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Private equity firms on the prowl

THE RISE, UNRAVELING AND RETURN OF JEFF CHRISTIAN

Last replenished in ’07, injections needed By MICHELLE PARK mpark@crain.com

Mum’s the word, but there are signs that the hunt for dollars is on. Although they’re restricted by securities law in what they can divulge publicly about their fundraising efforts, a number of local private equity firms appear poised to embark on raising the cash they’ll need for future investing, if they haven’t begun the process already. “This is logically going to be a big fundraising year because everyone needs to put more gas in the tank,” said John Mueller, a partner with CapitalWorks LLC, a private equity firm in Cleveland. While he steered clear of revealing See PROWL Page 11 MARC GOLUB

Jeff Christian, founder of the powerhouse executive search firm Christian & Timbers, is rebuilding his life after a young man’s death led to a year for him in jail. Mr. Christian has started both a for-profit company and a nonprofit foundation, the latter of which helps individuals dealing with drug and alcohol addictions.

AN ICON’S ROAD TO REDEMPTION World of indulgence, tragedy becomes sobering foundation for new purpose in life By SCOTT SUTTELL ssuttell@crain.com

J 16

eff Christian lived the high life before he was brought low by drugs, alcohol and what he now describes as “an ego that was out of control.” His world today is very different. Prison has a way of doing that. Mr. Christian used to be a big shot. He was the man who built executive search firm Christian & Timbers (now known as CT Partners) into a national powerhouse that, most famously, handled the search that placed Carly Fiorina in the CEO suite at Hewlett-Packard in 1999. Mr. Christian was quoted

INSIDE: Tracking Mr. Christian from the 1980 founding of his Christian & Timbers executive search firm through his arrest and to today. Page 20 frequently in The Wall Street Journal and other national publications, did work for blue-chip technology clients including Microsoft and spent more time in Silicon Valley and on the road than he did at home. “My whole life was about money and success,” he said in an interview last week. That changed in December 2006,

when Mr. Christian was indicted on reckless homicide and involuntary manslaughter charges. The charges stemmed from the drug overdose death the previous spring of 31year-old Thomas Wasil, who had attended a party at Mr. Christian’s Aurora home. The tragedy pulled back the curtain on Mr. Christian’s private life, which was in turmoil due to drug and alcohol addiction. On Oct. 22, 2007, Mr. Christian received a three-year sentence for his role in Mr. Wasil’s death; he entered prison that day and, under terms of a plea deal, served exactly one year in jail. See CHRISTIAN Page 20

ERs receive healthy dose of attention By TIMOTHY MAGAW tmagaw@crain.com

Northeast Ohio’s health systems are investing millions of dollars to muscle up their already-booming emergency rooms amid the prospect of thousands of newly insured patients entering their doors because of the federal health care overhaul. Coordinating preventative care to avoid costly emergency room visits is an anchor of the health care reform legislation. However, an escalating shortage of primary care physicians could lead to an even greater influx of patients in the ER, according to various health care professionals. See ER Page 21

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HIGHER EDUCATION All signs point to a more robust market for internships ■ Page 13 PLUS: GREEN INVESTMENTS ■ ONLINE COURSES ■ & MORE

Entire contents © 2011 by Crain Communications Inc. Vol. 32, No. 16

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APRIL 18 - 24, 2011

CITY LIVING Young professionals are moving to or near big cities in a big way, according to an analysis of housing data from 2000 to 2009. In Cleveland, the number of 25- to 34-year-olds who have a four-year degree or higher and live within three miles of the city’s central business district rose 49% in that decade, representing a gain of 1,302 people. Here’s how Cleveland shapes up against selected other cities:

Young professional gain 2000-2009

% gain

Atlanta

9,722

61%

Cincinnati

2,001

28

Cleveland

1,302

49

Columbus

4,033

45

Detroit

1,968

59

Indianapolis

2,669

83

Pittsburgh

3,155

40

Metro area

SOURCE: ANALYSIS OF DATA FROM 2000 CENSUS AND 2005-2009 AMERICAN COMMUNITY SURVEY

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MidTown Tech Park momentum builds Developer Geis acquires properties to repurpose as parking, incubator space By JAY MILLER jmiller@crain.com

Geis Cos. is extending its commitment to Cleveland’s Midtown district with plans for a $6.5 million rehabilitation of a building at 7000 Euclid Ave. that will be a companion to its under-construction MidTown Tech Park.

Leasing is going so well, said Fred Geis, a partner in Geis Cos., that the Streetsboro development firm is buying two nearby properties even before the first tenant moves into its $28 million MidTown Tech Park. Hemingway Development, a division of Geis, is acquiring two buildings east of the tech park, at 6900 and 7000 Euclid Ave. It will redevelop

MAKE THAT CHANGE

7000 Euclid, once the home of Dean Supply Co., into additional office and incubator space. It will tear down the building at 6900 Euclid, which is between the 128,000-square-foot tech park and the building at 7000 Euclid, for parking for the complex. Fred Geis, his brother Greg and investor James Doyle are the principals of Hemingway Development. “Obviously were trying to create an environment for multiple projects to move forward,” Fred Geis said in a telephone interview last Wednesday, April 13. “We’re trying to create a campus.”

The MidTown Tech Park is the first piece of the “Health-Tech Corridor,” a public-private partnership kicked of in 2010 to attract biomedical and technical companies, especially those in incubator space in the area of University Circle, to the district between University Circle and downtown Cleveland. “Fred’s had a vision that is closely aligned to what we want,” said James Haviland, executive director of MidTown Cleveland Inc., a community development nonprofit that represents business and property owners in Midtown. “What we’re seeing is

BEFORE Huntington Bank is making upgrades to its bank branches, including this location in Strongsville. The newer features include a brighter lobby, e-merchandising, new seating in offices and waiting areas, and hospitality centers that offer coffee and tea to customers. PHOTOS PROVIDED

AFTER

C

redit quality isn’t the only thing looking prettier at banks these days. Several institutions are investing millions of dollars to freshen and upgrade their Northeast Ohio branches — an effort that for some means new carpeting underfoot, new paint on the walls and new technology, including TV screens and customer Internet stations. Columbus-based Huntington Bank plans to renovate to some degree every branch in its footprint over the next 14 or 15 months at an estimated cost of $70 million. Updates to all 98 Northeast Ohio branches should wrap up by the mid- to late fourth quarter, said David Hawkins, senior vice president and director of customer experience. Local work will account for $11 million of the expenditures. First Federal of Lakewood is in the midst of improving about one-third of its

Green infrastructure advocates get hands dirty

By KATHY AMES CARR kcarr@crain.com

Each year, billions of gallons of raw, untreated sewage spill into Lake Erie and nearby rivers. A

Selling day and night Mr. Geis said his firm is selling the See GEIS Page 8

“The goal is that they start to have a life of recovery in prison … and when they leave, we wrap our arms around them.” — Jeff Christian, founder of the nonprofit Number 12 Foundation and the for-profit Revenue Beast. Page One

“Fundraising is the lifeblood of private equity groups. The ability to successfully fundraise … allows us to not only maintain our employee bases, but hopefully to expand them as well.”

“There is an increasing recognition of the importance of internships. … Increasingly, employers want people who have some kind of experience, even new college graduates.”

INSIGHT

conglomerate of environmentally conscious Northeast Ohio organizations are not willing to go with that flow. Instead, several parties from the public and nonprofit sectors want to assist the Northeast Ohio Regional Sewer District in reducing the overflow of muck that contaminates the region’s water system every time runoff enters the sewer system’s pipes during rain storms. As part of a settlement reached

this vision of a health-tech corridor playing out really nicely.”

— Graham P. Hearns, spokesman for The Riverside Co. Page One

See BANKS Page 8

Government, nonprofit groups to assist sewer district with upgrades

Greg Geis

THE WEEK IN QUOTES

Banks renovate NE Ohio branches, add new amenities By MICHELLE PARK mpark@crain.com

Fred Geis

last December with the U.S. Environmental Protection Agency, the sewer district must make $3 billion in infrastructure improvements over the next 25 years to reduce the release of raw sewage into local waterways to 494 million gallons per year from the current 4.5 billion gallons annually. Part of that plan includes capturing 44 million gallons a year through green infrastructure projects that store or redistribute the storm water.

The sewer district already is conducting a feasibility study that seeks to identify optimal pockets of vacant land in Northeast Ohio that could be transformed into green infrastructure projects, such as wetlands or rain gardens — depressions that feature plants, gravel and sand capable of absorbing excess water. The study is scheduled for completion in December. The sewer district has eight See GREEN Page 6

— Ann Womer Benjamin, executive director of the Northeast Ohio Council on Higher Education. Page 13

“We’ve seen an uptick compared to when things were really bad. Companies are beginning to feel better about spending money for employee development and training.” — Barbara Hanniford, dean of continuing education at Cleveland State University. Page 17

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Crews working at the Cleveland Medical Mart and Convention Center have a goal of recycling 95% of the debris removed, like the piles seen here. DOUG BARDWELL

Med mart crews eye recycling goal has been recapitalized by

Some materials to be reused at new complex By STAN BULLARD sbullard@crain.com

and

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Mound-builders are at work in Cleveland’s Flats. Instead of using stone tools, these modern-day mound-builders operate backhoes, cranes and 100 trucks, the latter of which are loaded with concrete, soil or other materials that are hauled across downtown daily from the construction site of the Cleveland Medical Mart and Convention Center. These crews are fulfilling an objective to recycle 95% of the debris removed from the old Cleveland

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Convention Center and four demolished buildings at the site of the new complex, according to Dave Johnson, public relations director for the medical mart and convention center. Since early January, crews have hollowed out the old convention center from St. Clair Avenue to the north side of Lakeside Avenue. In the process, they have excavated 83,390 cubic yards of material from the site, Mr. Johnson said. The effect of digging that blockslong hole at the convention center is apparent on the east bank of the Cuyahoga River in the Flats. There, near Main Avenue, crushed concrete stretches skyward a few yards from where the Wolstein Group and Fairmount Properties are constructing Ernst & Young Tower and its associated structures as part of the Flats East Bank mixed-use project. Mr. Johnson said the medical mart plans to reuse as much as 25% of the crushed concrete for stone fill as well as sidewalk and road beds on its site. The rest is bound for other construction projects in the region, including the Flats East Bank and the Inner Belt Bridge construction project, Mr. Johnson said. Soil from the medical mart project also will be put to fresh use, although Mr. Johnson said he has no statistics for how much has been trucked to Flats East Bank and other parts of the Flats for the Inner Belt project. Crews on the medical mart site are separating steel, copper and other materials to recycle it as scrap. Other materials are bound for third-party recyclers who sort out as many materials as possible. Mr. Johnson credits the medical mart’s developer, Chicago-based MMPI, for the sustainability efforts in Cleveland, as it has followed such practices for several years. He said Van Auken Akins Architects LLC in Pepper Pike, one of its architects, has held regular workshops on sustainability and steps to win LEED Silver

“We’ll have another great example of the importance and effectiveness of sustainable building.” – Michele Kilroy, coordinator of Northeast Ohio Chapter of the U.S. Green Building Council certification for the project. LEED stands for Leadership in Energy and Environmental Design. To achieve such a ranking, the developer also must use energy-efficient lighting, heating and cooling equipment and plumbing fixtures. Meeting the LEED guidelines has presented an unexpected challenge for the medical mart project, which razed two of downtown’s open public spaces as it demolished Mall B and Mall C to get at the underground convention center and ballroom. Plans call for the new convention center’s roof replacements to be a more bucolic Mall B and Mall C, Mr. Johnson said, which would be more in line with the original plans for the Mall by famed park designer Frederick Law Olmsted, known as the father of landscape architecture. The catch, Mr. Johnson said, is that a project doesn’t get any points in the LEED ranking system “for replacing a green roof with a green roof.” The medical mart is pursuing a lofty goal for diverting demolition debris from landfills, especially for a project of huge scale. Michele Kilroy, coordinator of the Northeast Ohio Chapter of the U.S. Green Building Council trade and advocacy group, described 50% recycling of construction debris as a first level of achievement and 75% a secondary level. “I think this project is coming in rather high with a 95% rate, which I think demonstrates that it can be done at that level. It’s exceptional,” Ms. Kilroy said. “When the Medical Mart and Convention Center is completed, we’ll have another great example of the importance and effectiveness of sustainable building.” ■

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Tech entrepreneurs hatch advisory plan Investors commit cash, expertise to aid startups By CHUCK SODER csoder@crain.com

Now that they’ve sold their shares in Solon-based Findaway World, Christopher Celeste and Blake Squires have the time and money to help other companies enjoy the same success they’ve had. The two entrepreneurs are giving their full attention to Hatch Partners LLC, a firm they created to invest in young companies and to provide consulting services to both startups and established companies looking for new ways to grow. “We work with people who are either starting or stuck,” Mr. Celeste said. Messrs. Celeste and Squires — who in 2004 founded the company that would become Findaway World — technically started Hatch about two years ago, around the time that Mr. Celeste left his position as president of the company, which makes Playaway-brand digital audio players. At the time, however, Mr. Squires was still chief strategy officer at Findaway World, which today has about 125 full-time employees. And though Mr. Celeste started working with a few entrepreneurs through Hatch, he considered it a part-time job. Then, last November, Mr. Squires left Findaway World with the goal starting a new venture with Mr. Celeste. Instead, they decided to expand one that already existed. “We said, ‘Why don’t we just put both our hands on Hatch?’” said Mr. Celeste, who is the son of former Ohio Gov. Richard Celeste. They have firepower at their disposal. In December, Messrs. Celeste and Squires, as well as a third investor, sold their shares in Findaway World to the company’s majority owner. They declined to identify the owner or the third investor, nor would they say what they received for their shares. However, they did say the sale provided them a lot more cash to invest. They expect the typical Hatch investment to be in the range of $30,000 to $50,000, but they noted that the firm would be willing to invest as much as $500,000 in one company, if it found the right opportunity. In addition to cash investments, Hatch also provides coaching to entrepreneurs and consulting serves to companies looking to launch a product or accelerate their growth in some other way. Clients can pay in the form of cash or stock. Hatch already has made investments in a few companies, including MedCity Media, a Cleveland-based news service that covers the business side of the health care industry, and Beyond Motherhood LLC of Cleveland, an online community aimed at helping mothers get back into the job market. Its investments, however, will not be limited to Northeast Ohio. They also have invested in their own startup, MovBand LLC. The company has developed a new type of pedometer that students participating in school fundraisers would use to track their steps. The accelerometer-based product is designed to be more durable than other pedometers but less expensive than other devices that use accelerometers, Mr. Squires said. A key innovation, however, is how they plan to market the MovBand:

EARLY TO INVEST Hatch Partners LLC will invest in and advise startups and counsel established companies looking for growth. Its early investments: ■ MedCity Media, a news service that covers the health care industry ■ Beyond Motherhood LLC, a web site that helps mothers get back into the job market ■ MovBand LLC, their own company, that has developed a new pedometer that helps track steps in fundraisers Schools would pay for the devices with a portion of the money students raise as they count their steps.

