Crain's Cleveland Business

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VOL. 37, NO. 27

JULY 4 - 10, 2016

CLEVELAND BUSINESS

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z JULY 4 - 10, 2016 z CRAIN’S CLEVELAND BUSINESS

Health sytems have cut down on diversions By working together, hospitals are reducing number of times ambulances are redirected

By LYDIA COUTRE lcoutre@crain.com @LydiaCoutre

Hospitals in Cuyahoga County locked arms earlier this year in an effort to cut down on the nearly 1,700 hours area emergency departments spent pointing away ambulances last year.

In total, that’s about 70 days of hospitals on “diversion status,” a communication tool that lets ambulance teams know the emergency department doesn’t have the capabilities to care for a patient at that specific time — be that due to the volume of patients or the number of available staff members. Ambulances drive to a different hospital as long as that doesn’t put the patient at risk. They still go to the nearest hospital that can care for patients with urgent needs, such as a stroke or cardiac event, regardless of diversion status.

So far, hospitals have drastically cut back on time spent on that status since February, when Cleveland Clinic, MetroHealth, St. Vincent’s Charity Medical Center and University Hospitals agreed to stop going on diversion.

“It was really an act of faith for everybody to say, ‘OK, we understand, and we’re going to give this a try,’ ” said Dr. Bob Wyllie, chief medical operations officer for the Clinic.

Between Feb. 15 and June 30, area hospitals have spent about 75 hours on diversion — a fraction of the 420 hours logged in the like timeframe last year, according to online data from Cuyahoga Emergency Com-

munications System (CECOMS), which maintains and tracks the status of hospitals’ capability to receive patients transported by EMS. Though there have been a few diversions in the region since February, the systems’ main campus emergency departments have remained open with no diversions since Feb. 15.

Surges Overwhelmed emergency departments on diversion status would create a “cascading event,” Wyllie said, in which the other departments operating normally would see the rush of patients.

It put pressure on staff and wasn’t the best for patients, officials said.

Without interoperability of electronic medical records between health systems, a patient visiting a different hospital than where they normally see their doctors interrupts the continuity of care, said Dr. Jeffrey Luk, director of prehospital and disaster medicine at University Hospitals Case Medical Center.

The hospital a patient then arrives at might not have their history, medications list, past tests and lab results. The hospital can, of course, request this information, but it can take some time to figure out that patient’s history, Luk said.

“I think, from a practitioner point of view, we’re very happy to take care of the patients that have chosen UH to be their medical home and to see our doctors there,” he said. “So it definitely creates more professional satisfaction for us, as I’m sure that it’s done for other doctors in the other systems as well.”

“It was really an act of faith for everybody to say, ‘OK, we understand, and we’re going to give this a try.’ ”

more minor issues are fast-tracked to make room — accomplished that.

Dr. Carla O’Day, St. Vincent’s director of emergency services, has seen surges when other emergency departments were receiving limited patients.

“I could without ever knowing what was happening in the community, know when somebody was going on diversion, because all of the sudden we’d get a big influx of EMS,” O’Day said.

Those surges have stopped since February, she said.

— Dr. Bob Wyllie, chief medical operations officer for the Cleveland Clinic

Making adjustments

Wyllie of the Clinic said ending diversions wouldn’t have been possible without everyone coming together to stop the cascading events.

“It only works if everybody takes their share,” he said.

Often, when a hospital goes on diversion, it’s a sign the entire hospital is full. Sometimes, it’s due to surges and overload, said Bev Lozar, St. Vincent’s chief nursing executive.

“But I have found that very often it’s because the whole hospital is kind of jammed up and we can’t get patients out of the emergency department to the upstairs floors,” she said.

St. Vincent hasn’t gone on diversion in at least three years after a consultant helped it streamline the processes and flow of patients in the ED. Though eliminating diversions wasn’t the specific goal, the new workflow — in which patients are triaged and registered bedside and

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For years, the Clinic “philosophically” had a zero diversion policy, Wyllie said, and had only gone on diversion a couple of times a year for the past few years. The Clinic logged about 10 hours on diversion last year, according to CECOMS data.

The new policy didn’t require any major operational changes at UH Case Medical Center, Luk said, but primarily just meant more education and coordination. Staff needed to know to accept all patients and direct them to where they should be, depending on if they needed high or low acuity care.

If the hospital faces a particularly busy day that would have meant switching to diversion a year ago, staff responds by checking for available beds in the hospital, seeing who can be discharged and moving people to their next step as quickly as possible, Luk said.

In 2015, UH’s main campus emergency room was on diversion for 568 hours, according to CECOMS data.

Even though UH Case has seen on average an additional 10 patients a day compared with last year, it has been able to maintain no diversion, Luk said, thanks to staff working toward efficiencies.

Dr. Bernard Boulanger, MetroHealth executive vice president and chief clinical officer, said MetroHealth’s main campus emergency department, which had 446 hours on diversion last year, doesn’t see the overwhelmingly busy days it used to thanks to other access points, from the new EDs in Parma and Cleveland Heights to MetroExpressCare, where patients can seek urgent care services.

MetroHealth’s emergency department opening in Brecksville later this year, and the Critical Care Pavilion slated to open July 12, also will help ease the volumes.

“Having the other hospitals not on divert helps each of us,” said Boulanger. “There’s no wavering on this. We remain committed to the initiative that began in February.”

Once the hospitals and Cleveland are through the busy weeks around the Republican National Convention, Wyllie said meetings will continue to fine-tune the hospitals’ nodiversion plan.

After all, it’s the best thing for the patients, Wyllie said, and the responsibility of the hospitals.

“We look at diversion as a failure on our part to meet the community needs,” Lozar said. “We’re here to serve our community. When we have to close our doors to ambulances, then we’re not doing a great job of serving that need. So it takes all of us working together.”

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 3

Dealer Tire’s quiet billion-dollar business

By CHUCK SODER csoder@crain.com @ChuckSoder

If you don’t know who Dealer Tire is, don’t feel bad.

Scott and Dean Mueller have spent the past 14 years turning a small tire distribution company into a business that generates more than a billion dollars in annual revenue.

But they’ve been really, really quiet about how Dealer Tire got so big, so fast. Until now.

The Mueller brothers took the rare step of making a public appearance last week to kick off a construction project that will turn all four floors of the 99-year-old Victory Center building into Dealer Tire’s new headquarters. The company signed a 20-year lease with Victory Midtown LLC, the owner of the Euclid Avenue building, which is about a mile east of the company’s current office on Chester Avenue.

But before the Mueller brothers picked up their pristine shovels to ceremonially launch the project — which also will include a new parking garage on the south side of the property — they sat down with Crain’s Cleveland Business to talk about Dealer Tire’s past, present and future.

They’ve been turning down interviews with this publication and other media outlets for years. And there was a reason for that, according to Dean Mueller, Dealer Tire’s president. “We thought we were on to a good idea. The (automakers) knew who we were. The dealers knew who we were. ‌ We wanted to make sure our competitors weren’t quite sure who we were until it was too late,â€? he said.

These days, however, Dealer Tire isn’t quite so worried about getting

overpowered by larger competitors.

After all, the company employs 1,100 people, including roughly 450 in Northeast Ohio.

Those numbers are on the rise.

Dealer Tire has hired 200 people over the past three years. Plus, the company has promised to hire at least 100 more local employees over the next three years, given that the move is being funded in part by public money.

That includes $8 million in financing, mostly loans, from the city and Cuyahoga County, undisclosed incentives from JobsOhio and more than $11 million in federal and state historic preservation tax credits.

Hence the need for the new 166,000-square-foot headquarters and the parking garage, which will contain 650 spaces. The company also is in the processing of buying the vacant Triangle Stamping Building, which is on the other side of East 70th Street.

The company’s radio silence has in some ways made recruiting difficult, which is a big reason why Dealer Tire is coming out of its shell, according to CEO Scott Mueller. Even people who know Scott and Dean from Mueller Tire & Brake — the retail tire business their grandfather started in 1918 — days don’t always know what they’re up to these days, he added. “People ask us, ‘How’s retirement?’ Or ‘Do you still have the retail stores?’ They don’t really know what Dealer Tire is,� he said.

Thank you, Mercedes OK, so what is Dealer Tire? In short, it’s one of the largest distributors of tires and light vehicle maintenance products — think brake pads and wiper blades — in the United States. It serves more than 10,000

brothers started working for their family’s retail tire business.

That started to change toward the end of the decade, when Japanese automakers launched Lexus, Acura and Infiniti — luxury brands that “had a different attitude� toward retaining customers at the dealership, Dean Mueller said.

Thus, Mueller Tire & Brake saw an opportunity to expand sales to dealerships, which had been a small part of the business. Its big break came in 1998, when the Mueller brothers visited the headquarters of MercedesBenz USA in Montvale, N.J. The Mercedes executives didn’t even bring business cards, so Dean figured it would be a short meeting.

It wasn’t.

A month later, they had a national contract with Mercedes. Then “doors started opening,� he said. “Toyota, BMW, all these different guys were looking at what we were doing,� he said.

Scott, left, and Dean Mueller lead Dealer Tire. (Contributed photo)

“People ask us, ‘How’s retirement?’ Or ‘Do you still have the retail stores?’ They don’t really know what Dealer Tire is.� — Scott Mueller, Dealer Tire CEO

dealerships from 43 distribution centers in the United States and Canada, including one in Strongsville.

Granted, calling the company a “distributor� is a little simplistic. In some ways, Dealer Tire is like a software company, developing tools that help its customers inspect, select and sell more tires. Its marketing department often operates like a marketing agency that serves car dealers. And Scott Mueller noted that the company sometimes resembles a consulting firm that helps dealers figure out how to act more like retailers.

The idea of dealers selling tires wasn’t all that big in this country back in the 1980s, when the Mueller

If you can’t beat ’em ‌ Mueller Tire formed the Dealer Tire brand in 1999. It became an independent business when the Muellers sold the retail business, which consisted of 19 stores in Ohio, to Tire Kingdom in 2002.

Why focus on the dealership business? For one, the Muellers realized that dealers had a few strengths, such as a built-in customer base and technicians with deeper knowledge about the vehicles on which they work. If they learned the retail business, Mueller Tire could be in trouble. “If you applied what we knew as a retailer to the service drive of a car dealership, they could sell tires. It was pretty simple,� Dean Mueller said.

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z JULY 4 - 10, 2016 z CRAIN’S CLEVELAND BUSINESS

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There’s an extreme beer scene ready to pour into Northeast Ohio.

