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Noble Investment Group Buys Four Residence Inn by Marriott Hotels in Greater Cleveland

10 Mar 2014, 8:56 pm

By Adrian Maties, Associate Editor

Noble Investment Group last week announced the acquisition of four Residence Inn by Marriott hotels in the greater Cleveland metro area. The Atlanta-based company did not disclose how much it paid for the properties.

According to Noble’s website, the four properties include the 175-room Residence Inn Cleveland Downtown, the 174-room Residence Inn Cleveland Beachwood, the 118-room Residence Inn Cleveland Independence and the 96-room Residence Inn Cleveland Mentor. They all feature large suites with full kitchens and offer complimentary hot breakfast, Wi-Fi, grocery delivery service and other amenities. Noble also announced plans to upgrade and redesign the properties to enhance the guest experience. The Residence Inn by Marriott brand is a top choice for guests seeking affordable, upscale accommodations when traveling for an extended period.

“Given the robust demand growth in the Cleveland MSA, Noble believes there is significant opportunity to maximize asset performance with renovations targeted toward enhancing the guest experience. With a going-in cap rate of approximately 11.5 percent on trailing 12-month income, this portfolio represents an attractive combination of in-place yield, considerable income upside and a basis that is well below replacement cost,” said Noble principal Ben Brunt in a statement for the press.

Marcus & Millichap reports that the hospitality market in the Midwest, a region that encompasses Illinois, Indiana, Michigan, Ohio and Wisconsin, performed well in 2013 and that it is expected to continue on the same path in 2014. Business travel remains a primary driver of the hotel sector’s performance, and Cleveland has no shortage of businesses. The city has emerged as a global leader in healthcare, biomedical engineering and technology, home to many important companies. Also, Ohio’s Utica Shale is fast becoming an important driver of economic activity in the region. As households regain the wealth lost during the recession and as the job market becomes more stable, leisure demand will also improve, leading to increased performance.

Photo credit: Marriott.com


Victory Center Prepares to Receive Tenants in Health-Tech Corridor

3 Mar 2014, 10:14 pm

By Adrian Maties, Associate Editor

What was once a vacant building is about to be launched as a mixed-use complex. Garson Victory LLC,  a partnership led by real estate broker Scott Garson, redeveloped 7012 Euclid Ave. after purchasing it in late 2010 for $2.7 million. The result was Victory Center, a complex featuring offices, labs and research facilities and now ready to welcome tenants.

According to real estate website PropertyShark, the four-story building was constructed in 1917. It occupies 3.3 acres of land in the core of Cleveland’s Health-Tech Corridor and offers 165,965 square feet of space.

Garson Victory worked on the project with a local development team including Domokur Architects, on project and construction services; Partners Environmental Consulting; historic consultant Heritage Consulting; LEED consultant HLMS Sustainability Solutions; and NAI Daus. It also collaborated with the city of Cleveland and the state of Ohio.

The developers used tax credits to finance the renovation of the building’s core and shell. The  project received a $4.2 million Historic Tax Credit Award from the state of Ohio in December 2011. It will generate another projected $3.7 million in Federal Historic Tax Credits. Huntington National Bank will finance tenant improvements and other project-related costs.

The total cost of the project was $26.6 million. It delivered a LEED Silver-certified building, ready to house Cleveland’s growing incubator and accelerator growth-stage companies, biomed and tech businesses. Local stakeholders such as BioEnterprise Inc., Jumpstart Inc., Magnet Inc. and Global Cardiovascular Innovation Center are working to attract business tenants to Victory Center.

“The goal of this space is to give local companies room to grow,” Scott Garson, developer and investment partner, said in a statement for the press. “It’s a prime location for occupants to capitalize on Cleveland’s increased investment in tech and biomed businesses, where they can leverage a wealth of local resources and support.”

Photo credits: www.victorycentercleveland.com

Beachwood’s Four Seasons Enters Final Stretch of Campus Expansion Project

25 Feb 2014, 2:25 pm

By Adrian Maties, Associate Editor

The Four Seasons is a luxury gated apartment community in Beachwood. It is owned by Cleveland’s Goldberg Cos., and is currently undergoing an expansion project that will provide several state-of-the-art amenities to current and future residents. The project is scheduled for completion this spring.

Located at 26900 George Zeiger Drive, the Four Seasons includes three distinct high- and mid-rise buildings, with one-, two- and three-bedroom residences and an array of first-class amenities. The expansion project will bring a fourth apartment building to the campus. It will stand five stories high and will include 143 customized one-, two- and three-bedroom apartments. The new building will be adjacent to Beachwood Place. Its apartments will feature oversize windows, nine- and 10-foot ceilings and private balconies, as well as granite countertops, stainless-steel appliances, luxury closets, spa-inspired baths and more.

The Four Seasons will also offer its residents an important number of community amenities, including a landscaped courtyard with water features and outdoor relaxation spaces, entertainment areas and even a new fitness studio. Another important amenity is the community’s location. It’s close to shops, restaurants and entertainment, as well as major thoroughfares. Legacy Village, the Cleveland Metroparks Acacia Reservation and  local galleries are all nearby, while downtown Cleveland is just a short ride away.

“Four Seasons apartments are known for unparalleled service and sophistication,” said Jordan Goldberg, of Goldberg Cos., the project developer, in a statement for the press. “Residents can expect detailed, carefully designed suites, showcasing our commitment to first-class service and experience.”

