20100517-NEWS--1-NAT-CCI-CL_--
5/14/2010
3:59 PM
Page 1
$1.50/MAY 17 - 23, 2010
Vol. 31, No. 20
Supply chains hum as sales optimism rises
State plan for equal Medicaid payments riles nursing homes Currently, they’re able to bill for separate services
Manufacturers shipping larger quantities, see customers come back as signs point to revival
By SHANNON MORTLAND smortland@crain.com
Nursing homes across Northeast Ohio are racing against the clock. As time ticks away and the state’s biennial budget — which begins July 1, 2011 — draws closer, nursing homes are lobbying state legislators to change a plan to provide a new average Medicaid payment for services rendered at nursing homes. The plan initially was approved in House Bill 66 for the current biennium budget, but it must be approved again if it is to be implemented in the next budget bill, said John Alfano, president and CEO of Aopha, the association for Ohio’s nonprofit nursing homes. Under the state’s plan, nursing homes would receive a set Medicaid reimbursement per patient, rather than billing separately for various services as they do now, said Harvey Shankman, executive director of Eliza Bryant Village, a nursing home in Cleveland’s Hough neighborhood. Some nursing homes would lose money, while others would gain because the state plans to average out the costs for all of Ohio’s nursing homes, he said. As a result, some nursing homes might be forced to cut staff and services to reduce overhead, become part of a chain of nursing homes, or See HOMES Page 8
By DAN SHINGLER dshingler@crain.com
M
anufacturers finally are busy enough to keep companies in their own supply chains busy with steadier volumes than most have seen in more than a year and, in some cases, backlogs. That situation has a lot of companies running with less stress, fewer uncertainties — and more employees. But you don’t have to tell Chris Haas there has been a turnaround and a resurgence of confidence on the part of area manufacturers. As CEO of All Pro Freight Systems Inc. in Avon, he can see it on the floor.
FILE PHOTO/RUGGERO FATICA
Chris Haas, CEO of All Pro Freight Systems Inc. of Avon, says his warehouse is 70% full; a year ago, it was 70% empty.
Mill operates at 70% capacity; employment four times last summer’s level, when production stopped
20
The “new normal” in the steel industry might be taking hold on the banks of the Cuyahoga River, where ArcelorMittal’s Cleveland Works is seeing steadily increasing demand for its products — even if
See OPTIMISM Page 11
“(Technology, defense, and forging and industrial markets) have all shown signs of increasing demand, improving frequency of shipments and moving up due dates.” – Larry Fulton, CEO of Lefco Worthington, which makes pallets, crates and steel containers used in shipping
Signature flame burns bright — and often — at ArcelorMittal DAN SHINGLER dshingler@crain.com
Mr. Haas says his 600,000 square feet of warehouse space is about 70% full. A year ago, the space was 70% empty, as most customers that used All Pro to warehouse and eventually distribute their inventory decided they didn’t need inventory. What’s got Mr. Haas’ world rightside ’round, he said, is manufacturers’ belief they will sell their products, and that they’ll do it soon. As a result, they’re shipping him larger quantities of consumer-ready appliances, lawn equipment, plastic bottles and other materials that producers and retailers need throughout the supply chain. “We had one customer give us a
company officials do not yet see a time coming when demand will reach levels common before the economic crisis. “After a challenging 2009, we are now seeing signs of improvement in the economy and steel market,” ArcelorMittal spokeswoman Katie Patterson told Crain’s last week.
“However, the recovery remains slow and progressive.” The mill currently is operating at 70% of capacity, said Mark Granakis, president of United Steelworkers Local 979 in Cleveland, which represents workers at the mill. While that figure sounds far from where both Mr. Granakis and the company would like the mill to be — and it is — it’s at least a long way from the bottom hit in 2009. Last year, in the heart of the recession,
the mill was idled for the summer, and the familiar flame of its blast furnace visible to drivers passing by the mill was snuffed out for the first time in recent memory. Today, the flame is back and Mr. Granakis has about 1,070 members working at the plant, with two or three more called back each week, he said. When no steel was made last summer, he had only about 270 people doing maintenance work
INSIDE Know your Cleveland history? Prove it! As part of our 30th anniversary celebration, we test our readers’ Cleveland knowledge. ■ By how much did the Gateway District tax pass? ■ How much did Al Lerner pay for the Browns? ■ What year did The Cleveland Press cease publication? Take the quiz on Page 19 to test your skills.
See MITTAL Page 25
0
NEWSPAPER
71486 01032
6
SPECIAL SECTION
FINANCE Personal finances more often creeping into the workplace ■ Page 21 PLUS: CREDIT COUNSELORS ■ RESTAURANT IN A BANK ■ & MORE
CrainsCleveland.com/30thanniversary
20100517-NEWS--2-NAT-CCI-CL_--
2
5/14/2010
10:30 AM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
HARD AT WORK
COMING NEXT WEEK
Americans were extraordinarily productive at work in the first quarter of 2010, according to data from the U.S. Bureau of Labor Statistics. During the quarter, output in the nonfarm business sector increased 3.1% from the first quarter of 2009, while hours fell 3.0%, yielding an increase in productivity of 6.3%. This was the highest productivity gain since a 7.0% rise in the first quarter of 1962. Here’s a list of quarterly productivity gains since 1980 that exceed 5%. (As you’ll see, they’re exceedingly rare):
Crain’s 30th anniversary issue
Milton Maltz
To celebrate our 30th year, we profile 30 people who had a positive impact on the Greater Cleveland community. Also, relive the last 30 years by way of our books of lists and our “best of” compilations.
Change from corresponding quarter of previous year
Don Plusquellic
REGULAR FEATURES Best of the Blogs ..........27 Bright Spots .................15 Classified .....................26 E!Cleveland ..................16 Editorial .......................10
MAY 17-23, 2010
Going Places ................12 Milestones ...................27 Reporters’ Notebook ....27 Tax Liens .....................18 The Week.....................27
Quarter
Hours worked
Output
Output per hour
2010 Q1
-3.0%
3.1%
6.3%
2009 Q4
-5.6
0.3
5.6
2003 Q4
-0.3
4.7
5.0
2002 Q1
-4.1
1.7
6.1
1983 Q4
5.6
10.9
5.0
1983 Q3
2.8
8.3
5.4
SOURCE: U.S. BUREAU OF LABOR STATISTICS; WWW.BLS.GOV
700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 Phone: (216) 522-1383 Fax: (216) 694-4264 www.crainscleveland.com Publisher/editorial director: Brian D. Tucker (btucker@crain.com) Editor: Mark Dodosh (mdodosh@crain.com) Managing editor: Scott Suttell (ssuttell@crain.com) Sections editor: Amy Ann Stoessel (astoessel@crain.com) Assistant editors: Joel Hammond (jmhammond@crain.com) Sports Kathy Carr (kcarr@crain.com) Marketing and food Senior reporter: Stan Bullard (sbullard@crain.com) Real estate and construction Reporters: Shannon Mortland (smortland@crain.com) Health care and education Jay Miller (jmiller@crain.com) Government Chuck Soder (csoder@crain.com) Technology Dan Shingler (dshingler@crain.com) Manufacturing Arielle Kass (akass@crain.com) Finance and legal Research editor: Deborah W. Hillyer (dhillyer@crain.com) Cartoonist/illustrator: Rich Williams
weatherhead
Marketing/Events manager: Christian Hendricks (chendricks@crain.com) Marketing coordinator: Laura Franks (lfranks@crain.com) Advertising sales director: Mike Malley (mmalley@crain.com) Account executives: Adam Mandell (amandell@crain.com) Dirk Kruger (dkruger@crain.com) Nicole Mastrangelo (nmastrangelo@crain.com) Dawn Donegan (ddonegan@crain.com) Business development manager & classified advertising: Genny Donley (gdonley@crain.com) Office coordinator: Toni Coleman (tcoleman@crain.com) Production manager: Craig L. Mackey (cmackey@crain.com) Production assistant/video editor: Steven Bennett (sbennett@crain.com)
OUR LETTERS CARRY THE STRENGTH OF NUMBERS
Weatherhead’s Part-Time MBA program is ranked #14 in the nation. – BusinessWeek 2009, “Best Part-Time MBA Programs”
Weatherhead’s Executive MBA program is ranked #16 among schools in the United States. Worldwide, it’s ranked #21. – BusinessWeek 2009, “Best Executive MBA Programs”
To learn more about our highly-ranked Part-Time MBA and Executive MBA programs, visit weatherhead.case.edu
Graphic designer: Kristen Wilson (klwilson@crain.com) Billing: Susan Jaranowski, 313-446-6024 (sjaranowski@crain.com) Credit: Todd Masura, 313-446-6097 (tmasura@crain.com) Circulation manager: Erin Miller (emiller@crain.com) Customer service manager: Brenda Johnson-Brantley (bjohnson-brantley@ crain.com) 1-888-909-9111
Crain Communications Inc. Keith E. Crain: Chairman Rance Crain: President Merrilee Crain: Secretary Mary Kay Crain: Treasurer William A. Morrow: Executive vice president/operations Brian D. Tucker: Vice president Robert C. Adams: Group vice president technology, circulation, manufacturing Paul Dalpiaz: Chief Information Officer Dave Kamis: Vice president/production & manufacturing Kathy Henry: Corporate circulation/audience development director G.D. Crain Jr. Founder (1885-1973) Mrs. G.D. Crain Jr. Chairman (1911-1996) Subscriptions: In Ohio: 1 year, $59; 2 years, $102. Outside of Ohio: 1 year, $102; 2 years, $180. Single copy, $1.50. Allow 4 weeks for change of address. Send all subscription correspondence to Circulation Department, Crain’s Cleveland Business, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-888-909-9111 or FAX (313) 446-6777. Reprints: Call 1-800-290-5460 Ext. 136 Audit Bureau of Circulation
20100517-NEWS--3-NAT-CCI-CL_--
5/14/2010
3:20 PM
Page 1
MAY 17-23, 2010
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
3
Hillcrest’s $163M expansion starts to materialize
INSIGHT
Hospital’s new adult ER opens Tues. By SHANNON MORTLAND smortland@crain.com
JANET CENTURY
Pat Deluca, vice president and general manager of inorganics at OM Group, holds a beaker of submicron, high-purity cobalt powder the company produces as a performance-enhancing additive for electric vehicle battery systems.
Shifting into high gear Area manufacturers, startups fine-tune automotive products as demand accelerates for hybrid, electric cars
With a portion of its $163 million expansion and renovation initiative opening this week, Hillcrest Hospital in Mayfield Heights is trading in its 1968, dark brick façade for a 21st-century look of white stone and large windows. Hillcrest has added 304,000 square feet for a new bed tower with 72 private rooms, a Level III neonatal intensive care unit and a far larger emergency department — all of which were designed to include the white walls, glass and steel preferred by Cleveland Clinic CEO Dr. Delos “Toby” Cosgrove. Construction began two years ago and the first phase of the adult emergency department will open this Tuesday, May 18, with 22 private rooms. Twenty more adult rooms and 12 pediatric emergency rooms will open in December, said Sherry Aronson, Hillcrest’s chief operating officer. Like the rest of the hospital, the emergency department was designed for patient privacy. Picture a football field surrounded by a running track. The patient rooms lie on the outside track, where patients and their families can enter the rooms from a quiet hallway. “This environment allows you to walk into your patient room, seeing nobody else,” Ms. Aronson said. The other side of the patient rooms open to the “football field,” where physicians and nurses are working and checking on patients, she said. Each patient room has a glass wall and door so nurses and doctors can see in. None of the rooms face one another. See HILLCREST Page 24
By CHUCK SODER csoder@crain.com
P
at Deluca gets excited when he sees a Toyota Prius heading down the road. The popular hybrid electric car symbolizes opportunity for OM Group Inc., the company where he works, and for a lot of other manufacturers, chemical companies and startups in Northeast Ohio. Mr. Deluca said he and many of his colleagues in the advanced materials division of the Westlake-based specialty chemicals company know the nickel-metal hydride battery system used by today’s hybrids “very, very well.” The company already sells cobalt
RENDERING PROVIDED
Hillcrest Hospital is adding more operating rooms.
THE WEEK IN QUOTES “Our business is booming right now in a variety of end markets. I don’t expect the cycle of inventory replenishment to be finished until later this year.”
See CARS Page 25
— Chris DiSantis, CEO, Hawk Corp. Page One
Charter One makes investments amid deposit gains Bank bolstering ATM access, tech capabilities By ARIELLE KASS akass@crain.com
Charter One Bank is joining the fray of those financial institutions seeking to boost their market shares in this area. The bank, owned by The Royal Bank of Scotland Group, is investing more than $500 million in technological improvements throughout its 12-state footprint, hiring new bankers and adding about 1,000 ATMs at Sunoco convenience stores and elsewhere. It also won the right to be
the sole ATM provider at Cleveland Hopkins International Airport and Burke Lakefront Airport. Charter One’s Ohio president, Kenneth E. Marblestone, said he plans to bring on “a few dozen” new mortgage representatives in Northeast Ohio because he believes the bank can do a better job of covering the market. Mr. Marblestone said he also has added commercial bankers and some individuals in the bank’s notfor-profit health care group. “The market has brought lots of opportunities,” he said. “There is no ‘best bank’ in town. There is no clear winner.” Mr. Marblestone said Charter One has seen a steady increase in deposits in the Cleveland-Elyria-Mentor metropolitan
statistical area, to $5.1 billion as of June 30, 2009, from $4.1 billion a year earlier, and it intends to continue growing. The bank is fourth in the state in deposits and has seen a 251% increase statewide in its middle-market commercial lending book, according to Mr. Marblestone. Problems faced by Charter One’s parent company, which last week announced layoffs of 2,600 in the United Kingdom, do not affect the local bank, Mr. Marblestone said. He said the only impact The Royal Bank of Scotland has on Charter One is a positive one, as it allows Charter One to sell global products. Ellen Alemany, chairman and CEO of Citizens Financial Group Inc. — the U.S. See BANK Page 8
“As each year went by, the green, renewable aspects of what we were doing became a strong wind as opposed to a light breeze at our backs.” — Rocco Di Lillo, chairman, Advanced Hydro Solutions LLC. Page 4.
“The theory is if an employee is getting into a more desperate financial situation, he’s more inclined to do something inappropriate at work.” — Peter Hardin-Levine, president of the Cleveland law firm Thorman & Hardin-Levine. Page 21
20100517-NEWS--4-NAT-CCI-CL_--
4
5/14/2010
CRAIN’S CLEVELAND BUSINESS
2:05 PM
Page 1
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
Fairlawn firm set for dam work Advanced Hydro Solutions tapped to equip Pa., W. Va. barriers with hydroelectric generators By CHUCK SODER csoder@crain.com
A Fairlawn company is about to embark on a $125 million effort to equip a dam in Greater Pittsburgh and three in West Virginia with hydroelectric generators. Advanced Hydro Solutions LLC in late April signed a deal to receive an undisclosed amount of capital for the projects from CapitalWorks LLC, a Cleveland private equity firm. That money, combined with more funds the company already raised, should
be enough to get Advanced Hydro to the point where it can secure traditional bank financing to cover the rest of the cost of the projects, said chief financial officer Cliff Phillips, one of the three founders of the company. Advanced Hydro expects this summer to receive a federal license that will allow it to begin construction of a generator at a Pittsburgh-area dam. The company soon plans to apply for a license at a second dam, near Justice, W. Va., and it expects to receive it in about a year, according to chairman Rocco Di Lillo and pres-
ident David Sinclair, the other two founders. It plans to contract out the construction work. The company already has done several environmental and engineering studies on the four sites. So far, conclusions from the studies have been positive, Mr. Sinclair said. “We’ve not found any rare, endangered species or anything that would impede the projects,” he said. CapitalWorks liked Advanced Hydro’s focus on renewable energy, given the government’s desire to make the country less reliant on fossil fuels, said firm president Dick Hollington. The investment was particularly appealing, he said, because hydroelectric power is among the more affordable sources of renewable energy, and because Advanced Hydro already had completed much of the necessary regulatory work. Obtaining a license often requires four or five years of studies. “The biggest challenge for hydro is the regulatory process,” he said. Besides the money from CapitalWorks, Advanced Hydro has raised capital from about 20 local individual investors, Mr. Di Lillo said. Its founders put in money as well, Mr. Phillips added. He would not disclose the total amount raised. The four dams are expected to have the capacity to generate 58.3 megawatts of electricity. Advanced Hydro also has sold rights to develop hydroelectric generators at two other dams, one near Sutton, W. Va., and another near Wilkesboro, N.C., and remains involved with those projects. The founders decided to pursue such projects six years ago, well before the recent push for more sources of renewable energy. Current trends, however, have played to the company’s advantage, Mr. Di Lillo said. “As each year went by, the green, renewable aspects of what we were doing became a strong wind as opposed to a light breeze at our backs,” Mr. Di Lillo said. The group wanted to install hydroelectric generators, which use turbines to turn the energy of rushing water into electricity, because they are a more reliable, cheaper source of renewable power than wind and solar energy. The generators last several decades, rarely need maintenance and cost little to operate, Mr. Sinclair said. Hydroelectric power is reasonably affordable, but has limitations, said Fred Mayes, senior technical analyst with the U.S. Energy Information Administration. While some hydroelectric projects have merit, there is only so much opportunity to install new generation capacity, Mr. Mayes said. Studies by his agency indicate hydroelectric power generation capacity will grow to 297 billion kilowatt-hours in 2015, up 15% from 257 billion kilowatt-hours today. However, that figure is expected to level off afterward, mainly because of strict licensing regulations and environmental concerns that in some cases are leading to the deconstruction of dams. ■
Volume 31, Number 20 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of May and fifth week of May, the fourth week of June and first week of July, the third week of December and fourth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright © 2010 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, and at additional mailing offices. Price per copy: $1.50. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. (888)909-9111. REPRINT INFORMATION: 800-290-5460 Ext. 136
20100517-NEWS--5-NAT-CCI-CL_--
5/14/2010
2:51 PM
Page 1
MAY 17-23, 2010
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
5
Tech startup duo catches publishers’ eyes with digital book idea Sideways duo aims to plug all multimedia into new kind of software
“(Publishers) understand that we’ve spent much of our working lives concerned with the publishing industry.�
“In some ways we don’t know where we’re going because it’s experimental.� – Charles Stack, CEO, Sideways LLC, and serial technology entrepreneur
– Eliza Wing, president and chief operating officer, Sideways, and former CEO of Cleveland.com
By CHUCK SODER csoder@crain.com
Charles Stack and Eliza Wing want to reinvent the book. That was the goal they set back in October when they first discussed plans to create Sideways LLC, a Cleveland company that aims to write a new chapter in the history of reading. It’s a bold plan, for sure. Devices such as the iPhone and the iPad, however, make it possible to blend in video, pictures, questionnaires and even databases of information among the text of digital books, all in a portable format. Plus, the ability of such devices to access the Internet means a book need not be limited to a set number of pages. And publishers know it, said CEO Charles Stack, who has started and sold multiple information technology companies. They don’t want to end up blindsided by technology like the music industry was when people started downloading songs online, a sentiment that has helped Mr. Stack and Ms. Wing get meetings with top publishers. “The book industry is paying much more attention,� Mr. Stack said. It also doesn’t hurt that Mr. Stack and Ms. Wing have publishing backgrounds. Mr. Stack in 1992 started Book Stacks Unlimited, which sold books online via Books.com. It was acquired in 1996 and is now part of Barnes & Noble. Ms. Wing in April announced that she was leaving her position as CEO of Cleveland.com, the web site of The Plain Dealer, to become president and chief operating officer at Sideways. She previously worked with Mr. Stack as editorial director at Books.com. “(Publishers) understand that we’ve spent much of our working lives concerned with the publishing industry,� Ms. Wing said. Sideways employs about 15 people at its offices in Cleveland’s Theater District. Many of them worked for iNomadics, Mr. Stack’s mobile software development company, which for the most part has been folded into Sideways. The company intends to hire 10 more employees in June, including several interns, Mr. Stack said.
to point the reader to information about related events that happened within a few miles of the reader’s location. “The Internet can become your canvas for storytelling,� Mr. Stack said. The company, which is financed by its founders, also has developed a piece of software designed to help authors promote their books and
engage with fans, as well as a few of its own all-digital magazines. TapTilt, for example, is an iPhone-optimized publication for iPhone fans, and iPadia is a similar publication targeting iPad users. Mr. Stack said one of Sideways’ strategies is to put some of its developers and graphic designers in a room and have them come up with other ways to improve on the
book. It’s too hard to plan out a more detailed long-term strategy than that, given how much change the industry is going through. “In some ways we don’t know where we’re going because it’s experimental,� Mr. Stack said. OverDrive Inc. of Valley View also sees opportunity in the digital publishing space, said CEO Steve Potash. The company, which dis-
tributes audiobooks, digital books, music and video, has created software programs allowing its digital books to be read on several different smart phones. Mr. Potash said he is glad that the idea of digital books seems to be gaining momentum. “This is all just good news for everyone in the digital space,â€? he said. â–
'REATüTHINGSüHAPPENüWHENüü YOUüMEETüATüAü&AIRMONT For more than a century, Fairmont Hotels & Resorts has brought people face to face for legendary meetings in unforgettable settings. Whether you’re looking to make history or simply to offer your clients an unrivaled experience, trust Fairmont to deliver seamless service, state-of-the-art meeting spaces and top value—making your work that much easier.
