1425 – 1437 Market Street CONTENTS

INVESTOR PROSPECTUS WHEELING WV

1 WHEELING CONTEXT

2 BUILDING ON MOMENTUM

3 1425 – 1437 MARKET STREET

4 INCENTIVE POTENTIAL

5 FINANCIAL MODEL

Click on the title to jump to the section WHEELING CONTEXT 1 The birth place of West Virginia and The First State Capitol. Located on I-70, 55 miles southwest of Pittsburgh,120 miles east of Columbus, Ohio, and 130 miles south of Cleveland, Ohio. Wheeling is the largest city (population 27,052) in the Wheeling-Belmont County (Ohio) Metropolitan Statistical Area (population 138,948) that includes Ohio and Marshall Counties, WV, and Belmont County, OH.

Pittsburgh

Wheeling Columbus From the region’s largest trail system, to national schools of excellence, to a reorganized municipal government, the City of Wheeling offers a dynamic environment for future economic growth and development.

There are many features that are unique to this area and we are proud of them! Our businesses enjoy the business climate as well with our advanced, motivated work force. The work force also enjoys being active in our various professional organizations. The area boasts year-round entertainment, leisure, sports, music, festivals, dining, shopping, and much more.

Who We Are We are hardworking, dedicated people who enjoy an unrivaled quality of life. From our nationally ranked schools to award-winning hospitals, Wheeling is an exceptional place to raise a family. There are a plethora of year-round recreational activities including golf, boating, water sports, snow skiing, biking, hiking, tennis, skateboarding, swimming, and many more. Year-round entertainment is another amazing feature of the city including local, regional, and national concert series, festivals, pro sporting events, or try your luck with all of your favorite slots and table games. Wheeling is your place.

Where We’re Going As we move progressively forward, we aspire to be the business, entertainment and cultural center of the Ohio Valley. City Council and partners Regional Economic Development Partnership, The Wheeling Area Convention and Visitor’s Bureau, Wheeling National Heritage Area Corporation, Wheeling Heritage, The Chamber of Commerce, and others are diligently working to reinvent our downtown area. This is an exciting project with unprecedented development and growth potential.

U N N A M WHEELING ATTRACTIONS E D _ 1 6 R 0 E V ! I P Commerical Recreation R

V I W 1. Capitol Theatre R IL LOW SP RIN GS 2. Centre Market 3. Towngate Theatre & Cinema U NN AM ED 4. Oglebay Park _1 60 5. Oglebay Park Golf Club 6. Oglebay Park Good Zoo 7. Victoria Theater 8. WesBanco Arena 9. Wheeling Island Racetrack & Gaming Center 10. Wheeling Country Club

P! Cultural Recreation CLEARVIEW 1. Artworks Around Town 2. B&O Building

«¬2 3. Challenger Learning Center 4. Children’s Museum of the Ohio Valley 5. Eckhart House 6. First State Capitol 7. Kruger Street Toy & Train Museum

28TH 8. Oglebay Institute Museums 9. Smart Center

N R

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S 10. Stifel Fine Arts Center

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L 11. Suspension Bridge 27TH E D

E 12. West Virginia Independence Hall

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L E 13. Wheeling Artisan Center A

B 26TH N A

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N H L 5T 2 G Z P Institutional Facilities

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L DROP A 2. Ohio County Public Library Roads N 23RD GOLDE RD 3. WV Northern Community College 23 V H

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Z S C 4. Wheeling Island Stadium L S E 22ND E

Interstate & Highway T 22ND

T 21ST River & Creek 20TH Note: Not intended as an exhaustive list of local attractions.

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Incorporated Places 11TH 10TH

9TH POGU ES RU County Boundary 8TH 8TH N

7TH Park and Recreational Facilities SIXTH

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A J BENWOOD BUILDING ON MOMENTUM 2 ECONOMIC ANCHORS & RECENT / PLANNED DEVELOPMENT Downtown Streetscape Project

❖ UPGRADED INFRASTRUCTURE ❖ IMPROVED SAFETY ❖ ENHANCED STREETSCAPE EXPERIENCE

This transformative project is a partnership between the WVDOH and the City of Wheeling that will upgrade West Virginia Route 2 on both Main Street and Market Street in the City of Wheeling. Improvements include repaving the streets, new sidewalks and curb ramps to be ADA accessible, as well as installing new traffic signals.

