Explanation
BACKGROUND: Columbus City Council (“COUNCIL”), by Ordinance No. 2012-2020, passed September 21, 2020, authorized the City of Columbus (“CITY”) to enter into an Enterprise Zone Agreement (the “AGREEMENT”) with HQ Office I LLC (the “ENTERPRISE”), for a tax abatement of seventy-five percent (75%) for a period of ten (10) consecutive years in consideration of a proposed total capital investment of approximately $19,200,000.00 in real property improvements to construct a Class A office building consisting of approximately 141,000 square feet (the “PROJECT”) at 4960 E. Dublin Granville Road, Columbus, Ohio 43081, parcel number 010-301661, within the City of Columbus and within the City of Columbus Enterprise Zone (the “PROJECT SITE”). Additionally, the ENTERPRISE committed to create or cause to be created fifteen (15) net new full-time permanent positions with an associated annual payroll of approximately $750,000.00 at the PROJECT SITE. The AGREEMENT was made and entered into effective December 23, 2020 with the PROJECT expected to begin approximately January 2021, with all real property improvements expected to be completed approximately by January 2022 and with the abatement to commence no later than January 1, 2023 nor extend beyond December 31, 2032 (Agreement No. 023-21-07).
Paragraph fourteen within Section 6 (Program Compliance) of the AGREEMENT states that the “AGREEMENT is not transferable or assignable without the express, written, approval of the CITY” and paragraph fifteen of that same section states that “any requested amendment…to any of the terms of the AGREEMENT…shall require the payment to the CITY by the ENTERPRISE of an AMENDMENT FEE in the amount of five-hundred dollars ($500.00).”
Subsequently, in a letter from HQ Office I LLC received by the CITY dated August 31, 2026, and through ensuing correspondence, confirmed that the ENTERPRISE sold its’ entire interest in the PROJECT SITE to OhioHealth Corporation on August 16, 2026, the date of closing. The transfer of title and ownership was recorded at the County Auditor’s office on August 28, 2026. Consequently, the ENTERPRISE formally requests that the CITY amend the AGREEMENT for the purpose of transferring the tax incentive to OhioHealth Corporation, the new entity that owns the PROJECT SITE.
Due diligence has been undertaken by the CITY in that OhioHealth Corporation agreed to fully assume the terms and commitments of the ENTERPRISE pursuant to the AGREEMENT, has submitted an updated Economic Development Incentive Application and the five-hundred dollars ($500.00) Amendment Fee, and this application and all other pertinent information has been reviewed and vetted.
This legislation is to authorize the Director of the Department of Development to amend the AGREEMENT for the first time for Assignment & Assumption to (1) remove HQ Office I LLC as ENTERPRISE and party to the AGREEMENT and to be replaced with OhioHealth Corporation as ENTERPRISE and party to the AGREEMENT, whereby OhioHealth Corporation will assume the terms and commitments of the AGREEMENT, and (2) to revise the notice information related to ENTERPRISE within Section 6 of the AGREEMENT.
This legislation is presented as 30-day legislation.
FISCAL IMPACT: No funding is required for this legislation.
