Manchester, Snider tax abatements

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   Posted: 12:00 a.m.
Thursday, June 11, 2015

Council to consider Manchester, Snider tax abatements

By Ed Richter

Staff Writer

MIDDLETOWN — 

Middletown
City Council on Tuesday will consider a tax abatement for the Manchester and Snider building projects.

Council’s
agenda for next week was released Wednesday that included a pair of resolutions
to authorize the agreements for the community reinvestment area tax abatements
for 100 percent for 12 years on both projects. This is less than the 20 years
that was sought by William Grau, the Illinois
developer leading the project and the owner of the buildings.

City
officials said the abatement is valued at approximately $104,000 a year for a
total of $1.24 million over the 12-year abatement period. The city’s portion of
the property taxes that would be abated is estimated to be $9,660 a year or
$115,920 over the abatement period.

In
2010, Middletown created a community
reinvestment area to use all reasonable incentive measures to assist and
encourage development in the downtown area of Middletown. Based on state guidelines, CRA
abatements can be used for residential developments, industrial/commercial developments,
or a combination of both.

Grau
recently informed council about his $12.7 million plans to redevelop the
93-year old Manchester Inn, which closed four years ago and restore it back to
an operating 70-room/suite boutique hotel.

The
redevelopment of the Manchester Hotel building into a boutique hotel with a
restaurant, conference and meeting space, and additional commercial office
space as well as the historic ballroom event space.

“The
redevelopment of the hotel would also represent a significant step forward the
downtown area,” according to a city staff report.

According
to the proposed agreements, work was scheduled to begin on June 1 and be
completed by Dec. 31, 2016 and is expected to create 73 new full- and part-time
jobs between Jan. 1, 2017 and Dec. 29, 2016. The dates were changed from a
previous document to reflect the new time frames.

Matt
Eisenbraun, the city’s assistant economic development director said in his
staff report the new hotel employees should generate about $860,000 in additional
annual payroll.

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Vivian Moon Members Profile Send Private Message Find Members Posts Add to Buddy List MUSA Council Joined: May 16 2008 Location: Middletown, Ohi Status: Offline Points: 4187	Post Options Post Reply Quote Vivian Moon Report Post Thanks(0) Quote Reply Topic: Manchester, Snider tax abatements Posted: Jun 11 2015 at 8:56am
	Posted: 12:00 a.m. Thursday, June 11, 2015 Council to consider Manchester, Snider tax abatements By Ed Richter Staff Writer MIDDLETOWN — Middletown City Council on Tuesday will consider a tax abatement for the Manchester and Snider building projects. Council’s agenda for next week was released Wednesday that included a pair of resolutions to authorize the agreements for the community reinvestment area tax abatements for 100 percent for 12 years on both projects. This is less than the 20 years that was sought by William Grau, the Illinois developer leading the project and the owner of the buildings. City officials said the abatement is valued at approximately $104,000 a year for a total of $1.24 million over the 12-year abatement period. The city’s portion of the property taxes that would be abated is estimated to be $9,660 a year or $115,920 over the abatement period. In 2010, Middletown created a community reinvestment area to use all reasonable incentive measures to assist and encourage development in the downtown area of Middletown. Based on state guidelines, CRA abatements can be used for residential developments, industrial/commercial developments, or a combination of both. Grau recently informed council about his $12.7 million plans to redevelop the 93-year old Manchester Inn, which closed four years ago and restore it back to an operating 70-room/suite boutique hotel. The redevelopment of the Manchester Hotel building into a boutique hotel with a restaurant, conference and meeting space, and additional commercial office space as well as the historic ballroom event space. “The redevelopment of the hotel would also represent a significant step forward the downtown area,” according to a city staff report. According to the proposed agreements, work was scheduled to begin on June 1 and be completed by Dec. 31, 2016 and is expected to create 73 new full- and part-time jobs between Jan. 1, 2017 and Dec. 29, 2016. The dates were changed from a previous document to reflect the new time frames. Matt Eisenbraun, the city’s assistant economic development director said in his staff report the new hotel employees should generate about $860,000 in additional annual payroll.

VietVet Members Profile Send Private Message Find Members Posts Add to Buddy List MUSA Council Joined: May 15 2008 Status: Offline Points: 7008	Post Options Post Reply Quote VietVet Report Post Thanks(0) Quote Reply Posted: Jun 11 2015 at 9:41am
	What happens if Grau defaults on his plans to upgrade the Manchester during any part of the 12 year term and has received these tax abatements on the premise that he would do the upgrades and fails to do so? Does he have to pay the city the entire abated 12 year taxes that he agreed to pay or just the years he was in development should he cease development early? Otherwise, the city is gambling on a promise that Grau will follow through. How does that work?
	I'm so proud of my hometown and what it has become. Recall 'em all. Let's start over.

swohio75 Members Profile Send Private Message Find Members Posts Add to Buddy List MUSA Citizen Joined: Jun 13 2008 Status: Offline Points: 820	Post Options Post Reply Quote swohio75 Report Post Thanks(0) Quote Reply Posted: Jun 11 2015 at 12:10pm
	actually, I believe the CRA tax abatement is only the increase in property value. So hypothetically speaking, if the Manchester has a taxable value of $125,000 and through improvements the value increases to $500,000--the tax abatement only applies to the $375,00 increase in value. Therefore if no improvements are made, no increase in value, no tax abatement. But I could be wrong.

