Six months in, Shaker Square’s new owners make plan to spend millions fixing up property

The new nonprofit owners of Shaker Square have completed a capital needs assessment of the property, and it calls for investing more than $7 million into the complex, which faced foreclosure last year. 

Cleveland Neighborhood Progress and Burten Bell Carr Inc. bought the property from The Coral Company in August for $11 million with help from the city of Cleveland. Since then, they have been meeting with merchants, doing repairs, and completing an assessment of improvements to the property.

Tania Menesse, CEO of Cleveland Neighborhood Progress, said the owners expect to start work on the roofs and other big ticket items this spring, and for repairs and upgrades to take at least three to four years “with a lot of significant work happening in the first one to two years.” 

“When we took ownership, our commitment to Cleveland and the community was to stabilize Shaker Square,” said Menesse in an interview with The Land. “We wanted to really focus on the needs of the tenants who have stuck with the square through thick and thin, and also improve the experiences of people who come to the square.” 

The new owners received $12 million in low-interest loans from the city of Cleveland and purchased the property for $11 million. After closing costs and other fees, there was about $800,000 remaining of the original funds, Menesse said. The owners dedicated about $300,000 of those funds towards “immediate repairs” such as plumbing repairs, correcting electrical hazards, landscape maintenance, and other outstanding issues. 

Now, after months of planning and meetings, the new owners are ready to get to work on big-ticket projects. The group recently hired a construction manager to work with its property management team, which is part of the Cresco Real Estate group that also manages properties at Playhouse Square. Work will start on the roofs this spring in order to retain tenants and prevent additional water damage to the buildings, project consultant Terri Hamilton Brown told the community action group Shaker Square Alliance at a March 2 meeting. 

Tenant recruitment, retention, and feedback

In the meantime, Menesse said, they’re also working with property managers from Fass Real Estate in Shaker Heights to retain existing tenants and recruit new ones to the square. Overall, the tenant mix is not changing significantly. 

“We are recruiting tenants to the square that will complement the current tenant mix and add immediate value to the surrounding residents,” Menesse said. “We know that food, food, and food along with experiences like the movie theater and Cleveland City Dance and conveniences like the dry cleaner are what draw people to the square.” 

Additionally, the owners have continued contracting with Block by Block, which also manages downtown Cleveland’s Clean and Safe program, to provide maintenance and security services at the square. 

Courtney Laves-Mearini, owner of Cleveland City Dance, said she believes the new owners are making progress. “They’ve been moving forward with things like they said they would,” she said. “They’re communicating well with tenants. When we call them they respond immediately, which is so refreshing. We’re looking forward to seeing how they can help the square grow and improve and get good tenants for the long term. We’ve been here since 2008 and have seen a lot come and go. They’re improving the square piece by piece. I’m happy with what they’re doing.”

Scott Kim, owner of SASA restaurant, said the situation at Shaker Square has improved since the pandemic. “During the pandemic, we didn’t have a landlord,” he said of when the property was going through the foreclosure process and being managed by a receiver. “Now we have a new owner and there’s some funding for updates and repairs. So, it’s improving. I’m hopeful.”

Paying for improvements

As far as improvements go, the new and upgraded roofs are estimated to cost $4.3 million, according to Menesse. Electrical upgrades are expected to cost $218,000, HVAC work $1.2 million, parking lot upgrades $525,000, facade work $689,000, plumbing $75,000, concrete work $113,000, lighting $217,000 and awnings $146,000. All told, improvements add up to $7.5 million, but that number could rise closer to $10 million with inflation, said Menesse. 

The owners have raised $5 million so far, she said, including $2 million in Cuyahoga County ARPA funds, $1 million from a program-related investment from the Cleveland Foundation, $500,000 from Village Capital Corporation, $1 million from Community Development Advisors, $500,000 from the George Gund Foundation, and $250,000 from the Saint Luke’s Foundation. Funds will be available to draw down as the project is completed, Brown said, but they still need to raise additional money to complete all of the items on the list. 

Infrastructure improvements and community engagement are moving forward

Marketing firm and Shaker Square tenant Shark and Minnow is creating a new website for the square that will launch soon, and the owners have created an email distribution list so people can get updates on their progress (sign up here). Brown and Menesse said a separate community engagement process for the future of the square will kick off this year, and they touted the need to engage the community, involve artists, and create more programming on the green space at the center of the square. “The overall vision for the square will come together over the next year to 18 months based on a community engagement process that BBC will lead,” said Menesse. 

Separately, the city of Cleveland is redoing North and South Moreland boulevards around Shaker Square, a $7 million project that will kick off this spring and last a year, according to the city’s website. The street re-do will add new curbs, sidewalks, ADA-compliant curb ramps, and drive aprons. The city will also replace water lines and improve safety at intersections. The street will be reconfigured to include one traffic lane, turn lanes, on-street parking, bike lanes on South Moreland, sharrows (bicycle pavement markings) on North Moreland, and shared lanes. 

“It will be very disruptive, there’s no way around that, so we all have to work together,” Brown told the Shaker Square Alliance. “It’s starting this spring, so let’s get on with it and get it done.” 

Shaker Square is accepting and planning for change

Despite the square’s troubles, the property is about 87% leased, Menesse said. Although there were recently some turnovers, with Balaton and Biggby Coffee leaving the square, Menesse said they’re working to fill these spaces. “It’s inevitable and probably healthy to see some changes at Shaker Square,” she said. 

Brown said the property’s leasing agents at Fass Real Estate Services in Shaker Heights are working to recruit a locally owned coffee shop. “Anybody who’s serving coffee in the Greater Cleveland area, we’re talking to them,” said Brown. “We envision the environment as a kind of third space. We want a coffee shop where people can buy coffee, bring food, but also gather. I would say we have some leads.”

Menesse said there’s no specific time frame for owning the property before selling it, but noted that the mortgage with the city is only for five years, so she anticipates a possible change of ownership at that point. Until then, she said, the owners are plugging away at making improvements that they hope will benefit the square in the long-term and bring merchants and people back there. “We can’t turn around two years of real neglect overnight,” she said. 

Note: This article has been updated to reflect the fact that $300,000 has been spent so far on improvements to the square, not $800,000 as originally reported.

Sign up for Shaker Square email updates here or follow Shaker Square on Twitter or Facebook. Shaker Square Alliance meetings are the first Thursday of every month at 10 am. Learn more here.