Crain's Cleveland Business

VOL. 39, NO. 7

FEBRUARY 12 - 18, 2018

Source Lunch

Akron Software Guild founders are launching IT training center. Page 14

The List Largest philanthropic gifts in region Page 24

CLEVELAND BUSINESS

SPORTS BUSINESS

Mark Masuoka, Akron Art Museum executive director Page 27 FINANCE

Tax reform brings new challenges in PE sector

By JEREMY NOBILE jnobile@crain.com @JeremyNobile

Illustration by Daniel Zakroczemski for Crain’s

The Zips aren’t playing around Akron joins a growing group of schools that see ‘substantial’ potential in esports Entire contents © 2018 by Crain Communications Inc.

By KEVIN KLEPS

FOCUS: HIGHER ED

kkleps@crain.com @KevinKleps

Creating a buzz: New facility will be a learning “Hive” at Lakeland Community College. Page 10

When University of Akron president Matthew J. Wilson heard that the NCAA was embarking on a study of the esports landscape, he asked vice provost for strategic initiatives Sarah M.R. Cravens what she knew about the burgeoning industry.

Her reply: “Give me 24 hours.”

What Cravens found is an industry that, according to various estimates, has zoomed past the $1 billion mark and could top $2 billion in three years.

“I agreed immediately that we

Not “predictable” anymore: Oberlin adjusts to a new reality. Page 11

should get involved with it,” said Cravens, who is also the interim dean of the Williams Honors College and a professor of law at the university. “I also found out immediately that our students were already in that space, and it was something that if we found the right ways in, we would make our current students very happy.”

SEE ESPORTS, PAGE 7

At a time when the private equity sector is navigating an increasingly competitive landscape for deals, striving to maintain the strong returns that have helped draw record levels of investor dollars in recent years, the jury remains out on whether the new tax law is a blessing or a curse.

It may be neither. In many ways, it’s just another nuance added to the myriad complexities of the industry that are driving innovation in the dealmaking process.

“One comment I hear from firms is to just remain disciplined,” said Craig Glazer, a Cleveland-based partner with Ernst & Young who leads its private equity business in the central region. “You want to act quickly and be there (for a great deal) first, but you also don’t want to go and make brash decisions. It may pay to act fast, but it also pays to stay true to your strategy and management teams.

And if the world wasn’t moving fast already, you throw this on top of it.”

Tax reform was highly anticipated, yet the corresponding bill is incredibly complex and evolved many times before ratification. Since its passage in December, private equity firms and their advisers have been working long days trying to determine how it could affect them, their outlooks for deals and their portfolio companies.

Those funds’ investors (limited partners) are looking to their fund managers for answers to the same questions.

In terms of making the United States more competitive in a business sense, the new codes are a positive, said Stewart Kohl, co-CEO of The Riverside Co., a global private equity firm and the largest with a headquarters here.

“But the negative view is that changes were being made quite rapidly with very little thoughtful analysis of the long-term consequences,” he said. “The best firms in the world are still today trying to understand what all the implications are. The degree of uncertainty is very high.”

At the same time, the tax bill itself won’t be a big change to the private equity business, Kohl said, as it’s just “another” change at a time when change for that industry is constant.

SEE PE, PAGE 6

PA G E 2

|

CRAIN’S CLEVELAND BUSINESS

F E B R U A RY 12 - 18 , 2 018 |

UH Ventures looks to enourage innovation

By LYDIA COUTRÉ lcoutre@crain.com @LydiaCoutre

Looking to provide patients with complex, chronic diseases quicker access to costly medications, University Hospitals launched Specialty Pharmacy in 2016.

It has become the first enterprise of UH Ventures, a new arm of the system that aims to develop business models leveraging existing capabilities and develop new revenue for the organization.

And the new effort, formed last year, is hoping to help propel the work of Specialty Pharmacy. “(Specialty Pharmacy) was an existing program, but had not really blossomed to really increase its velocity, and Ventures helps to enable that realization,” said Eric H. Beck, who joined UH Ventures as its president in late January.

Beck — a seasoned health care executive who most recently served at the University of North Texas Health Science Center — will work with UH leaders to accelerate system growth through new businesses and to expand a pipeline of initiatives in line with UH’s strategy.

UH Ventures aims to build upon and encourage the entrepreneurial culture and spirit of University Hospitals, said Dr. Jeff Peters, chief operating officer at UH. Supporting innovation, new revenue and the commercialization of discoveries is nothing new among

health care entities.

“I wouldn’t say we’re on the leading edge, but we’re not on the trailing edge, either,” Peters said. “It’s an emerging Beck concept within large, integrated health care systems.”

Cleveland Clinic Innovations has for years worked to turn medical breakthrough inventions into products and companies. Last year, the Clinic also launched a second arm to support that work: Cleveland Clinic Ventures, which will work in tandem with Innovations to offer a renewed and added focus to the efforts to spin off companies and raise funds.

Beck said that UH Ventures is unique for its multidimensional approach, focused on three key points: to optimize, maximize and potentially capitalize pieces of UH business; to create relationships with industry large and small; and to create a mechanism to develop new technologies and companies within the organization.

Traditional ventures functions in some hospitals can be narrowly defined as an investment fund, may focus exclusively on joint ventures and new co-creation or might center around an innovation strategy, Beck said.

“It’s a little bit more intentional

University Hospitals last year launched UH Ventures, which aims to build and encourage the entrepreneurial spirit at the hospital system to foster innovation and accelerate growth. (Contributed photo)

and a little bit more thoughtful, while at the same time, it’s a bit more open-ended in terms of how we’re positioning it,” he said.

UH has “very successful” experience in drug development through Harrington Discovery Institute and wanted to expand it into other arenas, Peters said.

“Harrington Discovery Institute is

a very robust public-private partnership for pharmaceutical development,” Peters said.

“There are other spaces for health care technology and business development, like software, hardware, services, delivery knowledge, device development. There are many other spaces for health care application of new businesses or new startups.”

The idea of UH Ventures has been on UH’s radar for a few years. Its predecessor came at least two years ago in the form of an innovation unit and a chief innovation officer, Peters said.

UH Ventures effectively absorbs and builds upon that model.

UH has done some of the work of UH Ventures in the past in other areas, but this is the first time the efforts are brought together and focused under one entity.

“How do we increase the velocity of our assets, core competencies in the organization to position the enterprise for the next chapter?” Beck said.

His background includes working as a clinician in an academic health center, building systems of care in the for-profit and non-profit spaces and working within large publicly traded organizations with aims similar to those of UH Ventures.

Beck’s responsibilities at UH Ventures include identifying and evaluating new opportunities through acquisition, joint ventures and other arrangements, while managing a portfolio of assets to maximize growth.

“We think that the creation of this organization strengthens our ability to navigate the waters of the health care industry of the future, number one,” Peters said. “Number two, to serve the needs of the patients and community of Northeast Ohio and beyond. And number three, to help make Cleveland and Northeast Ohio (a) more vibrant ecosystem for health care innovation and discovery.”

CELEBRATING

$106 MILLION OF BOND FINANCING “Shaping the Future of Lake County”

SENIOR LIVING

Lake Mentor Properties, LLC

Lake County YMCA

Tapestry Wickliffe, LLC

Capannoni USA, LLC

$32,812,000

$8,000,000

$49,030,000

$17,000,000

Lease Revenue Development Bonds for construction of the Lake Health Mentor Wellness Campus

Development Revenue Bonds for construction of a new YMCA facility

Lease Revenue Development Bonds for construction of a senior assisted living & memory care facility

Lease Revenue Development Bonds for construction of a manufacturing facility for De Nora Tech, LLC

September 2016

May 2017

October 2017

December 2017

Mark Rantala – Executive Director

Tim Cahill – Director of Public Finance

To discuss financing your project, call Tim Cahill. | 440.357.2290 Ext. 234

Don Hart – Port Advisor

Bruce Gabriel – Bond Counsel

Ray Headen – Port Counsel

www.lcport.org

CRAIN’S CLEVELAND BUSINESS

|

F E B R U A RY 12 - 18 , 2 018

|

PA G E 3

At the Table

What’s the secret of Sokolowski’s staying power?

If keeping a restaurant alive is an ongoing fight, the Sokolowskis are heavyweight champions Their University Inn, founded in 1923, is Cleveland’s oldest family-operated restaurant. More than that, it’s a genuine landmark in an industry where five years in business seems a lifetime and 20 years are cause for a jubilee.

Sokolowski’s University Inn is that rare place where laborers and lawyers sit at side-by-side tables, feasting from a smorgasbord of ethnic classics chosen from an old-school cafeteria line.

Patrons chow down on the kind of home-style fare they probably haven’t had since Babcia or Nonna reigned in the kitchen. There’s an array of Eastern European staples, of course, from paprikas to pierogi. But slowly pass by those glass-fronted steam tables and you’re faced with ever-changing options. You’ll find anything from stuffed cabbages, meatloaf and sumptuous breaded schnitzels, to barbecued ribs or stuffed pork chops — plus two sides, and the salad bar.

Want a fish fry? Come during Lent, and you’ll probably have to choose from four or five kinds (or prime rib, or a steak … ).

How do you keep a place going strong for nearly (gulp) 100 years? I mean, without killing each other?

Bernie Sokolowski, 62, and his sister, Mary Sokolowski Balbier, 59, glance at one another and laugh. Kid brother Michael, 57, is out sick the afternoon we sat down together.

“We split the days up,” Bernie says.

“My sister and I will do Friday night, and our brother Mike will handle Saturdays.”

“But we also grew up here. This is home,” Mary says. “We talk, or see each other, at least 350 days of a year.

We’re a business, but first we’re a

family.”

They’re a family that has run the restaurant at 1201 University Road for three generations.

When their g r a n d p a re n t s, Victoria and MiJoe chael, opened a Crea tavern in a storefront 95 years ago, it was to serve the teeming South Side population of Eastern European laborers.

When the siblings’ parents took over, they stuck their necks out and, during the 1950s, added a restaurant.

It started with a tiny kitchen that now serves as the dishwashing room; eventually they added additional rooms.

“That was our toughest time,” Bernie says of the growth during the early 1970s. “They did a major expansion and moved everything to the addition. After everything was in place and we had food in the cooler, my dad said, ‘We have 20 bucks left.’

“It was a big chance they took,” he adds.

Though each of the siblings trained for other careers, they had worked in the restaurant since childhood and gradually fell into the responsibilities of a family owned business.

“We’re three bosses,” Bernie says.

“We put our heads together and make the decisions that need to be made.”

There’s no hierarchy to the arrangement, they say. Mary says she is in charge of the cooking, “but Bernie almost always makes the stuffed cabbages.”

“If any of us went down sick, we all could cover,” Bernie says. “That happens all the time. There’s no reason we all have to be here at the same time.

We’ve got a terrific staff.”

PRESENTED BY

NOMINATE TODAY! Do you know a Northeast Ohio woman who is a trailblazer at her company or organization and a leader in the community?

CO-PRESENTING SPONSORS

SUPPORTING SPONSOR

DEADLINE: Tuesday, Feb. 20, 2018 GO TO: www.crainscleveland.com/nominations

Sokolowski’s University Inn keeps things simple with a cafeteria-style line to serve its smorgasbord of ethnic favorites. (Contributed photo)

“And the three of us all know all the recipes,” Mary says.

Those recipes — coupled with generous portions, a growing collection of vintage Cleveland memorabilia and a welcoming atmosphere — slowly made the family restaurant a must-visit destination, including for many celebrities.

Word-of-mouth praise grew into acclaim, landing Sokolowski’s in the pages of national publications and on national TV. In 2014, the restaurant received the food world’s biggest honor when the James Beard Foundation conferred its American Classics Award on the unassuming restaurant.

Despite its reputation as a Polish restaurant, there really isn’t a cuisine Sokolowski’s won’t tackle.

“Funny thing, tomorrow I’m making chicken teriyaki,” Mary said. “But nothing too exotic. People seem to want meat-and-potatoes when they come to Sokolowski’s. Or meat and pierogi.”

“We try to stick with what we’re known for, a home-cooked meal,” Bernie adds.

Apparently, that’s the ticket.

Sokolowski’s lunchtime check averages between $14 and $15, which includes an entree with sides, a fountain drink and dessert. Dinners are higher, anywhere from $10 to $20 depending on the main dish. Some specials, such as seasonal clambakes or the occasional surf-and-turf, run higher.

As with any successful small business, the siblings are forever keeping a tight hand on the till.

“It’s the high price of food,” Mary says.

“Maintaining a certain level of quality, consistently, is the biggest challenge,” Bernie adds.

“And just because (the vendors) raise prices doesn’t mean we can,” Mary adds. “The easiest thing you can do is to raise your prices. But people see that.”

So if the price of blueberries dou-

bles, they’re off the menu. Fish prices, among the most volatile of the proteins, are checked with three vendors before Mary places an order. She says she hand-cuts meats for schnitzels and goulash, and the kitchen crew peels and trims vegetables. Most sauces are prepared in-house and from scratch.

“I’ve got to admit, lots of times we don’t watch the food costs that carefully, but in the new year I have been paying closer attention,” Mary says.

“You must be vigilant. I hate to say, but when you’re not watching some will sneak up prices.”

Then there’s maintaining a very old building. Bernie recalls the most dramatic example of the ups and downs.

The siblings had just returned from New York, where they had received the Beard Foundation’s honor.

“We were at the top of the world,” Bernie says. “I mean, we’d walked the red carpet and everything. Then someone ran over to me to tell me the plumbing in the men’s room had busted.

“Yesterday I was standing on the stage at Lincoln Center, and the next day I’m laying on my back in the crapper with a wrench in my hand.”

So when you ask the brother and sister whether, in 2018, someone could open their own version of the University Inn, Bernie pauses for a long moment before responding.

“I want to say yes, but I’d have to say no,” he says. “I’d also have to ask, ‘Are (they) willing to make it a huge part of their lives? Are you willing to make all the sacrifices?’ ” Mary shakes her head, no.

“This place is US. It’s Bernie’s, Mike’s, and my personalities. And our parents, and our grandparents. This kind of restaurant is more than just a business in a building. It really is family.”

PA G E 4

|

CRAIN’S CLEVELAND BUSINESS

F E B R U A RY 12 - 18 , 2 018 |

Providing a private travel experience that exceeds expectations

Scannell plans to build two warehouses in NEO

By STAN BULLARD sbullard@crain.com @CrainRltywriter

FEATURING:

FlySkyQuest.com

» 13 Private Jets » Free In-Flight WI-FI » Jet Card & New Club Programs

216-362-9904 Charter@FlySkyQuest.com

DON’T LET THE WRONG LENDER

FREEZE YOUR DEALS Talk to CBS and your local credit union about your next commercial loan.

• Purchase and Refinance • Commercial Real Estate • Loans up to $10,000,000

Scannell’s most recent Strongsville building is typical of the warehouses that are in demand with industrial users. It envisions that its next space in Twinsburg will look like the rendering below. (Contributed photos)

The new Twinsburg and Strongsville buildings both are expected to be available by this fall.

David Browning, managing director of CBRE Group Inc.’s Cleveland office, said “it’s great news” that more rental warehouse space will go up this year.

“We have an active industrial market, and vacancies are tightening,” Browning said. “We have had a supply constraint in the market for several years because there has not been available space. It will be healthy for the market to have quality new construction. I expect it to lease.”

Coyne said Scannell has several prospects for both new buildings, but he declined to identify them.

“There’s more demand in the market than there is supply,” Coyne said of new, 32-foot-tall buildings with modern sprinkling and lighting systems.

At the end of 2017, Newmark Knight Frank estimated vacancy in Northeast Ohio’s industrial market was 6.5%, down from 6.7% a year ago.

The volume of empty industrial space at the submarket level is even lower in the areas where these buildings are planned, according to Newmark Knight Frank’s report. Vacancy is 4.7% in the southeast industrial market, which includes Twinsburg.

Vacancy in the southwest market, which includes Strongsville, is just 3.7%.

Residential realty brokerage touts cloud-based operation

Contact Jonathan A. Mokri 440.526.8700 jmokri@cbscuso.com www.cbscuso.com

By STAN BULLARD sbullard@crain.com @CrainRltywriter

Your Business Lending Partner SM

Take a Risk. Visit % ArmadaRisk.us/CLOSE www.armadarisk.us

Scannell Properties, the Indianapolis-based real estate developer, plans to build not just one, but two big warehouses this year in Northeast Ohio.

That’s the word from Scannell’s agent for the properties, Terry Coyne, a vice chairman of the Newmark Knight Frank brokerage’s Cleveland office.

Scannell plans to construct on a speculative basis — building before it signs tenants to lease the buildings — a total of a half-million-square feet of warehouse space for a simple reason, Coyne said in a phone interview last Thursday, Feb. 8: “We’re out of space in Twinsburg and have just 23,000 square feet of space left at the first building in Strongsville.”

Both new structures should be complete by this fall.

At Cornerstone, which a joint venture of Scannell and the DiGeronimo family of Cleveland co-developed at 2000 E. Aurora Road in Twinsburg, the new building will consist of 300,000 square feet and will be south of buildings occupied by FedEx and Amazon.

Cornerstone was developed on the site of a former Chrysler stamping plant, which was demolished after the automaker shut it down in 2010.

In Strongsville, Scannell last year installed the foundation for its next 200,000-square-foot building, at 14720 Foltz Parkway, as it built a 220,000-square-foot building next door. That means construction workers will be able to pick up where they left off last year.

X

216-350-5050

The eXp Realty brokerage, which bills itself as a cloud-based residential real estate company, is getting its ground game going in Ohio.

That’s ground game as in adding real estate agents, because the brokerage puts a low priority on having a physical presence. Moreover, its strategy depends on not having the typical agency office throughout the areas its agents cover, because its major feature is eschewing traditional bricks and mortar costs for its agents.

