Crain's Cleveland Business

MANUFACTURING Welser Profile opens new facility in Valley City, expanding its foothold in Northeast Ohio. PAGE 6

CRAIN’S LIST: Northeast Ohio’s largest residential property sales of 2022. PAGE 18

CRAINSCLEVELAND.COM I MAY 16, 2022

Questions mount on CRA overhaul

NET GAIN

Federal regulators pursue sweeping changes to law meant to combat redlining

Pickleball’s popularity is exploding in Cleveland

BY JEREMY NOBILE

BY JOE SCALZO

GETTY IMAGES/ISTOCK

For much of Michael Jurek’s life, pickleball was just a weird sport he played during gym class in high school.

Then, two years ago, he visited some friends down in Florida, which treats pickleball with the same level of passion that Clevelanders reserve for Baker Mayfield trade rumors.

“Florida is the hub of pickleball,” said Jurek, who co-founded the website ClevelandPickleball. com with his wife, Maddie. “They have stadiums for pickleball courts. It’s crazy. When my friends told me about it, I was like, ‘I can’t believe this is making a revival.’

“But my friends showed it to me, and I’ve essentially been hooked since then.”

See PICKLEBALL on Page 21

Office, retail project being built near Crocker Park

BY STAN BULLARD

A multimillion-dollar office and retail project first proposed in 2019 prior to the pandemic is starting to rise from the ground on a 16-acre site at 2207 Crocker Road.

Called Crocker Commons, the mixed-use project is far enough along that real estate developers proposing the project and the brokerage representing it have announced the

signing of the first three tenants for the retail portion of the complex.

Committing to the project are Shake Shack, the premium burger chain already represented in downtown Cleveland and Orange Village, as well as Choolaah Indian BBQ restaurant, which is in operation in Beachwood and has a location going in near the West Side Market on West 25th Street in Cleveland. Verizon, the cellular phone provider,

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also has agreed to lease space at the complex.

Moreover, Max Sussman, a vice president at Ponsky Capital Partners and Five Forty Investments, said in a prepared statement on the project that “leasing activity is robust” and another four tenants are in negotiations for retail space that will be available in the fall of 2022.

See CROCKER PARK on Page 22

THE

THE FIRST THREE TENANTS SIGNED ON FOR THE RETAIL PORTION OF THE COMPLEX ARE SHAKE SHACK, CHOOLAAH INDIAN BBQ RESTAURANT AND VERIZON.

LAND SCAPE

In Cleveland, the poorest big city in the country, low- and moderate-income (LMI) neighborhoods continue to see a dearth of mortgage lending that contributes to a cycle of poverty.

However, as federal regulators propose sweeping changes to the Community Reinvestment Act, which should result in the most comprehensive revamp of the 45-year-old law since 1995, lending and housing advocates hope that new or updated rules could lead to more effective policies that benefit the public.

“The central tenet of the law is to require lending in LMI neighborhoods.

If you are taking deposits and not making loans, you need to be held accountable and shouldn’t be getting an ‘outstanding’ rating,” said Charles Bromley, director of the Ohio Fair Lending Coalition. “This is an opportunity to put some teeth in the regulations and hold accountable banks and even the government. If (the government) spends millions of dollars on refreshing capital infrastructure, they should care about what is going on with neighbors next door.”

The CRA is designed to encourage depository institutions — that is, banks — to help meet the credit needs of the communities in which they do business, particularly LMI neighborhoods that lenders would otherwise have no legal obligation to serve.

The law was created in 1977 to combat the historic effects of redlining. But critics will say its impact on that front has been minimal when considering the comparative lack of lending in areas like Cleveland’s East Side — which was, indeed, redlined in decades past.

See CRA on Page 22

A CRAIN’S CLEVELAND PODCAST

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© 2022 University Hospitals COR 2008082

SPORTS BUSINESS

Cleveland Marathon inches closer to ‘normal’

BY JOE SCALZO

Running a marathon, as the saying goes, seems like a lot of work for a free banana.

That’s why the most important question afterward isn’t, “When did you finish?” It’s, “Why did you finish?”

“We all run for something,” said Dustin Basch, a sales manager at Don Basch Jewelers in Macedonia.

“Everyone has a ‘why’ when they run.

Something that drives and motivates them. Something that commemorates that date and time.”

For Dustin and his siblings, it’s to honor the legacy of their mother, Denise, who co-founded the business in 1979 and worked there for more than 40 years before dying in January of 2021. Consequently, at last October’s Union Home Mortgage Cleveland Marathon, Dustin and his siblings competed against each other in the 10K race to raise money for the Denise Basch Legacy Fund.

Denise spent years working as the athletic director at St. Barnabas Catholic School in Northfield, which raised funds through its annual “Night at the Races” event. The Basch family’s 10K competition, which they’ll repeat this month, has a similar format, with customers able to buy raffle tickets to bet on which of her four sons will win.

The four sons of Don Basch Jewelers’ founders will compete against each other in the 10K at the Union Home Mortgage Cleveland Marathon to raise money for the legacy fund of their late mother, Denise (center). Pictured from left are Daniel, Dustin, Dennis and Donny. Don Basch Jewelers is the official jeweler of the marathon. | DON BASCH JEWELERS

The “Pick Your Pony Fundraiser” has prizes for first, second, third and fourth place, with a ticket being pulled from each son’s basket. The first prize is a 14-karat white gold pendant worth $2,729.

“It went so well last year, we’re doing it again this year with a lot nicer prizes, to show people we are going to continue to help grow this,” said Dustin, who won last year.

Don Basch Jewelers also is supporting the marathon itself, serving as the official jeweler for the event, which is scheduled for Saturday, May 21 (5K and 10K), and Sunday, May 22 (marathon and half-marathon). The Health & Fitness Expo is Friday, May 20, at the Huntington Convention Center.

The marathon is back in its familiar late-May slot after going all-virtu-

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al in 2020, then getting pushed to October in 2021 due to the COVID-19 pandemic. Participation is still down from pre-pandemic levels, with race officials expecting between 8,000 and 9,000 runners, which is about 70% of the usual 12,000 to 15,000 participants.

“We’re certainly a long way back from where we were a year ago,” said Jack Staph, the race’s executive director and owner. “We’re going to run a race, and we’re going to have a VIP reception and brunches.

Maybe we won’t have as many runners, but it will still have a significant economic impact on the city, and that’s something we pride ourselves on.”

The marathon has raised more than $3 million for local charities since 1977, including $210,500 for 19 charities last October.

The event’s sponsors have helped make up for some of the lost revenue, Staph said, and Union Home Mortgage will again serve as the title sponsor after taking over for Rite Aid in 2021. University Hospital is the official medical provider and also serves as the title sponsor for the half-marathon, the Health & Fitness Expo and the kids’ run.

Bronze sponsors include Mayfield Heights-based Think Media Studios, which will produce race videos; city of Cleveland Water; Solon-based

Supply Side USA, which will provide health and safety items; and TMJ & Sleep Therapy Centre of Cleveland.

Planet Fitness is the marathon’s exclusive fitness partner, as well as the presenting sponsor of the 5K and 10K races. Truly is again the event’s exclusive hard seltzer, while Fat Head’s Brewery is the exclusive beer partner.

Meijer is back as the official grocer, Willoughby-based Moving Ahead Services is the exclusive moving and storage partner, Nuun is the official hydration partner, Cleveland-based Hughies is the production partner and the Cleveland YMCA’s “We Run This City” youth marathon program is a race partner.

“The sponsorship sales have gone extraordinarily well,” Staph said, “and most of the companies are from Cleveland.”

That includes Don Basch Jewelers, which was “shocked and amazed when the marathon asked us to come on board,” Dustin said.

“We bleed Cleveland,” he said.

“We’re from here and we love it.

We’re athletic people and we’ve always followed sports in the Cleveland area, so to be connected with something so large in our eyes, it’s a great honor.”

Joe Scalzo: joe.scalzo@crain.com, (216) 771-5256, @JoeScalzo01

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5/13/2022 1:02:45 PM

Q&A

Ohio’s new cyber adviser talks workforce training, building a talent pipeline

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In April, Gov. Mike DeWine tapped Kirk Herath to serve as the state’s first Cybersecurity Strategic Advisor, a position created to guide businesses in the state when dealing with cyberattacks.

Herath has been on the vanguard of the industry, with more than three decades of experience in the expanding field of cybersecurity as a retired vice president and chief privacy officer for Ohio-based Nationwide. He also serves as board chair of CyberOhio and is member of Ohio’s Cybersecurity Advisory Board — two initiatives designed to contend with the growing problem of cybersecurity threats.

“I am pleased that Kirk will bring this expertise to the state to ensure Ohio leads the nation in cybersecurity and resiliency and its cybersecurity workforce,” said DeWine in his executive order creating the advisory position that reports directly to him.

Crain’s spoke with Kirk Herath about his newly created role and what he sees as his most immediate and most pressing goals for the position.

— Kim Palmer (This conversation has been edited and condensed for length.)  Q: How would you describe this new position created by Gov. DeWine?

The position was created to help coordinate and integrate the disparate cybersecurity capabilities that exist across state government. I will also help facilitate workforce training in cybersecurity specifically. At this time when threats are very high, there is a huge demand for this talent, and we are not mentoring enough new professionals in this space. And then concurrently with that also coordinate with federal authorities. That could be the FBI, Homeland Security, Secret Service. I will also coordinate with other states on the best-practices side.

Then there are even a few other states that have roles that are close to this Cybersecurity Strategic Advisor role.  Q: This role is a direct report to the governor — what does that look like?

Broadly and ultimately, it’s to communicate what the environment looks like at any specific time to the governor. And to do it in a coordinated way using information from all of the disparate state agencies and give a nuanced answer to the question: Are we secure? It is nuanced because those answers are going to be slightly different from a military intelligence perspective or a law enforcement perspective, or from a civilian infrastructure agency security perspective. They all have different missions. My goal is to be able to come up with a synthesis to provide the governor on a periodic basis, and then at any given time be able to do a dive deeper into each sector.  Q: How are you preparing for what is a completely new position?

Right now, in information sponge mode, I’m learning what’s going on. There are things that I knew when I came in; and there are things I knew that I didn’t know; and every day there’s things I’m just finding out about.  Q: Talk about some of the work you did at CyberOhio, and how it might have prepared you for this new role.

DeWine created CyberOhio when he was at the AG’s office, and he had the forethought to bring together a group of private-sector experts in law, policy and technology to come up with a framework to help small businesses. It was small, medium sized businesses that he felt were, No. 1, unprepared for the risk and, No. 2, didn’t understand even the minimal things that they needed to do to mitigate risk. The Ohio Data Protection Act, which created a cybersecurity framework standard, was in part motivated by that. And then when DeWine became governor, one of the first things he did was move

4 | CRAIN’S CLEVELAND BUSINESS | MAY 16, 2022

CyberOhio over into the executive branch. Now CyberOhio is under Innovate Ohio, and the group has been working on computer fraud updates and on the Ohio Personal Protection Personal Privacy Act bill that is working its way through the legislature.  Q: Helping create a cybersecurity talent pool is another goal for the state. What are the ways you plan to achieve that goal?

Business and education groups have been working with Ohio Department of Higher Education to come up with new standards for computer science careers. There is a new state report with recommendations coming out that is going to start to set some standards for cybersecurity for the state’s K-12 students. Those recommendations will be a basic framework, with some sort of a minimum computer science requirement. If anything good came out of the pandemic, and I’m not saying the pandemic was good, but if anything came out of the pandemic, at least school systems, schools have a better understanding of how to teach virtually, since a lot of rural and urban school districts do not have qualified instructors to teach computer science. The state can help create distance learning for some schools that don’t have the means or the capability internally.  Q: What other K-12 initiatives are you interested in pursuing?