A handful of clients already pay for Hatch’s coaching and consulting services, too. Among them is Naratte Inc. of Palo Alto, Calif. The two entrepreneurs are a great team, said Naratte chief development officer Byron Alsberg, who met Mr. Squires when Findaway was just getting off the ground. Mr. Squires, he said, is particularly knowledgeable when it comes to supply chain management, and Mr. Celeste’s specialty is marketing. Mr. Alsberg said finding a consulting firm that can do all that Hatch does would be hard, even in Palo Alto, in the heart of Silicon Valley. “To have that kind of a combination in one shop is pretty tough to find,” he said. ■

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Blake Squires (left) and Christopher Celeste of Hatch Partners LLC

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APRIL 18 - 24, 2011

Ohio Capital Fund infusions proceed, though future hazy By CHUCK SODER csoder@crain.com

will be renewed is unclear.

Two investments made by the state-financed Ohio Capital Fund over the past two months bring to seven the number of investment firms that have an office in Northeast Ohio because of the fund, which will run out soon unless renewed by the state Legislature. The Ohio Capital Fund, which invests in venture capital firms that commit to investing at least half the money they receive from the fund in Ohio-based companies, a few weeks ago committed an undisclosed amount of money to Edison Ventures of Lawrenceville, N.J. Last month, the fund also announced an investment in Arsenal Venture Partners of Winter Park, Fla. Both hired part-time investment managers in Cleveland. Now the $150 million Ohio Capital Fund has just $10 million left to invest, said fund manager Paul Cohn. The fund, which the state created in 2005 to boost investment in Ohiobased startups, has invested $125 million in 23 funds to date, putting the average investment at $5.4 million. The fund is retaining $15 million in case returns from investments don’t come fast enough to cover various expenses, Mr. Cohn said. Those expenses include interest payments that will begin next year to bondholders that bought bonds to finance the Ohio Capital Fund. Should the fund’s investments lose money, the state will pay back bondholders with tax dollars. Although the Ohio Capital Fund has many supporters, whether it

The Ohio House of Representatives in May 2010 unanimously passed a bill that would have authorized the Ohio Venture Capital Authority, which oversees the fund, to sell another $100 million in bonds to finance the fund. However, that bill never received a vote in the Ohio Senate and since has expired. The bill’s authors, state Reps. Jay Goyal, D-Mansfield, and Sandra Williams, D-Cleveland, introduced an identical bill this year, but now the Legislature faces larger concerns, such as how it will fix a shortfall projected to exceed $8 billion in the state’s next two-year budget. Though he is not actively pushing for the extension of the fund, Mr. Cohn lauded the program’s track record of attracting capital to the state. With the Edison Ventures and Arsenal Venture investments, there now are eight out-of-state venture capital firms that have opened manned offices in Ohio after receiving money from the Ohio Capital Fund. Plus, managers from two in-state funds told Crain’s that they never would have formed if not for investments received from the fund. Of those 10 investment firms, Edison, Arsenal and five other groups — including Chrysalis Ventures of Louisville, Ky.; Arboretum Ventures of Ann Arbor, Mich.; Radius Ventures LLC of New York; RiverVest Venture Partners of St. Louis, and Bridge Investment Fund, a new Cleveland-based fund — have hired employees to search for invest-

An uncertain fate

ments in Northeast Ohio. An eighth firm, Draper Triangle Ventures of Pittsburgh, has an unmanned office in Cleveland and has become an active investor in the region.

Investments add up As of last Dec. 31, the venture capital groups that are new to Ohio had invested $41 million in 16 companies in the state; those investments include seven companies in Northeast Ohio, Mr. Cohn said. The Ohio Capital Fund at the time had distributed just $31 million of the $56 million it had committed to those groups, not including Edison or Arsenal. Mr. Cohn noted that those groups have invested more money in Ohio than they’ve received. Same goes for the broader list of 23 venture capital firms that have received Ohio Capital Fund money, he said. They have invested about $140 million in 50 Ohio-based companies, giving the Ohio Capital Fund an ownership stake in each one. One of those firms, advertising analytics firm ClearSaleing of Columbus, was acquired in January by GSI Commerce Inc., making it the first in-state Ohio Capital Fund portfolio company to be sold. Another, in Cincinnati, has struck a deal to be acquired, though details have yet to be announced, Mr. Cohn said. ClearSaleing received an investment from NCT Ventures of Columbus. Neither NCT nor Bridge Investment Fund in Cleveland would have formed without the Ohio Capital Fund, said NCT managing partner Rich Langdale and Bridge managing partner Michael Goldberg. â–

Green: Land reuse work advances efforts continued from PAGE 3

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years to make $42 million in green infrastructure upgrades under the settlement with the EPA. “It involves a lot of coordination with a lot of other partners,� said Kyle Dreyfuss-Wells, the sewer district’s manager of watershed programs. Because of various vacant land reuse initiatives in development or under way, sewer district officials can tap resources that wouldn’t be at their disposal if agencies such as the Cuyahoga County Land Reutilization Corp. or the nonprofit Neighborhood Progress Inc. had not been tackling over the last couple years the region’s vacant land issue. “There’s been a great deal of work done on specific projects that repurpose vacant land, and the sewer district has been a part of that,� said Chris Warren, chief of regional development for the city of Cleveland.

Narrowing down the field Sewer district officials say they are looking at factors such as soil condition and the amount of contiguous vacant land as they assess potential locations for green infrastructure projects. Gus Frangos, president and general counsel of the Cuyahoga County Land Reutilization Corp., said the county’s land bank is working with the sewer district to identify potential sites. The process goes beyond just mapping, he said. “We have software that pulls

property and tax records and other information from all kinds of databases� about vacant plots and surrounding properties, Mr. Frangos said. “We can help them be a lot more strategic about their plans.� City officials in Cleveland, meanwhile, also are working with the sewer district to help identify optimal spots for green projects. The city has about 16,000 vacant parcels available in its land bank. “We hope to help them identify 12 to 15 potential sites by late summer, then narrow it down from there,� Mr. Warren said. Bobbi Reichtell, senior vice president for programs at Neighborhood Progress, said she sees the sewer district’s green infrastructure investments as larger-scale models of what several entrepreneurs have been doing as part of the community development group’s vacant land reuse plan — ReImagining a More Sustainable Cleveland — the backers of which include about 30 regional partner organizations. Neighborhood Progress and the city of Cleveland since the start of last year have financed 57 pilot projects, including urban farms and rain gardens, that are putting vacant land to reuse. Thirty-six projects are complete, and the other 21 are scheduled for completion by June 15, Ms. Reichtell said. The sewer district is testing similar waters. It announced last Wednesday,

April 13, it will issue at least five grants of about $10,000 each for small-scale green storm water demonstration projects.

Function, and form, too Meanwhile, to facilitate the sewer district’s larger plans, Neighborhood Progress established in March a ReImagining Cleveland Coordinating Committee that will serve as the sewer district’s advisers while its green infrastructure program proceeds. Kent State University’s Cleveland Urban Design Collaborative also is collaborating with the sewer district on making sure its green infrastructure projects are functional, said Terry Schwarz, director. “These will be neighborhood amenities, like urban wetlands or parks, that attract other investments,â€? Ms. Schwarz said. “We’re not talking about a retention pond behind a fence. And these projects don’t preclude residential and commercial development.â€? After the sewer district’s feasibility study is complete and potential parcels of land for green infrastructure projects have been identified, Ms. Schwarz said, land reuse stakeholders will need to form even more partnerships. “Once the mapping is done, we need to engage the community development groups and the rest of the private sector,â€? she said. â–

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Geis: Developer seeks tax credits continued from PAGE 3

project hard and he believes he will have 75% of the 128,000 square feet in the under-construction building leased by early June, when tenants will be able to occupy it. “We’re working hard at it; we were making presentations from 7 a.m. to 7 p.m. yesterday,” Mr. Geis said. “We have people moving in June 1 and we hope to have others moving in in September.” The only announced tenant is JumpStart Inc., the nonprofit that nurtures fledgling businesses. It said last November that it would sign a 10-year lease for 9,500 square feet in the new building. It is expected to be the first tenant in the building. The Geis campus is the first

multitenant rental space in the Health-Tech Corridor. “One thing we haven’t had is an ample supply of space,” Mr. Haviland said. “Now Fred has brought online a new-construction option and an adaptive-reuse option.” The Health-Tech Corridor was kicked off in 2010 as one of former Gov. Ted Strickland’s “Hubs of Opportunity and Innovation” — a state effort to create clusters of development centered around particular industries. Along with the hub designation came a $250,000 grant to help brand and market the district. The Geis complex gives the corridor two price points for potential tenants — premium-priced new space and economical rehabbed space.

A division of Streetsborobased Geis Cos. continues to make investments in Cleveland’s Midtown district.

A high-tech advantage Geis Cos. is asking the city of Cleveland for a 10-year, 60% tax abatement on the property at 7000 Euclid. It also is seeking $1.3 million in partially forgivable loans for the project. In addition, it expects to use federal New Market Tax Credits to bring down the cost of financing. Cleveland City Council has approved the loans and the council’s community and economic development committee approved the tax abatement at its meeting last Tuesday, April 12. The project is expected to be approved by council’s finance committee and then the full council today, April 18. Tracey Nichols, the city’s director

JAY MILLER

of economic development, said she believes the city is in a good position to woo health care information technology companies and other IT companies to Midtown. She said a fiber-optic trunk line that runs underneath Euclid Avenue allows IT firms to save thousands of dollars because of the easy tie-in to the Internet. The city also is attractive to the young work force of IT companies, Ms. Nichols said.

Banks: Investments suggest industry stabilization continued from PAGE 3

18 branches, and when all is said and done, the improvements will cost about $2 million, said David Shaw, senior vice president of retail banking. And New York-based Chase is

doing far more sprucing up in this market than Jeff Papa can remember in the decade he’s overseen the East Ohio market as retail market manager, at an estimated cost of $3 million to $3.5 million. Banks upgrade branches in

cycles, but that they’re doing it now — during a tough revenue market and to an extent they haven’t in years — is another sign that their health is on the mend, industry insiders say. “The obvious conclusion is they’re gearing up toward an improving

economy,” said James Thurston, spokesman for the Ohio Bankers League. Investing in resources that put on a good face to customers indicates banks have their eye on increasing their market share, he added. It also helps that many Ohio institutions have more money available to invest in upgrades than banks in states such as Florida and Georgia, where banks were harder hit by the banking crisis, Mr. Thurston noted.

Make way for video Cleveland’s KeyBank actually did renovate during recent, tumultuous years, including 2008 and 2009, and completed its 63-branch revitalization in late 2010. The work included video screens behind teller areas and more confidential, enclosed offices for meetings, said Todd Hays, senior vice president and retail executive for Northeast Ohio. Across Huntington’s footprint, there hadn’t been much work done on the branch network since probably the Sky Bank acquisition in July 2007, Mr. Hawkins noted. The coming renovations include brightened interiors and video messaging to replace signs. The electronic merchandising will be used not only to market Huntington products, but also local events and businesses. Huntington’s capital investment is rooted in its desire to seize on the current environment. For one, it wanted to command a higher profile in the marketplace at a time when other institutions have reined in their investments. Also, construction costs are lower than they would be if the building market was robust. “We’re already seeing some upticks in terms of labor costs and material costs,” Mr. Hawkins noted.

The Geis firm also has its sights set on a third project in Midtown, the aging and vacant Warner & Swasey complex at East 55th Street and Carnegie Avenue. Mr. Geis said redevelopment there won’t get under way until a city- and state-financed environmental cleanup is completed. The plan is to turn the late 19th century machinetool plant into 180,000 square feet of mixed office and industrial space. ■

“It’s still better than it would have been two years ago and probably much better than it would be two years from now.”

