Is The Renaissance of Cleveland a Model for Other Midwestern Cities? (Columbus: universities, pharmacies)

[JohnDBaumgardner]

Originally Posted by costello_musicman

Jbc, do you have any estimates of what they are spending in Columbus right now?

Columbus is the only major city in Ohio that is growing.

Having lived in Columbus for just over a year ( 2009 - 2010 ), the city is definitely prospering. There's a fair amount of large scale projects underway in the districts that are ringing the city centre ...

Cleveland's projects are much more grand in scale though ... OSU spending 1.1 billion on campus buildings is impressive in it's own right, but there are several billions being expended across Cleveland ... from downtown to University Circle.

[costello_musicman]

Cleveland's definitely sounds more widespread (athough still concentrated in and around Downtown and University Circle).

OSU is great for Columbus and it's smart to invest so much money into it.

[jbcmh81]

Originally Posted by costello_musicman

Jbc, do you have any estimates of what they are spending in Columbus right now?

Columbus is the only major city in Ohio that is growing.

Well, I have no idea what the totals would be for all of it as I don't have a list of all the projects going on in the city or even Downtown. There's just too much of it. But here are some ongoing or recently announced projects that have been in the news recently:

Recently Completed, Ongoing or Nearing Completion:

Nationwide Children's Hospital expanision: $800 million
OSU medical center expansion: $1.1 billion
Flats on Vine condos: $50 million
Abigail apartment building downtown: $8 million
RiverSouth Condos: $40 million
Gay Street Condos (complex of 300 units): $100 million
Hilton Hotel on High Street: $160 million
New Courthouse: $105 million
Scioto Mile project: $38 million
Columbus Commons: $165 million (total cost for all phases)
Rich Street Bridge: $36.4 million
Main Street arch bridge: $60 million
Casino: $400 million
Wonderland arts complex renovations: $3 million
City Hall/Police HQ renovations: $23 million
Scioto-Audubon Metro Park: $10-$15 million

Announced or proposed:

Columbia Gas expansion in the Arena District: $50 million
10 story condo building in the Short North: $40-50 million
"The Joseph" hotel complex in the Short North just north of 670: $50million
Atlas Building renovation: $15 million
NorthStar restaurant/cafe condo addition: $4.5 million
Shadowbox theater renovation project in Brewery District: $3.25 million
Cooper Stadium redevelopment: $30-$40 million

I'm sure I'm missing quite a bit, but these are some of the main ones going on right now, mostly in the immediate Downtown area. I didn't really include anything within Columbus' city limits that was not Downtown, but there is a lot going on further out too. The total of the listed projects above is about $3.3 billion.

[west336]

I don't understand why there is ANY condo development going on right now, ESPECIALLY in the Midwest and ESPECIALLY in Ohio! Here's why: typically condos were confined to cities where owning a home was only affordable for the upper 1% of society, so condos were a compromise between renting and owning. Generally, condos are necessary where it's desirable to be in a certain area but you can't afford another housing option. The Midwest rarely fits that bill, and Ohio in particular is one of the cheapest states to own a home in. If you can own a house on a lot with 5 times more space than you could with a condo, your condo demand is going to come from a VERY specific demographic (typically people willing to completely downsize and young adults without chilldren). Even still, both of those demographics have the option to own a home and STILL have to prefer having less space for the tradeoff of (what I assume is) better location.

This isn't just for Columbus, Ohio or even the Midwest, but the nation in general. Condos were popular during the housing boom but I personally question their demand, from a real estate perspective.

my $0.02

[jbcmh81]

Originally Posted by west336

I don't understand why there is ANY condo development going on right now, ESPECIALLY in the Midwest and ESPECIALLY in Ohio! Here's why: typically condos were confined to cities where owning a home was only affordable for the upper 1% of society, so condos were a compromise between renting and owning. Generally, condos are necessary where it's desirable to be in a certain area but you can't afford another housing option. The Midwest rarely fits that bill, and Ohio in particular is one of the cheapest states to own a home in. If you can own a house on a lot with 5 times more space than you could with a condo, your condo demand is going to come from a VERY specific demographic (typically people willing to completely downsize and young adults without chilldren). Even still, both of those demographics have the option to own a home and STILL have to prefer having less space for the tradeoff of (what I assume is) better location.

