Saturday, July 31, 2021

'Temporary', huge parking lot planned on downtown lakefront

An 18-acre swath of city-owned land is proposed to be developed
with a surface parking lot that would offer up to 2,000 spaces for
cars. But the plan is meeting early resistance (Google).
CLICK IMAGES TO ENLARGE THEM

A parking lot with nearly 2,000 parking spaces is proposed to be built on 18 acres of downtown lakefront land, with parking spaces being placed right up next to the water's edge of Lake Erie. That's according to a building permit application submitted to the city this past week on behalf of the Greater Cleveland Sports Commission.

The application, drafted by Osborn Engineering, proposes to add 1,175 parking spaces to the 775 spaces that are already existing along and immediately north of Erieside Avenue and First Energy Stadium, home of the Cleveland Browns. The total number of parking spaces would be 1,950 if the application is approved by the city's Building Department.

Existing parking on the site is located more than 300 feet away from the water's edge and, for the most part, was used by a smattering of workers at the Port of Cleveland, stadium employees and visitors to North Coast Harbor. The existing and proposed parking lot land is owned by the City of Cleveland.

But most of the spaces were placed there for use by fans and workers attending eight regular season and one or two preseason Cleveland Browns football games per year. That is how the additional spaces are proposed to be used, too.

Site plan for the parking lot expansion north of First Energy Sta-
dium, seen at bottom. Lake Erie is on the top. Port of Cleve-
land property is on the left and the Steamship William G.
Mather Museum is at the right. This site plan was
spread across two pages that were combined
electronically for clarity (Osborne).

Neither Meredith Painter, director of marketing and communications, or Marketing Coordinator Rachel Gill, both at the Greater Cleveland Sports Commission, responded to requests for comments and additional information prior to publication of this article. Both acknowledged receiving the e-mailed requests.

In the permit application to the city, Jon-Michael Lemon, director of civil engineering at Osborn Engineering, wrote "We are planning to restripe a large portion of the existing parking lot, north of Erieside."

However, much of the site proposed for the additional parking spaces was never a parking lot. Until this winter, there were two vacant port warehouses on the city-owned land. They were demolished, their foundations removed and the site paved to host a temporary stage and support facilities for the National Football League's 2021 Draft to select eligible players to play professional football.

Osborn Engineering estimated the cost of adding the 1,175 parking spaces to the downtown lakefront at about $80,000, according to the permit application. The parking lot is proposed to be "temporary" as the Haslam family, owners of the Cleveland Browns, are proposing a major redevelopment of the lakefront. Osborn is part of the redevelopment team. The Haslam's Harbor Development Plan includes new housing, offices, hotels, restaurants, retail and public spaces.

In April, the National Football League erected this temporary
stage on the downtown lakefront where the proposed park-
ing lot is now proposed to go. The stage and its ancillary
structures were kept only briefly, used for the foot-
ball draft from April 29 to May 1 (NFL).

But some city officials and lakefront advocates said such plans are years away from being realized. Instead, they wondered why a temporary greenspace wasn't proposed instead of a temporary parking lot. Some vowed to fight the proposed parking expansion.

"Generally, using our waterfront for parking is a terrible idea," said Ward 3 City Councilman Kerry McCormack, whose ward includes downtown. "I would hope that we are trying to correct this type of use (surface parking) that we already have too much of in Cleveland."

Dick Clough, executive board chair of the Green Ribbon Coalition which promotes public access to and use of the lakefront, responded angrily to the idea of putting a parking lot on the downtown waterfront.

"It just amazes me that we would devote prime lakefront land for eight Browns dates versus developing a public park that could be enjoyed every day during three seasons," Clough said. "As usual, it's a complete lack of vision and a huge missed opportunity."

Proposed by the Haslam family, which owns the Cleveland Browns
football team, this Harbor Development Plan would transform
the downtown lakefront. But it will be years, at best, before
this plan can be realized. Thus any "temporary" changes
to the lakefront may remain for a long time (Browns).

He suggested that the Greater Cleveland Sports Commission should partner with the Greater Cleveland Regional Transit Authority (GCRTA) to encourage Browns fans to use public transportation to attend Browns games thereby reducing the parking needs.

Clough pointed out that the $80,000 proposed to be spent on expanding the parking lot with 1,175 parking could instead buy GCRTA day passes for 2,000 fans for eight Browns regular season home games. Or they could sell the passes at a discount and make them last for two or more seasons, he said.

"We could recreate the Donald Gray Gardens on that site," Clough added, referring to a public gardens that existing on the north side of the old Cleveland Municipal Stadium that stood where First Energy Stadium is now.

"A great lakefront does not include dedicating prime land with lake access for a giant parking lot used for a few hours on a few days," Clough said. "We're awaiting the implementation of the recently announced Browns Harbor Development Plan which is probably five or 10 years down the road. In the meantime, the only temporary thing we should be creating is a public green space on the real estate north of the stadium."