Sprucing up for others? First Federal, a mutual, also had not renovated in recent years; it is doing so currently, in part, because it acquired Century Bank last December, Mr. Shaw said. “Having standardization and some uniformity is important,” he said. The work that will be done will depend on the branch. First Federal added last summer a drive-through ATM for increased convenience at its Fairview Park location and plans a dramatic facelift for the Parma branch it acquired from Century. Other locations will receive less modification. Chase’s Mr. Papa and several other bankers emphasized that even while newer banking methods, such as online banking, are growing in popularity, people still bank inside banks. “We find our branches are extremely busy,” Mr. Papa said. “Our transactions that we do in the branches are very stable and in fact are growing.” One bank executive who requested anonymity opined that some institutions may be renovating, in part, to build up their franchise value in the event of a future acquisition. Huntington’s Mr. Hawkins doubts that’s the motivation. Before he joined Huntington in fall 2010, he worked for a Portland, Ore., bank that acquired some 15 institutions over a decade. “I really believe that folks that are doing it … they’re in it for the long term,” Mr. Hawkins said. But, speaking to acquisitions Huntington might make, he also admitted, “I’m hoping that when we buy (other banks), we get some spiffed up-places. It would make my life easier.” ■

CRAIN’S SEEKS COMEBACK KIDS On June 27, Crain’s Cleveland Business will publish a special section called “Northeast Ohio’s Comeback Kids: Great Business Turnaround Stories.” We’re aiming to profile individuals or businesses that have proven to be battle-tested — those that came close to the brink of ruin, but instead moved in a positive direction due to careful management and calculation. Nominations can be submitted via e-mail to sections editor Amy Ann Stoessel at astoessel@crain.com; please include “Comeback Kids nomination” in the subject line. In

addition, they can be sent via regular mail to Ms. Stoessel at 700 W. St. Clair Ave., suite 310, Cleveland 44113. More than anecdotal evidence — such as current and past revenue and employment numbers, in the case of businesses — is preferred and recommended as part of the nomination. Turnarounds must have been sustained over at least a two-year period. Nominations should be no longer than a single page. The deadline for submission is the close of business on Monday, April 25.

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PUBLISHER/EDITORIAL DIRECTOR:

Brian D. Tucker (btucker@crain.com) EDITOR:

Mark Dodosh (mdodosh@crain.com) MANAGING EDITOR:

Scott Suttell (ssuttell@crain.com)

OPINION

What a waste

B

udgets are balanced by matching revenues with expenses, and Gov. John Kasich has been an absolute lion in attacking the expense side of the ledger as he looks to balance Ohio’s budget. However, when talk turns to closing tax loopholes that could provide the state with hundreds of millions of dollars in added revenue, the governor is a real pussycat. He needn’t be. There is a road map Gov. Kasich could follow for bringing more cash into the state treasury without raising tax rates. It’s the Ohio Tax Expenditure Report, and it provides a list of 128 “tax expenditures” — tax breaks that take the form of exclusions, exemptions, deductions and credits and collectively add up to several billion dollars of revenue the state forgoes each year. Since 1987, the state tax commissioner has been required to submit the report as a supplement to the governor’s two-year budget. The report doesn’t address the merits of the tax exemptions. However, it’s meant to be what tax commissioner Joseph Testa calls “an important resource for those making decisions about Ohio’s tax policy.” The idea behind the report is for elected officials to assess whether the economic benefit gained from extending a particular tax break is worth the revenue lost to the state. To that end, the report does a great job of estimating for each tax break the state’s revenue loss in each year of the current two-year budget and each year of the next biennial budget. Sadly, though, the report has been a waste of effort and disk space because governors and legislators have disregarded its contents. Gov. Kasich doesn’t seem inclined to break with this tradition, based on a recent email from spokesman Rob Nichols after Crain’s inquired about whether the governor may look at doing away with certain tax breaks. “One person’s tax expenditure elimination is another person’s tax increase,” Mr. Nichols wrote. And right now, Mr. Nichols later said, “most Ohioans don’t believe that they are currently under taxed.” Most Ohioans don’t, and we wouldn’t mess with individual tax breaks. But what about some business tax breaks that are of dubious economic value? Take the tax break for our business — newspapers. We’re exempt from sales tax, to the tune of about $17 million in lost tax revenue per year. Would we sell fewer papers if they were taxed? Probably not. Want bigger game? Ohio excludes the first $1 million of a business’s gross receipts from the commercial activity tax, which is set at 0.26%. Instead, the tax on the first $1 million is just $150 — a break that costs the state $200 million a year. We’d suggest a business that can’t afford to pay $2,600 a year on that first $1 million in receipts doesn’t belong in business. Tax breaks never die in Ohio; rather, the list of them just grows. That’s not smart tax policy, nor is it responsible governance, especially in a state struggling to make ends meet. Gov. Kasich should put added teeth behind his budget roars by calling for the elimination of tax breaks with little economic justification for their existence.

FROM THE PUBLISHER

Focus on the economy, nothing more

T

economic decline that threaten our state’s his is going to be another week future as never before. Repeat after me, for moral issues, dear readers, as members of the House and Senate: “It’s well as the continuing mystery jobs, jobs, jobs.” And if you forget that that is our General Assembly. one, focus on this classic: “It’s the econMore correctly, this is directed to a omy, stupid.” certain group of elected officials who Now, just two months later, our legisreally should be doing something else for lators are dealing with a bill that came a living rather than making laws. out of the Republican-domiRegular readers might recall nated Senate that allows people the slight rant I went on a few BRIAN with permits to carry concealed weeks back when the General TUCKER weapons to have those guns in Assembly — facing the most bars, restaurants and open-air dire budget deficit Ohio had stadiums that sell alcohol. seen since the Great Depression Really? Are you kidding me? — decided to consider what Not to fear, however, says would be the nation’s strictest Sen. Tim Schaffer of Lancaster, ban on abortions. Dubbed the the bill’s sponsor. The law “heartbeat bill,” it would ban wouldn’t allow the gun-holder abortions after a fetal heartbeat to drink alcohol while carrying. can be detected. Now that’s a relief. He’s just going to I’ll say it again now, for those who be packing heat in an environment missed my mid-February column: This is where emotions run high and fists have not about the moral debate over abortion, been known to fly. Can you imagine an issue that continues to stir deep sitting in Cleveland Browns Stadium emotions four decades after the Supreme wondering which nutcase is going to get Court first legalized pregnancy terminaso mad at another fan that he pulls out tions. his pistol? This is about focusing every ounce I’m not a gun-control advocate, but I of energy into reversing decades of

do believe our laws still don’t do a very good job of keeping weapons out of the hands of those who intend to harm others. Think Jared Loughner, a critically wounded congresswoman, a dead little girl. Our elected representatives need to stop — if they can possibly muster the self control — and turn all their attention to Ohio’s economic future. For the foreseeable future, each and every Ohioan should judge the quality of their legislators based on nothing but what they’re doing to get this state working again. We all hear young people make their plans to leave Ohio as soon as they can. We read the stories about successful economic transformations elsewhere. We know it can happen here, especially given the wealth of higher-education institutions Ohio is fortunate to have. But it will be made even more challenging — as if anybody thought the hill could get steeper — when those we elect waste their time on “hot-button” issues designed to generate publicity for themselves and help craft their next political opportunity. Shame on them for doing it, and shame on us for electing them. ■

THE BIG ISSUE Cities across the country are considering enacting laws restricting what restaurants can use in their food. Do you support this possibility?

NICHOLE PETERS

MARIE MAJDALANY

DENNIS BAHENA

JIM HAY

Wadsworth

Huntington, W. Va.

Lakewood

Cincinnati

I would say yes because with the growing obesity rate in America, I think we need to be forced to do something about it.

I’m concerned about the health of my child. When we go out, even the amount of sodium is outrageous. Of course ... if we restrict what is going to be used, you’re going to pay more.

I would not support it. Just leave it up to the people to choose what they want to eat.

I don’t know that I would support laws governing what they can and cannot put in (food), but I would certainly support laws of more disclosure to benefit the consumer.

➤➤ Watch more of these responses by visiting the Multimedia section at www.CrainsCleveland.com.

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Any combination of county, school workers would require new home ■ The suggestion in Brian Tucker’s March 28 commentary that Cuyahoga County government employees and Cleveland city school district employees combine in one building may have merit, but any combination should be done in an existing building rather than a new building. Any new building would likely become enmeshed in incompetence, cost overruns and scandal, as demonstrated by the county’s $40 million Ameritrust Tower fiasco.

LETTER Vacancy rates are high downtown and large volumes of quality office space are available for much less than the cost of new construction. I suggest any new home for the more than 2,000 county/school district employees should be very near Public Square. Public Square is the hub of public transportation and would allow cheap and convenient

when CapitalWorks may go to market for its next fund, Mr. Mueller said he’s heard other prominent private equity firms are there already. It makes sense, he said, because a lot of firms raised money in and around 2007, and a typical investment period for a fund is roughly three or four years. As for CapitalWorks, Mr. Mueller did disclose the firm has invested nearly 80% of the fund it raised in 2007. When funds are 80% invested, he said, firms typically begin to plan for the next one. Private equity firms raise funds from institutional investors and highnet-worth individuals, then invest the money in companies to generate returns. Many of the local firms raise money, in part, from local people or people with ties to the region. Ultimately, those private equity firms that successfully raise money and produce solid returns with their investments stay in business. “Fundraising is the lifeblood of private equity groups,” said Graham P. Hearns, spokesman for The Riverside Co., one of this region’s most prolific private equity firms. “The ability to successfully fundraise … allows us to not only maintain our employee bases but hopefully to expand them as well.” Successful fundraising also sets the stage for local investment, which could spur growth. “If (private equity firms) employ that capital in Northeast Ohio, it can be very good to the local economy,” said Jeffrey Kadlic, managing partner of Evolution Capital Partners LLC in Pepper Pike.

Proximity doesn’t hurt Local firms don’t necessarily invest in companies in Northeast Ohio, so it’s hard to predict what their fundraising may mean for local companies in need of capital.

But there’s something to be said for proximity. “I do think that having a very active private equity community in Northeast Ohio is a plus for companies in Northeast Ohio because they do tend to have better access to the decision-makers,” said Charlie Crowley, managing director of Paragon Capital Group in Mayfield Heights, which represents companies seeking investors or looking to sell their businesses. As a result, it might be easier for local businesses to get a serious look, Mr. Crowley said. When private equity firms raise funds, they often use local professional services providers, including accountants and attorneys, and they offer local people the opportunity to participate in a high-return investment class, which can result in wealth-building for the region, insiders note. There also are intangible benefits to private equity fundraising here, Mr. Crowley said. “It helps to enhance the reputation of this region as an influential player in the capital markets,” he said. “It’s nice to have money coming in, to be controlling money.”

Haves, and have nots A number of local private equity firms haven’t raised money in some time, said Mr. Kadlic with Evolution Capital, which last raised a fund in 2006. “The markets were locked up,” he said. “There wasn’t a lot of buying and selling going on because you had challenges with your portfolio. You raise money based on your realized returns. “If you’re not selling things, either because there aren’t buyers out there or the business you have isn’t prepared to sell, you’re not in a position to raise money. You don’t have the exits, and your portfolio isn’t looking as good as it did before the

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recession.” Firms’ ability to attract capital now will be the “bright line in the sand” — an indicator of who has staying power, said Jim Marra, director of business development for Blue Point Capital Partners, a Cleveland private equity firm. That’s because consolidation is expected in the private equity business, and also because fundraising will be more challenging than it was the last time firms did it, Mr. Marra said. For one, a provision of the DoddFrank Wall Street Reform and Consumer Protection Act severely limits the way banks, which historically have been big investors in funds, may invest in private equity. Plus, investors who’ve lost money during the recession may not be willing to invest as much into new funds, noted Gregg A. Eisenberg, corporate and securities practice partner with Benesch, Friedlander, Coplan & Aronoff. “I think there’ll be winners and losers, and I think the firms that have a great track record (of generating returns) will be successful,” Mr. Eisenberg said. “Those with low to mediocre returns will not.” Raising a private equity fund historically has required six months to a year, but insiders note it now can take up to 18 or 20 months. As a result, some firms may start the process sooner than they normally would. Mr. Eisenberg is rooting for the local firms to succeed with their fundraising efforts, though he admits his intentions are a tad selfish, as their success drives demand for his services. “Cities our size — you do not see this many private equity funds, and I hope it continues,” Mr. Eisenberg said. “It makes us a very sophisticated deal town, and we’re known for it.” ■

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IN BRIEF Demand for high-tech visa program down by over 50% Demand is off to a slower start this year than in previous years for H-1B visas, which are used to bring into the United States prospective employees with college degrees and special skills. U.S. Citizenship and Immigration Services began accepting H-1B visa petitions for the 2012 fiscal year on April 1. However, only 5,900 peti-

tions had been filed by April 8 under the general H-1B visa cap of 65,000, and only 4,500 petitions had been filed under a 20,000 visa cap for those with master’s degrees or higher. In comparison, the USCIS had received 13,500 petitions under the 65,000 cap in fiscal year 2011 and 5,600 petitions under the 20,000

11

SALT • SALT • SALT

transportation to county/school offices for both employees and visitors. This would also generate a needed increase in pedestrian traffic and vitality around Public Square.

