Tuesday, April 25, 2000

Cost of Nordstrom deal questioned




By Robert Anglen
The Cincinnati Enquirer

        The ink hasn't even been put to paper yet on a $50 million deal to bring Nordstrom downtown, but already some council members are questioning its price.

        “It's crazy for us to be talking about bringing these folks out from Seattle when our own citizens are hanging out to dry,” said Councilman James Tarbell.

        For years, officials have tried to lure Nordstrom to Fifth and Race streets. But since store officials last week confirmed they intend to come to Cincinnati, council members asked whether the money could be better used.

        They want to know:

        • Will another Nordstrom proposed near Mason affect the downtown store?

        • Can private sources be found to supplant the city's $25 million contribution?

        • What has the city already spent to clear and prepare the store site?

        • What has Nordstrom done in other cities?

        “The question is the level of public subsidy,” Council man Todd Portune said.

        In addition to the $25 million, Nordstrom would get $10 million from a private equity fund generated by downtown businesses, a $5 million loan from the state and $9 million in tax increment financing, which allows a bond to be sold and then repaid through property taxes generated by the project.

        While developers negotiating the deal with Nordstrom have not spoken publicly, Mr. Portune said Monday that the store will sign a 20-year lease and 15-year operating agreement, meaning Nordstrom would agree to stay open for 15 years even if no customers ever walked through its doors.

        If an agreement is made, the store could be open by the summer of 2002.

        Richard Greiwe, president of Downtown Cincinnati Inc., said council is right to be asking questions and hopes to help get them answers.

        “(Council) needs to have all of this put in context,” he said, adding that downtown needs a mixture of retail, housing and businesses. “Nordstrom can help that.”

       



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