#19 So, how's it going?

Transforming Warren

Probably the most oft asked question we've received thus far is, "So, how is the Peninsula Project going?" A simple enough question; but one thing I've learned is that, when it comes to this project, there may be simple questions, but there are very rarely any simple answers.

I'll do my best to answer this one, but, as always, a bit of context is necessary. I will remind you that the sum total of my real estate development experience prior to getting involved with the Peninsula Project was approximately zero. The biggest thing I've learned the past few years is that something of this scale is phenomenally complex.

For example, here is a partial list of the owners of some of the properties we hope to redevelop: the City of Warren, the Trumbull County Land Bank, the Western Reserve Port Authority, Warren Redevelopment and Planning, plus more than a few private owners.

Governments involved: Warren, Trumbull County, the State of Ohio and the Federal government. Non-government organizations: Eastgate Council of Governments, Trumbull Neighborhood Partnership, the Warren-Youngstown Regional Chamber of Commerce, the Trumbull County Land Bank and the Trumbull County Tourism Bureau.

Often, there are different parts to some of these organizations involved in different ways. Let's take the City as an example. City Council has played a major role, as have the Water Department and the Water Pollution Control Department, the Auditor, the Law Director, Community Development, and Engineering and Planning. Not every group we've worked with have this many roles in the projects, but it may give you an idea of how many people need to be in the communications loop.

We must stress that while this might sound like a bureaucratic nightmare, everyone involved — elected officials, managers and employees — have been very helpful. They've all recognized this as a great opportunity for Trumbull County and are working hard to find solutions to problems.

In addition to lots of organizations, there are many external factors in play: the U.S. macro-economy, interest rates and their trends, the local economy, local job growth, local housing sales and occupancy rates, local hotel occupancy levels and room rates, local commercial office occupancy rates and rents. Again, these are just a few of the factors creating either tail winds or head winds.

Mostly, things are going our way. We now own or control most of the property we need for the project. Interest rates are trending down. There is a local shortage of hotel rooms. We have good reasons to believe the number of residential units we project can be easily absorbed by current demand, and demand seems to be on the upswing.

Now, there is an 800 pound gorilla in the room. Everything we need to do costs money, and cumulatively, the Peninsula Project will cost $150 million or more. And we do not have that sum sitting safely in a savings account at the moment. Raising it will take time, and will require multiple, separate fund-raising campaigns to buy property, improve infrastructure, create new streetscapes and build various development phases — a hotel, residential units, office space, a parking deck, a food hall, etc.

So, to answer the question, "How's it going?" we can most accurately reply, "It's going." There have been dozens of hurdles to get over to get to where we are. So far, we've gotten over all of them. There will be dozens more that need to be hurdled before we cross the finish line. We know where they are, and how tall they are, and we are not afraid to run the race.

We are also not running alone; we have a very experienced developer who knows the track well, and we've got some great partners running with us.

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