Prowl: Activity helps local companies continued from PAGE 1

CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

cap in the same time period — between April 1, 2010, and April 8, 2010. Demand had been stronger in previous years. The caps were reached in one day for the 2008 fiscal year. Staffing firms, including those that provide information technology workers, have been among those using H-1B visas. — Staffing Industry Analysts

Formerly

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Medina outfit takes aim at better putting Clearview product gains momentum, but founder finds uphill climb for quirky club’s acceptance

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By JOEL HAMMOND jmhammond@crain.com

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Only five players putted better than Tiger Woods in the second round of this month’s Masters, when Mr. Woods surged into contention with an electrifying round of 6-under 66. One of them was eventual winner Charl Schwartzel, who ranked second in putting for the week. Conversely, only two players putted worse than Mr. Woods did during Saturday’s third round, when Mr. Woods shot 74 to fall back. So when Steve Ross says he based his putting invention on Mr. Woods’ “neutral position and repeatable motion,� it stands to reason he means the Friday Tiger, and not the Saturday version. Mr. Ross’ Medina company, Clearview Putter, is trying to make inroads in the cutthroat world of golf equipment, where he said if your name isn’t Titleist, Callaway or another big one, the going is tough. Mr. Ross says his product — a clear, acrylic putter — helps golfers repeat their stroke every time and assists with aim. The putter has a “dual-line� system: A black horizontal line perpendicular to the putter’s face that ensures a straight stroke, and a vertical green line to help with hand and shoulder movement. If a red line appears in front of that green line during the putt, a player’s shoulders are moving too quickly; if the red line appears behind the green, the player’s wrists are too

The Clearview putter

“It looks like it’s not going to have a good feel; it looks like glass. But it has a great, soft feel.� – Jimmy Hanlin, director of golf, Little Mountain and StoneWater golf clubs loose, and moving without the shoulders.

‘What the heck is that?’ Jimmy Hanlin, director of golf at Little Mountain Golf Club in Concord and StoneWater Golf Club in Highland Heights, has served as an adviser of sorts, connecting Mr. Ross with the right people in the industry. He has no financial stake in Clearview Putter and was not involved with the development of the club, but said his role with it was born when he first used the club on the putting green at Little Mountain. (LPGA legend and current NBC golf analyst Dottie Pepper also endorses the product.) “When I first saw it, I thought, ‘What the heck is that?’� Mr. Hanlin said. “It looks like it’s not going to have a good feel; it looks like glass. But it has a great, soft feel.

“It’s a perfect aid to be in the same position every time you putt.� Yet it’s been an arduous task in breaking the establishment, Mr. Ross said. The Strongsville High School graduate originally was motivated to develop the club after attending in 2008 the PGA Merchandise Show, held each January in Orlando. “In eight miles of stuff, there was no training tool I found to be useful,� he said. On his flight home, he read in a golf magazine that 90% of golfers don’t aim right when they putt, or at least aim where they think they are aiming. So he took a square piece of polycarbonate, attached a shaft and tried the lines. Voila.

Shades of the metal driver Now, Mr. Ross and three other employees are pitching the putter to clubs, courses and retailers. Mr. Ross said the putter is sold at 40 to 50 courses nationwide, including the elite Seminole Golf Club near Palm Beach, Fla.; Mr. Ross said Muirfield Country Club in Dublin, home of Jack Nicklaus’ The Memorial Tournament, has requested the product. Two-time U.S. Open winner Retief Goosen has used two different models, and a handful of Champions Tour players are using the putter. Recently, two-time Masters champion Bernhard Langer asked Mr. Ross to be fit, and all told, 26 pro players have been fitted for the club, Mr. Ross said. “I had the largest golf magazine come into my booth and tell me, ‘You have the best putter here, but there’s no way my editor would run this,’â€? Mr. Ross said. “We’re referred to as the metal driver of putting. When the metal driver came out, people said, ‘No way I’m using this.’ And everyone does now.â€? â–

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AWARDS 3M: Abraham Joy and Xiong Gong (University of Akron) received 2011 Nontenured Faculty Awards. NATIONAL COUNCIL FOR COMMUNITY BEHAVIORAL HEALTHCARE: Nelson W. Burns (Coleman Professional Services) received the 2011 Visionary Leadership Award. PUBLIC RELATIONS SOCIETY OF AMERICA, GREATER CLEVELAND CHAPTER: Beth Hallisy (Marcus Thomas) received the 2011 Lighthouse Award.

Send information for Going Places to dhillyer@crain.com.

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INSIDE

17 CONTINUING EDUCATION MAKING A COMEBACK.

13

HIGHER EDUCATION HAVING A FIELD DAY

“The experience that I’ve gotten here, it’s invaluable.” – Amanda Mendelsohn (below), intern, Athersys Inc.

Some companies revive or expand beneficial internship programs By MICHELLE PARK mpark@crain.com

S

tudents, rejoice: While unemployment remains high, many Northeast Ohio employers hired more interns last year and expect to do the same this year. Consider the nearly 200% increase in the number of internships from 2009 to 2010 on NEOintern.net, a free database on which students can apply for internships and regional employers can post openings. There were 485 postings last year compared to 166 in 2009, said Ann Womer Benjamin, executive director of the Northeast Ohio Council on Higher Education, or NOCHE, which manages the online database. Already this year, nearly 200 internships have been posted, and Ms. Benjamin expects the growth to continue, in part because of the greater competitiveness that exists in the job market today. “There is an increasing recognition of the importance of internships,” Ms. Benjamin said. “Increasingly, employers want people who have some kind of experience, even new college graduates.” She acknowledged that increased outreach and the centralization of the See INTERN Page 14

WORK IT Mayfield Village-based ERC and the Northeast Ohio Council on Higher Education have collaborated since 2009 to survey local employers on their internship pay rates and practices. While results are preliminary, about two-thirds of the roughly 100 survey respondents said they are hiring or plan to hire college graduates this year; one-third said they are not. Employers also were asked whether they plan to make any of the following modifications to their internship programs:

Answer

JASON MILLER

Number of Participants Percent

Increase number of interns

37

35.92%

Maintain number of interns

43

41.75

Reduce number of interns

4

3.88

Eliminate all interns

1

.97

Have not hired interns (in the past)

18

17.48

Total

103

100

Northeast Ohio colleges generate energy with upgrades By TIMOTHY MAGAW tmagaw@crain.com

Efficiency legislation helps spark green investments on campus

N

goal of reducing energy consumption by at least 20% by 2014, using 2004 as the benchmark year. Though the law doesn’t have the teeth to go after those that don’t adhere, it hasn’t stopped Northeast Ohio’s colleges and universities from shelling out millions of dollars to ensure their facilities are as green as possible, often going beyond what the state requires. Typically, the savings aren’t from fancy, new buildings armed

ortheast Ohio’s colleges and universities are taking strides to drastically reduce their energy consumption at the behest of legislation passed a number of years ago, and many already are realizing significant savings. The law — known as House Bill 251 — dictates that state-funded colleges and universities develop 15-year plans for implementing energy efficiency, with the ultimate

with the latest technology but rather the result of existing infrastructure that’s been overhauled. Lakeland Community College in Kirtland already has exceeded the expectations of the law and curbed its energy usage by 40%, according to Mike Mayher, the college’s vice president for administrative services and treasurer. The project cost Lakeland about $6.5 million, and it’s expected to save the college about $800,000 a

year through energy savings and other avoidable capital and maintenance costs. “When we moved forward on this, we didn’t do it to show off,” Mr. Mayher said. “We did it because it made economic sense. All of the stuff we’ve done drives down the bottom line and has a tremendous number of other benefits.”

A budding opportunity Of the changes made to Lake-

land’s campus, Mr. Mayher noted that it’s been mostly the “non-sexy stuff.” For example, the college has added extra insulation to the roofs on many of its buildings and installed building management systems that automatically regulate the lights and temperatures. “We still believe we can drive our savings down another 10% or 20%,” Mr. Mayher said. “The point is we’re not done yet. It’s a lot of little things that add up over time, and we need to keep investing.” Because of the slowing amount See ENERGY Page 16

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Intern: Experience enhances education, career potential continued from PAGE 13

internship site’s operations also may have contributed to the growing number of listings. The impact on internships of what until recently has been a sluggish economy seems varied. Some employers have hired interns to minimize costs and to augment lean work forces. However, other for-profit organizations have hired fewer interns or eliminated programs altogether, noted Marty Mordarski, director of research

and membership for ERC, an organization in Mayfield Village that provides human resources services. By contrast, the use of unpaid internships, particularly in the nonprofit sector, grew during the recession, he said. (The federal Fair Labor Standards Act restricts when for-profit private sector employers may employ and not pay interns. For one, interns may not displace regular employees.) ERC and NOCHE have collaborated since 2009 to survey local

employers on their internship pay rates and practices. This year’s findings haven’t been released, but preliminary results reveal that 36% of more than 100 responding employers plan to increase their intern numbers and 42% plan to maintain programs they’ve had. “We feel that the fact that internships have held steady and expanded is a sign that the economy is stabilizing or growing — although it’s hard to say for certain — because even during the recession, employers were continuing their internship programs,� said Katie Talarico, survey manager with ERC.

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According to a survey conducted by the National Association of Colleges and Employers, a Bethlehem, Pa., association that tracks the employment of those who are college educated, employers expect to hire 7% more interns during the 2010-2011 school year than they hired in 2009-2010. Of the employers responding to the association’s 2011 Internship & Co-op Survey, 93% said they plan to hire college

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students for internship positions, and most plan to pay them. In 2010, Sherwin-Williams Co. increased the number of students in its professional apprentice program to 41 from 28 in 2009. The company expects another increase in 2011, and it is considering a pay rate increase for apprentices this year, said Sygi Berman, human capital acquisition specialist at the Cleveland-based paintmaker. Half the internships posted to NEOintern.net are paid, and that’s been the trend over the last year, Ms. Benjamin said, noting the average hourly wage for internships is about $11. Some employers receive state and college subsidies to offset the cost of interns, she said. National Interstate Insurance Co. in Richfield is another local company with plans to increase its number of interns: This year, it intends to nearly double its Northeast Ohio intern number to seven from the four it had in 2010. The expansion is driven by business growth and the company’s acquisition of Vanliner Insurance Co. last July, said Dave Michelson, president and CEO. More internships in nonprofit management, social media, web design and sales are cropping up, Ms. Benjamin said. ERC officials also noted technical and nonprofit internships are on the rise. Ms. Benjamin also attributes internship increases to more local colleges and universities building internships into academic requirements and to the economy. Students are realizing they need experience to have a leg up in the increasingly difficult job market, she said, and employers who are reluctant to hire can utilize interns for a finite period of time while vetting them as potential employees. In addition, ERC has heard that organizations have struggled to find experienced workers who meet their business needs. “As a result, some have become more proactive in developing internship and emerging leaders programs that help them obtain and grow this type of talent,� Ms.

Talarico said. It is difficult, Ms. Benjamin said, to track how many interns are offered jobs and accept full-time positions with companies, though NOCHE urges employers to share such information. In 2010, more than half of Northeast Ohio employers responding to the last ERC/ NOCHE survey intended to offer full-time positions to their interns.

Drawing the benefits Amanda Mendelsohn, a Cleveland Institute of Art student, is not your typical intern. She already has a biology degree and she’s back in school studying to become a medical illustrator after nine years of research assistant work. Earlier this month, she was creating art of a brain for Athersys Inc., the Cleveland biopharmaceutical company for which she’s interning. Ms. Mendelsohn is not required to do internships, but does so to gain experience. There appeared to be more internship opportunities in 2010 than 2009, she recalled. “The experience that I’ve gotten here, it’s invaluable,â€? Ms. Mendelsohn said of Athersys. “Had I not had that coming out of school, I think it’d be hard to know what to expect and what’s expected of me.â€? Companies, too, gain from internships. “Our company has the advantage of a ‘long interview,’ affording us the opportunity to get to know the intern in a productive way and see if they are a good fit for our company’s culture,â€? said Mr. Michelson of National Interstate. Another benefit is “the spark — having fresh, young personalities engaging in our daily work,â€? said Adam Wagner, marketing manager for Go Media Inc. in Cleveland’s Ohio City neighborhood. The 12person graphic design service company plans to bring on board three unpaid interns this summer, up from the two it had last year. The community also benefits when students intern locally because it keeps jobs, taxes and talent in Northeast Ohio, Mr. Michelson said. â–

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HIGHER EDUCATION

More students sign on to convenient online courses Colleges say better technology, accessibility make it easier to improve, add offerings By CHUCK SODER csoder@crain.com

A

sk John Crooks who’s taking online courses these days, and he’ll give you a simple answer: “Everyone.” Colleges across Northeast Ohio have reported big increases in the popularity of online courses over the past few years. Among them is Lorain County Community College. More than half of the school’s 13,000 students — 6,753, to be exact — took at least one online class last fall, said Dr. Crooks, director of distance learning for the college. That’s up from 4,379 in the fall of 2008, a 54% increase. Why the continued growth, so many years after the emergence of the Internet? Though “early adopters” may have been willing to experiment with online courses years ago, now average students, faculty members and administrators have grown comfortable with them, too, said Dr. Crooks, who also is associate provost of LCCC’s University Partnership program. “You’ve seen that middle tier trying it,” he said. Better technology has helped

make online courses better, according to officials from several area colleges. Some cited the recession as a factor, too, noting that adults who have lost their jobs or want to become more marketable often find it easier to take courses online. Regardless of the reasons why, the “general consensus” is that demand for online courses is up and will keep growing, said Ann Womer Benjamin, executive director of the Northeast Ohio Council on Higher Education. “I think it’s the wave of the future. And the future is now,” she said.

