SW sold and leased back all of their stores years ago to free up capital and to pay down debt. Just because it happened before they broke ground for the new HQ doesn't mean much when interest rates were favorable. 

 

I'm sure corporations, like residential landlords, can claim the corporate rent they pay to landlords and deduct that from total earnings to obtain a better tax outcome. Obviously i want more density, but I'm not reading into the decision. 

 

But someone please prove me wrong!

No insight on the recent transaction, just two photos from today.

 

Visible from Scranton Road Peninsula.

I guess l'm the only one here who sees this in at least a questionable light. I'm not an accountant so l can't speak to whether it's more favorable to own rather than lease. I can see advantages in both so, that being said, l prefer my Fortune 500 company to own rather than lease their national headquarters. The optics look better as owning at least gives the appearance of having more skin in the game. A greater sense of permanence if you will. 

 

Sure, leasing would free up funds to start building a second tower but l'm not sure that is really what would be driving construction. I think it is way more about a potential need for space rather than any financial machinations. With the way companies are giving back leased space these days l'm sceptical SHW ever builds a second tower at all.

 

Now if they were a more aggressive company l could see them building a second tower to take advantage of the additional space as needed while at the same time leveraging some of the cost by leasing some space. After all, the ONLY office space in town that appears to be wanted is class A space. But since SHW is not an aggressive company l remain sceptical about another building.

On their balance sheet this doesn't do much, moves the HQ from an outright asset to a right of use asset and depreciation  expense/accumulated depreciation to lease liability/expense. 

 

What this does for Sherwin financially tho is frees up the cash otherwise tied up in the construction of the HQ now. That's cash that they wouldn't otherwise be able to do anything with. So, depending on the interest terms of the lease they are better off having cash now to invest to be able to get a return on that investment the  wait the 2-3 years to have the cash freed up. Whether that's acquisitions or R&D. 

 

As far as leasing v owning, I'm not sure how many companies own their HQs. I'm not sure I'd be surprised either way.  But from the article describing how Sherwin is retaining control of the building and maintenance I'm not sure they really have less skin in the game... 

11 hours ago, cadmen said:

l prefer my Fortune 500 company to own rather than lease their national headquarters. The optics look better as owning at least gives the appearance of having more skin in the game. A greater sense of permanence if you will. 

 

Sherwin-William's Q3 balance sheet includes $11.2 billion of goodwill and intangibles out of 22.2 billion total assets - that's a LOT of air in the numbers. That means they have $11 billion in tangible assets supporting $11+ billion in long and short-term debt. They don't want more debt at the moment and need to whittle down what they do have without killing earnings and cash flow.  Eliminating $300-400 million for a HQs building will help. Selling the Brecksville R&D center would probably help as well.  

The caption to the rendering in this article alludes to a new design for the crown of the building being approved at the Dec 16th Planning Commission meeting.  I've reviewed the Commission's agenda and presentation for that meeting and can't find anything to do with SHW's plans.  Any help?

 

https://www.cleveland.com/news/2022/12/sherwin-williams-sells-major-stake-in-future-downtown-headquarters-to-florida-developer.html

 

43 minutes ago, Dougal said:

The caption to the rendering in this article alludes to a new design for the crown of the building being approved at the Dec 16th Planning Commission meeting.  I've reviewed the Commission's agenda and presentation for that meeting and can't find anything to do with SHW's plans.  Any help?

 

https://www.cleveland.com/news/2022/12/sherwin-williams-sells-major-stake-in-future-downtown-headquarters-to-florida-developer.html

 

Pretty sure that's just a reused caption from earlier this year where they got approval for lighting and signage. And a sign of their sloppy editing. 

 

https://www.cleveland.com/news/2022/06/sherwin-williams-wins-approval-for-lighting-and-signs-for-downtown-hq-but-city-wants-more-work-on-landscaping-public-amenities.html

It’s almost like having a construction cam, this time lapse is super cool.

 

16 hours ago, Sapper Daddy said:

It’s almost like having a construction cam, this time lapse is super cool.

God, I wish that was longer! It's an awesome angle, as we can see the steel frame make it's way around the core, giving us an idea of just how thicc this bae is going to be!

So, can someone explain to me why a building of this height doesn't seem like its going to have a basement?

7 hours ago, Silent Matt said:

God, I wish that was longer! It's an awesome angle, as we can see the steel frame make it's way around the core, giving us an idea of just how thicc this bae is going to be!

 

I was thinking the floor plates were huge, until I looked at a couple renderings.   On the side closest to and facing W. 6th, the first few floors are bigger than the floor plates starting 4 or 5 floors up.   So the footprint you're seeing won't be that "thicc" all the way to the top of the tower.

It appears that they were removing the "world class" signage from the fencing in that video. lol!

Edited December 24, 20222 yr by dave2017

9 hours ago, jbee1982 said:

So, can someone explain to me why a building of this height doesn't seem like its going to have a basement?

 

 

i dk why, but they don't need one.

they can use a mat foundation+pilings for this height.

although i believe this is around the top height possible without having to dig a traditional skyscraper foundation.

the downside is there will be some settling over the years that will strain the foundation, but generally its fine.

obviously this is a major cost saving move and constrained the tower to the 600 footer range.

