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Cleveland: Downtown: Sherwin-Williams Headquarters

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SOP for a big company. Just recently Swagelock did the same thing, but everyone knew they weren’t leaving Solon and they quelled any angst by driving to a decision and announcement pretty quickly. Have to assume the same will happen here.  

LOL; KJP posted his update at the same time and said the same thing!

Edited by roman totale XVII
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Let's also not forget that SHW's PR department is speaking to many audiences -- not just its local employees, or Cleveland city/economic development officials, but also to those in other cities/states where it has a large presence. AND.... The PR department must also speak to its shareholders and those considering to be shareholders. Take a look what happened to SHW stock right after it made the announcement and then the market opened.

 

Within five minutes of the market opening, SHW's stock price JUMPED $20 per share -- from $527.40 to $547.83, a 4+ percent spike. It has since settled back a bit, leveling off at an $11+ increase. In other words, Wall Street loved the news about the new HQ & R&D facilities.

 

BTW, that audience also has to include the SEC, since SHW has to materially disclose a pending major capital expenditure such as a new HQ+R&D facility.

 

 

Edited by KJP
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"Life is 10% what happens to you and 90% how you respond." -- Coach Lou Holtz

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8 minutes ago, KJP said:

Made a couple of small additions to my SHW article at:

 

https://neo-trans.blogspot.com/2019/09/sherwin-williams-finally-admits-new-hq.html

I have 2 questions - 1)   when they were looking for a new HQ in 2014-15 prior to Valspar   -  Was there a press release

issued by SHW that they were looking

And  2)   when they say 2023   - Does that mean move into a new building in 2023  OR

Start building a new building in 2023

 

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18 minutes ago, KJP said:

Let's also not forget that SHW's PR department is speaking to many audiences -- not just its local employees, or Cleveland city/economic development officials, but also to those in other cities/states where it has a large presence. AND.... The PR department must also speak to its shareholders and those considering to be shareholders. Take a look what happened to SHW stock right after it made the announcement and then the market opened.

 

Within five minutes of the market opening, SHW's stock price JUMPED $20 per share -- from $527.40 to $547.83, a 4+ percent spike. It has since settled back a bit, leveling off at an $11+ increase. In other words, Wall Street loved the news about the new HQ & R&D facilities.

 

BTW, that audience also has to include the SEC, since SHW has to materially disclose a pending major capital expenditure such as a new HQ+R&D facility.

 

 

 

Wow SHW stock price is high. I was not aware. 

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On a relative basis, Cleveland has a relatively low cost of living.

 

Relocation of 4,000 employees would be a major additional company paid expense, assuming all employees would be willing to relocate to an area with a higher cost of living.

Edited by Frmr CLEder
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Stock price jump appears coincidental. Several analysts recently revised their price targets... look at the volatility in the last 30 days. Analysts and institutional shareholders drive stock price changes and they are generally not concerned with buildings. If anything, it would tend to have the opposite effect. Institutional stockholders want their companies operating as lean as possible.

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Just now, jfristik said:

Stock price jump appears coincidental. Several analysts recently revised their price targets... look at the volatility in the last 30 days. Analysts and institutional shareholders drive stock price changes and they are generally not concerned with buildings. If anything, it would tend to have the opposite effect. Institutional stockholders want their companies operating as lean as possible.

 

Although SHW made it sound like the new HQ+R&D would allow the company to operate more efficiently, which it probably would.

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"Life is 10% what happens to you and 90% how you respond." -- Coach Lou Holtz

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Not sure if anyone wants to spitball an opinion on this, but is the soil along the river, where the original HQ and current research center is located, suitable to build a skyscraper?

 

 

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Just now, punch said:

Not sure if anyone wants to spitball an opinion on this, but is the soil along the river, where the original HQ and current research center is located, suitable to build a skyscraper?

 

 

 

Any soil is probably suitable if they're going to dig caissons down to bedrock. Does your brother still work in the executive suites at SHW, @punch? 🙂


"Life is 10% what happens to you and 90% how you respond." -- Coach Lou Holtz

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He does, I haven't asked him since he told me he was not allowed to talk about it (when they tabled it a few years back)

 

My guess, the company stays in Cleveland, downtown.  What i found interesting in the announcement was the phrase "research campus"  

 

In my SIMS Cleveland, I would make the R&D buildings part of a mixed use neighborhood on Scranton Peninsula, but I could also see SW gobbling up all of the parking lots that were part of the proposed Amazon footprint with some low rise buildings and a skyscraper. 