Photo credits: www.fourseasons4.com

Cleveland Metro Area Apartment Construction Achieves Five-Year High

18 Feb 2014, 5:00 am

By Adrian Maties, Associate Editor

In recent years, the soft job market and the uncertainty about the local economy have kept many people in the Cleveland area from buying new homes. Instead, they opted to rent. That’s why apartment vacancies in the metro area reached one of the lowest levels of the last decade in 2012.

Marcus & Millichap reports that apartment construction in the Cleveland area has now reached a five-year high, as many developers have sought to take advantage of the low vacancy levels. Last year, 550 units were completed, with builders expected to deliver 750 units this year. Apartment construction projects seem to be springing up like mushrooms after the rain.

According to The Plain Dealer, on Feb. 7, the Cleveland City Planning Commission approved rezoning for a roughly four-acre residential development at the edge of Tremont and Ohio City, as well as the conceptual plans for an apartment project in the city’s Detroit-Shoreway neighborhood. Together, these two projects will deliver 500 units close to the city’s downtown. But they will require additional public hearings and community meetings before construction can start.

Another project, in Cleveland’s Ohio City neighborhood, took an even larger step toward construction. Crain’s Cleveland reported that the U.S. Department of Housing and Urban Development notified the developers of the $20 million W. 25th Street Lofts on Feb. 7 that it had approved a $14 million loan for the project. Construction is expected to start in April, as soon as financing is secured.

Plans call for the redevelopment of the former Baehr Brewery at 1526 W. 25th St. into more than 60 apartments. The project offers an opportunity for dense development in a largely single-family neighborhood and will help meet the need for additional housing units in the area.

According to Marcus & Millichap, the weak job market and the rising inventory will lead to an increase in apartment vacancy this year to 5.8 percent. However, vacancy will remain moderate in comparison to the five-year period prior to the recession. Rents will also advance 1.3 percent to $808 per month in 2014. With many of these projects located close to employment districts, attracting tenants shouldn’t be a problem, as companies look to hire more people to fill positions.

Charts courtesy of Marcus & Millichap Real Estate Investment Services

W.P. Carey Buys, Leases Back Air Enterprises Warehouse Facility

11 Feb 2014, 11:22 am

By Adrian Maties, Associate Editor

A Northeast Ohio industrial property recently changed hands. The Air Enterprises Manufacturing/Warehouse Facility in Streetsboro, Ohio, has been acquired by W. P. Carey Inc., a publicly traded REIT, for $7 million.

Air Enterprises will continue to occupy the 178,180-square-foot property, which it has leased for a period of 15 years. The Akron-based company started moving into the new facility last fall as part of its expansion plans. The Record-Courier reported that Air Enterprises will create more than 250 new jobs at the Streetsboro facility, located at 1777 Miller Parkway, less than 25 miles from Cleveland’s central business district, in the next five years.

The property was constructed in 1993, on 23 acres of land. It offers office and warehouse space, as well as more than 250 parking spaces. It was previously occupied by Commercial Turf Products. According to PropertyShark.com, Commercial Turf Products acquired the facility in 1997 for $4.9 million.

W. P. Carey acquired the facility on behalf of CPA®:18 – Global, one of its managed non-traded REIT affiliates. It announced the acquisition together with that of a 1.6 million-square-foot Chicago distribution facility leased to a Solo Cup affiliate. For the second property,  W. P. Carey paid approximately $85 million.

“The two transactions closed on behalf of CPA®:18 – Global demonstrate how W. P. Carey can tailor transactions that enable private companies and institutional real estate investors to sell assets on a timely basis consistent with their specific investment strategies and liquidity requirements. Sourcing, structuring and executing on a variety of single-tenant property types in diverse industries and locations supports our established investment strategy of generating stable, long-term cash flow for investors,” said Gino Sabatini, W. P. Carey managing director & co-head of global investments, in a statement for the press.

CBRE recently reported that Northeast Ohio’s industrial market continued to improve in 2013, with availability decreasing to 7.16 percent at the end of the year. Sale and leasing activity in the region increased, hitting a high of 2.8 million square feet in the third quarter of 2013, levels not seen since pre-recession. And CBRE expects sale prices to continue to bounce back to pre-recession levels this year, as well.

Photo credits: Google Maps.

Buffalo Lodging Associates to Manage Hilton Garden Inn Akron

4 Feb 2014, 6:39 am

By Adrian Maties, Associate Editor

The Hilton Garden Inn Akron is scheduled to open this fall. The hotel is currently under development on three acres of land, on the former Goodyear world headquarters campus, at the corner of East Market Street and Kelly Avenue. It will be the first hotel constructed in Akron since 1980 and it will be managed by Buffalo Lodging Associates LLC.

The hotel is being developed by Pittsburgh-based Summit Development and Industrial Realty Group LLC (IRG), a national real estate development and investment firm. Work on the project started last year. At a cost of $18 million, it will deliver a 139-room hotel with a full restaurant and bar, an indoor swimming pool, a fitness center, meeting rooms offering about 3,000 square feet of flexible space and more.

The Hilton Garden Inn Akron is considered the second phase of the larger East End mixed-use project, also developed by IRG and Summit. The project calls for the renovation of the former Goodyear Tire & Rubber Co. corporate headquarters and Goodyear Hall across the street. The two developers will transform the 1.7 million square feet of space into a mix of offices, retail and residences. Located right in the heart of this massive development, the Hilton Garden Inn Akron is expected to become an important amenity for the downtown Akron business district.

