Sherwin-Williams HQ+R&D is down to two sites; decision due soon

This unofficial massing represents how Sherwin-Williams’ new headquarters and new/renovated research facilities (all shown in dark orange) might appear if built on Bedrock Cleveland’s and SHW’s properties between the Cuyahoga River and Tower City Center in downtown Cleveland. It also shows, to the right of the increasingly likely SHW site, apartment, hotel and office buildings that represent later phases of Bedrock’s CityBlock development (Geowizical). CLICK IMAGES TO ENLARGE

A source close to ongoing property negotiations said Sherwin-Williams could decide in “the next week or so” between two downtown Cleveland sites for its new global headquarters plus research and development facility.

Officially, SHW has held steady to its official statement that it will announce its HQ+R&D site decision by the “end of this year or early 2020.”

However, the source said SHW’s decision is now down to two sites and may be leaning toward one of them:

1. Bedrock/SHW riverfront: The site includes about 2.7 acres of Bedrock Cleveland-owned land, between Huron and Canal roads, and between the Carl B. Stokes U.S. Courthouse tower and the Tower City Center Riverview entrance. Next to it, SHW owns 9.2 acres between Canal and the Cuyahoga River. It is where SHW’s John G. Breen Technology Center is located and where SHW was founded 153 years ago.

2. Jacobs/Weston: West of Public Square, a total of 6.77 acres of parking lots owned by the Jacobs Group and the Weston Group would provide the site for a connected, urbanized office campus. It would be fully integrated into the amenities of a major city’s central business district. Cuyahoga County officials apparently are interested in this site for a new Justice Center complex, as well.

The source believed that the Bedrock/SHW riverfront site had the advantage for several reasons.

“They (Bedrock) can move quicker, they can take a lower return since Dan Gilbert is a multi-billionaire, and it will also tie better into CityBlock, giving that some life,” the source said. “I think there’s enough of a push politically by Bedrock and the CityBlock team that will probably get it done.”

Another view of the unofficial massing, showing a possible juxtaposition of new and renovated SHW buildings in dark orange at the riverfront site. To their right or east are four buildings that could become the later phases of Bedrock’s CityBlock development. To the right of them are new and planned buildings by Stark Enterprises (Geowizical).

Previously, NEOtrans reported that SHW had narrowed its HQ+R&D search down to four downtown Cleveland sites.

In 2014-15, SHW had completed civil engineering and architectural work for a 900,000-square-foot headquarters on the Jacobs lot on Public Square. That effort was shelved as SHW worked to acquire rival Valspar.

This time around, SHW, led by its facilities consultant Welty Buidling Co., is pursuing a 1.8-million-square-foot HQ+R&D complex, highlighted by a 40-story HQ tower. On Oct. 8, SHW through Welty chose Gilbane Building Co. as its construction manager, according to a high-level source.

That same source said that the HQ+R&D facilities would be immediately adjacent to each other, regardless of site, and accommodate up to 6,000 employees. About 3,300 SHW workers are currently employed in downtown Cleveland and another 1,100 elsewhere in Northeast Ohio.

If the Jacobs lot on Public Square was chosen for the HQ, then the R&D facility and all structured parking for the HQ+R&D would probably go on the neighboring Weston-owned lots in the Warehouse District. Yet there has been no chatter among insiders in Cleveland’s close-knit real estate community that the Jacobs/Weston site was favored by SHW in this HQ endeavor.

Instead, a source said that the county and many influential law firms want a new Justice Center courthouse tower built within a few blocks of Public Square. Even with the jail possibly relocated out of downtown, the only undeveloped lands large enough and so close to Public Square are the Jacobs and Weston lots.

Any deal that might be part of a new Justice Center is still years off as the county has yet to decide its course of action. But it could be enticing to Weston and/or Jacobs to accommodate a new courthouse tower if the county buys their land and, in exchange, gives the keys to the old Justice Center complex to rebuild or raze it for new development.