One of the things that seems clear to me is that guidance counselors in high school need to understand better what this cybersecurity profession entails and that you don’t have to be deep into STEM or be a computer science geek to be a cybersecurity professional. There’s a broad spectrum to the profession, and certainly there are elements of it if you get into forensics where having aptitude towards mathematics and computer science is probably a must, but you can also be a liberal arts major — all you have to know is how to be organized, write, understand, be logical. There’s a lot of logic in this field.  Q: Why is it important to create this cybersecurity talent pool in Ohio?

There are about 500,000 open jobs, broadly defined in cybersecurity, in the country right now. From there the estimates go up to the need for 2 million workers within five years. Which means there are good jobs out there for people with the right experience and training. Most companies today will take a trained person and teach them the ropes, but you’ve got these gaps in your workforce and companies need to secure their digital environments.

Right now, we’re all just cannibalizing

the same people. Trained professionals can go across the street, and they’re going get a signing bonus and 10% more. That’s the dynamic we’re in now.

We need to start creating, we need to open up that cybersecurity workforce pipeline, that spigot, immediately.  Q: What else are you planning to do with this new position?

I think I’m a cheerleader. For now, I’m going to operate collaboratively, because we have a lot of different missions competing here (in the state).

I’m going to have a role in holding people accountable for things that the governor has determined to be a priority and talking to him when there needs to be a decision between competing interests. Because there are always competing interests. Another role of the position is to go to the governor or lieutenant governor and say, “Here’s what we need. We need more resources or we need your political support.”  Q: Do you think businesses that you talk to realize what a growing threat cybersecurity is facing?

I think everybody sort of intellectually understands it. I think that when it comes down to having been in a large business for many decades, there are competing priorities for every dollar.

First of all, there’s no perfect security.

There really is a metric that says above this level, if you’re going to spend, you’re kind of almost wasting your money.

Perfection is unattainable. The CIA has been hacked. The NSA has been hacked.

There’s probably no better protected place in the world than those two organizations. And they have been hacked several times publicly that we know of. And I’m sure there’s things that we don’t know about. Going back to my role, it will be working with the cabinet and with the governor to try to figure out what is reasonably secure and when and where we need to keep investing.  Q: How long does it take someone to get up to speed in this kind of a job? What’s your transition time?

I’m hoping to have at least some minimum threshold recommendations to the governor and to the cabinet, but I think I’m at least two to four weeks away from something preliminary. There are governance elements that need to exist and some metrics that we need to collect to begin to manage workforce development, which is one of the first things to tackle.  Q: How did you end up in this position because you were retired; why do this?

DeWine knew that I had a passion for public service, and I knew that he believes that this is a pivotal issue. I believe that he has passion around cybersecurity and that he is going to provide the support to do what I need to do. I think it is clear he’s a visionary in this space. He saw it before almost anybody at the state level, and he provided us with a lot of support when he was in the AG’s office. I feel like I’ve got another set of races in me and I can make a difference. Whether that’s one year, two years, three years, four years — I think I can make a difference, and I think I can improve the community and the state.

Kim Palmer: kpalmer@crain.com, (216) 771-5384, @kimfouroffive

GOVERNMENT

New law makes reporting cyberattacks mandatory for some businesses

BY KIM PALMER

A new law making it mandatory for some businesses to report significant cyber and ransomware attacks to the federal government comes in the wake of the number of cyberattacks on corporate networks increasing 50% last year from 2020.

The Cyber Incident Reporting for Critical Infrastructure Act was passed in March. It followed cyberattacks reaching an all-time high at the end of 2021, according to a recent report by Check Point Research.

Specifics regarding what companies will be considered part of the critical infrastructure, and the type of cyberattacks that trigger a report to the Cybersecurity and Infrastructure Security Agency, or CISA, still need to be hashed out. And it could take a while. Final regulations are required to be in place by 2026.

The law does specify that companies in the government-defined critical infrastructure sectors will be mandatory reporters. The 16 sectors include obvious ones, such as nuclear utilities and defense facilities, but the classification also includes financial services, health care, manufacturing and chemical companies — all of which are in abundance in Northeast Ohio.

“Critical infrastructure in the region is not public. It’s actually estimated

that about 70% of the nation’s critical infrastructure is privately owned, like banks, manufacturing and hospitals,” said Jeff Brancato, program manager for the Northeast Ohio CyberConsortium or NEOCC. The goal of the reporting across multiple sectors is to create a government clearinghouse of timely information on cyberattacks to respond with an effective early warning system for others dealing with foreign or domestic bad actors.

Analysts at CISA also plan to use the data to spot trends to better understand how businesses are targeted and then deploy resources to render assistance to those affected.

“CISA WILL USE THESE REPORTS FROM OUR PRIVATE SECTOR PARTNERS TO BUILD A COMMON UNDERSTANDING OF HOW OUR ADVERSARIES ARE TARGETING U.S. NETWORKS AND CRITICAL INFRASTRUCTURE.” — Jen Easterly, CISA director

“CISA will use these reports from our private sector partners to build a common understanding of

how our adversaries are targeting U.S. networks and critical infrastructure,” said Jen Easterly, CISA director, in a statement about the law.

Brancato since Hacker 2015 has headed NEOCC, a nonprofit version of CISA that shares real-time cyber threat and defense information with companies and cybersecurity experts. He said mandatory reporting had the potential to provide better guidance when dealing with some of these cyberattacks.

“This is an area where the federal government is uniquely positioned to aggregate information in ways that other players cannot,” he said. “The opportunity for CISA to receive information from a much large set increases the effectiveness of these types of investigations.”

The Federal Bureau of Investigation and CISA have long encouraged companies to voluntarily report cyberattacks and ransomware payments. But that reporting, when forthcoming, has been spotty and often comes months after an attack, which is too late to warn others.

Those delays stymie attempts to

prevent similar attacks, said Damon Hacker, president and CEO of Medina company Vestige Digital Investigations, which encourages companies to file timely reports of cyberattacks to help stem largescale data breaches. The quick turnaround is important, Hacker said, because when a cyberattack hits a particular industry, it’s highly likely the attackers will move on to a similar company in that same industry.

keep attacks quiet. If they are able to resolve it, they don’t necessarily want to broadcast it out to the world,” said Alex Hamerstone, an advisory solutions director at TrustedSec. Hamerstone said he believes the collection of information under the mandatory reporting law could be helpful not only to the bigger companies equipped with the structures to respond to cyberattacks, but for small and midsize businesses. In those compa“A LOT OF THESE COMPANIES WANT TO KEEP nies, which often do not ATTACKS QUIET. IF THEY ARE ABLE TO have a chief RESOLVE IT, THEY DON’T NECESSARILY WANT i n f o r mat i o n security offiTO BROADCAST IT OUT TO THE WORLD.” cer, such problems roll — Alex Hamerstone, an advisory solutions director at TrustedSec directly to the owner or CEO. “One of the things that’s supposed CISA’s National Cyber Awareness to happen with this new law is that System caters to smaller businesses when CISA receives information (of offering voluntarily reporting and acan attack), within 24 hours (it) cess to current cybersecurity alerts, makes that available to potentially threat analysis and current activity affected sectors and industries,” reports.

Hacker said.

“You can’t manage what you can’t Voluntary reporting hasn’t tradi- measure. So having all this data and tionally been popular, because really understanding the scope of businesses have not jumped at the what’s happening, having it all at one chance to advertise a data breach place, helps people make decisions,” or ransomware payment, especial- Hamerstone said. ly when they involve private data loss.

Kim Palmer: kpalmer@crain.com, “A lot of these companies want to (216) 771-5384, @kimfouroffive

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5/13/2022 1:52:18 PM

MANUFACTURING

Welser Profile recently opened a new facility at 615 Liverpool Drive in Valley City. | WELSER PROFILE PHOTOS

Welser Profile has a long-term vision for Northeast Ohio

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Welser Profile isn’t a company that thinks short-term.

The roll-forming company was founded more than 350 years ago, in 1664. The company is still owned by the Welser family, now in its 11th generation of leadership with the 12th also involved, and it’s still based in its original home — meaning the site of its first foundry — in Austria. It’s a company with a longterm vision.

And that’s a vision that includes Northeast Ohio.

Welser Profile got its start as a forge, producing small iron products, said Lorenz Laengauer, who offers project support for the company in Austria and America. In the 1960s, the company purchased its first roll-forming line and began to expand in Europe.

The company made its first step into manufacturing in the U.S. in 2018, when it purchased Superior Roll Forming in Valley City. Welser Profile had long had customers in the U.S., said Bill Johnson, president and CEO of Welser Profile in North America, and the company’s current leadership was interested in expanding to the country.

Welser Profile isn’t a company that looks to acquire and then sell.

It’s a company that “once they set in their roots, they never really leave,” Johnson said. And Northeast Ohio offered fertile soil for that growth.

There’s a strong steel supply base in the region, and many of the company’s existing customers were located in the region, as well, he said.

And Northeast Ohio’s strong industrial workforce was of interest.

“We don’t have to go to the state of Ohio and say it’s important to have skilled workforce,” Johnson said. “They know that.”

And Superior Roll Forming was a particularly good fit. The company had been family-owned, too, and its strength in the automotive sector gave Welser Profile a stronger foothold in that space. And they’re a “technically driven company,” Johnson said, offering products that Welser Profile had yet to make.

This spring, Welser Profile expanded further in the U.S., adding a new plant also in Medina County.

The building at 615 Liverpool Drive in Valley City was purchased in early 2021, and the opening was officially celebrated at the end of April.

Bill Johnson is president and CEO of Welser Profile in North America.

The first line in the facility, which Johnson said was a “double-digit million-dollar investment,” is already up and running, and a second has been ordered. There are also plans for a third and fourth line in the facility in the future.

These lines are not small undertakings. They’re made of multiple pieces of equipment that can process, press and form metal, cutting holes and creating shapes as needed for each customer. Welser Profile isn’t making commodities on these lines, Johnson said; these are custom products.

The first line in the company’s new Valley City plant is one of the largest in Welser Profile’s fleet, Johnson said. (In terms an American audience would understand, it’s the length of a football field.) In total, the company has more than 90 roll-forming lines, Laengauer said.

When the new Valley City facility is completely running at scale, it will employ about 150, Johnson said.

Currently, there are 35 employees working there. Welser Profile has about 2,400 employees globally, with about 220 of those in Northeast Ohio, Laengauer said. In total, it sees about $900 million in sales.

Welser Profile has announced that it plans to invest $50 million in the Northeast Ohio facilities in the years to come, Johnson said.

The addition of Welser Profile is a plus for the region, said Bill Koehler, CEO of economic development organization Team NEO. The company has unique capabilities and serves customers in the region’s existing automotive supply chain, as well as in areas like aerospace where

the region can “continue to build,” he said.

“This is a great opportunity for Northeast Ohio, Medina County, to make sure we not only keep Superior Roll Forming here, but they’re making a significant investment that will add 150 new jobs over a reasonable period of time, which is great,” Koehler said.

The people and the expertise of Superior Roll Forming is what attracted Welser Profile to the company, said Bethany Dentler, executive director of the Medina County Economic Development Corporation.

But whenever a local company is purchased by a large corporation, “they’ve got choices,” Dentler said.

It’s important for local organizations like the Medina County Economic Development Corporation to show support, so that the company knows the area is a place “they could grow for the long term,” she added.

The corporation worked with other entities like the local port authority to offer programs and incentives as Welser Profile got its new plant up and running.

Dentler said she is hoping Northeast Ohio becomes the “heartbeat” of Welser Profile’s North American operations, growing like the company did in Europe.

Welser Profile’s 2040 strategy set a goal of having it become one of the top three roll-forming companies in North America, with 1,000 employees, Johnson said. Those may be lofty goals, but Johnson said the company went through a similar process when it expanded into Germany about two decades ago.

There’s a precedent.

Last year was a tough one for an expansion. But Welser Profile has been working toward its U.S. growth for years, Johnson said.

