Crain's Cleveland Business

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INSIDE: BANKRUPT CARDINAL FASTENER SEEKS OUTSIDE INVESTMENT TO AVOID SALE PAGE 3 $2.00/JULY 11 - 17, 2011

VOL. 32, NO. 28

DON’T STICK A FORK IN THE WAREHOUSE DISTRICT JUST YET Its restaurants lie amid $2 billion in development. But will safety issues and competitors derail their place in Cleveland’s culinary landscape?

By KATHY AMES CARR kcarr@crain.com

H

as the Warehouse District restaurant scene lost its mojo?

Some say what was once the sizzling restaurant hub of downtown Cleveland is fizzling. Others reject that view, contending instead that the district’s restaurant mix is undergoing a transition and is poised to gain steam when the city’s $2 billion in development projects materialize.

“The casino, medical mart and convention center and Flats East Bank form a triangle, and the Warehouse District is right in the middle of it,” said Thomas Yablonsky, executive director of the Historic Warehouse

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CRAIN’S CLEVELAND BUSINESS

CORRECTION A Page One, June 27 story misidentified the vice president of marketing and business development for the International Exposition Center. He is Eric German. The story also stated that the city of Cleveland bought the I-X Center from Park Corp. for $30 million. While the city did pay $30 million in cash for the facility, it also gave Park Corp. use of the building rent-free through 2014, which makes the total value of the transaction more than $30 million, according to a Park Corp. representative.

COMING NEXT WEEK In our annual Women of Note section, Crain’s identifies and profiles 15 of Northeast Ohio’s leading businesswomen who are making a difference in their respective communities.

REGULAR FEATURES Classified .....................22 Editorial .......................10 Going Places................13

List: Highest-paid non-CEOs.............19-20 Reporters’ Notebook ....23

WWW.CRAINSCLEVELAND.COM

BEHAVIORAL HEALTH CARE DIVIDE Private insurance is considerably less likely to be tapped to cover behavioral health care than it is to cover other health services, according to Kaiser Foundation data included in a new Center for Health Affairs report, “Behavioral Healthcare Checkup: Are We Where We Need to Be?” (Behavioral health disorders include mental illness and substance abuse disorders.) The Center for Health Affairs report finds that more than 2.8 million Ohioans have a diagnosable mental illness and more than 850,000 have a substance abuse disorder. Here’s how treatment for those problems is paid:

All health services

26%

17%

Private insurance

24

37

Other state and local

21

6

Out of pocket

11

13

Medicare

7

18

Other federal

7

5

Other private

4

4

SOURCE: KAISER COMMISSION ON MEDICAID AND THE UNINSURED, APRIL 2011

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JULY 11 - 17, 2011

700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 Phone: (216) 522-1383 Fax: (216) 694-4264 www.crainscleveland.com Publisher/editorial director: Brian D. Tucker (btucker@crain.com) Editor: Mark Dodosh (mdodosh@crain.com) Managing editor: Scott Suttell (ssuttell@crain.com) Sections editor: Amy Ann Stoessel (astoessel@crain.com) Assistant editors: Joel Hammond (jmhammond@crain.com) Sports Kathy Carr (kcarr@crain.com) Marketing and food Senior reporter: Stan Bullard (sbullard@crain.com) Real estate and construction Reporters: Jay Miller (jmiller@crain.com) Government Chuck Soder (csoder@crain.com) Technology Dan Shingler (dshingler@crain.com) Manufacturing Tim Magaw (tmagaw@crain.com) Health care & education Michelle Park (mpark@crain.com) Finance Research editor: Deborah W. Hillyer (dhillyer@crain.com) Cartoonist/illustrator: Rich Williams Marketing/Events manager: Christian Hendricks (chendricks@crain.com) Marketing/Events Coordinator: Jessica Snyder (jdsnyder@crain.com) Advertising sales director: Mike Malley (mmalley@crain.com) Account executives: Adam Mandell (amandell@crain.com) Dirk Kruger (dkruger@crain.com) Nicole Mastrangelo (nmastrangelo@crain.com) Dawn Donegan (ddonegan@crain.com) Office coordinator: Toni Coleman (tcoleman@crain.com) Web/Print production director: Craig L. Mackey (cmackey@crain.com) Production assistant/video editor: Steven Bennett (sbennett@crain.com) Graphic designer: Lauren M. Rafferty (lrafferty@crain.com) Billing: Susan Jaranowski, 313-446-6024 (sjaranowski@crain.com) Credit: Todd Masura, 313-446-6097 (tmasura@crain.com) Circulation manager: Erin Miller (emiller@crain.com) Customer service manager: Brenda Johnson-Brantley (bjohnson-brantley@ crain.com) 1-877-824-9373

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Cardinal piques the interest of potential buyers

INSIGHT

Bankrupt manufacturer reorients course after financial issues disrupt operations

By DAN SHINGLER dshingler@crain.com

Cardinal Fastener & Specialty Co. plans to emerge from Chapter 11 bankruptcy protection and remain a significant supplier of bolts to the wind energy industry, Grabner its president says. But the company in Bedford Heights likely will have a big new investor — if not a new owner — when the reorganization process is finished.

Cardinal filed for Chapter 11 June 30, and has revealed in court papers that it’s talking to at least four possible buyers that have expressed interest in the company. One is an unidentified German company that visited Cardinal last Thursday, July 7, to conduct due diligence. Cardinal said in the filings that this potential bidder might serve a stalking horse to help set a price for a sale of the company, though the German com-

pany ultimately could buy Cardinal outright.

Cardinal president John Grabner said he hopes and expects to stay on, even if the company is sold, and he believes other employees and company officers will remain as well.

“From everything anyone has told us, they want to buy Cardinal for its people and its culture,” Mr. Grabner said in an interview last week. “It’s not just the equipment.”

Mr. Grabner’s first choice, though, is to recapitalize the company with the help of an outside investor, rather than sell it. Cardinal officials are talking with at least three potential investors as well as buyers, according to Mr. Grabner and court documents.

Cardinal is up and running with about 20 employees now, Mr. Grabner said, though that’s less than half its See CARDINAL Page 21

THE WEEK IN QUOTES JANET CENTURY

Jeff Mowry faces a roster of challenges as Cuyahoga County’s new chief information officer.

CUYAHOGA REBOOTS Jeff Mowry is tasked with streamlining IT functions among web of agencies within a county recuperating from corruption

By CHUCK SODER csoder@crain.com

J

eff Mowry has a lot of work to do.

As Cuyahoga County’s first chief information officer, Mr. Mowry inherited a hodgepodge of IT employees, hardware and software scattered across a dozen county agencies.

Now he’s been tasked with turning that mishmash into a unified IT

department.

The Bellville, Ohio, native — who started his job in April after spending more than two years as CIO of Broward County, Fla., which includes Ft. Lauderdale — says he relishes the chance to come back to Ohio and transform an IT department as big as Cuyahoga County’s. Not that it will be easy.

On his long list of priorities is a plan to combine the 97 IT employees

“(The Warehouse District is) still a viable location for some restaurants, but it’s not a good fit for my concepts.”

“For a building with this kind of vacancy issue, financing is hardly a gimme.”

— Neil Viny, principal, Dalad Group. Page 11

— Chef Zachary Bruell, whose fifth local restaurant, Cowell & Hubbard Co., will be in the PlayhouseSquare theater district. Page One

“If you’re not going to do anything else with social media, at least listen.”

— Rose DiPietro, director of online marketing, Council of Smaller Enterprises. Page 15

See MOWRY Page 20

“Our definition of a sustainable operation is for your business to run on its own. As far as we’re concerned, we have a sustainable operation … in more ways than one.”

— Michele Bishop, co-owner, Urban Organics. Page 15

Court-appointed receiver to take reins of ailing Parmatown Mall

By STAN BULLARD sbullard@crain.com

Prospects for Parmatown Mall and Shopping Center are so challenging that its owners — members of Forest City Enterprises Inc.’s founding families — have agreed to let a court-appointed receiver assume control of the 1 millionsquare-foot landmark that played a big part in Forest City’s early

growth.

U.S. Bank, which serves as trustee for a $60 million securitized loan against Parmatown, received approval last Wednesday, July 6, from Cuyahoga County Common Pleas Judge John O’Donnell to make the Cleveland office of CB Richard Ellis the receiver for the property.

The move puts an outside group in control of the mall and associated

shopping center for the first time since their inception in 1962 and 1960, respectively. Parmatown One LLC, consisting of members and heirs of the Ratner, Miller and Shafran families that founded Forest City, owns the property.

Parmatown is separate from the public company’s multibilliondollar real estate portfolio. RMS Investments — which takes its name from the initials of the

founders — manages it.

Court documents filed by U.S. Bank said Parmatown has lost half its value over the last seven years.

It also indicated that unless the receiver is able to change the property’s course, the lender will be unable to recoup its investment.

Rising vacancy — partly due to the non-highway location and age of Parmatown and partly due to retail hemorrhaging in the last

recession — means its value had plummeted to as little as $25 million in 2008, according to court documents filed by US Bank.

Robert Gephart, RMS executive vice president, said in an interview last Wednesday that the owners knew the June 24 filing by U.S. Bank was coming. They do not plan to contest it, according to Mr. Gephart.

See MALL Page 5

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Ahuja now a player on golf scene Busy philanthropist buys note on Aurora’s Barrington Golf Club

By STAN BULLARD sbullard@crain.com

After 25 years of dedicated and loyal service... THIS WAS THE COMPANY’S

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The Law Firm of David A. Young, LLC represents long-term, highly compensated executives during the termination process.

We represent individuals, not corporations.

Philanthropist and industrialist Monte Ahuja is in position to add “golf course owner� to his name after recently acquiring the $5.7 million note that Youngstown-based Home Savings and Loan Co. held on Barrington Golf Club in Aurora.

Mr. Ahuja told Crain’s that he is reviewing his options for how to convert the debt position to ownership of the club, which is possible because the note is nonperforming.

He said he wants to take the least disruptive course to consolidate his ownership to avoid hassles and to keep the focus of the operation and the club’s members on golf.

An ardent golfer, Mr. Ahuja said it was an easy decision to buy the multimillion-dollar mortgage after he

learned the bank was shopping the note. “I’ve played Barrington a few times. I know the course.

I always enjoyed it,� Mr. Ahuja said. “When I heard the bank was marketing the note, the purchase was made quickly. I wanted to make Ahuja sure the members are supportive — and they are. I’m hoping and counting on keeping the glory of Barrington, a beautiful course and club, and making it grow.�

Banks typically sell troubled mortgages to get them off of their books, typically at a substantial discount. Buying a mortgage provides a back-door way for a new prospective owner to secure the ownership of the property.

Mr. Ahuja declined to disclose how much the family-led BGC LLC paid for the mortgage. Portage County land records show BGC acquired the note June 16, but they do not disclose the price paid for it.

Norman Wells, a past president of the club who ran efforts to cure its financial woes, said the club was

seeking a solution when Mr. Ahuja’s mortgage purchase presented it with one. “It’s not one we courted,�

Mr. Wells said, “but it appears to be a terrific solution.� He said the club was not in foreclosure but had been trying to work with the bank because the club had financial issues. “Typical of a lot of clubs, we were fine until the economy turned down,� Mr. Wells said.

The club’s debt resulted from a 2006 purchase of the property by the nonprofit Barrington Golf Club from the estate of the late Bertram “Bart� Wolstein, who developed the Jack Nicklaus-designed course and the tony residential subdivision surrounding it.

Mr. Ahuja said he plans to keep the Barrington name intact and continue to operate it as a private club. However, he said he is looking at making some improvements to the property because it is approaching 20 years of age. The club opened in 1994. â–

Small law firm mergers Crain’s nabs outpace 2010 activity 3 industry s WWW DAVIDYOUNGLAW COM

With dearth of bigger targets, many with aging leadership see acquisition as succession plan

By SCOTT SUTTELL ssuttell@crain.com

The April purchase of Cleveland law firm Millisor + Nobil by a Georgia firm was part of a significant pickup in small law firm merger activity in the first half of 2011 compared with the like period a year ago, according to data compiled by Altman Weil MergerLine.

Altman Weil, a legal consulting firm headquartered in Newtown Square, Pa., reported last week that there were 12 law firm mergers and acquisitions announced in the United States in the second quarter of 2011 and 28 for the first six months of 2011. The total number of 2011 combinations at the midyear point was up 47% from the first half of 2010.

Ten of the 12 deals reported in April, May and June of this year, including the Millisor + Nobil deal, were acquisitions of law firms with 20 or fewer lawyers. The other two deals were acquisitions of firms with fewer than 50 lawyers.

Fisher & Phillips LLP, a national labor and employment law firm out of Atlanta, absorbed Millisor + Nobil on April 16. Nineteen attorneys from Millisor + Nobil, which also specializes in labor law, joined Fisher & Phillips. Financial terms of the transaction were not disclosed.

Altman Weil said the dominance of small-firm deals continues a

trend that has emerged during the recession. In 2007, before the recession hit, 63% of mergers involved firms of 20 or fewer lawyers, according to Altman Weil data. For the first half of 2011, that number has jumped to 86%. “We see a couple of things driving this shift,� said Altman Weil principal Eric Seeger in a statement. “In the most desirable acquisition markets, there are few prime law firm targets left. Many midsize firms have either already merged, have decided to stay independent, or have spun off from larger firms and don’t want to go back, so demand is outpacing supply in many markets.�

Mr. Seeger said interest among smaller firms in being acquired is “driven largely by demographics.� “A lot of smaller firms are finding themselves with aging leaders and rainmakers who are getting ready to retire,� he said. “Being acquired can be a good succession plan for a firm in that situation.�

The Millisor + Nobil deal is illustrative of this practice.

Steven Nobil and Ken Millisor formed their law firm in 1975. Mr. Nobil continues with the combined firm, but Mr. Millisor is retiring.

The complete list of law firm mergers and acquisitions announced to date in 2011 as well as an archive from prior years and a four-year trend summary are available at www.altmanweil.com/mergerline. â–

Volume 32, Number 28 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of May and fifth week of May, the fourth week of June and first week of July, the third week of December and fourth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright Š 2011 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $2.00.

POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877-824-9373.

REPRINT INFORMATION: 800-290-5460 Ext. 136

group honors

Crain’s Cleveland Business has been honored with three awards in the annual Editorial Excellence Awards competition staged by the Alliance of Area Business Publications, the industry group for regional business publications.

Former Crain’s finance reporter Arielle Kass won a gold, or first place, award in the category of Best Scoop among large tabloids for breaking the story that the Federal Deposit Insurance Corp. had sued AmTrust Financial Corp. (now AmFin Financial) for $518 million because of the company’s alleged failure to serve as a “source of strength� for its former subsidiary, AmTrust Bank, which the FDIC took over in late 2009.

Miller

Carr

Hammond

Government reporter Jay Miller won a bronze, or third place, award in the category of Best Local Coverage of National Business or Economic Story for his look at how public companies in Northeast Ohio that suddenly were flush with cash because of a rebounding economy were hoarding their dollars instead of investing them for fear that the recovery may not be sustained.

And assistant editors Kathy Ames Carr and Joel Hammond won a bronze award in the category of Best Special Section Design for Crain’s 30th Anniversary Issue.

The awards were judged by the University of Missouri’s School of Journalism and were presented last month at the association’s annual summer meeting, which took place this year in Providence, R.I. â–

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KeyBank Center headed for auction Mall: Parma mayor keeps Asking price a mere $3.5M for downtown’s 800 Superior Ave. site

By STAN BULLARD sbullard@crain.com

The lender controlling the 23story office building at 800 Superior Ave. in downtown Cleveland is going the auction route to find a way out of owning KeyBank Center, better known as the former McDonald Investments Center.

