On 11/20/2022 at 1:32 PM, LibertyBlvd said:

Agreed, but how will it happen? They couldn't even get East Cleveland to agree to annexation. 

I think with the East Cleveland example it was the other way around. EC was acting like it was Shaker or Strongsville with its list of demands, and not the city desperately hanging on to its independence that it really is, so Cleveland passed.

 

To get other cities to buy in, the benefits of a merger need to be explained  to residents. Details on how services will be effected and maintained, how will school's be set up need to be throughly explained. There was talk of getting rid of RITA, maybe that could be used to try to sweeten the pot.

 

Merging is not a bad idea, just nobody has taken it seriously enough to address all the positives and negatives and turn it into a political/ballot issue.

We have a topic for this.

I'm going to move this from @Dougal to this thread....

 

Quote

9 minutes ago, Dougal said:

The FT today has an article about "zombie" office buildings, as @KJP has been calling them for years, in New York City.  Apparently, the office buildings there are still 50% vacant in terms of workers, although not yet in terms of square footage leased.  Building values are weakening based on a couple of recent sales. Rolling over debt at today's interest rates and declining asset valuation is difficult for property owners. Meta has walked out on a 250K sq ft lease in Hudson Yards.  Vornado stock down 50%. The FT predicts a grim 2023 for NYC real estate.

 

I wish I could claim credit for the name "Zombie" office buildings. But it's very apropos.

 

Crain's recently ran an article saying the Cleveland office market isn't that bad. The amount of subleasing offers out there suggests that it is. When many current leases expire, I think it's going to be a day of reckoning for many landlords. On the good side, having so many Class B and C properties go on the market at the same time could allow developers to pick up some properties for a good price and reposition them either as Class A office properties, residential or a mix. If Bedrock tries to build a trophy class office tower that's at least 500k sf as part of its riverfront development, it's going to create ripples throughout the entire downtown office market. The flight to quality and increased inventory is going to result in tenants being able to afford moving up to nicer buildings with the lesser buildings being forced into conversions.

I do worry that fewer jobs downtown will eventually hurt the residential rental market - at least to some extent. 

 

a lot of people rent downtown because it was close to their work.

23 minutes ago, Whipjacka said:

I do worry that fewer jobs downtown will eventually hurt the residential rental market - at least to some extent. 

 

a lot of people rent downtown because it was close to their work.

Not specific to Cleveland, but several people I know who live downtown or close in prefer it because of the "reverse commute" - going against the traffic to work in the suburbs, and back home to the city. 

25 minutes ago, westerninterloper said:

Not specific to Cleveland, but several people I know who live downtown or close in prefer it because of the "reverse commute" - going against the traffic to work in the suburbs, and back home to the city. 

But if the exodus of downtown workers continues, will the "reverse commute" no longer be going against the traffic?

18 minutes ago, LibertyBlvd said:

But if the exodus of downtown workers continues, will the "reverse commute" no longer be going against the traffic?

The office jobs aren't going from downtown to the suburbs; they're going from downtown to the dining room table. Suburbs are having the same problems with leasing, which will probably benefit downtown more than the suburbs since one advantage of suburbs is cost, and prices would be going down across the board, thereby lessening the cost advantage to suburbs.

1 hour ago, Whipjacka said:

I do worry that fewer jobs downtown will eventually hurt the residential rental market - at least to some extent. 

 

a lot of people rent downtown because it was close to their work.

I’ll admit that I don’t know the other 19,950 people who live downtown, but of the 50 or so that I do know, not one of them also works downtown. Everyone is either a long-standing work from homer, or reverse commuter.  I’m one of those people who would absolutely love to find a job at an office downtown, but fits for what I do & need are few and far between. 

14 minutes ago, roman totale XVII said:

I’ll admit that I don’t know the other 19,950 people who live downtown, but of the 50 or so that I do know, not one of them also works downtown. Everyone is either a long-standing work from homer, or reverse commuter.  I’m one of those people who would absolutely love to find a job at an office downtown, but fits for what I do & need are few and far between. 

I have to say I really find that fascinating.

12 minutes ago, Htsguy said:

I have to say I really find that fascinating.

I’ve lived and worked downtown for the last 16 years. Maybe I’m a minority. My wife is a big city non Ohioan and she wanted to live in the city. I think I put 3,000 miles a year on my car and that also includes my wife occasionally driving my car to work in the suburbs.