 

i also read that other similar sized towers have them too -- here are a couple examples:

 

main tower

frankfurt

656'

 

qipco tower

doha

640'

 

more:

https://www.quora.com/How-much-depth-should-be-provided-for-the-foundations-in-high-rise-buildings

 

18 hours ago, jbee1982 said:

So, can someone explain to me why a building of this height doesn't seem like its going to have a basement?

It doesn't need one. Underground utilities are run under the slab. The footers and column pads are supported by the caissons drilled down to bedrock. The penthouse is where a lot of its mechanical equipment is located. I'm sure a good deal of that equipment is also on the ground floor, which is why the first few floors appear to be so much wider than what the majority of the tower will be.

14 hours ago, JohnSummit said:

 

I was thinking the floor plates were huge, until I looked at a couple renderings.   On the side closest to and facing W. 6th, the first few floors are bigger than the floor plates starting 4 or 5 floors up.   So the footprint you're seeing won't be that "thicc" all the way to the top of the tower.

I’m quite aware, muh man. I’ve been looking at the renders and models too as it’s going up. I’m talking about the steel making it’s way around the core  in clockwise fashion.

In town for the holidays - more SW pics 12-27 

I wonder if the core is at the 100' mark yet (it looks like floors 1-5 are higher than typical office floors).

 

Thanks @CleveFanfor doing the walk-around! I was wondering about the progress on the east side of the core since last week. The steel has almost made it all the way around!

SHW and City Club are both in the 5th-6th floor neighborhood.

nothing better than seeing a nice new building butting right up against the sidewalks. Really gonna add to the city feel of downtown as it closes off that gap on the west part of Public Square.

A bit of a different view from this afternoon. It's really starting to stick out from more places downtown!

On 12/29/2022 at 7:24 PM, Paul in Cleveland said:

A bit of a different view from this afternoon. It's really starting to stick out from more places downtown!

 

Yea! I'm not on the west side much, but was coming back east on 90 yesterday and saw it from the West 140th/I-90 bridge. First time that's happened for me.

They grow up so fast.🥲

 

Drove by this morning and you can see the core already from the Route 2 bridge

Thank God it's glass, too.  We sure need some variety.  

This might be the last rain that ground will ever see.

I was down there last night for the game, This building is going to be fantastic and will make quite a difference in the area! 

Does anyone know why some of he steel is painted white?

3 hours ago, dave2017 said:

Does anyone know why some of he steel is painted white?

Hard to tell from the photos but that might be fireproofing rather than paint.

Weather notwithstanding, the view from the office lunch room is looking better every day 👍

On 1/6/2023 at 6:03 AM, MayDay said:

Hard to tell from the photos but that might be fireproofing rather than paint.

Being a major paint manufacturer, I'm guessing that they have an unlimited and low-cost supply of corrosion control coatings... I'm curious too as to why those I-beams are white.

It's an intumescent paint.  Fabricated in Pittsburgh, then sent to a coatings plant.  As MayDay said, Fireproofing coating.  

On 1/6/2023 at 1:28 PM, MayDay said:

Weather notwithstanding, the view from the office lunch room is looking better every day 👍

When I see this picture I’m more focused on how good the Superior Midway will look down below. You’ll have a front row seat for that project too!

Midway?

Those are some great broad sidewalks down Superior.

I haven't been to one in a while, but will Cleveland's big-city style parades need to travel up Prospect/Huron or 9th, or Lakeside in the future?

Edited January 9, 20232 yr by ExPatClevGuy

Cranes over Cleveland 

43 minutes ago, Mov2Ohio said:

Cranes over Cleveland 

I would like to see this shot again after the two buildings are completed and (hopefully) with a 400-500+ building on the Nucleus site! 

And a 20+ story building across the street.... 🕵️‍♂️

58 minutes ago, Mov2Ohio said:

Cranes over Cleveland 

Nice! 👍 Roof of the 9?

Would love to see S-W rendered into that one!

 

22 minutes ago, KJP said:

And a 20+ story building across the street.... 🕵️‍♂️

I'm gonna have to wait and hear the tea so I can start making previz plans with that photo haha 🙃

From the Soldiers and Sailors monument yesterday. 

3 hours ago, KJP said:

And a 20+ story building across the street.... 🕵️‍♂️

 

From the Nucleus site?  Is Moreno finally going to build the Ferrari Tower?

Today. 3rd level of steel getting started!

On 1/11/2023 at 1:36 PM, MayDay said:

Nice! 👍 Roof of the 9?

Yes sir!

Gotta love blue skies and a new skyscraper. Really coming along!!

Not quite time to bump up that crane - but it's coming. 

 

 

Sherwin-Williams Seeks “Strategic Developments” At HQ

By Ken Prendergast / January 17, 2023

 

When Sherwin-Williams (SHW) finalized a deal last month with Florida-based Benderson Realty Development Co. to buy a big stake in its new global headquarters, the conversations reportedly began with different intentions. According to sources who spoke on the condition of anonymity, those intentions were both more modest and more grand, depending on how one looks it, and could play out further over the coming year.

 

MORE:

https://neo-trans.blog/2023/01/17/sherwin-williams-seeks-strategic-developments-at-hq/

 

This is good to know that the North/South/Phase 2 developments could be developed Sooner rather than Later

So the pavilion is 3 stories?  Did they decide to add another floor?