Crain's Cleveland Business, February 3, 2025

HOSPITAL HACKS RISING

By Paige Bennett

Cybersecurity remains a top concern for Northeast Ohio’s health systems after several high-pro le cyberattacks disrupted services at some of the country’s largest health care providers last year.

Information technology leaders at

Cleveland Clinic, University Hospitals, and MetroHealth said that ransomware attacks are becoming more common and sophisticated thanks to arti cial intelligence. Cyber incidents can have devastating consequences for health systems, hindering providers’ access to critical patient information and putting sensitive data at risk.

Arguably the biggest cybersecurity threat facing health systems is the increase in ransomware attacks against third-party vendors.

Change Healthcare, a payment processing provider used by many health systems in the U.S., experienced a massive ransomware attack last February that compromised the data of an esti-

Marriott-branded era takes shape for Erieview Tower

By Dan Shingler

Work on the redevelopment of Erieview Tower has begun, and backers say that while the project’s January nancing came in a little later than expected, they still hope to see it completed next year.

“Our target right now is to complete it before the holidays in ‘26,” said Jon Pinney, managing partner at the KJK law rm working on the project. Pinney is also managing director of TurnDev, the Beachwood development rm that is managing the project alongside the Kassouf family, which owns the building, and their Kassouf Development company.

Independence Construction is the project’s general contractor and Beyer Blinder Belle, a New York rm favored by Marriott, is doing the architectural work, Pinney said.

Turner & Townsend, also of New York, will be the project’s construction manager, while Rockwell International, along with Marriott, will do its interior design, said Anthony Delfre, managing director of Brown Gibbons Lang, a Cleveland investment bank. Delfre is working on the Erieview project as a longtime nancial adviser for the Kassouf family.

See ERIEVIEW on Page 16

SPORTS

Browns unveil plans for ‘The Barker Hotel’ at Berea campus.

For Northeast Ohio’s health systems, ransomware threats intensify

mated 100 million patients. e incident caused weeks of disruption across the health care sector, with providers unable to process claims or receive payments. is added nancial strain to an industry already dealing with tight margins.

See HOSPITAL on Page 16

Neighborhood organizations could see funding overhaul

By Kim Palmer

A council member-sponsored ordinance designed to overhaul the funding model for Cleveland’s Community Development Corporations (CDCs) was read into the record and introduced at the City Council meeting on Monday, Jan. 27. e legislation’s goal — which has been at the heart of ongoing discussions between the council, City Hall and the CDCs — is to address the ine ciencies of small neighborhood organizations’ current reliance on restrictive, cumbersome Community Development Block Grant (CDBG) funds as their main source of revenue.

“ is is the most signi cant change to funding of our neighborhood organizations in 30-plus years,” says Tania Menesse, executive director of Cleveland Neighborhood Progress (CNP). “I think, across the board, people realize that the current system does not work.”

Councilman Kerry McCormack, who represents downtown and parts of Ohio City, sponsored the measure which would swap out about $8.6 million in CDBG dollars — from two types of funds — for the same amount of earmarked city general fund dollars.

See FUNDING on Page 17

Cleveland Clinic

CEO details outlook as system faces industry headwinds and job losses. PAGE 9

Browns unveil plans for hotel at Berea campus

By Joe Scalzo

Dawg Pounders will soon have a new place to sit, stay and lay down.

The Haslam Sports Group — owners of the Cleveland Browns — and Independence-based developer DiGeronimo Companies are expected to break ground later this year on “The Barker Hotel,” a five-story Tribute Portfolio hotel at the recently announced District 46 at CrossCountry Mortgage Campus in Berea.

The Tribute, which is a Marriott international lifestyle brand, is expected to open in 2027. The hotel is designed by Meyers + Associates and will include more than 96,000 square feet, a bar and restaurant, a fitness center, meeting space and more.

HSG and DiGeronimo partnered with real estate developer Crawford Hoying and international hotel owner, operator and developer Shaner Hotel Group on the project.

“Adding The Barker Hotel as part of District 46 at CrossCountry

Mortgage Campus will not only help continue to grow Berea and the surrounding areas, but also provide fans with an ideal place to stay right in the backyard of our

facility," Haslam Sports Group COO David Jenkins said in a news release. “We look forward to working with DiGeronimo Companies, Crawford Hoying, and Shaner Ho-

tel Group and Marriott on this project to help complete the neighborhood, which is already bringing a variety of spaces to benefit the region.”

District 46 is a 16-acre extension of the team’s footprint slated to open in early 2027 and include community, medical, multifamily living and commercial spaces. The $150 million, privately funded project will also include a multisport community field for all ages; a sports medicine facility operated by University Hospitals; marketrate apartments; a communityuse field house; a parking garage, and 30,000 square feet of retail space.

“Anchoring the development with a hotel of the caliber of The Barker is consistent with our vision for District 46,” said DiGeronimo Companies CEO Vic DiGeronimo Jr. “We thank Haslam Sports Group, Crawford Hoying, Shaner, and Marriott for their partnership in bringing this unique hotel offering to Berea.”

The development is the 16th collaborative hotel venture for Crawford Hoying and Shaner, which includes AC Hotels in Dublin, Ohio, and Dayton, as well as the newly opened Hotel Celare in Cincinnati.

K&D signs new tenants for downtown office space

By Dan Shingler

K&D Group has recently found success leasing downtown office space, with significant new tenants taking space in two buildings the real estate investment and management group has renovated.

Most recently, Willoughby-based K&D announced it signed a 10year lease for Junior Achievement of Greater Cleveland to occupy the ground floor of the 668 Building (also known as The Residences at 668), near East Sixth Street on Euclid Avenue.

Junior Achievement will occupy 10,900 square feet on the Prospect Avenue side of the building, K&D said in announcing its new tenant.

Matt Driggs, vice president of commercial real estate for K&D, said Junior Achievement will move in this fall once the space is built out to meet its needs. The space was most recently occupied by the fitness facility Fitworks before it closed its downtown location.

Junior Achievement President Al DiFranco said the new location will give Junior Achievement significantly more space than its current location in the Hanna Building at Playhouse Square, where it leased about 2,500 square feet.

The bigger space will enable the organization, which normally teaches students about business and entrepreneurship onsite at area schools, to bring some of its classes and events inhouse.

“We serve about 20,000 students annually," DiFranco said. "We usually do that at the schools, and this will give us the opportunity to do it at our

facility as well."

Junior Achievement considered more than twenty locations before signing its lease at the 668 Building. DiFranco said the building was attractive because of its location, amenities, and condition, including recently redone common areas that Junior Achievement plans to use.

The organization's nine employees wanted to stay downtown, which is a central location for the nonprofit serving students in Cuyahoga, Geauga, Lake and Lorain counties, DiFranco said.

“There’s a lot of space avail-

able,” DiFranco said. “This is a central location to our corporate community partners and provides ease of access to young people coming to our space.”

Public Square

In December, K&D signed another significant lease, this one with the law firm Sutter O’Connell, which is taking 10,592 square feet at K&D’s 55 Public Square building. That building is a mix of apartments and office space.

Both the 668 Building and 55 Public Square are recent acquisitions for K&D, which spent tens of millions of dollars on renovations. There will be only one space left in the 55 building after O’Connell moves in.

K&D bought 55 in 2021 for $17 million. The developer spent more than $80 million turning it into a gleaming mixed-use development. It has just over 200 apartments on its lower floors and seven floors of office space up top.

The 668 Building was an older purchase that K&D has now invested in twice since purchasing it.

“We originally did the historic renovation of 668 in 2008, but just in the last year we updated the common areas of the property with a brand-new conference center, brand-new fitness room, and brand-new community lounge,” Driggs said. “I believe that all three of these things, while not necessarily the driving forces, certainly helped make Junior Achievement’s decision to sign a lease with us that much easier.”

District 46 at CrossCountry Mortgage Campus will include a five-story Marriott Tribute Portfolio hotel called “The Barker.” | AODK ARCHITECTURE

Hopkins Airport exceeds 10M passengers in 2024

Total is just shy of the initial forecast and a 3% increase over 2023

By Kim Palmer

More than 10 million people traveled to, from or through Cleveland Hopkins International Airport (CLE) last year, the first time the airport has crossed that threshold since 2019.

The 10,173,861 visitor total, released Tuesday, Jan. 28, was 99.3% of the initial 2024 forecast of 10,250,000. Still, it represents a 3% increase over 2023.

Additionally, airport officials reported just over 806,000 passengers came through Hopkins in December 2024, a slight uptick (0.055%) over December 2023. That number also reversed the

year-over-year decline the airport saw in November.

“Although we fell a bit short of our initial forecast, 2024 was a busy year and we fared very well overall,” airport director Bryant Francis said in a statement.

The airline industry experienced a relatively volatile year, which contributed in part to Hopkins’ near miss of the 2024 forecast. Several factors, including two hurricanes and a multiday, major IT outage, affected flights nationwide at various points throughout the year.

Airline seat reductions also impacted those Hopkins totals.

Spirit Airlines saw a 66% market reduction in seats for the year, while United and American also saw seat capacity slip later in the year.

But 2024 had plenty of high

Olympic Steel names Brant Harbert as its new general manager

By Dan Shingler

Olympic Steel, a big Bedford Heights-based metals service center, has a new boss in town.

The company announced on Friday, Jan. 24, that Brant Harbert is its new general manager, replacing the recently promoted Kevin Miller.

In his new role, Harbert will be in charge of Olympic's facilities in Bedford Heights and Dover.

"In the decade Brant has been with Olympic Steel, he has had a significant impact on our growth in the region, and we’re proud to recognize his contributions to the Company and his continued advancement within the organization,” said David J. Gea, Olympic’s president for carbon flat rolled steel.

Gea said he expects Harbert

to oversee continued investment in the facility.

“Since we first opened the doors to our Cleveland facility, we have continued to invest in our Bedford Heights operation, most recently with the installation of several new lasers to support our fabrication market growth and a stacking and packaging line to increase throughput capacity,” Gea said in announcing the promotion. “We look forward to the continued strategic growth of this location under Brant’s leadership.”

Harbert earned both his bachelor’s degree in marketing and his master’s degree in business management from Walsh University in North Canton.

He was most recently an inside sales representative for the company, according to his LinkedIn profile.

points, including a record month in June, when the airport saw 987,508 passengers, a monthly total not hit since August 2008.

The airport's passenger forecast for 2025 is expected to increase to 10.4 million. The main driver is anticipated to be more seat capacity available from budget airlines, including Frontier Airlines, which established a local crew base and increased passenger activity by more than 32%.

Aer Lingus also will increase seat capacity at Hopkins. The Irish airline announced plans to increase the frequency of the Cleveland to Dublin route to as much as six times a week in spring 2025.

“Our business development efforts to increase flights and seats will continue in 2025, with several unserved routes being of primary focus,” Francis said in a statement.