&ORĂĽMOREĂĽINFORMATION ĂĽĂĽ PLEASEĂĽCALLĂĽ ĂĽ ĂĽ ĂĽ ĂĽ E MAILĂĽMEET FAIRMONT COMĂĽĂĽ ORĂĽVISITĂĽFAIRMONT COM
ov e r a c e n t u ry o f l e g e n da ry m e e t in g s
Electronic canvas Sideways has developed a software platform called M3, which can be used to create books that take advantage of the multimedia capabilities of smart phones and tablet computers. The company will license the platform to publishers and use it to create its own digital content. Sideways plans to start by targeting books that would benefit most from the technology. For instance, digital cookbooks could guide users to recipes by asking them what types of foods they’re hungry for or what ingredients they want to use. Animation could be added to graphic novels and comic books. And field guides might use the global positioning system technology available in many new devices. Books could link the reader to information on the Internet as well, Mr. Stack said. He described how a book on the Civil War might be able
World War II Conferences of the Allies at Fairmont Le Château Frontenac, QuÊbec, 1943–1944
Drafting the United Nations Charter at The Fairmont San Francisco, 1945
John Lennon and Yoko Ono’s Bed-in for Peace at Fairmont The Queen Elizabeth, MontrÊal, 1969
G7 International Economic Summit at Fairmont Le Château Montebello, QuÊbec, 1981
Photo: Fairmont Heliopolis & Towers, Cairo
20100517-NEWS--6-NAT-CCI-CL_--
6
5/14/2010
2:30 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
Brown: More energy tax breaks needed Renaissance spruces Assistance would help domestic manufacturers compete with Chinese By DAN SHINGLER dshingler@crain.com
U.S. Sen. Sherrod Brown wants the federal government to shell out more money for the Advanced Energy Manufacturing Tax Credit, also known as the 48C program. The Democratic senator from Avon last week introduced legislation that would expand support for the program with an additional $5 billion in tax credits and possibly grants for companies investing in wind, solar and other advanced energy technologies. American industry needs the incentive and assistance to help it gear up to better compete with China and other nations that already are pulling ahead in the race to produce
the world’s solar panels, wind turbines and other equipment, Sen. Brown said in a conference call last Wednesday, May 12, from Washington, D.C. “Some 70% of the components of clean energy systems are made outside Brown of the U.S. So, if we don’t act, we’ll replace our dependence on foreign oil with dependence on foreign solar and foreign wind power” equipment, Sen. Brown said. The 48C program had been financed with $2.3 billion in federal stimulus money, but that money has run out, said Jared Bernstein, an economic policy adviser to the Obama administration who joined Sen. Brown in discussing the legislation on the conference call. That money attracted more than $5.4 billion in private investment and helped create 17,000 manufacturing jobs, Mr. Bernstein said. In addition to expanding the pro-
gram financially, Sen. Brown said his legislation would enable some of the money to be spent in the form of grants. He said grants would better assist young companies, which often don’t produce profits, than would tax credits. Greg Noethlich, chief operating officer of Elyria Foundry, said he hopes the program is expanded so his company can receive tax credits, which would enable it to modernize its facilities in both Elyria and western Pennsylvania. Mr. Noethlich said the existing program ran out of money before the company was approved for a tax credit. “There’s over 30 tons of ductile steel in a wind turbine and those are components we can help supply,” Mr. Noethlich said. Sen. Brown said he hopes the bill will pass soon, as there is broad support for it in the Senate and President Obama backs it. ■
Recovery Isn’t Simply a Goal, It’s Our Mission.
up most visible areas Public Square hotel’s facelift includes redone bar By STAN BULLARD sbullard@crain.com
Aside from installing a few planters that are on their way, workers have just finished a multimilliondollar renovation of the lobby, bar and key hallways of the landmark Renaissance Cleveland Hotel. “The Ambassador Room got a complete redo,” said Gary McGauley, general manager of the 491-room hotel at 24 Public Square in downtown Cleveland. “Paint, new carpets and new window treatments. You really have to see it.” Painters redid detailed frescos, covering the upper walls of the room with a fresh coat of stark white paint. The effect amps up the contrast with freshly painted tan walls that emphasized craftsmanship dating from the hotel’s 1918 opening. In the lobby seating area surrounding a fountain and in the adjoining bar, new furnishings with reds and yellows have replaced older blue couches and chairs. Plush carpet went in from the Superior Avenue lobby through the first floor and the mezzanine, including second-level meeting rooms. “We gave it a contemporary finish and kept the classic aspects,” Mr. McGauley said of the updates. Most extensive of the improvements is a nearly total redo of the Brasserie restaurant, where the
“People putting their own money at risk is a great sign. ... You don’t do that unless you think the market is going to rebound.” – Dennis Roche, president, Positively Cleveland hotel gutted the dated ’70s brass rails and wall coverings. New tile, oak woodwork, granite tabletops and panels with contemporary artwork give the 120-seat restaurant the look of a bistro. “We only kept one thing from the old Brasserie,” Mr. McGauley said: a collection of sepia-toned photos of Cleveland sports teams and landmarks, including a picture of the hotel — before the landmark Terminal Tower went up on its southeastern corner. Dennis Roche, president of Positively Cleveland, the region’s convention and visitors’ bureau, said he was glad to see the owners of Renaissance “investing in the future.” “People putting their own money at risk is a great sign because you don’t do that unless you think that the market is going to rebound,” Mr. Roche said. As Renaissance is the largest hotel in downtown Cleveland, it’s a signature property for downtown, Mr. Roche said, so the investments are particularly important. ■
Taking care of business. Pet waste contains millions of bacteria that pollute our lake and streams. So pick it up, pitch it in the trash, and protect our environment. Because it’s the right thing to doo.
Kindred Healthcare understands that when people are discharged from a traditional hospital, they often need continued care in order to recover completely. That’s where we come in. Kindred offers services including aggressive, medically complex care, intensive care, shortterm rehabilitation and compassionate longterm care for dementia or Alzheimer’s.
Doctors, case managers, social workers and family members don’t stop caring simply because their loved one or patient has changed location. Neither do we.
Come see how we care at www.continuethecare.com.
Dedicated to Hope, Healing and Recovery
CONTINUE THE CARE Northeast Ohio Regional Sewer District LONG-TERM ACUTE CARE HOSPITALi © dkhi_d] WdZ h[^WX_b_jAT_ed Y[dj[hi © Wii_ST[Z b_l_d] Y[dj[hS
wheredoesitgo.org/pup
20100517-NEWS--7-NAT-CCI-CL_--
5/13/2010
9:53 AM
Page 1
HOW GOOD IS A COMMUNICATIONS COMPANY IF IT DOESN’T HEAR YOU? At Time Warner Cable Business Class, we really listen. It’s the foundation of our whole relationship with you. Our local representative will first spend time understanding your business and the way you communicate, then design a unique solution that can help you be more productive than you ever thought possible. Call us at 1.877.615.4332. When we say, “We hear you,” it’s a promise.
1.877.615.4332 | TWCBC.COM
Internet | Phone | Cable TV | Ethernet Products and services not available in all areas. Some restrictions apply. Time Warner Cable Business Class is a trademark of Time Warner Inc. Used under license. © 2010 Time Warner Cable, Inc. All rights reserved.
20100517-NEWS--8-NAT-CCI-CL_--
8
5/14/2010
3:49 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
Homes: No incentives to upgrade service, facilities in plan continued from PAGE 1
close their doors altogether, predicts William Pattie, a shareholder at Cleveland accounting firm Maloney + Novotny LLC, which works with local nonprofits. “Small operations — those with 50 beds or less — are either going to have to merge with others or they will go out of business,� Mr. Pattie said. “The strong will survive — those with multiple facilities with economies of scale. “I think there are a lot of operations that will probably be willing to entertain selling,� Mr. Pattie added. “Will they get a good price in this market? Probably not, but it’s better than closing or losing your facility to the bank.�
Those that likely would be at the greatest disadvantage under the new plan are nursing homes that provide more patient services and that spend money to upgrade their locations because the new payment system wouldn’t reward for such efforts, said Mark Weiss, chief financial officer of Montefiore nursing home in Beachwood. For example, Mr. Shankman said the population Eliza Bryant serves is almost all African-Americans, who have a higher rate of kidney failure. About 10 to 12 residents need kidney dialysis several times a week off site, and it can be expensive to transport them back and forth, he said. Eliza Bryant now is able to bill Medicaid separately for that service,
a practice that would end under the new single payment system, Mr. Shankman said. Many other necessities, such as portable oxygen and wheelchairs, also would need to be paid for under the single payment from Medicaid, he said.
Alternative offered up Gov. Ted Strickland initially proposed implementing the single Medicaid payment system in the current biennium, which would have caused St. Augustine Manor, a Cleveland nursing home, to lose about $1 million a year, said Patrick Gareau, CEO of St. Augustine. Because the Legislature delayed implementation of the single Medicaid payment system until July 2011,
nursing homes have some time to convince lawmakers to restructure the plan. Aopha, the professional association, is leading that charge. The group has devised a plan that would reward nursing homes for maintaining certain quality measures and improving their buildings, Mr. Alfano said. “There’s got to be something more substantial to incent providers to provide some level of quality,� he said. “Right now, the incentives are all financial. There are no incentives for quality and there are no incentives for anybody to do anything to their buildings.� The proposal, Montefiore’s Mr. Weiss said, would not cost the state additional money that, with a poten-
3D3@G 0CA7<3AA 6/A / AB=@G B3:: CA G=C@A Â&#x2014; ÂľES caSR b] QOZZ ]\S ]T ]c` e]`Ya^OQSa ¡BVS :Oc\R`g @]][ ¸ ^`]POPZg PSQOcaS Wb eOa bVS ZOc\R`g `]][ ES VOR O `cZS( <] Q]\TS`S\QS QOZZa Rc`W\U bVS a^W\ QgQZS BVO\YTcZZg eS¸`S U`]eW\U O\R []dW\U W\b] O \Se a^OQS \Sfb eSSY Âś
tial $9 billion budget gap in the next biennium, it doesnâ&#x20AC;&#x2122;t have. â&#x20AC;&#x153;Take the rates and rearrange the system so providers who do a good job quality-wise will get more money,â&#x20AC;? Mr. Weiss said.
Lobbying effort in gear Mr. Alfano said Aopha also hopes to convince state lawmakers to change the way the state is split into different categories of peer groups. Cleveland nursing homes now are put into a group with those in Columbus, Dayton and Toledo, while the other two groups consist of Greater Cincinnati and the rest of the state, Mr. Alfano said. He would like for state legislators to rearrange the groups and consider the cost of living and fair wages in each of those areas when determining reimbursement rates. While Aopha continues to lobby state legislators, individual nursing homes also are pleading their case in Columbus and Washington, D.C. Mr. Weiss said Montefiore will make more frequent trips to the Statehouse in the coming months and will continue to invite Ohio legislators to Montefiore to help them understand the services seniors need. So far, state lawmakers have been receptive to Aophaâ&#x20AC;&#x2122;s plan, but Mr. Shankman admits the battle will be tough to win. â&#x20AC;&#x153;You always have to be optimistic but itâ&#x20AC;&#x2122;s going to be a real challenge,â&#x20AC;? he said. â&#x20AC;&#x153;The state has significant budget issues. Weâ&#x20AC;&#x2122;re just hoping some people (with the most need) will be recognized.â&#x20AC;? â&#x2013;
Bank: New tech add-ons increase selling capability continued from PAGE 3
/b 4WTbV BVW`R 0O\Y SdS`g PcaW\Saa PO\YW\U `SZObW]\aVW^ PSUW\a eWbV O Q]\dS`aObW]\ EVS`S g]c R] []ab ]T bVS bOZYW\U O\R eS ZWabS\ BVS\ ]\QS eS c\RS`abO\R g]c` PcaW\Saa O\R g]c` \SSRa eS USb b] e]`Y /\R Oa eS PcWZR g]c` Âż\O\QWOZ a]ZcbW]\a eS [OYS ac`S b] YSS^ g]c W\d]ZdSR 0SQOcaS acQQSaa W\ PcaW\Saa Wa `O`SZg OQVWSdSR OZ]\S
:Sb¸a VOdS O Q]\dS`aObW]\ Ab]^ W\ g]c` Z]QOZ 4WTbV BVW`R 0O\Y QOZZ ca Ob &%% !!! #"' ]` dWaWb #! Q][ 4WTbV BVW`R 0O\Y ;S[PS` 4271
arm of Royal Bank of Scotland â&#x20AC;&#x201D; and RBS Americas, said Charter One is launching a new marketing campaign called â&#x20AC;&#x153;Good Banking is Good Citizenshipâ&#x20AC;? as it tries to show the bankâ&#x20AC;&#x2122;s aspirational side. â&#x20AC;&#x153;If our community prospers, our business prospers,â&#x20AC;? Ms. Alemany said. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re in a very good market position in Cleveland. We want to grow it.â&#x20AC;? Ms. Alemany said the bankâ&#x20AC;&#x2122;s focus on rewarding customers for saving for college or eliminating paper statements is Charter Oneâ&#x20AC;&#x2122;s way of â&#x20AC;&#x153;walking the talk.â&#x20AC;? But in addition to those products, Charter One is investing in improvements. Those include $130 million for new branch technology, including direct imaging for checks. The technology will allow for more cross-selling opportunities, Ms. Alemany said, and will be paired with a credit system that will preapprove credit requests for less than $500,000. The bank also is upgrading its online banking system and its cash management system. The improvements will be rolled out across the footprint over a three-year period. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s a lot of investment,â&#x20AC;? Ms. Alemany said. â&#x20AC;&#x153;We want to be the best regional bank. Our goal is to keep increasing our share in the market.â&#x20AC;? The hiring of former National City and PNC executive Dennis A. Devine, the executive vice president and director of retail banking for Citizens Financial Group in Cleveland, is an indication that the bank is committed in this area, Ms. Alemany said. â&#x2013;
20100517-NEWS--9-NAT-CCI-CL_--
5/13/2010
9:43 AM
Page 1
MAY 17-23, 2010
WWW.CRAINSCLEVELAND.COM
CRAIN’S CLEVELAND BUSINESS
9
PVF Capital pleases regulators with elevated capital levels Solon bank’s new management untangles itself from cease-and-desist orders and non-performing assets By ARIELLE KASS akass@crain.com
Bob King, president and CEO of PVF Capital Corp. and Park View Federal Savings Bank in Solon, wants you to know that his is a good news story. The bank and its holding company, which received federal cease-and-desist orders from the Office of Thrift Supervision last October, have raised capital and now exceed regulators’ requirements. They have a King new management team, Mr. King included, that is focused on reducing the bank’s non-performing assets and maintaining its profitability. And they have seen what he called “a modest improvement” in asset quality. “In our view, we’ve taken failure off the table,” Mr. King said. “The regulators, I believe, are very pleased with our capital raise.” The bank closed a $30 million stock offering — which was oversubscribed — in March. That’s on top of two deals that exchanged $20 million in trust preferred securities for cash, stock and warrants, resulting in a pre-tax gain of $17.6 million. Those moves increased PVF’s
capital levels above regulators’ requirements, to an 8.23% Tier 1 capital ratio and a total risk-based capital ratio of 12.19%. Regulators asked those ratios be at 8% and 12%, respectively; in the quarter prior to receiving the cease-and-desist orders, the figures were 6.54% and 10.03%. Charlie Crowley, managing director of investment banking in Cleveland for Stifel Nicolaus & Co., said the added capital gives the management team “breathing room and flexibility.” His firm helped with both the trust-preferred securities exchange and the stock sale. “They’ve taken some very decisive steps to get things back in a very positive direction,” Mr. Crowley said. “There’s no quick fix for the level of non-performing assets the bank has, but they’re breathing quite a bit easier now.” Mr. King said the bank still is “not out of the woods.” Regulators would need to revoke their orders for that to be the case, and they have given no indication of any time frame for doing so. In addition, the bank still has asset quality problems to work through. But Mr. King said the
successful infusion of money has “vindicated” his decision to come on board and took away the need for the regulators to make an immediate judgment about the bank’s viability.
A ‘fixable’ situation For all the trouble that Park View and PVF have faced, Mr. King said the bank’s problems are “pretty welldefined,” which is the reason the former president and CEO of Fifth Third Bank in Northeastern Ohio chose to come on board. “The problems in this institution, while significant, were fixable,” he said. The bank must lower its levels of bad loans and other non-performing assets to no more than 50% of its total capital plus reserves; Mr. King said there is still a long way to go. Non-performing assets must be reduced through sales or workout arrangements; Mr. King said the company is seeing “very positive results” from the individual who manages real estate owned by the bank and that the company has been reorganized to put resources toward continuing to work down those assets. The pace is slower than he would like to see, Mr. King said, but working through the bank’s challenges “isn’t magic.”