“We are very pleased to have been selected by IRG and Summit and look forward to delivering an outstanding lodging experience to the Goodyear Tire & Rubber Co. and the greater Akron community,” said Cole Fach, vice president of development for Buffalo Lodging Associates, in a statement for the press.

Based in Canton, Mass., Buffalo Lodging Associates offers a wide range of development and management services for new and existing hotel owners. Its portfolio includes 42 hotels throughout New York, Ohio, Missouri, Massachusetts, Connecticut, Rhode Island, Florida, New Jersey and Ontario, Canada.

Photo credits:  www.eastendakron.com

Two More Hotels Planned for Cleveland Area

28 Jan 2014, 5:14 am

By Adrian Maties, Associate Editor

2013 was a good year for hotel construction in the Greater Cleveland area, as developers started work on a number of projects expected to deliver hundreds of new rooms to the region in the near future. And it seems that this hotel construction boom will continue  into 2014. Work will soon start on two more projects in the metro area, one in downtown Cleveland, the other in Avon.

Jacobs Real Estate Services recently announced it will develop a Residence Inn by Marriott hotel at its Avon Place development in Avon. It will be located on Just Imagine Drive, adjacent to the Cleveland Clinic Richard E. Jacobs Health Center.

The new hotel will be constructed on a 4.27-acre site that Jacobs Real Estate Services has agreed to sell to Emerald Hospitality Associates Inc. and its independent affiliate, Nimbus Investment Fund. It will stand five stories tall and offer 116 rooms, with all the amenities of the Residence Inn hotels. An attached 10,000-square-foot conference center will also be constructed. The hotel is expected to open in spring 2015.

“We are excited that Marriott and Emerald Hospitality have chosen Avon Place. Residence Inn will be a perfect complement to the expanding Cleveland Clinic, restaurants and offices planned for this development,” said Jim Eppele, JRES executive vice president, in a statement for the press.

Crain’s Cleveland also recently reported that workers have installed black chain link fences around the former Cleveland Metropolitan School District administration building at 1380 E. Sixth St. in downtown Cleveland. The property will be transformed into the Drury Plaza Hotel.

However, developers don’t expect any real construction to start until summer, as there are still many hurdles the project needs to pass, such as securing city approvals for Drury’s plans or obtaining Ohio Historic Preservation Tax Credits. Construction crews are currently working on site cleanup and asbestos abatement.

The makeover is expected to cost more than $35 million. It will deliver a 180-room hotel. The project is expected to be completed by late 2015.

Photo credits: Google Maps            

Westin Cleveland Downtown to Open in May

21 Jan 2014, 3:57 am

By Adrian Maties, Associate Editor

The Westin Cleveland Downtown hotel will open in May in Cleveland’s downtown financial district, following a $64 million renovation. It will have a new look and a new general manager. Recently, the ownership hired Mark Anderson to lead the hotel in operations and guest services.

Optima Ventures partnered with Sage Hospitality to buy and renovate downtown Cleveland’s second-largest hotel. They paid $9 million for the property, purchasing it from the defunct financial-services giant Lehman Brothers Holdings Inc. The renovation project started in December 2012, with Willoughby, Ohio-based Marous Brothers Construction as the general contractor. It is designed by McCarten, an award-winning New York design firm.

When finished, the project will deliver a 484-room, contemporary, art-driven hotel, within steps of some of downtown Cleveland’s most important attractions: the Cleveland Convention Center and Global Center for Health Innovation, Browns Stadium and the Rock & Roll Hall of Fame. The new hotel will feature 20,000 square feet of flexible event space that can be divided into 20 separate rooms, including a 9,000-square-foot Grand Ballroom connected to the floor above by a glass staircase. Other amenities include a state-of-the-art fitness center, a business center, a Starbucks, as well as a new restaurant, the Urban Farmer-Cleveland’s Steakhouse. Once finished, the property is expected to achieve LEED certification.

Anderson has experience with the Westin brand as well as Sheraton and Hilton. He previously managed such hotels as the 1,053-room Boston Park Plaza Hotel and Towers, the Hilton Stamford, the Sheraton Boston and the Westin Providence Hotel. He joined the Westin Cleveland Downtown on Dec. 11, 2013.

“Sage is thrilled to have Mark lead us into the exciting Cleveland market,” Vincent Piro, divisional vice president of operations, premier & lifestyle for Sage Hospitality, said in a statement for the press. “This hotel will bring modern luxury, local flavor and authentic service to the Cleveland market. We look forward to its opening.”

Photo credits: www.westincleveland.com/


BakerHostetler to Move to Cleveland’s Key Tower in 2016

13 Jan 2014, 3:42 pm

By Adrian Maties, Associate Editor

Prime office spaces continue to be in high demand in Downtown Cleveland. BakerHostetler is just the most recent name added to the growing list of companies looking to do or to continue doing business in the CBD. Ranked 65th on the AmLaw 100 (American Lawyer, 2013, by gross revenue), the global law firm recently signed a 15-year lease for space in Downtown Cleveland’s iconic Key Tower. Currently, it is located in PNC Center, at East Ninth Street and Euclid Avenue.