“That means more income for the agent,” said Edward V. Hazners, a Westlake Realtor who is eXP’s Ohio broker, in a Feb. 2 interview.

Yes, he said, he does have a 1,000-square-foot office in Broadview Heights, but it’s not a location for agents to spend much time. That also eliminates that traditional rite of passage for new real estate agents: spending time in the receptionist’s slot fielding calls in hopes of snapping up prospective customers.

“We have access to Regus (shared-office locations) for agents who don’t want to meet clients in their homes,” Hazners said.

The eXp agents are not discount brokers, he added, but the firm approaches its split differently with the agent. The Bellingham, Wash.-based

company takes 20% of the split of the commission, leaving the agent 80% on the first $80,000 in gross commissions.

That disappears after an agent has paid $16,000 in closed commissions annually. Then agents continue to pay a $50 monthly technology fee and the cost of their errors and omissions insurance, generally about $30 a month.

Hazners said he is employed by eXp as its Ohio broker, responsible for helping bring agents, either established professionals or rookies, into the company, getting them set up with its technology. He also handles commission and ethical disputes in his role as the company’s Ohio broker, though he can still handle listings.

The brokerage now has 170 agents throughout the state, compared with 12 last August when Hazners, who has more than 20 years of residential sales experience and previously owned his own real estate company, signed on with eXp. The firm’s website indicates it has more than 20 agents in Northeast Ohio.

The technology includes access to an eXp real estate campus on the web where agents may create their own avatar and go to different locations on the cyber property for services such as help with technology, training or meeting other agents to network.

For those who don’t want the graphic simulation, the firm’s site can be navigated through traditional drop-down menus. The brokerage also provides lead-generation and related software.

“I’m not out selling eXp,” Hazners said. “It’s growing on its own by word-of-mouth among agents.”

The brokerage, which has 6,500 agents in 45 states and two provinces of Canada, is a unit of eXp World Holdings Inc. (OTCQB:EXPI). Its founder and CEO, Glenn Sanford, created the concept in 2009.

Mike Zinnicola, who leads the 60-agent EZ Sales Team based at the Westlake office of Keller Williams, is no fan of the eXp approach. And that comes from an agent whose team has made quickly embracing and deploying technology, from multiple websites to drones, part of its reputation.

“Real estate is not a commodity you can buy on the internet like a pair of shoes,” Zinnicola said in a Feb. 6 interview. “I think the eXp concept is flawed because real estate buyers and sellers need the security of having a local office nearby. What is the first thing you do after you sign up a seller?

He or she gives you a set of keys to their home. Are they secure doing that with someone who does not have an office they’ve met in the field?”

For Hazners’ part, he argues the professionalism of the agent is what creates a buyer or seller’s comfort in working with an online operation or any brokerage. Although he touts the online aspects of the operation, he notes one thing will not change due to technology in real estate.

“You will always need the agent, the brokerage,” Hazners said.

CRAIN’S CLEVELAND BUSINESS

|

F E B R U A RY 12 - 18 , 2 018

|

PA G E 5

Cleveland firm will occupy former church

By JAY MILLER jmiller@crain.com @millerjh

An 85-year-old Tremont church that's now vacant will be the new home of Olympic Forest Products Co., a growing pallet maker and pallet management service firm, adding several dozen office workers to the largely residential/retail mix of the West Side Cleveland neighborhood.

The company has outgrown its existing space at 2200 Carnegie Ave. In 2008, president and owner Dan Andrews bought the two-story, 6,100-square-foot building from the American Federation of Musicians Union Local 4. At the time, the company had 18 employees. Now, Andrews said, the company employs 27.

The church, at 2280 West 11th St. and originally St. Vladimir Ukrainian Orthodox Church, is being built out with the expectation that Olympic's employment will grow to 45. Olympic is doublig its physical space in the move, to about 12,000 square feet at the church.

The financing of the $2.3 million purchase and renovation cost is being assisted by state and federal historic tax credits and a $180,000 city of Cleveland loan. The state tax credit is for $249,000, while the federal tax credit will contribute $200,000 to the financing package.

“We’re very, very happy because not only does it diversify what is happening in the neighborhood, by bringing daily office users, it saves the church building,” said Cory Reardon, executive director of the Tremont West Development Corp., the neighborhood’s nonprofit community development corporation.

Other interested users saw the property as a residential site, but Reardon said that would have meant tearing down the church for a dense development.

“Not that we don’t encourage density, but (the church) is in the middle of a neighborhood street with two-family homes,” he said.

Andrews said the decision to move was triggered by the business’ growth and because, eventually, the Ohio Department of Transportation (ODOT) will take the Carnegie Avenue property for the planned rebuilding of the nearby Innerbelt. That reconstruction is several years away, but Andrews and ODOT have been negotiating an early purchase of the building.

“We weren’t planning on moving, but after (ODOT) came to us, it just seemed like this was the chance to make a move,” Andrews said. “We looked all over Cleveland, but one of the problems that we found was that where there were some opportunities, there was no parking. And Tremont would be cool for employees. It feels cityish, but kind of more fun.”

The property includes the church building, an attached two-story rectory, a two-car garage and a parking lot, according to the application for state historic tax credits. The church will be rehabilitated for open office space, conference and meeting rooms, with a spiral staircase connecting the basement to the main floor.

“We like open space. We like collaboration, people working together,” Andrews said.

The rectory will house private offices, and the choir loft will be used for what Andrews described as “re-

laxation space.” The historic elements, notably the church windows, will be retained. The garage will be torn down and may be replaced.

The building’s last occupant, the Spanish Assembly of God Church, watched as its congregants moved out of the area. The congregation last June sold the church to an affiliate of Olympic for $650,000.

The building generated little interest for residential redevelopment, said Matt Moss, housing and economic development director of Tremont West, because of the building’s layout and its failure to meet the requirements under the Americans with Disabilities Act. Residential developers saw it as a teardown. Olympic saw it differently.

“To take a building like that and re-

store it fits in well with our mission,” said Mary Heideloff, Olympic’s vice president of marketing. “We’re a national (wood) pallet company and what with the resource we use, sustainability and environmental concerns are important to us.”

Olympic manufactures and sells wooden shipping pallets to customers like E.I. du Pont de Nemours and Co., PPG Industries Inc. and Sherwin-Williams Co. It also can manage the pallet stock of its clients and recycles them.

Olympic had sales last year of $104 million, not including a pallet manufacturing plant Andrews owns in Kidron.

Although Tremont is a largely residential neighborhood with restaurants and retailers on major streets, it

is developing a few office tenants, Moss said. Developer Sustainable Community Associates has carved out office space in its Fairmount Creamery and Wagner Awning residential projects in Tremont and MCM Co. has transformed the former Our Lady of Mercy Church property overlooking Lincoln Park into a multi-tenant office complex.

It made sense to Andrews, who found traditional office space uninspiring. At its current home in the musicians’ union building, for example, most of the offices and the conference room are what had been musician rehearsal space.

“A downtown office building would have made parking expensive for one thing,” he said, “I wanted a little more cool.”

Olympic Forest Products Co. is moving into the vacant former St. Vladimir Ukrainian Orthodox Church on West 11th Street.

(Jay Miller)

PA G E 6

|

CRAIN’S CLEVELAND BUSINESS

F E B R U A RY 12 - 18 , 2 018 |

For Sale - 197+ Acres of Industrial Land Riverbend Commerce Park Port of Lorain

Norfolk & Western Rail ri A ve.

N

Color a

do Av enue

By STAN BULLARD

sou

Harbor Walk Condominiums

M is

Downtown Lorain

sbullard@crain.com @CrainRltywriter

197+ Acres

611

Republic Steel

Black River * lines are approximate

Colorado Avenue, Lorain, Ohio • Beautifully wooded site on the East side of the Black River • Sewers, utilities & access roads are all installed • Zoned: I-3 light industrial (with some areas B-2 frontage on Colorado Ave.) • Publicly held to provide fast track permitting

Firm that handles distressed loans takes on Euclid complex

• Ideal for a variety of uses • Phase I & II complete/available • Access to rail & dockage • Access to copper, fiber & natural gas • Financial incentives through TIF, State & Port Authority • Minutes from I-90 & I-80 (OH Turnpike)

Mark S. Abood

216.839.2027 MarkAbood@HannaCRE.com HannaCRE.com

The owner of the 950-suite North Pointe Apartments in Euclid has tossed in the towel and had its request granted that the lender assign its $38 million loan to a firm specializing in handling distressed loans.

The loan behind the troubled four-building complex of apartment towers, two as tall as 20 stories, on Feb. 5 was assigned to the Miami office of Rialto Capital Management, according to Cuyahoga County land records. Rialto is a special servicer, which handles foreclosure and other methods of fixing distressed loans, as well as an acquirer of troubled properties.

The twist in this story is that the building's owner, North Pointe Towers Ltd. of Pepper Pike, requested in writing to its lender that the mortgage be assigned to special servicing.

PE

CONTINUED FROM PAGE 1

President’s Visit Day 9am – 11:30am

Working in an evolving landscape is being seen prominently in Northeast Ohio funds, where the scope of the private equity and venture capital scene may surprise those unfamiliar with it.

According to Crain’s surveys, there are more than 40 investment funds of that ilk active in the market today — and that doesn’t include every investment made here as some firms, like family offices, don’t publicize their deals, while others made by non-locally based firms may be unaccounted for. Those firms, per Crain’s research, made 186 deals or investments in 2016, with 45 of those (24%) targeting companies in Northeast Ohio.

Uncertainty lingers

Online Session starts March 5th 30+ values-based on campus academic programs including education, nursing, criminal justice, business and more Undergraduate & Graduate Online learning opportunities in a flexible environment Leadership and scholarship opportunities in academics, NCAA Division II athletics, clubs, campus ministry and performing arts Student support programs, including the nationally recognized Academic Support Center for Students with Learning Differences Exciting new policies & financial aid opportunities for transfer students

Don’t wait – Call 877.NDC.OHIO or log on to NotreDameCollege.edu!

Believe in the Greater You 4545 College Road • South Euclid, Ohio 44121 877.NDC.OHIO • NotreDameCollege.edu

At a base level, less tax should translate to more profits. That would naturally be beneficial for funds’ platform companies.

“The portfolio companies will be taxed at a lower rate, which means more money to invest in the business and generate growth, unlike private business owners who might take that money out,” said Douglas Neary, vice chairman of Calfee, Halter & Griswold LLP and a senior partner in the firm’s M&A and corporate practice. “They are going to leave it in assuming the business is healthy and let it grow on its own. At the portfolio company level, that will help with future acquisitions and the existing portfolio.”

Accelerated profitability could put some companies in position to be sold sooner than an expected hold period.

There was a lot of chatter about whether carried interest would be affected in the tax bill, Neary said, but that was mostly left intact. Carried interest is how general partners make their money and usually amounts to 20% to 25% of a fund’s annual profit. The new tax codes require the holding of an investment for at least three years to receive preferential capital gains treatment.

The hold period for a private equity firm generally is considered to be between three-to-five years or five-toseven years. So the issue of selling a company inside that three-year window would only pop up with an exceptionally strong investment. After all, the high valuations firms are facing on the buy side are increasingly to

That's according to a report from Trepp LLC, a New York City-based real estate consultancy which reports on the status of commercial real estate loans. Trepp gets its data from people assigned to report details on the loans.

Woes at North Pointe Apartments have included a sidewalk protest of conditions at the property by tenants last summer that was covered by WEWS-TV, Channel 5. Trepp reports show tenants also are voting with their feet, as its occupancy fell to 67% last September from 86% at the end of 2016. The loan was 60 days delinquent at the end of 2017, Trepp reported.

The property has also been well known by its prior name when the property opened in 1970 as The Watergate and prior ownership by the former Associated Realty Corp. of Richmond Heights and K&D Group of Willoughby. It has been owned since 2013 by an affiliate of APM Management, a Pepper Pike-based

real estate ownership and management firm headed by Paul Kiebler, according to state records and its website. K&D sold the complex that year to another APM affiliate, Suffolk Family trust, for $57 million, according to Crain’s coverage at the time.

Throughout the years, the ownership has remained under the legal name North Pointe Towers Ltd. The property gained a dubious marquee presence in the national commercial real estate world when Trepp reported it was the largest distressed loan in the U.S. in January, as loan payments had not been made for 60 days. The notice was part of a report on the state of the U.S. multifamily property business undertaken because of long-running growth in the nation’s apartment market. While focus was on glitzy and elegant new apartment properties, the distress poster child came from the dated precast concrete towers astride Lake Erie.

their benefit on the sell side, too. According to research firm PitchBook, the median valuation multiple in U.S. M&A deals reached 10.3x in 2017.

Still, hold periods could shorten if profitability picks up. And that’s something firms are striving for in today’s competitive deal climate that’s pushing some funds to look at lower ends of the market for value and contributing to a buildup of dry powder firms need to deploy regardless of economic conditions and soaring valuations.

Those capital gains implications reflect one of the many areas of uncertainty for investment funds.

“There is some ambiguity as currently written, and that will hopefully be addressed soon,” said Steven Rosen, co-founder of Beachwood’s Resilience Capital Partners. “For example, does the three-year holding period apply to both sale of the partnership interest and also to passed-through capital gains? Does the three-year holding period rule apply to a member of the general partner’s own limited partnership in the same entity?”

At this point, the answers to those questions remain unclear.

the financing structure in a deal and how a firm itself would be post-investment. It’s another factor firms are evaluating.

For instance, most firms want to finance a deal with debt, which they can pay off at a lower cost of capital and generate a higher return on equity. Because of limits on interest deductibility from the tax codes, though, funds may end up having to put more equity in a deal. That could impact rates of return. (Firms can’t publicly discuss expectations for returns because of regulations, so none interviewed in this story could comment on whether they see their outlook for returns affected in this environment.)

All this means eyes will be keenly focused on how a deal is financed.

“The structuring considerations do seem to be the most complex, and we are working with our consultants to understand all the implications,” Guddy said.

“This should make discussion with our bankers very interesting as credit agreements are drafted,” Rosen added.

Meanwhile, in this market, in which manufacturing is still a large part of the economy, the lower tax rates might help draw investment dollars by private equity funds.

“Maybe now there’s a little more appeal to a manufacturer sitting in Northeast Ohio that makes a lot of domestic products and sells them domestically,” Glazier said.

Those elements could also appeal when it comes to securing financing for an acquisition. Firms with global capabilities often saw value in foreign companies where tax rates are lower, or domestic companies with foreign operations.

“Someone who is domestic who doesn’t do foreign might’ve not been super attractive before,” Glazier said.

“Overnight, they’ve become a little more attractive.”

So while overall investment strategies haven’t drastically altered, the new tax landscape may influence some firms to model different investments in different industries and “take a second look at something they might’ve looked at last year that might not have made sense at the time,” Glazier said.

“I think the smart firms with a sharper pencil will get a bit of competitive advantage out of this by recognizing some of these aspects and factoring them into how they bid for companies,” Neary said.

Competitive advantage Despite uncertainties, new tax codes won’t have much effect on overall investment strategies. A more tumultuous and uncertain environment may reinforce staying true to business models.

“The tax bill itself doesn’t require any rework of our strategy, taxes don’t drive our investment decisions but are one of many factors we evaluate when making investments,” said James Guddy, managing director and cofounder of Watervale Equity Partners, which formed last summer. “However, we do believe that the tax bill is good for small business owners. If it’s good for small business owners, then we generally think it is good for us.”

The tax rules could persuade some firms to consider deals they might’ve passed on before, though.

Part of that could be a function of the competition for deals fueled by a bull market and piles of capital that need put to work. According to a January report by research firm Preqin, global dry powder levels currently exceed $1 trillion. Those levels follow a record 2017 for fundraising that saw $453 billion raised.

But the tax bill still could influence

CRAIN’S CLEVELAND BUSINESS

|

F E B R U A RY 12 - 18 , 2 018

ESPORTS

Gaming ‘pathway’ Akron’s varsity program will include 30 to 35 students who can qualify for scholarships that start at $1,000 and have the potential to increase, depending on the skills of the player.

Student coaches will be offered a $5,000 scholarship, and the Zips will have a club program that could comprise several hundred members.

The groups will compete in an esports arena that’s being built in the honors college, plus one that is under construction on the first floor of Bounce, an innovation hub the city is creating in the current Akron Global Business Accelerator building on South Main Street.

Wilson knew the Zips had made the right move when 50 honors students showed up at 4 p.m. on a Friday afternoon to talk about the program.

“I talked about my vision and what I thought it could do,” Wilson said. “That told me right there, right then, there was a significant interest in seeing what could happen. One student stuck around until almost everyone was gone and said, ‘Today, you validated my existence in life. All I heard growing up was video games are no good.’ ” The university president said parents of gamers are similarly encouraged, since they now might realize there is a “pathway” to a career in esports.

On Dec. 18, when Akron announced its esports program, the university posted a survey that asks current and prospective students if they’d like to support the team, and which roles and games they prefer. As of Feb. 6, almost 1,300 people had submitted their information, the university said.

“Part of what makes me think it can work is this is a group that’s already been doing it,” Cravens said of playing video games. “It’s massive in terms of the numbers.”

And it’s a group that the vice provost said goes against some of the gaming stereotypes. This isn’t a bunch of slackers who skip class and don’t care about school.

PA G E 7

Esports’ Ohio ties The Next Level’s May 2017 report on college esports estimated that there were 38 scholarship programs in the U.S., and that the number was expected to grow to 60 by the end of the year.

CONTINUED FROM PAGE 1

In the last five years, at least 50 schools have started to offer scholarships for varsity esports teams, which, much like their athletic counterparts, train, wear uniforms and are taught proper nutritional habits. Only they’re doing so to compete in such popular video games as League of Legends, Rocket League and Hearthstone.

