The east and northeast quadrants of the greater Cincinnati market continue to exhibit strong growth in the retail sector. The greater Cincinnati market consists of five counties in southwest Ohio; six counties in northwest Kentucky; and two counties in southeast Indiana. The population is approximately 2 million people, which ranks the greater Cincinnati market as the second largest market in Ohio behind the greater Cleveland market and 23rd in the United States.

Development trends in the east quadrant are primarily new construction in previously undeveloped or underdeveloped areas immediately adjacent to Interstate 275, which loops the greater Cincinnati market. Projects include two 130,000-square-foot freestanding Lowe’s, one at Beechmont at the Avenue interchange and another at the Milford interchange.

An exception to this development pattern is the proposed redevelopment of the Beechmont Mall in Anderson Township. Current plans, which are not final, call for the enclosed mall to be detonated and then rebuilt as a village-style shopping center in a joint effort between the township and Columbus, Ga.-based developer Victory. The Township proposes certain amenities such as a lake to be used for stormwater management.

“Development activity in the north and northeast is the most active in the greater Cincinnati market and most highly publicized,” says Mark Addy, general counsel/vice president for Phillips Edison & Company in Cincinnati. There are a number of large proposed developments, which include lifestyle centers, enclosed malls and large strip centers. A race is occurring among the proposed developers to get their respective projects underway to preempt other projects. These projects include but are not limited to a 1.1 million-square-foot enclosed mall in Monroe; a 430,000-square-foot lifestyle center in Deerfield Township; and three lifestyle or mixed-use centers ranging from 200,000 to 500,000 square feet in West Chester. All of these developments are in various stages of approval and/or litigation.

Other significant developments are in the Central Cincinnati area or Northern Kentucky and involve in-fill locations. In the Norwood/Hyde Park area, approximately 10 years ago the Rockwood Pavilion was built on the old LeBlond manufacturing plant. It was expanded a few years ago to include a new Rookwood Commons that contains Wild Oats, Bed Bath & Beyond and Banana Republic. In addition to retail, an office building with parking was added.

Another significant development is the Center of Cincinnati in Pleasant Ridge. This development includes a Meijer, Target and Sam’s Club. It was constructed on another in-fill position in the prior location of the Cincinnati Milacron project. This project, midway between the I-275 loop and downtown, enjoys high visibility off of the Interstate 71 corridor.

Development of real estate in the downtown market has been hampered by the lack of clear direction from city leadership and the unwillingness to be decisive. The 2001 riots in downtown Cincinnati have hampered the downtown retail markets. However, northern Kentucky has again shown to be more progressive and action oriented. The recent Newport on the Levee, developed by Steiner & Associates, has been very successful. It enjoys a great view of Cincinnati and its new football and baseball stadiums. The mixed-use retail entertainment venue provides access to the Newport Aquarium and includes Barnes & Noble, Imax Theater, AMC Theatres, Mitchell’s Fish Market, Brio Tuscan Grille and Sega Gameworks.

Development in the north, northeast and east areas of greater Cincinnati are driven by income and population increases. In a recent study, American City Business Journals ranked Warren County, Ohio, as the most affluent in the greater Cincinnati market. The in-fill locations and development on the I-275 corridor are also pushed by the above income factors plus visibility and access.
Duke Realty Corporation, Cincinnati United Contractors, Steiner & Associates, Anchor Properties, Jeffery R. Anderson Real Estate, Neyer Properties, Al Neyer, Ackerman Group, Midland Atlantic, Continental and Regency Realty are some of the more active developers in the market.
New retailers in the market include J. Jill, Aldo, Lucky Brand Dungarees and White House/Black Market.

The north and northeast quadrants are affluent and growing quickly. To the north, the market is merging with Dayton. There is exceedingly more growth northeast toward Columbus which is only hampered by the issues of traffic and the distance from the downtown market. Cincinnati is discussing a light rail system that would help, but it is years away, if at all.

Northern Kentucky will continue to grow as the airport and its feeder businesses increase. Unfortunately, the Ohio River often seems like an ocean, which has prevented a true merging of the markets.
Western Cincinnati is hampered by typography and an infrastructure that cannot currently support retail growth. However, land is available and downtown Cincinnati is readily accessible.

“I foresee more growth in the east to northeast corridor as land is still attainable and relatively easy to access,” Addy says.

Cincinnati as a Midwest city in the so-called rust belt has a very diversified economy. It is a blend of the service/transportation markets of Columbus and Indianapolis with the manufacturing of Pittsburgh or Cleveland. A review of the largest employers listed above, with the addition of GE and the numerous colleges and universities, pays testament to the diversification. With variety brings stability in the retail markets. The challenge for Cincinnati over the next decade will be to forge ahead with pride to maintain the downtown as a vibrant market over the obstacles of competition from surrounding suburbs and racial unrest.

Mark Addy, Esq. is General Counsel/Vice President of Phillips Edison & Company.

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