Crain's Cleveland Busienss by Crain's Cleveland Business

Government: Cleveland is attempting to address looming tech and innovation challenges. PAGE 3

CRAINSCLEVELAND.COM I February 24, 2020

RETAIL

Paper, cloth or plastic? Stores try to navigate the muddied waters of what the new plastic bag ban means to their business

BBY MARY VANAC

PLASTIC SHOPPING BAGS ARE EVERYWHERE: blowing down city streets, emerging from garden soil, clogging sewer grates and washing up on beaches where they can kill wildlife and disintegrate into tiny pieces that end up in our drinking water. Yet the rainbow-hued bags, used by retailers for decades, are a cheap and effective way to take home our groceries and can be recycled or reused. People around the world are trying to figure out how to deal with the bane and boon that is the single-use plastic shopping bag. On Jan. 1, Cuyahoga County imposed a ban on the ubiquitous bags in the form of a fine, suspended until July 1, on retailers who use them. Soon after the county’s announcement, cities such as Cleveland, Strongsville and North Olmsted opted out, saying the ban was too costly for retailers, especially grocery stores that operate on thin profit margins. Earlier this year, Cleveland said it would develop an alternative plan to charge customers a small fee for each bag while exempting low-income people. Even the Ohio Senate has joined the debate, considering one of two bills that would bar counties and cities from banning plastic bags. Is your head spinning yet? See BAGS on Page 18

CRAIN’S CLEVELAND BUSINESS ILLUSTRATION

FOCUS

WORKFORCE TRENDS

WORK AT IT Today’s managers must adjust to generational preferences, attitudes about careers. PAGE 11

NEWSPAPER

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Find the remote

Northeast Ohio’s low cost of living could be a magnet for remote workers BBY JAY MILLER

Economic development’s role in growing the population of Northeast Ohio by growing employment has traditionally involved wooing businesses to move to the region or to expand existing operations. Attract more business operations and jobs in warehouses, call centers and office buildings will follow, is the theory. That’s still a strong working strategy. But a few regions are trying to woo a new and growing class of

workers who, because of the wired, interconnected world, can now work remotely full time, even on the other side of the country from their employer. But while other states and communities are beginning to offer financial incentives to attract fulltime remote workers, there is so far no effort to actively attract remote workers to Northeast Ohio, despite the region’s attraction as a low-cost place to live. “It’s a complete blind spot for our region at the moment,” said

Ed Buchholz, the founder of StartInCLE, an organization of startup entrepreneurs that works to connect businesses with workers, in an email. “It’s something I’ve brought up to (economic development organizations), but I don’t think they really know how to address it. StartInCLE has tried to do some matchmaking just based on my network, but we don’t have the budget to do it at a broad scale.” See REMOTE on Page 15

2/21/2020 11:55:49 AM

HEALTH CARE

Trazer finding room to grow in sports rehab, senior care Westlake family company combines gaming-based training with motion-capture lab BY LYDIA COUTRÉ

In the mid-1990s, the late Barry French Sr. burst into his family home, eager to share the new technology he’d been working on in the garage: a groundbreaking new way to track and capture human movement. The first iterations of technology were impractically large and prohibitively expensive. Though the technology gained national buzz at the time, it wouldn’t be until 2017 that the Westlake family company Trazer created its first commercially viable product that can assess, train and rehabilitate users. Since then, the company has been working steadily to expand its customers for Trazer (a combination of "tracking" and "laser"). Its initial client base was found among NCAA Division I schools. It has expanded to include various clinics and physical therapy centers and other care providers. The technology combines gaming-based brain training tools with a motion-capture lab that digitally records and measures the body’s movement. It’s a tool to accurately measure and objectively quantify movement, allowing users to track improvement or degradation of quality and performance, which can be hugely important in performance enhancement and returning athletes to play after a concussion or other injury. ”The brain drives everything we do,” said Barry French Jr., who remembers sitting on the couch with his brother when his father excitedly announced the technology. Today’s, he’s CEO of Trazer. “You cannot assess, treat or enhance performance, for ex-

Trazer’s technology, which has been largely used in sports medicine and athletic training, is a tool used to objectively quantify movement, allowing users to monitor improvement or degradation of quality and performance. | CONTRIBUTED PHOTO

ample, without integrating the brain and body together,” French said. After initially working primarily in the athletic and sports medicine space (both in performance enhancement and rehabilitation), Trazer last year entered the senior care market, aiming to help assess and mitigate fall risk. Trazer adds math problems or color challenges that prompt the individual to physically move to solve the answers, allowing providers to look at brain health, musculoskeletal ability and performance of the body at the same time “to not only look at what area is affected but how can we improve the holistic human,” French said. The company raised about $3 million in initial seed money through angels and is out for a post-seed round

seeking another $1.5 million, French said. That, he thinks, will help Trazer execute on some key initiatives, including its “huge growth potential,” he said. Today, Trazer has 105 of its units in the field with 87 clients. Recognizing that no one on the Trazer team is a clinician, the approach has been to get the technology in the hands of clinicians who can find the best use for it. Trazer then learns from those clients, standardizing and objectifying the approaches for everyone. “By putting it in the hands of the clinicians, taking the technology, getting the technology in a place where it was really usable, putting it in the hands of some of the best in the world and then learning from them is — I think, for looking at how to make companies

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successful in the long term — is really valuable,” said Kyle Frantz, chief strategy officer for Trazer. This allows the users to drive how the technology works, which is ultimately what brought Trazer to the senior care space. Its largest physical therapy client came to the team and said it wanted to take the service into assisted living, independent living and memory care for seniors. In a 2,000-person census, the client saw a 30% reduction in falls in just one year. “It’s not enough to just assess risk of fall, which we do and we do very, very well, but you have to mitigate, too,” French said. “And again, Trazer’s a unique tool that can do both.” Dr. Joseph Congeni, medical director of sports medicine at Akron Chil-

dren’s Hospital, was introduced to earlier versions of the Trazer technology a couple of decades ago and has since seen it progress. The technology is currently at Akron Children’s for a research project, but it isn’t in use at the moment as the project is in limbo after a fellow moved away. Congeni said he’d like to see the technology available to patients. He sees it as a useful tool in concussion treatment and making return-to-play decisions for athletes following an injury. The technology allows clinicians to see any asymmetry or weakness after a musculoskeletal injury to determine whether the patient is going to be able to respond to the demands of the sport that they want to return to, without having to actually expose them back out on the field. “Particularly in contact or collision sports ... we use clinical testing, office testing, history, how do you feel — you know, those kind of things that have a lot of subjectivity to them,” Congeni said. “And what I liked about the Trazer technology is it had a lot of objectivity to it.” The team at Trazer sees its technology as having a meaningful impact on countless people’s lives in many areas: clinical, research, athletic, senior care, health care spaces. “How do we maximize that impact?” Frantz said. “How do we take what we’ve learned from these best in the world and make that approachable and accessible and usable across different populations and to different people? That’s the fun part.” Lydia Coutré: lcoutre@crain.com, (216) 771-5228, @LydiaCoutre

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GOVERNMENT

The city of Cleveland prepares for change Cleveland leaders envision what the 21st century will bring BBY KIM PALMER

As technology continues to evolve, cities like Cleveland have found that traditional policies and regulations are woefully inadequate for dealing with the rapid pace of innovation. “The administration’s goal is to focus on tangible policy and system change so that Cleveland is positioned to be competitive in the future. That is something that Mayor Jackson is really focused on,” said Fred Collier, director of the city’s planning department. City departments have struggled with disruptive technology, such as when motorized scooters began to appear on public streets practically overnight in the summer of 2018, with no regulations in place to deal with an emergent mode of transportation. The planning department also had to react quickly to develop a comprehensive permitting policy around the installation of the thousands of small cells required to enable 5G as multiple companies entered that market. “Digital signs and media are challenges we are facing right now,” Collier said. “We have had digital signage applications come through the building department with products that we never saw before. We have been told that now some signage is going to be integrated into the infrastructure of the buildings. How do you regulate that?” To create a process to respond to these issues and others, city administrators this fall will host a symposium titled “Building the 21st Century City: The Future is Now!” in partnership with the Urban Land Institute (ULI). The event will take place Oct. 2. The event, which is still in the planning stages, is intended to bring national leaders together with local stakeholders to identify best practices for contending with three specific issues the city is facing: emerging technology, inclusive land use as economic development and innovations in mobility. ULI chair Steve Ross said the Cleveland chapter of the national nonprofit land-use organization helped design the event, which will be the first of a three-part process. The second phase will bring local stakeholders together to apply ideas from the symposium. Execution of those policy reforms is the third phase. “We at ULI are focused on education and leadership, and our members are a diverse group of private sector and public sector. This is right in line with what we do,” said Ross, a senior associate at commercial real estate firm CBRE. The execution phase, Ross said, will help the groups and the individuals who create the policy enable the city to deal with an impending cultural shift. Mobility changes, e-scooters, protected bike lanes and dedicated bus lanes are having a ripple effect by changing how traditional modes of transportation work, Collier said, adding that road right-of-ways are changing as cities adapt to different modes of travel that often slow traffic flow and demand that cars share the streets. Ross and Collier predict more streets could be walled off to automobile traffic, similar to how Ohio City shut down Market Street to traffic last summer. Electric cars and autonomous vehicles will mean re-envisioning city parking infrastructure, possibly eliminating the need for private car ownership within a matter of

decades. Any significant drop in private vehicle ownership would mean that land now used for auto dealerships and surface parking lots could be shifted to other purposes. Ian Meadows, city planner with City Architecture, said he thinks Cleveland is at a critical point when it comes to how mobility and technology change the trajectory of land development. These advances, he said, are capable of not only improving the quality of urban life but also of fixing at least some of the causes of income inequity. “Traditional zoning, which dates

back to a time when everyone loved cars and wanted to get from A to B as fast as possible, left us with a city that prioritized the expansion of street networks,” Meadows noted. These zoning laws then created segregated land uses, with residential areas separate from industrial areas, which ostensibly separated people without transportation from jobs. Meadows said moving to “formbased zoning,” one of the focuses of the October symposium, ensures development that counters outdated zoning by encouraging walkable streets that are

accessible to work, retail, connected transit networks and safe public spaces. Under the direction of the city’s planning department, Cleveland has implemented three pilot programs in the Hough, Detroit Shoreway and Opportunity Corridor neighborhoods where form-based planning is underway. “Every little incremental change we get from these policies and discussions, every new crosswalk that is added and protective bike lane and every new safe, accessible community park sets the ball in motion,” Meadows said.