Adding 1.8 million square feet of new HQ+R&D facilities for SHW just west of Public Square could require more significant new?construction yet fill downtown Cleveland’s largest parking crater. But developing that 7 acres of parking lots may have to wait for a decision?by county officials on whether to build a new Justice Center courthouse tower (Geowizical).

Meanwhile, relocating to the Bedrock/SHW site would be less disruptive to SHW. It could use its existing parking, albeit expanded. And it could allow SHW to modernize and expand its existing, 140,000-square-foot R&D facilities at the Breen Center. Without it, SHW would have to build an entirely new R&D facility measuring, by some estimates, up to 350,000 square feet.

How easy could relocating to the Bedrock/SHW riverfront site be for SHW? It could move its office furniture, equipment and materials without using trucks or even having to go outside. Passageways through Tower City Center would allow for such an indoors move.

Recent news has created a buzz around the Bedrock site. It started with CityBlock’s announced $110 million first phase in The Avenue Shops at Tower City which is due to get underway in early 2020. The next phases of CityBlock, between Tower City and the Cuyahoga River along Huron and Canal roads east of SHW’s Breen Center, may soon receive a jolt of capital.

Bedrock Real Estate exited its casino businesses including selling off and leasing back its Cleveland-area casinos, raising $843 million in capital in the process. That capital may stay with Rock Ohio Ventures, allowing it to develop the riverside phases of its CityBlock project.

“The combined efforts of our gaming properties together with the other Cleveland assets operated by our sister companies including the Cavs, Avenue Shops at Tower City and the May Company Building, have created a strong connection to the city and allows us to remain heavily committed to the Cleveland area,” said Mark Dunkeson, CEO of JACK Entertainment.

This massing by Vocon, SHW’s and CityBlock’s architect, shows future phases of CityBlock immediately east of the site that some say has the lead in landing SHW’s HQ. And it is just east of SHW’s existing R&D facilities that could soon be expanded. This massing’s view is cut off right at the edge of a candidate SHW HQ+R&D site (Vocon).

“We will continue to invest significant capital into these properties which will have a lasting positive impact on the city and Cuyahoga County,” he added.

Several large buildings are proposed by Bedrock adjacent to and east of the site that SHW is weighing. They were included in a massing for Bedrock by Cleveland-based Vocon Partners LLC, which is also SHW’s architect. The massing represented potential future work by Bedrock above the river but south of Huron Road, including offices, apartment buildings and hotels, according to another source.

It should also be noted that the law firm guiding SHW’s HQ+R&D project — Korman, Jackson & Krantz LLP — is the same law firm assisting the CityBlock effort. But it is not the same law firm representing Bedrock Cleveland in its negotiations with SHW. Instead, that law firm is?Taft Stettinius & Hollister LLP.

More news this week pointed to increased buzz surrounding the CityBlock site. The London Stock Exchange Group’s Elite Initiative, an international business support program, chose Cleveland for its North American headquarters. A source close to Bedrock’s CityBlock project was hopeful that Elite would soon sign a lease at CityBlock for its HQ.

In the early 1970s, SHW’s 19th-century HQ and factory in the foreground still stood next to its 1948 research facilities that would be expanded in 1998. This view looks west from SHW’s post-1930 HQ in the Landmark Building. Scranton Peninsula is at left and Ohio City is beyond the many bridges (SHW).

Lastly, just across the river, NRP Group is finalizing its designs for 330 residences on Scranton Peninsula. NRP Group usually goes where the action is or is going to be. But what action exists on Scranton Peninsula — currently a desolate, 80-acre blank slate of land?

None, but the calculus changes dramatically if a Fortune 500 company builds a massive new facility just a half-mile walk away. NRP Group reportedly was aware that the Bedrock/SHW riverfront site was seriously being considered by SHW for many months.

A real estate development source with intimate knowledge of downtown Cleveland projects pointed to the developments at and near Bedrock’s CityBlock and its legal and architectural linkages to SHW as intriguing. He argued that it reinforces what the source close to the SHW negotiations believed — the Bedrock site had the edge for SHW’s HQ+R&D.

“At this point, I would be shocked if the Bedrock site wasn’t selected,” he said.

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