AKRON—Downtown has had a setback in terms of getting the former Austen BioInnovation Institute in Akron (ABIA) building back into full use. Smithers has confirmed it has canceled its plans to take over the downtown Akron building and do a $16.9 million renovation.
The company, which provides laboratory and testing services for industries ranging from health care to transportation, said it has decided not to use the six-story building at 47 N. Main St. to consolidate its operations. Previous plans called for Akron-based Smithers to renovate and move its headquarters, now at 121 S. Main St., into the former ABIA site, along with a lab now housed on West Market Street and about 200 employees.
Responding to inquiries at the end of January, Smithers issued a statement saying the project was "no longer moving forward due to the impact of COVID-19 on the financial arrangements established as part of the project."
Smithers said in a statement to Crain's: "Despite the best efforts of Smithers, Akron Children's Hospital, the city of Akron and Summit County, the COVID-19 pandemic made the project untenable when everyone's focus needed to be on the health and safety of their employees, clients and communities."
While the decision is a disappointment for some downtown backers, all is not lost, according to Smithers and local officials who had been working with the company.
"Smithers has initiated a comprehensive search for a new campus to bring our Akron-based employees together in a transformational new home designed for agile operations and growth. The strategic reasons for a new Smithers global operations hub remain unchanged," the company stated.
Summit County already is working with the company to find a new site, county chief of staff Brian Nelson said. It would like to see Smithers remain in Akron but, barring that, will work to keep them in the county, Nelson said. However, the county will not offer the company incentives to get it to move from one Summit County community to another, he said.
Smithers' decision to pull out was a disappointment, but not one the county, city and the Development Finance Authority of Summit County (DFA) were unprepared for, Nelson said. All three entities worked with Smithers on the project. The building is owned by the DFA, but it will revert to county ownership if someone other than Smithers wants to purchase it, Nelson said.
"It's disappointing," Nelson said. "We negotiated and worked with them and a number of partners, including the city, DFA and JobsOhio, for two years putting that project together. But all along the way as we worked through how to retrofit that property there were always hurdles. … We always had a plan B, knowing that if for some reason this didn't come off, we'd need to look at other options. So, while it's disappointing, it really doesn't leave us in a worse position. We're already in discussions to do something else with the property."
Nelson and James Hardy, Akron's deputy mayor for integrated development, said the city and county are already fielding inquiries from other interested parties, including one Hardy said is considering buying the building to use as traditional office space.
"The city is aware that the project to put Smithers at 47 N. Main St. in downtown Akron will not be moving forward. … That said, the city is in communication with Smithers to assist in staying and growing right here in their hometown," Hardy said in an email. "Further, we know there is still market interest in 47 N. Main St. from a redevelopment perspective, so we remain optimistic that we can achieve a 'win-win' outcome. We don't have a firm end use just yet, but I am aware of inquiries to repurpose the space for more office use."
The county has already freed up the building by paying off about $6.5 million of debt in the form of a loan from the state of Ohio and some bonds set up by DFA, which were secured by the property. So the building will now be put for sale at a market price, Nelson said. As part of its efforts to incentivize Smithers to move in, the county had agreed to sell the company the building at a discounted price of $750,000, he said.
Nelson, Hardy and DFA president Chris Burnham all said the building, which sits at a prime spot near the intersection of North Main Street and Martin Luther King Boulevard, remains in good shape, and they expressed optimism it will sell.
"You have a building with unbelievable highway access and a 200-space parking lot," said Burnham, who added that he has seen other companies cut back their development plans recently due to the pandemic.
The county now might even get more selling the building at something like its appraised value.
"Now, I think we're hoping to get market rate out of it—the last appraisal that was done was about $4.5 million," Nelson said.
In the meantime, he and other local officials are scouring town for a new potential site that will fit Smithers' needs—not an easy task for a company that needs both a laboratory facility and a lot of space.
"I think what they need is a 60,000- to 70,000-square-foot building … and what they need is very specific. They need lab space for more than half that total space," Nelson said.
The former ABIA building is now about half full. Burnham said it houses the DFA on one of its six floors, while Akron Children's Hospital occupies two others and part of a third. Together, the two take up nearly 30,000 square feet of the 68,615-square-foot building, Burnham said.