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Ohio’s ‘legacy’ cities drive GDP, face growing population losses

By Kim Palmer

Despite shifts in the economy, Ohio’s “three Cs” — Cleveland, Cincinnati and Columbus — are still crucial to the state’s overall gross domestic production (GDP), according to findings from a Greater Ohio Policy Center report.

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But there’s a looming problem. The essential role those cities (and some smaller urban centers) play in making Ohio the seventh-largest producer of GDP in the country is uniquely threatened by predictions of precipitous population declines over the next 25 years.

The short report “Ohio’s Legacy Places Matter a Lot” used U.S. Census and State Department of Development data to illustrate the dilemma Ohio faces by losing residents and workers in its most productive counties.

Estimates predict the state, currently responsible for 3% of the nation’s GDP, will lose nearly 6% of its population by 2050. The study found that those losses will be particularly acute because 59% of that production comes from counties that are expecting to see the most significant population decline over those 30 years.

“That contraction will not be felt equally around the state. Many legacy cities and their surrounding metros are expected to experience steady or declining population numbers, while only Central Ohio, Southwest Ohio and several ‘collar counties’ are expected to grow," according to the report.

The report comes as the federal government temporarily paused the dispersal of massive funding programs that target infrastructure, manufacturing, and technology investments in urban areas across the country.

The Pew Charitable Trusts estimates that the federal government gave about $1 trillion in grants to states in fiscal year 2022, according to the most recent year U.S. Census grants data available.

“That was a record high, representing 36.4% of states’ total revenue,” said Rebecca Thiess, manager at The Pew Charitable Trusts. “Federal grant funding helps states pay for public services, such as health care, education, transportation, and infrastructure.”

Thiess said that withdrawing all federal funding will strain most states, which were already facing tighter budgets than in recent years due to the expiration of federal pandemic aid and stagnating tax collections, among other challenges.

The three Cs are among the top 36 metro areas in the country for GDP production. Cincinnati is 29th with a $160 billion GDP in 2023, Columbus is ranked 34th with a $148 billion GDP, and Cleveland is ranked 36th with a $140 billion GDP in 2023.

The study found that Ohio’s GDP production growth is lagging behind the national average of 2.1% and has not increased as fast as that of states like Georgia, Washington and North Carolina. Buoyed by population increases, Washington state’s GDP will outpace Ohio’s, surpassing it in 2026. Georgia is forecast to top the Buckeye State by 2031. According to the study, Ohio’s urban areas are home to a significant concentration of jobs, residents and anchor institutions, as well as industries that dominate the economy, such as manufacturing, finance, professional services, education and health care.

GOPC Executive Director Alison Goebel said the findings from

the report show that if Ohio wishes to maintain its position as a major GDP producer, the state must continue to invest in retaining and replacing residents that make up and support workers.

“There are very real, economic reasons to invest in our legacy cities and metros and ensure no Ohioan is left behind,” Goebel said.

With 4.8 million working-age Ohioans living in counties projected to experience population declines, the report recommends creating a comprehensive plan to determine whether state and federal resources are being strategically deployed.

The GOPC report also recommends the following:

◗ New economic development and residential development be steered to infill locations to avoid saddling the state with expensive utility and infrastructure costs

◗ Improving existing programs — funding brownfields assessments and remediation, county landbanks doing demolition and redevelopment, and the Ohio Historic Preservation Tax Credit program — and ensuring those programs will continue in the long term

The GOPC also suggests the state create more tools and programs, including:

◗ a CDFI Grant Fund for real estate development and small business development

◗ Neighborhood Assistance Program tax credits to help fill development gaps

◗ Dead mall redevelopment grants and tax credits similar to programs under discussion in New Jersey, California and Florida

◗ Programs that support local land use zoning to make it easier to build a range of desired housing types

Ohio’s legacy cities continue to be crucial in the state’s overall GDP, according to a new report. GREATER OHIO POLICy CENTER

Building next to The Agora to debut as mixed-use space

By Alexandra Golden

The final phase of The Offices and Residences at The Agora, a mixed-use redevelopment steps away from an iconic Cleveland concert venue, is underway.

Developers expect the project to be completed by the end of March. Pre-leasing for apartments at the project begins soon.

The building at 5000 Euclid Ave. was the original home of studios for local radio stations WMMS and WHK. Shawn Neece, a founding member of Renew Partners, one of the project's developers, called the building "iconic" and a "really big part of Cleveland history.”

Sabor Group USA developed the project with Renew Partners. Together, under RS Agora Partners LLC, they bought the property in January 2021 for $1.7 million. The property doesn't include the Agora Theater & Ballroom, a separate building that is owned and operated by AEG.

The Midtown neighborhood that's home to the property under renovation "has a lot more people living in it, and there’s definitely demand for residential,” Neece said. “This, for years, was an office building, but there isn't as much demand for office space currently. . . .So, we felt this was a great adaptive reuse project. It allows us to look at a great building, a really important building, and it’s the next chapter.”

The project is split into three sections: the east wing, the west wing and a tower. The tower is closest to Euclid Avenue, while the wings are closer to Prospect Avenue.

The project's budget, which received federal and state historic tax credits, is about $16.3 million.

LDA Architects Inc. served as architects on the project, and JCI Contractors filled the general contractor role.

“(JCI has) done a great job in restoring the building, showing it a lot of love and really preserving that space," Neece said. “I mean, we really have a great team between LDA, JCI and us.”

The east wing, which is already completed, consists of office spaces and currently houses LDA. That portion of the project won the Excellence in Creative Adaptive Reuse Award from the Cleveland Restoration Society in 2024.

The tower will consist of an unnamed restaurant, 35 apartments, and office spaces, including that of the economic development group MidTown Cleveland Inc. The tower's apartments will include 12 studio units; 12 onebedroom units; seven "one-anda-half bedroom" units; one twobedroom unit; and three studios reserved for Airbnb.

“We see great demand in the neighborhood for that type of offering,” Neece said. "We are focusing on visitors to the area hospitals, traveling doctors and nurses."

The west wing has 13 two-story loft-style apartments. Eleven of them are one-bedroom units and

the other two are two-bedroom units.

The apartments range from 550 to 1,350 square feet. A studio rents for $1372 per month, while one-bedrooms are $1,605, oneand-a-half bedrooms are $1,632 and two-bedrooms are $2230.

The project is next door to the

Agora Theater & Ballroom, but developers have made sure there is enough insulation to avoid sound problems, Neece said. The space closest to the music venue will be used as common areas, such as the gym.

“Nobody’s going to be living on top of a rock concert,” Neece said.

He said the developers are looking for a restaurant tenant that can serve residents, businesses in the area and concertgoers. When it comes to the market for future residents, Neece said the developers see the property as an “eds and meds building,”

does to its proximity to Cleveland State University and Case Western Reserve University, as well as Cleveland Clinic and University Hospitals. But in the end, he said, it's anyone who works “in that corridor between downtown and University Circle.”

The office building at the Agora complex in Cleveland’s Midtown neighborhood is being redeveloped as apartments, offices and a restaurant space. | CraIN’S CLeVeLaND buSINeSS FILe

A rendering shows the LDA architects office space in the east wing.

Renderings (above and right) show a loft apartment in the west wing. | LDa arCHITeCTS

A rendering shows an apartment in the tower.

Yost joins push for Costco to end DEI programs

By Saijel Kishan and Jeff Green, Bloomberg

Nineteen Republican attorneys general, including Ohio's Dave Yost, called on Costco Wholesale Corp. to end its workforce diversity policies after the bulk retailer became one of the few companies to defend its practice.

The state officials, including those from Texas, Alabama and Kentucky, said in a letter to Costco CEO Ron Vachris on Monday, Jan. 27, that the retailer’s decision to defend its diversity, equity and inclusion efforts goes against the Supreme Court’s 2023 ruling against affirmative action in university enrollment. The ruling doesn’t apply to companies.

“I’m putting Costco on notice to do the right thing and eliminate discriminatory DEI,” Iowa Attorney General Brenna Bird said in a separate statement.

Costco fought off an investor proposal at its annual shareholder meeting on Jan. 23 from a conservative group seeking details of the risks attached to so-called DEI policies. The company defended the legality of its DEI programs, saying its “commitment to an enterprise rooted in respect and inclusion is appropriate and necessary.” Costco declined to comment on the letter.

The pushback from state Republicans comes as President Donald Trump’s new administration lashes out at DEI programs and tries to eliminate them in the federal government and corporate America. Walmart Inc. and Meta Platforms Inc. are among companies that have rolled back DEI programs in recent weeks under pressure from conservatives.

The executive order used vague language to discourage what it said was “illegal DEI” programs, causing confusion

and spurring corporate leaders and lawyers to try to decipher what that means.

Advocates for diversity programs say that diverse teams are positive for companies in myriad ways, including by helping with talent retention and by helping firms better understand their

Tarkett to close Middlefield facility, lay off 92 workers

By Scott Suttell

Flooring and sports surfaces maker Tarkett USA Inc. is closing a distribution center in Geauga County, resulting in 92 layoffs.

The layoffs at the facility at 16077 Industrial Parkway in Middlefield will begin Feb. 28, according to a notice Tarkett filed with the state of Ohio to meet requirements of the Worker Adjustment and Retraining Notification (WARN) Act.

The company said in the WARN notice that the closing "is expected to be permanent," and that as a result, bumping rights do not exist. Tarkett, in the notice, did not state why it is closing the Middlefield operation.

About 80 of the affected em-

ployees are represented by Teamsters Local Union 507, according to the notice.

Winn Everhart, president and CEO of Tarkett North America, said in a statement in response to a Crain's inquiry, "Tarkett announced the closure of our Middlefield, OH, distribution center to consolidate these operations, along with two other third-party distribution centers in Aurora, IL, and Murfreesboro, TN, to a new facility in Columbus, OH.

"It was an extremely difficult decision that we did not make lightly. We are working with union officials to ensure that affected employees receive severance payments and benefits, and we are committed to supporting them through this transition. By consol-

customers.

Costco doesn’t list many specific DEI programs in its corporate materials. One initiative is a supplier program it started in 2005 that’s designed to “partner with community organizations to identify qualified diverse suppliers to support our business.” Oth-

ers include philanthropic engagements and employee development goals that “provide all employees with training, education and opportunities for career development.”

The attorneys general, which include those from Texas and Georgia, are demanding Costco

say within 30 days whether it has repealed its DEI policies or explain why it hasn’t done so. Yost recently announced he intends to run for Ohio governor in 2026. The move comes after Texas Attorney General Ken Paxton asked Wall Street firms to answer questions about their DEI measures.

idating our distribution operations, we will become more efficient, enhance how we serve our customers, and reduce our carbon footprint. "We remain dedicated to our presence in Ohio and will continue employing Ohioans at our North American headquarters in Solon and other manufacturing sites in Middlefield and Chagrin Falls."

mediately available to comment.

A spokesperson for the Teamsters wrote in an email that the union local's secretary-treasurer was in negotiations and wasn't im-

Tarkett is a French multinational company with 12,000 employees, 23 R&D centers, eight recycling centers and 34 production sites worldwide. The company's North American operations are based in Solon.

