The vacant former IBM Explorys headquarters at Cedar Avenue and East 105th Street will be acquired by Canon Healthcare USA for its new headquarters. This acquisition, in partnership with the Cleveland Clinic and others, represents a first step toward a lot more investment in the surrounding area, including advanced manufacturing (Google). CLICK IMAGES TO ENLARGE THEM.
Partnership with Clinic, others, is first step
Over the past several years, Canon Healthcare USA was considering multiple locations inside and out of Greater Cleveland for its new headquarters. While most real estate insiders believed it would land at the former IMB Explorys headquarters, 10500 Cedar Ave., in Cleveland’s University Circle, it was not a done deal. With the city’s passage of a job creation income tax credit last night, it now appears to be.
Passed on emergency, Cleveland City Council approved a five-year, 50-percent payroll tax credit on the 2.5 percent income tax withheld by Canon. The 43,000-square-foot facility built in 2018 will research and development of imagining technologies. Amid recent bad news, securing Canon Healthcare USA’s HQ was a big win.
Canon will invest $33.65 million to buy and retrofit the new building which is owned by Geis Companies. And it will create 50 new full-time jobs with an average salary of $150,000 and an annual payroll of $7.5 million, according to a Jan. 30 letter sent to council by Tom McNair, director of the city’s department of economic development.
“This investment will transform the facility into a state-of-the-art imaging and research center, housing Canon’s national headquarters and serving as the base for all its medical product lines,” McNair wrote.
“We’ve been working on this for a long time,” said City Council President and Ward 6 Councilman Blaine Griffin in a phone interview with NEOtrans. “They’re going to be hiring and bringing in jobs from California and Tokyo, Japan. This is a huge win not just for my ward or for Cleveland but for the region.”
Looking north on East 105th Street toward the Cleveland Clinic’s main campus, the white building that will become Canon Healthcare USA’s HQ is visible on the right. In the foreground is the Aura at Innovation Square and the Medley at Fairfax Market is just beyond it. Owners of houses on the right were reportedly offered purchase agreements so they could be demolished for future development (LoopNet)
“This project is key to attracting and retaining a major global company like Canon, which will create high-tech jobs, stimulate indirect activity from suppliers and contractors, and revitalize a previously vacant property,” McNair continued.
Council members were briefed on the project by Tsuneo Imai, Canon Healthcare’s vice president of strategic partnerships and collaboration, at a committee meeting. The new HQ will generate $2.25 million in annual income tax, $1.5 million in annual property tax and an additional $469,000 in payroll taxes during the first five years.
Griffin said that Canon’s investment at this location bodes well for the surrounding area, called the Innovation District, to which the state of Ohio has provided $265 million to support. It is located at the east end of the new Opportunity Corridor Boulevard.
“If it’s successful, we can do even more in this district, attracting more more jobs and more services like the Meijer market, and 2,000 new units of housing that have been within a half-mile. This goes into alignment with the plan to attract innovative manufacturing and others employer in the area.”
“Canon’s presence can drive innovation in the Health-Tech Corridor, foster collaborations with local universities and startups, and elevate the city’s status as a tech and research hub,” McNair said in his letter. “Additionally, hosting a renowned company like Canon will enhance Cleveland’s international profile, attracting further investment and partnerships.”
In less than a decade, the stunning change is evident along East 105th Street at the east end of the Opportunity Corridor. In the 2023 image, Canon Healthcare USA’s future headquarters is visible at far-right (KJP).
Griffin said the Cleveland Clinic, which owns the 1.5 acres of land the Geis-owned building sets, will also be adding research jobs to the facility as part of its partnership it formed in late 2023 with Canon Healthcare USA.
The number of Clinic jobs being considered for this facility has not been publicy disclosed. While the Clinic has laid off some administrative personnel in some areas, it is adding jobs in others including at new buildings it is constructing at its Main Campus.
Angela Smith, senior director of corporate communications at Cleveland Clinic, declined to comment on the Canon partnership.
The city, county and nonprofit development corporations like University Circle Inc. and Fairfax Renaissance have been steadily acquiring properties within several blocks of both sides of East 105th in recent years to accommodate more research, medical and manufacturing facilities. There are only a few parcels left that are in private hands,
“It’s what we usually do to try to avoid speculating,” Griffin said. “There’s nothing imminent right now, but if people believe this is happening, they try to jump in. With us acquiring the land, we can control the development space.”
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