SUBJECT AREA

3 1425 – 1437 MARKET ST RENDERING SOURCE: Building Condition Report (2013) prepared by Schamu Machowski Greco Architects for Wheeling National Heritage Area Corporation

A DOWNTOWN DESTINATION

Located in the heart of Wheeling, the 1400 block of Market Street is accessible to a variety of attractions, amenities, and residential developments. The subject properties provide an opportunity to establish a downtown destination which supports surrounding economic anchors, benefits from prominent historic architecture, and builds upon the development momentum of downtown Wheeling. Historic Significance of 1425 -1437 Market Street

The four buildings included within this RFP are of interest as candidates for a redevelopment project. They are each considered to be significant as contributing to the historical/architectural ambience of the nationally recognized Wheeling Historic District.

The building furthest to the north in this group, 1425 Market Street (currently the Sportsman Club), may be the oldest building in the set. This brick Victorian/Neo- Classical building was probably built in the mid 1880s; Wheeling City Directory listings show that a building at that address was the Standard Cigar Works and residence of Charles Hanke (1836-1897) as early as 1884. Hanke’s widow Hannah remained living at the address until her death in 1904. Saloons owned by Charles Krueger and Frank Greer (1907-09 City Directory listing) and Leonard Drake (1911-12) operated in the building before Prohibition. The Capitol Car Company advertised Maxwell, Columbia, and Chalmers autos at this address for the next few years, followed by use of the building as the Manhattan Hotel until the mid 1930s. A photo from the 1940s includes signs for the Arlington Hotel (with “steam heat,” entrance on the north end of the building) and State Auto Supply (on the south end). Listing as the Sportsman Club began in 1951, and the first floor of the building has housed a bar since then, with the upper floors abandoned.

The five-story building at 1429 Market Street is of interest both architecturally and historically. It is one of the few Flemish-style buildings in the city, and it was once home to one of the more well known properties operated by Wheeling’s underworld chief, Bill Lias. City Directories from as early as 1882 show the property being used as a “steam dyeing, scouring and repairing” concern operated by Charles Neuman. An early advertisement offers cleaning of lace curtains and “remodeling” of silk, felt, and straw hats, along with “merchant tailoring.”

Charles Bauer operated a saloon at the address as early as 1901, and the Bader & Mauer Saloon and Restaurant (Killian Bader and Phillip Mauer) was in business as of the 1903- 04 City Directory. At some point, hotel rooms were made available in the upper floors, and a sketch of the building from a 1903 advertisement shows a “Rathskeller” wrapping around the back of the main building. [Note: the small building visible to the south – left side of the sketch – was apparently demolished to make room for the current buildings at 1431 and 1437 Market.]

Subsequent saloon owners at the address were the Finnegan Brothers (John J., Thomas E., F.A.) and the Kurutz Brothers (Stephen Kurutz). After Prohibition began in West Virginia in 1914, the hotel listings remained in the upper floors, and the Washington Restaurant occupied the first floor. With the repeal of Prohibition in 1934 came a change in the restaurant’s name to the “New Washington Restaurant,” managed by Mrs. Laura Schultz.

The most notable period in the building’s history was in the 1940s, when the building housed Zellers Steak House, owned by “Big Bill” Lias. Legend has it that staff members at the restaurant/casino wore tuxedos and that the big-spending diners could play poker, craps, roulette, baccarat, twenty-one, and a traditional Greek dice game called barboot. It has apparently remained in use as a bar since that time, primarily under the ownership of the George family, with a jazz club occupying the rear (“Rathskeller”) portion for a few years.

The currently empty, 3-story Victorian/Neo-Classical building at 1431 Market Street was probably built in the early 1900s. Merchant tailor August C. Schneider (1864-1945) lived at 83 16th Street and rented out apartments on the upper floor of his Market Street business. The Wheeling Candy Kitchen is listed at this address beginning as early as 1919, surviving as a business, both during and after Prohibition, well into the mid 20th Century. Various tenants lived in the upper floors. The building’s most recent use was as a bar.