Tarkett’s distribution center at 16077 Industrial Parkway in Middlefield | COSTAR

Costco has defended the legality of its DEI programs, saying its “commitment to an enterprise rooted in respect and inclusion is appropriate and necessary.” BLOOMBERG

Proposed law renews push to exempt craft brewers, wineries from franchise laws

By Jeremy Nobile

A state lawmaker is renewing a push to change Ohio’s franchise laws to the benefit of smaller, independent breweries and wineries.

But whether this latest e ort — which comes via Senate Bill 23, introduced last month by Sen. Andrew Brenner — garners more support in the latest general assembly is to be seen.  e proposed legislation would exempt any manufacturer that produces fewer than 250,000 barrels of alcohol a year from the current franchise laws, a level that would apply to every craft brewer in the state, including larger craft brands like Great Lakes Brewing Co. and Rhinegeist Brewery.   Franchise laws govern the contractual relationships between alcohol manufacturers and their distributors.

However, the contracts set between them are more onerous for suppliers to get out of than other business contracts.

Miller and Coors.

e spirit behind the franchise law at the time was to create a dynamic that made it prohibitively di cult for those powerful companies to easily or arbitrarily cancel contracts with small wholesalers, which, at worst, could put them out of business. erefore, the law provided stability for those wholesalers.

e craft alcohol industry argues that times have changed since then and that franchise laws should be modernized to re ect that.

Ohio is now home to more than 440 craft breweries and some 400 wineries, while consolidation has shrunk the state's cadre of alcohol wholesalers to a few dozen. Critics say the dynamic in place now creates a power imbalance that bene ts those wholesalers at the expense of independent alcohol manufacturers.“ (S.B. 23) is about leveling the playing eld for Ohio’s small craft brewers,” Brenner said in a statement.

The proposed legislation would apply to every craft brewer in the state, including larger brands like Great Lakes Brewing Co. and Rhinegeist Brewery.

is is because of a requirement to demonstrate an unspeci ed "just cause" for terminating a wholesale relationship, which can be di cult to establish. As a result, suppliers say that they can become locked into distribution contracts with little recourse to break things o if that relationship becomes unsatisfactory.

" e only way out is a legal battle that takes months and possibly longer," Brent Zimmerman, CEO of Saucy Brew Works, has told Crain’s. "Most do not even attempt that due to legal dollars involved and the ability of the distributors to sti e the brand. ey can literally make or break a brand with no consequence. at's not a good platform for doing business."

Ohio's beer and winemakers have joked that it's easier to divorce a partner of 30 years than it is to break up with your wholesaler because of the laws in place today, which have remained unchanged since the enactment of the Ohio Alcoholic Beverages Franchise Act in 1974.

While the craft industry was e ectively nonexistent in the ’70s, hundreds of small, independent, family-owned distributors relied almost exclusively on Big Beer brands like Budweiser,

tribute."

Brewers like John Haggerty, cofounder of Warped Wing Brewing Co. in Dayton, don’t necessarily buy that. His view is that a wholesale industry still largely reliant on Big Beer shouldn’t be expected to always be invested in the success of a small craft brand.

He added that wholesalers are not motivated by a magnanimous sense of consumer choice in maintaining the status quo, but rather by their reluctance to give up the leverage and control they've come to enjoy. Wholesalers will still collect the average 30% markup on

whatever they sell, in addition to any other fees related to the contract.

" ese guys are not the advocates of choice or change or anything, but guardians of the market trying to dictate how it runs," Haggerty told Crain’s.

Brewers, in particular, have been campaigning for reform of state franchise laws since at least 2023. And Brenner previously backed a comparable bill to S.B. 23, but it never passed.  e OCBA is optimistic that could change this time around.

“Since 1974, the state of Ohio

has held its thumb on the scale in favor of beer distributors and to the detriment of independent breweries due to franchise law,” Mary MacDonald, executive director of the OCBA, said in a statement. “Lawmakers on both sides of the aisle recognize that franchise law is anticompetitive and actively harmful to small businesses. We appreciate Sen. Brenner’s continued action on behalf of Ohio’s small and independent breweries, and we urge the General Assembly to support reasonable, common sense reform of this outdated law.”

“ ese businesses are a vital part of our local economy, creating jobs and producing highquality products. By reducing the barriers to changing distribution contracts, we’re giving them the tools they need to grow, innovate and reach more customers across the state.”

For their part, wholesalers have contended that Ohio's current franchise laws foster the growth of craft beer and wine brands and support consumer choice. They have also asserted that when issues arise between distributor and supplier, those are often worked out without court intervention.

For reasons like these, the Wholesale Beer & Wine Association of Ohio (WBWAO) has lobbied to maintain the status quo.

"We believe the marketplace in Ohio is as robust and competitive as any consumer product for food or beverage goods that you will see in any store," WBWAO spokesman Jacob Evans previously told Crain’s. "We believe Ohio laws help support that competition and choice, and frankly, the franchise law is a strong part of that. It's what allows wholesalers to make independent decisions as to what brands they will or will not dis-

Packaged beer is prepped for distribution at Saucy Brew Works. | SAUCY BREW WORKSSS

Meaden & Moore names first new CEO in 17 years

By Jeremy Nobile

With the beginning of the year, Meaden & Moore has elected company veteran Jim Rollins to succeed longtime CEO Jim Carulas as its new top executive.

It's the first new CEO in 17 years for the Cleveland-based accounting and advisory business and Rollins has sights set on continuing the firm’s growth that's played out under the leader before him.

Carulas shifts into a role as senior partner whereby he will support the leadership team through the transition, among other responsibilities.

“Additionally, I will maintain and support client relationships I’ve built over the years, ensuring continuity and consistency in the service they’ve come to expect,” Carulas said. “This transition allows me to focus on these priorities while leveraging my experience to support the firm’s continued success.”

Rollins, who first joined the firm in 1989, was most recently partner-in-charge for the company’s assurance and tax services group.  His election comes as the result of a “carefully considered internal succession plan,” Carulas said.

“Given the unique nature of our firm — a diversified professional services business encompassing accounting, tax, forensic accounting, business and technology advisory, and wealth management — it was critical to select a leader with a deep understanding of our business operations and culture,” Carulas said. “Rollins’ extensive experience and demonstrated leadership made him the natural choice to guide the firm into the future, eliminating the need for a formal external search.”

Carulas said that after serving five terms as firm leader, spanning nearly two decades, it was simply time to hand off the reins.

“This is not just about me stepping aside,” he said. “It’s about positioning the firm for continued success as we grow and adapt to the increasing complexity of

our business.”

Under Carulas’ leadership, Meaden & Moore, founded in 1919, has expanded to 15 offices across the U.S. and U.K. encompassing approximately 250 employees, 110 of which are tied to its headquarters in Northeast Ohio.

Rollins said his overarching goal in his new role is to pursue

continued growth that “enhances our ability to serve clients, supports our team, and positions us for long-term success.”

He highlighted efforts in recent years to achieve just that, including opening new locations in Denver and San Francisco, expanding the business in Los Angeles, “recasting” operations in

Spectrum operator to cut 259 jobs

By Scott Suttell

Charter Communications Inc. has told the state of Ohio it will close a residential inbound sales call center in Akron, a move that will result in the loss of 259 jobs. Stamford, Connecticut-based Charter, which operates the Spectrum brand, disclosed the planned layoff in a notice filed with the state under requirements of the Worker Adjustment and Retraining Notification (WARN) Act.

Charter said in the notice that the layoffs are expected to begin on March 28. The employees are not represented by a union. Of the 259 people slated to be laid off, the vast majority (229 workers) carry the title of residential inbound sales representative, the

notice stated.

The residential inbound sales call center is at a Charter office at 530 S. Main St., Suite 1751 in Akron. The company said it does not recognize “bumping rights” that would allow any employee to displace another employee based on seniority or any other factor.

Charter said in the notice filed with the state that "the entire facility will not be closed as a result of this action."

A Charter spokesperson provided this company statement to Crain's:

"We are transitioning the work done at our Akron call center to other centers, effective March 29, 2025. We have elected to transition this work to our other U.S.-based Inbound Sales centers, where we

can deliver information, training and technology to our representatives more efficiently.

"Employees can choose to transfer to another Inbound Sales Center or apply for another role with the company for which they are qualified, and are eligible to receive relocation benefits. Any employee who does not have a new position by the time the center closes will be eligible for comprehensive severance benefits.

"Charter is a major employer in Ohio and continues to invest in its operations and facilities in the state, including a new regional headquarters in Hudson, Ohio."

Charter is a broadband connectivity company and cable operator with services available in 41 states through its Spectrum brand.

"As the pace of change accelerates, our focus remains on hiring and developing the right talent, delivering high-value services to clients and refining our operations to stay agile and forwardlooking,” he said.

“Rollins is an ideal fit for the role of CEO because he exemplifies the qualities that have defined our firm’s success for over a century,” Carulas said.

“As we enter our 106th year, each generation of leadership has had to adapt to the evolving business and economic landscape, but the one constant has been our culture," Carulas added, "one that prioritizes people, both our staff and our clients, while fostering collaboration, innovation, and continuous learning, with a relentless focus on delivering exceptional client service.”

“Rollins’ extensive experience and demonstrated leadership made him the natural choice to guide the firm into the future ... he exemplifies the qualities that have defined our firm’s success for over a century.”

Jim Carulas, outgoing Meaden & Moore CEO

London, hiring staff in India to support teams in assurance and tax and broadening its manufacturing consulting practice, among other things.

Rollins also underscores the importance of attracting and developing staff in what remains an extremely competitive market for talent in the accounting space.

Some of the business segments the firm has been working to enhance include its wealth management practices, advisory and fractional chief financial officer services and litigation support services.

While many larger accounting firms are continuing to generate scale through acquisitions — like CBIZ’s recent combination with Marcum — Rollins indicates that his firm is open to strategic acquisitions but most acutely focused on organic growth.

“Our independence allows us to stay focused on what matters most — our clients, our people, and our communities — without external pressures that might compromise our trusted relationships built over generations, firm values, or long-term vision,” he said. “While the M&A landscape continues to evolve, our priority remains finding sustainable paths for growth and profitability while maintaining the flexibility and culture that have been central to our success.”

Meaden & Moore ranks among the top 10 largest accounting firms in Northeast Ohio, according to Crain’s research, as measured by in-market certified public accountants. The firm reported $51.4 million in revenue for 2023.

Jim Rollins has been elected as the new CEO of Meaden & Moore. | MEADEN & MOORE PHOTOS

Cleveland Clinic CEO details ‘leaner’ outlook

System faces staff cuts and industry headwinds

By Paige Bennett

Cleveland Clinic’s decision last week to eliminate more than 100 positions, representing 3% of management, comes as part of an enterprisewide effort to be “leaner” amid industry headwinds.

President and CEO Dr. Tom Mihaljevic said during his annual State of the Clinic presentation that the health system does not foresee additional significant layoffs in 2025, but it must find more efficient ways to care for patients and reduce costs in light of the ongoing economic pressures facing health systems.

