MIDDLE MARKET HIGHLIGHT, OCTOBER 2005

COLUMBUS
Karen Stone, CCIM

Columbus is leveraging its strategic central location to spur investment in one of the primary pillars of its economy — logistics operations. The Rickenbacker area, which is located in the southeast portion of the metropolitan area adjacent to Columbus's primary cargo airport, Rickenbacker Airport, is adding 1,000 acres to accommodate industrial expansion. The area currently encompasses 13 industrial parks with more than 26 million square feet of development.

“As a part of our effort to continue to support the Rickenbacker Area's role as an advanced logistics hub, we have just broken ground on a state-of-the-art intermodal facility that will be operational in mid to late 2006,” says Matt McCollister, director of economic development for the Columbus Chamber. The facility will have air, truck and rail capabilities. The expansion plans have catalyzed a spurt of speculative development in the area. Chicago-based OPUS North Corporation is building a 750,000-square-foot warehouse/distribution center that is scheduled for completion before the end of 2006. Indianapolis-based Duke Realty Corporation has announced plans for a 572,000-square-foot-building in its park in the area, Groveport Industrial Center. Specifics of the development have not yet been finalized.

Columbus is benefiting from the recent Ohio tax reforms that support business development in the state by cutting personal income taxes of employees by 21 percent across the board. Also, inventory and tangible equipment taxes will be phased out during the next 5 years and will be replaced with a business activities tax. This change in tax base will reduce the costs of doing business in the area.

With 18 colleges and universities in its major metropolitan area housing more than 100,000 students, Columbus has a highly trained workforce that supports its expanding business service and medical sectors. “We have a high concentration of finance, insurance and retail operations headquartered in Columbus,” McCollister says. “Abercrombie & Fitch and The Limited brands have their headquarters here. Lane Bryant, which The Limited spun off to Charming Shoppes, decided to remain in the area and has announced plans to construct a new headquarters here that will be built by Duke Realty.” In the business services sector, Columbus has seen growth in call and data centers.

“All of the four primary health care systems in the area are expanding,” says Susan Merryman, also with the Chamber. “Recently, we were instrumental in pulling together a campaign to support the education of more nurses in the area to accommodate the expanding needs of those facilities.”

Driven by an aggressive incentive plan, downtown Columbus has seen $1.72 billion in public and private investment from 2000 to 2004. In 2002, the mayor of Columbus launched a comprehensive downtown plan to catalyze residential and office development. Focused on creating a community environment, a goal was set to develop 10,000 residential units in 10 years. So far, development is ahead of schedule. “More than 1,000 units are completed, and another 2,600 are in the pipeline, of which about 1,000 are under construction,” McCollister says. Creative and aggressive office incentives are also in place. For example, to help encourage workers and companies to remain downtown, one program allows 50 percent of the 2 percent city income tax paid by employees to go back to their employers. Some incentives are also tied to the length of lease terms.

Retail has a solid base in Columbus, anchored by the 1.5 million-square-foot, Steiner + Associates-managed Easton Town Center near the Columbus International Airport on the east side of downtown and by The Glimcher Company's more than 1.5 million-square-foot Polaris Fashion Place on the city's northern edge. The Polaris area is seeing additional development at the intersection of Polaris Parkway and Cleveland Avenue. According to Stephen Falor of Carey Falor Realty Partners, a 125-acre, office-based mid-rise park called Altair is under development. As part of the multi-use plan, a 1.4 million-square-foot Class A office complex being built by OPUS North is currently under construction. The multi-phase park will also feature two hotels, a conference center, six restaurants, more than seven acres of water features and 180,000 square feet of lifestyle retail.

As Columbus's economy emerges from the beginning-of-the-century downturn, McCollister sees a positive outlook for the city. “We are very optimistic about the future and, with the current activity, we feel we will have a very good year,” he says.  

©2005 France Publications, Inc. Duplication or reproduction of this article not permitted without authorization from France Publications, Inc. For information on reprints of this article contact Barbara Sherer at (630) 554-6054.