Growth spurts Nationwide, the total number of students enrolled in online classes hit 5.6 million in fall 2009, a 21% increase from 4.6 million in fall 2008, according to the 2010 Sloan Survey of Online Learning. It was the biggest numerical increase since The Sloan Consortium, a professional organization focused on integrating online education into the mainstream of higher education, and the Babson Survey Research Group began tracking the statistics in fall 2002.

Some area schools have seen even bigger percentage increases lately. At Cuyahoga Community College, online enrollment hit 11,600 in 2010, a 37% increase over 2009, said Christina Royal, associate vice president of eLearning and Innovation. Enrollment grew by 34% in 2009 and 27% in 2008, she added. One factor driving the increase is that technology is “much more ubiquitous” today than it was five years ago, Dr. Royal said. She also cited the recession as a reason for increased enrollment, adding that growth may slow down as the economy recovers. “At some point the growth rate has to slow down,” she said. There’s still a lot more room for growth, though, according to Pete Rottier, director of the Center for eLearning at Cleveland State University. As of January, Cleveland State students were taking about 49,000 credit hours via the Internet, which amounts to 33% of all credit hours being taken at the university, Dr. Rottier said. The figure — which includes “blended” courses that involve some classroom time, though not as much as traditional courses — is up from 37,000 in fall 2009, 28,000 in fall 2008 and 21,000 in fall 2007, he said. Online sections of general education courses at Cleveland State “fill instantly,” Dr. Rottier said.

“I think it’s the wave of the future. And the future is now.” – Ann Womer Benjamin executive director, Northeast Ohio Council on Higher Education “We’re not even close to filling demand just for those types of courses,” he said. Lorain County Community College wants to add more courses for specific majors, though Dr. Crooks noted that many students still want to spend some time in the classroom when taking those courses to develop relationships with their instructors. “They want their major courses in a face-to-face environment,” he said. Another factor limiting the growth of online courses is the perception that they aren’t as effective as traditional classes, said Tri-C’s Dr. Royal. She noted, however, that a growing number of colleges are seeking Quality Matters certification, a peer review process started by a consortium of colleges and universities aiming to give the public confidence in the quality of online education.

Realistic expectations New technology also has made it possible for instructors to teach online courses in much the same way that they would teach traditional classes, said Deborah Huntsman,

executive director for the Office of Continuing and Distance Education at Kent State University. Kent State is in the process of upgrading its Blackboard education software to a version that will allow an instructor to establish a real-time audio and video connection with students, allowing them to have face-to-face conversations via the Internet, Ms. Huntsman said. The software, which is “not inexpensive,” also lets instructors show students slides and other documents via the web, she said. Students enrolled at Kent State’s eight campuses today fill about 18,000 “seats” in about 350 online courses, Ms. Huntsman said. That’s up from about 12,000 in 2010, a 50% increase. University officials have said that one day they want to offer online sections for all Kent State courses, she said. That may not be achievable, but online enrollment should continue to expand, she said. The university also aims to start offering more hybrid courses that integrate elements of traditional and online classes. “We’re about ready to make that shift,” she said. ■

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HIGHER EDUCATION

Energy: Universities tout environmental benefits, savings continued from PAGE 13

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of state dollars being funneled into universities and colleges, general maintenance often had been delayed. But when House Bill 251 was enacted, it offered many schools the opportunity to tackle those maintenance issues while simultaneously making a concerted effort to lower rising energy costs. Another piece of legislation allowed universities to borrow funds and pay them back with the recouped energy savings. Cleveland State tackled its aging campus with a recently completed two-year project at a cost of $43 million that aims to capture a 40% reduction in energy consumption. The project is estimated to save as much as $62.9 million in energy costs through 2021, and after paying off the bonds and other overhead costs, the project will net the university about $6 million in additional cash flow in that time period. Over the last two years, Cleveland State replaced about 800 pieces of equipment throughout its campus. Some of the updates included installing LED lighting fixtures and new HVAC systems. “When people were getting into these opportunities, we saw how large the scale was,” said Nathan Engstrom, Cleveland State’s sustainability coordinator. “There were opportunities all around the campus.” Still, the return on investment isn’t always immediate, according to Ted Curtis, the University of Akron’s vice president for capital planning and facilities management. The payoff often can take anywhere from 10 to 20 years. “To me, an eight- to 10-year payback would be the least you’d

have to look at,” Mr. Curtis said. “Anything over that, it saves energy, it’s green, it receives awards, but is it a good investment of taxpayer dollars?”

Outlying benefits Many say the answer to that question is a resounding “yes.” Officials said that operating expenses are a large chunk of their schools’ finances, and slowing their growth ultimately translates into savings for students. “Our aggressive energy conservation initiative is one of the reasons we’ve been able to hold down our tuition costs over the years,” said Tom Euclide, university architect at Kent State. Kent State is in the midst of several energy conservation projects, including outfitting its residence halls with the latest energy savings equipment and updating buildings on its regional campuses. The residence hall project is expected to cost as much as $20 million, but it is estimated to save 37% in energy costs. The energy savings are expected to pay for the project, and if the savings aren’t met, the contracting company — Brewer-Garrett in Middleburg Heights — is responsible for paying the deficit. In the residence halls, the university, for instance, is replacing single-pane windows with thermal windows. Additionally, BrewerGarrett proposed installing a wireless technology — controllable by a computer or smart phone — that allows students and staff to automatically or manually turn off lights or manage the temperature. “They’ve come up with some really bold ideas that are going to give us enough payback,” Mr. Euclide said. ■

IN BRIEF Entering a new chapter Kent State’s new digital laboratory enables students to archive books, other information Students in the Kent State University School of Library and Information Science are getting hands-on experience with digital library and digital preservation technologies thanks to a new digital laboratory. The new digital laboratory has the capability to digitize manuscripts, books, photographs and slides, architectural drawings and other larger format visual materials, as well as more than 20 audio and video formats. Digitization is the conversion of analog information into digital information, which makes the data accessible online. LOOKING TO LAUNCH?: Shaker LaunchHouse, a business incubator/ accelerator, and Cleveland State University’s Nance College of Business are hosting a business idea competition that aims to foster the entrepreneurial skills of the region’s students.

The competition is open to students from any Northeast Ohio college or university. Students pitch business concepts to a panel of entrepreneurs, venture capitalists, Cleveland State University business faculty and staff from Shaker LaunchHouse. Finalists will make a two-minute pitch on May 5 at Shaker LaunchHouse in Shaker Heights. The winner will receive a $2,500 scholarship to Cleveland State’s Global Accelerated MBA program along with support services from LaunchHouse, including an initial $1,000 investment, incubation space, legal support, accounting support and business planning assistance. They also will have the opportunity to compete for up to $5,000 in additional funding. Students from any discipline may submit their ideas at www.csuohio. edu/business until noon April 25. The judges will seek ideas related to software and innovative technology solutions but will consider other opportunities as well.

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Continuing ed programs revive, revise with times By TIMOTHY MAGAW tmagaw@crain.com

N

ortheast Ohio students slowly are starting to return to noncredit, continuing education courses that took a hit during the recession, and uncertainty at one local program may even mean that other higher education institutions have the opportunity to snag more of the recovering market. Enrollment in Cleveland State University’s continuing education programs plummeted by as much as 40% between 2008 and 2009 as employers stopped footing the bill for such programs. Enrollment started to improve in fall 2010, but it has yet to rebound to prerecession levels. “We’ve seen an uptick compared to when things were really bad when the economy went into sort of a free fall,� said Barbara Hanniford, dean of continuing education at Cleveland State. “Companies are beginning to feel better about spending money for employee development and training.� Cleveland State recently announced it was closing its continuing education division in June to save money and adhere to the university administration’s preference for a different organizational model. Though some of the department’s existing courses will be transferred to other academic divisions, the breadth of courses to be offered hasn’t been determined. And depending on the outcome, it certainly could spur other institutions to pick up the slack. Dr. Hanniford said that largely depends on which courses Cleveland State continues to offer and whether they’re marketed properly to lure in prospective students. Baldwin-Wallace College in Berea, for one, said it was looking at what happens with the Cleveland State program. Though there currently isn’t much overlap between the programs at BaldwinWallace and Cleveland State, adding additional programs might be worth looking into, according to Donna Van Rooy, director of professional development at

Baldwin-Wallace. “I’d have to do the business case for it, but it’s not out of the question,� she said.

Changing dynamics At Baldwin-Wallace, enrollment in the college’s leadership program, which falls into the continuing education category, slowed during the recession, but it has been picking up. Although not as many students are traveling to campus for courses, the college is seeing an uptick in the number of companies signing up for on-site development programs. “I’ll tell companies that if they have at least 12 people who have that need, it’s better to bring it on-site for a few reasons,� Ms. Van Rooy said. On-site programs are more cost effective, customizable to an individual company’s needs and offer a more flexible schedule, she said. Many professional development programs also are moving online, said Stanley Silverman, dean of the University of Akron’s Summit College, which offers continuing education programs. For instance, the college’s wedding planning certificate can be earned online. “There are some predictions (that) by 2020, almost all noncredit courses will be online,� he said. Meanwhile, there are several onetime courses interested parties can take regardless of their professional ambitions. The University of Akron offers a course on golf and Cuyahoga Community College offers a course on how to make a quiche. Enrollment in these types of courses has remained relatively strong, college officials say. John Carroll University, however, scaled back its continuing education program over the last few years because of stagnant participation, but there has been some renewed interest. “Our continuing ed office used to be a lot broader,� said Deanna DePenti, the college’s continuing education coordinator. “Over the years, it has been shrinking, but we’re in talks with some other departments in trying to get back those audited or experiential learning

PHOTO PROVIDED

Veronica Phillips gives a presentation in a health care executive leadership class at Baldwin-Wallace College. courses — the things that might be of interest to those in the community.� Ms. DePenti said she frequently hears from people in the community who would like to sit in on literature courses. Some of the other courses the college may offer

include courses on religious studies and philosophy.

Readying the work force Still, it’s not all about learning for the sake of learning. Many professionals want to buckle down to advance their careers, and many

of Northeast Ohio’s colleges are responding to meet that need. Baldwin-Wallace last fall started offering a health care executive program, given the changing nature of the industry and the demands facing the work force. “With changes going on in that arena, people who have had a clinical mindset will learn some of those business principles they need to apply,â€? Ms. Van Rooy said. Over the next year or two, Cuyahoga Community College is planning to ramp up its offerings for those interested in brushing up their IT skills, according to Susan Muha, the college’s executive vice president for work force development. The short, one-day courses might be for professionals looking to enhance their basic computer skills or learn a new piece of software. “The demand is out there very much for compressed format courses that are six or eight hours,â€? she said. “Many of us are skilled, but we need to know one component of something in order to do our job better or to understand something. We don’t have 40 or 60 hours to do it.â€? â–

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HIGHER EDUCATION

Visiting professors elevate learning experience Executives, researchers introduce new kind of expertise to classroom By DAN SHINGLER dshingler@crain.com

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ot all college professors want tenured positions that cement them to one university. Some just like to stop by a school for a week, a semester or maybe even a few years, to teach or conduct research — and then go on their way to another university, retirement or even another profession entirely. But the schools that host these professors say they are sometimes among the most valuable faculty around. This spring, for example, students at Oberlin College will be learning from former Washington, D.C., Mayor Adrian Fenty, who is the youngest person ever elected mayor in the nation’s capital. Mr. Fenty lost his re-election bid this fall —

but not his ability to convey some valuable life lessons to students, according to the school. “It does a lot for Northeast Ohio when we can bring these folks in, especially in areas such as business” where their experience can help students connect concepts to the real world, said Tim Chandler, senior associate provost at Kent State University. Dr. Chandler is referring to visiting professors — or “adjunct professors,” depending on the school — and they tend to be from one of two groups. The first already are professors at other universities who choose to spend their sabbaticals at another school, where they can collaborate with other researchers on specific projects. Sometimes they also teach a class or two, but not always. Visiting professorships allow for out-of-town researchers to work side by side with those locally, sharing ideas and advancing each other’s work, Dr. Chandler said. Often, this happens without the general public even knowing of it — though the graduate and

doctoral students in the department being visited are sure to be aware. “Then there are the superstars — they have tremendous knowledge and experience they can share with the students, but they don’t want to be full-time professors,” said Robin Dubin, associate dean for graduate and professional studies at Case Western Reserve University’s Weatherhead School of Management in Cleveland.

Star power The superstars tend to be made up of successful people from nonacademic fields. They choose to teach classes during either a break from their careers or in retirement, often at their alma maters. They might be business tycoons, artists, doctors or even prominent politicians. Both types of visiting professors have their benefits for students and other faculty members alike, said Sean Decatur, dean of arts and sciences at Oberlin College, where former D.C. Mayor Fenty, a 1992 Oberlin alumnus, will be a

distinguished visiting professor of politics. According to a news release from the school, Mr. Fenty will participate in a politics course this spring, and in the fall he is slated to co-teach with Oberlin professor Paul Dawson an introductory course on American politics, which focuses on the relationship between politics and public policy. Dr. Decatur said Mr. Fenty is exactly the kind of person whose experience can benefit students. “It allows students to make a connection between their classroom work and what happens outside the walls of campus,” Dr. Decatur said. The use of visiting professors also allows universities to bring in highly specialized scholars who can teach courses on relevant contemporary topics. For example, both Oberlin and Case Western Reserve University are using visiting professors to teach courses on the recent financial crisis. Oberlin has former County Cuyahoga County Treasurer Jim Rokakis teaching a course on how the foreclosure debacle struck Cuyahoga County, while Case Western Reserve has a visiting professor from the Federal Reserve Bank of Cleveland teaching business students a course on the broader financial crisis that led to the recent recession.

