Welcome to the Business Journal Archives
Search for articles below, or continue to the all new BusinessJournalDaily.com now.
Search
City Moves to Acquire Title to Phar-Mor Centre
"By Dan O'BrienYOUNGSTOWN, Ohio -- City Council last night approved measures that will enable the city to acquire title to the Phar-Mor Centre and pave the way for a new tenant to move into that building.At council's finance committee meeting Wednesday, Finance Director David Bozanich said a deal is in the works that will allow Infocision, a teleservices company based in Akron, to occupy the fourth floor of the building.Part of that deal includes the city obtaining title to the Phar-Mor building with no debt obligations, Bozanich said. The title is currently held by Strouss Business Associates, which is in the process of dissolving. Once that entity dissolves, Bozanich said the city will assume "certain positions," that will allow the city to hold the title, but not the mortgage, and lease the facility to new tenants. "We will have the title, but no debt," he said.In December, the city allocated $850,000 to acquire the land under the Phar Mor Centre, but not the building itself. That deal, Bozanich added, should close soon.Last summer, the city attempted to acquire the title to the Phar-Mor Centre in order to facilitate the relocation of the Mahoning County Job and Family Services Department to the building. That effort, however, was blocked by the Cafaro Co. of Youngstown, sources said, who prevailed upon Bank One, which holds a $2 million mortgage on the building, to nix the deal. Job and Family Services leases space at McGuffey Plaza, which is owned by Cafaro, for which Mahoning County pays the company more than $400,000 a year in rent.InfoCision has said it wants to move in by February and announced last week it could eventually bring as many as 300 new jobs downtown. The company, which is based in Akron, operates inbound and outbound call centers and already has offices in Austintown, Boardman and New Castle.Bozanich reported the prospects of revitalizing and finding a new tenant for the building looked bleak only two months ago, and intimated that if a tenant wasn't secured soon, the building may have to be boarded up. Council, however, favored keeping the building open for as long as possible.Around that time, Bozanich said the city discovered that Infocision was looking for a facility to initially accommodate between 120 and 150 phone operators. "We contacted the company and were successful in convincing them to locate in Youngstown," he said.The project not only salvages the building, it also allows the existing tenants in Phar-Mor to remain downtown, said Mayor George M. McKelvey. "It stabilizes the existing tenants," he said. Tenants such as Strollo Architects, the law firm of Nadler, Nadler & Burdman, Jerry Lee Jewelers and several businesses operating in the building's food court are still located in the building.The mayor also said in the wake of the InfoCision's announcement, other companies and firms located in the suburbs have inquired about incentive packages available through the city. "I hope this project acts as a catalyst and convinces these companies to look at other downtown buildings" that have space available, McKelvey said.InfoCision has requested a standard 75% tax abatement for 10 years on new investment in the downtown operation, expected to be about $1 million. Council also approved the city issuing a $1.2 million bridge loan over 18 months, which the company can use if necessary, and gave the go-ahead for city officials to negotiate a lease agreement with Infocision.Bozanich said the InfoCision project is important for downtown development since the majority of employees work between 8 a.m. and 10 p.m., which can encourage traffic after normal business hours downtown.Contact Dan O'Brien at [email protected]"