Historic Ohio Theater Nears Completion of 25-Year Restoration

Published by Teresa Garcia on Tuesday, February 7, 2017
Journal thumb February 2017

Patrick Crow remembers a time in the early 1990s when his plans to renovate the historic, 65,000-square-foot Woodward Opera House in Mount Vernon, Ohio, seemed infeasible to local residents. It was too overwhelming and too expensive. 

“Then there was an eight- or 10-year period when that changed from, why or how to when are you going to do this?” said Crow, who partly credits Mount Vernon’s participation in the National Trust Main Street America program for the increased local support for historic preservation. Thanks to a large private donation and a mix of historic tax credit (HTC) and new markets tax credit (NMTC) financing, plans to renovate the Woodward Opera House are not only feasible–they’re becoming a reality.

Once completed in December, the Woodward Arts Complex will have updated retail and office space for as many as 29 tenants, a 500-seat theater, two recital and multipurpose rooms, dressing rooms and conference spaces. The Woodward will also be a fresh food hub in what was previously a complete food desert. The property will help alleviate the fresh food shortage by including a café that serves local food and a community kitchen available for local farmers to process or package their produce.

Journal February 2017 - State photo 1

Image: Courtesy of Walter Shockley
Once completed in December, the Woodward Arts Complex in Mount Vernon, Ohio, will have updated retail and office space for as many as 29 tenants, a 500-seat theater, two recital and multipurpose rooms, dressing rooms and conference spaces.

 

History

“In 1850, Mount Vernon was truly a frontier town that was out in the sticks,” said Crow, project manager of the Woodward Development Corporation, the entity in charge of renovating the historic theater. “There were several thousand people who lived in the community, but the town was all wood-framed buildings.” To attract new business opportunities to town, local doctor and real estate developer Ebenezer Woodward built a four-story brick masonry building in 1851 that became known as the Woodward Opera House. 

The first two floors provided retail and commercial leasing space, while the third and fourth floors housed a theater and balcony. Woodward moved the theater to an adjacent building he acquired and connected the two buildings. The former theater space in the original Woodward building operated briefly in the 20th century as a movie house for silent films, but eventually fell out of use. Meanwhile, the second floor retained business tenants until the 1960s and the ground floor has been continuously occupied by restaurants and retailers. The Woodward was added to the National Register of Historic Places in 1975.

Mount Vernon called a community meeting in the early 1990s to decide what should be done with the Woodward. Crow, who was then the downtown manager and the visitors’ bureau director, joined a group of local residents to buy and preserve the historic building. It took Crow and his group six years to purchase the building and a few more to purchase an adjacent building for an annex. After taking another 10 years to complete three phases of a planned nine-phase renovation, Crow realized there was a more efficient way to proceed. “We didn’t have the muscle, the backbone, the fundraising capability to build up the resources to bring this thing into a fully functional theater and conference center,” said Crow. “[Then,] I attended several conferences and started learning about tax credits.”

Renovation

A combination of federal and state NMTCs and federal and state HTCs helped put the Woodward renovation on a faster track to completion and Hardlines Design Company was hired to help with design and planning. “I joke that they picked me because I was young enough then to see it through for 17 years,” said architect Charissa Durst, president of Hardlines Design Company. Durst said that when she joined the renovation team in 2000, the plan was to rehabilitate the building in $100,000 to $200,000 increments because the total budget was only $2 million and tax credits hadn’t yet been considered.

As tax credit financing and private donations helped the budget grow, the scope of renovations also expanded and more historic features could be preserved. Work includes restoring the brick façade, replacing the eaves removed by previous owners and replacing windows that had been previously tampered with. Durst said one of the main challenges was figuring out where to hide a modern mechanical system. Because the attic space in the theater building was too small, architects added a floor to the annex that could house larger air ducts, while keeping in mind that the state historic preservation office would not allow the annex to be taller than the historic structure. 

Financing

For Woodward partners, HTCs and NMTCs were the key to making the renovation possible. “Combining HTC and NMTC in project financing is never easy, and the Woodward was no exception. In fact, this transaction proved one of the most difficult transactions to close–it almost didn’t happen,” said Annette Stevenson, CPA and partner at Novogradac and Company LLP, who worked on the transaction. “Pat and his team worked relentlessly through one challenge after another. Their perseverance was remarkable, and I am honored to have been a part of such an impactful project for the Mount Vernon community.”

