Interesting stuff...

 

55 Public Square shows only 77,237 SF available. Don't see how CPD can fit in there...

http://www.loopnet.com/Listing/9746264/55-Public-Sq-Cleveland-OH/

 

The Ritz Hotel building has so much office space available. It apparently all became available at the same time -- in March of this year:

 

250 W Huron Rd

Cleveland, OH 44113 · 109,072 SF Available

http://www.loopnet.com/Listing/20229350/250-W-Huron-Rd-Cleveland-OH/

 

Eight floors (26-33) of the 35-story PNC building appear to be empty, totaling 163,000 SF:

 

1900 E 9th Street

Cleveland, OH 44114 · Office For Lease

http://www.loopnet.com/Listing/19112609/1900-E-9th-Street-Cleveland-OH/

 

Look at how much space is listed as available in the AECOM building, although not much of it is contiguous...

 

1300 E 9th St

Cleveland, OH 44114 · 231,854 SF AVAILABLE

http://www.loopnet.com/Listing/18277324/1300-E-9th-St-Cleveland-OH/

I just realized there's an older building that's not on that list and has hundreds of thousands of square feet available for an office user(s). This has to be on the radar of the CPD, MM and others searching for a large block of office space...

 

200 Euclid Avenue, Cleveland, OH 44114

 

Description

Prime Retail Space | Former May Company location, 200 Euclid Avenue, Downtown Cleveland.

Entire Building - 760,000 SF of office available in building. Potential mixed-use redevelopment.

 

http://www.loopnet.com/Listing/17661780/200-Euclid-Avenue-Cleveland-OH/

 

Odd that they are showing it from the "rear", i.e the Prospect side of the building.  Because they wanted Terminal and Key in the picture?

Southland Engineering opens Cleveland office

 

Southland Engineering has opened a new office — its seventh overall — in downtown Cleveland.

 

The engineering firm's new Midwestern outpost is located in the Fifth Third Building at 600 Superior Ave. East. It is led by principal engineer Mark Crawford, nearly a 30-year veteran of the industry whose resume includes projects such as the Carl R. Darnall Army Medical Center in Fort Hood, Texas, and M Resort in Las Vegas, according to Southland's website.

 

http://www.crainscleveland.com/article/20170711/NEWS/170719944/southland-engineering-opens-cleveland-office?utm_campaign=socialflow&utm_source=twitter&utm_medium=social

Cleveland-based cleaning firm sold for $1.25 billion

July 12, 2017 UPDATED 3 HOURS AGO

By STAN BULLARD   

 

ABM Industries Inc. (NYSE: ABM), a mammoth New York City-based provider of building-related services from cleaning to parking, has agreed to acquire for $1.25 billion GCA Services Group, a Cleveland-based provider of cleaning and related services with 37,000 employees across the nation.

 

The sellers of GCA are affiliates of Thomas H. Lee Partners LP of Boston and Goldman Sachs Merchant Banking Division of New York City. The private equity firms agreed to sell it for $851 million in cash and $399 million in shares of ABM common stock in the proposed transaction announced Wednesday, July 12.

 

The private equity groups will own about 14% of ABM's outstanding stock if the acquisition closes.

 

MORE:

http://www.crainscleveland.com/article/20170712/NEWS/170719927/cleveland-based-cleaning-firm-sold-for-1-25-billion

Cleveland-based cleaning firm sold for $1.25 billion

July 12, 2017 UPDATED 3 HOURS AGO

By STAN BULLARD   

 

ABM Industries Inc. (NYSE: ABM), a mammoth New York City-based provider of building-related services from cleaning to parking, has agreed to acquire for $1.25 billion GCA Services Group, a Cleveland-based provider of cleaning and related services with 37,000 employees across the nation.

 

The sellers of GCA are affiliates of Thomas H. Lee Partners LP of Boston and Goldman Sachs Merchant Banking Division of New York City. The private equity firms agreed to sell it for $851 million in cash and $399 million in shares of ABM common stock in the proposed transaction announced Wednesday, July 12.

 

The private equity groups will own about 14% of ABM's outstanding stock if the acquisition closes.

 

MORE:

http://www.crainscleveland.com/article/20170712/NEWS/170719927/cleveland-based-cleaning-firm-sold-for-1-25-billion

 

Given the institutions involved in the sale, I doubt jobs will be spared.