This fall, Akron will become the first public university in northern Ohio to field a varsity program, and the Zips likely will be joined by several others in the near future. According to a 2017 second-quarter analysis by The Next Level, Ohio had three universities — Lourdes, Ohio State and Tiffin — that offered esports scholarships, and another, Miami University, was the first NCAA Division I school with a varsity esports team. This fall, the RedHawks will begin offering esports scholarships for the first time.

Factor in Akron and Ashland, which are launching esports programs in 2018-19, and the Buckeye State’s tally is, at the very least, approaching double figures.

The Zips’ top rival, Kent State, “is absolutely going to have some presence in esports,” Nathan Ritchey, the vice president for Kent State System Integration, told Crain’s.

The Golden Flashes hope to have the majority of their plans in place by the fall, said Ritchey, who called it a “one-university approach” that will include Kent’s main campus and seven regional campuses, and could feature available scholarships.

|

Three Ohio universities were listed — Lourdes, Ohio State and Tiffin. In the fall of 2018, the University of Akron, Ashland University and Miami University will begin to offer esports scholarships. Miami was the first NCAA Division I school to launch a varsity esports program.

The Next Level’s report estimated that 655 students were receiving a combined $4.1 million in esports scholarships last year. — Kevin Kleps

Akron’s varsity esports program will include 30 to 35 students who can qualify for scholarships that start at $1,000 and have the potential to increase, depending on the skills of the player. (Contributed photo)

“Not only would we be attracting students, we would attract high-achieving students,” Cravens said. “We could build bridges with our existing programs and develop new programs.”

Building a foundation Wilson — who received Pong, one of the earliest video games, as a handme-down after Atari was released — said one of his alma maters lent a helping hand when Akron was studying whether it could make esports work.

Wilson made a couple trips to the University of Utah, which has a well-regarded video game development program, last year.

“A big part of the discussion we had was what should be looking for in a coach? When we put a callout for a coach, that’s quite attractive,” Wilson said. “It came down to do you go out and get the best gamer you can find, and hopefully they can show and teach students how to win championships? Or do you go with someone who will be more of a leader and get people to respond?”

The Zips went the latter route with the hiring of Michael Fay Jr. as their first esports director and head coach.

Fay has a bachelor’s degree in psychology, a master’s in emergent media and is a former production director for esports competitions.

The 26-year-old said he envisions his position as a “hybrid of two roles.”

As the coach, he’ll be identifying strengths and weaknesses, and mentoring gamers.

“I’m looking to be competitive in every way I can,” Fay said. “But I think a huge part of that is the foundation side of that.”

And that’s the segment about which his boss seems most excited.

“If we became known as a gamer haven and churn out champs similar to our track and field program, you won’t hear any complaints from me,” Wilson said. “But at the same time, it’s a very competitive industry. We prepare our students for the future.

This is part of that.”

Bounce can provide lift Akron’s esports push could wind up extending well beyond its campus.

Anoo Vyas, co-director of the Zips’ Experiential Learning Center for Entrepreneurship and Civic Engagement, said Akron’s esports arena should open in the next 10 or 11 months at Bounce.

The space will be decked out in blue and gold, with Zippy murals on the wall, top-notch gaming equipment

and a multipurpose conference room that could serve as a viewing area.

“We started offering it to students at the university, but staff actually started reaching out,” Vyas said. “ ‘Is there a way we can be involved? Can there be teams for staff?’ That shows you the groundswell of support.”

Akron’s Bounce partnership is ex-

pected to also include a cybersecurity “range,” which Wilson described as “a dedicated area to teach students how to hack ethically and how to defend” against cyber attacks.

“We talk about us being the innovation city and our long legacy of innovation,” Vyas said. “Well, this is taking innovation to a new discipline.

It’s not just esports. We want students in the facility.”

And esports’ drawing power — with Twitch and YouTube reportedly combining for 2.1 billion hours of content that was consumed in a sixmonth span last year — is considerable, to put it mildly.

The demographic, on average, is young and very active on social media — making it all the more appealing to universities.

“I do think it will have a substantial impact,” Wilson said. “We had some grads reach out and say, ‘Hey, is it too late to come back and get another graduate degree?’ ”

TAX REFORM What the law is really telling us FREE WEBINAR February 20 • Noon - 1 PM The new tax reform law is sparking a lot of questions and concerns regarding the effects on businesses as well as individuals. In 1-hour, we will discuss the key items you need know to plan for the changes and address the essential questions needed for a successful 2018.

Featured Speakers

FLOYD A. TROUTEN III, CPA Tax Director, Estate Planning and Transaction Advisory Services

LARRY D. FRIEDMAN, CPA, MT Director & Chair, Compliance and Tax Planning Services Department

Hosted by:

Presented by:

REGISTER NOW: CRAINSCLEVELAND.COM/WEBINARS

PA G E 8

|

F E B R U A RY 12 - 18 , 2 018 |

CRAIN’S CLEVELAND BUSINESS

Opinion From the Education Beat

Changing times put onus on us to always adapt

Editorial

Shining bright The warm glow of the Republican National Convention continues to burn brightly for Cleveland. The latest plaudit came from the federal government, which praised Cleveland for how it handled a Department of Justice grant that provided up to $49.9 million for security for the 2016 nominating convention.

According to a report from Cleveland.com, an audit from the feds found that Cleveland complied with goals and objectives funded by the grant, submitted proper reports and spent the money properly. In fact, the city spent $8.3 million less than was expected. One hiccup — neglecting to properly mark vehicles purchased with the grant money — was quickly corrected.

When you couple that sound fiscal management with the actual performance of the city — namely its police force — during the convention, you’ve got a city that has demonstrated it can compete on the national stage for blockbuster events.

Not bad for government work.

Many of the items purchased for the convention — specialty vehicles, bikes, riot gear, etc. — are still in circulation today. The bikes, in particular, should continue to serve as an important tool in improving the relationship between police and Cleveland’s citizenry. After all, every little bit helps, especially given the current fiscal climate for Ohio municipalities whose finances have been ravaged by a state government seemingly more interested in balancing its own books than that of its cities.

Nearly two years after Donald Trump’s formal coronation as the Republican nominee, the city’s masterful handling of the convention continues to work itself into talking points from our civic leaders.

Tiring? Sure, but they’ve earned the bragging rights.

Road map

Is gerrymandering on its way out in Ohio? It’s possible, in the wake of votes last week by the state Senate and House that could, for the first time, lead to a requirement for bipartisan in-

put and approval for federal congressional maps.

In a fairly stunning act of cooperation on the most partisan of issues, the state Senate voted 31-0 last Monday, Feb. 5, and the House voted 82-10 the following day to place on the May ballot a constitutional amendment that could reduce the practice of manipulating congressional district boundaries — often to absurd lengths — for political gain.

That kind of bipartisan support almost never occurs these days on anything of importance, so the votes were telling indications that gerrymandering has emerged as a real threat to confidence in the democratic process in Ohio. Some of the credit here goes to a coalition called Fair District = Fair Elections, which was pushing its own proposal and put pressure on Democrats and Republicans to come up with a solution. Uncertainty about which party will control the governor’s office in 2021, when districts are redrawn, also played a role.

Daniel Tokaji, a professor of constitutional law at Ohio State University, told The Columbus Dispatch, “I can’t think of anywhere where we’ve had a situation like we’ve had here for the past couple of years. People in Ohio’s state legislature recognize there’s a serious problem.”

At present in Ohio, as in most states, the state Legislature has almost complete power to draw congressional districts, which means the party in power — the Republican Party here — has a huge advantage (and incentive) to make a map favorable to its electoral prospects.

The proposal facing voters in May would require three-fifths support of the Legislature to pass a map for use over 10 years, and that three-fifths must include 50% of members of the minority party. It also would establish a maximum number of counties that can be split by congressional districts.

It's not a perfect solution, in large part because it still involves politicians — and not, say, a separate bipartisan or nonpartisan group — slicing up the way voters are represented. But it's an important first step to reducing the advantages of incumbency and introducing more balance to the drawing of Ohio's political map.

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

CLEVELAND BUSINESS

CLEVELAND BUSINESS

Managing Editor:

Scott Suttell (ssuttell@crain.com)

Sections Editor:

Timothy Magaw (tmagaw@crain.com)

Contact Crain’s:

216-522-1383

As I was reporting on the challenges facing liberal arts colleges for this week’s higher education section, the idea that the industry was in a time of transition came up again and again.

Decades of rising costs have reached a critical mass for many families at the same time as the promise of a guaranteed post-graduation job fades. The value proposition of the liberal arts has been questioned loudly. The schools that want to last have to change with the times. And, to be fair, many are working hard to do so.

But that idea of an industry in flux was a familiar drumbeat to me. And for good reason.

I’ve been covering manufacturing, another industry in a state of change, for almost five years here at Crain’s. I quickly learned how many of my own perceptions of the industry were outdated. I grew up in Rachel Abbey Trumbull County, in the shadows of McCafferty Youngstown’s fallen steel industry. Companies were eager to tell me about how their plants weren’t, as many said, the “dark, dirty and dangerous” factories of years before.

While manufacturing employs far fewer people today, it’s vibrant and innovative. Production is high. I’ve seen fascinating technology at work, from 3D printers to industrial robots. Manufacturers, for the most part, know their industry has changed and has continued to change, but public perception has lagged behind.

It’s such a privilege to get to cover an industry during a time of change. And it comes with such responsibility.

As reporters, this is something we need to keep in mind as we cover our beats. We’re not only documenting history with our words, but we’re also — purposefully or not — shaping how the public views industries, movements, people.

I love being a reporter. I get to meet new people and see new things all the time. I have license to ask people all sorts of questions, from how a machine works to what their greatest passion is. I get paid to be curious and social and, you know, to write, which is what I’ve wanted to do since I first learned what writing was.

But there’s a real weight to this job, too, and it’s in how we can responsibly and fairly write about our beats, and the people, companies and institutions that compose them. And this is never more important than when that beat is drastically changing.

I think that’s more true today, post-recession, than it has been in a long time. Health care has been adapting to the changing insurance marketplace and the technological advances coming ever faster in medicine itself. Politics has changed almost immeasurably in recent years, and the old rules no longer seem to apply. Workplaces and society at large are finally, finally grappling with the sexist treatment many women experience daily.

And media are far from exempt.

As we try to find new ways to fund our work and push back against clickbait and fake news, we have our own perception problem to deal with. One way to address it is through our coverage, by being as thorough and as precise as possible while reporting on these changing times. It can be hard, particularly in the 24-hour news cycle (which feels like a generous estimate in the Twitter age), but it’s some of the most important work we do. We owe it to our readers who expect us to be their eyes and ears in unfamiliar places.

And we owe it to the sources who trust us with their stories.

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

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

Please include a telephone number for verification purposes.

CRAIN’S CLEVELAND BUSINESS

Personal View

When collaboration beats competition in health care

By J.B. SILVERS

Many observers think that what health care needs most is a big shot of competition pitting the players against each other. Others bank on price transparency and comparison shopping by individual patients spending their own money — although anyone covered by Medicare Advantage or a plan offered on the Obamacare exchanges understands the difficulty of picking among confusing options with varying premiums.

The real issue in health care Although marginally helpful, none of these deal with the underlying issues in health care. The big question is how physicians choose what care to recommend and provide and what results from their choices in terms of costs and outcomes. Since, by definition, the doctors know more about medical care than we do as consumers, it is difficult to believe that we can outguess them by selecting care alternatives in a competitive marketplace. We want them to know more and we are willing to pay them for this knowledge. So the real question is how can we change the way physicians practice to advance toward the triple aim of improved quality, better outcomes and reduced per capita cost?

It’s not as if physicians don’t value these goals. The natural bent of physicians starting with their medical school training is toward collaboration and peer review. Difficult cases call for a consult, and residents rely on oversight from faculty.

But this natural desire to gather all sources of knowledge that might be helpful for each patient is more difficult when salaried physicians work for competing organizations and practices. Referral out of a health system may be discouraged or even prohibited if the patient is insured within a narrow network. But beyond contractual issues, it may be hard for physicians to talk to other physicians across dispersed practice settings as primary care, and even specialty practices, are devolved into neighborhoods rather than located together in a medical center.

Something that actually works In Northeast Ohio, we have a major success story in overcoming these barriers in Better Health Partnership (BHP), a nonprofit established in 2007 with initial funding from the Robert Wood Johnson Foundation.

This successful initiative focuses on a defined population (Cuyahoga and Summit counties), universal commitment of the provider group (over 75% of all primary care physicians and their patients), and an “integrator” (BHP) taking responsibility for improved outcomes.

Better Health starts with electronic medical records (EMRs) provided by each member organization. This

What does this suggest?

While competition among concentrated health systems is here to stay and may even help organize and finance improvements, front-line primary care practices are the key to reducing costs and improving health outcomes. Prevention of unnecessary care, the promotion of health status, and lower overall cost and appropriate utilization and coordination of sophisticated services all start here. And the key to realizing the potential of primary care is sharing best practices and learning from each other. It sounds so simple, but it may not come naturally in a competitive health system unless we consciously work to create a safe place for this necessary collaboration.

Silvers is a professor of health finance at the Weatherhead School of Management at Case Western Reserve University and a board member of the Better Health Partnership.

Golf has declined in popularity in Northeast Ohio, but it still has appeal for the number of business visitors who stay in hotels at Rockside. It's a smart move for Independence — and a loss to Valley View, which had a large, all-weather golf facility at one time down on the Cuyahoga River. — Laura McShane

Re: Warner & Swasey Co. site Without the active participation of MidTown Cleveland, this site would continue to sit unused.

Congratulations to director Jeff Epstein ... for seeking proposals to redevelop a 230,000-squarefoot building on the site, or to raze it for something new. ... Finding a developer and tenants won't be easy, but it's worth one more try. — Bob Brown

F E B R U A RY 12 - 18 , 2 018

|

PA G E 9

Our Private Bankers are experienced, providing customized lending solutions to ensure your continued financial success.

• Offering a superior level

of service, we conduct business at your convenience.

• Entirely committed to

providing core bank products and services, we do not offer wealth management or financial planning services.

LET’S TALK.

Jim Hojnacki VP and Division Manager jhojnacki233@dollarbank.com

How well does it work?

Web Talk Re: Topgolf's planned Independence facility

SEE WHAT PRIVATE BANKING SHOULD BE.

lets the staff know what actually happens to the patients in each practice. Building on these, twice yearly public reports provide performance comparisons across all groups, including non-medical factors such as race, insurance type and estimated household income. Then BHP identifies the best practices and organizes follow-on learning collaborative summits where the top performers share how they did it. This “positive deviance” approach avoids blame and encourages all partners to reach for the best. Expert consultation and practice coaching on workflow redesign, care coordination, communication, effective use of EMR data and recognition as a medical home further aid practices in their improvement.

The first target of BHP in 2007 was diabetes care, a chronic condition that has clear makers and bad outcomes if not treated properly. The results there were outstanding with significant improvement in adherence to protocols and measurable outcomes. Other conditions targeted were congestive heart failure and hypertension. Besides clear improvement in each, the large differences in treatments and outcomes across insurers, races, language and income were dramatically narrowed.

The care improvements generated by BHP also have led to substantial reductions in medical costs for our population. Research just published in the peer-reviewed health care journal Health Affairs documents hospitalization rates for the targeted conditions are 22% lower in Cuyahoga than in other large Ohio counties after BHP was implemented. In the first six years of this effort, residents experienced almost 6000 fewer hospitalizations for these conditions than would have been predicted in the absence of the program, with estimated cost savings of nearly $40 million.

|

216.736.8902 NMLS# 1238318 Equal Housing Lender. Member FDIC. Copyright © 2018, Dollar Bank, Federal Savings Bank

PRB043_18

PA G E 10

|

F E B R U A RY 12 - 18 , 2 018 |

CRAIN’S CLEVELAND BUSINESS

Focus HIGHER EDUCATION

Lakeland Community College in Kirtland has added an 88,000-square-foot space that will house its burgeoning Hive program. (Photos by Peggy Turbett for Crain’s)

Abuzz with anticipation Lakeland Community College’s $45 million expansion features a Hive that isn’t your typical learning space

By RACHEL ABBEY McCAFFERTY rmccafferty@crain.com @ramccafferty

There’s some buzz around Lakeland Community College’s $45 million expansion.

The 88,000-square-foot facility — made possible by a 0.4-mill levy approved by voters in 2015 — is starting to come online and serves as a bit of a catch-all space for the Kirtland-based institution, which enrolls about 7,600 students. It will expand the college’s health programs, as well as offer interdisciplinary programs designed to help students get in touch with nature, think creatively and more.

The ground floor of the new building will house the college’s burgeoning Hive program — named for the buzz the college hopes to generate — which is a creative hub for students and the community.

Hive will feature an open amphitheater and tables with built-in whiteboards for brainstorming, plus one room focused on high-tech equipment like 3D printers and another filled with more old-school machinery for woodand metal-working. There will also be a tool library where students or members of the community can borrow equipment ranging from screwdrivers to sewing machines.

While Hive will feature equipment much like the makerspaces and fab labs that have popped up around the region, it’s less focused on technology and more focused on problem-solving and thinking creatively. Leah Konopka Hartmann, assistant to Lakeland’s president and board of trustees, will be overseeing Hive. The program is rooted in what she called design thinking, which is a way to bring ideas to life. For example, the college has been offering life design classes, aimed at helping students examine their strengths and explore different things they may want to try.

Lakeland wants to give students — especially those who may be low-income or first-generation — the emotional tools they need to succeed through programming at the college.

SEE LAKELAND, PAGE 12

Lakeland Community College president Morris W. Beverage Jr. opens windows that lead to a rooftop garden. The area is part of a third-floor greenhouse that will be used as a classroom and a place for students to study. Below, the Hive is a multipurpose area that will offer such activities as event and film gatherings, and a woodworking shop.

CRAIN’S CLEVELAND BUSINESS

|

F E B R U A RY 12 - 18 , 2 018

|

PA G E 11

HIGHER EDUCATION

Oberlin adjusts to ‘challenging times’

By RACHEL ABBEY McCAFFERTY

challenge liberal arts colleges have faced in recent years, in particular, is in the cost of the education they offer.

