Crain's Cleveland Business

VOL. 37, NO. 51

DECEMBER 19 - 25, 2016

CLEVELAND BUSINESS

Newsmakers of the Year

NEO’s top people, companies and trends of 2016 |

Pages 13-20

Entire contents © 2016 by Crain Communications Inc.

Illustration for Crain’s by Randy Palmer

December 19, 2016

www.ClevelandFoundation.org/Purpose

ADVERTISEMENT

Turning Passion Into Purpose W I T H T H E C L E V E L A N D F O U N D AT I O N

2016 American League Champion Cleveland Indians Rally Together for Larry Doby Youth Fund Francona, entire roster, coaches, support staff, and ownership give $1 million to provide assistance and resources to help curb youth violence As the beloved Cleveland Indians geared up for the post-season this fall, Manager Terry Francona recognized an opportunity to do something amazing.

It was workout day prior to the American League Division Series, and as the players spoke to media and the clubhouse mobilized for a perfect faceoff against Boston, Francona was also busy collecting donation forms from players and staff for underserved youth in Cleveland.

had pooled together more than $1 million.

“I think it was the proudest moment in my baseball life,” Francona would later tell the press.

The idea arose to name the effort in honor of Larry Doby, who was the first African-American player in the major league and the second to break the professional baseball color barrier. The team requested permission from Larry D o b y ’ s family, which enthusiastically gave approval.

He had reflected on the national mood around communitypolice relations, particularly in our nation’s urban centers, and felt compelled “He endured to offer help. many unfair With so many hardships and headline challenges, incidents and handled involving everything minority youth, with the he turned to professionalism the Africanand grace that American players on The Larry Doby statue outside Progressive Field defined him,” Francona said. the team for “It is in Mr. Doby’s spirit we have perspective and advice. created The Larry Doby Youth Fund.”

Then, with the World Series run The Indians turned to the Cleveland looming large, Francona challenged Foundation for administrative support, the team to pause and reflect on including investing, grantmaking their fortunate position in the league expertise and online and text-to-give and to make a difference in the city options that allowed fans to donate to where they play. In just four days, the Larry Doby Youth Fund throughout Francona, the entire roster and all the post-season. coaches, support staff and ownership

“Larry Doby is an icon in our community, and the Cleveland Indians are true champions for continuing his civic legacy at all levels of the organization,” said Ronn Richard, President and CEO of the Cleveland Foundation. “By giving back to Cleveland and Top: 2016 Cleveland Indians Right: Cleveland Indians serving their Manager Terry Francona. youngest fans, the Cleveland Indians and their uniformed personnel in this instance demonstrate once again why we are proud to root for the home team.”

In less than a week, the Larry Doby Youth Fund of the Cleveland Foundation was incorporated with an express purpose to provide assistance to the underserved youth of the city by supporting nonprofit organizations in Greater Cleveland that provide educational assistance and resources to help curb youth violence.

“We were thrilled to work with the team and help them achieve their philanthropic goals,” said Kaye Ridolfi, Cleveland Foundation Senior Vice President of Advancement. “Their athletic success has already taken our city to new heights, and everyone is excited to see how their generosity makes an impact in the future.”

The Cleveland Foundation will announce the grant application process

“I think it was the proudest moment in my baseball life.”

-Terry Francona, Cleveland Indians Manager

for nonprofit organizations in January 2017. A committee of Cleveland Indians ownership, management and players will review the requests for funding and select their first round of grantees, which will be announced in the spring.

“We have enjoyed a special season here in Cleveland because of the incredible group of individuals in our clubhouse,” Francona said. “They are committed to the city in which they live and work

To learn more about giving through the Cleveland Foundation, please call 877-554-5054.

GROWING WITH PURPOSE FOR 102 YEARS Established in 1914 as the world’s first community foundation, the

For more information on the Cleveland Foundation, please visit

Cleveland Foundation has helped Greater Clevelanders turn their

www.ClevelandFoundation.org and follow us at

passion into purpose for more than a century. The foundation is one of

Facebook.com/ClevelandFoundation or @CleveFoundation on

Ohio’s largest grantmakers and one of the largest community foundations

Twitter and Instagram.

in the country, with assets of $2.1 billion and 2015 grants of $95 million.

and have generously donated to The Larry Doby Youth Fund. We are very fortunate to be a part of Major League Baseball, and we accept the social responsibility that comes with that— to use our resources to directly make an impact on the underserved youth of our community, and to make our community better.”

For more information on the fund, visit: www.ClevelandFoundation.org/ LarryDobyYouthFund.

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E 3

Making a full court press for Quicken Loans Arena renovation

Artist renderings of the proposed exterior and interior rennovation of Quicken Loans Arena. (Cleveland Cavaliers)

Glass wall highlights $140 million public-private proposal for refurbishing aging facility

By JAY MILLER jmiller@crain.com @millerjh

In typical Cleveland fashion, the community’s government, business and civic leaders are going “All In,” in Cavalierspeak, to sell the planned $140 million in renovations at Quicken Loans Arena to the public.

The united community push — and maybe a little overselling — for the $140 million transformation is designed to keep the Cavaliers in the building, and the city, for the next 18 years.

The project will put an additional 75,000 square feet of space under roof, enclosed by a glass curtain wall.

The space will be used to make it easier and quicker for the Cavaliers’ capacity crowds to enter the building, creating more selling space for arena concessionaires and more gathering space for Cavs fans.

The plan is for the city and the county, with the acquiescence of Destination Cleveland, the publicly funded tourism nonprofit, to cover half the $140 million cost of improvements to Quicken Loans Arena with the owner of the Cavaliers, the building’s prime tenant, paying the rest and, importantly, agreeing to pay any cost overruns.

It’s a major financial commitment for the city and the county, both of which are strapped financially. However, as Cuyahoga County Executive Armond Budish emphasized at the press conference announcing the plan last Tuesday, Dec. 13, the public’s $70 million share of the cost will be financed without raising taxes.

The public money will come by diverting county hotel bed tax money, extending the term of a Cleveland admissions tax and allocating unspent county sales tax dollars initially designated for construction of the Hilton Cleveland Downtown hotel to the Q project.

It’s also a significant investment by the Gilbert organization. The Q is 22 years old, an age when owners elsewhere are asking their cities for new

buildings, paid for largely or entirely with public money.

It would be hard to find an economist who would agree that spending $70 million, much less $140 million, of public money on a place where 20,000 people who can afford tickets costing $50 or more can watch multimillion-dollar athletes play basketball is sound fiscal policy. So the owner of the Cavaliers is making a comparatively generous financial commitment to the city.

The deal must still be approved by the city’s and the county’s councils.

Some on those councils already are asking how money can be found for a big downtown project while their neighborhoods struggle.

But for striving middle market cities, attaching their name to a group of Grizzlies (in Memphis), Bucks (Milwaukee), Cavaliers, Indians or Browns, is seen as a perquisite for attracting new businesses, talent and residents.

Attorney Fred Nance, global man-

aging partner of the Squire Patton Boggs law firm, pointed out with pride at the news conference that it’s to the advantage of Cleveland that it is the smallest city with a trifecta of teams in three major league sports.

Meeting with Crain’s Cleveland Business after the news conference, Budish said, “This is crucial to our moving forward, that’s why the city and the county have embraced coming up with a deal that makes sense for all the parties. Without Quicken Loans Arena, you wouldn’t have a vibrant East 4th Street, you wouldn’t have a vibrant hotel scene now, you wouldn’t have all the things that are going on in Cleveland with Quicken Loans Arena.”

The dealmakers may be overselling the deal, though, when they tout the financial impact of the project using a Cavaliers-sponsored financial impact study. That study, prepared

by Plano, Texas-based consulting firm Conventions, Sports & Leisure International, claims — not accu-

rately it turns out — that the arena injects $245 million in direct spending annually into the community.

First, the $245 million figure is a calculation of spending in 2016.

That’s a figure that won’t be achieved in future years. Second, it doesn’t discount the number for what is called substitute spending.

Asked in an email exchange with Crain’s to break down that number, CSL president Bill Rhoda said the figure includes between $40 million and $45 million generated by the Republican National Convention. In addition, in the text that supports the financial impact analysis that came up with that $245 million, CSL notes that, “it is estimated that approximately 25 to 30 percent of the direct spending … would take place locally regardless of the presence of the Arena and Team.”

That’s money that would be spent on restaurants, movie theaters or other entertainment venues instead of on basketball tickets and hot dogs if the city had no basketball team.

So, subtracting $40 million in RNC spending and reducing the direct spending figure by another $61 million (25% of the $245 million) that would mean that $144 million is a more accurate figure of the future financial impact of Quicken Loans Arena on the community. That 59% reduction, in turn, would reduce as well the $44 million in annual tax revenue the study said would be returned to the city and county annually, a key argument being used to generate support for the public outlay.

It’s likely the deal will meet with approval from the government councils, despite the large dollar outlay. After all, in 2014 voters approved the extension of the sin tax — the tax on cigarettes and alcohol — that would pay for $260 million in improvements to the Q, Progressive Field and FirstEnergy Stadium by a 56%-44% margin.

Most council members contacted weren’t ready to take a stand. Some were a little indignant that they didn’t know a deal was done until they saw it in the news.

However, Cleveland city councilman Jeff Johnson said he’s against it.

“I am not going to vote for it,” he said in a telephone call. “I believe it’s an exciting project but I don’t think the admissions tax should be used. It should be all private dollars.”

The deal also will put a crimp in the efforts of Destination Cleveland to attract visitors at a time when the organization is trying to sell the city to vacationers and convention planners in the positive glow created by the successful GOP convention, the Indians' World Series trip and, ironically, the Cavaliers winning the National Basketball Association championship. The organization was long considered underfunded, at about $7 million annually and it worked hard over the last decade to raise that.

In a telephone call, Dan Walsh, chairman of the convention and visitors bureau, and David Gilbert, the organization’s president, voiced their support for project that would take a little more than $2 million a year — $44 million over 18 years — from the annual $16 million budget they use to promote the region.

“We think the Q renovation is important for the city and important for our portfolio,” Walsh said of one of the major attractions the bureau promotes. “We definitely are at a peak and will continue to grow as a community from a tourism perspective.

So we’re looking at smoothing the impact (of the budget cut) so we don’t lose momentum.”

Gilbert said the organization is looking at a number of cuts. It may trim its sales and marketing to convention planners, its social media efforts and its out-of-town advertising.

“We believe we’re effective at what we do,” Gilbert said, citing studies that show the region’s growth in tourism spending exceeds state and national benchmarks. “It’s no accident that when we get sufficient resources, the results are there.”

Of course, a winning basketball team has also boosted interest in the city among convention planners and tourist.

PA G E 4

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

THANK YOU! 115+ Transactions in 2016 The Coyne Team is pleased to thank all of the clients who bought, sold or leased commercial properties in 2016.

You consistently make us a leading brokerage team in Northeast Ohio.

Visit

TerryCoyne.com Or call Terry at

216.453.3001

1350 Euclid Ave., Suite 300 Cleveland, Ohio 44115

The University of Akron is moving forward on a “Transformation Plan” to cut costs and raise revenue. (AkronStock)

U of A enlists E&Y’s help to ‘stabilize,’ ‘invest’ and ‘grow’

By RACHEL ABBEY MCCAFFERTY rmccafferty@crain.com @ramccafferty

WE HAVE THE PERFECT GIFT FOR YOUR BUSINESS

Commercial Real Estate Financing • SBA Loans Construction Loans • Refinancing Options Contact Jonathan A. Mokri 440.526.8700 • jmokri@cbscuso.com • www.cbscuso.com Providing Commercial Loan Financing in Partnership with Area Credit Unions SM

HERE WE GO AGAIN. The health insurance tides are changing once more.

PROTECTED? CALL US. 216 350 5052

The University of Akron is moving forward on a two-year “Transformation Plan” designed to cut costs and raise revenue. The goal is for both of those measures to generate more than $60 million for the university that has struggled in recent years with falling enrollment and declining donations.

The plan all goes back to the idea of “stabilizing, investing and growing,” said university president Matthew J. Wilson, who took on the position in an interim role in July and in an official role in October, filling the spot left vacant by Scott L. Scarborough earlier this year.

In early December, the university hired Ernst & Young LLP to help implement its plan. The contract with the professional services firm is for six months, with one-month extensions available for 18 months after that. The firm had worked with the university on a report about its finances before the plan was created, which found that, if the university didn’t take action, revenue was expected to continue to fall and expenditures to grow.

The tasks in the plan are divided into the categories of “stabilize,” “invest” and “grow.” Under stabilize, there are goals like increasing student retention and reducing expenses in areas like IT or travel. Invest includes hiring a “transformation leader” and investing in reporting and analytics. And the “grow” task spans more than just enrollment — it also includes growth of employer partnerships, community college partnerships and the school’s endowment.

And while Wilson said he doesn’t want to enact big sweeping cuts, the university is enrolling fewer students, and that means some things will have to change.

“There needs to be a natural adjustment there,” he said.

For instance, if the university looks at its numbers and realizes 3,000 fewer students need to take English composition, the school doesn’t

CLEVELAND BUSINESS

We Protect. You Grow.

LEARN MORE J

www.armadarisk.us

700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113 Phone: 216-522-1383 www.crainscleveland.com Customer service and subscriptions: 877-824-9373

need to offer as many sections as it does, Wilson said. Or, if numbers are way down in a major, the university could have some faculty switch to teach other Wilson courses or to turn their focus to grant-seeking.

The plan does account for buyouts, though Wilson said details aren’t available yet. The university wants to meet with constituents to discuss what the buyout process could look like, instead of just implementing it and telling them after the fact.

The buyout has, by far, the largest two-year target of $20 million of the initiatives listed in the plan, though many targets have yet to be determined.

The statement of work signed with Ernst & Young outlines, in detail, the goals of the plan, along with the target for how much each item could yield in savings or revenue in fiscal years 2018 and 2019. Some of the parts of the plan, like the strategy for international students and the future employee buyout, are being overseen by just the university. The majority of the efforts, though, are being supported by Ernst and Young.

The firm will receive $200,000 per month, plus “reasonable expenses” through the first six months of the contract and, if it’s extended, the next six months. If the work extends into the year after that, Ernst & Young would receive $150,000 per month, plus the expenses.

In large part, its work will focus on providing data and analytics support to the university. For example, in the area of graduate assistantships, Ernst and Young may compare how total spending and spending per student compares to other institutions in the state.

Or, in terms of enrollment, the firm could look at whether recent initiatives affected enrollment in any way.

Overall, Wilson wants to streamline the university’s costs without making big cuts, unlike the major personnel and program cuts of recent years. And Wilson wants to

make sure he’s gathering input from a variety of sources, from administrators to staff to faculty to the community at large.

“It’s my goal that we all come together and unify,” he said.

Wilson said that the university needs to do a better job of sharing its stories of success, which will be a big focus of its marketing efforts. There also needs to be a greater focus on flexibility and options for traditional and non-traditional students, he said. That might include bringing back some evening programs.

A big area of focus for recruiting will be international students. Wilson said he is looking to create a center in that space, as well as hire to support it. He’s looking for candidates to fill a vice president-level and director-level positions, as well as an executive director of international admissions and recruiters.

The university also has been hiring in its admissions office and in fundraising and development, Wilson said. And he’s looking to hire a permanent chief diversity officer, in addition to some ongoing faculty searches.

The strength of the university is important beyond campus. For example, the focus of the Knight Foundation in Akron is to attract and retain talent, said Kyle Kutuchief, the foundation’s program director in Akron.

“University of Akron is key to that strategy,” he said.

The Knight Foundation saw the university’s struggles in recent years as an opportunity to support the school, Kutuchief said, giving the W. Gerald Austen Endowed Chair in Polymer Science and Polymer Engineering as an example. It was a chance to remind people of the university’s strengths.

Another strength is the university’s downtown location. Students have access to a wide variety of internships, Kutuchief said, though he thinks the community can do a better job of extending opportunities like that to students. Overall, one of the greatest challenges facing the university now is enrollment, but he thinks Wilson is addressing it.

“I think Akron has a strong case to make to students,” Kutuchief said.

Volume 37, Number 51 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly at 700 West St. Clair Ave., Suite 310, Cleveland, OH 441131230. Copyright © 2016 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00.

Subscriptions: In Ohio: 1 year - $64, 2 year - $110. Outside Ohio: 1 year - $110, 2 year - $195. Single copy, $2.00. Allow 4 weeks for change of address. For subscription information and delivery concerns send correspondence to Audience Development Department, Crain’s Cleveland Business, 1155 Gratiot Avenue, Detroit, Michigan, 48207-9911, or email to customerservice@crainscleveland.com, or call 877-8249373 (in the U.S. and Canada) or (313) 446-0450 (all other locations), or fax 313-446-6777.

POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912.

1-877-824-9373.

Reprint information: 212-210-0750

CRAIN’S CLEVELAND BUSINESS

Akron’s Apple Growth Partners expands in NEO with KPFF deal

D E C E M B E R 19 - 2 5 , 2 016

jnobile@crain.com @JeremyNobile

Elizabeth McIntyre Scott Suttell Tim Magaw David Kordalski Damon Sims Sue Walton Kevin Kleps Stan Bullard Real estate/ construction Jay Miller, Government Dan Shingler, Energy/steel/auto Rachel McCafferty, Manufacturing/energy Jeremy Nobile, Finance Lydia Coutré, Health care Chuck Soder Rich Williams

Reporters

Robert Neides, KPFF senior partner

customer attentiveness smaller firms tend to offer.

At the same time, the merger seemed like a better succession plan than what KPFF already had in place, he said, because of the benefits to client service emboldened by a larger firm and growth potential for staff.

Apple Growth, founded in 1943, has wanted to increase its Cleveland presence for some time, Mullen said.

And growing in this market is a pillar of the firm’s plan to double in size by 2020, an initiative laid out by Mullen in June that, at the time, meant hitting $20 million in annual revenues and a staff of at least 160.

“A big part of our growth strategy is growth in Cleveland,” said Mullen, who joined Apple Growth following the firm’s last acquisition in 2008 of Akron’s Brott, Mardis & Co. “We also have a pretty large and expanding real estate niche in our practice and we’re looking to add depth and bench strength to that. So KPFF fit like a glove for us.”

Real estate work composes about 40% of KPFF’s work today, marking a practice that the firm has become

known for.

“KPFF isn’t just real estate, of course. They’ll also fulfill our other areas of focus as well,” Mullen said.

“And from a staffing perspective, we believe this is an opportunity for our people to grow in their careers with an even larger firm.”

With the merger, Neides will join Apple Growth as a principal and member of the executive committee.

He’ll lead the Beachwood office along with KPFF partner Karen Vaughn. KPFF managing member L.S. Fishman, who joined KPFF in the 1960s, will take an ongoing role with AGP in client development. The trio comprise KPFF’s board of trustees.

In the bigger picture, the KPFF deal is a pivotal moment in achieving additional scale as the business eyes significant growth targets in 2020.