And, sometimes, it helps to go against the tide.

Other companies may be scaling back to manage a tough time, but Welser Profile doesn’t think that’s the way to create long-term success.

And it’s a good time to invest in the U.S. market, as the conflict in Ukraine is causing concern in Europe, he said.

“You need to be doing what everybody else is not doing in order to survive,” Johnson said.

Rachel Abbey McCafferty: (216) 7715379, rmccafferty@crain.com

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ADVISER

Five hacks to connect with your customers

BY LAURA SHERIDAN

Really understanding your customers is fundamental to realizing the greatest return on investment from your marketing and advertising.

Here are five hacks to uncover insights that enable you to connect with them.

Hack No. 1: Conduct primary customer research.

You need to hear from your most loyal customers, your least loyal customers, your newest customers and your most profitable customers. Call them. Better Sheridan is president of Viva yet, engage a third-party research firm to interview them. A third-party firm will also deliver actionable La Brand, a Cleveland-based and unbiased insights. Customers often won’t share their real feelings about a product or service when brand and they’re talking to their contact at your company. marketing Customer interviews should start with open-ended strategy, questions about their experience finding you. How research and did they hear about you? What made them check you agency search out online? What keywords did they use during the firm. shopping process? What criteria did they use to pick you? Then, follow-up prompts are used to uncover what drives their loyalty or conversely their decision to leave you.

By the way: If you’re using research from pre-COVID times to inform your marketing and media decisions, then you may be betting on the wrong horse. Your customers’ buying behaviors have changed, and for good. According to the EY US Future Consumer Index, which has been tracking changing consumer sentiment since the start of COVID-19, 54% of Americans agree that the new behaviors adopted during the pandemic now feel normal, and 49% believe that their lives will remain significantly changed in a post-pandemic world.

Hack No. 2: Mine the data you already own.

You have a trove of data about your customers from Google Analytics and other tools in your marketing technology stack. Google Analytics tells you what age groups are visiting your site, where visitors are located, if they’re on a laptop or phone, how they arrived at your site — organic search or paid ads — and so much more.

If you don’t have a Google Analytics account, no worries. There are a bazillion posts about setting up your Google Analytics account, including 95,200 videos on YouTube.

YOU HAVE A TROVE OF DATA ABOUT YOUR CUSTOMERS FROM GOOGLE ANALYTICS AND OTHER TOOLS IN YOUR MARKETING TECHNOLOGY STACK. Hack No. 3: Uncover what your customers are doing online.

Start by setting Google alerts for your top keywords, most desirable customer segments and your company. You pick how often you want to receive email notifications and the geographic region of your search.

Next, explore Twitter, LinkedIn, Instagram and Facebook. Search using keywords, titles of your hot prospects and topics they may be talking about. Read what’s being discussed. Interact if appropriate.

If you’re overwhelmed with data, then it may be time to try an AI sentiment analysis tool. These tools provide a way to filter customer feedback.

As text-based communication on social media and live chat are increasingly popular, there’s a real need for a sentiment analysis tool. Several offer free trials.

TFG Aviation Takes Off The Fedeli Group acquires Illinois-based Aviation Risk Management Associates

By Brooke Bilyj Crain’s Content Studio-Cleveland grow in niche areas like aviation where we have a lot of expertise and technical competency,” Fedeli said. “In order to differentiate ourselves, we have to really understand the industries we serve. We have to think about business risks from our clients’ perspectives, so we can become the go-to concierge for solving those challenges.”

I

n March of 2020, when many businesses were starting to close down, Nick Fedeli was still busy networking to expand The Fedeli Group. With a vision of being insurance specialists in certain industries, Fedeli’s philosophy is to expand into verticals in which the firm can utilize its intellectual capital.

“We want to be experts in many industries such as aviation, construction and real estate,” said Fedeli, who serves as executive vice president of the family-owned firm and directs the strategy for business development, recruiting and acquisition. Now, one of the relationships he forged during the lockdown is blooming into an acquisition that has doubled the size of TFG Aviation, The Fedeli Group’s aviation insurance practice.

“Strategically, we’re trying to

Fedeli has been actively growing TFG Aviation over the last decade since he joined the firm.

Prior to the acquisition, the practice insured more than $2 billion of aircraft value, serving aircraft companies, aircraft parts manufacturers and service providers operating around the globe. The latest transaction began with an introduction to Larry Galizi of Aviation Risk Management Associates from mutual friends who are brokers in London. The deal officially closed on May 1.

While Fedeli is always eyeing opportunities like these in various insurance specializations, The Fedeli Group doesn’t hesitate to walk away from potential mergers and acquisitions if they’re not a strategic fit. This acquisition is the perfect match, Fedeli says — not just because of the firm’s aviation focus, but because of the clientcentered culture that surrounds it.

the firm we’re acquiring is a lot like ours,” he says. “Their clients are at the center of their universe, the way our clients are at the center of ours.”

The acquisition will expand TFG Aviation’s client base and team size, adding specialized aviation expertise to deepen its existing practice. At the same time, The Fedeli Group’s risk management experience will strengthen the breadth of services available to the acquired firm.

“There are synergies, as we bring more value-added services to their existing clients,” Fedeli says. This deal combines the firm’s aviation focus with The Fedeli Group’s “wellroundedness and robust coverage competency” that spans professional liability, cyber security insurance, employee benefits and more.

The Fedeli family is evaluating other investment opportunities even outside the insurance industry. “First and foremost, we strive to be disciplined, astute investors,” Fedeli says. “However, with regards to The Fedeli Group, we want to continue to get better in order to engage and impact the lives of our clients.”

“This is ideal because culturally,

Hack No. 4: Identify the media channels your customers frequent.

Companies like SparkToro provide data on what your audience is talking about online and which websites they visit. That means you can track which industry e-newsletters your customers are reading, which trade association websites they’re visiting and other online media channels that you may not even know about.

Try SparkToro’s free software trial. Type in your customers’ titles or professions and see what media channels they frequent. Most media buying agencies subscribe to SRDS, the legacy media buying and planning tool. You may need both to get the whole picture.

Hack No. 5: Spark a dialogue.

One of the most direct and valuable ways to get to know your customers is to converse with them.

From surveys and polls to user-generated content (UGC), there are many ways to engage with customers. Around 85% of consumers find UGC more influential than your company’s photos or videos. Use hashtags to identify viral content that your audience might value. Engage with the creator and ask permission to share, and credit properly on your page. Then, repost and analyze the engagement.

It’s time to really connect with your customers. Follow these hacks and uncover insights to catapult the effectiveness of your marketing efforts.

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PERSONAL VIEW

Being a pro athlete gave me a competitive edge in business

RICH WILLIAMS FOR CRAIN’S CLEVELAND BUSINESS

BY CODY COUGHLIN

EDITORIAL

Don’t rush V

irtually nothing about the structure now talked about as the West Block building — we used to call it the Global Center for Health Innovation, and before that the Medical Mart — has gone according to plan.

The 235,000-square-foot facility on St. Clair Avenue opened in 2014 and, since then, has been a money-loser without a clear rationale for existing. That’s its original sin, and it’s not a good combination. The building today sits mostly empty, on a prime piece of downtown real estate. Its most productive use of late has been for socially distanced Cuyahoga County Common Pleas Court jury trials during the pandemic.

There’s a new plan, though, to renovate the building to add about 89,000 square feet of meeting space to the neighboring Huntington Convention Center of Cleveland. Backers led by Destination Cleveland propose changes that RACING TO PUT MORE would include doubling MONEY INTO A FACILITY the size of the junior THAT HAS DONE NOTHING ballroom and making it divisible into up to six BUT LOSE MONEY DOES flexible meeting rooms of 3,000 to 6,000 square NOT SEEM LIKE A WISE feet; creating an outSTRATEGY FOR door reception area on roof; adding elevaDETERMINING THE USE OF the tors and stairways; and FUTURE PUBLIC DOLLARS. upgrading the building’s technology. (The building’s atrium and first-floor junior ballroom were built as part of the convention center’s meeting space.)

The renovation price: $46 million, with $24 million coming from the Cuyahoga County Convention Facilities Development Corp. (CCCFDC) and $22 million — including $5 million in American Rescue Plan Act funds, a big ask in a county with a lot of needs that might supersede spending on meeting space — coming from Cuyahoga County. Under the proposal, a total of about $34 million would come from bond offerings.

In a recent presentation to Crain’s, David Gilbert, CEO of Destination Cleveland and a CCCFDC board member, said he expects additional tax revenue generated by the project

would cover the county’s half of annual debt payments, while added building revenues would cover those of CCCFDC. Gilbert and other advocates make a persuasive case that the existing convention center isn’t up to regional standards for an industry that’s bouncing back from the pandemic.

Among a peer group of 18 other convention centers, in cities including Indianapolis, Columbus and Pittsburgh, our center is below median figures in total space (318,300 square feet vs. a median of 388,000) and largest contiguous space (225,000 vs. 267,000). It also lacks space that accommodates modular setups and more natural light — features now in demand for convention centers.

A better alignment of the Global Center building with the convention center, the argument goes, would strengthen the booking hand of a facility that currently hosts 200 conventions, trade shows and events per year, and generates $150 million annually in direct economic spending. Destination Cleveland and CCCFDC forecast the project would create 490 hospitality jobs as well as $18.4 million in annual wages and $3.2 million in incremental tax revenue annually. A solid return — if those projections are right.

And yet ...

Backers want to move quickly, to get funding approved and work started to have tangible progress made by the time Cleveland in 2024 hosts the American Society of Association Executives, an influential group for securing future bookings. Cuyahoga County Council appeared receptive to the idea last week during a meeting of council’s Committee of the Whole.

But racing to put more money into a facility that has done nothing but lose money does not seem like a wise strategy for determining the use of future public dollars. It’s entirely possible that making the building an upgraded extension of the convention center is its best use. We’d be more comfortable, though, knowing that all avenues — including a sale or another public-sector use — have been explored and that this renovation/expansion is indeed worth a $46 million investment.

Executive 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

See EDITORIAL, on Page 22

It’s been less than a year since the NCAA allowed over half a million college athletes to profit off of their name, image and likeness. We are now seeing these young men and women turn into their own small businesses, bringing in hard-earned money from the sports they’ve spent their lives mastering. As a former professional race car driver, I know that transition can be difficult but rewarding.

Coughlin, a When I left the track at the end of my former NASCAR race career, I knew my time as a competi- racer, is CEO of tor wasn’t over. The skills I developed as an Cody Coughlin athlete, such as perseverance, knowing Co. He lives in the importance of a team, and the ability Delaware, Ohio. to adapt under pressure have been such an asset in my new venture of real estate and development.

After years of donning a fire suit and helmet, I decided to move into a different competitive arena, the race to buy and build real estate in booming Ohio. When I decided to get into real estate, I knew I was not the first or the biggest firm who had ideas of building a luxury apartment complex. Instead of being deterred by the competition, I’ve set out to make my first development, The Cody, a place that offers a unique living experience that people would want to call home. Knowing there are others pursuing the same goal as you can be intimidating.

However, I’ve learned, whether it’s real estate or sports, without competition there would be no innovation or drive. If I had listened to the doubters or skeptics, I may have decided to give up or look into a smaller venture, but it is the perseverance I learned on the race track that kept me moving toward my goal.

When I was younger, I looked up to Jeff Gordon. He was one of the greatest racers and what he did for the sport of racing can’t be overstated. By watching him, I saw how important those on his team and pit crew were to his success. You have to be able to humble yourself, ask others for feedback and support, and realize that even the best can’t do it alone. This is why my top advice for new entrepreneurs is to find your team; those who are knowledgeable and not afraid to be honest with you.

Without my team, I would not be preparing to open my first apartment complex this year. I also still believe in having role models and read as much as I can about those who inspire me, like Mark Cuban and Ray Dalio.