Coin-operated meters and other municipal parking options will require re-evaluation as technology moves forward. | DAVID KORDALSKI/CRAIN’S

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Local firm lands U.S. soccer standout Gallagher Sports has new marketing deal with winger Tyler Boyd BY KEVIN KLEPS

By the time Tim Martin decided to go all in on his sports marketing agency, he had spent more than a decade in the industry. He knew the space was crowded and it was only going to get worse. That left Martin with a simple, albeit nerve-wracking choice: If he was going to leave his job as vice president of sponsorship investments for PNC Bank, he had to find his niche in a “very global field.” For Martin, a 41-year-old Mentor native who started Gallagher Sports as a side business in 2007, that field was soccer — a sport about which he is really passionate. Martin made the full-time leap to Gallagher Sports (which gets its moniker from the maiden name of his late mother, Kathie) in 2012. There were some rough early years, he admitted, but the business has grown in each of the past few years and Martin said he thinks 2020 could be the best yet. The year got off to a productive start when Gallagher Sports, which consists of Martin and a group of interns and outside agencies, struck a deal with Tyler Boyd, a winger for the U.S. men’s national soccer team. Boyd signed an exclusive marketing representation agreement with Gallagher Sports. The agency, according to the promising forward, can help him “further engage with American brands who possess similar values to my own.” Boyd, who was born in New Zealand to an American mother and a Kiwi father, was allowed by FIFA to make a one-time switch to the U.S. men’s team. He made his debut for the Amer-

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icans in 2019, and he scored a pair of goals in a group-stage opener against Guyana in the Gold Cup. In July, Turkish power Besiktas paid a Portuguese club $2.2 million for Boyd’s services and signed the winger to a four-year deal. At 25, Boyd is entering his prime soccer years, and Martin is hopeful he’ll be part of U.S. clubs that could compete in the 2022 and ’26 World Cups. The Americans, whose run of seven consecutive World Cup appearances ended with a flameout prior to the 2018 showcase, will begin play in the qualifying round for the 2022 World Cup in September. “Most people don’t realize what a big year this is for U.S. Soccer,” Martin said. The same description could hold true for Boyd and, in turn, Martin. Martin said some companies have already shown an interest in working with Boyd, but finding the right fit will be key. Martin, who works out of his home in Cleveland Heights, said about 80% of his business stems from his extensive ties in soccer. He serves as a sponsorship broker between European clubs and U.S. companies, and helps brands build marketing campaigns.

Ryan Heuser, the director of field marketing for Mark Anthony Brands, which produces the popular Mike’s Hard Lemonade and White Claw Hard Seltzer products, enlisted Martin’s help for promotions that were centered around the Americans’ run to the championship of the 2019 Women’s World Cup. Heuser said Martin’s connections with the American Outlaws, a rabid group of supporters for the men’s and women’s teams, were crucial in rounding up guests for White Claw-themed viewing parties in three target markets (Nashville, Orlando and Tampa) during the Women’s World Cup. “Everyone was happy. Our regional team was happy, and the accounts where we hosted (parties) were thrilled,” Heuser said. “It was a great way to increase relationships.” The field marketing director said he’s already trading ideas with Martin on possible promotions for this summer. Martin has done work on the promotions side with the likes of ParkerStore (the retail arm of Parker Hannifin) and 2nd Skull. But the majority of his business stems from connecting U.S. firms with European soccer teams. When he made Gallagher Sports his full-time job, Martin said few international clubs had sales teams in the U.S. That has changed, but the clubs tend to be understaffed and “open to working with a third party, provided they’re experts in the space,” Martin said. The entrepreneur is confident he can stand out in that congested arena. Kevin Kleps: kkleps@crain.com, (216) 771-5256, @KevinKleps

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Great Lakes cruises have seen rapid growth as a result of a concerted marketing effort by the Port of Cleveland. In 2017, nine cruise ships docked in the port. The next year, that number grew to 22, and last year it was 28. As of now, 41 cruise ships are scheduled to dock in Cleveland in 2020. “The last five years have seen an explosion of cruise vessel activity in and around Lake Erie,” said David Gutheil, chief commercial officer for the port. “One of the reasons for that is the cruise industry around the world is saturated. The Great Lakes is really the last geographic area for cruise vessel calls.” In February, the port finished updating, at a cost of more than $650,000, a permanent U.S. Customs and Border Protection station to help process an estimated 2,000 to 3,000 international travelers who come to the city on one of the international Great Lake cruises. (About 6,500 passengers came through the port in 2019, but only about half needed to be processed through customs. The estimate for 2020 is that 7,500 passengers will dock here and, again, about half will need processing.)

Celebrating

At least two more companies are prepping to add Great Lakes lines, including Viking Cruises, which has 20 river and five ocean lines that visit 403 ports in 95 countries. Matt Grimes, Viking Cruises executor director, said more ships are being built for the high-end lake and river cruises, which cost upward of $5,000 ($1,250 a night) for an eightday, seven-night trip and prohibit anyone under 18 years old. “We operate in a different market than previous Great Lakes cruise line operators, but we do plan to pour $100 million in marketing over the next five years, and that should benefit all the operators in the Great Lakes,” Grimes said. Lake cruise ships are smaller than their oceangoing counterparts, typically holding 200-450 passengers, each of whom are estimated to spend about $150 during a visit to Cleveland. Although Viking has not officially scheduled a stop at Cleveland when it launches in 2022, Gutheil said it is just a matter of time before the port is added to the company’s schedule of Great Lakes destinations. One of the reasons Gutheil is so confident is the renewed attention

ports like Cleveland are receiving. That includes newly allocated public funding; monies that he and his staff have spent the last few years lobbying for in D.C. and Columbus. “About three years ago, four years ago now, we asked other port authorities what federal funds were available and there were none,” said Jade Davis, vice president of external affairs for the Port of Cleveland. That has changed. The port was recently awarded $11 million in federal funds, including $9 million (with the Northeast Ohio Areawide Coordinating

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“THE GREAT LAKES IS REALLY THE LAST GEOGRAPHIC AREA FOR CRUISE VESSEL CALLS.” — David Gutheil, chief commercial officer for the Port of Cleveland

Agency) for the Irishtown Bend project in the Flats. Along with that, the state of Ohio agreed to provide one-to-one matching funds of up to $23 million over two years from the Ohio Maritime Assistance program, in addition to $2.6 million for capital projects. Ohio Rep. Dave Joyce advocated for $200 million in total Port Infra-

structure Development Grant funding from the U.S. Department of Transportation because he sees Cleveland’s port as a huge economic driver for the region. “As one of the largest ports on the Great Lakes, it supports more than 20,000 jobs and generates $3.5 billion in economic activity every year,” he said. The Great Lakes ports will receive about 12% of that $200 million, according to Davis. The funding is critical as the port shows significant signs of wear following decades of neglect while coastal ports received the bulk of governmental infrastructure investment. Issues include Dock 26 West, which was closed down in late 2018 and requires an estimated $18 million to repair. Rather than ask taxpayers to fund

the repairs through bonds or tax increases, Davis lobbied for nonlocal funding. “We set out to create programs and funding opportunities,” he said. “Nationally, we teamed up with other ports to help advance legislation to get new funding programs created, which ended up becoming the Port Infrastructure Grant.” The funding is part of an overall awareness strategy for the port to convince carriers to rethink the way cargo is brought into the “heartland” and aggressively market the benefits of leaving the congested coastal ports in favor of the Great Lakes. “The more goods that flow into the coastal ports, the more congested they become. They should be looking at the Great Lakes as a release valve,” Gutheil said. Overseas container shipping to the larger coastal ports in New York and California has stunted the amount of commercial goods that once traveled through the St. Lawrence Seaway to the Great Lakes and Cleveland, dropping the cargo total traveling through the waterway from a peak of 70 million tons to just 40 million tons in 2019. Now, environmental concerns and infrastructure stresses of over-theroad cargo transportation mean the Great Lakes look like a better option for some. “Door to door, we can shave seven to 10 days off the transit time between the Midwest and Northern or Central Europe,” Gutheil said. “It takes nine days to go from a port in Germany to the port of New York, and that container is going to sit because of all the port congestion. In Cleveland, when it is taken off the vessel, we can get that out for delivery the next day. That is our advantage.” Kim Palmer: kpalmer@crain.com, (216) 771-5384, @kimfouroffive

The Hudson City School District has issued a Request For Proposal (RFP) for the purpose of selecting a real estate development firm for the reuse or redevelopment of the property known as the 1927 Building of the Hudson Middle School. For more information, contact Director of Operations Steve Marlow at marlows@hudson.edu or call 330-653-1207. The Request for Proposal and supporting documents can be viewed at https://tinyurl.com/qrmvyel.