LNR Partners, the real estate financing and investment concern based in Miami Beach that took title to the 440,000-square-foot building in February 2010, has listed the property at Real Estate Development Corp.’s website Auction.com for an online auction running from 10 a.m.

July 25 to 10 a.m. July 27.

The property carries an asking price of just $3.5 million, well below the $44 million market value the Cuyahoga County assigns it for property tax purposes.

Alex Jelepis, a Grubb & Ellis Co. senior vice president who is marketing the property with Guggenheim Realtors in Beachwood, said the low starting price is to attract interest in the offering. He said he expects the building to sell for more than the asking price.

Michael Guggenheim, whose Guggenheim Realtors is meeting

with prospective bidders to tour the property, did not return three calls about the sale.

The building, which dates from 1969, will have occupancy of just 37% when the Calfee Halter & Griswold law firm exits for a nearby building next year. Its owner, LNR Partners, handles bank-owned properties and invests in buying defaulted loans or distressed properties from banks.

Dallas-based real estate firm Behringer Harvard handed over the keys to LNR rather than face the daunting task of finding new tenants for the building after Calfee moves.

The red-brick KeyBank Center is a different structure from Key Tower, the tallest building in the state and KeyCorp’s headquarters.

Joseph Marinucci, president of Downtown Cleveland Alliance, which markets downtown as a business and redevelopment location, said the building at 800 Superior stands to play a prominent role in the future of the recently designated NineTwelve District.

The NineTwelve District is a concept the alliance and the city of Cleveland are using to craft a new story for what once was the city’s finance district.

The concept emphasizes pedestrian activity and a future as a mixed-use residential, entertainment and office district.

“We’re cognizant of the challenge and the opportunity,” Mr. Marinucci said of the building.

Hope of an improving market The departures of banks, law firms and corporations from East Ninth leave the corridor that includes East 12th Street (hence the NineTwelve) with significant and growing office vacancies. Longtime Clevelanders will recall the district was formed by urban renewal efforts in the 1960s and 1970s.

Unlike some buildings in the area from East Ninth to East 12th that Downtown Cleveland Alliance sees as candidates for conversion to apartments or hotels, KeyBank Center likely is best used as an office tower, Mr. Marinucci said. Its floors are large and suited to offices, and they would be costly and difficult to carve into residential suites.

Although the last auction of a vacancy-riddled downtown office tower came to naught in April 2010 when the dark, mothballed 1717 East Ninth St. building (formerly the East Ohio Gas Building) drew no takers, experts believe the market is improving.

David Browning, managing director of the Cleveland office of CB Richard Ellis, said private equity groups and real estate investment trusts are able to buy with less reliance on borrowed funds as they adapt to a tight lending environment. Buyers also are starting to look beyond the nation’s coasts for investments, he said.

An LNR spokeswoman declined comment on the planned auction of 800 Superior.

■

fingers crossed on future continued from PAGE 3

Mr. Gephart said paying the mortgage has become “harder and harder” given a 30% vacancy rate at Parmatown. He said the owners do not want to invest more in the retail complex after putting more than $40 million into the property the last several years.

A Walmart was added to Parmatown in 2004 at the site of a former Dillard’s department store, but its presence hasn’t prevented the loss of small-shop national retailers, Mr. Gephart said.

Court records said Parmatown One consented to the receivership after the loss of such tenants as The Gap, the Disney Store, Lane Bryant and even McDonald’s. Parmatown One has been unable to replace those national retailers with comparable tenants, according to U.S. Bank’s suit.

Small-shop tenants are crucial to a shopping mall’s viability, in part because anchor retailers receive sweet terms for operating at a mall.

Parma Mayor Dean DiPiero said he wasn’t surprised by the receivership. He emphasized the potential positives the receivership may produce and the city’s readiness to back the mall.

“I believe this opens the door for someone (else) to invest in the property,” Mayor DiPiero said. “I think the community will support a

property that meets their needs. I think this is an opportunity, and I’m hopeful about the property.”

Solid anchors remain The mayor said the city has met frequently with Parmatown’s managers and the city even leased space there for its recreation and fire departments. He said it’s his understanding from RMS and merchants that foot traffic has increased at the property since Walmart opened.

Mayor DiPiero said Parmatown also has key anchor tenants — retail assets other troubled malls in the region lack. Macy’s, J.C. Penney and Dick’s Sporting Goods occupy space in the complex. All told, there is nearly 1.2 million square feet at the property, including offices at Parmatown Medical Center.

Mr. Gephart acknowledged that the receivership action itself does not spell the end of Parmatown One’s ownership at the property.

Redoing such huge properties not only takes vision but also a huge sum of cash that is likely to prove difficult to obtain these days.

Rich Moore, a Solon-based analyst who follows public realty companies at RBC Capital Markets, views the lender action as making the best of a difficult situation.

“Receivership is a way to dispose of something that no one wants,” Mr. Moore said.

■

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Study: Ohio manufacturing solid, but tax climate lags Ohio gets mixed results in survey by Ball State

By DAN SHINGLER dshingler@crain.com

Ohio leads the class in manufacturing but needs to make good on a promise to bone up on its economic development studies by improving the tax climate for business.

If that sounds like something written on your kid’s report card, it’s not by coincidence. They are the conclusions reached by Mike Hicks, a researcher and director of the Center for Business and Economic Research at Ball State University in Indiana.

And yes, Dr. Hicks is a teacher, a college professor, as well.

Each year Dr. Hicks and the center give states a “manufacturing and logistics” report card, measuring each state’s performance in areas such as the strength of its manufacturing base, logistics, work force and tax climate, plus a few other key indicators.

Ohio isn’t doing that badly — and in manufacturing, it gets a solid A, Dr. Hicks said. The study looks at numerous indicators, including how much value is added to goods by

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manufacturers in the state, as well as their share in overall U.S. industrial production.

The Buckeye State’s manufacturing base is doing well and has the strong companies and facilities needed to compete, he said. On top of that, Dr. Hicks gives the state an A in logistics, for its strong transportation abilities and robust infrastructure.

Dr. Hicks said he believes Ohio is one of a few Rust Belt states that is going to prove the nation’s manufacturing heartland not only has some life left in it, but also will rebound as it becomes more productive and better competes with other nations, where wages now often are rising faster than in the United States.

Asked if the old states with their old plants and factories were at a disadvantage, Dr. Hicks said that no longer seems to be the case.

“I don’t think that’s true anymore, I think we’ve turned the corner,” he said. “I’m fairly optimistic about the Midwest over the next century.”

But that’s not to say there aren’t challenges. Ohio needs to improve its tax climate — an area in which Dr. Hicks’ center gave the state a D-minus.

That puts him in agreement with Gov. John Kasich, who consistently rails against the state’s taxes as being too high and a detriment to attracting and keeping businesses in Ohio.

There are other opinions, of course.

An April study by the accounting firm Ernst & Young, for instance, found Ohio was the third-best state in the nation in terms of having a friendly tax climate for new investments. Other studies, however, are less optimistic.

Sensitive subject As for Dr. Hicks, he applauds Gov. Kasich’s efforts to reduce or eliminate the estate tax and other burdens on businesses and wealthy business owners. The latest of the governor’s initiatives to combat that problem came June 16, when he proposed what amounts to a capital gains tax exemption for investors who invest in an Ohio company and hold that investment for at least two years.

Dr. Hicks said in the current

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THE GRADES ARE IN Ball State University’s Center for Business and Economic Research each year gives states a report card on manufacturing and logistics. Here is how Ohio fared: ■ Manufacturing: A ■ Logistics: A ■ Tax climate: D-minus ■ Work force: C

business environment, companies are more sensitive to tax issues than they are to work force issues. That’s a complete reversal from about five years ago, when workers were tough to find, he said, but in today’s market they are plentiful.

That situation might play into Ohio’s favor, he said, because tax issues can be fixed more quickly than work force issues. Ohio got a C grade in the latter area, which Dr. Hicks terms “human capital.”

“You can change the tax problem quicker — you can go from a C to an A in one (legislative) session,” Dr. Hicks said.

The challenge, he said, will be for Ohio to change its tax climate while still investing enough in training and education to ensure it has a strong future work force.

“If you can pull off lower taxes and still have great human capital at the same time, you’ll be going crazy in manufacturing,” he said.

Balancing act The state needs “a fiscal austerity plan, combined with a real focus on school reform,” Dr. Hicks said.

“It sounds like it’s right out of the Republican play book, but I’m too liberal to be picked up in any Republican primary — even in Massachusetts,” he quipped.

But taxes can’t be viewed in a vacuum, said Ned Hill, dean of the Levin College of Urban Affairs at Cleveland State University.

“Considering tax climate without thinking about services is like talking about the bill you get at a restaurant without considering the food,” Dr. Hill said.

That’s not an alien concept to Dr. Hicks, either, though. He notes that Ohio somehow must balance its needs so that it doesn’t just end up with low taxes, but also continues to support its infrastructure and work force development.

■

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Grocery clinics give providers another revenue avenue In-store offices also help access underserved markets, offer convenient services to patients

By TIMOTHY MAGAW tmagaw@crain.com

Sidestepping the expense of new facilities, Northeast Ohio health systems are setting up shop in supermarkets as a way to bolster access to patients while holding down their costs by heading off unnecessary emergency room visits.

A handful of clinics already offer routine medical services, and others on the way. Some officials at the region’s health care systems say the clinics can help them inexpensively tap into underserved markets and generate more revenue, while others suggest they’re simply a way to offer patients quality care at convenient hours and locations.

The clinics are little more than a primary care doctor’s office in a rented space at a supermarkets.

They’re geared toward treating minor illnesses and injuries, which often clog emergency rooms and inflate the bill for patients and hospitals.

Services.

“UH has a presence in all these areas,” he said. “It’s more about addressing the needs of the public and the needs of employers. Many employers need various screenings done for work-related health care or some on-the-job injury. These can all be done in these settings.”

Tapping new markets Unlike University Hospitals and Summa, Lake Health is using a clinic inside a Walmart Supercenter in Middlefield in Geauga County to

increase its market share by attracting patients who otherwise would fall outside the system’s reach, said Steve Karns, Lake Health’s senior vice president of administrative services. Since the clinic opened last November, the site has treated more than 2,500 patients, most of whom are new to the system.

“It’s a business strategy,” Mr. Karns said. “It was an underserved population in terms of providers.

We thought this was a good idea as it dovetails with Walmart’s philosophy of affordability.”

Lake Health recently opened another Walmart clinic in Madison to replace the urgent care center the system closed to make way for a 10,000-square-foot, freestanding

emergency department that opened last month at its Madison Campus.

The clinics inside these bigger retail venues are patterned after the clinics that have become more common inside drugstores.

With two new locations in Solon and Aurora, MinuteClinic is perhaps the most visible retail clinic available, with 11 sites at CVS stores in Northeast Ohio. Care at the clinics is overseen by medical staff at the Cleveland Clinic, but the clinics are staffed and operated by MinuteClinic, a division of the CVS Caremark Corp.

“Patient expectations have changed. We are a time-pressured society,” said Dr. David Longworth, chairman of the Cleveland Clinic

Medicine Institute. “Customer service is being emphasized in many industries, and health care has finally caught up.”

A clinic in a retail store is a lowcost way to make a statement in a community where a health system wouldn’t necessarily have enough volume to build a new community health center, said Bill Ryan, president and CEO of the Center for Health Affairs, an advocacy group representing area hospitals.

“It’s a way to generate some revenue outside the hospital walls,” he said. “I think it’s a relatively lowcost model, and it’s one way to deliver some primary care in an environment where you can stand to make a little bit of money.”

■

“In many senses, you’re avoiding unnecessary costs.”

– Bryan Fredericks, chief operating officer, Summa Physicians Inc.

We make it our business to know your business.

Summa Health System in Akron operates a clinic inside a Wadsworth Giant Eagle, which will be fully operational by the end of the summer, and is looking to open another one in Stow.

For Summa, the goal of the clinics isn’t “about driving revenue, but rather the element of controlling costs,” said Dr. Bryan Fredericks, chief operating officer for Summa Physicians Inc, the system’s physician network.

“This is a much more cost-effective delivery process,” Dr. Fredericks said. “In many senses, you’re avoiding unnecessary costs.”

Likewise, University Hospitals late last month opened its fourth clinic — known as UH FastCare — in Willoughby inside a Giant Eagle. The health system opened its first site in Legacy Village about a year ago, according to Dr. Michael Nochomovitz, president of University Hospitals Physician

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Parma retailer gives credit to to American-made merchandise Okabashi flip-flops?

“Yep — Hawaii,” not Japan, Ms. Forristell says, knowing the name raises eyebrows in her store. And sure enough, Okabashi’s website touts the company as the only U.S.based maker of flip-flop sandals.

By DAN SHINGLER The average consumer couldn’t dshingler@crain.com do all of his or her necessary shopping at the store, but they could If American manufacturing is fulfill a lot of their needs with Amerdead, that’s going to put a severe ican products — and that’s what U.S. crimp in the business of U.S. Mart — Mart is betting they’ll do. a small retailer in Parma that carries So far, so good, said Ms. Forristell, nothing but U.S.-made merchan- who said initial sales have met her dise. expectations, though the private “It can be tough to find,” admits store does not disclose its sales figstore co-owner Brenda Forristell, ures. During a recent visit by a reporter, who said she and a volunteer at a partner Joe Sessa local church was “Heck, she could have regularly scour the for toys had a ‘made in Northeast looking Internet for Amerito use in a charity can-made goods Ohio store’ if she wanted event and told with mass appeal Ms. Forristell, to.” for their lone retail “We’d like to buy – Greg Krizmnan, spokesman, outlet.

American-made Magnet Some of the besttoys, if we could.” known and biggest And, of course, manufacturers in this country tend they could, because U.S. Mart carries to make things not for consumers, items from Streetsboro-based Step2 but for industry. Think Caterpillar and other toy makers. and its big construction equipment Ms. Forristell, a former programor even companies such as Parker mer at auto insurer Progressive Corp., Hannifin or Eaton locally. They’re said neither she nor Mr. Sessa, who is successful, but you generally won’t her uncle, had any retail experience find their products in Walmart. before they opened the store — just U.S. Mart, though, has found an a hunch local shoppers would supample supply of consumer products port U.S. manufacturers. still made in the United States. The 3,400-square-foot store at 5690 Ridge A heart for Hartz Mountain Road has pet supplies, lawn and Getting customers has not been garden tools, automotive chemicals, as great a challenge as stocking the household cleaning supplies, can- store, according to Ms. Forristell, dles, toys, bakeware, backpacks, who said she wants to find more U.S. cups, glasses and Okabashi flip-flops. goods. Even when she does find a

U.S. Mart’s inventory stocked with a variety of domestic goods

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supplier, it often doesn’t make all their products in the United States, she said. For example, American Greetings makes cards here, but some gift bags and other items are made overseas, so U.S. Mart has the cards, but not the bags.

“We’ve had to send at least one thing back from most orders we’ve received” from all the suppliers U.S. Mart has found so far, Ms. Forristell said.

But she also has found items she didn’t expect, such as a full line of pet products made by New Jerseybased Hartz Mountain Corp.

She also has found a good number of items made by local manufacturers. Besides stocking Step2 and American Greetings products, U.S. Mart carries bakeware made by Cleveland’s G&S Metals, and backpacks and other small luggage items made by Drifter Sport and Travel Bag Inc. in Parma.

Manufacturing advocates here generally applaud efforts to support American-made goods. But they’re

DAN SHINGLER

Brenda Forristell, co-owner of U.S. Mart in Parma, is sold on U.S.-made merchandise. not as surprised as many, or perhaps even Ms. Forristell, at the number of things still made in the United States. After all, they say, America still churns out roughly 25% of the world’s manufacturing output — and some of it is still in the form of consumer products.