Standing 57 stories, or 947 feet tall, Key Tower is the largest building in Cleveland, the largest in the state of Ohio, the 20th largest in the United States and the 107th largest in the world. The skyscraper was completed in 1991 and opened in January 1992. It was designed by the famous architect César Pelli. The building offers 1.3 million square feet of space and is the headquarters of KeyCorp, the holding company for KeyBank. KeyCorp signed a 15-year lease extension for 37 percent of the Class A office tower in 2013.

Columbia Property Trust, one of the nation’s largest office REITs, has owned Key Tower since December 2005.  Starting in January 2016, BakerHostetler will occupy five floors of the 57-story building, about 115,615 square feet of space. Columbia Property Trust was represented by its vice presidents of asset management, Jerry Banks and Darik Afshani, and by Douglas Miller, Cindy Greiner and John Klayman of Jacobs Real Estate Services, an affiliate of The Richard E. Jacobs Group. Sherry Cushman of Cushman & Wakefield Inc. and Doug Leary of CBRE Group Inc. represented BakerHostetler.

“We are pleased to welcome BakerHostetler as a tenant at Key Tower,” Jerry Banks said in a statement for the press. “This deal supports our strategy to build value for our investors by enhancing the tenancy of Key Tower with yet another long-term, highly creditworthy tenant.”

Over the past two years, tens of businesses have moved to the CBD, bringing over 5,000 new jobs with them. CBRE expects this trend to continue for the next few quarters and the demand for prime office space to remain strong. The overall vacancy rate decreased in the third quarter of 2013 from 20.2 percent to 20.1 percent, while office rental rates increased by $0.86, ending the third quarter at $17.87 per square foot. In the CBD, rents increased from $19.10 per square foot to $19.29 per square foot.

Photo credits: Columbia Property Trust
Charts courtesy of CBRE.

Marcus & Millichap Arranges Sale of North Olmsted Towne Center for $17.8M

7 Jan 2014, 4:51 am

By Adrian Maties, Associate Editor

Large retail properties in the Greater Cleveland area saw a lot of action in the final quarter of 2013. Devonshire REIT Inc. paid $8 million for the Great Lakes Plaza in Mentor, while Starwood Capital Group acquired two shopping centers in North Olmsted and Canton as part of a $1.6 billion, seven-property portfolio.

More recently, the North Olmsted Towne Center changed hands. Carnegie Management and Development Corp. sold the shopping center for $17.8 million, or $186 per square foot, to an out-of-state private investor. According to Marcus & Millichap Real Estate Investment Services’ Cleveland-area retail report for the third quarter, the lack of quality assets, particularly in the shopping center segment, kept the median price per square foot for multi-tenant properties 10 percent lower, at $38 per square foot, compared to the level at midyear.

The Towne Center is located in the center of North Olmsted’s commercial district, at 25100 Brookpark Road, about 17 miles southwest of Cleveland. It offers 95,446 square feet of retail space, with tenants such as David’s Bridal, The Tile Shop, Jimmy John’s, La-Z-Boy, Men’s Wearhouse, Moe’s Southwest Grill, Party City and Pearle Vision. The property is also shadow anchored by a Target and a Walmart Supercenter.

Marcus & Millichap arranged the sale. Scott Wiles and Craig Fuller, of its Cleveland office, and Erin Patton, of its Columbus office, represented the seller. Together with Dustin Javitch of the Cleveland office, they also advised the buyer.

“Multi-tenant property transaction velocity in the Cleveland metropolitan area has nearly doubled over the past four quarters as local investors became much more active in the market,” Wiles said in a statement for the press. “Well-located, high-quality centers such as the North Olmsted Towne Center attract attention from local investors and out-of-area buyers from throughout the investor spectrum.”

Photo credits: Carnegie Management and Development Corp.
Charts courtesy of Marcus & Millichap Real Estate Investment Services

Ohio Development Services Agency Awards $20M in Ohio Historic Preservation Tax Credits to Five Northeast Ohio Projects

31 Dec 2013, 8:52 am

By Adrian Maties, Associate Editor

On Dec. 20, the Ohio Development Services Agency awarded $33 million in Ohio Historic Preservation Tax Credits to rehabilitate 31 historic buildings in 10 communities across the state. Five of these projects are located in Northeast Ohio.

The Round 11 Winners of the Historic Preservation Tax Credits in Northeast Ohio are 264 Broadway Ave., the Akron Masonic Temple, the Hoover West Factory Complex, Johnson Court and the May Company Apartments. They were awarded more than $20 million, almost two-thirds of the $33 million. The Northeast Ohio projects are expected to leverage more than $250 million in private investments. In total, the tax credit recipients in the state of Ohio are expected to leverage more than $400 million. The awards will help developers rehabilitate the buildings, many of which sit vacant today, and bring new life to the surrounding neighborhoods.

At a cost of $477,000, 264 Broadway Ave. is the smallest of the Northeast Ohio projects. It was only awarded $93,200 in tax credits. Plans call for the transformation of the former mental health facility in Youngstown’s historic Wick Park neighborhood into five market-rate apartments.

The almost century-old Masonic Temple at 103 S. High St., in Akron, will be turned into a full-service, 16-room hotel at a cost of about $48 million. It was awarded $4,997,737 in tax credits.

The Hoover West Factory Complex is the central landmark of downtown North Canton. It consists of 19 buildings, with half-a-million square feet of space. A $51 million project will turn the former home of the nation’s leading vacuum manufacturer into a mix of retail, office and residential space, creating 132 market-rate residential units. It is the first North Canton project to use the Ohio Historic Preservation Tax Credit Program and will receive a total tax credit of $5 million.

