The Downtown Cleveland office building formerly known as Ohio Savings Plaza has not only lost its name from its façade. It’s also losing its former main bank branch, now under the name Flagstar Bank, from the building’s ground floor (Google). CLICK IMAGES TO ENLARGE THEM.
Changes happening at ex-Ohio Savings Plaza
Customers who have accounts at Flagstar Bank’s Downtown Cleveland branch received letters this week saying that the branch will be closing and that all accounts will be moving soon to Flagstar’s Ohio City branch. But the $2.6 billion question is: why?
NEOtrans reached out to persons working at the downtown Flagstar branch. When asked about when and why the branch is closing, employees referred NEOtrans to Flagstar’s toll-free number which was a dead-end. NEOtrans twice e-mailed two Flagstar spokesmen but neither responded prior to publication of this article.
The branch’s closing could be the result of New York Community Bancorp’s (NYCB) corporate restructuring. It is unlikely the result of a pending sale and/or redevelopment of the office building in which it’s located. The reason? A neighboring, sole-remaining ground-floor retail tenant in the same building, a FedEx Office Print & Ship Center, isn’t closing or relocating, said a woman who answered the phone there.
The downtown branch is located on the ground floor of 1801 E. 9th St., a building named Ohio Savings Plaza until its façade signage was removed last year. The retail office was the main branch of Ohio Savings Bank until its parent NYCB of Hicksville, NY, located on Long Island, acquired Flagstar of Troy, MI, a Detroit suburb, for $2.6 billion in 2022. NYCB liked the Flagstar name better and officially rebranded itself as Flagstar Financial last October.
The former Ohio Savings Plaza is an 18-story office building at 1801 E. 9th and includes a little brother, a nine-story Park Plaza building at 1111 Chester Ave. The office buildings are both owned by Walnut Realty Holding Company, an NYCB subsidiary. They are separated by a parking garage owned by someone else. Walnut Realty Holding’s purpose according to NYCB annual reports is to own back-office buildings.
Flagstar Bank’s Downtown Cleveland branch, formerly the main branch of Ohio Savings Bank, occupies the first floor of an 18-story office building on East 9th Street but not for much longer. And the name of the building can no longer be called Ohio Savings Plaza. That name was removed from the façade at the top of the three-story podium before last August when this streetview was captured (Google).
NYCB has little if any back offices at the former Ohio Savings Plaza after it acquired Flagstar. Its remaining offices are in New York, Michigan and Indiana. And since Flagstar lacks an office presence here, NYCB/Flagstar apparently didn’t desire to keep a retail presence there either, according to Cleveland real estate insiders who spoke to NEOtrans on the condition of anonymity.
Furthermore, NYCB was suffering financial stress from its commercial real estate portfolio. So it put the two-building, ex-Ohio Savings Plaza/Park Plaza properties on the market as a single offering. NYCB listed it with the international brokerage Colliers.
Combined, the two buildings total a half-million square feet. The East 9th building, built in 1969, measures 333,592 square feet office; the Park Plaza building, built in 1972, is 166,760 square feet. They were renovated in 1996. But they were only 50 percent leased when NYCB still had back offices there, an old Colliers listing noted.
According to the insiders, NYCB’s offer to potential buyers was a sale-leaseback, retaining its office space and ground-floor bank branch. A Detroit-area buyer had signed a purchase agreement and extended it before walking away last fall. Their intention was to repurpose the East 9th building with residential over ground-floor retail and retain the Chester building as offices, the sources said.
No connection between Flagstar and the buyer’s broker, Johno Norian of NXT Commercial Real Estate Services, could be established other than that they were both located in the Detroit suburbs. NXT is based in Plymouth. MI. Norian and Colliers’ reps didn’t respond to NEOtrans’ inquiries.
Ohio Savings Plaza still bore that name in August 2021 when this streetview was taken. But the fate of this building remains unknown. It is shedding tenants, it is no longer listed for sale and there is no news of a buyer. The only news is that it’s called Flagstar Bank even though a Flagstar Bank branch on its ground floor is closing soon (Google).
After the prospective buyer walked away, Colliers lost the listing. The rest of NYCB’s corporate real estate is handled by Cushman & Wakefield. The listing for the former Ohio Savings Plaza reportedly was moved over to them, but no public listing of the property could be located other than an old page on LoopNet.
None of the insiders had knowledge of what NYCB’s plans are for the former Ohio Savings Plaza/Park Plaza. Interestingly, FedEx refers to its retail locations as being in the “Flagstar Bank.” And Google lists the 1801 E. 9th building as “Flagstar Bank.”
“But I think the answer (to the branch’s closure) is probably obvious,” said Terry Coyne, vice chairman in the Cleveland office of commercial real estate services firm Newmark. “The foot traffic in Downtown Cleveland is terrible.”
Despite acquiring Flagstar and starting corporate restructuring to address its financial woes, NYCB is still hurting, reporting a net loss of $289 million for the third quarter of 2024, the company said in its most recent financial statement.
Since they share the same owner, the fate of the former Ohio Savings Plaza will also likely include that of the nine-story Park Plaza office building which overlooks Perk Park along East 12th Street between Chester and Walnut avenues. The Ohio Savings Bank sign on this building was removed last year. This photo is from 2022 (Colliers).
“Under Joseph Otting, a former comptroller of the currency who was named CEO in March 2024, NYCB has laid out a plan to return to profitability and vowed to shrink its balance sheet by reducing non-core assets,” according to an October 2024 Reuters article.
Ohio Savings Bank was founded in Cleveland’s Ohio City neighborhood in 1889. Its first bank, at 1866 W. 25th St., is still owned by NYCB but used by Flagstar. It is the same branch that will receive downtown’s accounts after that branch is closed.
Ohio Savings Bank grew slowly until the 1970s. Under the leadership of Leo Goldberg and then his son Robert, the company began a period of rapid expansion through acquisition of competing institutions while continuing its conservative lending practices. It expanded nationwide and, starting in 1989, renamed itself AmTrust Bank except in Ohio where it kept the name Ohio Savings until 2007.
But the bank failed two years later during the financial crisis and under the leadership of Robert Goldberg’s son Peter. At the end of 2009, NYCB agreed to purchase AmTrust Bank and put all of its branches and offices under the NYCB moniker. The exception was in Greater Cleveland where the name Ohio Savings Bank was revived and the back offices retained to “pay tribute to its forebear,” NYCB said.
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