END

Higbee's Public Square façade to add outdoor gambling

The first floor of the JACK Cleveland Casino, formerly the Higbee's
department store downtown, is proposed to be opened up to create
an outdoor gaming patio. To the right of the casino's Ontario Street
 canopy (at left) and around to the front of the casino facing Public
Square (at right), windows will be removed and the lower part of
their openings will gain pre-cast concrete planters (Google).
CLICK IMAGES TO ENLARGE THEM

For generations, from 1931-2002, many of us did what Ralphie Parker and his friends did in the movie "A Christmas Story." We fogged up the icy Public Square windows at Higbee's department store downtown while looking at the latest toys and gifts that were available inside.

Even today, as one-armed bandits and card games on green felt tables were played inside, the Higbee Building's Public Square windows of the JACK Cleveland Casino still displayed a holidays-themed motif featuring items from the 1983 movie for people strolling past.

If plans submitted by JACK Entertainment are approved by the city, those will no longer be seen on Cleveland's Public Square and a short section of the Ontario Street side. The reason is that the first floor of the casino facing the square will have its glass windows and front entrance removed to create an outdoor patio offering year-round gambling using electronic gaming terminals.

In front of and below the window openings will be concrete planters. Beyond that will be an open space which design documents called a moat to separate the gaming area from the cold and heat of Public Square and Ontario Street. Above and below the gaming area will be an extensive heating and cooling system.

The outdoor gaming patio will be isolated from the rest of the casino by glass and a vestibule. For patrons, the only access to the patio will be by entering through other parts of the casino first. However a direct exit from the outdoor gaming area to Public Square will be provided.

Ground floor plan for the JACK Casino Cleveland with Public
Square and the outdoor gaming patio (shaded area) seen at left.
Ontario Street is along the top, Prospect Avenue at right and
Tower City Center along the bottom (Cupkovic).

Entry to the casino from Public Square will be via the Tower City Center portico. However most patrons enter the casino via the skywalk over the intersection of Ontario Street and Prospect Avenue, from the casino's parking garage.

Aleksandra Breault, public relations and communications manager for JACK Entertainment, acknowledged the project was an expansion of the gaming floor of their Cleveland casino but was unable to provide additional details right now.

Ward 3 City Councilman Kerry McCormack, whose ward includes downtown, was generally supportive of the casino's new gaming concept although he had not seen the detailed plans yet.

"In general, I am supportive of patio usage as a way to support street life," McCormack said.

But a noted local preservationist and architect Steve McQuillin was not supportive of the plans that would salvage and put into storage historic storefronts, ceilings including the backlit ceiling clouds and lighting, and glass work. However, the former department store's canopies and awnings will remain, plans show.

This more detailed view shows the darkened area with the changes
to the ground floor plan associated with the outdoor gaming patio.
Tower City's Public Square portico is at the bottom (Cupkovic).

"These are pretty serious changes," he said. "The concept seems very disrespectful to historic preservation and to the downtown ambience. As you may recall those were originally display windows visible from both sides via an open air walkway. It's pretty terrible."

McCormack had not seen the plans because they do not require any design review by the City Planning Commission or City Council, even though the Higbee Department Store remains on the National Register of Historic Places. It was added to the register in 1976 when the entire Cleveland Union Terminal Group of buildings, including Terminal Tower, was designated.

That changed when the National Park Service, which oversees the historic register, rejected plans for the skywalk over the Ontario/Prospect intersection. The skywalk could still move forward, but the casino had to give back historic credits it received to renovate the casino in 2013. Thus, future renovations no longer required anything more than a building permit from the city's Building Department. 

"Since the casino gave back the tax credits because of their overhead walkway, there is no longer any preservation review," McQuillin said. "All they need to do is get the city’s okay and that’s basically routine."

END

Friday, July 30, 2021

Library Lofts high-rise construction starting soon

Although site work on the first new tower at Circle Square in Uni-
versity Circle began three months ago, a formal groundbreaking
ceremony was held July 29 for the 24-story Artisan apartment
building. Site preparation work is due to start next week for
the next tower at Circle Square - the 11-story Library Lofts
offering apartments over a new library (Chris Ronayne).
CLICK IMAGES TO ENLARGE THEM

Here comes another major construction project that will produce a tower crane in the sky over Cleveland, and over University Circle in particular. And we're just getting warmed up, Cleveland.

Site preparation work is scheduled to start on or about Aug. 2 for Library Lofts -- the next phase of the massive Circle Square development. A tower crane for this project will likely arrive on the site well before Thanksgiving. And with all of the construction happening in Cleveland, there will be a lot for which to be thankful.

Chris Ronayne, president of the neighborhood development corporation University Circle Inc., confirmed to NEOtrans about the start of construction work for Library Lofts, 10541 Euclid Ave.

Cleveland-based Midwest Development Partners' roughly $55 million, 11-story building will feature 207 market-rate apartments above a new, two-story Martin Luther King Jr. (MLK) Branch of the Cleveland Public Library (CPL) -- hence the name Library Lofts.

