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DEVELOPERS JUMP ON RENTAL DEMAND Oversupply concerns are few amid high apartment occupancy
By STAN BULLARD sbullard@crain.com
A
s Mark Sherman last week welcomed movers hauling his furniture to his new apartment at
the Residences at Hanna in Cleveland’s Theater District, he reflected on how much downtown had changed since he left town five years ago for a job in Honolulu. See RENTAL Page 24
STACI BUCK
Countywide issues are stuffing the ballot box this year Voters will be asked to approve a group of levies that is more crowded than usual By JAY MILLER jmiller@crain.com
40
Elections are always nail-biters for the public agencies and school districts that put money issues before the voters. For this coming Election Day, even the campaign professionals who are paid win or lose are eyeing their fingernails.
The reason is that many of the issues voters will be asked to approve are increases over the existing tax level. There is special concern in Cuyahoga County because of a crowded ballot there. County agencies with taxing authority have been cautious in the past about competing on the same ballot. Had traditional sched-
uling held, only one countywide issue, for the Cleveland Metroparks, would have been on the November ballot. Now, however, voters will face three countywide issues, and two of those could add a total of $148 a year to the property tax bill of the owner of a $200,000 home. The failure of a Cleveland-Cuyahoga County Port Authority issue last year and the decision by Cuyahoga County Council to advance See ISSUES Page 26
KEY BALLOT ISSUES: BY THE NUMBERS A look at the financial impact three notable Cuyahoga County issues would have on taxpayers if voters approve the respective levies on Election Day:
Issue
New mills
Total mills Cost for $200K home
Health and human services
1.0
3.9
$272
Cleveland Metroparks
0.9
2.7
$184
0
0.13
$6.96
Port Authority
■ Sources: Cuyahoga County Board of Election, Crain’s research; Note: Cost is the annual taxes the owner of a $200,000 home would pay if the levy is passed.
0
NEWSPAPER
74470 83781
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SPECIAL SECTION
MEETING AND EVENTS Visitors to the Cleveland Convention Center give favorable reviews ■ Pages 13-21 PLUS: DRAWING A CROWD ■ TIPS FROM THE PROS ■ & MORE
Entire contents © 2013 by Crain Communications Inc. Vol. 34, No. 40
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CRAIN’S CLEVELAND BUSINESS
COMING NEXT WEEK
SEPTEMBER 30 - OCTOBER 6, 2013
STEM sells Metropolitan areas within the Fourth Federal Reserve District, which is based in Cleveland, have seen major growth in STEM (science, technology, engineering, math) and health care jobs lately. Researchers at the Cleveland Fed found “a high and growing share of the district’s labor force” is employed in STEM fields, but employment growth in those areas “has not been able to offset job losses in office administration, production and transportation during the recession.” Here’s how some area metros compare with the United States as a whole:
Where are the jobs? So the economy is supposedly getting better. But who actually is creating jobs? Next week, we’ll tell you which sectors are hot and which are not. Plus, we’ll profile companies creating more than their share of jobs.
Metro
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% of jobs in STEM/health Growth, ’08-’12
Dayton
18.43%
5.50%
Cleveland
16.65%
11.64%
Akron
16.24%
12.57%
Canton
15.28%
3.85%
U.S. average
14.28%
4.80%
Youngstown
13.96%
5.28%
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Howard Hanna branching out Residential brokerage giant adds commercial firepower in its deal with Chartwell Group By STAN BULLARD sbullard@crain.com
Signs for a new commercial real estate brokerage — Hanna Chartwell — formed from familiar names soon will start popping up in Northeast Ohio. Plans call for the venture to spread throughout Ohio, Michigan and other parts of the Midwest in the growing empire of Pittsburgh-based Howard Hanna Real Estate Services, which is the giant in residential real estate brokerage in Northeast Ohio. The name reflects the merger of the Chartwell Group commercial brokerage and auction firm with Howard Hanna, a deal that becomes official Oct. 1, according to Howard “Hoby” Hanna IV, president of Howard Hanna’s Midwest Region. Chartwell is Cleveland-based, as is Mr. Hanna, who runs the company’s Midwest operations.
CRAIN’S CLEVELAND BUSINESS
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INSIGHT
In Pittsburgh, Howard Hanna is a force in commercial brokerage, and Mr. Hanna said his friendship with Chartwell founding principals Mac Biggar and David Hanna IV Wagner — as well as Chartwell’s handling of commercial real estate dispositions for Howard Hanna — opened his eyes to the opportunities in commercial real estate in Northeast Ohio. The combination also fits familyowned Howard Hanna’s penchant for cross-selling. Mr. Hanna said Howard Hanna’s corporate relocation services unit is one of its fastest-growing units, and the firm frequently receives requests to provide commercial services for corporate clients. Hanna Chartwell is organized as a separate company with majority ownership by Howard Hanna and the rest by principals of Chartwell. Mr. Hanna said the merger with Chartwell’s experienced managers gives him enough confidence to accent commercial real See HANNA Page 6
THE WEEK IN QUOTES “With every building we’ve done, we’ve done better. We’re seeing growth in walkable, transit-oriented developments. The growth is where people can walk to work or take public transportation. Millennials are more likely to rent than others.” — Ari Maron, partner, MRN Ltd. Page One
“If we can bring a meeting planner and actually get them on the ground here, they’re impressed.”
“The real power of those forums is the bringing together of attendees to exchange ideas. Business will be done. It will be a catalyst for some type of action.” — Bill Hegarty, chief investment officer, McDonald Partners. Page 4
“It doesn’t mean that at a continental breakfast that you’re still not offering Danish and muffins, but that you’re also incorporating yogurt parfaits and fresh fruit options.” — Joan Rosenthal, Marigold Catering. Page 18
MARC GOLUB
MetroHealth emergency room doctor Sara Laskey once toured the country as a member of the circus.
SMILES ARE PART OF PLAN Patient experience is crucial aspect of healthy outlooks for area hospitals
— Dave Johnson, director of public relations and marketing, Cleveland Convention Center. Page 13
By TIMOTHY MAGAW tmagaw@crain.com
S
ara Laskey, now an accomplished MetroHealth emergency room doctor, knows a few things about making people smile. Before a career in medicine, Dr. Laskey traveled the country as a clown with Ringling Bros. circus, even meeting her husband in the process. See PLAN Page 8
Construction industry is back on solid ground Large projects such as new Eaton headquarters, Ernst & Young building are fueling an optimistic outlook in Northeast Ohio By LAURA STRAUB clbintern@crain.com
Northeast Ohio construction companies are adding inventory and hiring more aggressively in
light of an uptick in building activity in this market and beyond. Spending in commercial and residential construction rose 5.4% in the 12-month period that ended in May, according to data from the
U.S. Census Bureau. Although that’s not a huge increase, it feels big in the construction sector, which was hit hard by the economic downturn. “It’s been quiet so long, it would-
n’t take much to generate an upturn,” said Tom Laird, executive vice president at Gilbane Building Co., a real estate development and construction company. Mr. Laird, who is based in Cleveland, said the Providence, R.I.-based company started seeing the upturn in its five Cleveland-area branches in May. One big factor, he said: “Univer-
sities are spending again.” The increase is not limited to higher education, said Jason Jones, general manager of the Cleveland office of Turner Construction, who has worked on building projects for school districts such as Cleveland, Westlake and Beachwood in the past year. See CONSTRUCTION Page 23
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CRAIN’S CLEVELAND BUSINESS
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Event will be investors’ paradise
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Cleveland conference is headlined by many big-name companies By MICHELLE PARK LAZETTE mpark@crain.com
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Usually, when Eric J. Holmes attends an investment conference to watch top executives present about their companies to investors such as him, he needs a plane ticket and a hotel room. Not this November. The portfolio manager’s travel to a Nov. 19 conference he plans to attend will cost him “a few calories.” For the first time in more than a decade, Cleveland will host an event that brings together institutional investors and companies in which they could invest. Organized by CFA Society Cleveland, the inaugural Midwest Investment Conference boasts some bigname presenters — among them aircraft parts maker TransDigm International Inc., Huntington Bancshares Inc. and polymer producer PolyOne Corp. — and is believed to be the first conference of its kind in this region since those hosted by McDonald & Co., the investment banking, brokerage and advisory firm acquired by KeyCorp in 1998, said Matt Dennis, a member and past president of the CFA Society.
The event has signed up 18 publicly traded companies that will present and meet one-on-one with investors at the Cleveland Convention Center. Registration opened in early September, and institutional investors hailing from Chicago, Indiana, Omaha, Neb., and Pennsylvania already are signed up, Mr. Dennis said. CFA Society Cleveland, a 430member nonprofit trade group for investment professionals, plans to cap the event’s attendance at 200 investors, said Mr. Dennis, senior managing director for Clear Perspective Group, a Medina investor relations consulting firm. Staging a conference in the city presents an opportunity “you don’t get as much in Cleveland” — to interact with other investors locally, said Mr. Holmes, who is portfolio manager, value strategies, for Foundry Partners LLC and attends one or two investment conferences a year, usually in New York. Minneapolis-based Foundry, which has an office in Cleveland, serves institutional investors, primarily pension funds. “It just costs me a few calories to walk over to the convention center,” Mr. Holmes said. “It’s very convenient for me.” In today’s investing world, Mr. Dennis said, investors are going directly to the issuers of public stock “more than they ever have,” and they want access to management. “The need” for events such as this, he said, “is there more than ever.”
Even though the presenting companies pay to present — $2,200 to be exact — a local conference saves them money, too, compared with traveling elsewhere, Mr. Dennis said. “This is one (opportunity) right in their own backyard, so it’s very economical for companies … to attend the conference right here and have qualified investors hearing their stories,” he said.
‘Business will be done’ The format of this conference is not unlike that of those hosted by McDonald & Co. all those years ago: Investors will indicate which companies they’d like to meet with by priority, and will be paired as possible based on the presenters’ preferences. Bill Hegarty, who previously worked for McDonald & Co. and now is chief investment officer for McDonald Partners, a full-service brokerage and investment advisory firm in Cleveland, is pleased to see this type of conference return to the city. “It brings a lot of bright, seasoned people together with company managements, but it also brings those people who’ve been in business for 30, 40 years as analysts (and) portfolio managers with some younger, newer, still-learning analysts (and) portfolio managers,” Mr. Hegarty said. “The real power of those forums is the bringing together of attendees to exchange in ideas,” he said. “Business will be done. It will be a catalyst for some type of action.” ■
Youngstown incubator is expanding Startups in region could benefit from plan to start fund By CHUCK SODER csoder@crain.com
1HHG ÀQDQFLQJ" We’re OLVWHQLQJ Choose CBS UD O\OGH ZDVR DK GH EVM=FMOT DR OHX IMHGH DK HJVMIPHOU \OF VOFHRSU\OF the power of collaboration. DOWHOUMDO\= \OF / O\OGMOT \W\M=\E=H
The Youngstown Business Incubator is working to form a fund that would invest in young tech companies in the Mahoning Valley and surrounding areas, including Cleveland and Pittsburgh. The incubator has identified a lot of people who are “extremely interested” in investing in the fund, which would invest in young software companies and other hightech startups within reasonable driving distance of Youngstown, according to Jim Cossler, the incubator’s leader and “chief evangelist.” “If we’ve got a really hot startup that’s in Bay Village or Westlake, that’s close enough,” Mr. Cossler said. Among the interested parties are investors who have financed some of the 32 software companies housed in the incubator’s fourbuilding campus on West Federal Street in Youngstown. The incubator also is seeing interest from Mahoning Valley natives who have found success in other regions as well as people who’ve donated to the incubator’s ongoing capital campaign, Mr. Cossler said. The process of raising donations for the $2.5 million capital campaign — which has raised $2 million over the past six months — made incubator staff realize its net-
work is filled with people willing to make investments, Mr. Cossler said. “What we’re hearing on making those calls is, ‘Yeah, you know, I’d love to give you a gift, but I’d also like to invest in some of your companies. Can you make some introductions for us?’ ” he said. The fund has yet to be created. However, George Buzzy, who would manage the fund, said plans call for the fund to make investments in the range of $50,000 to $200,000 in each company, while holding an equal amount in reserve for follow-on investments. The fund aims to raise money from individuals and organizations, Mr. Buzzy said. The fund would have a preference for investing in startups developing software for businesses, which is the Youngstown Business Incubator’s sweet spot. However, it also would invest in other “interesting, fast-growing, technologybased companies,” said Mr. Buzzy, who is an entrepreneur-in-residence at early-stage entrepreneurship nonprofit JumpStart Inc. He works with information technology startups, including those at the Youngstown Business Incubator and a smaller, Hudson-based incubator called TECHudson. The fund would avoid startups trying to commercialize pharmaceuticals and certain medical devices that need to go through lengthy testing and regulatory approval processes, said Mr. Buzzy, who also is a partner with two local investment firms, AG Partners and Blue Olive Partners.
Digging up dollars In addition to making money, the
fund also looks to meet a need in Northeast Ohio’s economy, he said. Mr. Buzzy said he believes there are a lot of companies in Northeast Ohio’s startup community that are worthy of investment but can’t find the cash. “Demand certainly exceeds supply,” he said. Local companies that receive early-stage financing today may face challenges tomorrow. In Northeast Ohio and nationwide, the venture capital firms that many startups rely on have had a hard time raising money lately. That situation “poses a challenge not just to a YBI fund but certainly to funds like ours,” said Clay Rankin, managing member of North Coast Angel Fund, which invests in Ohio startups using contributions from individual investors. Nowadays, Mr. Rankin’s fund is putting more focus on making sure its startups can survive longer before they need money from larger investors, Mr. Rankin said. He described an instance in which North Coast Angel Fund helped one of its portfolio companies round up more cash from existing investors to get the company to the point where it can attract new investors. Despite that challenge, Mr. Rankin said he encourages the Youngstown Business Incubator’s efforts. Like Mr. Buzzy, he said the incubator’s effort could help the local capital supply catch up with demand from local startups that deserve the money. “I think there are many more companies and ideas that are percolating in the region … than I think there is adequate capital to support them,” Mr. Rankin said. ■
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Volume 34, Number 40 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of December and fifth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright © 2013 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877-824-9373. REPRINT INFORMATION: 800-290-5460 Ext. 136
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5
Loan helps plastics company see fresh growth New Wave Plastics buys two new machines and expects to increase its production by one-third
“We’ve eliminated pretty much all the paperwork in the plant.” – T.R. Mitchell, CEO, New Wave Plastics
By RACHEL ABBEY McCAFFERTY rmccafferty@crain.com
New Wave Plastics has invested in a new automated tie-baling system and a size-reduction machine, increasing the recycling capabilities of its plant at 5500 Walworth Ave. in Cleveland. The equipment investments were made using a $1.6 million Small Business Administration loan from KeyBank that New Wave Plastics received in May, said CEO T.R. Mitchell. The plastics and industrial waste recycler last year saw about 45 million pounds of plastics flow through its plant, Mr. Mitchell said. This year, the company expects that figure to reach about 60 million pounds — and the growth is expected to continue in 2014. New Wave Plastics buys scrap material from companies and processes the plastic in the Cleveland plant. The company then sells the plastic material in a powder or granulized form to end users, who create new materials from it. New Wave Plastics specializes in processing PVC, Mr. Mitchell said, but it has expanded into other plastic compounds and plans to begin handling other types of polymers in the next two years. The new equipment has increased the company’s processing capabilities. Before buying the baling machine, which arrived last
CONTRIBUTED PHOTO
New Wave Plastics’ new tie-baling machine can bale about 10 tons of plastics in an hour. month, employees baled the plastic scrap by hand, and the company could bale about one ton an hour, Mr. Mitchell said. Now, the machine can bale about 10 tons of plastics in an hour by itself — a “major accomplishment,” Mr. Mitchell said. And the size-reduction machine, which is due to arrive in September and will have metal separation capabilities, will be able to process about 10 million pounds of plastic per year on just that one line. The machine will break down the plastic into small parti-
Inspire
cles. Prior to the investment in the new equipment, New Wave Plastics in March also invested in a new computer system that allows for real-time inventory tracking and customer management.“We’ve eliminated pretty much all the paperwork in the plant,” Mr. Mitchell said. New Wave Plastics hired another seven employees to work on the floor in Cleveland this past year, Mr. Mitchell said. He plans to hire another two sales employees in the next
Success at CLEVELAND BOTANICAL GARDEN
year. The company has about 45 employees in Cleveland, said Mr. Mitchell, who declined to disclose New Wave Plastics’ annual revenue. An SBA loan — which has a longer term, lower payments and a partial guarantee from the U.S. Small Business Administration — is a common choice for businesses with growth opportunities, said John Moshier, senior vice president and national SBA manager at KeyBank. The companies need to leverage up to continue to grow, he said, and these allow companies to use less collateral and to reduce their payments. New Wave Plastics’ story of being able to restructure its debt and invest back into the company is a good one, Mr. Moshier said. KeyBank even is using New Wave Plastics as an example on its website of how the SBA 7(a) loan program has helped the company reinvest and grow. The growth in business at New Wave Plastics is due to an increase in demand for recycled materials and a contraction in plastic waste exports, Mr. Mitchell said. China’s government has been cracking down on the amount of waste it brings into the country. That situation opens possibilities for domestic waste processors such as New Wave Plastics, Mr. Mitchell said. Director of sales Doug Coates said New Wave Plastics also sets itself apart by taking all industrial waste — not just plastics — and using the company’s sales team to find homes for what it can’t process. ■
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Fairmount finds gold with sand Chesterland-based company adds mining operation in Texas as part of busy 2013 By DAN SHINGLER dshingler@crain.com
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It might not be possible to corner the market on something as common as sand, but Fairmount Minerals is at least becoming one of the big kids in the box, thanks to an ongoing string of acquisitions. Fairmount on Sept. 6 closed its third deal this year, and with it, the Chesterland-based company brought aboard a mining operation in Voca, Texas, two industrial sand processing operations in Wisconsin and resin-coating operations in Illinois and Texas. “We did not have any facilities in Voca, Texas, and that (acquisition) will add another product line for us in the brown sand market,” said Fairmount spokeswoman Kristin Lewis. “They’re calling it Texas gold,” Ms. Lewis said of the sand her company will begin producing in the Lone Star State. Fairmount’s newest assets were purchased from Texas-based FTS International; the two private companies did not disclose terms of the transaction. The latest deal is part of a string of acquisitions Fairmount has made to expand and cement its position in the nation’s growing market for fracking sand. The sand is used by oil and gas drillers conducting horizontal drilling and hydraulic fracturing of shale deposits that hold vast amounts of natural gas and crude oil. In May, Fairmount announced it was acquiring new technology from Massachusetts-based Soane Energy that’s designed to help suspend sand, known as “proppants” inside the liquids that drillers use to frack their wells. That transaction was followed in June by the announce-
ment that Fairmount was buying a northern white sand mine from Great Planes Sand in Minnesota.