Financial pressures students face are a real concern, Jones said. To address that, Ohio Wesleyan has been fundraising to support student scholarships and helping students reduce the time it takes them to earn a degree. For example, Ohio Wesleyan has begun offering more online courses for its students in the summer, so students don’t have to be on campus to take classes.

Overall, the models of how higher education is funded have changed.

Schools used to be able to rely on tuition increases if they came into a shortfall. That’s not the case anymore, as Oberlin wants to maintain student costs, Ambar said. And endowment returns aren’t as reliable as they once were.

“So since the levers that we normally would pull are not as predictable, then we need to plan in more strategic and more thoughtful ways,” Ambar said. “And that’s the work that we’re doing as we think about what needs to be the future of higher education in general.”

rmccafferty@crain.com @ramccafferty

Shrinking enrollment. A budget deficit. Certain dining hall foods being viewed as cultural appropriation.

In many cases, these issues at Oberlin College in Lorain County, while not unique to the institution, have made national headlines and helped color the narrative around liberal arts institutions and where they fit in today’s society. That reputation can be seen as a challenge but also as a benefit, said Carmen Twillie Ambar, who joined Oberlin as president in September after serving in the top role at Cedar Crest College in Pennsylvania. Because it gets put under a microscope, Ambar said Oberlin — which she described as a “bellwether institution” — has the opportunity to lead in this challenging space.

“So goes Oberlin, so goes higher education,” Ambar said.

This year, Oberlin missed its admissions targets by about 3%, Ambar said, but the college is well positioned to bear that because of its sizable endowment. As of June 30, for example, Oberlin’s total endowed funds hovered at $820.3 million, up from $753.5 million a year prior, according to the college’s most recent financial report. Still, it’s important to pay attention to deficits and what they mean for the future, Ambar said, particularly at a time when the college is looking to add new initiatives.

“It’s not as predictable anymore, the admissions funnel,” Ambar said.

“It used to be completely predictable.”

Higher education is facing a diminished enrollment pool, as the number of high school graduates flattens or shrinks. Rising costs, for students and for colleges, have also been a concern. Private liberal arts colleges, which tend to have far higher tuition rates than public universities, have borne much of that scrutiny.

These are “challenging times,” particularly for the upper Midwest, said Rock Jones, president of Ohio Wesleyan University in Delaware, Ohio. In addition to the enrollment and financial challenges, the political climate has leaned toward questioning the value of a liberal arts education, which tends to stress a broad-based education, as opposed to teaching focused skills for a particular field.

And that landscape is dominating conversation in liberal arts circles, Ambar said. In addition to the shrinking high school population, small colleges are facing competition from sources they hadn’t come to expect, such as honors colleges at public institutions.

Liberal arts colleges need to realize they’re at an inflection point, Ambar said, and she thinks Oberlin does. But colleges can’t treat this like a “blip on the screen,” she said. If colleges are forward-thinking, they need to prepare for that changing population.

Ambar said part of her work this first year will be to get out into the campus community and make sure that everyone, including faculty, understand the challenges at hand. One challenge will be making sure prospective students and families un-

Oberlin College missed its enrollment targets by about 3% this year, but the school’s endowment grew. Said new president Carmen Twillie Ambar: “So goes Oberlin, so goes higher education.” (Contributed photos)

derstand how classes and other experiences at Oberlin will directly connect to their lives after graduation.

For example, Oberlin has what it calls a “winter term” in which students can apply their learning to real life, taking part in experiences such as capstone projects or undergraduate research. But Ambar isn’t sure the college always talks about that opportunity — and the benefits it holds to students — as clearly as it could.

Ambar also said Oberlin will be looking at what kind of academic programs it can add to build on its existing strengths in the arts, sciences and music. Ambar said Oberlin hopes to begin a more rigorous academic review next year. That work will be important for the college to ensure that it’s investing its resources most wisely, as it looks to implement new, innovative ideas.

Oberlin’s far from alone in these efforts.

For example, Denison University’s faculty came together to approve five new academic programs, ranging from global commerce to narrative nonfiction writing, within 18 months.

The Granville-based university wants to put a “pragmatic twist” on a classic liberal arts education, said vice president for enrollment management Gregory Sneed.

The university’s Center for Career Exploration helps connect students with internships, as well as practical life skills like how to use Excel or what the appropriate etiquette is for dining.

Denison has faced many of the same challenges as other liberal arts schools: the fear that graduates will end up on their parents’ couches, that all liberal arts campuses are “left-wing bastions,” and, of course, the inherent financial pressures, Sneed said. But applications have increased by about 60% in the last four years, he said, and the university has had a budget surplus multiple years in a row. He believes the university is doing well because it isn’t afraid to adapt.

Schools like Ohio Wesleyan are also working to identify and create majors that will help students find jobs, like data analytics and business administration, while continuing to stress its core values, Jones said.

Skills embraced in the liberal arts, like communication and teamwork, are valued by employers.

Another way some small liberal arts colleges have been adding value,

both in terms of options for students and in revenue for schools, is by adding adult, master’s or online programs, said Judy Muyskens. She joined Hiram College as interim vice president of academic affairs and dean in July with a strong back-

ground at liberal arts schools, having spent time at Nebraska Wesleyan University and Colby-Sawyer College in New Hampshire. Institutions have had to find their niche, Muyskens said, and build on those strengths.

In addition to relevance, the other

We have an account that is...

ALL BUSINESS BUSINESS SOLUTIONS

1.50

PLATINUM MONEY MARKET CHECKING

% APY

1

On balances $10,000 and above. myNYCB.com • (877) 786-6560

The Annual Percentage Yield (APY) is accurate as of date of publication. The minimum balance to open the Business Solutions Platinum Market Checking account is $5,000.00. The Business Solutions Platinum Money Market Checking account must be opened with new money not currently on deposit with the Bank. The account is a tiered rate account.

If your daily balance is $10,000.00 or more, the APY is 1.50%. For daily balances between $1.00 and $9,999.99, the APY is 0.01%. No interest is paid on balances below $1.00. Account subject to certain transaction limitations. Rate may change at any time before or after account is opened. Fees may reduce earnings. There will be a fee if your account is closed within 180 days of opening. Please talk to a branch representative or ask for our fee schedule for more details.

Offer is nontransferable.

Rate and offer is available for accounts opened in branches located in Ohio, Florida and Arizona only. Offer may be withdrawn at the discretion of the bank at any time. ©2018 New York Community Bank 1

PA G E 12

|

F E B R U A RY 12 - 18 , 2 018 |

CRAIN’S CLEVELAND BUSINESS

HIGHER EDUCATION

ideas ideals impact For results that resonate, change the equation.

Partner with Glenmede, an independent, privately-owned trust company offering investment and wealth management services. Founded in 1956 by the Pew family to manage their charitable assets, we provide customized solutions for families, endowments and foundations. To learn how our culture of innovation and experienced thinking can help you make your unique imprint on the future, contact Linda Olejko at 216-514-7876 or linda.olejko@glenmede.com.

HIGHLAND CENTRE, 3900 PARK EAST DRIVE, SUITE 100, BEACHWOOD, OH 44122

glenmede.com

@glenmede

/company/glenmede

PROMOTE. Why not?

Let the Custom Reprint Department help you leverage this great press.

For more information contact Laura Picariello, Reprints Sales Manager Tel (732) 723-0569 • Fax (888) 299-2205 • lpicariello@crain.com

35th Anniversary

35th Anniversary

CLEVELAND BUSINESS VOL. 36, NO. 47

NOVEMBER 23 - NOVEMBER 29, 2015

ALLYSON O’KEEFE, 37 Partner; Porter Wright

35th Anniversary

CLEVELAND BUSINESS

VOL. 36, NO. 47

NOVEMBER 23 - NOVEMBER 29, 2015 Allyson O’Keefe started her legal career at Porter Wright in 2004 after completing a summer internship there as a Case Western Reserve University law student. Since then, she has worked on many significant deals across Cleveland, including Flats East Bank, The Metropolitan at the 9, Uptown in University Circle and Steelyard Commons, and has been promoted to real estateALLYSON partner.

O’KEEFE, 37 “Young professionals who live downtown are so excited about the city,” said O’Keefe, a Partner; Porter Columbus native who lived downtown forWright 10 years before moving to Rocky River. “The ones who aren’t from here are often more excited about it. When you move here from somewhere else, you don’t for granted.”

VOL. 36, NO. take 47 it Allyson NOVEMBER 23 - NOVEMBER NOVE EMBER 29, 29, 2015 201 O’Keefe started her legal career at Porter Wright in 2004 after completing a sumWhen O’Keefe is not working or spending time with her husband and two children, she can mer internship there as a Case Western Reserve University law student. Since then, she has be found volunteering on the boards of nonprofit organizations and watching college football. worked on many significant deals across Cleveland, including Flats East Bank, The Metropolitan at the 9, Uptown in University Circle and Steelyard Commons, and has been proWHAT INSPIRES YOU ABOUT YOUR WORK? moted to real estateALLYSON partner.

O’KEEFE, Just seeing what Cleveland has gone through in the time that I’ve 37 been here, there’s obvious“Young professionals who live downtown are so excited about the city,” said O’Keefe, a ly a lot of excitement around real estatePartner; development.

I started in 2004 when we were crazy Porter Columbus native who lived downtown for Wright 10 years before moving to Rocky River. “The ones busy with development. That was sort of the boom from ’04 through ’08. I saw it go through who aren’t from here are often more excited about it. When you move here from somewhere the downturn, then I saw it rise again, even stronger than before locally. else, you don’t take it for granted.”

Allyson O’Keefe started her legal career eer at Porter Wright in 2004 after comple completing etin ng a sumsumWhen O’Keefe is not working or spending time with her husband and two children, she can mer internship as a Case Western Reserve University law student. Since tthen, hen, she sh he has has WORKED ON there ARE MIXED-USE URBANnPROJECTS. IS MANY OF THE PROJECTS YOU be found volunteering on the boards of nonprofit organizations and watching college football. worked on many significant deals across ss Cleveland, including Flats East Bank, The The THAT AN AREA OF EXPERTISE? Metropolitan at the 9, Uptown in every University and Steelyard Commons, and rsity d has has ha s been be een proproro Yes, definitely. Real estate is extremely interesting because deal Circle is differWHAT INSPIRES YOU ABOUT YOUR WORK? moted to real estate ent. You can never get bored because there’s so partner. much variety there, from tax Just seeing what Cleveland has gone through in the time that I’ve been here, there’s obviousown are O’Keefe e, a “Young who live downtown so excited about the city,” said O’Keefe, credits to historic renovations, from professionals ground-up development to rehab, from ly a lot of excitement around real estate development. I started in 2004 when we were crazy Rive er. “The “T “The ones ones mixed-use to residential. Columbus native who lived downtown for 10 years before moving to Rocky River. busy with development. That was sort of the boom from ’04 through ’08. I saw it go through who aren’t from here are often more excited xcited about it. When you move here from m somewhere som somew ewhere ere the downturn, then I saw it rise again, even stronger than before locally. else, you LEADERSHIP don’t take it for granted.”

YOUR STYLE? HOW WOULD YOU DESCRIBE

CLEVELAND BUSINESS USINESS

O’KeefeI expect is not working or spending timeI work, children, she can with her husband and two child dre en, sh he c he an I definitely believe in leadingWhen by example. the people withding whom MANY OF THE PROJECTS YOU WORKED ON ARE MIXED-USE URBAN PROJECTS. IS be found volunteering on the very boards off nonprofit and watching college collle eg ge football. foo fo ottball. my associates, to work hard, and they see me working hard.

For me, it’sorganizations all THAT AN AREA OF EXPERTISE? about working hard and doing good work.

Yes, definitely. Real estate is extremely interesting because every deal is differWHAT INSPIRES YOU ABOUT YOUR WORK? RK? ent. You can never get bored because there’s so much variety there, from tax hrough th here e’s obviousobviousus Just WHAT seeingWAS whatITCleveland has gone the time that I’ve been here, there’s LIKE TO WORK WITHthrough O’KEEFEinON WHAT OTHERS ARE SAYING: credits to historic renovations, from ground-up development to rehab, from ly a lot of excitement around real estate te development. I started in 2004 when we we were were e crazy crazy THE FLATS EAST BANK PROJECT? mixed-use to residential. busy with development. of the boom from ’04 through ’08. I saw itt go go through th hrough “Allyson is extremely bright and quick witted, butThat whatwas trulysort distinguishes her the downturn, then I saw itpeople rise again, even from most successful attorneys is her exceptional skills.

Shestronger has an than before locally.

HOW WOULD YOU DESCRIBE YOUR LEADERSHIP STYLE? uncanny ability to encourage the ‘adversaries’ in her negotiations to work in I definitely believe in leading by example. I expect the people with whom I work, OF THE PROJECTS YOU YOU WORKED Wsaid ORKED ON ON ARE ARE MIXED-USE MIXED-USE URBAN URBAN PROJECTS. PROJECTS. IS IS concert with her to achieve win/win MANY solutions to difficult problems,” my associates, to work hard, and they see me working very hard. For me, it’s all THAT AN AREA EXPERTISE? TISE?of the Scott Wolstein, CEO of Starwood Retail Partners andOF co-developer about working hard and doing good work. e is extremely interesting because every deal deal is differdifferrYes, definitely. Real estate Flats East Bank project. ent. You can never get bored there, red because there’s so much variety the ere, ffrom rom m ttax ax — Lee Chilcote WHAT OTHERS ARE SAYING: WHAT WAS IT LIKE TO WORK WITH O’KEEFE ON credits to historic renovations, tions, from ground-up development to rehab, re ehab, from fro om THE FLATS EAST BANK PROJECT? mixed-use to residential.

“Allyson is extremely bright and quick witted, but what truly distinguishes her

successfulInc. attorneys is reserved. her exceptional people skills. She has an Reprinted with permission from the Crain's Cleveland Business. © 2015from Crainmost Communications All Rights YOU DESCRIBE RIBE YOUR YOUR LEADERSHIP LEADERSHIP STYLE? STYLE? HOW WOULD ability to encourage the ‘adversaries’ in her negotiations to work in Further duplication without permission is prohibited. Visituncanny www.crainscleveland.com. #CC15040

I definitely believe in leading ding by example. I expect the people with h whom whom m I work, rk concert with her to achieve win/win solutions to difficult problems,” said my associates, to work hard, and they see me working very hard hard. d. For For me, me e, it’s all a Scott Wolstein, CEO of Starwood Retail Partners and co-developer of the about working hard and doing good work.

Flats East Bank project.

— Lee Chilcote YING: WHAT WHAT WAS WAS IT IT LIKE LIKE TO TO WORK WORK WITH WITH O’KEEFE O’KEEFE ON ON WHAT OTHERS ARE SAYING: THE FLATS EAST BANK PROJECT? PROJECT? “Allyson is extremely bright right and quick witted, but what truly distinguishes dis stin nguish hes her hes

skills s. She She has has an ha successfulInc. attorneys her exceptional people skills.

Reprinted with permission from the Crain's Cleveland Business. © 2015from Crainmost Communications All Rightsisreserved. ourage negotiatio ons to to work w wo orrk k in n ability to encourage the ‘adversaries’ in her negotiations Further duplication without permission is prohibited. Visituncanny www.crainscleveland.com. #CC15040

hieve win/win solutions to difficult probl bllem ms,” s,” said concert with her to achieve problems,” co-deve evel velo ve elo el ope pe er off the the e Scott Wolstein, CEO off Starwood Retail Partners and co-developer ct.

Flats East Bank project.

— Lee Le Ch Chilcote C

Reprinted with permission from the Crain's Cleveland Business. © 2015 Crain rain Communications nss IInc Inc. nc. nccc. All n Al Rights Rig rese reserved. rved d.

Further duplication without permission is prohibited. Visit www.crainscleveland.com. ww.crainscleveland. and.c nd d.ccom. o om. m #CC15040

Have YOU seen the

NEW TAX LEGISLATION?

There are a surprising number of provisions about tax-exempt entities in the Tax Cuts and Jobs Act. Our tax experts can help you sort through the complexity.

National level expertise; boutique firm attention.

Business Advisors and Certified Public Accountants

Contact Chris Anderson at 216-344-5268 or canderson@maloneynovotny.com

A phlebotomy classroom at Lakeland Community College features artificial arms on which students can practice.

(Photos by Peggy Turbett for Crain’s)

LAKELAND CONTINUED FROM PAGE 10

“The idea is that, if we can bring students in and give them some skill sets on problem-solving, on planning, on deferred gratification, then maybe we can give them the skills necessary, even if they don’t succeed here, but they can still succeed elsewhere,” said Morris W. Beverage Jr., Lakeland’s president.

When children are young, they’re all scientists, they’re all creative, Beverage said. But those skills are discouraged, so by the time students get to Lakeland, their “creative confidences are gone,” he said. And Hive aims to help students get reacquainted with those kinds of skill sets.

While some may view these investments as less-than-relevant to a community college, which has historically trained students in tangible skills for the workforce, Beverage views it as a greater good.

“I believe that all education leads to a better citizenry,” Beverage said.

“I believe that a community college education leads to a better community citizenry, because the majority of our students stay here. And so the students that are coming through here are, for the most part, going to stay here. So more than just simply knowing a trade or having a skill when they leave here, we want them to have an appreciation for diversity of ideas. We want them to have an appreciation for what came before them.”

But Hive likely will also appeal to the needs of industry. Students will be able to practice soft skills employers want like collaboration, communication and creativity, in addition to the technical skills they’ll learn at Lakeland, Hartmann said. Hartmann moved to the new building at the end of January. She said she hopes the space is fully operational by midMarch, though it will continue to evolve.