It will be the second of as many as six towers to rise in the $300+ million Circle Square development, bounded by Euclid, East 105th Street, Chester Avenue and MLK Drive.

Designed to look like bookshelves, the 11-story Library Lofts will
provide round-the-clock source of customers to retailers and restau-
rants in a growing University Circle (Bialosky, SO-IL/JKURTZ).

It is near the location of where a dense, vibrant neighborhood called Doan's Corners stood. It was Cleveland's second downtown. But its theaters, shops and residential hotels declined starting in the 1950s and, except for the 13-story Fenway Manor, was completely demolished by 1990.

Work began in early April for the Artisan, 10600 Chester, a 24-story, 267-foot-tall residential-over-retail tower that will be the tallest building in University Circle. Artisan will have 298 market-rate apartments and 287 parking spaces over 14,005 square feet of ground-floor retail. It will overtake One University Circle which held the title as University Circle's tallest since 2018.

"University Circle was Cleveland's second downtown a century ago. And it is again thanks to investments like Circle Square," said Ronayne, who announced nearly a month ago he is running for the office of Cuyahoga County Executive.

The MLK Branch Library will remain open during construction. Once the new library is opened, the existing one, built in 1970, will be demolished for a future phase in the Circle Square development. Plans show a residential tower or possibly a hotel could rise on the old library site.

After the city approved Library Lofts' final design May 21, general contractor Panzica Construction set up a construction timetable for the project. That schedule shows, starting about Aug. 2, Chicago-based Power Construction will build 50 temporary library parking spaces on the east side of Stokes Boulevard and add traffic control measures. Fencing and signage around the site will follow a week or so later.

Site plan for the huge Circle Square development which includes
"squaring off" the corners at several intersections to slow down
vehicular traffic to make the area safer for pedestrians (MDP).

Site preparations and foundation work for the two-story concrete podium containing the new library will begin on or about Aug. 17. Construction of a 488-space public parking garage, between Library Lofts and Artisan, is due to start in March 2022 with garage work taking about nine months. Artisan and Library Lofts are expected to be completed in spring 2023.

Power Construction is the general contractor for Chicago-based White Oak Realty Partners which is building Artisan next door. These first two Circle Square towers, plus the new public parking garage, are being coordinated between multiple project partners.

"In partnership with CPL, Midwest (Development Partners), White Oak Realty, (architect) Bialosky and the Cleveland Building & Construction Trades Council, we'll have a library-centered neighborhood of more than a thousand new units in a buzzing, pedestrian friendly and transit-connected urban center," Ronayne added. "The future of the city is here."

It certainly is where most of Cleveland's major-new construction work is happening and will likely continue for some time. In addition to the Artisan and Library Lofts, four other major projects are due to start in University Circle in the coming months -- all of which may warrant a construction crane.

Those four are also all associated with the Cleveland Clinic Foundation (CCF). Three of them are directly led by the CCF -- a 400,000-plus-square-foot new Neurological Institute, a 100,000-square-foot expansion of the Cole Eye Institute and a 400,000-square-foot new Global Center for Pathogen Research & Human Health.

At the front-center is the historic Fenway Manor apartments. To the
left of it is Library Lofts. In any other era, that would be one of the
largest towers to rise in University Circle. Not this era. In the rear-
center, the 24-story Artisan is already under construction. It may
be eclipsed in height by another apartment tower to the right-rear
and a new office building at front-right (Bialosky).

For the fourth project, the Clinic is working with a private developer, Fairmount Properties, to jointly develop hundreds of thousands of square feet of mixed uses in phases, just south of Cedar Avenue and west of East 105th.

A decade ago, Fairmount joined with the Wolstein Group to develop Flats East Bank downtown. It then joined with DiGeronimo Companies to build Pinecrest in Orange Village which opened in 2018.

In the first phase of its partnership with CCF, Fairmount envisions 300 micro-unit apartments, several dozen townhomes and a 40,000-square-foot Meijer grocery store rising 5-10 stories above the southwest corner of East 105th and Cedar. A second phase of roughly equal size could follow immediately west of it. Sources said financing for the project is still coming together.

Knez Homes, which is building hundreds of new housing units around University Circle, said the number of new jobs coming to that area over the next decade could create a demand for up to 10,000 new housing units.

Future phases of Circle Square may include a residential tower possibly taller than Artisan, making its altitudinal reign over University Circle possibly as brief as One University Circle's. Also planned is a second new parking garage plus an office building approximately 13-15 stories high that could also approach 300 feet in height.

END

Phantasy Theater renovation as Studio West 117 begins

Rendering of what The Fieldhouse at Studio West 117th could look
like when its renovation is completed in the spring 2022. Other phases
of the Phantasy Theater complex will come on line into 2023 (Groundswell).
CLICK IMAGES TO ENLARGE THEM

Construction fences are up. Work crews are on site. And a $75 million vision for the rebirth of the Phantasy Theater complex, 11794-11814 Detroit Ave. in Lakewood, into Studio West 117 is starting to come to life.