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EDITORIAL

The place to be O

ne of the things Northeast Ohioans rightfully can brag about is the reasonable cost of living here. (You weren’t expecting us to say the sports teams, were you?) Case in point is a new study from ATTOM Data Solutions, a property database firm, which found that among U.S. counties with a population of 1 million or more, Cuyahoga County was one of the most affordable for renting, and it was in a group of just 16% of large counties where buying a home is even more affordable than renting. That offers a little context for what we hope is a big effort to attract more remote workers to this region — an issue explored in a Page One story this week by reporter Jay Miller. In an increasingly tech-driven economy, the workforce is less place-bound than ever, and budget-friendly, amenity-rich Northeast Ohio should be an appealing location for people who work remotely at least some of the time. But as Ed Buchholz, the founder of StartInCLE, an organization of WORTH EXPLORING, entrepreneurs that FOR LOCAL FOUNDATIONS, startup works to connect businesses with workers, told us, “It’s a IS A MODEL FOLLOWED blind spot for our IN TULSA, OKLA., WHERE complete region at the moment.” Groups like his have the deA PROGRAM CALLED sire, but not the budget, to TULSA REMOTE OFFERS do such matchmaking at a meaningful scale. REMOTE WORKERS A We’re pleased that the sitFINANCIAL INCENTIVE uation might be changing. Cleveland, the TO LOCATE IN THE CITY. Destination group that quite effectively brings conventions and tourists to town, is starting work on a plan to market this region as a place to find a job, possibly including remote work. There’s a good case to be made, and we hope Destination Cleveland carves out space to make a pitch to people who aren’t working in traditional settings. Also worth exploring, for local foundations, is a model followed in Tulsa, Okla., where a program called Tulsa Remote offers remote workers a financial incentive to locate in the city. That program was launched last year and was renewed for

2020, when it hopes to attract 250 resident remote workers. The much larger Northeast Ohio could draw quite a bit more than that, if the incentive is right and the marketing is on point. Remote workers are a relatively small, but growing, part of the workforce retention/expansion issue that employers in Northeast Ohio and elsewhere have struggled with for some time. It’s only sensible to make sure the region is putting its best foot forward to raise the chances those workers are here.

Recovery B

illionaires are getting a lot of attention these days, mostly in the world of presidential politics. Closer to home, though, Dan Gilbert, the owner of the Cavaliers and founder of Quicken Loans, shared with sister publication Crain’s Detroit Business some attention-getting details of his recovery from a stroke last Memorial Day weekend that caused temporary paralysis of his left arm and leg. (By all means, read the interview if you haven’t already done so.) Gilbert says he’s “very lucky” to have survived. And in the wake of the stroke, he says, “Everything is hard. ... Like you wake up, getting out of bed is hard, going to the bathroom is hard, sitting down eating at a table is hard. You name it. You don’t get a break. You’re like trapped in your own body.” Crain’s Detroit noted that Gilbert “spends three to four hours daily” working with occupational and physical therapists — something he’s able to afford but that is out of reach for many. That led Gilbert to offer this: “I start thinking about, imagine people who just don’t have any of these resources. What do they do? I mean, insurance does not usually cover most of the … rehab from a stroke. Maybe some of it, but not most of it.” We’re relieved that Gilbert is doing better after such a serious health episode, and that he’s calling attention to the American Stroke Association’s acronym for spotting signs of a stroke: FAST, for face drooping, arm weakness/numbness, slurred speech, and time. And perhaps, we hope, his words about insurance echo loudly throughout all corners of the political landscape to make sure the ability to recover isn’t determined by an individual’s financial stature.

Publisher and Editor: Elizabeth McIntyre (emcintyre@crain.com) Managing Editor: Scott Suttell (ssuttell@crain.com) Contact Crain’s: 216-522-1383 Read Crain’s online: crainscleveland.com

One of the tried-and-true features of the American economy is that consumers benefit most when the market is allowed to work without undue interference or political favoritism. That’s particularly true in energy markets, where fuel sources competing on a level playing field have traditionally helped to ensure an affordable and reliable supply of electricity. And that’s why there is Kupfer is a such concern about the proliferation of former acting subsidies — especially at the state level deputy secretary — and how they will impact the long- of energy in the term functioning of our energy markets. George W. Bush Ohio taxpayers will soon start subsidiz- administration ing First Energy Solutions’ nuclear energy and an adjunct facilities to the tune of approximately $1.1 professor of billion through 2027, as well as nearly half policy at a billion dollars in subsidies to prop up a Carnegie Mellon pair of 50-year-old coal plants. Add to that University’s another $20 million per year in subsidies Heinz College. for six utility-scale solar projects. Recognizing a potential problem, federal regulators tried to do something about it. Late last year, the Federal Energy Regulatory Commission (FERC), whose mission is to ensure that consumers have reliable energy at a reasonable cost, directed PJM Interconnection, the body that oversees a fifth of the U.S. power supply, including Ohio, to modify its pricing rules. Specifically, FERC expanded a rule known as the Minimum Offer Price Rule to account for the distorting effect of state-provided subsidies and ensure competitiveness in the PJM capacity market, where power generators bid for future energy demand. This all sounds like regulatory gobbledygook, but it actually matters for the people of Ohio. For starters, Ohio is in the top 10 among states for total energy consumption and has much on the line when it comes to energy prices and reliability. According to the Energy Information Administration, Ohio’s industrial sector accounts for a third of the state’s energy use and transportation accounts for a fourth. Those sectors, which employ huge numbers of Ohioans, depend on affordable and secure power to remain successful and pursue opportunities for growth. With subsidies flooding Ohio and other PJM states, the best way to ensure the lights stay on is to guarantee that all power providers have a fair chance to compete. The capacity market is designed to ensure that necessary capital flows into future energy facilities, so it’s especially important that market signals are not distorted. For example, while offshore wind may be cost-competitive and effective at providing power for Ohioans in the day-to-day energy market, its intermittent nature reduces its value as a future demand resource. Opponents call the measure an overreach of federal authority that interferes with the states’ role in deciding what type of electricity generation is best. But that argument doesn’t hold water, especially in light of FERC’s statutory authority to oversee wholesale electricity markets. First, states can still make those choices and enact whatever subsidies or mandates they see fit. Second, critics can’t have it both ways, only supporting FERC intervention when its supports a particular agenda. While there are still details that need to be ironed out on FERC’s proposal, it’s a step in the right direction for both consumers and the environment. After all, the competitive marketplace helped reduce carbon dioxide emissions by 30% across PJM from 2005 to 2016. In Ohio, that was a reduction of 50 million metric tons. Fortunately, it’s not too late for Ohio to stay on the right track. With a common-sense pricing rule that realigns a marketplace impacted by subsidies, regulators will cultivate a future that delivers affordable prices and the power reliability that Ohio citizens deserve.

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

Sound off: Send a Personal View for the opinion page to emcintyre@crain.com. Please include a telephone number for verification purposes.

8 | CRAIN’S CLEVELAND BUSINESS | February 24, 2020

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OPINION

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Ask any manufacturing executive about their most pressing business challenge, and you’re likely to hear the same thing: finding skilled workers. Sixty-three percent of manufacturers in Northeast Ohio named that as their top concern in our 2020 Ohio Manufacturing Survey. Unfortunately, it’s primed to get worse. Seventy percent of these employers are looking to add workers this year, meaning the 8,000 jobs currently going unfilled could more than triple over the next several years. When you consider that manufacturing drives more than half of our region’s overall employment, it’s clear this isn’t just a business challenge, it’s a community challenge. At MAGNET: The Manufacturing Advocacy and Growth Network, we see the critical need for manufacturing workers as a huge opportunity. Nowhere is that more apparent than in bridging the inequity we see in Cleveland, by driving more wealth and well-paying jobs toward disadvantaged populations. The manufacturing workforce of tomorrow is not the same as the workforce of yesterday. We have to diversify our workforce — including more women, people of color, the formerly incarcerated, people with disabilities and others — to fill these high-skill, high-wage positions. MAGNET is leading two initiatives that will offer people of all backgrounds the chance to launch careers in manufacturing through opportunities with higher education. These initiatives provide local manufacturing businesses the chance to develop the skilled workers they so desperately need. First, with the support of the Cleveland Foundation, the state of Ohio and many other local philanthropic foundations and corporations, MAGNET has launched the Early College, Early Career program. ECEC adapts the best aspects of European-style manufacturing apprenticeships to the Ohio educational system, offering students paid internships, college credit, industry-recognized certifications and the potential for a high-paying manufacturing

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VIRTUAL DEMAND The burgeoning esports industry is appealing to students from multiple disciplines. PAGE 12