“But as we grow, it’s important we don’t grow red tape with us,” Mullen emphasized in describing their approach to the market. “We want to make decisions quickly and be able to maintain a client-focused approach, and that’s what we mean when we say this is a big-small firm.”

PA G E 5

700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 Phone: (216) 522-1383 | www.crainscleveland.com | @CrainsCleveland

Publisher/editor Managing editor Sections editor Creative director Web editor Associate editor/Akron Assistant editor Senior reporter

Charles Mullen, Apple Growth partners chairman

|

CLEVELAND BUSINESS

By JEREMY NOBILE

Akron’s Apple Growth Partners has announced its first acquisition under a growth plan intended to double the size of the business by 2020.

KPFF LLC of Beachwood has agreed to merge with AGP effective Jan. 1 in a move that brings the combined firm to about $14 million in annual revenues and a staff of 90.

Terms of the deal were not disclosed.

All KPFF staff — about 17 — are expected to make the transition, said KPFF senior partner Robert Neides, with the firm’s Beachwood headquarters adding a third location to Apple Growth’s current offices in Akron and Cleveland.

Neides said KPFF, founded in 1961, had been approached numerous times in recent years about a potential merger. He said he met with Apple Growth chairman Charles Mullen early this past summer as a kindness for a mutual business associate who introduced the two with every intention of downplaying any interest in a merger.

“My goal was to meet and tell him I had no interest, so I was completely surprised after a short period of time talking background and philosophies how much we had in common,” Neides said. “What I described to Chuck, he described back to me. It was like a mirror image.”

That conversation was largely about cultural fit, Neides said, adding that both firms share a mentality as “big-small” firms — a reference to having size, but not losing a level of

|

Data editor Cartoonist ***

Events manager Ashley Martin Events coordinator Megan Lemke Integrated marketing manager Michelle Sustar Managing editor custom/special projectsAmy Ann Stoessel Advertising director Nicole Mastrangelo Senior account exec. Dawn Donegan Account executives Lindsie Bowman John Banks Laura Kulber Mintz

Office coordinator *** Digital strategy/ audience development director Production director Production assistant/ video editor Billing Credit

Denise Donaldson

Nancy Hanus Craig L. Mackey Steven Bennett Peter Iseppi Rod Warmsby

CRAIN COMMUNICATIONS INC. Chairman President Treasurer CIO CFO Group publisher Senior Executive VP

Keith E. Crain Rance Crain Mary Kay Crain Anthony DiPonio Bob Recchia Mary Kramer William A. Morrow

Exec. VP/director of strategic operations Chris Crain Exec. VP/director of corporate operations KC Crain VP of production and manufacturing Dave Kamis ***

G.D. Crain Jr., Founder (1885-1973) Mrs. G.D. Crain Jr., Chairman (1911-1996) ***

Reprints: 212-210-0750 Krista Bora kbora@crain.com Customer service and subscriptions: 877-824-9373

CAN YOU FEEL THE HEAT? Hold onto your seat because we’re giving away $500 FREE PLAY every 15 minutes from 2PM to 8PM every Friday and Saturday in January!

Simply play with your Rock Star Rewards card to be eligible to win.

Not a Rock Star Rewards member? Membership is FREE so join today and win your share of $100,000 in FREE PLAY prizes!

VEGAS EXPERIENCE. OHIO ADDRESS.

HRRNP.COM • 330.908.7625

Must be 21 years of age or older. Non-transferable and non-negotiable. Hard Rock Rocksino Northfield Park Management reserves the right to void any entry, and/or alter, cancel or modify this promotion at any time with prior notice and Ohio Lottery Approval. Other restrictions may apply. See Players Club for details. For free, confidential help 24/7, call the Ohio Responsible Gaming Helpline at 1.800.589.9966. ©2016 Hard Rock International (USA), Inc. All rights reserved.

PA G E 6

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

Exciting Land Opportunity near Cleveland Clinic 5.89 Acres with Frontage on both Carnegie & Euclid Avenue

N

Euclid & Carnegie Avenue, Cleveland, OH • Near Cleveland Clinic, University Hospital and Cleveland State University • Located in Midtown District • Easy access to RTA route

• Zoned for Midtown Mixed Use District 1 & 3 • Frontage on both Carnegie (305’) and Euclid Avenues (210’)

Joseph Martanovic

216.861.5434

JosephMartanovic@HannaCRE.com

HannaCRE.com

Northern Ohio’s Premier Air Charter Service

A rendering shows how Link59 will look from Euclid Avenue. (Contributed photo)

Midtown attracts developers’ interest

By JAY MILLER

LLC AIR CHARTER SERVICE AIRCRAFT MANAGEMENT

Providing a unique private travel experience focused on Safety, Service and Professionalism 10, 25 and 50-hour Jet Cards available Complimentary In-Flight WI-FI www.FlySkyQuest.com • 216-362-9904 Charter@FlySkyQuest.com

COMMERCIAL REAL ESTATE SERVICES Visit naicummins.com or call 330-535-2661

jmiller@crain.com @millerjh

Cleveland’s Midtown neighborhood and its Health-Tech Corridor are about to grow again.

Two projects — one a new hotel, the other the redevelopment of a vacant building — are seeking help from Cuyahoga County to move ahead. Neither is ready to get construction underway, but the activity is a good sign for the Corridor, which was created to attract businesses connected to the medical and health care industries.

Health Tech Hospitality LLC, a group that includes David Fischback, president and co-chairman of the Krill Co., and Chris Kaczmar of Kaczmar Architects Inc., is developing a 123-room hotel at the corner of East 70th Street and Euclid Avenue.

Brian Smith, the third principal in the investment group, described the hotel as an “upscale, economy hotel,”

possibly under the Tru by Hilton brand. Tru is a new Hilton concept that targets younger travelers with a modern, open design, advanced technology and work-and-play public spaces.

Though downtown Cleveland and University Circle, areas which bracket Midtown, have seen considerable hotel development, the group’s market study showed an unmet need for the $99 room rate and free parking their hotel would offer.

Jeff Epstein, executive director of Midtown Cleveland Inc., a nonprofit development organization, said the developer also was attracted by the development of the office market in Midtown, which includes Midtown Tech Park and the new headquarters of Dealer Tire.

“It’s anticipated that the market study shows the need is there,” Smith told a county loan committee. “We realize we’re ahead of the curve when it comes to investing in this neighborhood.”

The project is in its early stages, and the group does not yet control

the land. The group is seeking a fiveyear, $500,000, 3% loan from Cuyahoga County to resolve environmental problems on the site. County council is expected to consider the loan in January.

The ownership of the 2.2 acres the hotel would occupy is currently divided between the city of Cleveland, which has agreed to sell its parcels for $1, and MidTown Cleveland.

Owner equity and a bank loan are expected to round out the financing.

The developer anticipates the project will create 20 jobs with an annual payroll of $750,000.

Given the need to assemble the land and the environmental issues, Smith said the hotel opening could happen in anywhere from two-anda-half years to as many as five years.

A few blocks down Euclid, the principals in Hemingway Development are planning to kick off their ambitious Link59 project with the redevelopment of a 30,000-square-foot building at East 61st Street and Euclid that once was home to Ace Fixtures, a restaurant supply business.

Hemingway partner Jim Doyle said his firm plans a $5.3 million renovation to turn the building into the Phoenix Building, an office building that largely is pre-leased.

The developer is asking the county for a $1.5 million loan, with one-third forgivable if job creation goals are met. The project is pledged to retaining 30 jobs and to create 24 jobs.

JobsOhio also is expected to help with the financing. The developers are seeking a $3.36 million loan from the state economic development nonprofit.

It’s a first step in Link59, a 12-acre campus at East 59th Street north of Euclid that the state of Ohio cleared for a mental health hospital that was never built.

Link 59 is the next step in the developers Midtown plans, following the nearby Midtown Tech Park, which opened in 2008.

“Thankfully, we are finally filling up Midtown Tech Park,” Doyle told county officials. “Prospects, as they come and express their desire to be in Midtown, the inventory is quickly going away.”

Doyle said he has two tenants tentatively committed to the Phoenix Building. He would not identify them.

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E 7

Emanate Wireless aims to cut hospital costs with equipment tracking devices

By LYDIA COUTRÉ lcoutre@crain.com @LydiaCoutre

A Cleveland company has developed a device that can give hospitals a heads up days or even a week ahead of time when one of its refrigerators may fail.

That warning could save hospitals hundreds of thousands of dollars lost in pharmaceuticals, samples, tests and more, said Neil Diener, CEO of Cleveland-based Emanate Wireless, a health care technology company that created this device as well as another that can help hospital workers track the location of various pieces of equipment in the system.

As for the refrigerator device, spoilage can be a big, costly issue that could mean asking patients to redo samples, he said. “We can protect those valuable assets that are in the fridge by monitoring the fridge itself,� Diener said. “So that’s our premier product.�

Emanate, whose lead distributor is Accruent Healthcare Solutions, has raised a total of $1.5 million in angel funding to support its growth selling devices that track equipment location, use and status within a hospital.

It has developed two products that have been on the market since June.

There are other technologies available that do pieces of what Emanate’s devices do, but not all together. There are devices that monitor temperatures, or track equipment, said Todd Stewart, director of enterprise workflow solutions at Accruent.

Emanate’s devices can do all of that and let users know about the sta-

PowerPath can track the location of a medical device and monitors whether the equipment is in use. (Contributed photo)

tus of equipment. “It’s built on a scalable platform,�

Stewart said. “And it does more than the other technologies that were currently available to us.

Emanate is in what Diener calls the execution phase of growing revenue, sales and number of customers. It has devices in a couple Cleveland Clinic locations and is rolling it out in a yet-to-be named system in Pennsylvania. There are a few more pilots ongoing, and Diener said he expects to see three to five clients pick up the devices in the first quarter of 2017.

Clinic officials declined to comment other than to confirm they do use the Emanate technology.

The Power Path Temp device monitors the power line for temperature control equipment and automatically logs data, which Diener said is a

time-consuming process that now is done manually. Emanate then can analyze that data and detect issues, such as noting that a laboring compressor, low coolant levels or simply an ajar door. It can alert officials and give them the chance to address

problems before losing the contents. “That’s super valuable to the hospitals because the spoilage is very expensive,� he said.

Its second device is the Power Path Asset, which is targeted at a mobile equipment that plugs in, such as ventilators, monitors, specialty beds, pumps and portable ultra sounds, Diener said.

The Power Path Asset can track the location of equipment, and it monitors whether the device is in use.

That, he said, turns out to be important for a couple of reasons. For one, nurses, doctors or other hospital personnel can save time by looking at where a piece of equipment is and whether it’s actually available. “But probably more importantly to the hospital, the value of our usage data is also in understanding how many devices they actually need,�

Diener said. “What happens is often the nurses will feel that we need more of this kind of pump or monitor because when we try to find one we can’t find one available. And so it goes to the finance side to say do we need to order 100 of these?�

The Power Path Temp and the

Power Path Asset are Emanate’s two initial products, but Diener said they’re looking to build more to use with its cloud-based server, which collects and analyzes the data from the monitoring devices.

Prices vary, but the devices cost roughly $200 per monitor and then about $100 for a subscription for the data. Emanate’s business model is to sell the monitors and then the yearly subscription fee for analytics.

Pradeep Kaul, an angel investor representing an investor consortium, had invested in a previous company led by Diener and a group of other entrepreneurs.

Emanate is the third company for Diener and this group of “serial entrepreneurs.� Kaul invested in their most recent one, Cognio, which was acquired by Cisco in 2007.

Kaul knew their work, and decided to invest again. “It became a very interesting application within the hospital,� Kaul said. “And I think that’s what we’re going to find is as time goes on, there will be more and more such cost-savings type applications that will come up.�

May the Warmth of the Season

Light Your Way Throughout the Year.

Are you an individual with $10 million or more seeking advice?

Advice and insight across generations 5PEBZ CBDLFE CZ UIF FYQBOTJWF HMPCBM SFTPVSDFT PG 6#4 BOE JUT ZFBS USBEJUJPO PG TFSWJOH TPNF PG UIF XPSMEà T XFBMUIJFTU GBNJMJFT PVS UFBN IBT OFWFS CFFO CFUUFS QPTJUJPOFE UP TFSWF PVS BGGMVFOU DMJFOUT BOE UIFJS GBNJMJFT 'SPN DPNQMFY NVMUJHFOFSBUJPOBM QMBOOJOH UP XFBMUI QSFTFSWBUJPO TUSBUFHJFT BOE USBOTGFS XF BSF ZPVS USVTUFE TPVSDF PG GJOBODJBM TUFXBSETIJQ BOE BEWJDF Cleveland Wealth Management Team William G. Murphy, CIMAŽ 4FOJPS 7JDF 1SFTJEFOUž 8FBMUI .BOBHFNFOU 1SJWBUF 8FBMUI "EWJTPS

Owen C. McBride, CFPŽ, CLU 4FOJPS 7JDF 1SFTJEFOUž 8FBMUI .BOBHFNFOU 1SJWBUF 8FBMUI "EWJTPS

Chad Arthur Hartup, CFPÂŽ, CRPCÂŽ, CLU 4FOJPS 8FBMUI 4USBUFHZ "TTPDJBUF

UBS Financial Services Inc. 4VQFSJPS "WF &BTU UI 'M $MFWFMBOE 0)

ubs.com/team/cwmt $FSUJĹ–FE 'JOBODJBM 1MBOOFS #PBSE PG 4UBOEBSET *OD PXOT UIF DFSUJĹ–DBUJPO NBSLT $'1ÂŽ and CERTIFIED FINANCIAL PLANNERĂ? JO UIF 6 4 $*."ÂŽ JT B SFHJTUFSFE DFSUJGJDBUJPO NBSL PG UIF *OWFTUNFOU .BOBHFNFOU $POTVMUBOUT "TTPDJBUJPOÂŽ JO UIF 6OJUFE 4UBUFT PG "NFSJDB BOE XPSMEXJEF $IBSUFSFE 3FUJSFNFOU 1MBOOJOH $PVOTFMPS4. BOE $31$ÂŽ BSF SFHJTUFSFE TFSWJDF NBSLT PG UIF $PMMFHF GPS 'JOBODJBM 1MBOOJOHÂŽ "T B GJSN QSPWJEJOH XFBMUI NBOBHFNFOU TFSWJDFT UP DMJFOUT XF PGGFS CPUI JOWFTUNFOU BEWJTPSZ BOE CSPLFSBHF TFSWJDFT 5IFTF TFSWJDFT BSF TFQBSBUF BOE EJTUJODU EJGGFS JO NBUFSJBM XBZT BOE BSF HPWFSOFE CZ EJGGFSFOU MBXT BOE TFQBSBUF DPOUSBDUT 'PS NPSF JOGPSNBUJPO PO UIF EJTUJODUJPOT CFUXFFO PVS CSPLFSBHF BOE JOWFTUNFOU BEWJTPSZ TFSWJDFT QMFBTF TQFBL XJUI ZPVS 'JOBODJBM "EWJTPS PS WJTJU PVS XFCTJUF BU ubs.com/workingwithus h6#4 "MM`SJHIUT SFTFSWFE 6#4 'JOBODJBM 4FSWJDFT *OD JT B TVCTJEJBSZ PG 6#4 "( .FNCFS '*/3" 4*1$ @"E@ Y @-% @.D#0 *4 &YQ

myNYCB.com • (877) 786-6560

Š2016 New York Community Bank

PA G E 8

|

CRAIN’S CLEVELAND BUSINESS

D E C E M B E R 19 - 2 5 , 2 016 |

The ACE Report AHOLA. CRAIN’S. EMPLOYMENT Crain’s Cleveland Business has partnered with The Ahola Corp., a payroll and human capital management firm in Brecksville, and local economist Jack Kleinhenz to provide monthly data — and clarity — about a key factor in business decisionmaking: the size of Northeast Ohio’s workforce.

Seasonally adjusted employment numbers, Northeast Ohio JULY: 1,175,087 AUGUST: 1,171,162 SEPTEMBER: 1,169,567 OCTOBER: 1,172,386 NOVEMBER: 1,172,672 1,155,000

1,160,000

1,165,000

1,170,000

1,175,000

Northeast Ohio posts small employment gain in November

By SCOTT SUTTELL ssuttell@crain.com @ssuttell

GIVING Y

r

o

ty

WAY¡ a k

fou n dat

i

UR O

o

n¡

n

c o mmu n

i

Akron Community Foundation i nv i tes you in to a w h o le new world of giving: one that’s inspired, connected and deliberate. A Donor-Advised Fund at Akron Community Foundation helps you support the causes you believe in – now or in the future, here or across the country – while providing the maximum tax benefit at precisely the moment you need it. You also get local insight, responsive staff and more than 60 years of expertise.

We help everyday people become philanthropists. Discover how a Donor-Advised Fund can help you at www.akroncf.org/fund.

www.akroncf.org | 330-376-8522

Northeast Ohio eked out a small employment gain in November, according to the latest Ahola Crain’s Employment (ACE) Report.

Seasonally adjusted employment in November for the seven-county area of Cleveland and Akron measured by the report was 1,172,672, a gain of just 286 jobs from 1,172,386 in October.

The change is small, but Jack Kleinhenz, the Cleveland Heights economist who created the ACE Report model noted it was unusual in this respect: The region lost 152 service jobs from October to November, but it added 438 jobs in goods-producing fields.

"The offset is a turnaround from recent trends where the growth in service jobs offset losses in manufacturing," Kleinhenz wrote in an analysis of the November ACE Report data.

The region remains in positive jobs territory from a year ago. Kleinhenz said November employment in Northeast Ohio was up by 4,570 jobs from the like month of 2015.

November’s jobs figure also is above the ACE Report's seasonally adjusted three- and six-month averages, which "suggests economic activity and job growth has picked up some momentum from the slower pace of job growth the region experienced in the second quarter," according to Kleinhenz.

Underlying November’s ACE Report figures are some positive regional and national trends.

For instance, Kleinhenz wrote in his analysis that unemployment claims for the region "decreased by 22% over the same month a year ago. Coincidental measures for Ohio are up 2.2%, and construction put in place and retail sales show gains in the last three months."

National indicators show an economy that is picking up the pace.

U.S. Gross Domestic Product was

/C[QT /GTNG 5 )QTFGP 'EQPQOKE &GXGNQROGPV &KTGEVQT ,KO &QWVV ,COGU &QWVV"$GCEJYQQF1JKQ EQO

999 $'#%*911&1*+1 %1/

5KPEG OQTG VJCP

/+..+10 JCU DGGP KPXGUVGF D[ $GCEJYQQF $WUKPGUUGU

www.crainscleveland.com/newsletters Small Business -- People on the Move -- Middle Market

COMING NEXT WEEK

Crain’s Annual Book of Lists This data resource is the culmination of Crain’s year-round efforts to gather details on businesses in Northeast Ohio.