Moody’s weighs in Fairmount does not release its financial data, but one person familiar with the company estimated the company now sells more than $1 billion of sand a year, most of it for fracking. The acquisitions might have the company maxed out for the time being, though, according to Moody’s Investor Services, which in August assigned a B1 rating to a proposed $1.285 billion senior secured credit facility Fairmount was securing to manage its debt. Overall sand sales have been rising, but demand for special coated sand, which affords Fairmount higher margins, had softened somewhat, Moody’s noted. And the recent acquisitions had left Fairmount with relatively low levels of cash. “Fairmount is expected to have a relatively low liquidity position after the acquisition of FTSI’s assets with a low cash balance of approximately $5 million and modest borrowing availability of approximately $25 million,” Moody’s wrote. Still, the ratings agency did not sound worried, and echoed some of what Ms. Lewis has been saying about how the company will turn its new assets into new revenues. “However, it is Moody’s expectation that (Fairmount) will begin to generate significant positive free cash flow over the next 12 to 18 months as capital investments decline from an elevated level and cash is generated by the acquired assets,” Moody’s wrote. That’s pretty much the plan, according to Ms. Lewis, who said the latest acquisition gives Fairmount more than 50 distribution points that
can handle loads of 100 rail cars at a time. The company’s strategy includes owning more, and bigger, terminals that are closer to the nation’s shale plays, where drillers need sand delivered often and on time.
‘Game changer’ coming There’s no sign that the oil and gas industry’s need for sand is slowing, either. The amount of sand mined each year has been rising rapidly and up to 40 million metric tons are expected to be mined this year, according to a recent report on the industry by National Geographic Society. That’s because there are more wells fracked each year and, according to the Minnesota Department of Natural Resources, it takes up to 10,000 tons of sand to frack each well, along with millions of gallons of water. If Moody’s is correct, Fairmount might now be in digestion mode rather than on the hunt for new deals. But Ms. Lewis said the company continues to scout opportunities, ranging from acquisitions it can make later to new technologies it can apply to its existing business. All sand is not created equal, which is why certain deposits of uniform, fine sand are in demand. But even that sand can be made better by applying specialty coatings and through other processes. Fairmount is acquiring such technology, like it did in May with the Soane Energy deal. “There’s going to be a game changer pretty soon,” Ms. Lewis said, referring to Fairmount’s ongoing research-and-development activities. In the meantime, she said, the company is securing long-term contracts with more customers, building its distribution network and adding to its reserves of sand to mine later. “We’re excited about it — it’s a great opportunity for us,” Ms. Lewis said. ■
Hanna: Company believes it has ‘it all’ continued from PAGE 3
estate as part of the firm’s suite of services. “When we engage commercial clients, we can say, ‘We have it all for you,’ ” Mr. Hanna said.
Playing hard to get no more For the 15-agent Chartwell firm, affiliating with Howard Hanna provides capital and a platform to grow as consolidation again is sweeping commercial real estate brokerage. Although the parties described it as a merger, an undisclosed amount of funds changed hands to accomplish the formation of the joint venture. “They paid more than they wanted to and less than we wanted,” Mr. Biggar said. Mr. Hanna added quickly, “Which is always the basis of a good deal.” Chartwell has been courted by national brokerages wanting Cleveland offices for years, Mr. Biggar said. “We’ve played hard to get long enough and decided it was time to be gotten,” he said. Mr. Wagner said Chartwell appreciated Howard Hanna’s commission levels, though he declined to go into more detail. He also noted that Howard Hanna’s vast office
and residential agent network can provide multiple leads. When word of a potential combination between the two organizations surfaced in late August, outside speculation focused on Howard Hanna’s possible interest in Chartwell’s well-known, national auction unit. Mr. Wagner said interest in that business was important from Chartwell’s side, because it wanted to find a partner that appreciated and valued the company’s accelerated marketing division. Over the last decade, auctions have gained a significant role in commercial real estate brokerage because of their ability to locate strong buyers quickly.
What’s in a name? Within the Howard Hanna corporate framework, its Pittsburgh commercial unit will remain independent from Hanna Chartwell. A commercial practice in Green that Howard Hanna launched when a handful of commercial brokers active in Stark and Summit counties joined the firm two years ago will become part of Hanna Chartwell. Some agents will move from Green to Hanna Chartwell’s office, which will remain in
Erieview Tower in Cleveland, a leasing assignment for Chartwell. All of Chartwell’s five principals are continuing in the new venture. Key Chartwell agents David Stover, Mark Abood and auctioneer Michael Berland also were named principals in Chartwell’s portion of Hanna Chartwell. Although Ohio incorporation records filed last month used the Howard Hanna Chartwell name, the final version of the combined company’s moniker is shorter. Mr. Hanna said there is value in the Chartwell name and he did not want to see it go away or create a cumbersome new name. “It was OK with the Howards to drop it from the name, and I’m one of them,” Mr. Hanna said. He then added, “We like their colors.” That is a reference to the firms sharing a green background on logos, although Howard Hanna’s lettering is yellow and Chartwell’s is white. The Howard Hanna firm encompasses 147 offices and 4,700 agents and ranks as the nation’s fourthlargest residential brokerage. Chartwell was formed in 1991 when Messrs. Biggar and Wagner exited Cleveland-based Ostendorf-Morris Co. ■
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Lakewood is experiencing culinary ‘rejuvenation’
D
iners willing to wait hours in line for modern Mexican cuisine at Momocho now are also swooning over its new cousin in the Cleveland area’s latest restaurant hot spot — Lakewood. El Carnicero, a 150-seat tamaleria and taqueria that is triple the size of esteemed chef Eric Williams’ Ohio City flagship, is his most recent project and his first in Lakewood. It is located in the space formerly occupied by McCarthy’s Ale House on Detroit Avenue. Mr. Williams carefully chose the neighborhood because of its thriving culture, population density and diverse restaurant scene that he says compares to Cleveland’s Ohio City, Tremont and East Fourth Street neighborhoods. “I want to be part of Lakewood’s rejuvenation,” Mr. Williams said. The chef’s foray into Lakewood illustrates the accelerating culinary firepower of the inner-ring suburb. Lakewood over the last couple years has deviated from its reputation as a community with a bunch of watering holes into an area with an evolving restaurant scene that is playing a significant role in its economic development strategy. “We’re moving away from being a city with a lot of bars into a neighborhood that has quality restaurants with bars,” said Dru Siley, the city’s planning and development director. “We’re actually in the process of updating our community master plan to develop a strategy that more actively promotes these quality restaurants.” The city also is allocating $2.5 million in municipal infrastructure improvements on Madison Avenue to emulate the rejuvenation of Detroit Avenue, one of the city’s main arteries. Up until a couple years ago, Lakewood had been underserved in dining, said Mr. Siley, noting that higher-caliber establishments had been limited to a few longstanding institutions such as Pier W, Three
KATHYAMESCARR
WHAT’S COOKING Birds (now Georgetown), Players on Madison, Angelo’s and relatively new additions such as Melt Bar & Grilled, which opened there in 2006 and now has four locations in Northeast Ohio. “Then (Dan) Deagan opened Deagan’s (in 2010), which replaced Crazy Rita’s (a bar), and he just doubled down on the city with Humble Wine Bar,” Mr. Siley said, referencing the wine bar/tapas concept that opened in August just three blocks west of Mr. Deagan’s upscale gastropub on Detroit Avenue. Barroco Grill, Jammy Buggars and others that have been heralded in local and national media for their diverse culinary offerings have emerged since.
Walk this way More young professionals and younger families are populating the dense community for its energy, walkability, access to the urban core and a dynamic food and culture scene. Indeed, according to a February study from Case Western Reserve University’s Center on Urban Poverty and Community Development, Lakewood ranked the highest in Cuyahoga County in population gains of 25- to 34-year olds from 2000 to 2010, with 3,148 residents in that group, followed by downtown at 1,842. As the demographic changes, so too has the quality of the neighborhood’s dining and drinking establishments; they are appealing to the quality-conscious tastes of the in-
ON THE WEB Read Kathy Ames Carr’s What’s Cooking blog at: www.crainscleveland.com fluential younger and middle-age residents and employees of more than 1,000 businesses located in Lakewood. “Some of the First Federal staff jokingly refer to Deagan’s as conference room D,” Mr. Siley said, referring to the savings and loan based in the town. In total, 28 eateries since 2010 have entered the market, with half of those — most locally based and independently owned — opening in 2013, including Barrio, Eddie Cerino’s Casual Italian and StrEat Burger. Look for similar concepts to open later this year and early 2014, including Cleveland Pickle (Nov. 1); Braised (late 2013), which will feature braised meats and a high-end menu; Stackers (late 2013); and Sushi Raxu (early 2014). “We’ve experienced exponential growth, not just in the number but in the quality of restaurants,” Mr. Siley said. “We’re seeing substantial investments in these concepts, with people completely gutting and rehabbing buildings,” with those investments typically ranging from $250,000 to $500,000, he said. “These are restaurateurs who are in it for the long haul,” Mr. Siley said. ■
MARC GOLUB
Chef Eric Williams opened El Carnicero, a 150-seat tamaleria and taqueria, in Lakewood.
“We’re moving away from being a city with a lot of bars into a neighborhood that has quality restaurants with bars.” – Dru Siley, planning and development director, Lakewood
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Plan: New roles are ‘not always easy’ continued from PAGE 3
So, when Dr. Akram Boutros, MetroHealth’s CEO, was looking for a leader of an initiative to improve the health system’s customer service and shatter negative perceptions patients might have of the hospital, he figured, “Who better than someone whose job it was to create joy?” Now, besides handling logistics of MetroHealth’s emergency department, Dr. Laskey boasts the new title of chief experience officer — basically, a job that puts her in charge of keeping patients happy. It’s an increasingly important role as hospitals eye the possibility of seeing more of their reimbursements tied to the results of patient satisfaction surveys designed by the federal government. And it isn’t a cushy gig — or a laughing matter. “Patients and their families are not always easy,” Dr. Laskey said. “We don’t get them when they’re happy and feeling good and not scared.” Dr. Laskey and her “patient experience” counterparts at other hospitals aren’t so much tasked with ensuring the care is top notch. In many cases, these hospitals already boast top-flight clinical programs. Instead, the patient experience czars are charged with ensuring hospital employees — doctors, nurses, cooks, greeters, housekeepers, whoever — support an environment that puts patients at the forefront. “Patients belong to all of us,” Dr. Laskey said. “That’s the first thing we will all understand.” University Hospitals, too, is looking to make strides in the area of patient experience. Over the last few years, UH significantly has im-
proved its clinical outcomes, culminating with the American Hospital Association naming its flagship hospital the best in the country in terms of quality. The health system hopes to apply the same principles it used to boost quality to improve patients’ perceptions of the enterprise. “It’s a journey,” said Catherine Koppelman, who recently took on the role of patient experience officer in addition to her duties as UH’s chief nursing officer. “It’s not something when you’re there, it’s fixed. You have to constantly be attending to it.”
Upping the score In health care circles, the Cleveland Clinic is regarded as a pioneer in the patient experience arena, though its efforts date back only about four years. The Clinic was one of the first — if not the first — to have a C-suite executive to oversee its patient experience efforts, a role held since 2009 by Dr. James Merlino, a colorectal surgeon. Last spring, Dr. Merlino and Ananth Raman, a Harvard University professor, outlined the Clinic’s progress in this area in an exhaustive piece in Harvard Business Review. Since its launch, the Clinic’s patient experience office has morphed into a $9.2 million operation with more than 100 employees — and its efforts haven’t been for naught. The health system’s overall ranking in the feds’ patient satisfaction surveys increased to the 92nd percentile in 2012 from the 55th percentile in 2008. MetroHealth, on the other hand, hopes to boost its patient satisfaction scores to the 45th percentile this year from the 15th percentile.
One way Dr. Merlino said the Clinic raised those scores was by requiring all of its 40,000-plus employees — janitors, docs, nurses, everyone — to participate in roundtables and to talk about their work and how they could do it better. The idea is to identify everyone, not just the clinical staff, as caregivers. Other steps the Clinic has taken include same-day appointments, rooftop yoga, redesigned patient gowns and art programs. “It’s palpable,” said Dr. Merlino, the Clinic’s chief experience officer. “People come here now and say it feels different.” MetroHealth’s Dr. Laskey is so keen on the Clinic’s patient experience efforts that she plucked Mary Linda Rivera, one of the Clinic’s top patient experience execs, to help jump-start MetroHealth’s initiatives. She also expects to adopt the Clinic’s idea of “leadership rounds,” where administrators cross-pollinate personnel in different areas of the organization, interview patients and take best practices from department to department. UH wants to expand the role of its patient and family advisory councils — volunteer bodies where UH staff interact with former patients and their families to discuss ways to improve care. As indicated by the patient satisfaction surveys, one concrete way UH Case Medical Center could improve its scores is by ensuring the hospital is quieter. “It’s about doing things in an authentic, respectful and caring way,” Ms. Koppelman said.
