CLEVELAND — A prominent local real estate developer is teaming up with the city of Cleveland and the Cuyahoga Land Bank to shape the future of vacant retail properties on the East Side.
First Interstate Properties Ltd. recently signed an agreement that gives the company an exclusive chance — and up to three years — to come up with a plan for the former Dave’s Markets site and neighboring real estate in the North Collinwood neighborhood.
Based in Lyndhurst, First Interstate has a track record of building shopping centers and housing. The company’s past projects include Steelyard Commons in Tremont, Legacy Village in Lyndhurst and the One University Circle apartment tower in Cleveland.
In North Collinwood, First Interstate is studying the potential of a roughly 6-acre site owned by the city and the land bank. The three organizations inked a feasibility assessment agreement in January that gives the developer the ability to start exploring a project — and an eventual path to buying the property, if the numbers work and everyone agrees.
“There’s really not a great sense of what the value of that land is at this point. There’s really not a great sense of what can happen there. But what there is a great sense of is that the parties involved, including First Interstate, want to put their best foot forward to think through and do the planning around what can happen,” Mitchell Schneider, the company’s founder and executive chairman, said during an interview this week.
The agreement mentions the prospect of a “residential project,” which could mean apartments or rental townhouses, and “a grocery-based tenant.”
Dave’s closed the store at 15900 Lakeshore Blvd. in 2022, after serving the area for almost four decades. At the time, city officials said the decision was spurred by declining sales, cash-strapped shoppers and friction between Dave’s and its landlord.
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A company affiliated with Simon’s Supermarket bought the property a few months later, but ended up sitting on the building. Last year, the city stepped in, paying nearly $1.5 million to gain control of 4.24 acres along a key commercial corridor near Lake Erie.
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“It’s … the type of property that can, frankly, swing a neighborhood,” Tom McNair, the city’s integrated development chief, said during an interview Friday.
By teaming up with the land bank, the city expanded the project footprint to include a long-vacant Ponderosa Steakhouse next door, on about 1.6 acres.
The land bank, a quasi-governmental nonprofit dedicated to clearing out blight and rebuilding neighborhoods, received the former restaurant as a donation in 2023 and has been sitting on it, waiting for the right moment to come along.
“Once the land’s cleared, the possibilities are endless,” said Kim Steigerwald, the land bank's director of acquisitions and dispositions.
Now the land bank will work to find money to demolish the buildings.
“These need to come down, regardless of whether the developer goes forward. But I’ll tell you, we’re super-excited to be able to get this first-class developer. First Interstate has a great reputation. If anybody can figure it out, it’s them,” Steigerwald said.
McNair said the feasibility assessment agreement — an unusual deal structure for the city — will give First Interstate a chance to fully understand the market and gauge retailers' interest. The agreement spells out deadlines for getting appraisals, negotiating a purchase agreement, wrapping up research and identifying the need for public funding and tax credits.
“I don’t think it’s going to take too much longer for us to kind of roll up our sleeves and get started,” McNair said. “And people should be hearing more from us soon.”
But Schneider said he expects it will be a year, at least, before First Interstate has much more to say publicly.
“I know that there’s gonna be some pressure from the public side of this partnership to try to move things along more quickly,” he said.
A lot depends on how quickly the Cleveland Metroparks moves to reimagine the lakefront portion of the Euclid Creek Reservation, just down the street. The Metroparks bought the former Euclid Beach Mobile Home Community there last year and is preparing to integrate the 28.5-acre site into the surrounding green space, unifying Euclid Beach Park and Wildwood Park.
The goal is to create a nearly 150-acre lakefront park — an East Side counterpart to the popular Edgewater Park on the West Side.
“Without that public investment, I think we wouldn’t be having this conversation,” Schneider said.
He’s a board member and a former board president at the Western Reserve Land Conservancy, which purchased the struggling mobile home park in 2021 to protect it from development. After studying its options, the conservation group ultimately worked with the land bank and other organizations to close the community, help the tenants find new homes and clear the land.
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“After this project was completed with the Metroparks, I felt that we could … try to make a contribution to the neighborhood by talking with the city,” Schneider said of taking on vacant retail sites nearby.
Councilman Mike Polensek said transforming that downtrodden strip of Lakeshore is critical for the neighborhood, where there’s lots of public and philanthropic money at stake — but private investment has been scarce.
“The stars lined up, finally,” he said of striking a deal with a well-known developer.
He’s not expecting to land a Meijer or another supermarket. But there are other food retailers out there – and emerging concepts.
“I’m optimistic and very hopeful,” Polensek said. “But it’s gonna take a great deal of work. … It’s not gonna happen overnight. But finally, we see light at the end of the tunnel.”
For people who live nearby, change can’t come soon enough.
Montrez Williams is tired of looking at all the vacancies on Lakeshore.
The Family Dollar down the street recently closed. The former Walgreens is sitting empty. Across the boulevard, Dollar General is dark and boarded-up.
Williams, who was passing by Friday, used to live across the street from Dave’s. He and his neighbors relied on the store for food, money orders and other everyday essentials.
He likes the idea of new housing and retail, especially if a project includes groceries.
“As long as it’s a development to help people,” Williams said, “I’m all for it.”
Michelle Jarboe is the business growth and development reporter at News 5 Cleveland. Follow her on X @MJarboe or email her at Michelle.Jarboe@wews.com.