Chapters include:

SIGN UP FOR ONE OF OUR INDUSTRY NEWSLETTERS Sports Business -- Real Estate -- Health Care -- Manufacturing

revised higher to 3.2% for the third quarter, which Kleinhenz wrote is a "significant number relative to the average 2.2% growth we have seen in this expansion."

The Institute for Supply Management's manufacturing index in November posted a reading of 53.2, which ties the fastest pace of this manufacturing sector indicator over the past 18 months, according to Kleinhenz. (A reading above 50 indicates the sector is expanding.)

He also noted that the Federal Reserve's Labor Market Conditions Index, a broader measure of the health of the labor market than provided by any single report, "indicates that the labor market is continuing its path of improvement."

The Fed's labor index increased by 1.5 points in November, about the same level of improvement as in October.

"All in all, these national trends should be a good indicator of what to expect at the state and regional levels," Kleinhenz concluded.

"EACHWOOD YOU HAVE ARRIVED

7HEN YOU RE IN

Company Data Civic Engagement Finance Professional Services Healthcare Real Estate

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E 9

Perspectus acquires Akron firm known for rehab work

By STAN BULLARD sbullard@crain.com @CrainRltywriter

Akron-based Chambers, Murphy & Burge Historical Architecture, which limits its practice to historic restoration, has merged with Perspectus Architecture of Cleveland.

The acquisition adds six staffers to Perspectus, taking its total staff to 51. That includes adding three registered architects to give Perspectus a total of 27.

Chambers, Murphy & Burge will maintain its office in downtown Akron and will continue to use its name with the designation that it's a studio of Perspectus, said Larry Fischer, a managing principal of Perspectus.

The female-owned Chambers, Murphy & Burge is well-known within historic preservation circles for providing property owners, developers and fellow architects with detailed preservation and rehabilitation design and specifications for materials and methods. It's known particularly for providing specialized approaches to "uncommon situations" in conserving buildings from the 18th, 19th and 20th century, as well as helping craft applications for historic district designations for cities and developers.

Elizabeth Corbin Murphy and Lauren Pinney Burge owned the firm for 23 years, continuing the practice of Chambers & Chambers, launched

Ayars

Corbin Murphy

Fischer

Pinney Burge

in Akron in 1963 by the late Jack Henry Chambers and Lorraine Chambers, a couple who were both registered architects and known as pioneers in building preservation.

Both women became principals of Perspectus under the merger announced last Tuesday, Dec. 13, which increased the number of principals at the Cleveland firm to 10. Other terms of the acquisition were not disclosed.

In an interview at the Shaker Square office of Perspectus, Murphy said she and Burge have agreed to continue with Perspectus for at least three years. Succession planning was part of the decision to merge. Another was to seek greater opportunities

by associating with the larger firm.

"Many of my friends who are architects and have firms talk about what they will do," Murphy said. "We are fortunate to have found a perfect match." As about half of the work of Chambers, Murphy & Burge is providing consulting services to other architects, Murphy said it was important to join a firm that accepted such a practice. Fischer said Perspectus also believes in partnering with other firms on assignments.

However, Murphy and Burge clearly are not easing their pace.

"We're really excited about higher education," Murphy said, because the firm sometimes felt it was not considered for projects because of its size.

Moreover, Cleveland and Akron have substantial numbers of older buildings that are experiencing increased interest in restoration because of state and federal tax credits.

Such credits benefit not just residential projects, but those at hospitals and other institutions.

Murphy added that the combined firm will focus on providing services for building owners who may need a third party to help them evaluate how to comply with the city of Cleveland's new facade maintenance ordinance. Meeting standards set in the measure may not be satisfied by simply ensuring the bricks are sealed while there may be a structural issue that may need repair, she said.

SEE PERSPECTUS, PAGE 21

FORTY UNDER 40 25THANNIVERSARY

SME-U WORKSHOP MASTERING THE MICRO-MOMENTS THAT MATTER MOST TUESDAY, JANUARY 10, 2017 Featuring Scott Mowery, Director – Digital Marketing, Cleveland Clinic In today’s digital world, it’s become more clear than ever that people are consuming media much differently than just a few years ago. In order to win over the hearts of consumers today, businesses must embrace a new marketing philosophy from Google called micro-moments. Join Scott as he shares insights on this new trend.

• Learn what micro-moments are and how they have shifted consumer behavior • Identify the four moments of intent for your business • Improve the user experience to win the critical moments of the consumer journey

SME-U workshops are held 7:45-9:15a.m. the second week of every month at: Holiday Inn Cleveland South 6001 Rockside Road, Independence, Ohio 44131 www.hiindependence.com SME Cleveland members $10, Guests $20 R.S.V.P. at 216-767-5951 or online at www.smecleveland.com

SPONSORED BY:

THANK YOU

Now in its 25th year, Crain's Forty under 40 program has honored over 900 individuals for their professional success and civic contributions. Over 300 attendees joined us at the 2016 Awards Party at the Cleveland Public Auditorium for an evening of networking, food and fun.

CO-PRESENTED BY

VIDEO SPONSOR

PHOTO BOOTH SPONSOR

PROUD PRODUCTION SPONSOR

SUPPORTED BY

PA G E 10

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

Opinion

From the pen of Crain’s cartoonist Rich Williams

The only thing funny about 2016 was ...

January 11

March 14

April 4

May 16

May 30

August 29

Publisher and Editor: Elizabeth McIntyre (emcintyre@crain.com)

CLEVELAND BUSINESS

CLEVELAND BUSINESS

Managing Editor:

Scott Suttell (ssuttell@crain.com)

Sections editor:

Timothy Magaw (tmagaw@crain.com)

Contact Crain’s :

(216) 522-1383

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

Sound off: Send a Personal View for the opinion page to emcintyre@crain.com.

Please include a telephone number for verification purposes.

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E 11

September 19

Every shot blocked by the Cavs earns a $100 donation from Elk & Elk to the Cleveland Clinic Children’s 1.800.ELK.OHIO | elkandelk.com/weakstuff

EXCLUSIVE VENUES • PERFECT MENUS EXECUTIVE CATERERS – EXCLUSIVE CATERER FOR CLEVELAND PUBLIC AUDITORIUM AND CONFERENCE CENTER November 14

CLEVELAND PUBLIC AUDITORIUM & CONFERENCE CENTER CONTACT OUR EVENT PLANNERS TODAY TO EXPERIENCE ONE OF CLEVELAND’S MOST ICONIC VENUES TM

440.449.0700 • INFO@EXECUTIVECATERERS.COM WWW.EXECUTIVECATERERS.COM

December 19

PA G E 12

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

Personal View

Don’t underestimate the importance of funding medical innovation

By ARAM NERPOUNI

billion state of Ohio Third Frontier program. It is crucial that this program continues to thrive. The Ohio bioscience industry provides more than 70,000 jobs and is home to more than 2,000 bioscience companies. In Medical researchers are achieving new milestones that once seemed 2013, clinical trials contributed $848.1 million to Ohio’s economy. distant and unattainable, and the pace of medical discovery has inThe Food and Drug Administration (FDA) approved 45 new medicines creased exponentially since the mapping of the human genome. in 2015 that help treat diseases from lung cancer to The challenge now is to continue this progress for schizophrenia, in part because FDA has instituted a the benefit of patients coping with diseases from canfast track review option for promising new drugs. cer to heart disease to diabetes and many, many oth- Funding for medical Ninety percent of poll respondents strongly favor coners. As we look ahead to a new president, a new Congress and a new Ohio governor in the not-too-distant research is an tinued modernization at FDA to keep pace with new future, we must make certain our federal and state opportunity for discoveries. policymakers understand the importance of funding Additionally, poll respondents recognized the value Congress and the medical science. of public-private collaboration in medical research.

Voters strongly support this goal. A recent poll on beNinety-one percent support maintaining funding from half of the Galen Institute and Center-Forward, and in- president to start the both sectors, and 88% believe new research and develvolving voters from 12 battleground states, including year off with a opment partnerships between the government, private Ohio, confirms voters all but unanimously support industry and universities are important. medical discovery as a means to enhance treatments bipartisan initiative Ohio is at the forefront of this trend, thanks in large and cures. Ninety-five percent believe medical innovapart to the Third Frontier Program which provides that has benefits for tion is key to improving America’s health care system. funding to commercialize technology developed by Funding for medical research is an opportunity for both patients and our Ohio research institutions, offers assistance to bridge Congress and the president to start the year off with a the gap between an entrepreneur’s need for capital and bipartisan initiative that has benefits for both patients economy. the traditional sources of financing, and supports and our economy. Nationally, bioscience firms emOhio-based angel and seed funds that provide capital ploy 1.7 million people, with an average annual wage to early stage Ohio technology companies. of over $90,000.

Innovation is certainly a major tenet of health care at the federal as However, research funding from the National Institutes of Health (NIH) well as the state level, and the call to action is loud and clear: Continued is declining, evidence that policymakers are ignoring a vital opportunity to investment in medical innovation will lead to new advancements, support continued economic growth in the medical research sector and strengthen our nation’s productive bioscience industry, and help ensure therefore maintain America’s leadership role in medical discovery. Policythat patients are at the center of these efforts. makers should take note that 90% of poll respondents believe investment in medical research can not only lead to new discoveries that benefit paAram Nerpouni is the president and CEO of BioEnterprise, a Cleveland-based tients, but also support high-paying jobs and boost the economy. business accelerator focused on the medical device, biotechnology and In Ohio, the innovation economy is supported substantially by the $3.2 health IT and services industries.

Web Talk Re: Effects of trauma center If the outcome is saving lives, then UH's addition of a Level 1 Trauma Center is a welcome one. Unfortunately, as is the case of modern medicine these days, the economics will dictate whether UH and MetroHealth both survive in the trauma service industry.

— kevin

Re: Democrats taking on Trump I believe it is time to flip around what Obama said to the Republicans after he was first elected: "It's time for the Democrats to sit in the back of the bus." — reallyoldfarts

Re: Browns moving training camp?

What a BS move from a pathetic organization. This possible move to Columbus just gives me another reason to ignore this joke of an organization. And how much tax money is going to be used to pay for that new facility? Northeast Ohio in one way or another will be funding this move. — Tomo Niko

THERE’S NO

BUSINESS &(/(%5$7,1* <281* 352)(66,21$/6 ,1 7+( &/(

LIKE YOUR BUSINESS. Vorys, Sater, Seymour and Pease is a full-service corporate law firm that works with all kinds of businesses to help them grow. We recognize that your business is unlike any other. And what a coincidence — because our law firm is unlike any other, too.

For more information, visit vorys.com.

Vorys, Sater, Seymour and Pease LLP 200 Public Square, Suite 1400, Cleveland, Ohio 44114 106 South Main Street, Suite 1100, Akron, Ohio 44308

5GCF[ VQ IGV GPICIGF" 9KUKV GPICIGENGXGNCPF EQO VQ NGCTP OQTG

Columbus

Washington

Cleveland

Cincinnati

Akron

Houston

Pittsburgh

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

Crain’s Newsmakers of the Year It was a year of triumph, heartbreak, confusion and optimism. In short, 2016 was a year of disruption.

Doing business in Northeast Ohio changed dramatically over the last year. Cleveland’s success hosting the Republican National Convention reinvigorated the quest to bring more tourism dollars into the region. Developers are throwing millions of dollars into downtown projects that could reshape Cleveland’s core. New leadership at some of Northeast Ohio’s hallmark institutions has the potential, if it hasn’t already, to alter their futures. And, of course, Cleveland’s 52-year championship drought came to an end when a native son delivered on a promise.

These stories, Pages 13-20

LeBron James Ken Blaze for Crain’s

By KEVIN KLEPS

TIMELINE:

kkleps@crain.com @KevinKleps

Jan. 22: James is saddled with much of the blame after the Cavs fire head coach David Blatt, despite a 30-11 record that is the best in the Eastern Conference.

March 21: James creates quite a stir when he unfollows the Cavs on Twitter and Instagram.

James made the move “as part of his process to prepare for the playoffs.”

June 12: Upset with Draymond Green’s one-game suspension, Klay Thompson questions James’ manhood. A day later in Game 5, James responds with a dominant 41-point performance.

June 19: James has a triple-double (27 points, 11 rebounds and 11 assists) in the win over the Warriors in Game 7.

Aug. 11: James, for the first time since he returned in the summer of 2014, agrees to sign a multi-year deal with the Cavs. He ultimately signs a three-year, $100 million contract that includes a player option in the third season and a $31 million salary (the highest in the league) for 2016-17.

No one felt Cleveland’s 52-year, 146-season, 18,802-day major sports championship drought more than LeBron James.

When it finally ended, via the best comeback in NBA history, James collapsed to the floor at Oracle Arena in tears. After he had composed himself, his postgame interview produced a sound bite — “Cleeeeveland, this is for you!” — that is almost as iconic as his block of Andre Iguodala late in the Cavs' Game 7 win over the Golden State Warriors.

A lot can change in six years. In James’ case, almost everything did — from the fans’ feelings toward him, to the Cavs’ fortunes and even the national perception of the city in which they play.

The Decision has been replaced by The Block.

And anger is now near-universal love for a player who, remarkably, has gotten better with age — 13plus seasons and more than 47,000 combined regular-season and playoff minutes into a career that might be rivaled only by Michael Jordan.

It seemed only fitting that James’ third title, but the first in the region in which he grew up, occurred during a topsy-turvy season in which the Cavs fired their coach, the superstar’s happiness (or lack thereof ) was a constant subject of discussion, and the NBA Finals opponent was a team that set an all-time wins record during the regular season.

In claiming that elusive title, the Cavs became the first team to rally from a 3-1 deficit in the NBA Finals. Their wins in Games 5, 6 and 7 handed the Golden State Warriors their first three-game losing streak in 31 months, and two of the victories were at Oracle, where the Warriors were 50-3 prior to Game 5.

“This is what I came back for,” James said after Game 7. “It doesn’t feel real.”

For the series, James averaged 29.7 points, 11.3 rebounds and 8.9 assists per game. He joined some elite company — Michael Jordan, Magic Johnson, Shaquille O'Neal and Tim Duncan — in being named NBA Finals MVP for the third time.

“He was like, ‘I’m going to come back home because I promised them that I would do something.’

And he carried us the whole way,” Cavs forward Richard Jefferson told the media after the Cavs had clinched their first title.

Not surprisingly, things are going just as well for James off the court.

He has a lifetime deal with Nike that could be worth more than $1 billion, his SpringHill Entertainment is thriving (thanks in part to a content deal with Warner Bros.), and Klutch Sports — the agency run by business partner Rich Paul — secured Washington Wizards All-Star John Wall and No. 1 overall draft pick Ben Simmons as clients, and helped Cavs teammate J.R. Smith land a fouryear, $57 million contract.

More impressively, the LeBron James Family Foundation completed a year in which its Wheels for Education and Akron I PROMISE Network programs partnered with more than 1,000 elementary and middle-school students from 39 Akron Public Schools. By 2021, some of those students could attend the University of Akron on a full scholarship.

James often says he’s “just a kid from Akron.”

He’s proven to be so much more.

|

PA G E 13

PA G E 14

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

Crain’s Newsmakers of the Year

FirstEnergy

By DAN SHINGLER dshingler@crain.com @DanShingler

Whoever said that electric utility regulation is boring wasn’t anticipating the year that FirstEnergy just had.

True, in real time it might have been less than engrossing to anyone who is not an energy wonk. But, taken as a whole, FirstEnergy had a big-stakes year that went back and forth like a Big 10 classic. Even the theme was the same: Go bucks! Except this time the bucks were dollars, billions of them.

In the end, for 2016 at least, FirstEnergy got a few hundred million of the dollars it wanted, but it was a process that took two years and did not produce the results the company says it needs.

FirstEnergy CEO Chuck Jones said he was grateful for some subsidy relief, but it was not the amount the company was hoping for. FirstEnergy had asked for a subsidy of more than $550 million a year. It got $132.5 million.

Jones said the Public Utilities Commission of Ohio’s decision still left the company with a shortfall of about $200 million. Unless FirstEnergy can find that money elsewhere, its credit rating will suffer and it could ultimately become an acquisition target, Jones warns.

“There’s blood in the water,” Jones said in an October interview.

He added, “We’ve reduced benefits, we’ve reduced 401(k) matches, we froze wages. We’ve done a lot of things to try and offset lost revenue, but couldn’t offset it entirely … We’re evaluating everything we do as a company to try and find a way to close that gap. Because (what’s been

done so far) is not enough to get us into the position with the credit rating agencies that we need to be in.”

FirstEnergy got caught in a perfect storm, albeit one that was partially of its own making. The company was one of the loudest voices calling for Ohio to deregulate its electric power industry, which the state largely did between 1999 and 2005. But, while FirstEnergy’s older coal and nuclear plants fared well in a world in which natural gas was expensive and states like Ohio cared little about carbon or other pollution from coal, that world changed quickly.

It was natural gas that really hurt FirstEnergy’s market position. With the advent of shale drilling, natural gas suddenly became abundant and cheap, especially in Ohio where there have not been enough pipelines to move the stuff out of state.

Power companies love natural gas.

It comes in to their plant via a pipe, it burns cleaner and produces about half the carbon of coal — and gas doesn't leave behind tons of ash to store and manage, like coal does.

In Ohio, $6 billion has been invested or committed to seven new power plants since shale drilling began.

But FirstEnergy has not been able to react as quickly as some competitors. It’s already heavily invested in its existing coal and nuclear plants and can’t just quickly turn them off and replace them with new plants that can cost a billion dollars or more.

It’s a regulatory Gordian Knot in search of an Alexander.

FirstEnergy has an argument that makes sense, as do its claims to support the state’s economy with the more than 2,000 jobs in Northeast Ohio alone and its $52 billion in assets

FirstEnergy got caught in a perfect storm, albeit one that was partially of its own making.

TIMELINE:

Dan Shingler

Jan. 6: FirstEnergy cancels two power auctions because it says it wants the PUCO to rule on its 2014 rate plan that includes a special “rider” critics say would cost ratepayers $4 billion over eight years.

Feb. 23: PJM, the operator of the electrical grid for Ohio and much of the northeastern U.S., joins power companies Dynegy, Excelon and others in opposing subsidies for FirstEnergy, saying they would quash market competition.

March 31: The PUCO approves FirstEnergy’s request for the rider, over the objections of many consumer groups.

April 27: The Federal Energy Regulatory Commission overrules the PUCO and says the FirstEnergy riders are not allowed.

July 22: FirstEnergy announces it will shut down or sell its coal fired plants in Oregon, Ohio, and Stratton, Ohio.

Oct. 12: PUCO approves a ratepayer subsidy for FirstEnergy, but for far lower per year the company had requested.

Nov. 8: FirstEnergy tells analysts it intends to largely exit the competitive power generation business and that it will sell or close its big coal and nuclear plants over the next 18 months.

that represent decades of investments in longterm generation.