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Interesting line here, don't know if it's been overlooked or not. https://www.cleveland.com/news/2019/09/sherwin-williams-looking-for-new-headquarters-company-confirms.html

From the Cleveland.com article, McCormack was quoted as saying:

 

“Obviously, it’s clear they need more space. It’s clear they need a better home,” said McCormack. “I think we definitely have it downtown. We have the ability to accommodate that. Beyond the spatial needs that are clear, and a more cohesive home for them, [Sherwin-Williams has] not expressed anything else” about incentives from the city.

 

I know it's early, but it does make me wonder how much in incentives, if any, the company will ask for. I guess how much they do end up asking for will show their level of commitment to the city.

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The costs to move to NYC or LA would be too huge. I don't see how that could benefit the company.

I work in software development, and the average salary in NYC/LA is over 50% more than it is here in Cleveland.

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On 9/6/2019 at 4:09 PM, Terdolph said:

The Justice center is fine where it is. 

 

It will be renovated. 

 

Remember, you heard it from Terdolph first.

The Justice center is beyond renovation.  I don't think people appreciate how dilapidated and unsalvageable that place is.

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Well guys:

 

Just talked to someone I trust - in order for SW to leave downtown, let alone NEO, the following two things would both have to happen:

 

1. Cleveland would have to refuse to provide a reasonable tax incentive - at least inasmuch as it would offset the costs of relocating operations. 

 

2. (In sum, 30,000 foot view) A competing city would have to foot the bill for relocation costs to where the incentives would offset the costs associated with the logistics in under 5 years. 

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5 minutes ago, YABO713 said:

Well guys:

 

Just talked to someone I trust - in order for SW to leave downtown, let alone NEO, the following two things would both have to happen:

 

1. Cleveland would have to refuse to provide a reasonable tax incentive - at least inasmuch as it would offset the costs of relocating operations. 

 

2. (In sum, 30,000 foot view) A competing city would have to foot the bill for relocation costs to where the incentives would offset the costs associated with the logistics in under 5 years. 

 

I feel the definition of reasonable could be very skewed here, especially when dealing with a massive Fortune 500 company that is essentially attractive for any major city to acquire. 

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6 minutes ago, YABO713 said:

Well guys:

 

Just talked to someone I trust - in order for SW to leave downtown, let alone NEO, the following two things would both have to happen:

 

1. Cleveland would have to refuse to provide a reasonable tax incentive - at least inasmuch as it would offset the costs of relocating operations. 

 

2. (In sum, 30,000 foot view) A competing city would have to foot the bill for relocation costs to where the incentives would offset the costs associated with the logistics in under 5 years. 

Cleveland usually gives large commercial developments 30-year non school TIFs.  I do not see this being any different. 

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8 minutes ago, YABO713 said:

Well guys:

 

Just talked to someone I trust - in order for SW to leave downtown, let alone NEO, the following two things would both have to happen:

 

1. Cleveland would have to refuse to provide a reasonable tax incentive - at least inasmuch as it would offset the costs of relocating operations. 

 

2. (In sum, 30,000 foot view) A competing city would have to foot the bill for relocation costs to where the incentives would offset the costs associated with the logistics in under 5 years. 

 

That makes me wonder...

 

I know Sherwin-Williams is one of the largest paint companies in the world. But I wonder, how much would other cities actually be willing to go to to land them? 

I get why everyone was going after Amazon, but that was a long shot for almost all cities. And just look at how much SHW is worth compared to Amazon: Amazon's current stock is $1,849 per share, while Sherwin-Williams's is less than one-third that, at 540$. 

 

I'm not saying SHW is not a large asset to the city's economy (it's crucial for CLE), but essentially, I'm asking if Sherwin-Williams is truly major enough to warrant other cities actively looking to steal them from NEO and pay the costs/deal with all of the economics of what YABO713 describes above. I would love some more insight into this.

 

Maybe my argument/questions are completely bogus, I don't know...

Edited by Geowizical

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9 minutes ago, YABO713 said:

Well guys:

 

Just talked to someone I trust - in order for SW to leave downtown, let alone NEO, the following two things would both have to happen:

 

1. Cleveland would have to refuse to provide a reasonable tax incentive - at least inasmuch as it would offset the costs of relocating operations. 