The Johnson Court complex is one of the last properties in Cleveland’s Warehouse District to be rehabilitated. A $30 million project will transform the 200,000-square foot structure into 73 market-rate apartments, with indoor parking and commercial space. Plans also include a rooftop penthouse. It was awarded $5 million in tax credits.

The mammoth May Company Building in Cleveland sits almost completely vacant today, although it once housed one of Cleveland’s leading department stores. This autumn, developers announced their plans to turn the century-old building into a residential tower with 353 apartments and about 600 parking spaces. The total cost of the project is $129 million, the largest of the 33. It was awarded $5 million in tax credits.

“The Ohio Historic Preservation Tax Credit strengthens local communities by restoring a piece of its history,” said David Goodman, director of the Ohio Development Services Agency, in a statement for the press. “These projects help enrich cities across Ohio, preserving the character and charm of buildings that may have otherwise been demolished.”

Arhaus Furniture to Move 230 Employees to New Corporate HQ in Boston Heights

23 Dec 2013, 4:22 am

By Adrian Maties, Associate Editor

Arhaus Furniture, one of the fastest-growing furniture  retailers in the United States, has announced it plans to build a new $43 million corporate headquarters and distribution center in the village of Boston Heights. Construction is slated to start in March 2014. Arhaus Furniture hopes to move into the new building by April 2015.

The company’s current headquarters building is located at 7700 Northfield Road in the village of Walton Hills.  It only offers a combined 270,000 square feet, and is unable to accommodate the growing company’s needs. “Walton Hills has been home to us for nearly 20 years. While here we’ve experienced tremendous growth and expanded our facility several times to accommodate our high growth. We’ve now reached a point where we have literally run out of space and the ability to expand further,” Greg Teed, Arhaus Furniture CFO, said in a statement for the press. He added that a major expansion was necessary in order for the company to continue to be an industry leader.

Arhaus Furniture’s new headquarters building will be constructed on 64 acres of land at the former site of the Boston Hills Country Club, on East Hines Hill Road, near the intersection with State Route 8. The new facility will offer 770,000 square feet of space, with the possibility of expanding to 1 million square feet. “It will be substantially larger to not only accommodate the growth we’ve experienced recently in staff numbers and product assortment but continued success and expansion that we are planning for the next 10 years,” Teed said.

The furniture retailer will bring its staff of 230 to Boston Heights. It also plans to create at least 30 new positions each year. “We’re excited to welcome such a reputable and responsible company to the village of Boston Heights,” Boston Heights Mayor Bill Goncy said. “Their commitment is not only to sustainability in the design and construction of their furnishings but to minimizing their impact on our local environment with energy efficiencies for all buildings. This is a complement to the other companies already here and our residents. We look forward to having them as a corporate partner for many years to come.”

Arhaus Furniture also considered other states but chose to keep its operations in Ohio. The incentives offered by state and local officials convinced the company to stay. Arhaus will receive an 85 percent property tax abatement for 15 years. “We are very appreciative of the work that the village of Boston Heights has done in bringing such a wonderful company to our area,” said Superintendent Phil Herman. “The continuous revenue stream generated by this new corporate neighbor will provide much needed resources for the district’s on-going permanent improvement projects and other programs, benefiting both our students and community.”

Photo credits: Google Maps

CSU Breaks Ground on $45M Center for Innovation in Health Professions

16 Dec 2013, 9:28 pm

By Adrian Maties, Associate Editor

Cleveland State University broke ground on Dec. 9 on a new health sciences building. Called The Center for Innovation in Health Professions, it will be a place for students to learn and work together in interdisciplinary collaboration. The project is expected to cost $45 million.

The state-of-the-art facility will be located at the corner of Euclid Avenue and E. 22nd Street, on the site of the former Viking Hall dormitory, the Wolfe Music building, the Rascal House restaurant and Peabody’s Concert Club. CSU started the demolition of the Peabody’s and Rascal House buildings earlier this month.

The 100,000-square-foot center will serve as the new home of the Partnership for Urban Health, a partnership between CSU and the Northeast Ohio Medical University (NEOMED), dedicated to training physicians and other health professionals. Nursing, occupational and physical therapy, music and art therapy, social science research, criminal forensics, cultural anthropology and contemporary alternative medicine also will be taught at the center. NEOMED will occupy about 20 percent of the new building and will lease the space for 25 years.

The new facility will include:

  • An Innovation Center that supports creative teaching and learning strategies as well as collaborative and innovative research;
  • A Speech and Hearing Clinic, complete with observation and testing labs.
  • Nursing simulation labs;
  • An occupational therapy/physical therapy training room;
  • The CSU Health and Wellness Services Department;
  • NEOMED standardized patient exam rooms; a pharmacy simulation lab and classrooms;
  • Distance-learning rooms and classrooms for students from both universities;
  • “Touchdown” rooms for small-group learning;
  • Quiet study areas;
  • Lounges;
  • A café;
  • A large central atrium for informal gatherings and events;
  • Faculty and administrative offices clustered to maximize collaboration.

 “Our new health sciences building will foster an exciting new model for health-care education,” CSU President Ronald Berkman said in a statement for the press. “For too long, healthcare education has been relegated to silos, with little or no interaction among aspiring physicians, nurses and other health professionals. In a city renowned for world-class healthcare, our collaborative approach to healthcare education will lead to new efficiencies that ensure better health, better care and lower healthcare costs.”