It’s detractors also have valid points: Why should ratepayers pay the price for what is arguably a Jones lack of planning on the part of the company? After all, it was FirstEnergy and other companies like it that asked for the market to be competitive to begin with.

That impasse of conclusions led to the tumultuous year that FirstEnergy and the PUCO have had.

Ultimately, the PUCO gave FirstEnergy probably as much as regulators figured they could get away with under federal rules.

Now, the future is far from certain.

FirstEnergy hopes the PUCO will reconsider, but it’s not waiting. Jones told analysts recently that the company is moving ahead with plans to close its biggest power plants. Layoffs are also a possibility, and an acquisition is not out of the question, though Jones said he has no intentions to sell the company and has vowed he will not leave Ohio himself.

Overdose takes more lives than traffic accidents, suicide, and HIV combined.

OVERDOSE IS IMMINENT UNLESS YOU STOP “Luna Living’s treatment program for addiction combines evidence based standards of care with the added novel approach of NAD infusion therapy, which effectively neutralizes withdrawal symptoms to such a dramatic extent that most clients can be successfully managed as outpatients from Day 1 of their enrollment in the program.”

Dariush Saghafi, MD Chief Neurologist - Parma Neurology Director - Headache Clinic - VA Medical Center

A Comforting Ambience Non-judgmental Acceptance A Sustainable Lifestyle

/XQD/LYLQJ Alcohol and Drug Recovery Center

440-703-0940 www.lunaliving.org

CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E 15

Crainâ&#x20AC;&#x2122;s Newsmakers of the Year

Northeast Ohioâ&#x20AC;&#x2122;s banking sector

By JEREMY NOBILE

TIMELINE:

jnobile@crain.com @JeremyNobile

Jan. 26: Huntington Bancshares Inc. announces its acquisition of FirstMerit Corp., a $3.4 billion deal with cost savings of 40% of FirstMeritâ&#x20AC;&#x2122;s expense base.

Jan. 31: Huntington eyes the largest market share in the state. However, data in the fall would show that Huntington is actually No. 2 in Ohioâ&#x20AC;&#x2122;s overall deposit market.

March 20: Company filings shed light on how Huntington, FirstMerit deal came together.

July 29: KeyCorp closes the acquisition of First Niagara Financial Group, a $4.1 billion deal announced in late 2015.

Aug. 14: Experts see the regional banking market as ripe with volatility following sizable mergers.

Aug. 16: Huntington closes its acquisition of FirstMerit.

Dec. 4: Northeast Ohio bankers show optimism for regulatory relief under a Trump administration.

From a couple of big mergers to a president-elect who touted bank deregulation during his campaign, developments in the banking sector in 2016 are harbingers of how Northeast Ohioâ&#x20AC;&#x2122;s banking landscape could further evolve in the coming year.

For starters, FirstMerit Bank is effectively no more.

A former top-three bank in Northeast Ohio, and the only regional bank to have called Akron home, FirstMeritâ&#x20AC;&#x2122;s merger into Huntington Bancshares Inc. eliminates a significant competitor here while positioning the bank for accelerated growth in Cleveland and Akron â&#x20AC;&#x201D; and elsewhere in its footprint, for that matter â&#x20AC;&#x201D; unlike ever before.

The $3.4 billion deal instantly gave Huntington dominant deposit market control in Akron while simultaneously elevating it as the second-largest deposit holder in Cleveland, trailing only KeyBank.

That visibility alone is enough to further challenge the regionâ&#x20AC;&#x2122;s other largest competitors: KeyBank, PNC Bank, Citizens Bank, JPMorgan Chase & Co. and Fifth Third Bank.

With a squad of legacy Akron and Cleveland bankers on its team courtesy of the FirstMerit combination, Huntington is poised to hit the ground running in 2017 by leveraging local connections to expand commercial business in a market the bank is already quite familiar with. Cleveland, after all, features the second-largest conglomeration of Huntington executives outside its native Columbus.

So while one competitor, FirstMerit, has exited an already tight and fragmented market, the benefits to Huntington mean competition will only get stiffer for the largest companies here.

Of course, KeyCorp saw its own sizable acquisition come together in 2016 with the $4.1 billion purchase of First Niagara Financial Group. That provides enough scale to establish KeyBank as the 13th-largest commercial bank headquartered in the United States, at $135 billion in total assets.

While not as immediately impactful to this market in the same way as the FirstMerit deal, it significantly empowers Key through an expanded footprint â&#x20AC;&#x201D; now crossing 15 states â&#x20AC;&#x201D; and a deeper pool of resources. It raises additional awareness of the Key brand, adds new products and accelerates the companyâ&#x20AC;&#x2122;s return to the mortgage business.

So in Northeast Ohio, eyes are on KeyBank and Huntington Bank as the top players in a tight field.

For smaller, community banks, 2017 could be a year of opportunity.

No single community bank, of course, will have the dominant market presence of its larger competitors.

Yet, an analysis of deposit market shares shows that, as a block, community banks in Northeast Ohio actually gained a little ground in 2016, indicating that smaller banks overall are still attracting customers.

As the marketâ&#x20AC;&#x2122;s biggest banks grow larger, the feel of a smaller financial institution could appeal to local companies. That personal touch and hometown feel undoubtedly will be part of community bankersâ&#x20AC;&#x2122; pitches to customers in the coming year.

Couple those opportunities with a growing local economy and the potential for bank deregulation under a

Trump administration, and itâ&#x20AC;&#x2122;s no surprise smaller banks here are feeling more optimistic about doing business in 2017 than they have in years.

Regulations have been squeezing bank margins by putting more costs on compliance and restricting lending efforts â&#x20AC;&#x201D; of course, the purpose of those regulations have been to stymie the habits that contributed to the last economic recession.

Yet, those regulations, which were passed with so-called â&#x20AC;&#x153;too-big-to-failâ&#x20AC;? banks in lawmakersâ&#x20AC;&#x2122; crosshairs, seem to have had a lopsided effect on smaller institutions that donâ&#x20AC;&#x2122;t have the same depth of resources to deal with them.

Those pressures have helped drive an industry consolidation in Ohio where bank charters have dropped 16% since 2011 despite community banks as a whole seeing profits grow â&#x20AC;&#x201D; something experts generally attribute to bankers figuring out the landscape.

With a looser grip on how they do business, though, banks could potentially see a new wave of growth in the coming years.

Thereâ&#x20AC;&#x2122;s a lot of positive momentum in the banking scene heading into the new year that, along with optimism for a friendlier banking climate and opportunities to capture new business, means competition will only be tighter in 2017.

THEREâ&#x20AC;&#x2122; S ONLY ONE THING TO DO WITH A CROOK E D S TOCK BROK E R .

S T R A IGH T E N HIM OU T. At Meyer Wilson, weâ&#x20AC;&#x2122;ve been successfully representing individual investors against their brokerage UPV IRU PRUH WKDQ \HDUV :HČ&#x2021;YH GRQH LW ORFDOO\ :HČ&#x2021;YH GRQH LW QDWLRQDOO\ $QG ZHČ&#x2021;YH EXLOW RXU UHSXWDWLRQ RQ RXU VXFFHVV 6R LI \RX NQRZ RI D VWRFNEURNHU ZKR LV FURRNHG QHJOLJHQW RU MXVW SODLQ QRW VPDUW HQRXJK WR GR WKH ULJKW WKLQJ FDOO XV :H FDQ KHOS

*HW ZKDWČ&#x2021;V FRPLQJ WR \RX

Meyer Wilson Co., LPA

MW_CrainsCleve_8.125x10_Straighten_FA.indd 1

Cleveland

Columbus

Los Angeles

216.600.1355

investorclaims.com

1/27/16 9:40 AM

PA G E 16

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

Crain’s Newsmakers of the Year

Changing face of C-suites

By SCOTT SUTTELL

TIMELINE:

ssuttell@crain.com @ssuttell

June 16, 2015: Craig Arnold is announced as the next CEO of Eaton Corp., replacing Alexander “Sandy” Cutler, who will retire on May 31, 2016. Arnold, a 15-year Eaton veteran, had been vice chairman, president and chief operating officer of Eaton’s Industrial Sector since 2009.

May 13: Mayfield Village-based insurance giant Progressive Corp. announces that president and CEO Glenn Renwick will retire July 1 after more than 15 years as chief executive. Tricia Griffith, 51, the company’s personal lines chief operating officer, is named to succeed Renwick as president and CEO on July 1 and will join Progressive’s board of directors at that time.

June 1: Arnold officially takes over as CEO of Eaton.

July 1: Griffith becomes CEO of Progressive.

Nov. 7: Omnova Solutions Inc. announces that Anne P. Noonan, 53, will become the specialty chemicals and polymer company’s president and CEO upon the Dec. 1 exit of chairman, president and CEO Kevin M. McMullen, 56. Noonan also is named to the company’s board of directors, though Omnova chose to split the chairman and CEO roles, naming William R. Seelbach, 68, as non-executive chairman.

Dec. 1: Noonan officially becomes CEO of Omnova.

An exclusive Northeast Ohio club — the ranks of public company CEOs — got a bit more diverse in 2016 with leadership transitions at three regional stalwarts: Eaton, Progressive Corp. and Omnova Solutions Inc. On June 1, Craig Arnold became chairman and CEO of Eaton, the giant power management company with its U.S. headquarters in Beachwood. (It's technically based in Dublin, Ireland.) He replaced longtime CEO Alexander M. “Sandy” Cutler, who had reached Eaton’s mandatory retirement age of 65. With his elevation to the top job, Arnold — a 16year Eaton veteran — became the only black CEO of a Northeast Ohio public company.

Eaton is an especially prominent player, since it's the largest public company in Northeast Ohio. It had a market capitalization of nearly $29 billion as of April 30, 2016, the date of Crain's most recent rankings of public companies.

Trade publication IndustryWeek noted that Arnold joined "just a handful of black CEOs of large manufacturing companies." At the time he became CEO, there were three black CEOs of Fortune 500 companies: Ursula Burns of Xerox Corp. and Kenneth C. Frazier of Merck & Co., both of which are manufacturers, and Kenneth I. Chenault of American Express.

On July 1, a month after Arnold took over formally at Eaton, Mayfield Village-based insurer Progres-

Tricia Griffith took over as president and CEO of insurance giant Progressive Corp. on July 1. (Contributed photo)

Craig Arnold replaced Alexander “Sandy” Cutler as CEO of Eaton Corp. (Contributed photo)

Anne P. Noonan became CEO of Omnova on Dec. 1. (Contributed photo)

What’s Your Competitive Advantage?

In business today, often the only advantage over your competition is the talented people who work for you. At Nesco Resource, we put over 60 years of experience into our work with companies to understand their needs and find the right talent to meet their goals.

From tech startups to industrial giants, we’re matching talent with opportunity to grow business. And with some of the highest satisfaction ratings in the industry, Nesco Resource is working for both the companies and talent we serve.

Let Nesco Work For You www.nescoresource.com/works

A Nesco, Inc. Company

Nesco Resource is a wholly owned subsidiary of Nesco Inc., a privately held diversified holding company focused on sectors including manufacturing, human resource services, and real estate.

sive installed Tricia Griffith, 51, formerly the company's personal lines chief operating officer, to succeed Glenn Renwick as president and CEO. In May, when Progressive announced the CEO transition, Credit Suisse analyst Ryan Tunis told The Wall Street Journal that Griffith was the “ideal candidate” to fill the CEO seat as Progressive makes a big push to sell more home insurance along with its auto coverage. He wrote in a note to clients that Progressive "faces several aspects of uncertainty in the next year as it transitions into a multi-line company,” but that Griffith was “very heavily involved” in building out the strategy related to the home-insurance push.

Progressive is another heavy-hitter in Northeast Ohio's corporate scene, ranking as the third-largest company in the region, with a market cap just north of $19 billion as of April 30.

With the additions of Arnold and Griffith to the CEO roster in Northeast Ohio, and the continued tenure of KeyCorp chairman and CEO Beth Mooney, three of the eight largest companies in the region are led by a woman or a minority. (Key was No. 8 in market cap as of April 30, at $10.4 billion.)

The ranks of female public company CEOs grew even more on Dec. 1 when Anne P. Noonan took over as CEO of Omnova, the Beachwood-based specialty chemicals and polymer company, replacing Kevin McMullen.

Before taking the top spot, Noonan, who joined Omnova in 2014, was president of the company's Performance Chemicals business. She worked at Chemtura Corp. and its predecessor, Great Lakes Chemical Corp., for 27 years.

Of the 56 public companies in Northeast Ohio, four now are headed by women: Griffith at Progressive; Mooney at KeyCorp; Jenniffer Deckard at Fairmount Santrol Holdings Inc., a Chesterland-based provider of high-performance sand and sand-based products that's No. 28 on the market cap list, at $645 million; and Noonan at Omnova, No. 36 on the list with a market cap of $322 million.

The 2016 CEO transitions were years in the making and reflected a commitment to inclusive search processes that looked everywhere — not just the traditional places — for leaders with strong skill sets and track records.

It's likely a harbinger of the future as corporations seek talent in an increasingly diverse workforce

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E 17

Crain’s Newsmakers of the Year

Sherwin-Williams Co.

By RACHEL ABBEY McCAFFERTY

TIMELINE:

rmcafferty@crain.com @ramccafferty

Jan. 1: John G. Morikis takes over as CEO. March 20: Sherwin-Williams announces plan to purchase rival Valspar Corp.

May 12: Morikis Sherwin-Williams and Valspar announce that they had received requests for more information about the merger from the Federal Trade Commission.

Oct. 30: Sherwin-Williams and Valspar reject rumors that the FTC is concerned about the merger.

Nov. 7: Christopher M. Connor, the company’s former CEO, announces intention to retire as executive chairman at the end of 2016.

One of the biggest changes at Sherwin-Williams Co. this year was actually announced in 2015.

Back in October 2015, the paint giant announced that CEO Christopher M. Connor was relinquishing that title after 16 years and that, effective Jan. 1, 2016, John G. Morikis would take over.

Morikis is just the ninth CEO in Sherwin-Williams’ 150-year history.

Morikis, now president and CEO, could be used as the definition of an employee who climbed the ladder to success. He joined Sherwin-Williams back in 1984 as a management trainee; in 2006, he became the company’s president and chief operating officer.

Morikis had been in his new role for less than three months when Sherwin-Williams announced that it had agreed to buy Minneapolis-based rival Valspar Corp. for about $11.3 billion, a move that would form a merged company based in Cleveland. Sherwin-Williams will pay $113 a share for Valspar.

This deal is the largest in the company’s history, though far from its first. Sherwin-Williams has said it’s been acquisitively growing over the past decade, having acquired 21 businesses during that timeframe.

But this most recent acquisition, once completed, could make Sher-

Christopher M. Connor will retire at the end of 2016. (Contributed photo)

win-Williams the largest coatings manufacturer in the world.

According to data provided by Sherwin-Williams, in 2015, the combined companies’ sales would have equaled $15.6 billion, comfortably higher than the sales it cited for PPG Industries Inc. of $14.2 billion or AkzoNobel of $11.1 billion that year (both those figures exclude the competitors’ non-coatings segments).

And though the cost is significant, Sherwin-Williams sees the potential for cost savings by combining the two companies — and it expects the acquisition to be immediately accretive to earnings, barring one-time costs.

But the pure financial benefits are far from the only ones the company highlighted. For example, the acquisition will expand Sherwin-Williams’ reach across the globe, especially in the Asia-Pacific region and what’s known as the EMEA region in Europe, the Middle East and Africa. Before the acquisition, about 16% of the company’s revenue came from outside the United States. Once the acquisition is completed, that share will rise to 24%.

Combining the companies will also allow Sherwin-Williams to enter two new markets: food and beverage packaging coatings and steel coil coatings. In fiscal year 2015, Valspar

had sales of $2.5 billion from its coatings segment, which includes both of those markets. Its paint segment had sales of $1.7 billion.

And the acquisition would further strengthen the company’s portfolio, giving it more well-known brands and products to offer customers, and boost the technology available at its disposal.

Overall, the acquisition, once completed, would make Sherwin-Williams even more of a paint powerhouse and will give it a solid

platform from which to grow.

But it hasn’t been all smooth sailing. In May, the companies announced that the Federal Trade Commission had requested more information from them on the acquisition. And, if the New York Post is right, there are concerns. In late October, the paper reported that the FTC had rejected some concessions Sherwin-Williams had offered. Sherwin-Williams and Valspar quickly released a statement calling the rumors “unfounded” and reiterating that the two expect few, if any, divestitures to be necessary. If they are, there are measures in the agreement to adjust the price. If divestitures are necessary of businesses of more than $650 million in Valspar’s 2015 revenue, the transaction price would lower to $105 per share. Sherwin-Williams could also stop the transaction if divestitures equaled more than $1.5 billion in 2015 revenue.

The deal is expected to close in the first quarter of 2017.

In the meantime, more internal changes are underway. Connor, who stayed on at Sherwin-Williams as executive chairman, is retiring from that role at the end of the year, but will stay on the board until the company’s 2017 annual meeting. That means Morikis, after finishing up a particularly high-profile first year as CEO, will add the role of chairman to his title, effective Jan. 1, 2017.

ACCOUNTANTS + BUSINESS ADVISORS

KPFF is becoming a part of Apple Growth Partners.

For over 50 years, KPFF has been a recognized leader in providing the highest quality accounting and consulting services to our clients. As we continue to grow, KPFF is becoming part of Northeast Ohio-based Apple Growth Partners.

AGP shares our mission to provide services and creative solutions that deliver healthy, sustainable growth for our clients, and we are excited to grow together.

We look forward to delivering our expanded services to our trusted clients.

Akron 1540 West Market St. Akron, Ohio 44313 P 330.867.7350 F 330.867.8866

Cleveland 6155 Rockside Rd., Suite 400 Cleveland, Ohio 44131 P 216.674.3800 F 216.674.3801

Beachwood 24500 Chagrin Blvd., Suite 315 Beachwood, Ohio 44122 P 216.292.6120 F 216.292.5718

PA G E 18

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

Crain’s Newsmakers of the Year

By TIMOTHY MAGAW tmagaw@crain.com @timmagaw

Last July, when the Donald Trump roadshow came to Cleveland for his official party christening, several establishment Republicans were absent from the convention hall.

Ohio Gov. John Kasich’s was perhaps the most glaring given that it was he who carried the state in the bruising Republican primary. After a long-fought primary where he tried to position himself as the adult in the room, Kasich’s even-keeled rhetoric was overshadowed by the bombastic businessman who will take office in January. There had even been talk of delegates lining up behind Kasich, spoiling Trump of the nomination he had earned.

During the convention, Kasich remained on the perimeter, quietly drumming up support for what would surely be a 2020 run to take on Hillary Clinton who, according to the polling, was certainly bound for the Oval Office. Back in April, Kasich gave a speech that, without naming Trump directly, described a “path to darkness” alongside the more positive, optimistic approach the Ohio governor promoted.

