CLEVELAND, OH (WOIO) - With the Quicken Loan Arena Transformation project getting axed this week after the Cleveland Cavaliers backed out of the deal, Cleveland 19 is looking at other downtown projects and where they stand like the NuCLEus project.
The NuCLEus project is by far the most ambitious project trying to become a reality in downtown.
Being developed by Stark Enterprises, this 48-floor spire of glass would change the skyline in Cleveland.
It's planned for the parking lot and parking structure across the street from The Q on Huron Road. The building would include 500 apartments and condos, 200,000 square feet of office space, a luxury hotel and restaurant and retail space.
The project was given basic approval by Cuyahoga County in 2014, but there has yet to be one shovel put in the ground.
This project is going to need major financing and Stark is still trying to work a deal with the Cleveland Metropolitan School District (CMSD), the county and the city.
Tax Incremental Financing (TIF) is a creative way to get tax breaks up front to get a project financial approval. The TIF request for NuCLEus is far from being voted on by the city but the CMSD CEO Eric Gordon is pushing hard to get it completed with community meetings and website to answer all questions.
In exchange for suspending property taxes for 30 years, Stark would pay the schools $18 million up front.
CMSD would like to take that $18 million and get it matched by State grants for an additional $38 million and use for school building and renovation projects. The school board was suppose to vote on its support of the TIF plan in its August 22 meeting but it was pulled from the agenda with no rescheduled vote.
Regardless of how the school board votes, the ultimate approval has to come from Cleveland City Council which has not even considered the option as of yet.
Thirty years of property taxes on a building valued at $250 million -- once completed -- comes in at $126 million.
The school district gets 63 percent of property taxes and the city gets the rest.
For $18 million up front, CMSD is willing to forfeit $79.3 million over 30 years.
The city would lose $47.7 million over 30 years, and not get anything up front like CMSD is getting.
The current parking lot is only bringing in $360,000 in taxes at the current time. The trade off is collecting new income tax on the estimated 3,000 people who would work in the building, along with the retail space and restaurants creating new sales tax money.