Title
To authorize the Director of the Department of Development to amend the Enterprise Zone Agreement for the first time for Assignment & Assumption with HQ Office I LLC to (1) remove HQ Office I LLC as enterprise and party to the agreement and to be replaced with OhioHealth Corporation as enterprise and party to the agreement, and (2) revise the notification information related to enterprise within Section 6 of the agreement. ($0.00)
Body
WHEREAS, the City of Columbus (“CITY”) entered into an Enterprise Zone Agreement (the “AGREEMENT”) with HQ Office I LLC (“ENTERPRISE”), approved by Columbus City Council (“COUNCIL”) by Ordinance No. 2012-2020, passed September 21, 2020, with this AGREEMENT made and entered into effective December 23, 2020; and
WHEREAS, the AGREEMENT granted a 75%/10-Year abatement on real property improvements; and
WHEREAS, the incentive was granted in consideration of a proposed total capital investment of approximately $19,200,000.00 in real property improvements to construct a speculative Class A office building consisting of approximately 141,000 square feet (the “PROJECT”) at 4960 E. Dublin Granville Road, Columbus, Ohio, 43081, parcel number 010-301661, within the City of Columbus and within the City of Columbus Enterprise Zone (the “PROJECT SITE”). Additionally, the ENTERPRISE committed to create or cause to be created fifteen (15) net new full-time permanent positions with an associated annual payroll of approximately $750,000.00 at the PROJECT SITE. The AGREEMENT was made and entered into effective December 23, 2020 with the PROJECT expected to begin approximately January 2021, with all real property improvements expected to be completed by January 2022 and with the abatement to commence no later than January 1, 2023 nor extend beyond December 31, 2032 (Agreement No. 023-21-07); and
WHEREAS, paragraph fourteen, within Section 6 (Program Compliance) of the AGREEMENT, states that the “AGREEMENT is not transferable or assignable without the express, written, approval of the CITY” and paragraph fifteen, of that same section, states that “any requested amendment…to any of the terms of the AGREEMENT…shall require the payment to the CITY by the ENTERPRISE of an AMENDMENT FEE in the amount of five- hundred dollars ($500.00); and
WHEREAS, subsequently, in a letter from HQ Office I LLC received by the CITY dated August 31, 2026, and through ensuing correspondence, confirmed that the ENTERPRISE sold its’ entire interest in the PROJECT SITE to OhioHealth Corporation on August 16, 2026, the date of closing. The transfer of title and ownership was recorded at the County Auditor’s office on August 28, 2026. Consequently, the ENTERPRISE formally requests that the CITY amend the AGREEMENT for the purpose of transferring the tax incentive to OhioHealth Corporation, the new entity that owns the PROJECT SITE; and
WHEREAS, due diligence has been undertaken by the CITY in that HQ Office I LLC agreed to fully assume the terms and commitments of the ENTERPRISE pursuant to the AGREEMENT, has submitted an updated Economic Development Incentive Application and the five-hundred dollars ($500.00) Amendment Fee, and this application and all other pertinent information have been reviewed and vetted; and
WHEREAS, a First Amendment to the AGREEMENT is now needed for Assignment & Assumption to remove HQ Office I LLC as ENTERPRISE and party to the AGREEMENT and to be replaced with OhioHealth Corporation as ENTERPRISE and party to the AGREEMENT, and to revise the notification information related to ENTERPRISE within Section 6 of the AGREEMENT; and
WHEREAS, the Director of the Department of Development of the CITY has investigated the Economic Development Application of OhioHealth Corporation and concurs with the Columbus City Council on the basis that OhioHealth Corporation is qualified by financial responsibility and business experience to create and preserve employment opportunities in the Columbus Enterprise Zone and improve the economic climate of the CITY; and
WHEREAS, it has become necessary in the usual daily operation an amendment for Assignment & Assumption to the AGREEMENT with HQ Office I LLC to (1) remove HQ Office I LLC as ENTERPRISE and to be replaced by OhioHealth Corporation as ENTERPRISE and party to the AGREEMENT, whereby, OhioHealth Corporation will assume the terms and commitments of the AGREEMENT, and (2) revise the notification information related to ENTERPRISE within Section 6 of the AGREEMENT; and NOW THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That the Council of Columbus finds that the enterprise submitting this proposal is qualified by financial responsibility and business experience to create and preserve employment opportunities in the zone and improve the economic climate of the municipal corporation.
SECTION 2. That the Director of the Department of Development is hereby authorized to amend the City of Columbus Enterprise Zone Agreement with HQ Office I LLC (the “AGREEMENT”) to remove HQ Office I LLC as ENTERPRISE to be replaced with OhioHealth Corporation as ENTERPRISE, whereby OhioHealth Corporation will assume the terms and commitments of the AGREEMENT as ENTERPRISE.
SECTION 3. That the Director of the Department of Development is hereby authorized to amend within Section 6 (Program Compliance) of the AGREEMENT, the “if to the ENTERPRISE” section regarding written communication from HQ Office I LLC to OhioHealth Corporation C/O Maggie Pope, Vice President, Real Estate, 3430 OhioHealth Parkway, Columbus, Ohio 43202.
SECTION 4. That this FIRST AMENDMENT for Assignment & Assumption to the City of Columbus Enterprise Zone Agreement be signed by OhioHealth Corporation within ninety (90) days of passage of this ordinance, or this ordinance and the incentive authorized herein shall be null and void.
SECTION 5. That this Ordinance shall take effect and be in force from and after the earliest period allowed by law.