Good news, bad news.... Good news: the downtown office market still has more than half of the region's office inventory, and the office market is tightening with all of the office-to-residential conversions of obsolete office buildings and suburb-to-downtown relocations. Bad news: downtown has the highest vacancy rates, only the fifth-best absorption rate, and the second-highest rents...

_____________

 

http://www.jll.com/Cleveland/en-us/research

 

Q2 2017

Cleveland

Office Insight

For more information, contact: Andrew Batson | [email protected]

 

Residential conversions take a bite out of downtown

vacancy; new construction underway in the suburbs

 

• Businesses and residents continue to migrate downtown, spawning a

dramatic improvement in the office market over the last few years.

• Three speculative office developments are under construction in the East

submarket. Look for preleasing at these projects to accelerate in 2018.

• Tenant interest in the Midtown submarket is growing, prompting

Hemingway to move forward with its Link 59 office development.

 

It is an exciting time in downtown Cleveland, with new businesses and

residents moving in each month. The city has experienced a residential boom

over the last five years, much of which has been supported by office-toresidential

conversions. These redevelopment projects have removed large

swaths of functionally obsolete office space from the market, dramatically

reducing vacancy rates. National investors have been attracted by the

improving market conditions, and the ownership landscape looks much

different today than it did just a few years ago. These new owners have made

substantial upgrades to their assets, and have subsequently begun to push

rents higher. While there has been some talk of new office construction in

downtown Cleveland, these projects are a ways off. So as vacancy continues

to tighten over the coming year, we project asking rents climb higher.

Office demand is also strong in the suburbs, prompting the first speculative

office developments in years. Developers are particularly bullish on the East

submarket where three projects are under construction: Pinecrest (150,000

square feet) in Orange, Van Aken (66,000 square feet) in Shaker Heights, and

Highlands Center (47,000 square feet) in Beachwood. Each property has

secured preleasing commitments, signaling a companies’ willingness to pay a

rent premium for well-located, modern office space.

Outlook

Cleveland’s strengthening economy will increase office demand in 2017.

Downtown Cleveland will remain a key beneficiary of this growth, with

declining office vacancy and increased investor interest. The pace of

preleasing will pick up at the speculative office developments in the East

submarket. Finally, we will be watching the burgeoning Midtown submarket

closely this year. This neighborhood is seeing increased interest from tenants

and developers and we think 2017 will be a breakout year

Greater Cleveland Partnership goes from tenant to landlord in downtown Cleveland

By Michelle Jarboe, The Plain Dealer

on July 17, 2017 at 2:22 PM, updated July 17, 2017 at 3:18 PM

 

CLEVELAND, Ohio -- The Greater Cleveland Partnership is shifting roles in downtown Cleveland's theater district, going from tenant to landlord with the purchase of a five-story building.

 

The regional chamber of commerce bought its offices, at 1240 Huron Road, in a deal that closed Friday. The purchase price was roughly $5.7 million, according to the Cuyahoga County Fiscal Office.

 

GCP has been the building's anchor tenant since 2011, when the chamber gave up its former home at the Higbee Building on Public Square to make way for a casino.

 

MORE:

http://realestate.cleveland.com/realestate-news/2017/07/greater_cleveland_partnership.html

Today was Sherwin Williams' quarterly PR and conference call, its first report that includes financial results stemming from the Valspar acquisition. It passed without mention of a new downtown HQ. The closest the company came to saying anything about that was this quote from John G. Morikis, Chairman, President and Chief Executive Officer:

 

"Looking ahead, our focus is on strengthening the performance of our core businesses while completing the integration of the two companies with speed and precision. The former will require us to drive stronger architectural paint sell-through across all retail channels and capture raw material cost increases through appropriate pricing initiatives, particularly in our industrial coatings businesses. The latter means implementing the integration plans we have developed over the past 15 months, and recognizing when course correction is required. Our success in these two areas will create a highly differentiated enterprise better equipped to serve paint and coatings customers around the corner and around the globe."

 

SOURCE: http://www.prnewswire.com/news-releases/the-sherwin-williams-company-reports-2017-second-quarter-financial-results-300491313.html

 

EDIT: everything I'm reading from analysts is that S-W has the strongest growth potential in the coatings industry. I would think that, for a company that had already outgrown its existing HQ before acquiring Valspar, and has such strong growth potential, that a new HQ building would be among its priorities.

^My feelings on SW/MM is that these decisions are just not made during the summer. Those who would make that call are to busy with vacations/family/travel etc. Oct-Nov before the holidays is probably when will will see some movement. With MM being the first to announce.

