Enterprise Leases 30,500 SF for Local HQ

The deal was somewhat complicated. Developer Carnegie Management and Development bought the company's former 12,000-sf building in Westlake, and agreed to build the new facility in Strongsville and own that property as well. Howard Lichtig, VP with CB Richard Ellis' Brokerage Services Group, says Enterprise looked at many sites for its expansion, and settled on this plan to solve a few problems. "Their business is going gangbusters," he tells GlobeSt.com. "They didn't want to own anymore, and wanted a lease. They liked the Carnegie-owned property. Then they listed their 12,000-sf building for $1.5 million, and Carnegie bought that as well."

Enterprise, the former sole tenant of its Westlake building, is going to lease back about 2,500 sf there for five years. "We have some undisclosed tenants interested in the rest of the building," says Dan Rose, director of development and leasing for Carnegie. "We'll be asking rates comparable to the market, at $20 to $22 per sf." The property is on four acres with Interstate 90 frontage.

Lichtig says he can't comment on the exact lease rate of the new building. "The average market rate of newly constructed class a space would be between $23 and $25 per sf, triple net," he says. The lease was difficult to put together, Lichtig admits. "There's a lot of opportunities in this market for smaller existing space. If they had been in the market for 5,000 sf to 10,000 sf, we might have had 20 places for them to look at; but because they needed a large amount, there were really only five alternatives, and only three of them decent. With this building they get exactly what they want, and a seven-acre site for extra parking of their rental cars that come in from other states."

Rose says Cleveland is not seeing a whole lot of demand for large office spaces. "Given the bad news around here, it's good to have a positive deal," he tells GlobeSt.com. "We're not exactly experiencing the upturns that other cities are. We're holding our own, but most of the growth are from existing companies." Construction of the new building will begin in the spring. Rose said he cannot comment on the cost of construction.