There has been some very good news on the development front lately.
First came news that the iconic Pythian Castle downtown will be conveyed from the Lucas County Land Bank to developer David Ball for redevelopment. Ball already owns the adjacent former Greyhound bus station and a nearby parking lot, and the package of properties could become revitalized. Ball bought the Castle for a mere three Benjamins, and the Land Bank also gave him nearly three hundred thousand ducats to replace the roof of the building. Given the fact that millions more will be needed to rehabilitate the building, that is probably a small investment to save an important piece of Toledo history.
Then came word that the Toledo Museum of Art is interested in acquiring a set of rundown apartment complexes called Museum Place near its campus at Collingwood and Monroe. The Museum wants to secure the properties and return them to profitability. It has a keen interest in their success, given the buildings’ location at the Museum’s front door.
This is all good news. But where’s the devil in the details?
What’s the deal?
Take the Museum Place properties. They were recently owned by a now-defunct Community Development Corporation called Neighborhoods in Partnership (NIP). NIP acquired several properties in the Old West End and Uptown neighborhoods through federal grant money channeled through the City’s Department of Neighborhoods. The Museum Place complex was secured by bond money from the City, who in turn was granted a mortgage on the properties.
This was similar to other financial deals struck during the rein of none other than Carleton S. Finkbeiner, including one that led to the redevelopment of the Commodore Perry Hotel into apartments. The City made financial investments, and were positioned as a mortgage holder on the properties.
Except that the City was put into an untenable position on these properties. The Commodore Perry has become quite profitable over the years. The City continues to pay off long-term bond indebtedness while getting none of the burgeoning revenue.Paying the debt hamstrings the capital improvement dollars the City has available to do other things like fix roads.
Museum Place, on the other hand, is largely vacant and a financial drain. The City could foreclose, but it would still be paying off bonds and be saddled with the properties themselves. Meantime, NIP has gone belly up.
So the Art Museum now wants the City to foreclose and hand the properties over. The good news is that if the Museum later flips the properties for a profit, the City would get one-half of the money. And the properties might be restored to something like their original glory. The bad news is the City will still be on the hook for paying off the bonds, to the tune of millions of dollars.
As to the Pythian Castle, it will take large investment to restore it to prominence, and the amount paid by the Land Bank will be a drop in the bucket. But we remind you that the developer is David Ball. Who gets beaucoups bucks in rent from the City, because city departments are located in his buildings downtown.
This is the same David Ball who got the former steam plant downtown for a song and a promise from the City back in oh five. Ball never redeveloped it, then sold it for nearly two mill to Promedica for their new riverfront headquarters. Wethinks he has the wherewithal from the public trough to do give something back.
Be my sweetheart
Don’t get us wrong. We hope both projects are uber-successful. They will both be good for the city and the region. But we are reminded of the links both projects carry to the misguided public largesse of years gone by. And now both the steam plant and Museum Place will be owned by non-profits and taken off the tax rolls.
We are also reminded of the fact that we are all still paying for these sweetheart deals. It truly pays to know people in City politics.