But if you ride by the site on Detroit, you might miss the bulk of the early activity. The reason is the visible work is occurring behind the Phantasy Theater in a structure at 1384 Hird Ave. most recently used by Mack Products Co.

That structure is called The Fieldhouse by developers Daniel Budish and Betsy Figgie. It's actually three connected structures totaling 29,298 square feet that will host a gym and a South American steak restaurant, Stone oven pizza kitchen and rooftop tapas bar lead by Yanira Llanos and her wife Yasmeen Desiree. The gym will host fitness classes and sports leagues.

Budish, president of Gaslamp Capital LLC which specializes in historic renovations, said he hopes that renovation work on former Mack Products structures, some of which date back to 1905, will wrap up in the spring.

In the past week, construction fences went up around the former
Mack Products building on Hird Avenue, just north of Detroit
Avenue and the main part of the Phantasy Theater complex
at the east end of Lakewood (KJP).

"This is very exciting for us," Budish said. "Work on the Fieldhouse at Studio West 117 should be complete by the end of April. We are saying spring of 2022 just to give some added cushion in case there are any construction delays. We expect to have a major grand opening and Pride celebration in June of 2022."

Budish, son of Cuyahoga County Executive Armond Budish, along with Figgie who owns Your CFO Resource to provide financial assistance to nonprofit organizations, acquired the Phantasy Theater complex and Mack Products properties last year. Figgie also led the creation of the West 117 Foundation to "support entrepreneurship, arts, culture, health, and human services to create a hub for Cleveland’s LGBTQ+ ecosystem."

At around the same time, they acquired properties at 11600-11618 Detroit on the Cleveland side of West 117th Street. It's a mixed-use building with five businesses on the ground floor, including My Friends Deli, with eight apartments upstairs that will gain more of an LGBTQ+ presence as existing leases expire. 

The duo also joined forces with the Foran Group for a $14 million renovation of the 80,000-square-foot Astrup Awning plant as the Pivot Center for Art, Dance and Expression in the Clark-Fulton neighborhood. Tenants include the Cleveland Museum of Art, Intermuseum Conservation Association, Cleveland Rape Crisis Center, Cleveland Missing, Inlet Dance Theatre and LatinUS.

For more than 100 years, the Phantasy Theater, preceded in name
by the Homestead Theater, stood in the 18000 block of Detroit
Avenue. Now the property will gain a fresh new purpose and
appearance as part of a $75 million redevelopment (KJP).

"Other elements of Studio West 117 continue to progress well," Budish added. "Margie's Closet opened in one of our spaces back in June of this year. We hope to also have some of the Phantasy retail open for next summer as well. The full Phantasy renovation is still expected to be completed in 2023."

As for the total dollar investment when all phases and components are completed over the next couple of years, the $75 million figure may hold true.

"That would be a good estimate for now, with the understanding that some of these project elements still have to be flushed out further," Budish said.

"I'm thrilled about it -- not only for the mission of the organization, but for what it will mean for the east end of Lakewood," said Lakewood's Ward 4 City Councilman Dan O'Malley who is also council president.

Daniel Budish, left, and Betsy Figgie look over the
Phantasy Theater property including an alley that
will be repurposed as an entryway into a part of
the former entertainment complex (KJP).

"This project will be a game changer," he added. "I'm also happy that the developers are using local labor and paying prevailing wage."

The 56,000-square-foot Phantasy Theater complex began its life in 1915 as the Homestead Theater, a live performance and large movie house back when going to the movies was an all-day affair. The theater continued to show movies until 1979.

A couple of years later, it began its next life as a live music venue, hosting up-and-coming new wave, punk, industrial and goth bands like Devo, Exotic Birds, The Pagans, VNV Nation and was the debut location for Nine Inch Nails.

Established musicians performed in the Phantasy and in the adjoining Chamber club as well, like Iggy Pop, Joan Jett with Michael J. Fox, Jesus and Mary Chain, Marilyn Manson, The Pogues, The Psychedelic Furs and the Ramones.

Site plan for The Fieldhouse at Studio West
117th, located on Hird Avenue (Larsen).

Budish and Figgie envision six entertainment spots, a podcasting studio, co-working and retail spaces with low rent to help new businesses get their start. The goal is to offer a safe and comfortable location for LGBTQ-owned businesses gain a foothold and create a site for social interaction and business incubation.

"I think you're going to see a cascading effect with other development projects in the neighborhood for years to come," O'Malley said.

That may extend to nearby properties that include closed or under-utilized buildings like the former Vedda Printing, National Tire & Battery and others. O'Malley said there are always parties interested in redeveloping those properties but nothing was ready for publication at this time.

