Columbus Monthly / May 2010 / Hilliard: Accelerated Development

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Hilliard: Accelerated Development

Hilliard’s fields of green also are fields of dreams for the city’s economic development strategy: If you build it, they will come.

The “it” is infrastructure. Simply put, Hilliard is the last greater Columbus suburb with substantial developable greenfield commercial real estate fronting Interstate 270. What’s more, there’s still significant acreage beyond the I-270 gateway.

In recent years, the city has aggressively set to marketing economic development opportunities with the lure of brand-new infrastructure, creating major roads from scratch and extending utilities to access vast parcels for mixed-use commercial development, surrounded by Hilliard’s populous residential neighborhoods. The investment is rapidly changing Hilliard’s reputation from a bedroom community to a self-sustaining economic engine among Central Ohio cities.

Hilliard began a journey to build up commercial development access within city limits in the early to mid 2000s in conjunction with economic development director David Meeks’s arrival on the job in 2002. The city already has completed two major north-south connectors that have helped extend regional development from Hilliard’s neighbor to the north, Dublin.

“When I got here, the biggest issue facing Hilliard was that we had tremendous amounts of land, but we had no roads, no infrastructure to any of it,” Meeks says. “Beginning with 2004, we really began to make a commitment to get infrastructure access into all of these areas.”

Britton Parkway has essentially enabled Hilliard to claim another I-270 exit at Tuttle Crossing, and has created a direct connection to Dublin’s Emerald Parkway, Meeks says. Furthermore, the parallel Trueman Boulevard on the east side of I-270 in conjunction with the southern portion of Britton dramatically expands northbound access from the Cemetery Road interstate exit and the Mill Run mixed-use commercial area shared with Columbus, creating new opportunities within just the last few years, he says.

The secret to successful and rapid infrastructure building has been partnerships with developers, Meeks says. The city paid $7.5 million for a private developer’s construction of the southern half of Trueman, completed in 2003, versus a city estimate of $11 million to take on the project, Meeks says. It purchased the northern half for $4.5 million under a similar agreement through city-issued bond financing.

Hilliard also issued city bonds for approximately $10 million to construct the northern portion of Britton Parkway between 2004 and 2006, in conjunction with development of the North American headquarters of BMW Financial Services within the city, Meeks says. The final portion of Britton, between Davidson and Cemetery roads, was completed in 2009 with $19 million in bonds issued by the now-defunct Hickory Chase retirement complex, he says.

Trueman Boulevard alone has been responsible for driving $70 million to $80 million in new commercial development in Hilliard, Meeks says. Originally designated for mixed use, the 100 acres along Trueman have been going quickly, primarily for medical office development and the regional headquarters of Easter Seals. The road also significantly improves access and visibility to longtime Hilliard business giant Advanced Drainage Systems near Trueman and Davidson roads, Meeks says.

Now, the city wants to take its playbook to the west side to score again with the creation of Alton Commons Parkway. The new road would cut a swath through more than 150 acres of privately owned agricultural land and city-held recreation property, relocating and doubling in size Hilliard’s soccer park to 60 acres and creating 80 acres for commercial development, says project developer Frank Petruziello, partner with Skilken. The Columbus developer already has created a CVS-anchored mixed-use center at Cosgray and Scioto Darby roads on the northern border of the planned Alton Commons development area.

Skilken, which has as extensive history of CVS- and Kroger-anchored developments, will be catering to the growing interest in medical commercial development throughout Hilliard with the Alton Commons buildout, Petruziello says. Skilken already has planted the flag with its Darby Town Center, which was originally planned for traditional mixed use but attracted most interest in medical office development, he says.

That’s music to Meeks’s ears. “On a square-foot basis, we tend to get more income tax out of medical development than we do anything else. They tend to be a little more stable, too,” he says. The Altercare of Hilliard Post-Acute Center, for instance, opened on Trueman Boulevard in February 2009. The 72-bed rehabilitation center specializes in short-term orthopedic care.

Although Hilliard’s hopes for the establishment of a high-end retirement complex in Hickory Chase have been temporarily put on hold with the default of the project by its developer, Meeks says once the completed property emerges from bankruptcy proceedings, it will quickly attract a new investor. Meeks says he’s confident Hilliard is creating a destination for assisted senior living that will cater to aging baby boomers. A new 100-bed facility is going up on Davidson Road, he says, and another developer is pursuing a 150-apartment, age-restricted complex for seniors that would be adjacent to the Skilken project.