 

In the meantime a building permit for 601 Canal to add what looks like parking spaces at the SW facility from Kaczmar Architects and SW has been posted. This could mean that some RD ppl from Valspar are making their way over to Cle. Which could also mean the RD facility will remain down by the river.

 

https://ca.permitcleveland.org/Public/Cap/CapDetail.aspx?Module=BuildingHousing&TabName=BuildingHousing&capID1=17BHO&capID2=00000&capID3=11292&agencyCode=COC&IsToShowInspection=

Normally I'd say you're right. But MM is facing the end of several leases in mid- to late-2020, including at its downtown HQ. It's possible that by having its HQ placed in receivership following the building owner's loan default may allow the lease to be extended by the receiver. Then, MM can defer its decision, perhaps to this fall, while it seeks the best deal out there for a new HQ.

 

SW strikes me as a company that will have fully vetted all options for its new HQ, have a knockout final design and financing set before it makes any public announcement. And that may mean a few more months of waiting.

SW Breen Tech Center is full......The new parking spaces are for existing employees.....They are flat out of room there.  Most of the Valspar technical will be staying in Minneapolis at their brand new labs.  I believe SW Warrensville Tech center has some space...but it needs to be remodeled. I get the feeling that any SW announcement on anything is still a long way away

SW strikes me as a company that will have fully vetted all options for its new HQ, have a knockout final design and financing set before it makes any public announcement. And that may mean a few more months of waiting.

 

WSJ quotes the CEO as saying that merger integration costs are six times higher than expected. They may want to defer any capital investments for a year or even two.

Although they did get $420 million cash from the sale of Valspar's North American industrial wood coatings business to Axalta Coatings Systems.

 

And there's nothing to say that Sherwin Williams would own their building and therefore own the debt of building it. Indeed many large companies today prefer to lease their headquarters.

K&D Group targets Post Office Plaza purchase

 

Doug Price, K&D CEO, confirmed the company he runs with co-founder Karen Paganini has a contract to purchase the office building that Forest City installed in the former downtown post office in the 1990s as part of its Tower City Center project.

 

The building at 1300 W. Third St. converted the empty 1925-vintage U.S. Post Office building to office use, preserving its stainless steel-lined art deco lobby for future generations. It was sometimes overlooked because of the scope of Tower City, which incorporated the landmark Terminal Tower and installed a since-failing downtown mall in part of the former rail station and two skyscrapers on pads in the complex that had sat empty since the Great Depression.

 

http://www.crainscleveland.com/article/20170730/NEWS/170739992/kd-group-targets-post-office-plaza-purchase?X-IgnoreUserAgent=1

While I don't really care for K&D residential properties, it is heartening to see goal for this building is to bring new large companies downtown.

While I don't really care for K&D residential properties, it is heartening to see goal for this building is to bring new large companies downtown.

 

K&D needs to start adding equity downtown to match their rental portfolio. Without it, they risk major fluctuations with a rental bubble

I hope someone else in town will pick up this business...

 

August 02, 2017 UPDATED 2 HOURS AGO

New York Community Bancorp to lay off 224 in Northeast Ohio with closure of Cleveland mortgage offices

By JEREMY NOBILE

 

New York Community Bancorp will lay off 224 employees as it shuts down its residential mortgage business in Cleveland, which operates under the Ohio Savings Bank division, according to Worker Adjustment and Retraining Notification (WARN) Act notices filed with the state. NYCB will close its offices at 1801 E. 9th St. in Cleveland — across the street from One Cleveland Center — and 7570 Northcliff Ave. in Brooklyn on or around Sept. 29. The downtown Cleveland office will lay off 210. Those locations are tied to a deal between NYCB and Freedom Mortgage Corp., which has agreed to acquire some of the bank's mortgage assets in Northeast Ohio.

 

MORE:

http://www.crainscleveland.com/article/20170802/NEWS/170809951/new-york-community-bancorp-to-lay-off-224-in-northeast-ohio-with

So if they're closing the office there, that means they won't have any corporate presence in Ohio now? Cleveland is the only Ohio market NYCB is in, and that building (was) the Ohio Savings Bank HQ. I can't imagine they're going to just have free floating branches, but at the same time, the quote that they will now only have 400 Ohio employees doesn't leave much room for any regional HQ staff.

I believe (although I don't know for certain) that they're keeping their commercial lending staff in market. However, they have a model where while sales people are here, most of the underwriting / loan approval occurs in their NY offices. So I bet they operate remotely, with with an LPO that has sales and maybe some sales managers in market.

