Alternative 1: A Partial Anchor Retention

This alternative proposes a redevelopment concept that retains portions of the existing Towne Mall with at least one anchor. The site design is revised to allow for the redevelopment of the frontage of the site with new outlot developments and improved design features including a boulevard, multipurpose recreation paths, landmark features and a central /park plaza area to accommodate outdoor venues and activities.

Key recommendations include:

2. Create a plaza and outdoor gathering space to provide a terminal vista for the axis oriented to increase visibility for the retail development from Ohio 122 that would also include landmark features in plaza design.

3. Establish a new large format entertainment or destination use like a movie theater to serve as a recreational draw to the site and support the retail development.

4. Provide small format retail spaces as part of the site redevelopment. Businesses should be oriented toward the south and incorporate opportunities for outdoor space associated with uses.

5. Encourage development with restaurant or hospitality uses. This location could support office, research facilities, restaurants, or retail. If a hotel is established in this area it would be best supported with an event venue like a convention/conference center on the other portion of the site.

6. Provide a large public open space to create a vista running north-south to improve visibility from Ohio 122 to the reformatted retail. Include facilities in the open space for outdoor events like concerts, farmer’s markets, and festivals as well as walking and biking. Use this area to serve as a key pedestrian and bike connection in the center of the site.

7. Encourage a large format cultural destination use that will employ signature architecture. Appropriate uses in this location include a college branch location, performing arts theater, conference center, or a large format research or office complex. A destination lodge could also be an appropriate use of this portion of the site.

8. Promote development of additional small and medium format retail to support the reformatting of Pendleton Circle into a landscaped thoroughfare rather than an access drive. This would allow the Sears store to maintain dual entrances from the north and south facades.

Alternative 2: A New Urbanist Town Center

Alternative 2 proposes to clear the site of the Towne Mall and create a new urbanist-style town center with a new site design and building configurations.

The proposed concept includes a central intersection that effectively divides the site into quadrants. This alternative also includes a pedestrian component that extends out of the study area to the northeast to Dixie Highway.

The alternative is pedestrian oriented and should be designed with human scale architectural features. The central uses should be a vertical and horizontal mix of retail, restaurant, office and services with potential upper story residential, based on market demand. Buildings should be of a moderate scale, but include multiple floors. The site should also accommodate civic or destination uses.

Key recommendations include:

2. Create a dual purpose open space to buffer residential development from service areas and provide stormwater management facilities.

3. Include small scale freestanding structures to accommodate retail, office and service uses, or possible hotels, near the perimeter of the site. Buildings should be oriented to the new internal streets.

4. Encourage vertically mixed-use structures with pedestrian friendly architecture that create the feel of a traditional main street district. The buildings could accommodate retail, service, office and residential uses. Parking should be provided in rear parking lots or in structured parking.

5. Encourage a unique or destination use that features signature architecture: Potential uses include a conference center, branch college, civic building, performing arts theater, research and development facility or destination lodge.

6. Develop a well landscaped boulevard as a central access street for development, include street trees, decorative lighting and furniture to accommodate pedestrians and bicyclists. Orient entrance ways and street level activities toward this boulevard.

7. Provide well landscaped surface parking lots and additional screening between parking lots and Ohio 122.

8. Create multi-purpose open spaces such as plazas and small parks where events such as farmer’s markets, concerts or festivals could be held, and daily activities, like outdoor dining areas or recreation, can be accommodated.

Alternative 3: Mixed Use Lifestyle Center

Alternative 3 proposes a redevelopment of the site into quadrants. The front two quadrants would be dedicated to medium and large format retail with outlot sit-down restaurants. The rear and east quadrant would be dedicated to destination uses or hospitality and office, with opportunity for a small conference center and adjacent hotel. The northwest quadrant would be dedicated to a mix of townhouses and multi-family housing into a traditional style neighborhood. All of the quadrants would be centered around a central roundabout with a park or green.

Key recommendations include:

2. Create a central park and green focused around a square or roundabout, to add a focal point to the site and provide open space for the residential and hospitality uses.

3. Create landscaped boulevards with lawns, street trees and sidewalks or multi-use paths.

4. Encourage a business-class hotel/conference center with extensive landscaping of the site.

5. Encourage a medium to large format cultural destination use that will employ signature architecture. Appropriate uses in this location include a college branch location, performing arts theater, conference center, or a large format research or office complex.

6. Allow for one or two large format retail uses between 40,000 to 80,000 square feet to anchor a shopping center. The rear facades may face Ohio 122, but landscaping should be used to soften the view, and the facades should be completed of high-quality materials on all four sides to present a finished appearance to the road.

7. Allow for outlot development for restaurants, and encourage sit-down restaurants or outlot retail.

Regardless of how you may or may not feel about the current situation at the Towne Mall and the city's leadership in making long-term decisions about its future, everyone should have an opinion/preference.

THE QUESTIONABLE PROBABILITY OF ECONOMIC REDEVELOPMENT IN MIDDLETOWN??  WALL STREET JOURNAL - BUSINESS - JULY 20, 2009

Commercial Loans Failing at Rapid Pace

By LINGLING WEI and MAURICE TAMMAN

U.S. banks have been charging off soured commercial mortgages at the fastest pace in nearly 20 years, according to an analysis by The Wall Street Journal. At that rate, losses on loans used to finance offices, shopping malls, hotels, apartments and other commercial property could reach about $30 billion by the end of 2009.