The first and second floors of the new building, which has yet to be named, are dedicated to the college’s health-related programs, with upgraded equipment and simulation labs, while the ground floor and the third floor are more for multidisciplinary use, with spaces where individuals or small groups can gather scattered throughout all levels.

The college’s existing Health Technologies Building — to which the new facility is attached — will maintain its name and its health focus, but at about 55,000 square feet, it was completely full.

The new design gave Lakeland the

Extension cords hang from the ceiling in a wood and metal workshop.

chance to intentionally locate some classrooms and faculty near one another, like surgical technology and nursing, because, as Beverage said, today’s health education has a focus on teamwork. And it gave it the space to add to its health program offerings. For example, in fall 2018, the college will be adding a certificate program for polysomnography — the study of sleep disorders — and an associate’s degree program for occupational therapy assistants. It will also be adding a physical therapy assistant program in 2019.

But while the building opened for classes in January, some of its most attention-catching components — like Hive — were still being built out.

Take, for example, the new building’s third-floor greenhouse, which will be used as a classroom and as a place for students to come in and study. Similarly, the greenhouse has an adjacent room where guests can look in without the dust and humidity, and a rooftop garden next to a window-filled classroom.

These rooms — including the greenhouse — aren’t meant to be science labs, but instead to be used by a variety of disciplines, like art or accounting, to get students thinking differently. For example, Beverage said students in an accounting class in the greenhouse classroom could compare the costs that go into particular plants, from raw materials to labor to operating costs.

“What we’re hoping to do is to draw nature into the learning process,” Beverage said.

CRAIN’S CLEVELAND BUSINESS

|

F E B R U A RY 12 - 18 , 2 018

|

PA G E 13

HIGHER EDUCATION UNITED IN DISCOVERY Adviser: Christopher B. Anderson

Tax reform could challenge colleges Although focused on individual and business tax reform, the Tax Cuts and Jobs Act of 2017 (TCJA) contains a surprising number of provisions which affect colleges and universities. These provisions are generally effective for tax years beginning after Dec. 31, 2017.

The largest change relates to how colleges treat taxable unrelated business income from multiple activities.

Before TCJA, tax-exempt organizations were permitted to net a loss from one unrelated activity against the income of another.

This netting process allowed colleges to realize significant savings by paying tax only on their net unrelated income.

TCJA prohibits netting losses with income and instead requires tracking each unrelated activity separately. A loss from one unrelated activity will have to be carried forward to a future year when that activity produces income.

Another provision of (the Tax Cuts and Jobs Act) provides that an institution’s unrelated business income will be increased by the value of certain fringe benefits provided to employees. Such benefits include the use of on-campus gyms and other athletic facilities, and certain formerly tax-free transportation benefits.

For losses that originated in tax years beginning before Jan. 1, 2018, which were not subject to TCJA’s changes, colleges will be permitted to use those losses to offset any unrelated income in 2018 and beyond until depleted.

The tax rate on unrelated business income drops to 21%, the same rate used by for-profit corporations. This flat tax rate replaces the graduated rate structure, which spanned from 15% to 35%.

Private colleges with large endowments face a new excise tax of 1.4% on net investment income. To be subject to this tax, the institution must have had at least 500 students during the preceding year, more than 50% of which must attend class in the U.S. Additionally, the fair market value of the institution’s assets at the end of the preceding year must be at least $500,000 per student. Assets used directly in carrying out exempt purposes are excluded in this determination, but assets of related

DRIVEN BY PURPOSE

Anderson is a CPA and shareholder at Maloney + Novotny, a Cleveland accounting firm.

organizations must be considered if the assets are available for the use or benefit of the institution.

Congress has instructed the Secretary of Treasury to issue regulations to provide guidance on complying with the new excise tax. Such guidance will describe how to determine which assets are used in carrying out exempt purposes, how to compute net investment income, and how to determine which assets of related organizations must be included in the calculation.

Another provision of TCJA provides that an institution’s unrelated business income will be increased by the value of certain fringe benefits provided to employees. Such benefits include the use of on-campus gyms and other athletic facilities, and certain formerly tax-free transportation benefits.

Valuing the athletic facility usage may prove to be difficult for many institutions, particularly those that do not offer memberships to outsiders.

Counting the number of employees who use the facilities will also be challenging and may cause institutions to consider opt-in policies or separate ID cards to track usage.

TCJA also imposes an excise tax of 21% on compensation of covered employees that exceeds $1 million and any excess parachute payments.

A covered employee is one of the five highest-paid employees for the taxable year, and once a person meets the covered employee definition, the person will remain a covered employee for future years.

For purposes of determining the amount of the excise tax, compensation which has not yet vested is not included.

Although not common in higher education, an excess parachute payment is one that is paid because of the employee’s separation and exceeds three times the employee’s base compensation.

Other provisions in TCJA include the repeal of advance refunding bonds, the repeal of the 80% charitable contribution deduction for payments for athletic seating rights, and the increase in the deduction limit for charitable contributions of cash by individuals from 50% of the donor’s adjusted gross income to 60%.

TCJA’s provisions are complex and will be challenging to implement.

Colleges and their advisers will need substantial guidance from the IRS to fully comply with these new provisions.

With all of the other provisions in TCJA that affect many more taxpayers, it may take the IRS a considerable amount of time to provide needed assistance to the higher education community.

BOUNDLESS INNOVATION. It’s what happens when people from different specialties work together to create something new and amazing. Like when a liquid crystal researcher at Kent State University got together with a fashion designer and a medical researcher to create a temperature-sensing fabric that can help diabetic patients monitor their condition.

Purposeful collaboration like this happens every day at Kent State University. Purpose is what powers us, inspires us and drives the innovation we create to change our world.

PURPOSE.KENT.EDU KENT STATE UNIVERSITY, KENT STATE AND KSU ARE REGISTERED TRADEMARKS AND MAY NOT BE USED WITHOUT PERMISSION. KENT STATE UNIVERSITY IS COMMITTED TO ATTAINING EXCELLENCE THROUGH THE RECRUITMENT AND RETENTION OF A DIVERSE STUDENT BODY AND WORKFORCE. 17-UR-00332-239

LEARN ARN MORE TODAY ABOUT HOW CRAIN’S CAN HELP YOU AND YOUR CONTENT MARKETING PROGRAM. Contact Amy Stoessel at 216.771.5155 or astoessel@crain.com.

iddlefield Banking Company Welcomes

Jack Gregorin A solid banking relationship begins with discussions about your business, your goals and what it takes to achieve them. The input of an experienced banking partner is invaluable, and Jack has been that kind of partner to businesses in Northeast Ohio for over 35 years.

Contact Jack for working capital lines of credit, equipment loans, or your commercial real estate financing needs. His direct number is 216.359.5527.

See what a difference a Community Bank can make.

Beachwood Office 25201 Chagrin Boulevard, Suite 120 • Beachwood, OH 44122 216.359.5527

middlefieldbank.bank • 888.801.1666 Northeast Ohio Region Offices in: Beachwood • Chardon • Cortland • Garrettsville Lake County Loan Production Office • Mantua • Middlefield • Newbury • Orwell • Solon • Twinsburg Central Ohio Region Offices in: Dublin • Sunbury • Westerville

PA G E 14

|

F E B R U A RY 12 - 18 , 2 018 |

CRAIN’S CLEVELAND BUSINESS

AKRON

DriveIT aims to rev up mid-career IT training

By DAN SHINGLER dshingler@crain.com @DanShingler

Akron will soon have a new software and information technology training center up and running under the tutelage of Software Guild founders Eric Wise and Eric Ward.

This time, the effort is not aimed at computer neophytes but at working IT professionals in the region. It’s a company called DriveIT that Wise began talking about last year with workforce developers.

Wise and Ward are joined in the new startup by co-founder Ian Schwarber, who previously co-founded the EXL Center for experiential learning at the University of Akron and has long been a proponent of entrepreneurial and educational efforts in Akron.

“When I founded EXL, I became deeply involved in the Akron entrepreneurial/innovation community, and in my opinion, I found none better than the Software Guild,” Schwarber said. “I think the feeling was mutual, because we knew early on we were going to build something together next time around.”

He and Ward are minority owners in DriveIT. Wise will be the largest shareholder and said a small group of private local investors will be minority owners.

The new company will be based on White Pond Drive, on the fourth floor of the same building near I-77 that houses Stark State College, while the college’s permanent Akron campus on Perkins Street is being built.

“We’ll have two classrooms and a collaborative space,” Wise said.

DriveIT will offer training courses,

Eric Wise, co-founder of DriveIT, teaches a class at the Software Guild, a coding bootcamp, in 2013. DriveIT, instead, will focus on mid-career training for IT professionals. (File photo)

called “workouts,” as hands-on classes led by industry experts in specific technologies, Wise said. The workouts each will run two to four weeks, usually with classes held two evenings a week and some shorter weekend sessions.

“It’s going to start slow and ramp up as we get more members. In April, we’ll be offering probably six or seven workouts,” Wise said.

Courses will cover not only a broad range of software development skills, but also topics such as business intelligence, cybersecurity and even address some interpersonal skills that Wise says some IT professionals need for their careers.

Wise will be CEO, and Ward will serve as chief learning officer. They were a management team at the Software Guild, which Wise sold in 2015.

Schwarber joins the team as chief strategy officer.

DriveIT’s concept is what Wise refers to as “gym membership” training. Companies, or individuals, can

buy a membership for $3,600 per year, per person. After that, a member can take as many of the offered courses as they like — and it will be DriveIT’s task to make sure it offers the coursework they want. Some a la cart course offerings will be available, and companies will be able to get discounts for large groups of members, Wise said.

So far, four large Akron companies have agreed to buy memberships for their employees, along with about 10 medium-size and smaller companies, Wise said.

He isn’t naming them yet, but his location is near major local employers already, including a local arm of Akron Children’s Hospital and FirstEnergy Corp.’s West Akron Campus and the site of its planned $37 million technical center.

“We’re prepared to handle between 1,200 and 1,500 (members) at that location. If it goes beyond that, we’ll expand it. … and we’ll be moving into Cleveland and Columbus

pretty quickly, too,” Wise said.

Wise hopes to announce plans for expansion into Cleveland later this year, but said it’s too soon to talk about where that operation might be or with whom it will partner.

DriveIT’s business model meets a real need for mid-career level technical training in Akron — and likely other places as well. It’s especially in demand from people who don’t necessarily want to move up into management and administration, but do want to move up in their technical field, Wise said.

While DriveIT has just begun to seek corporate clients, demand is already strong, Wise said.

“I actually think I may have underestimated this,” he said.

Sue Lacy isn’t surprised. The president of the workforce development nonprofit ConxusNEO said she knows firsthand that local companies are hungry for both new mid-level IT employees and for ways to keep and advance the ones they already have.

“We’re really falling short in terms of preparing talent to fill those positions, so the strategy to work with companies that have solid middle-level employees who want to upskill — this is a great business model,” Lacy said.

It’s also good for economic development efforts, she said, because a deep IT talent pool is something companies look for when evaluating a new area and is just as important for companies seeking to stay here.

“I think this offers the opportunity to retain a higher percentage of employees, and we see there’s a lot of movement in this industry sector,” Lacy said. “As a company offers this sort of upscaling opportunity, that’s going to make it attractive to stay

with that employer … And, clearly, if you have to recruit from outside of the region for some of these middle-skill jobs, it’s going to cost you money.”

Wise, Ward and Schwarber also are launching something else that Lacy said she strongly supports: a nonprofit, funded by DriveIT, called EcosySTEM. It will work with underprivileged students and their teachers to help encourage interest in STEM coursework, provide the tools to teach it and to get technical people involved in education efforts, DriveIT founders said.

That won’t be a new sector for the group, as Ward currently works with Akron’s North High School on STEM education and Schwarber has worked with St. Vincent de Paul Parish School and other schools in Akron.

Wise has also volunteered many hours of his time to help ConxusNEO, Lacy said.

She predicts his passion, along with a good business model, will mean DriveIT is likely to succeed.

DriveIT’s membership cost, $3,600, could be cheaper than sending an IT professional to a single conference, Lacy said, and that usually also involves travel expenses.

“And coding boot camps are getting expensive. Some are $15,000,” Lacy said.

As for downtown Akron, Wise said he’s not abandoning that. DriveIT will have a presence in the city’s planned Bounce Innovation Hub, he said.

“We’re very supportive of the mayor’s Bounce initiative, and we’re in discussions with them to have something in the Bounce space,” he said.

“So White Pond will be the home office, and then we’ll have something at Bounce as well.”

New venture provides entrepreneurial support

By JUDY STRINGER clbfreelancer@crain.com

Da’Shika Wells didn’t have a lot in the way of professional relationships when she set out to start a marketing company in 2014.

The Akron native had a few contacts left over from her career before becoming a stay-at-home mom, but the list was far short of an actionable network. As the questions piled up — about finance, outsourcing, hiring, even branding her fledgling firm, VineWorks Marketing — Wells had nowhere to turn.

Today, the Rubber City business owner is on a mission to ensure female entrepreneurs, particularly African-American women, don’t find themselves in a similar predicament.

“In the U.S., women are the fastest-growing group of entrepreneurs, and African-American women are the fastest-growing segment of entrepreneurs within that group,” she said.

“I wanted to be able to speak directly to them, give them the information and guidance I did not have.”

Late last month, Wells published the first issue of Official B.A.B.E Magazine. B.A.B.E stands for Black and Brilliant Entrepreneur. The quarterly publication, exclusively digital for now, features articles and advice from a collection of 14 contributors across the country. The content is meant to inspire and empower Afri-

Da’Shika Wells saw a need to lend support to female African-American entrepreneurs like herself, so she started the Official B.A.B.E Magazine, which features articles and advice from contributors across the country. (Shane Wynn for Crain’s)

can-American women with a business idea or while starting or building an organization.

“For myself and a lot of the African-American women that I am associated with either personally or professionally, we didn’t have a lot of those resources or experiences that maybe people in other demographics did,” Wells explained, “such as having conversations at the dinner table about the day at the office and Dad ran the office, or watching or hearing about filing a business’ taxes

or investing.

“I want to shed some light on those experiences that are disparate in our personal community and in our professional community.”

Wells said she never really set out to create a magazine — digital or otherwise. Based on her own struggle with business resources, she simply wanted to curate the collective knowledge of successful peers and let their experiences and expertise guide others going down a similar path. As she began vocalizing those

aspirations, first at a women’s retreat in New Orleans and later by reaching out to her social media followers, contributors began stepping forward and Official B.A.B.E. was born.

Full content is available by subscription only. An annual subscription costs $14.99. The Official B.A.B.E website, which debuted in November, includes snippets from the articles.

The magazine aims to deliver interviews with some of the nation’s leading African-American female business owners. The premier issue, for example, features Southern Girl Desserts owners Catarah Hampshire and Shoneji Robison, who won the eighth season of the reality baking show “Cupcake Wars.” Other topics include leadership, marketing and branding, finance, work-life balance and wellness. Contributors also review books and apps that are pertinent to business owners.

Siobhan Sudberry, founder and creator of the BeFree Project and a Cleveland-based life coach, provides book reviews, giving readers a glimpse into publications that have helped her build and sustain a business. Sudberry started BeFree four years ago and — like Wells — didn’t have many people she could connect with for questions or advice, or just to vent or celebrate.

“In my experience, being an entrepreneur was very lonely,” she said.

While Sudberry has built up a support network over the years, she

jumped at the chance of being part of “a community of support” for women just starting out.

“You don’t have to figure it out on your own,” she said.

“This is not a boring publication with just numbers and ROI,” Wells said. “We get into that, but really the focus is speaking at a level that is inviting and resonates to the real woman. Someone might be reading the magazine after she just got done mixing shea butter in her sink to sell at a market, or maybe she held a whiny baby on her lap while she wrote one of the most important emails of her life. This is real life. We want to speak to the women in a way that shows we understand it.”

While Official B.A.B.E. is directed at African-American women, Wells said the content is “pretty universal.”

Women of any race — and for that fact, men — could glean valuable and applicable advice from its pages, she said. Not all of the contributors are African-American. None of the current contributors or interview subjects are men, but she is not opposed to that.

“If this person is doing some amazing things and we have an exclusive interview in which he or she can share some insight or recipes for success with readers, race and gender do not really matter,” she said. “I don’t have all the answers and neither do my writers, but we want to share what we do know, what we have learned.”

C O N T E N T

P R E S E N T E D

B Y :

DEVELOPING A STRONG FOUNDATION THROUGH NETWORKING AND EDUCATION S

ales & Marketing Executives (SME) of Cleveland focuses on assisting sales and marketing professionals in reaching their professional goals and improving their skills by connecting people.

Executive director Mary Margaret Lavelle supports SME Cleveland’s more than 300 members, 36 corporate members and seven corporate sponsors by helping the professional networking community to connect, learn and succeed.

SME Cleveland’s 57th annual Distinguished Marketing & Sales (DMSA) Awards Banquet is the profession’s premier honor to acknowledge excellence and provide recognition for outstanding sales and marketing achievement. The awards will be presented this year on Feb. 22 at Executive Caterers at Landerhaven and will honor the Business Executive of the Year and some of the area’s elite business professionals. Selection criteria are based on the demonstration of the highest business, professional and ethical standards.

Chuck Fenske, vice president of marketing and business development for Knoch Corp. in North Canton, said the DMSA program is recognition of years spent mastering the craft of sales and marketing.

“It provides validation that you are one of the est in o r field in ortheast hio said enske a 2017 DMSA recipient.

SME Cleveland helps its members broaden their perspective, gaining more leads, growing their business and perfecting professional development and networking.

“I think networking organizations like this allow people fro the sales and arketing field to comingle, to meet up, to understand the different ind stries and hat s going on sa s artin senior partner and head of marketing for JumpStart, and a former DMSA recipient. “It’s a great tool and it reall helps the p-and-co ing siness class to get that strong foundation needed to help them drive their careers for ard Former DMSA recipient Sharrona Burns, senior director of sales for the Rock & Roll Hall of Fame and an SME Cleveland board member, said the organization not only helped her personally, but it enefited her entire sales depart ent “The networking opportunities allow me to generate new leads, build relationships and grow sales rns said he S orkshops provide affordable professional development for me and my entire department of sales representatives.