 

2. (In sum, 30,000 foot view) A competing city would have to foot the bill for relocation costs to where the incentives would offset the costs associated with the logistics in under 5 years. 

 

Given that Columbus was a finalist for Amazon HQ2, I wonder if they could repackage (and trim down) the incentives they pulled together for Amazon to try to lure SW. This would be a HUGE addition for the city, and I'm sure if they have legit opportunity they will be working head over heals to make it happen. 

 

With that being said, I think it will likely be tough for anyone to lure SW away from downtown Cleveland.

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3 minutes ago, cbussoccer said:

 

Given that Columbus was a finalist for Amazon HQ2, I wonder if they could repackage (and trim down) the incentives they pulled together for Amazon to try to lure SW. This would be a HUGE addition for the city, and I'm sure if they have legit opportunity they will be working head over heals to make it happen. 

 

With that being said, I think it will likely be tough for anyone to lure SW away from downtown Cleveland.

5 hours ago, Florida Guy said:

"As part of the exploratory process, Sherwin-Williams will consider multiple potential sites, including locations in Cleveland, Northeast Ohio and several other states." 

Columbus is not in NE Ohio, Cleveland, or another state. 

 

Again, they are only looking at Cleveland, Northeast Ohio, and Other States...

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10 minutes ago, Geowizical said:

 

That makes me wonder...

 

I know Sherwin-Williams is one of the largest paint companies in the world. But I wonder, how much would other cities actually be willing to go to to land them? 

I get why everyone was going after Amazon, but that was a long shot for almost all cities. And just look at how much SHW is worth compared to Amazon: Amazon's current stock is $1,849 per share, while Sherwin-Williams's is less than one-third that, at 540$. 

 

I'm not saying SHW is not a large asset to the city's economy (it's crucial for CLE), but essentially, I'm asking if Sherwin-Williams is truly major enough to warrant other cities actively looking to steal them from NEO and pay the costs/deal with all of the economics of what YABO713 describes above. I would love some more insight into this.

 

Maybe my argument/questions are completely bogus, I don't know...

Don't mean to jump in just to correct you, but stock price is irrelevant.  Market cap is.  

 

SHW is $540 a share and has a $50B market cap, whereas MSFT is $138 a share  but has a market cap of $1.05 Trillion. (about $1T more than SHW)

 

My gut instinct says they stay in downtown CLE and invests heavily.  It'll be a bigger story than when #23 returned in 2014. 

Edited by RE Developer In Training
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2 minutes ago, Geowizical said:

 

Again, they are only looking at Cleveland, Northeast Ohio, and Other States...

 

So if Columbus gives them a sweetheart deal they won't take it?

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7 minutes ago, cbussoccer said:

 

So if Columbus gives them a sweetheart deal they won't take it?

They are just trying to get state incentives.  Moving to Columbus will not help them in that regard. 

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16 minutes ago, cbussoccer said:

 

So if Columbus gives them a sweetheart deal they won't take it?

 

Yeah I really think other Ohio metros are pretty much non-starters. But I've been wrong before. 

 

If SHW jumps ship it's going to a boomtown, imo. 

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We must not overlook the human capital costs; costs associated with relocating 4000+ employees away from Cleveland AND the "brain drain" as a result of those who elect to stay put in NEO.

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2 hours ago, tastybunns said:

So after the press release, the CEO sent out another reminder email to all their employees to keep their mouths shut if they had any more info. One of my buddies in the financial dep. actually has no idea about any of the details, and everyone's just going apesh*t in their offices trying to figure this out. The only thing that he does say is that there is a new building involved, but he doesn't know where it is but i told him some addl' info so that way he can spread the word.

 

 

Screenshot_20190912-094815-1.png

 

2 hours ago, Geowizical said:

^Big blunder, SHW. Not sending this release out to employees with the foresight to see this "chaos" happening and letting rumors and intrigue run rampant? Crazy to hear all of this confirmed coming from the inside...

If enough people at SHW now are "going crazy" about their future prospects and what'll happen to them/their jobs in four or so years, then I say the ball is definitely in SHW's court. 

How they react to a) the media possibly pushing the narrative that they are leaving NEO altogether and b) the general public pushing the narrative that it would kill the metaphorical heart of the city if they left, will be very interesting to see...

Like I said before, in the days to come SW is going to regret releasing this "no news news relase".

