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CSU plans $45M center for health care focus
Three ticket brokers sue Cleveland over tax City applies admissions legislation inconsistently, companies say in filing
Students will work more closely with peers at former NEOUCOM
By JOEL HAMMOND jmhammond@crain.com
The city of Cleveland’s fight to collect on overdue admissions taxes again is rearing its head, only this time outside of the city’s small music venues. Mayfield Village ticket broker Amazing Tickets Inc., Twinsburg’s Affordable Ticket Agency Inc. and Denver Ticket Co. have filed suit jointly in U.S. District Court in Cleveland over what they call an “unconstitutional tax on innocent” parties and alleged violations of their constitutional rights to due process. The admissions tax came under scrutiny last summer when the city began asking small concert venues to start paying an 8% tax on ticket sales, as long called for under Cleveland’s administrative code. The tax under that specific portion of Chapter 195 of the city’s code is to be paid by venues, which have the choice to pass along that fee to their customers. The Beachland Ballroom at that point owed $400,000 in back admissions taxes. In February, Crain’s reported on a plan proposed by Cleveland Mayor Frank Jackson, under whose direction the city stepped up efforts to collect admissions taxes, that would offer venues with capacities of 500 or fewer people varying breaks on the 8% tax levied on total ticket sales. Seventy-five percent of ticket sales by venues holding 250 or fewer people would be exempt from the city’s admissions tax, with the rest taxed at the 8% rate. Similarly, venues holding between 250 and 500 people would receive a 50% exemption. Yet, according to the lawsuit filed April 5 by the three ticket brokers, the city is trying to extend the admissions tax to a whole new portion of ticket revenue. In March 2011, the city subpoenaed the three named plaintiffs, seeking 8% of their revenues from
17
See BROKERS Page 18
By TIMOTHY MAGAW tmagaw@crain.com
STEVE BENNETT ILLUSTRATION
FAST TO THE FARM Financial advisers pitch themselves to property owners who, sitting on shale gas, suddenly are in the catbird’s seat By MICHELLE PARK mpark@crain.com
B
rent Laner sees the tug-of-war playing out on billboards and in newspaper ads. “We’re the best. We know what to do,” the battling ads declare. A landowner in Tuscarawas “Especially in this part of County, Mr. Laner is witness to the effort by bankers and Ohio ... these are people financial planners to position who have struggled for themselves as the place to turn years.” for farmers and other property owners who are reaping sud– Denise Penz, executive vice den wealth as energy compapresident, COO and wealth nies buy the mineral rights to manager, Premier Bank & Trust their land in the hydrocarbonrich Utica shale region of eastern Ohio. Banks and wealth management firms big and small are hosting seminars, sending direct mailers and even meeting one-on-one
Cleveland State University is laying the groundwork to take on $71 million in new debt, a hefty chunk of which is expected to finance the construction of a building devoted to health care careers. The roughly $45 million Center for Health Professions, as it’s been named, is still in the conceptual stages, but Cleveland State president Ronald Berkman characterized it as one of the “most important” pieces in his vision for growing the urban university. “When I came, I said health care needed to be one of the core strategic areas of the university,” Dr. Berkman said in an interview last Friday, April 20. “As an urban university, we need to form academic programs around the work force opportunities for students and where we can make contributions toward the economic Berkman development of the city.” The new building would be located at the site of the soon-to-be demolished Viking Hall on Euclid Avenue. It would be, in part, the physical manifestation of the university’s burgeoning relationship with Northeast Ohio Medical University, or NEOMED, the medical school in Rootstown formerly known as NEOUCOM. NEOMED plans to contribute as much as $10 million toward the new center, which will serve as a space for Cleveland State students majoring in health careers — such as physical and occupational therapy, social work and nursing — to collaborate with medical students from NEOMED. Also, by 2013, as many as 35 Cleveland See CSU Page 17
INSIDE Shale boom helps counties get land records digitized Gas drillers are offering to make many Eastern Ohio counties’ land records electronic, and it’s not a cheap process, at $100,000 to $300,000 a pop. PAGE 4 PLUS: Experts debate whether exporting natural gas to other nations is the best path to take. PAGE 3
See FARM Page 7
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NEWSPAPER
74470 83781
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SPECIAL SECTION
WHO TO
WATCH FINANCE IN
Read about some of the industry’s brightest and the challenges they will face ■ Pages 11-15
Entire contents © 2012 by Crain Communications Inc. Vol. 33, No. 17
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Almost all private-sector workers who are offered life insurance benefits by their employers take the companies up on the offers, according to government data collected in March 2011. The data showed that 58% of private industry workers were offered life insurance benefits, and 97% enrolled in them. As you might expect, there’s a huge gap between access full-time workers have to the benefit compared with part-timers. Here’s how the data break down:
Legal Affairs Summer associate programs at some law firms took a hit during the recession; have they rebounded? We analyze in our periodic legal section. Plus, a look at work policies on driving and cell phone use.
Employer group
March 2012
% offered life insurance benefit
Take-up rate
Participation rate
58%
97%
56%
Full-time workers
73
97
71
Part-time workers
14
91
13
All private-sector workers
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Little HQ input upsets county council reps Republicans: FitzGerald team didn’t seek their real estate ideas By JAY MILLER jmiller@crain.com
It only may be a sign of politicians beginning to understand how to push the levers of government, but two minority party members of Cuyahoga County Council are questioning the way the FitzGerald administration is going about finding
a new home for the county’s headquarters. At an April 3 meeting of an ad hoc council committee created to look at the county’s real estate needs, Republican councilmen Michael Gallagher and David Greenspan became displeased at what they were hearing about the process the county was implementing to sell
some of its properties and consolidate the county’s offices. After presentations from county law director Majeed Makhlouf and public works director Bonnie Teeuwen, Mr. Gallagher asked, “Who decided not to build?” Mr. Greenspan then said he wanted the council to be more involved in this real estate process.
Both said later that they were responding to their feeling that the administration of County Executive Ed FitzGerald, a Democrat, wasn’t consulting sufficiently with council. They also said the administration wasn’t keeping council informed of plans for selling properties and consolidating scattered county offices into a central headquarters. Mr. Gallagher, who represents the southwestern suburbs around Strongsville, said when he has
THE WEEK IN QUOTES
brought up the idea of constructing a new county headquarters building, he was told that the idea has been dismissed. “Well, if we’re part of the process, I don’t recall dismissing it,” he said. “I think it’s a good question. “I just want to hear the negatives about building new” before moving ahead on any course of action, Mr. Gallagher said. See COUNCIL Page 16
INSIGHT
Exporting natural gas could buoy Ohio players
“All of a sudden, now you’ve got any number of these large corporations knocking on your door. This is a windfall that may only happen once to these people, and they want good advice.”
Such a move would raise prices, bringing more for landowners’ leases
— Matthew M. Pullar, senior relationship manager for PNC Wealth Management in the Cleveland market. Page One
By DAN SHINGLER dshingler@crain.com
“The mission of our college is to develop responsible and competent business leaders.We’ve always had leadership activities through our coursework, but for the first time we’re giving students experiential leadership development activities.” — Ravi Krovi, dean of the University of Akron’s College of Business Administration. Page 4
“When I did consulting work, I was in a lot of different places. I saw that you can do a lot more as a leader of a small organization … things you might not be able to do at a large institution.” — Christine Blake, CEO, Cardinal Community Credit Union. Page 11
“New York was cool, but New York with three kids was not cool.” — Kevin White, director, Western Reserve Partners LLC. Page 14
STEPHEN HERRON PHOTOS
ABOVE: Rick Pollack shows off one of MakerGear LLC’s 3-D printers at Shaker LaunchHouse, a business accelerator where he sometimes works. BELOW: A “tornado,” printed for display purposes, sits inside the machine.
THE PEOPLE’S PRINTER MakerGear creates less expensive 3-D printers designed to bring manufacturing to individuals, schools, small businesses By CHUCK SODER csoder@crain.com
R
ick Pollack’s 3-D printers are multiplying. At his home in Shaker Heights, four small 3-D printers he developed run around the clock churning out plastic parts for — that’s right — more 3-D printers. He and his five colleagues at MakerGear LLC need to keep those printers busy. The people who consider themselves part of the growing “maker” movement are looking for cheap, fast ways to make tools, toys and prototypes. Hence the demand for the company’s printers, which cost between $800 and $1,500. Orders for the 3-D printers keep coming, even though the
3-year-old company has done almost no marketing. “We can’t keep up with demand,” Mr. Pollack said. Three-dimensional printers, which can create parts in almost any shape by printing thin layers of material on top of each other, have been around since the mid-1980s. In the past, however, buying one meant spending tens of thousands of See MAKERS Page 6
Construction of the first liquefied natural gas export plant in the lower 48 states likely will begin this spring, kicking off a debate over whether to build more LNG installations to help sell the United States’ newfound natural gas riches to other nations. Exporting the natural gas from Ohio’s shale fields could lead to higher natural gas prices at home for consumers and businesses, though that outcome might be good for Ohio as the state enters its natural gas boom. It would mean more money for Ohio landowners and others who own mineral rights in the state. It also would support faster extraction of Ohio’s natural gas and accelerate the creation of a robust energy industry in the state, drilling proponents say. “If we don’t have a market for the gas, it won’t happen with the strength that needs to be there,” said John Miller, a former stockbroker who got into the oil and gas business working for production companies in the 1990s. He’s now working to build a company in Marietta to help Ohio’s drillers dispose of used fluids. “We need gas prices somewhere in the $5 to $8 range,” and enabling exports would help get the price to that level, Mr. Miller said. Mr. Miller is talking about the price of a thousand cubic feet of gas, or an MCF — the magic number for producers, royalty payment recipients, tax collectors and just about anyone else whose living is made from what is sold at the wellhead when gas is produced. Natural gas sold for $5 or more per MCF from 2004 to 2009, including two occasions during that time when it temporarily rose above $10 per MCF. Recently, though, all the gas coming out of Pennsylvania, western states and, more recently, Ohio, has caused gas prices to plummet. They See EXPORTS Page 9
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Driller foots bill to digitize county data Electronic land info eases deal process By CHUCK SODER csoder@crain.com
Harrison County Recorder Tracy Boyer never expected a private company one day would foot the bill to digitize all the land records in her office. “Never, ever, ever,” she said. That, however, was before representatives of oil and gas companies started to overrun her office. One of those companies, Chesapeake Energy Corp., has agreed to digitize land records in at least five eastern Ohio counties, Harrison included, and has made a similar offer to Mahoning County, according to various county recorders. Their estimates as to how much the Oklahoma City-based oil and gas company would pay range from $100,000 to $300,000 per county. So, why would a private company spend money on projects that normally would be paid for by the public? Because Chesapeake wants easy, fast access to the records. The company has spent $2.3 billion to secure rights to natural gas and other valuable hydrocarbons trapped beneath the Utica shale, a rock formation located deep below most of eastern Ohio. Almost all of that money was spent on leases in Ohio. Before Chesapeake can do deals, however, the company must study county land records. Thus, employees from Chesapeake and its competitors have been packing recorders’ offices throughout eastern Ohio, combing through thousands of documents. Many documents are available only in paper form, and some are more than 100 years old. Demand for records in Harrison
County has skyrocketed over the past two years or so, Ms. Boyer said. It isn’t uncommon for 45 or 50 people to be checking records in the office each day, she said. Ms. Boyer said the availability of digital records will help get them out the door faster and lessen the burden on her staff, which consists of herself, two full-time employees and four part-time employees brought on to handle all the new business. Part-time employees could be laid off as demand falls, she noted. The deal with Chesapeake also will help the county preserve its paper records, which have taken a beating lately. “They’re falling apart,” she said. “Now these records are fully secure. We could never afford to do that.”
Not on the ‘net yet Harrison County expects that, by early fall, people should be able to access digital records from the recorder’s office but not via the Internet. The county aims to put its documents online eventually, but it first will need to remove Social Security numbers and find money to cover fees its vendor would charge to host the images online, Ms. Boyer said. Other county recorders made similar comments. “That will be a big process,” Ms. Boyer said. That vendor, ACS Corp. of Dallas, negotiated a deal whereby Chesapeake paid the company to digitize land records in four counties: Harrison, Tuscarawas, Belmont and Carroll. Chesapeake media relations manager Pete Kenworthy confirmed the company also is paying to digi-
tize land records for Columbiana County, which is located just south of Mahoning County. The digital records will “help alleviate some of the current crowding problems at the courthouse as the review of records could be done remotely,” said Mr. Kenworthy, who described the cost incurred as “significant.” Mr. Kenworthy said Chesapeake is considering similar deals “in other Ohio counties where we are, or plan to be, active,” but would not comment further. Xerox Corp., which owns ACS, would not comment for this story. Chesapeake last December offered to pay ACS to digitize Mahoning County’s land records, said Mahoning County Recorder Noralynn Palermo. The county’s land records that predate 1985 are available only in paper form, she said. Ms. Palermo said she passed the digitizing contract along to the county prosecutor’s office, which has yet to give her legal approval to go ahead with the contract. If she wins that approval, Ms. Palermo said, she’s inclined to let Chesapeake and ACS digitize the records.
