Depending on how far along SW is, I would assume that they'd still be playing different locations/developer-owners against each other in order to extract the best deal out of the preferred location (assuming they have a preferred location.

 

You're right. I'm hearing S-W is the company and it does have several sites under consideration -- including the Jacobs lot. The Jacobs lot is probably going to command a premium asking price by Jacobs because of where it is. But S-W is a pretty conservative company and, based on their current digs, flashiness doesn't matter to them.

 

Can the Jacobs Group earn more money from a parking lot or from a Fortune 500 company in a skyscraper? One would hope the latter, but.... It's a 188-space parking lot where they charge $10 a car on most days. If every space is filled every day, that's just under $700,000 in gross revenue per year for very little expense -- $172,000 in property tax in 2015 and, at minimum, $71,000 in wages for 24-hour parking attendants. Then there's property and liability insurance, landscaping and maintenance. So it could be a $300,000 annual expense to Jacobs. Will a skyscraper with a Fortune 500 tenant bring in more than several hundred thousand dollars in net income per year?

I haven't seen anyone bring up nuCLEus at all, unless I missed something.  Obviously neither company is in the business of owning a multi-story office building downtown, so they're looking for a developer.  The only one I can think of that has concrete plans that have been presented to the city is nuCLEus.  If one of these companies does not jump on board there, I think you can kiss that project goodbye, at least in the context that it is right now.  I truly think Jacobs smaller lot is marketable to many different uses, while nuCLEus, because of its size, needs a tenant like MM or SW.  Jacobs can build one "tower" atop a garage with maybe 10 floors of office and 15 of condos, and lease/sellout quickly.

 

^Doesn't Sherwin Williams own the Midland Building (and maybe the entire "Landmark Towers" complex)?

 

^^And maybe going through the motions of investigating suburban sites and even other states to extract as much public subsidy as possible.

 

The Landmark office complex is 900,000 square feet and is owned entirely by Sherwin Williams. But a lot of big companies don't like to own their own buildings. Some of that 900,000 sf they lease out (perhaps as much as 100,000 square feet). Yet Sherwin Williams' offices have also spilled over in to the adjoining Skylight office building. So the total office usage by S-W is probably in the neighborhood of 900,000 square feet. That's several times more office space than what nuCLEus had envisioned for its development. And they do have an anchor office tenant.

 

BTW, the parking lot size at the Jacobs lot is about 45,000 square feet. Even the never-built Ameritrust tower wasn't going to have 45,000-square-foot floorplates all the way up its 60 stories. In fact, after they got above the first 12-story pedestal, the rest of the building's floorplates were reduced in size for another 13 floors until the rest of the tower was roughly halved from the pedestal's floorplates...

 

Courtesy of clevelandskyscrapers.com:

^so for 900k sq feet on the Jacobs lot, how many stories would S-W need? 20 if one big block?

^so for 900k sq feet on the Jacobs lot, how many stories would S-W need? 20 if one big block?

 

Figure roughly 30k gross sf per floor.  That's pretty much optimal floor plate for natural light & work area in office towers.  If they are in 900k right now, I'd project that to come down at least 20% with a more modern floor plan.  Those old buildings are crazy inefficient with columns everywhere.  Probably way too many private offices too in the old space

 

The Landmark building would be a great flip to residential.  Perfect location, parking attached, amenities closeby...

  The only one I can think of that has concrete plans that have been presented to the city is nuCLEus.  If one of these companies does not jump on board there, I think you can kiss that project goodbye, at least in the context that it is right now. 

 

 

I made that statement a few weeks ago and was hushed up for spreading rumors & hearsay...

KJP, I saw Benesh mad commitment to nuCLEus, but I didn't hear of an anchor yet.  If that's the anchor you are referring too, they aren't very large for anchor tenancy. 

IMHO, in sure Stark is pitching his development to MM and SW as the only developer that is as far in the planning and development process that could open doors within 3 years.  As far as current square footage that SW currently has, u would not use that as a benchmark for their needs.  They may have some of the most in-efficient square footage in the city contained within extremely antiquated space.  I personally think they could cut square footage with open floor plate design.

