In 1982, the Cleveland Foundation became the first community foundation in the country to make a program-related investment (PRI), thus ensuring that the restoration of the Playhouse Square theaters and revitalization of the theater district did not grind to a halt. The concept behind a PRI is to invest principal to advance projects that have not only socioeconomic value but also the potential to produce a reasonable return on the investment. In applying a $3.6 million PRI toward the purchase of the Bulkley and Selzer Buildings on Euclid Avenue near East 14th Street, the foundation secured the land needed for the reconstruction of the State Theatre stage house to accommodate professional ballet and opera productions at a time when the PlayhouseSquare Foundation (PSF) did not have the necessary funds to act.

While many others were pessimistic about downtown Cleveland’s future, the foundation had embraced PSF’s vision of a theater district enlivened by restaurants, hotels, shops and office buildings. The Bulkley and Selzer Buildings were central to the envisioned redevelopment of the Playhouse Square superblock. In 1986, the foundation sold property it had acquired as part of an attempt to redevelop the Bulkley complex as an enclosed shopping center. However, the sale to PSF provided the theater district with a much-needed parking lot, which ultimately became a profit center.

Finding real estate development to be feasible, PSF went on to bootstrap the financing needed to build a 205-room Wyndham Hotel at Euclid Avenue and Huron Road. The Bulkley Building, which the foundation sold for $6.1 million in 1987 to a private developer, ultimately became part of PSF’s income-producing real estate holdings. The foundation’s gap financing—a $1 million-plus loan and an agreement to hold a second mortgage of $850,000—made the building’s purchase possible in 2002.