This isn't just for Columbus, Ohio or even the Midwest, but the nation in general. Condos were popular during the housing boom but I personally question their demand, from a real estate perspective.

my $0.02

Honestly, I own a home now and my plan is to sell or rent it and move to a downtown condo/apartment. I've seen a ton of interest in that lately. It also seems like, especially since the census came out, that there's been a lot more "moving to Columbus" threads from out of state. It's growth seems to have been noticed a bit.

Whatever the reasons are, the demand is pretty strong for condos and apartments in Downtown Columbus, even the last few years during the recession. There has been talk/rumors of developing a 23 acre site just west of the Arena Distric that has some older factories on it right now. The last proposal I saw was for a 1000-1200 unit apartment/condo complex. Something like that would raise the population Downtown by 25%-30% alone. Not sure how likely that is just yet, or even if the proposal is still on the table, but it is the last major parcel of land in that area so close to the river. I can't imagine it will remain undeveloped too much longer.

[west336]

Are these buildings being pre-sold (like 40% or 50%) or are they mostly spec? If you say the word "condo" here in Minneapolis even urban enthusiasts like me will say "why?".

[jbcmh81]

Originally Posted by west336

Are these buildings being pre-sold (like 40% or 50%) or are they mostly spec? If you say the word "condo" here in Minneapolis even urban enthusiasts like me will say "why?".

I'm not sure what the pre-sold rate is, but there is obvious demand. The downtown population went up 30-45% in the last decade, and companies continue with large residential projects even in tough economic times. Everything I have read suggests high occupancy rates. Downtown, at least in Columbus, is now one of the best places to live, imo, and I plan to move there myself. There was just an article that stated that the 20-30 yo educated population grew 45% in the Downtown area.

Every city is going to be different. Perhaps there is a lot less demand for this in Minneapolis. Didn't the city lose a few people in the last census?

[costello_musicman]

All Columbus, Cincy, and Columbus saw huge Downtown popultion increases.

Downtown Cleveland population was up 49% since last census.

[west336]

Originally Posted by jbcmh81

I'm not sure what the pre-sold rate is, but there is obvious demand. The downtown population went up 30-45% in the last decade, and companies continue with large residential projects even in tough economic times. Everything I have read suggests high occupancy rates. Downtown, at least in Columbus, is now one of the best places to live, imo, and I plan to move there myself. There was just an article that stated that the 20-30 yo educated population grew 45% in the Downtown area.

Every city is going to be different. Perhaps there is a lot less demand for this in Minneapolis. Didn't the city lose a few people in the last census?

I don't know how in touch you are with real estate happenings in other cities, but the downturn in condo demand is pretty much a national trend, not just here in MN. When I was president of the Real Estate Club at Ohio State I remember having a few speakers who spoke about developing residential neighborhoods downtown, but at the time it was mostly conjecture and nothing more. There was/is still the issue of having the retail to support neighborhoods, such as grocery stores, pharmacies, etc. and which would drive which (retail driving residents or residents driving retail). It was pretty interesting to see all of this at the "grass roots" level when I was in college!

Cities like Minneapolis, Cleveland, Cincinnati, or anywhere with a defined border that has been built out for at least 50 years is going to have a lot of trouble maintaining and especially growing their municipal populations....simply because unlike Columbus those cities can't just develop on empty space. Everything is 100% redevelopment. Family dynamics change over time as well. In the 40's 7 people would live in a 1500 SF bungalow, now the avg. home size for a family of 4 is well over 2000 SF. Downtown Minneapolis' population hasn't grown 50%, but it probably has grown as much in raw numbers (my guess is 5,000 or so people, but I'm sure you can look it up). Its downtown population is easily 25K to 30K in 1.5 square miles.

[Observation]

I hardly call it a renaissance when city limits population dropped 80% in the past 10 years, but I will say that they are trying hard to bring the city back to it's former glory and if they don't give up and keep coming up with creative ideas and projects it will one day be a model for other midwest cities to follow. As of right now even Cleveland is faring much better than most of the region but it still has a long way to go.