In Bob he trusts Fred Cummings, president of Elizabeth Park Capital Management in Beachwood, said the bank’s priority
“They’ve taken some very decisive steps to get things back in a very positive direction. There’s no quick fix for the level of non-performing assets the bank has, but they’re breathing quite a bit easier now.” – Charlie Crowley, managing director of investment banking in Cleveland, Stifel Nicolaus & Co. is to reduce its non-performing assets. Mr. Cummings, who invested in the bank’s rights offering, said he has “full faith and confidence” in Mr. King, who he said has a great reputation in the industry. “People believe Bob King can get this thing turned around,” he said. “He’s one of the best operators around.” Mr. King described his mentality as dealing with a “good bank” and a “bad bank” under the same roof. While some employees work toward resolving Park View’s problems, others are setting the infrastructure for growth. Mr. King envisions a broader penetration in the retail market — Park View has 17 branches now, in “high-quality ZIP codes,” he said — along with a “base of constituents who are very interested in seeing Park View succeed.” Private banking and a greater focus on small business lending may be part of Park View’s mix as the bank evolves, said Jim Nicholson, chief financial officer of the company and the bank. Mr. Crowley said the leadership team is experienced and “capable of
running a bigger and better bank.” He called its work so far “a great success story.” “It should put them in a position where they can control their own destiny,” he said.
Fighting the vortex Mr. King said he has viewed 2010 as the year to fix the bank’s challenges and 2011 as the year he moves Park View forward. “Our mission is to save and resurrect an important institution in Northeast Ohio,” he said. “I don’t think I appreciated the nature of the vortex until I sat in the middle of it. The biggest challenge is managing against the downward spiral.” The bank still has a “limited ability” to put its capital to work because it cannot increase its risk profile, Mr. King said. But Park View is sitting on $130 million it is waiting to redeploy, and the capital raised by the company gives the bank options as it moves forward. “At the end of the day, it gives us the ability to manage our way through this,” Mr. King said. “It puts us in a position to succeed instead of fighting off failure.” ■
20100517-NEWS--10-NAT-CCI-CL_--
10
5/13/2010
3:53 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
PUBLISHER/EDITORIAL DIRECTOR:
Brian D. Tucker (btucker@crain.com) EDITOR:
Mark Dodosh (mdodosh@crain.com) MANAGING EDITOR:
Scott Suttell (ssuttell@crain.com)
OPINION
CRAzy good
F
orefront, a magazine produced by the Federal Reserve Bank of Cleveland, isn’t usually on our list of recommended reading. However, bankers, members of our congressional delegation and heads of community groups in neighborhoods decimated by foreclosures would do well to read the cover story in the latest issue of what the Cleveland Fed calls its “showcase of policy ideas.” The story details a proposal by researchers at the Cleveland Fed to tweak the decades-old Community Reinvestment Act in a way that would increase banks’ incentive “to provide community groups with loans, services and investments that support neighborhood recovery efforts.” It is an interesting proposition, especially because the act known by the acronym CRA usually doesn’t generate warm, fuzzy feelings among bankers. As the story outlines, CRA rules dictate that banks must meet the credit needs of people who live in the areas they serve. The rules were put in place to give some assurance that banks wouldn’t just take deposits from people in low-income areas where they operate branches, but would loan money to customers in those neighborhoods, too. As a result, the story states, CRA examinations by regulators “put heavy emphasis on lending activities” in those neighborhoods in determining whether a bank receives satisfactory marks for compliance with the act. The idea put forth by Cleveland Fed researchers is to allow a bank to earn an “outstanding” CRA rating if it plays a significant role in rehabilitating and disposing of foreclosed properties in any lowerincome census tract nationwide. To be sure, a bank still would need to fulfill certain lending requirements in the communities it serves directly. However, it essentially could amass “extra points” for lessening vacancy and abandonment problems in any neighborhood in the country where those problems exist. “Examples might include (extending) credit lines to community groups that are engaged in rehabilitating and disposing of vacant properties or donating them to land banks,” the story states. The beauty of the proposal, in the view of the researchers, is that it would give banks the flexibility to put their swollen portfolios of vacant houses to positive community use while providing the hardesthit housing markets with the extra help they need. And it’s help that could come from a distant bank that otherwise might not have thought to extend a hand. “While we don’t expect our proposal to singlehandedly solve the vacancy and abandonment problem, we do think it could have a material impact,” said O. Emre Ergungor, senior research economist with the Cleveland Fed and author of the proposal. The Cleveland Fed already is getting this idea in front of bankers and community groups to gauge their reaction and plans to use the feedback to refine the proposal. In our view, this process shouldn’t drag out too long because the time to have implemented an idea such as this one is yesterday.
FROM THE PUBLISHER
Plenty of noise, not much substance
W
hy is it that when we need the now-failed Lehman Bros. investment political leaders the most bank. The governor must think such they are so very hard to attacks will help paint his former U.S. find? House of Representatives colleague as Gov. Ted Strickland knows this will be just another greedy Wall Street type in a tough year for him and just about any the eyes of Ohio voters. incumbent governor. He and the General As shallow as it is, that’s what happens Assembly have plugged the many holes in politics, especially if you’re running in Ohio’s budget with one-time scared. Mr. Kasich called the federal money that really was BRIAN comments “pathetic.” Of course, intended to save our economy TUCKER Mr. Kasich knows all too well — and the world’s — from the what pressure Gov. Strickland abyss. is under. It’s never good to be So instead of plowing the an incumbent anything when a money into critically needed big chunk of your voters are out infrastructure projects that could of work or have lost their houses help the Buckeye State regain to foreclosure. an economic edge, the governor The Kasich campaign hasn’t and lawmakers used the funds said much about specific plans to fill the holes in the budget, (other than his mysterious proretain or rehire teachers, and launch an posal to do away with the state income ill-advised, slow-speed rail line between tax), and that probably means his polls Cleveland, Columbus and Cincinnati. show he’s leading. So the challenger can And now the governor, feeling the play “rope-a-dope” for a while and offer heat from Republican challenger John few specifics while absorbing body blows Kasich, has launched an attack on his and landing the occasional counter punch. opponent for Mr. Kasich’s time spent at Neither man is exemplary in this
campaign so far. Gov. Strickland has been unimaginative and now a bit shrill, which doesn’t suit a man of the cloth and trained psychologist. My guess is that last week’s speech was cooked up by a campaign strategist, and Gov. Strickland went along with it. It’s too bad; that style doesn’t suit him. Mr. Kasich has attempted to downplay his work at Lehman, which included arranging a meeting between the firm and representatives of the Ohio Police and Fire Pension Fund and the Ohio Public Employees Retirement System. The funds’ officials chose to invest in Lehman funds that eventually lost nearly a half-billion dollars. How about this approach instead? “I was hired because of my political connections and I did what I was hired to do — set up a meeting. It was the pension fund officials’ responsibility to make investment decisions.” But that would be too much like the unvarnished truth, which makes politicians uncomfortable. So who’s the real winner in this fall’s gubernatorial election — the loser? ■
AND COUNTING ... What has been the region’s best or most important retail development in the last 30 years?
Crain’s Cleveland Business is celebrating its 30th year as Northeast Ohio’s premier source of business news with a special double issue, which will feature profiles of the 30 most influential Clevelanders. We also are reflecting on the most memorable events of the past 30 years with weekly polls — some of which can be found in this space — trivia questions, online content and video interviews. You can get in on the fun by visiting Crains Cleveland.com/30th anniversary.
MEGAN SWANSINGER
JEN PAGE
MARGARET STANARD
Cleveland (Tremont)
Cleveland (Downtown)
Rocky River
I would say Crocker Park; that’s where I would go to most. Or the cool little shops on Detroit Shoreway. Those are cool, sort of little funky stuff.
I’m not a fan of Crocker Park or Legacy (Village), so I don’t know what I’d say. Steelyard Commons is convenient because I live downtown. … I think Cleveland has a big retail deficit.
I’d have to say when (Tower City Center) opened. I’ve been downtown since ’79/’80. And I remember the Galleria opening, but I’d have to say (Tower City) going in, that was the most phenomenal.
20100517-NEWS--11-NAT-CCI-CL_--
5/13/2010
2:39 PM
Page 1
MAY 17-23, 2010
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
11
Optimism: Growth to continue through year continued from PAGE 1
75-truckload order last week,” Mr. Haas said in an interview earlier this month. “They can’t make 80 truckloads the week before they need to deliver them, so they start making them and warehousing them.” Mr. Haas, along with most of America, has been waiting for the signs of a real comeback for more than a year. He said he has a unique vantage point from his perch atop a company that operates warehouses and trucks. “When the economy is flowing, trucks are flying around and the warehouses thin out. When things dip, the warehouses fill up at first, because no one wants to let people go and they keep manufacturing,” Mr. Haas said. “That happened (in late 2008), then in 2009 people said, ’This is real,’ and stopped stocking inventory. Now it’s going the other way.” Larry Fulton has a similar perspective on broad-based manufacturing activity as CEO of Lefco Worthington, a Cleveland company that makes pallets, crates and steel containers that manufacturers use to ship their goods. Like Mr. Haas, Mr. Fulton said business has picked up to a brisk and steady pace.
twice, because you put it off and have to do more.” Mr. Peplin added, “We had always thought that (our business) was recession-proof, but it turns out it wasn’t in the big recession. We’d never seen a dip in (building maintenance products) in 23 years.” But at the end of the dip was a flood of business, which has created quite a fire drill at Talan. Its budgeting for 2010 was built around expectations that it would do about twothirds of the volume it did in 2008; but after starting the year as expected, sales jumped in April, when they were 70% above what the company had projected and Talan had its best month ever, Mr. Peplin said. The company now runs its presses 20 hours a day, five days a week, with an additional 12-hour run on Saturdays. “We can’t make parts fast enough; as fast as we make them they go out the door,” Mr. Peplin said. “It was like the dam broke for us.”
Finally, good surprises Other companies also are seeing new business as customers restock inventories, even in sectors such as automotive, which was among the hardest hit in the recession and
“We can’t make parts fast enough; as fast as we make them they go out the door. It was like the dam broke for us.” – Steve Peplin, CEO, Talan Products, which makes stamped brackets, braces and other metal parts
time for them to make purchases from suppliers due to the scale of the work. Others, however, including transportation and consumer electronics, are through their restocking cycle and now are ordering to meet customer demand, he said. Most manufacturers expect and hope for the good trends to continue. They may have reason for optimism. The Institute for Supply Management, which tracks data from purchasing managers and other sources in industry, on April 27 predicted that the manufacturing sector will grow by 6.3% in 2010. The expected pickup is likely to translate into more hiring in the manufacturing sector, a process that already has begun. Talan, for instance, went from 75 employees in 2008 to only 41 in the heart of the recession in 2009. Today, it’s back up to 61 employees and is looking for more, Mr. Peplin said. “Here’s another paradox — we’re actually having trouble finding really good press operators,” he said. But even Mr. Peplin had to laugh at facing that predicament, when comparing it with last year’s problem of telling people he had no work for them to do. “This is so much more fun,” he said. ■
We understand that one size does not ¿t all. We know this much is true: small clients become big clients and big clients still have small needs. So we approach every opportunity - large or small - as if our reputation is on the line. Because it is. Contact Jones Lang LaSalle today. We’re the one company that ¿ts all your real estate needs. For real estate services: Robert J. Roe Managing Director + 1 216 861 7171 www.us.joneslanglasalle.com/cleveland © 2010 Jones Lang LaSalle IP, Inc. All rights reserved.
Unforgettable Meetings, Conferences & Special Events for 5 to 500! 5_11_10_We fit all sizes submission.indd 1
I A History of Generous
Hospitality “I’ve recently seen steady increases in technology, defense, and forging and industrial markets,” Mr. Fulton said. “They have all shown signs of increasing demand, improving frequency of shipments and moving up due dates — all indicators of positive manufacturing occurrences.”
Can you say ‘overtime?’ Manufacturers themselves say they’re seeing two things: old customers beginning to order items again, and new customers that either lost suppliers in the downturn or are looking to switch to healthier suppliers than the ones they have now. In Cleveland’s Collinwood neighborhood, Talan Products is seeing customers that put off ordering the company’s stamped brackets, braces and other metal parts during the recession but now need those pieces and finally can afford them. Much of what the company makes is used on buildings, either in new construction or for ongoing maintenance, and it’s the latter end market that has really taken off, said Talan CEO Steve Peplin. “We think it’s pent-up demand for stuff that didn’t get done in 2009,” Mr. Peplin said. “At the end of 2008, when the crash hit, everyone was terrified; it looked like the end of the world,” he said. “But in building maintenance, if you don’t pay me now, you’re going to pay me later — and maybe
depends on a strong overall economy and increased consumer spending to make a come back. “Our business is booming right now in a variety of end markets,” said Chris DiSantis, CEO of Cleveland-based Hawk Corp, which makes friction materials for clutches and brakes for the automotive and heavy equipment markets. “I don’t expect the cycle of inventory replenishment to be finished until later this year,” Mr. DiSantis said. However, Mr. Haas said order volumes in sectors such as automotive aren’t yet moving up in a straight line. There still are some customers coming in with lastminute orders. “We keep getting surprised, in a good way, by the continuous increases in demand,” he said.
More than a hundred years ago, Earl W. Oglebay established a tradition of generous hospitality at his summer estate. Today, Oglebay Resort continues that tradition with outstanding overnight accommodations, exceptional amenities and an experienced staff.
Fun paradox
Private locations & deluxe accommodations... perfect for executive retreats & golf outings.
Business also has improved for Alcoa Wheel and Transportation Products in Cleveland, and for the most part has become steady and more predictable, said marketing manager Brian Thomas. Like other companies, Alcoa sees varying degrees of improvement in its end markets, which are affected at varying points in the economic cycle. Mr. Thomas said industries such as construction and aerospace are lagging the recovery a bit, because when companies in those industries receive a contract, it can take a long
WRITE TO US Send your letters to: Mark Dodosh, editor, Crain’s Cleveland Business, 700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 e-mail: editor@crainscleveland.com
I Wilson Lodge...Transformed! Wilson Lodge at Oglebay recently added 59 premium rooms and suites, and the West Spa. This new level of guest comfort, combined with our 22,000 sq. ft. of state-of-the-art meeting space, will make your next meeting an unforgettable event. I Premium Cottages & Estate
Houses
I 1,700 acres of year-round
recreation 72 holes of golf, specialty shops, gardens, a zoo, tennis, museums, fishing & more. I Delicious Dining Options From cookouts to gourmet. . .served in beautiful banquet rooms or catered outside.
Resort & Conference Center Wheeling, West Virginia Phone: 800-972-1991 Email:sales@oglebay-resort.com www.oglebay-resort.com
Just 3 hours from Cleveland!
5/11/2010 2:17:42 PM
20100517-NEWS--12-NAT-CCI-CL_--
12
5/13/2010
1:54 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
Compensation Group.
GOING PLACES
REAL ESTATE
MANUFACTURING
JOB CHANGES
HEALTH CARE
EDUCATION
PRIORITY HOME HEALTH CARE INC.: Diane Crish to director of nursing; Jessica Noelker to human resources assistant; Elis Diaz and Secerine Tinch to senior client service representatives; Kim Freeman to client service representative; Terri Hall to home care coordinator.
SOUTH EUCLID-LYNDHURST SCHOOL DISTRICT: Chester Young to supervisor of transportation.
FINANCE CHARTER ONE: Robert S. Coleman to senior vice president, director of commercial banking.
LEGAL
FINANCIAL SERVICE
BUCKINGHAM, DOOLITTLE & BURROUGHS LLP: David J. Lindner to associate.
FINKLER & COMPANY CPAS: Kathy Vanderhorst to marketing coordinator.
MANSOUR, GAVIN, GERLACK & MANOS CO. LPA: Sandra J. Brantley to associate.
RETIREMENT SOLUTIONS: Molly Skiles to administrative assistant.
ZASHIN & RICH CO. LPA: Scott Coghlan to chair, Workers’
FABER-CASTELL USA: Diane Ward to buyer; Amy Nilsen to key account coordinator; Mary Bangert to quality control inspector.
CARNEGIE COS.: Miranda Imperi to leasing consultant, Whitewood Apartments.
SERVICE
ADCOM COMMUNICATIONS INC.: Jenifer Lansky-Walsh to account director.
IMARC RESEARCH: Brandy Smith to chief of clinical operations; John Lehmann to director of business development; Alison Campbell to clinical research associate.
HENNES PAYNTER COMMUNICATIONS: Michael O’Mara to vice president.
SAFETY TECHNOLOGIES: Paul Popovich to life safety sales consultant; Chris Jones to sales consultant.
MELAMED RILEY ADVERTISING: Nicole Melville and Joseph Hughes to art directors.
SMITH & SCHAEFER: Susanne Mayer to lab equipment account manager.
NONPROFIT
TECHNOLOGY
LAKE COUNTY YMCA: Carolyn Tippie to finance director.
PARAGON: Dijoy Divakaran, Dusty Eves, Steve Gaetjens, Alicia
MARKETING
WWW.DOLLARBANKBIZ.COM
“ I DON’T WANT A BIGGER BANK. I WANT A BETTER BANK. ” Ever feel like your small business is getting downsized banking service? If you’re not getting the attention you need and service you deserve, talk to Dollar Bank. As a mutual bank, we’re independent like you. That’s why we’ve redefined service for small business. We stay in touch. We follow up. We learn your business to offer ideas before you ask. READY FOR A BANK THAT TAKES YOU SERIOUSLY? LET’S TALK @ 216.736.8938 WWW.DOLLARBANKBIZ.COM
Young
Ward
Nilsen
Lansky-Walsh O’Mara
Melville
Hughes
Tippie
Smith
Lehmann
Zenty
Rose
Schroeder, Margaret Sokolski and Zeus Sukumaran to systems consultants. PARK PLACE TECHNOLOGIES: Judy Collister to vice president, human resources.
BOARDS CLEVELAND SIGHT CENTER: Stanley E. Wertheim to chair; Andrew L. Sikorovsky to first vice chair; Jane Grebenc, William L. Spring and Frann R. Zverina to vice chairs; John P. Wolf to treasurer; Gary W. Poth to assistant treasurer; Fred D. Kidder to secretary; Sheryl King Benford to assistant secretary. CONSTRUCTION FINANCIAL MANAGERS ASSOCIATION, NE OHIO CHAPTER: Diana Chalmers (VN Services) to president; Donna Drumheller to treasurer; Mark Watkins to past president. JD BREAST CANCER FOUNDATION: Anna Ferguson to acting president; Erin Adams Armstrong to vice president. LAKE HEALTH: Susan TullaiMcGuinness to chair; Bruce M. Kephart to vice chair; Greg D. Taylor to treasurer; Dr. Daniel B. Cudnik to secretary. RECOVERY RESOURCES: Margaret G. Weitzel (Wyse Advertising) to chair; Thomas C. Wagner to vice chair; Renee Holcomb Hardwick to secretary; Victor F. Faris to treasurer; John F. Lewis to chair-elect. THE UNITED STATES GREAT LAKES SHIPPING ASSOCIATION INC.: Thomas Gierszal to president.
Q
AWARDS B’NAI B’RITH: Thomas F. Zenty III (University Hospitals) received the 2010 National Healthcare Award.
SMALL BUSINESS CORPORATE TREASURY MANAGEMENT COMMERCIAL REAL ESTATE LEASING Q
Q
Q
Q
KENT STATE UNIVERSITY: John Rose (Ciuni & Panichi Inc.) received the Accounting Department Alumni of the Year Award. RECOVERY RESOURCES: Martha B. Baker received the Helen K. Jones Woman of Strength Award. Equal Housing Lender. Member FDIC. Copyright © 2010, Dollar Bank, Federal Savings Bank.
