Seeds & Sprouts V – Early intel on real estate projects

This is the Fifth edition of Seeds & Sprouts – Early intelligence on Cleveland-area real estate projects. Because these projects are very early in their process of development or just a long-range plan, a lot can and probably will change their final shape, use and outcome.

The building at right, above, and at left, below, are facing con-
demnation orders from the city of Cleveland. Between the pair
of Vesta Corp.-owned buildings is another Vesta-owned apart-
ment block — albeit thoroughly renovated. That could be the
the future for its two vacant neighbors in Hough (Google).
CLICK IMAGES TO ENLARGE THEM

Two Hough apartment blocks may be saved

Facing a condemnation order from the City of Cleveland, affordable housing developer and property manager Vesta Corp. of Connecticut is appealing and requesting 180 days to abate building code violations at two 96-year-old, vacant apartment buildings it owns — 1552 and 1568 Ansel Road. The city’s Board of Building Standards is scheduled to consider Vesta’s request at its April 15 meeting.

Although the code violations could be abated through demolition, the two substantial buildings may instead be saved per the appeals and their immediate code violations addressed with repairs. That may be what happens as Vesta has been acquiring and improving apartment buildings on Ansel in recent years.

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Vesta owns four apartment buildings along the west side of Ansel, between Kenmore and Wade Park avenues, in the Hough neighborhood, just across Rockefeller Park from University Circle. The two troubled apartment buildings are on either side of the 66-unit, 1928-built Regency Square Apartments, 1560 Ansel, that Vesta acquired in 2012 and thoroughly renovated in 2013.

The seven-unit Overlook Apartments at 1552 Ansel was acquired by Vesta in July 2016 by sheriff’s deed for $20,000. The 37-unit Lynette Apartments at 1568 Ansel was acquired by Vesta in January 2016 by warranty deed for $75,000. Attempts to reach Vesta representatives by e-mail were not successful.

Several blocks south of here at Hough Avenue, construction is almost finished on Signet Real Estate Group’s 163-unit, $35 million Axis at Ansel apartment building. Just west of it, at 9410 Hough, an unknown buyer is doing its due diligence of the vacant, 1973-built Kingsbury Apartments with an eye toward renovating the 10-story, 160-unit building. These are some of the many spillover effects from the growth of nearby University Circle and Cleveland Clinic.

This 93-year-old apartment building at the southeast corner of
Edgewater Drive and Cove Avenue in Lakewood was acquired
last week and may be renovated by Adam Hayoun (Insight).

Lakewood landmark gets new owner, rehab pledge

Adam Hayoun, who is best known for renovating historic structures in Ohio City, has bought 12065 Edgewater Dr. in Lakewood for $1.8 million on March 2, according to county records. Hayoun, dba MSH Edgewater Investment LLC, acquired the 25-unit, 1927-built apartment building from 12065 Edgewater LLC.

Hayoun also secured a $1,523,761.88 mortgage on the property from Lima One Capital, county records show. It’s a fascinating building architecturally, with a copper-roofed turret above a high-ceiling corner suite at Edgewater and Cove Avenue.

Hayoun already has the building up on his Insight Holdings Web site, with the note: “Soon going for construction.” Given Hayoun’s history, he’s likely to fix up the place. However, no plans have been filed with the city as of yet, said Bryce Sylvester, director of planning and development for the City of Lakewood.

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“Our first acquisition of 2020 (is) an amazing 25 units (sic) building in one of the most desired streets in (Greater) Cleveland,” says Hayoun’s Insight Holdings Web page about the project. Hayoun could not be reached for comment.

Two structures — the old gas station and the older house — that
are visible in this view at the northeast corner of Carnegie Ave-
nue and East 79th Street are proposed for demolition. In their
place could be a retail development. Although small, a deve-
lopment here would join two other property investments
made in the past year at this intersection (Google).

Carnegie-East 79th seeing spurt of investments

Yet another potential restaurant/retail business could be coming to the intersection of Carnegie Avenue and East 79th Street in Cleveland’s Fairfax neighborhood. But before any construction starts, two pending demolitions must first be approved by the city and possible environmental remediation performed.

A 110-year-old duplex and a 51-year-old former Sohio gas station are proposed for demolition by Property Acquisitions LLC, an affiliate of LRC Realty of Akron. LRC is primarily a developer of small- and medium-sized retail properties. But it has also dabbled recently in several mixed use projects in Akron, Youngstown and Pennsylvania.

Three properties and possibly a fourth are involved. Located in between the former gas station owned by Joe Z, LLC and the duplex owned by investor Naomi Colston is a Cleveland Land Bank property. North of Colston’s duplex is another land bank parcel. Both land bank properties had houses on them until they were leveled in 2016. The total area of land for LRC’s development is 0.69 to 0.848 acres.

By comparison, the property across East 79th, Angie’s Soul Cafe, measures 0.67 acres. Angie’s opened in January after closing its St. Clair Avenue location. There are two other Angie’s restaurants on the East Side. The Carnegie restaurant was renovated from its prior function of 24 years — a Hot Sauce Williams restaurant that closed two years ago.

On the other side of Carnegie, a 19th-century Italianate house that was heavily modified in 1920 into a commercial structure was demolished last summer. O.M. Carnegie Realty, LLC acquired eight parcels in 2018 from Regal Arms Housing Inc. and combined them into a single, 1.2-acre parcel. On it, a Dunkin Donuts shop was built in its place. A billboard property at the southeast corner was left untouched.

The gas station’s current owner Joe Z, LLC is owned, in turn, by Mahmoud Zayed, according to county tax records. Zayed and his son Ashraf Zayed, both of Westlake, were sentenced to 30 and 37 months in prison, respectively, in 2016 for food stamp fraud involving the Al-Manar Market on West 117th Street in Cleveland.

Joe Z paid off a $60,000 mortgage issued by the property’s owner, E&C Properties Ltd. in October 2019. Then, on March 5, a construction permit was submitted by Joe Z to the city although with no other information included.

Typically, a prospective developer will submit construction and/or demolition permit applications through the current property owner once a purchase agreement has been secured but before closing. LRC Realty President Frank Licata did not return an e-mail and a voicemail message prior to publication.

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