“Globally, our greatest opportunity is to be leaner in the work we do, which can liberate more resources for patient care,” Mihaljevic said during his 2025 State of the Cleveland Address, which was live-streamed on Jan. 27.

The Clinic generated nearly $16 billion in revenue in 2024, ending the year with an operating margin of 1.7%. While it was a positive year for the health system and a marked improvement over the previous one (the Clinic had 0.4% operating margin in 2023 and recorded losses during the pandemic), the Clinic still fell short of its expectation of 2.7%.

Post-pandemic recovery has been slower than anticipated, Mihaljevic said. Pre-COVID, the Clinic typically realized an operating margin of between three and five percent. Still, the health system is doing better than many of its peers. About 40% of U.S. hospitals were still losing money in 2024, according to consulting firm Kaufman Hall.

An unexpected increase in charity care last year, combined with rising supply costs, smaller discounts on drugs through the federal 340B program and a spike in insurance premiums for

malpractice, were factors Mihaljevic said affected the Clinic’s financial performance.

“Many of our peers have not been able to withstand these pressures,” he said. “We are doing well by comparison because of the demand for our services and because we continuously innovate the delivery of care. Yet innovation must permeate every activity at Cleveland Clinic, including our operational excellence.”

Mihaljevic said there was a “very facilitated” process of enrolling patients into Medicaid programs during the pandemic, but after the declaration of a national emergency ended, the enrollment process became more cumbersome for patients. Many did not enroll in Medicaid, he said, yet they continue to need medical services. The Clinic saw a 40% uptick in charity care in 2024 compared with 2023.

With President Donald Trump’s return to office, Mihaljevic said it

was too soon to speculate on any potential policy impact on health care. However, he said the Clinic is primarily interested in influencing coverage for patients enrolled under Medicaid and those who receive charity care in the absence of coverage. It’s important, he said, to have a streamlined path to enrollment.

Clinic looks to grow its operations

Mihaljevic said the Clinic’s financial performance has not changed its plans for growth. Although it has no immediate plans for geographical expansion, the Clinic is building in areas where it already has a presence, including Northeast Ohio. The expansion of the Cole Eye Institute will open for patients in the first quarter of this year, Mihaljevic said. And the health system is constructing a new institute for neurological care on its main

UH Rainbow Babies & Children’s names chief of pediatric surgery

By Paige Bennett

Dr. Michael Dingeldein has been named chief of pediatric surgery at University Hospitals Rainbow Babies & Children’s Hospital.  Dingeldein, a 10-year veteran of the health system, has held the role on an interim basis since June 2024. He previously served as medical director of children’s surgery at UH Rainbow Babies & Children’s.  He succeeded Dr. Edward Barksdale Jr., the hospital’s longtime chief of pediatric surgery, who held the role for 17 years before his departure last year, a

UH spokesperson told Crain's. Barksdale currently serves as chief surgical officer at Chicagoland Children’s Health Alliance in Chicago.

“Dr. Dingeldein is highly respected as a talented surgeon, a collaborative colleague, and a passionate advocate for children,” Jana Bazzoli, interim president at UH MacDonald and Rainbow Babies & Children’s hospitals, said in a news release issued Tuesday, Jan. 28. “I am confident he will be outstanding in this new leadership role as chief of pediatric surgery.”

Dingeldein earned his medical degree from The Ohio State University and completed his general surgery residency at Rush University and Cook County Hospital in Chicago. He also did fellowships in pediatric surgical critical care at Chicago’s Lurie Children’s Hospital and in pediatric surgery at Oklahoma Children’s Hospital.

He has been the director of trauma for UH Rainbow Babies & Children’s Hospital for more than a decade and also serves as surgical director of the pediatric inten-

campus that will open in 2027 and be its largest hospital building to date.

The Clinic is also in the process of designing a new master plan for its main campus in Cleveland. Mihaljevic said it was too early to share many details, but that a major emphasis will be placed on how the campus is integrated with the surrounding neighborhoods.

Despite no plans for geographic expansion, the Clinic will tap into new areas this year through Cleveland Clinic Connected, a program in which partner hospitals gain access to quality improvement and advisory services and education and training opportunities through the Clinic. Mihaljevic said the organization will partner with the Alice L. Walton Foundation and the Mercy Hospital system to bring Cleveland Clinic Connected to Northwest Arkansas.

Internationally, the health system is expanding through Cleveland Clinic Connected, with arrangements based in Vietnam, Chile, and Mexico. Mihaljevic said

the program allows the Clinic to share best practices without entering into mergers or acquisitions involving huge capital investments in other geographies.

New AI tools coming to health system

In last year’s State of the Clinic Address, Mihaljevic emphasized the importance of artificial intelligence and its expanding role in health care, a sentiment he echoed again this year. He described the Clinic as being at “the forefront of a digital revolution that will improve patient care, reduce caregiver burnout, and streamline operations.”

This quarter, the Clinic is rolling out a digital scribe tool that will listen to a conversation between a patient and their provider during their office and then create notes using medical terminology. Mihaljevic said the Clinic has been piloting the tool for months and that it is designed to improve the experience for both patients and caregivers.

sive care unit and extracorporeal life support. He also is an associate professor of surgery at Case Western Reserve University’s School of Medicine.

Dingeldein is involved in several national organizations, including the EMSC Innovation and Improvement Center’s Trauma Domain and the APSR Pediatric

Disaster Center of Excellence, Region V for Kids’, Trauma Domain.  He serves on the executive board of the Pediatric Trauma Society, the central committee of the American College of Surgeons Committee on Trauma and is chair of the trauma committee of the American Pediatric Surgical Association.

Dingeldein

Mihaljevic

CSU wrestlers, alumni hope to save program

By Joe Scalzo

At 3 p.m. on Thursday, Jan. 23, Jason Effner — a former Cleveland State wrestler whose family is more deeply connected to the program than any other — saw that he had missed a call from the Vikings’ athletic director, Kelsie Gory Harkey.

He listened to the voicemail, “and my stomach dropped.”

Cleveland State’s board of trustees had just voted to eliminate wrestling, women’s golf and softball at the end of the academic year as part of the university’s yearlong strategy to close a projected $40 million budget gap.

Effner — whose father, Jack, was CSU’s head wrestling coach from 1998 to 2008 and whose brother, Marcus, also wrestled for the program — still donates heavily to the program, which was briefly on the chopping block in the spring of 2015 before CSU students saved it by approving a hike in student fees.

Now, he’s hoping to do the same thing, with plans to spend this weekend working with an attorney, an accountant and the National Wrestling Coach Association on a strategic approach to see if the program can be saved. One Viking wrestler, Joey Lyons, immediately started a GoFundMe account with a $16,000 goal, writing, “For decades, this program has shaped lives, instilled disci-

pline, and fostered a sense of community and pride on and off the mat. Today, we refuse to let this rich legacy be erased without a fight.”

(The campaign raised $936 as of Jan. 24.)

Cleveland State, which announced the cuts via press release on Jan. 23, has not made anyone available to speak about the decision. However, numerous athletes took to social media that day and the day after to reopen their recruitment and find new homes. CSU has promised to honor all athletic financial aid, but that’s not as reassuring as it sounds, Effner said.

The Vikings’ wrestling program,

for instance, has 37 athletes but only operates on the equivalent of three full-ride scholarships, generating an estimated $373,800 in tuition revenue. CSU has decreased its full-ride equivalency from 9.9 scholarships in 2015 to five in 2023 to three this season. Effner said that it has also gone from three full-time coaches to two. The program’s expenses in 2023, according to a P&L statement, were $328,123. CSU’s wrestling program also made $9,241 in ticket revenue, $32,000 in contributions and $356,728 in student fees, which amount to $3 per credit hour following the vote by CSU students in 2015.

"If the goal was to truly cut spending for a struggling university, then why was wrestling even in this conversation?" Effner said. "Clearly it's not a strain on resources.

"It’s no secret what universities are going through these days and we all knew there was going to be budget cuts. It's been talked about in the department for a while. I just think it's short-sighted.”

The scholarship cuts have hurt the wrestling program’s competitiveness in recent years, but the softball team won last year’s Horizon League tournament to earn its third NCAA tournament bid in school history.

“In their most recent strategic plan, the athletic department's mission was listed as raising student body engagement,” Effner said. “How do you raise student body engagement by eliminating a championship program?”

Cleveland State’s program cuts aren’t an anomaly. Over the past two months, at least 34 NCAA programs nationwide have been eliminated or downgraded and the proposed $2.8 billion House v. NCAA settlement would set new maximum roster limits for every Division I NCAA-sponsored sport, reducing D-I opportunities by at least 4,739 if the settlement is approved, according to ESPN. A recent analysis in High School on SI suggests the cuts could be as high as 25,000.

“There's less opportunity out there for these guys to find something,” Effner said. “They're going to be forced to maybe look at Division 2 and Division 3 options, which are way more expensive. When you talk about the burden that these 37 kids are going to face, it's amazing.”

In a post on X, Lyons noted that CSU’s men’s basketball team has just three Ohio athletes, while the wrestling team has 30. Also, its team GPA of 3.5706 ranked second among Division I programs, Effner said.

“This stark contrast (in Ohio athletes) is especially significant for a university whose vision emphasizes being, ‘An anchor institution for Northeast Ohio, recognized for cutting-edge research, creative activity, and innovative collaborations that drive economic development and enrich the lives of our students and citizens,’ ” Lyons wrote. “Despite the persistent challenges with funding, (head wrestling coach Josh Moore) has consistently recruited driven, talented, and resilient young men who excel both on the mat and in the classroom. The track record speaks for itself. Unfortunately, there has been little to no consideration of the profound impact this decision will have—not only on the athletes and coaches but also on the culture, tradition, and legacy of the entire athletic department."

Star-studded celebration marks sports awards anniversary

By Joe Scalzo

Over the last 25 years, David Gilbert and Co. have built the Greater Cleveland Sports Awards into an event that doesn’t just raise money.

It raises pride.

“It makes me feel good that we’ve created something that is, I think, valued,” said Gilbert, president and CEO of the Greater Cleveland Sports Commission (GCSC). “Obviously, for us, it's our one big fundraiser and it raises a significant chunk of our annual operating budget. But I just love the fact — and I’m grateful for the fact — that it’s had staying power.

“I think, in and of itself, it’s a really valued asset in the community.” The awards will celebrate their 25th anniversary on Thursday, Feb. 6, at Rocket Mortgage FieldHouse with a star-studded lineup that includes a fireside chat with members of the 1995 American League champion Cleveland Indians; appearances by Cleveland natives Katie Moon (who won silver in the pole vault at the 2024 Summer Olympics) and Ted Ginn (a Glenville High School graduate who played receiver at Ohio State and in the NFL), as well as former Cavaliers, Guardians and Browns players.