BUS078_10
Send information for Going Places to dhillyer@crain.com.
20100517-NEWS--13-NAT-CCI-CL_--
5/13/2010
9:45 AM
Page 1
MAY 17-23, 2010
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
13
Chrysler may fill compact Fed proposal makes CRA activity pay could earn higher void sooner than expected Banks marks by rehabbing, INVESTING IN COMMUNITY
Fourth quarter 2011 target for Fiat-based models By BRADFORD WERNLE Automotive News
DETROIT — Chrysler Group could bring several Fiat-based compact vehicles to the United States sooner than expected, CEO Sergio Marchionne said on a conference call last week. The vehicles could be on the market as early as the fourth quarter of 2011, based on design work that already has been completed, Mr. Marchionne said. “We’ve run extensive clinics on the first vehicles. We’re 98% there on styling,” he said. “My expectation today is we’ll be able to get this car into the market Q4 2011. We continue to work pretty aggressively on timing.” The Fiat-based vehicles would fill a void in the market for Chrysler, which lacks a compact sedan although it does have three compacts: the Jeep Compass and Patriot crossovers and the Dodge Caliber hatchback. Before then, Chrysler also plans to address another area of weakness in its lineup: midsize sedans. Mr. Marchionne said the company will deliver significantly improved versions of its Chrysler Sebring and Dodge Avenger sedans in the fourth quarter. “We have carried out significant surgery on the architecture of those
“We’ve run extensive clinics on the first vehicles. ... We continue to work pretty aggressively on timing.” – Sergio Marchionne, CEO, Chrysler Group cars and made significant improvements of the interiors,” he said. In the third quarter, new versions of the Jeep Wrangler and Patriot will debut, featuring improved interiors. This week, Chrysler began building the 2011 Jeep Grand Cherokee at its Jefferson Avenue plant in Detroit. “We’ve eliminated remaining issues about quality,” Mr. Marchionne said. “We feel comfortable we’ve resolved all technical issues.” The new Grand Cherokee “is the basis on which we’ll try to rebuild the Jeep brand on a global scale,” he said. “It is the symbol of Jeep.” The vehicles will start reaching dealerships by the middle of June, and the marketing and advertising campaign will start about the same time, Mr. Marchionne said. ■
selling foreclosed homes By ARIELLE KASS akass@crain.com
In the latest issue of Forefront, the Federal Reserve Bank of Cleveland’s magazine about economic policy, the Cleveland Fed puts forth a proposal that argues for using the Community Reinvestment Act to fight vacancies and home abandonments. Now, the article says, banks are rewarded with high CRA rankings if they make lending available in the neighborhoods they serve. The proposal would make it possible for banks to earn “outstanding” ratings for rehabilitating and disposing of foreclosed properties in any lowincome area in the country. The change would give banks bonus points for lessening the vacancy problem — the Fed said in Cuyahoga County alone, banks owned 1,500 foreclosed-upon properties in 2009 — thus allowing them to earn the highest score based on rehabilitation efforts, even if other efforts remain satisfactory.
A look at a proposal from the Federal Reserve Bank of Cleveland that would alter the Community Reinvestment Act:
■ Currently: Banks rewarded by making lending available in neighborhoods they serve ■ Under new Fed proposal: Banks also would have a chance to earn “outstanding” ratings by cleaning up foreclosed properies in any low-income area in the country
“You could just change the test so that banks increase their REO (real estate owned property) activities along with everything else they were doing before,” wrote Emre Ergungor, senior research economist with the Cleveland Fed, in the article. “But I think we can achieve a path of least resistance if we do not increase the burden on banks.” The changes only would remain in place until the number of foreclosed properties sinks below a pre-determined threshold. If that threshold is again breached, the rules would go back in place. Banks still would be able to earn
outstanding ratings under the old rules, the proposal noted. In 2009, only 7% of banks were rated at that level. The proposal seeks to “modernize” CRA compliance, the Fed said. “To banks, CRA compliance can seem like trying to solve a puzzle: to obtain a high rating, they must place many different pieces in just the right spots,” the article stated. “On top of its complexity, compliance is seen as a burden: Some banks complain that CRA activities are unprofitable, or less profitable than other activities they could be pursuing.” New rules would allow banks to work in communities where they don’t have branches, but where they have underwritten a lot of mortgages, the Fed said. The Fed is seeking feedback on the proposal. “While we don’t expect our proposal to single-handedly solve the vacancy and abandonment problem, we do think it could have a material impact,” Mr. Ergungor wrote in the article. Forefront also made note of the success of the Cuyahoga County Land Bank and wrote about small business credit and whether a stock option can predict financial system chaos. To read the entire 32-page issue, see www.clevelandfed.org/Forefront. ■
(Bradford Wernle is Chrysler Group reporter for Automotive News, a sister publication of Crain’s Cleveland Business.)
Mission Baseball! Insightful legal solutions that help our clients find time to play ball
Helen Moss Breast Cancer Research Foundation wishes to congratulate Managing Trustee
Helen Moss Winner of Crain’s Cleveland Business’ Healthcare Heroes Award for Healthcare Advocate -- Individual on Thursday, May 6th Crain’s Acceptance Speech $1,500,000 Professorship in Integrative Oncology at Case Western Reserve School of Medicine.
The attorneys at McDonald Hopkins are on a mission to solve the business and legal issues that interfere with your work-life balance.
Attorneys on a Mission
®
Your mission is our mission. We never lose sight of it.
“Today we are committed to creating a ground-breaking professorship at Case Western Reserve School of Medicine, using as its prototype the Laurance Rockefeller Chair, at Memorial S-K. The Dean of the medical school at Case, Dr. Pamela Bowes Davis, met with Helen Moss late last summer, and made a commitment that we work together in making Case WRU School of medicine and its affiliated hospitals, including University Hospitals, national leaders in transforming cancer care in this country in education and teaching, patient care, and research in the field of integrative oncology.”
Dr. Pamela Bowes Davis,M.D,
DONATE TO Helen Moss Breast Cancer Research Foundation Professorship in Integrative Oncology at Case Western Reserve Medical School 9619 Lake Shore Blvd., Bratenhal, OH 44108
A business advisory and advocacy law firm 600 Superior Avenue, East, Suite 2100, Cleveland, OH 44114 216.348.5400 Carl J. Grassi
Shawn M. Riley
President
Cleveland Managing Member
Chicago • Cleveland • Columbus • Detroit • West Palm Beach www.mcdonaldhopkins.com
Name Address City State Zip Telephone ( ) Fax ( ) Email Amount $100 $500 $1,000 Other helenmoss6@roadrunnner.com
Helen Moss Breast Cancer Research Foundation • www.helenmoss.org
20100517-NEWS--14-NAT-CCI-CL_--
14
5/13/2010
3:06 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
Legislators tackle murky price issue Study: Increase in family “(Consumers) have to be House panel to review three bills aimed at easing medical costs largest ever able to go somewhere to confusion of complicated health care information By MATTHEW DoBIAS Modern Healthcare
WASHINGTON — A House panel plans to take up a trio of bills aimed at increasing transparency and clarity in health care pricing, tackling an issue that has bedeviled the industry for decades and handcuffed efforts to turn everyday people into better purchasers of care. “In order for people to make informed decisions and to be their own true consumer advocate in the purchase of health care, they have to be able to go somewhere to get valid information about cost, price and quality, too,” said Rep. Michael Burgess, R-Texas. “Cost and price are not the same thing, and there are very few places to go to get this,” said Rep. Burgess, a physician who sponsored one of the bills in front of the House Energy and Commerce health subcommittee. One bill, introduced by Rep. Steve Kagen, D-Wis., also a physician, requires hospitals, doctors, nurses, pharmacies and a range of manufacturers and vendors to openly disclose prices. Failure to do so would result in a financial penalty to be determined by the Department of Health and Human Services. Another bill, a bipartisan package
steered by Rep. Joe Barton of Texas, the senior Republican on the Energy and Commerce Committee, also aims to lift the veil on costs and charges. Rep. Barton’s bill requires public and private health plans to make known what services are covered, restrictions in coverage, cost-sharing requirements and participating providers. Two years out, it would require hospitals and ambulatory surgical centers to publicly disclose the charges for services they typically performed. Quality information also would be paired with the other measures. Rep. Burgess’ bill requires state Medicaid programs to disclose charges for hospital services and requires health plans to provide their enrollees cost estimates. Taken together, the bills attempt to give individuals the important information they need to choose where to go for care and how much they can expect to pay once they get there. Walter Rugland, board chairman for three-hospital ThedaCare, a hospital and physician system based in Appleton, Wis., called price transparency the key to the economic well-being of the health care sector. His company was one of the first in his state to post the cost of care for,
get valid information about cost, price and quality, too.” – Michael Burgess, Texas congressman and sponsor of a House bill on health care pricing say, a knee replacement. “Seven years ago, we said that the future of sustainable health care is going to require that the patients be involved in deciding where to go and what to have done, and that all health care is not the same and all prices are not the same,” Mr. Rugland said. Even with the promise of bettereducated consumers, there are still uncertainties with making the medical dollar amounts widely available. It’s unclear whether doing so would drive down costs for those hospitals at the higher end of the spectrum or would have the opposite effect, with systems at the lower end instead boosting the prices of their services. There’s also a question as to whether the general public would make use of such information even if it is made widely available. “They’re not looking at it yet,” Mr. Rugland said. ■ (Matthew DoBias is Washington bureau chief of Modern Healthcare, a sister publication of Crain’s Cleveland Business.)
Family of four’s employer coverage averages $18K By JOANNE WOJCIK Business Insurance
Average medical costs for a typical U.S. family of four enrolled in an employer-sponsored preferred provider organization plan rose $1,303 this year to $18,074, the largest dollar increase since the Milliman Medical Index began in 2005. The costs, which include employer and employee premium contributions, copayments and deductibles, grew an average 7.8% this year, up from 7.4% last year, Seattle-based Milliman Inc. said last week. Now averaging $10,744, the average employer share surpassed $10,000 for the first time for the typical family of four’s PPO coverage, Milliman said. These costs could grow as a result of health care reform, Milliman predicted. “This year’s MMI offers an interesting example of that old axiom, ‘The more things change, the more they stay the same,’” said study co-author Lorraine Mayne, a Milliman principal and consulting actuary, in a statement. “The cost of group insurance continues to increase at a historically consistent pace, even with reform now the law of the land. While there will be short-term cost implications,
especially for particular employees and certain employers, this year reflects a continuation of the prevailing cost trends,” Ms. Mayne said. Chris Girod, also a Milliman principal, consulting actuary and co-author of the study, noted that the economic environment and high unemployment rate already may have affected health care costs. “When employees are laid off, there are also cost ramifications for the remaining employees,” Mr. Girod said. Hospital inpatient costs posted the largest rate of increase, growing 9.8% this year compared with 7.7% last year. Milliman noted that most of the inpatient increase was driven by higher average unit costs with little change in utilization. By contrast, the rate of increase in physician costs declined to 5.2% this year from 6% last year, while pharmacy costs increased 6.1% this year compared with 7.5% last year. The Milliman Medical Index is based on Milliman’s analysis of historical claims data, utilization trends and associated costs. The “2010 Milliman Medical Index” is available online at www.milliman.com. ■ (Joanne Wojcik is an editor with Business Insurance, a sister publication of Crain’s Cleveland Business.)
Just one of the things you could do with the 15% savings from a Medical Mutual health plan. If you’re a business owner with 51 – 99 employees and your insurance is up for renewal, you’ve likely received a quote that’s higher than ever. So, now is really not the time for those long-overdue office upgrades. Or is it? We can save you some serious money — up to 15 percent off your renewal rate.
You owe it to yourself — and your office. Call your insurance broker or us at (877)730 –7773 before May 28th.
Well Within Reach.™
© 2010 Medical Mutual of Ohio
20100517-NEWS--15-NAT-CCI-CL_--
5/13/2010
9:44 AM
Page 1
MAY 17-23, 2010
BRIGHT SPOTS Bright Spots is a periodic feature in Crain’s, highlighting positive business news in Northeast Ohio. To submit information, please e-mail Scott Suttell at SSuttell@crain.com. ■ Millman Surveying Inc. of Hudson, which specializes in ALTA/ACSM land title surveys for the commercial real estate market, said it has introduced a platform to view and interact with surveys and other due diligence property information. (For those outside this industry, ALTA is the American Land Title Association, and ACSM is the American Congress on Surveying and Mapping.) Millman Virtual Surveyor is a proprietary, online passwordprotected tool that allows Millman clients and their attorneys, lenders and title companies to easily review and interact with property information. With the click of a mouse, “users can move between the components of a legal description and the corresponding call on the survey,” the company says. In addition, a user can move between an easement on Schedule B of the title report to the document itself and its depiction on the survey. For information, visit www.millman surveying.com. ■ Looking to get your work day off to an active start? Then take part in the third annual Cleveland Bicycle to Work Day this Friday, May 21. The Northeast Ohio Areawide Coordinating Agency, along with Cleveland Bikes, the Ohio City Bicycle Coop, University Circle Inc. and the Cleveland YMCA, has organized this year’s event. “Bicycle commuting is an environmentally friendly, healthy way to get to work,” said Howard R. Maier, NOACA executive director. “Many bicyclists are using bike lanes and paths to get to work.” Between 7 a.m. and 9:30 a.m. on Friday, Bicycle to Work Day participants are invited to stop at the minipark on the corner of Huron Road and Ontario Street for free breakfast snacks, coffee donated by Phoenix Coffee Co. and a bag of freebies. Details are at www.ClevelandBicycle Week.org. ■ OEConnection LLC of Richfield, an online parts and service exchange for the automotive industry, said Volkswagen of America Inc. has selected OEConnection’s CollisionLink Internet-based parts ordering and fulfillment system for Volkswagen
dealerships and its collision repair facility customers nationwide. Central to this agreement is CollisionLink’s Parts Marketing Administration (PMA) technology, which automates and manages automaker parts programs, OEConnection said. PMA was designed to help dealerships take advantage of automaker incentives and discounted promotions to sell more original equipment manufacturer (OEM) parts to body shops as an alternative to lowerpriced aftermarket and salvage collision parts. “The implementation of CollisionLink, combined with Volkswagen’s strategic parts pricing strategy, creates growth opportunities for Volkswagen of America, its dealerships and their collision repair facility customers,” said Mark Tomasetti, OEConnection senior vice president and chief commercial officer. Dan Ducharme, parts strategist for Volkswagen of America, said Volkswagen has a network of more than 580 U.S. dealerships that act as wholesale distributors of OEM
collision parts. “This new arrangement emphasizes Volkswagen’s goal of helping these dealerships sell more OEM parts and building relationships with their repair facility customers,” he said. Volkswagen will launch the program to select dealerships in August.
■ Daily headlines: A collection of Crain’s-produced news and blog items from the day ■ eCleveland!: A weekly guide to arts and leisure in Northeast Ohio
SIGN UP NOW AT: CrainsCleveland.com/register
a portfolio company of
The undersigned acted as exclusive financial advisor to PECO II, Inc. and rendered a fairness opinion to the Company’s Board of Directors in this transaction
For more information, please call (216) 589-0900 or visit www.wesrespartners.com
D
A A
Cleveland State Universit y and the Cleveland State Universit y Alumni Association 20th Annual
P L E A S E R S V P B Y F R I D A Y, M A Y 2 1 b y c a l l i n g 2 1 6 - 6 8 7 - 2 0 7 8 o r l o g g i n g o n t o w w w. c s u o h i o. e d u / a l u m n i
$65 per person ] Includes dinner, wine and valet parking
istinguished
lumni
wards
SATURDAY, JUNE 5 I N T E R C O N T I N E N TA L H O T E L & C O N F E R E N C E C E N T E R 9 8 0 1 C A R N E G I E AV E N U E R E CE P TI ON AN D W I N E P UL L 5 P.M. D I N N E R AN D P R OG R AM 6 P.M. Business Attire
201 0 D I S T I N G U I S H E D A L U M N I AW A R D R E C I P I E N T S G E O R G E B. DAV IS AWARD F O R S E RV IC E TO T H E U N IV E R S IT Y Irene A. Holyk Rennillo, JD ’83 President and Co-Founder Rennillo Deposition and Discovery The Rennillo Foundation
COL L EGE OF E DUC ATI ON College of Graduate S tudies AN D HUMAN S E RV I CE S Tanisha R. Briley, MPA ’05 Catherine S. Koppelman, BSN ‘78 Assistant to the City Administrator RN, MSN, NEA-BC and Budget Manager Chief Nursing Officer City of Davenport, Iowa University Hospitals & University Hospitals Case Medical Center
N AN C E COL L E G E O F B U S IN E S S ADM IN IS T RAT IO N Saji T. Daniel, BBA ’90 President and Chief Executive Officer Tradex International, Inc.
COL L E G E O F S C IEN CE Dr. David G. Watterson Jr., MA ’72 Senior Partner/Owner Watterson & Associates
MAXINE GOODMAN LEVIN CO L L E G E O F U R B AN AF FAIR S John J. Boyle III, MUPDD ’02 Vice President, Business Affairs and Finance Cleveland State University
Register for free e-mail alerts and receive:
■ Breaking news alerts: When major news happens, you’ll know
has been acquired by
■ The Riverside Co. has made its first investment in Australia weeks after opening an office in Melbourne last month. The private equity firm finalized an agreement to acquire a majority stake in Boost Investment Group, owners of Boost Juice Bars and Salsa’s Fresh Mex Grill. Boost Investment Group has more than 250 juice bars in 14 countries and 20 Salsa’s locations. Jeff Allis, the CEO, will remain in charge of the company and all existing board members and shareholders will continue to hold shares. The investment is part of Riverside’s broader strategy to expand into the Asia-Pacific region. Terms of the deal were not disclosed.
GET DAILY NEWS ALERTS FROM CRAIN’S !
■ The Morning Roundup: A collection of the day’s business news from Ohio’s daily papers
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
P R E S E N T E D W I T H T H E S U P P O R T O F:
F E N N COLLE GE O F E NGI N E E RI N G Terrence V. Zuk, BSIET ’64 Retired Plant Manager PCC Airfoils, Inc.
COLLEGE OF LIBERAL ARTS AN D S OCI AL S CI E N CE S Miriam Solomon Plax, BA ’75 Director of Community Relations Department of Psychiatry University Hospitals Case Medical Center
CLE V E L AN D -MARS HALL COLLE GE OF L AW David M. Paris, JD ’78 Managing Partner Nurenberg, Paris, Heller & McCarthy Co., L.P.A.
15
20100517-NEWS--16-NAT-CCI-CL_--
16
5/13/2010
1:55 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
E!CLEVELAND Every Thursday, Crain’s sends more than 20,000 readers an arts and leisure e-mail called e!Cleveland. The e-mail highlights at least 10 events, and often more, that might be worth your time outside work. We’re fortunate in Northeast Ohio to have a vibrant arts community, and each edition of the e-mail features a mix of local music, theater, dance, film and other activities. To sign up for this and all our e-mails, visit www.CrainsCleveland .com and click the “Register for Crain’s alerts” icon at the top left of the home page. And the price is right; it’s free. If you have events you’d like us to consider for inclusion in future editions of the e-mail, send information to managing editor Scott Suttell at ssuttell@crain.com. Here’s a taste of what makes it into the e-mail each week:
Signs of the times Event: “Detour” and “Sometimes an entrance is actually an exit” Venue: SPACES Gallery, 2220 Superior Viaduct, Cleveland When: Now through Friday, July 16 Why you might be interested: If you’re up for a little adventure. For “Detour,” SPACES says it has “created a framework for play wherein five selected artists meet to discuss their practices and address areas of comfort and discomfort.”
