By Barbra Murray
The glass-clad, Class A office high-rise known as 1111 Superior Ave. in Cleveland has just changed hands. With the assistance of commercial real estate and capital markets services provider HFF, American Landmark Properties Corp. sold the 559,300-square-foot property to Zamir Equities LLC.
“We had a strong showing of investors for a highly sought-after, value-add office investment in downtown Cleveland,” Jaime Fink, senior managing director with HFF, told Commercial Property Executive. Joining Fink in the representation of American Landmark were Jeffrey Bramson and John Merrill, fellow senior managing directors, in addition to Bryan Rosenberg and Patrick Shields, directors with HFF.
1111 Superior made its debut in Cleveland’s central business district in 1983 and underwent its most recent renovation in 2014. Today, the 28-story property is 83.4 percent leased and home to the likes of IBM Corp., MetLife Services & Solutions, Asurint and the Cleveland Metropolitan School District, which holds the anchor position with nearly 92,500 square feet at the LEED Silver-certified property. The investment community took note.
According to Fink, potential buyers were attracted to 1111 Superior’s diverse tenancy, state-of-the-art amenities and the “mark-to-market opportunity with below-market rental rates.”
HFF and other parties involved in the change in ownership of 1111 Superior are keeping mum on the sale price. The property last traded for $19.5 million in 2014, when it was just 50 percent occupied due to original anchor tenant Eaton Corp’s exit. Per Cuyahoga County records, 1111 Superior has a 2017 taxable market value of nearly $33.9 million.
The Cleveland appeal
As noted in real estate investment services firm Marcus & Millichap’s 2018 forecast for Cleveland, “Declining vacancy and a stable economy will buoy investor interest in the Cleveland office market this year.” The prediction is proving true.
In addition to the 1111 Superior transaction, notable office deals year-to-date include Rugby Realty’s acquisition of the 575,000-square-foot Aecom Centre for approximately $36.9 million and KRA Management’s $16.7 million purchase of the Tower at Erieview, a 770,000-square-foot building. And a group of investors including DRA Advisors and the Wolstein Group snapped up 200 Public Square, a 1.3 million-square-foot office skyscraper, for $187 million.
Image courtesy of HFF