The organization also will present its Lifetime Achievement

Award to Cavaliers owner Dan Gilbert. The award is given annually to a person “who has dedicated their life to the advancement of sports in Cleveland.”

“We’ve been wanting Dan Gilbert to accept the award for a few years,” said David Gilbert (no relation). “We’re so thrilled that he’s going to be there and do an interview.”

Also, the event will feature a

new $75 ticket option to the “Diehard District,” which includes seating in the arena’s lower bowl, $10 toward concessions, and access to the after-party.

This is the third straight year the event will be held without COVID-related restrictions at Rocket Mortgage FieldHouse, and the GCSC is hoping to draw as many as 1,800 people. It was previously held at the Renaissance

Cleveland Hotel.

“Obviously, with this being the 25th year, we wanted to make it special,” Gilbert said. “We’re bringing back a lot of past award winners, and we’ll have a lot of really cool references to the past 25 years. And we’ll probably have a little bit more of a focus on the accomplishments of the sports commission than we normally do.”

David Gilbert re-founded the GCSC in 2000 — “I was the first head of the organization when it was just two people,” he said, laughing — and drew a crowd of 600 people for the first awards ceremony, which was emceed by legendary broadcaster Bob Costas.

“I don’t know if we had expectations, but I walked out of that event thinking, ‘That exceeded whatever expectations we had,’ ” he said. “The one thing I remember is that Bob Costas was there and I still don't know if I've ever been at an event where someone was such a good storyteller. He was captivating as the emcee.”

From the start, the GCSC tried to celebrate Cleveland’s athletes and teams at all levels, handing out awards for best male and female high school and college athletes of the year, as well as one for the professional athlete of the year.

The organization has also expanded the number of awards each year, including the Courage Award, which is now named after former Browns play-by-play man Jim Donovan, who died last October after a long battle with cancer.

“This night is all about celebrating the past sports year in Cleveland,” David Gilbert said. “And I really think it has become one of the largest and best events of its kind in the country.”

The Case Western Reserve University men’s tennis team celebrates winning the 2024 male collegiate athletes of the year award at last year’s Greater Cleveland Sports Awards at Rocket Mortgage FieldHouse. | GREATER CLEVELAND SPORTS COMMISSION

Fire-damaged building in Cleveland Heights project to be rebuilt

By Alexandra Golden

Cleveland Heights Chief Building Official Eric Elmi announced at a press conference on Monday, Jan. 27, that the fire-damaged building in Cleveland Heights' Marquee mixed-use development will need to be demolished and rebuilt.

The 74,230-square-foot building at 13230 Cedar Road caught fire on Jan. 24, and it took 20 hours for the blaze to be fully extinguished.

Elmi said that the building that caught fire was 75% completed. The project's second building, located on Lee Rd., between Tullamore Rd. and Meadowbrook Blvd., was not affected and was completed in January.

Cleveland Heights Fire Chief Jim Harry said the emergency scene is still active, and the cause of the fire is being investigated.

The fire investigation task force — comprised of investigators from the fire department and police department — is leading the inquiry with additional help from the Hillcrest Heights Regional Fire Inves-

tigation Unit, team members and partners from the state’s fire marshal's office and the Bureau of Alcohol, Tobacco and Firearms, Thomas Beers, the primary investigator for the fire, said at the press conference.

“We never come into it with the idea that it is intentionally set or accidental,” Beers said. “We come in very blindly and allow the facts of the case speak for themselves. . . .We take all of the evidence into its totality.”

Beers said there were no definitive answers yet regarding how secure the building was before the fire began on Jan. 24.

There is no timeline for how long this investigation will take due to the size of the building and the fact that it is “playing against elements such as cold, wind, ice, and water,” Beers said. However, he said that it is proceeding in a “very timely and efficient manner.”

Beers added that because the building was under construction and not fully completed, the sprinkler system was not required to be turned on because it was

an unoccupied structure. He also stated that there was regular communication with the fire inspector who had been in and out of that property, and there was no indication that there was anything untoward or unsafe in the building.

Cleveland Heights Mayor Kahlil Seren said a structural engineer will need to assess the building's safety before the investigation continues. He said this may “take a little bit of time” as the property is now encased in ice after “millions of gallons of water” were used to put out the fire and froze in the cold winter weather.

Once the investigation proceeds, Seren hopes to “very quick-

ly move to demolish the property so that we can begin rebuilding.”

Seren assured that the city of Cleveland Heights is “dedicated to rebuilding” and to no unnecessary delays in the progress of the rebuild. Seren also spoke with Deron S. Kintner, vice president of development and special adviser at Flaherty & Collins Properties, and stated that they are “fully on board as partners with the city in the completion of this phase” of the project.

"Flaherty & Collins is fully committed to rebuilding and restoring what was lost as soon as we are able to do so," according to a statement from Flaherty & Collins Properties. "We will continue to

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provide updates as we work through the investigation process with city and fire officials."

The $66 million, two-building mixed-use project broke ground in May 2023 and was anticipated to be complete by this summer, according to developers Flaherty & Collins Properties.

Seren added the investigation is needed to determine the cost of the rebuild.

“It was a relatively large section of the project, so we anticipate that the cost will be relatively expensive, but we don't believe that it's out of reach to move forward and correct this issue and get over this hurdle toward completion of the full project,” he said.

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A rendering shows The Marquee at Cedar Lee in Cleveland Heights. | FLaHerTy & COLLINS PrOPerTIeS/CITy OF CLeVeLaND HeIGHTS

Inaugural phase of riverfront project gets $9M in tax credits

By Kim Palmer

The inaugural phase of the Cuyahoga Riverfront Development — part of the city of Cleveland’s Shore-to-Core-toShore plan — was awarded more than $9 million in tax credits for a $488.7 million mixed-use project.

Nearly $98 million in Transformational Mixed-Use Development (TMUD) tax credits for a total of nine statewide projects were announced Monday, Jan. 27.

Of that total, $10.5 million of the tax credits went to two Northeast Ohio projects.

In addition to the $9.1 million for the downtown Cleveland riverfront plan, nearly $1.4 million in TMUD credits were awarded to the rehabilitation of the Mahoning National Bank office tower in Youngstown.

The $16.5 million rehabilitation of the historic at 23 Federal Plaza East will create an event space in the 13-story building’s basement bank vault, convert the upper floors into 71 residential units and upgrade floors 1-4 for commercial use.

The project is expected to create approximately 180 construction jobs and 196 permanent jobs in the building, which opened in 1911.

Riverfront Cleveland plan

The first phase of the $3.5 billion riverfront development project includes the construction of the Cleveland Clinic Global Peak Performance Center. The two buildings will include a new Cleveland Cavaliers practice facility (relocating from Independence) and a Cleveland Clinic medical facility.

In addition to the Peak Performance Center, Bedrock plans to develop a 17-story mixed-use building, featuring a 190-room hotel, on the eastern side of the Cuyahoga River.

The 560,000-square-foot space will also hold a 6,100-seat live entertainment venue, restaurants and retail space connected to both Tower City’s retail center and Rocket Mortgage FieldHouse.

The project, which is expected to create approximately 2,944 construction jobs and 548 permanent jobs, will transform the 100-foot drop from the Tower City parking lots to the river with buildings, a park, a plaza and a kayak launch replacing surface parking lots.

In 2024, Cleveland City Council passed a public financing package creating a TIF projected to provide around $3 billion in revenue over four decades to support the core-to-shore infrastructure work. The Port of Cleveland board

of directors approved $50 million lease revenue bonds.

Cincinnati’s mixed-use stadium development award

Another notable project receiving $26 million in TMUD credits is Cincinnati’s West End TQL Stadium mixed-use development plan. The nearly $332.8 million project includes office space, a hotel, residential and retail build-out, and updates to the $250 million, privately funded soccer stadium.

The home to FC Cincinnati soccer club, the multi-phased, mixed-use development is similar to one proposed by Cleveland Browns’ owners $2.4 billion enclosed stadium and $1 billion adjacent development in Brook Park.

The TMUD award will be applied to the second phase of the West End project, which will include two 13-story towers of hotel and apartments and additions to the 518,000-square-foot TQL Stadium. That project is expected to create approximately 2,102 construction jobs and 1,699 permanent jobs at the project site.

Columbus-area projects get nearly $45 million

Several Columbus-area projects made up more than $44.8 million of the total TMUD funding. The Capitol Square Renaissance project, a $573.5 million redevelopment project to replace nearly 10 acres of old buildings and surface parking with 1,000 new residences, nine restaurants, and nearly 200,000 square feet of office space, was awarded $33 million in tax credits.

Another downtown Columbus project was awarded $4.5 million for the remediation of the 24story Estrella building at 175199 Rich Street. The $122.6 million redevelopment project will create a mix of residential units, restaurants, grocery, office space, event venues and a public plaza.

A separate $270 million, multi-phased, 3 million-squarefoot mixed-use development — the Galaxy at Polaris — just north of downtown Columbus also will receive tax credits. This second phase project will add 11 new buildings of residential, restaurant, grocery, retail and office space was awarded nearly $7.4 million in TMUD credits.

And the recently announced and much-heralded Anduril drone factory, a 2.594%, 30-year Job Creation Tax Credit on its planned manufacturing facility in Pickaway County, a credit that the state says carries an estimated value of $452,263,789.

Shaker Square unveils plan to reinvigorate community

Proposal includes improved lighting, sidewalks, promenade, green space

By Dan Shingler

Shaker Square has a plan and vision for its future.

Now comes the hard part, backers say: implementation.

A few hundred people, many of whom said they live near the square or have businesses there, filled every seat and lined the doorway of a theater at the Square’s Atlas Cinemas on a cold evening, Thursday, Jan. 23.

They came to hear how the Square’s owners, Cleveland Neighborhood Progress and Burten, Bell, Carr Development, plan to reinvigorate the historic square.

It’s not a reinvention of the square — that’s something backers said they did not need or want, presenters said — but a plan to relaunch the location in its traditional roles as a shopping area and gathering place.

“It needs to be a new era for this Cleveland Classic,” Burten, Bell Executive Director Joy Johnson told the audience.

The two nonprofit development organizations purchased the square in summer 2022, with the city of Cleveland providing $12 million in loans.

Since then, and through last summer, the groups have spent or raised about $5 million in investments in the square. This money has gone toward new outdoor lighting, roofs, heating and air-conditioning systems, and other improvements for the square’s business tenants and visitors.

They’ve also held scores of public meetings and surveyed more than 600 people about what they would like to see happen next, an effort that culminated in the new plan.

“We’ve acquired, we’ve stabilized it and we’re ready to launch

the vision plan,” CNP President and CEO Tania Menesse said in an interview before the presentation unveiling the square’s new “vision plan.”

That plan doesn’t include many specific big projects, the things that lend themselves to fancy renderings and construction schedules. Rather, Menesse, Johnson and their staffers told the packed house that it’s a roadmap for improving the entire square, the 180,000 square feet of buildings that make up its four quadrants, and spurring nearby housing development.

square have underused second floors. Plans call for improving them and marketing them to businesses like service or health care providers that don’t rely as heavily on foot traffic as traditional retailers.