HIGHER EDUCATION: WORKFORCE DEVELOPMENT

CRAIN’S/ISTOCK ILLUSTRATION

JUGGLING GENERATIONS

Managing today’s workforce means recognizing generational differences BBY PARIS WOLFE

With the growth of today’s multigenerational workforce, business leaders need to broaden their perspective and adjust their expectations. Instead of managing a homogeneous culture, managers are now dealing with millennials (35%), Generation Xers (33%) and baby boomers (25%), according to the Pew Research Center. The remaining 7% are a mix of entry-level Generation Zers and unretired members of the Silent Generation. Pew breaks down the generations by the following birth-year ranges: ``Generation Z (1997–2012) ``Millennials/Generation Y (1981–96) ``Generation Xers (1965–80) ``Baby boomers (1946–64) ``Traditionalist/Silent Generation (1928-45)

“EXPECTATIONS, VIEWPOINTS, LEARNING/ KNOWLEDGE INTAKE, CULTURES, TECHNOLOGY ARE JUST SOME OF THE ASPECTS THAT OFTEN VARY AMONG GENERATIONS.” —— Connie King, director of professional development at Baldwin Wallace University

“Physically speaking, this shift towards more generations in the workplace is due to a variety of factors — mainly longer lifespan and a gradual increase in the retirement age,” said Connie King, director of professional development at Baldwin Wallace University in Berea. “With each generation, there are typically nuances, inherent to those in the generation, spurred by the environment in which they grew up.” To be competitive, today’s business managers must be aware of those nuances in how each generation approaches work. While no generation is monolithic in its views, of course, studies do back up, for example, that the majority of baby boomers hold different values than most millennials. “With these nuances come new demands and expectations,” King noted. “Expectations, viewpoints,

learning/knowledge intake, cultures, technology are just some the aspects that often vary among generations.” Generational integration and “clashes,” she added, are no longer restricted to the homefront, where teens forming their own independent personalities often rebel against their parents. Managers should be aware that value differences may spark similar clashes in the workplace. One of the commonly discussed differences among generations touches on attitudes toward work. For instance, baby boomers are more likely to accept overtime hours as part of workplace culture, while millennials may reject that and work only the hours for which they’re paid. See GENERATIONS on Page 15

February 24, 2020 | CRAIN’S CLEVELAND BUSINESS | 11

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FOCUS | HIGHER EDUCATION: WORKFORCE DEVELOPMENT

Not just fun and games

Surging esports raises employment tailwind for students in many other majors, not just elite gamers BY JUDY STRINGER

Joel Garvin figures by the time he graduates from the University of Akron next spring, he will be a full two years ahead of his competition in landing a job in the fast-growing esports sector. Garvin, a junior sales/marketing double major, was hired as an intern for the Zips Esports Network in early 2019. He’s now a paid part-time event manager there, overseeing about a half-dozen volunteers who primarily help organize and coordinate activities associated with the university’s recreational esports league. “Occasionally, we run large tournaments where we bring in other schools’ varsity teams, so those are times when I am working heavily with the very competitive varsity players from around the region,” said Garvin, who monitors esports job listings in anticipation of his 2021 graduation but also has a strong interest in business-to-business career prospects. “If there is a way to make a good career out of esports, if I see the right doors open up, that is definitely something I would strongly consider,” he added. Doors opening in esports is not really a matter of “if” or even “when” anymore. Esports jobs website Hitmarker said it listed a staggering 11,027 openings in 2019, nearly twice 2018’s 5,896 postings. More than half of those jobs were in the U.S. Mark Lyberger, associate professor of sports administration at Kent State University, said event planners/coordinators, business development executives, agents, coaches, team man-

++ + +

in November 2019 in the city’s convention center; the $50 million Fusion esports arena being constructed in Philadelphia for 2021; and the game-themed Atari Hotel due to open in Phoenix in 2022. Add to that the ongoing development of new esports leagues and teams themselves — particularly at the collegiate level — and, Lyberger said, “you have more people participating, more forums being developed and more platforms available today than there ever has been before.”

‘Esports 101’

Seungbum Lee, associate professor of sport studies at the University of Akron, began teaching his “Introduction to Esports” course this semester. The class covers “marketing and management issues in the context of esports,” he said. | CONTRIBUTED

agers, digital marketers, facilities operators and many conventional job titles that already existed in fields like sports management and hospitality have surfaced more recently in relation to the esports sector. The industry is also drawing talent from other disciplines, such as communications, engineering, computer science and medicine. It needs engineers who can design and build esports arenas, for example, and videographers who can produce and livestream tournaments. It needs

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skilled broadcasters and analysts, as well as a persistent flow of video game developers, engineers and artists. “Another big thing is gaming-related injuries, and wellness and rehabilitation practices specific to esports,” according to Seungbum Lee, associate professor of sport studies at the University of Akron. That creates a demand for physicians, exercise scientists and sport psychologists with esports expertise. “Also nutritionists who can help formulate the optimal diet for varsity esports players: one that maximizes concentration and boosts dexterity,” he said. Lyberger credits an escalation in esports enthusiasts and “occasional spectators” for the increase in esports job opportunities. “A lot of the sponsorship growth has been there for years — and continues to grow — but when you drill down into revenue streams, engagement is probably one of the most advantageous items

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in terms of growth and development of the industry overall in the last five to seven years,” he said. In recent years, the global esports audience has surged from 335 Lyberger million people in 2017 to 454 million in 2019, according to Newzoo, a market researcher focused on gaming. Newzoo expects esports to pull in 654 million viewers by 2022 as revenues approach $1.8 billion worldwide. Lyberger pointed specifically to new or planned esports complexes as tangible evidence of live audience growth beyond home-based viewers who watch their favorite teams on streaming platforms like Twitch and YouTube. Notable developments include the $10 million Esports Stadium Arlington in Texas, which opened

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Many colleges and universities, not surprisingly, are scrambling to develop programs for students interested in this growing field. Lee’s “Introduction to Esports” course debuted this semester. Twenty-one UA students are enrolled in the class, which primarily covers “marketing and management issues in the context of esports,” he explained, but also touches on topics such as coaching techniques and athletes’ health and wellness. Lee said he also is collaborating with other UA departments on the creation of a 15- or 18-credit esports certificate that will be “interdisciplinary in nature.” At KSU, Lyberger hopes to roll out the university’s first esports-specific curriculum this fall. An esports course has already been approved and will certainly be part of the fall offerings, Lyberger said, but he is also spearheading the creation of an esports minor that might be ready as early as next year. That would integrate courses across multiple disciplines, and students could customize it to their specific career goals or needs. “So if you are a student already in computer science, you could look at esports from the event management space,” he said. “Or you could be in sports administration or business and get the computer programming piece or the broadcasting piece or learn about event management in that given regard.” Shawn Smith, CEO of Indianapolis-based Harena Data, which tracks esports scholarships, said that while esports degrees “are on the minds” of deans across the county, only a handful of postsecondary schools have officially launched majors and minors specific to the industry. Ohio State University recently announced it will begin offering an esports degree program this fall. “Most universities are still getting their feet underneath them when it comes to some sort of formalized esports curriculum. In three to five years, however, we expect it to be much more commonplace,” said Smith, who added that some see degree programs in esports as a way to pull in college-aged gamers who dream of careers in the gaming industry. Without question, he said, some esports professionals will come from the ranks of elite gamers — just like other sports where former players turn to coaching, team management or broadcasting. However, the more likely scenario is that person “just loves video games,” he said. Contact Judy Stringer: clbfreelancer@crain.com

12 | CRAIN’S CLEVELAND BUSINESS | FEBRUARY 24, 2020

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FOCUS | HIGHER EDUCATION: WORKFORCE DEVELOPMENT

Workforce Connect forging ahead in health care Intermediary Tri-C plans to hire health care leader by end of March By the end of March, Cuyahoga Community College (Tri-C) expects to choose an executive director to lead a bold new health care program in Cuyahoga County. A regional search began following the announcement, in September 2019, that Tri-C would take the lead on health care workforce development as proposed by Workforce Connect. Workforce Connect is a publicprivate partnership involving the City of Cleveland, the Cleveland Foundation, Cuyahoga County, Deaconess Foundation, Fund for Our Economic Future, Greater Cleveland Partnership, The George Gund Foundation, Cleveland/Cuyahoga County Workforce Development Board, Team NEO and United Way of Greater Cleveland. Those organizations have come together to address a lack of skilled workers in the county. Health care is one of three areas where WorkForce Connect is focusing attention; the others are manufacturing and information technology. Based on successful sector intermediary models established in other major U.S. metros, Workforce Connect coordinates a designated intermediary that pulls together businesses within an industry to address talent gaps. The intermediary collaborates with those businesses, higher ed institutions, social service providers and others to develop potential short- and long-term solutions. The Workforce Connect Healthcare Sector Partnership, with Tri-C as the intermediary, is the second sector partnership here. The first — manufacturing — was announced in December 2018, with MAGNET and the Greater Cleveland Partnership as co-intermediaries. The Workforce Funders Group expects to announce the information technology intermediary later this year. “We’re working closely with the Funders Group of WorkForce Connect to interview candidates to become the health care intermediary

ISTOCK

BY PARIS WOLFE

“WE NEED SOMEONE WHO UNDERSTANDS THE ECOSYSTEM OF HEALTH CARE AND THE TRAINING THAT ADDS VALUE TO IT.” — William Gary, executive vice president of workforce, community and economic development at Tri-C

executive director,” said William Gary, executive vice president of workforce, community and economic development at Tri-C. “We’ve been looking for someone who knows how to navigate project management, knows how to build relationships, can interface with the leadership of the hospital systems. We need someone who understands the ecosystem of health care and the training that adds value to it.” That new executive director will work with employers, develop resources, coordinate communication and link partnership activities to initiatives and resources of the broader workforce ecosystem. The targeted outcome is more skilled health care workers for local hospital systems. The hospitals collaborating in these efforts include Cleveland Clinic, University Hospitals, The MetroHealth System, Sisters of Charity Health System and the Veterans Health Administration.

