Cincinnati City Council voted Wednesday to give final approval to selling the former Saks Fifth Avenue building to 3CDC for one dollar, plus approve a 30-year tax exemption and $2 million to support the renovation.
Saks Fifth Avenue closed its store in downtown Cincinnati in 2022. The city purchased the property for $3 million last year, and has been responsible for maintenance and property taxes since then.
3CDC Executive Vice President Adam Gelter says they are limited with what they can do with the space. "The Hyatt ballroom sits above the former Saks; it's hard to see. Some people don't know that. There's a shared loading dock. So you really can't get rid of the building. You really gotta deal with what's there," he told a council committee Monday. "Similarly, because it's a department store, it doesn't really work for residential conversion or hospitality conversion."
Gelter says the building doesn't get a lot of natural light.
The project is expected to cost just over $30 million. It would remove the skywalk over Race Street, and the walkway between the Hyatt and the Netherland Hotel.
The city is selling the site to 3CDC for just a dollar, but Gelter says the project is an important partnership with the city.
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"This is where we have pledged to share the revenue that is generated from this building with the city, regardless of the amount of revenue that is earned on the back end, so that we truly are partners in this."
Vice Mayor Jan-Michele Lemon Kearney voted against the $1 sale, saying she's concerned about a lack of minority-owned and women-owned developer involvement in the project.
"Those entities are never going to grow and never learn how to do these larger projects if never given that chance," she says.
Gelter says there's no real profit for any developer in this project.
"Folks want to spend their time on a project that they're going to make money," he says. "We want to set folks up for success, and I don't think there's a lot of success to be had here from a monetary perspective."
City Manager Sheryl Long said Wednesday the city is working to empower minority developers, but this project is very complicated.
"Rome wasn't built in a day," she told Council. "We are now starting from scratch, and we are starting to move into that direction and it's just going to take time. But a lot of these buildings that are in our downtown, they're not suitable for first time developers."
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Gelter says 3CDC is interested because the property is close to the planned Convention Center District, and a vacant space there isn't good for anyone. City and Hamilton County officials tapped 3CDC to oversee the district, which includes a major renovation of the Duke Energy Convention Center and a new convention hotel.
The $2 million cash support comes from the Downtown South/Riverfront TIF District, which holds property tax revenue from within the district to be spent on projects that benefit the public in the same area.