“Heck, she could have a ‘made in Northeast Ohio store’ if she wanted to,” said Greg Krizman, spokesman for the manufacturing advocacy and consulting group, Magnet.

“Just around here, there’s Graco making stuff for babies, AlphaMicron makes motorcycle helmets and ski goggles, Wayne-Dalton makes garage doors, Audio-Technica makes headphones, there are several paint-makers, Barbasol makes shaving cream here. And then there’s food, like Nestle’s, Pierre’s Ice Cream and Shearer’s potato chips,” Mr. Krizman said.

Not ready to chow down U.S. Mart is not yet using all its floor space and has room to expand, and Ms. Forristell said it plans to do just that.

“We don’t carry food yet. Eventually, maybe, we’ll get to food — clothing is next,” Ms. Forristell said.

That will be tough, she said, as most clothing is made outside of the United States. But she expects to find enough to provide some selection to her customers.

The store is still young — it only opened at the start of June — so it’s too early to call U.S. Mart a qualified success. But so far, Ms. Forristell said, the store is doing the same thing as its suppliers — making it here.

■

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Warehouse: District backers rebuff security concerns continued from PAGE 1

District Development Corp. “Restaurants are going to benefit from the increased traffic because people are going to be looking for high-quality places to eat when they’re visiting or doing business here.”

Restaurant industry insiders aren’t so sure. They question the Warehouse District’s ability to compete with newer crops of restaurants on East Fourth Street and in the city’s Ohio City and Tremont neighborhoods, and say its eateries don’t provide the same culinary experience as emerging, chef-driven concepts elsewhere.

Other insiders, including former and current Warehouse District restaurant operators, are concerned about the neighborhood’s safety, given the sporadic violence and unrest that have occurred since last summer in and around the district and its West Sixth Street nightclubs.

“I had well-to-do customers spend $400 on dinner, then leave at 11 and walk into an intimidating street scene,” said Steve Schimoler, chef and owner of Crop Bistro & Bar, which opened in 2007 but moved in April from the Warehouse District to Ohio City. “They would tell me, ‘Steve, I’m not coming back.’

“I think the Warehouse District is having an identity crisis,” he said.

However, the discord with the nearby bar crowd wasn’t the main reason Mr. Schimoler moved the bistro from 3,500 square feet on West Sixth to 16,000 square feet in the fledgling Market District in Ohio City. The primary motivator was the need for more space to accommodate his restaurants and retail market, where he sells freshly prepared foods and wine, and his research and development operations.

“If I had been just a restaurant, I probably would’ve stayed,” Mr. Schimoler said. “I’m an eternal optimist.

The Warehouse District has restaurants as solid as a rock. It should be a huge beneficiary of the casino, convention center and medical mart.”

Changing the menu There are comings and goings aplenty these days in the Warehouse District.

About one month after Crop left the district, nearby Metro Bar + Kitchen, which a year earlier had undergone a $500,000 makeover after nine years as the Metropolitan Café, announced it had been bought by restaurant chain Bar Louie.

Waterstreet Grill, which opened 10 years ago on West Ninth Street, in late June was sold to Wiggins Investments Inc., which said it was transforming the eatery into Sixth City Diner with menu prices less than $12.

Joe Saccone, co-principal of the Beachwood-based Hyde Park Group of Restaurants, which owned Metro Bar + Kitchen, said the concept was “not a growth vehicle” for the steakhouse-focused operation that runs 16 restaurants, most of which are under the Hyde Park Prime Steakhouse banner.

“Bar Louie had been waiting in the wings, and again made an offer to buy the space, which Hyde Park couldn’t refuse,” said Mr. Saccone, referencing Bar Louie’s initial interest in the property three years ago.

Meanwhile, Taza, a Lebanese grill that already is in Woodmere, will assume the former Crop space,

THEY SAID IT

FILE PHOTO/JANINE BENTIVEGNA

Ask restaurateurs from the Warehouse DIstrict and elsewhere in the city and other stakeholders to gauge the area’s viability as a restaurant destination, and you’ll get various answers.

Some are sold; others not so much. Here’s a sampling: ■ “The Warehouse District is more viable than ever. I think we’re going to go back to 1994.”

— Rick Cassara (above), owner, John Q’s Steakhouse, which sits on the northwest corner of Public Square

which is owned by Joe Santosuosso of nearby Johnny’s Downtown.

“When Crop left, we could’ve had that space rented in five minutes,” Mr. Santosuosso said. “We had a ton of inquiries about the property, but we wanted to be selective.

“These guys (with Taza) want to be long-term tenants, and it’s a new concept” for the area, he said.

Also slated to open in mid-July is The Prime Rib Steakhouse on Superior Avenue near West Ninth in space formerly occupied by the House of Cues. Chef and owner Attila Salka describes Prime Rib Steakhouse as “affordable fine dining,” with prices ranging from $29 to $45.

“The Warehouse District is the best location for restaurants,” said Mr. Salka, when asked why he selected the site. “It’s in a central location and has beautiful views of the city.”

A taste for other choice Still, the neighborhood hasn’t been able to attract Cleveland’s name chefs, such “Iron Chef” Michael Symon, Jonathon Sawyer of Greenhouse Tavern fame and the prolific Zachary Bruell, even though all three and others steadily have added to their local restaurant portfolios.

Mr. Bruell, who announced July 1 that he would be opening his fifth Cleveland-area restaurant, Cowell

■ “The Warehouse District is greatly positioned to capitalize on the growth we’re seeing downtown. The restaurants are a big part of that.”

— Thomas Yablonsky, executive director, Historic Warehouse District Development Corp.

& Hubbard Co., at Euclid Avenue and East 13th Street in the PlayhouseSquare district, said the last and only time he looked at opening an establishment in the Warehouse District was in 1984. That was in the early years of what would become a successful redevelopment effort to transform abandoned warehouse buildings dating to the 19th century into commercial and residential space.

Mr. Bruell, who since 2004 has opened Parallax in Tremont, L’Albatros Brasserie and Bar in University Circle, Table 45 at the InterContinental Hotel Cleveland, and Chinato on East Fourth Street, characterizes the locations of his current restaurants as growing neighborhoods, and said those areas are what draw new opportunities.

“I look at the Warehouse District as an entertainment district, not necessarily a dining district,” Mr. Bruell said. “It’s still a viable location for some restaurants, but it’s not a good fit for my concepts.”

Joe Gramc, who dines at Cleveland-area restaurants about five to six times each week and shares his experiences on Twitter, said Warehouse District establishments typically are not on his plate of options.

He prefers the bistros, cafés and taverns on East Fourth Street and in Tremont and Ohio City, in part because he finds those neighborhoods more walkable and their mix

■ “I see the Warehouse District as an entertainment district, not necessarily a dining district.

It’s still a viable location for some restaurants, but it’s not a good fit for my concepts.”

— Zack Bruell, owner of Parallax, L’Albatros, Table 45 and Chinato

of establishments more interesting.

“The Warehouse District has bars and nightclubs, but nothing else to keep customers there besides dining,” said Mr. Gramc, vice president of finance at Five Star Trucking Inc. in Willoughby. “It needs more amenities.”

Mr. Gramc said chef-driven, rather than company-driven, restaurant concepts also appeal to him, and he feels the Warehouse District lacks the former. Chef interactivity is a draw, too, he said.

Environmental issues As might be expected, George Schindler and Rick Cassara take some exception to those latter comments.

Mr. Schindler, chief operating officer for Hospitality Restaurants in Rocky River, said chef interaction is part of the customer service approach at his company’s Blue Point Grille at West Sixth and Saint Clair Avenue. And while Blue Point is not chef-driven, its menu of seasonal, fresh seafood continues to draw a loyal following, he said.

Mr. Cassara expressed a similar sentiment.

“Everyone has their own hardworking chefs that produce highquality food,” said the owner of John Q’s Steakhouse, which opened in 1979 on Public Square. “They may not be celebrity chefs, but they do an outstanding job.”

Mr. Schindler also disputed the view of Warehouse District critics that the area’s dining scene has suffered because of racial tensions and the unruly behavior of West Sixth club patrons last summer, along with shootings that occurred just last month around Public Square, near the district.

A bullet from the recent shootings struck a window at John Q’s, but Mr. Cassara dismissed the blemish it created and said his customers do not feel unsafe, noting that violence can strike any area.

“The Warehouse District is more viable than ever. I think we’re going to go back to 1994,” Mr. Cassara said, referencing a downtown Cleveland resurgence that occurred in part after the opening of The Rock and Roll Hall of Fame and Museum, Jacobs (now Progressive) Field and Gund (now Quicken Loans) Arena.

Mr. Cassara and other Warehouse District restaurant stakeholders say the media have sensationalized the unrest. They also scoff when asked whether the Warehouse District eventually could meet the same fate as Cleveland’s Flats, which drew big crowds in its heyday to its bars and restaurants along the Cuyahoga River only to crash and burn last decade after repeated episodes of rowdiness that included the death by drowning of three patrons in 2000.

Public defender Joe Cimperman, a Cleveland city councilman whose Ward 3 includes downtown Cleveland, bristled at the comparison to the Flats.

“The Warehouse District is a mixed-use neighborhood with office, residential and restaurants that continues to thrive,” Mr. Cimperman said. “I think the best days of the Warehouse District are ahead.”

It’s a sentiment on which Jesus DeManuel is banking.

The owner of Mallorca and Brasa, both on West Ninth, said business has been tough during the last couple years, although the recession has hit many restaurant operations hard.

Mr. DeManuel said he’s anticipating traffic from the nearby but stillunfolding Flats East Bank neighborhood, which its developers envision as a combination of residential, office and hotel elements along the Cuyahoga, will be a boon to his ethnic eateries.

The Historic Warehouse District Development Corp.’s Mr. Yablonsky agreed, and cited the group’s Public Realm street improvement project as one example of the continued reinvestment into an area that has garnered more than $500 million in public and private investment since the mid-1980s. Most of that money has been private, with only about $30 million in public investment injected into the district, according to Mr. Yablonsky.

The public part includes streetscape improvements, such as expanded sidewalks and added landscaping, that began in 2009 on West Sixth between Frankfort and Saint Clair avenues. Those improvements will continue in 2013 on West Sixth’s north end, according to Mr. Yablonsky, who maintains that good days are still ahead for the neighborhood and its eateries.

“The Warehouse District is greatly positioned to capitalize on the growth we’re seeing downtown,” he said.

“The restaurants are a big part of that.”

■

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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

At the limit

T

he last six months of activity in the General Assembly only have reinforced in our mind the belief that legislative term limits are doing more harm than good in Ohio.

The churn in the Legislature that term limits force has created a body of lawmakers short on experience who are giving lobbyists, via their legislative minions, far more influence than they should have in crafting bills tailored to their clients’ desires.

We are not naïve. Lobbyists always have played a behind-the-scenes role in the legislative process, and their fingerprints are visible on many of the pages of certain measures.

However, in the current session of the Legislature, the lobbyist tail has wagged the legislative dog so vigorously that the content of various bills has seemed to be hand-written by lobbyists for particular clients.

Consider the changes related to the regulation of charter schools that were included in the Ohio House’s version of the state budget. The changes were sought by White Hat Management, the charter school management company built by Republican campaign supporter David Brennan; among the provisions were amendments that would have allowed for-profit companies such as White Hat to run charter schools without sponsors and would have let operators open an unlimited number of new schools even if they had spotty track records at their current schools.

As The Columbus Dispatch reported last month, Mr. Brennan’s chief lobbyist, Tom Needles, not only had extensive talks with Republican lawmakers about the provisions, but he also sat down with the nonpartisan Legislative Service Commission to draft certain amendments with no lawmaker present.

Now that’s access.

In a similar vein, The Plain Dealer reported last month that Senate Republicans, without any public deliberation, included in their version of the budget bill language that outlined how the Ohio Lottery would be privatized. The PD said the ready-made language was submitted by Mike Dawson, a lobbyist for GTECH, a company that wants to run the lottery.

With each session of the Legislature that goes by, lawmakers seem more willing to make the state budget a dumping ground for measures favored by lobbyists and their clients. Many of these measures should be deliberated on their own merits, but lobbyists and their legislative sidekicks appear inclined to sneak them through the back door to avoid public scrutiny and debate.

Our sense is that lobbyists did not have quite as much run of the legislative asylum in the days before term limits. An abundance of veteran lawmakers could pass their institutional knowledge down to newer legislators, and so keep more control of the legislative process in the hands of those men and women elected by the folks back home to represent their interests in Columbus.

Today, the interests of the chosen few who can hire top lobbyists often come ahead of the public at large. We maintain that ending term limits would help swing that pendulum back to the side of the average citizen. We’d love to see a good government group get behind a measure to repeal them.

FROM THE PUBLISHER

Jackson eschews politics for schools

I

That means that one key element of f anyone needs evidence that Frank the good charter schools, such as the Jackson puts serving his city and its three in the Breakthrough Schools group, residents before personal politics, can be instituted in the newly minted they need to look no further than charters. That means teachers will be last week’s news story about the mayor kept, paid and promoted based on and charter schools. their excellence, not on seniority or by It’s no secret that unions — and espepossessing advanced degrees, two key cially the powerful teachers’ unions — elements of traditional union are the core of the Democratic contracts in public school systems.

Party’s traditional power base. BRIAN This means an opening for So when a big-city mayor, TUCKER the mayor, who is facing the namely Cleveland’s (who also fact that his best-performing, happens to be in charge of the most innovative schools — public schools), threatens that such as the newly renovated relationship with a consideration School of Science and Medicine of more charter schools, that and the district’s two new STEM makes news. (science, technology, engineering Cleveland is Ohio’s only city and mathematics) schools — in which the mayor, by special could lose their best teachers as legislation, also has ultimate financial pressures force district layoffs. authority over the public school system.

While Mayor Jackson has said only Now, by virtue of the recently approved that he’d “consider” such a move, I state budget, any Cleveland school that believe it’s a done deal. Under schools is converted to a charter school would be CEO Barbara Byrd-Bennett, the district exempt from collective bargaining rules poured millions into infrastructure as soon as an existing contract expired.

investments, and some of that went into buildings that could be closed as the city continues to shrink in population. What better way to use them than create well-run charter schools free to deliver exciting educational opportunities for Cleveland’s children?

“Am I willing to do what is necessary to educate children?” the mayor asked rhetorically in a Plain Dealer story. “That I’ll do. If this gets me there, I’ll do it.”

So while the mayor, school board president and schools CEO all say they have no specific new charters in mind, and nothing could be done in time for the coming school year, you can bet that Cleveland will have new charter schools the following school year.

The mayor knows that nothing holds back the revitalization of an urban center than doubts about its schools. If he makes them better, through whatever means possible, he would lay the foundation for young families to return to his city, and thus create a legacy as one of Cleveland’s best chief executives.

■

THE BIG ISSUE Where do you like to dine, and what makes a fine dining district to you?

STEVE BARBER

JOHN GAMBRELL

KATHI VAN HORN

ABRAM SCHWARZ

Cleveland Heights

Cleveland

Seven Hills

Twinsburg

I like the Lee Road-Coventry Road area in Cleveland Heights and Shaker Square. The Colony is a really great place for burgers. There is a range of restaurants in those areas with good service, and generally people are friendly.

I’m a Vietnam vet and meat and potatoes kind of guy, so I like George’s Kitchen on Berea Road and Triskett Avenue. My wife is a big fan of the Food Network and of Michael Symon. So we go to Lola on East Fourth Street.

One of my favorite places is LA Pete’s in Independence. They have the best breakfast in town. In the evenings, I like Versa in Seven Hills. I work downtown, so I like to stay away on the weekends.

There are a lot of restaurants in Hudson that I like. The demographic in Hudson allows some of the nicer restaurants to come in. The Rosewood Tavern is a favorite. It’s in the old Turner’s Mill complex. It’s really neat.