Construction is scheduled to start this month. Internationally renowned architectural firm Pelli Clarke Pelli designed the building. The New Haven, Conn.-based company also designed New York City’s World Financial Center, Malaysia’s Petronas Towers, Hong Kong’s International Finance Centre and Cleveland’s Key Tower. The Center for Innovation in Health Professions is expected to open in June 2015.

Photo credits: Cleveland State University Tumblr

Devonshire REIT Buys Mentor’s Great Lakes Plaza for $8M

10 Dec 2013, 9:49 am

By Adrian Maties, Associate Editor

Another Cleveland-area shopping center has changed hands. A few weeks ago, Starwood Capital Group has completed the acquisition of two Northeast Ohio shopping centers, as part of a seven-property portfolio for which the Greenwich, Conn.-based investment firm has paid $1.6 billion to the Sydney, Australia-based Westfield Group. Now, Devonshire REIT, Inc. Has announced it has closed the purchase of Great Lakes Plaza.

Great Lakes Plaza is located at 7900 Plaza Boulevard, in Mentor, a far eastern suburb of Cleveland, on the south shore of Lake Erie. The shopping center is co-anchored by Michaels Stores, Inc., the largest arts and crafts chain in the United States, and hhgregg, Inc., a publicly traded electronics and home appliance retailer. Its tenant roster also includes other national retailers such as: Shoe Carnival, Tuesday Morning and Cato Fashions.

Great Lakes Plaza offers 81,349 square feet of leasable space. According to a press release by Devonshire REIT, Inc., the shopping center is 100% leased. The Whitehouse, Oh.-based fully integrated real estate investment trust acquired the property from the Simon Property Group for $8.0 million. The Goldman Sachs Mortgage Company provided financing.

“As a value-oriented center, the property is a perfect fit for our portfolio, it is also 100% leased, will be accretive to earnings, and expands our footprint into the Cleveland MSA,” said Chris Campbell, President and CEO of Devonshire REIT, in a statement for the press. Mike Denman, Executive Vice President of Real Estate Operations, also added that “Great Lakes Plaza is in a prime location across the street from Great Lakes Mall, which is a destination shopping center for Northeast Ohio. It’s a great center with a solid tenant mix and we’re excited to include it in our portfolio.”

Devonshire REIT, Inc. owns, operates, and develops dominant shopping centers primarily in the Great Lakes and Midwest regions of the United States.  The company’s portfolio currently consists of 36 properties representing over 2 million square feet of leasable space.

Photo credits: Devonshire REIT, Inc.

Cleveland City Council Approves Financing for FirstEnergy Stadium Modernization Project

2 Dec 2013, 4:38 pm

By Adrian Maties, Associate Editor

It’s been a rough couple of weeks for Cleveland Browns fans, as their team recently lost to two longtime rivals, the Cincinnati Bengals and the Pittsburgh Steelers, in the 2013 NFL regular season. But the Cleveland team did manage to score one important victory. On Nov. 25, the Cleveland City Council approved a financing plan to modernize FirstEnergy Stadium.

Browns owner Jimmy Haslam announced the project earlier in the month, just days before the important game against the Cincinnati Bengals. At a cost of $120 million, the project is expected to improve the fan experience and also help the team win as many games as possible. It will be carried out in two phases, in 2014 and 2015.

During the first phase, the Browns will install two new video boards, triple the size of the current boards, and add new LED video boards and a new audio system. The seating capacity of the 15-year-old stadium will be reduced from 71,000 to 68,000, but the lower bowl will be reconfigured to include more seats closer to the field and provide better views of the game. New escalators will be installed in both the north and south end zones. In 2015, the Browns will upgrade the general concession areas as well as the club seats and suites. Work is scheduled  to start after the final home game of the 2013 regular season.

To fund the project, the Browns will use a $62 million loan from the NFL, the money from the city and a bank loan to cover the remainder. The city, which owns the stadium, will provide $2 million in funding each year for the next 15 years. The $30 million represents a present-day value of $22 million.

According to The Cleveland Plain Dealer, the financing was approved after a four-hour debate, with 13 votes in favor and five against. The ordinance needed at least 12 votes to pass. The council members were divided and several of them spoke out against the project, saying that the money could be put to better use improving the city’s neighborhoods.

Mayor Frank Jackson expressed his gratitude for the council’s vote and for  Jimmy Haslam’s investment in the stadium, saying that “this type of private investment in our city is essential to our continued success.”

“We respect the process we went through with City Council and Mayor Jackson and appreciate their support for this project. We look forward to moving ahead with the renovation of FirstEnergy Stadium. We know it will positively impact our fans’ experience, and our community will be proud to showcase the transformed home of the Browns for the rest of the country,” Jimmy Haslam said in a statement for the press.

Photo credits: http://www.firstenergystadiumproject.com

Starwood Buys Two Northeast Ohio Malls as Part of $1.6B Deal

26 Nov 2013, 2:37 pm

By Adrian Maties, Associate Editor

Investment firm Starwood Capital Group last week completed the acquisition of seven dominant regional malls in four states, on the West Coast and in the Midwest. The deal was announced in September. Two Northeast Ohio shopping centers are also included in the portfolio.

