The Port of Cleveland, at its May 14 board teleconference, approved up to $50 million in taxable lease revenue bonds for Sherwin Williams. The bonds will help the paint and coatings giant pay for costs associated with the construction of its new global headquarters in downtown Cleveland and its research and development facility in Brecksville.
Though the bonds have not yet been issued, the Port says they’re ready to go once Sherwin Williams closes on its various loans. The Port has served as a pass-through public agency and bond issuer since the mid-90s, when it issued bonds for the construction of the Rock Hall.
“This is not public money,” Jade Davis, the Port’s VP of External Affairs told Scene. “Sherwin will be on the hook for every penny.”
Davis said that using the Port as a bond issuer was attractive for companies like Sherwin pursuing major development projects because, as a public agency, the Port’s rates were lower than other lenders and its funds could be used to purchase construction materials tax-free.
“This is really a great project,” Davis said. “If you look at our charter, you’ll see that economic development is what we’re concerned with first and foremost, even more than maritime. We’ve been doing development finance like this since the mid-90s.”
The Port’s Real Estate and Finance Committee Chairman Darrell McNair agreed. “We have these two very exciting projects ahead of us and it shows that COVID-19 can’t stop good things from happening in Cleveland,” he said in a statement provided to the media.
The $50 million in bonds is of course only one piece of the elaborate financing package being assembled for Sherwin’s two projects, with an estimated $678.5 million price tag. The City of Cleveland is contributing around $100 million in tax abatements, rebates and grants.
According to Julie Young, Sherwin’s VP of Global Corporate Communications, both the downtown and Brecksville projects are still in the “early stages of construction planning.” The official groundbreaking is tentatively scheduled for the Spring of 2021, and the company isn’t expected to transition into its new headquarters until at least 2023.
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