Another turn-of-the-20th-century building is located at 1437 Market Street. In its early years, the building housed saloons and restaurants under various ownerships and management (A. C. Miller, Widow Mary Miller, Charles F. Held, and William Boadwing and Herman J. Schneider). After Prohibition began, Harry Paradise operated the Mecca Restaurant – featuring “soft drinks” and cigars – at this address. Following a few years as a clothing store, new owners Sophia and Clarence Fette (widowed mother and son) began Fette’s News Depot in about 1932. The building remained in the Fette family until 1971 and still serves as a retail outlet for print (and other) materials, although certainly not of the caliber of the earlier news outlet.

Prepared by Friends of Wheeling August 31, 2013

Sources: • Deed records – various years. • Fetherling, George. Wheeling: A Brief History, 2008. Polyhedron Learning Media. • National Register of Historic Places Inventory – Nomination, 1978: http://www.wvculture.org/shpo/nr/pdf/ohio/79002597.pdf • Wheeling City Directories – various years Source: 2013 Building Condition Report 1437 Lv 2 1780 sf 1437 Market

□ 1429 Rear Lv 2 □ 2474 sf Lv 2 +14'-10" 1433Ls 2 , 1L- 1433 Market 1595 sf {-ul==-( □ ! /II � �nt=i'rrmnrr upftffifl11111 lttffion

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1429 Market Lv 2 +16'-6" 1429 Lv 2 1895 sf Up i ·1111111111111Htffion �ffiffl I I I Iv 2:

Lv 2 + 12'-5 1/2" 1425 Lv 2 1425 Market 1232 sf □ c � 1111111tttt0n UptttW I n r L______�

LEVEL TWO SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ 1437 Market 1437 Lv 3 1780 sf

□ D D Lv 3 +26'-10" 1433 Market 1433 Lv 3 1216 sf

1429 Market I.I Lv 3 +29'-0" 1429 Lv 3 1720 sf nc upfffffl 111½1111mf+ on Lv 3 +24'-2 1/2" 1425 Lv 3 1232 sf

1425 Market �---,

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LEVEL THREE SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ 1437 Market nil 1437 Lv 4 320 sf

D D 1433 Market

1429 Market Lv 4 +41'-0" 1429 Lv 4 1720 sf

1425 Market

LEVEL FOUR SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ �

1437 Market

D D 1433 Market

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LJI� Lv 5 +51'-8" 1r 1429 Market 1429 Lv 5 :lDn 616 (l - - ri

1425 Market

LEVEL FIVE SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ �

Lv4 +41'-4" Lv4 i

Lv3 +29'-4" Lv3 +27'-l" Lv3 Lv3 +24'-10 1/2"

Lv2 +16'-10" Lv2 + 15'-1" Lv2 Lv2 +13'-1 1/2"

Lv 1 Lv 1 +3" Lv 1 +4" Lv 1 +8"

1437 Market Street 1433 Market Street 1429 Market Street 1425 Market Street

MARKET STREET NORTH/ SOUTH BUILDING SECTION SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ Lv3 +24'-10 1/2" I

Lv 2 +13'-1 1/2"

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Lv 1 +8"

1425 Market Street

MARKET STREET EAST/ WEST BUILDING SECTION SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ 7

Lv5 +52'-0"

I Lv4 +41'-4"

Lv3 +29'-4" I

Lv2 +16'-10" Lv2 +14'-0"

Lv 1 +4" Lv1 +4"

1429 MarketStreet

MARKET STREET EAST/ WEST BUILDING SECTION SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ Lv 3 +27'-l" n

Lv2 +15'-l" Lv2 +14'-0" I I F I

Lv 1 +3" Lv1 -10"

1433 Market Street

MARKET STREET EAST/ WEST BUILDING SECTION SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ / '

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Lv 3 T I

Lv2 +14• • Lv2 I : I I

Lv 1 Lv 1 -10" I I 1437 Market Street

MARKET STREET EAST/ WEST BUILDING SECTION SCALE: 1/16"=1'-0" Source: 2013 Building Condition Report ■ First Level Bar