Long-term benefit It’s unclear whether any other oil and gas companies have offered other counties similar deals. However, a group of land owners is paying $254,000 to digitize land records in Trumbull County. The Associated Landowners of the Ohio Valley chose to digitize the records because its members own a lot of land in the county, said Bob Rea, director of the group. The organization is planning to lease 85,000 acres in Trumbull County to oil giant BP p.l.c. of London, which has agreed to pay members $3,900 per acre, or $331.5 million in total, plus royalties. Digitizing the records will allow the group to speed up the process of transferring titles and getting their money, Mr. Rea said. And there will be side benefits for anyone who wants to access the records in the future, he said. “The people of Trumbull County are going to be benefiting for a long time,” he said. ■
Smucker, UA team to train next leaders By TIMOTHY MAGAW tmagaw@crain.com
J.M. Smucker Co. will donate a total of $1 million over the next four years to the University of Akron to establish an institute aimed at cultivating the next generation of business leaders. The program, called the Institute for Leadership Advancement, formally launches next fall and will be housed in the university’s College of Business Administration. “We would rather not put money into bricks and mortar, but (would rather) think about how to support a program that helps the university produce students with stronger leadership capabilities based on what businesses need today,” said Barry Dunaway, senior vice president and chief administrative officer at the Orrville-based food manufacturer. While leadership always has been a component of the college’s business curriculum, the new insti-
tute is expected to put a greater focus on leadership training within the college through new team development and networking activities, said Ravi Krovi, dean of the University of Akron’s College of Business Administration. “The mission of our college is to develop responsible and competent business leaders,” Dr. Krovi said. “We’ve always had leadership activities through our coursework, but for the first time we’re giving students experiential leadership development activities.” Activities within the institute will be a combination of for-credit and not-for-credit programming, including coursework and campuswide forums and workshops. The institute also will identify top-performing honors students and put them on a special course sequence that focuses on leadership. The leadership institute is expected be a pillar of the university’s recently revamped College of Busi-
ness Administration, according to Dr. Krovi. The university overhauled its business curriculum with the help of more than 200 business leaders who serve on the college’s professional advisory board. “There’s a need for a different breed of student,” Dr. Krovi said. Smucker and the University of Akron have a longstanding relationship. For one, Paul H. Smucker, the company’s former chairman, was involved in the founding of Wayne College, a branch campus of the University of Akron. Also, the University of Akron is one of the company’s top feeder schools and four of the company’s top executives, including Mr. Dunaway, are alums. “They have continued to produce graduates who are skilled but also who have a good, strong work ethic,” Mr. Dunaway said. “We continue to see students come out of the University of Akron with that great work ethic and strong values that fit within our company.” ■
Volume 33, Number 17 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of May and fifth week of May, the fourth week of June and first week of July, the third week of December and fourth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright © 2012 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877-8249373. REPRINT INFORMATION: 800-290-5460 Ext. 136
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Portland leaders to visit Cleveland, study region’s progress Proposal deems us ‘an innovative city’ collaborating on business attraction By JAY MILLER jmiller@crain.com
Business and civic leaders from Portland, Ore., looking for better ways to build their region’s economy are coming to Northeast Ohio to learn how the region is building its economy. The group of 60 Portlandians will arrive here late Tuesday afternoon, April 24, and stay until Friday about noon. The group will receive the “Full Cleveland� experience, checking out how Northeast Ohio is restructuring its economy and working collaboratively on business development. Why Cleveland? “Cleveland is an innovative city that fosters entrepreneurship and has developed a network of partners to develop and excel in the areas most critical to urban success: talent, connections, innovation and distinctiveness,� said the invitation to take the trip that economic development group Greater Portland Inc. is hosting. Cleveland appeared on Portland’s radar in late 2010 when the Portland Business Alliance, the region’s chamber of commerce, saw similarities
between the two distant markets. “Where we were once virtually an economic twin to Seattle, our falling incomes now make us more like Pittsburgh and Cleveland,� an economic analysis commissioned by the alliance stated. “It is time to make private-sector job creation our immediate and top priority.�
Admiration for Team NEO Brian Owendoff, a Clevelander who now is in the real estate business in Portland and is active in the town’s economic development efforts, said the Portland group wants to learn how Team NEO, the nonprofit business attraction organization, has convinced communities to go “hunting in a pack� for new businesses rather than going off on their own or competing among themselves with lavish incentives to attract employers. Colin Sears, vice president of business development for Greater Portland Inc., said Team NEO officials “have done a better job attracting international firms and growing firms in the region� than economic development groups in his market. “They’ve kept the pipeline full�
with international firms looking at Northeast Ohio for their North American operations, said Mr. Sears, whose organization recently has become his region’s counterpart to Team NEO. The visitors also will learn about how the philanthropic community has come together via the Fund for Our Economic Future to promote economic development; visit the Cleveland Clinic and learn about Cleveland Clinic Innovations, the unit that works to commercialize the Clinic’s medical innovations; and visit with the leaders of the Cleveland Leadership Center and Global Cleveland to see how the community is attracting new talent and nurturing new leaders. The group also will receive a brief overview of the city’s history from John Grabowski, a history professor from Case Western Reserve University, and will make visits to Playhouse Square and the Cleveland Clinic, as well as taking in a Cleveland Indians game at Progressive Field.
Different, yet alike Image-wise, the two regions couldn’t
appear more different — even on television. Shot in Portland, the show “Portlandia,� on the IFC cable channel, depicts a hip and offbeat place where people in their 30s and 40s ride their bikes to work at Nike Inc., the shoemaker that is based in Beaverton, Ore., less than 10 miles west of downtown Portland. None of the stars of “Hot in Cleveland,� a traditional sitcom shot in a Hollywood studio for the TV Land cable channel, is under 50 and the characters make remarks like, “Cleveland has a Fashion Week?� The Portland region, with 2.3 million people, is smaller than the nearly 4.0 million in the 16-county region Team NEO serves, though the city of Portland (population 583,776) is now larger than Cleveland (396,815). But, said Mr. Owendoff, senior vice president of Capacity Commercial Group, a Portland real estate brokerage, the Portland region is trying to grow its manufacturing base, which includes companies such as Intel Corp., the largest private employer in the region, and even a steel mill, the Oregon Steel Mills division of Evraz plc, an international metals and mining company based in Moscow. One goal is to
attract companies that supply aircraft giant Boeing Co., which has a strong presence in the Pacific Northwest. As much as Northeast Ohio, the Portland area is trying to tie together disparate communities. While it doesn’t have nearly as many municipal jurisdictions as Northeast Ohio, it does straddle two states, Oregon and Washington. One state, Washington, has become attractive because it has no state income tax, while retail businesses are more attracted to the Oregon side, because that state has no sales tax. The Oregon side also is handicapped by something called the “urban growth boundaryâ€? that prohibits residential and commercial development on greenfields outside its boundaries, which now covers much of three countries. As a result, Mr. Owendoff said, there are only two industrial sites of more than 25 acres within the growth boundary that he can show site selectors. Portland leaders have made these trips for decades, Mr. Owendoff said, under the name Portland Ambassadors, a group that now is under the Greater Portland Inc. umbrella. Last year, he said, the destination was Detroit; next year, the plan is to go to Israel. â–
Ohio AG sues BP on behalf of pension funds Ohio Attorney ON THE WEB Story from misleading when General Mike DeWine www.CrainsCleveland.com. made. has filed a lawsuit The lawsuit also against oil giant BP on behalf of names various BP officers and direcfour of the state’s pension systems tors as defendants. — the Ohio Public Employees The state lawsuit comes two Retirement System, State Teachers months after a Texas federal judge Retirement System of Ohio, School dismissed certain claims involving Employees Retirement System of BP ordinary shares in an ongoing Ohio, and the Ohio Police and Fire class-action lawsuit in which the Pension Fund. Ohio Public Employees Retirement The lawsuit, filed in Cuyahoga System continues to act as co-lead County Common Pleas Court, claims plaintiff. that BP misrepresented information The judge overseeing the federal about its safety practices and lawsuit let stand class claims involvprocedures before the Deepwater ing purchases of BP’s New YorkHorizon offshore well explosion in traded American Depository April 2010. Shares, but dismissed those involvThe lawsuit also alleges that BP’s ing BP ordinary shares as not covstatements regarding the size of ered by federal securities law. the oil spill that resulted from the The new state lawsuit relates to explosion were knowingly false and BP ordinary shares.
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Bank stocks rise on better balance sheets Older cars Industry valuations hit four-year high; local institutions are among big gainers By MICHELLE PARK mpark@crain.com
So far, this has been a comeback year for banks. Bank valuations have rallied in recent months and now stand at their highest levels since their crashing lows of late 2008. Stock prices have followed suit, though both they and valuations remain well below precrisis levels at many banks. SNL Financial data compiled by Paragon Capital Group LLC in Mayfield Heights reveals that the average price-to-tangible book multiple — a measure that compares the equity on a company’s balance sheet against what people are willing to pay for it — of most public banks in Ohio has increased, many by doubledigit percentage rates, in the past six months. The gainers include KeyCorp (up 31.7% from Sept. 30, 2011, to April 18), FirstMerit Corp. (up 39.5%), LNB Bancorp Inc. (up 71%) and PVF Capital Corp. (up 48%). Year-to-date through April 18, the SNL U.S. Bank & Thrift index was up 23.4%, outpacing the Dow Jones by 3½ times and the S&P 500 by more than double. That means once-
decimated bank stocks strongly outperformed the broader market, something that hasn’t been the story for some time. “After years of very poor performance, banks are finally getting a good look again,” said Bill Hegarty, chief investment officer for McDonald Partners in Cleveland, who expects bank stocks soon should get broader appreciation from both institutional and retail investors. “I think that they’re underowned, they’re underappreciated,” Mr. Hegarty said. “It’s just now that people are gaining faith. People have begun to realize the banking system is back.”
Up off the canvas The outperformance by banks has not been widely recognized, but it has been fairly dramatic and unlike any observed since the crash of 2008, said Charlie Crowley, managing director of Paragon Capital Group, an investment banking firm that largely serves financial institutions. Most of the climb has occurred since early this year. “I think it means the industry is getting back on its feet,” Mr. Crowley said. “That’s good for business borrowers and consumers.” Mr. Crowley and others speculate that more bank mergers and acquisitions will follow the improvement. “For the last few years, we have, in many cases, been advising clients to ride out the storm before
they would consider raising capital or entering into merger discussions, either as a buyer or seller, and that advice has largely been driven by the valuations,” Mr. Crowley said. If the healthier environment continues over the next few years, Paragon expects an upswing in merger and acquisition activity among healthy banks and more capital raising activity. Industry observers say valuations and stock prices have been picking up because of quarter-by-quarter improvement in asset quality metrics, such as nonperforming assets and net charge-offs, and increasing clarity around regulation and what it may mean for institutions.
Staying away no more The rally is causing some local portfolio managers to consider buying greater positions in banks. Among them is The Ancora Group, a large registered investment adviser in Beachwood that’s planning to increase its bank position — albeit selectively. “We had kind of stayed away from financials for the last couple years,” noted Sonia H. Mintun, vice president of Ancora. “We do think banks are attractive longer term,” Ms. Mintum said. “A lot of the banks have been able to get rid of their problem loans. They are strengthening their balance sheets. The capital ratios are a lot stronger in select banks.”
In addition, 19 of the country’s largest banking companies underwent Federal Reserve stress tests, the results of which were released in March and revealed that the majority of them would continue to hold sufficient funds in reserve despite large, hypothetical, projected losses. That proved to be “another sigh of relief,” Mr. Crowley said, because instead of being required to raise new capital, many banks were afforded the opportunity to increase their dividends, resume paying their dividends or initiate stock buybacks. Bank failures throughout the country have slowed to a trickle, too. “For the industry as a whole, there are fewer new problems popping up than there are existing problems being resolved,” Mr. Crowley said. “That’s given a huge jolt of confidence to the market with respect to these bank stocks.” Will the confidence last? Ancora Group’s Ms. Mintun expects it to because commercial loan demand has strengthened. Even so, she says the uncertainty in Europe and persistent pressure on bank margins will remain big challenges. Relative to the broader market, Mr. Crowley said, banks have a “decent chance to outperform.” “There’ll be more people buying these stocks and selling these stocks at a given level, and the price will go up,” he predicted. ■
drive need for services By ELLEN MITCHELL Automotive News
DETROIT — More than half of automotive aftermarket and repair purchases in the United States last year were for vehicles eight years or older, and demand for products and services to keep aging vehicles running is expected to stay strong, industry researcher NPD Group says. The U.S. vehicle fleet is getting older — the average age of light vehicles reached a record high of 10.8 years in 2011, according to research firm Polk. The automotive aftermarket and repair sector is benefiting. Among consumers buying aftermarket products or services, 59% reported their purchases were for vehicles eight years or older and 19% said they were for vehicles 15 years or older, NPD Group said. This is a significant increase over the pre-recession distribution of vehicles by age, according to NPD’s Car Care Track, which monitors purchase behavior of auto aftermarket and repair consumers. Before the economic downturn, only 51% of consumers reported buying products or services for vehicles eight years or older. ■ Ellen Mitchell is an intern with Automotive News, a sister publication of Crain’s Cleveland Business.
Makers: Demand for cheaper parts drives creation of printer continued from PAGE 3
dollars. Over the past few years, however, a handful of companies have started selling smaller printers that individuals and small businesses can afford. One of the most well-known is MakerBot Industries LLC of Brooklyn, N.Y., a venture capital-backed company that, like MakerGear, sells a machine that takes up less counter space than a microwave. The bigger, more expensive 3-D printers have their advantages. They often can make parts from several types of materials, and some even can make parts out of metal. Plus, they can print bigger parts, and they tend to be better for printing parts that need to be smooth. Still, there’s a lot of demand for smaller machines, Mr. Pollack said, noting that he’s sold about 700 printers, enough to make his company profitable. Today most of his 3-D printers go to individual “makers,” who design and build things as a hobby, as well as artists and schools, which use them for educational purposes. Eventually, however, he wants to sell more of them to small businesses, which can use 3-D printers to create prototypes and, in some cases, final products. “You put this in the hands of people, you don’t know what’s going to pop out,” he said.