^so for 900k sq feet on the Jacobs lot, how many stories would S-W need? 20 if one big block?

 

Figure roughly 30k gross sf per floor.  That's pretty much optimal floor plate for natural light & work area in office towers.  If they are in 900k right now, I'd project that to come down at least 20% with a more modern floor plan.  Those old buildings are crazy inefficient with columns everywhere.  Probably way too many private offices too in the old space

 

The Landmark building would be a great flip to residential.  Perfect location, parking attached, amenities closeby...

 

With 30K sf per floor, that's 30 stories. The proposed Ameritrust tower would have had its parking provided in a deck across West 3rd in the Superblock. That's not possible now with the Weston development proposed for the Superblock today. So it's possible that a 10-story atrium/parking pedestal would have to be incorporated in the tower if built today at the Jacobs lot. A nine-level parking deck with 45,000 sf per level could incorporate about 1,100 spaces in total.

 

 

I made that statement a few weeks ago and was hushed up for spreading rumors & hearsay...

 

Of course. If we wish hard enough, we can get that Jacobs lot built upon! So no distractions! :)

SW will not fit in the Nucleus tower and even if they could, they would take their own building.  If its what everyone is thinking it is, it's a corporate HQ and should be designed as such.

KJP, I saw Benesh mad commitment to nuCLEus, but I didn't hear of an anchor yet.  If that's the anchor you are referring too, they aren't very large for anchor tenancy. 

IMHO, in sure Stark is pitching his development to MM and SW as the only developer that is as far in the planning and development process that could open doors within 3 years.  As far as current square footage that SW currently has, u would not use that as a benchmark for their needs.  They may have some of the most in-efficient square footage in the city contained within extremely antiquated space.  I personally think they could cut square footage with open floor plate design.

 

You're right, Benesch is taking only about one-fourth of the office space component of nuCLEus. But it was enough to give them naming rights. And other office tenants downtown have leased even less of the total office space in their buildings to get naming rights.

 

Maybe "anchor" isn't the right word. But when a tenant gets naming rights to a building, that's "anchor-ish" in my book.

KJP, I saw Benesh mad commitment to nuCLEus, but I didn't hear of an anchor yet.  If that's the anchor you are referring too, they aren't very large for anchor tenancy. 

IMHO, in sure Stark is pitching his development to MM and SW as the only developer that is as far in the planning and development process that could open doors within 3 years.  As far as current square footage that SW currently has, u would not use that as a benchmark for their needs.  They may have some of the most in-efficient square footage in the city contained within extremely antiquated space.  I personally think they could cut square footage with open floor plate design.

 

You're right, Benesch is taking only about one-fourth of the office space component of nuCLEus. But it was enough to give them naming rights. And other office downtown have leased even less of the total office space in their buildings to get naming rights. And maybe "anchor" isn't the right word. But when a tenant gets naming rights to a building, that's "anchor-ish" in my book.

 

Actually, it's becoming fairly common to give more then one company "naming rights".  Instead of the entire building being named for one key tenant, leasors are increasingly offering signage rights for companies to display their logos on one or more of the facades of the building.  You're starting to see multiple logos on one highrise anymore. I wonder how long beofre it looks like a strip mall in the skies!

^ Zoning would probably prohibit any excessive signage on office buildings.

^ Zoning would probably prohibit any excessive signage on office buildings.

 

we can certainly hope so...

Already happening - 800 Superior has signage for both AmTrust and National-something Insurance.

^ I was under the impression that those two were part of the same parent company. The "BP" tower does have Huntington up top and Cliffs on the podium though.

Yes, the city is making some exceptions but they probably have to get special approval for it. I hope it doesn't become very common.

Yeah, don't want signage in a city.