There are signs that the work done so far and the promise of more to come are having an effect. The first elevator is set to be installed, which will enable the rape crisis center at the square to move to new space on the second floor, Menesse said.

“It needs to be a new era for this Cleveland Classic.”

Joy Johnson, Burten, Bell, Carr’s executive director

The city of Cleveland is helping by cracking down on existing housing in the area — much of which is old and owned by investor-landlords — and more rigidly enforcing building codes to preserve historic housing.

However, representatives of the nonprofits said there also are sites around the square that could be used for new, marketrate housing, such as singlefamily homes, apartments and perhaps condos and townhouses, and those will be pursued.

Lighting at the square should be further improved to make it more inviting, more accessible to the parking lots behind it and improve the feeling of safety necessary to attract visitors and shoppers.

Organizers added that the square’s sidewalks, promenade and green space need to be decluttered, reorganized and improved.

The retail buildings on the

Two new businesses are preparing to move in, Johnson told the audience. Coyoacan Taqueria & Brew, which promises to bring flavors of Mexico City to the square, is set to open in March. Café Indigo is set to open in February, giving the square a coffee shop requested by residents and visitors, many of whom remember when the Arabica coffee house was one of the square’s top draws.

Other challenges remain, though. The square’s owners have negotiated an early exit for Edwins and Edwins Too. The popular eateries have two or more years left on their leases, but recently announced they’re moving to a bigger space at the old Nighttown location in neighboring Cleveland Heights.

But Menesse said they’re still looking for another restaurant or entertainment spot to replace Edwins and fulfill an important role.

Many of these projects will require further investment, so the nonprofits will now focus on raising money for them, finding partners for housing development, and securing more tenants as they open new spaces.

“Now the real work begins,” Menesse said.

Dave’s Market is an anchor at Shaker Square and the grocer for many nearby residents. | GUS CHAN

Sherwin-Williams new HQ, R&D center face delays

Fire protectant was applied incorrectly to buildings and will have to be redone

By Dan Shingler

Sherwin-Williams’ anticipated move to two buildings — its new skyscraper HQ in downtown Cleveland and its new R&D Center at the Valor Acres development in Brecksville — is being delayed.

The two projects, with reported combined costs of about $750 million, are among the largest construction projects in Northeast Ohio — but will take even longer than planned to complete.

Responding to rumors that the city was withholding an occupancy permit for the new building on the west side of Public Square, Cleveland officials said the issue is due to a problem brought to their attention by those working on the project.

A Sherwin-Williams product used to coat steel beams to protect them in the event of a fire was not applied correctly and will have to be redone, the city reported.

“My understanding is the product they use to coat exposed steel beams within the building is a proprietary product. Sherwin Williams noticed that the coating was too thin. So, they are in the process of rectifying an issue they found with their own product in their building,” said Sarah Johnson, the city of Cleveland’s chief communications officer, via email.

Johnson, who said she was getting her information from city fire officials, said the matter was brought to the city’s attention by construction managers who meet periodically with city officials to go over the project’s progress.

what the fix will entail, but said Welty-Gilbane and SherwinWilliams have maintained a good relationship.

“Welty and Gilbane are working closely with Sherwin-Williams to rectify the issue as quickly and cost-effectively as possible,” Taylor said. “We have a great relationship and we support the plan SherwinWilliams has put in place.”

Young expressed similar sentiments and said, “The relationship between Sherwin-Williams and Welty-Gilbane remains strong as we ensure quality and safety are top priorities.”

Neither Taylor nor Young provided additional details on timing or costs but accessing the structural steel beams of those buildings will be labor-intensive.

Workers have been finishing interiors downtown since at least mid-2024 and the Valor Acres building was topped off in July 2023. Getting at those beams would require removing any walls or other structures built over them and then rebuilding them once the coatings are reapplied.

Most of the downtown HQ building was considered done or nearly finished and the city and others have been waiting for the company to say when it plans to move its people to the new site.

The delay could also cause a domino effect for a few other downtown efforts. Most notably, that includes Bedrock’s plans to redevelop Sherwin-Williams’ existing headquarters on West Prospect Avenue and possibly the company’s Breen Technology Center on Canal Road.

Bedrock, a company owned by Cleveland Cavaliers owner Dan Gilbert, purchased those two sites in 2023 as part of a $48.5 million real estate investment to secure sites for Bedrock’s planned riverfront development adjacent to Tower City.

Julie Young, Sherwin-Williams’ vice president for global corporate communications, said the company still hopes to begin moving into the downtown headquarters and the R&D center in

“Several weeks ago, construction managers with Sherwin told city officials that inspectors discovered that the anti-fire coating sprayed on some of the building’s steel beams is not thick enough to meet safety standards,” Johnson wrote. “They will likely need some additional fire coating. Anti-fire coatings help prevent steel from buckling in the event of a fire. ... This may delay the opening of their new location.”

Ohio Bureau of Workers’ Compensation proposes 6% rate cut in July

By Scott Suttell

Private employers in Ohio are in line to receive another reduction in their workers’ compensation premiums.

The Ohio Bureau of Workers’ Compensation on Jan. 24 announced it proposed a 6% rate reduction to the agency’s board of directors.

The board will consider the pro-

posal at its meeting on Friday, Feb. 28. If approved, the rate reduction will take effect July 1. BWC said in a statement that private employers "would be paying close to $60 million less" in the next fiscal year if the cut is approved.

If recent history is a measure, the rate reduction almost certainly will be approved.

BWC said the reduction, if approved, would be the sixth cut

Brecksville in 2025.

“The process of inspecting the coating on steel beams is occurring at the global headquarters and at the global R&D center sites and is one among many typical processes to ensure that both facilities meet commercial building standards,” Young said. “We still expect to begin the multi-phase move to our facilities later this year.”

Bedrock declined a request to discuss the issue or answer questions on how it’s being affected.

Don Taylor, CEO of Welty Building Co., which is constructing the project in a joint venture with Gilbane, declined to specify

since Gov. Mike DeWine took office in 2019, and the 16th decrease in the last 17 years going back to 2008.

Overall, BWC said average rate levels for 257,000 private and pub-

lic Ohio employers "are at their lowest in over 60 years."

In a statement, BWC Administrator/CEO Stephanie McCloud said the reduced rates are "due to Ohio’s workforce and their con-

The issue with the coating at the HQ building downtown was first reported by Signal Cleveland.

tinued dedication to creating a safe workplace.”The proposed 6% rate cut is an average statewide premium change, and premiums paid by individual private employers can vary, based on factors such as expected future claims costs in their industry, their company’s recent claims history, and participation in BWC safety programs.

BWC did not respond to Crain’s request for additional comment by press time.

Ohio Chamber of Commerce President and CEO Steve Stivers on Jan. 24 issued a statement supporting the proposed cut, which he said "would greatly benefit business owners across the state" and help "make Ohio the best place in the nation for business.”

Sherwin-Williams’ new research and development center in Brecksville, shown in 2024

The new Sherwin-Williams headquarters in downtown Cleveland | THe SHer WIN-WILLIaMS COMPaNy PHOTOS

LARGEST ARCHITECTURE FIRMS IN NORTHEAST OHIO

Ramaswamy says it’s ‘likely’ he’ll run for governor

By Anna J Kaiser, Bloomberg

Vivek Ramaswamy said he’s preparing to run for governor in his home state Ohio, after dropping out of a project to slash the size of the federal government.

“That’s highly likely what I’m moving towards and taking really serious steps towards looking at,” he said at the iConnections Global Alts conference in Miami Beach on Jan. 28.

The biotech entrepreneur and former Republican presidential candidate had been named by

President Donald Trump to lead the Department of Government Efficiency alongside billionaire donor Elon Musk. Ramaswamy left that role the same day Trump took office.

“It was my honor to play a role in helping get that off the ground at the federal level,” Ramaswamy said of DOGE at the conference.

“Frankly, the same effort is required in each of the 50 states.”

Ohio Governor Mike DeWine recently helped clear a path for Ramaswamy’s run. DeWine, who’s term-limited, appointed his lieu-

tenant governor, Jon Husted, to replace Vice President JD Vance in the US Senate. The appointment removed Husted as a potential rival in the 2026 governor’s race. Ramaswamy is likely to face current Ohio Attorney General Dave Yost, who announced his run for the office on Jan. 23.

On the Democrats’ side, Dr. Amy Acton, the former director of the Ohio Department of Health who was one of the public faces of Ohio’s response to the COVID-19 pandemic, announced her candidacy.

Major U.S. Steel investor Pentwater opposes Ancora’s proxy proposal

By Joe Deaux and Yiqin Shen, Bloomberg

The third-largest investor in United States Steel Corp. said it opposes moves by activist investor Ancora Holdings Group of Cleveland to shake up the board of the iconic American steelmaker.

Pentwater Capital Management

LP said it supports U.S. Steel’s current board and management, rejecting Ancora’s efforts to overhaul the steelmaker’s board and oust CEO David Burritt.

“Pentwater believes U.S. Steel’s board and management team are making the correct strategic decision for the company and Pentwater will not support the dissident slate of directors,” Matt Halbower, founder and CEO of the investment management firm, said Tuesday, Jan. 28, in a phone interview.

Ancora aims to force U.S. Steel to abandon a $14.1 billion takeover by Nippon Steel Corp. — a deal the steelmakers are fighting to save after being blocked by the White House. The activist investor has nominated nine candidates for US Steel’s board including industry veteran Alan Kestenbaum, who would become CEO. Kestenbaum, the former head of Stelco Holdings Inc., went public Monday, Jan. 27, about plans to “fix” U.S. Steel.

There’s no guarantee Kestenbaum will ever see the inside of the U.S. Steel boardroom let alone become its next CEO.

Ancora holds 0.18% of the outstanding shares in the Pittsburghbased steelmaker, and it will need to convince existing shareholders that the plan is worth it.

Pentwater holds an 8.9% stake in U.S. Steel as of September, according to data compiled by

Sequoia Financial expands footprint with Carlson Capital deal

By Jeremy Nobile

Akron-based Sequoia Financial Group said it’s rolling up Carlson Capital Management of Northfield, Minnesota, for the serial acquirer’s first transaction of 2025.

Financial terms of the deal, which is expected to be completed on March 31, were not disclosed.

In a March 2024 public filing, Carlson, founded in 1987, reported approximately $3.5 billion in assets under management (AUM) and 80 employees. The firm says its total client assets totaled $3.8 billion as of Dec. 31.

The deal marks the secondlargest ever for Sequoia in terms of assets. Its largest was the acquisition of Zeke Capital Advisors of Berwyn, Pennsylvania, in 2023, which added about $6.1 billion in assets to Sequoia at the time.

forces with Sequoia Financial, we are stronger together and will ensure continuity for our clients for generations to come.”

The Sequoia footprint grows to 34 offices in 19 states with the transaction.

