” Cranley said.
Senior Staff Reporter
Cincinnati Business Courier