Some major Columbus development projects on hold while others move forward – msnNOW

Provided by The Columbus Dispatch Work is progressing on Gravity 2, across West Broad Street from the original Gravity mixed-use development in Franklinton that opened in April 2019. The second Gravity phase will be larger and include residences, offices, restaurants and parking. As work on it moves forward, developers are trying to anticipate how the pandemic will change what people want in their living and working spaces. [Doral Chenoweth/Dispatch]

At least one major Columbus development is on hold and others are being downsized as builders and lenders try to grasp the long-term damage caused by the coronavirus pandemic.

A plan to build offices, residences and a parking garage on South 3rd Street across from the Statehouse has been paused because of the crisis.

In addition, new hotels planned for Grandview Crossing and in Worthington have been delayed or halted as the hotel industry wrestles with its worst crash in a century. An office building in Italian Village also is on hold.

"There's never been so much uncertainty," said Mike Schiff, CEO of the Columbus development firm Schiff Capital Group. "It makes it tough for anybody to make a business decision now."

For the most part, developments already underway, such as the new Crew stadium and the Hilton hotel tower next to the Greater Columbus Convention Center, continue to move forward.

Other major Columbus projects also are proceeding, including one of the most ambitious the first phase of a massive development on the west side of the Scioto River, next to COSI Columbus.

"The Scioto Peninsula project is moving full steam ahead," said Amy Taylor, chief operating officer of the Columbus Downtown Development Corp., which is overseeing the project.

The first four buildings in that development a hotel, an office building and two apartment buildings are scheduled to come before the Columbus Downtown Commission on Tuesday. Plans for a parking garage are expected to be presented in June, and construction should start in September.

Also moving ahead: a $200 million complex on the North Market parking lot that will include a hotel, offices, residences, restaurants and a parking garage.

Jim Merkel, CEO of Rockbridge, a key player in both the Scioto Peninsula and North Market projects, is confident they will proceed on pace despite huge uncertainties in the hotel and office industries.

"The reality is some people will be able to get their projects moving forward and some will not," he said.

In Franklinton, work is proceeding on Gravity 2, the second and largest phase of the Gravity development on West Broad Street, said its developer, Brett Kaufman.

"The COVID situation has made things more complicated and has slowed things down, but we're still moving forward," said Kaufman, CEO of Kaufman Development. "We're taking this opportunity to make sure we're adapting our product to what the new world of offices will look like."

Kaufman said the project has been tweaked to include touchless elevators and doors, antibacterial surfaces and a more sophisticated air-circulation system.

Work also is moving ahead on the redevelopment of the Trolley Barn site in Franklin Park, a key project in the revitalization of the Near East Side.

"When this happened, there was a period of unknowns when we slowed down because we didn't want to put people at risk," said Brad DeHays, with the developer Connect Real Estate.

"We were supposed to open at end of the year. That will be a tough timeline to hit," he added. "The next six months will determine if we can get back to our original schedule."

DeHays and others worry about the long-term damage to Columbus' growth that a slowdown could cause.

"If we stop new developments now, we're going to have a huge hole in our economy in a few years," he said.

Other developers are stepping back until the coronavirus dust settles.

One of the largest projects on hold is a mixed-used development on the northeast corner of East State and South 3rd streets across from the Statehouse.

"At this point, we have paused our development efforts," said Chris Ruess, president and CEO of Capitol Square, which was developing the site with Elford Development.

"We have taken our foot off the proverbial pedal to see where this situation leads us. But we remain prepared and eager to quickly move forward when current market disruptions subside."

Offices, which made up a key part of the Capitol Square project, are facing enormous uncertainty as companies wrestle with the long-term implications of working from home.

"Every company we're talking to is evaluating, first and foremost, their remote working strategies and what that means for offices moving forward," said Robert White Jr., president of the Columbus office builder Daimler, which is still planning to build a 240,000-square-foot speculative (without a tenant) office building on the Scioto Peninsula.

Wagenbrenner Development also is facing office-related questions as it moves forward on the final stages of its Jeffrey Park development in Italian Village, which was originally scheduled to include a major office building overlooking Interstate 670.

"We're confident office will still lease there, (but) it's definitely delayed," said Mark Wagenbrenner. "There's users circling, and we're entertaining those users, and we could react quickly if a user came along."

A hotel planned for Wagenbrenner's Grandview Crossing development also will be pushed back at least a year, he said.

"We've postponed the one hotel project, but the residential remains strong, unbelievably strong considering what we've been through," he said.

While Wagenbrenner expects a hotel to eventually be built at Grandview Crossing, that's not the case with the redevelopment of the former Holiday Inn site in Worthington.

The developer, the Witness Group, announced in April that the project will not include a Tru by Hilton hotel. Instead, Witness hopes to fill the space with high-end offices.

Developers agree that the safest projects now are residential, where demand seems undiminished by the pandemic.

But even those projects are being delayed, in part because cities and townships have struggled to hold the necessary meetings to approve projects during the pandemic.

"We're definitely seeing demand," said Tre Giller, CEO of Metro Development, which is working on nine apartment complexes in central Ohio right now.

"The real issue is, if you didn't have a project approved and ready to start before the pandemic hit ... you're now 60 to 70 days behind where you thought you would be."

Giller said three Metro Development complexes with about 1,100 apartments have been in limbo for much of the spring.

"It's causing delays that are starting to kill projects," he said. "Landowners don't want to wait forever. The market changes; situations change."

jweiker@dispatch.com

@JimWeiker

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Some major Columbus development projects on hold while others move forward - msnNOW