“Some who feed off of the fears and anger that is felt by some of us and exploit it feed their own insatiable desire for fame or attention,” Kasich said in the speech. “That could drive America down into a ditch, not make us great again.”

So much uncertainty continues to swirl around the Trump presidency, but one thing is for almost certain: Kasich’s long-held presidential aspirations are dead.

Since he soundly defeated Ed FitzGerald in his re-election bid, the governor, it seems, has been running for president. So, 2016 couldn’t have been more of a letdown. Once he was

John Kasich TIMELINE: March 15: Kasich wins the Ohio primary election. It would be his only victory during the campaign.

May 4: Kasich suspends his presidential campaign. He took no questions from reporters, did not mention Trump or any other candidate by name, and did not address political matters going forward.

July 18: Paul Manafort, Trump’s campaign manager at the time, describes Kasich as “petulant” and “embarrassing his party in Ohio” by refusing to back Trump.

Sept. 16: President Barack Obama recruits Kasich to be part of a bipartisan group to tout his struggling Trans-Pacific Partnership trade deal with Asia.

Dec. 5: Kasich warns lawmakers Ohio is “on the verge of a recession” as state tax revenues continue to dwindle.

John Kasich speaks during a town hall event in Brooklyn, New York during his unsuccessful presidential bid. (John Taggart/Bloomberg)

out of the race, he refused to endorse the Republican nominee — a move that resulted in him being chastised

by Trump and other Republicans, including party chairman Reince Priebus, for reneging on his pledge to support the party’s nominee. Kasich’s refusal to back Trump during the election could portend a frosty relationship between Ohio and the Trump administration.

Complicating matters further, Ohio GOP chairman Matt Borges — a strong Kasich ally — could lose his party leadership post early next year to a more Trump-friendly challenger.

Once Trump locked up the election, Kasich did ultimately soften his tone, congratulating the president-elect. He also canceled a speech he planned to give days after the election on the future of the GOP.

That future, it was clear, likely wasn’t going to include him.

“The American people have spoken and it’s time to come together.

Congratulations President-elect @ realDonaldTrump,” Kasich wrote on Twitter.

But with two years left on his term, it’s time for Kasich to put his focus back on Ohio rather than his own ambitions. Earlier this month, he

warned lawmakers that Ohio was “on the verge of a recession” because the state’s tax revenue continue to fall short. As a result, the next state budget is expected to be leaner than usual. And given that he’s in the waning years of his term and has continually touted his track record of shoring up Ohio’s finances, how he handles this potential crisis could very well determine his legacy.

David Gilbert TIMELINE:

By JAY MILLER

Feb. 14: Gilbert named Executive of the Year by the SME Cleveland for his leadership of Destination Cleveland, the Greater Cleveland Sports Commission and the 2016 Republican National Convention Host Committee.

April 8: With the convention 100 days away, Gilbert reports that the host committee has pledges for $55.5 million of the $64 million required to put on the convention. After the convention concluded he would report that the goal had been topped.

June 10: The city hosts the Donate Life Transplant Games wooed by the sports commission Gilbert leads.

July 18: The Republican National Convention kicks off with Gilbert calling the two years of preparation like “planning for a wedding.”

Aug. 16: At a Crain’s-sponsored forum recapping the convention Gilbert calls the smoothly run event — and the Cavaliers championship in June — catalysts for a rebirth of the city. “We’ve been held back for decades by our own lack of self-confidence,” he said. “We now have a new normal.”

Oct. 28: Forbes calls Cleveland “America’s Hottest City Right Now.”

jmiller@crain.com @millerjh

As 2016 was about to roll in, David Gilbert spoke with Crain’s Cleveland Business about the state of Cleveland’s planning for the upcoming Republican National Convention. Gilbert was president and CEO of the Cleveland 2016 Host Committee, the group charged with preparing the city of Cleveland for the four-day political summit coming in July.

“There are very few things that we can say, ‘Hey, we’ve gotten it done, check the box and we’re on to the next thing,’” he said.

“You can get largely the way there, but most of these things don’t end until the convention happens.”

Gilbert took on the host committee job in addition to his day job as president and CEO of Destination Cleveland, the regional convention and visitors bureau. His Destination Cleveland staff also did double duty.

Six months later, anxiously waiting for the festivities to get underway, Gilbert looked back on that planning process, as the Republicans and media were about to descend on Cleveland and told Crain’s that planning for the event was “like planning an indoor wedding and an outdoor wedding.”

While it may be possible to compare convention planning to wedding plan-

ning, the comparison would end there unless you’re willing to go out on a limb and call both life-changing events.

That may be apt since Gilbert and other civic leaders who had spent years working to bring a political convention to the city actually had a life-changing outcome in mind for the marriage of Cleveland and the Republicans.

In April 2014, just after the city had been awarded the convention, Gilbert said many people “have a visceral (negative) reaction to the word ‘Cleveland.’ So before we can go out and promote our arts, sports, restaurants or great outdoors, we have to first change what they think of as Cleveland.”

Gilbert hoped that when they weren’t focused on the convention stage, the reporters, broadcasters and tweeters from around the world who would come to Cleveland would turn their attention to the refurbished Public Square and the new residential community growing up around it and the prospering medical centers and biotechnical businesses stretching from downtown east to the spiffed up cultural centers at University Circle.

It would be a chance to douse the memory of burning-river Cleveland with a wildly successful performance on an international stage.

It didn’t hurt that Gilbert had a little help from the Cleveland Cavaliers,

who added a flourish, an NBA championship, to the script.

When it was all over, at a Crain’s sponsored civic forum in August titled, “Life after the RNC: What’s Next?” Gilbert said even residents were seeing the city differently.

“I think the biggest change (is that a) switch has finally flipped and Clevelanders are believing in their own town,” said Gilbert. “The combination of those two, the convention and the sports championship, could not have meant more to any city.

They were such catalysts,” Gilbert said. “We’ve been held back for decades by our own lack of self-confidence. We now have a new normal.”

It appears that others are noticing Gilbert’s “new normal.” Fortune.com reported as the convention was ending that “(T)here does seem to be one thing that all of the delegates (and even media members) seem to agree on: Cleveland has been a fantastic host city. Cleveland’s walkability, cleanliness, friendliness and even its weather have drawn nothing but rave reviews.”

More recently, in September, TimeOut United States, an online and print “where to go” publisher, said this when it included Cleveland in a feature headlined, “The 15 Best Places to Live in the U.S.”: With median house prices around $60,000, Cleveland is significantly more affordable than many other eastern cities, yet it feels like a boom town, with a revived downtown, new hotels, and an exploding food scene.

And then there was the website of AARP, the organization for the 50+ crowd. In November it post an article titled, “10 Great Places to Live on Less Than $40K,” and said this about Cleveland: “With its varied neighborhoods, world-class orchestra, thriving downtown, elite medical centers, miles of biking and hiking trails along Lake Erie and — finally!— championship sports teams (thanks, LeBron), this Rust Belt city is staging a mighty comeback.”

That kind of glowing affirmation was exactly what Gilbert, the man in charge of bringing tourists and conventioneers to the city, was looking for.

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E 19

Crain’s Newsmakers of the Year

By STAN BULLARD sbullard@crain.com @CrainRltyWriter

Downtown Cleveland was ready for its close-up when global media attention gripped the city with three major events, from the Republican National Convention, the NBA championship by the Cleveland Cavaliers and the World Series cliffhanger loss by the Indians.

Multiple new projects opened their doors in the city in the run-up to the political convention, but they built on real estate developments that have spanned decades remaking downtown Cleveland.

Meantime, new owners took control, or prepared to take control, of major properties that will be retooled in new visions.

Opening of the greener, friendlier Public Square in June after a $50 million renovation did much to reflect the change in downtown from simply an office center to a place to live and play.

While intended to give the city a new front door prior to the RNC in July, the softening of the onetime village green further propelled changes around it. The rejuvenated public space makes the area more attractive for additional residential development, primarily with the purchase of Terminal Tower by K&D Group of Willoughby from Forest City Realty Trust Inc. for partial conversion to almost 300 dwelling places in the iconic office building.

On the opposite side of the square, potential sales may add to the redevelopment. The 55 Public Square skyscraper went on the market, seen primarily as a potential redevelopment play to apartments, and 75 Public Square is expected to be sold for hotel use as owner Millennia Cos. said it will drop apartment plans there in order to focus on its anticipated purchase of Key Center on Public Square, in part as a new home for the Valley View company’s suburban work force.

The most high-profile addition to the growing number of downtown apartments was at the Schofield Building, where 51 apartments opened in a restored 1890-vintage building.

While downtown Cleveland’s increasing residential population is trans-

Downtown’s rebirth TIMELINE: March 8: Schofield Kimpton Hotel and Residences opens, 2000 E. Ninth St. March 23: Affiliates of Dan Gilbert buy The Avenue at Tower City Center.

June 1: Hilton Downtown Cleveland at Huntington Convention Center opens, 100 Lakeside Ave. June 23: Drury Plaza Hotel opens, 1380 E. Sixth St. June 30: A green, people-friendly Public Square opens after a $50 million renovation.

Sept. 15: Forest City sells Terminal Tower to K&D Group.

Dec. TBD: Columbia Property Trust expects to close sale of Key Center, which incorporates Ohio’s tallest skyscraper and two other buildings. Valley View-based Millennia Cos. says it’s the prospective buyer.

The Terminal Tower and the Soldiers and Sailors Monument viewed from the revamped Public Square. (David Kordalski)

forming it, the effort to reestablish the city as a convention destination and build on growing leisure visitors shifted into overtime in 2016. The opening of the 600-room Hilton Cleveland Downtown in June had cemented the city’s bid for the RNC, but it is primarily designed to enhance the city’s ability to compete for multiple-day conventions that demand such direct access.

However, in typical Cleveland fashion, another 300 rooms went onto the market between the Kimpton Schofield Hotel, 2000 E. Ninth St., and Drury Plaza Hotel, 1380 E. Sixth St. Along with three other hotels opened in the past few years, the city has hotel rooms available for more

conventions than in decades. If the city does not win those much-sought prizes in big numbers, hoteliers will be forced to compete for the relatively stable bookings provided by local businesses and dropping rates to snare more leisure visitors.

The visitors will help support the never-ending parade of new downtown dining spots and the quest for additional downtown retail. Although 2015 saw significant additions of new retailers such as Heinen’s downtown, most activity in 2016 was in the food category.

However, telling developments took place in the city’s long-suffering downtown malls.

Most significantly, the sale by Forest City Realty Trust of The Avenue at Tower City in March to affiliates of Cavaliers owner Dan Gilbert’s Bedrock Real Estate Services of Detroit for the first time puts a new owner in control of the downtown mall that was the centerpiece of Forest City’s creation of Tower City Center a generation ago. Now Gilbert affiliates own most of Tower City Center with The Avenue, the Ritz-Carlton Hotel and office building, and the Higbee Building, which includes office space as well as Gilbert’s Jack Cleveland Casino. However, Bedrock has not publicly shared ideas for how it will revitalize the center.

A third of the other troubled downtown mall, the Galleria, became home to the Parker Hannifin Downtown Cleveland YMCA fitness center, providing an amenity for downtown workers and the emerging downtown population in the empty selling space.

For a year focused on visitors and new residents, downtown also benefited from the amenities helping attract new office tenants. More than 500 additional workers came from just two deals — New York Life’s move to 200 Public Square from Lakewood and IBM’s leasing the top three floors of 1111 Superior Ave., for newly purchased companies.

university behind — in June, the university shared that he was going to exercise the option in his contract to become a professor — much of his legacy was quickly unraveled.

For example, the university had started distancing itself from the “polytechnic” tag near the beginning of the year. By mid-May, it had started to disappear from the university’s website and social media accounts.

Now? It’s hard to find, outside of archives.

And the leaders Scarborough had brought on board began to leave the University of Akron in short order after his resignation was announced.

That includes Lawrence J. Burns, who had been brought on as the university’s vice president of advancement, as well as the leaders of two centers Scarborough had founded: Mario R. Garzia, executive director of the Center for Data Science, Analytics and Information Technology, and Jeff Hoffman, founding director of the Experiential Learning Center for Entrepreneurship and Civic Engage-

ment. The data science center is now being run with faculty; the EXL Center, as it’s known, has a pair of new co-directors, but is running with fewer resources than before.

Now, it’s up to Matthew J. Wilson to right the ship. Wilson joined the university in 2014 as dean of its law school and quickly gained attention by implementing innovative programs and helping increase enrollment. The board named him interim president of the university in July 2016 and, about three months later, officially made him president.

He’s been tasked with a variety of responsibilities, from creating a maintainable budget to increasing student enrollment and retention.

But much of Wilson’s work will have to focus on regaining the trust of the community and rebuilding the university’s reputation after the contentious past two years. That may be a good fit for Wilson, who has made it clear it’s important to him that the university’s students feel supported.

Scott L. Scarborough TIMELINE:

By RACHEL ABBEY McCAFFERTY rmcafferty@crain.com @ramccafferty

Scott L. Scarborough may not be at the helm of the University of Akron anymore, but his stint as president likely will reverberate through the school’s decisions in the years to come.

Scarborough took on the role of president at the University of Akron in July of 2014, and his financial background was seen as a particular plus for a school saddled with a significant amount of debt. But the next two years were rocky ones for the university.

In May 2015, Scarborough announced that the university was rebranding itself as “Ohio’s polytechnic university.” It wasn’t the name change many had been expecting, but it still wasn’t well received. In July of that year, the university announced $40 million in budget cuts, including more than 200 non-faculty jobs. Later that summer, the details of an extensive and expensive renovation to

the president’s house were revealed, which also was met with consternation from the community — particularly concerning the cost of a now-infamous decorative olive jar.

The beginning of 2016 seemed to bring fewer headline-driving changes, but the university’s troubles continued. Its Faculty Senate passed a no-confidence resolution in February, indicating its lack of faith in Scarborough’s ability to lead. Total giving fell, as did enrollment. The University of Akron is not alone among Ohio colleges in facing a declining student base, but its preliminary headcount

Feb. 4: Faculty Senate passes resolution of “no-confidence” in then-president Scott L. Scarborough.

May 31: Scarborough steps down as president.

July 6: Lawrence J. Burns, vice president of advancement, comes to an agreement to leave the university.

Burns is the first of many leaders hired by Scarborough to leave.

July 11: Matthew J. Wilson, the university’s law school dean, is named interim president.

Oct. 19: The university’s board of trustees votes to remove the “interim” part of Wilson’s title and officially name him president.

drop of about 8% from fall 2015 to fall 2016 was by far the sharpest among Ohio’s public main campuses.

In May, Scarborough and the university announced he was stepping down as president, less than two years after taking the role.

While he hasn’t entirely left the

PA G E 2 0

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

Crain’s Newsmakers of the Year

By KEVIN KLEPS kkleps@crain.com @KevinKleps

TIMELINE:

Terry Francona

When the Cleveland Indians hired Terry Francona as manager in October 2012, they were coming off a 68-94 season that was their fifth in a row without a winning record and their third in four years with more than 90 losses.

The self-deprecating manager won’t take much, or any, credit for what’s transpired since — four consecutive winning seasons, two postseason berths and a trip to the 2016 World Series — but there’s no doubt Francona is as valuable as any skipper in the game.

And the best performance of the 57-year-old manager’s career might have occurred during a season in which the Tribe fell one win short of its first championship in 68 years.

With standout outfielder Michael Brantley limited to 11 games by a shoulder injury and starting pitchers Carlos Carrasco and Danny Salazar lost to injuries during an eight-day span in September, the Indians made a remarkable postseason run. The Tribe won 10 of its first 12 playoff games — dominating the favored Boston Red Sox (Francona’s former team) and Toronto Blue Jays (led by Francona’s former Tribe boss, Mark Shapiro) in the first two rounds — and took a 3-1 lead on the Chicago Cubs before losing the last three games of the Fall Classic.

The finale, an 8-7 win by the Cubs in a 10-inning Game 7, was an instant classic that generated the best national rating (25.2) for a baseball broadcast since Game 7 of the 2001 World Series.

A lot of the credit for the Tribe’s scintillating postseason went to Francona, whose deft management of the club’s terrific bullpen short- Terry Francona led the Indians to 94 wins and an American League pennant in 2016. (Jason O. Watson/Getty) ened games and negated many of the 100 days in first place, racked up a fran- when we hired Tito, he’s gone be- dance numbers still languished disadvantages caused by injuries.

He was selected as the American chise-record 14-game winning streak yond that,” Chris Antonetti, the among the worst in MLB, but by late League’s Manager of the Year for the and improved Francona’s all-time Tribe’s president of baseball opera- October, the club had brought in 1,100 new full-season-ticket equivasecond time in four years with the In- playoff record to 38-23. Francona’s .623 tions, said after the season.

The Indians’ resurgence also lents and racked up 1,300 new seadians, and the Tribe’s 94-win regular winning percentage in the postseason season padded what looks like a Hall is the third-best among managers with sparked a renewed interest in base- son-ticket accounts — increases of 65% and 100%, respectively, from at least 25 career playoff games. of Fame résumé. ball in Northeast Ohio.

PAGEThe 22 2016 μ DECEMBER 2016 more μ CRAIN'S BUSINESS “As high as our expectations were Indians19,spent than CLEVELAND The Tribe’s regular-season atten- 2016.

REAL ESTATE

Phone: (216) 771-5276 Contact: Lynn Calcaterra E-mail: CLBClassified@crain.com

APARTMENTS

INDUSTRIAL SPACE FOR LEASE Industrial/Warehouse

July 1: The Indians set a club record by winning their 14th consecutive game with a 2-1, 19-inning victory at Toronto that lasted six hours and 13 minutes. The teams combined to use 19 pitchers.

Oct. 10: The Tribe defeated the Boston Red Sox 4-3 at Fenway Park to complete a three-game sweep and cement the Indians’ first trip to the American League Championship Series in nine years.

Oct. 19: Rookie Ryan Merritt and three relievers combined on the Tribe’s third shutout of the playoffs as the Indians ousted the Toronto Blue Jays in five games and advanced to their first World Series since 1997.

Nov. 2: The Indians rallied from a 5-1 deficit to tie Game 7 of the World Series on Rajai Davis’ two-out, two-run home run in the eighth inning, but fall to the Chicago Cubs in 10 innings.

Nov. 15: Francona receives 22 of 30 first-place votes to capture his second AL Manager of the Year honor since 2013.

The Indians’ online merchandise soared, Cleveland hotel revenues nearly doubled during the World Series, corporate jets abounded at Burke Lakefront Airport and Cleveland Hopkins International Airport during the playoffs, SportsTime Ohio’s regular-season TV ratings were the best in 11 years, and the average rating for the World Series in the Cleveland market topped the 2016 NBA Finals by 4.5 points (43.3 to 38.8).

Two days after the season ended, the Indians picked up two club options on Francona’s contract that extended his deal through the 2020 season. If he finishes out the deal, he will have managed the Tribe for nearly as long as Mike Hargrove, and another World Series trip would match Hargrove’s total in that category.