Gov. John Kasich recently popped the cap on laws restricting the sale of beers stronger than 12% alcohol by volume in Ohio. Since then, local brewers have been quick to take advantage, with many preparing their first high-alcohol beers that should be ready for taps later this summer.

Sam McNulty, owner of Market Garden Brewery and Nano Brew Cleveland, said that while it isn’t a change anyone expects to revolutionize the beer business here, it does allow brewers to quench consumer thirst for these specialty suds at a time when interest in craft beer is overflowing.

For businesses, that’s that key motivation.

Yet, for brewers themselves, it’s also a chance to flex their craft beer muscles. Some will want to try their hand at these extreme beers simply because now, they can.

“It’s like, why did I climb the mountain? Because it was there,” McNulty said.

Market Garden brewmaster Andy Tveekrem was eager to make his first high-gravity beer, McNulty said.

(Gravity refers to a beer’s density relative to water, which grows with the amount of dissolved sugars that are converted to alcohol.)

Just last week, they finished brewing what will be their first super-potent offering: a Belgian Quadrupel expected to reach an ABV of 18%.

The brew will also have a welcomed home at McNulty’s Bier Markt, which focuses on Belgian beers.

That beer, which will be served in a snifter with 5-ounce pours, will act as a litmus test for demand.

“This is definitely our test market beer,” McNulty said. “We’re going to see how our guests like it, what they think of it, what food it pairs well with.

But there will definitely be more down the road. We’ll just see how this one does and tweak it from there.”

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Ohio’s 12% ABV cap was established in 2002, said Acacia Perko, a lawyer with Reminger Co. and liaison for the Ohio Craft Brewers Association. Prior to that, the ABV limit was just 6%.

But in late May, Kasich signed off on HB 37, which removed the 12% limit. Several different versions of bills aimed at raising the cap preceded this one, but didn’t gain traction.

Now, those higher ABV beers will be permitted for sale in Ohio starting Aug. 31 (it takes 90 days from signing until the change officially goes into effect).

West Virginia is the only state bordering Ohio, and one of just a dozen in the country, that still has an ABV limit.

While there’s a niche market for

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Pat Daniels, brewer at Market Garden Brewery, checks on a Belgian Quadrupel style brew. At an ABV of 18%, the beer will be one of the brewery’s first exceptionally high-gravity offerings. (Contributed photo) high-gravity beers, which are obviously stronger and therefore much less quaffable than their less-potent counterparts, those consumers would just get their strong beers from elsewhere.

“Customers were just crossing the border and bringing these highgravity beers back to the state,” Perko said. “Besides this limiting their creativity, when brewers realized their customers really wanted this, they began to push for a change.”

Some brewers were known to simply skirt the prohibitive law anyway, Perko said. If a brew was supposed to come under the 12% ABV threshold but was actually a bit stronger, some would just serve it anyway.

Even though it’s not expected to bring a financial windfall to the beer industry — besides generally appealing to beer enthusiasts more than casual drinkers, high-ABV beer is more expensive and time consuming to make and the yields are lower, which translates to a higher tab for drinkers — it still lets bars, restaurants and retailers capture those sales in Ohio.

“Brewers definitely wouldn’t be investing time and efforts into this if they don’t think the market were ready to accept the demand,” Perko said.

Changing the ABV law was, in fact, a “hugely” consumer-driven issue, said Mary MacDonald, executive director of the Ohio Craft Brewers Association.

“No one is really counting on their whole business model being high ABV beers. But we’re still really excited they’ve raised the ABV,” MacDonald said. “It’s going to be good for brewers and consumers, and we’re excited to see where that takes us.”

Unkinking the craft beer hose Besides local brewers, big beer names seem to have their sights set on Ohio for distribution now that the law has been changed.

The Boston Beer Co., known for its flagship Samuel Adams brand, is one of those.

The company brews a line of highs Cleveland Bus sines ss Volume 37, Number 27 Crain’s (ISSN 0197-2375) is published weekly at 700 West St. Clair Ave., Suite 310, Cleveland, OH 441131230. Copyright © 2016 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 s Cleveland Bus sines ss, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877-824-9373.

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gravity beers called “Samuel Adams Utopias,” which have been available for years in other states and have reached ABV levels above 30%.

They’re described as rich, uncarbonated beers with wood, toffee, cocoa, raisin and maple aromas meant to be savored in two-ounce pours like a fine cognac or port.

“We can’t wait to bring drinkers in Ohio one of our most amazing beers, Samuel Adams Utopias,” said Samuel Adams brewer and founder Jim Koch in an email. “Now that the ABV limit has been lifted, we hope to offer this unique drinking experience to Ohioans in the near future.”

Ron Shea, founder of the 8month-old R. Shea Brewing in Akron, said he recently finished brewing a barley wine — a type of strong ale brewed like beer that uses honey as a fermentable adjunct to reach higher alcohol levels — that should come out around 15% ABV and will be called “Gravitation.”

“It’s definitely a technological thing,” Shea said. “How can I do this?

These beers are great to age. And how can I keep the yeast working? There are a lot of things to play around with.

That’s part of my motivation.”

Because the barley wines tend to lend themselves to barrel aging, he says it’s more likely to be bottled and sold, although it could potentially be on tap.

“Overall, it’s great for variety to keep one or two offerings of something over 12%,” Shea said. “This is what the consumer wants. When they get it, we will see how they feel about it.”

Overall, brewers here eagerly anticipate a thirst for the high-strength beer market.

“This is really exciting and could very well lead to a niche that we’re not even aware exists,” McNulty said. “Brewers in this state had one hand tied behind their back with this legislation, which has been pinching the craft beer hose. When you remove that, there’s going to be a surge of economic energy. And that can lead to great things.”

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 5

Seven Hills sale could lead TIRE to senior housing project

CONTINUED FROM PAGE 3

By STAN BULLARD sbullard@crain.com @CrainRltywriter

For a decade, Seven Hills, which is home to part of the Rockside Road office market, has readied zoning for a planned unit development. A recent $2.2 million sale of an abutting parcel positions the suburb to gain a second major project using the mixed-use zoning.

Akron-based FirstEnergy Corp., through FirstEnergy Properties LLC, on June 20 sold a 16-acre parcel to Glenn’s Landing LLC, a local investor group, according to Cuyahoga County land records. The parcel borders the west side of several office buildings, including Park Center Plaza and 6200 Oaktree, on the south side of Rockside. The land was separately held and retained after FirstEnergy in 2000 sold the former Centerior Energy Corp. headquarters to a group of investors who converted it to a multitenant office building.

Glenn’s Landing is pursuing a rezoning of the site to planned unit development, according to attorney William Mason, managing member of the investment group.

The former Cuyahoga County prosecutor said if Seven Hills adopts the proposed rezoning, Glenn’s Landing will sell the site to Propco Capital Trust LLC of Wayzata, Minn., which plans to construct a senior housing campus on the site incorporating independent living, assisted living and a memory care unit in a $50 million project.

The empty land that Glenn’s Landing bought borders on its west

side an undeveloped 60-acre parcel that LSB Seven Hills LLC has worked with Seven Hills to develop. Legislation to create a planned unit zoning district called “Rockside Crossings at Seven Hills” on June 13 received the second of three required approvals

by Seven Hills City Council.

Mason said Glenn’s Landing will seek the same planned unit zoning that Rockside Acres is pursuing. In a citywide vote, the suburb created the mixed-use zoning classification in 2006 to allow development of housing and commercial properties in a format similar to that of the Crocker Park project in Westlake.

The council now is filling in the blanks of the public vote with more detailed legislation. Matt Trafis, Seven Hills council president, said the council is “doing a little fine tuning” on the tabled planned unit development ordinance.

Trafis said he did not know the FirstEnergy property was on the market until after hearing recently that the Mason-led group plans to buy it. Trafis said the city would welcome both proposals.

LSB plans a development with firstfloor retail on Rockside Road with apartments on several levels above it as well as a senior citizen housing project to be developed by another group, Trafis said. LSB plans to add a total of 175 dwelling units to the site, according to an application for a wetlands management plan pending before the U.S. Army Corps of Engineers.

The suburb may have a stronger hand than usual in getting what it wants from both real estate development groups.

Trafis said the city owns a nearly 2-

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acre parcel at 4235 Rockside just west of Oak Tree Boulevard that could provide additional access to both developments. He said the site, purchased for $300,000, recently was appraised for $1 million. Trafis said Seven Hills city officials are deciding whether and how to offer the land for sale.

Although the Glenn’s Landing site does not front on Rockside Road, Mason said the property has an easement to allow it to add a road to Rockside. Glenn’s Landing also has the ability to add a road to Oaktree to create its project. Land records show that LSB Seven Hills has other parcels that would give its project access to Rockside Road Lloyd Chapman, a principal of Propco, did not return three calls from Crain’s Cleveland Business by Thursday, June 30.

Mason said he is one of six investors in Glenn’s Lending. He would not identify his partners.

LSB Seven Hills is no stranger to Rockside Road. The company was formed by Beck Hospitality Corp., the Cincinnati-based owner of the Holiday Inn on Rockside. LSB Seven Hills paid $2.5 million in 2015 for the parcel it owns near Crossview Road to Fifth Third Bank, land records show. The lender had taken control of the land to satisfy a loan to a prior owner, identified in land records as Atlantis Development Group.

Something missing from both proposed developments is office use.

David Browning, managing director of CBRE’s Cleveland office, said so much vacant office space remains on the Rockside Road corridor that additional multitenant office development is unlikely.

And sell tires they did. Dealer Tire spent its first six years in business adding new warehouses and building new partnerships with automakers — deals that allowed them to sell to individual dealerships.

Things got “a little dicey” for a brief period during the recession, he said, but the company never had to lay off employees. And through most of the downturn, it continued to hire, add warehouses and invest in technology.

It proved to be a turning point for the business. Dealers needed revenue, so Dealer Tire started coming up with new ways to help them find it, Scott Mueller said.

“They knew if they couldn’t sell cars, they had to service customers better,” he said.

That’s what pushed Dealer Tire to develop RightTurn.com, a website that helps drivers find tires that match both their vehicle and their driving style. The site then pairs them with dealers who can install those tires.

After testing RightTurn.com in Cleveland and Dallas, the company is beginning to market the site nationally.

The future and the past The company is experimenting with other technologies that could help dealers compete in a changing world. It’s currently trying to figure out how to harness data from cars.

It’s also starting to think about how it could help dealers get an edge as electric cars — and even autonomous cars — become more prevalent, Dean Mueller said.

“We have to figure out where we’re going to be in that world before it’s here,” he said.

It also has a handful of employees in China working to determine

whether Dealer Tire should work to expand in that country.