A friend of mine moved from Chicago to Cleveland last year is back in Chicago for job training. He's staying and training downtown and says that the traffic activity on the streets, sidewalks and rail stations are all close to pre-pandemic levels.

5 hours ago, LlamaLawyer said:

The office jobs aren't going from downtown to the suburbs; they're going from downtown to the dining room table. Suburbs are having the same problems with leasing, which will probably benefit downtown more than the suburbs since one advantage of suburbs is cost, and prices would be going down across the board, thereby lessening the cost advantage to suburbs.

Um did you complete miss the fact that Sherwin's R&D and Medical Mutual are both sending thousands of employees from downtown into the suburbs? Alot of jobs maybe remote, but downtown (and cleveland proper in general) is still losing a staggering amount of jobs and taxes to its suburbs. 

DCA says 60 percent of office workers have returned downtown. They must all live downtown and walk to work because RTA rail ridership at Tower City station is down 80+ percent and there is no traffic on the highways into downtown anymore.....

 

 

18 minutes ago, KJP said:

DCA says 60 percent of office workers have returned downtown. They must all live downtown and walk to work because RTA rail ridership at Tower City station is down 80+ percent and there is no traffic on the highways into downtown anymore.....

 

 

 

ODOT claimed there was 100k+ cars traveling on I-90 daily as recently as July. I assumed those were mostly commuters...

 

If this is the traffic volume during rush hour do we really need I-90 running through Cleveland still?

10 minutes ago, Luke_S said:

 

ODOT claimed there was 100k+ cars traveling on I-90 daily as recently as July. I assumed those were mostly commuters...

 

If this is the traffic volume during rush hour do we really need I-90 running through Cleveland still?

I reverse commute from work back home at 8am everyday and 90 is usually backed up to passed East 42nd. Unsure if those cars are just all going on I71 south or downtown or what. 

I can see 77 and the innerbelt from my window.  There is traffic, slightly down from pre-covid.  Cleveland traffic wasnt heavy before covid

15 hours ago, AsDustinFoxWouldSay said:

Um did you complete miss the fact that Sherwin's R&D and Medical Mutual are both sending thousands of employees from downtown into the suburbs? Alot of jobs maybe remote, but downtown (and cleveland proper in general) is still losing a staggering amount of jobs and taxes to its suburbs. 

Okay. And Cross Country is moving downtown. These are just anecdotes.

 

https://www.avisonyoung.us/documents/91132/100685724/Cleveland+Quarterly+Office+Market+Report+-+Q2+2022_final_v2.pdf/6fde63aa-b737-d4aa-c2de-7c10e7ce0f80?t=1659539558011

 

^According to this report, as of Q2 2022, downtown vacancy is lower than suburban and suburban net absorption is worse than downtown according to the above report.

 

https://www.us.jll.com/content/dam/jll-com/documents/pdf/research/americas/us/q3-2022-office-insights/jll-us-office-insight-q3-2022-cleveland.pdf

 

^This report shows higher vacancy downtown (unclear the reason for the discrepancy), but it still shows absorption rate is better downtown than in the suburbs.

 

https://www.svnsummitcommercial.com/market-trends/cleveland office market report pdf.pdf

 

^This one agrees that suburban vacancy is lower but states that CBD is doing impressively well. It doesn't list net absorption, but says "the largest recent leases inked throughout the market have been for Class A space in the CBD. Should rising demand for higher-tier floorplans accelerate in the near term, existing properties with availabilities stand to benefit."

 

So based on the above, our optimism should definitely be tempered. You won't hear me saying  "DOWNtoWn growth IS GOing to crUsh ThE SubURban OffICe marKET!! beaChwOOd Is TOast!!"

 

But I don't think the data bears out "losing a staggering amount of jobs and taxes to [the] surburbs."

 

If you have contrary data that suggests downtown office market really is toast, and the suburbs are going to eat downtown's lunch, I'm interested to hear it.

3 hours ago, KJP said:

DCA says 60 percent of office workers have returned downtown. They must all live downtown and walk to work because RTA rail ridership at Tower City station is down 80+ percent and there is no traffic on the highways into downtown anymore.....

 

How much of that "60 percent" of office workers who have "returned" downtown are coming to the office five days a week?  I've heard about a lot of places that are letting workers work from home two or three days a week.  That could account for some of the discrepancy in traffic/transit.

