As RFPs come in, Debate over Opportunity Corridor Continues

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By Crain's Government Reporter, Jay Miller.

With the second of the three sections of the $306 million Opportunity Corridor now complete, the city of Cleveland is looking to hire a consultant to help it market and sell the land adjacent to the 2.5 miles of road under construction between Interstate 490 on the west and University Circle on the east to developers.

Mayor Frank Jackson and the road's supporters see it as a catalyst that could revive a portion of the city's impoverished southeast side that is called the "Forgotten Triangle."

Skeptics have downplayed the road's ability to spark redevelopment, with its harshest critics dismissing it as having value only as a faster way for West Siders to get to the Cleveland Clinic.

It's not clear what it will take to win the bid. Some development industry observers characterized the city's request for proposals (RFP) as vague and incomplete. One said it was a year too late, another that it was a year too early.


It could take as much as two decades, observers have indicated, to develop what could be as much as 1,000 acres that the city could assemble on both sides of the roadway.

The RFP seeks a proposal from a consulting team that will provide a suite of services likely requiring specialists from more than one firm. The RFP asks that the winning team take on a variety of tasks that range from a branding or public relations campaign to raising awareness of the availability of ready-to-develop land to creating a plan for a business park and then attracting developers and potential tenants to consider the site.

Responses to the RFP were due to the city by Nov. 16. A spokesman said last week that the city had received nine responses, although he declined to name the respondents. Calls to commercial real estate firms likely to lead a corridor consulting team were rebuffed, with firm representatives declining to speak about the RFP or even say whether they responded with proposals. Off the record, several executives said the city had asked firms to not discuss the RFP with reporters.

"If anyone talks to you, that means they didn't compete," said one.

Construction of the road, which began in 2015, is not due to be completed until 2021. A ribbon-cutting on Thursday, Nov. 29, marked the formal completion of Section 2 of the project, a half mile of road between East 105th and East 93rd streets. A new bridge takes East 105th over Norfolk Southern Railway tracks. Work is about to begin on Section 3, which runs from East 93rd to East 55th Street, where it links to the east end of I-490.

While building the roadway has been the responsibility of the Ohio Department of Transportation (ODOT), the city is responsible for developing the land along the corridor. It sees the new thoroughfare as the spine of a new neighborhood of commercial and residential development.

ODOT used eminent domain to acquire the land it needed for the roadway itself, which included some land fronting the road that can be developed. But supporters and critics alike are concerned about the ability of the city to assemble developable parcels in a timely fashion, since holdout homeowners unwilling to sell could stall land assembly.

Michael Cantor, a principal and managing director of Allegro Real Estate Brokers & Advisors, said his firm responded to the city RFP with a letter saying people at the firm and the engineering, marketing and advertising firms needed to round out a consulting team were too busy to complete a full response, though he said his firm, which has done earlier work assessing the corridor's real estate, might be interested.

One consultant, who declined to speak on the record, called the RFP vague and "a piece of shit."

The winner, this consultant said, will be set up for failure. "They don't control all of the sites, it's going to take a long time, the Opportunity Corridor construction isn't even done," he said. "There are so many other things the city could be doing for economic development. I was on one call (with city officials prior to the deadline) and I told my guys, 'Stop wasting your time. It's too early. There is still space in Midtown.' "

At the other end are strong supporters.

"I'm a fan," said David Wagner, a principal and managing director of Hanna Commercial Real Estate. "It could be one of the most transformative transportation projects in Northeast Ohio because you're going to connect (Interstate) 77 to (Interstate) 90. Three (RTA) train lines all connect in this neighborhood and there is a lot of empty, underutilized land."

Wagner declined to discuss the project or the RFP beyond that statement, which indicates Hanna Commercial responded to the city's request.

For more than a decade, the road has been a priority for Jackson because it would open for redevelopment large, development-ready tracts of land, much of it already zoned for commercial and industrial uses.

Though it still has an aging population, much of the land comprises abandoned industrial sites or neighborhoods pockmarked with abandoned homes or cleared former home sites.

As important to Jackson is the employment that redevelopment could bring to the area. A 2011 analysis estimated that development along the completed roadway could bring 2,300 jobs.

Over the last few years, the real estate development community and civic observers have sparred over the merits of the project. Those in the positive camp believe completion of the roadway will, over as much as 20 years, bring billions of dollars of investment and rejuvenate one of the city's poorest areas. On the other end of the spectrum are people who believe Cleveland, which was built out for a population of more than 900,000 but has seen that number shrink to under 400,000, doesn't need more roads.

In between are businesses that have objected to their neighborhood being disrupted, homeowners who don't want to move and civic skeptics who believe the development opportunities are overblown and question whether the city has the money or the time it will take to create developable parcels of land.

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