“Under the leadership of Greg and Jeff, the CCM team has built an enduring firm over the past four decades. We are thrilled that they have put their trust in Sequoia Financial to work together to carry on their legacy of integrity and clientfirst service,” adds Sequoia CEO Tom Haught. “(Carlson) expands our growing national presence, has a deep bench of innovative advisors and adds a highly regarded tax planning and tax compliance capability to our practice.”

Bloomberg, making it the thirdlargest investor, after Blackrock Inc. and Vanguard Group Inc. The Naples, Florida-based manager is among investors that piled in to U.S. Steel in late 2023 amid speculation that the steelmaker would sell to a competitor at a premium.

U.S. Steel investors have weathered a turbulent 18 months since the company launched a strategic business review, a process that sparked a bidding war ultimately won by Nippon Steel with a $55a-share all-cash offer in December 2023. The offer by the Japanese steelmaker became a political flashpoint during a U.S. election year.

Former President Joe Biden blocked the deal on national security grounds earlier this month, prompting the steelmakers to pursue legal measures to rescue the deal.

In its latest public filing from August, Sequoia reported approximately $20 billion in AUM and 276 firmwide employees. The wealth manager says its total client assets as of Dec. 31 total $22.6 billion.

The Carlson deal comes on the heels of Sequoia’s acquisition of the wealth management business of Fargo, North Dakotabased accounting firm Eide Bailly, which acquired a 5% stake in Sequoia as part of that deal. Separately, Eide Bailly entered the Ohio market with the acquisition of Akron’s Apple Growth Partners last year.

The deal adds a significant piece of business to Sequoia in the Minneapolis-St. Paul area.

The combination adds a significant piece of business to Sequoia in the Minneapolis-St. Paul area.

At close, the firms said that Carlson co-founders Gregory Carlson and Jeffrey Carlson will become senior strategic advisers at Sequoia, and CEO Justin Stets will become executive vice president of integrated wealth services.

“This strategic partnership is driven by our shared goal of enhancing value for our clients and enriching their lives through an impactful wealth management experience,” Stets said in a statement. “By joining

Sequoia said that it anticipates additional growth in the wake of the Eide Bailly transaction. Nonetheless, M&A has long been a part of its growth strategy.

Sequoia is backed by San Francisco private-equity firm Valeas Capital Partners as well as Kudu Investment Management of New York. Those firms acquired minority stakes in Sequoia in 2022 and 2020, respectively.

The firm ranks among the top 10 largest wealth managers in the Northeast Ohio market as measured by local AUM, according to Crain’s research.

The U.S. Steel Clairton Coke Works facility in Pennsylvania | bLOOMberG

From Page 1

“Historically, we would be concerned with protecting what I would consider to be our four walls, our environment,” said Rakesh Sharma, interim chief information security o cer at the Clinic. “But now, there’s been a very steep increase over the last two years in third-party related attacks.”

In 2023, 58% of the total individuals a ected by data breaches were the result of attacks on a health care organization business associate, a 287% increase over the previous year, Crain’s sister brand Modern Healthcare reported.

Sharma said cyber attackers have become savvy enough to know that major health care organizations have invested heavily in cybersecurity. Rather than attempt to penetrate a hospital’s system, many will go through a third party, which is often a smaller company instead, he said.

“ ose are what they call watering holes,” said Greg Journey, who leads cybersecurity and physical security at MetroHealth. “Twenty hospitals use this vendor. Let’s attack this vendor.”

A lot of these third parties are internet-based companies, Journey added, whereas hospitals are brick-and-mortar. Much of the data held by these companies is available online, but at places like MetroHealth, an employee must be at a physical location to access it, he said.

IT experts at Northeast Ohio’s health systems agreed that managing third-party risks poses an enormous challenge to large health care organizations.

“We’re being very diligent around what access do third parties have to our systems or our environment and ensuring that we’re protecting our organization,” said Bryan McDowell, chief security o cer at University Hospitals.

at means looking closely at third-party vendors, whether they are in revenue management or radiology, and asking questions about the kind of exposure the health system could face or how it would function if they had problems, McDowell said.

e Clinic’s approach to managing third-party risks involves sitting down with clinicians to understand the services necessary to deliver patient care and maintain critical business operations, Sharma said. e health system develops incident response plans and downtime procedures so it can respond quickly in an incident.

“We bring together crossfunctional teams,” Sharma said. “We go through drills, exercises, simulations that ensure that when an incident does occur, we can respond swiftly with muscle memory to recover our systems and maintain operational continuity because, as much as we want to prevent every attack, we have to also be prepared for the event that we cannot protect ourselves from.”

Preparation also means being ready to pivot quickly when an

issue with a vendor arises, said Dave Fiser, senior vice president and chief information o cer at MetroHealth.

“Organizations like health care systems are going to have to recognize alternative plans and be able to quickly ip,” he said. “If a third party is hacked and they can’t have access and it’s an important piece of their operation, they have to have some type of backup solution ready to go and be able to migrate to it quickly.”

While third parties may present the biggest cybersecurity risks to health systems, they certainly aren’t the only ones. Traditional threats like phishing or smishing remain an issue. Last year, MetroHealth blocked 30 million cyber threats and prevented roughly 100 million suspicious emails from hitting its systems, Fiser said. “ is isn’t the kid in his basement that’s just hitting every IP address you have,” Journey said. “ is is somebody (...) that actually knows exactly where you’re logging in, and that’s what they’re attacking. So, it’s really grown as far as the size and the sophistication.”

e rise of generative AI has made these threats more advanced.

“ ey’re not guessing anymore,” Journey said. “ ey don’t have to. On phishing attacks, one of the biggest giveaways in the old days was the misspellings, the language wasn’t right. But now with ChatGPT and all those, you can have your email written for you and it’s perfect English and de nitely no mistakes in the spelling.”

But AI can also be useful for IT administrators, Journey pointed out. MetroHealth uses some AI tools to identify and block potential threats, a process that would be too time-consuming without the technology.

Robert Eardley, UH’s chief information o cer, said another emerging threat has been attackers gaining access through an IT system administrator, or someone who controls all network access.

“Once a bad person gets access, and they are in the system as a system administrator, they can do a lot more harm than if you’re a standard network user,” he said.

To combat the issue, UH introduced a strategy called privileged access management, which requires system administrators to check out a one-time password every time they want to make a network change.

Health care IT leaders agreed that cybersecurity threats are here to stay and that they will only become more complex as the role of AI grows in health care.

“ at’s a big challenge for us that we’re trying to address,” Sharma said. “AI itself is being applied in other aspects to further enable threat actors. So, previously, a very novice threat actor wasn’t able to put together or construct di erent types of attacks and exploits, and now they can. So I feel that, really, that’s the biggest emerging technology because that’s also the one the business wants to start employing as well. And with the generation of data increasing, that’s becoming likely our biggest challenge.”

ERIEVIEW

From Page 1

At the moment, there’s more deconstruction than construction going on.

“We’ve commenced demo for the residential side,” Pinney said. “We’ll nish demo there in about two months, and then we’ll start construction and do demo on the hotel side.”

e project is projected to cost $228 million, far more than the nearly $18 million the Kassouf family paid for the building in 2018, which Pinney said is included in the total cost estimate.

Pinney and other backers say the project’s going to bring something unique to Ohio: a high-level Marriott Hotel coupled with luxury apartments that the hotelier also will manage, both under Marriott’s upscale “W” brand.

“ is transaction is really critical for the area; there’s not another W hotel in the region,” Delfre said.

In addition to local incentives — including the city of Cleveland’s 10-year, $9.2 million abatement on commercial taxes at the site — Marriott’s participation has been critical to nancing the project and will play an equally large role in its long-term success.

“It was a key component to it, that it’s a Marriott Corp. project,” Pinney said of the project’s nancing.

Marriott is not an owner or equity investor in the project, “but they’re committing a good deal of resources to this,” Pinney said.

Marriott’s willingness to do the project and bring its W brand to town via Erieview speaks volumes about the project’s viability and puts Cleveland in some rari ed air, Delfre said.

e W Residences — Marriott’s name for its apartment brand — is especially important, he said.

“ is being a luxury brand for Marriott, they will operate and manage that asset,” Delfre said. “ ey will manage it and provide guidance, sta ng and amenities speci c to the residential (aspect of the project). It’s a new product, frankly, and this is one of the few in North America that they’re doing.”

A Marriott spokesperson could not be reached, but a quick look at the W Residences website shows that Cleveland is joining a list of popular international locations that also host the brand, including Dubai, Sao Paulo, Aspen, Dallas, Boston, Austin and New York City.

In Cleveland, the aim is to make a building that serves hotel guests and apartment dwellers with some of the amenities that both want.

“You’ll be able to get room service, you’d be able to get use of all the spa amenities,” Delfre said, “as well as the rooftop, and they’re going to reinvigorate the old Top of the Town

The Erieview Tower at 1301 E. 9th Street in Cleveland | COSTAR

Marriott reserves its W brand for high-end properties, like its Austin (above) and São Paulo locations. The company plans to bring the same level of development and amenities to its hotel at Erieview, project backers say. MARRIOTT PHOTOS

FUNDING

From Page 1

The funds will then be split up amongst the council members who, in turn, will disperse the money based on annual applications to the city’s 20 eligible CDCs.

Currently, CDBG dollars, provided by the U.S. Housing and Urban Development (HUD), carry cumbersome reporting requirements. Those dollars make up the majority of a CDC budget but are not well suited for all the services neighborhood organizations are expected to provide.

The federal grants, which had been restricted to about 30 types of neighborhood and housing programs, were whittled down further to only two types of projects, both related to the city’s 10-year housing plan under former Mayor Frank Jackson’s administration.

restaurant. It will be a highly amenitized tower.”

Most of the building is planned out. Pinney said a new restaurant will go into the 38th Floor, where Top of the Town was located, and there will be a rooftop bar above that.

Floors 29 through 37 will be office space, as will floors 13 and 15, Pinney said. Some existing tenants plan to stay and move to new space in the building.

Floors 17 through 28 will host 227 apartments, which will mostly be one- and twobedroom units, with a few studios, Pinney said.

“We’re shooting for the higher end of the market,” Pinney said. “But we do want some affordability, so we’ll probably have about 10% studio units.”

The hotel, which will have more than 200 rooms, will occupy floors 5 through 12, Piney said.

The bottom five floors will be used for retail and amenities such as conference and meeting rooms, lobbies for both the apartments and hotel, and probably even a pickleball court, Pinney said.

He added that the building might need more office space because it will have Class A space with the high level of amenities office tenants now want.

“I’ve received about 10 texts from random people about that. To stop getting texts, we might put pickleball in the galleria,” Pinney quipped. “At the urging of people in the community, we’re going to take a look at it.”

Plans for most of the retail, which will be in the space occupied by the old Galleria mall, are being finalized.

“We’re studying it right now,” Pinney said of the retail space. “We’re bringing on a local team to assist with concept plans ... but we’re looking at all of it, including how to maximize the street-level retail.”

that capacity around real estate work. We want CDCs to have the capacity again to help support developers, home builders and others who want to do work in the neighborhoods,” Menesse added.

