CINCINNATI — A brand new luxury hotel is expected to come to downtown Cincinnati.
The $174 million dollar project would redevelop the former Fourth & Walnut Centre and convert it into a 280-room hotel.
At the moment it's a vacant office building, with nearly 491,000 square feet of space. On the ground floor, you can see scaffolding surrounding the building. There's also reminders of the past. A former pizza joint has a note on the door thanking customers for 30 years of service. There's also some boarded up windows and graffiti on the wall.
"It's an old building, with old buildings comes really unique set of circumstances that require a lot of attention to detail by the architects," said Seth Walsh, Cincinnati City Council member.
On Wednesday, Cincinnati City Council approved a 15-year tax abatement for the developer, Supreme Bright Cincinnati, LLC. It will give the developer a 52% discount on its property tax bill.
"The reason we do that is to make the deal work, in terms of being able to complete the financing, what that ultimately does, is it creates a lot of jobs," said Walsh.
The city projects the new hotel and construction will bring in 381 new full time jobs and 498 construction jobs. The city will not be putting up any money for the project.
In city documents about the project, it says the developer is putting up $40,300,081 of its own money, and secured $88,431,256 in private financing. The renovations alone are expected to cost around $102,000,000.
The city also feels the project will "relieve" what it calls "Cincinnati's existing and worsening hotel demand issue."
"We need more hotel rooms, it makes sense and so I think the deal is finally making sense from an economic standpoint and then Cincinnati is finally rising to the challenge, and that's why today it makes so much sense that this deal happens," said Walsh.
City documents state that this project started in 2018 after the developer applied for a tax abatement. It explained that "rising construction costs, the COVID-19 pandemic, and issues with financing," put the project on hold. While there's no timetable for when the developer will break ground, Walsh expects the construction to begin within the next 18 months.
"At the end of the day, it really boils down to job creation, not only the construction jobs used to redevelop the building, but permanent jobs," said Carl Goertemoeller, executive director for the University of Cincinnati Real Estate Center, at the Lindner College of Business. "These projects are extraordinarily capital intensive and on virtually all of them, you need some type of tax abated assistance just to make the numbers work."
Goertemoeller, sees the city's deal with the developer as a necessary price of doing business, but also pointed out the future hotel's potential return on investment.
"My sense is that to fully utilize the soon to be redeveloped convention center, those hotel rooms are going to be necessary," said Goertemoeller.
"They're going to come here for the Reds, they're going to come here for the Bengals, they're going to come here for FC Cincinnati, they're going to come here for the Aronoff, and they're going to stay downtown," said Walsh. "This is a really, really big deal for the City of Cincinnati."
This building at Fourth & Walnut has seen some better days. But today, we are one day closer of seeing a brand new 280 room luxury hotel. @WCPO at 11pm, hundreds of jobs & the hundreds of millions going into the project. pic.twitter.com/gcbMNDFsfi
— Bret Buganski (@Bret_Buganski) September 12, 2024