21st-century table saw Mr. Pollack was a principal at a Cincinnati-based automotive software company that was sold to the Reynolds and Reynolds Co. of Kettering in the late 1990s. He became
interested in manufacturing about 10 years ago. He wanted to make a Nintendo Wii-style motion controller that his kids could use to play computer games, but at the time he couldn’t afford to produce it. Over the next few years, though, he watched the cost of electronics and manufacturing equipment come down, which helped drive the maker movement. Seeing a need for a cheaper way to make parts in small numbers, he started outfitting his house with the equipment he’d need to make 3-D printers. In addition to his four printers, Mr. Pollack has lathes, mills, a laser cutter and other equipment at his house. He eventually wants to make smaller, MakerGear versions of some of that equipment. “A laser cutter and a 3-D printer are like the bandsaw and table saw of the 21st century,” he said. Nowadays, it’s easier for an individual or a small business to access manufacturing equipment as well as free, open-source product design software, said Joe Gorse, a member of the 2-year-old Maker Alliance Inc., a nonprofit group of local makers. That increased availability should make it easier for entrepreneurs and small businesses to develop products that rival those made by larger companies, said Mr. Gorse, who until last year was an electrical engineer at Battelle Memorial Institute in Columbus. They can even work together to create “open source” products just as individual software developers do today. “You just need the idea,” he said. ■
ABOVE: These parts were all created using MakerGear LLC’s 3-D printers. The 3-year-old Shaker Heights company has sold about 700 of its printers, which are much less expensive than most 3-D printers. LEFT: One of MakerGear’s “Mosaic” brand printers creates a bracelet. The printer works by pushing plastic through the tip of a tool that adds layers of plastic one on top of the next until the part is complete. STEPHEN HERRON PHOTOS
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Farm: Region not used to wealth Akron staffing firm sees uptick from shale boom continued from PAGE 1
with property owners and the local accountants and attorneys who represent them. “You basically have what I call a bunch of mini lotto winners,” said Frank Fantozzi, whose firm, Planned Financial Services in Brecksville, is considering doing seminars or direct mailers in the affected areas. Some property owners are walking away with more than $1 million in upfront lease payments, and they’ll need guidance for optimizing tax strategies, maximizing financial returns and planning their estates and wealth transfers, financial professionals say. One energy company alone — Chesapeake Energy Corp. — says it already has shelled out more than $2 billion in Utica shale lease payments. Reports of people receiving $5,000 to $6,000 per acre of land are common. “All of a sudden, now you’ve got any number of these large corporations knocking on your door,” said Matthew M. Pullar, senior relationship manager for PNC Wealth Management in the Cleveland market. “This is a windfall that may only happen once to these people, and they want good advice.” Driving many banks’ interest in serving the landowners is the fee income to be earned on wealth management services, said Denise Penz, executive vice president, chief operating officer and wealth manager for Premier Bank & Trust in Canton. “Interest rates are so low that banks cannot survive on margin alone,” Ms. Penz said. “So everyone’s seeking some kind of fee income.”
Millionaires overnight Instead of inviting groups of people to hear the bank’s pitch, Premier Bank & Trust executives are visiting with two to three individual landowners a week, Ms. Penz said. They’re generating leads through attorneys, accountants and existing clients. “A lot of the families that we’re seeing are getting over a million dollars,” she said. “Especially in this part of Ohio and West Virginia, these are people who have struggled for years. It’s pretty exciting ... to see millions of dollars flowing into the area.” In an interesting twist, some owners of farmland who had exited the farming business because of economic stress now see their sudden wealth as an opportunity “to do what they love again” and reinvest in their farms, Ms. Penz said. “Our bank, being a community bank, we’ve always looked at (serving) those groups,” she said. “The focus is a little different: Now they have money to invest, where before they needed money.” Many banks are focusing not just on serving suddenly wealthy property owners, but businesses, too, that are busier and thus have more banking needs. For example, Key is working with a company that has seen a “big increase” in demand and wants to expand its transportation fleet, said Jeffrey C. Douglas, president of KeyBank’s eastern Ohio district, which includes the Akron, Canton and Youngstown areas. Key began its shale-related outreach a couple months ago, he said. And Premier Bank & Trust is discussing lending to a woman whose catering business is cooking as she’s begun delivering meals to well sites.
Hail the shale team
Fifth Third Bank and PNC Bank also are making a new push in eastern Ohio. Fifth Third recently formed a “Utica shale team,” comprised of retail bank, commercial lending and private bank professionals, said Jim Schmitz, who heads Fifth Third Private Bank for the bank’s Northeastern Ohio affiliate. The bank has hosted a handful of free seminars, usually at a hotel or community place, he said. “These are folks who are not used to high streams of income, and when that stream ceases, there are risks to their livelihood because they may or may not be living outside their means,” he said. Mr. Schmitz cited stories of people and businesses going bankrupt after royalty payments from similar oiland-gas booms ceased. As for PNC, bank executives noted that the bank has offered agricultural banking services since 2007 and that its recent efforts in the northern Ohio market have more to do with expanding that specialized banking than it does with shale. But they don’t minimize the bank’s interest in the wealth phenomenon that’s unfolding. “Of course, when there’s opportunity for people going through liquidity situations, if we can be the bank of choice for that relationship, why would we not want to be there?” PNC’s Mr. Pullar said.
New face in town The banking opportunities that are presenting themselves now are the biggest in these rural markets in more than a decade, according to Ms. Penz, who noted that recent years have been a time of contraction in eastern Ohio as steel mills closed and banks consolidated. Many say the new focus won’t be fleeting and anticipate catering to these potential clients for years to come. Other financial professionals, however, have decided not to prospect for such business because they’ve heard residents in the shale region feel bombarded by lawyers, accountants and financial advisers and are becoming guarded against such efforts. As for Planned Financial Services, the firm is working to determine whether the cost and driving time merit an outreach effort, said Mr. Fantozzi, president and CEO. “We’re still kind of kicking the ball around,” he said. “You might walk away with one or two clients a two-hour drive away. Are these the kinds of relationships that you want? We want to make sure that if we have clients that they’re good fits for both of us (the client and the firm).” Besides, Mr. Fantozzi noted, firms like his have more of an uphill climb than banks that already operate in the shale region because financial planners tend to practice in suburban and urban areas, not rural ones, and thus don’t enjoy the same kind of brand recognition and trust. “If I’m this new face, what’s going to give people this incentive to work with our firm?” he said.
Satisfying work By contrast, Jeffrey N. Malbasa said he thinks taking the steps to get out in front of these property owners is “well worth it.” He’s chief operating officer of
“There are folks who are not used to high streams of income. When that stream ceases, there are risks to their livelihood.” – Jim Schmitz, senior vice president, Fifth Third Private Bank
Spero-Smith Investment Advisers in Beachwood, which in February hosted its first educational event on sudden wealth in Cadiz in Harrison County. Even if the firm makes 10 trips and picks up a single client, it’s a success, he said. For one, the wealth some people are raking in is significant, Mr. Malbasa said. Plus, doing work for those who never anticipated they’d need wealth management is “frankly, the most satisfying. “You really are helping someone a lot,” he said. Mr. Malbasa sees it as a positive that so many others are entering the fray, too. “I think competition’s good,” Mr. Malbasa said. “I think the more bankers and people involved in this, the more likely the individual with this money in hand is able to make an informed decision.” ■
By GINGER CHRIST gchrist@crain.com
An Akron-based technical staffing firm may not be directly involved in natural gas drilling, but it definitely is reaping rewards. Integrity Technical Services Inc. is expanding — locally and throughout the state — thanks to the influx of business the company is seeing from companies moving into the area. The company, which had just six employees in 2010, now has 18 workers and is ready to hire more. Integrity Technical has immediate plans to hire two to seven employees locally and within the year to open satellite offices throughout the state; each of those offices will employ four workers to start. Integrity Technical provides direct-hire and temporary engineering, information technology and technical workers. The company’s aggressive growth largely is tied to the shale industry and the anticipated tens of thousands of jobs expected to be generated by the natural gas boom. “In our industry, we’re the first to see when the economy’s going up
and when the economy’s going down,” said John O’Neil, the company’s president. “The economy definitely is making a turnaround,” he said. The past three months have been some of the busiest the 16-year-old company ever has had, said Jim O’Neil, vice president of sales and marketing and John O’Neil’s son. The biggest challenge in taking advantage of the recruiting opportunities available is finding enough skilled workers to fill the open positions, especially those in what John O’Neil referred to as “hardcore engineering” jobs. Apart from the demand in the natural gas sector, Integrity Technical also is seeing a general uptick in demand across all technical sectors. Such demand is leading to more full-time placements than in the past, as companies look to secure talent in the long term. To combat that problem, Integrity Technical is turning to technology. The company is updating its website, generating new distribution lists and devising computer systems to better recruit new employees. ■
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PUBLISHER/EDITORIAL DIRECTOR:
Brian D. Tucker (btucker@crain.com) EDITOR:
Mark Dodosh (mdodosh@crain.com) MANAGING EDITOR:
Scott Suttell (ssuttell@crain.com)
OPINION
Well done
D
avid Quolke didn’t have a say in the crafting of the School Transformation Plan pushed by Mayor Frank Jackson and Eric Gordon, CEO of the Cleveland Metropolitan School District. However, had he dug in his heels and said “no” to going along with the plan, the president of the Cleveland Teachers Union definitely could have jeopardized the plan’s chances for receiving the support it needs from the state Legislature to enact its controversial elements. Mr. Quolke took the high road instead, and thus stands to be a significant contributor in the effort to remake the Cleveland schools. As the head of a 6,000-member union, Mr. Quolke faces tremendous pressure to retain the status quo for the people he represents. And the transformation plan put forth by Mayor Jackson and Mr. Gordon is anything but the status quo. Differentiated salary schedules, where performance and specialized training factor into how much teachers are paid, are not the norm in public education. However, they’re part of the transformation plan. So is the use of hiring teams that include principals, teachers and parents to fill teaching positions, rather than the assignment of teachers based only on seniority. But it wasn’t just the contents of the plan that could have caused Mr. Quolke to stiffen his neck in opposition. He also could have let his pride get in the way, because he and his union were cut out of the process of creating the plan. Instead, it was the city’s chamber of commerce group, the Greater Cleveland Partnership, that sat at the table with Mayor Jackson and Mr. Gordon to put the plan together. Only days before the joint announcement by the mayor’s office and Mr. Quolke that they had reached an agreement on a reform plan, Mr. Quolke let Crain’s government reporter Jay Miller know he wasn’t happy that GCP had been involved so intimately in the process. “I think (GCP’s) role has been counterproductive,” Mr. Quolke said in an April 9 interview, just four days before the agreement was revealed. “I think it added to the divisiveness we’ve seen, as opposed to pulling people together.” Yet Mr. Quolke didn’t let those feelings stand in the way of reaching a compromise with the mayor and Mr. Gordon. Obtaining Mr. Quolke’s support may be the most critical element the plan’s creators could have in selling the reform package to members of the Legislature. Still fresh in the minds of state lawmakers is the uproar that took place last year when the Legislature passed Senate Bill 5, a measure that greatly reduced the collective bargaining rights of public employers — and subsequently was killed last fall by voters. Many legislators would prefer to avoid any appearance of meddling in public employee contracts, even if it’s only the contract of the teachers union in Cleveland. A united front should help in convincing legislators to let Cleveland implement its bold plan for reform in the way its school district operates. To all involved, we say, a job well done.
FROM THE PUBLISHER
Keep your eyes on racino, med mart
T
will depend on a Franklin County judge wo of Cleveland’s most talkedwho is expected to rule in a few weeks on about developments were in the a challenge to our General Assembly’s news again last week, from very approval of such operations at seven different angles, and we should Ohio horse racing tracks. be paying close attention. Now, if I’m Dan Gilbert and I have First, there is the imminent opening of sunk millions into this downtown casino, Dan Gilbert’s new casino in the former I’m not at all happy with this development Higbee department store on Public just a few miles away. After all, Square. Last Thursday, as nearly the logic that swayed Ohio 400 people squeezed their way BRIAN voters — after several rejections into the Silver Grille for our TUCKER at the ballot box — to approve shale oil breakfast, the noise of casinos was that the state is surconstruction reverberated down rounded on all sides by legalthe hallways. It was evidence ized gambling options and we that workers were hard at it, in should do what we can to keep anticipation of next month’s that revenue right here. grand unveiling of the HorseThat is sound thinking, but I shoe Casino Cleveland. can’t help but worry that these But while the work proceeded slot machine operations at on Ohio’s first casino, attention seven different spots will hurt Ohio’s also was drawn to a proposed Hard Rock four casinos under construction. I guess “racino” at the old Northfield Park harwe’ll find out soon enough. ness racing track. The thinking behind **** this development is that the installation THEN THERE WAS CHANGE — again of slot machines might revive interest — at the Medical Mart rising right now in the venue, which has lost significant from the downtown site adjacent to the purse money to out-of-state racino tracks. new convention center being built. In Whether the developers will proceed
another change in leadership, MMPI, the builder and operator of both facilities, has hired Jim Bennett to take over the $465 million project. Jim is a respected executive in town who ran the McKinsey & Co. consulting officers here for many of his 30 years at that firm, and then later was a senior executive at KeyCorp before moving on to help launch a health care IT company, Within3. This hiring is a signal that the recently formed Medical Mart task force, populated by folks such as Cleveland Clinic chief Toby Cosgrove, County Executive Ed FitzGerald and BioEnterprise CEO Baiju Shah, among others, felt it was time to help steer this ship. You could make an argument that such an effort should have been part of this from the beginning, but as that old saying goes, “better late …” Jim Bennett is a respected business leader who’s “one of us” as a Youngstown native and longtime adviser to top firms in the region. Between him and the brainpower in the task force, the Medical Mart should have much-enhanced chances of success as it proceeds toward a 2013 planned opening. ■
THE BIG ISSUE SouthPark Mall in Strongsville was sold last week because it was considered a non-core property by its owner. Do you think there will be shopping malls in 20 years?
JIM HAY
DENNIS BAHENA
BRIDGET HOPP
SARAH BATKE
Cincinnati
Lakewood
Lakewood
Lakewood
I think in 20 years’ time, folks are still going to enjoy going out and doing the things that shopping brings them that they can’t do online. I think online shopping is going to be dominant, but I don’t see shopping malls completely vanishing.
I still think there will be shopping malls, just fewer of them.
I don’t know about the traditional shopping mall. … But I think places like Crocker Park and Legacy, where there’s ‘eat, play, live’ … I think that will be a big thing in 20 years.
I hope not. … They’re just so generic. I prefer walking down a sidewalk and having storefronts; that really brings back the feel of window shopping. It’s not the same when you’re in a mall with a bunch of generic stores.
