Tuesday, May 23, 2000
Council still not sure about Nordstrom
By Robert Anglen
The Cincinnati Enquirer
A letter of intent to put a Nordstrom department store in downtown Cincinnati got a mixed response Monday from council members, who say they don't know what they're getting.
They're not sure if the letter made public for the first time Monday should be treated like a winning lottery ticket or a $26 million bill.
Even with private businesses upping their contribution for the store from $10 million to $12.7 million, some council members are still questioning whether the deal makes sense.
I continue to emphasize "if,' because it is still an open question, Councilman Todd Portune said of the terms.
The letter outlines a $48.7 million package: $26 million from the city to build the store, a parking garage and skywalks; $12.7 million from the Cincinnati Equity Fund, formed by private businesses to help downtown development; $5 million in tax increment financing, which Nordstrom will repay in lieu of property taxes; and a $5 million loan from the state.
In return, Nordstrom agrees to lease property at Fifth and Race streets for 20 years, renewable for up to 70 years, and maintain the building, adjacent property and skywalks. It plans to open the store by spring 2003.
Officials with Eagle Properties, who negotiated the deal and will serve as landlord, told council's community development committee the store will significantly improve downtown.
Eagle vice president Thomas Stapleton said the city will have to spend about $8 million to improve the vacant Fifth and Race street site whether Nordstrom locates there or not.
He said Nordstrom is used to locating in malls, where the landlords build the store and waive rent in exchange for its ability to draw other retailers to the area.
In a brief summary to the near 300-page letter of intent, Mr. Stapleton listed dozens of benefits the city would realize from the deal.
But council members questioned whether those impacts would be diluted with Nordstrom's plan to open another store in Deerfield Township. They also asked if the money would be better spent in the city's neighborhoods or given to small downtown retailers.
Councilman James Tarbell said the city would better served putting the projects we have on the table now at rest, meaning using the money slated for Nordstrom to complete other projects such as Findlay Market.
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