Key Tower returns to local ownership, with $267.5 million sale to Millennia Companies

We congratulate our client, Millennia Companies, on their recent acquisition of the Key Tower in Cleveland.

Published by: Michelle Jarobe/The Plain Dealer
Published date: February 2017

The Buckeye State’s tallest building is back in local hands.

Tuesday, the Millennia Companies of Valley View bought the 57-story Key Tower office building and an attached hotel and parking garage. The $267.5 million acquisition was a colossal commercial real estate deal for Greater Cleveland. And the purchase was a coup for Millennia, a privately held family of companies focused on the apartment business.

“That’s a mammoth transaction,” said Alec Pacella, managing partner at the NAI Daus brokerage in Beachwood. “To think a local buyer’s behind that, pulling the strings – especially a local buyer who’s not on the radar screen, when you think about office buyers – that’s pretty amazing. Pretty amazing. That’s real estate, right? Never a dull moment. Always a surprise.”

Now Millennia controls a 1.3-million-square-foot office complex, a 400-room Marriott hotel and nearly 1,000 parking spaces in an underground garage. And the new owner plans to make significant investments, to upgrade public spaces and ready office floors for new tenants.

Millennia expects to move its headquarters and hundreds of employees from Rockside Road to Key Tower this year. And all signs point to Forest City Realty Trust, Inc., a publicly traded real estate company now based in Terminal Tower, following suit in 2018.

Those leases – totaling 193,000 square feet – will tip occupancy at the office tower over 95 percent. Forest City hasn’t publicly announced its moving plans. Millennia alluded to the increased occupancy in a news release late Tuesday but didn’t provide details about incoming tenants.

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