Published by Crain's Cleveland Business - December 28, 2021
A group of busy developers closed out 2021 with a noteworthy deal: The purchase of a shuttered Ford Motor Co. plant in Walton Hills.
The sale of the 111-acre property is a milestone for this village of roughly 2,300 people. Ford was the largest employer — and a critical source of tax revenue — in Walton Hills until the automaker halted production at the 2.1 million-square-foot stamping plant in 2014.
Now Weston Inc., the DiGeronimo Cos. and Scannell Properties plan to remake the site as a modern business park, catering to tenants in light manufacturing, logistics, distribution and research and development. Through a joint venture, the developers closed on their acquisition of the property on Tuesday, Dec. 28.
The sale price doesn't appear yet in public records, and the buyers wouldn't divulge the figure. When the plant hit the market in 2018, Ford was seeking $9 million, according to listing materials from Howard Lichtig and Michael Toth of the CBRE Group Inc. brokerage.
In May, the same team of buyers paid $31.5 million for a former Ford plant in Brook Park. That property is much larger, though, at 195 acres. And it sits in a more prominent location, east of Cleveland Hopkins International Airport off Interstates 480 and 71.
The developers quickly moved to raze the Brook Park complex, to make way for a dozen or more new buildings at what they're calling the Forward Innovation Center. They hope to break ground in the spring for the first building — a speculative undertaking, with no tenant in hand.
In Walton Hills, the trio expects to demolish at least 75% of the old plant, where workers once stamped out bumpers, hoods, roofs, and quarter panels. The southern portion of the complex might be repurposed, depending on tenant demand for existing space, said T.J. Asher, Weston's president of acquisitions and development.
"We have some prospects that are interested," he said in an interview prior to closing. "If we can transact with those folks, we will keep it. And if not, it is likely that it would also get demolished."
The partners originally hoped to acquire the Walton Hills property last spring. The deal dragged on, though, as they worked with Ford to evaluate the condition of the site and the clean-up work required to prepare it for new uses.
"With older industrial properties, such as this site, it's very common that they have environmental concerns," Asher said. "And then the diligence at this site took a little longer to assess, to come up with a game plan, and that's why it took longer than Brook Park."
The developers plan to take the property through the Voluntary Action Program with the Ohio Environmental Protection Agency. That process provides property owners who research and address legacy contamination on a site with a legal release from liability.
"I think we'll be doing demolition or retrofitting, depending on the leasing efforts, by summertime. And hopefully a little sooner," said Kevin DiGeronimo, a principal with the group of companies that bears his family's name.
The developers plan to pursue grant money through the state's new brownfield remediation program, which debuted in December. For-profit applicants must be working with a local government entity to qualify for funding. Cities, counties, townships, villages, and various public agencies also can apply on their own.
Walton Hills Mayor Don Kolograf said the village stands ready to support a project that will bring back employment and eliminate blight at the southeastern edge of the community.
"We are excited that the sale has closed and the village is a major step closer to having a productive site with more jobs here in Walton Hills and Northeast Ohio," he said. "We look forward to working with the new owners."
The property, at 7845 Northfield Road, carries mixed-use zoning that permits industrial development but also allows for some entertainment and retail uses. Weston, DiGeronimo and Scannell believe the site could hold between 2 million and 2.5 million square feet of buildings.
It might take five to 10 years to realize that vision, DiGeronimo said.
Based in Independence, the family-owned DiGeronimo Cos. has a deep background in construction, demolition, and environmental work. Weston, another family-owned business that is based in Warrensville Heights, has an expansive industrial real estate portfolio in the Midwest and southeastern United States. Scannell is a national developer with headquarters in Indianapolis.
The companies independently chased one or both idled Northeast Ohio Ford plants before forming an equal partnership to tackle the mammoth redevelopments. During three years of marketing, the automaker and CBRE fielded dozens of offers on the properties.
"There's just not too many sites that have 100-plus acres," DiGeronimo said.
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