I wish I could say that every race and every business meeting has gone exactly how I planned. If that had been the case, I would have probably won a few more races, but I wouldn’t have the experiences I carry with me into every situation today.

When I ventured into the world of real estate development, it was far from an easy road. After months of work, seemingly perfect build locations would fall through, leaving us once again at square one. Each time a deal fell through, it hurt, I won’t lie, but I wouldn’t change a thing. That experience over the past few years is invaluable, and ultimately the location we chose, is one Intel also saw great value in, as it’s investing $20 billion just down the road. Whether it’s a big race or business deal, preparation is key, but so is being able to adapt under pressure.

I started racing competitively as a teenager, and like many young athletes, business skills were not at the forefront of my mind. Little did I know, I wasn’t just racing for the next win but to build the skills I lean on today. I want to tell today’s student athletes that the competitive spirit and edge you feel is something that never truly leaves you. The drive can easily be translated and harnessed into savvy business skills. I can’t wait to watch the fierce competitors we are watching now on the football field, volleyball court or pool to find their next adventure like I have.

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.

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THE FUTURE LEADERS PROGRAM

Why we made the switch to one stronger public radio operation for Northeast Ohio

BY KEVIN E. MARTIN

Six months ago, Ideastream Public Media and WKSU announced their plans to create one of Northeast Ohio’s largest news organizations, combining two award-winning news operations with the full range of other public radio programs that listeners in our region count on every day.

Since then, we’ve been working to merge our programming schedules, bring our staffs together, expand reporting and make the technological changes to grow our reach. On March 28, our vision for this new organization became a reality when our consolidated news and information public radio service for all of Northeast Ohio began broadcasting over WKSU, 89.7 FM. Many people have asked me why two competitors decided to join together. We each had ardent listener bases. We each had respected news operations. We both served our respective markets ably for many years. Yet, that was the crux of the issue.

For decades, Northeast Ohio had what is known in the industry as an “overlap market,” with two public radio stations providing much of the same programming to the same listening audience. WKSU and WCPN spent money buying the same programming, competed for the same resources, and employed teams of reporters who frequently covered the same stories.

We both spent a lot of money — a combined $1 million per year — that we don’t have to spend now that we’ve become one organization. Instead, that support from our communities can be invested in additional programming, on technologies that provide access to more people, and on expanding our local news reporting team to cover more stories throughout the communities in our region.

That’s really important when you consider what’s happened to local news reporting locally and nationally.

While Cleveland is fortunate to have a robust newspaper, five local television operations and a widely respected business weekly in Crain’s Cleveland Business, Ohio has been ground-zero for newspaper consolidations and closures. As reported by Policy Matters Ohio, no other state has experienced the radical changes in journalism to the extent Ohio has. In fact, Cuyahoga, Franklin and Hamilton counties all lost at least 50% of their newspaper jobs between 2004 and 2017, and the Akron Beacon Journal reduced its regular newsroom staff from about 170 two decades ago to just 30 today. In total, Ohio has 32% fewer newspapers than it did in 2004.

To truly address the most pressing issues in Northeast Ohio, we need strong local journalism to draw awareness to them, to foster understanding and to hold our leaders accountable.

Some have also asked me why we chose WKSU as our

Kevin E. Martin is president and CEO of Ideastream Public Media.

broadcasting signal instead of WCPN. This answer also aligns with our mission to expand news coverage throughout Northeast Ohio.

WKSU, with its network of repeater stations, has a stronger signal, much broader geographic coverage and already reaches a much larger audience that extends as far south as Mansfield. WCPN has a much smaller coverage area (including a large extension over Lake Erie), and utilizing that signal would have meant many more listeners would have been cut off from public radio pro-

gramming.

This doesn’t mean the switch hasn’t created some challenges.

Radio frequency transmission has always been an imperfect technology for complete coverage. Because of Northeast Ohio’s topography, the WKSU signal does not provide as strong of a signal for everyone we would like it to reach. We’re taking aggressive steps right now to address that problem and provide a strong signal to all of Northeast Ohio, including those areas with less-than-optimal coverage.

It’s a technical process that involves leasing property for new transmitters, purchasing equipment and, most critically, gaining approval from the Federal Communications Commission to boost the WKSU signal. It was an issue we knew we would face, but it also was one we could not fix without first demonstrating to the FCC that we had lost significant audience by making the change.

We’re optimistic we’ll be able to make our case to the commission once the data on this situation have been compiled and submitted.

In the meantime, we’re providing access to WKSU news and information in a variety of new ways. We’re broadcasting the WKSU programming on 104.9 FM to fill in areas that the 89.7 FM signal won’t reach and using the 25.7 WVIZ signal to carry WKSU on TVs that receive our signal over the air. And of course, we continue to lean into the steady migration of on-demand media habits by providing access to our news and information service via the ideastream.org livestream, smart speakers, HD channels and the new free Ideastream Public Media mobile app.

Every day, we are working to fulfill the vision Ideastream Public Media and WKSU had when we first began our analysis and discussions: to create a regional news service reaching 3.6 million listeners in 22 counties that will be financially strong for generations to come. I hope we can count you among those who tune into our stations every day. If you are, please encourage your neighbors and friends to tune in as well.

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Local community college programs see increase in interest. PAGE 13

HOT JOBS IN NORTHEAST OHIO

OHIO’S NEW JOB MARKET

Fill

Cleveland workers seeking new careers amid rebound

A

BY DOUGLAS J. GUTH

n old saying goes, “Be happy with what you have while working for what you want.” The pandemic erased both sides of that equation for some U.S. workers, leading to dissatisfaction and a search for a new career.

According to research from global staffing firm Robert Half, about 38% of professionals say COVID has hampered their current work, and that figure jumps to 66% for individuals aged 18 to 24. Respondents cited frustration with internal advancement, salary growth and skills development as factors contributing to career-move readiness.

As the job market continues to rebound from its virus-spurred doldrums, inquires across sectors such as health care, logistics and a steadily recovering travel industry are filling the inboxes of regional recruiters and employment organizations alike. An analysis from OhioMeansJobs reported a total of 102,239 job openings posted online from mid-February through mid-March 2022.

Among the top occupations listed over that period were registered nurses, retail supervisors, truck drivers and various computer-related positions. Employers with the most area job ads included University Hospitals, Cleveland Clinic, Dollar General, Deloitte and Anthem Inc. Covering work opportunities in 18 Ohio counties, the report highlighted the need for health care and IT-related talent, noted Matt Damschroder, director of the Ohio Department of Job and Family Services (ODJFS), which maintains the OhioMeansJobs website.

— Matt Damschroder, director of the Ohio Department of Job and Family Services

GETTY IMAGES/ISTOCK

“YOU CAN’T JUST RELY ON FINDING A PERSON THAT HAS EVERYTHING YOU WANT. IF SOMEONE HAS POTENTIAL, THEN YOU CAN BUILD THOSE OTHER SKILLS AROUND THE INDIVIDUAL.”

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H port Clev whe nee cord port Th is k men es i care emp to c forc am tem In nec —s and mun gram ly b add fact ed whi whi cred tryW ing sect tice tion wor acro insu vice “W are thos Blac Sha seni “Tho thou ing A ing lack “O for t seei hea not in such or p care P cuse opm jobs soft

FOCUS | HOT JOBS IN NORTHEAST OHIO Requested skill sets are industry-dependent, although the jobs report specified customer service, supervision and operations aptitudes, as well as mathematics knowledge and basic computer skills. Damschroder said the ongoing labor shortage has employers more open to on-the-job training than they may have been pre-pandemic.

“The labor market is re-evaluating minimum qualifications to lower barriers of entry into the workforce,” Damschroder said. “Because technology is infused into everything, you do need basic familiarity with computers. But employers are making sure to have training programs ready to build soft skills within those hires, rather than expecting those coming in. You can’t just rely on finding a person that has everything you want.

If someone has potential, then you can build those other skills around the individual.”

GETTY IMAGES/ISTOCK

Filling the talent pool Health care and health care support roles continue to derive from Cleveland’s major hospital systems, whereas companies like Deloitte need people with IT expertise, according to the OhioMeansJobs report.

The Greater Cleveland Partnership is keeping a close eye on employment trends, thanks to sector alliances in the manufacturing, IT, health care and construction arenas. These employer-led partnerships are meant to connect businesses with workforce development training to create a more efficient employment ecosystem.

In health care, the Workforce Connect Healthcare Sector partnership — spearheaded by regional hospitals and facilitated by Cuyahoga Community College — identifies programming around hot careers, ideally building long-term strategies to address worker shortages. A manufacturing sector partnership expedited by GCP and MAGNET, meanwhile, offers short-term training in which those who complete it receive credentials and eligibility for entry-level manufacturing positions.

With regional companies increasing investments in IT, an industry sector alliance is developing apprenticeship opportunities with the national Apprenti program. GCP is working to replicate this model across other high-demand sectors — insurance, hospitality, financial services and more.

“We’re also looking for folks who are not currently represented in those in-demand industries — Blacks, Latinos and women,” said Shana Marbury, general counsel and senior vice president of talent at GCP. “Those are our target populations, though through our work we’re looking at the larger talent gap.”

A goal is providing family-sustaining wages for high school graduates lacking a real career path.

“Our training efforts are a good fit for them,” Marbury said. “We’re still seeing demand in manufacturing, IT, health care and finance, which has not changed post-COVID. Growth is in entry-level manufacturing jobs such as machinists and technicians, or patient-care positions in health care.”

Programming in IT is more focused on mid-level software development, while new manufacturing jobs require a mix of technical and soft skills fit for work on the shop

Ohio Department of Job and Family Services director Matt Damschroder, left, during his tour of the Northwest Ohio Carpenters’ Joint Apprenticeship and Training Committee (JATC) Training Center in Rossford. He’s speaking with Aaron Gunderman, lead commercial carpentry instructor for the Northwest Ohio Carpenters’ JATC. | CONTRIBUTED

floor. In manufacturing, applicants understanding concepts around interviewing, team building and collaboration are being hired with no previous manufacturing experience.

“Most employers will say, 'Give me a smart, capable, curious person with those soft skills, then those technical skills can be taught,’” Marbury said.

A new way of thinking GCP was a partner organization for In-Demand Jobs Week, which took place across the state the first week in May. Bringing job-seekers the latest on lucrative work demands outreach, whether through service provider partners or word-of-mouth from past program participants.

The organization also connects low-income adults to sustainable careers via a partnership with the OhioMeansJobs Young Adult Resource Center. Additionally, GCP’s business members, partners and other community stakeholders are linking to Cleveland Metropolitan School District students through PACE, an initiative that emphasizes awareness of careers in the lower grades before progressing to exploration, planning, internships and jobs for graduating seniors.

“Programming off the table before COVID is what our employers are looking at now,” Marbury said.

“Concepts including sector partnerships, apprenticeships and collaborations between companies are new tools.”

The pandemic opened professional minds to a set of new possibilities, remarked Robert Half regional director Jill Turski, whose service area includes Toledo, Cleveland, Beachwood and North Olmsted. Referring to the agency survey, Turski said nearly one-third of U.S. workers have the desire to pursue a more meaningful and fulfilling career.

Administrative and customer assistance encompass some of the generalized openings encountered by Robert Half. Health care is seeing an uptick in revenue cycle analysts and front-end developers — in the area of law, attorneys with four to nine years of experience are in strong demand.

“As teams take on more projects, employers are saying we need to increase our headcount,” Turski said.

“This could mean adding permanent positions or bringing in contract workers. Contract workers can help with heavier workloads and allow companies to flex up or down.”

Employers also need to be concerned about retention, especially among younger professionals who may move on if they feel unchallenged, said Damschroder of ODJFS. To that end, managers are investing

at the height of coronavirus-related lockdowns in the spring of 2020, per U.S. Labor Department figures. Organizations seeking talent have a suite of tools at hand to attract and retain people casting about for change.