“Thanks to SME Cleveland, the Rock & Roll Hall of Fame sales department is able to participate in several workshops a year to learn the latest trends and best practices in the marketing and sales ind str

S P O N O S O R E D

C O N T E N T

CONTENT PRESENTED BY: S2 February 12, 2018

“

“

If we could parade all 3,500 people on the stage, we would totally do that.

We cherish and value our people that make Heinen’s what it is.

TOM HEINEN

Ordinary people doing extraordinary things I

n 1929, German immigrant Joseph H. Heinen opened a small butcher shop in Shaker Heights. Over time he added homemade peanut butter, pickles, donuts, produce and canned goods. By 1933, Heinen’s Grocery Store was born.

Today, grandsons Tom and Jeff Heinen are the third generation to lead what is now a 23-store, family-owned chain with 19 stores in Cleveland and four in Chicago.

There also is a manufacturing plant and two warehouses in Warrensville Heights. Its most ambitious location in downtown Cleveland was unveiled in 2014 with the redevelopment of the 1908 Cleveland Trust building on Euclid Avenue.

Twins Tom and Jeff Heinen have worked in various areas of the company in their 40 years in the business. Jeff’s son ake eat anager at the a field Village store, is the fourth generation to work in the company.

BUSINESS EVOLUTION The complexity of the grocery business has increased in the last 40 years — from what is sold, to the different depart ents to the diversification of various proteins as well as the frozen

2018

BUSINESS EXECUTIVES OF THE YEAR: TOM & JEFF HEINEN

and dairy departments.

But Tom Heinen says their business is simple.

“It’s about people and product,” he says. “My grandfather was always very careful about who and where he bought his food from. He was very driven by where he got it and who he got it from. We’ve become a very sourcing-interested company.”

Having a team of experts knowledgeable about the products they sell helps Heinen’s differentiate itself through

service and quality. Tom Heinen says building relationships is key. Heinen’s produce managers, for example, deal directly with growers, cultivating a 365-day-a-year relationship.

“The big evolution is we have people who learn about the products,” Tom Heinen says. “We sell 45,000 authorized items, so no one knows everything about all items.

But we put a team together we hope become subject matter experts in what they sell so they can help customers understand what they are looking for.”

The Business Executive of the Year Award, Tom Heinen says, is more of a recognition for the company’s “incredible associates.”

“We rise and fall on the backs of everyone who works here,” he says, adding that many positions are full time, as opposed to the industry standard of part time. “If we could parade all 3,500 people on the stage, we would totally do that. We cherish and value our people that make Heinen’s what it is.” einen s is filled like all s ccessf l organizations — simply ordinary people doing extraordinary things.

That’s who we are.”

THE FUTURE The company’s newest partnership

SUBMITTED PHOTO

Tom (left) and Jeff Heinen

with instacart now provides online ordering and delivery. Tom Heinen says the e-commerce piece of the industry is something all food retailers need to tr to fig re o t

“If you want to go fast, go alone.

If you want to go far, go together.”

- African Proverb

Tom Heinen says the company is always looking for opportunities, but after opening four stores in 10 months with the addition of the Chicago and downtown Cleveland stores, as well as opening a new manufacturing plant last summer, the company is focusing on how to improve operations.

“We’ve settled into believing we need to fine t ne hat e re doing right now while somewhat looking for growth opportunities,” he says.

He summed up Heinen’s like this: “Simply ordinary people doing extraordinary things. That’s who we are.”

We can help you go the distance.

Real People.

Real Answers.

Frank Fantozzi

Managing editor, custom and special projects: Amy Ann Stoessel, astoessel@crain.com

CPA, MST, PFS, CDFA, AIF® President and Founder

Wealth planning for individuals, families, and businesses.

Writer: Kimberly Bonvissuto

Contact us today at ®

PlannedFinancial.com

Graphic designer: Staci Buck

or 440.740.0130.

BRECKSVILLE: 7000 Fitzwater Road, Suite 300, Cleveland, Ohio 44141 BEACHWOOD: 3690 Orange Place, Suite 370, Cleveland, Ohio 44122

Investment advice offered through Planned Financial Services, a Registered Investment Advisor

1 St. Clair Ave NE Cleveland, OH, 44114 www.clevelandconventions.com www.theglobalcenter.com

For more information about custom publishing opportunities, please contact Amy Ann Stoessel.

S P O N O S O R E D

C O N T E N T

CONTENT PRESENTED BY: February 12, 2018 S3

2018

Distinguished Marketing and Sales Award Recipients Teri Agosta

Mike Bloomstine

Hilton Cleveland Downtown

ESPN Cleveland

GENERAL MANAGER

T

he Hilton Cleveland Downtown opened in June 2016, accommodating the Cleveland Cavaliers’ NBA championship run, the Republican National Convention and the Cleveland Indians’ orld Series r n all in its first si onths of operation nd leading the charge as eri gosta general anager of the -roo convention center-st le hotel gosta is responsi le for the facilit s da -to-da operations She s ccessf ll led the hotel in eeting its financial e pectations hile hiring ore than tea e ers he hospital ind str veteran orked ore than ears in vario s general anager and director of arketing positions at ilton orld ide hotels as ell as at independent and o ti e properties efore leveland she as general anager of the ointe ilton S a eak esorts in hoeni gosta is the recipient of several a ards incl ding ilton s ard for perational fficienc and ffectiveness and rofita ilit ard- ointe ilton S a eak She as honored as eneral anager of the ear the ospitalit Sales arketing ssociation nternational rizona chapter in She earned her ndergrad ate degree in siness ad inistration and arketing at rand alle niversit in ichigan and st died at nstit te o rs in rance

DIGITAL DIRECTOR

A

s S leveland s digital director ike loo stine is responsi le for the creative vision and e ec tion of c sto ized digital sol tions for arketing partners hich incl des advertising sol tions on the S app atch S S co S and S loo stine egan his career ith ood ar a rands e s held var ing roles at S leveland incl ding as partnership coordinator creative services specialist and director of arketing and creative services contri ting to design pro ects and develop ent e ilt and trained a creative tea that prod ces rich edia and static and video ads for si arkets totaling ore than illion in sales e also anages the arketing tea in leveland overseeing ore than events ann all and he advises and assists in anaging the S leveland itter acco nt loo stine is a native of ake ood altho gh he gre p in rie a and grad ated fro rovidence ollege ith a degree in econo ics e lives in do nto n leveland

Christina Capadona-Schmitz

Frank Fantozzi

VICE PRESIDENT, DIRECTOR OF MARKETING, COMMUNICATIONS AND MEDIA

PRESIDENT, FOUNDER

Planned Financial Services

Oswald Companies

C

hristina apadona-Sch itz is a arketing co nications leader ith nearl ears of e perience in the field ith an earl career ackgro nd in the digital arketing start p space she foc sed her professional practice on the transfor ation and colla oration of organizational arketing co nications and operations for a f ll range of ind stries apadona-Sch itz is vice president director of arketing co nications and edia for s ald o panies one of the nation s largest independent ins rance rokerage and risk anage ent fir s She anages the arketing tea and design specialists and directs the strateg and e ec tion of corporate- ide efforts She p lishes reg larl on arketing co nications and leadership and has served as a g est presenter and panelist e er at vario s siness and ed cational events She is a oard e er and secretar for the est Side atholic enter leveland co-fo nder and senior adviser of os ald S o ng rofessional and erging eader nitiative and an ss re lo al rand co ittee e er apadona-Sch itz is fo nder of o n ithSpit p co the virt al infant re e s pport s ste for parents and caregivers and its signat re prod ct i ilder She has special interests in career development and entrepreneurship, with an emphasis on supporting emerging leaders and o en-o ned sinesses

S P O N O S O R E D

C O N T E N T

F

rank antozzi fo nded lanned inancial Services in to ake a difference in the lives of fa ilies siness o ners and co nit leaders he fir has offices in recksville and each ood advising clients in states e egan his career in ith rth r ndersen and in he eca e a certified p lic acco ntant e earned his ndergrad ate degree in acco nting fro ase estern eserve niversit and his grad ate degree in ta ation fro niversit of llinois at r ana- ha paign e holds the designation as an erican nstit te of ertified lic cco ntants personal financial specialist and is an accredited invest ent fid ciar n antozzi as na ed a top S etire ent lan dviser the Financial Times e is involved ith the s ta and financial planning s co ittees the nternational ssociation for inancial lanning the nstit te for ivorce inancial nal sts i and ntreprene rs rganization e is the recipient of ltiple siness and professional a ards e fo nded recksvilleroadvie eights Soccer rganization and s pports hild nd and the o nded arrior ro ect e also is a tr stee of ife ct antozzi lives ith his ife a lette in recksville and has t o da ghters icole and atalie

CONTENT PRESENTED BY: S4 February 12, 2018

Cristina Fronzaglia Murray

Michelle Frietchen Gandolf

DIRECTOR OF COMMUNICATIONS AND CUSTOMER ENGAGEMENT

DIRECTOR, MARKET RESEARCH AND INSIGHTS

Cleveland Clinic

F

or more than 20 years, Michelle Frietchen Gandolf has worked in the Market Research and Insights Department at the Cleveland Clinic. As director, she is involved in strategic initiatives that include patient experience, business development and branding strategy.

She has moderated more than 150 focus groups and one-on-one interviews for a range of service lines and business units. She also has conducted several positioning, advertising tracking, and image and awareness studies, and construction design research.

Gandolf consults for several internal areas at Cleveland Clinic. She also serves on multiple committees and is co-chair of Women in Search of Excellence, an employee resource group that provides growth opportunities for Cleveland Clinic female caregivers.

She mentors students at the EDGE Fellows Summer Intern Program, which pairs graduate student teams with experienced business mentors. She also mentors students in the Case Western Reserve University marketing analytics program.

Gandolf lives in Brunswick with her two teen daughters. She holds an undergraduate degree in marketing and quantitative business analysis, and a graduate degree in consumer/industrial research from Cleveland State University.

PPG Automotive Refinish

C

ristina Fronzaglia Murray began her PPG career as a sales trainee. She has worked through various sales and marketing positions, from light industrial coatings sales representative and program development to product marketing and communications manager.

Murray has broad experience in B2B marketing with the ability to lead a team in accomplishing innovative marketing initiatives leading to increased sales and e traordinar profit gro th She is skilled in strategic planning traditional and emerging media planning, brand strategy and management, market research, sales sponsorships and product positioning.

She is the recipient of several a to otive refinish ind str a ards incl ding 2011 Goodguys Woman of the Year, 2014 SEMA Businesswomen’s Network thena ha pion and o en s nd str et ork ost n ential Women in Collision Repair. She is a board member for Girls With Sole.

Murray earned her undergraduate degree in marketing from Duquesne University in Pittsburgh and her graduate degree in marketing from Franklin University in Columbus. She lives in Lakewood with her husband, daughter and dog.

Stephanie Hampson SENIOR SALES CONSULTANT

Medical Mutual of Ohio

A

s a senior sales consultant at Medical Mutual of Ohio, Stephanie Hampson manages sales in the health insurance business for the company’s Northeast Ohio region. She has extensive experience in strategic account management, group underwriting and professional sales training and is responsible for monitoring CONTINUED ON NEXT PAGE

Congratulations

Join us.

As we celebrate the Sales & Marketing Executives of Cleveland. Our sales professionals offer investments, wealth planning and retirement plan solutions — with a personalized service that’s focused on helping you to get more out of life.

Teri Agosta for winning the 2018 Distinguished Marketing and Sales Award!

216-825-4000 / www.ancora.net

Photo: Brad Feinknopf

S P O N O S O R E D

C O N T E N T

CONTENT PRESENTED BY: February 12, 2018 S5

CONTINUED FROM PREVIOUS PAGE

and overseeing all sales processes and procedures for new business.

Working closely with Medical Mutual’s product development team on emerging projects and product rollouts, Hampson was involved in the introduction of several key innovative solutions for the company. Prior to her current role, she managed the large group commercial service team.

Hampson, who for the past three years has been named company-wide sales leader, surpassed her annual goal in 2016 by 225% and was responsible for $56 million in new business revenue in 2017.

She earned her ndergrad ate and grad ate degrees fro iffin niversit She is a member of Medical Mutual’s Emerging Leaders program and WELD (Women for Economic and Leadership Development), and she is on the steering committee for the Greater Cleveland Partnership’s Middle Market Initiative.

REDEFINING CORPORATE HOSPITALITY

Fred Kemp

ACCOUNT EXECUTIVE

The Shamrock Companies

Conferences • Trade Shows • Meetings • Fundraisers • Ceremonies • Celebrations

A

s account executive for The Shamrock Companies, Fred Kemp is responsible for all aspects of creating and executing clients arketing print f lfill ent kitting and distribution services. He also oversees strategic and tactical execution of projects, while keeping up to date with the latest industry developments. ealizing he had a nat ral aptit de and affinit for sales e p ca e to Cleveland from a small farming community in central Ohio and began building a sales career. After choosing print and marketing sales as a focus area, he began following the late motivational speaker Zig Ziglar at conferences around the country. He joined Toastmasters International, assuming the presidency for a local chapter in 1983.

Kemp has earned numerous sales and achievement awards spanning his 40 years in business. He chairs the Bow Tie Society at The Union Club of Cleveland.

In his free time he enjoys theater, music, running, Airstream camping and restoring his Bratenahl home with his spouse. He has three grown children.

ICONIC VENUES

AWARD-WINNING CUISINE

STATE-OF-THE-ART AV

ALL-IN-ONE SERVICE

440.449.0700 EXECUTIVECATERERS.COM

TM

18 PARK RESERVATIONS

Nationally Acclaimed Zoo

Dori E. Kish SALES MANAGER

Huntington Convention Center of Cleveland

Four-Time Winner

A

s the sales manager of the Huntington Convention Center of Cleveland, Dori Kish is responsible for bringing in nearly 450 events into Cleveland, generating $12.84 million in convention and trade show business.

She also is an entrepreneur and fundraiser, with a special focus on major business verticals, including wellness, technology and telecommunications.

Prior to joining SMG Worldwide Entertainment & Convention Venue Management, which manages the convention center, Kish was a business develop ent strategist at fficient olla orative etail arketing in Solon consistentl finishing in the top in onthl sales She also as a territor manager for Maybelline Garnier, L’Oreal USA. Her entrepreneurial pursuits include founding Avon-based Sun Spray Salon.

In the community, Kish is actively involved with the Federal Bureau of Investigation Citizens Academy, American Heart Association Go Red For Women, the Cuyahoga County/Ohio Department of Correction Board for Reentry, and voluntary chair of the Cleveland Cares Medical Mission fundraising event for Cleveland Clinic Dermatology & Plastic Surgery Institute.

Kish earned her undergraduate degree in business administration from Kent State University.

S P O N O S O R E D

C O N T E N T

8 GOLF COURSES

OVER 23,000 acres Cleveland Metroparks congratulates Kelly Manderfield, Chief Marketing Officer Distinguished Marketing and Sales Award Recipient clevelandmetroparks.com

CONTENT PRESENTED BY: S6 February 12, 2018

Brock Malinowski OWNER

Hixson & Malinowski Insurance Agency LLC, Malinowski Properties LLC

B

rock Malinowski of Brecksville is an entrepreneur and lifelong resident of the Cleveland area. After graduating in 2010 with a degree in economics fro ohn arroll niversit he started his first co pan The Malinowski Agency LLC. In 2017, he combined with the Hec Hixson Agency LLC to form Hixson & Malinowski Insurance Agency LLC. The company, which employs 15, works to bring comprehensive risk management to every household and business working with the agency.

Malinowski also owns Malinowski Properties LLC, a real estate sales and investing co pan and is part o ner of it n hich orks to ild fitness and confidence in children ages - thro gh sports leag es ca ps and skill clinics Malinowski works with new and aspiring members of the business community through John Carroll’s Network for Success and mentorship program. In his free time, Malinowski enjoys having tea parties with his daughter, Brooklyn, and checking out new restaurants and cocktails with his wife, Amanda.

Josh Studzinski University Hospitals Director, System Events and Sponsorships

Proud to be part of your community.

UH proudly supports SME as they honor Josh Studzinski and all of the 2018 DMSA Award recipients.

Kelly M. Manderfield CHIEF MARKETING OFFICER

Our experts will see you now.

1-866-UH4-CARE | UHhospitals.org

Cleveland Metroparks

K CONGRATULATIONS to the 2018 SME DMSA Award Winners from...

ell anderfield leads all arketing initiatives across Cleveland Metroparks’ 18 park reservations, eight golf courses, dining, retail and a nationally acclaimed zoo. She is a critical member of the team that earned Cleveland Metroparks the 2016 National Gold Medal Award for excellence in Park and Recreation CONTINUED ON NEXT PAGE

For over 86 years, Heinen’s has been selling quality groceries while supporting its neighboring businesses by sourcing For over 86 years, Heinen’s has been providing quality many of while its products locally. groceries sourcing and supporting local artisans.

O U R CO M M I T M E N T. Congratulations to Tom & Jeff Heinen for

GRAPHIC DESIGN • DIGITAL MARKETING • VIDEO • TOUCHSCREENS • COPYWRITING • PACKAGING

CONGRATULATIONS TO being named SME Cleveland 2018 TOM & JEFF HEINEN Business Executives of the Year.

FOR BEING NAMED SME CLEVELAND 2018 BUSINESS EXECUTIVES OF THE YEAR.

We’re thinkers, designers, doers and go-getters.