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After $600K tech investment, Alliance can connect clients, prospects faster By MICHELLE PARK mpark@crain.com
Alliance Solutions Group in Independence plans to go live this month with a roughly $600,000 investment that its president says not only will make the staffing company quicker and more effective at hiring for its clients, but also will allow it to share staffing data with the broader marketplace. Alliance Solutions, which comprises eight specialized staffing units for various industry sectors, said the new technology, called 1Staff, can match skills Alliance customers are looking for with candidates in the system immediately, president Aaron Grossman said. Although Alliance at present uses a database with tens of thousands of names in it, its people manually must search the database to find talent. Using the new system, they can create a job order with delineated skills, and all candidates that meet
that criteria will populate the order automatically. In addition, Alliance can have the new system call those candidates and leave automated messages about job opportunities. “It’s a huge opportunity for us to scale the business quickly,” Mr. Grossman said. “We’re seeing a huge uptick right now in opportunity and we’re trying to create an infrastructure that can support and scale the business.” Alliance’s revenues at the end of the first quarter were up 42% over the first quarter of last year, said Mr. Grossman, who declined to disclose quarterly revenue figures. Mr. Grossman said he expects Alliance to reach about $50 million in revenue in 2012, and he wants to see it hit $100 million by 2016. He plans to roll out an acquisition strategy next year through which Alliance will seek to acquire local and regional companies, he said. A $600,000 investment is significant for the size of company Alliance
Exports: Prices could jump 10% continued from PAGE 3
dropped below $4 per MCF last year, and gas has been trading at prices of less than $2 per MCF recently. The industry desperately wants the price of the commodity to rise. As a result, it’s supporting measures that range from the conversion to natural gas power of gasoline vehicles and electric generation plants, to the construction of export facilities that could package liquefied natural gas and send it to markets in Asia, where the price recently has been more than 10 times what it is in the United States.
Getting their gas in gear The U.S. Energy Information Administration in January estimated that the nation’s energy companies stand to reap an extra $14 billion to $43 billion in annual revenues if natural gas exports are allowed to rise. The broad variance between those numbers reflects the uncertainty of gas prices, demand for the fuel and competition from abroad, according to the EIA report. But first, drillers must find a way to get their gas to market. They have some access to export points such as the Gulf Coast, via existing pipelines and other infrastructure, according to the EIA. Also, Houston-based Cheniere Energy Inc. plans to build a $10 billion liquefied natural gas plant in Louisiana. Cheniere on April 16 received federal approval to build the plant, and it has said it plans to break ground this spring. Cheniere estimates the plant would export as much as 1 billion cubic feet of gas per day initially, with room to double in size if conditions warrant expansion. The likely buyers of that gas will be nations in Asia, including China, the EIA and others predict. They may own the gas even before it gets to the LNG terminal; the CEO of Chesapeake Energy, the largest driller in Ohio, reportedly has been trying to sell billions of dollars of U.S. energy reserves to Asian investors. The company already has sold some of its holdings to foreign investors, and Chesapeake CEO Aubrey McClendon has pledged to sell $17 billion of
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such assets by the end of 2013. A Chesapeake spokesman declined to be interviewed for this story. The Bloomberg news service, however, reported that Mr. McClendon is focused on increasing the price of natural gas in the United States, and so are his investors. “We are presently owned by a group of investors who don’t think gas prices will ever go above $4 (per MCF),” Mr. McClendon was quoted as saying in a March 12 story. “I want to be owned by investors who live in a part of the world that believes gas prices will never go below $10.”
Market forces Higher gas prices would be the downside of exporting natural gas, in terms of the effect it would have on most businesses and consumers. The EIA predicts the long-term effect of exports on gas prices will be to increase prices by about 10% or so by 2035 over the price natural gas might fetch without exports. In the interim, however, exports could cause prices to rise in the United States by as much as 50% over what they’d be without exports as soon as 2018, depending upon how much gas is produced and exported and how fast the U.S. economy is growing. The EIA did not predict the price of gas in the future, just the effect exports would have on prices in percentage terms. Factors that include increased demand by power companies converting from coal to natural gas generators, or drivers converting vehicles from gasoline to natural gas, also could push up prices, according to the EIA . Environmentalists have complained that exports will lead to higher gas prices, which in turn will lead to more fracking — the process of hydraulic fracturing of the shale rock to release its gas and oil. But that’s exactly what energy industry proponents hope will happen. And, so far at least, there is little, if any, opposition to exporting natural gas from the business community. The American Chemistry Council, which represents an industry that stands to benefit more than
is, said Tom Erb, president of Tallann Resources, a Columbus firm that does training and consulting for the staffing and recruiting business. Now is a time when many staffing companies are making investments, added Mr. Erb, who also is president of the Ohio Staffing and Search Association. Mr. Grossman said Alliance plans to begin sharing quarterly reports in 2013 that will provide Alliance’s data to non-clients. Mr. Grossman said he isn’t sure whether he’ll sell the data or provide it for free. The reports will reveal which sectors are hiring, what positions they’re hiring for and how much they’re paying, plus where applicants are coming from, such as through job boards and social media. The system also will provide data that identifies the types of candidate traits that prove best suited for certain positions, based on success ratios and retention data for specific positions, Mr. Grossman said. ■
most from low natural gas prices, took The Wall Street Journal to task on March 9 for implying that the organization was in favor of the government limiting exports. “We put our confidence in the free market to determine natural gas supply and demand. We would oppose legislation that attempts to restrict exports of natural gas,” council president Cal Dooley wrote to The Journal in a letter provided by the industry group. Not that the American Chemistry Council doesn’t want to see more gas produced. It projects that a 25% increase in the supply of U.S. ethane, a chemical feedstock derived from natural gas, would lead to a $32 billion increase in annual chemical production by U.S. companies.
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Balancing desires It’s possible that higher natural gas prices could result in more ethane and other feedstocks for U.S. industry, because the feedstocks could be separated from natural gas before the gas is exported. In that scenario, higher export prices could lead to more drilling and thus more ethane production. However, the Energy Information Administration’s report states that U.S. gas might have a tougher time finding overseas buyers, or be worth less on the world market, if those ingredients are not included in gas that is exported. Politically, the topic appears to be a hot issue that could force politicians to balance the desire of consumers for low natural gas prices with the desires of the energy industry to increase its revenues. Spokespeople for Ohio Gov. John Kasich, U.S. Sen. Rob Portman and U.S. Rep. Tim Ryan of Youngstown all failed to respond to email invitations to discuss the issue, as did the Ohio Oil and Gas Association. One politician who did respond, U.S. Sen. Sherrod Brown, still avoided saying whether he opposes or supports natural gas exports. “Sen. Brown believes that shale drilling in our state should employ Ohioans, and be used primarily to reduce natural gas costs for Ohioans and provide a low-cost fuel source for domestic manufacturers,” said his press secretary, Allison Preiss. ■
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GOING PLACES JOB CHANGES ARCHITECTURE ARKINETICS: Liana Lake to director of marketing and business development.
ENGINEERING TES ENGINEERING: Mandy Phelan to business development professional.
ENTERTAINMENT CAESARS ENTERTAINMENT CORP.: Jennifer Veselko to in-market national sales manager.
FINANCE FIFTH THIRD BANK, NORTHEASTERN OHIO: Thomas Cupach to vice president, business banking relationship manager; Paul McHugh to assistant vice president, business banking relationship manager. KEYBANK: Tim Gretkierewicz to senior vice president, business banking, Greater Cleveland district.
FINANCIAL SERVICE BEACON FINANCIAL PARTNERS: Elizabeth Isaacs to relationship manager. KIRTLAND CAPITAL PARTNERS: Nicholas Leiby to senior associate.
RIVERSIDE CO.: Matt Dailey to partner; Jennifer Boyce to chief compliance officer.
INSURANCE HYLANT GROUP: Jessica Staggs to wellness coordinator, employee benefits practice; Cally Gaglione to HR assistant and office manager. MEDICAL MUTUAL: Dan Polk to vice president, small group sales and broker distribution. OSWALD COS.: Michael Cremeans to practice leader, life sciences.
LEGAL SCHNEIDER, SMELTZ, RANNEY & LAFOND: Jonathan Wilbur to of counsel; Scott J. Robinson to associate. TUCKER ELLIS: Jeffrey A. Fickes to counsel. WALTER & HAVERFIELD LLP: John A. Heer to partner.
MANUFACTURING SIFCO INDUSTRIES INC.: Brian Wofford to production control manager; Shawn Ashley to quality metallurgist.
WWW.CRAINSCLEVELAND.COM
APRIL 23 - 29, 2012
Hedrick to project coordinator; Joe Gabriel to .NET web developer; Seth Coelen to front-end web developer. MARCUS THOMAS LLC: Amber Zent, Julie Sur and Shanon Zaher to management supervisors; Mary Jo Spletzer, David Evans and Jennifer Spike to account executives; Azka Khan, Brooke Carpenter and Natalie DeGrandis to assistant account executives; Jordan Burnside to SEO manager. ROSENBERG ADVERTISING: Melissa Sattler to principal. WHITESPACE CREATIVE: John Puglia to creative director; Eric Jacobs to associate creative director of design; Jen Snider to associate creative director and copywriter; Ralph J. Davila to director of public relations.
MEDIA ADVANSTAR COMMUNICATIONS: Lois Bowers to editor-in-chief, Medical Economics.
NONPROFIT GEORGE GUND FOUNDATION: Fei Li to the 2012-2014 Gund Fellow. MONTEFIORE: Mark Weiss to administrator.
MARKETING
SERVICE
HILEMAN ENTERPRISES: Katie
FRESH FORK MARKET: Parker
Cupach
McHugh
Isaacs
Leiby
Polk
Wilbur
Fickes
Wofford
Ashley
AWARDS
Weiss
Modlin
Manse
MICROSCOPY SOCIETY OF AMERICA: William J. Landis (University of Akron) was named a Fellow.
RETIREMENT
Bosley to 2012 chef in residence. TALENTWISE SOLUTIONS LLC: Hollie Zelenka to regional sales manager, Ohio. TURFSCAPE INC.: Nick Stevens to business development specialist.
TECHNOLOGY CHRISTINE GALVIN DESIGN INC.: Rob Adams to back-end developer. LAZORPOINT: Brandon Wiser to client services engineer; Christine Fuchs and Corneliu Pop to project engineers, software development; Matt Kraska to director of delivery.
NATIONAL MEDICAL FELLOWSHIPS: Dr. Charles Modlin (Cleveland Clinic) received the Distinguished Alumni Award.
BRUNER-COX LLP: Ronald J. Manse after 15 years of service, effective Nov. 1, 2012.
Send information for Going Places to dhillyer@crain.com.
Burlington coat seller moving into Great Northern Plazas
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Discount retailer Burlington Coat Factory will fill a two-store vacancy and add another anchor to Great Northern Plazas in North Olmsted. Beachwood-based landlord DDR Corp. spokesman Martin Richmond confirmed the store will open toward the end of the year. A spokeswoman for the Burlington, New Jersey-based chain declined comment. The 72,000-square-foot store will fill vacancies created by the 2008 closing of a Steve & Barry’s apparel store and the exit of a Marshall’s store to Fairview Park. The new Burlington store will be on the Country Club side of the plazas west of the separately
owned Westfield Great Northern mall. DDR’s website said the retailer and home goods store will be the thirdlargest tenant in the nearly 650,000square-foot, open-air center. Adding Burlington to Great Northern Plazas will help the center because it will add a new tenant and product line to the western suburb, said Kimberly Wenger, North Olmsted planning and development director. DDR also plans to upgrade the 1980s-vintage center with an upgraded exterior and additional landscaping as far north as the Best Buy store in the plaza, she said. The suburb is trying to create a more welcoming atmosphere on the Country Club Drive side of the center and plazas, Ms. Wenger said. â–
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WHAT THE FINANCIAL COMMUNITY IS SAYING DENNIS A. DEVINE Group executive vice president; Consumer banking, director of U.S. Distribution RBS Citizens Financial Group Inc., parent company of Charter One
WHO TO
WATCH FINANCE IN
W
hether it’s advising clients, working at a bank or credit union or specializing in investment banking, those working in finance face an ever-changing environment. In this section, we highlight some
ALLISON BATT Financial planner
MICHAEL DOUGLAS Financial adviser 212 Capital Group
W
ith the help of Allison Batt and Michael Douglas, medical professionals should have no problem sorting out their financial future. For about the last year, the two financial gurus have worked in tandem out of 212 Capital Group’s Westlake office, where they’ve carved a niche advising medical
CHRISTINE BLAKE CEO Cardinal Community Credit Union
C
hristine Blake has come full circle in her career — she now runs the Mentorbased credit union where she got her first job in finance as a teller and not far from where she grew up in that city. In between, though, Ms. Blake spent a lot of time working with much bigger companies, including as an auditor of banks and finance companies for the national accounting firm KPMG in both Washington, D.C., and Cleveland. As a result, Cardinal Community Credit Union got big-league experience and small-town common sense and charm all in one package when it made Ms. Blake CEO in August 2010. “She’s wonderful — very, very outgoing, very, very smart and she has a great background, coming from KPMG,” said Cardinal Com-
residents, fellows and physicians on wealth management, estate conservation, loan repayment, tax reduction and other complex financial strategies. “We put 100% of our effort into understanding where doctors are coming from,” Mr. Douglas said. “We enjoy complicated situations. We enjoy a challenge, and doctors
munity Credit board secretary Randy Mears, who is also president of Mears Financial Services, an investment management firm in Mentor. Ms. Blake has been able to keep the credit union profitable and accelerate its growth by re-engaging in activities such as auto lending and expanding into business lines such as home mortgages, Mr. Mears said. “She’s had exponential loan growth, in what has been a very, very difficult time,” Mr. Mears added. Cardinal Credit is not small, as far as credit unions go — it has 18,000 customers, assets of about $160 million and 54 employees to manage it all, Ms. Blake said. But, Ms. Blake said she’s particularly happy to be at a less-thangiant institution and knew she would be from her days as an auditor and consultant. “When I did consulting work, I
of those you may not know who are making their mark in the world of Northeast Ohio finance and positioning themselves as leaders. We also ask others working within the finance field to weigh in on challenges facing the sector in the future.