Beneficial arrangement The short-term teaching stints also allow the schools to save money — or sometimes to avoid long-term headaches. Visiting professors on sabbatical, for example, often have half their salary paid by their home universities. And, when a school is looking to hire a professor permanently, some first will try out the prospect as a visiting professor. “If you are making a very senior hire, frequently you’ll bring that person in as a visitor to see what the impact will be on the rest of the department and its faculty,” said Ned Hill, dean of Cleveland State University’s Maxine Goodman Levin College of Urban Affairs.

At the same time, Cleveland State is leveraging its relationships with universities in China to facilitate transglobal research by bringing in professors to work with their local peers on research projects, he said. Visiting professors also often are less expensive, even if they are not on a paid sabbatical, said Oberlin’s Dr. Decatur. They sometimes work for the minimum teaching salary — which can be far less than they made in the private sector. Often, the motivation is to help their alma maters, Dr. Decatur said. Another thing some colleges like about visiting professors is that, depending upon how the school is set up, the positions can be totally market driven. In other words, the visiting professors might be able to teach at a university for more than a couple of semesters, or even for many years — but only if they interest students enough. “If that class does not get sufficient enrollment, then that person is not rehired. It’s that kind of a contract,” Dr. Dubin said. Many also work part time and are paid based on the number of courses they teach — rather than for publishing research — which also affords the school some savings and flexibility. “You can have smaller classrooms as a result, because you can hire more teachers,” Dr. Dubin said.

Beyond the ivory tower If there’s a downside to visiting professors, it might be that they often come on short notice, and sometimes stay for shorter periods of time than a school might want. At Kent, for instance, some visiting professors stay for just one week — taking over a portion of a regular class from a full-time professor. The trick, said Kent State’s Dr. Chandler, is to be prepared for them and to be willing to incorporate them into even an ongoing class. It’s worth it, said Dr. Chandler and others, because schools realize they have to increasingly broaden the exposure they offer students. Universities used to insulate themselves, and too often their students, from the rest of the world, he said. “We cannot do that anymore,” he said. “We’ve got to help our students connect beyond the ivory tower.” ■

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APRIL 18 - 24, 2011

BRIGHT SPOTS It’s not all bad out there. Here’s the latest installment of a weekly web feature that highlights positive developments in the Northeast Ohio business community. ■ The Sausage Shoppe, a meat processor and retailer at 4501 Memphis Ave. in Cleveland, won two awards last month at the Ohio Association of Meat Processors convention in Columbus. Reserve Grand Champion is the award The Sausage Shoppe received for its restructured jerky, with an entry of its original recipe Beef Jerky. The Sausage Shoppe said the jerky “is judged based on external

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appearance, internal appearance and texture, aroma, flavor and texture and mouthfeel.” It’s the 17th state or national award for this product, according to the meat merchant. The Sausage Shoppe also placed first in the Innovative Products class for its Spicy Cheddar Kielbasi. “This class is judged based on appearance and presentation, feasibility to manufacture, aroma, flavor and texture, and being an innovative idea within the meat industry,” The Sausage Shoppe said. Its Spicy Cheddar Kielbasi “is a combination of lean beef and pork, Italian spices, and a blend of fine and coarse shredded cheddar cheeses,” it said. ■ Sideways Inc., a Cleveland company that turns books, magazines

and other publications into multimedia experiences on mobile devices, and the Rock and Roll Hall of Fame and Museum last week released the first Rock Hall app for the iPad and iPhone. The app is a showcase of the “Songs That Shaped Rock and Roll” interactive exhibit. The songs, selected by the museum’s curatorial and education staff as well as rock critics and historians, chart the evolution of rock ‘n’ roll since the 1920s. The app sells for $1.99 in the iTunes store. Sideways said the app features more than 600 songs and includes a slide show that users can swipe through to experience the music from a specific decade between 1920 and 2006. Once a decade is selected, the app features an album cover slideshow to scroll through

and select music. Users then can play the song sample from iTunes, purchase the song or add it to a custom play list contained within the app. The app “allows our visitors to take a piece of the museum home and at the same time shares the experience with music lovers who haven’t had the opportunity to visit,” said Todd Mesek, vice president of marketing and communications at the Rock Hall, in a statement. He added, “While this is our first foray into apps, down the road we hope to develop others with different themes.” Eliza Wing, founder and president of Sideways, said the app “was a great, fun opportunity to showcase some of the best music of all time.” ■ Sales of new cars and trucks in Northeast Ohio increased 33% in

19

March compared with the like month of 2010, according to statistics released by the Greater Cleveland Automobile Dealers’ Association. “While we were expecting an increase in sales due to pent-up demand in the marketplace, these figures also represent a nice bump in business, which is due in part to the increase in traffic we saw at the Cleveland Auto Show this year,” said Louis A. Vitantonio Jr., president of the auto dealers group, in a statement. Consumer traffic at the Cleveland Auto Show was up more than 13% this year, according to the GCADA. The top-selling Northeast Ohio brand is Chevrolet, which saw an increase of more than 78% to 3,705 sales in March from 2,080 sales in March 2010.

LARGEST INVESTMENT ADVISERS RANKED BY ASSETS UNDER MANAGEMENT LOCALLY(1)

Company Address Rank Phone/Web site

Total assets under management locally (millions) Dec. 31, 2010

Dec. 31, 2009

% change

Total number of local accounts

Minimum individual Portfolio account analysts on (thousands) staff Compensation for services

Chief investment officer

Fee based on assets under management and Gordon B. Fowler Jr. strategies employed

Top local executive

1

Glenmede Trust Co. 25825 Science Park Drive, Suite 110, Beachwood 44122-7315 (216) 378-2900/www.glenmede.com

$2,493.8

$2,255.7

10.6%

1,788

$3,000.0

6

2

Lincoln Financial Advisors/Sagemark Consulting 28601 Chagrin Blvd., Suite 300, Cleveland 44122 (216) 765-7400/www.lfa-sagemark.com

$2,059.3

$1,927.7

6.8%

4,218

NA

NA

Fee and commission

Tim Johnson Ben Huddle

John DiMonda managing director

3

Paragon Advisors Inc. 20820 Chagrin Blvd., Shaker Heights 44122 (216) 491-3990/www.paragonadvisors.net

$2,000.0

$2,500.0

-20.0%

30

$15,000.0

10

Fee only

Terence C. Sullivan

NA

4

Stratos Wealth Partners 30575 Bainbridge Road, Suite 100, Solon 44139 (866) 553-9882/www.stratoswealthpartners.com

$1,840.0

$1,100.0

67.3%

22,354

$1.0

3

Fee, commission, % of assets under management

Daniel Jacoby

Jeffrey Concepcion CEO

5

MAI Wealth Advisors LLC 1360 E. Ninth St., Suite 1100, Cleveland 44114 (216) 920-4800/www.maiwealth.com

$1,647.0

$1,321.5

24.6%

464

$500.0

11

Fee only based on assets under management or set fee for non-investment services

Gerald H. Gray

Richard J. Buoncore managing partner

6

Cedar Brook Financial Partners 5885 Landerbrook Drive, Suite 200, Cleveland 44124 (440) 683-9200/www.cedarbrookfinancial.com

$1,540.0

$1,420.0

8.5%

NA

$0.0

5

Negotiated

Randy Schneider Peter Franz

Azim Nakhooda managing principal

7

Rehmann Financial 1340 Depot St., Suite 205, Rocky River 44116 (440) 356-4520/www.rehmannfinancial.com

$1,450.0

$675.0

114.8%

4,200

$250.0

6

Fee or commission

Jeffrey Phillips

Joseph P. Heider managing principal

8

CBIZ Financial Solutions, Inc. dba CBIZ Retirement Plan Services 6050 Oak Tree Blvd. S., Suite 500, Independence 44131 (216) 447-9000/www.cbiz.com

$1,207.4

$1,049.9

15.0%

141

$1,000.0

NA

Fee, commission and percentage of assets under Brian Dean management

Luke F. Baum president

9

NCA Financial Planners 6095 Parkland Blvd., Suite 210, Cleveland 44124 (440) 473-1115/www.ncafinancial.com

$965.3

$822.6

17.3%

2,500

$250.0

14

Percentage

Kevin H. Myeroff president, CEO

10

CM Wealth Advisors Inc. 30195 Chagrin Blvd., Suite 250, Pepper Pike 44124 (216) 831-9667/www.cmwealthadvisors.com

$936.0

$784.1

19.4%

72

$2,000.0

NA

Percentage of assets under James W. Wert management, fixed fees

James W. Wert president, CEO

11

Fairway Wealth Management LLC 6393 Oak Tree Blvd., Suite 108, Independence 44131-6958 (216) 573-7200/www.fairwaywealth.com

$624.7

$575.0

8.6%

100

$2,000.0

4

Fee only, based on assets and/or scope of services

Mark S. Weiskind

Daniel R. Gaugler CEO, managing director

12

Beacon Financial Partners LLC 25800 Science Park, Suite 200, Beachwood 44122 (216) 910-1850/www.beaconplanners.com

$503.0

$420.0

19.8%

2,127

NA

1

Fee and commission

Dale Rubin

Gregory G. Randall managing partner

13

Sequoia Financial Group LLC 121 S. Main St., Suite 300, Akron 44314 (330) 375-9480/www.sequoia-financial.com

$437.6

$291.8

50.0%

1,500

$0.0

2

Percentage of assets under management, fee and Thomas A. Haught commision

Thomas A. Haught president

14

MGO Investment Advisors Inc. 1301 E. Ninth St., Suite 1400, Cleveland 44114 (216) 771-4242/www.mgo-inc.com

$408.3

$341.5

19.6%

1,920

$15.0

3

Percentage of assets under Michael Bradford management Moskal

Michael Moskal president

15

Inverness Holdings LLC One Chagrin Highlands, Suite 440, Beachwood 44122 (216) 839-5130/www.invernesswealth.com

$400.0

$350.0

14.3%

300

$750.0

10

Fee and commission

Jeffrey van Fossen

Richard B. Renner principal

16

Cornerstone Capital Advisors 1507 Boettler Road, Suite G, Uniontown 44685 (330) 896-6250/www.ccadvisors.com

$322.6

$264.3

22.1%

930

$100.0

2

Fee only

Mario C. Giganti

Mark W. Fearigo principal, trusted advisor

17

McDonald Partners LLC 959 W. St. Clair Ave., Suite 300, Cleveland 44113 (216) 912-0567/www.tmpfa.com

$282.1

$110.2

156.0%

943

NA

2

Fee and commission

William Hegarty

Thomas McDonald president, CEO

18

Scott Snow (financial advisors) LLC 24601 Center Ridge Road, Suite 175, Westlake 44145 (440) 871-7669/www.s2fa.com

$233.0

$210.0

11.0%

55

$1,000.0

2

Fee only

Scott P. Snow

Scott P. Snow managing director

19

Aurum Wealth Management Group LLC 6685 Beta Drive, Mayfield Village 44143 (440) 605-1900/www.aurumwealth.com

$158.0

$140.0

12.9%

86

$1,000.0

1

Fee only

NA

Christopher D. Bart, Eric N. Wulff, managing directors, principals

Dennis P. Lehman

Source: Information is supplied by the companies unless footnoted. Crain's Cleveland Business does not independently verify the information and there is no guarantee these listings are complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. Individual lists and The Book of Lists are available to purchase at www.crainscleveland.com. (1) Companies that are registered with the SEC as investment advisers but do not have full control over where their clients’ money is invested are included in the Investment Advisers list. This criteria is in keeping with the standard used by our sister publication, Pensions & Investments.

Frank I. Harding, III managing director, director of the Ohio office

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Christian: Goals oriented toward helping others continued from PAGE 1

A free man for two-and-a-half years, Mr. Christian, 55, is seeking to put what he sees as his strengths as a business person — in particular, an ability to cultivate innovation — to use in two ventures. One, called the Number 12 Foundation, is a nonprofit that Mr. Christian says has the mission of “saving lives and families from the disease of alcoholism and addiction by building bridges to lasting recovery.” The other, a consultancy called Revenue Beast, is in Mr. Christian’s old wheelhouse, as it focuses on accelerating revenue for clients. Both are run from a Beachwood office building that shows its age and is a far cry from Mr. Christian’s fancy former Christian & Timbers office, which, he notes a couple times, had a private bathroom. Unlike the carefree days of money and media attention, Mr. Christian during the conversation last week expressed considerable nervousness about how he would be portrayed in this story. He has three boys, ages 14, 11 and 9, now central to his life, “and they’ve been hurt a lot,” he says. The kids are at sensitive ages, Mr. Christian says, and he worries that fresh attention to his past might hurt them more. Mr. Christian, who got divorced in 2004 from his wife, remarried her in February 2010. He says he now has “a different kind of life,” one that involves going home after work, cooking dinner and helping

the boys with their homework. But, as a recovering addict, Mr. Christian is mindful about not taking anything for granted. “I’m absolutely not a saint,” he said. “I try to do the right thing now. But I’m very human. I want to get my way. I’m stubborn. I take each day slowly. I have a need to make up for things.”