➤➤ Watch more people weigh in by visiting the Multimedia section at www.CrainsCleveland.com.

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Legal Aid relies on vital trust interest ■ Thank you for the June 27, Page 3 story, “A troubling case.” The story increased public awareness about the importance of Interest on Lawyers Trust Accounts. IOLTA — at no cost to lawyers, their clients or taxpayers — allow states to allocate interest derived from lawyer trust accounts to organizations such as the Legal Aid Society of Cleveland that provide legal services to lowincome individuals.

In recent years, the Legal Aid Society has faced severe budget cuts because of the drop in IOLTA rates.

LETTER Yet, under the leadership of an adept board of directors, the Legal Aid Society has increased its services to clients.

In the face of this decrease we have expanded our volunteer base and increased philanthropic funding. In addition, we have a strong and stable reserve fund that has allowed us to weather this storm.

The Legal Aid Society of Cleveland is not worried about the stability of

our organization. Instead, we are realistic about present-day challenges but optimistic about the future.

Because of the IOLTA decrease, we are a smaller organization than we otherwise would be, but we are stronger than ever.

Thank you again for the story. We hope it encourages attorneys to negotiate rates of IOLTA products with banks.

Colleen M. Cotter Executive director Legal Aid Society of Cleveland

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Dalad nabs deal on Rockside-area property Investors bolster exposure with Essex Place purchase

By STAN BULLARD sbullard@crain.com

High vacancy rates dog the Rockside Road office market, but that isn’t stopping Dalad Group from further investing there with the bargainpriced purchase of Essex Place, that area’s newest multitenant office building.

“This is a good building with a leasing problem,” Neil Viny, a Dalad principal, said of the acquisition of the decade-old building from Essex Point Ltd., an investor group led by Donald King of King Group.

ES Investors Ltd., the Dalad-led group, on June 30 paid $2.9 million for the 80,000-square-foot structure, which has an 80% vacancy rate.

Mr. Viny, whose Dalad group manages and owns more than 1 million square feet of office space primarily in or near the southern suburbs, said his group was attracted to the property at 6393 Oak Tree Boulevard because “in a soft market, pricing gets pummeled due to a high vacancy rate.”

Pummeled, indeed. The building carries a market value of nearly $8 million for property tax purposes, according to the Cuyahoga County auditor’s office. Moreover, the original developer had obtained a mortgage on the structure for $7.9 million in 2006 from Prudential Mortgage Capital LLC of Newark, N.J. Mr. King, president of King Group, said in an interview that there was “some (mortgage) restructuring that allowed us to sell it at a reasonable price.”

“It worked out well for everyone,” he said.

However, Mr. King would not discuss the way the mortgages from Prudential were restructured, and Cuyahoga mortgage records do not show what transpired. Mr. Viny said his group bought the building from

Mr. King’s group free of any prior mortgage.

Bad leasing breaks Mr. King said Essex Place had been fully leased for years and the developers profited on the property at the outset. He said he felt it was better to sell the property now to reduce his group’s exposure to the Rockside market, where it owns five other office properties.

The original partners in Essex Place were developers and contractors Greg and Fred Geis, owners of Geis Cos., whose construction firm built the structure. Greg Geis said recently that the two brothers had sold their interest to Mr. King three years ago and held a note on the property that was satisfied by its recent sale.

Mr. King declined to discuss his dealings with his fellow investors.

Bad breaks with tenants accounted for leasing woes at Essex Place rather than the sour market in the southern suburbs, Messrs King, Viny and others say. Grubb & Ellis Co. puts vacancy in that market at 23%.

The structure lost its two major tenants due to corporate consolidations in larger offices: Medical Mutual consolidated a unit from Essex Place to its Strongsville campus last year, and Sprint Corp. exited as it consolidated its local operations with those of Nextel after their 2004 merger.

Mr. Viny said he and a group of silent investors see opportunity in the purchase. He said the biggest challenge is how long it will take to woo tenants back to the building.

Bank financing plays a role Dalad is ready to shoulder the risk of the purchase because its portfolio has little vacancy, which Mr. Viny put at 8%. He said Dalad’s leasing team can use the empty space to pursue large prospective tenants in the 15,000-square-foot range it could not accommodate easily in its existing portfolio.

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of what it would cost to build Essex Place today — should allow Dalad to offer low, competitive rents to prospective tenants and make things rough for competing building owners, said Tom West, director of office services at the Cresco real estate brokerage.

Moreover, with a large portfolio of buildings in that area, Mr. West said, Dalad also may be taking steps to retain tenants desiring to expand who currently are in its properties.

“It may be a good defensive as well as a good offensive move,” Mr. West said.

Mr. Viny said the purchase may portend something positive for the real estate market as a whole.

To buy the building, Mr. Viny said the group has obtained a loan from U.S. Bank for the acquisition, though he was precluded by a confidentiality provision from discussing its terms.

“For a building with this kind of vacancy issue, financing is hardly a gimme,” Mr. Viny said.

■

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Server maintenance expert boosts staff level Park Place adds to sales, biz development teams

By CHUCK SODER csoder@crain.com

Ed Kenty hopes a steady effort to beef up the sales staff at Park Place Technologies LLC will lead to more of the sales increases the company already is starting to see.

Park Place, which helps companies install and maintain computer servers and other hardware, is in the process of hiring the first members of its new business development division, which will start off with six to eight employees, said Mr. Kenty, who is CEO. The team likely will be housed in 3,000 square feet of office space on Chagrin Road, next to the building that houses the company’s Park Place International subsidiary.

Mr. Kenty said he expects the divi-

sion to begin prospecting for sales leads this month.

Those leads will serve as fuel for Park Place’s sales team, which also is largely new: Today the team has 32 employees, up from six at the start of 2009.

That added sales capacity helped Park Place recover quickly from the recession, and it already is helping boost 2011 sales to record levels, Mr. Kenty said.

“It’s really all about sales capacity,” he said.

Park Place saw its revenue drop from $39 million in 2008 to $29 million in 2009. That’s mainly because the recession decimated revenue from the Park Place International subsidiary, which helps companies install and manage their computer

systems. Revenue from Park Place’s core business — maintaining computer servers after their warranties expire — held steady in 2009.

Sales picked up toward the end of the year, however, and by the end of 2010 the company’s annual revenue was back up to $39 million.

All the while, Park Place kept hiring, adding employees to its sales staff and throughout the company. Today it employs more than 200, including about 100 at its three facilities in the Chagrin Falls area. By comparison, the company employed about 130 in October 2008, including about 50 in Northeast Ohio.

“It’s been pretty staggering,” Mr. Kenty said.

Now that the company’s sales team no longer is brand new, it’s starting to produce more impressive results, Mr. Kenty said. So far this year, sales are off to “an incredible start,” he

Five NE Ohio anchors give to orchestra

By SCOTT SUTTELL ssuttell@crain.com

The Cleveland Orchestra’s Center for Future Audiences, an initiative aimed at drawing a new generation of patrons to one of the region’s signature arts institutions, is receiving a big financial boost from five companies.

Baker Hostetler, Eaton Corp.,

Forest City Enterprises Inc., KeyBank and Nacco Industries Inc. have pledged a total of $6 million to fund the launch of audience development programs that are part of the Center for Future Audiences. Each pledged gifts of $1 million or more, though the orchestra did not disclose the specific dollar amount of each company’s contribution.

The orchestra publicly recognized

the contributions last weekend at the opening night of the 2011 Blossom Festival. The benefit concert featuring the Cleveland Orchestra with guest artist Idina Menzel, under the direction of conductor Steven Reinek. The Center for Future Audiences anticipated the benefit event, sponsored by Goodyear Tire & Rubber Co., would raise an additional $500,000. The Center for

said. The company is aiming to hit $48 million in revenue this year, which Mr. Kenty described as “a realistic number.”

“We’ve never had a year like this since I’ve been here,” said Mr. Kenty, who joined the company in 2004, when Park Place bought his previous employer, Technical and Logistical Consultants Inc. of Uxbridge, Mass.

Most of the growth comes from Park Place’s post-warranty server maintenance business, which benefits from contracts with customers who come back, as long as they have older computers to maintain.

The market for hardware maintenance services isn’t expected to grow much over the next few years, but some service providers are growing through acquisition or by stealing market share from competitors, many of whom are small, said Ron Silliman, principal research analyst

Future Audiences is endowed by the Maltz Family Foundation, which last year made a lead gift of $20 million to kick off the audience development initiative.

“We are profoundly grateful for the philanthropic leadership demonstrated by these new sponsorship commitments,” said Gary Hanson, the orchestra’s executive director, in a statement. “We thank these five generous companies for embracing the vision of the Maltz Family Foundation. Together they will help transform the orchestra’s audiences.”

for business research firm Gartner Inc. The recession has driven many companies to re-evaluate their vendors, which opens opportunities for better companies to win business, said Mr. Silliman. Park Place, he noted, is well known for its expertise related to servers made by EMC Corp. of Hopkinton, Mass. “There certainly are opportunities,” he said.

Park Place might face problems down the road if “cloud computing” service providers such as Amazon — which lets businesses tap into its servers via the Internet instead of buying their own hardware — decide to maintain their own servers, Mr. Silliman said. However, many of those companies might decide to outsource the maintenance to the Park Places of the world.

Mr. Kenty noted that the trend toward cloud computing might have “some impact” on Park Place’s revenue years from now. For now, however, there are still lots of servers to serve.

“It’s so vast. It’s not going to go away any time soon,” he said.

■

One of the orchestra’s major goals is to develop the youngest audience worldwide for a symphony orchestra by the time of the orchestra’s centennial in 2018.

To that end, with its performance on July 3, the orchestra kicked off its “Under 18 Free” program to make Blossom Festival concerts more affordable for families to attend.

Patrons will be eligible for two “Under 18 Free” lawn tickets with every paid lawn adult admission.

Tickets can be ordered on the orchestra’s website.

■

The largest pediatric health care provider in NE Ohio.

AKRONCHILDRENS.ORG

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director of research.

GOING PLACES JOB CHANGES

FINANCIAL SERVICE

ARCHITECTURE

FIRSTCREDIT INC.: Robert Walker to manager, IT services; Stacy Boddie, Rachael Hardbarger and Mindy Weaver to patient account representatives; Alexa SimmsWackerly to human resources coordinator.

EDUCATION CASE WESTERN RESERVE UNIVERSITY: Julie M. Rehm to associate vice president, foundation relations and strategic initiatives.

CLEVELAND STATE UNIVERSITY: Carmen A. Brown to vice president, enrollment services.

KENT STATE UNIVERSITY: Sonia Alemagno to dean, College of Public Health.

MIAMI UNIVERSITY: Amy A. Bartter to director of regional development, Northeast Ohio.

NORTHEAST OHIO MEDICAL UNIVERSITY: Dr. Marc Steven Penn to professor of medicine and integrative medical sciences.

NOTRE DAME COLLEGE: Beth L. Kaskel to chair, nursing division.

SAINT JOSEPH ACADEMY: Blake J. Prewitt to principal.

UNIVERSITY OF AKRON: Elizabeth A. Reilly to vice provost, academic planning, Office of Academic Affairs.

FAIRWAY WEALTH MANAGEMENT LLC: Charles Avarello to senior manager; Brad Vitou to associate.

HEALTH CARE CAMBRIDGE HOME HEALTH CARE: Paula Sparkman to regional director, operations and quality improvement, Medicare Division; Cindy Daniels and Bobbi Jo Kumpfmiller to district managers, Private Division.

LAKE HEALTH: Dr. David Sugerman to medical director, Lake Health Emergency departments; Dr. Howard K. Mell to medical director, EMS Lake Health and associate medical director, TriPoint Medical Center Emergency department.

WICHERT INSURANCE: Al Korn to principal, senior account executive, commercial lines insurance.

FIRSTENERGY NUCLEAR OPERATING CO.: Eric A. Larson to vice president, nuclear support.

BOARDS

MARKETING ADCOM COMMUNICATIONS INC.: Jessica Romano and Brian Kozel to account executives; Erin Connor to assistant account executive.

INSIVIA: Alexis Hazboun and Kyle Petersen to account managers.

PR 20/20: Dia Dalsky to consultant.

NORTHEAST OHIO MEDICAL UNIVERSITY FOUNDATION: Derek R. Misquitta (Morgan Stanley Smith Barney) to president; James E. Merklin to president-elect; Douglas J. Thorpe to treasurer; Albert J. Cook II, M.D. to secretary.

ROSENBERG ADVERTISING: Jenna Tucci to senior account executive; Austin Rosenberg to account executive.

PATHWAYS INC.: Steve Ciuni (Drake Construction Co.) to chair; Hector Martinez Jr. to vice chair; Keith Young to secretary; William Pattie to treasurer.

NONPROFIT

AWARDS

AKRON GENERAL DEVELOPMENT FOUNDATION: Steve Bossart to director of development.

GREAT LAKES THEATER FESTIVAL: Holly Tomasch to development director.

REAL ESTATE

ORTHOPAEDICS & SPORTS MEDICINE OF OHIO: Dr. James O’Reilly to president; Dr. Lisa Isphording and Dr. Katie Eslich to managing physicians; Dave O’Reilly to CFO.

PRECISION TITLE AGENCY INC.: Christopher Stafford to director of business development.

SUMMA CARDIOVASCULAR INSTITUTE: Dr. Marc Steven Penn to

ROGERS CO.: Jeremy Goodman to operations manager.

Sherwin-Williams acquires U.K. firm that specializes in protection coatings

13

UTILITY

INSURANCE

MBI | K2M ARCHITECTURE INC.: Stephanie Cieszkowski to marketing coordinator.

CRAIN’S CLEVELAND BUSINESS

WWW.CRAINSCLEVELAND.COM

SERVICE

CONSORTIUM AGAINST ADULT ABUSE: Linda Dooley Johanek (Domestic Violence & Child Advocacy Center) received the 2011 Recognition Award.

Rehm

Alemagno

Reilly

Avarello

Vitou

Korn

Tucci

Rosenberg Tomasch

Stafford

Larson

INTERNATIONAL ASSOCIATION OF BUSINESS COMMUNICATIONS, CLEVELAND CHAPTER: Bruce M. Hennes (Hennes Paynter Communications) received the Communicator of the Year Award.

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

Hennes

In Memoriam

Sherwin-Williams are in the U.K., ON THE WEB Story from Co. said it bought an www.CrainsCleveland.com. Germany, industrial paint manuCanada, India facturer in the United Kingand the United dom that has been owned by the Arab Emirates. Leighs’ products are same family for 151 years. distributed in 47 countries.

The Cleveland-based paintmaker Chris Connor, chairman and CEO did not disclose the purchase price of Sherwin-Williams, noted in a for Leighs Paints of Bolton, U.K., statement that the two companies which makes marine and industrial combined “have nearly three fire protection coatings. Sherwincenturies of experience in coatings Williams said Leighs’ Firetex brand innovation.” He added that the has been used on more than 400 acquisition “reaffirms our strategic projects around the world protecting commitment to growing globally.” offshore platforms, refineries, chemBrian Leigh-Bramwell, chairman ical plants, airports and hospitals. of Leighs, said in a statement that Leighs, founded in 1860, has Sherwin-Williams “shares many 260 employees and operates one similarities with Leighs Paints both manufacturing plant in the U.K. in terms of history, culture and Sales and technical support centers customer focus.”

Scott R. Antill CFA, CFP® Chief Investment Strategist 1975 - 2011

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T-Mobile adding to regional presence

By CHUCK SODER csoder@crain.com

T-Mobile USA is in the process of expanding its office in Independence and ramping up the amount it spends on outdoor and sponsorship advertising in most of Ohio, Kentucky and western Pennsylvania.

