1. The Port Authority’s Role in Driving Redevelopment
Paula Boggs Muething
Vice President of Community Revitalization & General Counsel
Port of Greater Cincinnati Development Authority
Real Property Law Institute
December 13, 2013
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3. Port Authority: History
• Established in 2000 from Ohio legislation by the City of
Cincinnati and Hamilton County
• In 2005 sought to be reformed by the City and County
• Reformed in 2008 with expanded funding and public
finance abilities
• New board of directors chosen in 2009
• Signed a development services agreement with the City of
Cincinnati for work in GO Cincinnati communities
• Hired new President/CEO at the end of 2011
5. Port Authority: Focus Areas
Real Estate
Development
Inclusion and
Community
Relations
Communication
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Community
Revitalization
Public Financing
Transportation
& Logistics
7. HCLRC “LandBank”
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Hamilton County Land Reutilization Corporation
Non-profit, quasi-governmental entity
Established by R.C. 1724
Operations commenced in March 2012
www.hamiltoncountylandbank.org
8. Mission
Return vacant properties to productive use
through the tools statutorily provided to the HCLRC
and by leveraging the resources of the HCLRC’s
executive arm, the Port Authority.
9. Purposes of the HCLRC
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Economic development
Blight abatement/nuisance remediation
Neighborhood stabilization/revitalization
Strategic parcel assembly
Historic preservation
10. Unique Redevelopment Tools
Port Authority: Traditionally strong in public finance – have
issued $540M in revenue bonds since 2000 on a variety of
projects
• Dunnhumby garage
• Oakley Station
• Queen City Square
• Fountain Square & 12th & Race lot with 3CDC
11. Unique Redevelopment Tools
Hamilton County Landbank: Removes barriers to redevelopment
• Obtain clean, marketable title on properties via tax foreclosure
and carry properties tax-free
• Engage in code enforcement and nuisance abatement as local
government agent
• Issue bonds and make loans
• Receive assignments of mortgages
• Repository for vacant and abandoned property
• Have achieved IRS tax lien release (Avondale)
• Remove tax lien encumbrances on properties purchased or
donated (High Impact Property Program, CBD & Bond Hill)
12. How We Work Together
Significant tools of the Landbank are
combined with the expertise and
relationships of the Port Authority
to establish partnerships with
community development
organizations and neighborhoodbased groups, focusing on
redevelopment work in key corridors
including neighborhood business
districts and residential areas.
16. How we work with others
(agencies, communities, developers, owners)
17. How we work with others
(agencies, communities, developers, owners)
Assemble teams for each real estate/community revitalization
project specific to its need:
• Industrial & office brokers
• Code compliance officers
• Engineers
• Remediation specialists
• Development consultants
• Real estate attorneys and bond counsel
• Marketing / branding resources
• CDCs
18. How we work with others
(agencies, communities, developers, owners)
Queen City Square Public Private Partnership
Participants: Western Southern, City of Cincinnati, Port of Greater Cincinnati Development Authority
City
– Approved the TIF
– Provided $3.75 million in grants
Port Authority
– Owns the project
– Leases the project to master lessee
– Issues TIF and Lease bonds
Western Southern
– Develops and manages the project
– Provides funding
19. How we work with others
(agencies, communities, developers, owners)
Lease Bond Financing
Port Authority purchases or constructs a facility and then leases the
facility to a master lessee who makes lease payments sufficient to
cover debt service on the bonds that financed the facility.
The general resources of the Port Authority are not pledged to debt
repayment and any lender or bondholder has recourse only to the
lease payments made by the lessee or any guarantor or to the asset
leased or financed.
Lease bond financings are heavily credit dependent and are
typically, but not exclusively, used by investment grade entities.
May offer the user financial, federal tax and accounting advantages,
attractive purchase options and other incentives.
20. Unique Regional Challenges to Redevelopment
• Broken sites: Underutilized, often require remediation,
brownfield
• Buildings with inefficient systems / high-energy use
• Neighborhood challenges include vacant properties, lack of
leadership capacity within community to facilitate change
21. Unique Regional Challenges to Redevelopment
“Broken” Site Characteristics
Brownfields
Vacated or underutilized for at least a decade
Integrated into neighborhoods
Small acreage, assembly required
Photo Credit: Google Maps
27. Unique Regional Challenges to Redevelopment
These sites generally had the same economic model:
Grant funds (often Clean Ohio) address assessment,
remediation and demolition costs
Public assistance with new infrastructure (often
through TIF or grant)
Bank financing with high LTV and a willingness to accept
the TIF as the “equity” component
Private sector developers with deep enough pockets to
absorb the unexpected
28. Unique Regional Challenges to Redevelopment
Pressure on Old Model
Bank market has adjusted
Clean Ohio has been significantly restructured
TIF market is weak
Higher interest rates
Additional security
Lower property valuations
Result in lower net dollars to the project
31. Unique Regional Challenges to Redevelopment
The New Paradigm
– Existing Tools:
Bank and public finance markets stabilized
Role of the State/Clean Ohio Revisions
– New Tools and Partners:
Landbank- clear past due taxes and liens, clean the
title
U.S. EPA Assessment Grant
Metropolitan Sewer District
– Mindset to solve locally
32. Unique Regional Challenges to Redevelopment
Cincinnati neighborhoods:
• Topography
• Density
• Masonry
• Remediation
• Neighborhoods
• Affordability
Focus Neighborhood: St. Bernard
36. Focus Neighborhood Strategy
Factors considered in selecting focus
neighborhoods:
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# of foreclosures
# of code violations/condemnations
Level of public and private investment
Educational and historic resource
Community engagement
Capacity of a lead community-based
organization
39. Focus Neighborhood Strategy
Purpose: To develop and execute housing and
revitalization strategies in targeted areas
• Engage with CDC/CIC as eyes/ears on the ground
• Identify small, defined priority area for residential and commercial
redevelopment
• Use a phased approach to
revitalization
• Work with lenders to develop
loan products that work
across markets
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52. Paula Boggs Muething
Vice President of Community Revitalization and General Counsel
Port of Greater Cincinnati Development Authority
pbmuething@cincinnatiport.org
www.cincinnatiport.org
513.621.3000
info@hamiltoncountylandbank.org
