The Economic Impact of the
Catalytic Redevelopment of
the May Company Building
August 20, 2015
Levin Research Conference
Candi Clouse, MSUS
Center for Economic Development
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History of May Company
• Opened in 1915 on Cleveland’s Public
Square
• 800,000 square feet of floor space with a
later expansion to over one million
• Built by Daniel Burnham reflecting city
beautiful movement
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History of May Company
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Dozens of retail departments
City’s largest soda fountain
Auditorium
Hair salon
Children’s area
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History of May Company
• At the height, it employed 2,500 people
• Placed on the National Register of Historic
Places in 1974
• Closed in 1992 after being bought out by
Kaufman’s (now Macy’s)
• Since the closing of the department store,
the first floor has had varied occupants and
some upper floors housed a data center
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Public Square Today
• Horseshoe Casino
• Situated between the East 4th Street &
Warehouse Entertainment Districts
• $30 million renovation of Public Square
• $1.6 billion in new and renovated
construction surrounding Public Square
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The Pink Elephant in the Room
• May Company has been called “a huge
blight on Public Square”
• $128 million renovation and conversion
– 353 Apartments
– 387 Parking spaces
• Project was already awarded a $5 million
Ohio Historic Preservation Tax Credit
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Catalytic Certificate
• In June, 2014, Ohio Governor John Kasich signed
legislation allowing for one project in each two-year
budget to receive a Historic Preservation Tax Credit
worth $25 million
– Cap has been $5 million
– $25 million would be spread over five years
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Economic Impact Defined
• An analytical approach used to estimate economic
benefits from projects or programs on affected
regions
• Economic benefits determined by spending patterns,
investments, and job creation
• Economic benefits are measured in terms of output,
value added, jobs, household earnings, and taxes
• Measured benefits for a specific region and time
period
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Economic Impact Defined
• Employment Impact
– Number of jobs created
• Labor Income Impact
– Payroll paid to employees plus proprietors’ income
• Output Impact
– Total value of goods and services produced
• Value Added Impact
– Value of goods and services less the intermediary goods and
represents a portion of output (GDP)
• Tax Impact
– Federal, state, and local tax revenues
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Economic Impact Defined
• Direct Impact
– The initial value of goods and services the organization
purchases locally
• Indirect Impact
– Jobs and production needed to produce goods and
services required by organization
• Induced Impact
– Change in local households spending due to increased
earnings
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Economic Impact Defined
Direct
Indirect
Total
Economic
Impact
Induced
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Economic Impact Data
• Construction costs over two years at a cost of $128
million
• Operation of the apartment building over the first
five years at a cost of $39 million
– Apartments
– First floor retail
• Catalyzed projects construction and operation
– Vacant sites and spaces within 2,500 square feet of the
project
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Development
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Economic Impact
Type of
Employment
Impact
Direct
Indirect
Induced
Total
50,427
13,021
13,877
77,325
Labor
Income
$2.2 B
$0.7 B
$0.7 B
$3.6 B
Output
Value Added
$5.8 B
$1.2 B
$1.2 B
$8.2 B
$8.3 B
$1.8 B
$1.8 B
$12.0 B
Taxes
$572 M
$82 M
$75 M
$730 M
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First Round
Competition
Huntington Building
Cleveland
Former Goodyear HQ
Akron
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First Round
Competition
Music Hall
Cincinnati
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The Future
• In 2015, the state of Ohio has decided to hold an
early competition for the next biennium award of the
Catalytic Certificate which would move the process
ahead 6 months
• The May Company Development team will reapply
next month
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The Economic Impact of
the Catalytic
Redevelopment of the
May Company Building
Candi Clouse, MSUS
Program Manager
Center for Economic Development
Levin College of Urban Affairs
Cleveland State University
Cleveland, Ohio
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