The company, the fourth-largest wireless carrier in the United States, has hired people to fill seven new positions at its Independence office since April and still has a few more positions to fill, said Larry Dolot, vice president and general manager for the three-state region, which he runs from Independence.

Four of the new hires are focused on marketing T-Mobile’s wireless communications services to small

businesses in the three-state region, said Mr. Dolot, who was one of the new hires.

T-Mobile also has provided new advertising dollars to the Independence office, which oversees operations in all three states. The money mainly will be used to pay for outdoor advertising, ads related to events and sponsorships, but it could be used for other types of locally focused advertising in the future, he said.

T-Mobile already has agreed to sponsor the Cyber CafÊ at the Council of Smaller Enterprises’ 2011 Small Business Conference in October. As another example of the type of marketing the company is looking to do, Mr. Dolot noted that T-Mobile has struck a deal to adver-

tise with the Florence Freedom, a minor league baseball team in Florence, Ky. “It’s really about getting closer to customers,� he said.

T-Mobile, which also is increasing local advertising in other regions, started pursuing the new strategy long before the March announcement that AT&T Inc. had struck a deal to buy T-Mobile from its German parent company, Deutsche Telekom, for $39 billion.

Mr. Dolot said he did not have information on how T-Mobile’s local operations might be affected by the acquisition, which has yet to be approved by federal regulators. “Up until that point we’ll continue to operate independently,â€? he said. â–

Steris ex-exec gives UH $2M for cancer genetics

By SCOTT SUTTELL ssuttell@crain.com

University Hospitals Case Medical Center will use a $2 million gift from former Steris Corp. CEO Les Vinney and his wife, Linda, to bolster its

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work in cancer genetics.

The Linda and Les Vinney Biorepository and Genomics Facility “will play a key role in advancing genomic knowledge and hastening important discoveries and new cancer therapies,� UH said in a news release Vinney announcing the gift. “This newly established, stateof-the-art biorepository will fuel the development of novel genetic screening tests, critical in the identification of cancer-causing genetic changes and help us devise precise and effective treatments,� said Dr. Stan Gerson, director of the UH Seidman Cancer Center and the Case Comprehensive Cancer Center, as well as a professor of medicine at Case Western Reserve University School of Medicine, in a statement.

Dr. Gerson said the gift also will support “program activities in informatics, biostatistics and cancer genetic counseling, which is critical for families with multiple cancers, giving hope to patients diagnosed with cancer now, and for generations to come.�

UH said by enhancing the ability to code, store and analyze biological specimens, the new Vinney Biorepository “will increase the capa-

bility of UH Case Medical Center physician-scientists to collect and study tissue samples, critical steps in cancer research.� Thousands of samples will be stored and coded in the Vinney Bio-repository each year, which will lead to an acceleration of genetic research in four specific cancer areas for which UH is an international leader: colorectal, brain, breast and esophageal, UH said.

Mrs. Vinney, a retired genetic counselor, and Mr. Vinney have been longtime advocates for the importance of medical innovation and compassionate genetic counseling, UH said. Mrs. Vinney held positions at Akron Children’s Hospital and Morristown Memorial Hospital in New Jersey. “We believe strongly in the Seidman Cancer Center’s commitment to finding a cure for cancer,â€? Mr. Vinney said in a statement. “Advances in cancer genetics will lead to better understanding of risk factors, early diagnosis through genetic testing, and powerful and personalized cures. We are honored to support University Hospitals’ physicianscientists and their tireless efforts to make the next major discovery in cancer genetics.â€? â–

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INSIDE

18 ADVISER: TAKE STEPS TO PREVENT WEB MISUSE.

15

SMALL BUSINESS

THE WILD WORLD OF SOCIAL MEDIA Even with limited resources, business owners can rein in opportunities online

By CHUCK SODER csoder@crain.com

T

he Rutledge Group has six employees.

Three of them help manage the company’s Facebook page.

Even though the insurance brokerage can’t spend much time on Facebook — which is why the company hasn’t started a Twitter account — the effort is worthwhile, said Deborah Rutledge, chief operating officer for the Cleveland company. Posting tips about insurance as well as photos and tidbits about employees has helped the Rutledge Group build name recognition and credibility among people employees know personally or professionally.

“That at some point will pay dividends,” she said, adding that the page already has helped the company land a few new customers, she added.

Even the smallest companies should consider using social media websites and other online tools that can help them protect and promote their brands, according to several marketing experts in Northeast Ohio.

See SOCIAL Page 16

JANET CENTURY

Michele Bishop is co-owner of Urban Organics, which converts horse manure into SweetPeet organic mulch.

Organic mulch producer lays ground for more growth SweetPeet a boon for Brunswick Hills venture

By AMY ANN STOESSEL astoessel@crain.com

T

he location for Urban Organics is marked by nothing more than a large boulder at the end of a gravel driveway in Brunswick Hills.

Down that nondescript path, though, is a compelling story — in terms of both the business that’s planted there and the couple cultivating its growth.

Owned by Mark and Michele Bishop, Urban Organics is the licensed Ohio producer of the organic mulch known as SweetPeet.

The pair also is behind two other, newer ventures, FreeBirdFarms and FreeLandSoils.

The Bishops are an unlikely duo to have started a business that involves hauling horse manure and turning it into growing material.

Mrs. Bishop is a hair stylist by trade. Mr. Bishop, meanwhile, studied restaurant and hotel management at Cornell University, and has run resorts and hotels, worked as an investment broker for Grubb & Ellis and helped take Boykin Lodging public as its senior vice president of acquisition and development.

Twelve years ago, however, Mr. Bishop was diagnosed with a slow progressing form of Lou Gehrig’s Disease, or ALS, which eventually led him to resign his position in the corporate world.

See MULCH Page 17

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SMALL BUSINESS

Tax credit may fuel vehicle switch Social: Online presence Economic incentives could drive proprietors to convert to electric

T

ough economic times and high gasoline prices are inspiring business owners to take a closer look at electric vehicles.

If the fuel savings alone aren’t enough to get a business owner’s attention, the income tax credit might make a switch to an electric vehicle all the more appealing.

The car manufacturers finally are catching up in producing electric vehicles that can qualify for tax incentives meant to spark some growth in alternative ways to power vehicles.

As part of the Emergency Economic Stabilization Act of 2008, Congress established an income tax credit for new qualified plug-in electric drive motor vehicles, including passenger vehicles and light trucks.

Each qualified vehicle is allowed a credit of $2,500, with additional credits added up to $5,000 based on the number of kilowatt hours of rechargeable battery power that the vehicle offers.

That means business owners could earn a potential tax credit of $7,500 for purchasing an electric vehicle that will reduce exposure to volatile gasoline prices.

Each qualifying vehicle put into

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TAX TIPS service by a given taxpayer — whether that’s an individual or business — is eligible for the credit, so long as the vehicle is used by the taxpayer.

The credit is available for vehicles that have been purchased by the taxpayer, but not those leased by the taxpayer. For dealers, the credit can apply to vehicles that have been acquired to lease to others, but not vehicles acquired to be resold.

There are other limits based on whether the vehicle is for business or personal use. For business-use vehicles, the credit is treated as part of the general business credit and therefore is subject to certain liability limitations.

For personal vehicles, the credit is treated as a nonrefundable personal credit and therefore is limited by the total amount of tax liability for the year the vehicle is put into service.

Vehicles such as the Nissan Leaf, the Ford Focus Electric, the Chevrolet Volt and certain versions

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of the Ford Escape are eligible for the credit. The rated battery capacity is a key criterium for eligibility for the credit, and the IRS has established detailed guidance for how it applies.

The Internal Revenue Service has established a special form for claiming the credit, and not surprisingly it has found a high rate of errors among taxpayers trying to claim the credit. That means the IRS is likely to develop some additional measures that taxpayers will have to navigate to substantiate their claims.

It’s not clear exactly how long the credit will remain in place because it gradually phases out as manufacturers sell more qualifying vehicles.

The credit for plug-in electric vehicles is more generous than the credit for hybrid vehicles that went into effect in 2005, but it’s still conceivable that taxpayers could find their credits reduced by 25% or more if they purchase their qualifying vehicles later rather than sooner.

The credits could increase if Congress decides to expand them.

There are members of Congress who are pushing proposals to raise the number of vehicles that would qualify for the full credit, and President Barack Obama has said he would like to see 1 million plug-in electric vehicles on America’s highways by 2015.

There are other tax incentives for taxpayers to consider as well. There are a variety of state and local credits that might apply, and recharging equipment may be eligible for credits.

More innovative car owners who decide to convert their existing vehicles to plug-in electric vehicles also can be rewarded with certain credits.

As with so many tax issues these days, the criteria for qualifying for the credit can be complicated and can create some hurdles that are difficult to clear. For business owners who are fed up with the high cost of gasoline, however, they are credits worth exploring.

■ Mr. DeMarco is vice president and director of tax services for the regional accounting and business consulting firm Meaden & Moore, headquartered in Cleveland.

key part of outreach, but allocate efforts wisely continued from PAGE 15

With the right tools and a clear set of priorities, companies with only a handful of employees can keep tabs on what people are saying about them online, find new customers and serve existing clients better, said Rose DiPietro, director of online marketing for the Council of Smaller Enterprises.

Ms. DiPietro was one of a few local marketing experts who said that small businesses, in particular, need to focus on their biggest priorities when using social media tools.

The Rutledge Group’s main goal, for instance, was to make more potential customers familiar with the company’s brand. Other companies use social media tools to communicate with customers they already have, and some just want to know what people already are saying about them online.

Companies that have established their goals then need to figure out which online tools will help them best achieve them. Companies that sell to other businesses, for example, might want to spend more time on LinkedIn, while a restaurant owner might want to join Foursquare, which a lot of eateries use to offer deals to patrons. Small companies, in particular, may just want to use only one social media tool, at least at first, said Ms. DiPietro, who has provided advice to the Rutledge Group.

Companies that create accounts on a bunch of social media sites sometimes end up abandoning all of them, she said.

‘At least listen’ Though different companies have different goals, Ms. DiPietro said many businesses can benefit by signing up for Google Alerts, a sentiment that other experts echoed. The free service, which sends the user an email whenever a given word or phrase is mentioned online, gives companies an easy way to “listen” to conversations

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that mention their names, their competitors or their industry.

Then a company has the option to thank customers who post glowing reviews, respond to complaints and answer questions, Ms. DiPietro said.

“If you’re not going to do anything else with social media, at least listen,” she said.

Even small companies, though, should go a step further and use Facebook, Twitter, LinkedIn or some other social media tool, the experts said.

Writing a weekly blog is a particularly effective way for a small company to get its name to show up higher in the rankings when people search for the company’s name or related terms on Google, said Joel Goldstein, president of Goldstein Communications Group Inc. of Solon.

“It used to be real estate in the mall. Now it’s real estate on the front page of Google,” he said.

However, starting a blog can be a significant time commitment, said Christina Klenotic, a vice president at communications firm Dix & Eaton Inc. of Cleveland.

“You have to make the case that it can really help with your Google rankings,” she said.

Small companies who want to spread the word about their businesses can do so by catering to bloggers and people who use social media heavily, Ms. Klenotic said.

She noted the Cleveland restaurant AMP 150 drummed up interest online by holding a “Twestival” for heavy Twitter users in March.

“The ripple effect can spread quite dramatically,” she said.

Don’t ignore it Small companies using social media to answer customer questions need to let customers know that they may not always be able to respond immediately, Ms. Klenotic said.

Those using social media for marketing also have to set aside time both to post new content and to engage with customers. “Engaging” might mean writing a traditional response, “liking” a customer’s post on Facebook or “re-tweeting” a message posted on Twitter.

Though it may take time, even small companies should respond to customer comments online, said Dominic Litten, who is president of the Cleveland chapter of the Social Media Club and is head of interactive marketing at marketing firm Point to Point in Beachwood. Compliments deserve “thank yous” and complaints should be addressed, even if it means giving the customer a way to reach you by phone or email, Mr. Litten said.

“Always respond directly,” he said.

Just make sure you have something of value to add before injecting your company’s name into a conversation, especially if no one is asking for input, said Ms. Klenotic, of Dix & Eaton.

She described how she and two of her friends were sending Twitter messages back and forth trying to figure out where they might go for a massage on Cleveland’s East Side.

Then a chiropractor nowhere near the East Side jumped in.

“It just felt so creepy,” she said. ■

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SMALL BUSINESS

Mulch: Inventory may increase with race track contract continued from PAGE 15

Mr. Bishop then learned of SweetPeet and the chance to license its production through a “Martha Stewart Living” segment.

Soon after, the Bay Village couple purchased 27 acres in Brunswick Hills, and Urban Organics became a licensed SweetPeet producer. The company has been making the mulch since 2002, and today it employs 10 full-time workers year-round.

“We went all in,” Mr. Bishop said.

“It had to work.”

Not horsing around More than 50 farms from within a 50-mile radius pay Urban Organics to haul away horse manure, and the business recently signed a longterm agreement with Caesars Entertainment to manage the manure removal at Thistledown race track in North Randall.

The hauling itself is generally a break-even operation for Urban Organics, according to the couple, but it supplies the Bishops with the material needed to create the SweetPeet in a patented composting process.

The material is transported to the Bishops’ Brunswick Hills property, where it becomes part of three enormous piles — each standing about 45 feet tall — that are arranged in a horseshoe formation, all at various stages of SweetPeet generation.

To make SweetPeet, the mixture of manure and bedding is turned over and watered in a process that naturally generates heat; the elevated temperatures, which range from 160 to 180 degrees, kill any harmful bacteria, the Bishops said. It can take up to 10 months for the finished product to be ready for consumer use.

SweetPeet is then sold by Urban Organics to about 100 wholesale customers; for the past two years, the product has sold out by June, with demand far outpacing available supply, according to the Bishops.

“We have nothing but good feedback,” said Todd Kruse, general manager for Chagrin Pet, Garden & Power Equipment Supply Inc., which has sold SweetPeet for the past 10 years.

With an average of 1,100 horses stabled at Thistledown from midApril to the beginning of November, the Bishops anticipate that the partnership with the track eventually will result in about a 40% increase in SweetPeet inventory.

David Ellsworth, the track’s director of operations, said he first was approached several years ago by the Bishops to haul away manure, but at the time Thistledown was bound by another contract.

Even so, Mr. Ellsworth said he was intrigued by the operation and impressed at how it helped “close the loop” on the green process. So when the opportunity opened this year to work with the Bishops, he took it.

“I’m just really glad to be a partner with them,” Mr. Ellsworth said.

“It’s everything that we like.”

On the grow After finding a fertile ground for SweetPeet, the Bishops opted in 2010 to reinvest in the business and expand their operations, adding the brands FreeBirdFarms and Free-

LandSoils to the mix.

As part of FreeBirdFarms, this will be the first season during which the business is growing plants for sale in a new 11,000square-foot organic hydroponic greenhouse. The heat generated from the process of creating SweetPeet is even applied to warming the water used in the greenhouse.

The goal is to harvest 3,000 heads a week from April to late November, and eventually, the Bishops will have the capacity to grow 18,000 heads at a time,

“I’m just really glad to be a partner with (Urban Organics).”

– David Ellsworth director of operations, Thistledown producing a variety unusual red and green leaf lettuce and a variety of Asian greens. The Bishops have plans to work with wholesalers, specialty stores and community supported agriculture programs to sell the greens.

The main focus, however, still is on SweetPeet and the soil operation, FreeLandSoils.

As part of FreeLandSoils, the Bishops now are producing their own brand of potting soil, offering custom soil blending services and taking to market a plant food called RootBooster, which is made with organic composted worm castings.

(The Bishops are raising more than 1 million worms on their property — red wigglers, to be exact.)