END

Thursday, July 29, 2021

Hough Bakeries redevelopment plan revealed

For nearly 30 years, a local institution beloved by many Greater
Clevelanders has sat vacant at the intersection of Lakeview and
Wade Park avenues. Knez Homes this week confirmed plans
for the site which the Painesville-based real estate developer
 hopes to start renovating by this time next year (Google).
CLICK IMAGES TO ENLARGE THEM

Few businesses are as symbolic of the rise and fall of Greater Cleveland's fortunes as homegrown confectioner Hough Bakeries. Its former headquarters and plant at 1519 Lakeview Road on the border of Cleveland and East Cleveland has sat vacant since the bakery, once the nation's 10th largest, went bankrupt and closed in 1992.

But its redevelopment may be equally symbolic of Cleveland's reversal of fortunes.

Starting next year, Knez Homes, one of the largest homebuilders in Northeast Ohio, hopes to start construction on renovating the nearly 5-acre plant into a mixed-use complex of housing, offices and possibly a restaurant.

Preliminary plans for the bakery site, contained in a promotional piece about Knez's development activity in the overall Circle North area of Cleveland's Glenville neighborhood, were provided to NEOtrans recently.

Knez Homes' plans for the Circle North area of Glenville, just
north of Cleveland's University Circle, that is being circulated
among interested home buyers (Knez). 

When contacted, Knez Homes founder and CEO Bo Knez confirmed the plans and expressed his excitement in being able to redevelop a site whose corporate history and products are near and dear to many Greater Clevelanders.

"This is a big deal for us," Knez said. "Considering how complicated the site is, the plan has gone better than expected."

Specifically, plans show 17 single-family homes, 22 townhouses, 18 apartments possibly for student housing plus a significant amount of commercial space. The commercial spaces would primarily be for offices and measure roughly 180,000 square feet.

Knez said two companies are looking at the site for office space but until they were signed, he could not identify them. While the site plan has no retail, a restaurateur expressed interest in locating in the bakery's old carriage house. The pandemic put the kibosh on those plans.

Beneath the graffiti, vegetation and
decay is an architecturally beautiful
building that is waiting to be reborn
with new uses (Iryna Tkachenko).

"There's no restaurant currently under consideration but we're open to it," Knez said.

None of the structures facing Lakeview to the south, which is the Cleveland side, or Auburndale Avenue on north, that is the East Cleveland side, would be demolished for the redevelopment project. Knez said they will be refurbished including their original historical features, such as the terra cotta façade facing Lakeview.

Like many other developments in Circle North, the Hough Bakeries redevelopment will be mixed income. Public funding usually requires it and there is a mix of local and state dollars going into the bakery project.

In addition to making it possible so that area residents can afford to live there, Knez said his firm is seeing a big demand for student housing in Circle North. Nearby are Case Western Reserve University, Cleveland Institute of Art and the Cleveland Institute of Music.

Knez Homes' Lakeview Commons, previously called the Wade
Park Townhomes, are rising across Lakeview Avenue from the
Hough Bakeries plant on a parking lot that was used by the
bakery's employees until the plant closed in 1992 (Knez).

He pointed out that the condominiums proposed in the Hough Bakeries redevelopment are actually fee-simple townhomes. That means the buyer has control of their property but the surrounding site is maintained through a homeowners association.

In Circle North, Knez is building up to 400 new housing units. Across Lakeview, on 0.9-acres of land on the railroad side of Wade Park Avenue, was the employees' parking lot for Hough Bakeries. There, Knez is building the 36-unit Lakeview Commons townhouse development.

The primary impetus for Knez developing in the Circle North area in general and Hough Bakeries in particular was Mayor Frank Jackson's Neighborhood Transformation Initiative (NTI), he said.

The program targets four neighborhoods and taps into the Cleveland Impact Fund, a $44 million account to support mixed-income and mixed-use developments. Buckeye-Woodhill, the East 79th Street Corridor, and Clark-Fulton are the other neighborhoods in the mayor's NTI program.

The north side of the Hough Bakeries property, along Auburndale
Avenue in East Cleveland (Google).

There is a strong demand for market-rate housing in and near University Circle which is why Knez is also developing homes in the Fairfax area south of the Cleveland Clinic. Between the growth of the Clinic, educational institutions and other employers in the area, Knez and other developers believe there is a demand for up to 10,000 new housing units near University Circle over the next decade.

Through an affiliate company, Knez acquired the Hough Bakeries plant in December 2019 for $225,000. Some site improvements were made to secure the property and some earthmoving has been done to prepare the site for redevelopment as well as to improve views for new homeowners in the area.

There are also a number of vacant residential properties around the perimeter of the former bakery that Knez is developing with single-family homes. Some will be sold at market rates and others will be made available to qualifying low-income families with the support of the Famicos Foundation, Knez said.

Hough Bakeries started in 1903 with a single store on Hough Avenue at East 87th Street in what was then a middle-class urban neighborhood. A growing Hough Bakeries in 1941 bought the Star Bakery plant at 1519 Lakeview Rd. But into the 1980s, the local firm could not reduce costs enough to fend off outside competition and ultimately went bankrupt.