Tug the purse strings Over the last year, almost $1 billion in hospitals’ Medicare reim-
MCKINLEY WILEY
Catherine Koppelman recently took on the role of patient experience officer in addition to her duties as University Hospitals’ chief nursing officer. bursements were tied to patient satisfaction surveys, and that figure is expected to double by 2017. The feds have surveyed patients on their experiences since 2006, but the monetary tie-in is a fairly new development. Survey questions include: “How often did doctors listen carefully to you?” and “How often did nurses treat you with courtesy and respect?” Responses are reported publicly to the Centers for Medicare & Medicaid Services and posted on the web at www.medicare.gov. Given that commercial insurers often follow Medicare’s lead, some experts foresee an era when commercial insurers use patient satisfaction metrics as leverage when negotiating how much they pay providers. “Hospitals are paying much more attention to this that they ever did,” said Thomas Campanella, executive director of the health care MBA program at Baldwin Wallace University. “Putting dollars on the line, as you would expect, would get somebody’s attention.” Also, Cleveland is an incredibly competitive health care market, and hospitals constantly tout their achievements in areas such as cost and clinical outcomes. Patient
experience could be another one of those benchmarks proclaimed on billboards along the highway. (Just imagine: Quietest hospital in Northeast Ohio.) Mark Votruba, an associate professor of economics at Case Western Reserve, sees a self-preservation element to hospitals’ patient experience push. “I think a lot of the health systems are nervous about what is going to happen over the next 10 years,” Dr. Votruba said. “There’s pressure put on them to reduce costs, and it’s going to mean everybody’s not doing as well in the future as they are right now. “You better position yourself to be as attractive as possible,” he said. “It’s not clear all of the same players will be in game later on.” Of course, while the budgetary tie-in surely piqued the interests of some hospital executives, ensuring patients are in high spirits isn’t purely a financial decision. “The patient needs to believe that you care about them as an individual,” said MetroHealth’s Dr. Boutros. “They need to know that they’re not just a disease entity or a nameless, faceless number in an assembly line. They need to know we are listening.” ■
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TAX LIENS The Internal Revenue Service filed tax liens against the following businesses in the Cuyahoga County Recorder’s Office. The IRS files a tax lien to protect the interests of the federal government. The lien is a public notice to creditors that the government has a claim against a company’s property. Liens reported here are $5,000 and higher. Dates listed are the dates the documents were filed in the Recorder’s Office.
LIENS FILED William E Crowe MD Inc. 6631 Ridge Road, Suite 204, Parma ID: 30-0019966 Date filed: Sept. 19, 2013 Type: Employer’s withholding, unemployment, corporate income Amount: $12,446 Renaissance Center for Comprehensive and Cosmetic Dentistry 2211 Crocker Road, Suite 110, Westlake ID: 01-0688742 Date filed: Aug. 1, 2013 Type: Employer’s withholding, unemployment Amount: $11,409 Chemam Inc. 250 Richmond Road, Cleveland ID: 34-1473868 Date filed: Aug. 19, 2013 Type: Employer’s withholding, failure to file complete return Amount: $10,574 Wanton-Horne Chapel of Peace Funeral Home Inc. 12519 Buckeye Road, Cleveland ID: 34-1725612 Date filed: Aug. 6, 2013 Type: Employer’s withholding Amount: $10,555 Auto Kingdom Inc. 10421 Lorain Ave., Cleveland ID: 26-3990800 Date filed: Aug. 6, 2013 Type: Employer’s withholding Amount: $10,016 High Point Marathon Ltd. 7411 State Road, Parma ID: 41-2236231 Date filed: Aug. 6, 2013 Type: Employer’s withholding Amount: $9,938 Euclid Day Care Academy Corp. 567 E. 200th St., Euclid ID: 90-0745959
Date filed: Aug. 1, 2013 Type: Employer’s withholding Amount: $9,934 Packaging Machinery Services Inc. 20001 Euclid Ave., Euclid ID: 34-1187804 Date filed: Aug. 19, 2013 Type: Employer’s withholding Amount: $8,801 Tiburon Technologies P.O. Box 40476, Cleveland ID: 34-1744650 Date filed: Aug. 1, 2013 Type: Unemployment Amount: $8,655 Medical Care Center LLC 1250 Superior Ave. E, Cleveland ID: 34-1905631 Date filed: Aug. 27, 2013 Type: Employer’s withholding Amount: $7,082 Anthony Roccos Hair Design 6124 Highland Road, Highland Heights ID: 04-3726680 Date filed: Aug. 1, 2013 Type: Unemployment Amount: $6,011 Latter Enterprise 112 Prospect Ave. E, Cleveland ID: 37-1512257 Date filed: Aug. 19, 2013 Type: Employer’s withholding, unemployment Amount: $5,980 Harold Pollock Co. LPA 5900 Harper Road, Suite 107, Solon ID: 34-1530164 Date filed: Sept. 27, 2013 Type: Employer’s withholding, unemployment Amount: $5,409
First Choice Homecare Inc. 601 Towpath Trail Suite C, Broadview Heights ID: 34-1876809 Date filed: May 2, 2013 Date released: Aug. 6, 2013 Type: Employer’s withholding Amount: $53,456 Integrity Investigations LLC 1991 Crocker Road, Suite 600, Westlake ID: 20-1915641 Date filed: April 12, 2010 Date released: Aug. 27, 2013 Type: Employer’s withholding, unemployment, failure to file complete return Amount: $13,167 Legal Structures Inc. 17126 Catsden Road, Chagrin Falls ID: 34-1924752 Date filed: April 10, 2012 Date released: Aug. 27, 2013 Type: Employer’s withholding Amount: $6,146 Meroe Contracting & Supply Co. 6944 W. Snowville Road, Brecksville ID: 34-1313288 Date filed: Nov. 18, 2003 Date released: Aug. 6, 2013 Type: Employer’s withholding Amount: $180,814 Mic Ray Metal Products Inc. 9016 Manor Ave., Cleveland
ID: 34-0699197 Date filed: April 11, 2013 Date released: Aug. 6, 2013 Type: Employer’s withholding Amount: $32,421 Neteam Avi LLC Zenith Systems LLC 5060 Corbin Drive, Bedford Heights ID: 52-2405579 Date filed: Jan. 24, 2012 Date released: Aug. 6, 2013 Type: Civil penalty assessment Amount: $69,832 Parkside Grille Inc. 8 Plaza Drive, Chagrin Falls ID: 34-1855909 Date filed: April 23, 2013 Date released: Aug. 19, 2013 Type: Employer’s withholding Amount: $5,910 River Contractors Inc. 6916 Parma Park Blvd., Cleveland ID: 34-1541447 Date filed: Dec. 3, 2004 Date released: Aug. 6, 2013 Type: Employer’s withholding, unemployment Amount: $7,753 Royal T Remodeling Inc. 11462 Drake Road, North Royalton ID: 34-1862463 Date filed: Nov. 30, 2010 Date released: Aug. 19, 2013
Type: Employer’s withholding Amount: $5,038 Rybak & Associates Inc. 21821 Libby Road, Suite 102, Bedford ID: 03-0514289 Date filed: Jan. 9, 2013 Date released: Aug. 1, 2013 Type: Employer’s withholding Amount: $16,870 J Schrader Co. 4603 Fenwick Ave., Cleveland ID: 34-0207795 Date filed: July 29, 2010 Date released: Aug. 19, 2013 Type: Employer’s withholding Amount: $19,633 Signature Interiors Inc. 13275 Strathmore Drive, Valley View ID: 34-1881664 Date filed: Dec. 9, 2009 Date released: Aug. 27, 2013 Type: Employer’s withholding, unemployment Amount: $48,928 Skok Industries Inc. 26901 Richmond Road, Bedford Heights ID: 34-1149494 Date filed: Aug. 10, 2010 Date released: Aug. 27, 2013 Type: Employer’s withholding Amount: $84,291
Crain’s is Cleveland Business
Quick Employment LLC P.O. Box 93722, Cleveland ID: 04-3788598 Date filed: Aug. 27, 2013 Type: Employer’s withholding Amount: $5,405
LIENS RELEASED Cardiology Associates of Cleveland Inc. 12000 McCracken Road, Suite 460, Garfield Heights ID: 34-1358270 Date filed: Oct. 31, 2011 Date released: Aug. 27, 2013 Type: Employer’s withholding Amount: $23,959
FlashStarts invests in software developer The FlashStarts ON THE WEB Story from SEC added a new business accelerator www.crainscleveland.com rule requiring companies to has made a follow-on verify that the people they’re raising investment in a startup company money from have enough income that aims to help other startups and assets to qualify as accredited attract investments of their own. investors. Most of FlashStarts’ follow-on inCrowdentials’ software “is already vestments will be in the range of gaining traction in the marketplace,” $50,000 to $300,000, but the according to a statement from Cleveland-based accelerator did not FlashStarts founder Charles Stack, disclose the exact amount it investwho has started multiple local ed in Crowdentials, which has develsoftware companies. oped software designed to help “General solicitation will transform startups confirm whether potential the investment landscape, enabling investors are accredited. startups and other groups to raise It’s a timely investment. Starting money without regard to last Monday, Sept. 23, it became geographic limitations,” Mr. Stack legal for startups and other compasaid in the statement. nies to announce publicly that they The FlashStarts accelerator alare looking for investments. In July, ready made a smaller investment in the U.S. Securities and Exchange Crowdentials. FlashStarts made Commission voted to get rid of a investments of up to $20,000 in rule that banned private companies each of the 11 companies that enfrom publicly announcing that they tered the 3-month-long accelerator are looking for investors. program in June. — Chuck Soder At the same time, though, the
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PUBLISHER/EDITORIAL DIRECTOR:
Brian D. Tucker (btucker@crain.com) ASSOCIATE PUBLISHER/EDITORIAL:
John Campanelli jcampanelli@crain.com) EDITOR:
Mark Dodosh (mdodosh@crain.com) MANAGING EDITOR:
Scott Suttell (ssuttell@crain.com)
OPINION
Overdue view
G
reater Cleveland has plenty of streets, roads and highways in need of repair, but a finite amount of money to fix them. The dilemma calls for the establishment of a pecking order for these essential expenditures. Grace Gallucci wisely wants to bring big data to the rescue. Ms. Gallucci is executive director of the Northeast Ohio Areawide Coordinating Agency, a planning body that sets the transportation investment agenda in Cuyahoga, Geauga, Lake, Lorain and Medina counties. She wants to create a unified database that would contain assessments of the condition of every street and roadway — in every community — in all five counties. This first detailed look at the entire region would be a much-needed overview of the state of the area’s streets and byways. The quality of the surfaces on which people and goods move significantly influences the economic health of a region. If they have a choice, residents and businesses will avoid places where streets and main transportation arteries are substandard and don’t receive the investments necessary to bring them up to speed (pun intended). So, it is important to determine the greatest need and how precious transportation dollars can be spent to the best effect. Of course, all the data analysis in the world won’t do much good if funds are so tight that only the worst or most-traveled roadways sop up most of the money available for NOACA’s repair efforts. It is why we repeat our recent call for the Legislature to approve and for Gov. John Kasich to sign a bill that would raise the state’s gasoline tax, which hasn’t been increased since 1993. Gas tax revenue is the lifeblood of agencies such as NOACA, and the need to provide more money to do their jobs is great. A modest increase in the gas tax would be the right step to help transportation planners do their jobs in a state where the population is stagnant and the improved fuel efficiency of vehicles holds down gasoline consumption.
Lake view
I
n the world of government largesse, $3 million isn’t a lot of money. However, the additional $3 million Gov. John Kasich announced last week that the state will direct toward a makeover of the West Shoreway was a welcome affirmation of the effort to turn a highway that races past some of Cleveland’s best waterfront assets to a boulevard that enhances Lake Erie access. It is a goal of Mayor Frank Jackson to make Cleveland “a city that emanates from the lake.” Turning the Shoreway into a 35-mph roadway would help connect the water with neighborhoods south of the thoroughfare and could boost ongoing efforts to reinvigorate them. We like and encourage this plan.
FROM THE PUBLISHER
A guided tour of Cleveland’s resurgence eSquare theaters, and I could tell them ecently, I was with a friend and about the dramatic changes coming to his pals in Akron and the topic of further enhance that jewel of a Cleveland restaurants neighborhood. We’d stroll came up. Most every- BRIAN along West 25th Street and see one in this group had been to TUCKER all the new housing, retail and some of our town’s newest, exdining near the venerable West citing eateries, from Little Italy Side Market. We’d drive to the Warehouse District. But through Tremont and the Gorlater in the day, some of those don Square Arts District. I’d same guys remarked that Cleveshow them all the new housing land was unsafe and, apparentbeing built around a remade ly, doomed to disintegrate. Cleveland State University It was such an amazing discampus. connect that it made me think a Of course, we couldn’t miss the new bit about how parochial our thinking can convention center and connected Cenbe (to say nothing about how many conter for Global Health Innovation. Or the clusions are based on presumption, nearby county building that’s coming rather than fact). To my further astonishdown to make way for a new convention ment, one of the young men was runcenter hotel. ning a development business based in a Then I’d drive them along Euclid Avsouth Cleveland suburb. enue, where the Healthline bus-rapid I wanted to ask them to come to transit has sparked an amazing amount Cleveland and take a tour with me of redevelopment, and then we’d visit through the downtown and neighborthe astonishing new home of the Musehood areas that are so dramatically imum of Contemporary Art and the nearby proving. I wanted to tell them — actualUptown District next to Case Western ly, I did — about the boom in downtown Reserve University’s campus. residential housing, and how developers And that, as we all know, is just a piece can’t get enough projects started to keep of all that’s happening to remake Cleveup with demand. We could walk through the Playhousland. Are there problems? Certainly, but
R
It was such an amazing disconnect that it made me think a bit about how parochial our thinking can be. none that are different than those afflicting all of America’s older urban centers — poverty, underperforming schools, crime. But we are experiencing a sea change in America, and the next generations are coming back to the cities. And they seem intent on staying — a factor that will help to resuscitate these once-great city centers. They want no part of their parents’ suburban life, with their long commutes to town. Recently, K&D Group, the big local apartment developer, wrapped up a deal to remake the old East Ohio Gas headquarters building — with its valuable attached parking deck — into upscale apartments. Just a couple blocks away, the grand old school administration building is being redone into a sophisticated boutique hotel. Cleveland is being reborn, and that’s good news for everyone in the region, even our friends in Akron. ■
TALK ON THE WEB Re: Cavaliers embrace data ■ Kerry Bubolz is one of the sharpest people in the pro sports business in the country and we are lucky to have him in Cleveland. The Cavs are always thinking out of the box and a big reason is because Bubolz is always pushing the edges for more. What I most like about him is the way he encourages his team to create new sources of revenue without ever going to the taxpayer for a handout. — JB Vick
Re: University Square shopping center auction ■ This design/concept was deeply flawed from the outset. It would seem the first rule of retail is “make it easy for the customer to find the front door.” I
Reader responses to stories and blogs that appeared on: www.crainscleveland.com
wonder who provided the original financing and what they were thinking at the time. — Murlan Murphy
Re: Newspaper’s future ■ The Plain Dealer has gone from being a full service newspaper to being a content farm. The difference is between journalism and junk mail. How foolish do the newspaper’s owners think we are by asking readers to believe that the “quality” of the product will be the same after laying off half the newsroom staff? As I see it, the best outcome for Cleve-
land could be for Advance to sell the newspaper to an investor who understands 21st century media. That’s what The Washington Post did just a few weeks ago. Are there others who want to follow that model? Then come to Cleveland, because it could be there will be a media property here for sale in the not too distant future. — Daniel Yurman
Re: UH proton therapy center ■ As a UH employee, I am proud to see the investment our hospital is making in groundbreaking equipment that will help treat cancer in our youngest patients in new and different ways. — Mark Madere See WEB Page 11
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PERSONAL VIEW
Marketplace Fairness Act is anything but We are ERIEVIEW for companies that depend on catalogs
..
