You are using an older browser version. Please use a supported version for the best MSN experience.

Beachwood Council approves abatement deal for 3800 Park East luxury apartment, worker space development

The Plain Dealer  Cleveland logo The Plain Dealer Cleveland 2/18/2021 Jeff Piorkowski, cleveland.com

BEACHWOOD, Ohio — City Council voted Monday to approve an abatement for developers planning to convert the former Genesis Healthcare nursing facility at 3800 Park East Drive, into a building that will house 146 luxury apartments.

The deal will allow for a 10-year, 50-percent property tax abatement on the value added to the building, as determined by Cuyahoga County. Developer Rico Pietro, a principal with Cushman & Wakefield/CRESCO Real Estate, said that the total development cost stands at between $18 million-$19 million.

Plans call for the building to include a first-floor business accelerator/co-work space for start-up companies or those who desire a short-term lease for office space. Working with Pietro are partners that include project manager Benchmark, construction manager Marous Brothers Construction, Bowen Architects and Real Estate company My Place Group.

Council discussed the project during a committee meeting Feb. 1 and voted by a 6-1 margin Tuesday, Feb. 16, to approve the agreement. The project falls within the city’s recently expanded community reinvestment area (CRA).

The only vote cast against the CRA agreement was by Councilman Mike Burkons. Burkons told Pietro during the online City Council meeting that, if council approved the deal, he wished them success. Burkons voted against the agreement because he does not believe the city should be showing favor to one apartment project after not having done the same for others.

In an email to cleveland.com sent after the meeting explaining his vote, Burkons wrote: “Despite COVID, the apartment industry is doing very well in northeast Ohio. In Cuyahoga County, vacancy levels are near historic lows at 6 percent for suburbs of Cleveland, but Beachwood’s 2,435 apartment units are at 10.1-percent vacancy, the highest in the county for cities with more than 200 apartments.

“The owners of 3800 Park East got Council to approve the zoning change in 2019 and are free to convert their property into 146 apartments. If they decide to do so, why should we give them an annual $258,773 subsidy to compete with every other apartment property in Beachwood that is already struggling with vacancy levels, and has always paid their full property tax burden?

“The Astor apartments’ (3600 Park East Drive) owners invested over $40 million to take that property from a closed Bally’s gym generating only $38,000 a year for the school district, into 206 high-end apartments now generating $811,000 a year for the schools. They shouldn’t have to compete with 146 new apartments just a few hundred feet up the street that have the unfair advantage of receiving an annual $258,773 subsidy for the next 10 years.”

Burkons asked Pietro during the meeting why the developers could not proceed with the project without abatement.

“I think it’s a very good question,” Pietro replied. “I think our new units are somewhat limited because of the framework of the existing building.” Pietro said that, because the building was originally built 31 years ago as a nursing facility, “We were limited by the size of the existing structure.” He added that certain parts of the structure, as it was originally constructed for nursing home use, have made it more difficult to remodel for use as luxury apartments.

“Our approach is to spend more money on non-rented space. As an example, our amenity area, so that a resident at this location, although he may not have as much square footage behind his entrance door, he has other community space to offset that providing an ideal experience, with the benefit of living within the city of Beachwood in close proximity, hopefully, to where they work, and with best-in-class services.”

The developers plan to add rooftop amenities to the project. They will also install a 100-car parking lot in the undeveloped property which lies between 3800 Park East and the neighboring Beachwood fire station number two. The developers will allow the city use of the parking lot, as the fire station is in need of more parking because it is frequently used for training by other area departments.

No other council members commented before the vote was taken.

The project, first proposed in 2019 without the business accelerator aspect, will next be reviewed by the city’s Planning Commission, then the working drawings will be prepared for the city’s building department.

Summer activities

Mayor Martin Horwitz said at the start of Tuesday’s council meeting that many people are asking him about summer activities in Beachwood because city offerings, including the Beachwood Family Aquatic Center, were closed last summer due to the pandemic.

“We’re going to try and open the pool, we’re going to try and run our camps within the boundaries the state permits, and our county board of health permits and the CDC permits,” Horwitz said. “That’s our goal. Assuming things get better as the weeks go on, assuming more people get vaccinated, and the state says it’s safe to open the pool and run our camps. We may not get that guidance until March or April, (but) our intention this summer is to open the city.”

See more Sun Press news here.

AdChoices

More From The Plain Dealer

The Plain Dealer  Cleveland
The Plain Dealer Cleveland
AdChoices
image beaconimage beaconimage beacon