Step by step In prison, Mr. Christian said, he began thinking seriously about his life and how he might contribute to society upon his release. He had struggled, on and off, with addiction since about the age of 35, and almost everyone he met in prison had a problem with drugs, alcohol or both. It made sense, Mr. Christian said, to direct his energies toward an organization that seeks to bring about meaningful recovery. Mr. Christian lost much of his wealth as a result of his legal problems and prison stay, but he said he had enough left to fund the Number 12 Foundation with about $100,000. That money enabled the foundation to open a Number 12 halfway house in Kent in 2009 and, in spring 2010, a prison program at the Marion Institutional Correctional Institute that has “graduated” 62 inmates. Last month, the foundation launched a second prison program, at the Richland Correctional Institution in Mansfield, which has 40 participants. Mr. Christian said he sees the foundation’s role as addressing gaps

TRACKING JEFF CHRISTIAN 1980: Christian & Timbers founded. The executive search firm steadily rises to national prominence under Mr. Christian, its president. 1999: The company makes waves by assisting in Carly Fiorina’s hiring at Hewlett-Packard; Ms. Fiorina was the first female CEO of a major computer company, and joined a short list of females leading Fortune 500 outfits. 2003: Mr. Christian sells his stake in Christian & Timbers. December 2006: Mr. Christian indicted on reckless homicide and involuntary manslaughter charges surrounding the death of 31-year-old Thomas Wasil. Mr. Wasil’s brother says the death certificate showed that exist in treatment centers, detox centers, jails, prisons and probation departments. He said the foundation’s program augments the traditional 12-step recovery program of Alcoholics Anonymous with an emphasis on “getting participants to help others as soon as possible.” Cuyahoga County Common Pleas Judge David Matia, who serves as the judge for the Cleveland and Cuyahoga County Drug Court, invited Mr. Christian in February to address graduates of the year-long Drug Court program aimed at reducing recidivism rates. Judge Matia said Mr. Christian “hit it out of the park” with his address, which laid bare the pain

cocaine, acute heroin and ethanol in his brother’s system. April 2007: The family of Mr. Wasil files civil lawsuit in Portage County Common Pleas Court. July 2007: Mr. Christian pleads no contest to reckless homicide and is found guilty. “He was partying with people, and bad things happen when you party with people and drugs,” one of his attorneys, Jerry Gold, said at the time. “Under the criminal law, if you contribute in any way, you’re responsible. It was a hard situation.” October 2007: Mr. Christian sentenced to three years in prison. “I am truly sorry for the harm I have caused

by my irresponsible behavior,” he said at the sentencing hearing. October 2008: Released from prison. Spring 2009: Mr. Christian forms the nonprofit Number 12 Foundation. He says its mission is “saving the lives of addicts and their families’ suffering from the disease of alcoholism and addiction by building bridges to lasting recovery.” Summer 2010: Mr. Christian launches the for-profit Revenue Beast, which bills itself as finding “the most innovative ways to increase client revenue.”

caused by his addictions. “Jeff’s doing the right things to stay sober and help others,” Judge Matia said of the Number 12 Foundation’s work. “Here’s a guy who was at the top of the mountain and not only fell down, he fell off. … Your ego can get you in trouble. Jeff definitely knew all about that.” In conversation, Mr. Christian is quick to cite data that he said backs up the need for organizations such as the Number 12 Foundation. Addiction, he says, costs society “close to half a trillion dollars per year,” about $300 billion of that in health care costs alone. The United States has less than 5% of the world’s population but about 25% of its prison

population, which he said is partly a reflection of the country’s massive untreated drug problem. Mr. Christian said the four staff members of the foundation and volunteers who work on its programs spend much of their time monitoring the progress of people who started Number 12 Foundation initiatives in prison and now are trying to keep clean on the outside. “The goal is that they start to have a life of recovery in prison … and when they leave, we wrap our arms around them,” he said.

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APRIL 18 - 24, 2011

Christian started Revenue Beast last year. He says he splits his time evenly between the foundation and the for-profit business. He doesn’t have a lot of patience or inclination to do traditional nonprofit fundraising or grant writing, so he uses about 20% of the revenue generated by Revenue Beast to cover the foundation’s operations. Mr. Christian declined to provide specific revenue figures for Revenue Beast, but said it’s growing quickly and is “funding Number 12 and providing some limited income to me.” In a reflection, perhaps, of their symbiotic relationship, Revenue Beast shares in its goals some of the language of recovery used by the Number 12 Foundation. Revenue Beast’s web site, for instance, promises a “5-step formula” for revenue growth: discovery, identifying revenue accelerators, branding, “productizing” and “constructing the recurring revenue platform.” With Revenue Beast, Mr. Christian clearly has some aspirations to get back into a big-time business operation. In the last two months, for instance, Mr. Christian has issued news releases commenting on topics as diverse as the political turmoil in Egypt and nationwide trends in CEO compensation. Simon Clark, managing partner at Clark Langdon Partners, a boutique executive search firm based in Monaco, says he has been working with Mr. Christian and Revenue Beast for about six months. He hadn’t heard of Mr. Christian before last summer, when he read “The Headhunter’s Edge,” a book Mr. Christian wrote in 2002. Impressed by the book’s advice and in need of help in growing Clark Langdon, Mr. Clark turned to the Internet to make contact with the author. He wasn’t dissuaded by Mr. Christian’s legal problems; Mr. Clark, 35, said he was an alcohol and drug addict who entered AA and has been sober for eight years. “It just inspired me to give him a call,” Mr. Clark said. “We started sharing some experiences. … What happened to Jeff is what happens to addicts. It didn’t faze me.” Mr. Clark said Clark Langdon’s work with Revenue Beast “has helped us upscale the business” by establishing practice areas focused on CEO and board searches, refining its web site and sharpening the firm’s branding strategy. “We work together quite a lot,” he said, though that work is done via Skype and video or conference calls. Mr. Christian sees his work at Revenue Beast as primarily about helping clients create “screaming brands” that are “incredibly compelling” to potential customers.

Human nature At the Number 12 Foundation and Revenue Beast, one of the few visible vestiges of Mr. Christian’s former business life is the table — a bit nicked up, to be sure — that he used at his former Christian & Timbers office. He addresses his drug and alcohol background head on, but otherwise doesn’t care to dwell much on the past. Without going into detail, Mr. Christian said he has “made amends” with many people, though in some cases that’s not possible. He’s heartened by the general response he receives from people he works with or sees socially. “People have been really, really supportive,” he said, though he’s knowing enough to note, “What are people going to say to your face?” ■

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ER: Primary care doctor shortages a concern continued from PAGE 1

“(Health care reform) is not going to minimize the volume in the emergency department because there are not enough doctors to serve the 32 million additional people who are going to have insurance,” said Thomas Selden, president and CEO of Southwest General Health Center. “They’re going to seek care, and they’ll have insurance rather than a ‘please-don’t-charge-me’ card. They know a hospital will see them.” Southwest General converted its urgent care clinic in Brunswick to a 24-hour emergency department in 2009, and ultimately built a new ER facility for the location. It’s a move hospitals officials thought would alleviate the pressure facing its emergency department at its main Middleburg Heights campus; that ER was built to absorb 35,000 patients annually and now serves as many as 50,000. Though business at the new emergency room has thrived, it hasn’t relieved the pressure at Southwest’s main campus, Mr. Selden said. “We hoped the new one (in Brunswick) would pull off some of that capacity, but it was all new volume for us,” he said. So, the health system plans to build a new emergency room on its main campus. Though the plans are in their infancy, the hope is to break ground next spring.

“In emergency medicine, they always say, ‘If you build it, they will come,’ and they sure did.” – Barb West, administrative director of emergency services, MetroHealth said 99,671 patients visited the emergency department last year.

First impressions count Still, it’s not all about capacity concerns. Keeping an emergency room fresh and modern has become a vital part of doing business in Northeast Ohio’s competitive health care market. Hospital officials say patient perception of past ER visits is a strong indicator of whether they’ll return for future care. So, not only are the health care systems investing in better workspaces for the present, but also in their futures, too. “It definitely affects how they view the hospital,” said Dr. Michelle Blanda, chair of emergency services at Summa Health System. “First impressions are lasting impressions.” The Cleveland Clinic recently upgraded its emergency department at Hillcrest Hospital in Mayfield Heights as part of a $163 million campus upgrade and will do the same at Fairview Hospital on Cleve-

land’s West Side as part of a $76 million investment there. Officials at both hospitals said the renovations will allow them to see more patients and will improve the patient experience. But hospitals don’t necessarily need a wrecking ball to bolster consumer approval. MetroHealth retooled some its ER operations to boost efficiency. Now, with a portion of the ER waiting room left unoccupied, the health system plans to use some of that space to build three new clinical rooms for its ER, a nurse’s station and an office — a project expected to cost $300,000 to $350,000.

Beyond the mothership Not all of the bricks-and-mortar work to create more ER space is taking place in traditional hospital settings. Like Southwest General, other health systems are building freestanding emergency departments in other locations. This push comes as many health systems look to

offer patients convenient sites away from their main campuses — a move that helps lure more patients away from competitors. “We look at where we want to go from a market standpoint, where we want to get our patients in the community and where they need to have a better ability to access our health system,” said Brant Russell, vice president of clinical and support services at Summa Barberton and Summa Wadsworth-Rittman hospitals. In Twinsburg, both University Hospitals and the Clinic are building facilities with 24-hour emergency departments. The Clinic also is constructing a $96 million, 180,000square-foot health and surgery center in Avon — slated to open in December — that will offer primary care services, specialty services and a 24-hour emergency room. And Summa is building freestanding emergency departments in Green and Medina, for which the system will hire a total of about 90 employees to staff both locations. The Medina site, for one, will allow Summa to tap into a growing market. It opened a health center in the region last fall, and physicians and the community clamored for a local ER. ■

Easing the crunch University Hospitals’ emergency department at its main campus was built in the late 1970s to serve about 40,000 patients annually. However, patients without health insurance increasingly are using emergency departments for primary care and the number of patients far has exceeded what the ER was meant to handle. To meet that demand, University Hospitals is building a $40 million center for emergency medicine at Case Medical Center on Euclid Avenue. At present, UH’s emergency department annually serves 73,000 patients a year; the new one should accommodate more than 80,000. “I hope we’ve built it efficiently, so we can downsize it as we need to,” said Dr. Fred Rothstein, president of UH Case Medical Center. “We don’t have to use every room that’s there. We could certainly use it for other things if we needed to. But that’s not why we did it, but rather to offer the best environment for care, so we can make the best decisions for our patients.” Summa Health System is pushing to expand its emergency services operations by overhauling its current emergency room space at its Akron City and Barberton hospitals. Both emergency departments are about 50% overcapacity, hospital officials said. Akron City’s new space, which will cost $49 million, will increase to about 60,000 square feet and 75 beds; the current space sits at about 20,000 square feet with 43 beds. MetroHealth Medical Center, which opened its remodeled emergency department on Cleveland’s West Side in 2004, expected it would take about 10 years to reach 100,000 annual patient visits, but that’s not quite what happened. “In emergency medicine, they always say, ‘If you build it, they will come,’ and they sure did,” said Barb West, MetroHealth’s administrative director of emergency services. She

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Contact: Phone: Fax: E-mail:

Genny Donley (216) 771-5172 (216) 694-4264 gdonley@crain.com

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APRIL 18 - 24, 2011

REAL ESTATE AUCTIONS

REAL ESTATE AUCTION / MAY 18 EXCELLENT VALUE ADDED RETAIL OPPORTUNITY!

ESTATE DIRECTS BANK DIRECTS LAND AUCTION! IMMEDIATE SALE! IMMEDIATE SALE! 4 Commercial & 25,000 SF, 2-STORY 46,310 SF INDUSTRIAL Residential Dvlpmt Sites OFFICE BUILDING w/ WAREHOUSE BLDG ON From 3 Acres to 128 PARKING LOT 9.54 ACRES Acres in NE Ohio ALL LAND PARCELS

OWNERSHIP ORDERS IMMEDIATE SALE!

Painesville Commons Shopping Ctr, 142,000 SF Center on 13.23 Acres THE SHOPPES IN BEREA

OFFERED ABSOLUTE, REGARDLESS OF PRICE! 1441-1535 Mentor Ave., Painesville, OH CURRENT NET OPERATING INCOME AT 75% OCCUPANCY IS $645,000

130-148 Front St., Berea, OH 44017

OFFERED w/ A PUBLISHED RESERVE OF: $395,000 w/ SELLER FINANCING BIDDING TO FOR QUALIFIED COMMENCE AT: BUYERS! $245,000 Located adjacent to Lake OFFERED W/ A PUBLISHED RESERVE OF: $2,495,000

County Fairgrounds on the newly widened, heavily traveled Mentor Ave (Rt. 20) and minutes from I-90, SR-44, & SR 2. Credit tenants include: H&R Block, Sherwin Williams, Best-Cuts, Little Caesar’s, AutoZone, Rent-a-Center, & Save-a-Lot. Very strong location for retail with it’s fantastic demographics and many new developments in the area.