Enterprising efforts

Meeks says he’s always ready to make a deal to attract business investment in Hilliard. “I’ll do tax incentives all over the city,” he says. “Every developable area is a Community Reinvestment Area. That allows the city to control its own abatements.” Although Hilliard favors discounts on income tax to outright abatements in order to support infrastructure development, Meeks says he is willing to be more aggressive to encourage redevelopment of sites such as Mill Run’s vacant K-Mart and the former Dana Corp. production facility.

Andrew Jameson, principal and senior vice president of the office services group with commercial brokerage Grubb & Ellis I Adena Commercial, says Hilliard’s willingness to move quickly on incentive offers has helped lease up the 175,000-plus-square-foot One Mill Run office building, originally occupied by Nationwide’s Gates McDonald and, with construction in 1989, one of the city’s earliest major commercial developments. When Gates McDonald completed its move out several years ago, occupancy reached a low of 17 percent, says Jameson, who has listed the property for five years.

In addition to building upgrades put in place by new ownership, Jameson says the city’s partnership has been integral to closing deals at the property. “We attach an incentive letter to any proposal that we send out,” Jameson says. With 15 tenants led by payroll administration company TALX Corp. and Sedgwick Claims Management Services, less than 40,000 square feet now remain available, he says.

Prospective businesses appreciate the attention, Jameson says. Meeks and Mayor Don Schonhardt will attend showings and offer more than tax breaks, he says. “They ask, ‘How can we help you out in other ways? How can we help you market what you’re doing?’ If it’s a service that the city of Hilliard needs, they make sure that they try to do service with [a company] in Hilliard. That really sets you apart.”

Meeks says on average, an incentive agreement discounts approximately 23 percent of payroll tax for seven years, in the form of an annual grant to a company.

Supporting growth

“Hilliard has managed to do extremely well, especially in a tough economy,” says Mike Smith, vice president of business communications solutions for Verizon, which runs a network operations hub and a range of corporate functions from the former CompuServe headquarters at Davidson Road and Britton Parkway. Verizon currently has approximately 500 employees at the Hilliard property, with capacity for more than 1,000, Smith says. With room to grow, the company-owned building could host spillover Verizon Wireless employees as Dublin office space exceeds capacity, or attract a co-tenant, he says.

“The mayor personally has made it very clear over time to me and to others that [the city] is very willing to sit down and work with Verizon to do whatever they can do to encourage growth of the use of the facility,” says Smith.

“Any number of industries would find Hilliard an attractive place to reside,” Smith adds. “What’s really appealing about the city is the fact that there’s opportunity for continued growth.”

Bob Fresco, vice president of operations for radar instrumentation manufacturer Star Dynamics Corporation, says Hilliard’s industrial property proved the best match for the defense and weapons program support company, which spun off from Powell-based Aeroflex operations in 2007.

Star Dynamics needed square footage to house its instrumentation manufacturing, as well as sufficient parking to accommodate its 85 employees and to support future growth. Hilliard came up on the top of the list of available properties, Fresco says.

Not only has Star Dynamics taken advantage of city incentives supporting its anticipated creation of 70 new jobs, Meeks has gone out of his way to find other means of support for the company, Fresco says. “We were able to put in a machine shop with Ohio Third Frontier grant money,” a $100,000 win the company would not have known to pursue without Meeks’s connections to state development officials, he says.

The fact that Hilliard is the site of the Franklin County Fairgrounds also offers possibilities for future growth. Meeks sees great potential in attracting convention and visitors business that would drive new hotel and retail development in the city. Hilliard is working closely with the All American Quarter Horse Congress, for example, to bring part of its annual Columbus conference to the fairgrounds, Meeks says. A joint feasibility study on a new 2,500- to 3,000-seat arena at the site is ongoing. A new arena would encourage additional year-round use of the fairgrounds, Meeks says. “It’s almost 85 acres of prime land.”

Evolution of the city

Libby Gierach has worked with the Hilliard Area Chamber of Commerce for 17 years, the last 10 as president and CEO. Hilliard has become a top regional destination for business investment, she says.

Gierach advocates a strong network of support for businesses operating in Hilliard to attract them to and keep them in the city. The chamber is seeking out ways to nurture and grow the tech community, and is beginning talks with regional tech accelerator TechColumbus toward partnership initiatives, she says.

Gierach says Hilliard is attracting its share of large corporate tenants, but small business remains an important component of the community as well. Old Hilliard in the city center, where many multigeneration family businesses operate, saw completion of a new streetscape in spring 2009 and will be the home of a 9/11-commemorative First Responders Park Memorial. These assets will help bring consumer traffic to businesses in the area, she says.

The “small-town feel” is attractive to the business community as well as residents, Gierach says. “It’s a very friendly community, in terms of its people who both live and work here.”

Brent Wilder is a freelance writer in Columbus.