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8 minutes ago, Frmr CLEder said:

We must not overlook the human capital costs; costs associated with relocating 4000+ employees away from Cleveland AND the "brain drain" as a result of those who elect to stay put in NEO.

 

I guess moving to Mexico would solve some of those costs

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3 hours ago, John D. Baumgardner said:

Check out this informational video produced by Sherwin-Williams. It provides a historical timeline of what has been a very transformative and very successful corporation.

 

Cleveland and other local officials BEST NOT drop the ball on this matter ... Losing a corporate giant like this would be a death blow to the city all the way around.

 

 

You seem very worked up about the news release.  Last week you said you were having lunch with the emperor of Cleveland who knew everybody and everything and they were 100 per cent going to build on the Nucleus lot.  What is the emperor saying?

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In my head, I keep coming back to this beauty.  For those that don't remember, this replaced the Lebron banner after his heartbreak departure in 2010.  They aren't going anywhere.

1737044323_ClevelandSherwinWilliamsBannerOurPrideForever.thumb.jpg.9bb3294f33c1ff2594ef21edcc398b4e.jpg

Edited by West153
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From Cleveland.com:

"Mayor Frank Jackson’s press office did not respond to a request for comment."

 

After being rumored for years, why is it that the Mayor's Office has no response on such an important issue?  They should have had a statement prepared and been all over this like City Council and other civic leaders.

Edited by Frmr CLEder
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^^ Agreed. I feel like they have way too much hometown pride to just up and leave. Hopefully way too much pride that results in building a massively tall skyscraper to make a statement. 😉

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Just now, Frmr CLEder said:

From Cleveland.com:

"Mayor Frank Jackson’s press office did not respond to a request for comment."

 

Why is it that the Mayor's Office has no response on such an important issue, that has been rumored for years?  They should have been all over this like City Council.

pathetic

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32 minutes ago, West153 said:

In my head, I keep coming back to this beauty.  For those that don't remember, this replaced the Lebron banner after his heartbreak departure in 2010.  They aren't going anywhere.

1737044323_ClevelandSherwinWilliamsBannerOurPrideForever.thumb.jpg.9bb3294f33c1ff2594ef21edcc398b4e.jpg

A new SW HQ on PS would fit beautifully into this picture, nudged between Lou Stokes Court Tower & Terminal Tower.

Edited by Frmr CLEder
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2 hours ago, West153 said:

In my head, I keep coming back to this beauty.  For those that don't remember, this replaced the Lebron banner after his heartbreak departure in 2010.  They aren't going anywhere.

1737044323_ClevelandSherwinWilliamsBannerOurPrideForever.thumb.jpg.9bb3294f33c1ff2594ef21edcc398b4e.jpg

They could make this stuff while they're in the suburbs. Suburbanites are cheerleaders all the time but would never call Cleveland proper their home.

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SW doesn't want to be in the suburbs.  In 2019, all the evidence points to the fact that Millennials and Gen Zs generally want to live/ work/ play in the city.  Moving to Brecksville or where ever would put them at a serious competitive disadvantage from a talent acquisition standpoint.  These are smart people; it won't happen.

Edited by West153
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I know they're going to stay in Cleveland, but because Cleveland dropped the Amazon package a few months back they're a bit jealous so they're threatening, but it's all in the head. Do not let these news articles get under your skin. They're literally this close to modeling.

Edited by tastybunns
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I found this part in one of the cleveland.com articles to be informative (https://www.cleveland.com/metro/2019/09/history-of-sherwin-williams-and-cleveland-has-been-intertwined-for-153-years.html)

 

Company leaders have been community leaders, too. Ninety-seven employees are now on 111 area nonprofit boards. 

 

Cleveland is home for Sherwin Williams and many of its leaders.  Based on this and all the other things that have already been discussed and discovered, I just cannot fathom them leaving the region.

Edited by cle_guy90
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13 hours ago, marty15 said:

How many employees did BP have here when they left for Chicago?

 

One of the town's leading corporate citizens, British Petroleum PLC, plans to buy Amoco Corp. in a deal valued at about $54 billion and move its North American headquarters to Chicago, sacking about 1,000 BP employees in Cleveland in the process.

 

In the mid-1980s, the company's North American headquarters had about 5,500 employees and filled every working floor of its hulking, 45-story, red granite-clad tower. 