Let us help you turn your marketing ideas into effective selling tools. phone: 440.526.8104

website: dennisoncreative.com ©2018 Heinen’s Grocery Store

32839 Dennison 6x6 Crain's DMSA Ad_options.indd 2

1/25/18 6:14 PM

S P O N O S O R E D

C O N T E N T

CONTENT PRESENTED BY: February 12, 2018 S7

CONTINUED FROM PREVIOUS PAGE

anage ent a arded the erican cade for ark and ecreation d inistration in partnership ith the ational ecreation and ark ssociation nder her leadership leveland etroparks developed and e ec ted several transfor ative rand ca paigns incl ding o e t and la and the centennial ca paigns She also led a re randing of leveland etroparks oo ringing ildlife conservation to the forefront She oversees co nications advertising research special events event rentals corporate partnerships retail and vis al co nications rior to oining leveland etroparks anderfield as arketing strategist and vice president at e orp here she also held positions as senior arketing anager vice president and senior progra anager t e orp she oversa national arketing progra s and advertising ca paigns She earned her ndergrad ate degree in co nication fro o ling reen State niversit and a grad ate degree in applied co nication theor and ethodolog fro leveland State niversit

Ed McQuiston

EXECUTIVE VICE PRESIDENT, CHIEF COMMERCIAL OFFICER

Kyle Quillen FOUNDER, CEO

Agile Networks

K

le illen is a nationall recognized leader in the designing engineering and deplo ent of data infrastr ct re ai ed at econo ic develop ent and red cing costs for govern ent and siness s a ireless data net ork engineer he has n of ireless net orks and ackha l topolog e tensive e perience in the design i ple entation and operation illen is a reso rce to a ide range of partners e has led vario s organizations in creating the vision and e ec ting the deplo ent of data net orks and other co nication assets e is e perienced in p lic private partnerships ai ed at road and develop ent and data infrastr ct re ilding sing his e tensive kno ledge and involve ent in road and develop ent illen has een instr ental in delivering connectivit sol tions to re ote locations and aintaining a vision to contin e the e pansion of the net ork s capa ilities is specialties are ergers and ac isitions net ork design and integration graphical infor ation services ireless co nications and i a illen st died siness anage ent and infor ation technolog at ent State niversit rior to fo nding gile et orks he as chief technolog officer for ightspeed ireless

Hyland

A

s executive vice president and chief co ercial officer for land d c iston is dedicated to helping customers make the ost of land s nterprise nfor ation latfor and to leverage the f nctionalit the o n e also keeps the infor ed of ne and e erging technolog trends ith ore than ears e perience in the infor ational anage ent and advanced capt re ind stries c iston foc ses on colla orating land s glo al sales and arketing progra s and vertical-specific initiatives ith orld ide trends positioning land as the go-to vendor for infor ation anage ent sol tions c iston oined land in as the director of ealthcare Sol tions n he as pro oted to senior vice president of lo al Sales arketing aving served as vice president of glo al sales since he took on the responsi ilit of aligning arketing and sales in s pport of land s glo al e pansion n he as pro oted to e ec tive vice president and chief co ercial officer c iston earned his ndergrad ate degree in international politics fro enn State niversit e serves on the oard of directors for the ssociation for nfor ation and age anage ent

Congratulations DISTINGUISHED MARKETING AND SALES HONOREE

Christina Capadona-Schmitz

VP, Director, Marketing Communications

www.OswaldCompanies.com

S P O N O S O R E D

C O N T E N T

Congratulations Michelle Sustar Crain’s Cleveland Business is proud to congratulate integrated marketing manager Michelle Sustar and the rest of the 2018 Distinguished Marketing and Sales Award recipients!

CONTENT PRESENTED BY: S8 February 12, 2018

Joshua D. Studzinski

Michelle Sustar

University Hospitals of Cleveland

Crain’s Cleveland Business

INTEGRATED MARKETING MANAGER

DIRECTOR, SPONSORSHIPS AND SPECIAL EVENTS

A

s director of sponsorships and special events, Joshua Studzinski leads the sponsorships and activations for University Hospitals of Cleveland, along with many of the organization’s large signature events, from building openings to major celebrations.

Studzinski’s main role is working with the Cleveland Browns on all aspects of the UH partnership. He is a thirdgeneration Browns’ season ticket holder — his grandfather has held tickets since 1946. His signature moments involved leading the opening galas and events for the UH Ahuja Medical Center, UH Seidman Cancer Center, NICU (Neonatal Intensive Care Unit), Center for Emergency Medicine and the hospital system’s 150th anniversary.

He earned an undergraduate degree in sports management from the University of Dayton. Studzinski is skilled in nonprofit organizations dgeting event anage ent and vol nteer anage ent He lives in Hudson with his wife, Colleen, son Brady and daughter Madison. Studzinski coaches his children’s sports teams, golfs, travels and is an avid supporter of Cleveland’s sports teams.

M

ichelle Sustar began her career with Crain’s Cleveland Business in 2012 as a marketing and sales assistant, quickly moving up to marketing strategist before assuming her current position as integrated marketing manager in 2015.

Sustar handles all aspects of marketing, working closely with the events department and sales team. She completed Leadership Cleveland’s OnBoard Cleveland program in 2015, which sparked her interest in the community and philanthropy.

She is a member of the Wigs for Kids board of directors, Business Volunteers Unlimited YP Ambassadors and community relations committee and the Sales & Marketing Executives Cleveland associate board.

Focused on young professional expansion in Cleveland, Sustar in 2016 establish Crain’s RISE, a Northeast Ohio young professional advisory board.

She also founded and continues to facilitate the Young Professionals blog on www.CrainsCleveland.com, and she leads the Crain Cares volunteer program in the leveland office n she received a leveland rofessional l nder overs Shakers ard Sustar earned her undergraduate degree in public relations from Ohio University and studied fashion marketing at LIM College in New York.

Laura Szarek

DIRECTOR OF DIGITAL MARKETING

Vitamix

L

aura Szarek, director of digital marketing at Vitamix, has a passion for technology and marketing that enables her team to pursue innovation while acquiring leads, driving revenue and harvesting CONTINUED ON NEXT PAGE

Congratulations!

Congratulations to our very own Stephanie Hampson on being one of 2018’s Distinguished Marketing and Sales Award recipients.

Kyle Quillen on being honored with the 2018 DMSA! You are an incredible leader and extremely well-deserving.

Taking Care of Ohioans Since 1934

From your Agile Networks family.

MedMutual.com/Ohio2018

S P O N O S O R E D

C O N T E N T

CONTENT PRESENTED BY: February 12, 2018 S9

2017 FRED DISANTO, Ancora Advisors

CONTINUED FROM PREVIOUS PAGE

post-purchase engagement. She has been part of the company’s explosive growth for seven years.

Szarek leads the company’s vision, strategy, execution and optimizations for social media, email, sites, media, search and digital merchandising. She has 15 years’ experience in the industry, including time with media conglomerate Viacom. She managed digital marketing initiatives for several high-profile national brands, including Mars Inc., Rubbermaid and Reynolds Kitchens.

Szarek is proficient in digital marketing and engagement strategy, account management and planning, project management, and campaign/ promotion management.

She is a Bowling Green State University graduate and mother to Lucas and Alex. She is active as chair of Pediatric Hospital Crafts in the Bay Village Early Childhood PTA. She also is involved in Miracle Messages as a volunteer, bringing together the homeless and long-lost loved ones through digital video messages.

PAST BUSINESS

2016 DAVID GILBERT, Greater Cleveland Sports Commission & Destination Cleveland

EXECUTIVES OF THE YEAR

2015 DR. MARC GILLINOV, Cleveland Clinic 2014 BERNIE MORENO, The Collection Auto Group 2013 LEN KOMOROSKI, The Cleveland Cavaliers and Quicken Loans Arena

1982 WILLIAM E. MACDONALD, The Ohio Bell Telephone Co. 1981 RUBEN F. METTLER, TRW Inc. 1980 WILLIAM J. DE LANCEY, Republic Steel Corp.

1979 CLAUDE M. BLAIR, National City Bank 1978 FRANCIS A. COY, The May Co. 1977 CHARLES E. SPAHR, The Standard Oil Co. (Ohio)

2012 PAUL MATSEN, Cleveland Clinic

1997 ALEX MACHASKEE, The Plain Dealer

2011 JARED CHANEY, Medical Mutual of Ohio Family of Companies

1996 WILLIAM N. HULETT, Rock and Roll Hall of Fame and Museum

2010 JOSEPH M. SCAMINACE, OM Group, Inc (OMG)

1995 EDWARD BRANDON, National City Corp.

1974 SEMON E. KNUDSEN, White Motor Corp.

2009 TERRY STEWART, Rock and Roll Hall of Fame and Museum

1994 MARK H. MCCORMACK, International Management Group

1973 E.M. DE WINDT, The Eaton Corp.

2008 SANDY CUTLER, Eaton Corp.

1993 JOSEPH T. GORMAN, TRW Inc.

1971 FRANCIS A. COY, The May Co.

2006 GLENN RENWICK, The Progressive Corp.

1992 ROBERT GILLESPIE, Society Corp./ Society National Bank

1970 J.G. BELL, JESS A. BELL, Bonne Bell, Inc.

2005 CHRISTOPHER M. CONNOR, Sherwin-Williams

1991 MORTON L. MANDEL, Premier Industrial Corp.

2004 DAVID A. DABERKO, National City Corp.

1990 JAMES R. STOVER, Eaton Corp.

2003 K. MICHAEL BENZ, United Way Services

1989 JAMES M. BIGGAR, Nestle Enterprises, Inc./ The Stouffer Corp.

2007 TOBY COSGROVE, Cleveland Clinic

2002 KENT W. CLAPP, Medical Mutual Ohio

1976 THOMAS VAIL, The Plain Dealer 1975 HERBERT E. STRAWBRIDGE, The Higbee Co.

1972 G.J. TANKERSLEY, The East Ohio Gas Co.

1969 HON. CARL B. STOKES, City of Cleveland 1968 GEORGE J. GRABNER, The Weatherhead Co. 1967 RALPH M. BESSE, Cleveland Electric Illuminating Co. 1966 JAMES J. NANCE, Central National Bank of Cleveland

2001 WILLIAM B. SUMMERS JR., McDonald Investments, Inc., A KeyCorp Co.

1988 ROBERT B. HORTON, BP America, Inc. 1987 J. RICHARD KELSO, The East Ohio Gas Co.

2000 RICHARD W. POGUE, Dix & Eaton

1965 RANDALL M. RUHLMAN, Cleveland Chamber of Commerce

1986 JOHN G. BREEN, The Sherwin-Williams Co.

1999 FARAH M. WALTERS, University Hospitals Health Systems

1964 LOUIS B. SELTZER, The Cleveland Press

1985 ROY H. HOLDT, White Consolidated Industries, Inc.

1998 IRVING I. STONE/ MORRY WEISS, American Greetings, Corp.

1984 ARTHUR B. MODELL, Cleveland Browns Football 1983 M. BROCK WEIR, Ameritrust Corp.

1963 HAROLD T. CLARK, Leonard C. Hanna Jr. Fund 1962 ELMER L. LINDSETH, Cleveland Electric Illuminating Co.

Congratulations, Michelle Gandolf.

2018 Distinguished Marketing and Sales Award Recipient Michelle Gandolf

Director, Market Research and Analytics Cleveland Clinic

Same-day appointments

216.444.CARE

clevelandclinic.org

S P O N O S O R E D

C O N T E N T

PA G E 2 4

|

F E B R U A RY 12 - 18 , 2 018 |

CRAIN’S CLEVELAND BUSINESS

THE LIST

Largest Philanthropic Gifts of 2017 Ranked by Gift Amount THIS YEAR RECIPIENT

CONNECTION TO RECIPIENT

DONOR

GIFT AMOUNT (1)

2017 GIFT DATE

WHAT WILL THIS GIFT SUPPORT?

JumpStart Inc.

KeyBank Foundation

$24,000,000 (2)

July 31

KeyBank Business Boost & Build program for small businesses in Ohio and upstate New York

Foundation donor

Kara Carter (216) 363-3400

Cleveland Clinic

Anonymous

$23,000,000

May 1

Liver transplant research

Grateful patients

Lara Kalafatis (216) 445-8695

Case Western Reserve University

Bob and Brenda Aiken

$20,000,000

March and April

The Aiken Strategic Initiative in education and research in the Department of Biomedical Engineering

Graduate (Bob Aiken)

Lawrence Gibson (216) 368-4352

3

University of Akron

Estate of Jean Hower Taber

$20,000,000

October

Hower House and scholarships

Honorary alumna

Kimberly Cole (330) 972-7608

5

The Musical Arts Association

Richard and Emily Smucker Family Foundation

$15,000,000

July

Various programs

Board president (Richard Smucker)

Abby Mitchell (216) 231-7520

6

Cleveland Clinic

Anonymous

$14,000,000

April 3

Image-guided surgery and research

Grateful patient

Lara Kalafatis (216) 445-8695

7

Cleveland Foundation

Anonymous

$10,157,730

Dec. 21

Donor advised fund

Donor

Kaye Ridolfi (216) 861-3810

Playhouse Square Foundation

KeyBank

$10,000,000

June 17

Ticket and transportation subsidy for Cleveland Metropolitan School District field trips to Playhouse Square

Longtime donor

Michelle Ryan Stewart (216) 640-8410

Cleveland Clinic

Timken Foundation

$10,000,000

March 3

Cole Eye Institute expansion

Foundation donor

Lara Kalafatis (216) 445-8695

10

The Musical Arts Association

Estate of Jean Taber

$9,000,000

August

Endowment, pension fund

Patron

Elizabeth Arnett (216) 231-7522

11

Akron Art Museum

John S. and James L. Knight Foundation

$8,000,000

Sept. 28 (announced)

Expand programming and add to art collection

Foundation donor

NA

Case Western Reserve University

Anonymous

$7,000,000 (3)

November

Strategic initiatives in education and research at the Case School of Engineering

Graduate

Lawrence Gibson (216) 368-4352

13

University Hospitals

Sara and Chris Connor

$6,500,000

Dec.18

Connor Integrative Health Network

Friend

Sherri Bishop (216) 983-2200

14

Cleveland Foundation

Charles W. Wason Trust

$6,319,279

Sept. 28

The Charles W. Wason Fund, to support Cornell University

Friend

Kaye Ridolfi (216) 861-3810

15

Cleveland Clinic

Anonymous

$5,000,000

Jan. 1

Miller Family Heart & Vascular Institute

Grateful patient

Lara Kalafatis (216) 445-8695

15

University Hospitals

Anonymous

$5,000,000

May 31

University Hospitals

Friend

Sherri Bishop (216) 983-2200

15

Cleveland Clinic

Anonymous

$5,000,000

June 1

Cleveland Clinic, through Cosgrove Transformation Campaign

Grateful patient, trustee

Lara Kalafatis (216) 445-8695

15

Case Western Reserve University

Anonymous

$5,000,000

September

Education and research at the Case School of Engineering

Graduate

Lawrence Gibson (216) 368-4352

15

Summa Health

Gary B. and Pamela S. Williams

$5,000,000

Oct. 20

Center for Breast Health (including naming rights)

Longtime physician (Gary Williams)

Phylis Ferrara (330) 375-3159

15

University of Akron

Jim and Vanita Oelschlager

$5,000,000

March

Oak Native American Museum, part of the Institute for Human Science and Culture

Honorary alumni

Kimberly Cole (330) 972-7608

21

Cleveland Clinic

Anonymous

$4,000,000

June 1

Miller Family Heart & Vascular Institute

Grateful patient, trustee

Lara Kalafatis (216) 445-8695

22

Cleveland Foundation

Anonymous

$3,599,987

Dec. 20

Several donor advised funds

Donor

Kaye Ridolfi (216) 861-3810

23

Cleveland Clinic

Anonymous

$3,300,000

Dec. 7

Taussig Cancer Institute, Cosgrove Transformation Campaign

Volunteer leaders

Lara Kalafatis (216) 445-8695

24

Cleveland Foundation

Anonymous

$3,009,181

Dec. 14

Supporting organization

Donor

Kaye Ridolfi (216) 861-3810

25

Kent State University

Aramark Global Business Services

$3,000,000

June 6

Kent State of Wellness program fund and director

Vendor

Leigh Greenfelder (330) 672-7108

25

University of Akron

Ernest and Marianna Grotefend Estate

$3,000,000 (4)

Aug. 28

Scholarships in the Department of Mechanical Engineering

Graduate (Ernest Grotefend)

Kimberly Cole (330) 972-7608

25

John Carroll University

John and Mary Ann Mastrantoni

$3,000,000

June 7

Scholarship, Magis Learning Commons

Graduate (John Mastrantoni)

Doreen Riley (800) 736-2586

25

Cleveland Clinic

Jones Day Foundation

$3,000,000

Nov. 21

Cleveland Clinic Children's expansion, Cosgrove Transformation Campaign

Foundation donor

Lara Kalafatis (216) 445-8695

25

City of Youngstown

Youngstown Foundation

$3,000,000

NA

Construction of new amphitheater

Foundation donor

NA

30

Cleveland Foundation

Anonymous

$2,998,913

Dec. 19

Donor advised fund

Donor

Kaye Ridolfi (216) 861-3810

1 2 3

8 8

12

DEVELOPMENT CONTACT

RESEARCHED BY CHUCK SODER (CSODER@CRAIN.COM)

Want the full Excel version of this list Ă‘ and every Crain's list? Become a Data Member: CrainsCleveland.com/data The full list includes 76 gifts. Donations to religious organizations are not included. Information is from gift recipients and Crain's research. Crain's does not independently verify the information and there is no guarantee these listings are complete or accurate. Have questions, suggestions or corrections? Contact Chuck Soder: csoder@crain.com.