“A lot of the resiliency and the grit that we saw with this team is a product of that culture,” Tribe general manager Mike Chernoff said of the working environment created by a manager who has racked up 12 consecutive winning seasons.

CLASSIFIED Copy Deadline: Wednesdays @ 2:00 p.m.

All Ads Pre-Paid: Check or Credit Card BUSINESS SERVICES

THINKING OF SELLING? THINKING OF BUYING? It’s Stys Inc. Since 1962 CNC Machinery, Metal Working, Forklifts, L/P, Elect, Pallet Racking, We also do Liquidataion.

216-641-7897

FLYNN ENVIRONMENTAL UST REMOVALS • REMEDIATION DUE DILIGENCE INVESTIGATIONS

(800) 690-9409

C.W. JENNINGS INDUSTRIAL EXCHANGE Global Industrial Consulting Construction • Acquisitions Exporting • Financing (855) 707-1944

BUSINESS SERVICE OWNERS! 25,825 sq. ft, 20 ft. ceilings; Great freeway access and exposure in Painesville twp. $3.10 sq. ft. NNN

Call 440-922-6060

For daily on-lineupdates, sign up @ CrainsCleveland.com/Daily

Submit your business card to promote your service.

To find out more, contact Lynn Calcaterra at 216.771.5276

Send us your ad via e-mail... LCalcaterra@Crain.com

CRAIN’S CLEVELAND BUSINESS

PERSPECTUS CONTINUED FROM PAGE 9 Bill Ayars, the other managing principal of Perspectus, said that when a visitor enters Chambers, Murphy & Burge's office in Akron, the photos that line its walls and the books that line its shelves show that "this is a place that is devoted to preservation. We're thrilled to add historical architecture, preservation and adaptive reuse to our capabilities. Chambers, Murphy & Burge is one of the most highly regarded firms in their field, and we've enjoyed a longterm mutual respect."

The idea of a merger, Ayars said, emerged as the firms worked on assignments together the past few years.

Merging with another firm allows the specialized expertise in old buildings to be carried into the future, both Ayars and Murphy said.

Among Chambers, Murphy & Burge projects are work on restoration of Murphy Hall at John

Elizabeth Corbin Murphy, left, and Lawrence Fischer. Murphy became a principal of Perspectus as Chambers, Murphy & Burge merged with the Cleveland-area firm. (Contributed photo)

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E 21

Carroll University, preservation of the John Brown House in Akron, and the planned adaptive reuse of the Stuyvesant Building, 1937 Prospect Ave., as apartments. Stuyvesant is being undertaken by Woda Group, a Columbus-based real estate developer that also has projects in Marion and Lima that Chambers, Murphy & Burge are working on.

Joining Perspectus means that Chambers, Murphy & Burge will lose its status for government work as a female-owned firm, but Murphy said that it would not much of a loss because it has not greatly helped the firm in the past.

"I believe (economically disadvantaged) status is more helpful to construction contractors and subcontractors than it is to professional firms," Murphy said.

The acquisition lifts Perspectus into the five largest firms in the region, according to the Crain's Cleveland Business 2016 list of architecture firms, based on the number of registered architects.

Perspectus works nationally in health care, senior living, government, academic and retail markets.

ADVERTISING

Weatherhead Executive MBA Develop transformational leadership skills for immediate growth in your career and life. Now offering a healthcare track in affiliation with the Cleveland Clinic.

The space you need to learn.

The power you need to lead.

Learn more at weatherhead.case.edu/emba.

Crain’s People on the Move promotional feature showcases Northeast Ohio job changes, promotions and board appointments. Guaranteed placement in print, online and in a weekly e-newsletter can be purchased at www.crainscleveland.com/peopleonthemove.

FINANCIAL SERVICES

ACCOUNTING

CONSULTING Brenda S. Gainer, RHU, PHR, GBA Consultant, Health and Benefits Willis Towers Watson

Michael Bigrigg

Mark J. Nadaud, CPA/ABV

Senior Manager

Partner

Gabriel Partners

King Barrett LLP

Michael Bigrigg joined Gabriel Partners as a Senior Manager in the Valuation and Corporate Services practice. He previously served as a Manager in the valuation and litigation support practice of Corrigan Krause. Mr. Bigrrigg has 8 years of public accounting experience focused in business valuation, bringing valuable skills to assist the firm’s clients with complex financial issues such as financial and tax reporting, business succession planning, and economic damages analysis.

King Barrett LLP is proud to announce Mark J. Nadaud, CPA/ABV, as a partner at the firm. Mark specializes in practice transitions, valuations, business consulting, and accounting services for the dental industry (and other healthcare professions) located in Ohio and throughout the United States. Mark received a Masters in Accountancy from the University of Notre Dame and a Bachelor of Science in Finance and General Business from Miami University of Ohio.

CONSULTING Reba Allison-Mahanera

CONSULTING Benjamin Garrett

Director of Human Resources

National Director of Business Development

Richter Healthcare Consultants

Richter Healthcare Consultants

Jennifer Richter, President/CEO welcomes Reba Allison-Mahanera as the Director of Human Resources at Richter Healthcare Consultants. Reba will be responsible for recruitment, engagement and leadership development for all divisions and departments. Richter Healthcare Consultants is a professional firm offering clinical and financial consulting, accounting, revenue cycle management and remote corporate management solutions to Long Term Post-Acute Care providers nationwide.

Jennifer Richter, President/CEO welcomes Benjamin Garrett as the National Director of Business Development at Richter Healthcare Consultants. Ben will be responsible for engagingnew business opportunities and creating high value customized solutions.

Richter Healthcare Consultants is a professional firm offering clinical and financial consulting, accounting, revenue cycle management and remote corporate management solutions to Long Term Post-Acute Care providers nationwide.

Brenda has more than 25 years of experience working with Fortune 500 companies domestically and internationally in benefit program development and human resource management. She attended the University of Akron, University of Phoenix and the Howard Nicols School of Nursing. Brenda holds a certificate of nursing with the state of Ohio, the designations of Regional Health Underwriter, Group Benefits Advisor, Professional in Human Resource Management and Six Sigma Green Belt training.

STAFFING & SERVICES

NONPROFITS Daniel Mansoor Vice President Resource Development and Chief Philanthropy Officer United Way of Greater Cleveland Mansoor will develop and manage fundraising strategies to address changes to giving practices, increase donor engagement, recognition and retention and oversee marketing communications. He has 30 years experience serving in development roles at private universities Cornell and Brandeis and as founder of nonprofit consultancy GoodWorks. Mansoor has extensive experience with annual and major gifts, capital campaigns, planned giving and corporate and foundation relations.

NONPROFITS

Thomas M. Clark

Helen Forbes Fields

Vice President of Operations

Vice President of Community Impact and General Counsel

Direct Consulting Associates Tom Clark is VP of Operations for Direct Consulting Associates (DCA).

Tom oversees the daily operations and focuses on strategic planning and goal-setting to support the growth of DCA. His track record of success includes building and leading the Military and Supply Chain & Logistics Practices at sister company, Direct Recruiters, over the past 2 years.

Tom is a Supply Chain Services Management Officer Grad from US Army Quartermaster Center & School & holds a BSBA from John Carroll University.

United Way of Greater Cleveland Forbes Fields will oversee United Way’s program investments and the Community Impact agenda. Her role requires building and maintaining relationships with agencies, organizations, volunteers and donors to make a measurable difference in the quality of life for those in Greater Cleveland. Forbes Fields was previously a partner at Forbes, Fields & Associates Co. LPA. She received a B.A. in political science from Spelman College and law degree from Howard University School of Law.

For more information or questions regarding advertising in this section, please call Lynn Calcaterra at 216-771-5276 or email: lcalcaterra@crain.com

PA G E 2 2

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

Business of Life

Sports books stage a comeback Cleveland’s first championship in decades fuels a cottage industry

By KEVIN KLEPS kkleps@crain.com @KevinKleps

When the Toronto Raptors won consecutive home games to even the Eastern Conference finals against the Cleveland Cavaliers at two games apiece, Terry Pluto had already written 180 pages of a LeBron James-centric book that Gray & Company had hoped to publish in the next five months.

“If they lost to Toronto, who knows who would be fired or traded,” said Pluto, a longtime columnist at The Plain Dealer and Akron Beacon Journal. “We would have had to postpone the book for a year.”

You might be aware of what happened next.

The Cavs won the next two games against the Raptors, then won their first championship with a historic rally from 3-1 deficit against the Golden State Warriors in the NBA Finals.

“That tied it together. That put a bow on the package,” Pluto says of the Cavs’ title providing the perfect springboard for his latest book, “The Comeback: LeBron, the Cavs & Cleveland.”

The Cavs’ championship benefited a lot of people, from the wallets of business owners to the mindset of jaded fans who were always looking for the next miscue that would be added to ESPN’s Cleveland sports misery montage.

It’s also sparked a lot of books — many of which have been or are being written by Northeast Ohio reporters and columnists.

Pluto’s 235-page book was released Oct. 14 — 11 days before the Cavs began defense of their title.

Three-and-a-half months earlier, Northeast Ohio native Brendan Bowers and Chicago-based Triumph Books put out an instant book — “Cleveland Is King: The Cleveland Cavaliers’ Historic 2016 Championship Season” — that made The New York Times’ best-sellers list for sports and fitness books in August and September.

Prior to the Cavs winning it all, Bob Finnan, a Medina Gazette reporter and former Cavs beat writer for The News-Herald and Lorain Morning Journal, struck a deal with Triumph Books on “100 Things Cavaliers Fans Should Know & Do Before They Die,” which was released Nov. 1.

Sometime next year, Penguin Random House will release a Cavs championship book written by Jason Lloyd of the Beacon Journal. Before that book hits the market, it’s likely that one written by ESPN’s Brian Windhorst and Dave McMenamin — a yetto-be-titled 288-page publication that Amazon says will be released

Terry Pluto, sports columnist and author of “The Comeback: LeBron, the Cavs and Cleveland,” shows Cassandra Misch the inscription he wrote for her father at Barnes and Noble bookstore in Mentor. Misch bought several copies of Pluto’s books for Christmas gifts. (Peggy Turbett for Crain’s)

Books commemorating the Cavs championship by local authors Terry Pluto, Bob Finnan and Brendan Bowers are hot items this holiday.

April 11 — will already be on the shelves.

Yes, it’s been a storybook year for Cleveland sports. And local writers have provided a few stocking stuffers prior to the arrival of more Cavs tales in 2017.

Once Pluto read James’ homecoming essay on Sports Illustrated’s website, he said he knew he’d be writing a book.

“The Comeback” was two-plus years in the making, but publisher David Gray said he wasn’t about to

rush it out once the Cavs capped their Finals comeback.

“Cool T-shirts can be made and marketed in a few days, but good books take months,” Gray said.

Pluto said the book, which tells a behind-the-scenes story of James’ return, was “90%” written prior to Game 7, but after the champagne dried, he had to make sure he delivered the insight his readers expect.

“It’s not, ‘I gotta write a book in two months because a team won a

title.’ It’s the opposite,” Pluto said.

“It’s the impact on LeBron to the franchise, from when he leaves, the decimation, and when he comes back.”

Finnan, who spent 20 seasons on the Cavs beat, said the Finals also provided the ideal ending for his book, which he said is a “reference guide” of sorts for the franchise, which is in its 47th season.

Some of Finnan’s favorite antidotes in “100 Things” come from former coach Paul Silas, who was fired in 2005, 64 games into his second season.

“He was fantastic after practice,” Finnan said. “We’d put the notebooks down, and he would tell us stories about his old Celtics days.”

Finnan said Silas knew his time with the team was running short when Dan Gilbert, who had recently purchased the team, “sent a note to Silas about some coaching move he wanted him to make” during a game.

Silas is also mentioned in the book because of his memorable confrontations with former players Eric Snow and Ira Newble.

“I was standing next to him. He had rage in his eyes,” Finnan said of Silas during his November 2003 spat with Newble in Atlanta. “He wanted to fight.”

Bowers, a Cleveland digital marketing manager, took a different route with “Cleveland Is King.”

Since it was published so quickly after the Cavs’ title, Bowers said he wrote chapters on players that weren’t time-sensitive. For example, there are stories on James’ high school matchup with then-phenom Lenny Cooke and Irving’s long road back from the knee injury he sustained in Game 1 of the 2015 Finals.

After the book’s success, Bowers said he signed a contract with Triumph on an “NBA-related project that will be published in 2017.”

This one won’t be on the Cavs’ first championship, but that’s OK. There are more than enough reading options from a time Northeast Ohio wants to preserve as long as possible.

CRAIN’S SIGNATURE EVENTS 2017 SAVE THE DATE FAMILY BUSINESS FORUM Tentative Date: May Join Crain’s for a welcoming, educational and supportive event that will allow family businesses to walk out with actionable information, connections and ideas to improve their businesses.

CRAIN’S HEALTH CARE FORUM Tentative Date: June Industry experts will examine some of the top issues facing health care.

WOMEN OF NOTE AWARDS Tentative Date: July Crain’s honors the dedication and achievements of Northeast Ohio’s top female business leaders who enrich our region with their professional talents and unique perspectives.

ARCHER AWARDS Tentative Date: August A tribute to Northeast Ohio’s leading human resources professionals who are building companies with the best people, talent, development and culture.

MIDMARKET PERSPECTIVES Tentative Date: August Learn how middle market companies can flourish in today’s ever-changing world.

[M]POWER MANUFACTURING ASSEMBLY Tentative Date: October Educational manufacturing assembly with presentations and breakout sessions.

CLE HOMECOMING Tentative Date: October Reach out to Cleveland expatriates; reconnect and reacquaint them with Cleveland today; introduce them to community leadership and inspire their participation in Northeast Oho’s renaissance

FORTY UNDER 40 Tentative Date: November A tribute to the next generation of rising stars who have taken a leading role in our business community.

C-SUITE GALA Tentative Date: December Northeast Ohio's top executives are honored for their contributions, community commitments and outstanding professional performances.

Questions? Contact Megan Lemke at 216.771.5182 or mlemke@crain.com.

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E A -1

Manufacturing

Tobin Buckner

CEL finding success in bridge monitoring market. Pages A-3

Having a chat with entrepreneur Chris Horne.

Page A-7

Technology

AKRON BUSINESS

Timocco is evolving quickly. Pages A-5

TECHNOLOGY

New doctoral program studies nature to solve human problems

Biomimicry might be UA’s next high-profile field of research

By DAN SHINGLER dshinger@crain.com @DanShingler

Northeast Ohio is becoming a hot spot for the new science of biomimicry, and students from around the world are coming to the University of Akron to enroll in what they say is the only doctoral program of its kind in the world.

The students might be helping provide the school with its next important area of research — and creating some positive international publicity among the tech crowd at a time when the university is struggling to increase enrollment.

And the students already are providing some area engineering departments with new ideas for tackling innovation challenges.

“They all work at area companies, in addition to doing their research here,” said Peter Niewiarowski, a professor of integrated bioscience at UA, about the students in the program.

Niewiarowski is a longtime biologist and an expert on lizards — geckos, to be specific. Now he works to help engineers understand how gecko technology can be applied to making new adhesives.

He also coordinates the fellowship program for researchers who have come to UA to participate in a program that will allow them to study biomimicry as they earn doctorate degrees in integrated biology. So far, there are 17 students enrolled in the five-year program, with the first graduates expected to complete their thesis work next year.

Among them is Bill Hsiung, who is from Taiwan and said he came to Akron because he was excited about biomimicry and UA was the only school he could find offering a doctoral program. The school is helping lead the way in terms of studying the field, he said, giving the U.S. an advantage over other nations.

“The U.S. is out in front on this,” said Hsiung, who was one of the first to enroll in the new program in 2012.

“This is really an emerging field, and the biomimicry program at the University of Akron is one of the first degree programs in the whole world ... I was very interested as soon I found out about it.”

As its name implies, biomimicry involves copying nature to solve human problems, especially with re-

University of Akron professor Peter Niewiarowski with one of his favorite biomimicry lab partners, a Tokay Gecko that might teach humans a thing or two about making adhesives. (Dan Shingler)

gards to engineering and innovation.

It’s not necessarily new. For example, Velcro was invented when Swiss engineer George de Mestral returned from a hunting trip in the 1940s and noticed how burrs were able to cling to his dog’s fur. He emulated the design of the burrs’ barbed ends and invented the hook-and-loop closure system that is now known around the world. Even the Wright brothers copied birds when designing their airplanes.

“If we’re successful as I think we will be, in five years I’ll make the argument to industry that ‘you should be paying $40,000 for that fellow.’ ” — Peter Niewiarowski, a professor of integrated bioscience

Answers in nature But purposefully studying the natural world in the hopes of extracting new strategies and models for all types of engineering is a new area of research.

The modern version of the field of study is largely attributed to Janine M. Benyus, a natural sciences author who penned the 1997 book “Biomimicry: Innovation Inspired by Nature.”

Benyus has supported efforts to foster biomimicry research in Northeast Ohio largely because local leaders were quick to embrace the science and seek her help. After hearing Benyus speak, leaders of Cleveland-based Entrepreneurs for Sustainability, members of the Cuyahoga County Planning Commission and 47 other local biomimicry proponents met with her to lay the ground work for Great Lakes Biomimicry.

Benyus inspired Hsiung with one of her TED Talks, he said. Now Hsiung is studying hedgehogs, the cute animals that look like small porcupines. It turns out, Hsiung said, they have a unique ability to survive a fall.

“In the wild, hedgehogs are very active foragers, especially at night for insects,” he said. “For that, they climb a lot of trees, and it’s not uncommon for them to fall. … Anecdotal stories say they fall from as far as 30 feet, unharmed. During that process, they curve into a spherelike position and their spines stick out. Then their spines bend when they hit the ground.”

In other words, they bounce, rather than break.

Hsiung is studying the animals to see if similar strategies can be used for sports or military helmets, or even to make vehicles safer in the event of a crash.

Then there is Ariana Rupp, a Fulbright Scholar from Portugal who enrolled in the UA biomimicry program in 2015. She’s studying how plants manage temperature to see if she can apply some of their techniques to human engineering.

“Every organism has to deal with energy and temperature management,” said Rupp, who hopes what she learns can be applied to packaging or to keep electronic and medical

devices from overheating.

There are some local students, too, including Rebecca Eagle-Malone, who is from Louisville, just east of Canton. She has the added benefit of working with plenty of animals at the Cleveland Metroparks Zoo, where she is an “animal ambassador” and exposes visitors to biomimicry and its possibilities.

She envisions things like robot snakes that could use specialized locomotion techniques and python-inspired thermal sensors to locate victims of earthquakes who are trapped where human rescuers can’t find them.

Eagle-Malone is also studying how plants remediate soil to see if she can replicate their techniques to clean up man-made pollution, like lead that leaches into water supplies.

