CLEVELAND — One of Downtown Cleveland’s largest office towers is set to hit the market soon, as the federal government tries to slash spending and trim its footprint.
But experts say the Anthony J. Celebrezze Federal Building will be a tough sell.
“Even if you gave it to me for free, I don’t think I would take it,” said Terry Coyne, a vice chairman in the Newmark real estate brokerage’s Cleveland office.
Built in the 1960s, the Modernist office tower on East Ninth Street is a 32-story fixer-upper. It’s home to 4,000 workers, employed by agencies ranging from the Defense Finance and Accounting Service to the Veterans Benefits Administration and the IRS.
The government hasn’t formally listed the building for sale yet. But the General Services Administration recently told Congresswoman Shontel Brown’s office that the property will show up soon on a list of federal real estate slated for “accelerated disposition.”
The GSA, which manages a massive federal real estate portfolio, aims to sell the Celebrezze building in the next three years. A spokesman for Brown, a Cleveland Democrat, told News 5 that the GSA plans to disperse the tenants across smaller, leased spaces.
It’s unclear, at this point, whether those leased spaces will be in Cleveland.
Now, city officials and civic leaders are fighting to keep thousands of jobs – and key government services – Downtown. And they’re facing the prospect of another empty office building in a central business district that still hasn’t recovered from the pandemic.
“We want to keep the jobs that are here. … We also want to continue to make our case to the federal government that Cleveland is a great place for federal jobs – and maybe there’s an opportunity to grow even more here,” said Michael Deemer, president and CEO of Downtown Cleveland Inc., a nonprofit dedicated to building up the center city.
He’s heading to Washington, D.C., later this week to talk to lawmakers as part of an annual advocacy event set up by the International Downtown Association. The future of the Celebrezze building will be part of those conversations.
“Office workers are a very, very important part of the Downtown economy,” he said. “They help drive business for all of the shops and restaurants that we know and love.”
Deemer said the best use for the Celebrezze building is still federal offices – and there’s room for the government to grow there, filling empty space in a relatively affordable city.
“The federal government has invested millions of dollars in this building over the years that they’re unlikely – unlikely at best – to recoup in a sale,” he added.
The recent investments include a massive undertaking to put a second skin around the building – a glassy wrapping designed to save energy and fix significant deterioration of the original façade. That project cost about $120 million and wrapped up in 2016.
Federal records show the building needs other major repairs, including millions of dollars of water-pipe replacements to prevent flooding in the lower levels.
Coyne said the maintenance backlog is likely to be a turnoff for any private developer.
“It’s either going to sell for a dollar to someone willing to take a risk,” he said, “or the government’s going to have to figure out a way to give money to whomever buys it.”
Demolition would probably be cheaper, added Coyne, who works right next door.
“If it were torn down and made a park, would that be the worst thing in the world?” he said, looking out a window at the plaza surrounding the tower.
Deemer said the building, unlike many older Downtown office properties, isn’t a good candidate for an apartment makeover or hotel conversion. The space doesn’t lay out well for other uses.
And there’s not enough demand from businesses to fill the space – close to 1.2 million square feet, according to GSA records.
“We do not see its future as a multi-tenant, private office building. … The office market is just not that strong in Cleveland or other downtowns right now,” Deemer said.
As of Monday afternoon, the GSA was advertising 16 properties across the country for swift sales. They included a federal office building in California, a warehouse in New Mexico, and a courthouse in Iowa. None of those buildings are anywhere near the size of Celebrezze.
In an email to News 5, the GSA confirmed that it’s laying the groundwork for a sale here. “More details will be forthcoming,” a spokeswoman wrote.
The agency is complying with a cost-cutting directive from President Donald Trump and trying to solve “long-term problems” with its real estate, she added.
“Decades of funding deficiencies have resulted in many of the assets in our portfolio becoming functionally obsolete and unsuitable for use by our federal workforce,” she said. “GSA will consider assets for divestment from government ownership in an orderly fashion to ensure taxpayers no longer pay for empty and underutilized federal office space, or the significant maintenance costs associated with long-term building ownership.”
GSA records show the Celebrezze building is about 80% leased.
“We own a lot of federal office space in Cleveland already. It’s not very well utilized,” U.S. Sen. Bernie Moreno, an Ohio Republican, said during a recent interview with News 5.
He believes the Celebrezze building can be repurposed for private-sector use.
The tower is located in the city's Erieview Historic District, which was added to the National Register of Historic Places in 2021. In private hands, the building could be eligible for federal and state tax credits for historic preservation. But it isn't protected from demolition.
“It’s a huge building,” Coyne said. “And if it sat here and became a zombie building, that is not good.”
In a statement in late March, Rep. Brown described the sale plan as “reckless.” Cleveland Mayor Justin Bibb and Cuyahoga County Executive Chris Ronayne chimed in, advocating to keep the lights on and keep federal jobs Downtown.
RELATED: Local officials to feds: Don't sell Celebrezze building
Brown is scheduled to testify about the importance of the Celebrezze building on Tuesday, during a House subcommittee hearing on pruning the federal real estate portfolio.
On Monday afternoon, federal workers trickled through the tower’s front doors on their way to lunch or a cigarette break. Patrons popped in for appointments with U.S Citizenship and Immigration Services, the IRS, and other agencies.
Darryl McKnight Jr., 38, was visiting the Social Security Administration office. He hopes the public-facing federal agencies stay Downtown, at least, in a convenient location.
Another Social Security customer, 60-year-old Sir London, was shocked to hear the federal building could shut its doors. “That’s not good. Why would they do that?” asked London, who lives Downtown.
For him, the tower is a hub for essential services – and a city landmark.
“I definitely wouldn’t want it to leave,” he said. “It’s been here all my life.”