“The new position will help identify populations in our community that are underserved and lack training opportunities,” Gary said, adding that this audience will be linked with training opportunities to prepare them for skilled jobs in the health care field — jobs such as nurses, radiation therapists and patient care navigators, among others. Currently, Tri-C offers training in more than 30 professionally accredited health care fields of study. In fact, the college ranks 10th in the nation in the conferring of associate degrees in health professions and related sciences. Most health career programs take two years and lead to an Associate in Applied Science degree. Short-term certificates are available in many other health career programs. “Training skilled workers is what we’ve been doing for years,” said Gary. “Now, we’ll be coordinating the collaborative relationships of different hospitals. We can collect, analyze and share data on how to address workforce needs by devel-

oping programs curriculum and training. By identifying common priority training needs, we can achieve economies of scale.” “The most significant hospital systems are at the table, committed to work together,” reported Deborah Vesy, chair of the Workforce Funders Group for WorkForce Connect. “Despite working in a highly competitive environment, the employers see the value of a systems-level approach which has the capacity to create reliable talent pipelines that address their workforce needs and reduce barriers to employment and career advancement for workers and job seekers.” In September 2018, Cuyahoga County approved up to $1 million for Workforce Connect over the next three years, supplemented by an additional combined commitment of up to $1.5 million from the other members of the Workforce Funders Group. Contact Paris Wolfe: clbfreelancer@crain.com

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REMOTE

From Page 1

The hands-on jobs in some industries, such as manufacturing, don’t lend themselves to remote work, and accurate numbers on the size of the full-time remote workforce are elusive. A study published last September by Owl Labs , a videoconferencing firm, found that 62% of the 1,200 workers surveyed worked remotely some of the time. Of those, 30% reported working remotely full time. The Owl Labs study and others clearly suggest that the remote workforce will grow. A survey of 1,000 hiring managers by Upwork, a freelancing website, found that 73% of work teams will have remote workers by 2028 as younger managers take over hiring decisions. Northeast Ohio could be attractive to remote workers because of its low cost of living. That’s why Corey Snipes, a software engineer who works from Lakewood, moved with his wife and young children to Cleveland from Denver. Snipes works for Mosaic ATM, an aviation and air service software firm based in Leesburg, Va. “We liked Denver. We’d been out there for almost 20 years, but it was just getting increasingly expensive. It was turning into a bit of a hamster wheel,” he said. “So we started looking (for a place to move to) and the more we looked into it, the more (Cleveland) just ticked the boxes for what we wanted. It just seemed like a big upgrade to us.” His wife was raised in Toledo and went to college at Case Western Reserve University, but Snipes said those weren’t factors in choosing Northeast Ohio over other cities the couple gave a look: New Orleans; Portland, Ore.; Washington, D.C. “We were pretty set on Cleveland once we started,” he said. “It was mostly, ‘Do we want to uproot from

GENERATIONS

From Page 11

Anecdotal evidence aside, King said she is reluctant to adopt broad generalizations. However, she admits that some things are obvious. “The workplace has evolved over the past 50 years and, therefore, some who have been in the workforce that long may not be as comfortable in today’s work environment,” she noted. “We have changed the way we communicate, now relying on email and text messages much more than faceto-face or phone conversations. “That technology has also changed often where we work. There is a lot more flexibility and many workplaces offer options to work remotely or altered hours.” Different generations may have different perspectives on how and where work is done. Lori Long, professor in the School of Business and chair of the Department of Management and Entrepreneurship at Baldwin Wallace, pointed out that “differences can cause challenges. And when you consider just the differences in age between someone entering the workforce and someone near retirement, it is not surprising that there are conflicts in work styles or values. “What is happening now,” she added, “is that the sheer number of baby boomers has created an environment where there is a heavy population of workers in the ‘near retirement’ age group. Some of the financial market challenges about 10 years ago resulted in many people delaying retire-

Telecommuter Corey Snipes, a software engineer who works from Lakewood, moved with his wife and young children to Cleveland from Denver because of its low cost of living. Cleveland “just ticked the boxes for what we wanted,” he said. | CONTRIBUTED

Denver? Does Cleveland make sense?’ Yeah.” Destination Cleveland, the nonprofit that works to attract business and leisure travelers to the area, is working on a strategy to market Northeast Ohio as a place to come and find a job. In an email, Emily Lauer, senior director of communications, said the organization’s effort will focus on changing perceptions of the area, but the idea of helping people looking for remote jobs could be considered in its planning. Tulsa, Okla., with help from a local foundation, has already jumped into the competition for remote workers. There, in 2019, the local George Kaiser Family Foundation launched a program, called Tulsa Remote, that ment and staying longer in the workforce.” That changes the needs of the employees as well. First, to manage a multigenerational team and deal with its varKing ied needs, King said, it’s important to start with the self. “To me, it begins with yourself: knowing your motivations, leadership style, communication methods and behaviors,” she said. “Once you relate to and accept you, and strive to develop yourself, you can better relate to others. Then, knowing the same of your team and your boss, opens the door to a more effective, cohesive and aligned workplace.” Like many area colleges and universities, Baldwin Wallace offers a number of professional development programs in leadership, including self-assessments, relational-leadership improvement, skills training, team-building and more, as well as graduate and undergraduate degrees to facilitate leadership. “There is a lot of ‘trendy’ training offered on understanding generational differences,” noted Long, “but learning about working in teams and developing your leadership skills is valuable here. It will allow you to understand how to work with people with diverse backgrounds, whether they are age-related or otherwise.”

offers remote workers a financial incentive of as much as $10,000. Participants initially receive $2,500 for relocation expenses, followed by $500 monthly stipends and an additional $1,500 at the end of their first 12 months in Tulsa. They’ll also have the option of living in new furnished,utilities-paid apartments in the Tulsa Arts District for 33% off the base price for the first three months. The program has been renewed for this year and hopes to attract 250 resident remote workers in 2020. That appears to be the top end of remote worker recruiting, but other areas around the country are trying to make themselves attractive destinations for remote workers. Mika Cross, vice president of em-

ployer engagement at FlexJobs, an online service that helps people seeking remote, freelance or other flexible work situations, said a number of states are working to make their communities — in some cases their more rural communities — more attractive for telecommuters. She said she recently has been working with a tech company and the state of Kansas to help make the state more attractive to remote workers the company would hire. “(The company) provides the equipment to their workers, so if you’re selected, they’ll send you a full technical kit with a laptop and a headset and everything else you need to be successful,” Cross said. “The people on the ground in Kansas

are designing a co-working space to that employer’s specifications.” Flexjobs has identified other remote worker attraction programs in Colorado, Kentucky, Massachusetts and Utah. While most remote workers work from home, some use co-working spaces. Northeast Ohio has a growing number of such spaces, which offer everything from mailboxes to high-speed internet to coffee shops and yoga classes to help remote workers overcome the isolation of working from home. “When you work remotely, you lose out on water-cooler conversations,” noted Robert Clark, a local web developer who moved to Cleveland to be part of a startup business. At the time, he also considered relocating to Seattle. He now works for a company in Boston, but chose to stay in the Cleveland area. For those who want to be able to wander to the water cooler, the region has a number of co-working spaces that can accommodate both remote workers and their employers. Todd Goldstein, CEO of LaunchHouse, a co-working space in Highland Heights, said offering incentives to remote workers “would be a great thing. Co-working offers an avenue for remote works to be part of a co-working community.” LaunchHouse has about 150 members, Goldstein said, although fewer than 15% are true, full-time remote workers. Co-working spaces, though they come at a price, can in some parts of the country offer better broadband access or other tech amenities. For his part, Snipes said he hasn’t had any problems working from Lakewood, at least any telecommuting problems. “I think my big complaints, probably, from moving here would be the roads are pretty bad, you know?” he said. Jay Miller: jmiller@crain.com, (216) 771-5362, @millerjh

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THE LIST

Auto Dealers

Ranked by new vehicles sold in 2019 VEHICLES SOLD IN NORTHEAST OHIO IN 2019 RANK

COMPANY

NEW

TOTAL

PRIMARY BRANDS SOLD IN NORTHEAST OHIO (NEW CARS)

LOCAL DEALERSHIP LOCATIONS

Ganley Auto Group 8748 Brecksville Road, Suite 210, Brecksville 44141 440-584-8202/ganleyauto.com

29,822

60,494

Lincoln, Hyundai, Genesis, Ford, Nissan Volkswagen, Subaru, BMW, Chrysler, Jeep, Dodge, Ram, Fiat, Alfa Romeo, Maserati, Honda, Toyota, Mercedes-Benz, Buick, GMC, Cadillac