END

Monday, July 26, 2021

Sherwin-Williams' 2nd HQ tower may rise sooner, not later

Outlined in red at the center of this model is Sherwin-Williams'
proposed second headquarters office tower, located to the left
of its larger first-phase. The second tower is shown here as a
largely featureless massing as it lacks a pending construc-
tion start date. But there are indications that the coatings
giant may have some end-users for the tower and a de-
sire to build the tower sooner rather than later (TV20).
CLICK IMAGES TO ENLARGE THEM

In models and on graphics, it was presented almost as an afterthought. It was a featureless box standing in downtown Cleveland at the northeast corner of West Superior Avenue and West 6th Street. Next door, the 600-footer served as a magician's tool of misdirection, with its primary role as the global headquarters of Sherwin-Williams (SHW).

But that blank box, a future HQ tower standing what appears to be about 300 feet tall based on the height of the Rockefeller Building across the street, could not be ignored by a joint meeting of city planning review committees on July 20.

To put the size of that building into context, the Ernst & Young Tower (E&Y) built in 2013 at 950 Main St. as part of the Flats East Bank development stands 23 stories and 330 feet tall. It is one of downtown's few trophy-class buildings -- the only office class above Class A. E&Y has the third-highest rents downtown and is 97 percent full, according to real estate brokerage Jones Lang LaSalle.

SHW's proposed second office tower was labeled on site plans as "Future Sherwin-Williams Expansion TBD" -- To Be Determined. Committee members wanted to determine what it would be and how soon will SHW build it. The reason is that an ugly, unwanted surface parking was shown as temporarily occupying that spot until the expansion building could be built.

The phase two office tower is located at the lower-left portion
of this SHW HQ master plan. It also has for its future phases
sections of lower-level mixed-uses along West 6th Street and
St. Clair Avenue to be developed by others (SHW).

"I've been on this (city planning) committee for a long time," responded a skeptical Thomas Zarfoss, a retired landscape architect. "Whenever I hear the term 'temporary' it gets my attention."

How long would that parking lot remain as "temporary"?

Timothy Muckley, SHW's director of corporate real estate, declined to give a date of when that future expansion would be built. And that future expansion also includes the east and south flanks of West 6th and St. Clair Avenue, labeled on conceptual planning documents as "Future Commercial Retail & Office TBD" and standing several stories tall.

"We've made this mistake with manufacturing plants of not planning for the future," Muckley said. "We want this to be our headquarters site for a long time. It's important to be able to have that for growth."

For logistical reasons, the second tower may be difficult to build at the same time as the 616-footer. HQ design team sources said SHW construction firms need the space for materials staging for the main tower, parking deck and Public Square pavilion. A smaller construction staging area, such as north of Frankfort, might suffice for the second tower which Muckley said would have no additional parking of its own.

Here's where it gets interesting...

This model of the SHW HQ shows a slightly shorter phase two
office tower, standing between a massing of the first phase to
the left and the Rockefeller Building to the right (TV20).

Muckley told the planning committee members that SHW is encouraging companies with whom it does business about locating new sales/administrative offices or relocated corporate offices in those future expansion spaces.

"We work with a lot businesses and we'll urge them to locate next door," Muckley said.

For months, NEOtrans was hearing rumors that SHW was actively seeking leases in its HQ tower by other office tenants. The rumor didn't make sense at the time. Why would a company seeking to build a 1-million-square-foot HQ -- with all of the HQ space already spoken for by most Cleveland SHW offices including an 8 percent growth factor -- make that HQ tower available to other tenants?

Because SHW isn't making the main HQ tower available to other tenants. It's making the second HQ tower available to other tenants. An employee of one of those tenants, based on the East Coast, reached out to NEOtrans months ago saying their company would open an office in Cleveland once SHW opened its new HQ.

But SHW doesn't have enough tenants signed up yet or it would build that tower now. It may not be able to get more office tenants to commit until the building's opening is a year away, a real estate insider told NEOtrans.

Since it's only a massing, there is no definitive size for the phase
two office tower. But this image gives a sense of what SHW
seems to want -- a tower that's roughly half the size of 
its first phase HQ tower (SHW).

"They are building expansion capacity into the new HQ, perhaps to relocate other people here to Cleveland or for another acquisition down the road," the insider said. "And they would be looking to lease that space in the short term. I've heard a few companies mentioned as possible tenants in the building. It would be the nicest, newest office building downtown, not to mention any firms that regularly do business with SHW would like to be close."

As for which companies, he declined to provide names but said they're basically any firm that is willing to pay top-of-the-market rents for a trophy-class office building. In other words, think law firms, technology, marketing, real estate and accounting firms, he said.

And, let's not forget that SHW hasn't yet included the relocation to its new HQ roughly 250 employees based in a 128,000-square-foot flex-office space on Hinckley Industrial Parkway on Cleveland's south side. SHW leased that property in 2017 for an unknown term after it acquired coatings rival Valspar for $11 billion.