By LOUIS GIESLER
W
hen I tell people about AmeriMark Direct and the significant number of handwritten catalog orders we receive through the mail each year, they’re typically shocked. They then look at me like I’m about to brag that we also have running water and electricity. But at AmeriMark, we’re anything but old-fashioned. We’re a direct marketing company with 10 distinct catalogs striving to serve the needs of our older, value-conscious customers. Last year, more than one-third of our orders — nearly 3 million — were made by people who filled out an order form and mailed it in. Unfortunately, the Marketplace Fairness Act is poised to crush that statistic, and unless we contact our elected officials and demand sensible simplifications, it will start a snowball effect that will destroy customer loyalty, dismantle honorable businesses and eliminate jobs. My biggest fear, though, is that the act will frustrate and disenfranchise millions of seniors who depend on catalog purchases to help make their lives safer, easier and more enjoyable. The Marketplace Fairness Act was pushed through the U.S. Senate in May and is under consideration in the House. It requires “remote sellers� (including catalog retailers and online stores) doing $1 million of revenue or more annually to collect taxes for every state, Indian tribe, and jurisdiction where
Mr. Giesler is president of AmeriMark Direct in Cleveland. they have customers. For the record, that’s more than 10,000 tax jurisdictions, each having its own rates, definitions, exceptions, tax holidays, and product exemptions. Consider this example: A woman in New York orders a dress, a pair of shoes, a diet supplement and a blood pressure monitor from one of our catalogs. I’m an accountant by training and it took me more than 20 minutes to calculate the taxes, and I’m still not sure I got them right. When I learned about the Marketplace Fairness Act, I summarized all the possibilities nationwide for our mail-order customers. Our best solution so far is a 40-page (and growing) insert of tax rates and exceptions that customers would use to calculate taxes for their mail orders. This insert — which is almost as large as some of our catalogs — would take the place of two small boxes on our current order form. I can’t even begin to imagine how many customers will become so frustrated by the inconsistent and tangled state taxes that they simply will give up and stop ordering. The act’s backers aren’t concerned with that, though. They talk about needing to level the playing field to benefit local vendors who are forced to charge sales tax. But you can’t achieve fairness if you impose a tax system that is so confusing that millions of discouraged buyers stop ordering by mail alto-
gether and compliance is so expensive that it leads to increased costs, which bleed down to customers. This hardly levels the playing field. The Marketplace Fairness Act also will create compelling uncertainty for AmeriMark. The unknown impact on catalog mail orders, coupled with the act’s compliance costs, may significantly shrink our company, resulting in employee layoffs and decreased product offers to our senior customers. When Congress debates the act, it must not do so in a vacuum, but through the context of the millions of families that will be negatively affected. Fortunately, the Judiciary Committee has released a set of principles to guide the discussion in the House, and they want to hear from you. Before the act is passed, we must contact our elected officials, including chairman Bob Goodlatte of the House Judiciary Committee, and insist on common sense simplifications such as a single rate per state, consistency of holidays and exemptions, a single audit covering all states, and reimbursement for integrating and maintaining a single national software platform. Ultimately, the Marketplace Fairness Act will impact all of us, either personally or through a friend or family member who relies on the ease of shopping by mail and the products and services that catalogs provide. I will continue to fight for what’s best for them and what makes sense for our economy. I guess that makes me a little “oldfashionedâ€? after all. â–
Web: Mayor’s efforts called into question continued from PAGE 10
Re: Cleveland mayor’s race ■What results has Mayor Frank Jackson seen from his efforts as a lifelong member of the community?
Can he honestly say the city of Cleveland is better off today than when he was a child? — Crystal Thomas
Re: Use of smart meters â– So, we would get to pay at least
$120 each to “help the utility remotely monitor, coordinate and operate portions of the electric grid?� Count me out. What’s next, setting my thermostat for me? No thanks, Big Brother. — Michael Sekerak
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Arteriocyte Inc. has won an $11.8 million federal contract that could grow to $101 million if the company hits all of its goals as it develops a new way to treat burns. Arteriocyte, which has offices in Cleveland and Hopkinton, Mass., will use the two-year base contract to continue developing what it calls the Magellan Bio-Bandage. The technology would use platelet-rich plasma, which is derived from blood, to help severe burns heal faster. The Bio-Bandage could be particularly useful if there is ever a domestic disaster that causes mass injuries, which is a big reason why the U.S. Department of Health and Human Services
ON THE WEB Story from: www.crainscleveland.com
awarded Arteriocyte the contract. If the company hits its milestones during the first two years, it could be awarded additional options to support more development for another three years. Thereafter, the Bio-Bandage should be ready to go: If the federal government exercises all its options, the award would fund lab testing, clinical trials, possible device modifications and the development of a process to build the final product. The company “will be positioned with capacity to immediately supply large numbers of Magellan units for rapid medical deployment in case of a mass casualty event,” according to a news release from the company. The technology is designed to be used by primary and secondary responders, according to a statement attributed to Arteriocyte CEO Don Brown.
“Hopefully, our country will never experience another mass casualty event, but we applaud the preparedness efforts and foresight that BARDA takes to plan for, protect against and respond to domestic disasters in the United States.” – Don Brown, CEO, Arteriocyte The U.S Department of Health and Human Services awarded the contract through the Biomedical Advanced Research and Development Authority, or BARDA, which is part of the Office of the Assistant Secretary for Preparedness and Response. “Hopefully, our country will never experience another mass casualty event, but we applaud the preparedness efforts and foresight that BARDA takes to plan for, protect against and respond to domestic disasters in the United States,” Mr. Brown said. ■
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INSIDE
19 THE PROS GIVE TIPS ON PLANNING A BIG EVENT.
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MEETINGS AND EVENTS Gay Games should be winner for Cleveland 2014 event could mean $50 million windfall for region By RACHEL ABBEY McCAFFERTY rmccafferty@crain.com
W
MARC GOLUB
The Great Lakes Truck Expo this year moved from the I-X Center to the Cleveland Convention Center.
IDEAL PLACE TO GATHER Organizers, visitors to the Cleveland Convention Center report that the city, new facility both put on a good show By LAURA STRAUB clbintern@crain.com
O
f the 1,700 attendees of the Content Marketing World 2013 event held in September at the Cleveland Convention Center, 75% had never been to Cleveland before, according to Joe Pulizzi, founder of the Content Marketing Institute. The city’s new convention center, which debuted this summer with the National Senior Games, has succeeded since its opening in bringing a slew of new visitors to the city as it works to attract a robust roster of meetings and events for the coming years. “I was thrilled by the number of people that got a good impression of Cleveland,” said Mr. Pulizzi, whose organization is based here. Lynde Vespoli of Discover My Cleveland, a destination management company, reported a similar experience with visitors during the National Senior Games. “I don’t know how many superlative adjectives you can use in a story,” said Ms. Vespoli, whose firm planned day trips for attendees to such landmarks as the
CONTRIBUTED PHOTO
Actor William Shatner was the closing keynote speaker for the 2013 Content Marketing World event in Cleveland. At left is Joe Pulizzi, founder of the Content Marketing Institute. Rock and Roll Hall of Fame and Museum, A Christmas Story House, Little Italy and PlayhouseSquare. “They had no idea Cleveland was like this.” For Positively Cleveland’s convention sales and services team, these good first impressions — as well as the city’s and facility’s other attributes — are critical as it works to
promote the city for future events. “First and foremost, the center is new, and anything new is appealing,” said Mike Burns, senior vice president of convention sales and services, who also pointed to the facility’s distance from the airport, public transportation and the city’s walkability. See GATHER Page 20
ON THE WEB: To view a photo gallery from the Great Lakes Truck Expo, log on to www.crainscleveland.com
hen the 2014 Gay Games start on Aug. 9, thousands of athletes, their families and friends will fill Cleveland and Akron’s hotels, spending their money at the cities’ restaurants and shops and comNobbe peting at sports facilities across the region. If the estimate from the games’ executive director is right, about 30,000 tourists will spend about $1,700 each during their weeklong stay — about $51 million total. But Tom Nobbe thinks the 2014 Gay Games will offer more than just economic benefits to the region. “The bid is a real opportunity for collaboration, for education,” said Mr. Nobbe, executive director of the Cleveland Special Events Corporation, which is organizing Gay Games 9. The Gay Games, held every four years since 1982, celebrate athleticism and inclusion. The 35-plus sporting events and opening ceremony are open to any person, ages 18 or older, regardless of sexual orientation or skill level. The games are a place where athletes can participate without the distraction of hiding their sexual orientation. “You can just be who you are and bring it all to the competition,” Mr. Nobbe said. The 2014 games will be from Aug. 9 to Aug. 16 and held in venues as varied as local colleges, the Cuyahoga Valley National Park, the Cleveland Metroparks Zoo and Dave & Busters. Mr. Nobbe said he is expecting 10,000 to 11,000 participants. And, with about 2,000 registrations projected by the end of September, those numbers are tracking as expected, he said.
Finding his passion Mr. Nobbe joined the games in July 2011 as executive director, about two years after the cities won the bid. The marketing and public relations professional had been working as vice president for corporate communications at University Hospitals and was looking for something he could be passionate about. See GAMES Page 16
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Staff recognition is rewarding for companies, too By KIMBERLY BONVISSUTO clbfreelancer@crain.com
B
Ten Things to do in Northeast Ohio
WHAT ARE YOU DOING THIS WEEKEND?
A weekly list of coming arts, culture and entertainment events that runs each Thursday on CrainsCleveland.com.
usinesses and organizations spend a collective $46 billion annually on employee recognition and rewards, according to the Illinois-based Incentive Marketing Association. And, many of those rewards and much of that recognition is presented publicly by employers at both formal and informal events. The payoff from these investments, according to the Incentive Marketing Association, is an engaged work force that positively impacts the company’s bottom line. Chris Fadden, spokesman for Clark-Reliance Corp. in Strongsville, said his company got into the employee recognition business about 10 years ago when there was a sudden realization that about one-third of its employees had more than 20 years of service with the company. Over time, the company added to its years-of-service milestone recognitions by rewarding employees who exemplify corporate excellence or who share money- or timesaving ideas. Rewards run the gamut from an annual dinner and ceremony to gift cards, cash, symbolic gifts and a mention on a company electronic bulletin board. “It’s not necessarily about the amount of the award. It’s really about the fact that you are recognizing people for their years of service and their ideas and input that goes above and beyond,” Mr. Fadden said. “It’s not just about going to work. It’s a good way of saying, ‘Put more of you into it rather than just treating it as a job.’ It’s a career. It’s something you want to help to see grow.” Mr. Fadden said the strategy is working. Clark-Reliance has tripled in size in the last 14 years. He said the reward system for ideas has now become part of company culture. It’s not unusual for staff members to be invited to pizza parties, fishing trips and the annual Cedar Point picnic as a show of gratitude.
CONTRIBUTED PHOTO
Last year, Dollar Bank recognized its staff with a Western theme at Executive Caterers at Landerhaven. right outside the entrance doors, whether spotlights and a red carpet or live horses ready to chomp at the apples offered by guests at last year’s Western theme.” The event involves thanks to employees for their years of service, a multi-course meal, dancing, souvenir photos and prize drawings. Dollar Bank president and CEO Bob Oeler said the bank’s employees “define this institution” and the annual party is a way to thank them for their commitment. Christine Krause, spokeswoman for Executive Caterers at Landerhaven, said the impact of the recession on businesses has been tremendous. And while over-the-top corporate parties are, for the most part, a thing of the past, businesses still feel compelled to have a tasteful, scaleddown event to recognize their employees or customers. The formality of the past, she said, has given way to events that “are truly more fun and filled with more energy.” “Corporate holiday events and recognition dinners have a way of improving company morale and improve communication between the individual and the company they work for,” Miss Krause said. “Acknowledging achievements in front of employee peers is one of the highest compliments a company can give. The applause alone speaks volumes.”
A round of applause
Making connections
Research from human resources firm Bersin & Associates found that companies with strong employee recognition programs are 12 times more likely to generate strong business results. It also found that employee engagement, productivity and customer service are 14% better than in companies that do not reward or recognize their employees. Dollar Bank of Cleveland, for one, holds an annual celebration in November or December that is a combination holiday party and service awards ceremony. Spokeswoman Lisa King said the event always carries a theme, such as The Wizard of Oz, The Lion King, ’70s and Dollar Bank Goes to Hollywood. This year’s theme: Winter Frost. “Guests walk into a different world the moment they step out of their cars at Landerhaven,” Ms. King said. “There is always something interesting awaiting them
Ernst & Young, an accounting firm, has held an EY Entrepreneur of the Year awards celebration at the local, national and global level for 28 years. The Northeast Ohio EOY is one of 25 such celebrations across the country. Whitt Butler, an advisory partner in the Akron office and Northeast Ohio Entrepreneur of the Year program director, said the event ties into the firm’s brand and purpose to “build a better working world.” “One of the ways we think we build a better working world is we put the spotlight on entrepreneurs and entrepreneurial companies,” Mr. Butler said. “It highlights them and connects them with service providers, advisers, investors and really helps their companies grow.” While there is no monetary award from the program, Mr. Butler said it does give the nominees strong brand recognition and introduces Ernst & Young to companies it would not have known otherwise. ■
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DOING THE HONORS Imagine an event during which you run through a warehouse full of merchandise — televisions, electronics, kitchen accessories, housewares — and have one minute to grab as much of it as you can and throw it into a laundry cart being pushed by a partner. Rock n’ Run the Warehouse, a program offered by Cleveland-based incentive and recognition company Partners for Incentives, is one example of different ways companies and organizations reward employees for meeting a sales goal or for showing outstanding performance on the job. Joy Smith, vice president of sales and marketing with Partners for Incentives, said employee recognition began with a lapel pin or a tie tack for years of service. Over time, the symbolic and emblematic gifts with the company logo evolved into lifestyle merchandise — think iPads and vacuum cleaners. “Companies are trying to engage people in the day-to-day activities that impact everything about the business every day, and they are rewarding based on that,” Ms. Smith said, adding that mid- and large-sized companies are the main players in implementing employee recognition programs. Electronics and housewares are among the hottest items sought by employees, while big ticket items like trips have fallen out of favor because
of personal tastes in locations and time constraints for booking tickets. Gino Zavarella, vice president of Gino’s Awards in Warrensville Heights, said gift cards were the rage for several years, but human resource professionals learned the cards either weren’t used or went toward buying necessities. The result was no public affirmation of exceptional behavior. Today, he is seeing a return to more traditional awards that can be hung on a wall or sit on a desk. “They show everyone else in the organization this is the gold standard for whether it’s effort, behavior, sales, whatever it is,” he said. Mr. Zavarella said the most important aspect of a rewards program is that the person handling the rewards takes it seriously. “If they take it seriously, then it’s received enthusiastically by the people who are eligible to receive the awards, and it becomes something important,” he said. Chris Fadden of Clark-Reliance Corp. in Strongsville added that money is the easiest reward to give, but it’s not necessarily the best option. “People are people, and there are so many different ways to motivate and each person has different motivation buttons,” he said. “The more you know your people, you know what buttons to push for the results you want.” — Kimberly Bonvissuto
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Games: Nobbe is ‘amazing’ continued from PAGE 13
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He has never participated in the Gay Games, but locally has a history of activism in the LGBT (lesbian, gay, bisexual and transgender) community. Mr. Nobbe helped start the AIDS Taskforce of Greater Cleveland and was involved with the Human Rights Campaign. That, plus his business background and his love of sports — he plays volleyball and tennis, and swims — made the games a good fit. Rob Smitherman, director of events and operations for Gay Games 9, has participated in the last four games and worked on the last two. Mr. Smitherman called Mr. Nobbe “an amazing leader” and said he has brought a business sense to the organization. He’s passionate and gets things done, he said. In two years, Mr. Nobbe has grown the board of directors from about seven to 22, hired a staff of eight and signed up venues, hotels and funders. He eventually plans to increase the staff to 15. Additionally, Mr. Nobbe has a goal of raising $2.4 million in corporate, individual and foundation funds, and the games are more than halfway there, he said. The Cleveland Foundation signing on in April as the games’ first-ever presenting sponsor was the tipping point. “That was huge for us,” he said. After the Cleveland Foundation gave its name and $250,000, businesses started calling and saying they were ready to sign on, Mr. Nobbe said. So far, more than 20 large corporations, nonprofits and civic sponsors such as Ernst & Young, Sherwin-Williams Co. and the Cleveland Clinic have committed to the games.