 

But layoffs and the transfer of employees to London, New York and Houston, where the U.S. oil industry is unofficially headquartered, cut the workforce to about 1,000, taking up 10 floors of the building, according to BP officials.

 

SOURCE:

https://www.chicagotribune.com/news/ct-xpm-1998-08-16-9808160403-story.html

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"Life is 10% what happens to you and 90% how you respond." -- Coach Lou Holtz

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Why is every news station just feeding lie after lie about this deal. I've seen nothing but news on SW saying they're leaving for good... It's actually pissing me off, because any idiotbox news channel has a way to make things sound way worse than things are, and its every single one of them. This makes things a whole lot harder. Now I sort of understand why they were so tight lipped about it, but I do know for a fact that they're not looking anywhere else but Cleveland.

 

They're just jealous about the whole Amazon deal, but like it or not whatever the city would do to call their bluff, they're staying for good. There wasn't any reason for Progressive to leave, so why should SW. They're not capable of making a long distance move right after acquisition & merger of Valspar, it would take way more than 4 years to accumulate the amount of capital to pack up shop. Believe me, I have insiders in the financial division at SW. They're saying that a move would take away the majority of funding for the new buildings, and there's absolutely no reason to move.

 

To absorb is one thing, but to absorb and move, now you're talking about money wasted you're not about to have. There's no place like home where property values are some of the lowest in the country, but with quite valuable space too. They picked a good city to start in, and it's the best in their interests to stay in. Why waste so much money.

 

Edits: formatting issues

Edited by tastybunns
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3 hours ago, KJP said:

 

One of the town's leading corporate citizens, British Petroleum PLC, plans to buy Amoco Corp. in a deal valued at about $54 billion and move its North American headquarters to Chicago, sacking about 1,000 BP employees in Cleveland in the process.

 

In the mid-1980s, the company's North American headquarters had about 5,500 employees and filled every working floor of its hulking, 45-story, red granite-clad tower. 

 

But layoffs and the transfer of employees to London, New York and Houston, where the U.S. oil industry is unofficially headquartered, cut the workforce to about 1,000, taking up 10 floors of the building, according to BP officials.

 

SOURCE:

https://www.chicagotribune.com/news/ct-xpm-1998-08-16-9808160403-story.html

 

...and I haven't rolled into a BP gas station since this was announced.

 

Horton abandoned Cleveland to line his pockets.

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Yeah our local media is failing us. I’ve received over a half dozen texts asking me why SHW is leaving, with links from local channels....

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Not sure if anyone has any other recent examples, but it appears ConAgra moving to Chicago led to a decline of more than 50% of their Omaha workforce. 

https://www.omaha.com/money/after-agonizing-debate-conagra-moving-hq-to-chicago-cutting-omaha/article_40ef4148-6798-11e5-8f93-9bea8a0abeb2.html

 

that said, anyone have thoughts about our skills? Sure we don’t have a UT-Austin or OSU, but this neck of the woods is home to PPG, Akzo Nobel, Ferro, RPM, etc. that’s a lot of coatings talent to poach from. Wouldn’t moving to a Chicago or Charlotte take away that ripe recruiting base?

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4 minutes ago, YABO713 said:

Yeah our local media is failing us. I’ve received over a half dozen texts asking me why SHW is leaving, with links from local channels....

It hasn't even been 24 hours but maybe those "geniuses"  who drafted and approved that idiot press release should finally admit the way it was presented has turned into a negative for the company;s reputation in town (unless they are enjoying all the press BS which should have been anticipated) and issue a clarification.

 

It is really hilarious that they thought they were nipping something in the bud and ending speculation by issuing that news release and all it has done is cause hysteria and fostered even more crazy speculation.

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IMHO, the worst thing about the SW news is that community boosters and civic leaders are stuck having to play defense in keeping SW in Cleveland and won't be able to play offense in bringing other HQs here.

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21 minutes ago, Htsguy said:

It hasn't even been 24 hours but maybe those "geniuses"  who drafted and approved that idiot press release should finally admit the way it was presented has turned into a negative for the company;s reputation in town (unless they are enjoying all the press BS which should have been anticipated) and issue a clarification.

 

It is really hilarious that they thought they were nipping something in the bud and ending speculation by issuing that news release and all it has done is cause hysteria and fostered even more crazy speculation.

 

If SW is truly considering all their options for their new HQ, including leaving Cleveland and the state completely then I'm not entirely sure what is wrong with that letter drafted by SW?

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