Cincinnati Ohio Economic Development

Christ Hospital covets national stage

Cincinnati.com • Laura Baverman
The Christ Hospital soon will relocate hundreds of office workers to a nearby building, part of a major expansion aimed at becoming a national destination for high-end cardiac and other medical care.

The move into a large vacant building at 237 William Howard Taft Road is possible following the close last Friday of one of the region’s largest development deals in years. The vacant building and adjacent Shriners Syrian Temple were bought by developer Al. Neyer Inc. for a project expected to be worth $20 million in two to three years.

Christ will be the building’s major tenant, signaling the hospital’s growing strength three years after it withdrew in a bitter battle from the regionwide Health Alliance and started rebuilding as an independent institution.

Finance, human resources and information technology workers will start moving into the Taft building in the summer. The space they vacate at the Auburn Avenue campus will allow for more medical clinics in growth areas including women’s health and cardiac care, for which Christ is attaining a national reputation.

The hospital’s grand plan includes possible construction of an orthopedics and spine-care tower at the site of its current parking garage.

The Al. Neyer deal clearly improves fortunes for the poor neighborhood around the Taft building as well. Hundreds of new workers each day will enter the neighborhood, near the University of Cincinnati and site of several new student apartments in recent years.

At the same time, the deal creates a unique ownership group that includes 20 African-Americans and females, only one of whom has ever owned a commercial property. They hold shares in the Taft Road building that range from $4,200 to $100,000, equity stakes rarely found in investment deals of this size.

“The Christ Hospital has a longstanding and important commitment to the Mount Auburn community,” said Jim Gray, Christ’s executive vice president of real estate and facilities management. “We’re thrilled to be able to expand the employment base here where our historic home is.”

Need for office space pushes movement around the area
Christ Hospital’s need for office space has grown in recent years as it added hundreds of administrative staff after the Health Alliance split. Christ severed ties to focus on adding services and burnishing the prestige of its own operation, rather than acting as part of a regional chain.

Administrative workers are now dispersed within the main campus buildings, the Baldwin complex in Walnut Hills and several suburban offices, Gray said.

When Hamilton County consolidated its Department of Job and Family Services in Over-the-Rhine last year, it freed up most of the nearby, county-owned Taft building. Christ found an opportunity to consolidate its own back-office workforce there, making room for expanded medical care on the main hospital campus.

The county also needed to unload its building to save $600,000 in annual operating expenses. County commissioners approved the property sale to Al. Neyer Inc. for $6.15 million earlier this year, with an agreement to let the county continue to operate a small tuberculosis clinic there.

Plan to include minority contractors was a plus
Al. Neyer’s plan to include minority owners also was appealing to Christ, which has aggressive supplier diversity goals, Gray said. The developer had tested the idea when it redeveloped the Vernon Manor Hotel into offices for Cincinnati Children’s Hospital Medical Center, which opened in March 2011.

Twelve African-Americans became first-time commercial real estate investors and majority owners in that significant project.

“It’s a top-down approach to inclusion as opposed to starting with vendors who supply to a project,” said Dan Ruh, Neyer’s vice president of real estate development.

The more people who realize returns from real estate investment, the more who want to get involved.

“To me, real estate is wealth building,” said Albert Smitherman, the ownership group’s organizer, who owns Jostin Construction in Walnut Hills. “My vision was to give middle-class African-Americans and workers who aren’t millionaires the opportunity to invest.”

Smitherman, a contractor on the Vernon Manor project, learned about the opportunity to invest in the Taft property from Al. Neyer’s former executive vice president, Laura Brunner. She recently was named president and CEO of the Port of Greater Cincinnati Development Authority, the agency primed to lead the region’s economic development efforts.

“This was very significant because it’s in our neighborhood,” Smitherman said.

“We all live or work within five miles and are able to see tangible results as we’re building wealth.”

He also believed the investment could lead to more work for local contractors. Seven of them have joined the investment group and will likely perform work and receive introductions to those who bid construction projects for Christ Hospital.

But Smitherman’s goal is still bigger. He plans to lead future syndicates of minority investors in even-larger local projects.

“If we expand the base of investors, there will be even more opportunities,” he said.

Taft renovation will adhere to eco-friendly standards
Al. Neyer will begin the massive interior renovation of the Taft building in February. The project also will include demolition of the Shriners Syrian Temple to make room for a large surface parking lot.

Constructed by Ohio National Life Insurance in 1959, the Taft building had been used as the company’s corporate headquarters until 1996.

Its token mural by the renowned local firm Millard Sheets, depicting scenes of people helped by life insurance, will be preserved within the lobby.

The renovation also will unfold according to the eco-friendly standards of the U.S. Green Building Council’s Leadership in Energy and Environmental Design program, Ruh said.

The Syrian Shriners, meanwhile, will move to temporary space while they search for a new facility to house special events, meetings and fundraisers for the annual circus, said Dave Metz, the real estate broker who sold the property. Membership has declined from 20,000 in the 1960s to 1,800 today.

“They want to control overhead but also attract younger members and their families,” Metz said.

Cliff Peale contributed.

Read the Cincinnati.com article here.