Sought-after demographic Mr. Nobbe said the Gay Games’ demographic is an appealing one to a variety of businesses. Participants and other attendees often are 35- to 55-year-olds with above-average incomes from major markets such as San Francisco and New York. Mr. Smitherman said he thinks participants may be inspired to come back for a vacation or a long weekend, like he did after participating in the Amsterdam games. People might even see the region as a viable, inexpensive place to move or start a business, he said. There’s also a less tangible benefit
in that a company or organization’s sponsorship shows employees that they value diversity, Mr. Nobbe said. That was certainly the appeal for the Cleveland Foundation. Bob Eckardt, executive vice president of the Cleveland Foundation, said that the economics of the games were impressive, but that they weren’t nearly as important as the opportunity to position Cleveland and Akron as more welcoming, inclusive and diverse cities. Michael D. Murphy, director of marketing and communications for the Cleveland Foundation, added that the Gay Games fit well with the foundation’s long-standing commitment to social justice and inclusion. Mr. Murphy was part of the original team that won the bid for the games, and he joined the foundation staff in August. While the pieces are coming together, challenges remain. Transportation will be a logistical hurdle to overcome. Mr. Nobbe has been talking with the Greater Cleveland Regional Transit Authority, Laketran and Akron Metro. And marketing the two cities will be critical. “We get asked a lot: Why Cleveland?” Mr. Nobbe said. For that question, he has plenty of answers: The cities’ desire for the games, the opportunity to hold the games in the country’s heartland, the affordability of the region and the local venues. But Cleveland and Akron aren’t typical tourist spots for the LGBT community, so the staff has their work cut out for them.
Creating a legacy There will be a chance to show off the cities at the beginning of October, when members of the Federation of Gay Games holds their annual general assembly and get the chance to visit a variety of Cleveland and Akron venues. Additionally, the staff has been working to create a legacy in Cleveland and Akron that lasts beyond the week-long event. It has been working with the Diversity Center of Northeast Ohio on LGBT competency training for corporations and with the Cleveland Foundation to form a legacy fund with a to-be-determined purpose after the games, Mr. Nobbe said. “The games are like a catalyst for so many things,” he said. ■
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Planning approach is critical to staging a successful event By JENNIFER KEIRN clbfreelancer@crain.com
to get people through the doors and coming back for more.
W
Think brand first
hen it comes to creating successful events, Stephanie Sheldon employs a straightforward
formula. “I do things that are interesting, I do them in an interesting way, so that people want to talk about them and be there,” she said. “That’s all that I do. That’s the only magic I have.” Ms. Sheldon is the brains behind the Cleveland Flea, a monthly flea market in Cleveland’s St. Clair neighborhood showcasing the work of local creatives, as well as a series of pop-up dinner parties she calls “Design Dinners.” Both have grown out of her desire to support local artists and help them connect to each other and to potential new fans. “When you look someone in the eye, you’re connecting with their brand and supporting them,” she said. “That’s why these in-person events are so important.” The fact that so many relationships are forged online today doesn’t pose a threat to the success of such events, said Ms. Sheldon and other event pros. On the contrary, people are seeking out meaningful events now more than ever. “Events will never go away, because people are social,” said Michele Clark, director of the Shlensky Institute for Event and Meeting Planning at Tri-C’s Corporate College. “People love to be intrigued by their senses.” That’s created a competitive landscape for events, said Ms. Clark, requiring creative thinking
Start with solid branding fundamentals, she said, creating a consistent identity for events that appeals to the senses, then repeat it over and over. To promote one event, for instance, Ms. Clark recruited volunteers to walk through every summer fair in Northeast Ohio wearing brightly colored T-shirts with a simple and compelling message about the event. To promote an event to 20-something music lovers, “go to the House of Blues and hand out something to people who are waiting to get in,” she said. “You have to be where your target audience is.” Ten years ago, University Circle Inc. launched a once-a-month free summer concert on Wade Oval. It was a great event, said UCI director of marketing Sheila Obrycki, but the once-a-month frequency required people to plan ahead to attend. Then the event went weekly and Wade Oval Wednesdays were born, an event that now draws 5,000 weekly. “It was a branding thing and we wanted to be consistent,” Ms. Obrycki said. “We want people to say, ‘Oh, it’s WOW night,’ and not even have to look at their calendars.”
Maintain authenticity “I don’t allow corporate sponsors. I don’t allow anyone to be at my events with information tables,” Ms. Sheldon said. “I don’t look at making money. I look at creating experiences.”
Having a big-name sponsor would be inconsistent with Ms. Sheldon’s indie brand, which requires authenticity to succeed. She believes money will follow authenticity; Cleveland Flea already is profitable just eight months in, while her dinners break even but are advancing toward profitability. While Ms. Sheldon doesn’t have sponsors, she does have partners, including independent photographers, event stylists and rental companies. “They’re people who themselves can bring in a ton of people,” she said. “Their acceptance requires them to market this event to those they know,” which includes posting once or twice to Facebook about her events. At 78th Street Studios in Cleveland’s Detroit Shoreway neighborhood, about 40 artists open their studios to the public monthly as part of the complex’s Third Fridays event. The public’s perception of a gallery opening can be stuffy and unwelcoming, said Third Fridays
SUZANNE PRICE/SUZURAN PHOTOGRAPHY
Stephanie Sheldon is the leader of Cleveland Flea and hosts a series of pop-up dinner parties, such as this one called “An Evening in Slovenia.” event manager Hilary Gent, who also runs HEDGE Gallery. But at Third Fridays, the public gets to interact with artists in their own workspace. “People come here because they want to experience art in a different way,” Ms. Gent said. “Making people feel like they created a connection with an artist, that’s so cool for people.”
Focus on ‘friend-raising’ For nonprofits that use events as fundraisers, the focus should be just as much on creating an experience people want to share with others as it is on money-raising goals, said Stacia Naoum, interim executive director of Merrick
House, a nonprofit community center in Tremont. “It’s not just about fundraising, it’s about friendraising,” Ms. Naoum said. “(The people who come and enjoy themselves) may become volunteers or bring more resources down the road.” Each Merrick House event has a different theme and appeals to a different audience — a fundraising concert at House of Blues that drew 400 people, a low-key fall party for 100 at Tremont’s South Side and the summertime “Tremont Moves” event with yoga and Zumba in the park. “Just like you diversify your funding, you diversify your events,” Ms. Naoum said. ■
Let’s work together to bring more
meetings to Cleveland.
W
ith $2 billion in visitor-related infrastructure
development, Cleveland is becoming a dynamic meeting destination. Joe Pulizzi, Founder of Content Marketing Institute, showcased Cleveland by bringing his company’s 2013 national meeting home. And, Positively Cleveland was
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18 CRAIN’S CLEVELAND BUSINESS
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Companies have increasing taste for healthy fare By CHRISSY KADLECK clbfreelancer@crain.com
B
urly truck drivers from Ross Cos. loaded up their lunch plates with sweet and baked potatoes, lowfat cheeses and low-fat sour cream during a recent all-day Saturday meeting at the Lorain County company. The self-serve potato bar was a hit among the typically meat-andpotatoes crowd and illustrative of the company’s healthy food policy, a commitment that it made in 2010 to only serve healthy fare for company-sponsored meetings, events, training sessions and award banquets. The food policy, which is shared with outside vendors and caterers, encourages menus rich in fruits and vegetables; whole grains versus refined grains; lean meats; low-fat cheese and dairy products; and limiting foods that are high in sodium and added sugars, said Shelli Fridenstine, human resources managers for Ross. That means turkey meatballs instead of regular meatballs at an awards banquet; whole wheat pastas, lots of salad and vegetable op-
FOOD FOR THOUGHT Kim Horvath, diabetes education and healthy lifestyle coordinator for EMH Healthcare, said companies and caterers looking to design nutrition-rich menus can make some simple changes without sacrificing flavor. ■ For dinners: Order chicken, fish or vegetarian entrees and stay away from beef or pork. Steer clear of gravy and sauces and mayo-based dressings and load up on salads, vegetables, brown rice and quinoa to have something different. ■ For snacks: Peanuts and almonds are a better choice than candy. Trail mix, boxes of raisins and even those chocolate-covered acai berries would be a real treat. ■ Stay away from cookies, pastries, donuts, croissants and muffins and those big bagels, because eating one of those is like eating five servings of bread. tions; and vegetable lasagna served alongside roast beef and mashed potatoes at the company Christmas party. “Our ownership and leaders are very wellness driven and have
brought that into the culture of the company,” Ms. Fridenstine said. “The ultimate health of our associates and their families is our goal here.” Ross clearly is a nutritional allstar, but a growing number of companies and organizations throughout Northeast Ohio are requesting healthier menu options at their meetings and special events, said Amy Jamieson-Petonic, registered dietitian with Cleveland Clinic Wellness Institute. “Everyone is looking to reduce fat, sugar and salt from their menus because what we know through the research is that these are the things that significantly impact health not only short term but in the long term,” Ms. Jamieson-Petonic said. “We know that high fat, high sugar, high salt increases our risks of cardiovascular disease, diabetes and osteoarthritis, and other inflammatory conditions.”
Cooking up healthy plans Ms. Jamieson-Petonic recently has joined forces with Jim Perko, the executive chef at the Clinic’s Wellness Institute, to develop several menu options for an out-of-
town convention center. They are developing menus for two breakfasts, two lunches and a break. “The most important thing I can share with you is these items taste great. People don’t care if it’s healthy; it’s got to taste good,” she said. “It’s a great opportunity to educate not only people who are attending these conventions but also the caterers on how they can offer healthier items.” For example, where you would normally have cheese Danishes, strudels and mega muffins at a breakfast, the Clinic team suggests creating an oatmeal bar with cinnamon, bananas, berries and raisins, unsweetened soy and almond milk. “A carrot zucchini chia seed muffin is an awesome opportunity to get some more fiber, to get some vitamins and minerals and omega 3 fatty acids from the chia seeds,” she said. “At a break, we would suggest doing a green smoothie and a sweet potato hummus and tortilla chips.” Joan Rosenthal, Marigold Catering in Cleveland, said the trend is definitely moving toward offering healthy food options but that doesn’t mean everything considered “unhealthy” is being axed from the buffet table. “It doesn’t mean that at a continental breakfast that you’re still not offering Danish and muffins, but that you’re also incorporating yogurt parfaits and fresh fruit options,” Ms. Rosenthal said. “For a lot of our corporate clients, we do a lot of build-your-own salad bar, baked potato bar, pasta bar because then that allows the person control over their diet and they can make it as healthy as they want.” Lunches are a perfect platform to inject some nutrition and creativity into a menu, and the meal for which Eric Petrus, executive chef with Lorain County Community College Dining Services, receives the most requests to add a healthy flair. “We create healthy alternatives that still have wow factor. We do food shooters with things such as watermelon gazpacho or we can make smoothies, such as a tradi-
tional strawberry banana to a cucumber lavender, and present it in a tiered, glass shelf,” Mr. Petrus said.
Recipe for success John Taylor, executive chef at Executive Caterers, said companies are moving toward greater variety, lighter foods and smaller portions because it keeps participants more alert during the business portion of the meetings and events. “With increased variety, you decrease portion size because you’re having more items. In years past, a menu may have consisted of a center-of-the-plate protein that was six or seven ounces, three ounces of vegetables and four ounces of starch with a heavy gravy, and they would serve that for lunch,” he said. “Now we’re doing a lot more smaller stations with smaller plates and incorporating more grains, salads, fruits, vegetables and smaller portions of protein and more vegetarian options.” Earlier this month he made a popular vegetarian entrée to serve at a luncheon featuring Cleveland Mayor Frank Jackson. “I take an acorn squash, hollow it out and roast it in the oven. Then I do a combination of tri-colored Israeli couscous, red quinoa, sundried tomatoes and lemon zest with extra virgin olive oil, which I stuff back into the squash and roast in the oven,” Mr. Taylor said. “That has just taken off here. People love it.” Healthy food can be accented very easily with fresh herbs, fresh juices, lemon and lime and different oils that don’t cost any more than butters and creams, Mr. Petrus said. Ross’ Ms. Fridenstine said she hasn’t seen a drastic increase in cost by implementing the company’s food policy. “Obviously it’s not as simple when we are doing a training meeting as calling up the pizza place and ordering up a whole bunch of pizzas, which would have been the old style,” she said. “You do have to take the time to think through what a healthier option would be.” ■
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CRAIN’S CLEVELAND BUSINESS 19
EVENT PLANNING: TIPS FROM THE PROS
P
lanning an event can be overwhelming for even the most seasoned event planning professional. So for someone new to the process, the experience can be downright frightful. To that end, we turned to five Northeast Ohio planning pros for some insight: “What is the best piece of practical advice you would give to someone planning a largescale event for the first time?”
Maria Haller Community engagement director Sherwin-Williams Company “There is so much that goes into the planning of a largescale event that no one person can successfully execute the long list of tasks and important details alone. It is critical to surround yourself with a highly effective and motivated core team. In 2012, Sherwin-Williams held our inaugural 5K run for charity. For everyone involved in the planning, it was our first time organizing an event of this type and magnitude. Nonetheless, we pulled off a really excellent race that was much larger than any of us had anticipated — more than 1,000 people attended and we managed to raise $65,000 that first year. Despite our lack of experience, the key to our success was each core team member’s individual knowledge and expertise, which, coupled with everyone’s hard work and commitment, created a remarkably successful event.”
Michelle Carver Senior manager, special events United Way of Greater Cleveland “Good relationships are key to successful events. Each event we plan connects us with vendors, donors and volunteers who add tremendous value to our events. Through the relationships we develop through the years, we have a wealth of expertise and resources for our event planning. Another very important factor to success is the passion the event planner brings to the job every day. Event planning is fun but at times stressful, especially when things don’t go as planned because of factors out of our control, like weather. Because I love my job, I plan for every possible scenario, and when havoc happens, I take a deep breath and deal with it. I consider it an honor to serve the Greater Cleveland community through my work at United Way. I care deeply for our mission, and, as I tell my 5-yearold, I get to help people every day.”
breaking it down into smaller milestones and delegating to a team is so helpful. At Rosetta, we use Microsoft Project to track all tasks, delegation and expenses — it really helps our team communicate and hold ourselves accountable. It only works, of course, if you communicate the plan to your team and send out regular updates. Plus, it’s a great way to celebrate small successes and track your progress along the way, which will further motivate you and your team.”
Meredith A. Scerba Senior vice president of event management Greater Cleveland Sports Commission “Planning a large-scale event takes a well thought out plan, a detailed task and timeline to support it, communication, strong leadership and staffing and delegation skills. A task and timeline provides you the opportunity to think through
and lay out all of the components of the event; you can then build upon these core areas with more details and finish it with dates for these tasks to be accomplished by. This gives your team a guideline to follow, holds them accountable and prevents the small things — yet often critical — from falling between the cracks. Communication and information sharing is a key factor not only internally but externally as well. Large events will typically involve an abundance of community entities and it is critical to keep all involved and informed throughout the planning process. These individuals will provide support and knowledge within their areas of expertise. A leader can only be as strong as the team they build around them. Identify the key roles you will need to execute the event. Create an organization chart and then surround yourself with strong individuals with the skill set you are looking for. Give them ownership of these areas as they will excel under this structure. With a strong team you will find that delegation will become easier. For most event planners, we tend to be control freaks and with a
large scale event this is impossible and will jeopardize the success of the event. Divide and conquer as a team and success will follow!”