As far as the past is concerned, the company is OK with leaving some parts of it behind. Namely, its current headquarters — a series of attached warehouses that Scott Mueller described as a “bomb shelter” because of its lack of windows.

By contrast, natural light floods the new building, which has windows on almost every wall. The space also is much more open, which will allow Dealer Tire to build a more efficient, collaborative layout.

The art that covers the walls of the current headquarters will move to the new building. And the Muellers are adamant about holding on to the company’s culture as well, Scott Mueller said.

“When you grow so rapidly, it’s easy to lose site of where you came from,” he said.

Though Dealer Tire has had private equity investors since it spun off from Mueller Tire — today, New York-based Lindsey Goldberg currently owns an undisclosed portion of the business — it’s still a family company. Their father, Walter D. Mueller, still works for the company at age 88.

The brothers want to ensure that Dealer Tire doesn’t lose that family atmosphere. Thus, the company shares its financials with employees, measures employee engagement regularly and participates in community events like the Cleveland Corporate Challenge. Plus, the first floor of the new building is being designed with employees in mind: It will include a fitness center, a cafeteria and classrooms for the hundreds of training programs that Dealer Tire hosts each year.

Those kinds of efforts have helped the company retain employees for decades, Dean Mueller said.

“We’ve got employees from our retail days who’ve been here 25, 30 years,” he said.

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North Point and AECOM buildings added to market

By STAN BULLARD sbullard@crain.com @CrainRltywriter

Owners of two downtown Cleveland skyscrapers have joined the owner of 54-floor Key Center in the quest to sell properties while the commercial real estate market is hot and the city basks in a rare national spotlight as the host of the Republican National Convention and the Cavaliers winning the NBA title.

New on the market are North Point, the 19-story and five-story combination of buildings that house the Cleveland office of Jones Day and other tenants, and the AECOM Centre, a 21-story building that is home to the AECOM Technology Corp. engineering and architecture firm and others. Both buildings are on corners of East Ninth Street — North Point at Lakeside Avenue, and AECOM at St. Clair Avenue.

Equity Commonwealth, a Chicago-based real estate investment trust with famed realty investor Sam Zell as its chairman, is marketing North Point with three other buildings in the Midwest through Eastdil Secured. Miami-based Optima International is offering AECOM through CBRE Group Inc., according to marketing information obtained by Crain’s Cleveland Business and local real estate sources.

“The window to sell is open, and it only happens a few times a decade in Cleveland,” said Alec Pacella, managing partner of Beachwoodbased NAI Daus and a specialist in investment property sales. “Investors and lenders are willing to look in the Midwest again. For (owners) who have hung in there, now is the time to reap the reward.”

Vicki Maeder, a vice president at CBRE who specializes in investment sales, called it a coincidence that North Point has gone on the market at the same time as the Key Center office-hotel complex on Public Square. Key is being offered by Atlanta-based Columbia Property Trust, also a publicly traded REIT.

Both Equity and Columbia are selling local properties because of larger considerations, she said, as both are trying to streamline portfolios. Both also are represented by Eastdil through Stephen J. Livatidis, an Eastdil managing director, according to a marketing brochure. Livatidis did not return three calls to his Chicago office.

By contrast, AECOM Centre owner Optima appears to be seeking to sell the building after buying it when the commercial office market was weak due to the financial crisis and Great Recession, and subsequently boosting occupancy of the structure.

The move also follows the sale last year of the Union Trust Building, 925 Euclid Ave., by another Optima affiliate to Miami-based Hudson Holdings.

Timing is right The would-be sellers stand to benefit from downtown office rents starting to nudge upward.

Andrew Batson, research manager in the JLL brokerage’s Cleveland office, estimates asking rents downtown are up 1% this year over last.

He forecasts the city will shift from favoring tenants this year to a neutral market, where landlords and tenants negotiate from equal strength, in 2017.

“We’re finding investors are being attracted to the Midwest now because it does not have the volatility in rents of the coastal markets,” Batson said. “There’s a lower level of risk in the Midwest. Cleveland is also benefiting from the idea it’s becoming a convention city by hosting the Republican National Convention.

It’s like an international marketing campaign for Cleveland that is virtually priceless.”

While conventions benefit restaurants and hotels more than office buildings, Batson said, they add to the perception the city is a good place to invest.

Maeder agreed.

“The convention gives the city a positive spin,” she said. “We as Clevelanders are impressed by how

good the city looks now. People who have not seen Cleveland for 10 years are amazed when they visit again.”

However, she noted the bigger impact for the office market may be the widespread conversions of old office buildings to hotels and apartments that have taken obsolete buildings out of the office market.

Another factor that may help the properties sell is that there were arms-length sales of both Fifth Third Center, 600 Superior Ave., and Skylight Office Tower, 230 W. Huron Road, last year to Hertz Investment Group of Santa Monica, Calif. For five years prior to that, there only had been distressed or development-oriented sales of downtown office buildings.

Big numbers Any of these properties will trade for mega millions. Equity Commonwealth predecessor HRPT Properties Trust Inc. of Boston paid $114 million for North Point in 2008, according to Cuyahoga County land records.

Through Optima 1300 LLC, Optima paid $46.5 million in 2010 for AECOM, then called “Penton Media Center,” land records show.

North Point, which has 821,000 square feet of office space, is 77% leased, according to JLL’s just-issued annual Cleveland Skyline Report.

AECOM has 580,000 square feet of office space and is 70% leased, JLL reported. Asking rents at North Point range from $20 to $22 a square foot and AECOM’s rate is $18 a square foot, JLL said. Batson said taking rents tend to be about 10% less than asking rents.

Maeder said she is not involved in CBRE’s marketing of AECOM and refused to discuss the structure. David Browning, CBRE managing director, wouldn’t comment on a CBRE listing for AECOM. Equity Commonwealth did not return three calls. Optima did not return three calls, including one to Chaim Schochet, the Optima investment executive who handles its Cleveland properties.

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 7

Brexit isn’t inducing panic for local firms

By RACHEL ABBEY McCAFFERTY rmccafferty@crain.com @ramccafferty

The United Kingdom’s vote in favor of leaving the European Union initially took the market by surprise, sending stocks tumbling and the value of the pound crashing.

In the week since, the market seems to have stabilized, but uncertainty — and a strong dollar — remains. Both of those can be significant bumps in the road for U.S. businesses, especially manufacturers that do a lot of exporting. And there’s no indication of when that uncertainty will lift, as it could be quite a while before the so-called Brexit becomes reality.

Mark Sniderman, executive in residence at Case Western Reserve University’s Weatherhead School of Management, said he can’t think of anything like this in recent history, as the split “opens the door that’s been closed for a really, really long time.” The world has been moving to a more open global market, but this vote signals a small retreat from that approach.

Still, Sniderman thinks companies shouldn’t overreact. Instead, they

should examine their operations for risks, he said.

It sounds like that’s what companies in Northeast Ohio are doing, regardless of their exposure to the European market.

Electronic writing tablet maker Kent Displays Inc., for instance, doesn’t sell much directly to the UK, but CEO Albert Green said in an email that it will be watching the effects of the falling value of the pound.

On the other hand, the UK is an important market for Akron-based tiremaker Goodyear Tire and Rubber Co. But the wait-and-see approach will be the same, according to an email from Keith Price, director of national media relations and business communications.

North Canton-based ATM maker Diebold Inc. also said it was too early to know how Brexit could affect its business in the UK, but senior director of corporate communications Mike Jacobsen said in an email that the vote isn’t expected to affect its pending deal to buy German rival Wincor Nixdorf for $1.8 billion.

For advanced materials company Materion Corp. in Mayfield Heights, it’s too early to talk about how Brexit could affect exchange rates or reg-

3.95%

ulatory matters, said spokesman Patrick Carpenter. But the UK and Europe are significant markets for Materion in a few ways. Close to 40% of company revenue in 2015 came from international sales, primarily in Europe and Asia, and Materion has operations employing about 90 people in Europe.

Materion and Diebold are far from alone in watching and wondering what will happen to their overseas counterparts. David Silk, chairman emeritus of the local British American Chamber of Commerce, said there are a number of Ohio-based companies, like paintmaker Sherwin-Williams Co. and law firm Jones Day, both in Cleveland, with operations in the UK. And there are more than 500 UK subsidiaries in Ohio, employing about 20,000 to 30,000 Ohioans, he added.

One of the biggest potential problems for Northeast Ohio companies, especially manufacturers, is the affect the combination of a weak pound and a strong dollar could have on exports and imports.

In 2015, there was about $1.8 billion in exports of everything from aerospace components to chemicals from Ohio to the UK, Silk said. The

chamber helps facilitate trade between the U.S. and the UK, said Silk, who also is a partner with SGI Global Business Advisors LLC. The pain caused by a strong dollar is nothing new to U.S. manufacturers, which have been facing the effects of a strong dollar against foreign currencies in recent years.

Sniderman thinks there could even be a “third-party effect” where countries outside of the European Union, like Japan, could see their currency strengthen.

“It’s just one more issue manufacturers are having to face,” said Chad Moutray, chief economist for the National Association of Manufacturers in Washington, D.C. There had been signs that the manufacturing sector was stabilizing, he said, but the uncertainty caused by Brexit throws a “monkey wrench” into that progress. He does think the market drop immediately after the vote was due to overreaction, but that it will be something to monitor, especially as it relates to any renegotiated trade deals.

The market has already largely been on pause — aside from the strong automotive and building construction markets — because it’s an election year, when people tend to

sit on cash until they see who takes office, said Matt Hlavin, CEO of plastic injection molder Thogus in Avon Lake. Thogus was able to grow through the last recession, but it’s important to know what the financial implications of a global event like this are.

But it might not all be negative.

Sniderman said there may be a way for companies to turn this to their advantage, if they look to expand their supply chain and source components in the now less expensive UK. And Mekael Teshome, economist with Pittsburgh-based PNC Financial Services Group, thinks this could delay the Federal Reserve’s timeline for raising interest rates from the summer to December, keeping borrowing rates low.

Overall, Teshome said he believes the direct impact of Brexit on local companies will be limited, and that the negative indirect impacts, like a stronger U.S. dollar and weak trade, will just exacerbate problems that already existed. He thinks that with low interest rates, companies will be able to maintain a steady pace of growth, as most growth drivers right now are domestic anyway.

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z JULY 4 - 10, 2016 z CRAIN’S CLEVELAND BUSINESS

Opinion From the Publisher / Editor

Reeling in a well-earned retirement

Editorial

Talk it out A compromise reached last week between the city of Cleveland and the American Civil Liberties Union over security restrictions around the site of this month’s Republican National Convention should go a long way to ease concerns both about the safety of the event and the city’s commitment to free expression.