Dean Members Profile Send Private Message Find Members Posts Add to Buddy List MUSA Resident Joined: Apr 15 2014 Status: Offline Points: 162	Post Options Post Reply Quote Dean Report Post Thanks(0) Quote Reply Posted: Jun 11 2015 at 12:49pm
	I would recommend Grau take the two buildings, write a business plan based upon his vision, with the National Register certification, and be selling both properties to a major national hotel chain, Marriott Properties, Westin, etc. Cash out on a Mm on a cap outlay below 100 Kk. Let a chain build his vision. Such an easy drive to UD and Miami in Oxford. UD now owns the Marriott and lease the brand name, and sub-contract the property management to another company. That works great for UD as they have the ability to use the hotel for alum, students, parents, and all the events occurring in Dayton.. Having GE across the street also helps. Cash out Grau, sell your vision and the credits.

spiderjohn Members Profile Send Private Message Find Members Posts Add to Buddy List Prominent MUSA Citizen Joined: Jul 01 2007 Location: United States Status: Offline Points: 2749	Post Options Post Reply Quote spiderjohn Report Post Thanks(0) Quote Reply Posted: Jun 11 2015 at 1:53pm
	interesting, Dean--amazing that our city leaders wouldn't have done the same. I have met Mr.Grau--seems very nice and genuine. I wish him all the best in this project. Still needs to trim his grass and weeds. We have been burned on most other city purchases/giveaways to date imo. No conditions, requirements or timelines ever included, and most of theses projects are at a standstill. No incentive to fix/develop anything until the taxpayers eventually pay for everything. Are we going to continue to do it the same way again? Anyone else heard a rumor that the Manchester may well turn in to a casino?

swohio75 Members Profile Send Private Message Find Members Posts Add to Buddy List MUSA Citizen Joined: Jun 13 2008 Status: Offline Points: 820	Post Options Post Reply Quote swohio75 Report Post Thanks(0) Quote Reply Posted: Jun 11 2015 at 2:00pm
	Projects may feel like a standstill, but partially due to he historic tax credit piece. Both properties on the NRHP. Grau has applied for tax credits during the March cycle for the Snider project because he wasn't quite ready to submit his application for the Manchester project. March awards have not been announced. Because the tax credits require restoration, you have to be extremely careful on work that's done otherwise, those credits could be jeopardized The process is painfully long. Look at Hamilton and how long some of their development projects downtown have taken.

Vivian Moon Members Profile Send Private Message Find Members Posts Add to Buddy List MUSA Council Joined: May 16 2008 Location: Middletown, Ohi Status: Offline Points: 4187	Post Options Post Reply Quote Vivian Moon Report Post Thanks(0) Quote Reply Posted: Jun 11 2015 at 2:34pm
	Talking about historic restoration of the Manchester Inn. Yes these rules are very restrictve and therefore I'm unsure if Mr Grau can make all the upgrades needed to compete with the motels out by I-75. He better have his ducks in a row before he submitts his blueprints and his plans to the Historic Committee in September.

409 Members Profile Send Private Message Find Members Posts Add to Buddy List Prominent MUSA Citizen Joined: Mar 27 2009 Status: Offline Points: 1014	Post Options Post Reply Quote 409 Report Post Thanks(0) Quote Reply Posted: Jul 08 2015 at 3:29pm
	MJ: 2 Middletown projects receive tax abatements By Ed Richter Staff Writer MIDDLETOWN — Middletown City Council approved a pair of tax abatements Tuesday for the redevelopment of the former Manchester Inn and the adjacent Snider Building. Illinois-based developer William Grau announced plans earlier this year to restore the Manchester Inn, which closed four years ago, to an operating 70-room/suite boutique hotel with a restaurant, conference and meeting space, and ballroom. The estimated cost of the project is $12.7 million. The tax abatement approved Tuesday for the Manchester Inn is valued at approximately $104,000 a year for a total of $1.24 million over the 12-year abatement period. The city’s portion of the property taxes that would be abated is estimated to be $9,660 a year — or $115,920 over the abatement period. The Snider Building is to be redeveloped as a brewery, taproom, distillery project that would have a direct relationship with the Manchester Inn redevelopment. The estimated cost of that project is $3.5 million. The tax abatement for the Snider Building, also known as the Sonshine Building, is valued at $45,000 a year for a total of $546,00 over the 12-year abatement. On Tuesday, Grau told the Journal-News he would be resubmitting an application for state historic tax preservation tax credits for both the Snider Building and Manchester Inn projects. The application submitted in March for the Snider Building project was ruled ineligible for that award cycle because no pre-application meeting was held with the State Historic Preservation Office. “Our original intent was to apply in Round 15 (September 2015) for both the Manchester Hotel and Snider Building but choose to submit an application for the Snider Building in Round 14 in hopes of getting a jump on the microbrewery,” Grau said via email. Grau also said the group is currently in talks with several existing microbreweries as potential partners, including Cigar City Brewing located in Tampa, Fla. Assuming the State Historic Tax Credits are awarded in December, Grau said construction on the Snider Building could begin in January 2016 with the completion and opening of the microbrewery and taproom in September, just in time for Oktoberfest. He also said that assuming New Market Tax Credits are secured and the State Historic Tax Credits are awarded in December, the Manchester Hotel construction could begin in April 2016 with completion and opening in June 2017.
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