Gregg Mervis President and CEO Akron/Summit Convention & Visitors Bureau/John S. Knight Center “Particularly if your event spans several days, its overall success and effectiveness must rest upon clear and achievable goals. This is especially true as your guests weigh the cost of attending the meeting, conference or exposition against their investments of time and money. Events — much like advertising, staffing and capital improvements— must yield measurable ROI (return on investment) as businesses determine where to spend their resources. Attendees will expect to acquire content and strategies from ‘investing’ in your event. Delivering on your agenda is vital.” — Laura Straub
Julie Fratus Senior recruiter, talent acquisition Rosetta “I know it sounds crazy, but always create a project plan when you are planning a large-scale event. Large events can seem overwhelming if you try to tackle it all at once, but
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20 CRAIN’S CLEVELAND BUSINESS
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Gather: Layout is ‘smart’ continued from PAGE 13
Not to mention, there’s a lot to do during downtime. “If we can bring a meeting planner and actually get them on the ground here, they’re impressed,” said Dave Johnson, director of public relations and marketing for the Cleveland Convention Center.
A few hiccups For Mr. Pulizzi, moving CM World to Cleveland from Columbus was a risk, but it was one he was willing to take because of his fierce dedication to the city. He said holding the event in Cleveland was pricier than Columbus, but attendees appreciated the venue. “People from New York City, Los Angeles and Chicago were all telling us to keep the event in Cleveland,” he said. “That blew me away.” Without the Convention Center, however, the CM World event would not be in Cleveland, Mr. Pulizzi said. “Overall, I think the Convention Center did a good job, but they’re still working out a few bugs,” he said. “They have a few things that could have gone better and put some gray hairs on our event team.” His biggest concern with the Convention Center was the availability
of staff outside of traditional work hours. He thinks this should be a consideration in the search for the next Convention Center operator. “I’m looking for new management that understands, it’s not normal business hours,” he said. During the National Senior Games, phone service was a main concern, but staff worked quickly with Senior Games CEO Marc T. Riker to provide additional phone lines and banks. “Their team worked on some solutions and got us through it,” said Mr. Riker. Mr. Johnson said Convention Center staff is continuing to rectify the cell service issues. The Verizon portable service sites sufficed for the time being, but the facility will have permanent Verizon service installed by the end of the month. He is sure more providers will follow. Other issues may more depend on the type of event taking place. Overall, the commuter-fueled Great Lakes Truck Expo was a success, and show manager Beth Trnka was pleased with the change in venue from the I-X Center. However, parking problems were a hot topic among exhibitors. “The one thing I kept hearing about was everybody was talking
ANACLETO RAPPING
The National Senior Games was the first large event held at the Cleveland Convention Center. about parking,” said William Morgan, president at Collins Equipment, based in Cleveland. Ms. Trnka estimated attendance at 3,500, about three times more than past events. She recognized that the issues with parking may have deterred some attendees. Still, Ms. Trnka believes the downtown draw outweighs any parking woes and
plans to continue to have the event at the Convention Center. But, she may consider use of the Cleveland Municipal Lot and a shuttle service in the future.
Perfect layout The benefits of the facility all seemed to outweigh any cons for Mr. Pulizzi and Mr. Riker, as well. Both were impressed with the layout of the center. “In addition to being the new kid on the block, it’s a very smart and intelligent design,” Mr. Johnson said. The L-shaped building is constructed around a loading dock with a unique truck turnaround. The minimal columns and high ceiling s facilitate easy movement throughout the space. “People didn’t have concerns accesswise of getting through the facility,” said Mr. Riker of the Senior Games. “From the athlete village to volleyball, it was all navigation friendly.” The space was equally suited for its first corporate event with CM World. Mr. Pulizzi was particularly impressed by the show flow. Attendees came out of their breakout rooms at the end of a session and walked directly toward the exhibitor area. “That layout is perfect,” said Mr. Pulizzi, whose event was able to run 14 concurrent sessions. Additionally, the Cleveland Convention Center has some features that are unique from similar
venues in the region, the first and most obvious being that it is underground. The abundance of space outside above the Convention Center enabled Senior Games organizers to hold the flame ceremony outside, atop the venue. “It creates a lot of opportunity in using the two spaces,” Mr. Riker said. “I like that. I thought it was a pretty unique concept.”
‘Why aren’t their events in Cleveland?’ Mr. Johnson said the Convention Center is targeting national events as well as niche events in the health care marketplace, considering Cleveland’s powerhouse status in the industry. However, he thinks the space will attract local businesses, too. “This is going to be a natural draw to local community events,” he said. Mr. Pulizzi believes private firms headquartered in Cleveland should bear the responsibility of making the Convention Center a hub for more large-scale bookings. By having his own events there and suggesting the venue to his friends looking for event locations, he thinks it is possible to help gradually turn Cleveland into a convention destination. He looks to large companies with headquarters in Cleveland. “Why aren’t their events in Cleveland?” he asked. “There’s no reason they can’t be.” ■
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CRAIN’S CLEVELAND BUSINESS 21
CLEVELAND CONVENTION CENTER EVENTS
T
he Cleveland Convention Center is continuing to add events to its schedule each week. Below is a sampling of some recent additions, with an expected attendance of 500 or more, that are coming soon to the facility.
STARCITYGAMES.COM OPEN SERIES Oct. 5-6 Expected attendance: 600 Anticipated impact: Jared Sylva, organized play department manager for Star City Games, expects hundreds of “Magic: The Gathering” players to visit Cleveland, eat out, stay in hotels, frequent local shops and enjoy the city. Show description: “The StarCityGames.com Open Series is the largest independent “Magic: The Gathering” tournament series in the world,” said Mr. Sylva. “Magic: The Gathering” is a collectible card game introduced in 1993 by Wizards of the Coast, he said. Each event is open to all players and awards $20,000 and 16 qualifications for the invitational competition, which will further award $75,000 in prize money. Total prize money for 2013 comes in at over $1 million. Organizer comments: “We are excited to be working with such a new and state-of-the-art facility, and look forward to many more exciting shows in Cleveland,” said Mr. Sylva. Previous show locations: Columbus; Philadelphia; Dallas; Orlando; Seattle; Worcester Mass.; and Los Angeles
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NATIONAL ASSOCIATION OF HOUSING AND REDEVELOPMENT OFFICIALS
ASSOCIATION OF INDIAN PHYSICIANS OF NORTHERN OHIO
For more on upcoming events, the Convention Center and adjoining Global Center for Health Innovation got to www.Crains Cleveland.com/medmart.
Oct. 24-26 Expected attendance: 1,500 Anticipated impact: 4,392 hotel stays. “More than 1,000 housing professionals from across the country are expected to travel to Cleveland this October,” said Saul Ramirez Jr., NAHRO CEO. “The conference will bring increased economic opportunity for the Cleveland Convention Center, hotels and restaurants in the local downtown area and highlight the best Cleveland has to offer to our stateside and international delegates.” Show description: The NAHRO National Conference and Exhibition is designed to be an educational opportunity for housing and community development practitioners, said Emily Pasi, public affairs coordinator and assistant editor at NAHRO. Organizer comments: “Cleveland was an obvious choice to host this year’s NAHRO National Conference and Exhibition,” said Ms. Pasi. She said the city long has provided decent, safe and affordable housing and progressive community revitalization initiatives. Previous show locations: Nashville; St. Louis; Washington, D.C.; San Antonio
Nov. 2 Expected attendance: 500-plus Anticipated impact: Many guests are expected to use area hotels, businesses, parking and limousine services. Show description: The event will serve as a presentation venue for AIPNO’s medical research posters. There will be guest appearance from U.S. Sen. Sherrod Brown as well as a cultural dance performance. Organizer comments: The Convention Center serves as a perfect venue for the event thanks to the centrality of its location and its spacious area, which will serve to accommodate the research poster presentations. Members of the association also are excited to indulge their interests in the medical field by visiting the Global Center for Health Innovation.
RUTH RATNER MILLER AWARDS DOWNTOWN CLEVELAND ALLIANCE Oct. 11 Expected attendance: 500 Show description: The annual Ruth Ratner Miller awards luncheon is an annual ceremony honoring development in the downtown Cleveland area. “This year we have a lot of awards because there was a lot of great development this year,” said Anna Beyerle, communications specialist for the Downtown Cleveland Alliance. Among the honorees are Scott and Iris Wolstein, who are being recognized for their development of the East Bank of The Flats. Organizer comments: “A lot of people, even though they are involved with downtown development, they maybe haven’t seen it yet,” said Ms. Beyerle. “The Downtown Cleveland Alliance wants to give all of our guests the opportunity to see the great, state-ofthe-art space. Considering the Convention Center itself is one of the downtown developments from the past year, what better place is there to hold the event?” Previous show location: Sammy’s Metropolitan
BLACK PROFESSIONAL OF THE YEAR 2013 AWARDS DINNER
HARTLAND & CO. CLIENT CONFERENCE Oct. 8 Expected attendance: 500 Show description: The 2013 Hartland Client Conference will bring together leaders in private industry, health care and education to speak about the responses of their organizations to low interest rates and economic growth. The conference aims to benefit both institutional and private clients and to provide information relevant to investors. Organizer comments: “Being a Cleveland firm, we thought it would be really cool to have it at the Convention Center,” said Dave Fulton, president and COO at Hartland. He said Hartland has gotten a large response from people out of town who are excited to come and see the new facility and the city. Previous show location: Intercontinental Hotel
Oct. 19 Expected attendance: 1,000 Show description: “The Black Professionals Association Charitable Foundation annual scholarship and awards gala will bring together people from northern Ohio to celebrate excellence, professionalism and scholarship in Greater Cleveland’s black community,” said Marcella Brown, executive director. “The event will raise more than $200,000 to support the academic pursuits of local college students who have aspirations to enhance their lives and the quality of our community.” Organizer comments: “BPACF is honored to be one of the first minority organizations to host an event in the new Cleveland Convention Center,” said Ms. Brown. “We believe this facility will benefit our community economically, culturally and socially.” Previous show location: Renaissance Cleveland Hotel
OHIO COUNCIL OF TEACHERS OF MATHEMATICS ANNUAL CONFERENCE Nov. 5-7 Expected attendance: 1,000 Anticipated impact: 574 hotel stays Show description: The annual conference is a means for the group to gather and share information with all of its members, said Mark Jaffee, immediate past president and annual conference coordinator for the event.
The conference will include presentations of teaching methods, content areas and educator tools. Organizer comments: The OCTM Annual Conference rotates between six cities, said Mr. Jaffee. This year was Cleveland’s turn and with the Cleveland Convention Center being recently completed it was an easy choice for the event, he said. Previous show locations: Toledo, Akron, Columbus, Dayton, Cincinnati
HOWARD HANNA FALL CONVENTION Nov. 5-6 Expected attendance: 4,000 Anticipated impact: 465 hotel stays Show description: The Howard Hanna Fall Convention will bring agents, mangers and staff from the 147 Howard Hanna offices located in Pennsylvania, Michigan, New York, West Virginia and Ohio to Cleveland. Organizer comments: “I’m thrilled to be able to show off our great downtown area to everyone from Howard Hanna,” said Howard W. “Hoby” Hanna IV, president of Howard Hanna Midwest. “We are looking forward to flooding the city and Convention Center with Howard Hanna ‘green and gold.’ ” Previous show location: Pittsburgh — Laura Straub
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CRAIN’S CLEVELAND BUSINESS
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SEPTEMBER 30 - OCTOBER 6, 2013
Progressive’s new ad campaign is missing a famous face But Flo isn’t retiring; company is going beyond the apron By E.J. SCHULTZ Advertising Age
Progressive Corp., the auto insurer that for years has filled the airwaves with lighthearted ads featuring Flo the perky sales clerk, is getting serious in its newest ad campaign. In television and digital ads, Progressive will abandon its incessant discount messaging and adopt an understated approach aimed at
pushing what executives say are the company’s values of hard work, pride and dedication. Flo is noticeably absent in the campaign, which is called “The Thread,” but her white apron is not. The garment, which she has worn in 94 separate ads in the past six years, appears at the end of the campaign’s first TV ad, which includes footage of people strapping on aprons as they head to work in various industries.
it.” And, he added, “millennials and others are really looking at the company behind the advertising.” The goal of the new cam- Flo paign is for Progressive to introduce consumers to the “real company behind its popular, apron-clad icon,” the company said in a statement, rather than make a hard sell. Still, the marketer and lead ad agency Arnold World-
Flo is not retiring: She will continue as the centerpiece of Progressive’s “Superstore” campaign, which along with other comedic spots such as “Rate Suckers,” still will account for the majority of the marketer’s media buy, said chief marketing officer Jeff Charney. “Flo has made us a household name,” Mr. Charney said. But, he said, “if you look behind the veil of ‘Superstore,’ there’s a real company and there’s real people behind
LARGEST PENSION PLANS Rank
See PROGRESSIVE Page 23
INSIDE THE LIST
RANKED BY TOTAL U.S. PLAN SPONSOR RETIREMENT ASSETS(1) Sponsor name City
wide took pains to avoid the typical conventions used in corporate-image efforts. For instance, rather than spotlighting Progressive employees, the campaign will feature outsiders the company says shares its values. Initially, the campaign will take the form of an initiative called “Apron Projects,” which will be hosted on a dedicated website that will include videos of people “who, through their work, make progress by making things a little better,” according to the company.
Phone Website
Total U.S. plan sponsor retirement assets ($ in millions)
Total U.S. defined benefit assets ($ in millions)
Total U.S. defined contribution assets ($ in millions)
1
Ohio Public Employees Retirement System Columbus
(800) 222-7377 www.opers.org
79,615
78,968
647
2
State Teachers' Retirement System of Ohio Columbus
(614) 227-2815 www.strsoh.org
65,485
64,900
585
3
Ohio Police & Fire Pension Fund Columbus
(614) 228-2975 www.op-f.org
12,427
12,427
NA
4
School Employees Retirement System of Ohio Columbus
(614) 222-5900 www.ohsers.org
10,733
10,733
NA
5
FirstEnergy Corp. Akron
(800) 736-3402 www.firstenergycorp.com
8,974
6,337
2,637
6
Ohio Public Employees Deferred Compensation Program Columbus
(614) 466-7245 www.ohio457.org
8,937
NA
8,937
7
Nestle USA Inc. Solon
(440) 349-5757 www.nestle.com
6,921
3,703
3,218
8
Goodyear Tire & Rubber Co. Akron
(330) 796-2121 www.goodyear.com
5,934
3,827
2,107
9
Parker-Hannifin Corp. Cleveland
(216) 896-3000 www.parker.com
5,419
2,180
3,239
10
Eaton Corp. Cleveland
(440) 523-5000 www.eaton.com
4,904
1,960
2,944
11
Sherwin-Williams Co. Cleveland
(216) 566-2000 www.sherwin.com
4,013
668
3,345
12
Timken Co. Canton
(330) 438-3000 www.timken.com
3,870
2,688
1,182
With plan assets of $79.6 billion and $65.5 billion, respectively, the Ohio Public Employees Retirement System and the State Teachers’ Retirement System of Ohio are the unchallenged leaders among pension plans in the state. But neither is particularly close to the top 10 plans nationwide, according to research compiled by Pensions & Investments, a sister publication of Crain’s Cleveland Business. Ohio PERS is the 15th-largest pension fund in the country, based on plan assets as of Sept. 30, 2012. It’s only about one-quarter the size of the country’s largest pension fund, the Federal Retirement Thrift Investment Board, which on this date exactly a year ago reported total assets of $325.7 billion. (The board’s Thrift Savings Plan is a defined contribution plan for U.S. civil service employees and retirees, as well as for members of the uniformed services. It has about 4.6 million participants.) There are eight U.S. pension plans with total assets exceeding $100 billion, Pensions & Investments research shows. In addition to the Federal Retirement Thrift Investment Board, they are:
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13
Carpenters, Pension Fund, Ohio Cleveland
14
KeyCorp Cleveland
15
(216) 361-6190 www.ohiocarpservoff.org
2,554
2,363
191
(216) 689-3000 www.key.com
2,436
941
1,495
Progressive Casualty Insurance Co. Mayfield Village
(440) 461-5000 www.progressive.com
1,980
NA
1,980
16
Engineers, Operating, Local #18 Cleveland
(216) 432-3138 www.iuoelocal18.org
1,812
1,812
NA
17
Laborers, District Council, Ohio Westerville
(614) 898-9006 www.olfbp.com
1,673
1,673
NA
18
Fifth Third Bancorp Cincinnati
(513) 579-5300 www.fifththird.com
1,500
197
1,303
19
Jones Day Cleveland
(216) 586-3939 www.jonesday.com
1,342
369
973
20
Lubrizol Corp. Wickliffe
(440) 943-4200 www.lubrizol.com
1,335
449
886
21
Electrolux Cleveland
(216) 898-1800 www.electrolux.com
1,279
1,042
237
22
Lincoln Electric Holdings Inc. Cleveland
(216) 481-8100 www.lincolnelectric.com
1,117
800
317
23
Diebold Inc. North Canton
(330) 490-4000 www.diebold.com
1,050
532
518
24
Cliffs Natural Resources Inc. Cleveland
(216) 694-5700 www.cleveland-cliffs.com
1,035
846
189
25
American Greetings Corp. Cleveland
(216) 252-7300 www.americangreetings.com
858
86
772
Source: Pensions & Investments. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. (1) Numbers as of Sept. 30, 2012.