By the end of the evening, each artist will be assigned an obstacle by his or her peers. One artist might rely heavily on a specific media, SPACES says, but the other four “might agree it would be good to step out of that comfort zone.” Meantime, artists Josh Parker’s large-scale, multimedia installation, “Sometimes an entrance is actually an exit,” provokes viewers “to question perceptions of a changing environment, the concept of time, and test our willingness to follow unknown territory while facing possible isolation,” SPACES says. The gallery space “will be transformed into a mysterious labyrinth that challenges concepts of boundaries and space.” Mr. Parker is working on his master’s at Kent State University, where he also received a BFA in sculpture. On the web: www.Spaces Gallery.org
Spirit of adventure Event: “The Secret of Kells” Venue: Cedar Lee Theatre, Cleveland Heights When: Now playing Why you might be interested: If, when you looked at the Oscar nominations for Best Animated Feature Film, you said, “What the hell is ‘The Secret of Kells’?” The other nominees — “Coraline,” “Fantastic Mr. Fox,” “The Princess and the Frog” and the eventual winner,
WWW.CRAINSCLEVELAND.COM
“Up” — were well-known, but almost no one had heard of this Irish import. The simple story follows the adventures of a young monk who’s working to complete an illustrated book, focusing on preparations at a medieval abbey for a Viking invasion. The voice work is done by a mostly unknown cast, with the exception of Brendan Gleeson, one of the best character actors in movies today. (You’ll recognize him from the “Harry Potter” movies, but check him out in “In Bruges” if you haven’t seen that gloriously profane film.) On the web: www.Cleveland Cinemas.com
MAY 17-23, 2010
Foundation. To fund their activities and a permanent clubhouse, the Kokooners in 1913 inaugurated an annual “bal masque,” a bohemian revel that by the 1920s attracted thousands of free-spirited Clevelanders. Included in this exhibition are bal masque costumes, photographs and posters designed by club members for their events. On the web: www.Cleveland Artists.org
Oh Canada
Event: Concert by Metric Venue: House of Blues, Cleveland When: Wednesday, May 19, at 8 p.m. Why you might be interested: If Out of the cocoon your concert-going résumé is light Event: “The Kokoon on Canadian indie Arts Club: Cleveland rock bands. And if it is, Revels!” Metric is a good place Venue: Cleveland to fill in a hole. This Artists Foundation at foursome from Toronto the Beck Center for the debuted in 2003 with Arts, Lakewood “Old World UnderWhen: Now through ground, Where Are Saturday, July 31 You Now?,” which Why you might be earned a Juno Award interested: If you’re a nomination for Best free spirit. The exhibiAlternative Album. tion (pictured at right), They’ve been critical curated by Dr. Shirley favorites over the years, Teresa Wajda, is traveling and they’re starting to from Kent State Uniattract mainstream, IMAGE COURTESY OF KENT versity. It chronicles commercial attention. STATE UNIVERSITY MUSEUM the spirit of The The band’s very catchy Kokoon Art Club, “Gold Guns Girls” is founded in 1911 by a small group of on the iPhone app dedicated to commercial artists employed at Audi’s new A1, and it will have a Otis Lithograph Co. The club’s song on the soundtrack for the new founding members pledged them“Twilight” franchise movie this selves to explore “the New Art,” summer. Metric’s newest album, according to the Cleveland Artists released last year, is “Fantasies.”
On the web: www.hob.com/ Cleveland
There will be blood Event: “Lucia di Lammermoor” Venue: State Theatre, PlayhouseSquare When: Thursday, May 20; Saturday, May 22; and Sunday, May 23 Why you might be interested: If you can’t avoid watching a family feud. This tragic opera by Gaetano Donizetti (pictured above), which debuted in 1835, concerns a feud between two families, the Ashtons and the Ravenswoods. Ruthless family politics deny Lucia her true love, breaking both her heart and her mind. From the depths of madness and tragedy “comes some of opera’s most riveting bel canto singing,” say officials at Opera Cleveland. Tomer Zvulun (“La Boheme,” 2008) returns to Cleveland to direct this production, featuring sets adapted specifically for Opera Cleveland. On the web: www.OperaCleve land.org
20100517-NEWS--17-NAT-CCI-CL_--
5/13/2010
2:40 PM
Page 1
MAY 17-23, 2010
Americans rethink gasoline needs Survey: BP oil spill affects consumption By TIRE BUSINESS STAFF
A national survey has found that more than one in five Americans plan to drive less in the wake of the recent oil spill in the Gulf of Mexico, and one in eight said they plan to stop buying British Petroleum gas altogether. The survey, conducted by Shelton Group of Knoxville, Tenn., polled 1,312 consumers across the country. It found 20% of respondents said they will reduce their gas consumption in response to the oil spill, while 13% said they would stop buying BP gas. “For years our research has shown America is a see-it-to-believe-it nation. Before we make changes, we need to see things with our own eyes or have a personal connection to something,” said Suzanne Shelton, president of Shelton Group. “If Americans start seeing a lot of oil-covered pelicans or dying dolphins, these numbers will likely go even higher.” According to a recent study by the firm, “Driving is one of the hardest things for Americans to give up for the environment,” Ms. Shelton said. “Our lives are built around our cars,” she said. “It may take a major disaster for us to change our driving habits, and, unfortunately, this may be that major disaster.” Among the survey’s other findings: The combined impact of the oil spill and the recent mine disaster in West Virginia has caused more than two in every five Americans to think about the “human and environmental costs” associated with their own energy consumption. About three in 10 Americans — 28% — said the Gulf spill has made them dislike BP, but their “opinion
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
might improve” if BP can do more “to clean up the mess and make amends.” One in five — 20.5% — said they now doubt BP’s “Beyond Petroleum” slogan and believe it is not really a green company. The good news for BP, according to survey results, is that 37.5% of those interviewed said the oil spill had not affected their opinion of the company in any way. And 17.4% said it makes them “respect the company for taking responsibility for the accident and cleanup.” More than a third of respondents — 35.5% — said the spill “was a terrible accident, but our country’s need for domestic oil makes the possibility
of such accidents an acceptable risk.” Twenty-one percent called the spill “a terrible accident waiting to happen, and offshore drilling in the Gulf should be halted.” “The jury is still out for BP in terms of its ability to move forward and start rebuilding its reputation as an environmentally responsible company,” Ms. Shelton said. “There is immense risk that consumers’ anger toward BP will grow as the damage to the ocean and coastline grows.” The study has a margin of error of 3.08%. ■ (Tire Business is a sister publication of Crain’s Cleveland Business.)
Hard Times call for Hard Choices. Carey Roofing will solve your roof leak problem in a cost efficient manner.
CAREY Roofing Corp.
216•881•1999 www.careyroofing.com
founded in 1946 MEMBER: National Roofing Contractors Association
Hard at work
EVENT INFO Crain’s Cleveland Business has partnered with respected regional business leaders throughout the year in our signature “Ideas at Dawn” breakfast series. Each event offers time for coffee and breakfast while networking, followed by a panel discussion on selected themes that could improve your organization’s performance and bottom-line results. If you have a nagging challenge in your operation, Crain’s “Ideas at Dawn” panel discussions are a great source of solutions. Visit CrainsCleveland.com/breakfast for ticket information. Here’s a schedule of the upcoming breakfasts: ■ Wednesday: Navigating Risk in a Changing Economy: Promise and Peril for Business Owners, sponsored by Plante & Moran, Calfee and Wells Fargo. 7:30-9:30 a.m., Ritz-Carlton Cleveland. ■ June 9: Safeguarding Your Business: The Ins and Outs of Protection, sponsored by Taft Stettinius & Hollister LLP, Deloitte and IBM. 7:30-9:30 a.m., Ritz-Carlton Cleveland. ■ June 25: Making Sense of Health Care Reform, presented by Findley Davies and sponsored by Plante & Moran, Anthem, and Bricker & Eckler. 8 a.m.-10 a.m., RitzCarlton Cleveland.
You work hard for your business, but you shouldn’t be the only one. You need a bank that will work hard for you, too. At FirstMerit, our people and products provide you with smart, money saving advantages that will boost your bottom line. Come in and find out how we are hard at work for you.
firstmerit.com 1-888-283-2303
17
20100517-NEWS--18-NAT-CCI-CL_--
18
5/13/2010
9:46 AM
Page 1
CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $5,147
TAX LIENS The Internal Revenue Service filed tax liens against the following businesses in the Cuyahoga County Recorderâ&#x20AC;&#x2122;s Office. The IRS files a tax lien to protect the interests of the federal government. The lien is a public notice to creditors that the government has a claim against a companyâ&#x20AC;&#x2122;s property. Liens reported here are $5,000 and higher. Dates listed are the dates the documents were filed in the Recorderâ&#x20AC;&#x2122;s Office.
LIENS FILED Automatic Mechanical Corp. 3681 Ludgate Road, Shaker Heights ID: 68-0669978 Date filed: April 15, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $5,849
10919 Kinsman Inc. Strictly Dollar Store Number 1 10919 Kinsman Road, Cleveland ID: 20-2622743 Date filed: April 15, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $5,232 Paul F. Smith Jr., D.D.S., Inc. 20119 Farnsleigh Road, Suite 207, Shaker Heights ID: 34-1337892 Date filed: April 27, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding, unemployment Amount: $5,164 Engle Road Realty Inc. 7230 Engle Road, Cleveland ID: 06-1724874 Date filed: April 20, 2010
Outside Design Financial Management Inc. 1560 Brainard Road, Lyndhurst ID: 26-3781519 Date filed: April 8, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $5,005
LIENS RELEASED Anthony Group Inc. 10703 W. Pleasant Valley Road, Parma ID: 20-1291812 Date filed: Nov. 20, 2009 Date released: April 27, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $10,715 Capital Concrete & Waterproofing Inc. 2006 Lincoln, Parma
MAY 17-23, 2010
ID: 20-3056850 Date filed: Feb. 15, 2007 Date released: April 12, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding, unemployment Amount: $9,178 Charles P. Braman & Co. 23300 Chagrin Blvd.,Suite 102, Beachwood ID: 34-0877051 Date filed: July 28, 2008 Date released: April 20, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $13,303 CRS Co. 11089 W. Sprague Road, North Royalton ID: 34-1741604 Date filed: Sept. 4, 2007 Date released: April 20, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $63,897
Lakeside Building Services Inc. P.O. Box 470433, Broadview Heights ID: 51-0585756 Date filed: Sept. 28, 2009 Date released: April 27, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $37,988 Peter G. Gordon, D.D.S., Inc. 23300 Chagrin Blvd., Suite G10 ID: 34-1134403 Date filed: Oct. 13., 2009 Date released: April 12,2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $20,229 Rossi & Sons Inc. 4317 W. 130th St., Cleveland ID: 14-1944872 Date filed: Oct. 1, 2007 Date released: April 12, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding, unemployment Amount: $9,629 Warner Electronics Inc. 7725 Commerce Park Oval, Suite A, Independence ID: 34-1237911 Date filed: Dec. 20, 2006 Date released: April 12, 2010 Type: Employerâ&#x20AC;&#x2122;s withholding Amount: $38,598
Conradâ&#x20AC;&#x2122;s to offer free air as enticement for tire upkeep By TIRE BUSINESS STAFF
7R KHOS \RX XQGHUVWDQG WKH Ă&#x20AC; QDQFLDO UHSHUFXVVLRQV 0HUFHU LV RIIHULQJ \RX DQ H[FOXVLYH IUHH WULDO RI + % .QRZ+RZ DQ RQOLQH KHDOWK UHIRUP UHVRXUFH *HW VWDUWHG DW ZZZ PHUFHU FRP IUHHWULDO
Conradâ&#x20AC;&#x2122;s Tire Express & Total Car Care is bringing back a convenience not seen at many gas stations and tire dealerships for a number of years: free air. Conradâ&#x20AC;&#x2122;s has introduced Free Air Inflation Stations at all its locations in Northeast Ohio. The service represents a $100,000 investment in retrofitting all 31 of the companyâ&#x20AC;&#x2122;s Tire Express & Total Car Care centers with publicly accessible â&#x20AC;&#x153;inflation stationâ&#x20AC;? air pumps â&#x20AC;&#x201D; part of Conradâ&#x20AC;&#x2122;s effort â&#x20AC;&#x153;to make drivers aware of the benefits to maintaining properly inflated tires,â&#x20AC;? the Cleveland-based company said. Conradâ&#x20AC;&#x2122;s contends that the need for drivers to shell out 50 cents or more for a minute of air at most service stations dissuades many from maintaining their tires. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re hoping that, through our free air program, drivers wonâ&#x20AC;&#x2122;t worry about having to pay for regular tire upkeep and will revert back to checking their tire pressure on a monthly basis,â&#x20AC;? said Conrad president and CEO John Turk. â&#x20AC;&#x153;Our goal is to assist area drivers in saving money and gas, while increasing safety on the road.â&#x20AC;? The dealership cited a U.S. Department of Transportation study that reported 80% of all vehicles have underinflated tires, and that 27% of those tires that are underinflated by 25% or more. Conradâ&#x20AC;&#x2122;s said the average person who drives 12,000 miles yearly on underinflated tires uses about 144 extra gallons of gas â&#x20AC;&#x201D; which, at nearly $3 a gallon, can mean more than $400 a year in additional driving costs. â&#x2013; (Tire Business is a sister publication of Crainâ&#x20AC;&#x2122;s Cleveland Business.)
20100517-NEWS--19-NAT-CCI-CL_--
5/13/2010
1:54 PM
Page 1
MAY 17-23, 2010
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
19
Think you know Cleveland history? We’ll be the judge(s) As of last Thursday, May 13, more than 100 readers visited our special 30th anniversary web site to take this 20-question quiz about Northeast Ohio business. Three got all 20 questions right. Two of our quiz masters work at law firm Jones Day: research librarian Camilla Grigsby and partner Sanjiv Kapur. The third person with a perfect score was Sarah Wering, marketing manager at ToolingU.com, which provides training specifically to manufacturing workers. At the end of the day today, Monday, May 17, we will have a drawing to break the tie at the top. (Submissions were taken through last Friday, May 14, so it’s possible others turned in perfect sheets.) The winner will receive $100 to Lola. Four other people answered 19 of the 20 questions correctly. The quiz turned out to be difficult, because only 29 of 103 entrants even got 15 out of 20. More than half the respondents answered 10 or fewer questions correctly. How many of the questions can you get right? Sorry, this is just for pride — no more gift certificates. The answers are on Page 25. 1. LTV Corp. was formed in 1984 from the merger of Republic Steel and Jones & Laughlin Corp. In what year did LTV file for Chapter 11 bankruptcy? a. 1985 b. 1986 c. 1987 d. 1988 2. Harry Figgie Jr. in 1980 moved his conglomerate, A-T-O Inc. (later renamed Figgie International when the company returned to Northeast Ohio), to which southern city? a. Charlotte, N.C. b. Richmond, Va. c. Atlanta d. Mobile, Ala. 3. Which suburban company flirted with the idea in the late 1980s of building a mega headquarters in downtown Cleveland, only to stay and expand (and expand, and expand) in the suburbs? a. Progressive Corp. b. FirstEnergy Corp. (then known as Centerior) c. American Greetings Corp.
d. Steris Corp. 4. Cuyahoga County voters in May 1990 approved Issue 2, the tax issue to finance construction of the Gateway sports stadiums. By what percentage did the issue pass, and how many jobs did backers promise it would create? a. 51% to 49%, and 12,000 jobs b. 52% to 48%, and 28,000 jobs c. 54% to 46%, and 20,000 jobs d. 57% to 43%, and 25,000 jobs 5. The Cleveland Clinic is the largest employer in Northeast Ohio, with about 32,000 employees. Its CEO, Dr. Delos M. Cosgrove, has how many patents filed for developing medical and clinical products used in surgical environments? a. 8 b. 15 c. 22 d. 30 6. British Petroleum Co. shocked the Cleveland business establishment in 1986 by installing Robert Horton as CEO of Standard Oil Co. after booting out which person from the CEO job? a. John Miller b. Alton Whitehouse Jr. c. Frank Mosier d. John Browne 7. Some scenes of what Harrison Ford movie were filmed at Severance Hall in the mid-1990s? a. “Air Force One” b. “Clear and Present Danger” c. “The Devil’s Own” d. “Six Days Seven Nights” 8. How many women are currently CEOs of publicly traded companies based in Northeast Ohio? a. 0 b. 1 c. 2 d. 3 9. In January 1988, architect I.M. Pei unveiled plans for a $25 million, 18-story “glittering glass tent” for the Rock and Roll Hall of Fame and Museum on what site? a. The current lakefront location b. At the Tower City complex, overlooking the Cuyahoga River on West Huron Road c. In the May Co. building on Public Square
d. In the Gateway neighborhood 10. The Cleveland Press ceased publication in what year? a. 1979 b. 1980 c. 1981 d. 1982 11. Sherwin-Williams Co. in 1987 sold its Gray Drug Fair drugstore unit, based in Cleveland, to which company? a. Discount Drug Mart b. Revco D.S. Inc. c. Rite Aid Corp. d. Walgreen 12. MBNA Corp.’s Al Lerner bought the Browns in 1998 for how much? a. $450 million b. $530 million c. $700 million d. $1 billion 13. The Greater Cleveland Regional Transit Authority’s Waterfront Line in Cleveland opened in July 1996 and attracted about how many riders during its first 12 months? a. 450,000 b. 600,000 c. 800,000 d. 1.1 million
14. Before he was an alpaca farmer, Mike White was mayor of Cleveland. Which of these men was not among those Mr. White defeated during the campaign when he was first elected in 1989? a. George Forbes b. Tim Hagan c. Ralph J. Perk Jr. d. Frank Jackson 15. American Greetings Corp. in July 1992 launched card-making kiosks that the company expected to become the future of the greeting card industry. What was the kiosk business unit called? a. CallingCard b. CreataCard c. InstantCard d. DrawingCard 16. Which of these current Northeast Ohio CEOs has been in his job the longest? a. Robert J. Keegan of Goodyear Tire & Rubber Co. (Mr. Keegan stepped down from the CEO job after the quiz went active on the web) b. Alexander M. Cutler of Eaton Corp. c. Christopher M. Connor of Sherwin-Williams Co. d. Henry L. Meyer of KeyCorp 17. Which person spearheaded the effort to save the Playhouse-
Achieve.
TERRENCE O’DONNELL OHIO SUPREME COURT JUSTICE CLASS OF ‘71
Learn how our alumni engage at: www.csuohio.edu/alumni ®
Higher standards make better lawyers.
