The Cuyahoga Land Bank, Gies Companies – Cresco Real Estate join together to bolster the Shore Bank Enterprise Center
Facing financial difficulties in the aftermath of the Great Recession post-2008, the board of the Shore Bank Enterprise Center sought out the assistance of the Cuyahoga Land Bank late last year in an effort to prevent the need to shutter its building, which would displace more than 20 small business and non-profit tenants and add a vacant building to the city’s landscape. Through a partnership between the Cuyahoga Land Bank and Gies Companies–Cresco Real Estate, the Shore Bank Enterprise Center will be preserved and kept in productive use, with the building transferring ownership on March 31st.
The Shore Bank Enterprise Center, located at 540 E. 105th Street in Cleveland, has a long history of serving the Glenville community. During the 1990’s, civic leaders and foundations collaborated to secure a community development bank that had a mission to provide financing for community development and neighborhood projects in Cleveland, Ohio. These stakeholders, through investments in the building, successfully attracted Shore Bank, a community development lender from Chicago, which established its headquarters in what became known as the Shore Bank Enterprise Center.
The Center additionally became a creative incubator and continues to be the home for a number of small businesses and non-profits. Investment from the Gund Foundation, the Cleveland Foundation, the Greater Cleveland Partnership and the City of Cleveland boosted the Center into a vibrant venue not only for conventional tenants, but also non-profits such as the Evergreen Co-Op, which operates a non-profit laundry company servicing hospitals and other institutions as part of a workforce development program.
The Great Recession impacted the Center through the loss of several key tenants due to business closures starting in 2009. Most significantly, the largest anchor tenant, Shore Bank, dissolved, leaving the headquarters space empty.
By 2015, facing the prospect of prolonged operational shortfalls, the board was forced to consider closing the Center, which would displace all the tenants, including the Evergreen Laundry, and leave a large community asset in an unoccupied state. Instead of closing, the board sought the assistance of the Cuyahoga Land Bank, which immediately began to seek a way to save the Center.
After several months of discussions between the Cuyahoga Land Bank and the community lenders, the lenders agreed to release their debt, if the Cuyahoga Land Bank would take title and find a professional and experienced manager. A group headed by Fred Geis agreed to take on that management role, considering the Cuyahoga Land Bank’s ownership and release of debt.
After two months of evaluation and continued discussions with all stakeholders, the Cuyahoga Land Bank and the Geis group agreed that the Cuyahoga Land Bank would take title to the Center, while the Geis partner would both manage the facility and be responsible for all capital and operational shortfalls in exchange for ownership in the Center within three years.
“This is an incredible example of cooperation with our community development partners, the City of Cleveland and a community-minded private developer” said Gus Frangos, President and General Counsel of the Cuyahoga Land Bank.
Immediate plans for the Center include nearly $1 million of investment for new tenant improvements and to enhance the building. The vision is for the Center to prosper as a hub for creative non-profits and business start-ups.