RESEARCHED BY Deborah W. Hillyer
■ California Public Employees Retirement System, $244.7 billion ■ California State Teachers Retirement System, $155.7 billion ■ New York State Common Retirement Fund, $150.1 billion ■ State Board of Administration of Florida, $134.3 billion ■ New York City Retirement Systems, $132.1 billion ■ General Motors Co., $117.8 billion ■ Teacher Retirement System of Texas, $112.4 billion Rounding out the top 10 are two corporate plans below the $100 billion asset mark: International Business Machines Corp. ($93.9 billion) and Boeing Co. ($91.4 billion). Nationwide, Ohio PERS ranks just below the pension plan of AT&T Inc. ($81 billion) and just above the New Jersey Division of Investment ($74.8 billion). The State Teachers Retirement System of Ohio is the 19th-largest pension plan in the country. There are six corporate plans among the top 25 plans nationwide: GM, IBM, Boeing, AT&T, General Electric Co. ($67.1 billion) and Lockheed Martin Corp. ($53.7 billion). — Scott Suttell
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Construction: ‘There’s a lot of action in Northeast Ohio right now’ continued from PAGE 3
Mr. Jones said another sector seeing big increases in construction is the health care field. Turner just wrapped up projects for the Cleveland Clinic at Fairview Hospital and the surgery center at Marymount, Mr. Jones said. In the health care sector, though, Mr. Jones isn’t certain the spending increase will last, as he believes implementation of the Affordable Care Act could make hospitals wary of investing in construction. Mr. Laird of Gilbane also said he sees the potential for a slowdown in the health care sector, though he and many others are optimistic about the industry overall. Corporate building in Cleveland has been on the rise with projects such as Eaton Corp.’s new North American headquarters in Beachwood and the new Ernst & Young building in the Flats, Mr. Laird said. New projects also are on the brink of coming to fruition. “I am looking forward to see what developers have in mind for the waterfront,� said Robert Weeks, senior director of business development of Cleveland Construction Inc., which is based in Mentor. Last month, five groups of developers responded to a call from the city of Cleveland, which issued a request for qualifications to develop one or both of two parcels totaling 28 acres along the waterfront. In addition to the waterfront plans, projects on the horizon include a downtown convention center hotel, a second phase of the Horseshoe Cleveland Casino and possible residential renovations at the May Co. building on Cleveland’s Public Square. “That will lead you to conclude that I am an optimist,� Mr. Weeks
said. Mr. Laird said the growing list of pending projects is affirmation that the economic recovery is taking hold. “The demand is just so pent up after the length of the recession,� he said.
Preparing for more To gear up for the increase in business, crane rental company All Erection & Crane Rental Corp. is stocking and updating its inventory of construction cranes for lease. Over the course of the summer, All purchased 48 Manitowoc and Grove cranes and other ancillary equipment, some of which is slated for use near the company’s Cleveland headquarters. “There’s a lot of action in Northeast Ohio right now,� said Peter Zeller, a spokesman for All. The action mainly comes in the form of road and bridge work, vertical construction and power generation facilities statewide. “We’re growing,� Mr. Zeller said of All. “We’re preparing ourselves for more growth.� Although All is the largest crane rental company in North America, smaller rental agencies are bulking up as well. Alan Zatik, president of ABC Equipment Rentals, said the Brunswick company saw a strong increase in business last year that has continued this year on a smaller scale. He said rentals are up 7% to 8% across the board. “Things were down so far, they’re starting to come back to normal,� Mr. Zatik said, citing activity from the convention center and Inner Belt bridge construction. “A lot of things came together in Cleveland in the past two years,� he said.
Good sign: Cranes in the air At Gilbane, Mr. Laird said he’s hiring aggressively. He said there is an increasing need for skilled construction workers, many of whom left the industry during the economic downturn. A key question remains: Will there be adequate numbers to support the new boom? Mr. Laird is still waiting to find out. “We are aggressively hiring in anticipation,â€? he said, though he would not put specific numbers to the additions. With the expectation of an upturn, Gilbane took time “to reinvent our business model a littleâ€? during the downturn, Mr. Laird said. That strategy paid off now that market conditions are better; he said management is leaner and more efficient, and Gilbane has gone international through acquisition. Even with the current influx of construction projects, though, some officials, mindful of the depth of the recession, remain skeptical about the market going forward. Mr. Jones of Turner Construction, for one, expects the second half of 2013 to be more vibrant than the first half, though he isn’t entirely sold on the idea of a continuing upturn yet. “I’m not as optimistic this may be an upward trend,â€? he said. “It might just be a bubble.â€? Indeed, looking ahead, Mr. Jones said he does not see the same volume of projects scheduled for 2014 as he did for the second half of 2013. However, Mr. Zeller of All said construction companies for now are enjoying relatively good times. “When you see cranes on the horizon, it is a sure sign someone is growing,â€? he said. “And there are a lot of cranes on the horizon.â€? â–
DAN SHINGLER
The new Ernst & Young Tower is one of many local projects that has helped spur recent growth in Northeast Ohio’s construction industry.
Progressive: Sentimental ads still big part of business
VALUE ADDED INVESTMENT OPPORTUNITY
continued from PAGE 22
THE CLEVELAND TWIST DRILL BUILDING
One video features Stephen Ritz, a high school principal in New York’s South Bronx and founder of the Green Bronx Machine, which teaches kids about urban gardening. Another video spotlights a San Francisco startup called Helios Bars, which invented special blinkers and GPS systems designed for bike handlebars meant to improve safety. Progressive is not financing these startups or giving money to the people featured in the videos. And the company isn’t asking for a direct response from viewers. Rather, Progressive simply wants to help these people “tell their story,� Mr. Charney said, noting the subjects of the videos will be featured across Progressive’s media properties, including its Facebook page. “We are just saying, ‘Look, we respect people like us,’ � he said. “Progress is what we are all about.�
The return of touchy-feely The approach is another example of the car insurance industry returning to its roots of emotionally tinged, serious advertising after years of spending hundreds of millions of dollars on flashy campaigns featuring quirky mascots and punchlines. Those strategies remain in full force, whether it be with Flo, Allstate’s “Mayhem� or Geico’s
gecko. But marketers are complementing these campaigns with softer ads in an attempt to stand out in a category that spent a collective $2 billion on measured media in 2012, according to Kantar Media. Allstate, for instance, recently added a touchy-feely campaign called “Good Life� to its media mix, with a simple message that “people live for good.� Nationwide Insurance last year ditched its geeky “World’s Greatest Spokesperson in the World� character for emotional ads featuring voice-overs by Julia Roberts in an effort called “Join the Nation.� Progressive opted against a celebrity spokesperson for the first TV ad of its new campaign, which launches during programming including NBC’s “The Voice� and CBS’ “Big Bang Theory.� Rather, the man speaking in the ad is Sean McBride, senior vice president-creative director at Arnold Worldwide, who wrote the ad. Mr. Charney said using celebrities “would be pretty typical of everybody else in the world.� Referring to Mr. McBride, he said: “He believed it. He was the first guy who read it to me. And it stuck with me.� ■E.J. Schultz is a reporter with Advertising Age, a sister publication of Crain’s Cleveland Business.
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Rental: Nearly 1,500 units are being built in Cuyahoga County continued from PAGE 1
When the general manager at Rick Case Hyundai phoned apartment buildings downtown, he was surprised to find so many filled. He counts himself lucky to land at the Hanna. Last week, just one suite was available out of the 102 units developer K&D Group is finishing up in the former Hanna Annex office building. The hunger for rental properties, particularly downtown, has yet to be sated. It remains to be seen, though, whether efforts by developers to capitalize on the apartment frenzy with projects from Beachwood to Rocky River eventually will create an oversaturated market in Greater Cleveland.
D SAVE THE
For now, it appears the market can handle a lot more apartments. And developers seem only too happy to oblige, especially with projects in the city. According to data from the Marcus & Millichap real estate brokerage and Dallas-based apartment consultancy Axiometrics Inc. as well as information gathered by Crain’s, 718 apartment units have opened this year in the city of Cleveland. In addition, another 1,466 units that will open next year at the earliest are under construction in Cuyahoga County. Of the units under development, 722 are in downtown Cleveland and the city’s neighborhoods, and 744 are in two projects in Beach-
wood and one in Rocky River. The numbers are upbeat, especially after the development doldrums of the recession, though the pace of apartment creation in this area lags other markets. Russ Coulter, a spokesman for Axiometrics, said the firm estimates that for Cleveland to build on a par with other, busier apartment markets, developers in Cuyahoga County would need to add 3,800 more units next year than currently are planned. Consider how many units are going into other apartment markets this year, according to Axiometrics data: Raleigh, N.C., 3,782 units; Seattle, 6,497 units; and more than 9,000 units in Dallas, Houston, and
Washington, D.C. Ryan Szymanski, vice president of development at Edwards Cos. of Columbus, sees the contrast in markets firsthand. Mr. Szymanski is shepherding construction of Edwards’ four-story apartment building in Rocky River that’s rising on the site of a demolished shopping center. Workers are starting to install an underground parking garage for the project. Edwards will not start taking reservations for the 264 units it’s creating until the end of the year, but Mr. Szymanski already feels encouraged, saying, “There’s been a lot of interest in the place.” By contrast, Edwards is building apartment projects in two locations
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in Columbus, where The Columbus Dispatch estimates 10,000 suites are under construction this year and worry among city planners about the supply of apartment is common. Edwards sees its target market here as empty nesters and young professionals, while in Columbus, which has population growth, the focus is young professionals. “Our belief is that in any market there is demand for A-class project,” Mr. Szymanski said.
Breather needed? On the opposite side of town, the foundation is in at a 348-unit apartment building at Green Road and Chagrin Boulevard in Beachwood that NRP Group and Munsell Realty Advisors are developing. A few miles away, near Beachwood Place Mall, 143 units are underway in a five-story structure in a suburb where the last new apartment building opened 15 years ago. Jordan Goldberg, senior vice president at developer Goldberg Cos., said his company believes there is demand for its new building and that of its competitor. He also isn’t concerned about a potential oversupply situation here based on the current pace of construction. “It’s a raindrop falling in a lake,” Mr. Goldberg said, adding, “We also don’t see people buying homes as readily now as they did in the past.” Doug Price, CEO of prolific apartment developer K&D Group, is a bit more guarded than Mr. Goldberg in assessing the market longer term. K&D has been downtown Cleveland’s most aggressive apartment developer the last few years, and continues to add to its holdings. Construction workers this month are putting the finishing touches on K&D’s Residences at the Hanna, soon will finish converting the former Embassy Suites hotel back to apartments, and just closed on financing to buy and change to apartments an office building at 1717 East Ninth St. that once housed the old East Ohio Gas Co.’s headquarters. Even with almost-full new buildings and waiting lists at its other properties, Mr. Price said he expects to see a softer market for top-tier suburban apartments in the future. He cites two reasons: People are buying homes at a stronger pace than during the housing downturn, and they are willing to move more as the economy recovers. “It may be time to take a breather and size things up,” said Mr. Price, whose company also has substantial apartment holdings in the eastern suburbs.
The more, the merrier Others differ and believe the incredibly high downtown and regional apartment occupancy rate — which both sit above 95% — will not fall for some time. Ari Maron, a partner in the familyowned development firm MRN Ltd., said he has been fending off questions about supply as the company has planned each of its projects, whether it was converting old buildings to lofts in what’s now the East 4th Street Neighborhood or building new apartments at Uptown in University Circle. “With every building we’ve done, we’ve done better,” Mr. Maron said. “We’re seeing growth in walkable, transit-oriented developments. The growth is where people can walk to work or take public transportation. Millennials are more likely to rent than others.” continued on PAGE 25
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“While you are on top, you have to do as much as possible. (Apartment owners) are taking advantage of the environment we’re in now because the market never has been hotter.”
continued from PAGE 24
Mr. Maron cites as an example the response to MRN’s latest completed work, the Lofts at Rosetta, 610 Euclid Ave. All 97 suites were rented in September, the month it opened. The numbers are on the side of adding more units downtown and nearby, Mr. Maron said. In a region of 2.1 million people, a central business district should be at a minimum 1% of that figure, or 21,000 residents. If downtown residency is about 14,000 at present, he said, there is substantial room to grow. While various building conversion projects are in progress or in the offing, the only ground-up apartment building planned for downtown is the 250 units in the second phase of the Flats East Bank Neighborhood, the redevelopment of the Old River Road section of the Flats by Wolstein Group and Fairmount Properties. Like Mr. Maron, Scott Wolstein, a principal in Wolstein Group with his mother, Iris Wolstein, brushes aside worry about supply outstripping demand. “I think the downtown residential rental market is severely undersupplied for a metropolitan area of this size,” Mr. Wolstein said. He said he supports the target of a downtown population of 25,000 that the city of Cleveland long has pursued in order to create a vibrant downtown — especially to support retail, the last missing piece in the city’s makeover. However, it’s a chicken-and-egg situation in terms of apartment development, with rental rates still not high enough for most developers to jump into the downtown market and build brand-new projects, according to Mr. Wolstein. “I do not expect to see rental rates rise significantly until the quality of housing warrants a higher rental structure,” Mr. Wolstein said. “The quality of the current housing stock does not.” When apartment rents climb, there will be enough development to create a critical mass of downtown residents, he said. To achieve rents to spur construction of apartments, it will take a special project, Mr. Price said, such as Flats East Bank’s riverview buildings. They will attract the consumers, he said, who can afford to pay more for what they want.
25
– Ralph McGreevy, executive vice president, Northeast Ohio Apartment Association
STAN BULLARD
The Chester Commons Building, located at 1120 Chester Ave., has been rechristened as Seasons at Perk Park and is renting apartments.
