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CLEVELAND-It has been a year of ups and downs for the Penton Media Building, a 560,000-sf class A office building Downtown. Earlier this year, the building lost two major tenants totaling approximately 90,000 sf. The larger of the two departing tenants, a law firm that had been in the building for 30 years, vacated 70,000 sf on floors eight, nine and 10 on Jan. 1.

Then there were the ups. In a series of deals, the building has landed five new tenants totaling about 95,000 sf. These new tenants, which signed long-term leases of 10 years or more, are PR Newswire, a news and information distribution service, at 29,000 sf; Hickman & Lowder, a law firm, at 10,000 sf; HWH Architects, an architecture, planning and engineering firm, at 24,000 sf; Tarolli, Sundheim, Covell & Tummino LLP, a patent law firm, at 12,000 sf; and Bonezzi Switzer Murphy Polito & Hupp Co. LPA, a law firm, at 20,000 sf.

Charlie Valentino, asset manager for building owner KBS Realty Advisors, tells GlobeSt.com that many of the new tenants were able to take advantage of current market conditions to upgrade their spaces at little additional cost. The Downtown office vacancy rate is 19.72%, and the class A vacancy rate is 14.1%, according to a CB Richard Ellis third quarter report. At the end of third quarter, the average asking rate for class A space was down to $20.13 per sf.

Valentino says that some of the absorption in the Downtown Cleveland office market is being driven by the need for more space by growing tenants, such as PR Newswire. In addition, the law firm that left 70,000 sf in the Penton Media Building now occupies 100,000 sf in another Downtown building. “Cleveland has been slower than some areas of the country to recover, but we are starting to see some growth,” Valentino says, adding that much of the expansion is occurring in the legal and service sectors.

Valentino expects the Penton Media Building, which is currently 88% occupied, to land another major tenant before year’s end. “We have a fair amount of interested prospects in the last month or two, but they have been slow to commit,” Valentino says, adding that there are three prospects looking at leasing a full floor, about 30,000 sf, in the building.

Brian Hurtuk of CB Richard Ellis represented KBS Realty Advisors in all of the building’s recent transactions. Meanwhile, Doug Leary of CB Richard Ellis represented PR Newswire; Rocco DiPuccio of Colliers Ostendorf-Morris represented Hickman & Lowder; Chandler Converse of Trammell Crow Co. represented HWH Architects; and Scott Halloran of Trammell Crow Co represented both Tarolli, Sundheim, Covell & Tummino LLP and Bonezzi Switzer Murphy Polito & Hupp Co. LPA.

Located at 1300 E. 9th St., the Penton Media Building has been owned and managed by KBS Realty since 1997. The 20-story office building, which recently underwent a $7-million capital improvement, offers easy access to the Cleveland freeway systems and downtown retail, business and entertainment venues.

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