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The project is expected to bring hundreds of residents and more than a thousand jobs to the heart of downtown.

CINCINNATI (WXIX) - A development encompassing an entire block of buildings in the heart of Downtown Cincinnati has secured the last piece of funding needed to move forward, with hundreds of residents and a thousand new jobs expected to follow.

The $132 million rehabilitation project includes the Traction Building at Fifth and Walnut streets as well as two buildings adjacent to the south, the Mercantile Building and the Mercantile Center.

The developers, Cincinnati-based Model Group and Nashville-based Parkes Development, secured $11.7 million this week from Ohio’s new Transformational Mixed-Use Development Program.

“It’s a big day for the center of our downtown,” Model Group CEO Bobby Maly said Friday. “It’s a really big deal. Cincinnati didn’t win an award last time. This is a needle mover.”

Gov. Mike DeWine announced the TMUD tax credits Thursday totaling $100 million across 12 projects throughout Ohio. The projects are expected to catalyze $2.3 billion in investments.

“These projects will transform not only the sites themselves, but also the look and feel of entire neighborhoods,” DeWine said. “We’re changing the face of these communities and bringing Ohio into the future. I’m looking forward to seeing the tremendous change these projects create in their communities.”

The Mercantile Building and the Traction building in Downtown Cincinnati.(WXIX)

Model and Parkes are partnering with the building owners as well as the Cincinnati Port Authority to redevelop the block.

The Port approved the issuance of $55 million in development revenue bonds for the project. The Port’s involvement allows the developers to bypass sales taxes on construction materials.

The Traction Building, a largely vacant eyesore southeast of Fountain Square, will become a 150-room boutique hotel from San Francisco-based Kimpton. Plans initially released in 2017 called for a signature restaurant, a rooftop bar and a fitness center.

Designed by famed Chicago architect Daniel Burnham and completed in 1903, the Traction Building was designated a historic landmark in 2015. Parkes secured $5 million in state historic tax credits for the hotel conversion in December 2021.

Cincinnati City Council approved a 15-year community reinvestment area tax abatement for the Traction Building redevelopment in 2019.

The Mercantile Building is also a historic landmark as of January 2021. Model plans to double the footprint of its primary tenant, the Mercantile Library, which dates to 1835 and is one of the oldest membership libraries in the country.

The Mercantile Center will preserve and condense its existing tenants into into a few floors, reports the Cincinnati Business Courier.

The remainder of the Mercantile buildings will become 172 residential units and ground-floor retail.

The project is expected to bring more than 300 construction jobs and more than 700 permanent jobs to the area.

No word on when rehabilitation work will begin.

Just a few blocks away on 4th Street, the Union Center Life Insurance Tower residential conversion also received TMUD funds totaling $1 million. Construction is underway on the project that will bring 281 apartment units to the building.

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