(1) Gift dollar figures in some cases include commitments to make future donations. (2) To be awarded over four years (3) Donor has now given a total of $18 million to this purpose. (4) First installment of $1.5 million received on

Aug. 28

CRAIN’S CLEVELAND BUSINESS

|

F E B R U A RY 12 - 18 , 2 018

|

PA G E 2 5

ANALYSIS

List: 2017 a big year for big donations

By CHUCK SODER

Gifts over $2 million

csoder@crain.com @ChuckSoder

The number of $2 million gifts nearly doubled in 2017. A look at the last four years:

Local nonprofits received 60 gifts worth more than $2 million in 2017, the highest number that we’ve recorded since we started compiling our Largest Philanthropic Gifts list in 2012.

The total dollar figure nearly set a record, too: Those 60 gifts were worth $310.7 million — just barely short of the 2015 record (49 gifts worth $311.6 million). But the 2017 total is waaaay higher than the figure from 2016: $170.3 million.

While compiling the 2016 data for last year’s list, I only found 31 gifts of $2 million or more — barely enough to fill the print version of the list.

Fearing that I wouldn’t have enough gifts this year, I lowered the bar to $1.5 million. Using that lower threshold, I found 74 gifts worth $337.9 million. All of them appear in the digital version of the list.

Of course, the numbers could drop again next year: They vary pretty widely from year to year. Why? Well, if a large organization goes on a major fundraising campaign, that could drive the numbers up one year. And if that organization decides not to submit gifts for the list the following year, that will drive the numbers down.

And one or two particularly large gifts can drastically skew the total dollar figure — but that didn’t happen on this year’s list. JumpStart, a nonprofit that works with local entrepreneurs,

Cleveland is a city where generosity runs deep.

United Way of Greater Cleveland

2017: 60 gifts totaling $310.7 million

thanks the more than 70,000

2016: 31 gifts totaling $170.3 million 2015: 49 gifts totaling $311.6 million

Clevelanders who have contributed toward

2014: 55 gifts totaling $241.9 million

received the largest gift: a $24 million grant from the KeyBank Foundation.

A big gift for sure, but not unusually large judging by past lists.

As per usual, the list is dominated by the Cleveland Clinic and Case Western Reserve University. The Clinic received 19 qualifying gifts worth $90.2 million, including a $23 million anonymous gift for liver research (No. 2 on the list) and two other gifts exceeding $10 million. Case received 13 gifts worth $53 million, including a $20 million gift tied for No. 3, from Bob and Brenda Aiken.

The University of Akron had a particularly strong showing this year, receiving three gift commitments worth $28 million (including the other gift in the No. 3 spot, from the estate of Jean Hower Taber). Some gifts on the list represent commitments to make future donations.

Three other nonprofits received gifts exceeding $10 million: The Musical Arts Association (which runs the Cleveland Orchestra), the Cleveland Foundation and Playhouse Square. None of those organizations had gifts included on last year’s list.

making our city a better and “greater” place to call home.

Visit unitedwaycleveland.org for more information.

Together, we’re greater.

NOMINATIONS OPEN FOR 2018 Crain’s Cleveland Business’ award and recognition programs honor those throughout the Northeast Ohio community who are excelling and thriving in their industry.

CrainsCleveland.com/Nominations

CRAIN'S CLEVELAND BUSINESS

CLASSIFIED

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

PROFESSIONAL SERVICES

BUSINESS SERVICES

μ

FEBRUARY 12, 2018

μ

PAGE 25

REAL ESTATE

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

All Ads Pre-Paid: Check or Credit Card

AUCTIONS

AUCTION - FEB. 22

University Circle United Methodist Church Orders Immediate Sale!

52,000 SF ICONIC ARCHITECTURAL MASTERPIECE ON 1± ACRE, DOWNTOWN CLE

Located on 1± acre adjacent to the Cleveland State University Campus, this former Church/School property offers a variety of possible uses including religious, school, residential conversion, restaurant/bar, entertainment venue, etc.

24,000 SF Church/Sanctuary on 2 floors and 28,000 SF school on 4 floors (including lower level). The property also features fenced/gated parking with entrances on East 30th Street and Prospect Ave., full kitchen & cafeteria, located in the heart of Midtown and access to RTA’s Healthline immediately in front of the property.

FLYNN ENVIRONMENTAL UST REMOVALS - REMEDIATION DUE DILIGENCE INVESTIGATIONS

FINAL ON-SITE INSPECTION DATE!

(800) 690-9409

BUSINESSES FOR SALE Lucrative Machine Business for Sale ~ Elyria, Ohio

FOR SALE 48"x 40" PALLETS EXPORT GRADE NEW! AS LOW AS $7.00 330.539.5433 WWW.LITCO.COM

Place an Executive Recruiter ad in Crain’s

μ Over $220K in machines, solid customer base μ 14 years in business μ Excellent investment opportunity! μ Employees can possibly work for new owner.

Call 216-771-5276

CALL ~ 440-284-0711

Looking to fill a position on your staff?

3000 Euclid Avenue, Cleveland, OH 44115

THURSDAY, FEBRUARY 15TH - 10:00 A.M. TO 12:00 NOON

OFFERED WITH A PUBLISHED RESERVE PRICE OF ONLY $250,000!

FOR ADDITIONAL INFORMATION, BROCHURE & TE RMS, C ALL:

CHART WELLAUC TIONS.COM

List your commercial, executive property, industrial or retail space here!

Crain’s Cleveland Business’classifieds will help you fill that space.

Call 216-771-5276

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

216.861.7200

HANNA COMMERCIAL • CHARTWELL REAL ESTATE AUCTIONS • TCN WORLDWIDE MARK ABOOD, OH RE SALESPERSON • MICHAEL BERLAND AARE, OH AUCTIONEER

OFFICE SPACE Lab & Office Space for Lease, excellent location.

Please call Peter Miller from Lee & Associates at 216-357-9020

PA G E 2 6

|

F E B R U A RY 12 - 18 , 2 018 |

CRAIN’S CLEVELAND BUSINESS

ADVERTISING SECTION

MBA

WEATHERHEAD SCHOOL OF MANAGEMENT

www.crainscleveland.com/onthemove

To place your listing or for more information, please call Lynn Calcaterra at (216) 771-5276 or email lcalcaterra@crain.com

weatherhead.case.edu

ACCOUNTING

ACCOUNTING

HEALTH CARE

Brett Johnson

Ken Belton

Business Development Director

Vice President of Franchise Operations

RSM US LLP Brett Johnson has joined RSM as business developer. He has experience working in corporate finance, capital markets, private equity and wholesale distribution industries. In the past Brett helped secure relationships with a significant number of Fortune 2000 and middle-market organizations across most major industries. Brett will continue to work closely with key private equity clients and prospects in Ohio and other select markets as well as prospect for new clients to the firm.

HealthSource Ken Belton joins HealthSource as Vice President of Franchise Operations. Belton brings more than two decades of retail experience, working on such brands as T-Mobile, Borders and Blockbuster. He was also Director of Field Operations for Mosaic Sales Solutions, where he was responsible for sales training and merchandising for Microsoft at more than 5000 retail locations across the country. Most recently Belton worked in field operations for The Joint Chiropractic.

Zachary A. Schweda

Michael C. Bigrigg

Partner

Senior Manager

Bober Markey Fedorovich

Bober Markey Fedorovich

Schweda consults extensively with corporate clients, external auditors, and attorneys on valuation topics within a wide range of industries. He provides independent third-party valuation consulting services across a broad range of asset classes to support clients’ financial reporting and tax reporting endeavors as well as providing expertise within litigious contexts. Previously, Zak served as Managing Director of the former Gabriel Partners Valuation & Corporate Services Practice.

Bigrigg assists law firms, corporations, lenders, and public institutions with analysis, understanding, and resolution of complex financial issues.

He provides independent valuation services for a variety of needs, including M&A, financial reporting, tax reporting, exit planning, shareholder disputes & other litigious matters. His work regularly withstands scrutiny from the SEC, IRS, external audit reviews, and other triers of fact. He previously served with Gabriel Partners Valuation Practice.

FINANCE

FINANCE

FINANCE

FINANCE

Jeffrey Bechtel

Richard Goss

Kurt Kappa

Kurt Raicevich

Executive Vice President, Chief Operating Officer

Senior Vice President, Commercial Real Estate and Loan Operations

Senior Vice President, Chief Lending Officer

Senior Vice President, Retail Banking

First Federal Lakewood

First Federal Lakewood

EDUCATION Brenda Spear President, Cleveland campus

Chamberlain University College of Nursing In her new role, Spear will oversee all aspects of the nursing program at the Cleveland campus including overall academic excellence, student services and support, operational efficiency, and student success. Since joining Chamberlain University in 2014, Spear has served as assistant professor and most recently, dean of academic affairs.

Spear began her career in healthcare as a staff nurse at the Cleveland Clinic Foundation and worked as a nurse for more than 16 years.

First Federal Lakewood Jeffrey Bechtel assumes the newly created role of Executive Vice President, Chief Operating Officer of First Federal Lakewood. Jeff holds responsibility for the business, retail, consumer and residential lending divisions of the bank, including sales and operational teams. Jeff has more than 25 years of financial services experience, including five with First Federal Lakewood serving in executive roles.

First Federal Lakewood Richard “Rig” Goss assumes the newly created role of Senior Vice President, Commercial Real Estate and Loan Operations at First Federal Lakewood. Rig has more than 25 years of experience in commercial real estate lending, including 9 years with First Federal Lakewood. Rig continues to manage the Commercial Real Estate (CRE) team, with the added responsibility of overseeing Commercial Loan and Credit administration.

TECHNOLOGY

Kurt Kappa joins First Federal Lakewood as Senior Vice President and Chief Lending Officer, managing the commercial and industrial and treasury management teams. Kurt will focus his efforts on further developing relationships with businesses throughout Northeast Ohio. He previously was a Senior Vice President and Market Leader at Westfield Bank.

HEALTH CARE Kieran McCauley Vice President of Marketing

HealthSource HealthSource is pleased to announce the addition of Kieran McCauley as Vice President of Marketing. McCauley has earned a reputation for creating bold advertising campaigns, working on a long list of consumer and Fortune 500 brands, including White Castle, Hotels.com, Sherwin-Williams, Volvo and BP. He comes to HealthSource from Marco’s Pizza, the country’s fastest growing pizza concept.

Kurt Raicevich assumes the role of Senior Vice President, Retail Banking at First Federal Lakewood. In this role, Kurt oversees all aspects of the retail banking division. He was previously Vice President, Retail Sales Manager at First Federal Lakewood, a position he held since 2014. Kurt has more than 25 years of experience in the financial services industry, including several commercial and retail executive roles.

KNOW SOMEONE ON THE MOVE?

Tony Guidi Senior Vice President of Emerging Markets

Blue Chip Consulting Group In 2018, Blue Chip Consulting Group will focus on the development of Central and Southeast United States, with plans to hire at least 40 IT professionals across those regions. Guidi will lead the strategy and execution of growth opportunities for Blue Chip, helping the company expand into new markets in order to fill gaps in holistic IT consulting. He brings extensive IT experience, 25 years of consulting leadership, and a successful track record of growing new markets to his new role.

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

SIGN UP FOR ONE OF OUR INDUSTRY NEWSLETTERS www.crainscleveland.com/newsletters

Sports Business -- Real Estate -- Health Care -- Manufacturing -- Small Business -People on the Move -- Middle Market

CRAIN’S CLEVELAND BUSINESS

Source Lunch

|

F E B R U A RY 12 - 18 , 2 018

|

PA G E 2 7

Mark Masuoka

Executive director, Akron Art Museum Mark Masuoka is in an enviable position — kind of like a fisherman who has been put in charge of the area’s best lake.

He’s not only the executive director of one of the region’s cutting-edge art museums — Akron’s — but the building is one of the region’s architectural gems, the first U.S. museum designed by the renowned firm Coop Himmelblau. What’s more, Masuoka got to town just in time to help participate in, and lead, the city’s resurgence of art appreciation and participation. ¶ Plus, he gets to be surrounded by what he loves all day — art, especially contemporary art. ¶ Masuoka took the reins of the museum in 2013. Since then, he has been working the doors to push art out into the community and to bring more Akronites inside. That has meant outdoor installations replicating some of the museum’s more noteworthy pieces in some of the city’s most-traveled public spaces — an ongoing series of installations the museum has dubbed “Inside|Out.” ¶ To get more people in the doors, he has done more than build the museum’s collection and bring to town exciting new exhibits. He’s also built the museum’s membership to unheard-of levels with new initiatives and a huge promotion last year. ¶ Yeah, Masuoka is having a good time. But so apparently are a lot of the city’s art lovers, thanks to his work. — Dan Shingler

Five (artsy) things Gotta ask — what’s your favorite color?

Ha. Black. It always has been, too.

Besides your own, what’s your favorite museum?

The Met. And one most people might not think of: the Des Moines Art Center

And your favorite piece in the Akron museum, if you’re allowed to even …

Gene Davis’ (painting) Sky Hook. … The first time I saw it, I asked for a chair.

Favorite thing to acquire for the museum?

Sculpture by Viola Frey

Who's an artist you wish you’d met?

I would like to have met (American painter and a Cleveland Institute of Art graduate) Charles Burchfield.

Tell us a little bit about yourself.

How old are you?

I’m 57.

You don’t look it. Got a secret?

Oh, I’m old, but I’m Asian and I’m short. That plays a little bit of a role in that.

Did you expect this?

Before we did the campaign, we were targeting 2,000 members, and we would have been happy with that.

We had never been at 2,000 members before. The fact that we blew so far past it causes us to stop and think.

And where did you grow up?

Hawaii. … My dad was third generation and my mom was second, so both of their parents were born in Hawaii. …

My parents were there during the war (World War II), but they were kids.

This tells you what about your audience?

They’re appreciative and they’re excited. … We also had about 400 existing members upgrade their memberships that day.

It must’ve been difficult for them being Japanese on Hawaii during World War II. Actually, so much of the population and the workforce was Japanese that, unlike in the U.S. where many of the Japanese were interned, they couldn’t do that in Hawaii. It would shut down.

How is corporate support?

Things are starting to improve, and I think the contributions are becoming more robust, but we still have a lot of work to do. ... Corporate support has been one of the last things to come back after the recession.

OK, 57, Hawaii … did you know Barack Obama?

No. … I grew up in the same proximity.

My cousins went to school with him.

But when he lived there, I don’t think he was very notable, to be honest. …

That came later.

You took over the museum in 2013, and you had a little over 1,600 members just last year.

How about today?

Over 18,000. Crazy, huh?

Lunch spot Diamond Grille 77 West Market Street, Akron

The meal Each had the Friday special, fish and chips, with an iced tea.

The vibe A classy steak place, known as the city’s best and has been since it opened in 1941. We saw some jeans on a casual afternoon, but the food, service and ambiance were as well-suited as ever.

The bill $45 with tip

Today, you’re in management, but you began as an artist?

I did ceramics — not pottery, sculpture. … But I always had this extreme interest in business, the administrative side and things behind the scenes.

Ever run a for-profit?

When I was 29, I opened my first art gallery in Las Vegas. People said, “What you doing in Vegas?,” but in the 1990s, Vegas was hot.

How much does a membership usually cost?

Fifty bucks. … But that’s a lot of money to some people, including some artists.

How did you come to run museums?

I sold the gallery with the idea I would do another startup that was art related, but I had clients who were also patrons of the local contemporary art museum and they were searching for a new director. Up until that point, though, I had never even conceived of running a nonprofit. But once I talked to them, I saw a lot of parallels with what I was doing.

Some of those people are from outside Akron, but your membership equals about 10% of the population?

Yeah, about 10%. … Our old numbers were actually somewhat comparable with similar organizations in cities of similar size. … This is kind of unheard of.

What was the first thing that impressed you about the museum here before you joined?

The building itself — it’s amazing that it’s here in Akron. ... I was pretty impressed by the fact that a community the size of Akron had decided to build it!

The story behind that?

In November, we changed it from “Giving Back Tuesday” to us giving away free one-year memberships. …

We got 16,000 members in one day.

700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113 Phone: 216-522-1383; www.crainscleveland.com Reprints: Laura Picariello ; (732) 723-0569 Customer service and subscriptions: 877-824-9373

Volume 39, Number 7 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly at 700 West St. Clair Ave., Suite 310, Cleveland, OH 441131230. Copyright © 2018 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.

Subscriptions: In Ohio: 1 year - $64, 2 year - $110. Outside Ohio: 1 year - $110, 2 year - $195. Single copy, $2.00. Allow 4 weeks for change of address. For subscription information and delivery concerns send correspondence to Audience Development Department, Crain’s Cleveland Business, 1155 Gratiot Avenue, Detroit, Michigan, 48207-9911, or email to customerservice@ crainscleveland.com, or call 877-824-9373 (in the U.S. and Canada) or (313) 446-0450 (all other locations), or fax 313-446-6777.

T:10.875” S:10.25”

MORE OF WHAT YOUR

BUSINESS NEEDS

THAN YOU THOUGHT

YOU’D SPEND

AT&T INTERNET FOR BUSINESS

40

$

100 MBPS / MONTH

WHEN BUNDLED

Why trust anyone else? Switch to AT&T Internet for Business now at a lower price.

Go to att.com/ATTSwitcher8 or call 1-855-288-5565.

That’s the Power of &.

AT&T Internet for Business Promotion: Offer expires 3/31/2018. 24-month promotional rate is $40/month for 100x20Mbps Dynamic IP service, based on designated market area. After 24 months, the then-current published rates will apply and prices will be subject to change. Customer must have or purchase a qualifying AT&T voice service. Up to a $99 equipment installation charge is extra. Prices do not include applicable taxes, surcharges and fees. Acceptance of AT&T Internet Terms of Service at www.att.com/internet-terms is required. Geographic and service restrictions apply. Internet speed claims represent maximum network Service Capability speeds; actual customer speeds are not guaranteed and may vary based on factors including site traffic, content provider server capacity, internal network management, device capabilities and use of other services. ©2018 AT&T Intellectual Property. All rights reserved. All marks used herein are the property of their respective owners.

S:14”

LESS

T:14.5”

&