“We’re excited about this work,” Turski said. “This is such an interesting time with employees thinking outside the box.”

Contact Douglas J. Guth: clbfreelancer@crain.com

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in upskilling, review performances and mentoring programs that benefit all employees.

“Someone at a manufacturing company can get certification for robotic technology used by that company, or for different software tools so that acquisition costs of future labor are limited,” Damschroder said. “Employers have to be creative, depending on the type of workers they’re looking to recruit.”

The U.S. economy has regained nearly 95% of the 22 million jobs lost

MAY 16, 2022 | CRAIN’S CLEVELAND BUSINESS | 11 4/21/22 6:25 PM

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FOCUS | HOT JOBS IN NORTHEAST OHIO

GETTY IMAGES/ISTOCK PHOTO

WorkAdvance leads underserved workers down the path to a sustainable career

A job applicant finding work is something to celebrate, but it’s only a first step on a longer road, notes Jill Rizika, executive director of Towards Employment. The larger goal — one enthusiastically supported by the Cleveland-based job training and placement agency — is helping workers build a family-sustaining livelihood.

In 2011, the organization joined a national pilot that tested the WorkAdvance career pathway program across four communities. Locally coordinated by Towards Employment with support from the Fund for Our Economic Future, the pilot evaluated about 700 would-be Rizika workers in Cuyahoga County. Most program participants came from minority and underrepresented neighborhoods.

The WorkAdvance model centers on industry-specific recruitment, work experience and career planning. The program also includes post-employment advancement coaching and in-house legal services to address economic mobility barriers.

Local results demonstrated the project’s effectiveness compared with traditional workforce training, according to a report published by Towards Employment at the end of 2021. Alongside the increased likelihood of getting hired into jobs with strong career-advancement prospects, participants earned about $5,000 more annually than members of a control group.

Additionally, WorkAdvance members were four times more likely than their conventional program counterparts to complete technical training.

Since the conclusion of the program’s research phase in 2016, Towards Employment has been focusing on racial equity while seeking ways to expand career pathway programming. Lessons on how to bolster access to lucrative careers can resonate in the years ahead, ideally removing barriers for people seeking on-ramps to opportunity, Rizika told Crain’s in a recent conversation, which has been edited for clarity.

— Douglas J. Guth

math. We also worked with people with housing instability and criminal backgrounds who could not connect to education and training.

` Q: What was Towards Employment’s involvement in the WorkAdvance program?

A: Our role was in recruiting, screening, career coaching and leveraging community resources like Aspire Greater Cleveland (adult education service nonprofit). We managed all data across the evaluation, getting intelligence from employers and learning about skill sets they needed.

Then we recruited cohorts to train

` Q: What are the pillars of the WorkAdvance model in connecting job seekers to high-demand industry sectors?

A: This is a sector-specific training different from traditional workforce programming. People coming into a traditional program may not have the same career goals. With WorkAdvance, participants have a targeted career goal around manufacturing or health care, and the rest of the program is

in those skills and get long-term coaching. ` Q: What populations was the initiative targeted toward?

A: The sweet spot for the demonstration project was people who have had challenges connecting to the labor market. The initial focus was on individuals with no post-secondary education, or those with eighth- to 10th-grade levels of reading and

` Q: Generally, what are the key factors that make career pathways difficult to access for underserved job seekers?

A: We focused on the social determinants of work, not just education and training.

Do you live close enough to a work site to get there, or have access to dependable child care? Do the jobs you can access have stable enough schedules that let you coordinate these other things?

Another huge factor is the digital divide. Even if people have access to work, they may not have had those digital skills. As work becomes more digital, the divide highlights disparities and leaves people behind. ` Q: In what ways has the pandemic exacerbated these issues?

A: The hardest-hit individuals were essential workers, either in hospitality where they lost their jobs, or in entrylevel health care or transportation jobs that made them vulnerable (to illness).

People either didn’t have access to earn a living, or were forced to continue working where other people had choices on how safe they wanted to be.

contextualized for that industry.

We might put people on a plant floor or in a patient’s room at a hospital. Those skills are different, so you have to do as much contextualization as possible. ` Q: What kind of continuing support does the program provide?

A: Coaching starts right away. We ask people about their long-term plans, then map out pathways. There are basic things like getting to work on time. Or if someone loses housing or has a health issue, a coach can refer them to the right case manager. There’s financial coaching, too.

Sector partnerships can be an on-ramp to developing pipelines to industries and be a bridge between employers and the broader community. Those relationships define what curriculum looks like, what supports are available and who’s interested in what career pathways. The on-ramp function helps with training during onboarding, as well as any coaching employees need so they get support with the transition or additional upskilling. Support is tied very specifically to the job at hand. ` Q: What outcomes point to the program’s overall success?

A: We found that WorkAdvance participants were earning a higher wage threshold than the control groups, even as rates of employment faded over time. The program also narrowed the wage gap among Blacks, Latinos and whites. While whites still earned more, Black participants in the program group earned more than Black participants in the control group.

Group members were also more likely to work regular shifts, full time, and in the targeted sector they had been trained for. Even though the services made a difference for the Black participants as

individuals, it was still not enough to overcome the systemic problems that tamp down Blacks’ ability to earn. ` Q: How can the WorkAdvance approach be scaled up and strengthened?

As we get more people into the workforce and address racial disparities, we have to fix not only the workforce, but the work itself. In terms of hiring people earlier, and bringing them in for postemployment coaching and connecting them to community resources.

The on-ramp to onboarding and ongoing coaching is something that can scale up immediately. The first thing is having employers think about (WorkAdvance) as a model, while working with actors in the community that understand supports and how they can be delivered efficiently in the context of the workplace. Working in sector partnerships is a way to create a table (for underserved populations).

What makes these partnerships robust is you can try different programs that will make community support more equitable. ` Q: Looking at the big picture, how are economic mobility and access to good jobs tied to education and training?

A: Since the report was published, we continue to see the importance of the WorkAdvance model in addressing disparities and thinking about how we can get people into work faster. For the region to grow, we need all potential workers to have access to the supports they need so they’re eligible for goodpaying jobs. Employers need to be part of this solution — they can’t just sit back and wait for trained people to emerge.

Contact Douglas J. Guth: clbfreelancer@crain.com

12 | CRAIN’S CLEVELAND BUSINESS | MAY 16, 2022

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FOCUS | HOT JOBS IN NORTHEAST OHIO

Cybersecurity programs see growth at local community colleges

BY AMY MORONA

realistic,” Baker said.

Some community college graduCommunity colleges nationwide ates do go on to get those advanced saw big enrollment declines during degrees at four-year institutions. But the pandemic. Northeast Ohio’s two- amid a booming job market, some year public colleges — that’s companies are shifting their work reCuyahoga Community College, Lo- quirements.

The Clinic is one of them. Experirain County Community College, Stark State College and Lakeland ence can offset degree requirements Community College — weren’t ex- for internal candidates looking to be empt from those dips, either. Each promoted. Some of the more entry or saw drops in full-time enrollment in junior-level roles in areas related to information technology for new hires the fall 2020 and 2021 semesters.

But even amid those big declines, have seen degree requirements elimsome individual programs at the col- inated. CIO Kull said the Clinic is also leges reported growth. All four insti- working to develop its own educatutions reported increases in degree tional programs to build a pipeline of and certificate offerings related to people interested in cybersecurity.

And while officials at KeyBank said cybersecurity.

Tech giant Cisco defines the term a four-year degree is “preferred” for as a “practice of protecting systems, the bulk of positions within its technetworks, and programs from digital nology, operations and services deattacks,” adding those hits could in- partment, people with two-year declude “accessing, changing, or de- grees or other certifications are stroying sensitive information, ex- encouraged to apply. The company torting money from users, or said it offers various types of training interrupting normal business pro- resources and programs so employees “can continuously develop and cesses.”

“As more and more of our world expand their knowledge, skills and goes digital, and more and more of abilities.”

The scope of entry-level jobs in the our transactions in our everyday life are occurring online, the ability to field can vary. Nick DiTirro, professor protect information is going to be in of information technologies and incredible demand,” said Matthew computer science at Lakeland ComKull, chief information officer at the munity College, said many graduates of its offerings start in technical supCleveland Clinic.

This comes as jobs related to the port or help desk support roles.

One example of this type of role is wide-reaching field are expected to grow as fast or faster than average a computer network support specialrates during this decade. Kull called ist position. The state government the demand for cybersecurity profes- recently advertised it as having a mesionals “astronomical,” adding there dian salary of $60,000 with nearly 750 are three open cybersecurity posi- open positions. DiTirro refers to tions for every one qualified candi- these types of jobs as “landing positions” for graduates. date.

“They're gaining additional technical knowl“BUILDING A ROBUST WORKFORCE edge and skills in cyberPIPELINE BENEFITS BOTH security, and then from point on, they can STUDENTS AND LOCAL BUSINESSES.” that branch off into more job — Walter G. Bumphus, president and CEO of the titles that would have American Association of Community Colleges specifically cybersecurity in them,” he said.

Barriers to entry exist, though, esAn April 2022 bulletin from the Greater Cleveland Partnership and pecially in regard to building pipeits tech talent arm RITE lists cyberse- lines. Fields related to STEM areas curity as one of the top IT invest- (science, technology, engineering, ments now and within the next five math) have traditionally struggled to years. New roles in the region are connect with women and nonwhite emerging in that area, too. The report people. And just being in Cleveland found about 75% of IT postings re- could be an obstacle, too. It earned a quire some type of postsecondary 2019 distinction as the worst connected city in the country. credential or certification.

There have been efforts to help That’s where local colleges can come in. Lakeland Community Col- change that. Cleveland State Univerlege launched its cybersecurity offer- sity held the latest installment of the ing in 2019, thanks in part to a grant annual Women in Cybersecurity (Wifrom an arm of the Cleveland Foun- CyS) event earlier this year. Cuyahoga Community College is part of a redation.

Officials at Lakeland reached out cently announced cohort of two-year to companies of all sizes when it was colleges nationwide partnering with establishing the program. They asked Microsoft to help boost city residents’ about companies’ cybersecurity cyber skills.

“Building a robust workforce pipeneeds, what faculty and staff should be teaching, what types of skill sets line benefits both students and local employers wanted to see from new businesses,” Walter G. Bumphus, president and CEO of the American graduates.

They spent a lot of time “cultivat- Association of Community Colleges, ing” that information, according to said in a news release about the iniSue Baker, professor and department tiative. “Community colleges are well chair for Lakeland’s department of positioned to help the technology ininformation technology and com- dustry train and hire a skilled and diputer science. One challenge was fig- verse workforce across the country.”

On a more micro level, officials at uring out what type of curriculum to create for a two-year public institu- Lorain County Community College tion in a field with so much breadth have a multi-pronged approach.

They’re reaching out to traditionand depth.

“Would it be great if all of their al-aged high school students as “they candidates have bachelor's or gradu- don't have to learn what Facebook or ate-level degrees? Sure, but that's not TikTok is,” said Larry Atkinson, asso-

Devin Filak, pictured here, will graduate from Lorain County Community College this spring with an associate’s degree in cyber and information security. He works as a cybersecurity analyst for FortressSRM in Cleveland. | LORAIN COUNTY COMMUNITY COLLEGE

ciate professor and program coordinator of LCCC’s cybersecurity offerings.

But there’s also more emphasis put on connecting with displaced workers and/or individuals who are looking to re-enter the workforce. It’s

coupled with a push to reach out to people looking to transition to a new field. Bringing skills from other sectors could be a big push in cybersecurity areas, Atkinson said.

“It is not the number of companies or one company that's hiring a lot of

our students,” he said. “It’s the need of all companies to hire a few of our students. Every company needs a cybersecurity specialist.”