The losses by regional banks on their commercial real-estate loans will be among the most watched details as thousands of banks report second-quarter results over the next two weeks. Many of the most troubled banks have heavy exposure to commercial real estate. So far, 57 banks have failed this year.

The $30 billion estimate is based on financial reports filed by more than 8,000 banks for the first quarter. The trend continued as a handful of major banks reported second-quarter results, including Goldman Sachs Group Inc., J.P. Morgan Chase & Co. and Bank of America Corp. Regional banks tend to have higher exposure to commercial real estate than these big financial institutions.

The commercial real-estate market, valued at about $6.7 trillion, represents 13% of the U.S.'s gross domestic product. But the recession and scarce credit are pushing more commercial developers and investors into default. Meanwhile, property values continue to decline, and banks are required to record a loss on any troubled real-estate loans where the appraised value falls below the amount owed.

Delinquencies on commercial mortgages held by banks more than doubled to about 4.3% in the second quarter from a year earlier, Foresight Analytics estimates. Rep. Carolyn Maloney (D., N.Y.), who heads the House's Joint Economic Committee, said she is working with Treasury Department officials on a plan to try to head off rising defaults on commercial mortgages before they cascade into a crisis.

In contrast to home loans, the majority of which were made by about 10 lenders, thousands of U.S. banks, especially regional and community banks, loaded up on commercial-property debt.

Ironically, small banks appear to be much less aggressive in recognizing losses than their bigger brethren. According to the Journal analysis, the largest banks, with assets of more than $100 billion, saw charge-offs roughly quadruple last year, while losses at many medium-size banks grew at a much smaller rate of 120%.

One monument to both the excessive froth of the real-estate boom and the morning-after headache setting in for lenders is the landmark Equitable Building, rising 33 stories above downtown Atlanta.

In 2007, San Diego real-estate firm Equastone LLC paid $57 million for the office tower and took out a $51.9 million mortgage from Capmark Bank, a Utah-based unit of Capmark Financial Group Inc. in Horsham, Pa. Equastone planned to expand the tower and attract a tenant with pockets deep enough to rename the building.

Shortly after the purchase, the economic slump pushed vacancies higher and rents down. In April, Capmark Bank foreclosed on the building after Equastone defaulted on the debt.

In June, the Equitable Building was sold in a foreclosure auction for $29.5 million, 43% less than the original loan amount. And the buyer? It was 100 Peachtree Street Atlanta, a company formed by Capmark Bank for the purpose of acquiring the building. There were no other bidders.

Steven Nielsen, Capmark Bank's chief executive, said the mortgage was written off to the "estimated value" of the building. He wouldn't specify the size of the related charge-off on Capmark's books. Property-tax records show the building was valued at about $44.8 million at foreclosure, which would equal a $7.1 million loss for the bank.

Some bankers say they feel growing pressures from regulators to take losses on commercial real-estate exposure as a way of reducing the possibility of a catastrophic hit later.

"We recognize losses as quickly as any bank, partly because bank regulators dictate that," said Ed Garding, chief credit officer at First Interstate Bank, of Billings, Mont. More than 40% of the bank's loans are in commercial real estate, but according to the Journal analysis, annualized charge-offs in 2009 would be just 3% of its nonperforming commercial mortgages as of the end of 2008. That compares with an average of 34% for all U.S. banks.

Mr. Garding said the commercial real-estate market has held up relatively well in First Interstate's markets in Montana and Wyoming. Meanwhile, "we're strongly collateralized so the loan doesn't result in a loss," he added.

Among other banks with notably low charge-offs: Based on the Journal study, annualized write-offs this year would be only 9% of all nonperforming commercial mortgages at a Wachovia Corp. unit in Charlotte, N.C. A spokeswoman at Wachovia declined to comment.

At New York Community Bank, a New York State-charted savings bank, that ratio would be a meager 2% in the first quarter. Ilene Angarola, director of investor relations at New York Community Bancorp., the bank holding company, credited the bank's strong underwriting standards. "Even though we have seen a decline in property values, our loan-to-value ratio is conservative enough that we haven't experienced anywhere near the degree of the charge-offs our peers have experienced," Ms. Angarola said.

Some analysts, meanwhile, worry that banks aren't sufficiently recognizing losses on their commercial real-estate loans, thereby exposing themselves to bigger losses later. According to Deutsche Bank AG, since the beginning of last year, the amount of charged-off commercial mortgages as a percentage of such debt outstanding has ranged from a high of 3.2% to as low as 0.3%.

"Net charge-offs to date have been highly inadequate," said Richard Parkus, head of commercial mortgage-backed securities research at Deutsche Bank. "This is clearly a problem that is being pushed out into the future."

How aggressively regulators respond could help determine how long the commercial-property market remains mired in turmoil. "If banks are allowed to bury problem loans away in their portfolios for years via massive term extensions, this is likely to be a very long process," Mr. Parkus said.