Vorys, Sater, Seymour and Pease LLP Cleveland 216.479.6100 Akron 330.208.1000 www.vorys.com
Square theaters from the wrecking ball in the 1970s, then was behind the second revival of the Hanna Theater Cabaret in the late 1990s? a. Art Falco b. Joseph Laronge c. Lawrence J. Wilker d. Ray Shepardson 18. Of the seven business entities that pledged funds in late 2002 to fund the nonprofit economic development group now known as Team NEO, only one was a corporation. Which was it? a. FirstEnergy Corp. b. Goodyear Tire & Rubber Co. c. Lubrizol Corp. d. Timken Co. 19. In December 1988, a landmark restaurant on Cleveland’s waterfront filed for bankruptcy, and it was bulldozed the following year. What was its name? a. Hornblower’s b. Captain Frank’s c. The Krusty Krab d. The Watermark 20. Crain’s launched its web site in January 1996. What was it called? a. Crain’s Online b. Crain’s on the Web c. Crain’s Now! d. Crain’s Future Goldmine!
20100517-NEWS--20-NAT-CCI-CL_--
20
5/13/2010
1:56 PM
Page 1
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
GM reconnects with more rejected dealers than forecast By NEIL ROLAND and CHRISSIE THOMPSON Automotive News
General Motors Co. has a new strategy in dealer relations, led by its CEO and North America boss: Clean up the mess left by the old GM. GM is adopting a more flexible
approach to its dealer network, welcoming back dozens of rejected dealers in the past two months and extending settlement offers of as much as $1 million. GM had said in March that it was offering reinstatement to 661 of the 1,160 dealerships whose owners sought arbitration over GM’s deci-
sion to wind down franchises at their stores. GM later raised the number to 666. Now the reinstatement figure is significantly higher. Lawyers say they have several dozen clients who weren’t on GM’s original reinstatement list but since have received letters of intent to bring them back,
All across Cleveland,
lending to small businesses is a #1 priority for us ESBI International Salon
Anthony Deliberato DDS Inc.
SBA Business Loan
Dental Financing Credit & Debit Card Processing Commercial Real Estate Loan
April 2009
September 2009
Dr. David Patton, DDS Dental Financing
Business Line of Credit & Term Loan Equipment Purchase
May 2009
May 2009
U.S. Bank is lending more than ever to keep America’s small businesses thriving.
often with the provision that they meet performance standards. When the dust settles, GM’s surviving dealerships likely will number more than 4,500, compared with the 3,600 the automaker said it wanted last year when it was in bankruptcy. “GM continues to backtrack on their business plan,” said Rob Byerts, a Tallahassee, Fla., lawyer whose firm originally represented about 50 rejected GM dealerships. The change in course is part of efforts by CEO Ed Whitacre and North America president Mark Reuss to personalize GM’s relations with rejected dealers. Instead of leaning on the formal arbitration process, Mr. Reuss has become the point person for resolving disputes with rejected dealers in one-on-one settlements. “Everyone’s different,” Mr. Reuss told Automotive News. “I have seen it all, and that’s OK. It’s part of making the company what it needs to be.”
Strings attached The new letters of intent often oblige dealers to hit sales targets, remodel buildings or remove competing brands from their showrooms, dealers and lawyers say. For instance, the reinstatement offer that Chevrolet dealer Kit Tennyson says he accepted this month requires his suburban Detroit store to meet GM’s sales goals by the end of 2011 and to be remodeled once sales are on track. He declined to give details on the sales guidelines but said they were reasonable and consistent with the 880 new vehicles he sold in 2008. Offering to restore dealers such as Mr. Tennyson is a shift for a company that once insisted it needed to use U.S. Bankruptcy Court to eliminate 1,350 dealerships by Oct. 31 to cut costs. “The business plan that was used as justification for wind-downs in bankruptcy has no vitality whatsoever,” said Mike Charapp, a McLean, Va., lawyer who originally represented about 20 rejected GM dealerships. “It’s clearly been swept aside.” Pre-bankruptcy GM had 6,150 stores that it planned to pare down to 3,600 before this November through a combination of cuts,
Small businesses. You are more than the American dream – you drive the American economy. Your success has never been more critical, and it’s a priority for us. All across the country and throughout Cleveland, we live and work side by side with our business partners. We’re proud to highlight just a few of the local clients our business banking professionals have partnered with to create custom solutions that keep cash flowing and businesses growing. All backed by the expertise and stability of one of America’s strongest banks.
usbank.com Deposit products offered by U.S. Bank, N.A. Member FDIC
Mark Rowland Business Sales Manager 216-623-9274
‘It was like coming home’ As head of GM’s settlement process, Mr. Reuss said he often hears variations of several core dealer story lines. There’s the dealer who’s willing to work to earn GM’s favor: “I want to be a good dealer. Here’s what I’m going to do. Help me do it,” Mr. Reuss said. Then, “we’ve gotten the ones that play games with me, quite frankly,” Mr. Reuss said. “So I play the game a little bit there, too.” He knows that approach is in order when a dealer says he has his sights on being the best Chevrolet dealer in the United States but refuses to agree to GM’s performance criteria. Some dealers ask for more aid during wind-downs, Mr. Reuss said. Lawyers say GM’s recent settlement offers often have ranged from $500,000 to $1 million, or as much as three times GM’s wind-down payment to a rejected dealership. When Illinois dealer Rusty Wagner heard GM was open to settlement talks, he called his regional office in hopes that GM would reinstate him after a heart-to-heart talk. But he was worried the automaker would make a conditional offer. Instead, Mr. Wagner didn’t even have to present his case at his recent face-to-face meeting with a GM rep in his town of Belleville, Ill. He said the regional office delegate seemed to have read his arbitration filing ahead of time and simply offered to reinstate his Buick-GMC store near St. Louis. Compared with the year of turmoil after GM said it would pull his franchises, Mr. Wagner said, “It was like coming home.” ■ (Neil Roland and Chrissie Thompson are reporters with Automotive News, a sister publication of Crain’s Cleveland Business.)
Now Offering an MBA Why an MBA from Ursuline? Designed for the working professional, Ursuline’s MBA program offers courses that meet once a week for five to six weeks and some that are entirely online. Choose from four dynamic concentrations developed in response to employment trends: Marketing and Communications, Health Services, Entrepreneurial and Ethical Leadership, Financial Planning and Accounting. Prospective students are evaluated not only on undergraduate GPA, but also on related work experience. In recognition of strong academic achievement, Ursuline will waive the GMAT requirement. For more information or to schedule an appointment contact Ursuline’s Office of Graduate Admission at 440 646 8119 or graduateadmissions@ursuline.edu
We’re open for business. America’s business. Give us a call and let us prove it. Dave Bozak Business Sales Manager 216-896-1032
attrition and the elimination of four brands. The number of dealers who have accepted GM’s reinstatement offers is in the “high 500s” and rising, Mr. Reuss said. More than 380 dealerships are still pursuing arbitration, often because GM hasn’t had time for all of its one-on-one meetings, he said. “We’re working that down,” Mr. Reuss said.
Bill Larion Client Manager Team Leader 216-623-9276
ursuline.edu 1 888 URSULINE
20100517-NEWS--21-NAT-CCI-CL_--
5/14/2010
10:29 AM
Page 1
CRAIN’S CLEVELAND BUSINESS
MAY 17-23, 2010
INSIDE
FINANCE
23 NEW DANTE RESTAURANT MAKES A BIG INVESTMENT.
UP AGAINST A WALL Complex issues arise when employees’ financial troubles enter workplace By ARIELLE KASS akass@crain.com
I
n March, word got out that more than 70 Defense Finance and Accounting Service employees had already lost their jobs, or were about to, because of bad credit. The government agency put the firings on hold later in the month, but with tough economic times persisting even for those
Credit counselors still see influx of heavily leveraged clients By CHUCK SODER csoder@crain.com
T
he corporate world seems to be recovering from the recession faster than a lot of people in Northeast Ohio. Several area organizations that serve people with money problems say they haven’t seen any drop-off in people looking for help in recent months. Their problems haven’t gotten any lighter, either. The picture stands in stark contrast to what has for the most part been a fairly steady start to recovery for the stock market and corporate profits. Jay Seaton, area president for the nonprofit Consumer Credit Counseling Service, part of the Columbus-based Apprisen family of financial services agencies, said the number of Northeast Ohio residents scheduling appointments has leveled off after increasing by between 10% and 20% in 2008 and 2009. However, they’re still coming in droves, and a See CREDIT Page 22
who are employed, personal finances continue to bleed into individuals’ work lives. It’s rare to see employees lose their jobs because of a bad credit score, said Peter Hardin-Levine, president of the Cleveland law firm Thorman & HardinLevine. However, an increasing number of employers are doing credit checks See PERSONAL Page 22
21
20100517-NEWS--22-NAT-CCI-CL_--
5/14/2010
10:30 AM
Page 1
22 CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
FINANCE
Personal: Stress creates bigger problems continued from PAGE 21
before hiring someone, particularly for positions where a worker would have some degree of fiduciary responsibility. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s becoming a more common practice,â&#x20AC;? Mr. Hardin-Levine said. â&#x20AC;&#x153;The theory is if an employee is getting into a more desperate financial situation, heâ&#x20AC;&#x2122;s more inclined to do something inappropriate at work.â&#x20AC;? Some services notify employers if their workers declare bankruptcy, Mr. Hardin-Levine said, or fail to pay their bills for a certain number of months. And because Ohio is an at-will employment state, those reasons are as good as any for choosing to lay an employee off. However, Stephen Zashin, co-managing partner and head of labor and employment at Zashin & Rich Co., said legislation requires employers to tell workers if they are denied a job or let go because of a credit check. There is a push to eliminate an individualâ&#x20AC;&#x2122;s financial information from accessibility at all.
Mr. Zashin said some companies or agencies, such as the Defense Finance and Accounting Service, can be required by law to check someoneâ&#x20AC;&#x2122;s credit. But if someone loses a job due to a poor credit score â&#x20AC;&#x201D; or isnâ&#x20AC;&#x2122;t hired in the first place â&#x20AC;&#x201D; it can create a â&#x20AC;&#x153;vicious cycle,â&#x20AC;? Mr. Zashin said. â&#x20AC;&#x153;You canâ&#x20AC;&#x2122;t really dig yourself out of that,â&#x20AC;? he said. Joel Rathbone, co-managing partner of the law firm Javitch, Block & Rathbone, said he has been doing credit checks for about a year now. So far, though, he said it hasnâ&#x20AC;&#x2122;t really been a problem for potential hires. â&#x20AC;&#x153;Like every employer, we hire people who run into financial difficulties throughout their lives,â&#x20AC;? he said. â&#x20AC;&#x153;We havenâ&#x20AC;&#x2122;t had anyone apply for a fiduciary job with credit issues.â&#x20AC;? Mr. Rathbone said the main reason he checks credit is because of clients who need to make sure his employees can see their data. He said in and of itself, he does not believe that credit is pertinent, but
he called it one of many tools that can help assess internal risk factors.
Body is there, head isnâ&#x20AC;&#x2122;t Lenny Sanicola, practice leader for benefits at WorldatWork in Scottsdale, Ariz., said often, people who have financial concerns can suffer from â&#x20AC;&#x153;presenteeismâ&#x20AC;? â&#x20AC;&#x201D; while their bodies are at work, their minds are not. â&#x20AC;&#x153;People that are at work and stressed out about their money situation are not going to be productive,â&#x20AC;? Mr. Sanicola said. â&#x20AC;&#x153;If people are stressed out and worrying about money, theyâ&#x20AC;&#x2122;re not focusing on their job.â&#x20AC;? Mr. Sanicola said employees who donâ&#x20AC;&#x2122;t have financial issues also wonâ&#x20AC;&#x2122;t be on the phone at work with credit card companies or bill collectors. Not all personal financial issues that make their way into the workplace deal with an individualâ&#x20AC;&#x2122;s credit. Wage garnishments up to 25% of an employeeâ&#x20AC;&#x2122;s net pay can
Credit: More individuals saving money continued from PAGE 21
lot of them are in deep financial trouble, he said. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re seeing a significant chunk of people who canâ&#x20AC;&#x2122;t stretch their income, are unemployed and at some point theyâ&#x20AC;&#x2122;re going to reach out to an attorney and consider filing for bankruptcy,â&#x20AC;? Mr. Seaton said. Others in the region echoed his
sentiments. The number of people seeking help from the Legal Aid Society of Cleveland â&#x20AC;&#x153;just keeps increasing,â&#x20AC;? said Melanie Shakarian, spokeswoman for the group, which helps people having money troubles with legal issues. She said the group plans to host 50 clinics in Northeast Ohio this
year, up from 40 in 2009 and 35 in 2008, and some of the sessions are drawing twice as many people as they used to.
New set of troubles Peopleâ&#x20AC;&#x2122;s problems are somewhat different today than at the start of the recession, Ms. Shakarian said. For instance, fewer clients
!CT NOW /PEN ENROLLMENT THROUGH -AY
Un-Complicated
Workersâ&#x20AC;&#x2122; Solutions.
!T (-3 WE´RE ALL ABOUT SOLUTIONS !ND BECAUSE WE WANT YOUR WORKERS´ COMPENSATION PROGRAM TO RUN AS EF½CIENTLY AS POSSIBLE WE PROVIDE YOU WITH OUR ADVANCED ONLINE CLAIMS TOOL 6ISIT WWW HMSSOLUTIONS COM OR CALL
be withheld from a paycheck for debts such as car loans, credit cards, apartment lease deficiencies or unpaid child support, said Weltman, Weinberg & Reis Co. partner Sara Donnersbach. Ms. Donnersbach said people donâ&#x20AC;&#x2122;t generally disclose their debts broadly, but that someone in the payroll department would need to know if a personâ&#x20AC;&#x2122;s wages were being garnished. She said that can have an impact on a worker personally, and that can carry into a job. â&#x20AC;&#x153;Owing bills to somebody adds a lot of stress on a person,â&#x20AC;? she said. â&#x20AC;&#x153;It does really weigh on them.â&#x20AC;? While employers cannot fire an employee for having one wage garnishment, Ms. Donnersbach said, it is legal to discharge a worker who has more than one wage garnishment in place.
Changing times Bradley A. Sherman, a shareholder at employment law firm Littler Mendelson in Cleveland, said if an
whose homes are being foreclosed on are in the situation because they took out a mortgage they couldnâ&#x20AC;&#x2122;t afford, she said. Theyâ&#x20AC;&#x2122;re in the situation today because they lost their job or got hit with major medical expenses while without health insurance. And itâ&#x20AC;&#x2122;s not just unemployment: She noted many people are having trouble paying bills because they have taken pay cuts or had to take lower-paying jobs after being laid off. â&#x20AC;&#x153;Weâ&#x20AC;&#x2122;re helping more individuals who do have jobs, but theyâ&#x20AC;&#x2122;re very low-paying jobs,â&#x20AC;? she said. The length of time some people have been out of work has compounded problems for clients seeking help from WECO Fund Inc., said Esther Holtwick, financial education director for the Cleveland-based group, which provides financial classes and coaching to people with low or moderate incomes. The same goes for clients of the Consumer Credit Counseling Service: The group has been seeing more people whoâ&#x20AC;&#x2122;ve exhausted their unemployment benefits over the last six months, Mr. Seaton said. Some of WECOâ&#x20AC;&#x2122;s clients come in long after their unemployment payments run out, Ms. Holtwick said. â&#x20AC;&#x153;As unemployment goes on longer, there are more opportunities for people to default on their payments,â&#x20AC;? she said. The fact that the nationâ&#x20AC;&#x2122;s unemployment rate stands at about 10% has been driving demand for financial counseling, said David Jones, president of the Association of Independent Consumer Credit Counseling Agencies, a national group representing nonprofit credit counseling companies. But, he too, said demand seems to be leveling off.
A penny saved â&#x20AC;Ś
Š2010 Paramount Preferred Options
Member of ProMedica Health System
While continuing unemployment and foreclosures make Mr. Jones worry about whether peopleâ&#x20AC;&#x2122;s situations will improve, he is glad that the national savings rate has increased. The average U.S. resident saved 3% of their income in the first quarter of 2010, which is up from just over 1%
individual is a â&#x20AC;&#x153;borderline employee,â&#x20AC;? some financial setbacks may be used as a reason to get rid of someone. He also said that someoneâ&#x20AC;&#x2122;s behavior on the phone with credit collectors or others to whom he or she owes money could affect co-workersâ&#x20AC;&#x2122; perceptions of a person, or make them uncomfortable. Mr. Sherman said he has had more clients asking questions about what they can and cannot do legally as they explore looking into job candidatesâ&#x20AC;&#x2122; and employeesâ&#x20AC;&#x2122; finances. Mr. Sherman said some employers believe that if an individual cannot keep his own financial house in order, he may not be able to work effectively. Still, Mr. Sherman said people do not tend to get fired for bad personal finances, and while it may make it less likely that they would get hired for a job, he thinks as the recession persists and more people deal with financial issues, he expects the acceptance of such lapses to increase. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s the world we live in at this point in time,â&#x20AC;? he said. â&#x20AC;&#x153;There are more people with black marks on their credit ranking. The global acceptance standards for what makes a good citizen, or a good candidate for employment, have changed.â&#x20AC;? â&#x2013;
in the first quarter of 2008 but down from a recessionary peak of more than 5% in the second quarter of 2009, according to figures from the U.S. Department of Commerce. The people who have lost jobs or otherwise suffered serious financial setbacks during the recession wonâ&#x20AC;&#x2122;t return to their free-spending ways soon, he said. â&#x20AC;&#x153;That will make an indelible impact on them,â&#x20AC;? he said. Cleveland Saves, a coalition of nonprofit, financial, corporate and government groups, is encouraged by the improved savings rate as well, said executive director Elizabeth Hilton. The number of people who attend the financial workshops that Cleveland Saves puts on across the region has increased even in the last six months, especially when the group hosts events for nonprofits that provide employment-related services, Ms. Hilton said. The recession drove both WECO and Cleveland Saves to talk more about debt reduction than saving money. Ms. Hilton noted, however, that people have been quick to accept the fact that they have to make changes, maybe because they see how the recession has affected people close to them, she said. â&#x20AC;&#x153;Because this is happening to everybody, people are more prepared,â&#x20AC;? Ms. Hilton said. She lauded Ohio passing a law in January 2007 that will require high schools to mix a few hours of financial literacy training into their curriculums starting this fall. Mr. Seaton, of Consumer Credit Counseling Service, said a new federal law requiring credit card bills to spell out how long it would take cardholders to pay off their debt if they make only minimum payments has been especially effective. His agency has talked to five people who specifically said that the information drove them to change their habits. The simple solution, of course, is for people of all income levels to remember one basic yet oft-forgotten rule that Ms. Holtwick and others at WECO are known to repeat. â&#x20AC;&#x153;Spend less than you earn, and own more than you owe,â&#x20AC;? she said. â&#x2013;
20100517-NEWS--23-NAT-CCI-CL_--
5/14/2010
10:29 AM
Page 1
MAY 17-23, 2010
CRAIN’S CLEVELAND BUSINESS 23
WWW.CRAINSCLEVELAND.COM
FINANCE
PLACESOFNOTE A look at Northeast Ohio’s interesting spaces
Dante THE PLACE: The Tremont restaurant opened in January in a building that used to house a bank. By KATHY AMES CARR kcarr@crain.com
T
he façade of a building in Cleveland’s Tremont neighborhood looks like a renovation project that is a work in progress. Beneath a horizontal sign that says “Dante,” the front door bears a decal that reads: “Federal Savings and Loan Insurance Corp., Safety Of Your Savings Insured Up to $10,000.” But if anything, Dante is a work of progress — a former branch of Third Federal Savings and Loan of Cleveland that has been repurposed into a restaurant that opened in January. The building — which had been a bank for more than 80 years — serves as an example of how one might cash in on the unique features of a former financial institution, reinventing an old facility for modern use while retaining its historic character. Third Federal occupied the building for almost 50 years, from 1958 to 2007, at which point it consolidated its operations into the Ohio City
branch on West 25th Street, said spokeswoman Jennifer Rosa. Lincoln Heights Savings and Loan previously had been in the building since 1924. Chef and owner Dante Boccuzzi, along with a local architect, artist and contractor, in March 2009 began retrofitting the building to accommodate the eatery, which serves contemporary American cuisine, while preserving its institutional artifacts, including the vault. “I wanted to preserve the historic character of the building,” Mr. Boccuzzi said.
