UD partnership signs 10-year, multi-million dollar lease for Dayton Arcade space

The University of Dayton and The Entrepreneurs Center have agreed to a long-term, multi-million dollar lease for space in the Dayton Arcade, just as the redevelopment project approaches a critical financing deadline this month.

A limited liability company created by UD and TEC called “The Arcade Innovation Hub” has signed a lease to pay $10 million over a decade for the space. A university spokeswoman declined to provide more financial details about how the deal will work.

The lease allows UD and TEC to secure 95,000 square feet of the facility. Tuesday’s announcement comes as good news for the arcade with financial needs looming for its first phase of redevelopment.

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“If not for this long-term investment, the arcade project would not have happened. We greatly appreciate their support and partnership,” Dayton City Manager Shelley Dickstein said in a prepared statement.

The financial closing on the arcade rehab project must happen in the next couple of weeks or it stands to lose important New Market Tax Credits, Dayton Mayor Nan Whaley has said. The $95 million first phase of the project is relying on several funding sources, including tens of millions of dollars in tax credits.

“If this does not close by April 25, this does not happen,” Whaley said in late March.

The arcade is the most complicated project in Dayton’s history, according to city officials. City commissioners are expected to consider a batch of legislation related to the arcade deal Wednesday.

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A bond ordinance and loan agreement to allow an $11 million loan in support of the rehab project will both be before commissioners. Other items up for consideration are expected to include community benefits and community reinvestment area agreements.

Local small businesses, start-ups and entrepreneurs will be able to use UD and TEC’s “innovation hub” at the arcade through a co-share membership. As a member, they will have access to everything from open desks to private offices, meeting rooms, conference areas, high-speed internet and other amenities, according to UD.

UD will station its L. William Crotty Center for Entrepreneurial Leadership in the arcade space, along with studios for painting, printmaking, photo and graphic design and gallery space.

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Student-run Flyer Enterprises will locate a new venture at the arcade. UD’s “GEMnasium,” a space where faculty, students and community members can work to address challenges like the opioid crisis and food insecurity, will also be housed at the arcade, according to the school.

“We are proud to partner with The Entrepreneurs Center to deepen our commitment to the Dayton community as an anchor tenant of this historic and important downtown space,” UD President Eric Spina said in a prepared statement. “Our innovation hub will fuel economic growth and spark creativity by enabling students, faculty and staff from across campus, including engineers, artists and business majors, to work alongside local entrepreneurs.”

The Entrepreneurs Center will use the hub as its central location and will provide comprehensive business and commercialization support to local entrepreneurs and start-ups. In addition to support for technology companies, the center will locate its Small Business Development Center in the hub, providing access to support for entrepreneurs of all types, according to a joint statement from UD and the center.

“We are thrilled to formalize our longstanding partnership with UD,” TEC president Scott Koorndyk said. “Together, we share the vision of reinvigorating this historic space to offer one of the most unique entrepreneurial environments in the country.”

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