A long, sad fall from being the third largest bank in Cleveland. 400 employees to remain in the state divided across 28 branches in Cleveland/Akron doesn't leave many for a regional HQ. What happened with National City and PNC was awful, but nothing compared to how NYCB came in and destroyed Amtrust/Ohio Savings.

A long, sad fall from being the third largest bank in Cleveland. 400 employees to remain in the state divided across 28 branches in Cleveland/Akron doesn't leave many for a regional HQ. What happened with National City and PNC was awful, but nothing compared to how NYCB came in and destroyed Amtrust/Ohio Savings.

 

Didn't the FDIC basically wipe out/shut down Amtrust/Ohio-Savings prior to NYCB doing their thing? 

I've heard multiple times that Wells Fargo wants to establish a larger retail presence in Ohio with a small nerve center in Cleveland. Perhaps this could be their "strike while the iron is hot" moment. 

I'd rather see many other banks or a new CLE-based bank than evil Wells Fargo setting up shop here.

A long, sad fall from being the third largest bank in Cleveland. 400 employees to remain in the state divided across 28 branches in Cleveland/Akron doesn't leave many for a regional HQ. What happened with National City and PNC was awful, but nothing compared to how NYCB came in and destroyed Amtrust/Ohio Savings.

 

Didn't the FDIC basically wipe out/shut down Amtrust/Ohio-Savings prior to NYCB doing their thing?

 

Yes, they were wound down and NYCB took over their assets and operations. Ever since they've made money off of Cleveland area deposits without doing any lending or investment, and instead have been winding down and selling off the scraps. Those scraps have been rotting for awhile now too. We're about to tear down a house they own that's completely fallen apart. Their only defense in appealing the demo was that they planned to sell it for pennies to any investor - hardly a good answer for the community.

 

I'm glad someone in the media (ie: Stan Bullard) is poking around on this and letting us know that they are......

_____

 

Finally, John Morikis, CEO of Cleveland-based Sherwin-Williams Corp. fended off queries on the paint maker and seller's July 20 conference call about how large its corporate staff will be as it integrates Valspar's operations with its own.

 

Scott Rednor of Zelman & Associates of Cleveland charmingly phrased the first question about it as "headcount synergies," according to a transcript on the Seeking Alpha investor site.

 

That means there is no indication yet of what may be a key factor in determining if Sherwin-Williams looks for a new HQ in Cleveland and we'll have to stay tuned.

 

Sherwin-Williams has steadfastly declined to discuss such a possibility despite many rumors in real estate circles about the company privately entertaining the idea.

 

SOURCE:

http://www.crainscleveland.com/article/20170808/BLOGS14/170809808/how-edge32-justifies-its-name-with-photo-gallery

^ I don't think Sherwin Williams is very committed to staying downtown.  I just learned today that they are moving all ee's who are currently in the Skylight tower to a location they own on Hinckley Industrial Pkwy.  We're talking about well over 200ee's.  This is what happens when the majority of the staff values free parking over anything else.

I have heard the exact opposite: Sherwin is incredibly committed to Downtown and the ultimate goal for the company is a building many people on this board would be happy about.

 

I think that Sherwin Williams is actually and simply just trying to figure out all its numbers---total employees, square feet needed, etc etc

^ I don't think Sherwin Williams is very committed to staying downtown.  I just learned today that they are moving all ee's who are currently in the Skylight tower to a location they own on Hinckley Industrial Pkwy.  We're talking about well over 200ee's.  This is what happens when the majority of the staff values free parking over anything else.

 

Think about what you just said -- they moved 200+ employees from a building they don't own and must pay rent to a building they do own and have to pay for upkeep, taxes, etc. anyway.

I also think Sherwin Williams has made it clear they want to be a downtown anchor moreso than caring about their employees parking

^ I don't think Sherwin Williams is very committed to staying downtown.  I just learned today that they are moving all ee's who are currently in the Skylight tower to a location they own on Hinckley Industrial Pkwy.  We're talking about well over 200ee's.  This is what happens when the majority of the staff values free parking over anything else.

Who is going into those spots that were vacated by the EEs?  It may be valspar staff working on integration plans. 

(complete speculation, but just because a group is moving locations, doesnt mean that space is being abandoned)

 

^ I don't think Sherwin Williams is very committed to staying downtown.  I just learned today that they are moving all ee's who are currently in the Skylight tower to a location they own on Hinckley Industrial Pkwy.  We're talking about well over 200ee's.  This is what happens when the majority of the staff values free parking over anything else.