The two Northeast Ohio malls are the Great Northern in North Olmsted and Belden Village in Canton. The Great Northern Mall is the largest of the two. It is a single-level enclosed shopping mall with about 1.2 million square feet of retail space, and is anchored by Macy’s, Dillard’s, Sears, J.C. Penney and Dick’s Sporting Goods. The mall was constructed by the Biskind Development Co. and opened in 1965. Great Northern is currently undergoing an expansion project that will bring  a new movie theater, restaurants, reconfigured retail space and a new main entrance. The project is expected to be completed by the end of the year.

Belden Village offers 826,140 square feet of space. It was constructed by The Richard E. Jacobs Group and opened in 1970. Belden Village is anchored by Dillard’s, Macy’s and Sears.

Starwood now owns three shopping centers in Northeast Ohio. The company acquired Strongville’s SouthPark Mall last year.

The portfolio contains 7.9 million square feet of retail space. It includes another Ohio mall, Franklin Park, in Toledo, with nearly 1.3 million square feet of retail space. The other malls in the portfolio are the Capital in Olympia, Wash., the Southlake in Merrillville, Ind., and the Parkway in El Cajon and Plaza West Covina in West Covina, Calif. All of the malls are anchored by major national retailers, with an average occupancy of almost 96 percent. Starwood acquired the portfolio from the Sydney, Australia-based Westfield Group for $1.6 billion. Westfield will retain a 10 percent common equity interest in the properties. Read more about this story here.

Marcus & Millichap reports that retail property operations throughout the Cleveland metro area have been strengthened by growing apartment development activity. According to a report for the third quarter of 2013, transaction velocity in multi-tenant properties has almost doubled in the past four quarters, with the median price for multi-tenant properties reaching $38 per square foot. The Akron, Stark County and Northeast submarkets generated 40 percent of all sales in the past 12 months. Activity in Akron and Stark County more than doubled during this time.

Photo credits: Google Maps.
Charts courtesy of Marcus & Millichap.

Pinecrest Development in Orange One Step Closer to Construction Start

18 Nov 2013, 10:14 pm

By Adrian Maties, Associate Editor

A small village in Northeast Ohio is about to have a huge impact on the entire area. On Nov. 5, residents of the village of Orange voted to approve plans to rezone a residential neighborhood and pave the way for a 76-acre mixed-use project that will bring new, upscale shopping to the region. According to unofficial results from the Cuyahoga County Board of Elections, 709 people voted for Issue 51, while 532 were against it.

The project is called Pinecrest and it’s the creation of Northeast Ohio real estate developer David Lewanski and Lewanski Development L.L.C. At a cost of $150 million, it will be Orange Village’s first-ever town center.

Pinecrest will be located near the Harvard Road and I-271 interchange. On the project’s website, the developers say they reached agreements with all the required homeowners and that they will receive above-market value for their homes. They also pledged not to bring any big-box, discount retailers to the development.

Pinecrest is designed to be a pedestrian-friendly destination, with a Western lodge-style architecture. The developers say they will use natural materials such as stone, wood and brick in its construction, as well as green building techniques. Plans show Pinecrest will feature about 400,000 square feet of retail and restaurant space; a 650-seat theater; 18,500 square feet of office space; 220 flats, villas and townhomes; parking; and green spaces. All the homes will be for-sale only, with prices starting at around $300,000.

The development is also expected to provide a significant boost to the local economy. According to its website, Pinecrest is expected to bring $1.5 million in new annual revenue for Orange Village and $2.9 million in new annual revenue for Orange Schools. It will also create more than 1,000 construction jobs and over 2,100 permanent jobs upon its completion.

The project will be developed in phases. Phase II also includes the construction of an upscale, 75-room hotel. Work will start next year, with Phase I expected to open in 2016. All phases are scheduled for completion by 2018. The Cleveland Plain Dealer reported last week that David Lewanski signed Fairmount Properties on as a joint-venture partner for the development. 

Photo credits: http://pinecrestyes.com/

Cleveland Named Most Affordable Housing Market in United States

12 Nov 2013, 7:02 am

By Adrian Maties, Associate Editor

Looking to buy a house in Cleveland? You’re in luck! The Northeast Ohio city is the most affordable housing market in the nation, according to an annual report by Coldwell Banker Real Estate.

In its 2013 Home Listing Report, Coldwell Banker analyzed the average listing price for a four-bedroom, two-bathroom property between January 2013 and June 2013 for 52,257 listings in 1,997 markets. Markets without at least 10 four-bedroom, two-bathroom listings were excluded from the ranking. The report identified Cleveland as the least expensive market. On average, a four-bedroom, two-bathroom home here lists for $63,729.

“Cleveland’s friendly, hometown feel draws people of all ages, and in recent years the community has been revitalized, with more young professionals entering the market,” said Ed Dolinsky, president of Coldwell Banker Hunter Realty, in a statement for the press. “Energized by a growing tech hub that effectively supports nearby renowned hospitals and research institutions, this Midwest city continues to reinvent itself through its diversified business sectors and strong sense of neighborhood communities.”

The second-most-affordable housing market in the U.S. is also located in the Cleveland Metropolitan Area. It’s Garfield Heights, where the average listing price for a four-bedroom, two-bathroom home is $66,075. A total of 66 Ohio cities were included in the study. Ten of them were among the top 100 most affordable markets. Ohio ranked as the 14th most affordable state in the nation.

According to Coldwell Banker’s 2013 Home Listing Report, Malibu, Calif., is the most expensive market in the U.S. Madison Hildebrand, an agent with Coldwell Banker Residential Brokerage in Malibu, said the affluent beach community is transforming “from a seasonal destination to a year-round locale.” The average listing price for a  four-bedroom, two-bathroom home in Malibu is $2.2 million.

