Developer discovers land for Marina plan is leased

1/9/2013

A 5-month-old plan for an East Toledo entertainment district has been dealt a setback with the revelation that property coveted by the district's developer has been leased to someone else.

But the developer, Frank Kass of Columbus, and the companies involved are optimistic the lease deal won't kill the Marina District development. And Mr. Kass said he doesn't blame anyone but himself for the confusion.

“This is a setback,” he said yesterday. “We need to work around this and figure out what to do about it. To talk about anything more than that will make good news but won't get the project completed.”

Mr. Kass is trying to develop a 125-acre complex, dubbed the Marina District, with a new sports arena surrounded by restaurants, apartments, and a movie theater. It would be on land between the Martin Luther King, Jr., Bridge and the new I-280 bridge.

A key to the project is finding a home for a business that is now on part of that stretch - the George Gradel Co. Mr. Kass said he thought he had the answer: a parcel owned by the Toledo-Lucas County Port Authority about a mile downstream from the proposed Marina District.

The 67-acre site is leased by Heidtman Steel Products, Inc., and the company has searched for someone to take over its lease. John Gradel, Gradel's owner, had picked the Heidtman site as his first choice.

Mr. Kass's firm - Continental Real Estate Companies - had been discussing the concept with port authority staffers since the summer. Continental made it official in a Dec. 20 letter to port authority President James Hartung, asking the agency to amend the lease so Continental could take over 46 acres of the property.

But the port authority did not have the power to amend the lease without the approval of Heidtman, and Heidtman officials - unaware of the letter - were negotiating final details with construction firm E.S. Wagner of Oregon.

Heidtman and Wagner signed a deal Thursday for 37 of the 46 acres Mr. Kass wanted. Both firms declined to release details.

Mark Ridenour, Heidtman's chief financial officer, and Bill Hodges, Wagner's vice president, said they knew that Mr. Kass had an interest in the property, but they didn't know about the Dec. 20 letter. Still, they said, it wouldn't have made a difference.

Mr. Hodges said his firm met with Mr. Kass in July about his plans for the parcel, but he never returned calls as he had promised, so they stopped worrying about his plans and concentrated on the firm's own needs.

“We're sorry that there's some flak that's occurring,” Mr. Hodges said. “But we can't sit back and wait for other people that don't have firm commitments.”

Mr. Hodges said his firm has been talking to Heidtman about a sublease since mid-1999. Wagner likes the plot because of its river access and proximity to I-280, particularly because Wagner expects to help build the I-280 bridge. The company plans to add 5 to 10 full-time employees at the site.

He said there may be room for Gradel there, even though Gradel and Wagner are competitors.

“There's an age-old saying, `Don't let your money get mad,'” Mr. Hodges said. “If [Mr. Kass] comes in and says, `We need 37 acres and 100 percent river frontage,' that's not going to fly. But if there's a compromise that's viable, we're willing to talk.”

Mr. Ridenour said the deal allows Heidtman to keep its office building and parking lot there. Gradel could take over that building and lot as part of any deal. “We believe all the parties can be happy on this site,” he said.

The Blade had obtained a copy of Continental's Dec. 20 letter to the port authority last week and detailed Mr. Kass's plans in a Friday article.

Mr. Ridenour said he did not reveal the sublease to a Blade reporter during a Thursday interview, hours after the lease was signed, because he wanted to tell the port authority first. He said he told agency officials Friday.

Mr. Hartung, port authority president, was unavailable yesterday. Agency spokesman Brian Schwartz said Mr. Hartung is attending an American Association of Port Authorities meeting in the Netherlands.

Mr. Schwartz said the agency was unaware of the Heidtman-Wagner deal until after it was signed.

So long as Heidtman “retains all the obligations” of its lease, the port authority has no power to kill the deal, he said.

Mr. Kass said he'll study other alternatives for moving Gradel and doesn't think the setback will delay the Marina District. He blames no one but himself for the setback.

“It's my project. It's going to be a great project, and I'm going to get the credit for it, aren't I?” he said. “And when things don't go well, I've got to take the blame.”