As if that is not enough, Urban Organics also makes GardenSoxx, a self-contained mesh garden sys-

tem that the Bishops hope to eventually use in doing more outreach to schools.

While Urban Organics, with all of these efforts, is no doubt a green operation with a commitment to sustainability, Mr. Bishop is adamant that it’s more than that — it’s a good business and SweetPeet is a good, versatile product, he says.

“Our definition of a sustainable operation is for your business to run on its own,” Mrs. Bishop said.

“As far as we’re concerned, we have a sustainable operation … in more ways than one.”

■

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20110711-NEWS--18-NAT-CCI-CL_--

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SMALL BUSINESS

Be proactive to stymie Internet misuse Instituting Web policies should help minimize unproductive surfing

W

orkplace managers today know that social media, other online distractions and outright Internet misuse are depriving businesses of productive hours, draining bandwidth and jeopardizing company networks and reputations.

But what can they do about it?

First, how bad is the situation?

Studies show that the average employee spends between one and two hours a day using the Internet for personal reasons, indulging in activities such as accessing social networks, playing games, answering email, sending instant messages and even watching pornography and gambling.

According to uSamp, an online survey company, this translates into about $10,000 lost each year per employee.

What’s more, unauthorized web surfing uses up precious bandwidth and illicit downloading can both imperil a company’s computer network and tarnish its good name.

There are several ways to address the problem. Here are three basic solutions that can be applied separately or in combination: Internet

JONATHANHUSNI

ADVISER usage policy agreement; softwarebased content filtering; and appliance-based controls.

Internet usage policy I always recommend to my clients that their first order of business should be for human resources to institute an Internet usage policy agreement to be signed as a condition of employment by all staff members with web access. (There are several templates available on the Internet.)

By signing the agreement, employees promise that they will not use the Internet in an unacceptable way or create unnecessary risks to the company’s computer network or reputation.

Violations of the agreement would include unreasonable personal use of a computer, visiting websites containing obscene or hateful content, emailing offensive or harassing material, or downloading unauthorized software.

Employees failing to comply

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PROTECT YOUR COMPANY FROM INTERNET MISUSE Companies are challenged by employees’ potential misuse of the Internet, with social media and other online distractions contributing to productivity loss.

Here are five ways to protect your business from web misuse:

have already penetrated the firewall.

■ Install artificial content recognition software. It analyzes and classifies Web page material and compares it to your company’s usage policy.

■ Institute an Internet usage policy agreement to be signed as a condition of employment by all staff members with Web access.

■ Install appliance-based controls featuring a unified threat management architecture. It can transform your firewall into an all-inclusive security product.

■ Obtain a detailed audit of company Internet usage, measuring bandwidth and checking for the existence of any malware that might

■ Increase awareness and boost morale by involving employees in periodic discussions of the problem and soliciting their suggestions.

transforms the firewall into an allinclusive security product that can perform multiple security functions.

Content filtering These protections should Managing a business would be include, in addition to firewalling, easier if signing an agreement was network intrusion prevention, by itself a sufficient deterrent to gateway anti-virus and anti-spam, Internet misuse. content filtering, Unfortunately, load balancing human nature Each company has its own and on-applibeing what it is, corporate culture that ance reporting. sterner measures Load balancing determines what online often are called refers to the ability behavior is acceptable. for. of a network The next step edge appliance I recommend is to handle two or the installation of a filtering applimore connections to the Internet cation, such as artificial content simultaneously. On-appliance recognition (ACR) software. reporting refers to the ability of ACR analyzes the context of a the filtering appliance to furnish Web page, automatically classifies reports of activity directly to the it into categories such as shopping, managing user. sports, sex, gambling, violence, etc.

Each company has its own corand compares it to a company’s porate culture that determines what usage policy. online behavior is acceptable. SituSettings are flexible and can be ations vary but my experience shows adjusted as needed. The technology that some level of Internet behavior can cover the entire Internet in modification usually is needed. real-time with reasonable accuracy, When I am consulted by clients categorizing content the way a concerned about their vulnerability human being would. to Internet misuse, I will perform a Also available are applications full network audit to reveal who is that enable managers to make spedoing what online. cific websites off limits or enforce Depending on the seriousness of strict limits on what subjects search the situation, I will recommend engines may seek out. some combination of the above remedies; I am so confident of their Appliance-based controls effectiveness that in every case I A web filter appliance is a device guarantee results.

■ that enables companies to filter Mr. Husni is president of Acendex, online content, blocking or removing an information technology services links, downloads and email that may firm in Beachwood. Acendex is a contain offensive or dangerous consultancy that advises small and content. medium organizations on how to Ideally, Web filtering hardware achieve and maintain vital IT funcshould support a unified threat tionality. www.acendex.com. management architecture that would face disciplinary action, including dismissal.

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Dishes at Pura Vida, which means “pure life,” are made with fresh, local ingredients. The restaurant is open for breakfast, lunch and dinner, and it also can host private parties, cater or deliver breakfast or lunch to downtown offices.

216-987-0100 info@PuraVidaByBrandt.com

SMITH HOUSE CALLS P.O. Box 772 Berea 44017 www.smithhousecalls.com Dr. Rhonda Smith offers full-service in-home veterinary care for household pets in Cleveland’s western suburbs.

Dr. Smith and her technician will come to the patient’s home to provide a variety of pet services, including wellness exams, vaccinations, flea/heartworm prevention and more.

Procedures requiring more intensive care are offered through an affiliation with Emerald Animal Hospital in Cleveland.

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MUSE CONTENT GROUP 1165 Royalwood Road Broadview Heights 44147 MuseContentGroup.com Muse Content Group — headed by Jackie Bebenroth — is a marketing firm that is exclusively dedicated to the emerging field of content strategy and development. A collective of professional writers, photographers and videographers develop clever, costeffective social media posts, images and videos that keep client audiences educated and engaged. Strategic content services help clients maximize their investment by choosing the best content distribution methods to broaden reach and exposure for their businesses.

440-503-5322 Hello@MuseContentGroup.com To submit a new business, send the following information by email to Amy Ann Stoessel at astoessel@ crain.com: business name; address; city and ZIP; website; brief description of business; business phone number; business fax number; business email address; and date that business opened. Call 216-771-5155 with questions.

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19

HIGHEST PAID NON-CEOS RANKED BY 2010 COMPENSATION

Name Company Rank Title

Total compensation 2010 % 2009 change

Salary

Bonus

Stock awards

Option awards

Nonequity incentive plan

Change to pension value

Company net Company net income income % All other 2010 change from compensation (millions) 2009

1

Craig Arnold/Eaton Corp. vice chairman, COO, Industrial Sector

$4,652,533 $3,644,312

27.7

$637,290

$0

$1,207,934

$0

$2,324,075

$394,000

$89,234

$929.0

142.6

2

Thomas S. Gross/Eaton Corp. vice chairman, COO, Electrical Sector

$4,647,337 $3,905,467

19.0

$612,000

$0

$1,207,934

$0

$2,172,966

$570,481

$83,956

$929.0

142.6

3

Richard H. Fearon/Eaton Corp. vice chairman, chief financial and planning officer

$4,543,212 $3,579,123

26.9

$635,160

$0

$1,340,674

$0

$2,047,162

$419,822

$100,394

$929.0

142.6

4

Michael C. Arnold/Timken Co. exec. vp and president, Bearings and Power Transmission

$4,497,914 $1,825,986

146.3

$630,034

$0

$256,171

$611,226

$1,119,033

$1,818,000

$63,450

$274.8

NM

5

Gary R. Leidich/FirstEnergy Corp. exec. vice president and president, FirstEnergy Generation

$4,427,280 $4,844,524

(8.6)

$650,000

$0

$1,524,483

$0

$712,920

$1,514,811

$25,066

$784.0

-22.1

6

Darren R. Wells/Goodyear Tire & Rubber Co. executive vice president, CFO

$4,092,928 $2,453,960

66.8

$490,000

$0

$404,801

$450,002

$2,340,800

$377,450

$29,875

($216.0)

NM

7

Thomas L. Williams(1)/Parker Hannifin Corp. executive vice president, operating officer

$3,909,327 NA

NA

$504,925

$0

$1,295,386

$683,780

$543,589

$818,247

$63,373

$853.4

203.7

8

Lee C. Banks/Parker Hannifin Corp. executive vice president, operating officer

$3,776,326 $3,024,671

24.9

$504,925

$0

$1,295,386

$683,780

$543,589

$691,177

$57,469

$853.4

203.7

9

Curt J. Andersson(2)/Goodyear Tire & Rubber Co. president, North American Tire

$3,687,327 NA

NA

$459,375

$450,000

$909,993

$625,002

$1,062,500

$137,034

$43,423

($216.0)

NM

10

Marwan M. Kashkoush/Parker Hannifin Corp. exec. vice president, sales, marketing and operations support

$3,649,298 $2,822,313

29.3

$487,730

$0

$1,141,204

$612,465

$471,959

$809,044

$126,896

$853.4

203.7

11

Mark T. Clark/FirstEnergy Corp. executive vice president, CFO

$3,578,980 $3,771,287

(5.1)

$650,000

$0

$1,176,968

$0

$747,338

$988,592

$16,082

$784.0

-22.1

12

John G. Morikis/Sherwin-Williams Co. president, COO

$3,446,057 $3,393,867

1.5

$748,953

$0

$902,860

$683,296

$910,000

$0

$200,948

$462.5

6.1

13

Raymond F. Laubenthal/TransDigm Group Inc. president, COO

$3,115,735 $3,860,772

(19.3)

$364,375

$250,000

$0

$0

$0

$0

$2,501,360

$125.3

-18.6

14

Vincent C. Byrd/J.M. Smucker Co. president, COO

$3,108,168 $1,838,837

69.0

$500,000

$10,000

$735,000

$0

$600,000

$1,222,882

$40,286

$505.2

8.0

15

Glenn A. Eisenberg/Timken Co. executive vice president, finance and administration

$3,078,645 $1,644,154

87.2

$600,034

$0

$247,103

$496,395

$1,071,002

$594,000

$70,111

$274.8

NM

16

Joseph P. Palchak/Eaton Corp. president, Vehicle Group

$3,062,822 $2,443,216

25.4

$496,950

$0

$714,805

$0

$1,276,864

$532,468

$41,735

$929.0

142.6

17

Ronald A. Rice/RPM International Inc. president, COO

$3,037,837 $1,609,457

88.7

$600,000

$0

$1,406,206

$409,000

$485,000

$53,572

$84,059

$179.4

13.0

18

Leila L. Vespoli/FirstEnergy Corp. executive vice president, general counsel

$2,883,502 $3,107,170

(7.2)

$530,000

$0

$912,827

$0

$609,368

$797,386

$33,921

$784.0

-22.1

19

Jeffrey M. Weiss/American Greetings Corp. president, COO

$2,821,564 $2,552,346

10.5

$739,300

$0

$277,315

$472,709

$1,209,376

$65,681

$57,183

$87.0

6.7

20

Robert G. O'Brien/Forest City Enterprises Inc. executive vice president, CFO

$2,650,225 $1,446,455

83.2

$500,000

$325,000

$969,989

$359,997

$430,000

$5,776

$59,463

$58.7

NM

21

Sean P. Hennessy/Sherwin-Williams Co. senior vice president, finance, CFO

$2,570,877 $2,741,449

(6.2)

$571,640

$0

$602,982

$546,637

$697,000

$0

$152,618

$462.5

6.1

22

Salvatore J. Miraglia Jr. /Timken Co. president, Steel Group

$2,508,843 $1,624,957

54.4

$438,368

$0

$204,030

$434,006

$762,503

$618,000

$51,942

$274.8

NM

23

Steven J. Oberfeld/Sherwin-Williams Co. senior vice president, corporate planning and development

$2,424,655 $2,296,583

5.6

$521,680

$0

$554,614

$704,310

$528,000

$0

$116,051

$462.5

6.1

24

David J. Oakes/Developers Diversified Realty Corp. senior executive vice president, CFO

$2,339,400 $2,428,445

(3.7)

$440,000

$0

$1,163,661

$214,304

$487,620

$0

$33,815

($209.4)

NM

25

James Riley/TransDigm Group Inc. executive vice president

$2,248,175 $1,639,905

37.1

$260,000

$145,000

$0

$796,590

$0

$0

$1,046,585

$125.3

-18.6

26

John P. Sauerland/Progressive Corp.

Personal Lines Group president

$2,235,593 $1,535,832

45.6

$412,308

$0

$1,037,550

$0

$773,078

$0

$12,657

$1,068.3

1.0

27

Susan Patricia Griffith/Progressive Corp.

Claims Group president

$2,234,936 $1,535,832

45.5

$412,308

$0

$1,037,550

$0

$773,078

$0

$12,000

$1,068.3

1.0

28

Benjamin J. Mondics/Applied Industrial Technologies Inc. president, COO

$2,219,135 $1,199,297

85.0

$450,000

$0

$496,085

$235,834

$626,393

$354,224

$56,599

$86.2

241.9

29

Albert J. Rodriguez/TransDigm Group Inc. executive vice president, mergers and acquisitions

$2,194,055 $2,339,639

(6.2)

$228,875

$145,000

$0

$0

$0

$0

$1,820,181

$125.3

-18.6

30

Christopher M. Gorman/KeyCorp president, Key Corporate Bank

$2,192,236 NA

NA

$1,409,910

$0

$7,049,997

$0

$0

$26,124

$51,205

$554.0

NM

31

Thomas W. Seitz/Sherwin-Williams Co. senior vice president, strategic excellence initiatives

$2,152,479 $2,291,049

(6.0)

$481,927

$0

$296,654

$286,130

$458,000

$535,133

$94,635

$462.5

6.1

32

Mark O. Eisele/Applied Industrial Technologies Inc. vice president, CFO, treasurer

$2,089,544 $1,047,868

99.4

$438,000

$0

$333,538

$158,077

$525,600

$574,733

$59,596

$86.2

241.9

33

Brian C. Domeck/Progressive Corp. vice president, CFO

$2,088,858 $1,555,132

34.3

$421,538

$0

$1,062,532

$0

$592,788

$0

$12,000

$1,068.3

1.0

34

Donald J. Gallagher/Cliffs Natural Resources Inc. executive vice president, president, global commercial

$2,071,069 $1,396,056

48.4

$439,750

$0

$733,542

$0

$494,369

$382,220

$21,188

$1,019.9

397.3

35

Steven Oakland/J.M. Smucker Co. president, International, Foodservice and Natural Foods

$2,039,409 $1,250,252

63.1

$400,000

$12,000

$504,000

$0

$396,000

$705,089

$22,320

$505.2

8.0

36

Bradley C. Richardson/Diebold Inc. executive vice president, CFO

$1,970,717 $1,176,005

67.6

$485,000

$0

$404,260

$239,750

$615,465

$0

$226,242

($20.3)

NM

37

Charles E. Jones(3)/FirstEnergy Corp. senior vice president and president, FirstEnergy Utilities

$1,945,013 NA

NA

$508,077

$0

$904,255

$0

$519,042

$634,952

$13,638

$784.0

-22.1

38

Charles E. Jarrett/Progressive Corp. vice president, secretary, chief legal officer

$1,939,369 $1,533,108

26.5

$410,000

$0

$902,024

$0

$615,000

$0

$12,345

$1,068.3

1.0

39

William P. Richgels/FirstMerit Corp. executive vice president, chief credit officer

$1,914,199 $1,116,935

71.4

$361,050

$126,970

$347,993

$0

$352,274

$653,093

$72,819

$102.9

25.2

40

Thomas C. Stevens/KeyCorp vice chair, chief administrative officer

$1,909,601 $2,440,060

(21.7)