North Olmsted, Bedford, Brook Park, Akron, Aurora, Cleveland, Painesville, Norwalk, Barberton, Mayfield, Parma, Wickliffe, Middleburg Heights, Westlake, Strongsville, Medina

Classic Auto Group 8510 Tyler Blvd,, Mentor 44060 888-716-9933/driveclassic.com

10,768 (1)

18,641 (1)

BMW, Buick, Cadillac, Chevrolet, Chrysler, Dodge, Ford, Genesis, GMC, Honda, Hyundai, Jeep, Lexus, Lincoln, Mazda, Mini, Ram, Toyota, Volkswagen

Mentor, Cleveland, Streetsboro, Willoughby Hills, Madison, Painesville

Brunswick Auto Mart 3031 Center Road, Brunswick 44212 877-226-5780/brunswickautomart.com

10,520 (1)

12,631 (1)

Chrysler, Dodge, Jeep, Ram, Toyota, Subaru, Mazda, Volkswagen

Brunswick

Liberty Auto Group 5500 Warrensville Center Road, Maple Heights 44137 216-662-3673/libertyford.com

5,248

11,074

Ford, Lincoln

Maple Heights, Aurora, Brunswick, Canton, Parma Heights, Vermilion, Canton

Ron Marhofer Auto Family 3423 Darrow Road, Stow 44224 330-688-6644/marhofer.com

4,918

8,604

Buick, GMC, Chevrolet, Hyundai, Genesis, Nissan

Stow, Cuyahoga Falls, Green, North Canton

Penske Automotive Group 8555 Market St., Mentor 44060 440-974-9500/penskeautomotive.com

4,827 (1)

9,862 (1)

Honda, Toyota, Porsche, Audi, Mercedes-Benz

Mentor, Bedford, Beachwood

Sunnyside Automotive Group 7660 Pearl Road, Middleburg Heights 44130 440-243-9740/sunnysideauto.com

4,761 (1)

8,894 (1)

Toyota, Honda, Mitsubishi, Audi, Chevrolet, Hyundai, Mini

Middleburg Heights, North Olmsted, Elyria, Cleveland

Sarchione Auto Group 1572 State Route 44, Randolph 44265 330-325-9991/sarchione.com

4,515

8,580

Chevrolet, Ford, Lincoln

Alliance, Waynesburg, Randolph

Serra Auto Park (formerly Park Auto Group) 3281 S. Arlington Road, Akron 44312 888-476-1664/serraautopark.com

4,284

7,933

Honda, Acura, Mazda, Subaru and Chevrolet

Akron

Sweeney Auto Group 8010 Market St., Boardman 44512 844-417-7332/sweeneycars.com

4,182 (1)

5,978 (1)

Chevrolet, Buick, GMC

Boardman

Great Lakes Auto Network 43 Pruitt Blvd., Akron 44310 330-648-5423/greatlakesautonetwork.com

4,115 (1)

8,279 (1)

Honda, Hyundai, Chrysler, Dodge, Jeep, Ram, Chevrolet, GMC, Buick

Akron, Streetsboro, Kingsville, Jefferson, Elyria

Klaben Auto Group Inc. 1085 W. Main St., Kent 44240 330-673-3139/klaben.com

4,104 (1)

6,186 (1)

Ford, Lincoln, Chrysler, Jeep, Dodge, Ram

Kent, Warren

Fred Martin Auto Group 3195 Barber Road, Barberton 44203 330-753-4444/fredmartin.com

4,000

8,500

Chrysler, Dodge, Jeep, Ram, Fiat, Nissan

Barberton, Akron, Norton

Jay Auto Group 18800 Rockside Road, Bedford 44146 440-232-5000/jayauto.com

3,750

6,125

Honda, Buick, GMC, BMW, Volkswagen

Bedford, Akron

Waikem Auto Family 3910 Lincoln Way E., Massillon 44646 866-863-1448/waikem.com

3,534 (1)

5,947 (1)

Honda, Hyundai, Mitsubishi, Subaru, Kia, Ford

Massillon

AutoNation 23775 Center Ridge Road, Westlake 44145 440-296-3019/autonation.com

3,523 (1)

6,795 (1)

Ford

Westlake, Wickliffe, Amherst, North Canton

Serpentini Auto Group 15303 Royalton Road, Strongsville 44136 888-375-4810/serpentinichevy.com

3,394 (1)

6,790 (1)

Chevrolet, Buick

Strongsville, Orrville, Medina, Westlake, Willoughby, Tallmadge

Medina Auto Mall 3205 Medina Road, Medina 44256 330-723-3291/medinaautomall.net

3,173 (1)

4,750 (1)

Buick, Cadillac, GMC, Chrysler, Dodge, Jeep, Ram

Medina

Montrose Auto Group 3960 Medina Road, Akron 44333 888-498-8339/gomontrose.com

3,014 (1)

7,204 (1)

Ford, Kia, Mazda, Volvo, Jaguar, Land Rover

Fairlawn, Cleveland, Sheffield, Kent

Valley Ford Truck 5715 Canal Road, Valley View 44125 216-524-2400/valleyfordtruck.com

2,755

3,555

Ford

Cleveland, Akron, Huron, Monroeville

Halleen Kia 27932 Lorain Road, North Olmsted 44070 440-777-2424/halleenkia.com

2,682 (1)

3,945 (1)

Kia

North Olmsted, Sandusky

The VanDevere Bunch 1490 Vernon Odom Blvd., Akron 44320 330-867-3010/vandevere.com

2,672 (1)

7,153 (1)

Chevrolet, Kia, Buick

Akron

Big Nissan Auto Group 28500 Lorain Road, North Olmsted 440-734-6900/bignissan.com

2,456 (1)

3,959 (1)

Nissan

North Olmsted, Sheffield Village

Falls Motor City 4100 State Road, Cuyahoga Falls 44223 330-835-6657/fallsmotorcity.com

2,358 (1)

3,401 (1)

Chrysler, Dodge, Jeep, Ram

Cuyahoga Falls

Haasz Automall 4886 State Route 59, Ravenna 44266 330-296-2866/haaszautomall.com

2,234 (1)

3,966 (1)

Chrysler, Dodge, Jeep, and Ram

Ravenna, Dalton

Davis Automotive Group 6135 Kruse Drive, Solon 44139 440-542-0600/davisautomotive.com

2,000

BMW, Jaguar, Land Rover

Solon

Tesla Cleveland-Lyndhurst 5180 Mayfield Road, Lyndhurst 44124 440-461-1016/tesla.com

1,951 (1)

1,978 (1)

Tesla

Lyndhurst

RESEARCHED BY CHUCK SODER: CSODER@CRAIN.COM

Download all 34 dealership groups in Excel of PDF format. Become a Data Member: CrainsCleveland.com/data

Information is from the companies or company websites unless footnoted. Data from AutoView Online is based on state title registrations. Vehicle sales that were not registered before the end of 2019 may be excluded from AutoView numbers. When an address for the auto group was not available, Crain's listed the address of the group's largest dealership. Send feedback to Chuck Soder: csoder@crain.com (1) From AutoView Online 16 | CRAINâ&#x20AC;&#x2122;S CLEVELAND BUSINESS | February 24, 2020

CRAIN’S CLEVELAND BUSINESS

S E P T E M B E R 3 - 9 , 2 018

PA G E 17

AKRON RETAIL

Some Chapel Hill retailers are moving; others face uncertainty As the mall faces possible foreclosure, store owners are looking for places with more foot traffic BY DAN SHINGLER

Some of the few shops left at Akron’s Chapel Hill Mall are leaving, or preparing to leave, while others face uncertain futures with employees left waiting to hear what will happen to their jobs if the mall closes. That’s creating opportunities for other retail spots around Akron but also stress for many who count on the mall for their livelihoods. “There’s a lot of interest in Front Street,” said Ben Christopher, associate adviser for SVN | Summit Commercial Real Estate Group in Fairlawn. Christopher, who’s working with several landlords on Cuyahoga Falls’ newly revamped business district on Front Street, said he’s recently signed one Chapel Hill store owner to a lease there and is working with two others who are looking. “One is a Chapel Hill tenant who’s been at the mall for more than 20 years,” Christopher said. Front Street’s ability to attract tenants from a mall like Chapel Hill would have been an impossibility until recently. The street was closed to traffic for 40 years in an effort to turn it into a pedestrian shopping center that largely failed and ultimately left it mostly devoid of people. But since the city redesigned and reopened Front Street to traffic in 2018, the street has experienced a new vibrancy and greatly increased its foot traffic, Christopher said. “They’re anticipating more walk-in

Store closures and light foot traffic have been the norm at Chapel Hill Mall for some time, as shown in this 2017 photo. Now, some retailers are choosing to relocate their businesses to other areas. | CRAIN’S FILE PHOTO

traffic here now,” Christopher said of mall tenants attracted to Front Street. One client of Christopher’s who’s committed to Front Street is Rose Harkins, who with her daughter Annmarie Jones owns Gourmet Popper at Chapel Hill. The business, a large kiosk, has been selling cheeseand caramel-covered popcorn, along with other treats, for more than 20 years. Harkins’ family has owned it for the past 15 years, she said. “The mall was fabulous when we started 15 years ago, and it was still doing good when it was bought four years ago,” Harkins said. But now, at a mall she estimated is

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80% vacant, there just aren’t enough shoppers passing by, she said. The kiosk has cut its hours, and Harkins and Jones operate it without other employees. “It’s been absolutely crazy. We’ve been working so much more. You don’t want to have payroll when things are tough,” Harkins said. Gourmet Popper will leave Chapel Hill at the end of February and hopes to be open at 2052 Front Street by July, Harkins said. She’s confident her new location, near Cuyahoga Falls’ downtown pavilion, ice rink and other retail businesses on Front Street, will bring more business.