Meet me in the vault Mr. Boccuzzi’s preservation of the bank vault perhaps is the restaurant’s most significant investment. The vault lists on its door York Safe and Lock Co. of Cleveland as one of its manufacturers. “The vault represents a great piece of Cleveland’s industrial history,” said Giancarlo Calicchia, an artist who helped design the interior of the building, which he owns and rents out. Diners who sit at the table located within the vault face a space that used to house safety deposit boxes; it now functions as a room to refrigerate and display meat. The 1-inch thick metal frame and concrete surrounding the vault made it nearly impossible to drill a 6-inch hole for ventilation into the inner space designated for meat display. So even if Mr. Boccuzzi wanted to
PHOTOS PROVIDED
LEFT: The building underwent a renovation in 2009, and now Dante, a contemporary American restaurant, is located there. RIGHT: The vault now features a table for four, and it is the restaurant’s most requested dining spot. remove the vault, he would have required the kind of manpower needed to build the ancient pyramids. “And it took 40 hours of elbow grease just to shine the door,” he said. Architect Paul Beegan of Beegan Architectural Design LLC in Lakewood said the renovation was one of the most unique building conversions he’s worked on because of its age and design, but the biggest challenge was incorporating a kitchen and bar into the space. Ultimately, the team, which also included Scalish Construction in Cleveland, combined the restaurant with the vacant drapery shop building next door for more space. Construction was completed at the end of 2009. Similarly, Touch Supper Club in Ohio City is located in a building rich with history, including its first
purpose as a bank, said president Robert Ivanov. The supper club also has an embedded vault, a conversation piece indeed, and it serves as a reminder of the building’s past, which dates to the early part of the 20th century. “You’d have to pry it out with a crane,” Mr. Ivanov said. “I think the building was built around the vault.”
You want a loan? In an ironic touch, Mr. Boccuzzi said the most challenging part of the renovation was finding money to pay for the bank’s conversion into a restaurant. “I couldn’t get a loan anywhere,” he said. Because banks have restricted lending since the recession, Mr. Boccuzzi and his partners had to
raise on their own the $1 million needed to pay for the renovation. He also applied for a $37,000 loan and a $3,000 grant from the city of Cleveland, a process that took months. Based on recent sales and patron waiting lists, he expects the investment to pay for itself in three years. Meanwhile, some of Third Federal’s remaining artifacts will be incorporated into Mr. Boccuzzi’s new venture — Ginko — a sushi bar slated to open by early 2011 in Dante’s basement. Those items include teller pane glass and the built-in pens used at tables that supply deposit and withdrawal slips. “People will be able to use them to sign their checks or place their orders on an order slip,” Mr. Boccuzzi said. ■
RHN HPG RHNK HPG ;NLBG>LL' F:R;> BMÍL MBF> MH HPG RHNK HPG ;NBE=BG@'
Buying or re-financing with historically low rates makes today a great day.*
5.99
%
Owner - Occupied Commercial Real Estate Loan UÊfÓxäÊ vvÊV à }ÊV ÃÌÃ\Ê > ÃÊÕ«ÊÌ ÊfÓxä]äää UÊfxääÊ vvÊV à }ÊV ÃÌÃ\Ê > ÃÊfÓxä]äää fxää]äää UÊf£]äääÊ vvÊV à }ÊV ÃÌÃ\Ê > ÃÊ ÛiÀÊfxää]äää
Ready to refinance? Talk to a Huntington Business Banker or call 1-800-976-1345.
Our low limited-time rate makes this the perfect time to buy or re-finance. Today is a new day. And as Ohio’s #1 SBA lender, we’re here to make today your day.
All applications subject to standard credit review and approval. Special rates shown are as of April 15, 2010 and require a Huntington primary checking account. Rates subject to change without notice based on market conditions. Special rate and discounted closing costs offer available only for loan applications less than or equal to $2,500,000. Qualified closing costs are those associated with commercial real estate transactions, such as property evaluation, title search, flood determination, and mortgage recording fees. May not be applied to the origination fee nor Small Business Administration or other government loan program enrollment and processing fees. Borrower must pay 50 basis points origination fee plus standard closing costs. Standard prepayment penalty applies. *Refinances of existing Huntington business loans are excluded. Must apply by May 28, 2010 to qualify for offer. Loan must close within 60 days of approval. Offer only available on 5-year term loan with up to 20-year amortization. All credit requests subject to review and approval. SBA loans subject to SBA eligibility. Small Business Administration ranking is based on the 2009 Coleman Report 500 for Top 50 7(a) Lenders by Number of Loans and Loan Volume in Ohio and West Virginia and Number of Loans in Indiana and Michigan, for fiscal year end on September 30, 2009. Member FDIC.
®
and Huntington® are federally registered service marks of Huntington Bancshares Incorporated. © 2010 Huntington Bancshares Incorporated.
20100517-NEWS--24-NAT-CCI-CL_--
24
5/14/2010
CRAIN’S CLEVELAND BUSINESS
2:38 PM
Page 1
WWW.CRAINSCLEVELAND.COM
MAY 17-23, 2010
RENDERINGS PROVIDED
Hillcrest Hospital is updating its dark brick exterior with a 21st-century look of white stone and large windows.
Hillcrest: Private rooms enhance patient comfort continued from PAGE 3
The emergency department also has spaces where physicians and nurses quickly can see patients who do not need to be admitted, Ms. Aronson said. For instance, if a patient comes into the emergency room with an ear infection, he or she can be assessed quickly and sent home with a prescription, without being near more seriously ill patients. “Our goal is around efficiency and speed, but also the patient experience,” said Jeff Leimgruber, president of Hillcrest.
Quite a squeeze The hospital is housing the pediatric emergency department in a temporary space until the 12 new private rooms are completed in December, Ms. Aronson said. Hillcrest currently sees about 18,000 children in its emergency department each year, Mr. Leimgruber noted. When finished, the 40,000-squarefoot emergency department will be able to handle up to 70,000 adult and pediatric patients annually, Ms. Aronson said. The previous, 14,000square-foot emergency department was built to care for 25,000 patients each year but squeezed in about 58,000 in 2009. The five-story Jane and Lee Seidman Tower has been added to the front of the hospital to create a new entrance and look to the hospital. Eight new operating rooms will open in October to give Hillcrest a total of 22 operating rooms, Ms. Aronson said. The second floor of the tower will house the new neonatal intensive care unit, or NICU. The existing NICU has 15 Level II rooms, but the new NICU will have a total of 24 Level III rooms, all of which can accommodate multiple baby incubators if needed, she said. The medical staff helped design the rooms throughout the new tower to make their jobs easier, Ms. Aronson said. For example, nursing stations were built between every two rooms in the NICU so nurses could see inside each room while working. Each nurse in the NICU typically is assigned to two rooms at a time, she said. Some rooms also are adjoining in
case parents have more than one baby in the NICU, which is becoming more common as more women wait longer to have children and use fertility drugs, which increases the likelihood of multiple births, Ms. Aronson said. Babies can be in the NICU up to four months, so Hillcrest built a small apartment-style space where families with older children can relax and have a meal. There also are two hotel-type rooms for parents to stay overnight or do laundry free of charge. Nurses likely will give those rooms to parents with the greatest need, she said. The other three floors of the tower are dedicated to adult patient rooms, each of which has been designed to allow for more privacy and to promote a quieter atmosphere than in most hospitals, she said.
A little privacy Hillcrest is the latest local hospital to build single-patient rooms, which is what people are looking for in medical care, Ms. Aronson said. Each room has a flat screen TV and the bed is around the corner from the door, which prohibits people from seeing the patient if the door is open. The medical staff asked that storage cabinets be padded so the doors will shut quietly. Some cabinets also open to the room and the hallway outside so hospital staff can stock the room without disturbing the patient. Nurses insisted that couches be put in every room so multiple family members can sit or lie down, Ms. Aronson said. The designer initially planned to put a single chair in each room, a common feature in hospitals in recent decades, she said. But while many hospitals have built and remodeled rooms to look more like hotel rooms designed with dark wood trim, ceramic tile and earth-toned walls, the Clinic has chosen a more sterile look that includes white walls, light-wood cabinets and steel trim offset by artwork. Ms. Aronson said the approach has worked. “Patients are not distracted by different colors on the walls and the art can be a tool of way-finding,” she said. ■ Hillcrest will feature more white walls, steel and glass, which is seen in this rendering of a surgery room. The elements are consistent with the design vision of Cleveland Clinic CEO Dr. Delos “Toby” Cosgrove.
20100517-NEWS--25-NAT-CCI-CL_--
5/14/2010
1:31 PM
Page 1
MAY 17-23, 2010
Cars: Firms eye commercialization continued from PAGE 3
for those batteries, which are used in cars such as the Prius and the Toyota Highlander that Mr. Deluca’s wife drives. Right now, the automotive market represents a tiny portion of overall demand for the cobalt and cobaltbased materials that OM Group produces. By 2015, however, that market could account for one-third of all demand for those materials, as more people start driving hybrid electric and all-electric cars, said Mr. Deluca, vice president and general manager of inorganics at OM Group. “There’s quite a potential for growth here,” he said. Companies throughout the area are working to capitalize on the growing market created by hybrid electric and all-electric cars, be it by producing battery materials, hybrid electric drive trains or even entire vehicles, such as the colorful three-wheelers of Myers Motors in Tallmadge. BASF Catalysts, for one, was awarded $24.6 million in federal stimulus money last August to build what the company expects will be one of North America’s largest cathode material production plants. The cathodes it makes will go into lithium-ion batteries, which will be used in plugin electric cars such as the Chevrolet Volt and the Nissan Leaf. Construction of the new plant, to be located near another BASF operation at 120 Pine St. in Elyria, is slated to start in early 2011, with production beginning in 2012, said Joseph Jones, spokesman for BASF Catalysts, part
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
of German chemical giant BASF SE. The plant is expected to support 20 to 30 jobs when it first opens. “Ultimately we’re going to mass produce and market these chemicals,” Mr. Jones said. Novolyte Technologies Inc. in Independence that same month was awarded $20.6 million in stimulus money, which it is using to expand production of lithium-ion battery electrolytes at its plant in Baton Rouge, La. It also is adding a few people at its local research and development center. Novolyte, which used to be part of Ferro Corp., a specialty chemicals company based in Cleveland, might end up doing more work in Ohio as it expands to accommodate demand for automotive batteries, said CEO Ed Frindt. Such a move would depend on whether many battery makers set up operations in the Midwest, he said. He cited a few lithium-ion battery companies with operations in the region: EnerDel Inc. is based in Indianapolis, and both A123 Systems and Dow Kokam have operations in Michigan and plan to expand there. OM Group’s Finland plant has started producing a combination of nickel, cobalt and manganese, which would be used to make cathode material for lithium-ion batteries. In addition, the company last December bought EaglePicher Technologies LLC of Joplin, Mo., for $172 million, partly because of its expertise in lithium-ion batteries. EaglePicher already makes them for other markets, Mr. Deluca said.
Big companies, big trucks Two of Northeast Ohio’s biggest manufacturers, Eaton Corp. and Parker Hannifin Corp., already are selling or are preparing to sell battery-based hybrid systems and hydraulic hybrid systems for use on large vehicles. Eaton, based in Cleveland, spent five years refining its battery-based hybrid technology for large vehicles before it began selling the drive trains broadly in 2007, said Dimitri Kazarinoff, vice president and general manager of Eaton’s Hybrid Power Systems division. “We are now getting orders in the hundreds (of drive trains) from industrial customers,” Mr. Kazarinoff said. Customers include FedEx, PepsiCo and Florida Power & Light. Eaton soon plans to release a hydraulic hybrid system, which stores energy by compressing fluid and releases it to provide large amounts of power quickly. The company eventually could produce hybrid technologies for consumer automobiles, though it likely would start with bigger vehicles, such as pickup trucks, Mr. Kazarinoff said. Parker Hannifin, of Mayfield Heights, also is on the verge of commercializing a hydraulic hybrid system. It has commitments to deliver 11 of the systems to a handful of governments in southern Florida that tested the technology in garbage trucks last summer, and it has received a commitment to provide hundreds of them for UPS delivery trucks as
part of a stimulus-financed project. Like OM Group, Parker also has made an acquisition that should help it capitalize on the burgeoning hybrid vehicles market: Last September, it announced it had bought Lingk & Sturzebecher under undisclosed terms. The German company’s composite material technology will help Parker develop lighter hydraulic components for its hybrid systems. Some truck drivers who have tested Parker’s technology are left bewildered at how much fuel they save, said Joe Kovach, group vice president of technology and innovation for Parker’s Hydraulics Group. “When you can cut fuel use by 50%, that’s no game,” Dr. Kovach said.
You don’t need plutonium Area startups are pursuing the hybrid market, too. XR3 Holdings is technically based in Phoenix, but majority owner Bob Riley said the company’s XR3 hybrid electric car will be built in Northeast Ohio if he and his Ohio-based business partner, Phillip Lane, can raise capital for production. The prototype — a silver three-wheeler with a diesel engine that complements electricity from a battery — is stored in a downtown Cleveland building, Mr. Riley said. Mr. Riley decided to locate the company’s operations here mainly
because he thought there might be government money available for new ventures in the area, given its economic troubles. The availability of inexpensive manufacturing space was another draw, he said. The region has the capacity to be a bigger player in the space, according to Mr. Riley, who noted that he’s worked with Ohio State University’s Center for Automotive Research, fuel cell experts at Case Western Reserve University and Myers Motors, a maker of small cars that run purely on electricity. “The expertise is there,” he said. No region has established dominance in the electric vehicle field, though the Detroit area has a clear head start, said Brian Wynne, president of the Electric Drive Transportation Association in Washington, D.C. Regions with expertise in advanced manufacturing, battery management systems, electronics and software will have advantages, Mr. Wynne said. Pure electric cars are expected to have fewer parts under the hood than today’s cars, which could pose a threat to traditional parts makers. However, Mr. Wynne said traditional engines will be needed as part of hybrid systems for a long time. “We’re not going to put the combustion engine out of business any time soon,” he said. ■
:+< +,5(
,17(516"
>> FILL YOUR TALENT PIPELINE
Mittal: Demand remains a question continued from PAGE 1
and keeping the plant secure. Also, at this time last year, not a single pellet of iron ore had been delivered to the Port of Cleveland, compared with the nearly 296 tons that were brought in by April 30 this year, said Brent Leslie, chief financial officer for the Cleveland-Cuyahoga County Port Authority. Iron ore is the key ingredient in the steelmaking process. “With the mill idled for most of the year, we didn’t have any iron ore until late in the third quarter,” Mr. Leslie said. He noted that iron ore is by far the port’s most important and, usually, its most prevalent cargo. While business is better, there’s no telling when — or if — it’s likely to return to levels that existed before the deep recession. At 100% capacity, Mr. Granakis’ local would need about 1,450 members to run the plant. To reach that level, the company would need to hire for the first time in years steelworkers who are new to the industry. It’s possible ArcelorMittal could
face that issue next year, but probably not before, the company predicts. “Going forward, we are still anticipating that apparent demand will continue to increase progressively in the U.S., but it will remain around 20% to 25% lower in 2010 than pre-crisis levels,” Ms. Patterson said. Still, Mr. Granakis said he only has 63 workers from the mill on forced layoff. “That’s a lot better than where we were,” he said. When and whether the mill increases production will depend on how much steel is needed by the nation’s manufacturers, and ArcelorMittal says that demand is still rising. The company thinks restocking in the automotive market is leading the way, but other consumer industries that use steel are following, and steel service centers that distribute the metal have been increasing their inventories as well, Ms. Patterson said. Chicago-based Steel Market Intelligence, which advises clients on the current conditions and future directions of the steel markets, predicts demand and prices for steel will
QUIZANSWERS Answers to our 30th anniversary quiz, which can be found on Page 19: 1. b, 1986 2. b, Richmond, Va. 3. a, Progressive Corp. 4. b, 52% to 48%, and 28,000 jobs 5. d, 30 6. b, Alton Whitehouse Jr. 7. a, “Air Force One” 8. a, 0 9. b, At the Tower City complex, overlooking the Cuyahoga River on
West Huron Road 10. d, 1982 11. c, Rite Aid Corp. 12. b, $530 million 13. d, 1.1 million 14. d, Frank Jackson 15. b, CreataCard 16. c, Christopher Connor of Sherwin-Williams Co. 17. d, Ray Shepardson 18. a, FirstEnergy Corp. 19. b, Captain Frank’s 20. c, Crain’s Now!
continue to rise through 2010. The firm, in its April report on steel service center inventories, noted that flatrolled steel — like the kind ArcelorMittal makes here — is enjoying a particularly strong market because of both increasing demand and limited supply. ArcelorMittal and other steel producers in the United States have been careful not to rush to employ too much of their capacity and drive down prices for their steel. Locally, the Cleveland Works has both its blast furnaces working to convert ore to iron, but only one of two steelmaking facilities operating to turn the iron into finished steel, Mr. Granakis said. ■
25
>> WORK WITH POTENTIAL HIRES >> INCREASE ACCEPTANCE OF JOB OFFERS AND RETENTION
>> GAIN AFFORDABLE, INNOVATIVE INPUT
visit www.neointern.net to find your next intern
learn. earn. intern.