Those who plan to protest, and the security forces who will be responsible for keeping the peace during the July 18-21 convention, can learn a lot from the level-headed manner in which Cleveland and the ACLU worked out a plan amenable to both sides after a federal judge ruled that the city’s initial rules for demonstrations were unconstitutional. U.S. District Judge James Gwin’s main objection was to the approximately 3-square-mile zone that the city had drawn around Quicken Loans Arena, the home base for the convention, for security restrictions.

In the course of a little more than a week, with minimal rancor, U.S. District Court Judge Dan Polster, the city and the ACLU reached a tentative agreement, finalized details and formally enacted rules that balance important free speech rights with the city’s legitimate security concerns in the wake of several violent incidences at campaign events of the Republican Party’s presumptive nominee, Donald Trump.

According to rules passed last Wednesday, June 29, Cleveland will shrink the so-called “event zone” around The Q. The city also will extend the hours where permitted marches will be allowed, will extend the deadline to apply for event permits, and will change the designated parade route so it comes closer to the convention’s delegates.

On the first day of the convention, marches are limited to beginning between 2 p.m. and 4 p.m., ending no later than 5 p.m. On the final three days of the convention, marches may now begin as early as 8:30 a.m. and must end by 2:30 p.m.

Protests, though, will not go directly by The Q, and there

will be buffer zones to minimize the risks of clashes between groups supporting Trump and those opposing his nomination. (You can read the document laying out the rules at bit.ly/296Fv0h.)

The agreement “prevents the 2016 RNC from being defined by an unnecessary conflict between freedom and security,” said Christine Link, executive director for the ACLU of Ohio.

She said the convention “offers a unique stage to groups from all sides of the political spectrum to lift their voices to a national audience” and that the compromise worked out with the city “ensures that people have meaningful opportunities to express themselves on some of our most important national issues.”

Thousands of people who want their voices heard, representing organizations ranging from the anti-Trump People’s Fightback Center and Organize Ohio to the controversial Westboro Baptist Church, have been granted protest permits or have vowed to protest. Political website Politico last week characterized the Cleveland convention as “the marquee event of a political cycle marked by intense polarization, racial tension and anger.”

That’s certainly, and unfortunately, true. But there’s no excuse for that anger to turn violent, and there’s certainly no excuse for the Republican nominee to ignore or encourage violent actions, as he did on more than one occasion during the primary campaign.

As Cleveland and the ACLU demonstrated, democracy still works when we listen to each other. Protestors and counterprotestors should keep that in mind when they hit the streets of Cleveland in two weeks. By all means, make your voices heard. Just do it in a way that’s peaceful and honors the constitutional rights we’re all celebrating this Independence Day.

PUBLISHER AND EDITOR: Elizabeth McIntyre (emcintyre@crain.com)

CLEVELAND BUSINESS

MANAGING EDITOR: Scott Suttell (ssuttell@crain.com) SECTIONS EDITOR: Timothy Magaw (tmagaw@crain.com)

Roy Church has gone fishing.

The visionary educator is now officially retired after 29 years at the helm of Lorain County Community College.

But that’s no retirement cliché. Roy Church has literally gone fishing, thanks to his son, who gave him a Father’s Day gift of a charter walleye fishing trip that set off two days after his retirement.

Church and I laughed at the irony of his immediate plans as we talked last week. After we hung up, I realized that Church has been doing a different sort of fishing since he first arrived in Northeast Ohio in 1987. He’s been casting lines in search of opportunities for Lorain County residents and, by all measurements, has reeled in a bounty.

Elizabeth “Lorain County is a great place to live, but McIntyre you can’t live here if you can’t make a living,” he told me. So, Church made it the community college’s mission to serve the needs of Lorain County by creating affordable educational opportunities and the chance to prepare for decent paying jobs.

“The expectations of students and society for higher education have changed,” he said.

“In this digital age with transformational technology, everybody needs to have further education. You can’t expect to have a middle-class living if you don’t have skills beyond a high school diploma.”

Church speaks with the urgency and passion of a preacher, especially on the importance of making higher education ac— Roy Church cessible and cost effective for as many people as possible.

The legacy he leaves at LCCC stands as a testament to that.

During his tenure, enrollment at the school has grown 165%, from about 9,000 students to more than 15,000 today. LCCC offers the second-lowest tuition in the state. In 1995, LCCC started the University Partnership program, an effort to make bachelor’s and master’s degrees available to Lorain County residents. The program allows students to take three years of college courses at the community college level at lower tuition rates (about one-third of the cost of four-year institutions) and one year at a four-year university. Since its beginning in 1995, more than 5,000 degrees have been awarded through the program.

He’s also quite proud, and he should be, of LCCC’s dual enrollment program, where high school students earn college credits while in high school. The goal, said Church, is to allow students to graduate from high school with enough college credits to earn a bachelor’s degree by age 20, at 20% of the normal cost for a college degree.

Ohio is implementing similar programs across the state.

After his fishing trip, Church said he intends to spend time with his family in retirement. He’ll remain in Northeast Ohio and spend some time in Florida, too.

He’s earned it. But others must now continue the important work of boosting baccalaureate attainment and making college affordable for Ohio students.

“You can’t expect to have a middle-class living if you don’t have skills beyond a high school diploma.”

WRITE US: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited. Send letters to Crain’s Cleveland Business, 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113, or by emailing letters@crain.com. Please include your complete name and city from which you are writing, and a telephone number for fact-checking purposes.

SOUND OFF: Send a Personal View for the opinion page to emcintyre@crain.com. Please include a telephone number for verification purposes.

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 9

Web Talk Re: Critic slams Cleveland restaurant service Cleveland restaurateurs and front-ofthe-house managers, please heed the heads-up in an online chat from The Washington Post’s Tom Sietsema, highlighted recently in Scott Suttell’s “Editor’s Choice” blog. Do some role-playing with your staffs by letting them experience astounding service and asking them how it affected their enjoyment of the meal and their perception of the restaurant. A crisp presentation of dishes, with plates devoid of errant sauce trails and fingerprints, as well as an attentive, efficient but calm flow through each course, eye contact and a warm smile, will generate big tips for them and raves for your establishment.

— NEOTrish To be absolutely honest, the food hype on Cleveland is just that. And the service leaves a lot, I mean a lot, to be desired. This city has a long way to go before it can handle tourists who are well-traveled and know the difference.

Thus far, we fall way short. Keep trying to do better, please! — Connie Adams Cleveland is service-challenged in some ways, particularly at the nicer hotels and restaurants. We’re inexperienced at it. I’ve always thought Tom Sietsema is a fair reviewer, so I’d take his critique to heart, restaurant owners!

— McPierogiPazza Sadly, I feel Cleveland will never catch up. There just aren’t enough restaurant-goers here who demand, or understand, great service. (Or, for that matter, a truly wonderful meal.)

We are looking at one of the poorest cities in the country. And I do not believe all the doctors and professors in this town can keep our food industry afloat, or even care to. — Kim S.

Re: Shaker Heights after Shaker LaunchHouse I find it hard to believe that so many people seem surprised with the move of LaunchHouse and the fact that they had never lived up to the full extent of the original agreement.

The city of Shaker Heights winds up the big loser and will probably never recover the full extent of the investment. It also sounds that it will continue to be a financial drain on the limited city resources. While creating jobs and staying in Shaker are worthy missions, most startups do not create many jobs and often have to relocate to a more favorable environment offering appropriate amenities. Shaker has very limited quality space available for startups that want to move to go to.

The way to solve this is to create a facility that markets to small entities that just need that desk or office along with startups. Either way, this facility is in competition with many other facilities, including those in Midtown, that are much better organized and better marketed. — Neil Dick

Personal View

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By SEAN P. MALONE Cleveland’s history can be traced through its mass transit systems, from the street cars in use at the turn of the 20th century, to the rapid transit constructed a few decades later, to the 1974 formation of the Greater Cleveland Regional Transit Authority and the recent HealthLine. Ridership has ebbed and flowed, but mass transit has remained an important facet of life in Northeast Ohio.

Our commitment to public transportation is being tested again, and not just by jubilant Cavs fans and RNC conventioneers. RTA’s rapid transit cars continue to deteriorate and may be forced out of service earlier than expected.

Anyone who tried to ride the Rapid to the parade celebrating the Cavs’ victory knows our region’s commuter rail system is imperfect. Yet even on days when hundreds of thousands aren’t trying to board, the system is prone to arbitrary delays caused by malfunctioning trains.

Repair crews are working to extend the useful life of the existing fleet, but RTA acknowledges it will need to replace both its Red and Blue/Green line cars, many of which are more than 35 years old, with a single fleet by the year 2025, at an estimated cost of $280 million. RTA general manager Joe Calabrese has said this will require a greater investment than RTA can afford on its own.

This news comes at a time when demand for public transportation is growing, both locally and nationally, with many young people and retirees choosing to live in walkable neighborhoods close to transit, often without a car.

It also comes as our region has heavily invested in its commuter rail infrastructure.

RTA has spent tens of millions in public money in recent years to upgrade rail lines, crossings, stations and cars. These investments have fostered major new private developments along Rapid lines, from Shaker’s Van Aken District to the Flats, Little Italy, University Circle and the airport.

If RTA is overly optimistic about its ability to keep its outdated rail cars functioning for nine more years, then major service disruptions could ensue, as it takes several years to order, construct, test and deliver new cars. A depleted transit line forced to rely more and more on replacement buses could severely decrease ridership.

To reduce the risk of such disruptions, Northeast Ohio’s leaders need to develop a plan to address this challenge now before it becomes a crisis.

There are no easy solutions.

Local tax levies or further fare hikes beyond those recently announced by RTA would disproportionately affect working families, many of whom live in inner ring suburbs with alreadyheavy tax burdens. Federal transit funds, whether from a revamped gas tax, a vehicle-miles-traveled tax, or an infrastructure spending bill, have failed to materialize. And state support is negligible. According to ODOT’s 2014 Transit Needs Study, the average state supports approximately 20% of public transit costs. Ohio supports just 1%.

Still, we can’t afford to ignore this problem. My hometown of Shaker Heights would be particularly hurt by reduced or inferior train service, given its unique 100-year history as a city designed around the Rapid lines. But all of Northeast Ohio will suffer if our commuter rail system is not brought into the 21st century.

Even as we welcome transformative developments along our rail lines and continue to revive our urban core, we need to reaffirm our commitment to mass transit to help ensure that our region remains a place future generations will want to call home.

Malone is a member of Shaker Heights City Council.