Strike while the iron is hot While recent apartment developments have created a livelier downtown from Cleveland State University to the Flats, the development impulse also is spreading across the Cuyahoga River to Ohio City, where developers are planning the first rental projects in the neighborhood in more than a decade. Construction crews recently set to work building the 62-unit Mariner’s Watch apartments at 3902 Detroit Ave. Also, the recently announced and already under-construction Shoreway Building Apartments on West 73rd Street will add high-end apartments in a loft rehab overlooking Edgewater Park. Eric Wobser, executive director of the Ohio City Inc. neighborhood development group, talks now about preserving the Ohio City historic district for single-family homes and using the main arteries such as Detroit as locations for apartments. Other developers privately weigh the possibility that the stretch of Detroit from downtown to Edgewater Park might become home to multiple rental properties. Rick Foran, a co-developer of West 25th Street Lofts, a proposed, 72-unit conversion of a former brewery and other buildings that is seeking financing in Ohio City, said he believes the “revival of urban living is not just
a bubble. It’s a movement.” Damon Taseff, a corporate real estate expert who is planning a 21suite apartment project inside the former West Side Community House at 3000 Bridge Ave., said he always is amazed by how many people he finds on a social basis
who are looking for rentals in Ohio City or downtown. “I think there are a lot of people in the suburbs who will want to live in the city. There are people living in the basements of their parents’ houses because they can’t find an apartment where they want to be,
or are sitting in a Class B apartment until they find one,” Mr. Taseff said. “I know that I can fill 21 suites in Ohio City.” With the Northeast Ohio Apartment Association reporting regional vacancy at 4% last June and Downtown Cleveland Alliance putting downtown apartment vacancy at 3%, now is the time for developers and civic interests to seize a historic opportunity in a city that has lost population for 20 years, said Ralph McGreevy, executive vice president of the apartment association. “It will take a lot of development to eat away at those occupancy figures,” Mr. McGreevy said. “While you are on top, you have to do as much as possible. (Apartment owners) are taking advantage of the environment we’re in now because the market never has been hotter.” ■
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Issues: Majority of county, city and school board issues are increases continued from PAGE 1
one of the county health and human services issues instead of waiting until 2014 means voters will be asked to approve three countywide money issues this election cycle. The Greater Cleveland Partnership, the region’s chamber of commerce, is supporting all three Cuyahoga County issues, but it is raising the issue of creating a levy schedule so that voter fatigue can be avoided and fundraising can be better coordinated. “We need as a community to create a well-established schedule of levies that are naturally expiring and levies that could be under consideration,” said Joe Roman, GCP’s chief executive. “We need to create and publish for all parties concerned what those schedules look like.” GCP earlier this year created a single campaign committee, Businesses for Cleveland’s Future, to raise money to support issue campaigns. The committee is putting its money, about $700,000, behind issues that support parks, the port and the Cleveland Public Library.
‘I’m never comfortable’ School boards, cities, counties and independent agencies are seeking increases because revenue is falling for two reasons — declines in home values that lower property tax collections and cuts in state and federal support for local services. Countywide issues traditionally have won voter approval. However, campaign strategists are never com-
“In Northeast Ohio, we’ve got (new or increased tax) issues all over the place.” – Bill Burges, campaign consultant placent, and the crowed ballot this year only has heightened concern. Of the 25 county, city and school board money issues on Cuyahoga County ballots, 14 issues are increases. “In Northeast Ohio we’ve got (new or increased tax) issues all over the place and voters are extremely selective, and I think you have to respect that,” said campaign consultant Bill Burges. “I’m never comfortable about anything.” Mr. Burges’ Euclid firm, Burges and Burges Strategists, manages candidate and issue campaigns across the state, including this year’s Cleveland Metroparks issue, which is Issue 80 on the ballot. Jeff Rusnak, CEO of the R Strategy Group, said he believes the countywide money issues are often tougher to sell to voters than candidates. “Everyone is competing for the same money” from voters, he said. “It’s especially difficult when it’s a crowded ballot.” R Strategy is working for Issue 82, the port levy.
Forcing their hand The campaigns got tougher for Mr. Burges and Mr. Rusnak when
Cuyahoga County Council decided near the filing deadline in August to put the health and human services issue on the Nov. 5 ballot rather than wait for its traditional “turn” next year. Cuyahoga County currently is subsidizing the MetroHealth System and its services for children and the elderly through two levies. A five-year, 4.8-mill levy that generated $139.7 million was passed in 2012; in 2010, Cuyahoga County voters approved a 2.9-mill renewal levy that produced $79 million annually. The next levy was not expected until 2014. But a revenue shortfall caused by state and federal cuts pushed County Council to move up the calendar — and increase the size of the human services levy. “The challenge this time is that (Cuyahoga County health and human services agencies) are facing $15 million of federal and state cuts that are now in place and that’s why they levy is on this year and not next,” said Alan Melamed, whose Beachwood firm, Melamed Communications, is mapping campaign strategy for Issue 1, the Cuyahoga County health and human services levy. Issue 1 asks voters to approve a 2.9-mill replacement and a 1-mill increase in the human services levy. That combination will increase the cost for the owner of a $200,000 home to $272 a year from $180 a year. The Metroparks board is seeking
renewal of a 10-year, 1.8-mill levy and an increase of 0.9 mills. The existing levy is costing the $200,000 homeowner $128 a year. The new levy will bump that total to $184. Although he would never concede it, Mr. Burges’ campaign for the Cleveland Metroparks probably is an easier sell than the human services levy. The park system levy should receive a boost from the rave reviews Metroparks has won from users of the five former state lakefront parks and a marina that were added to the Metroparks system in May.
for five years. It failed by a wide margin, forcing the port authority to lower its ambitions for its share of the lakefront. So instead of emphasizing a future role as a lakefront developer, the campaign for Issue 82 is emphasizing the jobs and business generated by the import and export businesses that use the port. “This campaign will get back to the core” mission of the port authority, said Mr. Rusnak, who called the port “the sole governmentfunded economic development and job creator” on the ballot.
Back to basics
Timing is everything
The third county levy, for the port, is a renewal of a 0.13 mill levy that provides $3.1 million to subsidize the operation of the Port of Cleveland, the lakefront center for imports and exports. It’s the smallest levy on the county ballot and costs the owner of a $200,000 home only $6.96 a year But the port and its management have faced choppy waters in recent years. The port authority over nearly a decade struggled unsuccessfully to create and implement an ambitious plan to move its docks and remake the downtown lakefront. Then, when it proposed an alternate lakefront development plan that would have included a pedestrian bridge to link downtown to the lakefront museums, it asked voters last November to approve a 0.67-mill levy that would have raised $18 million a year
The local business community, through Greater Cleveland Partnership, is supporting all three countywide issues, as well as the Cleveland Public Library issue. But its financial support is not evenly divided. Mr. Roman said when his group earlier this year created the Businesses for Cleveland’s Future committee, it expected to divide the money it raised roughly equally among the campaigns for the Metroparks, port and Cleveland library system. But then County Council decided late in the game to put the human services levy on the ballot. GCP is endorsing that levy, but has pledged only $15,000 to its campaign. “It wasn’t part of the process that we agreed to in June,” Mr. Roman said. “It didn’t come onto the scene until early August. It just came in too late.” ■
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THEINSIDER
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REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS
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Matches made in medical heaven
The big story:
■ The Cleveland Clinic’s Medical Innovation Summit always brings some of the biggest names in medicine and business to the region. And with this year’s event, the Clinic is making it easier to rub elbows with some of those movers and shakers. The Clinic has introduced MIS Match, which it describes as a networking platform that allows attendees to schedule one-on-one meetings with other attendees from organizations they’d like to get to know. Awkwardly wandering the halls and hoping for some face time is no longer required. Those who are registered to attend the summit can browse a list of other attendees online and request appointments with those people. A quick search of this year’s attendees revealed high-profile guests from Boston Scientific, Johns Hopkins, Pfizer, General Electric and others. (Crain’s will be there, too.) The networking software is powered by EventRebels, a Maryland-based firm that provides online services for trade shows. This year’s Innovation Summit will be held Oct. 14-16 at the Global Center for Health Innovation, the building formerly known as the medical mart in downtown Cleveland. This year’s theme is “Finding Balance through Innovation: Obesity, Diabetes & the Metabolic Crisis.” — Timothy Magaw
Associated Estates Realty Corp. agreed to buy seven apartment complexes in the South for a total of about $324 million. The 1,606-unit portfolio includes 795 units under construction by the current owner that will be sold to Associated Estates once completed. The portfolio consists of apartments in the RaleighDurham and Charlotte markets in North Carolina, as well as the Atlanta and Tampa markets. The portfolio has an average year built of 2012.
Shopping trip: The troubled Southgate Shopping Center in Maple Heights landed a prospective buyer, America’s Realty LLC of Pikesville, Md., which expects to land leases to give the property a new life. America’s Realty expects to buy the 795,000-square-foot retail center for about $14 million. President and CEO Carl Verstandig said America’s Realty already has a tenant ready to take 70,000 square feet at Southgate in a former department store space: Roses Stores, a deep discounter from North Carolina. Market forces: The elimination of mortgage jobs amid increased interest rates continues, as JPMorgan Chase & Co. disclosed that it will close the Chase Home Ownership Center on West Third Street in Cleveland and cut 31 employees. In a Sept. 23 letter, the company revealed to the state Office of Workforce Development that it “is taking a number of steps to align our mortgage business support activities to the current market environment, including evaluation of our footprint in various locations.” Plenty of space available:
University Square, the multi-level shopping center in University Heights dogged by vacancy, is going on the Internet auction block. With occupancy of just 24% in the almost 290,000-square-foot multitenant portion of the retail property, the complex is the subject of an Auction.com online auction that begins Oct. 8. Prospective bidders must show they are serious by making a $50,000 deposit. The sale does not include the attached Target or Macy’s stores, which the retailers themselves own.
■ News flash: Donuts and ice cream go really well together.
Cleveland-area food entrepreneurs gave firm’s president. away spicy pickles, marshmallows made So, the Cleveland-based law firm built its with beer and pepper-flavored popsicles last own distribution channel. week during the grand opening of Cleveland Launched this summer after two years of Culinary Launch & Kitchen, 2800 Euclid Ave. development, the so-called Business Advocate Nineteen companies that rent kitchen is an online community linked to McDonald time at the food incubator set up booths at Hopkins’ website where lawyers are blogging the grand opening, about topics ranging many of them giving from employees’ Faceout free samples. book use to hacking. After trying nearly They’re posting polls all of them, I give my and videos, too. “Best in Show” award Similar to other social to Mason’s Creamery, media, users of the which gave away what online community can I can only describe as like and comment on ice cream sandwiches posts and contribute that used little donuts their own. But these instead of bread. conversations are all Second place goes to business. Frank Serrow of Frank’s Hickory Syrup. East Slider/West Slider, “Websites are really a company that plans to launch a food truck. one-dimensional, and client alerts are really They made good sliders, but I liked their one-dimensional,” Mr. Grassi said, referring smoked macaroni and cheese even more. to emails that his firm sends to clients. “This Full disclosure: My wife is a second community is all about us being able, in a cousin of Tim Skaryd, one of the incubator’s virtual format, to exchange ideas.” co-founders. In other words, I know people The online community is open to clients, in the food business, so my opinion should referral sources and others. Eventually there matter. — Chuck Soder will be private, client-only parts of the community, Mr. Grassi said. To contribute and comment, one must be a subscriber, of which there are 50 to 100, he estimated. McDonald Hopkins has two people focused ■ When McDonald Hopkins LLC decided it mainly on the Business Advocate — one in wanted a virtual place for clients, attorneys marketing and one in technical support. and others to interact, it didn’t want to use “I think you’ll see other companies or forums controlled by others, such as Facebook businesses consider something like this,” and LinkedIn, because those could charge Mr. Grassi said. “But it takes time.” for use down the road, said Carl J. Grassi, the — Michelle Park Lazette
WHAT’S NEW
BEST OF THE BLOGS
Our man’s eyes weren’t bigger than his stomach
Excerpts from recent blog entries on CrainsCleveland.com.
Progressive progress
To their credit: Akron-based A. Schulman Inc. entered into a new, $500 million credit agreement with certain credit relationship banks. The supplier of plastic resins said the agreement consists of a $300 million credit facility and a $200 million term loan, replacing a previous $300 million revolving credit facility that was scheduled to expire in January 2016. A. Schulman said the new credit facility includes improved terms, covenants and interest rate pricing over the previous agreement. It expires in September 2018.
Sale on their plate?: Morgan’s Foods Inc. engaged Brookwood Associates as financial adviser to the operator of fast-food restaurants to evaluate what it termed “strategic alternatives to enhance shareholder value.” Morgan’s Foods, with the assistance of Brookwood, will consider a range of options, which may include the sale of stores or groups of stores, a joint venture or other strategic alliances, and a possible sale or merger of the entire company.
Class act: Beaumont School in Cleveland Heights, an all-girls Catholic high school, broke ground on a $9.5 million expansion and renovation project. The expansion at the school’s campus on North Park Boulevard includes a new, 25,000-square-foot building that houses eight science, technology, engineering and math (STEM) classrooms. The project also includes new administrative and guidance offices and a student commons, as well as a new main entrance to the school. The school hopes to open the building in January 2015.
Law firm advocates for its own social media site
COMPANY: ProMark Cabinets, Cleveland PRODUCT: Multifamily kitchen cabinets The cabinet maker has launched a line of real wood kitchen and bath cabinets, available in seven colors, designed specifically for the multifamily housing market. ProMark says it promises to ship made-toorder cabinets in five business days or less. The company’s founder and president, Dave Gordon, said, “We began with a simple idea: apartment owners should be able to remodel a kitchen between tenants and not miss a month’s rent.” The new cabinet line is not made of cheap particleboard, as are so many products for the multifamily market, according to Mr. Gordon. ProMark uses Amish-sourced, solid-oak doors and plywood boxes with heavy-duty hinges. The cabinets come fully assembled “and are built like a tank — perfect for all kinds of rental properties,” Mr. Gordon said. For details, visit www.promarkcabinets.com. Send information about new products to managing editor Scott Suttell at ssuttell@crain.com.
■ Cleveland is one of five major U.S. cities experiencing a “progressive boom,” according to In These Times magazine. The magazine, which describes itself as being “dedicated to advancing democracy and economic justice, informing movements for a more humane world, and providing an accessible forum for debate about the policies that shape our future,” points approvingly to Cleveland; Chicago; Jackson, Miss.; San Jose; and St. Louis as cities that are “on the verge of a progressive upswing.” Cleveland is singled out for its support of the worker-owned Evergreen Cooperatives. (It was a big week for that venture, which also helped Cleveland get tagged as a leader in the “shareable economy” movement.) The magazine also wrote about Richmond, Calif., where Green and Democratic Party activists “are wresting city politics away from Chevron, whose refinery has long cast a dark shadow over the town,” and New Haven, Conn., where union-backed candidates “took control of the city council, only to face the challenge of making progressive change in the age of austerity.”
It adds up ■ Looking for ways to save on health care? A McKinsey & Co. analyst in Cleveland thinks there’s $1 trillion in savings to be had. Tom Latkovic, director of McKinsey’s Cleveland office, said in a video included in a MarketWatch.com post that, by making “the fundamental change” of converting to a system that pays for performance rather than individual services, consumers, employers and taxpayers could save more than $1 trillion over the next decade. Mr. Latkovic “says there is tremendous waste in the system, leaving the cost to de-
liver the same services to vary widely throughout the country,” according to the website. “Even within the same markets, costs can vary from 30% to 100%,” he said in a separate report.
The straight and narrow ■ Would you pay $3.25 million for a 999square-foot townhouse that is 9 ½ feet wide? George Gund IV, a real estate investor and part of the prominent Gund family of Cleveland, did. The Wall Street Journal reported Mr. Gund “is the proud new owner of 75½ Bedford St.” in Greenwich Village, which New York’s Landmarks Preservation Commission identifies as the city’s narrowest townhouse. “I have not always inhabited small spaces, but I think everyone should try it,” Mr. Gund told The Journal. His bed “nearly fills the width of the interior of the house, which he measured at 8 feet 1 inch,” the paper said. The paper noted the purchase price “works out to $3,253 per square foot, among the highest amounts paid per square foot for a townhouse in the Village.” Before he closed on the deal, Mr. Gund told The Journal, “several friends staged an intervention” to make sure he knew what he was doing. The house has two bathrooms, and its galley kitchen comes with a microwave built into the base of the winding staircase that rises to the upper floors.
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