Amy Morona: amy.morona@crain. com, (216) 771-5229, @AmyMorona

I employ Y.O.U. youth “because it is my mission to create memories and give our youth a fighting chance. My favorite hashtag is #MentoringMatters and Y.O.U. allows me to live out my dream of mentoring our youth.”

Hikia “Coco” Dixon Young Adult Opportunities Program Employer CEO of Coco’s Chalky Paints Inventor of Coco’s Chalky Powder Invest today in Northeast Ohio’s future workforce • youthopportunities.org MAY 16, 2022 | CRAIN’S CLEVELAND BUSINESS | 13

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Employee benefits

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Customizing benefits plans according to talent pool trends The pandemic has redefined workplace norms. Employers large and small are adjusting talent recruitment and retention strategies to adjust for new expectations, such as more flexible work schedules and a holistic approach to employee benefits offerings. Gartner, a global technological research and consulting firm, notes that major post-pandemic work trends include an increase in remote working, more data collection, contingent worker expansion and a rising emphasis on an employer’s need to serve as a social safety net for employees’ physical, mental and financial well-being.

Here is a look at some workforce trends and benefit plan considerations that employers should take into account in the current talent climate:

Benefit plan considerations your organization should weigh

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he pandemic changed a lot of things for a lot of businesses, and employers have been struggling to reel in high-quality talent ever since. Increasing pay can help, but it isn’t always an option. Fortunately, your benefit plans can also set you apart from the competition. Here are just a few ways you can tweak your benefit programs to help you land new talent and retain existing employees.

REEVALUATE YOUR BENEFIT PROGRAMS

NEW SOLUTIONS Despite a health benefit cost hike in 2021 – particularly among small employers – companies have opted not to pass along the cost burden to employees, according to Mercer’s 2021 National Survey of EmployerSponsored Health Plans. Instead, they focus on supporting employees’ behavioral health, adding virtual health care solutions and seeking new ways to engage employees, whether they are at the office or remote.

CONTINUING EDUCATION INVESTMENTS Organizations that fundamentally value the contributions of each employee embrace the idea that each individual is central to team success.The so-called “Love + Work” organization model views employees as an integration point for stakeholders, and not just one individual of many, according to The Harvard Business Review. Benefits are tailored as investments, such as providing direct payment for college degrees, student loan reimbursements or giving employees discretionary time to pursue their own projects.

IN ALIGNMENT Overall, about 60% of employees are extremely or very satisfied with their current job, according to the Employee Benefit Research Institute’s 2021 Workplace Wellness Survey. Since the COVID-19 pandemic, 31% feel their employers’ efforts to improve their well-being have increased. However, about 60% say efforts have remained the same.

BENEFITS THAT MATTER While health care benefits remain the most desirable, employees have shifted their views on what other benefits also matter, according to Society for Human Resource Management.Their 2020 Employee Benefits report includes a ranking of benefits that respondents consider to be extremely or very important: • 90%: Health care • 83%: Flexible work • 83%: Leave • 76%: Working for a family friendly business • 62%: Wellness • 55%: Retirement

TAKING CARE OF CAREGIVERS That same report found that more employers increased their family focused leave options and paid family leave beyond the requirements of the Family and Medical Leave Act due to the added burdens of caregiving driven by the COVID-19 pandemic. The FMLA includes up to 12 weeks of unpaid leave during a 12-month period for eligible employees. The share of organizations offering paid family leave increased by 7 points, from 23% to 31% in 2020.

SOURCES: Employee Benefit Research Institute, Gartner, Harvard Business Review, Society for Human Resource Management Compiled by Kathy Ames Carr, Crain’s Content Studio - Cleveland

What benefit programs do you offer now?

Do these benefit programs appeal to the Workforce of 2022?

It’s possible that the programs you offer aren’t as valuable to your employees as they once were. For example, if your business implemented remote or flexible work schedules in 2020 or 2021, your benefits will almost certainly need to change. Replacing a parking and transit benefit program with mental health support or better childcare benefits could be just the change your employees want to see.

GAIN INTEL Gather as much information as you can from peers in your industry and from other local businesses. If you learn where successful companies are spending their money, you can figure out what benefits are most valued.

The SHRM Benefits Survey is a great place to start. The results of the 2020 survey show that employers have been changing their benefit plan offerings in recent years, likely in response to COVID-19. For example, 78% of employer respondents said they increased options for their employees to work remotely and 39% expanded childcare benefits. You may want to consider doing the same.

But take survey information like this with a grain of salt. Your employees’ desires and expectations should be the driving force behind your benefit plan decisions. Talk to your employees about what perks they value most and focus your energy there.

REEVALUATE THE COMPANY’S BENEFIT STRUCTURE Another way to meet the needs of individual employees is to have a la carte options. Your main benefits (like your health insurance and retirement plan) will likely need to be the same for all employees, but you can offer different add-ons that employees can elect into. For example, if you offered a childcare flexible spending account (FSA), employees with small children can opt in while employees without children can simply not participate.

To compile the right types of offerings, get familiar with your employees’ demographics. Average age, income level

MICHELLE H. BUCKLEY, CPA, AIFA® Vice president, practice leader, Benefit Plan Group mbuckley@meadenmoore.com 216-928-5379 Michelle is a vice president in Meaden & Moore’s Assurance Services Group with over 30 years of public accounting experience serving middle market companies focused on manufacturing, distribution and service industries. Michelle’s primary responsibility is to ensure that each of her clients receive high-quality, timely service. She continually looks for ways to reduce the costs of the engagement while finding ways to add value to the relationship.

As a practice leader of the firm’s employee benefits and consulting practice, Michelle has had extensive experience with qualified benefit plan audits, operational reviews, tax issues and the unique complexities of these engagements. She understands the risks to plan sponsors and continuously offers suggestions for improvement to minimize any potential fiduciary liability.

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HEL and family situation can dictate what benefits your employees will value. But don’t just look at your current employee makeup; track how employee demographics have been changing and take those trends into consideration.

IMPROVE COMMUNICATIONS WITH EMPLOYEES Employee turnover is expensive, disrupts the workflow and can negatively impact morale. One way to help reduce employee turnover is to improve communications with your employees, especially when it comes to your benefit plan offerings.

You’re likely required to send annual updates to employees about their retirement plan, but how many other times during the year are you reaching out? It’s possible, if not likely, that many of your workers are unaware of the benefits available to them. Remind your workers what benefits they have at their disposal and help them sign up for those programs if they need assistance.

This advertising-supported section/feature is produced by Crain’s Content Studio-Cleveland, the marketing storytelling arm of Crain’s Cleveland Business. The Crain’s Cleveland Business newsroom is not involved in creating Crain’s Content Studio content.

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Employee benefits Enticing employees with a holistic benefits package Employers who offer robust benefits packages may have the upper hand in attracting and retaining top talent in today’s tight labor market.

While good pay, health care and retirement plans remain among the most desirable benefits offerings, employers also are paying more attention to supporting employees’ needs with programs that address physical, mental and financial well-being. Here is a look at some of those offerings:

THE FUTURE IS NOW A large share of the current workforce (82%) expect their workplacedefined contribution retirement plan to be an income stream during retirement. So far, current workers are happy with their workplace retirement savings plans, with more than four in five workers satisfied with their benefits, according to Employee Benefit Research Institute’s 2022 Retirement Confidence Survey.

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ost employers are feeling the squeeze of the tight and transitory labor market.

Employers must provide high-quality benefit programs to attract and retain employees, but benefits such as health and disability insurance and 401(k) retirement plans are expected offerings. So how does an employer differentiate to attract and retain a productive workforce? Well-being programs are key.

A well-being strategy must become a part of company culture to bring about the best physical, mental and financial health outcomes, as well as create an environment of personal and professional growth.

PHYSICAL HEALTH

HIGH PRIORITIES Boosting access to virtual health care and adding or expanding behavioral health programs rank among the top health program trends of the business environment in 2022, according to Mercer’s National Survey of Employer-Sponsored Health Plans. For several years, virtual health care access helped address a utilization stagnation of about 9%.

Utilization jumped to 15% in 2020 and held at 12% during the first half of 2021. Meanwhile, behavioral health benefits ranked among the top-three priorities for employers with 500 or more employees, and the top priority for companies with 20,000 or more employees.

MONEY TALKS Personalized financial counseling, coaching, basic planning and money management tools represent some of the most commonly offered and popular benefits that companies plan to offer in 2022 to support employees’ financial well-being, according to EBRI’s 2021 Financial Wellbeing Employer Survey. Challenges to the implementation of new benefits programs include costs to both the employer and employee, along with data and privacy concerns.

HELP FOR CAREGIVERS The pandemic exacerbated the burdens and stress of working family caregivers. About 66% of caregivers were worried about juggling responsibilities in the next 12 months, according to an AARP “Working Caregivers’ Concerns and Desires in a Post-Pandemic Workplace” survey published in August 2021. More than half of working caregivers said their employers implemented new benefits due to the pandemic, including flexible schedules and remote work opportunities.

REDEFINING THE APPROACH TO EMPLOYEE HEALTH Approximately 80% of employees use few medical services in a year, yet American workers are less healthy than counterparts in other countries, according to a 2021 McKinsey & Co. article titled, “Innovating employee health: time to break the mold?” Incorporating benefits that support preventive health and well-being will help improve employees’ overall health and productivity. The article also suggests that employers should view health as an investment, not an expense.

SOURCES: AARP, Employee Benefit Research Institute, Mercer, McKinsey & Co. Compiled by Kathy Ames Carr, Crain’s Content Studio - Cleveland

of ent.

Building benefit packages around employee wellness

Health improvement and wellness programs mitigate health care costs and foster a healthy and happy employee. In order to improve the overall physical health of employees, we must first identify the prevalent problems in a population. These patterns are identified through claims analysis and on-site diagnostic testing. This analysis gives us the data to identify prevalent conditions or trends and then develop programs to treat them. Employers can then implement specialty wellness programs to address specific issues. Some of the most common issues to address today are orthopedic, diabetes and digestive health.

Employers must also design programs to encourage engagement with a primary care physician (PCP). A relationship with a PCP is the linchpin to overall better health. Employers should consider creating an incentive for employees to engage their PCP or provide access to a PCP at the worksite. For those with chronic conditions, the PCP can

EMPLOYEES WANT EMPLOYERS TO UNDERSTAND THEIR CHALLENGES AND OFFER TOOLS TO SOLVE THEM. diagnose, treat and coordinate care for better health outcomes and better quality of life. For those without chronic conditions, the PCP can keep them healthy through regular preventive care.

Unfortunately, not nearly enough of our population utilizes annual preventive screenings even though these services are 100% covered on health plans.

MENTAL HEALTH Employee Assistance Programs (EAPs) provide support for mental health, personal or workplace relationship problems and childcare and eldercare challenges. The pandemic brought out an unprecedented amount of mental health

DAVID LESZCZ Senior vice president, Corporate Benefits, NFP dave.leszcz@nfp.com 216-264-2725 David is a senior vice president of Corporate Benefits at NFP in Cleveland.

NFP is a leading insurance broker and consultant providing specialized property and casualty, corporate benefits, retirement and individual solutions. In his role, David works with companies to help manage the complex process of mitigating health care costs while providing benefits that attract and retain top talent. He has more than two decades of experience in benefits consulting and has worked with companies of all sizes in a large variety of industries throughout his career.

issues and need for support. EAPs went from seldom-used programs to branded, full-service programs that provide employees telephonic, texting or on-site access, allowing them to get support wherever they are. A strong EAP provides a confidential resource to address mental health and personal issues so employees can come to work focused on being productive.

FINANCIAL WELLNESS The majority of Americans live paycheck to paycheck and struggle to manage their finances. Financial wellness tools are a low-cost supplement to an employer-sponsored retirement plan and can help employees manage their overall finances. Additional programs available at low or no cost to the employer are student loan debt management and loan programs that provide employees access to low interest loans that are repaid through payroll deductions — at no risk to the employer.