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20160704-NEWS--10-NAT-CCI-CL_--

PAGE 10

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z JULY 4 - 10, 2016 z CRAIN’S CLEVELAND BUSINESS

Focus

SPECIAL REPORT: RNC

Hoopla dreams GOP delegates won’t be alone in jumping through RNC hoops. Area businesses are readying for the circus, too.

By DOUGLAS J. GUTH clbfreelancer@crain.com

Leaders at Osborn Engineering, an architectural and engineering firm located at 1100 Superior Ave. downtown, are not entirely certain what to expect when the Republican National Convention bustles into town later this month.

However, Cleveland’s oldest engineering company is not waiting for a formal security perimeter announcement before it makes plans for its 90 downtown employees. Though Osborn leaders intend to adhere to the “business as usual” mantra set forth by the city for convention week, employees are able to take an optional floating holiday that Thursday, coinciding with an established flex schedule that already gives How the Buckeye state them every other Friday off. delegation is preparing Jennifer Stull, Osborn’s director of business for the convention. development and administration, said nearly half Page 11 the company’s staff will use the holiday, while other employees may spend July 18-21 working out of an Akron office.

Hotels, restaurants and “We could have people work from home, caterers are in final prep but if you’re doing engineering design mode. Pages 12-13 you need a high-powered computer, not a laptop,” Stull said. “We’ll be as flexible as possible and continue to have a normal production week. There’s not a Parking, RTA, taxi and lot of detailed plans ride-sharing options to yet. Much of it comes ease RNC travel woes. down to what hapPages 14-15 pens security-wise.”

As the convention approaches, other Cleveland corporations and organizations near the action at Quicken Loans Arena are focusing on how to guide their workers through the logistically challenging event. Meanwhile, area store owners interviewed by Crain’s are seeking to harness the buying power of a 50,000-strong deluge of conventioneers.

KeyBank, for one, is evaluating its downtown administrative and branch offices. In deference to likely traffic congestion and limited parking, some KeyBank employees will operate from facilities outside the metro area, according to a statement from the company.

“KeyBank will be open for business throughout the convention and we look forward to welcoming visitors to Cleveland,” the statement read. “We’re excited to help support our community in

Ohio players

Stay. Eat. Drive or ride?

SEE GOP, PAGE 16

Illustration

by Randy Palmer for Crain’s

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 11

SPECIAL REPORT: RNC

Packed schedules await Ohio’s delegates

By JAY MILLER jmiller@crain.com @millerjh

It will be fun and exciting, but it will also be serious business.

That’s the way several Ohioans who are members of the state’s 63member delegation to the Republican National Convention coming to Cleveland next month are viewing their upcoming experience.

The Northeastern Ohioans in the group also believe it will give the city a chance to shine.

“It will not be all business, but as far as I’m concerned we have a big job to do,” said Sally Florkiewicz of Chagrin Falls, a veteran of the Republican convention in Tampa in 2012. “I’m excited to showcase Cleveland since Cleveland looks so great right now.”

The main purpose of the convention is to nominate presidential and vice-presidential candidates. Secondarily, a subset of delegates are chosen to build a party platform, a series of policy pronouncements that, the Republican Party said in its 62-page 2012 platform are “a statement of who we are and what we believe as a Party and our vision for a stronger and freer America.”

It also serves as the launching pad for the campaign for the presidential election.

And it also is a time when connections are made, corporations lobby and issue advocates rally.

Since Gov. John Kasich won the Ohio primary, Florkiewicz, like all of the delegates, is committed to the governor on the first ballot, not Don-

ald Trump, whose status as presumptive nominee has at least heightened the curiosity of delegates.

“As somebody who enjoys politics, it is going to be interesting to see how this unfolds,” said Akron attorney James Simon, who is attending his first convention. “There’s not a template for this kind of convention.”

Simon is a member of the Permanent Organization Committee, which, he said, will review the slate of convention officers — chairman, secretary and sergeant-at-arms — put together by the national party, led by RNC Chairman Reince Priebus. Simon said the committee will meet early Monday to formally adopt the convention officers.

The proceedings will start even earlier for Tracey Winbush, a Youngstown talk radio host. She’s on the platform committee that will meet during the week before the convention begins to put together the party’s position statements on issues.

“Some people go to the convention for the parties, I’m going there figuring out how this thing works, how America works,” said Winbush, who is a first time delegate, though she attended the Tampa convention as a guest of the party. “I’m looking forward to the platform committee.

I’m probably one of the few people who read the 2012 platform.”

Though she is eager to help put together the official party platform, she couldn’t help but note how the presumptive candidate has strayed from party orthodoxy.

“It’s very exciting, it really is, just seeing how America is supposed to

Lightpost banners welcoming RNC delegates hang throughout downtown. (David Kordalski) work, even if it doesn’t work that way,” she said. “You think you’ve been in this long enough to know what to expect, now, all of the sudden, (Trump) is the nominee and you go, ‘Huh?’” Winbush will commute from Youngstown during the week before the convention for her work on the platform committee, but she will stay at the delegation’s hotel, the DoubleTree Downtown on Lakeside

Avenue, for convention week.

It’s at the DoubleTree where the Ohio delegation will be meeting daily for a breakfast that may run until 11 a.m. The delegates will get a rundown of the day’s official and notso-official events and get pep talks and briefings from a variety of speakers.

“We’ll have the statewide officeholders and people representing the candidate,” Winbush said.

Their week’s itinerary will be built around the evening sessions at Quicken Loans Arena from 7 p.m. until at least 11 p.m. But the delegates will have plenty of time to attend some of the hundreds of events that will be taking place during the week.

Some events — lunches, dinners, happy hours, rallies and after-session parties — will be at downtown restaurants or hotels. Some are being sponsored by the state party, others by other state delegations and still others by corporations and associations.

Grays Armory, within walking distance of The Q and one of the oldest buildings in downtown Cleveland, will be home to the Republican Party of Cuyahoga County for convention week. The local party will host watch parties for party members and non-delegate guests during the convention sessions and will put on concerts and other post-session entertainment.

Alex Triantafilou, a Cincinnati lawyer and chairman of the Hamilton County Republican Party, is a convention veteran. The Cleveland convention will be his fourth, though only his second as a delegate. He at-

tended the 2004 convention in New York City as a guest and he was an alternate delegate to the St. Paul, Minn., convention in 2008.

He’s looking to see how this convention will be different than his previous convention experiences.

“I’m sure Mr. Trump will put his mark on the convention in some capacity and make it more interesting from where I sit,” Triantafilou said.

“I’m excited to see if this will be different because of his influence.”

Triantafilou is putting together a schedule that suggests his week will not revolve around the presidential campaign. He said he’s lining up a series of meetings for convention week, some politically related, others with legal clients.

Coming to Cleveland and serving as a delegate hasn’t yet fully hit home for Anita Hall, the Holmes County Recorder. Hall has never attended a national convention and became a delegate only when she was asked to run by the Kasich campaign. With less than three weeks before she has to make the drive to Cleveland, Hall expects to rely on state party officials to put together her schedule.

“I’m sure (the state party) will give us advice and guide us through all of this,” she said. “I would like to attend those events that are scheduled for the delegation, some of those are in the afternoon and some of those are after the sessions in the evening.”

Reminded that after-session events won’t start until after the gavel falls sometime after 11 p.m. each evening and that breakfast will be served by 9 a.m. the next morning, Hall said, “It’s a short night.”

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20160704-NEWS--12-NAT-CCI-CL_--

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z JULY 4 - 10, 2016 z CRAIN’S CLEVELAND BUSINESS

SPECIAL REPORT: RNC

For the city’s hotels, the to-do lists keep growing

By RON RUTTI clbfreelancer@crain.com

No downtown businesses will be impacted more by the Republican National Convention than the fullservice hotels. The challenges are many, and they began long before the convention starts taking over the city, hotel room by hotel room.

Here is how one of the hotels, the Wyndham Cleveland at Playhouse Square, is getting ready.

The planning Planning is everything for any company. The hotels have known for two years that the RNC was coming, and that they would have full houses.

What most general managers did not grasp then was how little time they would have to make concrete plans.

“With the RNC controlling the rooms, we know the people we get will be affiliated with the convention in some way, but we don’t know who those people are yet,” said John Phillips, director of sales and marketing at the Wyndham. He was talking on June 21. “We don’t get the first draft until sometime next week and they have two more weeks to make changes.”

“For a corporate event, we know ‘X’ amount of people will be doing breakfast, lunch and dinner or breakfast, lunch and maybe drinks. For a wedding, we are able to sit down with staff much earlier. We know exactly what we need,” Phillips said.

For the convention, the Wyndham and other hotels must wait until their guest lists are finalized before trying to arrange banquet, meeting room and even some restaurant and bar business.

It works the other way, too. “People can’t get in contact with a hotel until they know where they are staying,” said John McCartney, Wyndham’s director of food and beverage.

“The puzzle is coming together,” Phillips said. “It is more anxious anticipation now.”

The guests The Wyndham, at 1260 Euclid Ave., is one of two downtown hotels that will not quarter a specific state delegation. Instead, its 205 rooms will be filled by delegates handpicked by the RNC from various states as well as groups such as Fox News and the National Federation of Republican Women.

Brian Moloney, the Wyndham general manager for seven years, would not reveal what states will have delegates in his hotel. As for who might be staying there,

Moloney said he may never know for sure as some guests may be listed under fake names.

“They are allowed to use pseudonyms. We get rock bands here all the time. And actors. This is pretty common in our industry,” he said.

Wyndham workers know how to act if they cross paths with a famous person. “We don’t ask for autographs or selfies,” Moloney said. “We respect their privacy. They like their privacy. That’s why they come back.”

Moloney said soon his staff will go through role-playing exercises to review how to deal with situations that may come up.

Phillips said there is no way of knowing how much time guests may spend at the hotel.

“It could be they are not going to the convention until 4 or 5, or it could be like a cruise ship. They may leave the room in the morning and not come back until it is time to go to bed. For a lot of these people, this may be the first and only time in Cleveland,” said Phillips, who came to the Wyndham two months ago from Kalahari Resorts. Before that, he was director of ticket sales for the Cleveland Indians.

The food Now we are in McCartney’s wheelhouse. He said he is not as anxious as Moloney and Phillips might be about the week’s uncertainties.

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said McCartney.

The Wyndham does $3 million in food and drink business a year in its 13,000 square feet of banquet and meeting rooms. McCartney said that puts it at the top of downtown hotels based on revenue produced per square foot.

His suppliers have assured him that they are ready for the week.

Sysco, the largest provider, will increase its employees and the number of deliveries.

