Nine-story Euclid office building sells for $1.5 million

The hulking nine-floor Euclid Office & Medical Plaza has a commanding presence on a ridge overlooking suburban Euclid and Lake Erie. It also has a 50% vacancy rate, which its new owners see as an opportunity in the battered office market.

And it’s exactly the type of overlooked asset that attracted the husband-and-wife owners of Man Holdings LLC, Haim and Amanda Mayan, to Cleveland from Miami six years ago.

“It’s a heavy lift, but we see it as an opportunity to create value where others have seen liability,” Amanda Mayan said in a phone interview.

Through Euclid Office Campus LLC, the couple on Dec. 9 paid $1.5 million for the structure, according to Cuyahoga County property records. The building has more than 160,000 square feet of office space and sits on a 60-acre site.

The purchase price is in line with the current market value of $1.2 million the county assigns the property. The seller, a Mentor investor group, in July 2001 paid $2.3 million to a lender that had recouped the property in a foreclosure proceeding.

The couple has worked in the multifamily affordable housing space on the East Side and in the eastern suburbs since 2014. They moved into the office market for the first time in 2019 with a similar project, a former medical office building on Shaker Boulevard in Cleveland, that they’ve spruced up and re-tenanted.

“We don’t always go with trends. We don’t believe the office market is dead,” Amanda Mayan said, noting the rise in new business incorporations reported by the Ohio Secretary of State’s office.

Although they are open to adding medical office tenants to the building, the Mayans hope that startups and small businesses can be attracted to the building with attractive rents (which they won’t disclose) and flexible terms. The new name for the building is Lake View Enterprise Campus. Amanda Mayan said the new name reflects the terrific view of the lake from the structure’s top floors.

Plans call for establishing a communal office in the building where small businesses can rent individual offices in the 100- to 200-square-foot range but share the reception area.

“We’ve found that tenants may start small but in a year or two need 1,000 or 2,000 square feet of office space, and we will work with them to expand in the building with flexible terms,” Haim Mayan said.

The Mayans plan to rejuvenate the building’s lobby and halls, updating lighting with LED bulbs and fixtures, solar power and cosmetic updates. Haim Mayan said the building’s mechanical systems have been well-maintained.

The couple also expect to add a detention basin on the property as well as islands of grass and trees to the massive parking lot, similar to what they did on Shaker Boulevard.

The solar power and tree canopy are part of improving the immediate environment, Amanda Mayan said.

“We believe tenants like to be a part of such initiatives and see their rents supporting sustainable efforts,” she said. The structure’s 600-car parking field also means there is plenty of room for such efforts.

Rico Pietro, a principal at Cushman & Wakefield Cresco of Independence, said the Mayans saw the building as a “value-add proposition” and were willing to work in the more entrepreneurial startup side of the market that some office investors eschew.

There were multiple buyers for the building when the asking price dropped below $2 million, Pietro said.

Pietro and David Leb, a Cresco vice president, represented the buyers in the transaction. Eric Schreibman, also a Cresco vice president, represented the seller in the deal.

Geoffrey Coyle, an executive managing director of the NAI Pleasant Valley brokerage in Independence, said such an investment is challenging while businesses try to figure out how to navigate their options in the pandemic era.

“I think it’s only a matter of time before many business owners decide it’s time to get back to the office for business culture reasons,” Coyle said. But the question is how long it will take for that to happen more than two years into the COVID-19 pandemic.