Famicos Foundation, one of the oldest and largest CDCs, acted as a real estate developer for the city’s East Side.

Through the ‘80s and ‘90s, Famicos was buying, building and managing a significant amount of commercial and residential properties, providing a revenue stream that helped balance out philanthropic and city funding, said John O. Anoliefo, the CDC’s executive director.

“Back then, if our CDC wasn’t doing real estate development in the neighborhood, nobody was,” he says.

Anoliefo said he welcomes the new funding and reporting process.

“We are looking to be able to quantify and even be held accountable for the money and the work that we’re supposed to be doing,” he says. “One of the biggest problems is that people don’t really know what it is CDCs do, so if there is an understanding across the board that this is what the funding can be used for, it will make our lives very easy.”

McCormack said the strength of the new legislation is that it creates a transparent system.

In addition, CDBG funds were paid out as reimbursements for projects rather than dispersed upfront. That method meant payments were often delayed for months or, in some cases, were deemed ineligible and denied outright.

“The goal was to find a more flexible funding source to fund the important neighborhood work that, frankly, supplements services residents expect from their city,” McCormack said.

Under the new policy, each CDC will receive one-fourth of its estimated $425,000 portion of the annual general fund allotment at the beginning of the year. After that, the remainder of the funds will be paid out on a quarterly basis.

By using the unrestricted city funds, CDCs will be “nimble” when it comes to hiring staff, supporting small businesses or running recreation leagues, McCormack added.

The ordinance also specifically codifies how the city dollars can be used as CDCs will have to apply using a detailed set of metrics designed by CNP.

In 2023, CNP, which partners with CDCs to provide funding, operational, and training support, launched its Advancement and Resilience Model, identifying five main categories or “pillars” of the core work the CDCs should be focused on.

Those pillars cover 89 activities in total, and each CDC must document the work to be done in those areas to receive funding.

“This type of reporting also provides an ongoing assessment and makes it easier to apply again the next year,” Menesse said. “It is more like how most philanthropy operates.”

One of the most important areas of core work for CDCs, Menesse said, is stabilizing and strengthening the city’s residential and commercial housing.

“We are looking to rebuild

Following the foreclosure crisis in 2008 and then the onset of the COVID-19 pandemic in 2020, CDCs were pulled away from helping with the development and marketing of neighborhoods and pivoted to providing whatever services residents needed.

Those needs pulled CDCs in many directions, making their work look haphazard and inconsistent. Without a way to report on their work, residents and the council were left questioning what purpose their CDC served.

“When you’re trying to be all things to all people, you’re inevitably disappointing someone,” Menesse said. “We really needed to create a structure to identify that core work that a CDC does and put time and energy and funds into that work.”

“We are codifying what spending is eligible. There will be no confusion, no questions, and that also ensures that this specific pot of dollars is used only for neighborhood development activity,” he says.

“The new system provides both council members and the public a much clearer picture of the progress and holds the CDCs responsible for what they do for the city’s residents.”

As for the CDBG funds, McCormack said those can be used by the city to support programs centered around housing stability and meet other needs, like funding the city’s recreation centers much-needed repairs and upgrades.

There’s a lot of buy-in for the proposal, McCormack contends, which is unsurprising considering the healthy number of council and city officials who came out of the CDC world.

If passed, the measure (city ordinance 113-2025) will go into effect as part of the city’s 2026 fiscal budget.

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Menesse

Quest Diagnostics finalizes deal to acquire UH lab assets

By Paige Bennett

Quest Diagnostics has completed its previously announced acquisition of certain assets of University Hospital’s outpatient lab services business.

The deal affects about 50 locations across the health system, a UH spokesperson confirmed. Assets acquired by the New Jersey-based clinical laboratory company include laboratory draw locations based inside UH health centers.

UH and Quest Diagnostics announced in August they had entered into a definitive agreement for the company to acquire select outpatient laboratory assets from the Cleveland-based health sys-

tem, which operates more than 50 health centers and outpatient facilities across Northern Ohio.

Financial terms were not disclosed.

UH will continue to own and operate its hospital-based labs, the UH spokesperson said. It will also keep performing all testing associated with inpatient care, emergency department visits, hospital-based outpatient procedures and some specialized tests that Quest Diagnostics may draw and send to UH for processing.

Quest Diagnostics says the acquisition “broadens access to its industry-leading and innovative test menu, network of convenient patient access

sites and broad health plan coverage in Ohio.” In July, the company announced plans to acquire the majority of outreach lab assets from Columbus’s OhioHealth, Crain’s sister publication Modern Healthcare reported.

Testing performed by Quest Diagnostics for UH providers and patients will occur at the company’s laboratories in Twinsburg and Pittsburgh, the company says.

Quest Diagnostics is headquartered in the U.S. and has operations in India, Ireland and Mexico. It has approximately 2,000 patient locations across the country, according to its website, and employs more than 50,000.

PEOPLE ON THE MOVE

ACCOUNTING

Zinner & Co.

ARCHITECTURE

Desmone

BANKING

Fifth Third Bank

BANKING

Fifth Third Bank

BANKING

PNC Bank

Zinner & Co. is proud to announce that Laura Haines, CPA, was named a Partner. Her expertise includes accounting, compilations, and reviews. Laura’s focus spans all industries. Her subspecialty areas include real estate, professional services firms, and medical practices. She started with Zinner as an intern, and moved on to hold different positions, most recently Accounting Tax Services Senior Manager. Laura has a bachelor’s and master’s degree in accounting from Kent State University.

FINANCIAL SERVICES

Ancora

We are happy to announce that Ryan Connolly has joined Ancora as a Senior Sales Executive on the Employee Benefits team. Prior to Ancora, Ryan worked in business development at Bravo Wellness, a subsidiary of Medical Mutual, building broker relationships and bringing in new accounts. He began his career at Maxim Health Information Services recruiting for the healthcare industry. Ryan earned a Bachelor of Science degree in marketing from The Ohio State University’s Fisher College of Business.

LEGAL

Hahn Loeser & Parks

Desmone welcomes Theodore Ferringer, AIA, to its Cleveland office. A Kent State graduate and Crain’s 40 Under 40 honoree, he brings expertise in urban design, multifamily, and adaptive reuse. Active in AIA leadership and sustainability advocacy, he enhances Desmone’s mission of creating impactful, communitycentered designs.

Fifth Third Bank has named Jessica Cuffia-Corlette as Senior Vice President, Commercial Middle Market Team Leader. In this role, she is responsible for managing a team driving the Bank’s growth in the commercial middle market space within Northeast Ohio. Jessica has 24 years of banking experience in commercial banking management and sales roles. She earned a bachelor’s degree from Mercyhurst University.

LEGAL

The Legal Aid Society of Cleveland

Hahn Loeser announced that Arthur Gibbs joined Christina Evans and Stephen Gariepy as National Co-Chairs of the Firm’s Estate Planning, Wealth Transfer & Preservation Practice. Gibbs’ addition supports the considerable national growth in HLP’s Trusts and Estates Practice. Gibbs is an Ohio State Bar Association Board Certified Specialist in Estate Planning, Trust and Probate Law. He focuses on providing estate, tax and business planning advice to business owners, individuals and non-profits.

The Legal Aid Society of Cleveland created a new wholly own subsidiary, Northeast Ohio Legal Aid, focused on policy advocacy with local governments to benefit people with low income living in Ashtabula, Cuyahoga, Geauga, Lake and Lorain counties. Attorney Katherine Hollingsworth is the inaugural executive director as of February 3. Katherine previously served as managing attorney of Legal Aid’s economic justice practice. Northeast Ohio Legal Aid’s board of managers are Rita Maimbourg (president), Steve Fazio (treasurer) and Vanetta Jamison (secretary). This new organization will work closely with attorneys at The Legal Aid Society of Cleveland on advocacy for systemic change.

Fifth Third Bank has named Lynda Nowak as Commercial Relationship Manager focused on companies in Akron, Canton and Youngstown markets. In this role, she is responsible for driving the Bank’s growth in the commercial middle market space within Northeast Ohio. Lynda brings over 30 years’ experience in commercial banking management and relationship building success. She is a graduate of Baldwin Wallace University with both her bachelor’s and master’s degrees.

LEGAL

Omid Shanizadeh

Asli joins PNC Bank as a healthcare business relationship manager. In his role, Omid is responsible for formulating and implementing financial solutions for diverse, privately owned healthcare enterprises, including medical and dental practices. As a trusted business advisor, Omid helps his clients accelerate patient payments, improve financial reporting and controls and strategically leverages business loans for practice growth.

MANUFACTURING

Singerman, Mills, Desberg & Kauntz Co., L.P.A.

Visual Marking Systems, Inc.

Singerman, Mills, Desberg & Kauntz Co., L.P.A., is pleased to announce that Cynthia K. Port has joined the firm as an Of Counsel attorney. Cyndi previously practiced at the Cleveland law firm of Hahn Loeser & Parks LLP. She is experienced in developing complex estate, corporate succession, and asset protection plans. She graduated from the University of Maryland, receiving her law degree, manga cum laude, from the Washington College of Law at American University.

Eric Kahle has been named President of Visual Marking Systems, Inc. (VMS), a third-generation, family-owned leader in custom-printed product identification, fleet graphics, and branded apparel. A Rochester Institute of Technology graduate, Eric joined VMS in 2008 and advanced through key roles, including Chief Revenue Officer. As President, he is focused on driving innovation, fostering growth, strengthening customer relationships, and continuing VMS’s 60-year legacy of excellence.

CrainsCleveland.com

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Classified sales Suzanne Janik (313) 446-0455 or sjanik@crain.com

Inside sales Tawni Sharp

CRAIN’S CONTENT STUDIO

Senior director of Crain’s Content Studio Kristin bull, (313) 446-1608 or kbull@crain.com

Crain’s Content Studio Manager Jennifer Keirn, jennifer.keirn@crain.com

PRODUCTION

Vice president, product Kevin Skaggs Product manager Tim Simpson Media services manager Nicole Spell Pre-press and digital production Craig L. Mackey CUSTOMER SERVICE (877) 824-9373 or customerservice@crainscleveland.com Reprints Laura Picariello (732) 723-0569 or lpicariello@crain.com

CANNABIS BEVERAGE REVOLUTION: Trends, Insights

and Emerging Opportunities

TUESDAY, FEBRUARY 25 | 1 P.M. ET

Dive into the fastest-growing segment of the cannabis industry – beverages. While regulated THC beverages are improving in taste and experience, hemp beverage sales are growing quickly and could outpace their regulated peers. Join our panel to discuss the growth, trends and future of cannabis beverages.

Sponsored by

MODERATOR:

Debra Borchardt

Executive Editor & Co-Founder Green Market Report

PANELIST: Mack Hueber President, ayrloom & Gen V Labs LLC CFO, Beak & Skiff

PANELIST: Liz Stahura

Co-Founder & COO BDSA