Who is going into those spots that were vacated by the EEs?  It may be valspar staff working on integration plans. 

(complete speculation, but just because a group is moving locations, doesnt mean that space is being abandoned)

 

 

Sherwin's lease at Skylight expires at the end of this month.  No one connected to SW or Valspar will be occupying that space.

S-W has a pending building permit for $88,000 worth of electrical work at 4780 Hinckley Industrial Pkwy:

 

https://www.buildzoom.com/property-info/4780-hinckley-industrial-pkwy-cleveland-oh-44109

 

And it doesn't appear that S-W owns the site unless they just bought it and the title hasn't been recorded yet. Here is a lease listing for the same address dating from 2011:

 

http://www.loopnet.com/Listing/17443670/4780-Hinckley-Industrial-Parkway-Cleveland-OH/

^^ I have a buddy who is getting transferred to that location in the fall

^^ I have a buddy who is getting transferred to that location in the fall

 

Tell them not to get too comfy (if you're referring to Skylight).  The plan is to move more departments over to Hinckley as renovations continue and space opens up.  Right now they are in the process of building a gym at the new location. 

Sounds like a very dynamic situation.

^^ I have a buddy who is getting transferred to that location in the fall

 

Tell them not to get too comfy (if you're referring to Skylight).  The plan is to move more departments over to Hinckley as renovations continue and space opens up.  Right now they are in the process of building a gym at the new location.

 

I wish they'd build a gym on the 65th floor of their new tower.  :|

I should also mentioned there's a 50/50 chance your friend could get transferred from Skylight to Midland.  A couple of departments currently stationed in Midland will get transferred to Hinckley. This will create some space to back-fill ee's over to Midland from Skylight. 

Pardon me for asking, as I have never worked in corporate America.  What is an "EE"?

Pardon me for asking, as I have never worked in corporate America.  What is an "EE"?

 

employee

^^ I have a buddy who is getting transferred to that location in the fall

 

I do too, and he is PISSED.  He takes the Blue line in, and the free parking doesn't do jack for him, since now he will be driving 40 minutes each way when he was driving 5 minutes to the rapid station.  Their release to the employees even mention very explicitly "There is no public transportation available to this location."

 

About 225 employees are being moved, and though they are trying to tout the benefits, most people don't like it, at least in my friend's group.

^^ I have a buddy who is getting transferred to that location in the fall

 

I do too, and he is PISSED.  He takes the Blue line in, and the free parking doesn't do jack for him, since now he will be driving 40 minutes each way when he was driving 5 minutes to the rapid station.  Their release to the employees even mention very explicitly "There is no public transportation available to this location."

 

About 225 employees are being moved, and though they are trying to tout the benefits, most people don't like it, at least in my friend's group.

 

Yeah, my friend is a little confused why a finance employee is going to Hinckley Pkwy

I tweeted that news out there on All Aboard Ohio's account and cc'd Sam Bullard at Crain's plus mjarboe[/member] at the PD.

Pardon me for asking, as I have never worked in corporate America.  What is an "EE"?

 

employee

Oh, I thought that was Electrical Engineers....

Pardon me for asking, as I have never worked in corporate America.  What is an "EE"?

 

employee

Oh, I thought that was Electrical Engineers....

 

I actually thought it might be "Existing Employee", as in none of these hordes of Valspar peeps being transferred in from MSP.

They are not really transferring a lot of people in from MSP, either.  The phrase I've heard is "relocation costs money" 

So are they just buying them out and then hiring new out of Cleveland?

So are they just buying them out and then hiring new out of Cleveland?

 

I'm pretty sure the Valspar name will continue, as will a significant amount of the Minneapolis operation.  My brother-in-law will know; I'll ask him.

The whole point of these acquisitions is to reduce headcount ("synergies!"). So if Valspar is to continue operating as a separate line, some people in MN will be terminated and their functions rolled up into existing Cleveland-based corporate/operational infrastructure. Maybe also some transfers and hires, but I wouldn't expect it to be very many.

A few weeks ago I had heard that the Valspar acquisition will add 150-250 new jobs to Cleveland and reduce MN operations by 30-40% when all is said and done.

I'm pretty sure the Valspar name will continue, as will a significant amount of the Minneapolis operation.  My brother-in-law will know; I'll ask him.

 

S-W said Valspar would continue as a product line.