When new tenants take up residence in the renovated apartments of the Historic Mercantile Building in Cincinnati, Ohio, they will become part of the city’s history.

In a project made possible by federal Historic Tax Credits, along with historic preservation and transformational mixed use development credits from the state of Ohio, the Cincinnati-based developer the Model Group, with support from the National Trust Community Investment Corporation, spent the last year and a half transforming this 1904 office building into much-needed housing in the city’s downtown neighborhood. It is just one of many projects these two organizations have partnered on in a quest to reimagine and reinvigorate neighborhoods via community-minded historic preservation.

At the top of the 12-story skyscraper sits the Mercantile Library that gives the building its name. This 189-year-old subscription library, which offers book talks, lectures, and community events, will also expand as part of the project.

Immediately next door to the Mercantile Building sits the 1970 Formica building, the most recently constructed building in Cincinnati to be listed on the National Register of Historic Places. As part of the project, the two buildings will be integrated into the Historic Mercantile Building, and the residential components will be known as the “Merc & Mica.”

Like many cities across the United States, Cincinnati’s downtown changed dramatically during the COVID-19 pandemic as more and more people began to work from home and office buildings grew vacant. Despite the obvious disruptions, this has also allowed developers, city planners, and residents to re-think areas of cities once primarily seen as business districts, turning them into places where people can both live and work.

“Post COVID, given the future uncertainty of office work, we see an opportunity,” said Jason Chamlee, vice president of development at the Model Group. “For so long, we took the health and strength of the downtown office market for granted. But now that’s really threatened. And so we’re saying, hey, there is a different future for these office buildings, and we want to be part of remaking that future.”

The Mercantile Building, with its dramatic beauty, historical significance, and prime location, is an ideal example of how that future is being made in Cincinnati.

A Library for Ten Thousand Years

The history of the Mercantile Building is tied up in the history of the library that sits on its top floors. Founded in 1835, the Young Men’s Mercantile Library Association first met about four blocks from the current location. Eventually, they moved to a building at the current location, then owned by Cincinnati College. The college offered them an extraordinary deal: a $10,000, 10,000 year lease that guarantees the library will remain on that same plot of land until the year 11845 at the cost of only $1 per year.

69 years—and two major fires–after the Library was founded, the Thomas Emery's Sons Company approached the organization with a plan for a new building. The resulting building was one of the first skyscrapers in Cincinnati, and part of the city’s growing business district in the early 20th century.

Over the years, a variety of tenants occupied the building alongside the Mercantile Library, including the building’s architects, Joseph J. Stenkamp Brothers. But by the time the COVID-19 pandemic struck in 2020, it only had one owner-tenant. With the owner seeking to sell, the Model Group saw an opportunity to be part of Cincinnati's downtown transformation. In 2022 they bought the building and began to look for partners that would help them restore and renovate the 120 year old structure. They quickly found one in the National Trust Community Investment Corporation (NTCIC).

Possibilities of Partnership

A subsidiary of the National Trust for Historic Preservation, NTCIC has for many years found camaraderie with the mission-driven Model Group. Both organizations are committed to community development and revitalization and have worked on several other projects together, including the rehabilitation and adaptive reuse of eight historic structures in Cincinnati.

NTCIC guides developers through complex and multifaceted historic tax credit processes, which can involve working with local, state, and national governmental entities, investors, and financial institutions. They evaluate the viability of projects, connect building owners to the National Park Service and State Historic Preservation Offices, facilitate the monetization of tax credits, and more. In the case of the Mercantile Building, the NTCIC’s expertise allowed 25 percent of the capital for the $80 million project to come from a combination of federal historic tax credits, Ohio Historic Preservation Tax Credits, and Ohio Transformational Mixed Use Development Credits

“We’re two sides of the same coin,” said Jason Chamlee, “As the developer, we’re putting the deal together and securing the credits. NTCIC knows how to turn tax credits into cash that is needed to build the project. They were our first and top choice [of partner] because we knew that they’d have the scale, expertise, and sophistication to put it together with us.”

David Clower, President and CEO of NTCIC, emphasized that another partner made the project possible as well: the Ohio state government. While more than 70 percent of states offer tax credits that support the renovation of historic buildings, along with complementary credits that encourage mixed-use development, Clower finds Ohio’s approach particularly helpful. “[Ohio] is a model for the nation,” he said. “But for the way those tax credits work together, I’m not sure this project would have happened. And not all states have tax credit programs that prioritize this kind of community revitalization. It’s just a fantastic example of what’s possible when you have good public policy, and you have good partners that know how to work together.”

Live, Work, and Learn in One Place

When the renovation is complete, the Mercantile Library itself will occupy the full 11th and 12th stories, doubling its space. They are using their new space to build a lounge and lecture hall, writers’ stations and quiet booths, a haiku and poetry room, and more shelving for books.

“This expansion will allow us to be more thoughtful and inclusive,” Mercantile Library Executive Director John O. Faherty told the Cincinnati City Beat when the expansion was first announced. “We will hold more events, buy more books, bring in more voices. We will create a bigger community of people who love to learn."

All residents of the “Merc and Mica” will receive complimentary membership to the Library–a unique amenity for tenants and an opportunity for the Library to grow its audience. “By baking memberships to the library into our rent, we’ll drive more traffic to the library and help them thrive,” said Chamlee. “But it will also make living there a unique experience. Every building has a pool, a lounge, and a clubhouse, but we’re the only one with a historic, operating library.”