bring that.” Both Ms. Batt and Mr. Douglas, who conduct financial seminars two or three times a week at area health systems, said it’s a bit unusual for two financial professionals to work closely together on every project. Still, they wouldn’t have it any differently. After all, teamwork — in their opinion — fosters the best results for their clients. “This is a team,” Ms. Batt said. “If my mom’s a client, she’s the team’s client. There’s a level of depth, and clients get more expertise.” Dr. Ashish Bhimani, one of the team’s clients and a clinical
was in a lot of different places. I saw that you can do a lot more as a leader of a small organization … things you might not be able to do at a large institution,” Ms. Blake said. For example, when she wanted her institution to get involved with local school systems to help teach students about basic personal financial management, she didn’t have to go through boards and committees and was able to get the program up and running quickly. Her board expects the institution to be profitable, of course, but high profits are as much a goal in the credit union arena as is providing the best rates to customers, who in the case of most credit unions actually own the institution. “We try to make money off small margins,” Mr. Mears said. “We’re not there to make millions of dollars; we’re there to be profitable and give our members better
cardiac electrophysiology fellow at University Hospitals, said Mr. Douglas and Ms. Batt complement each other well. “I think they’re really awesome,” Dr. Bhimani said. “I would sell them to anybody I can. It’s a nice feeling to have people like them that you can trust.” Most importantly, Dr. Bhimani said they’re both accessible — a welcome relief for time-crunched physicians. “We put in many hours, but we never refer to it as work,” Mr. Douglas said. “We love getting up in the morning, being the first ones in the office and last one out night.” — Timothy Magaw
rates.” But, at the same time, the lender must compete with large commercial banks, some of them national giants. It’s David vs. Madison Avenue in terms of competing via advertising, Mr. Mears said, so it’s critical to have a CEO who will successfully represent the organization in the community. That’s a specialty of Ms. Blake, he said. As for Ms. Blake, she said her experience with KPMG, as well as the credit union itself and the surrounding community, all help her to succeed in her job. But the thing that helps the most, she said, is that she just loves her job. “My background and training has prepared me adequately for what I do, but it’s also having a love for what I do and a love for the philosophy — that’s what makes me able to do what I do,” she said. — Dan Shingler
■ What types of attributes will be needed in tomorrow’s leaders? There are three key practices that will make tomorrow’s leaders successful. Empower your people: Build a strong and diverse team; create the environment for each to do what he or she does best and then celebrate their successes. Have a vision: With your leadership team, look up from the day-today and have a clear vision of where you are going; clearly articulated priorities will keep you focused and your team engaged. Be customer-focused: Always remember we are here for our customers; they shape every decision we make. ■ What are some of the most significant challenges going forward? Our customers’ preferences on how to work with us and how they seek financial advice are quickly evolving. New competitors are entering the market, and changing regulation plays an important industry role. Flexible leaders and the best organizations will adjust to these changes with a strong customer focus — and will be positioned to help their customers more than ever.
ANN H. DURR President Valley Savings Bank ■ What types of attributes will be needed in tomorrow’s leaders? Respect, reliability and stability are vital now and will continue to be significant in the future. Tomorrow’s financial leaders will need to share their vision, gather input and ultimately bring their team together to develop solutions. This consensus-building approach demonstrates respect for individuals and what they have to say. Reliability and stability go hand and hand with respect. Tomorrow’s financial leaders must do what they say they are going to do and come to work as the same person every day. A good leader must be sincere and consistently approachable by employees and customers alike. ■ What are some of the most significant challenges going forward? Although the picture is brighter, we continue to face maneuvering through the economic recovery. Bringing strong analytical and communication skills to the table is imperative. Fortunately, as a small community bank we are in a position to better know our customers and evaluate their needs based on the local economy. This is beneficial for all involved. Technology, security and convenience also will continue to demand much attention. ...
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DANIEL J. BROWN Vice president, utilities, power and renewable energy KeyBanc Capital Markets
D
aniel J. Brown earned his undergraduate degree in mechanical engineering, and he has worked at a nuclear plant. So it makes perfect sense that he’s settled into a position with KeyBanc Capital Markets, right? Right — especially given that Mr. Brown specializes in the energy sector as vice president, utilities, power and renewable energy. “It’s a constantly changing environment,� said Mr. Brown, who in 2008 earned his master of business
administration from Purdue University’s Krannert School of Management. Of course, that change has been kicked into high gear of late. The discovery of shale gas is “revolutionizing the way people think of power generation. ‌ It’s a complete game-changer,â€? Mr. Brown said. Since joining KeyBanc Capital Markets, Mr. Brown has executed more than 20 project financings, raising more than $1 billion for renewable energy projects. He also has provided investment banking services to electric cooperatives and investor-owned utilities, and advisory services to infrastructure funds for potential
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acquisition of electric utilities, natural gas local distribution companies and renewable energy companies. Andy Redinger, managing director, group head of utilities, power and renewable energy, hired Mr. Brown, and he said that from the start, he was impressed by the Toronto native. “His maturity level does not reflect his age at all,� he said. Indeed, Mr. Redinger called Mr. Brown a “standout,� especially given his drive and insistence on working in the energy sector. “He doesn’t waste his words,� Mr. Redinger said. “When Dan makes a point, you better be listening.� In addition to his work with KeyBanc Capital Markets, Mr. Brown also is a board member of the Birchwood School in Cleveland, and he is on the community advisory board for WVIZ/PBS Ideastream Cleveland. — Amy Ann Stoessel
PETER FRANZ Partner and chief investment officer Cedar Brook Financial Partners LLC
P
eter Franz can dish it out and take it. No, that’s not a reference to his days as a linebacker at Wittenberg University. We’re talking about advice here — not punishment. A big part of Mr. Franz’s job at Cedar Brook Financial Partners LLC in Mayfield Heights is to give advice. Like other partners at the firm, he works directly with clients, helping wealthy families invest their money. On top of that, as the firm’s chief
Under no circumstances shall this announcement constitute an offer to sell or a solicitation of an offer to buy, nor shall there be any sale RI WKH %RQGV LQ DQ\ MXULVGLFWLRQ LQ ZKLFK VXFK RIIHU VROLFLWDWLRQ RU VDOH ZRXOG EH XQODZIXO SULRU WR UHJLVWUDWLRQ RU TXDOLĂ€FDWLRQ XQGHU WKH securities laws of any such jurisdiction. The Bonds will be sold by means of an Offering Circular. Proposed New Issue
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$430,295,0002 State of Ohio Hospital Revenue Bonds Series 2012A (Cleveland Clinic Health System Obligated Group)
APRIL 23 - 29, 2012
JESSICA COFFEY
uring her morning commute, Jessica Coffey often smiles when she passes the $275 million Flats East Bank project taking shape on the city’s west side. Having spent countless hours over the last few years helping patch together the complex financing to bring the long-talked-about project to life, Ms. Coffey takes pride in knowing she was part of a project that could breathe new life into a downtrodden part of the city. Ms. Coffey, a senior finance consultant at Project Management Consultants in Cleveland, might not be the most vocal figure in the city’s business community, but her fingerprints are all over some of city’s most well-known development projects. “What drives you to get to closing is to see construction under way and see the project become a reality,�
Ms. Coffey said. Beyond the Flats, Ms. Coffey has worked on the AmTrust Financial Services relocation to 800 Superior Ave., and the Courtyard by Marriott project in University Circle, among others. Ms. Coffey said while she enjoys delving into financial complexities, having a key role in spurring redevelopment in Northeast Ohio is the most rewarding aspect. Ryan Sommers, the development finance manager for Flats East Bank project, said Ms. Coffey has a natural ability to weave together public and private financing sources to bring projects to fruition — a “rather unique skill set,� he added. “It takes a lot of perseverance to see some of these projects through from start to finish,� Mr. Sommers said. “She’s persistent, but in a way that keeps everyone very happy and satisfied until the deal finally closes. It can be stressful, but I think Jessica keeps everyone focused on getting to the finish line.� — Timothy Magaw
investment officer, he helps his colleagues stay on top of changes in markets, asset classes and the various investment products at their disposal, such as mutual funds, third-party money managers and alternative investment vehicles such as real estate and hedge funds. Thus, it’s not uncommon for 12 different people to knock on his door on any given day. Even so, Mr. Franz said he learns just as much, if not more, from his colleagues. The 31-year-old says young people in general should try to spend time around talented people whenever they can. “If you do that you’ll be successful, in this business and in life,� said Mr. Franz, who also chairs Cedar Brook Financial’s investment committee, which chooses the investment firms and products that the company uses. After graduating from Kenston High School in Bainbridge Township, he studied political science at Wittenberg University. He enjoyed math, but he also wanted to work somewhere that let him build relationships, like his salesman father always did.
Luck helped guide him to Cedar Brook Financial. His family knew one of the company’s principals, who said the firm was looking for help managing the practice. So Mr. Franz joined on as an associate and spent the next four years learning the business. He spent a lot of time learning from Azim Nakhooda, who was chief investment officer until Mr. Franz took over the role just over a year ago. Mr. Nakhooda, who now is managing principal and CEO of the company, said Mr. Franz has accomplished a lot, given his age. Mr. Nakhooda noted that his younger counterpart pays close attention to his clients’ needs and gets to know them personally. That has helped him win business from much older clients who lately have been cautious with their money. “I think what Pete has done particularly well is build relationships,� Mr. Nakhooda said. Mr. Franz coached middle school and high school wrestling until recently and now helps recruit volunteers for the Boys & Girls Club of Cleveland. He lives in Shaker Heights with his wife, Molly, their son Pete, who turns 1 in July, and their yellow lab, Charlie. —Chuck Soder
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to our own Wayne Twardokus and all of this year’s honorees.
A decision to purchase the Bonds is an investment decision that should only be made after a complete review and understanding of the terms of the Bonds, including investment objectives, risks and charges and expenses. The securities herein are preliminarily described in the Preliminary Offering Circular dated as of April 18, 2012, a copy of which may be obtained from the underwriters listed above. No decision should be made prior to receipt and review of the Preliminary Offering Circular and applicable pricing information. Bonds may only be SXUFKDVHG WKURXJK D EURNHU DQG DQ\ RIIHU RU VROLFLWDWLRQV ZLWK UHVSHFW WR WKH %RQGV ZLOO EH PDGH VROHO\ E\ PHDQV RI D ÀQDO 2IIHULQJ &LUFXODU that describes the actual terms of such Bonds. Transactions involving the Bonds may not be suitable for all investors. You should consult with your advisors as to the suitability of the Bonds for your particular circumstances.
Important Investor Information concerning Brokerage and insurance products: Not FDIC Insured | May Lose Value | Not Guaranteed by any Bank | Not a Deposit | Not Insured by any Federal Agency
Investment Banking Solutions for the Middle Market www.leaguepark.com
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APRIL 23 - 29, 2012
BEN LAURENDEAU President and chief executive officer Firefighters Community Credit Union
I
n one sense, Ben Laurendeau is a credit union traditionalist. “I don’t need an org chart to know our employees’ names, or their spouses’ names, and you can’t say that at a big bank,” said Mr. Laurendeau, 43, the president and CEO of Firefighters Community Credit Union in Cleveland. The affinity for working with a 55-person staff aside, Mr. Laurendeau, who has had the job since 2004, is working hard to make Firefighters Community a thoroughly modern enterprise. As Mr. Laurendeau sees it, features including QR (quick response) codes, mobile banking, text alerts and online loan decisions should be every bit a part of the product mix at credit unions as they are at any other financial institution. “We’ve gotten in pretty early on that kind of stuff,” Mr. Laurendeau said. Such features are important, he said, because while credit union customers value a close relationship with the people handling their money, they also want to know they have access to technology that makes it as easy as possible to work with the credit union. Paul Mercer, president of the Ohio Credit Union League, said Mr. Laurendeau has helped Firefighters Community assemble “a modern product set” that appeals to younger customers. He said Mr. Laurendeau brings high energy and a “progressive, growth-oriented mindset” to the world of credit unions, where innovation traditionally has come slowly. “In our world, he’s kind of a rock star,” Mr. Mercer said Firefighters Community is the fifth-largest credit union in Northeast Ohio based on assets as of Dec. 31, 2011, according to a Crain’s list published on March 12. It had assets of $178.1 million, up 0.6% from a year ago. The credit union has just more than 25,000 members and operates four offices. And those numbers might soon be on the rise. Mr. Laurendeau said Firefighters Community is awaiting regulatory approval for a merger with the credit union that serves 3,700 members of United Food and Commercial Workers Local 880. He hopes to see that merger close in the third or fourth quarter of this year. Firefighters Community, founded in 1936 to serve Cleveland firefighters, still carries that name, even though it’s open to anyone in Cuyahoga and Lake counties. The credit union’s board, in a nod to tradition, so far has resisted a name change. But on the website, in a nod to the present, the name is preceded with three words: “not just for.” — Scott Suttell
NICHOLAS STALLARD Chief financial officer The Reserves Network
N
ick Stallard was a year into his job as the director of finance at Fairview Park-based The Reserves Network in 2008 when the recession got going. And since, in his words, the staffing industry in which Reserves is a leader is hypercyclical — meaning it’s even more sensitive to the economy’s fluctuations — he quickly was thrown into the fire. Yet Mr. Stallard, since 2009 Reserves’ chief financial officer, has helped the firm stay on course. As CFO, Mr. Stallard over-
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sees financial planning and forecasting, acquisitions and real estate endeavors, among other things, for the 165-employee company that operates out of 32 branches nationwide. That total includes 75 employees in Cleveland. Reserves Network — which, Mr. Stallard said, is seeking to exceed $100 million in revenues this year, a goal it fell just short of in 2011 — has completed six acquisitions in the past five years, including last year’s deal for Eagle Technology Group of Milwaukee. Mr. Stallard also has overseen expansions in the last two years into Atlanta; Chicago; Erie, Pa.; Louisville, Ky.; and northwest Indiana. “We’re very focused on growth, organically in markets we already
CRAIN’S CLEVELAND BUSINESS
“He’s relatively young in a high-demand position. He’s been successful because he’s a truly genuine guy.” – John Nicklas, vice president, Meaden & Moore serve and by way of acquisition in new markets,” Mr. Stallard said. On the real estate side, Mr. Stallard works with the company’s branch offices to explore relocations or lease adjustments for cash savings; most recently, Reserves Network relocated its three Illinois offices to more advantageous spaces. Mr. Stallard joined the company in 2003 after four years at McDonald Investments, and in addition to CFO and director of finance, he also previously served as the company’s business development manager for mergers and acquisitions, and managed the company’s
Orlando, Fla., market. “He’s been able to showcase the capabilities he has in his current position, which gives him much more of a leadership role,” said Meaden & Moore vice president John Nicklas, whose company serves as Reserves’ accountant. “He’s relatively young in a highdemand position, and he’s been successful because he’s a truly genuine guy. People respond well to that.” Mr. Stallard, 35 and an Avon Lake resident, earned his bachelor’s degree from Purdue University and a master’s degree from Baldwin-Wallace College. — Joel Hammond
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COMING UP Crain’s will publish two more “Who to Watch” sections this year: ■ Who to Watch in Health Care, July 16 ■ Who to Watch in Law, Nov. 26 Email nominations to Amy Ann Stoessel at astoessel@crain.com.
