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Redeveloping Madison Avenue Takes Courage and George Hagan

EXCLUSIVE

"I believe the tide rises all boats."

If the moon controls the tide, then George Hagan is the pie in the sky with big ideas for Downtown Covington.

The successful businessman, nursing home executive, and developer has set his glow upon two blocks of Madison Avenue in an area long neglected and barely even referenced in any of the several redevelopment plans in the works in the city.

"We have to change the first impressions," Hagan said.

It is Hagan's belief that the recently widened and beautified Martin Luther King Boulevard (formerly Twelfth Street) is the gateway to Covington, particularly as plans loom for the Brent Spence Bridge project which may redirect even more traffic in the direction of that east-west corridor.

At the intersection of MLK and Madison Avenue you have the landmark St. Mary's Cathedral Basilica of the Assumption on one corner, the newly constructed offices of the Diocese of Covington on another, a brand new Walgreens on the other side of MLK, and the historic roundhouse Duro Bag building across from there.

"Once beyond that, it's pretty scary as far as the real estate," Hagan said. "When you drive down there, you might not know anything about this city. I think it's incumbent upon all of us to focus on that area."

Other efforts are underway to change the face of MLK. Some properties moved by the Commonwealth of Kentucky during the road widening project were recently sold at auction to developers. For his part, Hagan is looking just north of the prominent MLK/Madison intersection. When Henderson Music decided to move and sell its buildings on the 900 block where it had been located for fifty years, Hagan jumped at the chance to acquire them. He also picked up 801 Madison, a former restaurant that was once home to Downtown Covington's Frisch's.

He may also be interested in other buildings in the future, but he has his work cut out on the newly acquired ones first.

After purchasing the two buildings previously owned by Henderson on the 900 block, Hagan had the smaller one, which had suffered from poor upkeep, torn down. A landscaped parking lot will take its place. For the main Henderson building, Hagan's plans call for six new market rate apartments, four 1-bedroom units, and two 2-bedrooms. The first floor commercial space will remain designated for retail but will be "white-boxed", the process of renovating a space in a generic fashion to help potential occupants better see the possibility of using it.

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That's something that has to be done to more vacant spaces in Downtown Covington, Hagan said.

"I think there's people wanting to locate in the city but when you think of all the vacant spaces, if you show them to a true business guy, the space is mind-boggling," he said. "If you walk through them it's scary."

"He's got to keep focusing on his business. He can't focus on how to improve the building."

"If we do (white boxing) enough, I think we can get some more businesses into our urban core," Hagan continued. "It takes a village. We did not get here overnight. It's going to take a lot of people." 

Hagan's largest property in the former St. Elizabeth Hospital building between Wallace Woods and Austinburg which he purchased with a group of real estate partners. There he placed his nursing home business, Providence Pavilion. Hagan has spent a great deal of his professional career in the business after graduating from the University of Kentucky. He's an Owensboro native who also lived for several years in Louisville, but when his wife took a job in Cincinnati, Hagan discovered Covington.

"I fell in love with it and its potential," he said.

He believes that if more spaces in the city are ready for it, Downtown Covington is poised to be the region's next Over-the-Rhine, the trendy Cincinnati neighborhood that has seen its reputation change from local wasteland to national case study in gentrification.

"Maybe me doing this simple little thing will bring in a couple more people to our city," Hagan said. "It's not that complicated."

One complication is the former Frisch's space, a property that sat vacant for years and suffered interior damage from a roof collapse. Hagan's crews have already been working on the white box effort in that space which he envisions as no longer being a restaurant, but a place for multiple small businesses to locate.

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"I like the property," he said. "What I'd like to do is find a tenant for the from the front and then create smaller commercial spaces in the back." While touring the property, Hagan pointed out the side wall that faces north on to Eighth Street and said that one possibility would be to add garage doors for an open-air commercial space.

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The low-cost rent for the new commercial spaces would be another strategy in positioning Covington as "the next Over-the-Rhine". "There are people who can't afford a thirty or forty thousand dollar space," Hagan said. "Over-the-Rhine had a lot of money thrown in there and regular people couldn't afford rent on the front side so (urban developer 3CDC) took a percentage of your revenue. It worked out."

But now there are businesses unable to locate there or some possibly looking to leave, "because the costs are astronomical", Hagan said.

"I think we're next. Our infrastructure, our streets. We can support that," he said. "We have a whole lot of opportunity for a guy who wants to come over and invest now and see value later."

Like Over-the-Rhine, Downtown Covington will also have to face the high concentration of social service agencies in a commercial district.

"We can't focus and concentrate all the agencies in one place," Hagan said. "It's going to take people with resources and if we just concentrate poverty and agencies in one area than nobody with resources can make any impact."

He said he is excited to see the Kentucky Career Center (formerly known as the One Stop Shop), which can help the unemployed find work, prepare to locate just south of the new Walgreens on Madison Avenue.

"If you look at poverty, people who are poor are some of the hardest working people around. I think we have this concept that everyone in poverty is lazy. That's not true," he said. "They may just not have all the social resources they need to get them to the next level."

Poverty does not have to be condensed in Downtown Covington, he said, noting that some people argue that agencies locate where the poor are. Hagan's church in suburban Cincinnati feeds more than three hundred poor people every week in Milford, Ohio. "It's all over the place," he said.

"I used to be an individual without a lot of resources and I once was an individual with resources who judged," Hagan said. "You have to be in relationship to understand what their needs are."

Developing good real estate is a step in changing the narrative in Downtown Covington, he said. The change would also bring more people to the urban core to live and work.

"If all we have is people without good income we don't get beyond where we are today," he said.

Story & photos by Michael Monks, editor & publisher of The River City News