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Port Authority bonds to support portion of Crocker Park development

This architectural rendering shows the planned extension of Main Street in the area referred to as Block G at Crocker Park. Four five-story buildings will include 50 retail storefronts and more than 300 apartments. (Image courtesy of Crocker Park / City of Westlake)

By Kevin Kelley

Westlake

Crocker Park will proceed with plans to add a hotel, residential units and several restaurants near Nordstrom Rack, thanks in part to bonds that will be issued by the Cleveland-Cuyahoga County Port Authority.

The bonds will be used to finance public infrastructure improvements – including underground utilities, driveways, surface parking areas, sidewalks and streetscaping improvements – in and around the northeast corner of Crocker Park, an area referred to as Block K.

Block K is projected to add $22 million in property value to Crocker Park.

At its March 6 meeting, Westlake City Council passed an ordinance after one reading authorizing the city to enter into an agreement with the port authority, Crocker Park and other involved parties related to the Block K public improvements. The vote was 5 to 0. Ward 4 Councilman Michael O’Donnell, who is employed by American Greetings, the company moving its headquarters to Crocker Park, abstained. Ward 5 Councilman Ken Brady was absent.

The bonds to be issued by the Port Authority are called tax increment financing bonds. Those are the same type of bonds the city of Westlake has agreed to issue, up to $48.1 million, to finance public improvements at the southern end of Crocker Park. That deal, which will finance three parking garages and work on Crocker Road, was made to entice American Greetings to relocate to Westlake and encourage Crocker Park to expand southward with new retail and residential development. Instead of paying property taxes for the next 30 years, American Greetings and Crocker Park will make payments in lieu of property taxes to repay the bonds issued by the city.

Stark Enterprises, the owner and operator of Crocker Park, had asked the city to also issue tax increment financing bonds to finance the Block K public improvements. But analysis by the city’s financial adviser, Matt Stuczynski, of Huntington Investment Co., said an additional $6.3 million of debt issued in the city’s name might jeopardize the Westlake’s top credit rating with the three major bond rating agencies.

Mayor Dennis Clough, who views Westlake’s top bond rating with great pride, decided against issuing the additional $6.3 million in bonds because of the credit rating issue. It had been an open question all along as to what entity would issue the Block K bonds, Clough added.

City Council President Mike Killeen said substituting the Port Authority for Westlake as issuer of the Block K bonds doesn’t change very much in terms of the overall plan to expand Crocker Park. The city will simply pass along Crocker Park’s payments made in lieu of taxes to the Port Authority, he said.

In addition to operating the Port of Cleveland, the Port Authority provides financing for a wide range of new construction and economic development projects across the region. State law grants port authorities certain powers to facilitate economic development. The Port Authority received revenue from its port operations and a countywide property tax, but no tax dollars are used to finance economic development projects.

Garth Woodson, the Port Authority’s vice president of development finance, said Crocker Park’s request for financing may be on the agenda of its April 17 board meeting. The specific amount of financing Crocker Park is seeking has not been finalized, Woodson said. He said the Block K development is in line with the types of projects the Port Authority finances.

In October, the Port Authority’s board agreed to provide up to $10 million in tax increment financing bonds to fund the redevelopment of the former Parmtown Mall. The following month, the board approved the issuance of up to $97 million in bonds for Phase II of the Flats East Bank project, as well as up to $57 million in bonds for the development of a mixed-use development project next to the new headquarters building for Cuyahoga County.

In related news, City Council approved a storefront and signage plan for Bonefish Grill, a new seafood restaurant coming to Block K. The Florida-based chain has more than 160 locations across the country, including one in Independence.

Also at its March 6 meeting, City Council gave final approval to Crocker Park’s Block G development plan. The plan will extend Crocker Park’s Main Street southward with four five-story buildings that will include 50 ground-level retail storefront and 316 apartments. The expansion had previously received the unanimous approval of the planning commission.

 

 

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