Some of Valspar's employees were relocated from Minneapolis to Hinckley Industrial, according to SHW sources. Most of Valspar's corporate headquarters and research staff remain in Minneapolis. It is difficult to get a hard number on how many there are. The estimates range from 400 employees to 600 employees.

SHW is understandably very sensitive about saying anything publicly about the future location of Valspar's employees. Since it will take several years before any new SHW office space is available, SHW wouldn't want to tell its Minneapolis employees now that they'll be moving in a few years.

Until SHW builds its phase two office tower plus the low-level
development by others along West 6th and St. Clair, those
spaces will remain as surface parking lots (SHW).

That could lead to a situation where SHW would lose a lot of workers in the next several years because they have the chance to look for another job close to home. And it would be difficult for SHW to hire for those openings that will eventually relocate.

If anything, SHW has tried to reassure its Valspar employees and others in Minneapolis that they value that location.

"Minneapolis is like our second headquarters. We continue to invest in our people and product there," said former SHW spokesman Mike Conway in 2018 who also denied to NEOtrans in 2019 that SHW was even considering building a new HQ. That was months before SHW was ready to make the new HQ official.

Relocating 250 SHW flex-office workers from Hinckley Industrial Parkway and 400-600 Valspar employees from Minneapolis could fill 150,000 to 200,000 square feet of office space. That would provide a significant anchor office presence to the second tower.

Three sources reported to NEOtrans months ago that two HQ towers were planned all along, although two of the sources said neither tower would be very tall or iconic. That part turned out to be false. One of the sources said Cleveland-based architectural firm Vocon Partners was hired by SHW to do programming and spatial/massing work on a five-year contract which started last year.

In late June, SHW subcontractor Independence Excavating was
working near the northeast corner of West Superior Avenue
and West 6th, site of the phase two office tower. Next door
the 616-foot SHW HQ tower will soon join its three sky-
scraping neighbors around Public Square (KJP).

If Vocon's work was limited to the first-phase HQ tower, then it probably wouldn't need a five-year deal. If Vocon is also going to be providing services to SHW for the second tower, then it makes sense to keep them on board for more than just two to three years. It also suggests SHW wants to move forward sooner rather than later on the second tower.

So do the actions of geotechnical firms. They've drilled test bores to collect soil samples and measure the depth of bedrock at multiple locations throughout the 7-acre SHW HQ site west of Public Square. In late June, crews were doing site preparation work at the northeast corner of West Superior and West 6th -- right where the phase two tower would rise.

SHW has a lot more to gain from underselling its new HQ than from overselling it. SHW is more concerned with impressing its shareholders than those of us who admire and count the number of shiny towers in the downtown Cleveland skyline.

So whatever SHW is going to do and when is going to be determined on the potential for increasing value for its shareholder. If having more of its partner companies setting up offices next door will do that, then look for construction to start on this tower very soon.

END

Sunday, July 25, 2021

Are Bedrock's Tower City plans serious? Yes, here's why...

This rendering of what Bedrock Real Estate intends to do with the
south concourse of Tower City Center's The Avenue shopping
mall in downtown Cleveland, including a partnership with
Chain Reaction to award three entrepreneurs 18 months
of free rent at Tower City stores (Bedrock).
CLICK IMAGES TO ENLARGE THEM

Ten days ago, news broke that Bedrock Real Estate would aggressively market its Tower City Center complex so it could exchange its cobwebs and echoes for business tenants and retail customers. NEOtrans opted to not respond to this press release.

Why? Because I was skeptical about how serious Bedrock was. Understandably, shopping malls across the country were dying with some getting replaced by Amazon distribution centers. NEOtrans broke the news about several of them locally, starting with the first one at Euclid Square Mall. And all of those mall deaths occurred before the pandemic got other malls sick, too. 

Bedrock has contributed to the loss of tenants at Tower City as much as the growth of e-commerce and the decline of downtown's office workforce. But while downtown's workforce dipped, its residential population shot up and held strong through the pandemic. Residents are a more lucrative market for retail than workers who tend to make larger purchases nearer to where they live, a recent study showed. But that study also said downtown niche retail can draw customers from far away.

Furthermore, Bedrock has now owned the former Cleveland Union Terminal railroad station-turned-Tower City Center for five years and not been able to reactivate its 366,000 square feet of retail and public spaces. The opposite has happened. It has entertained previous ideas and none of them panned out, including CityBlock (NEOtrans broke the story on that one, too). So why are they are suddenly serious about redeveloping the downtown mall into, of all things, a mall? I had my doubts.

That was until this past week when two events happened.

In 1989, Tower City Center was in the midst of its conversion
from the Cleveland Union Terminal railroad station to a retail
center, office and hotel complex. But as more shopping and
lifestyle centers like Crocker Park, Legacy Village and
Pinecrest opened in the suburbs, fewer shoppers came
downtown and to Tower City (Cleveland Magazine). 