HEALTHY CULTURE, HAPPY EMPLOYEES Employees want employers to understand their challenges and offer tools to solve them. Physical, mental and financial wellness programs are practical ways to set employees up for success. By building well-being into benefits, employers show that employees are valued on a personal level, bolstering attraction and retention.

This advertising-supported section/feature is produced by Crain’s Content Studio-Cleveland, the marketing storytelling arm of Crain’s Cleveland Business. The Crain’s Cleveland Business newsroom is not involved in creating Crain’s Content Studio content.

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Employees crave options, benefit variety and reliable coverage It’s no secret that health insurance is a driving factor behind many of the major career decisions that working Americans make every day.

Particularly now, in the post-COVID era, the modern workforce is especially health conscious. This adds up to one takeaway: employees expect to be well taken care of by their employers, meaning robust health benefit offerings that treat each policy holder as an individual are an absolute necessity.

According to the Society for Human Resource Management (SHRM), 56% of U.S. adults with employer-sponsored insurance plans consider the quality of their health coverage a key factor in deciding whether to remain in their position. Additionally, 46% of respondents said that their health insurance was either the deciding factor or an influence on their decision to take their current job.

While group plans that offer “blanket” coverage to entire workforces has long been the standard for employee-provided benefits, a newer, more individualized option has been catching on in the form of individual coverage health reimbursement arrangements (ICHRA).

WHAT IS ICHRA? An ICHRA is an IRS-approved health benefit plan under which employers can reimburse their employees for premiums and other qualifying out-of-pocket expenses. This reimbursement of out-of-pocket employee health care spending is not taxed, allowing employers to control their costs while only requiring employees to pay for medical services they actually use. In fact, in a survey quoted by PeopleKeep.com, almost 70% of respondents said they felt the ICHRA model was more flexible than traditional group health insurance options.

ICHRAs continue to serve many with individualized insurance options

W

hen I first wrote about the topic of ICHRAs (individual coverage health reimbursement accounts) in a February 2020 issue of Crain’s, I closed with the question; “Is ICHRA a health insurance game changer?” More than two years later, and after analyzing hundreds of cases and enrolling thousands of employees − through the challenges of a pandemic no less − the answer is yes, it has changed the way employers can tailor health insurance for individual employees.

ICHRAs, often referred to as the 401(k) of health insurance, first became available on January 1, 2020, through a collaborative regulatory initiative by the Departments of Labor, Treasury, Health and Human Services and the Centers for Medicare and Medicaid Services designed to increase the number of insured individuals through the expanded use of health reimbursement arrangements. In short, the ICHRA regulation allows a company to, on a pre-tax basis, define a monthly contribution for each benefit-eligible employee to select a plan through the individual health insurance marketplace that best fits their needs.

We have learned over the past 28 months that ICHRAs can be mutually beneficial to both employers and their employees.

FRANK SPINELLI Managing director, InsureOne Benefits, Inc., an Oswald Company fspinelli@oswaldcompanies.com 330-662-0585 Frank Spinelli is the managing director at InsureOne Benefits, a Unison Risk Advisors company. He has more than 30 years of experience in management and business ownership. Prior to leading InsureOne as of January 2021, Frank led the Affinity Group & Emerging Market book of business at Oswald Companies. In addition to extensive product and carrier knowledge, his benefits expertise has included development of integrated health management strategies comprised of extensive use of consumer driven plans and innovations like the ezICHRA platform.

BENEFITS FOR AN EMPLOYER

PROVIDING EASY ACCESS TO CARE Similarities between ICHRA models and health savings accounts (HSAs) are easy to draw, and indeed the two systems share several benefits. One particularly appealing similarity is how both models make it easier for employees to participate in their employer-provided insurance programs. Creating a reimbursement account typically involves a few steps and little more time commitment than applying for a bank account.

INSURING THE INDIVIDUAL, NOT THE COMPANY It’s clear to the business world that one-size-fits-all health care plans no longer meet employee expectations. Different backgrounds, different lifestyles and other factors can make for sizeable disparities in what individual employees expect from employer-sponsored benefits packages. With an ICHRA, employers can more easily offer employees a chance to choose the health care services and perks that mean the most to them.

ICHRAs are: • Budget friendly – more predictable costs, less volatile than traditional group insurance • Easier to renew – no need to shop, negotiate and select next year’s group health plan • Free of minimum employee participation requirements • Flexible to design – classes can be created based on needs and locations of employee population • Fully compliant with all ACA mandates and can be designed to avoid all risk of ACA penalties The typical annual savings to our clients who have adopted this new method is 15% to 30% compared to group health costs, before renewal increase.

BENEFITS FOR AN EMPLOYEE FLEXIBILITY IS KING Beyond the specific characteristics of ICHRAs, health reimbursement agreements in general have the broad appeal of allowing employers and employees to establish a system in which individual health insurance premiums incurred by the employee can be reimbursed on an as-needed basis. This way, both parties can flexibily meet a variety of individual health needs while keeping costs down and maintaining the tax-favored status of employer health plan contributions.

Sources: Society for Human Resource Management, PeopleKeep, JP Griffin Group, Centers for Medicare & Medicaid services Compiled by Conner Howard, Crain’s Content Studio - Cleveland

ICHRAs allow employees to: • Select a plan that fits their own needs – from deductibles to doctors, employees decide what’s right for them • Select a plan that fits their monthly budget • Continue to benefit from the tax advantages they have through traditional group health insurance • Keep their plan – the individual policy is portable when they retire or change jobs We’ve seen employees contribute an average of 12% less monthly toward their health insurance compared to their

previous traditional group health plan – 31% purchase bronze level plans, 21% purchase silver level plans and 48% purchase gold level plans in the individual marketplace.

WHAT EMPLOYERS SHOULD KNOW While the benefits of an ICHRA are numerous for both employers and employees, ICHRAs aren’t a fit for all organizations. This new method of providing health insurance is a significant change for all involved and it must fit both financially and culturally. Employers need to ensure their ICHRA is established in a compliant way to eliminate any risk of exposure while also adapting to a new way of thinking, as the administration of an ICHRA is quite different from a group health plan. Just like with group health plans, employees need education, communication and assistance to help them adjust to a new and more proactive engagement in the enrollment process.

In the final ICHRA regulation, it was estimated that within the next five years, more than 800,000 organizations will offer an ICHRA – insuring more than 11 million employees and dependents. From what we are witnessing, that forecast seems to be on-point. What’s next for ICHRA? Per the projections, we see continued growth and further progress for those who seek to control their health care spend while offering expanded and personalized options to their employees.

This advertising-supported section/feature is produced by Crain’s Content Studio-Cleveland, the marketing storytelling arm of Crain’s Cleveland Business. The Crain’s Cleveland Business newsroom is not involved in creating Crain’s Content Studio content.

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Crafting appealing plans that address workforce dynamics The pandemic’s disruption of employees’ personal and professional lives has prompted employers to refocus their benefits offerings according to new work-life integration needs while keeping their benefits costs in check. The following trends are among those guiding employers to reframe benefits plans and create a more competitive workforce advantage.

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RISING HEALTH CARE BENEFITS COSTS According to Mercer’s 2021 Annual Survey of Employer-Sponsored Plans, health benefits costs increased 6.3% in 2021. The jump was attributed to higher plan utilization, or “catch-up care,” COVID claims, high-cost drug therapies and inflation of health care. The survey expected a more typical increase of 4.4% in 2022.

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That same survey found that smaller employers experienced the highest cost growth in 2021, with an average increase of 6.3%, followed by a 9.6% increase among employers with 50-500 employees and a 5% increase among employers with 500 or more employees.

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Employers became more concerned about their employees’ financial well-being in 2021. On a 10-point scale, with 10 being the highest, about 34% of employers rated their concern level at a 9 or 10, which edged up one-quarter from previous years, according to Employee Benefit Research Institute’s 2021 Financial Wellbeing Employer Survey. Companies have offered different incentives to help address employee financial stresses brought on by the pandemic, including allowing employees to access third-party emergency funds or short-term loans through payroll deductions.

BENEFITS MATTER A 2021 survey of 9,600 U.S. employers at large and midsize companies revealed that while pay remains the most compelling reason on whether to stay or leave a company, health and retirement benefits matter in career decision-making. In fact, an increasing share of employees surveyed in WTW’s 2022 Global Benefits Attitudes Survey would be willing to pay more for their benefits. About 59% of employees would pay more for better retirement benefits, an increase of 9.3% in 2020, while 46% would forego a pay increase for a more generous plan, an increase of 28% in 2020.

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A DYNAMIC BENEFITS LANDSCAPE U.S. employers are working through decisions of whether to require employees to return to the office or continue to allow for a flexible hybrid model that enables remote and onsite work. The recent surge in gas prices has thrown another wrench into the dilemma; however, this challenge presents employers an opportunity to differentiate themselves with more diversified benefits offerings that help attract and retain employees. Employers that have offered to help with some form of gas price aid have taken a variety of approaches, including permitting flexible work schedules and allowing for telecommuting, according to the Society for Human Resource Management.

SOURCES: Employee Benefit Research Institute, Mercer, Society for Human Resource Management Compiled by Kathy Ames Carr, Crain’s Content Studio - Cleveland

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Aligning incentives for a healthier, cost-effective benefits plan

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f there’s one thing that employers and their employees have in common right now, it’s the deep acknowledgement that the only thing constant is change. What else can the universe throw at us?

And yet we persist. Thank goodness for all of the innovators, problem-solvers, and creators out there. It’s reassuring to witness the ingenuity and determination to keep living and working in the most connected way possible while doing all we can to stay healthy.

Most employers want to give their employees great health care benefits simply because they care. But now, it is also a matter of survival. Attractive benefits are required to recruit and retain A-players in this competitive labor market. But with the cost of employersponsored health benefits higher than ever, this noble objective becomes even more complicated. According to the 2021 Kaiser Family Foundation’s annual report, average annual health insurance premiums are $7,739 for single coverage and $22,221 for family coverage – a 54% increase over the past 10 years. It’s even worse for employees who saw a 71% increase in their premium contributions.

As a result, household income has actually declined over the past 10 years.

And now we’re seeing the impact of inflation. No wonder employees feel more stressed about their finances.

So what can a caring employer do? The key is alignment. When you want to right a turbulent situation, it helps to have everyone rowing in the same direction.

When employers and employees are working together to be smarter health care consumers, when employees are less passive and more active, when there is a “why” behind the health plan design and everyone understands it – only then can you start to take control of your health care spend and change the trend.

Alignment and control go hand in hand.

To allow alignment to happen, you must have a health insurance solution that gives you control. Control requires access to data for insights on claims spending

MICHAEL A. SCHROEDER Founder and president, Roundstone mschroeder@roundstoneinsurance.com 440-617-0333 Since 2005, Michael A. Schroeder has served as president of Roundstone, a health insurance company specializing in self-funded medical group captive solutions. Mike offers more than 25 years of management experience and has a track record of building and leading fast-growing, innovative insurance businesses. He founded Roundstone with a mission of giving small and mid-size businesses a proven strategy for affordable, quality health insurance to attract and retain the best employees. Roundstone’s unique approach delivers high-quality care, mitigates risk, reduces claims volatility, controls costs, and returns savings right back to employers and employees. Roundstone is headquartered in Lakewood.

change. During the peak of the pandemic, for example, many companies that were self-funded were able to easily shift to digital solutions and adjust their plans as they needed. Most importantly, they were able to pocket the unspent premiums from the lower utilization of health care services, whereas those with fixed cost insurance products got nothing in return.

THE BEST WAY TO BEAT THE OVER-COMPLICATED HEALTH CARE SYSTEM IS FOR EMPLOYERS AND EMPLOYEES TO UNITE AS HEALTH PLAN STAKEHOLDERS WITH A MUTUAL DESIRE FOR QUALITY, AFFORDABLE HEALTH CARE FOR ALL.