^I live downtown and reverse commute. IME Tuesday is very clearly the busiest day for traffic and people coming into downtown. Weds and Thurs are somewhat busy. Monday quiet. Friday dead. 

On 12/6/2022 at 12:28 PM, Foraker said:

 

How much of that "60 percent" of office workers who have "returned" downtown are coming to the office five days a week?  I've heard about a lot of places that are letting workers work from home two or three days a week.  That could account for some of the discrepancy in traffic/transit.

This is likely the right answer. My company is hybrid and we can choose our days in the office, most people have chosen some combination of Tuesday-Thursday to be downtown (including me) with Monday and Friday as remote. The amount of traffic (and foot traffic) varies wildly depending on the day. Some days it's basically pre-COVID levels, other days it's pretty dead. Usually the mid-week days are the busiest, but even that's highly variable. I've been in the office on a few random Mondays or Fridays and it's been both busier than a midweek day or completely dead. This just seems to be the reality of the hybrid work environment.

 

I've been working downtown for over a decade at this point, and even the "dead" days right now seem to be more active than a normal day back when I first started.

 

Postmortem on Medical Mutual’s HQ decision

By Ken Prendergast / December 27, 2022

 

The decision for Medical Mutual of Ohio to abandon its downtown Cleveland headquarters for suburban Brooklyn was apparently less of a strategic move and more of a matter of which city’s public incentives got used first. And according to a local real estate insider, it was a short-term decision that could end up biting the Fortune 1000 company and downtown in their hind ends in the long term.

 

MORE 

https://neo-trans.blog/2022/12/27/postmortem-on-medical-mutuals-hq-decision/

 

 

Seeds & Sprouts XXV — Park Place Tech Stays, LaSalle Theater Available, Grant Thornton Moving
By Ken Prendergast / January 13, 2023

 

Chicago-based Grant Thornton International Ltd., America’s sixth-largest accounting organization, is moving its Cleveland office from the 31-story One Cleveland Center, 1375 E. 9th St., to the 45-story 200 Public Square in downtown Cleveland. According to a recent filing with the Cleveland Building Department, the audit, tax and financial advisory firm will invest about $1.25 million to retrofit 8,972 square feet of office space in Cleveland’s third-tallest skyscraper. The change represents a significant reduction — by more than half — in office space for the company.

 

MORE:

https://neo-trans.blog/2023/01/13/seeds-sprouts-xxv-park-place-tech-stays-lasalle-theater-available-grant-thornton-moving/

 

8 hours ago, KJP said:

 

Seeds & Sprouts XXV — Park Place Tech Stays, LaSalle Theater Available, Grant Thornton Moving
By Ken Prendergast / January 13, 2023

 

Chicago-based Grant Thornton International Ltd., America’s sixth-largest accounting organization, is moving its Cleveland office from the 31-story One Cleveland Center, 1375 E. 9th St., to the 45-story 200 Public Square in downtown Cleveland. According to a recent filing with the Cleveland Building Department, the audit, tax and financial advisory firm will invest about $1.25 million to retrofit 8,972 square feet of office space in Cleveland’s third-tallest skyscraper. The change represents a significant reduction — by more than half — in office space for the company.

 

MORE:

https://neo-trans.blog/2023/01/13/seeds-sprouts-xxv-park-place-tech-stays-lasalle-theater-available-grant-thornton-moving/

 

As far as I know, One Cleveland Center is the last of Optima Ventures local properties. (The group funded by corrupt Ukrainian oligarchs that previously owned a half dozen downtown properties, including the Westin and the future Centennial.) losing a tenant probably puts it one step closer to being owned by someone else, which would be a good thing. 

We are not alone. In downtown Toronto, its merchants started a campaign to ask the city to force downtown-based companies to end remote working.

 

13 minutes ago, KJP said:

We are not alone. In downtown Toronto, its merchants started a campaign to ask the city to force downtown-based companies to end remote working.

 

 

So the government should force unwilling companies to make their employees do something they don't wish to do, in order to maintain the existing business models of third parties?

Sounds like a recipe for moving offices out to the suburbs, or electing less interventionist governments.

Companies allowed Remote working in response to Covid. It wasn't supposed to be permanent. 

39 minutes ago, LibertyBlvd said:

Companies allowed Remote working in response to Covid. It wasn't supposed to be permanent. 