“They will work with us in shortlead time. If a customer comes to me the night before and says they want to have a party or banquet here, they will be ready,” said McCartney, who has been in food and beverage service for 24 years, more than five of them at the Wyndham.

Deliveries downtown during the convention could be dicey. Product bound for restaurants and hotels that are within the most secure perimeter around The Q will be inspected at a location near FirstEnergy Stadium. Police then will escort the truck to its destination.

The Wyndham should avoid that, since it appears the hotel will be inside only a looser-run second security zone. Still, Moloney said, “We want to have less deliveries if we can.

We want to limit our exposure.”

There will be no shortage of food available to delegates, lobbyists and the media during the week. Caterers even have been hired for private events inside The Q, and parties will be everywhere into the night.

This feeds the uncertainty at the hotels.

“The stuff we always get is the breakfast and late night,” Moloney said. But he will be ready for anything.

“If they want to entertain 300 people, the ballroom makes sense. If they want a nice dinner for 60 people, the restaurant is good for that. It goes back to each group’s need. The nice thing about a hotel is, we can adapt,” he said.

The restaurant seats 73. It has an American fusion menu. “We offer a little of everything,” McCartney said.

The bar The Wyndham has the special permit allowing it to serve alcohol until 4 a.m. during the convention.

“Anytime we have a group like this for four days, it’s worth it to keep the staff on. If we don’t have the bar open one night, they won’t come back,” said Moloney, who worked a Super Bowl in Miami and the 1992 GOP convention in Houston for Wyndham.

Normally last call in Wyndham’s Blue Bar is 11:30 p.m. There may be some special drink offerings, but McCartney said, “I don’t need to drive extra sales that week.”

Deliveries should not be a problem here. McCartney said his goal is to have all the alcohol at the hotel a week in advance.

The hotel has an acclaimed happy hour. Hours are 4:30 p.m. to 7 p.m.

The workers Nearly all service industry employers are looking to pad its workforce as the convention nears.

“Any hotel has lots of transition. A lot is going in Cleveland now. Four new hotels have opened,” McCartney said.

He will have two-three servers per shift in the restaurant and three-four cooks. He might add banquet chiefs.

In the bar, he may add a bartender each shift.

He said staff is looking forward to the week, but have personal concerns, such as where they will park and will traffic delay drives into the city.

Moloney said the employees know they have a tough week ahead of them.

“If it is an unusual business coming in, you have to treat it in an unusual manner. You have to get your staff not to work their usual shifts. They have to stay later and come in at different times. Twenty thousand people will be leaving The Q every night at 10:30.

You have to adjust to your guests.

“It’s all about the city and putting your best foot forward. We have people coming from all over the country.

We want to hold up our end of the bargain,” he said.

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 13

Cleveland caterers share what’s cooking for convention revelers

By DOUGLAS J. GUTH clbfreelancer@crain.com

Director of food and beverage John McCartney is certain the Wyndham staff is prepared for RNC crowds despite a tight turnaround time to order supplies. “If a customer comes to me the night before and says they want to have a party or banquet here, they will be ready,” he said.

(David Kordalski photos)

A dozen area caterers are preparing to serve a portion of the 50,000 delegates, media, staff, volunteers and other guests visiting Cleveland later this month for the Republican National Convention.

Four food suppliers interviewed

by Crain’s shared their plans — and their menus — for what they expect to be a stressful, sleep-deprived, yet ultimately lucrative experience.

Marigold Catering will handle food needs at Quicken Loans Arena beside three other companies, servicing suites inside the facility for lunch, dinner and cocktail hour.

Marigold founder and president Joan Rosenthal expects to dish up between 100 to 1,000 meals daily, along with charcuterie-style or heavy hors d’oeuvers.

Outside The Q, Marigold staff will run liquor concessions as well as stands selling various regional delicacies such as pierogies, as well as okra and black beans paired with avocado tomato salad.

“There’s going to be about 4,500 people milling in and out of the arena,” Rosenthal said. “The most successful (caterers) will be those that execute each day with each challenge that comes along.”

For the last four months, Rosenthal and her staff have been locking down the 300 cooks, servers, bar-

tenders and additional help who must be ready to work up to 16 hours a day during convention week. Some staffers are local, while others will be flown in via Marigold’s partnership with industry group Leading Caterers of America.

Meals will be made fresh the day of events out of three on-site kitchens. Rosenthal will act as point person, moving from space to space and triaging any problems sure to arise. Even seemingly small issues like keeping enough ice on hand are a potential disaster for her RNC catering crew.

“Everybody’s going to be running around on walkies like we’re the CIA,” Rosenthal said. “You have to prepare for anything that can go wrong.”

Joining Marigold at The Q is Driftwood Restaurants and Catering, a full-service culinary company and veteran food supplier of large-scale weddings and corporate events. At the convention, Driftwood will serve upward of 5,000 guests daily with a range of food and beverage services including a continental breakfast and raw bar.

Though no stranger to high-end happenings, Driftwood founder and CEO Scott Kuhn has never encountered, for obvious reasons, perhaps, a more tightly controlled food inspection process.

“The level of monitoring is unprecedented,” Kuhn said. “The FDA inspected our facilities several times,

“The smartest thing we’re doing is keeping it simple.”

— Al “Bubba” Baker, owner of Bubba’s Q

and we’re scheduling more appointments for the weeks prior to the convention.”

Driftwood began planning for the convention a year ago, coordinating with food and beverage purveyors and partner companies that sell disposable plates, silverware and other items.

“There’s a 30,000-foot thinking process that goes for every product you can imagine,” Kuhn said. “For us, it’s about the showing the world we can do these events under this type of pressure.

A special opportunity Bubba’s Q and Executive Caterers are helping spearhead catering duties at the Huntington Convention Center of Cleveland and the adjoining Global Center for Health Innovation.

Al “Bubba” Baker will bring his patented boneless ribs, upscale boxed lunches and southern-themed breakfast foods to hungry media members.

Baker, a former Cleveland Browns de-

fensive lineman who entered the catering/restaurant business with wife, Sabrina, in 2006, said he will offer a pared-down menu with ribs that will be cooked at his restaurant and brought in fresh.

“The smartest thing we’re doing is keeping it simple,” Baker said.

“There’s no filet mignon, lobster or anything that doesn’t have a long quality period. When it comes to barbeque, that’s our wheelhouse.”

Bubba Q’s staff and equipment have undergone rigorous security checks, while details like when trucks are allowed to deliver food are being calibrated to the nearest minute. Baker has harnessed some of his old football mentality in prepping for one of his business’s biggest catering challenges.

“I’ve been telling my staff, they should be looking to bring the champion out of themselves,” Baker said.

“You’ve got to have that attitude for this kind of once-in-a-lifetime opportunity.”

Executive Caterers’ executive vice president Charles Klass, whose company will have 300 workers on site at the convention center, said the convention represents a “stepping stone” not only for Cleveland, but the region’s catering community as well.

“We want to reflect the city in the best way possible,” Klass said.

“It’s like our Super Bowl or NBA Finals. We do lots of challenging and wonderful events during the year, but this take us to another level.”

20160704-NEWS--14-NAT-CCI-CL_--

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z JULY 4 - 10, 2016 z CRAIN’S CLEVELAND BUSINESS

SPECIAL REPORT: RNC PARKING

RIDE-SHARING

Need a spot? Expect to pay a Uber, Lyft recruiting premium if you can find one more drivers for RNC

By RON RUTTI clbfreelancer@crain.com

Most downtown workers who pay to park by the month can use their normal spots at no extra cost during the Republican National Convention. Other commuters and visitors will not be so lucky.

“They are going to have to scramble,” said a manager of two garages near Public Square. Drivers caught in the anticipated squeeze will probably pay a premium for what they find.

A couple times in the last few years, some garages and lots near Quicken Loans Arena spiked daily charges to $50 when sporting events and the workday came together.

Public parking will be sparse in that area during the convention as security concerns and convention needs eliminate some. Do not be surprised to see rates here come close to $50 again.

The city of Cleveland does not regulate parking rates charged by private companies.

The Gateway East garage at East Sixth Street and Huron Road, which connects to The Q via a walkway, is closed to parkers from July 15-23.

Surface lots around the arena could be off-limits as well, but officials from ABM Parking Services, that operates many of them, did not return multiple phone calls to talk about arrangements.

“We’re going to see what the other companies are going to charge. We’re going to be pretty much the same.”

— Fatmir Salillari, manager of Metro Parking Systems downtown lots Even gamblers do not know yet whether parking at the nearby Jack Cleveland Casino garage, will be available convention week, said Shannon Mortland, a casino spokeswoman. The Secret Service had not set the convention’s security perimeters by the deadline for this story.

Tower City Center has a few thousand parking spaces in its proximity.

At least one tenant of the complex was told monthly parkers wlll have access to their spaces, but the parking supervisor did not return phone calls to confirm that or discuss how many spots will be available to the public.

It is safe to say that the farther you park from the arena, the more certain that lots will be open. But they could fill up fast. Many convention delegates and media members will be housed downtown. If not, they will be bused in. Still, political conventions attract protesters and peo-

By RON RUTTI ple who want to see what is going on.

The nomination of Donald Trump could drive the number of visitors beyond the 50,000 people expected for the week.

Just what will these people pay to park, in lots that normally charge from $4 to $15 a day depending on location?

Cleveland State has set its prices.

The school has four lots/garages open for multi-hour daily parking — 1935 Euclid Ave., 2000 Prospect Ave., 2101 East 21st St. and 1851 East 17th St. — all a healthy walk from arena.

Each will cost $20, the standard special event charge, according to the Cleveland State website. Normally, Cleveland State has a $10 daily parking cap for visitors.

Fatmir Salillari, manager of a number of lots downtown for Metro Parking Systems, said, “We haven’t decided the rates yet. We’re going to see what the other companies are going to charge. We’re going to be pretty much the same.”

Metro’s largest lot — called The Pit — is on West Third Street, under the Shoreway, near FirstEnergy Stadium.

Paul Shaia, vice president of Shaia’s Parking said, “Our company has never gone past $30 as far as I can recall. I would assume if people go too high, they are not going to get business. We like to stay reasonable.”

Shaia has lots spotted all around downtown. It has a large concentration in the Warehouse District.

clbfreelancer@crain.com

The two app-triggered alternatives for hiring a ride say they are ready for their first exposure at a national political convention. Spokespersons for Uber and its competitor Lyft say they will have plenty of drivers ready to be connected with passengers, who use their mobile devices to summon rides.

“This is our first round for conventions,” said Lauren Altmin, of Uber.