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PAUL WEISINGER
e’s always looking for the next challenge, and Paul Weisinger continues to find them in accounting. A senior manager at the Walthall, Drake & Wallace LLP accounting firm in Independence, Mr. Weisinger is finding his challenges in keeping up with his clients’ businesses and with the constant financial reporting changes brought on since 2002’s Sarbanes Oxley Act. “The (financial) regulatory bodies are trying to put change in place,” he said. “It affects everyone and that’s where I come in. They
IN
– Scott Phillips Jr., Keller Williams Realty ask me, ‘Where do I fit in?’” The Middleburg Heights native started his college career at Cleveland State University thinking he wanted to be an engineer. But he quickly found out that what he wanted was to be a financial engineer. He worked in the CSU bursar’s office while going to school at night, graduating in 1998 with a degree in business administration. He joined Walthall Drake after graduation. His practice, and the firm’s, focuses on private companies and does the traditional accounting, tax and consulting services those companies require. “I consider my clients my friends,” the 35year-old CPA said. “We’ll grow old together.” His clients’ businesses run the
BUSINESS Commercial Banking is our business.
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“In a year and a half’s time, Paul has put in the financial systems for my company. Paul stepped in as my CFO ... making decisions and forecasting expenses.”
Senior manager Walthall, Drake & Wallace LLP
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gamut — and he’s recently added firms in the growing bioscience field — but he sees his focus as professional services and the related construction and real estate industries. “It’s been an interesting environment because although I learn (the real estate and construction industries) from the accounting and tax aspects, I’ve learned the engineering aspects as well,” he said. Scott Phillips Jr., who is building a residential real estate business under the Keller Williams Realty umbrella, said hiring Mr. Weisinger has been a key to building his business, which began with him as a commissioned real estate agent. “In a year and a half’s time, Paul has put in the financial systems for my company,” he said. “Paul stepped in as my CFO for a while, making decisions and forecasting expenses.” He said he was able to acquire a small real estate sales team recently because of the systems Mr. Weisinger put in place. Beyond his day-to-day work, Mr. Weisinger serves on the executive board of the Ohio Society of Certified Public Accountants and is on the advisory board of the Academic Support Center for Students With Learning Differences at Notre Dame College. — Jay Miller
APRIL 23 - 29, 2012
KEVIN WHITE Director Western Reserve Partners LLC
F
rom the windows at Western Reserve Partners LLC on the 37th floor of 200 Public Square, Kevin White has a terrific view of Cleveland. However, the director at the investment banking firm has an even broader world view. He is a veteran of 14 years in the industry with Citigroup and predecessor firms in two global finance centers, New York and London. His credenza also boasts more than two dozen Lucite plaques or toys associated with client businesses that bankers receive at the closing of a big deal. However, Mr. White became a Clevelander by choice for the lifestyle as his wife, Anne, grew up in Shaker Heights, the suburb that’s now home. “New York was cool, but New York with three kids was not cool,” Mr. White said. Cleveland offers top-drawer cultural activities and a broad enough regional business environment that he thought he could make a better go of it here than his hometown, Springfield, Mass. His résumé also lists degrees from Princeton University (economics) and Harvard Law School.
He landed in January 2008 at Western Reserve. Ralph Della Ratta, Western Reserve managing partner, was encouraged by Mr. White’s background. He also queried two executives he knew personally who had been Mr. White’s bosses. They said he worked hard and “had a lot of candlepower.” Mr. Della Ratta also said, “I also found him very down to earth given his accomplishments” and a good cultural fit for the firm. Today, Mr. Della Ratta said he is pleased with Mr. White. He notes Mr. White has helped Western Reserve form contacts with private equity firms and proven to be detail oriented. Today, Mr. White is settled in for a Cleveland-based career. At other jobs, he worked primarily with top-ranked national or global firms that had experienced executives with “just-do-the-deal” attitude. “Now I get to work with firms that may have been in the family for three generations before they merge or do an (initial public offering),” Mr. White said. “You can make a difference to them.” Mr. White also divides his time between diverse tasks such as serving as president of the Princeton Club of Northern Ohio and leading Cub Scout Troop 18 in Shaker Heights, which has his two sons on its roster. He also recently joined the board of Great Lakes Theater Festival and already speaks affectionately of attending its past shows. — Stan Bullard
ALSO KEEP AN EYE ON ... FRANK FANTOZZI President and CEO Planned Financial Services LLC It isn’t too hard to keep an eye on
Frank Fantozzi. Members of the business news media — including Crain’s Cleveland Business — regularly talk to him about the economy and investing. When meeting with clients, however, he prides himself
KELLY LAMIRAND Senior vice president and district credit officer Key Commercial Bank — Credit Administration, KeyBank N.A.
Bring morale up. About thirty stories.
I
n Key’s Cleveland district, Kelly Lamirand leads the credit team that monitors asset quality of local portfolios and approves loans originated by the Commercial Banking, Private Banking and Business Banking units. She brings a wealth of experience to the role. Mrs. Lamirand began her career at Key-
WAYNE TWARDOKUS Vice president League Park Advisors Thrills bring every group together. Your employees will all feel the exhilarating g-forces. The excitement of the water rides. And the powdered sugar of the funnel cakes. The very things that make a group outing to Cedar Point in Sandusky, Ohio unlike any other one. Visit cedarpoint.com/ group-sales or call 1-800-448-2428 to get your discounted tickets for your corporate group outing today.
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ayne Twardokus has been busy in his 10 years in the mergers-and-acquisitions business and in his short time at League Park Advisors. Mr. Twardokus, according to League Park, has directed more than 50 M&A transactions during his career, which has included stints
on hearing what they have to say before lending his own advice. One of his clients, A.J. Hyland, CEO of Hyland Software Inc. in Westlake, called him “a pillar of sanity in these crazy financial times.”
Bank in 1998 as a management associate in the credit training program. She later worked as an analyst in Counterparty Credit, underwriting Key’s credit activities with other banks and broker dealers. In 2001, Mrs. Lamirand moved into underwriting and credit approval for the Middle Market team. She has been in her current role since 2011. Mrs. Lamirand holds a bachelor’s degree in business from Miami University with a minor in economics.
at Harris Williams & Co., National City Capital Markets and Brown Gibbons Lang & Co. Most recently, he’s been heavily involved in the specialty chemical and gas industry, where he’s currently working on three engagements, according to League Park. Last year, he advised on the sale of Toledobased American Gas Group, one of the largest specialty gas manufacturers in North America, to Praxair Distribution of Danbury, Conn.
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WHO TO
APRIL 23 - 29, 2012
WATCH FINANCE IN
WHAT THE FINANCIAL COMMUNITY IS SAYING BILL PERDAN
CYNTHIA A. MAHL
President Financial Executives International, Northeast Ohio chapter
Executive vice president/ chief financial officer Western Reserve Bank
■ What types of attributes will be needed in tomorrow’s leaders? Leaders will need to be able to keep up with communications technology to be able to stay informed of opportunities at the same speed as their competitors. Leaders will need to have a flexible and innovative management style to keep employees energized about career development and work opportunities, as technology continues to change at a more rapid pace.
■ What types of attributes will be needed in tomorrow’s leaders? The most important attributes for finance leaders in tomorrow’s world will be the ability to solve problems using creativity and flexibility. In most industries, banking included, the landscape is always changing. To succeed, you need to be able to look at the problem (or opportunity) at hand and quickly derive a plan based on new technologies and the current and future needs of your company. You must always keep learning. You
CRAIN’S CLEVELAND BUSINESS DAVID THOLT
must also be able to effectively tailor your communication style for many different constituencies: board, staff, shareholders, customers, regulators and the public. ■ What are some of the most significant challenges going forward? Uncertainty, especially in the areas of new regulations and new technologies, provides the biggest challenge. Early in my career, I was asked in a job interview, “What is your tolerance for ambiguity?” That question sums up the current reality of being a leader in finance. (Incidentally, my tolerance for ambiguity has increased dramatically since then!)
Vice president and senior portfolio manager Huntington Bank Executive in residence Team NEO ■ What types of attributes will be needed in tomorrow’s leaders? Flexibility and innovation will be particularly crucial ... Information technology, biohealth and the commercialization of research-driven products and services are expected to be primary drivers of economic growth in the region. Thought leaders in banking and finance will need to consider how to prudently expand investment into industries where intangible capital assets such as patents, software and proprietary technology and processes are a busi-
■ What are some of the most significant challenges going forward? Managing through the business cycles, which seem to be more volatile than in the past. Leaders must be able to react to short-term events, but have the conviction and courage to do so without sacrificing long-term strategic goals. Knowing when to take action will become more difficult. Leaders need to stay focused on their core strengths and remain informed on technological improvements.
ALSO KEEP AN EYE ON ... STEVE WANK Chief financial officer, chief compliance officer Zelman & Associates
S
teve Wank, a Strongsville native and a 1999 Bowling Green State University graduate, has been at Zelman & Associates — a research firm founded in 2007 by Ivy Zelman with offices in Beachwood — for 3½ years, previously having served in the same capacity at Independence-based Longbow Research. Mr. Wank also worked as a manager for the accounting firm of Cohen & Company. “Once I left public accounting, there was no one above me to necessarily guide and mentor me,” Mr. Wank said of the transition to the type of work with which he’s now involved. “The biggest challenge … is learning on my own.”
COMING UP
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CFO of the Year Award nominations open soon
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Crain’s Cleveland Business again in 2012 will honor a group of the top chief financial officers in Northeast Ohio in the newspaper’s annual CFO of the Year Awards. The nominations open April 30, and the form can be found at www.crainscleveland.com/section/ event_home. For past classes and coverage of previous CFO of the Year Award receptions, visit www.crainscleveland .com/section/cclb_events_cfo.
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ness’s primary assets. ■ What are some of the most significant challenges going forward? Among the significant challenges ... will be how to optimize and leverage support for work force training and expansion. Demand for skilled workers in Ohio, particularly welders, machinists and CNC/CAM specialists, is expected to increase by 9% over the next seven years. These projections do not include the significant additional demand created by the Marcellus and Utica shale plays. Financial institutions, employers, economic development agencies and training institutions will need to effectively collaborate to shape policy, fund and significantly enhance the current system of skilled work force development.
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CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
APRIL 23 - 29, 2012
LARGEST COMMERCIAL CONTRACTORS RANKED BY 2011 REVENUE
Company Address Rank Phone/Website
Local revenue 2011 (millions)
New local contracts 2011 (millions)
# of local projects started 2011
New corporate contracts 2011 (millions)
# of corporate projects started 2011
FTE employees as of 4/1/2012 Local Corporate
Year founded Top local executive
1
Gilbane Building Co. 1621 Euclid Ave., Suite 1830, Cleveland 44115 (216) 535-3000/www.gilbaneco.com
$354.8
$357.3
13
$5,290.4
236
59 2,660
1873
Thomas M. Laird senior vice president, regional manager
2
Cleveland Construction Inc. 8620 Tyler Blvd., Mentor 44060 (440) 255-8000/www.clevelandconstruction.com
$309.1
$27.6
11
$128.4
46
60 669
1980
Jon D. Small president
3
Donley's Inc. 5430 Warner Road, Cleveland 44125 (216) 524-6800/www.donleyinc.com
$247.2
$116.9
29
$194.3
50
227 358
1892
Malcolm M. Donley president, CEO
4
Turner Construction Co. 1422 Euclid Ave., Suite 1400, Cleveland 44115 (216) 522-1180/www.turnerconstruction.com/cleveland
$247.0
$371.9
42
$7,920.0
1,500
144 5,068
1902
Mark L. Dent vice president, general manager
5
The Ruhlin Co. 6931 Ridge Road, Sharon Center 44274 (330) 239-2800/www.ruhlin.com
$167.3
$152.0
16
$327.0
26
155 227
1915
James L. Ruhlin president, CEO
6
Panzica Construction Co. 739 Beta Drive, Mayfield Village 44143 (440) 442-4300/www.panzica.com
$116.7
$90.0
34
$90.0
34
90 90
1956
Anthony M. Panzica owner, president, CEO
7
Fortney & Weygandt Inc. 31269 Bradley Road, North Olmsted 44070 (440) 716-4000/www.fortneyweygandt.com
$79.3
$7.1
14
$49.8
101
45 110
1978
Robert L. Fortney president
8
Continental Building Systems 23240 Chagrin Blvd., Suite 400, Beachwood 44122 (216) 454-0111/www.continental-buildingsystems.com
$53.3
$47.4
14
$198.0
87
19 148
1984
Rick Adante project executive
9
The Austin Co. 6095 Parkland Blvd., Cleveland 44124 (440) 544-2600/www.theaustin.com
$52.0
$45.4
32
$69.7
52
88 146
1878
Michael G. Pierce president
10
Infinity Construction Co. 18440 Cranwood Pkwy., Warrensville Heights 44128 (216) 663-3777/www.infinityconstruction.com
$43.7
$50.0
32
$50.0
32
45 45
1997
Charles A. Izzo president
11
Drake Construction Co. 1545 E. 18th St., Cleveland 44114 (216) 664-6500/www.drakeconstructionco.com
$20.3
$19.4
31
$15.4
42
45 45
1954
Steve Ciuni president
Source: Information is supplied by the companies unless footnoted. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. Individual lists and The Book of Lists are available to purchase at www.crainscleveland.com.