First Level - East View

1425 MARKET STREET

First Level - West View

Source: 2013 Building Condition Report Window Detail Third Level West Wall

Ceiling Condition

1425 MARKET STREET

Source: 2013 Building Condition Report Fireplace Mantel Level Three Stair Hall

Lav Detail

1425 MARKET STREET

Source: 2013 Building Condition Report East Facade South Elevation

1425 MARKET STREET

Source: 2013 Building Condition Report First Level Bar (East Area)

First Level Kitchen (East Area)

First Level Bar (West Area)

1429 MARKET STREET

First Level Raised Stage (West Area) Source: 2013 Building Condition Report ■ Second Level Bar (East Area)

Second Level Bar (West Area)

1429 MARKET STREET

Source: 2013 Building Condition Report First Level Tin Ceiling

Window Detail - Second and Third Levels

Architectural Detail - Bracket

1429 MARKET STREET

Source: 2013 Building Condition Report Third Level Stair/Hall Fourth to Fifth Level Stair

Fourth Level Hall

1429 MARKET STREET

Source: 2013 Building Condition Report East Facade West Elevation

View Between 1429 West Area and 1433

1429 MARKET STREET

Source: 2013 Building Condition Report First Level Tin Ceiling

First Level Bar

First Level Interior - Looking West

1433 MARKET STREET

Source: 2013 Building Condition Report Second Level Stair Second Level Mantel

Second Level Boarded Windows/Kitchen

1433 MARKET STREET

Source: 2013 Building Condition Report Third Level Mantel

Third Level Hall

Third Level Ceiling Damage

1433 MARKET STREET

Source: 2013 Building Condition Report East Facade Alley Way Between 1433 and 1437 Looking West

East View Between 1433 and 1437

1433 MARKET STREET

Source: 2013 Building Condition Report East Facade South Facade

View of West Alley Porch

1437 MARKET STREET

Source: 2013 Building Condition Report 4 INCENTIVE POTENTIAL OPPORTUNITY ZONES OPPORTUNITY $6 Trillion ZONES 101 In unrealized individual and corporate capital gains

50 Million Americans living in economically distressed communities

PRIVATE FOR PUBLIC CAPITAL GOOD OPPORTUNITY ZONE TAX BENEFITS

Several tax incentives are available based on an investment’s time horizon

Temporary Deferral of Capital Gains Tax Liability 1 Gains reinvested in Opportunity Funds will receive a 10% step-down in basis after 5 years, lowering the total deferred gains due in 2026.

Step-Up in Basis of Capital Gains Invested in Opportunity Funds 2 Gains reinvested in Opportunity Funds will receive a 10% step-up in basis after 5 years and an additional step-up of 5% at 7 years. A maximum of 15% of the original gains may be excluded from taxes.

Permanent Exclusion of Gains Generated by OZ Investment 3 New capital gains generated by Opportunity Fund investments are excludable from taxable income if held for at least 10 years. This does not apply towards the original capital gains reinvested. OPPORTUNITY ZONE INVESTMENTS

Billions in targeted capital may flow to Opportunity Zone Investments BY THE NUMBERS INVESTMENT FOCUS AREA

United States: Community Revitalization 163 Opportunity Funds created across the U.S. Mixed-Use Development $75 Billion dollars targeted for investment in OZs Commercial Real Estate

Small Business Development NEW MARKETS TAX CREDITS (NMTC) NEW MARKETS TAX CREDITS (NMTC)

The NMTC Program is dedicated to increasing economic opportunity in distressed communities across the U.S. NEW MARKETS TAX CREDITS (NMTC)

A proven tool for generating opportunity in low -income communities (LICs)

Community Development Entity (CDE)

Private Investor Tax Credit Amount NMTC • The New Markets Tax Credit is taken over a 7-year period • The credit rate is: • 5% of the original investment amount in each of the first three years • 6% of the original investment amount in each of the final four years • Total credit equals 39% of the original amount invested in the CDE

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 TOTAL 5% 5% 5% 6% 6% 6% 5% 39% NMTC

As a potential $8.97MM redevelopment, the Property could theoretically attract up to $6MM in NMTC allocation 1425 -1437 Market Street – NMTC Potential