$1,214,868

$0

$584,998

$0

$0

$39,867

$69,868

$554.0

NM

41

John J. Keane/Nordson Corp. senior vice president

$1,881,163 $1,365,101

37.8

$318,000

$0

$403,270

$264,556

$445,200

$431,059

$19,078

$187.2

NM

42

Laurie Brlas/Cliffs Natural Resources Inc. exec. vice president, global administration and finance, CFO

$1,878,742 $1,206,550

55.7

$445,412

$0

$756,241

$0

$550,654

$95,495

$30,940

$1,019.9

397.3

See LIST Page 20

20110711-NEWS--20-NAT-CCI-CL_--

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CRAIN’S CLEVELAND BUSINESS

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JULY 11 - 17, 2011

HIGHEST PAID NON-CEOS RANKED BY 2010 COMPENSATION

Total compensation 2010 % 2009 change

Name Company Rank Title

Salary

Bonus

Stock awards

Option awards

Nonequity incentive plan

Change to pension value

Company net Company net income income % All other 2010 change from compensation (millions) 2009

43

Jeffrey B. Weeden/KeyCorp CFO

$1,875,231 $2,359,684

(20.5)

$1,214,882

$0

$584,998

$0

$0

$16,469

$58,882

$554.0

NM

44

Frederick G. Stueber/Lincoln Electric Holdings Inc. senior vice president, general counsel, secretary

$1,873,282 $1,463,294

28.0

$357,396

$0

$155,949

$169,254

$413,509

$736,586

$20,588

$130.2

168.1

45

Mark R. Belgya/J.M. Smucker Co. senior vice president, CFO

$1,856,506 $1,053,216

76.3

$330,000

$6,800

$426,000

$0

$408,000

$676,259

$9,447

$505.2

8.0

46

Charles E. Ducey Jr./Diebold Inc. executive vice president, North America operations

$1,788,593 $1,102,582

62.2

$357,509

$0

$362,440

$143,850

$376,253

$493,583

$54,958

($20.3)

NM

47

William A. Brake/Cliffs Natural Resources Inc. executive vice president, global metallics

$1,774,604 $1,178,945

50.5

$427,750

$0

$732,578

$0

$463,716

$110,740

$39,820

$1,019.9

397.3

48

Barry C. Dunaway/J.M. Smucker Co. senior vice president, chief administrative officer

$1,767,515 NA

NA

$330,000

$6,800

$426,000

$0

$408,000

$587,233

$9,482

$505.2

8.0

49

Michael P. Brogan(1)/Nacco Industries Inc. president, CEO, NMHG

$1,759,434 $869,530

102.3

$565,866

$0

$0

$0

$985,160

$159,912

$48,496

$79.5

155.6

50

John W. Beeder/American Greetings Corp. senior vice president, executive sales and marketing officer

$1,749,073 $1,727,753

1.2

$483,334

$0

$131,270

$231,377

$741,473

$71,798

$89,821

$87.0

6.7

51

Terrence E. Bichsel/FirstMerit Corp. executive vice president, CFO

$1,747,347 $1,346,660

29.8

$361,050

$126,970

$347,993

$0

$352,274

$514,281

$44,779

$102.9

25.2

52

Gregory H. Trepp(1)/Nacco Industries Inc. president, CEO, HBB

$1,705,023 NA

NA

$494,952

$0

$0

$0

$1,102,800

$13,466

$93,805

$79.5

155.6

53

Robert L. Benson/Nacco Industries Inc. president, CEO, North American Coal

$1,690,852 $1,629,033

3.8

$442,950

$0

$0

$0

$867,586

$236,295

$144,021

$79.5

155.6

54

Stephen J. Knoop/RPM International Inc. senior vice president, corporate development

$1,614,332 $820,694

96.7

$335,000

$0

$729,366

$122,700

$335,000

$45,643

$46,623

$179.4

13.0

55

Paul G. Hoogenboom/RPM International Inc. senior vice president, manufacturing and operations, CIO

$1,597,696 $845,817

88.9

$346,000

$0

$737,121

$122,700

$300,000

$47,556

$44,319

$179.4

13.0

56

Vincent K. Petrella/Lincoln Electric Holdings Inc. senior vice president, CFO, treasurer

$1,578,819 $1,419,349

11.2

$367,188

$0

$196,658

$213,920

$496,211

$274,055

$30,787

$130.2

168.1

57

Michael L. Goulder/American Greetings Corp. senior vice president, executive supply chain officer

$1,562,515 $1,766,120

(11.5)

$489,678

$0

$105,016

$185,103

$672,857

$60,371

$49,490

$87.0

6.7

58

Bernard Rzepka/A. Schulman Inc. general manager, COO, Europe

$1,547,618 $1,033,524

49.7

$463,661

$0

$0

$0

$320,901

$738,375

$24,681

$50.0

409.2

59

Ronald A. Ratner/Forest City Enterprises Inc. executive vice president

$1,529,189 $987,883

54.8

$450,000

$150,000

$71,998

$365,991

$415,000

$14,157

$62,043

$58.7

NM

60

James A. Ratner/Forest City Enterprises Inc. executive vice president

$1,527,306 $983,772

55.2

$450,000

$150,000

$71,998

$365,991

$415,000

$6,977

$67,340

$58.7

NM

61

Fred D. Bauer/Applied Industrial Technologies Inc. vice president, general counsel, secretary

$1,523,908 $677,565

124.9

$355,000

$0

$242,765

$115,353

$376,300

$400,058

$34,432

$86.2

241.9

62

George E. Strickler/Stoneridge Inc. executive vice president, CFO, treasurer

$1,504,923 $512,392

193.7

$340,688

$0

$432,500

$0

$378,400

$0

$353,335

$10.8

NM

Source: Company proxy statements. 2010 net income and net income % change provided by Compustat, www.compustat.com. 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. The Book of Lists and enhanced versions of most lists, with more companies, are available to purchase at www.crainscleveland.com.

(1) Not a named executive officer for 2009.

(2) Mr. Andersson was named president, North American Tire effective Feb. 16, 2010.

(3) Mr. Jones was named senior vice president and president, FirstEnergy Utilities on April 1, 2010.

Mowry: Disorganization plagues department continued from PAGE 3

who work at the county’s Information Services Center, which serves all county agencies, with another 96 who work for those agencies. The center, the closest thing the county has to a centralized IT department, lost its director, Dan Weaver, about a year ago, after he was indicted on bribery charges as part of the corruption scandal that has ensnared dozens of county officials and business people.

“We’re going agency by agency by agency,” Mr. Mowry said.

That decentralized structure has created all sorts of problems, he said. For instance, county agencies typically bought their own hardware and software, so one agency’s software often doesn’t work with programs run by another agency.

Mr. Mowry said the county administration building alone has four computer networks, each requiring different log-in passwords.

The structure also drove the agencies to focus on narrow IT projects instead of broader, countywide goals, said Mr. Mowry, who also spent nearly 20 years as an IT executive within DaimlerChrysler, eventually becoming CIO of its Detroit Diesel subsidiary.

Plus, because agencies did their own purchasing, they missed out on discounts organizations often get when buying big numbers of products or software licenses, he said.

“Now we have to think as an enterprise instead of an agency,” Mr. Mowry said.

Where’s the help desk?

There are other problems, too, such as a lack of consistent management goals and performance metrics, weak disaster recovery and succession plans, and a county IT board that approves almost all major purchase requests that come its way.

“We don’t even have a help desk here,” he said, noting that he plans to address all those issues.

Many of the county’s IT problems were cited in a report issued last September by the Information Technology Task Force, part of the Cuyahoga County Transition Advisory Group. The group was formed to help the county move from a traditional form of government with three county commissioners to one led by an executive and a county council — a response to the same scandal that ensnared Mr. Weaver.

He pleaded guilty twice, in August 2010 and again last week, to

charges that he conspired to bribe then-County Auditor Frank Russo.

The task force’s report said a restructured IT department under a CIO would allow the county to do more while also saving $8.3 million annually, after new expenses are taken into account. The savings would be achieved mainly through consolidating the county’s IT teams and the hardware they use. The figure includes $1.5 million in savings achieved through the elimination of “duplicative roles,” the report stated.

Mr. Mowry, who makes $178,000 a year, said he expects there to be staff reductions, but added that he doesn’t yet know how many. The task force’s annual savings estimate is realistic, he said.

A matter of execution Many of Mr. Mowry’s goals match those set by the task force, which was led by John Hunter, who became director of the county Information Services Center after Mr. Weaver’s troubles began, and Bill Blausey, CIO of Eaton Corp., the Cleveland-based manufacturing company.

In addition to consolidating the IT department, a process that started in May, one of Mr. Mowry’s main

goals is to install a system that will allow the county to post its contracts and purchase orders online, which is mandated by county ordinance.

“That’s a big project for sure, because of the ethics issue,” Mr. Mowry said.

The county also is reviewing its existing software to see if it makes sense to buy an enterprise resource planning system for managing internal processes across all county agencies. Such an investment could cost between $10 million and $50 million, he said.

Another goal is to generate more revenue for the county by providing services to other government entities. For instance, the county’s website development team — which both Mr. Mowry and the task force report described as one of the county’s existing strengths — already provides services to a few area municipalities.

Mr. Blausey, who helped lead the task force, interviewed Mr. Mowry when he was under consideration for the position. Mr. Blausey said one of Mr. Mowry’s strengths was that he had experience managing IT departments in private industry and government.

■

RESEARCHED BY Deborah W. Hillyer

ON THE WEB

Story from www.CrainsCleveland.com.

PE firm Cyprium makes investment Cleveland private equity firm Cyprium Investment Partners LLC said it has made a subordinated debt and equity investment in Network Hardware Resale, a Californiabased supplier of new and used IT networking equipment.

Cyprium focuses on non-control investments in privately held companies in the United States and Canada. It said the investment will enable the Santa Barbara, Calif., company to “refinance existing indebtedness while providing capital to further fuel efforts relating to the next phase of the company’s expansion.”

John Sinnenberg, chairman of Cyprium, said Network Hardware “represents a compelling investment opportunity” for the Cleveland firm. The investment and finance teams at Key Principal Partners in Cleveland resigned from that firm and on June 1 formed Cyprium as an indepen— Scott Suttell dent entity.

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Cardinal: Bank, company realign relationship continued from PAGE 3

employment level before the Chapter 11 filing in U.S. Bankruptcy Court in Cleveland. Court documents indicate the company had been maintaining its facilities with a skeleton staff of employees, friends and family members of Mr. Grabner who volunteered their time, even as Cardinal temporarily suspended the bulk of its manufacturing operations.

That situation lasted only a few days, while Cardinal and its chief lender, Wells Fargo, haggled over whether the company could access its cash accounts with the bank, Mr. Grabner said. Once an agreement was reached last Tuesday, July 5, to allow Cardinal to access those funds, manufacturing operations resumed, Mr. Grabner said.

The troubles But employment at the company is still way down. It had about 50 employees before filing for bankruptcy and had 64 at its peak in 2010, Mr. Grabner said. In between, a lack of access to working capital caused the company to shrink employment and kept Cardinal from growing the way it wanted, especially in the wind industry, he said.

Most employees were told to go home June 17, when Wells Fargo pulled Cardinal’s line of credit and cut off Cardinal’s access to its cash with the bank, leaving the company unable to make payroll, according to court filings. Cardinal owes Wells Fargo about $1.16 million, bankruptcy documents show.

For its part, Wells Fargo was reacting to Cardinal’s violation of some of its loan covenants, including a failure to meet profitability standards required under its loan agreement, court documents state. Wells Fargo in August 2010 cited Cardinal for being in default, the company told the Bankruptcy Court, but the manufacturer was able to work with the bank under a forbearance agreement until May of this year. It was then that Wells Fargo reduced

the amount of money Cardinal could borrow as well as the amount of cash the company could be advanced based on the value of its machinery and equipment.

“As a result, Cardinal entered into an over-advanced position under the working capital line of credit as of May 30, 2011,” Cardinal wrote in a June 30 motion. “Based on this default condition, Wells ceased providing additional advances and prohibited Cardinal from using the proceeds from its cash collections.

Throughout this time, Cardinal never missed a payment of principal or interest to Wells Fargo.”

But Cardinal might have done something worse, as court documents show it made a significant accounting error that affected both the valuation of the company and its profitability.

According to the company’s court filings, Cardinal had to reclassify $1.7 million in inventory as “property, plant and equipment” and had to reclassify another $1 million in inventory as expenses related to the company’s expansion into the wind energy industry.

Cardinal informed Wells Fargo of the accounting issues in May. That month, the bank indicated it wanted to liquidate Cardinal’s assets to collect on its loans to the company and began sweeping money out of Cardinal’s accounts, “leaving Cardinal largely unable to pay day-to-day business expenses,” according to a court filing. In mid-June, Cardinal was unable to pay employees, causing it to lay off 34 workers and to idle its plant.

Back up and running Since then, however, the two sides have reached an agreement under which Cardinal again can access its cash with the bank and can resume operations under a mutually agreed-upon budget, said Christopher Meyer, an attorney with Squire, Sanders & Dempsey in Cleveland who represents Wells

Fargo in the case.

As to what caused Cardinal to fall out of compliance with its loan covenants in the first place, Mr. Grabner said it was general business conditions and not the result of either the accounting error or a lack of growth or profitability in its wind business.

“We were the only company, apparently, to lose money in 2009,” Mr. Grabner quipped, jokingly referring to a year in which many, if not most, American manufacturers lost money as the economy dove into a deep recession.

Cardinal’s court documents state that its wind business continued to grow, driving overall company sales growth of 38% in 2010 compared with 2009. Mr. Grabner said while foreign competition is affecting some aspects of the wind industry, he so far has not seen it in the bolts business.

“To the best of my knowledge, there are no Chinese fasteners in these things,” he said.

“The problem isn’t the wind industry or federal policies” related to that industry, Mr. Grabner said.

“It’s more an issue of the banking environment in our country. …

Banks are not supporting small businesses.”

Mr. Meyer tells a different story.

He said both business conditions and the accounting problem contributed to Wells Fargo’s decision to move on Cardinal and to seek a liquidation of its assets.

“It’s not just a question of an accounting snafu,” Mr. Meyer said.

“There were defaults under the lending agreement related to their operations.”

However, Mr. Grabner said the losses took place in 2009 and were small. The company since has

returned to and maintained its profitability, he said.

“We’re positive cash flow, we have been positive cash flow, and we have profitable operations,” Mr. Grabner said.

Bright past, hopeful future Nonetheless, the company’s present situation is a far cry from just two years ago.

President Barack Obama visited Cardinal in 2009 and held it out as an example of a U.S. manufacturer lifted by the nation’s increasing development of wind energy. In its Chapter 11 filing, Cardinal notes that, after the visit by President Obama, “Cardinal became a national face for American manufacturing and job growth.”

In 2010, the company was named “Supplier of the Year” by the American Wind Energy Association.

Now, time will tell if Cardinal can reclaim that role.

One reason buyers and investors are interested, Mr. Grabner said, is because they say they want Cardinal’s position in the wind industry. That position tends to rely upon local or regional suppliers whenever it can, giving Cardinal a strong opportunity to grow further in the American wind energy market.

Mr. Grabner said he hopes the bankruptcy will be short.

“My goal is to run the company and continue to build it and to make sure everyone gets paid from this,” he said.

Mr. Meyer said a short bankruptcy probably would make creditors happy as well.

“I hope it’s not going to be a long, drawn-out bankruptcy,” Mr. Meyer said. “It’s in everyone’s interest to preserve the value of the company.” ■

ON THE WEB

Story from www.CrainsCleveland.com.

Study: Business relocations fuel Cleveland sprawl A study that claims to be the largest ever done in the United States of subsidized business relocations indicates that property tax breaks given to entice companies to move within the Cleveland area have worsened wealth inequities in the region and have fueled suburban sprawl.

