The Memphis & Pearl development in Cleveland’s downtown Old Brooklyn neighborhood had to be expanded to retain a federal grant for the project while retaining the historic St. Luke’s Church. But that caused a gap in the project’s funding resources that backers are now trying to fill (Desmone). CLICK IMAGES TO ENLARGE THEM.
Filling gap in capital stack, design reviewed
Due to funding policy changes at the U.S. Department of Housing and Urban Development (HUD) since January, backers of the Memphis & Pearl development in Cleveland’s Old Brooklyn neighborhood have had to scramble to save the project from a suddenly large, $15 million funding gap.
HUD committed a $3 million Community Development Grant for the $42.3 million project. But its new policy forced a big jump in project costs but without a comparable increase in revenues.
Considering grants are hard to come by, the project’s backers led by the property owners Old Brooklyn Neighborhood Development Corp. (OBCDC) and Pearl Road United Methodist Church (PRUMC), decided to keep the grant and pursue additional funds despite HUD’s micromanagement of the project.
That funding pursuit includes a 30-year non-school tax-increment financing request that includes tax abatement for the structures but not the land, said OBCDC Interim Executive Director Amber Jones. Construction on the project could start by the end of the year.
With city council due to go on recess for the summer starting a month from now and the clock ticking on other pieces of funding for the Memphis & Pearl project, council needed Planning Commission to sign-off on a chain-of-title property ordinance to secure tax increment financing for the project. The commission supported it unanimously at its regular meeting yesterday.
At Memphis Avenue and Pearl Road, the Greenline Building at left and the vacant St. Luke’s Education Building at right are to be demolished while the St. Luke’s Church in the middle will be preserved and renovated (Desmone).
“HUD loved our math months ago,” said Ward 13 Councilman Kris Harsh told commission members. “Things have changed in (Washington) DC. HUD wants us to increase the number of units and decrease rent which changes our economic capital stack. The project is still moving forward but now we have to apply for the TIF which we planned to do it without.”
So the project will increase its unit count from 74 apartments to 84 without increasing its six-story height. That will require an increase in the number of smaller, more affordable workforce apartments and remove a step-down at the top of the six-story building. The good part, backers say, is that it will increase the number of people and activity in downtown Old Brooklyn that needs a shot in the arm.
“Currently at the intersection of Memphis and Pearl is a vacant building, a vacant building, and another vacant building adjacent to the fourth vacant building,” Harsh said. “That’s our downtown Old Brooklyn and that’s not good. So we have a very exciting project that will invest in that most central corridor in the neighborhood by preserving a 120-year-old church.”
The Memphis & Pearl development is across the from street from another redevelopment project — a $5.5 million renovation and conversion of two adjacent commercial buildings into 30 apartments. One is the South Brooklyn Savings Loan & Co., 4209 Pearl Rd., and the other is the Broadview Savings & Loan Co., 4221 Pearl Rd.
A view of a public plaza next to a renovated St. Luke’s Church in Cleveland’s Old Brooklyn neighborhood. A new 84-unit workforce apartment building is barely visible beyond the historic church (Desmone).
St. Luke’s Church, built in 1903, will be preserved by sacrificing the church’s school, called the Education Building — a matching structure that was added on to the church in 1927.
The school will be demolished and the church repurposed into a commercial structure, possibly a craft brewery. Also to be demolished is the Greenline Building, 3426-3434 Memphis. The demolitions were approved by the city in December 2024.
Charles Kennick, OBCDC’s neighborhood development director, said the community development organization acquired portions of the abandoned church-school property in 2019 and expanded the site in 2021 by adding the Greenline Building property. A development group led by Pittsburgh-based Desmone was selected to pursue the project in 2022.
“Since the eight-story Deaconness Hospital was built in 1930, this will be the most impactful project in 95 years in Old Brooklyn,” Harsh continued. “For a middle neighborhood, this is the type of investment that will secure the future of the largest neighborhood in Cleveland for another century. We’re terribly excited about this.”
This is the capital stack for Memphis & Pearl, which now has a funding gap resulting from new federal rules. Funding sources for projects such as Memphis & Pearl development are tight and very complex. Private investors won’t fully fund most developments in Cleveland which has the lowest rents among the nation’s 40 largest metro areas while having higher than average construction costs (Desmone).
He said the project is aligning with other major public investments in the neighborhood like the 4-mile MetroHealth Line bus rapid transit project on West 25th Street from Detroit Avenue to downtown Old Brooklyn. That $50 million project is under design by the Greater Cleveland Regional Transit Authority but still needs about $23.7 million in federal money so construction can begin in .
“This will be the first significant project south of our hot market neighborhoods in Ohio City and Tremont that is really focusing its design on transit-oriented development,” Harsh said. “So we’ve been in great communication with county planning, the RTA and city planning to make sure that the building is designed and focuses its residents on using that as an asset and a resource.”
HUD’s input caused the project’s physical design to be changed but only slightly. On May 14, the Near West Design Review Advisory Committee officially recommended that the latest conceptual design for the Memphis & Pearl development be approved by the Cleveland City Planning Commission at a future meeting.
“With the community’s priorities at the forefront, we grounded this design in Old Brooklyn’s heritage while positioning it for the future,” said Geoff Aiken, regional vice president of Desmone Architects in a written statement. “It strikes a balance between modern function and timeless character, complementing the surrounding architecture and streetscape.”
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