“It will be new territory for us.”

In 2012, the Republicans convened in Tampa. Democrats met in Charlotte. Neither company was operating in those cities.

The companies could not say how many drivers will be available for the Republican National Convention in Cleveland, but acknowledged they are building their numbers. A passenger uses the company app on a smartphone to request a ride. Once a driver agrees to provide the ride, the passenger is told the pickup location. Drivers use their own cars.

“We’ll be growing the amount of drivers in anticipation of the increased demand,” said Mary Caroline Pruitt of Lyft. “We also recently expanded our Cleveland coverage areas to include some of the outlying parts to account for anyone staying in those communities.”

Altmin said the RNC “is a great option” for those looking to earn money.

Uber and Lyft were hatched in San

Francisco. Uber started in 2011, Lyft the following year. The companies not only compete with each other, but also must fend off challenges from taxi companies. The contention is that since Uber and Lyft are largely unregulated, they can offer cheaper rides than cabs.

Neither spokesperson could say if company officials will be in Cleveland during the convention to lobby legislators or monitor operations.

Altmin did say, “Anytime anybody goes into a city where there is Uber, there is a great potential to let people know we are there and an opportunity to see how it works.”

Security perimeters set around the convention site will complicate things. Drivers cannot get inside the zone. Designated areas for drop-offs and pick-ups will be established. Altmin said the spots will be announced on July 6.

Ride prices can vary by demand and availability of drivers. When lots of people are looking for rides, or when the number of drivers is low, the prices go up. Uber calls it surge pricing. Lyft calls it prime time. Both companies said the dynamic will be in place during convention week.

Uber’s minimum fare in Cleveland has been $5.70. Cost per mile is 77 cents. Lyft’s minimum fare was $4. Cost per mile is 81 cents. Passengers pay via the app — by credit card or PayPal. Tipping is not expected.

Passengers rate drivers after each ride. Too many bad grades costs a driver the job.

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Cleveland’s cabbies to be out in full force

By RON RUTTI clbfreelancer@crain.com

Taxi companies who operate in Cleveland are ready for the Republican National Convention — ready to make some money and to provide a positive experience for visitors.

“We realize this is a good opportunity for us and our city to give a good first impression and lasting impression,” said Tim Lewis, general manager of Ace Taxi Service.

Lewis said Ace hopes to have nearly all its 110 taxis on the road during the convention. “We have been running ads encouraging drivers to join us, like bus drivers and people in school transportation. You can make good money that week,” said Lewis.

Even should many downtown workers stay away during the week, the streets should be busy with limos, RTA vehicles, private buses, Uber and Lyft drivers, as well as traditional taxis.

“We are expecting a lot of activity,” said Jasbir Randhawa, owner of United Cab, which will have about 40 taxis active.

Patrick Keenan, general manager of Americab Transportation Inc., has talked to people in the business from cities that staged past conventions.

“They said it is a once-in-a-lifetime experience. It is quite a challenge,” he said.

Americab has 95 cabs, 22 of which are part of a stable of taxis that work Cleveland Hopkins International Airport.

One challenge for the drivers will be street closings — arteries shut for the whole of the convention and those blocked off for shorter periods. Complicating things further is the high-security perimeter that will be set up around Quicken Loans Arena. Cabbies cannot drive up to the arena or some of its surrounding buildings for pick-ups and drop-offs.

“If you can hit it with a wedge shot from The Q, that will be a restricted area,” Keenan said.

Designated taxi drop-off and pickup locations for areas outside the perimeter are expected to be determined by July 6.

“Our drivers are going to have to find a way,” Lewis said. “A lot of it will be word of mouth, even from other companies. The drivers are great at finding their way.”

Cleveland regulates fares charged inside the city. The initial fee is $3.75.

It costs about $2.24 per mile after that. The fare from downtown to the airport is about $34.

20160704-NEWS--15-NAT-CCI-CL_--

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 15

PUBLIC TRANSPORTATION

RTA readies itself for heavy ridership

By RON RUTTI clbfreelancer@crain.com

It will be all-hands-on-deck and then some during the Republican National Convention for the area’s largest public transportation agency.

If not driving a vehicle, repairing one or providing security, any of the 2,450 Greater Cleveland Regional Transit Authority employees could be assigned to downtown locations or to a rapid transit rail station to guide visitors and residents unfamiliar with the service, said Joe Calabrese, the RTA general manager.

Because of expected traffic disruptions downtown, “we are suggesting people use the trains, maybe more so than ever,” Calabrese said.

Calabrese meets regularly with Secret Service agents and Cleveland officials about potential road closings.

Few specific details have emerged.

Yet the general manager did offer, “I can say with a high degree of confidence that there will be no interference with the rail service.”

RTA rail and bus lines were overrun with riders on Wednesday, June 22, as about a million people came downtown for a parade marking the

Cleveland Cavaliers winning an NBA championship. Waits for rides at some train stations were hours long.

Calabrese said 500,000 people used the system that day, compared with about 170,000 on a usual weekday. He said every available bus and rapid car was in operation.

“Our capacity was severely stressed,” Calabrese said. “But I know we did a phenomenal job of getting hundreds of thousands of Cleveland Cavalier fans downtown to enjoy the celebrating.”

Calabrese said he expects the additional number of riders for the convention will be balanced by regular passengers who choose to stay home that week.

“There is definitely no relationship on what happened Wednesday and what will happen during the RNC,” he said.

RTA had little time to plan for the Cavs’ celebration. “The first planning meeting was on Monday. The event was Wednesday,” he said.

He said a city like Philadelphia had six months to plan for the visit of Pope Francis last September, allowing the transit system to bring in vehicles from other agencies.

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z JULY 4 - 10, 2016 z CRAIN’S CLEVELAND BUSINESS

SPECIAL REPORT: RNC

GOP

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CONTINUED FROM PAGE 10

To purchase a full-sized poster reprint of our RNC in Cleveland preview cover, contact Krista Bora at kbora@crain.com or call (212) 210-0750

this exciting endeavor.”

The Council for Economic Opportunities in Greater Cleveland (CEOGC) operates from the Halle Building at 1228 Euclid Ave., only a few floors up from an RNC planning committee’s office. Despite the convention’s impact on staff, CEOGC will continue to oversee the state’s largest Head Start early childhood program as well as offer support services to Cleveland residents living in poverty.

During convention week, the nonprofit’s 100 main office employees will work remotely. Head Start support staff working downtown will report to one of 15 organizational centers located in Cuyahoga County.

Personnel from departments including information technology, human resources, finance and external affairs will telecommute from home.

“We’re thrilled to have our city in the spotlight for the RNC,” said Margaret Thresher, CEOGC’s vice president of marketing and communications. “It’s going to require adjustments to continue business for our customers.”

And while the influx of media, politicos and delegates could disrupt Cleveland’s administrative strongholds, some retail operations are hopeful for a big payday.

Family-owned Geiger’s clothing and sporting goods is bolstering staff and extending hours at its 4,200square-foot store next to the downtown Heinen’s Fine Foods at the intersection of East 9th Street and Euclid Avenue. Third-generation coowners Chas and Gordon Geiger will keep their doors open from 10 a.m. to 8 p.m. — a two-hour increase from their normal 11-7 time frame.

As there is expected to be a massive

ABOVE: The Q is draped in welcome banners.

LEFT: Artist Sandy Buffie plans to donate proceeds of the sale of a bust she made of Donald Trump using dryer lint.

(David Kordalski photos)

increase in foot traffic along Euclid Avenue, Geiger’s also will augment its staff by 50%, said Gordon Geiger.

While the convention coincides with the store’s summer sale, there are no plans to offer any special discounts to visitors. Event appropriate signage and window displays will welcome out-of-town guests hankering for sports gear or other readyto-wear apparel.

“We’re very bullish about how (the convention) is going to come across to the rest of the nation,” Geiger said.

“Our investment downtown is not just for four days of the convention. We’re in it for the long haul.”

Store employees are encouraged to carpool during what could be a taxing, if potentially fulfilling few days.

“Our staff is looking forward to it,” Geiger said. “It’s going to be an exciting week for everyone involved.”

Cleveland artist Sandy Buffie is ready for the rush.

Buffie, sole proprietor of Sandy Buffie Designs at the 5th Street Arcades at 530 Euclid Ave., sells jewelry and sculpture created from found and recycled objects. Her newest venture, a bust of Donald Trump, is made from donated dryer lint with sheep’s wool serving as the presumptive Republican presidential nominee’s hair. Should the project sell, Buffie intends to give the profits to the Cleveland-based Center for Arts-Inspired Learning.

Along with the bust, Buffie will add 50 pieces to the 600 she current-

RTA

CONTINUED FROM PAGE 15

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“With two days notice, you just can’t do that,” Calabrese said.

RTA is offering an incentive to lure commuters on public transportation during convention week. A $20 pass gets unlimited rides on the rapid, buses and the Park-N-Ride express bus lines from Sunday, July 17, through Saturday, July 23. Regular fares for rail and buses cost $2.25 a ride. Park-N-Ride trips are $2.50.

Discount passes can be purchased on the RTA website — www.riderta.com — or at the agency’s office, 1240 West Sixth St., Cleveland.

Employers can buy passes in bulk by contacting RTA. The agency operates three rail lines. All feed the one downtown station at Tower City, a few blocks from Quicken Loans Arena, the site of the convention. RTA’s Red rail line has a station at Cleveland Hopkins International Airport.

To reach other destinations downtown, climb aboard a green trolley for free rides. Trolleys follow three routes.

The B-Line is the most northern and takes in much of the business area.

The E-Line flows past restaurants and clubs in the Warehouse District and along East Fourth Street, and accesses Playhouse Square. The C-Line loop is a combination of both.

Trolleys embark every 10 minutes, but Calabrese said if conventionweek ridership demands it, they could start off every five minutes.

ly has on display. The entrepreneur will open each morning at 9, manning the gallery with help from husband, Craig, and two volunteers.

“I’ll have floating hours depending on how many guests we get,” Buffie said. “We could stay open well into the night.”

Whatever challenges arise, Buffie is confident she and her makeshift staff will be prepared for the adventure ahead.

“We want visitors to be excited about items made in Cleveland,” she said. “It will be a memory for them.”

Not everyone is thrilled about the forthcoming festivities. Two purveyors in Cleveland’s Gateway District near The Q — Prospect Music and Jerold Optical — told Crain’s last month they plan to close shop during the convention.

However, Mr. Albert’s Men’s World on Prospect Avenue will remain open despite its street being closed for traffic. Owner Ike, who declined to give his last name, said he’s concerned about his current customers being able to reach the store.