Local investor group pursues purchase of Key Center complex

March 10, 2016

By STAN BULLARD

 

A hometown Cleveland crowd led by developer Scott Wolstein is pursuing the purchase of 57-story Key Tower, the adjoining 25-story Marriott Hotel and landmark Society for Savings Building.

 

In a phone interview Thursday morning, March 10, Wolstein said he believes the property belongs in the hands of Cleveland investors. However, he said he has no certainty he would be able to conclude the purchase.

 

“I don’t have a deal put together worth talking about,” Wolstein said of the complex at 127 Public Square.

 

Wolstein is best known as the developer, with his mother, Iris, and Fairmount Properties of Cleveland, of the Flats at East Bank Neighborhood, an office, retail, hotel and apartment complex that transformed Old River Road north of Main Avenue in the city’s Flats.

 

MORE:

http://www.crainscleveland.com/article/20160310/NEWS/160319977/local-investor-group-pursues-purchase-of-key-center-complex

^is that the correct link?

^is that the correct link?

 

Now it is. Doesn't actually matter what the link is. We all have to go through a google search of the headline to read the article anyway....

Yeah, don't want signage in a city.

 

Unless it's World Class signage

Made a little blog posting summarizing all the stuff that's been said lately about Sherwin-Williams possibly building a new headquarters tower.....

 

SUNDAY, MARCH 13, 2016

Downtown Cleveland's next office tower is in the works

 

During LeBron James' playing time in Miami, residents and visitors to Cleveland got a brief insight as to the headquarters location of one of this city's most successful and enduring corporate citizens. However, the street address of that company could soon change and in a very visible way.

 

The paint and coatings giant Sherwin-Williams (SHW), founded in 1866 in Cleveland, isn't a flamboyant company. The only time it displayed a sign on its headquarters, telling the world what's inside, was in the final year of James' absence. The basketball star's previous 10-story-tall mural gave way to a barren, brick wall for three years. Then in 2013, a similarly sized marker was placed there, suggesting that the company's headquarters was close by. Indeed, the mural hung on SHW's home -- the unfinished side of an 86-year-old collection of three buildings known as the Landmark Office Towers. That unfinished side is where a fourth building, 18 stories tall like the other three, was to be built until the Great Depression halted it.

 

SHW's giant mural pictured above gave way to a new James mural following his 2014 return to Cleveland. SHW's offices returned to anonymity, at least for those who did not already know the firm occupied most of the 900,000-square-foot Landmark Office Towers, which SHW owns. It also owns the land on which its Breen Technology Center sets on Canal Road downtown, roughly where the company was founded.

 

Since the Great Recession, the company has grown quickly -- from $7.8 billion in revenues and earnings per share of $4.19 in 2009 to more than $11.34 billion in revenues and earnings per share of $11.16 in 2015. That's five consecutive years of record sales and four years of record earnings. SHW has outgrown its Landmark home. Now its offices are spilling over like so much paint into a portion of the neighboring Skylight Office Building, a 12-story, 321,000-square-foot building constructed by Forest City Enterprises in 1991. That building is almost entirely full too.

 

MORE:

http://neo-trans.blogspot.com/2016/03/downtown-clevelands-next-office-tower.html

 

Had a little fun with Photoshop, too....

 

I think I would be pretty disappointed if they opted for lowrises along the lakefront instead of a new tower.

^^Jacobs Property please.

Made a little blog posting summarizing all the stuff that's been said lately about Sherwin-Williams possibly building a new headquarters tower.....

 

SUNDAY, MARCH 13, 2016

Downtown Cleveland's next office tower is in the works

 

During LeBron James' playing time in Miami, residents and visitors to Cleveland got a brief insight as to the headquarters location of one of this city's most successful and enduring corporate citizens. However, the street address of that company could soon change and in a very visible way.