ON-SITE INSPECTIONS: Tuesdays, April 19 & 26, May 3 & May 10 from 1:00 PM to 3:00 PM

8023 Crile Road, Concord EXCELLENT SELLER Township, (just North of FINANCING AVAILABLE!

2940 Noble Road, Cleveland Hts, OH 44121

Retail Stores & Apartments. Entire block bordered by School St. & W. Grand St. (200’Frontage) in the heart of Berea’s Business District. 3 Commercial storefronts & house w/ 4 rental units. Approximately 10,600 SF of Commercial & 2,400 SF of Residential. Excellent Investment Opportunity. Current NOI @ 100% occupancy is $57,547.

ON-SITE INSPECTIONS: Thurs., April 28, May 5 & May 12th from 1:00 PM to 3:00 PM

OFFERED w/ A PUBLISHED RESERVE OF: $250,000 (Only $10.00 per Sq. Ft.!) Currently 75% Occupied with a NOI of $63,682. Projected NOI @ 100% Occupancy $78,461. Originally built in 1974 with an addition in 1988. Many Capital improvements including, new A/C units & updated electrical & plumbing. Excellent opportunity for investor or user/investor to add value and increase income. Located within walking distance of public transportation, major lifestyle centers, retail, restaurants, & entertainment venues in the terrific suburb of Cleveland Heights. ON-SITE INSPECTIONS: Wednesdays, April 27, May 4 & May 11 from 1:00 PM to 3:00 PM

Chardon) OH 44077.

OFFERED w/ A PUBLISHED RESERVE OF: $455,000 (Only $10.00/ Sq. Ft.!)

1.Rt. 611 & Harris, Sheffield Village, OH (Lorain Co.) 18 Acres Zoned Residential. Suggested Opening Bid: $25,000 2. I-90 & SR 45, Saybrook Township, OH (Ashtabula Co.) 36 Acres Zoned Commercial. Suggested Opening Bid: $30,000 3. Lake Breeze Rd. (N of Rt. 611), Sheffield Village, OH (Lorain Co.) 128 Acres Zoned Residential, Opportunity for re-zoning to Industrial. Suggested Opening Bid: $75,000 4. Rt. 18 & Abbeyville Rd., Medina City, OH (Medina Co.) 3 Acre Corner Zoned Comm. Suggested Opening Bid: $7,000

Well located off SR 44 and 1/4 mile South of I-90, this property was built in 1971 with a 12,000 SF addition in 1994.12’- 20’ clear ceilings, 6 docks, 1 drive-in door, overhead gas unit heaters, 277/480V/3P with power and distribution throughout. Seller would consider 10,000 SF leaseback. Terrific opportunity for user, investor, or user/ investor. Property lends itself well for multi-tenant Off-site Due Diligence occupancy. Seminar at Chartwell ON-SITE INSPECTIONS: Group Headquarters: 1301 Thursdays, April 28, May E. 9th St., Cleveland, OH 5 & May 12 from 1:00 PM 44114. Friday, May 6 At to 3:00 PM 1:00 PM

For Brochure & Terms of Sale call: Michael Berland or Mark Abood: 216-360-0009

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4/15/2011

APRIL 18 - 24, 2011

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23

THEINSIDER

THEWEEK APRIL 11 - 17 The big story: First, it was American Greetings Corp. Now, it’s Diebold Inc. that has managed to extract a big package of financial incentives from the state of Ohio to keep its headquarters in Northeast Ohio. The maker of automated teller machines and bank security equipment announced plans to construct a consolidated corporate campus that it said “will form an expanded world headquarters in the Akron/Canton region.” The company, currently based in Green, said the state has committed $56 million in tax credits, loans and other incentives. Pending approval by relevant state and local government boards, the company will receive about $100 million in total incentives from state and local entities. To qualify for the incentives, Diebold will need to retain 1,500 jobs in Ohio. Expanded options:

Business is looking up for Flight Options LLC — so much so that the provider of private jet services based in Richmond Heights is looking to recall more of its pilots and is planning to add planes. Flight Options said it plans to recall up to 24 furloughed pilots in phases, with eight pilots initially re-entering active service this month. They will join a team of 311 pilots, including eight previously furloughed pilots that were recalled in March. CEO Michael J. Silvestro also told Crain’s the company in 2011 plans to add 15 aircraft to its fleet of 102 jets.

Something to build on: The launch of the Cleveland Medical Mart and Convention Center and other projects is pacing a surge in Northeast Ohio contracts for future construction spending. Contracts for nonresidential construction this year through the end of February in the Cleveland Metropolitan Statistical Area climbed almost three-fold, to $638 million from $223 million in the like period of 2010. However, a continued decline in planned residential construction activity somewhat dampened the overall figures from McGraw-Hill Construction. A new vision: The Cleveland-Cuyahoga County Port Authority is planning for wind turbine shipping and assembly in its future, even as it sketches container shipping and cross-lake ferry traffic into its master plan. The plan is expected to be completed in the next 60 days. It focuses on the Port Authority’s cargo-handling business, and its most optimistic growth scenario anticipates total cargo tonnage growing to 2.5 million tons in 2030 from 450,000 tons a year at present. Seeking a spark: Blue Spark Technologies, a Westlake company that makes thin, flexible batteries, has a new CEO. Norbert Dawalibi replaced Gary Johnson as chief executive. Mr. Dawalibi is a former IBM executive who for the past five years has been CEO of Toronto-based Sirit Inc., a radio frequency identification technology company. Blue Spark did not elaborate about why the change was made.

He’ll be missed: High-profile industrial real estate broker Ken Fleming, 67, died April 11 after a protracted illness. A veteran of more than 30 years in the region’s commercial real estate business, Mr. Fleming most recently was a vice president at Mohr Partners. For years, he ran the industrial unit of Grubb & Ellis Co.’s Cleveland office after a similar role at Cragin Lang Free & Smythe. He also chaired the Greater Cleveland Real Estate Organizations, an umbrella group designed to strengthen the industry’s voice on regional economic and real estate issues.

REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS

FDIC’s big case vs. former AmTrust parent wears on

the FDIC declined comment last week. As for the AmFin bankruptcy case, a plan of reorganization has been filed, but not approved. — Michelle Park

■ Jury selection is set to begin today, April 18, in U.S. District Court in Cleveland in the proceedings brought by the Federal Deposit Insurance Corp. against AmFin Financial Corp., the former holding company of failed AmTrust Bank. The selection process begins a year after the FDIC sued AmFin in April 2010 for $518.5 million, alleging AmFin failed to honor a commitment to keep the Cleveland bank capitalized. AmFin counters it never made such a commitment. The FDIC filed its motion after AmFin filed for Chapter 11 bankruptcy protection in late November 2009, only days before the FDIC took over AmTrust Bank. If the FDIC prevails, there would be nothing left to distribute to other AmFin creditors, said Philip Oliss, one of the Squire, Sanders & Dempsey lawyers who’s representing AmFin. Even if the FDIC does not win the case, debtors believe the agency still would end up the largest creditor. An FDIC win could set a precedent and hold bank holding companies to a new standard, Mr. Oliss said. “If they’re successful in this, I think we’re going to see more and more of these cases,” he said. “I think … (the FDIC) see increased bank failures, and they’re trying to come up with a new tool to gain an advantage in bankruptcy proceedings.” A Baker Hostetler attorney representing

■ Concord Hospitality Enterprises Co., a hotelier with Northeast Ohio roots, is venturing into downtown Cleveland’s hotel market after buying a stake in developer John Ferchill’s Hampton Inn, 1460 E. Ninth St. “We believe it’s an opportune time to invest in downtown, with the new medical mart under construction and the planned casino,” Grant Sabroff, a Concord senior vice president, said in an interview. “In our view, the city is in an early stage of revitalization, which will have continued momentum.” An extensive renovation of the 15-year-old hotel will begin mid-year that will position the Hampton to compete as if it were a new hotel, Mr. Sabroff said. He said the upgrade is a seven-figure project, but declined to specify a cost estimate. Concord began operating the inn April 8. Mr. Ferchill said Concord approached him about taking a stake in the nearly 200room hotel. “We refinanced it and reformed the partnership, so now they are in the deal with us,” he said. Neither party disclosed terms of the transaction. However, a deed filed April 8 in Cuyahoga County shows Concord paid $500,000 to buy out a ground lease on the

WHAT’S NEW

BEST OF THE BLOGS

COMPANY: Longshot Camera Systems, Cleveland PRODUCT: The Polester Jim Polster thinks he has the answer for anyone who has ever missed that perfect camera shot. His company’s new product, The Polester, is a telescoping camera mount and triggering system that “positions and operates any compact digital camera at previously unimaginable heights, lengths and depths.” The rig features a retractable string that extends down to the base of the pole. The camera mount portion of the setup attaches to a double-action locking telescoping pole. In turn, the pole has a handle with a release button that enables the user to extend it to the necessary position. In a video on his web site, Mr. Polster says the Polester enables users to shoot pictures without the fears and risks associated with climbing a ladder, entering a confined space or (with the right camera) going under water. “This system will take your camera just about anywhere,” he says. For information, visit www.Longshot CameraSystems.com. Send information about new products to managing editor Scott Suttell at ssuttell@ crain.com.

Downtown Hampton Inn in store for makeover

hotel site held by B&M Realty Co. Downtown is not the only place Concord is expanding in Cleveland. It is a partner in Snavely Development Co.’s planned University Circle hotel, and continues to run hotels in Beachwood, Stow and Willoughby. Concord in 1993 moved its headquarters to Raleigh, N.C., from Mentor. — Stan Bullard

ABA president to speak as part of 2011 Law Day ■ Speaking to a large room of lawyers gathered for an Ohio State Bar Association annual district meeting last Wednesday, Michael N. Ungar revealed he had “big news.” Stephen N. Zack, president of the American Bar Association, will speak at The City Club of Cleveland May 6 as part of the 2011 Law Day program, Mr. Ungar announced. “This is a big deal,” Mr. Ungar, president of the Cleveland Metropolitan Bar Association, said later. “There’s no one who is more influential amongst practicing lawyers on a national basis than the president of the American Bar Association.” Mr. Ungar sent Mr. Zack the invite in March. The last time an ABA president spoke in Cleveland was Bill Neukom in 2008, according to an ABA spokeswoman. Mr. Zack’s remarks will center on why civics education must be a national educational priority, Mr. Ungar said. The Cleveland bar association’s 3Rs Program, through which more than 500 lawyers volunteer to teach civics in 20 area schools once a month, has caught the ABA’s attention, he said, and is one reason why Mr. Zack is coming. — Michelle Park

Excerpts from recent blog entries on CrainsCleveland.com.

The 30-30 club is the place to be, in baseball and business

Eaton Corp.’s Craig Arnold has potential that is red hot

■ John Dorfman, chairman of Thunderstorm Capital in Boston and a columnist for Bloomberg News, sang the praises of Cliffs Natural Resources Inc. in an April 11 piece about the 30-30 club — companies that “achieve a 30% return on stockholders’ equity in its latest fiscal year and show 30% average annual earnings growth over the past five years.” (As opposed to baseball’s elite group of players who hit 30 homers and steal 30 bases.) There were a lot of familiar names on the list — Coca-Cola, Apple and the like — but Mr. Dorfman said Cliffs, the Clevelandbased iron ore producer, was one of the more exciting picks. “In addition to benefiting from an economic recovery in the U.S., I figure Cliffs will continue to export heavily to Asia, especially China,” Mr. Dorfman wrote. “In 2010 it sold $1.3 billion of its commodities to China and $311 million to Japan, which faces extensive rebuilding needs.”

■ It must be a bit of an awkward honor for The Wall Street Journal to tell the world that you’re among “the hottest candidates for plum C-suite positions,” but Craig Arnold of Eaton Corp. was in just that position last week. Mr. Arnold, 50, one of two chief operating officers at Eaton, was one of 12 such executives profiled in The Journal. The newspaper said the lineup was compiled from an informal poll of 21 recruiters at 10 big and small U.S. search firms. Each of the 12 top picks was endorsed by at least three of these firms. Here’s why Mr. Arnold made the cut: “As operating chief of Eaton’s industrial sector, he oversaw 53% of the diversified manufacturer’s total 2010 revenue of $13.7 billion …,” The Journal wrote. “Revenue surged 22% to nearly $7.3 billion in the industrial sector, compared with 16% for all of Eaton. The company has had a streak of double-digit profit and sales gains. He has done much of the heavy lifting as the company expands into new product areas.” Mr. Arnold declined to comment. Only one of the 12 — Eric Wiseman, CEO of apparel company VF Corp. — talked in any fashion, and he did it in a colorful way. “Some of the recruiters said they have tried to interest him in leading a larger business outside of the apparel industry, but Mr. Wiseman likes his current outfit,” The Journal reported. “He reinforced that message recently when he grabbed a Journal reporter’s recording device and declared, ‘To my board of directors, I love all of you and am really happy to be here.’”

In real estate, as in life, Clevelanders hang tough ■ Clevelanders can be pretty stubborn when it comes to a lot of things, including, apparently, real estate. Fortune pulled out some data from Trulia .com, a real estate web site, and reported that Cleveland ranks among the markets where home sellers take the longest amount of time to cut their initial listing price. New Yorkers wait 80 days, the longest in the country, before cutting their prices, but Cleveland is in a group of seven cities whose residents wait 70 to 79 days on average, according to the Trulia data. By contrast, Minneapolis led as the market quickest to slash prices, at an average of 45 days.

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4/15/2011

3:49 PM

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