MIDDLE MARKET HIGHLIGHT, MARCH 2006

TOLEDO
Karen Stone, CCIM

In 2005, Toledo was one of the top metropolitan areas in the United States in terms of business expansion, placing in the top 20 percent of all 362 metropolitan statistical areas in the country. Situated at one of the nation's major crossroads, Interstate 75 and Interstates 80 and 90, Toledo has weathered the Midwest manufacturing downturn and is moving forward with brisk activity.

Downtown Toledo is seeing expanded activity on both sides of its centerpiece, the Maumee River. Downtown Toledo Inc. (DTI) is a public/private partnership that is leading the effort to create a sustainable, vibrant downtown. DTI has created a specific master plan that was adopted in 2002 and received a financial boost in January of this year. Reliable funding sources, including the classification of Toledo's downtown as a special improvement district, are coming together to put the plan into motion. The result, according to Pete Gozza, president and CEO of DTI, is $2.5 million in seed money that will be poured into downtown during the next 5 years.

“In 2000, we decided to be very strategic in our approach to downtown revitalization. We are now working with the Regional Growth Partnership, the Port Authority and other strategically aligned groups to turn the vision into reality,” Gozza says. Indianapolis-based Development Concepts and LDR International of Columbia, Maryland, have acted as consultants for the downtown plan.

On the east side of the Maumee, National Basketball Association player Jimmy Jackson has partnered with local developer Dave Ball to renovate a former steam plant into a collection of apartments and condominiums. When completed late this year, the project, located in the Warehouse District and known as The Steam Plant, will add 100 residential units to the 150 units that have been built in downtown since 2000. Next to The Steam Plant, DTI has proposed plans to redevelop the central riverfront area into a public waterfront park. DTI's plan also envisions Lafayette Street, which runs through the Warehouse District, being streetscaped into the area's pedestrian-oriented “main street.”

Plans for The Marina District project, located across the river from The Steam Plant, are moving forward. The project's developer, Columbus, Ohio-based The Pizzuti Companies, has presented preliminary plans to the city.

Downtown's upcoming crowning glory, the $220 million Veteran's Glass City Skyway, has experienced some construction delays and may not open until early 2007, 6 months after its projected completion date. Fru-Con Construction Company of Ballwin, Missouri, is the project's general contractor. Once completed, the Skyway is expected to be the new signature of downtown and a model of state-of-the-art design and construction.

In the industrial sector, the expansion of the DaimlerChrysler Jeep plant in north Toledo has sparked more than $2 billion in investment by suppliers that provide delivery of parts to the plant. In 2005, more than 1 million square feet of manufacturing/warehouse space was committed to, or occupied by, suppliers such as Faurcia (100,000 square feet), Decoma (100,000 square feet), Dana Corporation (100,000 square feet), and Toledo Tool and Dye (80,000 square feet). This influx of suppliers absorbed almost all available space in existing buildings and has tipped the scales in favor of new development.

In November 2005, First Solar, one of the world's largest manufacturers of solar panels, broke ground on a 250,000-square-foot expansion of its existing facility located in the Cedar Business Center in Perrysburg, Ohio. Walbridge, Ohio-based Rudolph/Libbe Inc. sold First Solar its current site and built the original 75,000-square-foot facility in 1999. According to Scott Libbe, executive vice president of Rudolph/Libbe, “We completed construction on the new 250,000-square-foot building in early January and we are currently installing the new equipment. We anticipate the new facility will be up and running by the summer.”

A $113 million renovation and expansion of the Westfield (Franklin Park) Mall in west Toledo was completed in late summer of 2005. According to Sam Zyndorf, managing partner of Signature Associates • ONCOR International, “Westfield Mall and the area surrounding it have always been the epicenter of retail in Toledo. The area around the mall is strong, with retail rents exceeding $20 per square foot and land selling for more than $1 million per acre.” With the 238,000-square-foot expansion, the mall has approximately 1.22 million square feet of shops and other entertainment tenants, including more than a dozen retailers that are new to the area, and a 16-screen, 2,700-seat stadium-style movie theater, Franklin Park 16: Cinema De Lux.

Wal-Mart is expanding its presence in the Toledo market. Its fourth Toledo store is under construction on McCord Road in Springfield and should open by late summer. Plans for its fifth store, to be located in Perrysburg on Freemont Pike at Simmons Road, have been submitted for site plan approval.

A proposal that will allow the University of Toledo and the Medical University of Ohio to merge is on this year's legislative agenda. The combined university would be the third largest in Ohio and bring the schools' medical, engineering and pharmaceutical programs under one roof — a unique combination. It is anticipated the synergies of the two schools will create a powerhouse in incubating new businesses and will spur expansion of a dynamic science and technology corridor, modeled after the Raleigh/Durham Research Triangle. In November 2005, the state passed a $500 million bond issue earmarked for the Third Frontier Program, a new initiative that will foster the commercialization of new technology. Approximately $1.35 million of these funds will be used for infrastructure in the technology corridor that will in turn support the development of $150 million in job-ready sites.

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