“I don’t know the (visiting) crowd,” Ike said. “I expect to get new faces I’ve never seen before. We’re going to take it day by day.”

Ultimately, Cleveland stores and companies of all sizes should consider the convention an opportunity for unprecedented exposure, Buffie said.

“We’re going into it with positive energy,” she said. “This is a historymaking event.”

The B and E lines run 7 a.m. to 7 p.m. Monday-Friday. The C Line’s more restricted hours are 7-11 p.m.

Monday-Friday and 11 a.m. to 11 p.m. weekdays.

The simplest way from Public Square to reach the Rock and Roll Hall of Fame and Great Lakes Science Center along the lakefront is to get on RTA’s Waterfront Rail Line at Tower City. It is a quick trip, but the train runs only every 30 minutes.

RTA’s Health Line travels Euclid Avenue through University Circle 24 hours every day. Vehicles are scheduled every seven-to eight minutes during the day, then go to every 1015 minutes before 11 p.m. After that runs start every 30 minutes.

Calabrese said the agency is ready to adjust if road closings disrupt bus traffic patterns too much during the convention. “Anything that affects traffic, will effect us,” he said.

He said on the day of the basketball parade when many downtown streets were closed, RTA set up temporary bus hubs to pick up and drop off riders. He said temporary hubs may be used during the convention.

RTA’s 100-person police department and nine bomb-sniffing dogs will be augmented by security hired for the week. And neighboring transit lines will beef up RTA’s paratransit service for the disabled.

RTA has more than 6,000 free parking spots at its rapid transit stations.

Most are on the West Side. The only significant parking areas on the East Side are at the end of the lines. During rush hours, an extra car will be added to each run, said Calabrese.

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 17

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20160704-NEWS--18-NAT-CCI-CL_--

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z JULY 4 - 10, 2016 z CRAIN’S CLEVELAND BUSINESS

Business of Life PAGE 18

Making art go a long way in Akron The Art Bomb Brigade paints a mural on the back of a building on South Main Street in Akron. (Shane Wynn for Crain’s)

By RACHEL ABBEY MCCAFFERTY The high school and college students working on the Art Bomb Brigade’s first project — a mural on the back of a building on South Main Street in Akron — wanted to gain experience, work on a different scale than they’re used to, and learn what it’s like to work with a team.

But they also wanted to bring art to a neighborhood that has fallen on hard times. Essence Bradley was one of the students that took a break from painting on June 21 to talk to Crain’s. The University of Akron senior spoke of the brightly colored mural amid the torndown buildings surrounding the Downtown Laundromat.

“It kind of makes up for all that,” she said.

The Art Bomb Brigade is a new initiative led by director and creator Elisa Gargarella and funded by a $45,000 Knight Arts Challenge grant. Gargarella, who also is an associate professor of art education at the University of Akron, said the grant required a $45,000 match, which she is close to meeting. Her goal is for the program to span two years and to complete at least three or four murals in that time.

Basically, Gargarella said she wants to see the group “mural bomb” rundown parts of the city.

It’s clear that goal has resonated with the students who were working on the Art Bomb Brigade’s first project.

Brina Jeffries, a Firestone High School graduate, said she thinks it’s important to “uplift” lowincome neighborhoods with this kind of public artwork.

Wilma Levengood, a student at the University of Akron, is doing her thesis on public art in the public sector, so she wanted to have that experience herself. The arts can bring economic opportunity and business, she said, sparking other areas where the arts can thrive.

When the buildings near the Downtown Laundromat started to get torn down, Scott Grieshammer, president and owner of Scott Charles Laundromats Inc., decided to look into getting a mural painted on it, like his mother

had always encouraged. The nearby buildings have been torn down for an interchange project in that area.

Grieshammer had some say in what would go on the nearly 200 feet on the back of his building, picking out the artist and sending suggestions for what he’d like to see. He thinks the mural will serve as a “landmark” and, while he said he didn’t do it to build business, he does think the mural will bring people in.

Gargarella wants the art to be a catalyst for economic and community activity, as well as a way to bridge the downtown area with the neighborhoods. Another goal is to give a springboard to up-and-coming artists. This project gives the young artists a way to grow their network while they gain experience. Gargarella partnered with the Arts Lift program, another initiative she spearheads in the area for high school students. Eleven high school students and 12 University of Akron students are working on this first project with the help of a professional artist, Matt Miller.

As someone who grew up in Akron, Miller said he wanted to use bright colors to light up the neighborhood and to create a mural that incorporates “Akron’s industrial history” with the surrounding wildlife.

“It’s already been a really rewarding experience, and it’s nice to kind of bring some life into the area,” he said.

You’re invited

What: Unveiling party for the first mural from the Art Bomb Brigade Where: Downtown Laundromat, 1035 South Main Street, Akron When: July 8, 6 to 9 p.m.

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CRAIN’S CLEVELAND BUSINESS z JULY 4 - 10, 2016 z PAGE 19

BUSINESS OF LIFE

Source Lunch Tom Lix isn’t just excited that he figured out a way to make whiskey faster.

He’s excited that the process allows him to experiment and innovate in ways that weren’t possible for the industry before.

Lix, the founder and chairman of Cleveland Whiskey LLC, said the accelerated process the company uses to make its whiskey and bourbon in less time also lets the company infuse its liquors with the flavors of woods like black cherry, hickory or apple that are too porous to use for traditional barrels. Cleveland Whiskey instead puts the alcohol and the wood it’s using for flavor in a stainless steel container and applies pressure.

The company has seen growth in recent years. It began exporting at the beginning of last year and now sells product in countries such as Germany, Japan and Switzerland. — Rachel Abbey McCafferty

Tell me about your career before you came to Cleveland.

Long and varied. I learned distilling in the Navy but also have a doctorate in business from Boston University. I’ve run some companies, started a few. ... In Boston, I had an application services company (Public Interactive) that developed systems for public broadcasters (radio and television) to move their content to the web. This was the early internet days, and we had to develop software that automated news feeds, develop arts calendars, create funding and commerce applications and for radio at least develop a visual representation of what was until then simply audio. That company was ultimately sold to Public Radio International, who in turn sold it to National Public Radio. I had also tried to start a company called Bulldozer Camp, the quintessential blue-collar experience for white-collar professionals.

What brought you to Northeast Ohio?

My mom was born and raised here, but shortly after college (Fenn College, now CSU) she moved to the East Coast. My mom returned to Cleveland (Parma) about 10 years ago, but unfortunately she took ill shortly after. My wife and I moved here to care for her. I had just sold my company in Boston.

Frankly, I didn’t expect to stay, but we fell in love with Cleveland, and it’s now certainly our adopted hometown.

What’s the most important lesson you can share with a student who wants to be an entrepreneur?

Go out and do it. Don’t wait.

Expect failure, believe in what you do and above all, be persistent.

“When other kids in the neighborhood were mowing lawns or shoveling sidewalks, I was putting together teams of my friends and doing it faster, cheaper and better while making some profit along the way.”

What’s kept you here in Cleveland?

An extremely supportive entrepreneurial environment, great arts and entertainment, but mostly I think I see where the city is headed. It’s a lot like Boston maybe 40 or so years ago. People are investing, both with time, money and their passion. I believe

Tom Lix DISTILLED SPIRITS

the city is going through a renaissance, and I want to contribute to it.

Did you always want to run your own business?

I really can’t think of doing it any other way. When other kids in the neighborhood were mowing lawns or shoveling sidewalks, I was putting together teams of my friends and doing it faster, cheaper and better while making some profit along the way.

Instead of working at summer jobs, I bought up abandoned small boats from the local marinas, refurbished and then resold them for a multiple of my cost. Of course, I’d probably have trouble putting together a résumé. Maybe that’s really what keeps me from working for someone else.

What are some of the lessons you’ve learned running your own startup?

First, it’s hard, really hard. You hear about all the good stuff, the success, but the work that goes into it is substantial. It can take a toll on you and your family, but you have to be all in.

How do you see the new crowdfunding regulation allowing anyone, regardless of income, to become a company shareholder affecting Cleveland Whiskey?

To me, the best part is that our customers can now own part of the company. I’m very excited about it.

FIVE THINGS: FAVORITE THING TO SHOW OFF IN CLEVELAND

Aside from the distillery, he likes to take guests around the city to see the architecture.

WHAT HE MOST LIKES AS A NON-NATIVE “People support you here.” (The city’s restaurants and cultural amenities, plus its lack of traffic, don’t hurt, either!)

WHY HE PUT CLEVELAND ON HIS PRODUCT

It tested well. People thought it was authentic, genuine and “edgy.”

BIGGEST CLEVELAND MISPERCEPTION People have an outdated impression, he said.

They’re usually surprised by the city’s vibrancy.

WHAT’S ON HIS BUCKET LIST

Sailing across the Atlantic Ocean by himself, in a boat he built himself.

LUNCH SPOT Helio Terra Vegan Café 619 Prospect Ave., Cleveland helioterravegancafe.com

The meal A hummus wrap with water; an antioxidant berry smoothie

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The bill $16 + tip

20160704-NEWS--20-NAT-CCI-CL_--

7/1/2016

11:25 AM

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PRESENTED BY

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FINALISTS & HONOREES ANNOUNCED LIFETIME ACHIEVEMENT AWARD RECIPIENT

INNOVATION CATEGORY - Finalists* • Peggy Corbin, Recovery Resources • John Corn, Northeast Ohio Regional Sewer District • Tony Prinzo, National Interstate

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Public Company - Finalists*

• Lisa Villao, American Greetings Corp.

• Barb Astler, MedData • Maurice Harapiak, Cliffs Natural Resources • Ana Rodriguez, PolyOne Corporation • Kim Whiteman, A. Schulman

LEADERSHIP IN DIVERSITY CATEGORY | TEAM - Award Recipient • KeyBank Brian Fishel (team lead), Mark Novotny, Dawn Roberts, Carole Torres, Luci Workman

Private Company - Finalists* • Jackie Bovinet, ClinicalRM • Judy Collister, Park Place Technologies

Nonprofit / Government Organization - Award Recipient • Denise Smudla, Jennings

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HR TEAM CATEGORY - Award Recipient • Medical Mutual of Ohio Tom Dewey (team lead), Nancy Arthur, Susan Edwards, Patty Hartmann, Susan Oros, Lydia Shinn

PROFESSIONAL DEVELOPMENT - Award Recipient Presented by Corporate College, a division of Cuyahoga Community College

• Courtney DiBello, ValMark Securities

*Award recipients in the HR Executive of the Year Public and Private categories, as well as Innovation and Rising Star, will be announced at the event on Aug. 9.

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