 

The paint and coatings giant Sherwin-Williams (SHW), founded in 1866 in Cleveland, isn't a flamboyant company. The only time it displayed a sign on its headquarters, telling the world what's inside, was in the final year of James' absence. The basketball star's previous 10-story-tall mural gave way to a barren, brick wall for three years. Then in 2013, a similarly sized marker was placed there, suggesting that the company's headquarters was close by. Indeed, the mural hung on SHW's home -- the unfinished side of an 86-year-old collection of three buildings known as the Landmark Office Towers. That unfinished side is where a fourth building, 18 stories tall like the other three, was to be built until the Great Depression halted it.

 

SHW's giant mural pictured above gave way to a new James mural following his 2014 return to Cleveland. SHW's offices returned to anonymity, at least for those who did not already know the firm occupied most of the 900,000-square-foot Landmark Office Towers, which SHW owns. It also owns the land on which its Breen Technology Center sets on Canal Road downtown, roughly where the company was founded.

 

Since the Great Recession, the company has grown quickly -- from $7.8 billion in revenues and earnings per share of $4.19 in 2009 to more than $11.34 billion in revenues and earnings per share of $11.16 in 2015. That's five consecutive years of record sales and four years of record earnings. SHW has outgrown its Landmark home. Now its offices are spilling over like so much paint into a portion of the neighboring Skylight Office Building, a 12-story, 321,000-square-foot building constructed by Forest City Enterprises in 1991. That building is almost entirely full too.

 

MORE:

http://neo-trans.blogspot.com/2016/03/downtown-clevelands-next-office-tower.html

 

Had a little fun with Photoshop, too....

 

 

Way sawed off clone of the proposed Ameritrust tower?

Sawed off, but I think it looks great KJP.  Nice work, and blog.  Is that image with the tower on Jacobs lot?

Sawed off, but I think it looks great KJP.  Nice work, and blog.  Is that image with the tower on Jacobs lot?

 

Thanks. Yes.

 

Way sawed off clone of the proposed Ameritrust tower?

 

Yes, below is the original graphic by Evan Heintges. I had to "finish" Key Tower to modernize the image but other than remove the construction crane from the Marriott, I didn't finish that building as I ran out of energy.

 

Looking at that proposed Ameritrust tower it isn't very appealing. Kind of glad it didn't get built. Even though a building on that lot would do wonders a better design was needed imo.

Although I would love to have two more towers in CLE, the design for Key is far superior to Ameritrust and Progressive's proposed buildings IMO.

Although I would love to have two more towers in CLE, the design for Key is far superior to Ameritrust and Progressive's proposed buildings IMO.

 

Key really does pass the test of time after her first 25 years.  Still a good looking building.

Although I would love to have two more towers in CLE, the design for Key is far superior to Ameritrust and Progressive's proposed buildings IMO.

 

Key really does pass the test of time after her first 25 years.  Still a good looking building.

 

it didn't try to be trendy.  That's why.

My graphic was intended as more of a massing to show how a 40-story building with floorplates averaging about 30,000 sf would look on the Jacobs lot. Although the decorative feature (which may be covering some rooftop mechanicals) makes the building seem about seven stories taller. Perhaps a new tower would have that (like Key Tower) but we just don't know.

Wow that was 40 stories? Key Tower seems massive! I would have guessed 30-35 stories.

Since this is a news and speculation thread, I've got a speculation question for the forum members...

 

Among the NE Ohio companies with a headquarters located in the suburbs, which one do you think is most likely to relocate its headquarters downtown, or at least a significant (ie: hundreds of employees) portion of its office workers downtown? This can be a large or a small/medium company. But since I'm not familiar with many of the small/medium companies that may have grand visions, I haven't listed them here. But don't let me stop you from offering up a few suggestions of your own!

 

Note: some of the employees listed are not office workers, but instead are manufacturing, warehousing or retailing employees who aren't candidates for relocation to a downtown office....