“I think we’ll get a lot of foot traffic. If they have concerts at the amphitheater or people are renting out the pavilion, we’ll get it. And they have a lot of foot traffic there on a regular weekend if the weather’s nice,” Harkins said. Meanwhile, others at the mall are in a state of near limbo as they watch the city of Akron, Summit County and others wrangle over tax and utility bills with mall owner Kohan Retail Investment Group of Great Neck, N.Y. The city repeatedly has threatened to shut off water to the mall and close it over what the city says are unpaid, six-figure water bills. According to media reports, FirstEnergy Corp. subsidiary Ohio Edison had threatened to shut off the electricity in December because of overdue bills before the owner submitted payment. Summit County has sued Kohan and began foreclosure proceedings against the mall in January. The mall is delinquent on its property taxes and had not paid its first-half tax bill by 11:30 a.m. Feb. 21, the day it was due, Summit County Fiscal Office chief of staff John LaMonica said by email. In total the mall owes the county $455,418, which includes $289,128 for the first half of 2019 and $166,290 in delinquent payments on previous taxes and assessments. Chapel Hill’s bill for the second half of 2019, also $289,128, will be due in July, LaMonica said. As of Feb. 20, Kohan had at least made some progress with the city. “The owner has paid a meaningful amount of the balance, and we are cautiously optimistic that the remaining delinquent balance will be paid in the coming months,” said Akron press secretary Ellen Lander Nischt in an email. When reached by phone, Kohan president Mike Kohan hung up when the reporter asked to schedule an interview. Kohan Retail specializes in investing in distressed malls and owns 29 malls across the country, according to its website. It reportedly paid $8.6

million when it purchased Chapel Hill in 2016 and earlier this February reportedly paid $10.2 million for Ashtabula Town Square. In the meantime, Akron’s Office of Integrated Development has heard from three retailers expressing interest in relocating from the mall, Lander Nischt said. That’s no surprise to those who have been watching the mall or working there. Harkins, along with two other store owners who declined to be named because they’ve not secured new locations, said they’ve been operating at the mall without leases for at least two years. The store owners still make monthly rent payments, they said, submitting what they think is a fair price for their space and never hearing a word about it from Kohan. They pay less than they did on their former leases, they said, because the mall does not provide the foot traffic it once did. Things look like they’ll get worse at Chapel Hill, too. The last anchor store at the mall, JCPenney, informed state officials Feb. 10 that it will close on April 24, eliminating 97 jobs in the process. Likewise, Kay Jewelers, one of the few other big-name retailers at the mall, is closing March 24, said David Bouffard, vice president for corporate affairs for Kay’s parent, Signet Jewelers of Fairlawn. Customers will be referred to Kay’s store in Stow, he said. Employees at a half dozen other stores didn’t know what their fate would be when Crain’s visited the mall on a Feb. 20. All said they’ve been told nothing with regard to what their stores intend to do if the mall closes, or if their stores will leave on their own accord. “We’ve seen a lot of them leave already,” Harkins said. “Even the food court, … there’s nothing in the food court now but Charleys (Philly Steaks) and an Asian place.” Dan Shingler: dshingler@crain.com, (216) 771-5290, @DanShingler

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2/21/2020 1:48:28 PM

BAGS

From Page 1

John Zagara, owner of Zagara’s Marketplace in Cleveland Heights, points to Ireland’s plastic bag environmental levy as the “gold standard” for dealing with the problems posed by single-use plastic bags. In 2002, Ireland imposed a 15cent levy (since raised to 22 cents) on each bag shoppers use (much like the solution Cleveland has proposed), according to The Irish Times. The levy reduced use of plastic shopping bags by 95%, the country’s minister for the environment, Dick Roche, told the Times. Annual per-capita use of the bags dropped from 328 to just 21. It seems that Irish shoppers got used to paying for their plastic bags.

John Zagara, owner of Zagara’s Marketplace in Cleveland Heights, said paper bags are not a solution to the plastic bag ban. “My suppliers are telling me there aren’t enough paper bag mills anymore for us to go back to using paper bags,” he said. | DAVID KORDALSKI/CRAIN’S

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PEOPLE ON THE MOVE

“This is not a new argument. All sorts of communities around the world are making it work,” Zagara said, noting that many of those communities face a variety of socioeconomic issues. If local governments had started charging shoppers a fee for using disposable plastic bags a decade ago, “the whole market could have been converted by now,” Zagara added. The makers of single-use plastic bags also have missed an opportunity, he said. “When we want to purchase reusable bags to sell … we’ve got to go to China to get them,” Zagara said. “All the bag manufacturers have missed the boat on producing a reusable bag.” While Cleveland is in the process of adopting a fee for shoppers who use single-use plastic bags, the county’s plastic bag ban is a problem for many grocers. Jeff Heinen, co-owner of Northeast Ohio’s Heinen’s chain, said he recognizes the environmental problem posed by single-use plastic bags, but in an online blog said banning the bags is not the answer. “Most experts believe that paper bags have an equal or greater negative impact on the environment, so making a switch from one type of bag to another does not accomplish the overall goal of reducing the environmental impact, especially since plastic bags account for less than 1% of all plastic waste,” he wrote in a May 30, 2019, blog post on his company’s website. Moving from plastic to paper bags also is costly for grocery stores. “A plastic bag ban is concerning to us as a business because paper bags cost five to six times more than plastic bags, which results in a $2 million to $3 million increase in our overall costs — an expense that many of our competitors in the online grocery retail and restaurant industry will not incur,” wrote Heinen, whose company recycles 100,000 pounds of plastic bags every year, among other recyclables. Heinen’s company representatives didn’t return calls seeking comment for this story. Late last year, Pittsburgh-based Giant Eagle announced that it planned to eliminate single-use plastics companywide by 2025 as part of its sustainability strategy. The plan launched in January at more than two dozen stores in three markets: Cuyahoga County; Bexley, near Columbus; and Pittsburgh. To help persuade customers to opt for reusable bags, Giant Eagle is offering one perk for its Fuelperks+ savings program for each reusable bag

customers use during a purchase in its Cuyahoga County stores. “In a few short weeks, we have given out more than 3 million perks across all of our stores chainwide, which equates to more than 3 million plastic bags that have been removed from landfills in our communities,” Giant Eagle spokesman Dan Donovan said in a statement. Target stores in Cuyahoga County offer alternatives to plastic bags, including paper bags or reusable plastic bags for purchase, the company said in a statement. “Target gives guests a 5-cent discount for each reusable bag used at all of our stores,” the company said. Heinen and his company supported 2017 legislation that proposed a 10-cent fee on both plastic and paper bags, according to his blog post. “This solution makes the most sense to us, as it gives shoppers a choice on whether or not to use a reusable bag rather than make the decision for them,” he wrote. Zagara is taking a wait-and-see approach. He started depleting his store’s supply of plastic bags last year around the time the Cuyahoga County ban was announced. But when the county postponed until July 1 fines on stores that continue using the bags, Zagara ordered another truckload of unbranded plastic bags.

“WHEN WE WANT TO PURCHASE REUSABLE BAGS TO SELL … WE’VE GOT TO GO TO CHINA TO GET THEM. ALL THE BAG MANUFACTURERS HAVE MISSED THE BOAT ON PRODUCING A REUSABLE BAG.” ——John Zagara, owner of Zagara’s Marketplace

“We’ll see how the state legislation moves through the system,” Zagara said. “The governor seems to be in favor of home rule, but the (plastic bag manufacturer) lobbyists are working against the plastic bag ban.” Getting more paper bags may be difficult for retailers. “My suppliers are telling me there aren’t enough paper bag mills anymore for us to go back to using paper bags,” Zagara said. The mills already have backlogged orders because of bans in cities like Chicago and Seattle, he noted. Zagara started giving shoppers a 5-cent credit for using their own bags 25 years ago. “I’ll keep the 5-cent credit in place for customers who bring their own bags,” he said. Why doesn’t Zagara impose a 5-cent fee on each customer who wants a single-use plastic bag from his store? Zagara is a single-store operation and it would be difficult to implement a ban on his own, he said, adding that most of his customers would vehemently oppose a self-assessed plastic bag fee. “I need the county and the state to lead the charge,” he said. “I support them in these efforts.” Contact Mary Vanac: clbfreelancer@crain.com