 

It was already happening to a degree before the virus.   Like many trends, the virus accelerated it but did not start it.

 

It should be entirely up to the company and its employees.

 

One thing you (should) learn in the service industry is you aren't entitled to guaranteed profitability of your existing business model.

Yes, I realize that. At my previous place of employment, a co-worker moved to Nevada and was allowed to continue working with the company remotely. I gotta say it was a bit of a pain collaborating with him on projects that way.

 

Edited January 29, 20232 yr by LibertyBlvd

2 hours ago, E Rocc said:

 

So the government should force unwilling companies to make their employees do something they don't wish to do, in order to maintain the existing business models of third parties?

Sounds like a recipe for moving offices out to the suburbs, or electing less interventionist governments.

I didn’t take that as @KJP advocating for the policy; rather, it was a comment that downtown retail struggles are not unique to Cleveland. 

2 hours ago, Boomerang_Brian said:

I didn’t take that as @KJP advocating for the policy; rather, it was a comment that downtown retail struggles are not unique to Cleveland. 

 

I didn't either.   The question was aimed at those who do advocate such.

 

Such far reaching expansions of government authority almost always have unintended consequences quite contrary to the original intent.

Edited January 29, 20232 yr by E Rocc

5 hours ago, E Rocc said:

 

So the government should force unwilling companies to make their employees do something they don't wish to do, in order to maintain the existing business models of third parties?

 

Here's a business model: lower the rent so businesses can afford moving into the vacant storefronts. 

WFH is an example of an issue where the opposite choices are both correct. 

 

WFH is something that many (most?) workers want access too. Workers appreciate the freedom and flexibility. Companies may save money by needing less office space. Less commuting is environmentally helpful. Not allowing it can make it hard for companies to recruit talent. WFH is great. Except for the huge negative impact on city activity, retail, tax base and overall city ambience. 

 

Does WFH have a significant and deleterious impact on cities? Yes it does.

 

Should government mandate that WFH be outlawed because it has a deleterious impact on cities? The answer is No.  

 

What's good for employees is bad for cities. But getting rid of it is both good and bad. WFH is a conundrum.

23 hours ago, KJP said:

We are not alone. In downtown Toronto, its merchants started a campaign to ask the city to force downtown-based companies to end remote working.

 

This is why I think a lot of people were very outspoken with regard to the shut downs.  I didn't know where to stand on the issue, however what I did know was, the landscape was going to be vastly different once the pandemic ended.  And probably not for the better for large urban cores.  And to think that a city could force business' what to do with regard to where their employees work, IMHO, is ridiculous.  Places such as DC and other high rent districts could really struggle now.  If I was leasing a large footprint right now, and just adapted all of my employees to remote working, not a chance I would continue to pull huge rents out of my PnL.  However, money fixes everything, and if cities want to incentivize business to get their employees back to work in the physical location, they can do that through tax breaks I guess.  Another blow however. 

 

Seeds & Sprouts XXVI – UC tech building, EOC going downtown, Tech Ready Mix buys land
By Ken Prendergast / February 7, 2023

 

The Cleveland chapter of the 1993-founded Entrepreneurs’ Organization is opening offices and meeting facilities downtown after having little more than a mailbox at Clemens Corporate Park on Clemens Road in Westlake. According to a building permit application submitted to the City of Cleveland last week, EO Cleveland will invest approximately $250,000 to establish a 4,121-square-foot office at 1020 Bolivar Ave. in the Gateway District. HSB Architects + Engineers of Cleveland is providing design services for the renovation work that includes non-structural architectural and mechanical-electrical-plumbing elements.

 

MORE

https://neo-trans.blog/2023/02/07/seeds-sprouts-xxvi-uc-tech-building-eoc-going-downtown-tech-ready-mix-buys-land/

Pretty big

 

 

1 minute ago, KJP said:

Pretty big

 

 

I hope it’s good news!

2 minutes ago, KJP said:

Pretty big

 

 

 

Good big or bad big?

Perhaps related to Ernst & Young spinning off consulting into a new organization?

https://www.reuters.com/business/finance/ey-expects-massive-approval-vote-split-up-company-2023-02-14/

2 hours ago, federer_1984 said:

Perhaps related to Ernst & Young spinning off consulting into a new organization?

https://www.reuters.com/business/finance/ey-expects-massive-approval-vote-split-up-company-2023-02-14/

That would be nice if they used the separation to have the accounting firms headquartered in Cleveland - just like in the old Ernst & Whinney days.