Key Highlights from the 2013 Coldwell Banker U.S. Home Listing Report:

  • The average listing price of a four-bedroom, two-bathroom home in the survey was $301,414.
  • California holds 13 of the top 25 spots for the most expensive markets in the U.S.
  • All top five of the most expensive markets are in the Golden State, with the two most expensive markets in the country located minutes from Los Angeles—Malibu (No. 1) and Newport Beach (No. 2).
  • In contrast, 60 percent (15) of the 25 most affordable markets are in the Midwest.
  • New York is the only state that had markets ranked on both the most expensive and most affordable lists.

You can view a list of the most expensive and most affordable markets in each state on the Home Listing Report website.

Source: Coldwell Banker Real Estate

Smartland Buys Lee-Yorkshire Apartments in Cleveland Heights

5 Nov 2013, 6:20 am

By Adrian Maties, Associate Editor

Smartland, Cleveland’s largest real estate investment firm and one of Ohio’s top property management companies, has purchased the Lee-Yorkshire Apartments. The price of the transaction was not disclosed.

The Lee-Yorkshire Apartments complex is located at 2027 Lee Road, in Cleveland Heights, one of Cleveland’s most desirable suburbs in terms of public transportation, safety, education, amenities and resident services, according to Smartland. It is close to some important Cleveland landmarks, such as the Cedar Lee movie theater, the Lopez restaurant, Cleveland Clinic, Cleveland State University, Case Western Reserve University and University Hospitals.

The complex offers 304 spacious one-bedroom and two-bedroom units, featuring hardwood floors; ceiling fans; walk-in closets; kitchens with built-in cabinets, refrigerators and stoves; full baths; and more. Building amenities also include covered parking and a laundry facility.

“Lee-Yorkshire Apartments offers the perfect mix of affordable rent and well-managed housing that Cleveland-based tenants—and Ohioans in general—appreciate and have come to expect from Smartland,” Vadim Kleyner, its CEO, said in a statement for the press. He added that his company believes in and wants to contribute to Northeast Ohio’s economic rebirth and that the purchase is part of Smartland’s years-long commitment to bringing high-quality, affordable housing to the area. “Over the last several years, we have restored hundreds of houses in the Cleveland area and have successfully helped reduce vacancy rates throughout Cleveland. We will continue to identify, restore and purchase properties that meet our investment and quality standards,” Kleyner also said.

One-bedroom apartments in the complex rent for $650 per month, while two-bedroom units rent for $725 per month. According to a Marcus & Millichap Greater Cleveland apartment market report for the third quarter of 2013, average effective rents rose to an all-time high of $792 per month. With apartment vacancy in the area at historically low levels, the average effective rent is likely to rise to $804 per month by the end of the year.

Photo credits: Cleveland Property Management
Charts courtesy of Marcus & Millichap Real Estate Investment Services.

Developers Break Ground on New Cambria Suites Hotel in Avon

28 Oct 2013, 3:46 am

By Adrian Maties, Associate Editor

Another hotel is under construction in the Cleveland area. Choice Hotels International Inc., Ceres Enterprises LLC and Consolidated Construction Co. started work on Oct. 21 on a new Cambria Suites hotel at 35600 Detroit Road in Avon. The cost of the project was not announced.

The 113-suite hotel is scheduled for completion in early fall 2014. According to a news release, it “will be designed for guests who want to take their lifestyle with them when they travel.” The 113 suites will be larger than the traditional hotel rooms, and will offer separate work and living areas. Each room will feature two flat-screen LCD TVs, a CD/DVD player and MP3 jacks.

The property will also offer free Wi-Fi and the usual Cambria Suites amenities. Guests will be able to dine at the Reflect restaurant or grab a coffee at the hotel’s barista bar. A Refresh state-of-the-art fitness center will also be included, as well as a 24-7 Refill convenience store.

“We look forward to bringing the distinctive Cambria Suites experience to travelers visiting Avon, Ohio,” Michael Murphy, senior vice president of Cambria Suites, said in a statement for the press. David Crisafi, president of Ceres Enterprises, added that Cambria Suites was ”an obvious choice” for his company, as it looked to expand its hotel portfolio. “The brand offers a unique value proposition in the upscale category, with amenities that allow travelers to be at their best.  My father, Frank Crisafi, and I have lived here and done business here for most of our lives and have owned and operated hotels in the Cleveland area for over 20 years.  The market growth and potential in Avon is extremely positive, and we look forward to bringing the Cambria brand to the area,” he said. Frank and David Crisafi, owners of Ceres Enterprises, already operate a very successful Cambria Suites in Noblesville, Ind.

In recent months, developers have started work on several hotel projects in the Greater Cleveland area, such as the 110- to 125-room Marriott-branded hotel Emerald Hospitality plans to build in Avon. That property is also expected to open in fall 2014.

In downtown Cleveland, the GEIS Cos. and Sandvick Architects plan to invest $250 million into transforming the former AmeriTrust Tower and historic Cleveland Trust Rotunda into ”The 9,” a high-end complex featuring a luxury hotel, apartments and much more. Value Place also announced this summer that it will develop six more hotels in the Cleveland metro area, while a $40 million project will deliver the first new hotel in downtown Akron in 40 years.

Photo credits: Cambria Suites

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