 

+ JPMorgan Chase & Co. -- Beachwood -- 21,000 Ohio employees

 

+ Progressive Insurance -- Mayfield Village -- 9,300 local employees -- (considered HQ tower downtown in 1990)

 

+ Group Management Services -- Richfield -- 8,900 local employees (10,000 nationwide) -- founded in 1996

 

+ PolyOne Corp. -- Avon Lake -- 7,300 employees -- $3.8 billion annual revenues (merged Geon of Avon Lake and MA Hanna of downtown Cleveland in 2000)

 

+ Swagelok Company -- Solon, OH -- 4,200 local employees

 

+ Parker Hannifin Corp. -- Mayfield Hts -- 3,520 local employees

 

+ Discount Drug Mart, Inc. -- Medina, OH -- 3,500 local employees

 

+ Lincoln Electric Holdings, Inc. -- Euclid -- 3,000 local employees

 

Got any others?

Since this is a news and speculation thread, I've got a speculation question for the forum members...

 

Among the NE Ohio companies with a headquarters located in the suburbs, which one do you think is most likely to relocate its headquarters downtown, or at least a significant (ie: hundreds of employees) portion of its office workers downtown? This can be a large or a small/medium company. But since I'm not familiar with many of the small/medium companies that may have grand visions, I haven't listed them here. But don't let me stop you from offering up a few suggestions of your own!

 

Note: some of the employees listed are not office workers, but instead are manufacturing, warehousing or retailing employees who aren't candidates for relocation to a downtown office....

 

+ JPMorgan Chase & Co. -- Beachwood -- 21,000 Ohio employees

 

+ Progressive Insurance -- Mayfield Village -- 9,300 local employees -- (considered HQ tower downtown in 1990)

 

+ Group Management Services -- Richfield -- 8,900 local employees (10,000 nationwide) -- founded in 1996

 

+ PolyOne Corp. -- Avon Lake -- 7,300 employees -- $3.8 billion annual revenues (merged Geon of Avon Lake and MA Hanna of downtown Cleveland in 2000)

 

+ Swagelok Company -- Solon, OH -- 4,200 local employees

 

+ Parker Hannifin Corp. -- Mayfield Hts -- 3,520 local employees

 

+ Discount Drug Mart, Inc. -- Medina, OH -- 3,500 local employees

 

+ Lincoln Electric Holdings, Inc. -- Euclid -- 3,000 local employees

 

Got any others?

 

We've talked a lot about Progressive already, but I definitely think you can rule out any of the manufacturing companies such as Parker Hannifin, Swagelok, PolyOne, and Lincoln.  The last three in particular, because they have local manufacturing facilities and separating the HQ from the plants runs contrary to current trends in domestic manufacturing.

Lubrizol. Wickliffe & Brecksville. About 2,000 people. Mainly desk jobs, but zero chance of moving downtown.

What about JoAnn Fabric? IDK if they have operations/factory at their Hudson location.

Damn. Forgot about Lubrizol. Oh well.

 

Of the big manufacturers, I would think Parker Hannifin may be the most likely to relocate downtown. They continue to be active sponsors of downtown activities and other things, like the new downtown YMCA.

 

There's a growing company in Middleburg Hts that I've been trying to remember the name of -- the founder of that company has made his intentions known of relocating downtown when his firm grows large enough to justify a stand-alone tower.

KJP, I doubt any of them are likely to relocate downtown, but some other significant companies with suburban HQs include Nordson (in Westlake), Highland Software (Westlake), Invacare (Elyria), RPM (Medina), and Travel Centers of America (Westlake).

 

EDIT: also Safeguard Properties (Valley View), which is probably one of the largest closely held companies in the area at this point.

Finance seems a more likely sector than manufacturing, since they're office-only operations. 

 

Moves from the Beachwood-Mayfield area seem less likely due to Chagrin Valley proximity.  Executives in those wealthy burbs prefer having their own "downtown" because the real one is nearly an hour commute vs 5-10 minutes.

BTW, I also forgot about Amsdell Cos. which was in Middleburg Heights but recently moved to Grayton Road in Cleveland.

Of the big manufacturers, I would think Parker Hannifin may be the most likely to relocate downtown. They continue to be active sponsors of downtown activities and other things, like the new downtown YMCA.