Industry support All of the doctoral fellows are doing real work at area companies, too, Niewiarowski said. Sponsoring companies agree to pay the fellows a SEE NATURE, PAGE A-8

PA G E A -2

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS

AKRON

Anti-hunger groups set the table for merger

By JUDY STRINGER clbfreelancer@crain.com

There is no lack of energy or enthusiasm aimed at addressing hunger in Stark County, according to Amy Krebs, director of grants and community initiatives at Stark County Foundation.

Each year, the foundation is flooded with requests from food banks, backpack programs, community gardens and other anti-hunger initiatives. So much so that in 2014 it began a six-month assessment of the various nonprofits around the county that provide nourishment to indi-

â&#x20AC;&#x153;It is about taking two organizations that are doing sort of similar things and sticking them together because there is a lot of overlap.â&#x20AC;? â&#x20AC;&#x201D; Dan Flowers, president and CEO of the Akron-Canton Regional Foodbank

viduals and families in need.

The study uncovered very little coordination or collaboration among those groups and a strong sense of â&#x20AC;&#x153;competition for limited funds.â&#x20AC;? In 2015, the Stark County Foundation, in collaboration with the Paul and Carol David Foundation and Sisters of Charity Foundation of Canton, announced it would award grants to collaborative food-security efforts.

Thatâ&#x20AC;&#x2122;s when Dan Flowers, president and CEO of the Akron-Canton Regional Foodbank, picked up the phone and called Faith Barbato, executive director at Community Harvest, a Canton food rescue nonprofit. â&#x20AC;&#x153;I wanted to sit down and talk about how we could work together,â&#x20AC;?

Flowers said.

Conversations throughout 2015 led to one conclusion: The two organiza-

tions could gain efficiencies and increase their impact by merging. Last month, they publicly announced that the food bank, one of the regionâ&#x20AC;&#x2122;s largest hunger-relief organizations with 75 full-time staff and a $7 million annual budget, would merge its operations with the much more modestly sized Community Harvest, which has one full-time employee (Barbato) and a $120,000 annual budget.

Flowers said that while Community Harvest and the food bank have slightly different collection models â&#x20AC;&#x201D; the bank buys most of its food from manufacturers and wholesalers, while Community Harvest gathers unused prepared foods from ca-

4 ( % 5 . ) 6 % 2 3 ) 4 9 / & ! + 2 / .

/52 %.').%%23 (!6% 4(% !.37%23 !.$ !00!2%.4,9 4(% */"3 */" 0,!#%-%.4 &/2 '2!$3

ters and restaurants â&#x20AC;&#x201D; both are in the business of procuring food and distributing it to area charities. â&#x20AC;&#x153;It is about taking two organizations that are doing sort of similar things and sticking them together because there is a lot of overlap,â&#x20AC;? he said.

The merger is being funded through a $150,000 grant from the Stark County Foundation, the David Foundation and the Sisters of Charity. â&#x20AC;&#x153;The purpose [of the grant] is to help position the combined efforts of both organizations,â&#x20AC;? Krebs said. â&#x20AC;&#x153;They are leveraging their resources, they are enhancing their services, to become more cost effective.â&#x20AC;?

The food bank, Flowers admitted, will bring the bulk of the operational efficiency to the partnership. Along with a number of established administrative functions, the organization has a fleet of trucks and a dispatcher.

Community Harvest has a single truck and no dispatcher. The food bank also has a Rolodex filled with volunteers, which Barbato said she already has taken advantage of when a 15-year volunteer announced his retirement earlier this year. â&#x20AC;&#x153;Faith is down there alone,â&#x20AC;? Flowers said. â&#x20AC;&#x153;She does incredible work.

We donâ&#x20AC;&#x2122;t plan to change that. Immediately, however, I hope that we can assist her a little bit. There are a lot of duties she does being a one-person shop that she will be able to divide among our team without adding too much or overwhelming any of our team members.â&#x20AC;?

Barbato welcomes the help. While she has been able to increase the value of Community Harvest food collections from $750,000 when she started in 2009 to more than $1.5 million today with only a $10,000 increase in the budget, enhancing services without boosting the bottom line significantly becomes harder and harder each year.

And, as it is, â&#x20AC;&#x153;that $120,000 is hard to get,â&#x20AC;? she said.

Community Harvestâ&#x20AC;&#x2122;s major contribution to the partnership is expertise in food rescue, which is a supply stream the food bank does not currently capture. Last year, Community Harvest diverted about 950,000 lunches and dinners from landfills to hot meal programs and shelters across Stark County. The organization does not charge for food pickup or delivery. â&#x20AC;&#x153;With 40% of all food produced never eaten, there is a ton of work still to do,â&#x20AC;? said Barbato, adding the food bankâ&#x20AC;&#x2122;s footprint across eight counties will provide ample opportunity to advance the food rescue mission. â&#x20AC;&#x153;I get calls from all over the country every week about how to start a food rescue program,â&#x20AC;? she said. â&#x20AC;&#x153;We are known nationally as leaders in this space, and the food bank, they are leaders in their space. By joining together, we can better serve the community.â&#x20AC;?

Flowers said he would like to develop and scale a food rescue program in Summit County but will first focus on â&#x20AC;&#x153;stabilizingâ&#x20AC;? the merger at the administrative level. And while eventually the two organizations will likely integrate their fundraising efforts, for now each will continue separate campaigns. â&#x20AC;&#x153;We donâ&#x20AC;&#x2122;t have $120,000 to pick up the expenses of Community Harvest this year,â&#x20AC;? Flowers said. â&#x20AC;&#x153;We are counting on Faith and the Community Harvest board and the community to continue to fund that operation, and then we can add to it rather than step in and take over.â&#x20AC;?

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E A - 3

AKRON

CEL looks to build on success in infrastructure

By DAN SHINGLER dshinger@crain.com @DanShingler

Cleveland Electric Laboratories is at it again.

The Twinsburg company, best known for making thermocouples — a fairly low-tech item to measure temperature but one that is used in countless industrial applications — now hopes it can sell high-tech sensors to monitor pipelines and national infrastructure.

That might sound like a stretch, and it might be one for most companies. But CEL has been down this road before. The company previously set its sights on supplying fiber optic sensors to monitor the soundness of the nation’s bridges and other transportation structures. That was not long after the I-35 Mississippi River bridge in Minnesota collapsed in 2007, killing 13 people.

Thermocouples remain the company’s biggest source of revenue, but installing sensor systems to monitor bridges has become a significant business for the company. CEL owner Jack Allan Lieske said the private company does not break down its financial results for public consumption, but its annual revenue is about $35 million a year.

CEL got into fiber optic technology when it purchased an Arizona company with which it had been partnering on projects. The six-person operation was known then as

Cardinal-Roofing_Crains-Ad_Final.indd 1

“Imagine if the country did a couple hundred bridges every month.”

— Jack Allan Lieske, CEL owner

Instrumentation Specialties Inc. Now, a dozen years later, the Arizona operation has more than 30 employees and functions as CEL’s Advanced Technology Group — and its source of fiber optics expertise. It is run by former Instrumentation Specialties president Rodger Shepherd.

“One of the first areas where we started using this (fiber optics technology) was in bridge monitoring, and now we have some very sophisticated systems in place around the U.S. and Mexico,” said Shepherd, now a vice president at CEL. For example, the company recently installed a fiber optic monitoring

system on the Indian River Bridge in Delaware, a system that includes about 175 sensors and cost roughly $1 million, Lieske said.

Now, the company is installing a similar system on the Brooklyn Bridge in New York.

“We’re starting on the (Manhattan) side and we should get over to Brooklyn in about four to five years.”

Lieske said, explaining that the sensor work is following other bridge renovations as they progress from one side to the other.

CEL will continue to pursue new work on bridges and other infrastructure, but it is also continuing to expand its product line and the markets it serves, Lieske said.

That includes monitoring systems for underground infrastructure in cities around the nation, too, Shepherd said. The company has developed sensors that can constantly monitor underground environments and alert city officials if any unauthorized access takes place. That’s important, in part, because cities more than ever need to protect underground copper wiring from thieves, as well as secure phone, data, sewer and water lines.

Now the company hopes the oil and gas industry will be its next big market. CEL has developed a system that uses electronic components and fiber optic communication lines to monitor pipelines, compressor stations and the internal pipes and plumbing of natural gas processing centers and oil refineries.

“It’s basically a microphone, and we’re listening to the flow of material through the pipeline. Anything flowing makes a certain sound,” Shepherd said.

The system can tell by changes in the frequency or amplitude whether anything has disturbed the pipeline, or if a leak has developed, Shepherd said. Soon, he hopes, it will be good enough to tell pipeline operators the volume of gas or oil flowing through the line at any given time.

Currently, oil and gas companies monitor their in-use pipelines largely via aerial observation. That process has become cheaper and easier to implement in recent years, thanks to drones, but it still only provides a snapshot of the pipeline’s condition.

Shepherd and Lieske said a chief advantage of their system is that it provides constant, real-time information.

What they don’t yet know is how many microphones the system needs or, more specifically, how far they can be spaced apart. That will determine the cost of the system, and the company’s test facility in Arizona does not allow for long stretches of pipeline to be installed and tested.

CEL is looking for a company in the oil and gas industry to work with to test the system on longer runs. So far, it has found no takers, though officials just started looking, Lieske said.

The company hopes its new fiber optics products do well because its infrastructure and pipeline monitoring

systems bring in higher margins than its thermocouples. It also hopes that these new markets prove to be faster growing than the steel, glass and other old-line industries that are its biggest customers for thermocouples.

Recently, things might have turned a bit in CEL’s favor, too.

President-elect Donald Trump has promised to both increase infrastructure spending and to be more friendly to oil and gas development in the U.S. If he follows through, that could mean more investment in pipelines and infrastructure.

Virtually all of the nation’s bridges could benefit from structural monitoring, and some of them desperately need it, Lieske said.

“This could be a huge industry nationally. Imagine if the country did a couple hundred bridges every month,” Lieske said.

But the tailwinds are also far from reliable.

Though investments in drilling and pipeline construction have increased somewhat in recent months, low prices for oil and gas are still depressing activity and environmental concerns have slowed some pipeline projects.

But just developing its new products has given CEL a head start in some new markets, along with eight patents on its new technologies.

“We don’t have competitors in a lot of these new markets, and we have new patented products that we never thought we’d have,” Lieske said.

11/16/16 9:18 AM

PA G E A - 4

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

AKRON

PRC stays ahead of the communication curve

By JUDY STRINGER clbfreelancer@crain.com

To say that Prentke Romich Co. has grown up along with its market is not an overstatement.

The Wooster company, founded in 1966, introduced its first assistive technology in 1969. Based on a discarded Teletype machine, the device allowed those who were mute to type out messages. Early products were bulky and laborious.

Fast forward to today. PRC manufactures assistive communication devices — often portable — with touch screens, customizable voice synthesizers, sophisticated language systems, Internet connectivity and even input systems that can determine what a user wants to say by tracking eye or head movements.

And, of course, it offers apps that deliver some of these specialized speech capabilities to tablets and smart phones.

“What we do today is just unrecognizable from 40 to 50 years ago,” said Dave Moffatt, president and CEO. “It’s a great technology evolution story.”

All the while, more babies survived premature births and more adults survived strokes and traumatic brain injuries. The population of people with motor impairments or paralysis increased.

Add to that the rising incidence of autism among children and ALS, or amyotrophic lateral sclerosis — known as

Moffatt PRC’s devices perform tasks that commerical tablets can’t. (Contributed photos)

Lou Gehrig’s disease — among adults.

To make a long story short: As the technology evolved, it reached more people, and there were more people to reach. PRC began as a startup

by Barry Romich, a freshman engineering student at Case Western Reserve University, and Ed Prentke, an engineer at the former Highland View Hospital in Cleveland, known for treating and rehabilitating victims of strokes and spinal cord injuries. The company has grown over five decades to 150 employees in Wooster — with production, engineering, tech support, service and repair, shipping, marketing and administration there — and another 50 on foreign soil.

PRC today, with revenues exceeding $50 million, is the largest alterna-

tive and augmentative communication (AAC) technology company headquartered in North America and the second largest in the world (Stockholm-based Tobii Dynavox is the largest), according to Moffatt.

“We export through subsidiaries and distributors to about 20 countries,” he said, “and we’ve translated our language systems into a variety of international languages.”

Dave Hershberger, CEO of PRC’s Saltillo Corp. subsidiary, believes keeping ahead of technology has been a key to the company’s success and longevity, especially when it comes to designing systems and software that are robust and easy to use.

“The real challenge of these devices is how you organize the language so

that someone can have as much flexibility in what they are saying as possible but also be able to get there as quickly as possible,” Hershberger said.

Moffatt also credits the importance of the support offered to users, their care takers and clinicians.

“One of the things we do distinctively well is providing a great deal of support for the implementation of these technologies,” he said.

Neither executive, however, discounts the impact of population dynamics. Estimates suggest between 3% to 4% of the population, at some point in their lives, will have a disorder or condition serious enough to necessitate the use of a communication device. Those rates are on the rise, driven primarily by an aging population and increases in autism and ALS. The incidence of autism is approaching 1 in 65 children, Moffatt said. About half of those kids are nonverbal, he added.

Meanwhile, the ALS Association says that every 90 seconds someone in the U.S. is diagnosed with disease, which robs people of their ability to speak or move.

Meher Banajee, an AAC specialist, speech pathologist and clinical assistant professor at the Louisiana State University Health Sciences Center New Orleans, said better detection accounts for some of the ALS increase. Still, adults with ALS now make up about half of her caseload, which just five to 10 years ago was

dominated by children with autism and cerebral palsy.

“A lot of it is being attributed to head trauma, but we really don’t know why we seeing a more cases,” Banajee said.

All told, Moffatt estimates the AAC market is between $500 million to $750 million worldwide and growing.

PRC and Saltillo, which turns 20 this year, both make standalone systems as well as apps that can be bought for use on iPads and the like. PRC’s main product is the Accent line of speech-generating devices. The company markets accessories.

Only a handful of companies have a similar range of AAC offerings.

There are dozens more that supply only speech apps or niche communications tools.

It would seem the pervasiveness of iPads and other consumer devices coupled with the relatively low cost of apps (about $150 to $300, compared with dedicated AAC systems, which start in the $3,000-$4,000 range) would put at least part of PRC’s market share at risk. But Banajee said there are many tasks, such as eye tracking, that commercial tablets can’t do. Plus, she said, many young AAC users — not unlike their peers — want their personal devices for games or movies, not learning and communicating.

“There’s a need for both approaches,” she said. “I don’t see that changing anytime soon.”

Need a customized solution for your business financing?

As your business grows we’re here for you.

It’s your personal mission to ensure that your company succeeds. We take the same approach to customizing your business financing. It’s our mission to provide you with the nimble, individualized financing you need. Your company succeeds - mission accomplished.

Call your local lender today.

Cathy Campriani, VP/Commercial Relationship Manager 330.687.9714 | CCampriani@homesavings.com HomeSavings.com

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E A - 5

AKRON

Fun and friends key to Timocco’s growth

By JUDY STRINGER clbfreelancer@crain.com

Eran Arden knows a thing or two about starting a business.

Before agreeing to spearhead the development of a fledgling Israeli technology company, Timocco, in 2010, Arden ran a startup incubator in Israel, not unlike the Akron Global Business Accelerator where he and Timocco’s U.S. operations are now based.

Arden still has many ties to the entrepreneurial community in Israel and, when given the opportunity, stresses the importance of a U.S. presence to his startup “friends” abroad. And he tells them Northeast Ohio is the place to be.

“First, because there are great partners to work with,” the CEO said, “but also because of the fact that most of the startups are centered in New York and Boston and [Silicon] Valley, and if you are here, there is more patience, tolerance and energy to make sure you will be moving forward as fast as you can.”

Moving forward fast is a good way to describe Timocco’s evolution since it opened its Akron office in August 2015. The company markets motor-skills games to occupational and physical therapists working with children who have autism, cerebral palsy or developmental delays. Arden expects to net roughly $1 million in licensing revenues from its web-

based therapy programs in 2017, a market the company — with a little help from a lot of new “friends” — has built from the ground up.

Those friends, Arden said, include the city of Akron, specifically deputy mayor for economic development Samuel DeShazior, and BioEnterprise, specifically Matthew Miller, who is vice president of health care IT and services for the Cleveland bioscience accelerator.

Fairlawn-based LLA Therapy and Dr. Troy McClowry also helped Timocco to understand the nuances of the U.S. market and professional needs. Then there is Laurie Cramer, executive director of the Autism Society of Greater Akron, who has connected Timocco with stakeholders in the autism community. And, most recently, a University of Akron career fair introduced the company to scores of “young computer science and business majors that might want a summer/spring internship,” according to Timocco business development manager Andrew Novak.

“Things are working amazingly for us,” Arden said. “We have school systems in the U.S. already paying to use the platform. We have big clients like the New York Department of Education, which is the biggest school district in the country, [and] Los Angeles Unified, which is the second largest.”

Closer to home, the public school districts in Cleveland, Akron and Pittsburgh are paying Timocco cus-

tomers, while Miami-Dade Public Schools in Florida — another of the nation’s largest — is piloting the software. Other clients include Cincinnati Children’s Hospital; Hasbro Children’s Hospital in Providence, R.I.; Shriners Hospitals for Children in Philadelphia; Kennedy Krieger Institute in Baltimore; and Akron Children’s Hospital.

In all, Arden estimates 200 to 300 therapists across the country are using Timocco’s gaming platform in their practices.

Unique in the field Local ingenuity and elbow grease aside, the company’s early success in the U.S. market has much to do with the uniqueness and utility of its product. Sure, commercial apps and interactive white boards are playing an integral role in encouraging kids with developmental delays to practice certain skills and in allowing educators and therapists to track progress in ways not possible before, Arden said.

But Timocco is the first company, he said, with a dedicated game-based platform that motivates the child to move in ways known to improve gross motor control and coordination.

These are not “new” movements per se. It’s just that children, like most of us, don’t get excited about following instructions that are part of a prescribed therapy routine. However, take those same movements and make them part

of a game and, viola, better patients.

“This approach to introducing improved motor movement is somewhat addictive to the children who use it,” said Terry Martell, entrepreneur in residence at the Akron Global Business Accelerator and adviser to Timocco. While the company cannot yet make medical claims about the efficacy of its gaming therapy — studies to demonstrate patient progress are underway — therapists using the program in schools have cited “a lot of continued use” by at-risk students, Martell said.

Stephanie Riley, an occupational therapy assistant with Akron Children’s, has used Timocco’s program with her preschool patients. Along with the habit-forming nature of the games, two big advantages, she said, are the broad set of skills incorporated into the program and the fact that patients can do it at home.

“With a lot of the therapies, parents may have to do something different at home because maybe they don’t have all the tools or cannot afford the exact same tool,” Riley said.

“Being able to send them home with a plan and have it be the exact same thing as they do here is very helpful.”

