Cuyahoga leverages assets to boost county and Cleveland
Project: Cuyahoga County Real Estate Consolidation Project
Jurisdiction: Cuyahoga County, Ohio
Agency: Cuyahoga County
Vendors: Allegro Realty Advisors, Ltd., CBRE, Geis Companies
Estimated cost for study: $250,000
Actual cost of study: $195,100
Over many years, Cuyahoga County attained more property than it could ever need — 44 owned properties and 22 leased properties, totaling over 7 million sqare feet. In 2011, new County Executive Edward FitzGerald decided to address the real estate portfolio. The Real Estate Consolidation Project was born.
In August of 2011, Allegro Realty Advisors, Ltd. was hired to conduct a thorough study of the real estate portfolio. After carefully considering everything from organizational support needs to operational objectives, the study provided suggestions for future property management and surmised the effects of such management on the overall Cleveland real estate market. It then provided guidelines for the execution of the suggested management plan.
The framework of the study evaluated each property in the areas of programming, financial impact, and portfolio leverage/special use. Based on the framework, Allegro classified each of the 66 properties as an “Invest,” “Divest,” or “Hold” opportunity. In all, 22 of the 66 properties were labeled “Invest” because of programmatic, financial and strategic synergies. Additional recommendations included the divestiture of 22 assets.
Taken collectively, the action plan yields significant savings for Cuyahoga. Over ten years, the county could save over $56 million by realigning the real estate portfolio.
Upon the completion of the study, Cuyahoga retained a real estate program manager, CBRE, to execute the action plan and strategy, which included the acquisition of approximately 225,000 square feet of office space for a consolidated administration headquarters in Cleveland, the acquisition of approximately 200,000 square feet of storage space for a storage facility, and the dispensation/sale of 13 properties currently owned by Cuyahoga County.
Proposals were received in September 2012 and selections were made in late 2012. The selected proposal was submitted by Geis Companies, which proposed a newly constructed facility to be used as the county headquarters. The planned 8-story facility is scheduled for occupancy in July 2014 and will house nearly 800 county employees. Geis also plans to redevelop an existing complex to include a mixture of high-end apartments, office and retail. Redevelopment of this complex meets the needs of the county government and helps address the growing residential demand.
Cuyahoga County is proud to be a catalyst in the accelerating transformation of downtown Cleveland. The Cuyahoga County Real Estate Consolidation Project is a unique opportunity for a county government to direct the future of Cleveland and boost the real estate market in a way that has never been done before.