Crain’s Cleveland Business
Michelle Jarboe
Industrial Commercial Properties LLC recently inked an option agreement to buy the land from the city of Ontario, which took possession of the property two years ago after a prior development plan fell through. Ontario City Council voted late Wednesday, Nov. 18, to sign off on the option and to approve the first sale, of 6 acres and the sole remaining building.
“We want to get jobs there,” said Randy Hutchinson, mayor of this city of 6,000, which incorporated two years after GM opened its Mansfield-Ontario Stamping Plant in the 1950s. “That’s the number one priority. Just having some activity there is, I think, fantastic. Activity breeds activity.”
Owner Chris Semarjian estimated that about 75% of the former stamping-plant site — roughly 200 acres — is buildable.
“In Ohio, there are very, very few … 200-acre sites that can be developed right away,” Semarjian said in an interview. “Plus, we have a 2-million-square-foot foundation in place, if somebody wants to build a big plant.”
ICP has agreed to pay $525,000 for the future Charter Next Generation building and the initial 6 acres, Hutchinson said. The company’s option agreement with the city and the nonprofit Richland County Growth Corp. sets a price of $5,000 an acre. The agreement carries a five-year term.
That pricing, and the ability to gradually acquire the property rather than buying it all at once, made the deal more feasible for the developer. ICP might sell land directly to companies, enter ground-lease arrangements or construct buildings to suit specific tenants’ needs, Semarjian said.
A full redevelopment could take two to six years, depending on whether the industrial real estate market in the region stays hot, with strong demand for space and scant new supply.
“If industrial continues the way it is now, it’s going to be on the earlier side,” Semarjian said. “But who knows? We’ll see what happens with the economy.”
By the end of this year, ICP expects to have a stake in 145 properties totaling more than 43 million square feet. The company is on track to close more than 25 acquisitions, spanning 30 buildings and 400-plus acres, in 2020.
Those transactions include the recent purchaseof 377 acres of the former Geauga Lake Park property in Bainbridge Township and ICP’s planned shift from noteholder to owner at the long-troubled City View Center retail site in Garfield Heights. That property, which ICP plans to reposition as a business park, is scheduled for auction by a court-appointed receiver Dec. 10.
Chris Salata, the company’s chief operating officer, said the potential for job creation is a common thread across ICP’s eclectic holdings.
In Ontario, the developer has been talking with city officials, statewide economic development corporation JobsOhio and Team NEO, JobsOhio’s regional affiliate, about avenues to promote and pay for the project.
The option agreement states that the company will pursue at least $5 million worth of incentives from the state, county or other governmental sources.
“At this point, at least from our perspective, we’re still investigating, going along on the journey with ICP to understand what their vision is,” said Christine Nelson, Team NEO’s vice president of project management, site strategies and talent acquisition. “We haven’t had any direct conversations about support.”
Projects on the site could qualify for JobsOhio’s fairly new Ohio Site Inventory Program, which offers developers grants and low-interest loans for speculative building projects and land preparation to fill gaps in the market.
Salata said ICP also is exploring potential federal assistance, including possible funding through an Economic Development Administration program meant to help communities respond to and recover from the coronavirus pandemic.
Team NEO and ICP have talked about taking the property, which already has been cleaned, through the SiteOhio authentication program. Participating sites are deemed shovel-ready, added to a state database and marketed by economic development officials.
“As a former manufacturing plant, all of the infrastructure is there. It has the electrical and the gas lines and the water and sewer lines that are needed to support industry,” Nelson said, noting the site’s proximity to U.S. Route 30 and its location midway between the Detroit automakers and industry suppliers and manufacturers in northern Kentucky.
The property also has a railroad connection, which ICP plans to reactivate.
George Pofok, a senior vice president with Cushman & Wakefield/Cresco Real Estate in Independence, said the former stamping-plant site languished because it wasn’t in the right hands. He described ICP, with its vast portfolio and deep bank of tenants, as a strong choice to turn untapped potential into productivity.