Looking to grow Arden said Timocco currently has six employees at its Akron office and field reps stationed in Texas and Maryland. Its technology develop-

ment operations remain in Israel, although sales and marketing are focused on the U.S. market and operate out of Akron.

The company is looking to raise $750,000 to $1 million in venture funds to support growth, which he said will include infiltration into more school systems as well as new products and markets. Just last month, the company introduced a new controller and games designed to help specifically with supination and pronation movements, which are important for rotation of the hands.

It is also actively marketing a game-based platform to assist in the development of handwriting skills, not only for children with disabilities but any child struggling with handwriting motions. The Cleveland Metropolitan School District is using that product, according to Arden. In addition, Timocco is piloting and developing a product for use in adult rehabilitation.

Arden admits that being the first to market and the only company “generating the conversation on this particular technology” can be a challenge, but he thinks the presence in some of the nation’s largest school districts is a good base from which to start.

“To relocate the company from Israel to the U.S. and within a year have such huge clients already utilizing [the program] and paying, my team members and board members in Israel and the U.S. are really excited,” he said.

Does your company have a technical challenge?

Let MAGNET connect you to the country’s best national labs!

7DNH DGYDQWDJH RI JURXQGEUHDNLQJ UHVHDUFK WKURXJK MRLQW 5 '

*HW DFFHVV WR UVW FODVV IDFLOLWLHV DQG HTXLSPHQW YLD ODEV DQG XQLYHUVLWLHV

*DLQ DQ HGJH RYHU \RXU FRPSHWLWRUV E\ WDNLQJ DGYDQWDJH RI VXEMHFW PDWWHU H[SHUWLVH

5HFHLYH D KDQGV RQ FRQVXOWDWLRQ VSHFL FDOO\ WDLORUHG WR \RXU FRPSDQ\ȆV QHHGV

Want to know more?

Contact Tim Nevin at 443.632.5008 or email timothy.nevin@magnetwork.org

PA G E A - 6

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

AKRON

Innovation Foods feeds its hunger for growth

By BETH THOMAS HERTZ clbfreelancer@crain.com

Thomas Lane will admit that he’s been in the food service industry a long time: He began working as a dishwasher at age 12.

That was the start, and he went on from there. His first job at a higher-end place was at Barrington Golf Club in Aurora, and, after some stops along the way and culinary training, he ended up as an executive chef in Cleveland.

It was 2002, though, when he achieved his dream of opening a catering business, Red’s Place in Twinsburg. Five years later, he opened two day care centers, one in Red’s building on Darrow Road. The two ventures dovetailed — the children needed good meals, after all.

Several years later, though, Lane found his business heading in a new direction after a summer child care program asked Red’s to provide 600 daily meals. Then several local schools started contracting with him to provide about 60 meals a day each.

Lane ultimately founded Innovation Foods in 2009 to meet the demand for daily commercial meal ser-

vices and in 2013 moved into a 5,500-square-foot industrial space on Midway Drive in Twinsburg.

Today, his company has grown to provide 3,500 breakfast and/or lunch meals across 36 locations, mostly charter schools and day care centers. That number includes 550 daily meals he started providing for senior citizens this year through Mobile Meals of Akron.

And he isn’t done growing. He is in the process of becoming licensed to provide direct-to-consumer meals through the Area Agency on Aging.

“There is a huge void in this area for that service,” Lane said.

He also is hoping to win new school contracts as they come up for bid.

To help manage the growth, Lane took over an additional 4,500-squarefeet in his building in June, with the added space allowing more room for offices and food storage. It is being equipped with added refrigeration units this month. He also has plans to add more kitchen equipment and vehicles, and possibly a second shift when the time is right.

He currently employs about 29 part-time and full-time personnel at Innovation Foods, with another 40 part-time and full-time workers at

the two New Adventures day care centers (the second one is in Mantua, and he is scouting locations to open two new sites in 2017). He has added several upper-level positions in recent years, including a project manager to help with growth opportunities, a part-time human resources manager, three marketing staffers and a bookkeeper.

The Red’s Place catering business remains an important segment of the enterprise, though Lane moved it to the industrial park location, too, about two years ago to make room to expand the after-school care program at New Adventures.

Lane doesn’t discuss his business financials, but he did say the catering business’ volume has remained relatively unchanged over the years as the commerical side has grown. Catering accounts for about 10% of income today, while his overall business interests have grown eightfold since he launched Red’s, he said.

Powerful memories Lane grew up receiving free or reduced-price lunches and said he never forgets that the meals his com-

United Way of Summit County

THERE’S STILL TIME TO MAKE A YEAR-END GIFT Your year-end, tax-deductible donation can help support our Bridges Summit County “Getting Ahead” program, which empowers local people living in poverty to develop their own plan for financial stability. Your donation of $20 will support one hour of participation in a ‘Getting Ahead’ workshop. $2,000 will support full participation in the 32-session series for one individual. Any increment in between helps families build more stable, successful lives. Help us reach our goal of seeing 200 new graduates from Getting Ahead by July 1, 2017!

DONATE AT UWSUMMIT.ORG/GettingAhead United Way of Summit County 330.762.7601 | uwsummit.org

pany serves children might be their only access to good nutrition each day. Most of Innovation Foods’ products are made from scratch, he said.

A dietitian on staff helps ensure meals meet nutritional requirements as well as clients’ specific dietary needs, and three staff members are culinary school graduates.

“We can bid on contracts with price or quality, and we do our best when quality is a priority,” he said. “If we provide the best quality, we will raise the bar in this market. Even if we aren’t providing food to a specific child, we know they are getting a better meal because we pushed the boundary on what they receive.”

Lane said he also believes that quality requires hiring the right people, and he works to groom future leaders from within when possible.

He often hires from a pool of past interns and rarely has to advertise to fill a higher-level job. For example, food service director Paul Ackman was hired as what Lane calls “an overqualified sous chef” but was promoted several times and now oversees meal quality.

“Having quality people in place allows me to focus on growing the business side of the company,” Lane said.

However, he still has a hands-on approach; you might even see him still washing dishes. In fact, he sees such actions as emblematic of what he calls Innovation Foods’ distinct corporate culture, in which every person is expected to do whatever it takes to meet a client’s needs. If an order is missing a pack of hamburger buns, you don’t just credit their account. You get in the car and take it to them.

Similarly, if a company wants to

provide a holiday meal for its night shifts, Innovation Foods will be there at 2 a.m. if needed. Ackman said he believes it is one of the only companies in the area to offer 24-hour service upon request.

“Most people we hire could work elsewhere and make more money, but the people who do well here value our vision and the commitment to quality,” Lane said. “It’s how we know who fits in with us, and we fast-track those people for growth.”

To thank his staff, and help the entry-level ones stretch their paycheck (a strong memory of his childhood), the company serves a family-style meal to everyone each day at lunchtime.

“It helps foster teamwork,” he explained.

Global Village Academy in Parma is a client of Innovation Foods, which meets the cold breakfast and hot lunch needs of 154 students, said the school’s food service director, Jonathan Hejnal. His facility doesn’t have the capacity to produce those meals.

“They do a fantastic job providing us with meals that meet the national school lunch program rules,” he said.

“They take care of what we need, and when I need to talk to someone, I don’t get a phone tree. I get a real person.”

Some other vendors weren’t interested in bidding on his schools’ business because they are too small, but Innovation Foods was willing to work with him.

Hejnal said he frequently offers feedback about what his students like, and what they don’t. While about 60 to 80 students order lunch most days, the most popular meals (chicken nuggets, hamburgers and grilled cheese) will draw about 100 orders at the beginning of each month.

You’ve got to please even the youngest customers, after all.

CRAIN’S CLEVELAND BUSINESS

|

D E C E M B E R 19 - 2 5 , 2 016

|

PA G E A -7

Entrepreneurship: Tobin Buckner

Five questions with entrepreneur Chris Horne Chris Horne may be silly, but he’s very serious when it comes to making a difference in Akron. He is the founder of The Devil Strip, a biweekly arts, entertainment and culture publication for and about Akron’s creative community with a circulation of 14,000. And his Unbox Akron idea — which collects products from around town and ships them to subscribers — was named one of 32 winners of the Knight Foundation’s Cities Challenge in 2015.

I chatted with Horne about his projects, his adopted home of Akron and his thoughts on the future of our entrepreneurial community.

You moved here from Macon, Ga. How is Akron treating you so far, and what do you like most about the entrepreneurial spirit here?

What I like most is also a reflection of how well the city has treated me.

In a word, it’s collaborative. Early on, I was lucky enough to strike up conversations with Elizabeth Tyran at Urban Eats Cafe and Nick Petroski at the OSC Tech Lab. Both were very supportive of my idea, and that gave me enough confidence to really give this a shot.

Since then, whether it’s been from other entrepreneurs, like Jill Bacon Madden, who owns Jilly’s Music Room, or folks in the nonprofit sector, like Beth Boggins at United Way of Summit County, we received more support than this little rag deserved. That’s indicative of the overall spirit of Akron, I think.

The “little rag” you’re talking about is The Devil Strip. How did it get started?

I’d become frustrated in my journalism career because I wasn’t in a position to tell stories as much as I’d like. And one of the first things I noticed about Akron is that it had no guide to the local culture, which is what I seek out whenever I visit a city.

Leading up to our first print issue, I realized there were a lot of people doing some impressive things in Akron, but they were in their own little worlds doing it. I figured the magazine could become a sort of public commons where these different folks, their fans and supporters would meet, connect and be found by others.

I thought of the print edition as the “bat signal” for local creatives.

Fortunately for me, a lot of those folks — more than 100 of them so far — also contributed their time and talent to the magazine, and a core of about 15 make up our editorial team (one full-time employee, one part-time and a mix of freelancers and volunteers).

Would you call yourself an unlikely entrepreneur?

I’m a three-time college dropout who’s about 40 kinds of stupid. I mean, I left a stable, well-paying job to run into the embrace of an industry that few Americans say they trust and most everyone else thinks is dying. So, the title of David Giffels’ excellent book, “The Hard Way on Purpose,” feels very applicable here.

Whether this makes me a likely or unlikely entrepreneur, I’m not sure.

What I do know is that I love to learn things, and I have high aspirations for what we can accomplish with The Devil Strip. So I’m hoping I’ll prove to

Tobin Buckner is JumpStart’s Akron entrepreneurial community manager and writes a blog about entrepreneurship in Northeast Ohio.

be a successful entrepreneur, even if it takes a minute.

What do you see as the most critical issues for local small

businesses right now?

Right now there are thousands of people who work downtown but don’t engage in the culture downtown. I don’t blame them, though. It’s our job to engage them, to show them why lunch at Diamond Deli and dinner at Nuevo are better than Subway and Applebee’s. It’s our job to help them discover what makes Crafty Mart infinitely better than Black Friday sales.

We won’t convince people to leave the safe, consistent experiences they’re having at national chains if the local alternatives aren’t truly

excellent. So, we need to really focus on building and maintaining a strong community of small businesses with consistently high standards.

If you could tell our city, state or country one thing right now, what would it be?

It’s OK to be wrong. Entrepreneurs have actually made a fetish out of failing and failing fast. That’s because it’s not good to live in fear of failure. I know I used to believe some truly dumb and sometimes harmful and hurtful crap, and I thought I was absolutely right the whole time. It

sucked finding out I was wrong, but not as much as it would have if I hadn’t been willing to accept the basic idea that I could be wrong.

Without getting all political, I don’t know if the country is more polarized right now than ever before — I imagine 1861 to 1865 was worse — but I know you can’t have a real conversation with anyone if you’re not willing to be wrong about something.

If you can’t have a real conversation, then you can’t connect. If you can’t connect, you can’t build community. And without community, what is there?

TWO-ROOM SUITES | COMPLIMENTARY DRINKS | FREE MADE-TO-ORDER BREAKFAST

The New

in Akron/Canton for Meetings

From the moment you walk through the front door, you’ll know you’ve arrived somewhere special. With its open, airy, contemporary and stylish design, your meeting attendees will feel inspired, motivated and appreciated. See for yourself why everyone is saying, the NEW Embassy Suites Akron Canton Airport will ‘Lift Your Spirits.’

For your next meeting contact Julie Karam, Director of Sales and Marketing, at 330.526.7042 or julie.karam@hilton.com

ESCA_49005_CrainsJrPgAd_8.125x10.indd 1

7883 Freedom Avenue N.W. | North Canton, OH 44720 P: 330.305.0500 | akroncantonairport.embassysuites.com I-77 at Shuffle Road (exit 112), just south of the Akron-Canton Airport.

10/17/16 4:42 PM

PA G E A - 8

|

D E C E M B E R 19 - 2 5 , 2 016 |

CRAIN’S CLEVELAND BUSINESS

AKRON Main Course: Jennifer Karpus-Romain

Oak and Embers barbecue spot readying new Hudson site

This artist’s rendering shows the exterior of the new Oak and Embers Tavern in Hudson. (Contributed photo)

Your Complete News Coverage Tune in to 89.7 or download the WKSU app for in-depth local, national and world news.

WKSU, an equal opportunity, affirmative action employer, is committed to attaining excellence through the recruitment and retention of a diverse workforce. 16-UR-00310-118

ON VIEW THROUGH JAN. 15, 2017 “… fun and truly exciting to wander through; to call it a feast for the eyes is a bit of an understatement.”

Marc and Gretchen Garofoli knew they wanted to take their neighborhood barbecue concept to Hudson even before opening Oak and Embers Tavern in Geauga County nearly three years ago. When they couldn’t find the perfect location, they targeted Chesterland instead.

But Marc Garofoli always kept a close eye on Hudson.

“My first inclination was to go to Hudson. And I couldn’t find anything that was for sale and/or reasonable,” he said. “Now, we are lucky enough that Marcelita’s became for sale.”

When Marcelita’s Mexican Restaurant in Hudson closed in October, Garofoli jumped at the chance to buy the site. Hudson is a strong community with great families and growth opportunities, he said.

With renovation construction on schedule, the Garofolis aim to open the restaurant around Super Bowl weekend at the beginning of February.

Garofoli, who with his wife previously owned restaurants in downtown Cleveland, declined to comment on the exact purchase price of the property, but said it was more than $1 million.

Additionally, renovation costs have been substantial, he said.

“We changed the complete interior, 100%,” he said.

The 8,200-square-foot space was gutted and is being repurposed for Oak and Embers’ rustic, Southern barbecue joint vibe. The space will be accented with wood and metal, and will include big barn doors that can

NATURE CONTINUED FROM PAGE A-1

—Anderson Turner, Akron Beacon Journal, 10/16/16

One South High I Akron, OH 44308 I 330.376.9186 I AkronArtMuseum.org

stipend of $20,000 per year, he said.

For that, the companies get a halftime employee engaged in cutting-edge research, and the fellows get to apply what they learn to industry, rather than working as teaching assistants.

For example, Rupp spends half her time at the product-design firm Nottingham Spirk in Cleveland, where she hopes her discoveries related to plants and temperature control might contribute to new packaging ideas.

Early corporate support was a big reason the University of Akron program got off the ground successfully, Niewiarowski said. Sherwin-Williams, GOJO, Ross Environmental Services and Parker Hannifin were all quick to support the program and quick to put it to work developing things like new color coatings, dispensing systems and flexible tubing systems — all based on biologic strat-

Oak and Embers, at a glance: Where: 7774 Darrow Road, Hudson.

Projected opening: Early February.

The vibe: A neighborhood barbecue restaurant with a rustic feel and craft-made food.

Specialties: Bourbon, beer, brisket, burnt ends and ribs.

Menu: Options will include a smoked chorizo meatloaf sandwich, pulled pork dinner, baby back ribs, smokehouse fillet, apple slaw, white cheddar grits and more.

create separate spaces inside, such as a party room.

The aroma will matter just as much, if not more, than the aesthetics.

“We want you to be able to come in and smell that good smoke from the smoker (and) that nice hickory wood and not want to leave,” Garofoli said.

Other improvements include changing the roof line and raising the ceiling in some rooms.

Oak and Embers’ Hudson site will be able to seat about 300 and plans to accommodate anyone from those grabbing a casual beer to catch the big game to those hosting a lunch meeting or a baby shower.

To meet the needs of customers, 60-70 part-time employees will staff the Hudson location.

From the beginning, the focus has always been on food, Garofoli said. egies employed by snakes, butterflies and other critters.

“The four of them jumped on board, and we quickly had four Ph.D. candidates from around the world,” Niewiarowski said.

The companies are getting good ideas and, in some cases, even patents from their pursuit of biomimicry, he said. In fact, Niewiarowski said, they might be getting such a good deal that the cost of company sponsorships will go up — but he’s going to wait until he can show measurable results to make that pitch.

“If we’re successful as I think we will be, in five years I’ll make the argument to industry that ‘you should be paying $40,000 for that fellow,’ ” Niewiarowski said. “Right now, I can only make that argument based on theory, but in five years I’ll be able to make it based on data.”

Trailblazers So far, the school is doing well, said Tom Tyrrell, a former steel industry executive who is the founding CEO of Great Lakes Biomimicry,

“We are known for our bourbon selection, our beer selection and our barbecue. But it’s all about the brisket and the ribs and the burnt ends.”

Everything at Oak and Embers is scratch-made. Garofoli said the business does not get food deliveries from big-box suppliers. In fact, 90% of food product entering the restaurant comes in from his pickup truck because he hand-selects all meats and aims to purchase non-GMO produce.

“We’re craft-made from start to finish, meaning that our salad dressings, our marinades, our barbecue sauce, everything is 100% made from scratch,” he said.

With barbecue as Oak and Embers’ hallmark, a lot of attention is paid there. All pork, poultry and beef is marinated more than 24 hours in a special house rub and then slow smoked with hickory.

“Our barbecue sauce has 12 bottles of bourbon in it. …That’s a 30 gallon order every morning,” Garofoli said.

While Garofoli declined to disclose projected revenue for the Hudson location, he said he hopes it is as successful as Chesterland. While he could see a third location, it would not be for three to four years down the road. Ultimately, the Garofolis aim is to make these two restaurants run perfectly before expanding. When the time is right, they’d look to go west.

“I would love to go down to Fairlawn, but Fairlawn might be a little bit close to Hudson,” he said. a nonprofit that promotes the field in the region with both industry and educational institutions. He is also the person who introduced Niewiarowski to biomimicry and helped get the program going in Akron.

“We’ve got 13 corporations and organizations involved with the Akron program. That’s good,” Tyrrell said. “They are the first program of their kind, and I think that’s why we’re able to grow it.”

Going forward, however, Tyrrell wants to expand his nonprofit’s reach and the use of biomimicry by area corporations and universities.

Already, in addition to UA, Lorain County Community College and Baldwin Wallace University are offering coursework based on biomimicry.

Tyrrell also said the concept has gotten good support from area foundations, including the Cleveland Foundation and Akron’s GAR and Knight foundations. His next step will be to hire a full-time development officer early next year to increase fundraising to support expansion.