“There are a lot of reasons why it’s an ideal project for the New Markets Tax Credit program,” said Tara Hamacher, president of Historic Consultants, who helped underwrite the transaction and find NMTC allocation. “It lent itself to the healthy food program, there’s job creation and it’s in a low-income census tract that serves as a catalytic project. That spoke well to the New Markets Tax Credit program. There’s no other way to fill that gap funding.”

U.S. Bank provided $6 million in federal NMTC equity, $600,000 in state NMTC equity and $4.6 million in federal HTC equity. “This building is what the New Markets [Tax Credit] program and historic [tax credit] program are designed to do,” said Jennifer Sieve Gontram, project manager for U.S. Bank. “This [development] has been decades in the making and it’s going to anchor a corner on a prominent street in this rural downtown. It will really be a long-term source of additional revenue for the community.”

Finance Fund provided $9.5 million in federal NMTC allocation and $2.5 million in Ohio state NMTC allocation for the development’s first closing in September 2015. For the second closing, Finance Fund provided another $9 million in federal NMTC allocation from a different allocation round. Finance Fund also provided a $3.5 million federal HTC bridge loan. 

Journal February 2017 - State photo 2

Image: Courtesy of Patrick L. Crow Jr.
Renovation of the Woodward Opera House complex involves restoring the peaked roofs of the annex building. The original peaked roofs were lost in a fire in the 1940s.

 

Andrew Swary, executive vice president and general counsel for Finance Fund, said that the Woodward investment was attractive because Finance Fund focuses on healthy food initiatives in low-income, rural communities. “Oftentimes there’s a disconnect because local farmers are small operators and it’s cost prohibitive for them to do any kind of distribution directly for low-income communities,” said Swary. “Part of the Woodward Opera House is providing a low-cost alternative for local growers to have accessible packing and distribution [facilities].”

Although using both state and federal NMTCs helped attract more investment to the Woodward, combining the two tax credit programs wasn’t easy. “Adding the state of Ohio new markets tax credit was challenging in that a real estate entity can’t use it; it has to go to an operating business,” said Don Longwell of Longwell Law Firm, who was legal counsel to Woodward Development Corporation. Longwell said the partners found a way to use the Ohio NMTC by using two qualified active low-income business (QALICBs): Woodward Landlord LLC for the federal NMTC and Knox Partnership Arts and Culture Inc., a nonprofit that was leasing space within the property, for the state NMTC. 

Enterprise Community Loan Fund provided a nearly $3 million construction bridge loan for the state HTC investment by Nationwide Real Estate Investments. “One of the things we are keenly focused on is, what are those investments that are going to be catalytic for a particular community or place?” said Lori Chatman, president of Enterprise Community Loan Fund. Chatman said she expects the Woodward will be an important source of jobs and healthy food for the community, especially residents of the several low-income housing tax credit (LIHTC) properties within a 2-mile radius. 

The Woodward also found significant local support. Mount Vernon-based manufacturing company Ariel Corporation and its affiliate, the Ariel Foundation, donated $10 million over 10 years to restore the Woodward Opera House as part of a larger goal to revitalize the downtown area. “Like virtually everywhere in the Midwest, the [Mount Vernon] downtown died with the advent of suburban malls,” said Karen Buchwald Wright, chairman, president and CEO of the Ariel Corporation and founder of Ariel Foundation. “In the ’70s, it was a thriving downtown with three department stores and every kind of store found in today’s malls, but all of that is gone. Part of the overall [revitalization] process has been the restoration of the Woodward.”

Community Impact

About 200 construction jobs and 42 full-time equivalent jobs will be created by the redevelopment, in addition to five full-time jobs retained. About 15 to 20 percent of new full-time jobs are expected to be filled by low-income, local residents. “This is a large project anywhere, but in a town the size of Mount Vernon, this is off the charts,” said Longwell.

After years of hard work, Crow said he’s excited and ready for the grand opening planned for December. “We want to have a month or a two-month long series of events that will showcase everything we can do with this facility,” said Crow. “It’s been our life for 25 years.”