5th & Race: The Benefit of History (Part 2)

Every decision starts with underlying assumptions about the future.  For more than 20 years our vision for reinvigorating downtown was based on a memory of what success looked like in Cincinnati’s past.  Saks, Macy’s, Tower Place, Convention Center Mall – all of it was an attempt to compete with the malls in the suburbs and return the city center to the “former retail glory” of the 1960s when people came downtown to work or shop.  We were so sure that today would look like yesterday that we made one expensive, publicly subsidized bet after the next regardless of the actual results of each individual project.  Something was going to work.  We just hadn’t found the right combination yet.

The worst day in Cincinnati real estate development history, the day that Nordstrom said that the deal for a store at 5th & Race was dead, arguably turned out to be the best thing that could have ever happened to us.   That was the day we finally had to face the reality that the world had changed. And it wasn’t just the malls that were knocking the stuffing out of our “former retail glory” thesis.  Amazon had arrived and there was no magic store that was ever going to lure people back to urban centers again no matter what we tried.

Lucky for us there was a wacky team of brothers at Towne Properties with the ability to see beyond what already exists.  As the history on their website reminds us, “Towne assumed a leadership role in the renaissance of downtown Cincinnati in the early 1990s with new partner Arn Bortz, former Cincinnati mayor, in charge.”  Towne began developing renovated office space and mixed-use projects, including the Backstage Entertainment District and Fountain Place in the heart of downtown Cincinnati – as well as residential properties like the Gramercy, Greenwich, and the Shillito’s Lofts.  I still remember the very first time I heard their idea that the only way to reinvigorate downtown was to get people to live there again. They might as well have suggested we move to Mars.  But a couple of decades later I am an enthusiastic downtown resident and there are waiting lists of people interested in more housing options here.

What concerns me about the current batch of publicly subsidized developments going up at breakneck speed is that I see an awful lot of investment assumptions that our future is going to look like the past , that if one hotel or one new parking garage worked, we need as many as we can get – and maybe nobody in city development has noticed yet – but the world is changing faster than ever.  According to the bets we’re making, we seem quite sure that the dominance of the big corporation as we’ve known it is a law of nature, that it’s not possible to have too many parking spaces, that traditional office space in high rise office towers is always a “boon to Cincinnati.”

Tastes  and times change.  The market is already telling us that loud and clear. Intelligent, well-considered risk is essential to growth on both an individual as well as a community basis.  But every one of these expensive buildings that we are subsidizing is a bet on how the future will evolve.  Look around at the amount of construction and the size of the deals.  We better be darn sure we’re investing in the future and not a hopeful wish from our past.

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