RESEARCHED BY Deborah W. Hillyer
Council: Committee should give group bigger say in future continued from PAGE 3
Mr. Greenspan, who represents Westlake and nearby communities, said he wants a more thorough review of how county government functions and how it might partner with other organizations to provide some services before looking for space for a new headquarters. “There’s very little that we do that private industry doesn’t do or couldn’t do,” Mr. Greenspan said. He said the discussion of building new versus retrofitting an existing building “is putting the cart before the horse.” Mr. Greenspan said he’d like to look at ideas such as using area banks to accept county property tax payments that now only can be made in person at the county administration building before the government makes decisions on how much space to occupy. Mr. FitzGerald said no decisions have been made on buying, leasing or building space for a new county headquarters, though he has stated in the past that vacating the current county administration building made sense, especially because he already was hearing expressions of interest in the building as a hotel site. The building is adjacent to the under-construction Cleveland Medical Mart & Convention Center, which is expected to open in the fall of 2013. In January, shortly after the new county government celebrated its first birthday, Allegro Realty Advisors Ltd., a local real estate firm, presented the county with a report that inventoried county office and warehouse space now in 66 properties. Allegro recommended the county keep or fix 44 of the buildings and divest 22 of them, including the current county
FILE PHOTO/STAN BULLARD
Cuyahoga County’s current administration building, which County Executive Ed FitzGerald said could be ripe for development due to its proximity to the Cleveland Medical Mart & Convention Center. administration building, for a net savings of $56 million. Mr. FitzGerald asked for the study last fall as part of the dramatic makeover that accompanied his election as the first county executive and the reduction in the size of the county’s staff that followed. Allegro also recommended a twoyear timeline, ending in 2014, to sell
and move the county offices. That short timeline would seem to preclude constructing a building, though Mr. Gallagher countered that he wouldn’t object to a temporary move while a new headquarters is built.
Sending a message Underlying these specific discus-
sions, though, was a belief that the administration was not treating the council as an equal partner in county government. At one point in the April 3 committee discussion, Mr. Gallagher said, “The charter dictates we’re part of this.” Later, Mr. Gallagher said he thought the administration had been “pretty open with us and I
appreciate that. But when we bring up things like building new, the door seems to shut. There could be a reason for that, but I’d like to hear it.” Mr. Greenspan was less gracious. “We need to be engaged in the front end of the process,” he said, when asked if there was a dispute brewing between him and the administration. “We are a co-equal branch (of government) with the executive. So what you’re sensing is me saying, ‘Don’t come to us afterward; we want to be part of the process up front.’” Council President C. Ellen Connally, herself a Democrat, would not point a finger at the administration, but she acknowledged the creation of the ad hoc committee was an effort to assert council’s role before the real estate process went any further. “If you look at the charter, (council has) absolute control of buying and selling (real estate); that’s why we formed this committee,” the Shaker Square resident said in an interview last Wednesday, April 18, when asked if the administration was moving ahead without consulting council. “So that won’t happen any more.” Mr. FitzGerald said from his experience as both a councilman and mayor of Lakewood that he understands the political jockeying. “I’m not surprised at that when I hear it,” he said. “The typical complaint of council is usually that they weren’t included in enough decisionmaking on administrative matters and the typical complaint of an executive is that a council is getting into administrative matters that that they don’t have jurisdiction over or it’s not their appropriate role.” ■
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CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
BRIGHT SPOTS Bright Spots is a periodic feature in Crain’s featuring positive business developments that have flown under the radar. To submit information for Bright Spots, email Scott Suttell at ssuttell@crain.com. ■ DDR Corp. a real estate investment trust specializing in shopping centers, said it has expanded Set Up Shop, its leasing program for small businesses. Beachwood-based DDR piloted Set Up Shop in Atlanta earlier this year. Based on the results of the Atlanta test, the program has been expanded to 24 of the company’s shopping centers in Florida, with an emphasis on the Orlando and Tampa markets. The company describes Set Up Shop as “a creative approach to small-shop leasing in which qualified entrepreneurs receive flexible terms designed to limit some of the barriers associated with starting a business.” The program allows DDR to reduce asset-level expenses and increase recovery rates and operating income, while at the same time enhancing the merchandise mix of its assets with local businesses. “Set Up Shop is an aggressive initiative to generate activity in targeted small-shop units in the DDR portfolio without putting capital at risk,” said Paul Freddo, senior executive vice president of leasing and development for DDR. “Of the 100 units allocated to this program in Atlanta, we have generated hundreds of leads, ten fully executed leases and a dozen others in various stages of negotiation in just two months.” Set Up Shop spaces have included consumer services, exercise facilities and clothing and accessory merchants, Mr. Freddo said. As it did in Atlanta, DDR is part-
nering with SCORE, a national nonprofit association dedicated to educating entrepreneurs, to serve as a resource for Set Up Shop tenants in Florida. ■ Albert Green, CEO of Kent Displays, an advanced manufacturer of liquid crystal displays, has been chosen as one of seven new members for The Manufacturing Council, a private-sector committee that directly advises U.S. Secretary of Commerce John Bryson. The council, which is made up of 25 private-sector members, was created in 2004 to act as a direct conduit between the U.S. Department of Commerce and the manufacturing sector. Its goal is to promote partnership across industry sectors to improve the global manufacturing competitiveness of the United States. In a statement, Mr. Bryson said Dr. Green “brings valuable experience and will play an important role in our ability to promote innovation, economic growth, and continue to level the playing field for American manufacturing firms and workers.” Dr. Green is no stranger to providing guidance to the government. He has been an adviser to President Barack Obama’s Export Council, served as a business delegation member for the 2011 U.S. Commerce Trade Mission to India and was a participant in the export session of President Obama’s Winning the Future Small Business Forum in 2011. Dr. Green has been CEO of Kent Displays since 2007. Improv Electronics, a consumer products subsidiary of Kent Displays, makes the company’s first consumer product, the Boogie Board eWriter. ■ Absolute Haitian Corp., the U.S. affiliate of Chinese injection molding machine maker Ningbo Haitian Machinery Co., is opening
PolyOne expects Asia boost from acquiring Berea outfit By LAUREN HILGERS Plastics News
SHANGHAI — After a year of acquisitions and leadership changes, PolyOne Corp. is pursuing a growth strategy in Asia that will build on new relationships as the polymer producer based in Avon Lake aims to beat gross domestic product growth in the region. A key part of the strategy involves last year’s acquisition of ColorMatrix, a Berea-based liquid colorants specialist that has had a plant in Suzhou, China, since 2008. “The global overlap of PolyOne and ColorMatrix is less than 5%,” said Mark Crist, the vice president of Asia at PolyOne. “Think of the opportunities for cross-selling.” Mr. Crist was interviewed last week at Chinaplas 2012 in Shanghai. PolyOne hopes to build off the new customers that ColorMatrix is bringing in, offering them a wider range of products. “If I have a customer with an already-established supply train and trust I can then offer them other kinds of polymers solutions,” Mr. Crist said. “We can increase our presence.” The ColorMatrix acquisition was
completed at the end of 2011, representing an investment of $486 million. Mr. Crist said gross domestic product growth in China is expected to reach 8.5% in 2012. He wants to expand PolyOne’s sales in the country by multiples of the GDP number. Mr. Crist himself is part of PolyOne’s recent leadership reshuffle. He arrived in Shanghai a few months ago, taking over from Willie Chien. PolyOne arrived at Chinaplas, held April 18-21, with a new line of thermally conductive grades for use in LED lighting. The material, called Therma-Tech, can be used in place of metal heat sinks to enable parts consolidation and better management of hot spots, resulting in longer LED lifetimes. ColorMatrix was featuring a series of PET reheat additives at the show. While the two brands were operating separate booths at the exhibition, Mr. Crist said they planned to exhibit together in the future. ■ Lauren Hilgers is a correspondent for Plastics News, a sister publication of Crain’s Cleveland Business.
a technical center in Parma to handle increased business and build stronger links with auto parts manufacturing companies in the region. The 20,000-square-foot tech center will house aftermarket support functions, including customer training, field service and aftermarket parts, along with a warehouse for machine demonstration and mold trials, according to Worcester, Mass.-based Absolute Haitian. The Parma center will complement an existing technical center the company has in Chicago but will have more of a focus on aftermarket support. ■ Mental Floss, a fast-growing magazine with business operations in Geauga County, was named “Best Virtual Store” in the min2012 Best of the Web awards by Minonline.com, a publication covering the media industry. “Many magazine websites let you ‘shop the look,’ but the Mental Floss Store lets readers of its quirky ‘knowledge junky’ content also shop the sensibility,” Minonline.com said. “Where else do you find pet play toys in the shape of phony mustaches, lips and tongues? Or drinking cups with animal nose images? Or an ‘Einstein Relativity Watch’ that proves time is relative? Or medieval weapon push-pins?” The Mental Floss store “is not only curating great items from around the world that reflect readers’ fun and informed mindset, but the brand also expresses itself in its own line of T-shirts and games that extend print and digital editorial into the world of tangible goods,” according to Minonline.com. “This is one e-commerce project that is not only integrated into the digital business model but is also part of a larger content strategy as well.”
17
CSU: More debt? No sweat, president says continued from PAGE 1
State students could enroll as medical students at NEOMED. “They’ll be learning how to work in a team, so we can provide for them from day one the experience needed to become better health care providers,” NEOMED president Dr. Jay Gershen said about the center. The new building is expected to serve as much-needed swing space for Cleveland State and should allow the university to chip away at its deferred maintenance needs, which over the next 10 years could cost the university as much as $265 million, according to estimates by Sightlines LLC, a Connecticut-based consulting firm. “Hopefully, a number of moves will take some of the properties and high-ticket items off that list,” Dr. Berkman said. For example, Dr. Berkman said, the Chester Annex, which houses some of the university’s health care programs, would cost as much as $40 million to renovate. It instead could be torn down because of the space available at the new building. Still, about $26 million of the proceeds from a bond sale estimated at $71 million will be reserved to tackle some of the deferred maintenance needs on campus, according to Stephanie McHenry, the university’s vice president of business affairs and finance. The university plans to go to market this fall with those bonds.
CSU: We can handle it The Ohio Board of Regents, which assigns a score determining the fiscal health of each public college and university, this month
assigned Cleveland State one of the lowest scores among four-year universities — a 3.4 out of 5 for fiscal 2011, which ended last June 30. As of that date, the university carried $217.4 million in long-term plant debt. The only four-year institution more hard-pressed than Cleveland State, according to the regents, is Youngstown State University, which carries a score of 2.3 out of 5. Cleveland State and Youngstown State were the only public universities to see their scores slip from fiscal 2010 to fiscal 2011. Dr. Berkman attributed a throng of capital investments undertaken by Cleveland State since his arrival in 2009, such as the $44 million student center that opened in fall of 2010, as the reason for the lowered score. However, the university is looking to refinance as much as $30 million of its existing debt, which Dr. Berkman said could nudge that score upward. “I would not do anything and the board would not do anything to imperil the fiscal stability of the university,” Dr. Berkman said. Also, Ms. McHenry said Cleveland State is “well above any danger zones” in terms of its debt load. State law mandates any institution with a score of 1.75 or lower for two consecutive years would be placed on “fiscal watch.” “The general sense we’ve gotten from the professionals we’ve been working with is that there is some capacity for additional debt,” Ms. McHenry said. “No one has told us outright you shouldn’t borrow anymore.” ■
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CRAIN’S CLEVELAND BUSINESS
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Brokers: Alleged inconsistency at issue plaintiffs’ suit.
continued from PAGE 1
the 2009-10 Cleveland Cavaliers season, LeBron James’ last in Cleveland. Amazing Tickets owner Mark Klang said in an interview last Tuesday, April 17, that he forwarded the subpoena on to his company’s attorneys, who responded to the city by saying that the company, as stated in the ticket brokers’ lawsuit, “does not attend or host the events,” and thus shouldn’t be subject to the tax. Mr. Klang said months went by until the company heard back from the city — in late September 2011, when the city asked Cleveland Municipal Court to enforce its previous subpoena with a new twist: The city “unilaterally mandated 8% of the amount paid in excess of the established ‘face value’ of the ticket be paid as a tax,” according to the
Equal opportunity Mr. Klang said his issue is not with paying the tax, if it’s deemed lawful. Instead, his complaint is related to what he sees as the city’s apparent selective enforcement of the tax. Mr. Klang and other ticket brokers obtain tickets in any number of ways, including buying them from clients. However, just like Joe Schmoe from Parma, they also obtain tickets by buying season ticket packages through each of the city’s three professional sports teams. In the latter scenario, they are members of a group of approximately 50,000-plus season ticket holders of the three teams combined. And therein lies Mr. Klang’s problem: If the city isn’t trying to enforce
the above-face-value tax on every one of those tens of thousands of season ticket holders who sell their seats, how can it enforce it on three companies alone? Mr. Klang uses this example: He said his wife and cousin are Browns season ticket holders who have sold tickets on the team’s secondary exchange above face value, and they have not been contacted by the city to pay the 8% tax on sales above face value. Cleveland officials declined to comment when contacted by Crain’s, except for a prepared statement from city law director Barbara Langhenry that read, “The City of Cleveland enforces its Admissions Tax ordinances fairly and uniformly on entities with a tax liability and will address these claims in the appropriate manner and venue.”
APRIL 23 - 29, 2012
According to Cleveland Municipal Court records, the city also filed a motion last September against Flash Seats LLC, the Cleveland Cavaliers’ secondary market technology owned by Dan Gilbert’s Veritix. The court, though, dismissed that motion a month later. Municipal court records don’t appear to show any filings against the Cleveland Indians or Cleveland Browns. And that inconsistency is Mr. Klang’s biggest issue. “I have no issue with competition,” Mr. Klang said. “But this isn’t competition. All of the other Internet sites, all of those season ticket holders, the teams’ secondary sites … aren’t going to be taxed. “The city can find Amazing Tickets,” he said. “But our competition is truly impossible to find.”
