A Cleveland school levy on the Nov. 3 ballot and economic strains caused by the coronavirus pandemic dominated a discussion among downtown property owners at a recent Crain’s forum.
During the hourlong program on Tuesday, Oct. 6, real estate developers Doug Price and John Carney expressed frustration with a softening apartment market and the prospect of rising taxes. Playhouse Square CEO Gina Vernaci, meanwhile, suggested that there’s an opportunity in this unwelcome pause — a chance to consider, and plan for, what’s next.
“If history is our teacher on this, 100 years ago we had a pandemic,” she said. “And we had a world war. And we had a financial crisis. And these theaters at Playhouse Square were built at that time, and when they opened, people were lined up around the block to get in.
“So we know that people want to come back downtown. We’re human beings. We want to gather. How can we not waste this time wishing for it to be different, as opposed to using this time to make this a friendly environment for development?” she asked.
The forum, originally set for April but delayed by six months, morphed into a virtual program reframed by a public health crisis and recession.
Carney, co-founder and managing partner of the Landmark Companies, said his downtown apartment properties are feeling the effects of heightened competition from recent projects, a pandemic that’s nixed events and a May 30th riot that’s left some people skittish about venturing to the central business district.
“All of us downtown are kind of poaching off each other,” Carney said, noting that landlords are offering deals to attract tenants. “It’s not healthy, but it has to be done.”
Price, CEO of the Willoughby-based K&D Group Inc., controls 2,500 apartments stretching from Public Square to Playhouse Square. He was worried about overbuilding even before the pandemic. Now K&D’s suburban properties are full, he said, but recent traffic downtown has been abysmal.
Playhouse Square, which owns the sleek new Lumen apartment tower on Euclid Avenue, has a rosier view.
“We are actually quite pleased with the results so far,” Vernaci said of interest in the 318-unit project, which is 27% leased.