The study, released by the nonprofit research center Good Jobs First and financed by the Ford Foundation, is titled, “Paid to Sprawl: Subsidized Job Flight from Cleveland and Cincinnati.”

The study cites 164 companies that were given what it called “lucrative property tax breaks” as they moved facilities around the Cleveland and Cincinnati metro areas. Good Jobs First said the subsidized relocations, affecting an estimated 14,500 workers, “were overwhelmingly outward bound and by many measures fueled suburban sprawl, especially in the Cleveland region.

“By dispersing jobs away from the urban cores, the relocations worsened inequalities in wealth and opportunity,” the nonprofit said.

To address the problems created by the tax breaks, the study recommends that the state encourage anti-poaching agreements like those in effect in Summit County and that are under consideration now in Cuyahoga County.

LEAN SIX SIGMA GREEN BELT For Healthcare Professionals Program Begins August 8

Taught by Nationally Recognized Expert Jennifer Ralston ■

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Jennifer worked with the American Red Cross, Genetech, Merck Pharmaceuticals, The Army, Reston Hospital, Medical College of Virginia, and other organizations in Lean Six Sigma implementation.

$2,395 Per Person

Visit CorporateCollege.com/LSS for information and to register online.

866-933-5167

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Toni Coleman (216) 522-1383 (216) 694-4264 tcoleman@crain.com

OFFICE/WAREHOUSE Eastlake Approximately 7,000 and 30,000 square feet of warehouse space for rent.

Will subdivide. Truck dock available. Easy access to State Route 2. $2.50/square foot including utilities.

Call 440-946-4767 for details.

INVESTMENT PROPERTY FORECLOSED HOMES In good suburbs <$30k.

Builder (w/ 20+ Yrs. Exp) specializing in foreclosed homes – CAN HELP YOU! Buy at BARGAIN price & REHAB completely for a Very Reasonable Price!

We’ll assist you through every step for a GREAT RETURN!

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

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LUXURY PROPERTIES

WAREHOUSE FOR LEASE

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Will divide. Crane, 2 Truck Loading Docks, near I-490.

216.751.3836 CT.HOPSON@GMAIL.COM

Once in A Lifetime Opportunity

FOR SALE

COUNTRY RETREAT FOR SALE GEAUGA COUNTY

Special offering of the most elegant and nationally known double two-bedroom condo at One Bratenahl Place including all furnishings.

World-class European antiques, contents and appointments from a 40-year fine arts collection. Call 216-451-2161 or visit:

RECEIVER ORDERED

Secluded, wooded, one-of-a-kind, country retreat in southern Geauga County, 50 acre wildlife haven, 5 minutes to main highway, 3450 sq. ft. 2 story home, central air, 4 bedroom, 4½ bath, extraordinary woodwork throughout, low maintenance exterior, complete living quarters, including kitchen & full bath in finished basement.

SALE Marcella Arms Apartments 61 Units.

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$1,420,000 W. Greg Reed, Receiver

Elevator to all floors, back-up generator, 3 car plus attached garage, 24’x24’ storage bldg, 12’x14’ shed, gated driveway, several stocked ponds, Property backs up to the Cuyahoga River, bordered on sides

by City of Akron owned land which guarantees privacy. $795,900.

Only qualified or bank certified buyers need apply. Send contact information to P.O. Box 1328, Middlefield, Ohio 44062.

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www.clevelanddreamcondo.com Come enjoy the gorgeous Lake Erie sunsets from your own 2006 built home.

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CLASSIFIED PUBLIC NOTICE The Jointly Administered Trust Fund for the Benefit of Lorain City School District Employees is requesting quotes from qualified insurance carriers and/or third party administrators to administer its employee health benefits programs which include medical, pharmacy, dental and vision benefits. Additionally, proposals are invited for wellness, disease management and population management programs. Interested parties can bid on any one or a combination of the above services and programs.

Interested parties should contact Jeff Smith directly for a copy of the request for proposal documents.

Jeff Smith, MAAA, FCA Milliman, Inc. 1335 Dublin Road, Suite 209B Columbus, OH 43215 jeff.smith@milliman.com 614.481.3205

BUSINESS SERVICES USA Mobile Drug Testing is your company’s single source solution for drug testing and compliance needs.

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Let USAMDT help you: Get in compliance, stay in compliance, Maintain a safe and drug-free workplace and save money Cleveland: 440/653-5003 or kakitchen@usamdt.com Cleveland South: 440/385-6740 or jgorman@usamdt.com

BUSINESSES FOR SALE Business & Real Estate For Sale Investors & Owner/Operators Wanted

Lake County 25-Bed Profitable Assisted Living Facility

$996,250

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For information on these Confidential Listings Contact: Oreste Realty LLC Chris Foley (614) 915-8835 cfoley@SeniorsFamily.com

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The University of Akron Director, UA Lakewood Location Lakewood, OH Director is responsible for the operation, organizational management, enrollment (credit and non-credit), and community engagement of The University of Akron Lakewood. A relevant Bachelor’s degree & 6 years management/leadership experience required.

For complete information on duties, qualifications & to apply visit www.uakron.edu/jobs. Requisition #6774. EEO/AA.

Director for Grants, Research and Development

Proposals are due no later than 4:00 pm (EDT) Tuesday, August 2, 2011. Potential bidders should not contact The District or any of The District employees directly.

Assisted Living

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BUSINESS SERVICE OWNERS!

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Notre Dame College is seeking a Director for Grants, Research and Development. The successful candidate will have a demonstrated ability in successful researching and writing grant proposals; a basic knowledge of funding opportunities in higher education; creative program development skills; superior writing and editing skills; a basic knowledge of local foundations and program officers who offer support to educational institutions.

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23

THEINSIDER

THEWEEK

REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS

JULY 4 - 10

That man is Zell, and he’s back in NE Ohio

For-profit South U. looks to head north

Skoda Minotti, Hilty Moore hook up

The big story: A local investor is at the helm of a group that has bought for an undisclosed price the former General Motors transmission plant in Parma. The ownership group, 54 Chevy LLC, is co-managed by Joseph Greenberg, an industrial real estate broker in Solon who operates Greenberg Realty Advisors and handles brokerage for Chelm Properties in Northeast Ohio. Mr. Greenberg said the former transmission plant can become home to companies as small as 50,000 square feet or that want the entire building, which is 527,000 square feet. The former transmission plant was one of three former GM properties sold in separate transactions by The RACER Trust. The others are in Moraine, Ohio, near Dayton, and Wyoming, Mich.

■ Sam Zell, the famed Chicago investor more successful as a real estate bottom-fisher than media magnate, again is investing in Northeast Ohio’s property market.

Equity Investment Co., the vehicle for Mr. Zell’s personal real estate investments, last month acquired the Courtyard by Marriott in Willoughby for $6.7 million, according to the Lake County auditor’s office.

Typical of a deal by Mr. Zell, the seller — TIC CY Willoughby LLC, an investor group led by Moody National Cos. of Houston — had shelled out $15.3 million for the 90-room inn in 2007, the last time it changed hands.

Terry Holt, a spokeswoman for Equity, said in an email that the company has been active recently in recapitalizing hotels. She said the Willoughby hotel is the only investment the privately held Equity concern owns in Northeast Ohio. Equity Residential, the Chicago-based, publicly traded apartment company formed by Mr. Zell, also owns nothing in the region, according to its website.

Mr. Zell, long known in real estate circles as the “grave dancer” for making big bets on sour deals to reap sweet profits later, returns to the region to pick through the detritus of the 2008 financial crisis. His former holdings in the region ranged from Lakewood to Mentor and included apartment, hotel, retail and office properties. — Stan Bullard

■ A for-profit college with campuses primarily in the southern part of the country is poised to open a location in Cleveland Heights, though the school is mum on the details.

Georgia-based South University is recruiting a campus president, a campus dean and a senior director of admissions for a Cleveland Heights location, according to postings on HigherEdJobs.com.

However, Heather Askew, assistant chancellor for communications at the university, said in an email that “while preliminary steps are under way (such as postings employment opportunities), I am not able to confirm any additional details about the university’s pending arrival in Ohio until all necessary regulatory approvals to operate in the state are secured.”

South University has 11 campuses across the country, including sites in Austin, Texas; Richmond, Va.; Montgomery, Ala.; and Novi, Mich. The university offers associates, bachelor’s and master’s degree programs in a number of fields, such as nursing, information technology, paralegal studies and graphic design.

Education Management Corp. in Pittsburgh, the college’s parent company, also operates Brown Mackie College, which has campuses in Akron and North Canton. — Timothy Magaw

■ The menu of services offered by Skoda Minotti has grown by way of acquisition.

The CPA, business and financial advisory firm, with offices in Mayfield Village and Fairlawn, has acquired Chagrin Falls marketing firm Hilty Moore & Associates and Hilty Moore’s visual marketing division, BrandEyeD. Terms of the June deal were not disclosed.

The merger affords Skoda Minotti capabilities it didn’t have before, including market research and visual marketing, said Jonathan Ebenstein, managing director of marketing services. The additions mean Skoda Minotti now has the expertise to assist clients in understanding the markets they serve and in retail planning and design branding, Mr. Ebenstein said.

A few members of Hilty Moore have joined Skoda Minotti’s staff, which numbers about 135. They include John Moore, who co-founded the acquired company. Hilty Moore typically employed between a halfdozen and eight people, Mr. Moore said.

Mr. Moore said he was attracted to joining Skoda Minotti because of the added services for his clients, which include accounting, tax planning and information technology services.

“I saw a real opportunity for growth for my business just having the resources that Skoda provides,” said Mr. Moore, now managing director of strategic marketing programs. “Second, I looked at how I could enhance the services that Skoda currently provides.” — Michelle Park

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German engineering:

OM Group Inc. of Cleveland signed a definitive agreement to buy Vacuumschmelze GmbH & Co. (VAC) of Hanau, Germany, a producer of advanced materials and specialty magnetics, for about $1 billion. VAC was founded in 1923 and has production operations in China, Finland, Germany, Malaysia and Slovakia, with sales offices in 16 countries. The company employs 4,500 people globally, including 160 scientists and engineers. Excluding one-time items related to the acquisition, OM Group said, it expects the acquisition to be accretive to earnings in fiscal 2011.

Exploring space: The Cleveland Metropolitan School District is looking for new office space to house its central office staff and possibly will auction its longtime headquarters building at 1380 E. Sixth St. near the Cleveland Medical Mart and Convention Center construction site. The district released requests for proposals for new space. Options include finding space in a downtown office building or renovating either East or South high schools — two recently closed schools. Weston Development Co. will handle both the relocation effort and possible auction of the district’s current headquarters.

A numbers guy: Energy Focus Inc. hired the former chief financial officer of Keithley Instruments Inc. as its vice president of finance and CFO. The Solon-based producer of energy-efficient lighting products said Mark Plush brings to his new job more than 28 years of financial management experience with Keithley Instruments, a maker of sophisticated measurement instruments where he was CFO for 12 years.

Keithley was acquired late last year by Danaher Corp.

Name that team: The great mystery surrounding the Cleveland Cavaliers’ next NBA Development League affiliate was solved. After the team last month ended its relationship with the Erie (Pa.) Bayhawks — its affiliate for three years — and subsequent rumors about buying a team and locating it in Youngstown, the Cavaliers acquired the New Mexico Thunderbirds and will move them to Canton. The team will play its games at the Canton Memorial Civic Center. Fans are invited to suggest names by visiting www.CantonNBA.com.

This and that: The Riverside Co. sold a Des Plaines, Ill., manufacturing company for what it termed a “solid” return of $3.50 for every dollar invested. Terms of the sale of Justrite Manufacturing Co. were not disclosed. The buyer was Baird Capital Partners. … TravelCenters of America LLC opened a Petro full-service travel center in Raphine, Va. Westlake-based TravelCenters said the new Petro features 250 truck parking spaces, 16 fueling lanes, 11 private showers and a 175-seat Iron Skillet Restaurant.

Excerpts from recent blog entries on CrainsCleveland.com

COMPANY: Master Manufacturing Co., Cleveland PRODUCT: ReStor-It Quick 20 repair kits The company says its ReStor-It line extends the useful life of office furniture — and does it pretty fast, too.

“Each ReStor-It Quick 20 repair kit allows easy repair of moderate furniture and seating damage in 20 minutes,” Master Manufacturing says. Compounds are applied simply, without the need for heat, and they dry within 20 minutes. To match colors and grains, each kit comes with seven intermixable colors, a color mixing guide, mixing cups and an applicator, according to the company.

For repair of moderately damaged furniture, flooring, paneling or other hard surfaces, the company says the Quick 20 FixA-Chip repair kit fixes chips, cracks, scratches, blemishes, imperfections and burn holes.

The Quick 20 Leather/Vinyl Repair Kit repairs burns, holes, rips, and tears on leather and vinyl. For repair of damaged fabric upholstery common in seats, sofas, chairs, and booths, the Quick 20 Fabric Upholstery Repair Kit’s color fabric fibers allow repairs to any color fabric upholstery.

The company, founded more than 50 years ago, is a certified Women’s Business Enterprise.

For information, visit www.MasterMfgCo .com/restorit.html.

Northeast Ohioans stay loyal to their carmaking heritage ■ If you’re trying to convince a consumer to buy an American car, Cleveland is one of the best places to do it.

That was the conclusion of CarGurus .com, an auto research and shopping site, which for the last six months has tracked the behavior of consumers using its flagship DealFinder car shopping service. CarGurus .com then ranked 50 U.S. metro areas according to the percentage of total dealer inquiries submitted by consumers that were for American-brand cars.

It’s no surprise that the city with the highest percentage of inquiries about American cars, 67%, was Detroit. (It was tied with St. Louis.) Cleveland was third, with 59% of buying inquiries for American brands, while just 29% were for Asian brands and 12% were for European brands.

The metro areas with the lowest relative interest in buying American-brand cars all were on the West Coast: Los Angeles (27% American car brand interest), San Francisco (27%), and Really?

San Diego (27%).

For the full Hamptons experience, get there in style ■ The Wall Street Journal really likes its new Jet Tracker database — almost as much as Randy Lerner likes flying to the Hamptons.

The newspaper has been writing quite a few stories of late stemming from the database. One of the more lighthearted efforts looked at what The Journal calls “the sliver

of the Hamptons crowd that can afford to bypass the chronically congested roadways on corporate-owned private jets.”

It turns out the most frequent flier to the Hamptons is a jet owned by the Cleveland Browns, with 390 trips to East Hampton in the four-year period (Jan. 1, 2007, to Jan. 1, 2011) examined by The Journal. Mr. Lerner, owner of the team, maintains an estate in Amagansett Lanes on East Hampton.

“More than 60 of the flights by the Browns-owned plane that landed in East Hampton originated from either New York’s LaGuardia or Teterboro in New Jersey — a pricey way to travel a fairly short distance,” The Journal said.

Hell frozen over: Cleveland’s weather an advantage ■ When it comes to climate change, Cleveland is in a very good place.

In a piece that ran on environmental news website Grist .org, writer Jeff Opperman ranked cities based on their resilience to climate change.

Factors considered were disruptions to water supplies, increased risk of natural disasters (such as floods and hurricanes), and heat itself.

By these standards, the five U.S. cities that are most resilient/least vulnerable to climate change are, in order, Cleveland, Milwaukee, Detroit, Chicago and Minneapolis. The least resilient cities are Phoenix, Houston, Sacramento, Las Vegas and Miami.

Why do Rust Belt cities do so well?

“They have a sustainable water supply; their heat stress rankings are relatively low; and they are less vulnerable to natural disasters that will be exacerbated by climate change, such as floods, landslides and wildfires,” Mr. Opperman wrote.

20110711-NEWS--24-NAT-CCI-CL_--

7/8/2011

11:06 AM

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