20100517-NEWS--26-NAT-CCI-CL_--
26
5/14/2010
10:31 AM
CRAIN’S CLEVELAND BUSINESS
Contact: Phone: Fax: E-mail:
Genny Donley (216) 771-5172 (216) 694-4264 gdonley@crain.com
Page 1
WWW.CRAINSCLEVELAND.COM
REAL ESTATE AUCTION
AUCTION JUNE 8 OFFERED REGARDLESS OF PRICE BY COURT ORDER! 400 N. State St., Medina, OH 44256 10,831 Sq. Ft. Show-room/ Warehouse on 2.95-Acres; Zoned I-1. 18' Ceilings; 2 Drive-Ins; 1 Dock; minutes from I-271, I-71 & I-80 (Ohio Turnpike). Suggested Opening Bid: $50,000 300 N. State St., Medina, OH 44256 12,890 Sq Ft. Former Concrete Block Plant on 3.42-Acres. 16'-22' Ceilings; Rail Served; Multiple Docks. Suggested Opening Bid: $20,000 800-820 Progress Dr., Medina, OH 44256 10,950 Sq. Ft. Metal Panel Maintenance/ Warehouse on 22+ Acres; Zoned I-1. Minutes from I-71, I-271, I-76 & I-80 (Ohio Turnpike). Suggested Opening Bid: $45,000
10232 Pifer Rd., Wadsworth, OH 44281 Former Ready Mix Concrete Plant w/ 5,112 SF Truck Storage Bldg, on 8.83-Acres; Zoned I-2. Minutes from I-71, I-271, I-76 & I-77. Suggested Opening Bid: $15,000 1151 W. Bagley Rd., Berea, OH 44017 Zoned BRCD (Berea Rd. Commercial) Frontage on W. Bagley & Berea Ind. Pkwy. Located minutes from Hopkins Airport, I-71, I-480 & I-80 (OH Turnpike) Suggested Opening Bid: $30,000 N. State St., Medina, OH 44017 (Adjacent to the North End of 400 N. State St.). 4.6-Acre Development Site. 350' of Frontage on N. State St., Zoned I-1; minutes from I-71, I-271, I-76 & I-80 (OH Turnpike). Suggested Opening Bid: $10,000 Steels Corner Rd. & Wyoga Lake Rd., Cuyahoga Falls, OH - Located on the SW corner, this 5.45 acre development site is zoned E-1 which permits a variety of commercial & light industrial uses. Minutes from SR 8, I-76, I-77, and I-80 (OH Turnpike) Suggested Opening Bid: $40,000
Inspections for All the Above Properties at 400 N. State St., Medina, OH May 20, 27 & June 3, from 1:30 to 3:30 PM 2301 Progress St., Dover, OH 44622 3251 Brightwood Rd., Midvale, OH 44653 26,560 Sq. 14,178 SF Corp. Ft. Ind./ Office on 6-Acres. Warehouse Contact Broker for on 5-Acres; Current Occupancy Info. Adjacent to New I-77 Schneider’s 20' Ceilings; 6 Drive-Ins & 1 Dock, Crossing Interchange. Easy Access SR 250. Fenced lot. Easy Access to I-77 & SR 250. Suggested Opening Bid: $150,000 Suggested Opening Bid: $45,000 On-Site Inspections for Both the Above Properties May 20, 27 & June 3, from 10:00AM to 12:00 NOON
OFFERED ABSOLUTE, REGARDLESS OF PRICE! FORMER LAKE BUSINESS PRODUCTS HEAD QUARTERS 38322 Apollo Pkwy., Willoughby, OH 44094 - 20,334 SF Office/Warehouse on 1.2 Acres; Zoned L-1. Minutes from I-90, Rt 2 & I-271; 1 Drive-In & 1 Loading Dock. 5,000 SF 2nd Floor Lease in Place. Suggested Opening Bid: $145,000 ON-SITE INSPECTIONS: May 20, 27 & June 3, 1:00 - 3:00 PM
FORMER SUTTON HARDWARE BUILDINGS
2155 St. Clair & 2126 Hamilton Cleveland, OH 44114 - SOLD AS ONE PARCEL. St. Clair: 6,500 Sq. Ft. Retail, Office, Warehouse with Dock & 2 BR Rental Apt., Zoned: Com. Hamilton: 4,000 Sq. Ft. Garage/Warehouse Bldg. 1 Drive Thru Bay & 1 Drive-In Door. Suggested Opening Bid: $45,000 ON-SITE INSPECTIONS: May 19, 26 & June 2, 10:00 AM- 12:00 NOON
OFFERED WITH A BELOW-MARKET PUBLISHED RESERVE! MOHICAN RIVER INN & EVENT CENTER — Loudonville, OH Jacuzzi Suites; Owners Townhome; & Addl. Apartment. Event Center for groups to 150; The Pavilion; The Meadow; Fern Landing; & Stargazer Playground. Restaurant w/ Liquor License and Commercial Kitchen. Mohican River Inn: over-looking river, in Canoe & Camping Capital of Ohio. — Lakeview Holdings Directs Sale — 16124 Country Rd. 23, Loudonville, OH PUBLISHED RESERVE: $397,00 44842. Exit 204 off I-71, S. on OH-83 to BIDDING COMMENCES @ $260,000 OH-3, SW. to Wally Rd., Scenic Byway ON-SITE INSPECTIONS: (CR 23), E, 5 miles to Site. Built 1980’s & May 21, 28, & June 5: 2 - 4 PM Recently Renovated. Room types include www.mohicanriverinn.net 42 Double-Doubles; 6 Kings including two
For Brochure, Terms of Sale & Bid Packet Call: 216-360-0009
C o u r t - O r d e r e d
Real Estate Auction May 26 • 11:00 AM On-Site
50,000 Sq.Ft. Multi-Tenant Building on 3.4 Acres Buy @$5/Sq.Ft. 3618 Apache St NW, Uniontown Stark County Parcel 22-02573 Bambeck Auctioneers Inc. www.bambeck.com
ARE YOU READING THIS? This small ad space could bring BIG BUSINESS.
Contact Genny Donley at (216) 771-5172
OFFICE SPACE FOR SALE OR LEASE
Cleveland/Shaker Hts. Historic AmTrust building, N. Moreland & Larchmere. 1,000 s.f. to 8,000 s.f. from trendy & modern to well appointed & distinguished. Free parking • Kitchen Facilities • Large Training Room/Classroom Space • Conference Room. For additional information contact
Fairmount Properties 216-514-8700 New Solon Office Building
CHARTWELL AUCTIONS/CHARTWELL GROUP, LLC
BUSINESS OPPORTUNITY NOTICE OF BUSINESS OPPORTUNITY The Cleveland Airport System of the City of Cleveland is soliciting proposals from persons and firms that have the requisite, demonstrable competence and experience in setting benchmarking standards for the Custodial Services Department at Cleveland Hopkins International Airport. Interested parties may obtain a copy of the Request for Proposals, free of charge, under the Business Information section at www.clevelandairport.com; by calling (216) 265-6086; by written request addressed to Procurement Section, Department of Port Control, 5300 Riverside Drive, P. O. Box 81009, Cleveland, Ohio 44181-0009 or by e-mail to dcartellone@ clevelandairport.com. Proposals are due by 4:00 p.m. EDT Friday, July 9, 2010
BUSINESS SERVICES
www.CrainsCleveland.com/LoopNet
For advertising opportunities contact Genny Donley gdonley@crain.com 216-771-5172
Crain’s Executive Recruiter Sales – Large Machining & Fabrication We have an immediate opening for a sales professional with experience in LARGE MACHINING AND FABRICATION. Primary responsibility will be to identify and pursue customers whose needs match up with the Company’s unique capability to fabricate and/or machine extremely large parts. Engineering/technical background a plus, but not required. Knowledge of drawings and technical specifications required. You must be a solid communicator, have the ability to work closely with others in a team environment and be a self starter with an intense desire to land and maintain new business. Your office will be located at our production facility in Cleveland, with some travel required. Position reports to President or VP-Operations, depending upon qualifications and experience. We have the flexibility to tailor a compensation package to the individual, depending upon qualifications, experience and value to our Company. Emails only to ncarone@mcmach.com.
FLYNN ENVIRONMENTAL
Asphalt, Concrete, Crack Filling, Sealcoating and Line Striping
All responses confidential.
For Assessments
Commercial and Residental. Fully Insured - member of Angies List. Quality work at affordable prices
CALL CRAIN’S
(800) 690-9409 www.flynnenvironmental.com
Landerhaven Where Ohio Gathers 440.449.0700
ExecutiveCaterers.com
Looking for brains?
NEW Special Executive Recruitment rates!
(216) 771-5172 216-328-1322 www.buckeyesurface.com
SPORTS & ENTERTAINMENT Indians Private Loge
ATTENTION BUSINESS SERVICE OWNERS!
PENTHOUSE APT. – 2100 SQ FT.
SUBSTANTIAL DISCOUNT
Great View – 3 Bedroom/2 Bath In-suite Washer/Dryer, UnderGround Parking and Much More!
off your ad price.
440-259-5200, ext. 3270
Selling or leasing a property? Get your property featured through Crain’s
CLASSIFIED
CRANE BUILDING
216-2 228-7 7761
Looking for property? Search thousands of local listings
440-349-4664
APARTMENT FOR RENT
17600 Detroit Rd., Lakewood
Powered by LoopNet, No. 1 in Commercial Real Estate online
1st floor 1200 sq. ft. 2nd floor 2500 sq. ft. with elevator. Call Dinallo-Wittrup & Associates
INDUSTRIAL SPACE
For Lease. 40,000 sq. ft. including Offices. 4 Overhead cranes, 7 ½ to 35 ton.
Copy Deadline: Wednesdays @ 2:00 p.m. All Ads Pre-Paid: Check or Credit Card
Crain’s Cleveland Business Online Property Search
30675 Solon Rd.
Gordon Greene, OH RE Broker & Auctioneer Michael Berland - Court Appointed Auctioneer
Perry, Ohio
MAY 17-23, 2010
Submit your business card to promote your service and receive a
To find out more, contact Genny Donley at 216.771.5172
www.RentCastlewood.com
Attention Church Head Hunters or Lay People! A compassionate, conservative, Bible believing, Princeton educated Minister is seeking a pulpit with new congregation open to the word of God. Please contact Signet Creative for contact information on the pastor at 800-636-1595.
DON’T FORGET:
Share our Home Plate suite for the Indians! Perfect for your special event!
Crain’s Cleveland Business on-line @ CrainsCleveland.com
Please call Jen at 614-218-3884
For all the latest business news...online
www.SuitePartners.com
FAX US OR E-MAIL US YOUR AD... FAX: (216) 694-4264 E-MAIL: GDONLEY@CRAIN.COM
WANTED: Your subscription to Crain’s Cleveland Business To sign up call toll-free at 1-888-909-9111 or on-line @ CrainsCleveland.com Click on “Subscribe Now.”
20100517-NEWS--27-NAT-CCI-CL_--
5/14/2010
2:04 PM
Page 1
MAY 17-23, 2010
CRAIN’S CLEVELAND BUSINESS
WWW.CRAINSCLEVELAND.COM
27
THEINSIDER
THEWEEK MAY 10 - 16 The big story: The Greater Cleveland Partnership has been told to start looking for a new home to replace its 3-year-old suite of offices on the first two floors of the Higbee Building in downtown Cleveland — a move that could make way in the former department store for the first, early-opening phase of Dan Gilbert’s Cleveland casino. GCP president Joseph Roman said his landlord, Roman Forest City Enterprises Inc., and Rock Ventures LLC, the Dan Gilbert partnership that will build and own the Cleveland casino, have suggested to him that he “start looking for new office space.” Mr. Roman said he has not yet begun a search for space for the 99 employees of GCP and its sister organization, the Council of Smaller Enterprises.
Time to leave: One of JumpStart Inc.’s portfolio companies has been sold, marking the first exit from an investment by the venture development firm. DIY Real Estate Solutions of Pepper Pike was bought by another property management software company, Yardi Systems Inc. of Santa Barbara, Calif. JumpStart, which assists and invests in startup technology companies, would not disclose how much the company was sold for, but chief marketing officer Cathy Belk said the organization received more than a 20% return on its $350,000 investment in DIY.
Data-driven: BlueBridge Networks LLC of Cleveland bought the assets of the former Nationwide Insurance data center in Mayfield Heights for an undisclosed price. The 5,400square-foot data center will serve as a backup site for BlueBridge’s main data center in downtown Cleveland and its other satellite facility in Columbus. Nationwide is consolidating its data center functions in Columbus, where it is based. BlueBridge in some of the new space is creating 50 work stations that customers would be able to use if they were unable to work from their offices because of an unforeseen event. Under new management: To revive the Wolstein Center, Cleveland State University is turning to a university arena management veteran. The arena, which plays host to CSU men’s and women’s basketball games and concerts, among other events, next year will be managed by Global Spectrum, an arm of Philadelphiabased sports and entertainment conglomerate Comcast-Spectacor. Global Spectrum runs 85 venues nationwide, including 11 university sites. Key promotion: KeyCorp said Bill Koehler has been named president of KeyBank’s Great Lakes Region, which includes Ohio, Michigan and Indiana. Mr. Koehler previously led KeyCorp’s Keyvolution project, a corporatewide initiative focused on improving the company’s efficiency and effectiveness. Mr. Koehler succeeds Chuck Sulerzyski, who left the bank “to pursue other opportunities,” a spokesman said.
REPORTERS’ NOTEBOOK BEHIND THE NEWS WITH CRAIN’S WRITERS
Art, just as you like it ■ The Cleveland Museum of Art is getting more personal. The museum in University Circle has launched a new interactive web site, www.clevelandart.org, that enables visitors to customize future visits. Patrons will be encouraged to create online user profiles that, whenever they log in, automatically will bring up information about the topics they’re most interested in, such as European paintings, classes and lectures. “They’ll truly be able to see the site as they want to see it, customized with the information they’ve told us is most important to them,” said Cindy Fink, the museum’s director of marketing and communications. The web site was designed with local, frequent museum visitors and global art enthusiasts in mind. Locals tend to enjoy art as a whole and visit the museum for various events, while global art lovers tend to visit the web site to look for a specific piece of art. Each page on the site also enables visitors to share information about art or events through social media such as Facebook and Twitter. — Shannon Mortland
The Independence-based Precision Metalforming Association and the soon-tobe Independence-based National Tooling and Machining Association, which is moving from Washington, D.C., this summer, are promoting what they call “reshoring” work to the United States. What’s reshoring? It’s the movement of work from overseas, and especially Asia, back to this country. Conditions are right for it to happen, the groups say. “It’s cost and the realization that a 14,000mile supply chain might not be that sound in the long run, especially if you’re talking about parts and components,” said Precision Metalforming Association president Bill Gaskin. The groups will focus on reshoring when they hold a purchasing fair this fall. Rob Akers, chief operating officer of the National Tooling and Machining Association, said he already has seen interest from foreign and domestic companies that want to attend in the hopes of finding U.S. suppliers. — Dan Shingler
Enough of the write stuff, already
ton’s pens is lovely. And thank you so much for your note. Unfortunately, the Kryptonitecolored writing utensil was far from indestructible; it broke into more than 50 pieces in the bottom of the envelope in which it was sent. That makes it hard to write with. From now on, as my editor Scott Suttell suggested, I’ll no longer accept your pens nor write about them in this space. Instead, you can send me iPads and other expensive electronic devices. Just so we’re clear, that last request is made in jest. Your feedback and continued reading are the only gifts I need. Thanks for them both. — Arielle Kass
An open house under Buckminster Fuller’s dome ■ Anyone who wants to see some noteworthy modern architecture — or learn anything about nearly any material imaginable — is invited to ASM International in Russell Township in Geauga County for the group’s “pre-renovation” open house. It’s the last chance for most of the public to see the headquarters for what was formerly called the American Society for Metals, before the entity branched out to become the world’s largest nonprofit devoted to materials science. Most of the renovation will take place in the ASM offices, but the treat for visitors will be the sight of the 100-foot-high geodesic dome atop the facility. Designed by architect John Terence Kelly and mathematician R. Buckminster Fuller. The dome, built in 1959, needs no renovation. — Dan Shingler
■ Reshoring — a term for what might be the next trend in manufacturing — would be a good one for local companies.
■ An open letter to local banks: I’m calling a truce. Thanks for all the pens, guys, but now that I have a small arsenal in the bottom of my purse, I’m declaring the arms war over. Yes, Sally — Sally Balch, a vice president in Huntington Bank’s Private Financial Group — the new shade of green on Hunting-
MILESTONE
BEST OF THE BLOGS
COMPANY: Middough Inc., Cleveland THE OCCASION: Its 60th anniversary
Excerpts from blog entries on CrainsCleveland.com.
Time to take off the ‘Belt’ and get down to the ‘Core’
By the numbers, at least, our commutes are a breeze
■ Goodbye, “Rust Belt.” The Brookings Institution in a new study, “State of Metropolitan America,” suggests that as metropolitan areas continue to grow, terms such as “Rust Belt” and “Sun Belt” increasingly are irrelevant. A Bloomberg summary of the report noted that Brookings has created seven categories for the 100 largest metropolitan areas that it said reflect the growing differences. Brookings says cities including Cleveland, Detroit and New Orleans should be known as “Industrial Cores,” comprising mostly older industrial centers in the Northeast, Midwest and Southeast. “Their populations are slower-growing, less diverse, less educated and older and as a whole they lost population during the 2000s,” Bloomberg reported. The other categories: Next Frontiers, New Heartlands, Diverse Giants, Border Growth areas, Mid-Sized Magnets and Skilled Anchors.
The reverse of offshoring
Middough Inc., an architectural, engineering and management services company headquartered on East 13th Street in downtown Cleveland, is celebrating its 60th anniversary with a new corporate tagline: Performance You Trust. “When William Vance Middough opened our company in 1950, his vision was based on strong personal values where honesty and trust would be his guide and his word and handshake were as good as gold,” the company says in a news release describing its history. “Today, these founding values remain true and are the cornerstone of Middough’s success,” Middough says. Though started as a family business, Middough now is 100% employee owned. It operates offices in 13 U.S. cities outside of Cleveland and has more than 800 associates nationwide. For information about the company, visit www.Middough.com. Send information about corporate anniversaries to managing editor Scott Suttell at ssuttell@crain.com.
■ Here’s another piece of evidence that Cleveland is a good place to live. Buffalo Business First looked at Census Bureau data on commute times for 52 major U.S. markets. Rochester, N.Y., and Buffalo were No. 1 and 2, respectively, with average commutes to work of 20.37 minutes and 20.78 minutes. Cleveland ranked 13th, at 23.82 minutes. Last on the list, to no one’s surprise, was New York, at 34.55 minutes. (Think about it, LeBron.) That means the average New Yorker spends 10.73 more minutes each day getting to work than the average Clevelander, and 21.46 more minutes per day round-trip. Over the course of a week, that’s more than 107 minutes — nearly two hours. And over a 48-week year of work, that’s an extra 5,150.4 minutes, or 85.84 hours — the equivalent of two work weeks.
weatherhead To learn more about our highlyranked Part-Time MBA and Executive MBA programs, visit weatherhead.case.edu OUR LETTERS CARRY THE STRENGTH OF NUMBERS
20100517-NEWS--28-NAT-CCI-CL_--
5/13/2010
9:53 AM
Page 1
Pay early or defer payment – either way, it’s money in the bank. “The Plum Card seemed like a natural way to save some money. I saved thousands of dollars over the course of a year, and it was a no-brainer.” - Thomas Tranguch, T&F Tire Supply Inc., Member Since 2008
The Plum Card ® from American Express OPEN offers flexible payment terms. If your established business pays your bill early, you get a 1.5% discount that can add up to thousands of dollars that go right back to the bottom line. Or your business can defer payment if cash flow is ever less than steady. This kind of flexibility gives you the option to choose, each month, which way to pay. And puts more cash back in your hands.
Is the Plum Card right for you? Visit plumforbusiness.com to see how other businesses use the Plum Card to their advantage. Or call 1-866-973-PLUM. Then decide for yourself.
Pay your balance in full within 10 days of the statement closing date and get a 1.5% discount on virtually all purchases made that month. The discount will appear as a credit on the following billing statement. Pay 10% of the balance from new activity on your billing statement plus the entire amount of any previously deferred payment or amounts past due by the “Please Pay By Date” on that statement and you can extend payment on the rest until the closing date of your next billing cycle without penalty. Visit plumcard.com for details. ©2010 American Express Bank, FSB. All rights reserved. P04