Sorry for the delay. Had to pick up my son from school......

 

 

EY moving across downtown
By Ken Prendergast / February 14, 2023

 

Although rumored for weeks, the announcement that EY (formerly Ernst & Young) is moving its offices out of one of only two trophy-class buildings in downtown Cleveland still came as a surprise to some longtime real estate executives. The 23-story office tower at 950 Main Ave. at Flats East Bank that bears Ernst & Young’s name has been one of downtown’s most expensive and successfully leased since it opened in 2013.

 

MORE:

https://neo-trans.blog/2023/02/14/ey-moving-across-downtown/

They got some lease discounts for sure for that move. I have worked in both buildings and North Point a significant downgrade from EY tower.

Cross-posted in the Random Cleveland Developments thread

 

 

More downtown firms making moves

By Ken Prendergast / March 5, 2023

 

Three legal and financial service firms in downtown Cleveland are on the move to new addresses in the central business district, with two firms seeking smaller spaces as part of an ongoing trend by many office-based employers to downsize their work spaces after the pandemic. The third firm moved to accommodate significant new growth in Cleveland. And each firm is staying downtown, investing in their new office locations, with none of the three seeking a reduction in employment. Indeed, even as some office spaces shrink, the number of employees at those tenants’ aren’t shrinking. Instead, they are taking advantage of remote working and web-based contact with clients.

 

MORE:

https://neo-trans.blog/2023/03/05/more-downtown-firms-making-moves/

^ as far as i see any bits of office downsizing just means more opportunities for residential conversions and mixes, which frankly cleveland has been an impressive and confident leader in doing (for contrast, in eastside midtown nyc where the older office buildings are located, they just wring their hands and fret).

3 hours ago, mrnyc said:

^ as far as i see any bits of office downsizing just means more opportunities for residential conversions and mixes, which frankly cleveland has been an impressive and confident leader in doing (for contrast, in eastside midtown nyc where the older office buildings are located, they just wring their hands and fret).

 

And that's how you bring it back, people who live down there are going to be far more interested in working down there.   Not by trying to force companies to do something neither they nor their staff wish to do.

people have always been attracted to living close to work, suburbia is a relatively modern development, being spurred by streetcars and autos. old cleveland in particular was well built in that live close to work form, back when people walked out of their home and took their lunch pail down the block to the machine shop or whatever factory.

 

as downtowns everywhere are booming, maybe we are finally stearing back to a modern version of that model.

 

of course the biggest issue by far for the clev isn't office space or hybrid offices, its to build back the population. good news is it seems to me all these things are happening together at a decent rate. i wish it was at a columbus rate, but sorry lets not go there lol.

12 hours ago, E Rocc said:

 

And that's how you bring it back, people who live down there are going to be far more interested in working down there.   Not by trying to force companies to do something neither they nor their staff wish to do.

 

Have to admit I admire Sherwin Williams approach of 'encouraging' their suppliers to take offices next door.  🙂

11 hours ago, mrnyc said:

people have always been attracted to living close to work, suburbia is a relatively modern development, being spurred by streetcars and autos. old cleveland in particular was well built in that live close to work form, back when people walked out of their home and took their lunch pail down the block to the machine shop or whatever factory.

 

as downtowns everywhere are booming, maybe we are finally stearing back to a modern version of that model.

 

of course the biggest issue by far for the clev isn't office space or hybrid offices, its to build back the population. good news is it seems to me all these things are happening together at a decent rate. i wish it was at a columbus rate, but sorry lets not go there lol.

 

People had to live close to work, they may or may not been attracted to it.   It's important to note the distinction.   That need isn't coming back any time soon.

4 hours ago, Dougal said:

 

Have to admit I admire Sherwin Williams approach of 'encouraging' their suppliers to take offices next door.  🙂

 

If I'm not mistaken, they don't do any manufacturing in this area.   A supplier is more likely to visit plants than HQ, or in this case the research center.  If they are doing this it's kind of symbolic.

1 hour ago, E Rocc said:

 

People had to live close to work, they may or may not been attracted to it.   It's important to note the distinction.   That need isn't coming back any time soon.

 

of course they did — and today downtowns have been a-boomin. it’s back to the future — with a modern twist.