The first event was a note I received from a Bedrock source. "I’m surprised that you haven’t commented on our plans for Tower City on your blog," the source wrote.

I expressed my skepticism and asked why I shouldn't be skeptical.

"You can probably assume what you like from my having reached out to you," the source wrote. "Wish I could be more forthcoming. Keep up the good work. I know a lot of us have appreciated your blog. You seemed to know things about SW (Sherwin-Williams' headquarters site search) before we did or before they did for that matter."

The other event came two days ago from two Tower City tenants reporting to NEOtrans that they were contacted by Bedrock's local staff. The inquiries went something like this: "We'd like to know what your intentions are about remaining at Tower City Center." One was asked if it would be willing to make improvements to their retail space.

Those tenants are in a part of the mall that was unaffected by June's flood. A sprinkler above The Avenue mall at Tower City broke and flooded the mall near the Public Square entrance. Bedrock began securing city permits this week to make significant repairs to the flood damage, according to Building & Housing Department records.

An ill-fated redevelopment scheme for Tower City Center was
Bernie Moreno's CityBlock which would have turned the
mall into an incubator for technology start-ups and
other types of new businesses (Vocon).

If Bedrock is going to be courting retailers, who might they be? Let's consider the market, which involves both timing and population. And let's look at what is called "comps" in the real estate business, or comparables.

A real estate source who does a lot of work in site selections locally was contacted by NEOtrans for his input. He said Bedrock's initiative is mostly about the upcoming National Basketball Association's (NBA) All Star Game, to be held Feb. 20, 2022 in Cleveland.

To a lesser extent, the Rock & Roll Hall of Fame and Museum's induction ceremony on Oct. 30 will play a role. Both events will be held at the Rocket Mortgage Fieldhouse which is connected to Tower City by an underground walkway. Some pop-up retailers may be added by October but it will take longer for other retailers to come on board. That's why the NBA All Star Game is a bigger deal, the real estate source said.

Look for Bedrock to bring in athletic retailers like Nike, Under Armour and Moosejaw plus streetwear shops along the lines of RSVP Gallery or Bodega. Bedrock founder and Cleveland Cavaliers owner Dan Gilbert wants to put his best foot forward at the All Star Game. NBA stars start businesses. Others provide capital to them. And some are free agents, looking for a new team and a new home with cool stores to flash the cash. 

Mainstream retailers line downtown Detroit's main street of
Woodward Avenue thanks to Bedrock giving them low or
no rent for an introductory period of time (Google).

For comps, look no further than what Bedrock did to draw businesses to their properties along Woodward Avenue, Detroit's version of Euclid Avenue. They gave free or reduced rent to retailers that would draw business to benefit other nearby retailers. Finding the right mix of retailers is the key to any successful shopping area.

Along Woodward, you'll find all of the above-mentioned athletic retailers plus Bonobos, H&M, Warby Parker, lululemon, Le Labo, Shinola, Madewell, American Cycle & Fitness, UPS Store, FedEx Office, plus wine stores, day spas, drug stores, bank branches and lots of restaurants and clubs.

Those businesses alone would certainly reactivate Tower City. But what's equally intriguing is Bedrock's stated desire to work with Chain Reaction, a Cleveland-based economic development project, business bootcamp and competition that helps groom the next generation of local entrepreneurs. 

Chain Reaction is produced by Cleveland Neighborhood Progress, the Greater Cleveland Partnership’s Council of Smaller Enterprises, JumpStart and Cleveland Development Advisors. As a sponsor, Bedrock says it will provide mentorship to participants throughout the program’s duration, as well as prizes for the top three entrepreneurial finalists of their competition, combined for 18 months of brick-and-mortar tenancy at Tower City Center.

A conceptual rendering of what Tower City Center's Riverview
phase between Huron Road and the Cuyahoga River could
look like, featuring greenspaces, riverfront promenade,
plus office, hotel and residential buildings (Vocon).

And, as NEOtrans reported earlier this year, look for Bedrock to develop the Riverview phase of Tower City in the coming months and years. It has considered developing this site for some time, including for Sherwin-Williams HQ as alluded to earlier.

Now, Gilbert has one of his own locally growing corporate office end-users that will be looking for a new building soon -- Rocket Mortgage. Add to that a possible hotel and more apartments either in a new building and/or in Sherwin-Williams old HQ in the Tower City complex. They will need Tower City stores and other businesses to patronize.

Will Bedrock be able to attract the chain retailers, even by offering free rent as pop-up retailers over the coming months? Will they stay after the pop-up period expires and they have to pay rent? And how will Tower City's existing retailers who have stuck it out through some pretty dark times react to newcomers getting a free ride?

It will depend on how much new foot traffic the pop-up retailers attract to Tower City and the existing shops. There's a lot for Bedrock, Tower City and downtown retail in general to prove here. I no longer doubt Bedrock's sincerity to try something here. But there are still a lot of questions that have yet to be answered. And they will be, given time.

END