 

A few years ago I worked for one of their suppliers and now I am a customer. 

 

The chances of this are about zero.  Maybe a small sales, legal,  or financial office, but that would be it.

 

A manufacturer, especially one that sells to other manufacturers, rarely  if ever gains benefits from being downtown that offset the costs.

Two other big companies that are in the outlying parts of Cleveland that would be great additions Downtown:  First Energy (parent of CEI) and Goodyear.

Millennia Housing has talked about moving downtown in previous articles

Two other big companies that are in the outlying parts of Cleveland that would be great additions Downtown:  First Energy (parent of CEI) and Goodyear.

 

These two would effectively kill Akron, which this region can't afford to have happen.

(Edit) Goodyear just finished their new hq and aren't going anywhere. First Energy is probably getting a new HQ in the next few years in downtown Akron. I highly doubt they will move North as they have built the electrical infrastructure of downtown Akron to withstand blackouts.

Out of the Akron area, the only company i could maybe see getting a small hq in Cleveland would be Sterling Jewelers. They are a UK company I believe so they don't really have any serious ties to Summit County. I know they have grown quite a bit over the years with all their mergers. They would probably keep most of their backoffice operations in Akron.  It may make sense foe them to have a high profile corporate office in a nice shiny tower on the lake.

Out of the Akron area, the only company i could maybe see getting a small hq in Cleveland would be Sterling Jewelers. They are a UK company I believe so they don't really have any serious ties to Summit County. I know they have grown quite a bit over the years with all their mergers. They would probably keep most of their backoffice operations in Akron.  It may make sense foe them to have a high profile corporate office in a nice shiny tower on the lake.

 

I'd imagine all their execs live down there, so they wouldn't want to commute to Cleveland.  Also, pretty sure they built a new building down there a few years ago.

 

EDIT: From their 10-K report, which probably has most extensive "Properties" description I have ever seen:

"A 375,000 square foot head office and distribution facility is leased in Akron, Ohio through 2032. An 86,000 square foot office building next door to the head office is also leased through 2032, to which Signet relocated its credit operations in Fiscal 2013. A 78,000 square foot warehouse space in Barberton, Ohio for non-merchandise fulfillment is leased through 2017. Signet owns a 38,000 square foot repair center which was opened in Akron, Ohio during Fiscal 2006. In 2014, an agreement was signed to lease a 4,600 square foot diamond design office in New York City through 2020. A 32,000 square foot office in Akron, Ohio was also leased through 2019, to which certain corporate functions relocated in 2014."

Note that some corp offices are leased til 2019. That would be the exact time-frame KJP is talking about. Also, most execs live probably in Bath and Hudson area. That would not be a tough commute. People that are further away could easily afford to move.

Also, most execs live probably in Bath and Hudson area. That would not be a tough commute. People that are further away could easily afford to move.

 

I would say it's both.  There's a diagonal swath of wealth that runs roughly SW from Willoughby Hills into Medina County.  Execs in the Summit/Medina area might be more amenable to Independence, but that doesn't represent nearly the same commute differential for downtown.  Eastern Cuyahoga presents a rare combo of office density and high-end exurban housing right next to each other, so if that's the lifestyle you want, and you can afford it, downtown might be a particularly hard sell.

Also, most execs live probably in Bath and Hudson area. That would not be a tough commute. People that are further away could easily afford to move.

 

I would say it's both.  There's a diagonal swath of wealth that runs roughly SW from Willoughby Hills into Medina County.  Execs in the Summit/Medina area might be more amenable to Independence, but that doesn't represent nearly the same commute differential for downtown.  Eastern Cuyahoga presents a rare combo of office density and high-end exurban housing right next to each other, so if that's the lifestyle you want, and you can afford it, downtown might be a particularly hard sell.

 

True.  A good part of that area is the "borderlands" of northern Summit County, technically part of metro Akron with no particular allegiance to either city.

 

That said, I doubt Cleveland would try to poach Akron because it looks hypocritical when it fights poaching itself.