• Assuming a $6MM NMTC allocation, the total benefit to the project would be $1,278,401 • NMTCs act as gap financing which makes a project more economically attractive in underserved markets HISTORICTAX CREDITS (HTC) HISTORIC TAX CREDITS (HTC) Federal HTC • Federal HTCs are an indirect subsidy to finance up to 20% of Qualified HTC Rehabilitation Expenses (QREs) programs exist in both the federal level and the state level

Federal HTCs have Since it began in 1976, generated over federal HTCs has $102BB in estimated preserved more than rehabilitation 45,000 buildings* investment* HISTORIC TAX CREDITS (HTC) State HTC • In addition to the federal income tax credit, a similar 25% state income tax HTC credit is available to owners. The total credit on a qualified project is 45% of programs exist in both approved rehabilitation costs. the federal level and the state level HISTORIC TAX CREDITS (HTC)

1425 – 1437 Market Street has been on the National Register of Historic Places since 1979 and remains one of the City’s most impressive and significant historic properties 1425 – 1437 Market Street – HTC Potential

• QREs are roughly estimated at $8.5MM for an $8.97MM development • Assuming an $8.97MM project with $8.5MM in QREs and Federal and State pricing of $0.85 for federal tax credits and $0.88 for state tax credits, total subsidy could be $1.4MM in Federal HTCs and $1.87MM from State HTCs, less fees WEST VIRGINIA TAX INCREMENT FINANCING (TIF) TAX INCREMENT FINANCING (TIF)

In West Virginia, a TIF works by locking in the taxable worth of real property at the value it TIF holds at the time the authorization legislation is an ec onom ic was approved dev elopm ent m ec hanis m available t o local Payments derived from the increased gov er nm ent s in West assessed value of any improvement to real Virginia t o f inanc e public property beyond that amount are directed inf r as t r uc t ur e towards a separate fund to finance a number im pr ov em ent s & , in of infrastructure needs including public roads c er t ain c ir c um s t anc es , and highways, water and sewer lines, r esident ial r ehabilit at ion remediation, land acquisition, demolition, the provision of gas, electric, and communications service facilities, and the enhancement of public waterways TIF

TIFs are implemented at the local level and may be created by a township, municipality or county 1425 – 1437 Market Street –TIF Potential

• The subject Property is located within the Downtown Wheeling TIF District. Prospective developers may pursue TIF financing with the City of Wheeling. WHEELING FACADE IMPROVEMENT PROGRAM

The City of Wheeling’s Facade Improvement Program (FIP) provides assistance for qualified improvements to privately owned commercial buildings within the Central Business District. 1425 – 1437 Market Street –TIF Potential

• The subject Property is qualified to receive program funds as it is located in the Central Business District. 5 FINANCIAL MODEL MODEL*

Summaries

Return Summary Sources of Funds Summary Estimated Project Cost $8,971,763 Investor IRR 20.25% Sponsor Equity $175,000 Deferred Developer Fee $350,000 Investor IRR 21.85% Senior Loan $3,553,710 w/ Opportunity Zone Federal HTC Equity $1,436,662 State HTC Equity $1,877,990 State/Local Grants $300,000 NMTC Equity $1,278,401 TOTAL SOURCES $8,971,763 MODEL*

Sources & Uses

SOURCES USES Item $ Cum. % Item $ % Senior Loan $3,553,710 39.6% Property Purchase $40,000 0.45% TOTAL DEBT $3,553,710 39.6% Construction Hard Costs $7,332,000 81.72% Deferred Developer Fee $350,000 3.9% Construction Soft Costs $123,320 1.37% TOTAL SPONSOR EQUITY $525,000 5.9% FF&E $91,650 1.02% Federal HTC Equity $1,436,662 16.0% Closing Costs $373,834 4.17% State HTC Equity $1,877,990 20.9% FM & Bridge Interest Res. $288,193 3.72% TOTAL HTC EQUITY $3,314,652 36.9% Contingency $372,766 4.15% State/Local Grants $300,000 3.3% Developer Fee $350,000 3.90% NMTC Equity $1,278,401 14.2% TOTAL OTHER INCENTIVES $1,578,401 17.6% TOTAL $8,971,763 100% TOTAL $8,971,763 100% THANK YOU!