18 | CRAIN’S CLEVELAND BUSINESS | February 24, 2020

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2/21/2020 11:51:48 AM

CRAIN’S CLEVELAND LOOK BACK | GAMBLING IN OHIO

Ohio’s bet on gambling pays off

crainscleveland.com

Heading into November 2009, pro-gambling proposals in Ohio had gone 0-for-4 on Election Day in the previous two decades. Issue 3, which allowed for casinos to be built in Cincinnati, Cleveland, Columbus and Toledo, was different, because of the names (most notably, Cleveland Cavaliers owner Dan Gilbert) and considerable resources behind it, as well as the promises it made. Cleveland, more than a decade later, never got a $600 million casino on the riverfront. The gaming industry has changed so much, in fact, that real estate investment trusts are gobbling up casinos and racinos, then leasing the operations to others. Something that has remained steady, however, is the Buckeye State’s gambling revenues have gone up every year since the first casino opened in Cleveland in 2012. — Kevin Kleps

``THE HISTORY

``IN THEIR OWN WORDS

``WHY IT MATTERS TODAY

Cleveland’s casino, located in the historic Higbee Building downtown, originally carried the Horseshoe name and brand. Gilbert’s Rock Ventures purchased Caesars Entertainment Corp.’s 20% stake in 2015, and a year later, Rock Gaming’s casinos and racinos in Ohio and Michigan were rebranded as arms of Jack Entertainment. The wheeling and dealing really heated up in 2019, when Vici Properties, a Caesars spinoff, spent a combined $2.6 billion on Jack’s Cleveland, Cincinnati and Detroit casinos, plus Jack Thistledown Racino in North Randall. Jack ceded operations of the Cincinnati and Detroit casinos, but the $843.3 million deal it struck with Vici for the Cleveland casino and Thistledown last October included an agreement under which Jack will pay an annual rent of $65.9 million to operate two of Ohio’s top-performing gaming facilities. The Buckeye State’s leading gaming property, Northfield Park, changed hands in 2018, when a REIT carrying the MGM brand purchased the racino from Milstein Entertainment for $1.02 billion. Ohio’s 11 casinos and racinos are said to be attractive to buyers because state laws have limited the number to the existing locations. The demand for gaming in Northeast Ohio wasn’t sufficient for a second phase — a proposed 16-acre complex near the Cuyahoga River — to come to fruition, Jack Entertainment CEO Matt Cullen has said. The company says it has invested more than $700 million in its Cleveland and North Randall properties, which feature a combined 153,000 square feet of gaming space. The Cleveland casino’s gambling revenue increased $7.2 million, to a total of $212.1 million, in 2019. Thistledown’s revenue jumped $15.1 million, to $142.5 million.

“We’re going to deliver something very special.”

The casinos and racinos generated a record $1.94 billion in gambling revenue last year. The figure, which reflects the money that is left after winnings have been paid out, brought Ohio’s eight-year total to $11.9 billion — about one-third of which goes to the state in the form of taxes and fees. And while Ohio has continued to make gaming gains since the casino groups’ big victory in 2009, the Masurekar state has fallen behind its neighbors in the next gambling frontier: legalized sports betting. Separate bills were introduced in the House and Senate last year, with the House’s version falling under the control of the Lottery Commission and the Senate’s proposed bill being regulated by the Casino Control Commission. Unlike the 20 states that have legalized a lucrative industry that long had operated in the shadows, Ohio’s measures have stalled, with neither version getting a hearing since November. Bipartisan proponents remain hopeful, and Gov. Mike DeWine has said the state eventually will have sports betting, but key differences still must be ironed out. Delays in passing legislation, according to estimates, could cost the state eight figures in annual tax revenues. Jay Masurekar, the head of gaming and travel investment banking at KeyBanc Capital Markets in Cleveland, told Crain’s in 2019 that Ohio, once its industry matures, could have a $4 billion sports betting market. A market that size, with operators’ winnings projected at 5% and the state getting as much as 10% of that total (depending on the tax rate), could result in an annual haul of $15 million to $20 million.

——Dan Gilbert, Cleveland Cavaliers majority owner, following the passage of Issue 3. The Plain Dealer, November 2009

“At this point, our sense is the gaming market in Northeast Ohio doesn’t support additional capacity.” ——Matt Cullen, CEO, Jack Entertainment, on previous plans for a casino along the Cuyahoga River. Crain’s Cleveland, February 2016

“If there has ever been a favorable environment for a casino operator to cash out and take chips off the table, it is right now.” ——Alex Calderone, managing director, Calderone Advisory Group. Cleveland.com, October 2019

In 2016, Rock Gaming rebranded its Cleveland casino, left, and Thistledown racino in North Randall as arms of Jack Entertainment. | JACK ENTERTAINMENT

“If we’re trying to repair every broken bridge and road in the state, $30 million isn’t going to make much of a dent. To me, the question is where can the resources be applied most purposefully?” ——John Eklund, a Republican senator from Munson Township, on potential tax revenues from sports betting in Ohio. Crain’s Cleveland, March 2019

THE WEEK STARTING OVER: John Beilein resigned as the Cleveland Cavaliers’ head coach on Wednesday, Feb. 19, after a tumultuous 54 games in which the Cavs went just 14-40 and the coach and players rarely seemed on the same page. He was replaced by J.B. Bickerstaff, who was hired as an associate head coach prior to the season. The 40-year-old Bickerstaff twice has taken over for coaches during the season, in Houston and in Memphis. Bickerstaff is the Cavs’ sixth full-time head coach, and seventh overall, since 2013. JUST FOR FUND: Private equity firm Align Capital Partners closed its second investment fund at $450 million, 12.5% higher than its target size of $400 million. Align began raising the fund just four months ago. The firm,

which in 2016 also closed fundraising after four months, at $325 million, exceeding an initial $250 million target.

J.B. Bickerstaff, center, is taking over as the Cavs’ head coach after the departure of John Beilein. The pair are shown with Ante Zizic during a video review on Nov. 20, 2019. | MICHAEL REAVES/GETTY IMAGES

which is based in Cleveland with co-headquarters in Dallas, formed in 2016 when a trio of former principals

of The Riverside Co. splintered off to start their own business. The new Align fund builds on the firm’s first,

GEARING UP: The Greater Cleveland Partnership unveiled INGEAR (which stands for INdustry, Growth, Expansion, Attraction and Retention), a website that offers a centralized location providing resources to help navigate issues related to business growth, including general project management, real estate site selection, workforce needs, energy solutions and public sector matters. The INGEAR site, at gcpingear.com, includes a chat feature that provides real-time communication with a GCP business growth and development services team member who can answer questions and schedule an onsite visit or consultation calls.

Publisher/editor Elizabeth McIntyre (216) 771-5358 or emcintyre@crain.com Group publisher Mary Kramer (313) 446-0399 or mkramer@crain.com Managing editor Scott Suttell (216) 771-5227 or ssuttell@crain.com Sections editor Michael von Glahn (216) 771-5359 or mvonglahn@crain.com Creative director David Kordalski (216) 771-5169 or dkordalski@crain.com Web editor Damon Sims (216) 771-5279 or dasims@crain.com Associate editor/Akron Sue Walton (330) 802-4615 or swalton@crain.com Assistant editor Kevin Kleps (216) 771-5256 or kkleps@crain.com Senior data editor Chuck Soder (216) 771-5374 or csoder@crain.com Editorial researcher William Lucey (216) 771-5243 or wlucey@crain.com Cartoonist Rich Williams REPORTERS

Stan Bullard, senior reporter, Real estate/ construction. (216) 771-5228 or sbullard@crain.com Jay Miller, Government. (216) 771-5362 or jmiller@crain.com Rachel Abbey McCafferty, Manufacturing/energy/ education. (216) 771-5379 or rmccafferty@crain.com Jeremy Nobile, Finance/legal/beer/cannabis. (216) 771-5255 or jnobile@crain.com Kim Palmer, Government. (216) 771-5384 or kpalmer@crain.com Dan Shingler, Energy/steel/auto/Akron. (216) 771-5290 or dshingler@crain.com Lydia Coutré, Health care/nonprofits. (216) 771-5479 or lcoutre@crain.com ADVERTISING

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Customer service and subscriptions: (877) 824-9373 or customerservice@crainscleveland.com Reprints: Laura Picariello (732) 723-0569 or lpicariello@crain.com

Crain’s Cleveland Business is published by Crain Communications Inc. Chairman Keith E. Crain Vice chairman Mary Kay Crain President KC Crain Senior executive VP Chris Crain Secretary Lexie Crain Armstrong Chief Financial Officer Robert Recchia G.D. Crain Jr., Founder (1885-1973) Mrs. G.D. Crain Jr., Chairman (1911-1996) Editorial & Business Offices 700 W. St. Clair Ave., Suite 310, Cleveland, OH 44113-1230 (216) 522-1383 Volume 41, Number 7 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for the first issue in January, July and September, the last issue in May and the fourth issue in November, at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright © 2020 by Crain Communications Inc. Periodicals postage paid at Cleveland, OH, and at additional mailing offices. Price per copy: $2.00. Postmaster: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, MI 48207-2912. 1 (877) 824-9373. Subscriptions: In Ohio: 1 year - $64, 2 year - $110. Outside Ohio: 1 year - $110, 2 year - $195. Single copy, $2.00. Allow 4 weeks for change of address. For subscription information and delivery concerns send correspondence to Audience Development Department, Crain’s Cleveland Business, 1155 Gratiot Avenue, Detroit, MI, 48207-9911, or email to customerservice@crainscleveland.com, or call (877) 824-9373 (in the U.S. and Canada) or (313) 446-0450 (all other locations), or fax (313) 446-6777.

February 24, 2020 | CRAIN’S CLEVELAND BUSINESS | 19

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