Cooper who has an extensive background in sports law, said the city has the right to enforce ordinances against some or a few violators as opposed to all. He compared it to a speeding ticket: If you’re going 42 in a 35-miles-perhour zone, and another driver is going 45, and you get the ticket but the other driver doesn’t, that isn’t all that fair, either. But it doesn’t mean the ticket you received is invalid. However, Mr. Juliano said the plaintiffs’ attorneys, of Leonard F. Carr Co. LPA in Mayfield Heights, filed in federal court to prove a constitutional violation of the 14th amendment, which provides for equal protection. Bryan Carr, the plaintiffs’ attorney, in an interview last Friday, April 20, said the city’s admission tax ordinance “is fraught with problems.” “The city is asking for confidential information based on a presumption or belief,” Mr. Carr said. “It’s an invasion of privacy.” ■
Life isn’t fair Jim Juliano, a member of the management committee at Cleveland law firm Nicola, Gudbranson &
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• 4,000 square feet • 4.5 secluded acres • 7 car garage • Mountain top views • House and property completely rebuilt -2012 • Hardwood floors • Master suite
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Copy Deadline: Wednesdays @ 2:00 p.m. All Ads Pre-Paid: Check or Credit Card BUSINESS SERVICES
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Crain’s Cleveland Business Online Property Search Powered by LoopNet, No. 1 in Commercial Real Estate online Looking for property? Search thousands of local listings Selling or leasing a property? Get your property featured through Crain’s www.CrainsCleveland.com/LoopNet
List your Industrial, commercial or Retail Space Here! Crain’s Cleveland Business’ classifieds will help you fill that space.
Contact Toni Coleman at 216.522-1383 TColeman@Crain.com
Equipment Leasing • Business Credit Lines • Working Capital Loans • Factoring • Commercial Mortgages Start ups and past credit problems considered.
PUBLIC NOTICE The Cuyahoga County Department of Public Safety and Justice Services is now soliciting proposals from firms interested in providing Developer and Programmer Services to Cuyahoga County. Copies of the qualification specifications are available from the Office of Procurement and Diversity. Vendors are also encouraged to register with the County’s BuySpeed Vendor Registration Program on the Internet at www.opd.cuyahogacounty.us to receive notices of future bid opportunities. [Phone: (216) 443-7200] Prospective bidders must be registered with the Cuyahoga County Inspector General. Information can be accessed on the Internet at www.inspectorgeneral.cuyahogacounty.us Completed proposals must be submitted to the Office of Procurement and Diversity, County Administration Building, Room 110, 1219 Ontario Street, Cleveland, Ohio, 44113 no later than 11:00 a.m. on May 8, 2012. Lenora M. Lockett, Director Office of Procurement & Diversity Publish in Crain’s Cleveland Business on April 23, 2012 This notice may also be viewed at the following Cuyahoga County Internet Web Site: www.opd.cuyahogacounty.us
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Crain’s Executive Recruiter Local public company seeking experienced banker to handle corporate finance. Qualifications: Bach. Degree, 5 years experience in financial leadership role.
Send Resume to: BronwynGwen@gmail.com 440-346-1824
POSITION WANTED Retiring real estate professional seeks part time opportunity on a regular or project basis. 30 years management and financial responsibility with all types of commercial properties. Strong financial, HR, maintenance and people skills. Additional experience includes retail, executive recruiting and consulting. College grad, veteran, Ohio license, Notary, former CPM. bobgeuder@gmail.com
216.903.0732
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APRIL 23 - 29, 2012
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
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THEINSIDER
THEWEEK APRIL 16 - 22 The big story: The Westfield Group will sell Westfield SouthPark Mall in Strongsville as part of a plan to divest eight “non-core” U.S. shopping centers. Starwood Capital Group of Greenwich, Conn., is buying the majority interest in seven of the centers, including SouthPark, for more than $1 billion. An eighth center will be sold in a separate transaction. SouthPark, at 1.657 million square feet, is the largest of the seven properties Starwood is buying. Westfield bought the mall in 2002 from the Richard E. Jacobs Group Inc. Looking up: Local information technology companies did particularly well during the fourth quarter of 2011, according to a survey from the Northeast Ohio Software Association. A record 79% of the IT firms that responded to NEOSA’s fourth-quarter survey said they had a “good” or “very good” quarter, up from 66% in the third quarter. The previous high for the 5year-old survey was 71%, recorded during the fourth quarter of 2010. New approach: Merchandise Mart Properties named former McKinsey & Co. executive Jim Bennett as senior vice president at the Cleveland Medical Mart & Convention Center. MMPI also announced the establishment of an Industry Advisory Board to provide what it termed “a medical industry and customer perspective” on the activities and tenants that would make the medical mart and Bennett convention center attractive to permanent showroom tenants as well as meetings and trade shows related to health care. Also, Brian Milner, an executive with two decades of facilities management experience, was named director of operations.
REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS
The best banks at aiding Legal Aid
business because of this within the legal community,” Ms. Lloyd said of Key and PNC. — Michelle Park
■ Want to know which banks are paying more interest and attention to the Legal Aid cause across the state? So did the Ohio Legal Assistance Foundation. Cleveland-based KeyBank and Pittsburghbased PNC Bank comprise the first class of “prime partners” in a program begun this year to reward and highlight those banks that are doing more to assist the state’s legal aid programs. The Legal Aid Society, of which there are six branches in Ohio, provides free civil legal assistance to low-income people. A main source of its support is interest earned on money lawyers put into trust accounts — a revenue source that has dropped more than 70% as interest rates have plummeted. The inaugural “prime partners” class was chosen based on the interest rates they pay on such trust accounts and their donations and service to Legal Aid, including board membership, said Angela Lloyd, executive director of the Ohio Legal Assistance Foundation. The foundation distributes the interest dollars to the state’s regional Legal Aid branches and launched the Prime Partners Program in February. Other states have similar programs, though theirs are almost exclusively tied to interest rates, while Ohio’s takes into account other efforts, too, Ms. Lloyd said. Often, the banks that are recognized enjoy increased business as lawyers switch accounts to them, she noted. “We’re hoping that they see an increase in
Canton Charge score with fans
WHAT’S NEW
BEST OF THE BLOGS
An ounce of prevention: The two chairmen emeriti of Forest City Enterprises donated a combined $2 million to the Cleveland Clinic’s Wellness Institute to establish an endowed chair in preventive medicine. The gift from Sam and Maria Miller and Al and Audrey Ratner will support the research of Dr. Raul Seballos, vice chairman of the department of preventive medicine, who will be the first chair holder.
Moving on: The executive search team at Cleveland State University will be busy. Geoffrey Mearns, the university’s provost and senior vice president for academic affairs, was named the new president of Northern Kentucky University. He starts that job Aug. 1. Also, Robert Scherer, dean of Cleveland State’s Monte Ahuja College of Business, accepted a similar post at the University of Dallas. He begins his new role as dean of the University of Dallas’ College of Business on Aug. 1. Capital idea:
It’s a sign that the planned recapitalization of Central Federal Corp. has not generated the demand desired: The company announced that its board of directors intends to restructure the terms of the offering. That news came Wednesday, April 18, the day after the company’s rights offering, which had been extended a month, expired. Central Federal, the parent company of CFBank in Fairlawn, is trying to recapitalize itself by raising up to $30 million.
A helping hand: BVU: The Center for Nonprofit Excellence received a $400,000 grant from the John S. and James L. Knight Foundation to develop a program to prepare young professionals in Akron for service on nonprofit boards. BVU will train young professionals for nonprofit board positions and volunteer consulting and will match their skills and interests with local organizations. The Akron program will build on BVU’s successful volunteerism model in Cleveland.
THE COMPANY: Cequent Consumer Products Inc., Solon THE PRODUCT: TransRack Cargo Truck Rack Cequent Consumer Products Inc. in Solon, a maker of automotive aftermarket products, has unveiled the TransRack Cargo Truck Rack, which the company describes as a “one size fits all” solution for the pickup truck owner who transports long items that may not fit in a truck bed. Made of aircraft-grade aluminum, TransRack installs without tools. Eight double-lock clamps with stainless steel hardware hold the rack to the bed of the truck. Cequent said the rack has an 800-pound capacity and four movable load stops that make “carrying ladders, pipe, lumber or other long items a simple task.” Cequent said TransRack first was shown at the 2011 Automotive Aftermarket Products Expo. The company said TransRack will be available at retail stores in July and will have a manufacturer’s suggested retail price in the range of $350 to $400. For more information, visit www.Cequent ConsumerProducts.com. Send information about new products to managing editor Scott Suttell at ssuttell@crain .com.
■ The Cleveland Cavaliers are happy with the on-court results of the first season of the NBA Development League Canton Charge, and the team didn’t fare too badly in the stands, either. The Charge, who played Saturday and perhaps Sunday in the second round of the NBADL playoffs, averaged 2,722 fans at the Canton Civic Center in their first year, which puts the team in the middle of the pack in the NBADL. The Cavs in July announced their purchase of the NBADL’s New Mexico Thunderbirds and moved them to Canton. The Cavs for the past three years had shared the Erie Bayhawks with the Toronto Raptors, but wanted more control over personnel development, and thus now operate their own team. — Joel Hammond
More organized mayhem is at hand ■ We’re nice people here in Northeast Ohio — honest! We just like to make robots that kill each other. The Independence-based National Tooling and Machining Association announced that its National Robotics League will hold its championships on May 5-6 at Circle Centre Mall in Indianapolis. Although this year’s event is in Indiana, the association is based
here and some Ohio schools will compete. A total of 17 high school and college teams qualified for the event, including Ohio’s Centerville High School, Springboro High School and the Dayton and Celina branches of Wright State University. And, of course, there’s still the Robobots competition in Kirtland, where 24 teams sponsored by area manufacturers will fight it out April 28 in a separate competition. Manufacturers say these programs help attract young people to work in tooling and machining — but we happen to know that most manufacturers are just kids at heart, who also enjoy watching sparks fly as much as the students themselves. — Dan Shingler
When it comes to pet names, we favor Bud Light’s ‘Wego’ ■ Michael A. Chisnell Jr.’s dog is named CODA and his cat is named ERISA. If you, like Mr. Chisnell, work in the retirement field, you’ll know why Mr. Chisnell concedes that he’s a bit of a geek. CODA is the term for cash or deferred arrangement, such as a 401(k), and ERISA is the acronym for the Employee Retirement Income Security Act of 1974. They ended up pet names after Mr. Chisnell’s wife, Stacy, vetoed Mr. Chisnell’s suggestion that ERISA would be a “great girl’s name” and CODA would be “a really tough boy’s name.” “I absolutely love my job; it’s truly a hobby,” said Mr. Chisnell, director of retirement services for Sequoia Financial Group LLC in Akron. “It’s who I am,” he added. “I guess I own the geekdom.” —Michelle Park
Excerpts from recent blog entries on CrainsCleveland.com.
They’re trying to help an IPO bloom
Forest City’s Atlantic Yards brings big change to Brooklyn
■ Cleveland law firm Baker & Hostetler LLP is helping Bloomin’ Brands Inc., owner of the Outback Steakhouse restaurant chain, raise $300 million in an initial public offering to help pay down debt. Bloomberg reported that Baker & Hostetler represents Bloomin’ in the IPO, while Ropes & Gray LLP represents the lead underwriters, Bank of America Corp., Morgan Stanley and JPMorgan Chase & Co. Working on the deal from the Baker & Hostetler side are partners John Gherlein, Janet Spreen, Suzanne Hanselman, Peter Van Euwen and Edward Ptaszek, as well as associates Katie O’Connor, John Harrington and Matthew Oliver. All are in the firm’s Cleveland office.
■ The controversial, Forest City-led Atlantic Yards development in Brooklyn, N.Y., “has already done the very thing that critics feared and supporters promoted: transform surrounding neighborhoods prized for their streets of tree-lined brownstones and lowkey living.” So said The New York Times in a story about a development project that promised no less than “to reshape the heart of Brooklyn.” Shops along Flatbush Avenue south of the under-construction Barclays Center, which next season will be home to the Brooklyn Nets, “that for generations sold unglamorous products like hardware, paint, plumbing supplies, prescription drugs, even artificial limbs, are seeing new businesses pop up that sell highheel shoes for $3,500 a pair, revealing party dresses, exotic cheeses and, of course, high-priced martinis,” The Times said. And fancy restaurants are popping up everywhere. For Forest City Ratner, a subsidiary of Cleveland-based Forest City Enterprises, “the changes are evidence that the arena has already met its goal of transforming a dreary section of Brooklyn,” the newspaper noted. Some residents, though, worry about the impact of congestion from the arena, as well as the environmental impact of rapid growth and the impact of rising rents on longtime businesses. “People who live in Prospect Heights still need to get their clothes dry cleaned and shoes repaired,” one local activist said.
Not always a pretty picture ■ A Paris museum is highlighting the career of famed American cartoonist R. Crumb, and the exhibition includes some of his early work at American Greetings Corp. The New York Times reported that “Crumb, From the Underground to Genesis,” at the Musée d’Art Moderne, covers five decades of his work. “The exhibition, on view through Aug. 19, brings together more than 700 original drawings and more than 200 underground magazines, many from Mr. Crumb’s private collection,” The Times reported. It opens with greeting cards he created for American Greetings in Cleveland, The Times noted. There also are his “psychedelic Zap Comix; his graphic renderings of sex, obscenity and drug use; and intimate photos, including one of Mr. Crumb sitting in a wicker chair in his living room and strumming a banjo.”
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THE TRADITION CONTINUES FRIDAY, MAY 11, 2012 5:30–7:30 P.M. presented by parker
· STUDENT CENTER BALLROOM
hannifin corporation Philanthropist and alumnus Don Washkewicz, BSME '72, will be honored with the President's Medal. Mr. Washkewicz is the Chairman, Chief Executive Officer and President of Parker Hannifin Corporation.
Radiance, a business casual, cocktail / hors d’oeuvres reception with a short program, is Cleveland State University's signature event in support of student scholarships.
For information on sponsorships and tickets, call 216.875.9855 or visit www.csuohio.edu/radiance.
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*