Alignment and savings also go hand in hand. Employers can implement wellbeing programs and back them up with incentives for employees to participate.

Whether it’s a bonus to get a vaccine, a discount on employee contribution for visiting a primary care doctor, bio-metric screenings or rewards for participating in activities like corporate challenges, savings from a healthier lifestyle should benefit both the company and the employee. It’s essential that you link these programs to your “why” and strive to make health and well-being a core value integrated into the workplace culture.

that allow for proactive cost management solutions. Control delivers flexibility in plan design that suits your employee needs, and allows you to be agile and responsive, not stuck with a plan you can’t

The best way to beat the over-complicated and dysfunctional health care system is for employers and employees to unite as health plan stakeholders with a mutual desire for quality, affordable health care for all. Align and win.

This advertising-supported section/feature is produced by Crain’s Content Studio-Cleveland, the marketing storytelling arm of Crain’s Cleveland Business. The Crain’s Cleveland Business newsroom is not involved in creating Crain’s Content Studio content.

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CRAIN'S LIST | LARGEST HOME SALES OF 2021 Ranked by price RANK

1 2 3 4 5 6 7 8 9 9 11 12 13 14 15 16 17 18 19 19 21 22 23 24 24 24 27 27 27 27 31 32

ADDRESS

SALE PRICE

BUYER

SELLER

SQUARE FEET YEAR BUILT

12407 LAKE SHORE BLVD. Bratenahl, 44108

$5,300,000

Michael D. Trebilcock, through Sagebrush Properties LLC

Trenton Wynter Brown (trustee), through Terwyn Properties LLC 1

3465 ROUNDWOOD ROAD Hunting Valley, 44022

$3,950,000

3465 Roundwood LLC

21916 AVALON DRIVE Rocky River, 44116

$3,800,000

19700 FRAZIER DRIVE Rocky River, 44116

SALE DATE

COUNTY

15,677 1907

Nov. 23, 2021

Cuyahoga

Suzanne Tomsich

13,201 1960

Nov. 17, 2021

Cuyahoga

Michelle L. Reef, through 339 Northcliff LLC

Bradley C. and Carol L. Richardson

6,096 2011

Dec. 10, 2021

Cuyahoga

$3,200,000

Brett and Andrea Wall

Kristin D. Mylett

5,230 2005

June 15, 2021

Cuyahoga

14 COLONY LANE Bratenahl, 44108

$2,850,000

Kevin M. Connor, through Barracuda Colony LLC 2

Craig S. Shular

8,078 2000

Oct. 4, 2021

Cuyahoga

2650 HERITAGE LANE Pepper Pike, 44124

$2,650,000

Alec Scheiner, through 2650 Heritage Lane LLC 3

Ansir Junaid

8,916 2013

Oct. 1, 2021

Cuyahoga

34115 FAIRMOUNT BLVD. Hunting Valley, 44022

$2,600,000

34115 Fairmount LLC

Delos and Anita Cosgrove

7,548 1920

July 29, 2021

Cuyahoga

3939 BRUSH ROAD Richfield, 44286

$2,535,000

Glenn Dewitt Counsil

Sgro S. Shana

5,866 1997

Dec. 14, 2021

Summit

120 LAKEHURST DRIVE Bratenahl, 44108

$2,500,000

120 Lakehurst Zke LLC

Tristan T. Thompson

8,914 2008

April 30, 2021

Cuyahoga

495 N. MAIN ST. Chagrin Falls Twp, 44022

$2,500,000

Matthew D. and Molly E. Cain

Alice and Walter Hoyt Jr.

4,950 1994

Dec. 2, 2021

Cuyahoga

332 TIMBERIDGE TRAIL Gates Mills, 44040

$2,320,620

Jonathan and Caitly Conklin

Lorelei Stein-Sapir

13,384 1986

Oct. 19, 2021

Cuyahoga

45 ADDISON LANE Moreland Hills, 44022

$2,282,500

Neil Deepak Vaidya (trustee)

Jerald D. O'Dwyer

5,104 2019

Jan. 15, 2021

Cuyahoga

2678 EATON ROAD Shaker Heights, 44118

$2,250,000

Matthew C. Brannan

Conor and Clare Delaney

7,441 1929

Oct. 14, 2021

Cuyahoga

31780 LAKE ROAD Avon Lake, 44012

$2,220,000

Nicholas B. Noyes and Noelle K. Sayles

Jon L. and Nancy L. Gorney

8,490 2001

Sept. 15, 2021

Lorain

32600 FAIRMOUNT BLVD. Pepper Pike, 44124

$2,200,000

Kevin Michael Peart (trustee)

Jacqueline Van Auken Akins

5,810 2014

Sept. 15, 2021

Cuyahoga

70 HUNTING TRAIL Moreland Hills, 44022

$2,197,500

John M. (Jr.) and Karah H. Parschauer David F. Haines (trustees)

7,861 2009

Jan. 13, 2021

Cuyahoga

19420 FRAZIER DRIVE Rocky River, 44116

$2,150,000

Christiaan and Sarah C. Van Raalten

Alexander W. Schultz and Gregory Elinsky (successor trustees)

3,552 1925

June 15, 2021

Cuyahoga

457 AVERY LANE Medina, 44256

$2,148,750

Ricardo and Sandra Estok

GMA Development LLC

7,177 2019

Nov. 5, 2021

Medina

15553 HALLAUER ROAD Oberlin, 44074

$2,100,000

Holly R. and Jason L. Smith (trustees) Jason VanWingerden

5,397 2017

Feb. 4, 2021

Lorain

37150 BROADSTONE DRIVE Solon, 44139

$2,100,000

Brian H. and Laura Eby

Kimberly Ann and Heath B. Monesmith

5,117 2013

Dec. 16, 2021

Cuyahoga

660 CHAGRIN RIVER ROAD Gates Mills, 44040

$1,975,000

Timothy S. and Brittany S. Pinkerton

Chagrin Rivers Bend Farm LLC

6,583 1950

Nov. 15, 2021

Cuyahoga

2510 BLOSSOM LANE Beachwood, 44122

$1,925,000

Joseph Kanfer (trustee)

Shayne Grunspan Krichevsky (trustee)

6,762 1988

July 8, 2021

Cuyahoga

7341 WHARTON ROAD Novelty, 44072

$1,887,500

Erika R. Arslanian and David M. Roth

Larry Dean and Sarah J. Madden

6,973 1986

Sept. 20, 2021

Geauga

11 COLONY LANE Bratenahl, 44108

$1,850,000

Michael Scott and Dinah Kolesar

Beth E. Mooney

4,044 1997

July 27, 2021

Cuyahoga

15300 SUFFOLK LANE Chagrin Falls, 44022

$1,850,000

Kelley and Kevin Conway

Randi K. Gottlieb

11,312 1997

May 28, 2021

Geauga

2879 SOUREK ROAD Akron, 44333

$1,850,000

Laszlo G. and Kyra B. Kulin

Mark S. and Michele E. Allio

10,297 2001

March 17, 2021

Summit

14000 COUNTY LINE ROAD Chagrin Falls, 44022

$1,800,000

Richard A. and Ellen B. Schmidt

Lisa M. Reed

5,585 1919

Nov. 18, 2021

Geauga

3482 ROUNDWOOD ROAD Hunting Valley, 44022

$1,800,000

Nathan Lancry

Robert L. Norton

5,003 1950

March 19, 2021

Cuyahoga

424 RIDGEWOOD ROAD Wadsworth, 44281

$1,800,000

Forest Glen Development of Medina

Prestige Woods Inc.

2,330 1998

Oct. 8, 2021

Medina

RAEA LANE Moreland Hills, 44022

$1,800,000

Daniel Pyle and Lauren Hylan Kroh

Wendi B. and Ervin J. Pavlofsky

4,988 2017

Feb. 28, 2021

Cuyahoga

7000 E. NORVALE CIRCLE Gates Mills, 44040

$1,788,000

Paulo Ruiz Sternadt and Ana Luiza Soares Teixeira

Daniel K. and Laura K. Baker

9,033 1987

May 5, 2021

Cuyahoga

29930 BOLINGBROOK ROAD Pepper Pike, 44124

$1,775,000

Kara Rae Mahoney and Michael F. Hester

Glenn C. Pollack

5,799 1957

Sept. 23, 2021

Cuyahoga

Research by Chuck Soder (csoder@crain.com) | This full digital list includes individual home sales over $1 million for Cuyahoga, Summit, Geauga, Lake, Lorain, Portage and Medina counties. Data is from county records. The list excludes vacant

land sales, sheriff's sales and non-arms-length transactions (sales categorized as "not valid"). NOTES: 1. Brown is trustee of Trenton Wynter Brown Revocable Trust, which owns the LLC, according to a deed documenting this transfer. 2. Connor is listed as president of the LLC on a mortgage related to the property. 3. Scheiner is listed as manager of the LLC on a mortgage related to the property.

To get all 175 homes sales on this list in Excel format, become a Data Member: CrainsCleveland.com/data 18 | CRAIN’S CLEVELAND BUSINESS | MAY 16, 2022

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LIST ANALYSIS

Pricey home sales exploded in 2021; 2022 looks even better

BY CHUCK SODER

Our list ranking Northeast Ohio’s largest home sales got waaaaay longer this year.

The full digital version of this year’s list includes 175 homes that sold for at least $1 million in 2021, a 56% increase from 2020. And that’s saying something. The number of 2020 sales above $1 million had already increased by 23% over 2019, despite a slow spring caused by the onset of the COVID-19 pandemic.

Thus, as you’d expect, homes in the top 10 are particularly pricey this year, including the home at No. 1. In November 2021, the Gwinn Mansion in Bratenahl was sold for $5.3 million to Michael D. Trebilcock, the founder and chairman of Cleveland IT services firm MCPc. The mansion was built in 1907 by William Gwinn Mather, who served as president of Cleveland-Cliffs Iron Co. for nearly 40 years and has a steamship named after him floating off the shore of downtown Cleveland. One might guess the home was owned by a famous industrialist judging by the exterior, with its Greek pillars, winding stairways, statues and direct access to Lake Erie.

The total value of the top 10 homes on the list, which is based on data from Cuyahoga County and all adjacent counties, rose by 20% compared with the top 10 on last year’s list.

So far, 2022 has been even better,

SOLD! The number of Northeast Ohio homes sold for at least $1 million has been rising for years but really took off in 2021.

160 140 120 100 80 60 40 20 2017

2018

2019

2020

2021

SOURCE: CRAIN’S LARGEST HOME SALES LISTS, BUILT WITH DATA FROM CUYAHOGA AND ADJACENT COUNTIES.

according to Adam Kaufman, a local real estate agent with Howard Hanna Real Estate Services.

He counts 74 homes in the sevencounty area that sold for at least $1 million as of May 11 and 62 others that are pending. If all pending sales close (he says the vast majority probably will), that would be 136 sales.

“That’s amazing,” Kaufman said.

Last year was great, but now buyers are competing even more for homes, said Kim Crane, who leads Howard Hanna’s Kim Crane Real Estate Group.

They’re waiving inspections, skipping appraisals and going well over asking prices — sometimes $100,000 over, she said.

“The past six months it’s really gone next-level,” she said.

Why are so many homes selling for such high prices?

Demand got a boost from low interest rates, and the pandemic forced people to spend more time at home, thinking about things like better kitchens, Crane said.

But Cleveland still isn’t California or Florida, where price increases have been “astronomical,” Kaufman said.

Still, the 56% increase in homes sold for at least $1 million shows we’re pretty close to the national average: Nationwide, the number of homes sold for over $1 million rose 62% in 2021, according to the National Association of Realtors.

Chuck Soder: csoder@crain.com, (216) 771-5374, @ChuckSoder

Bratenahl’s Gwinn Mansion was the most expensive home sold in Greater Cleveland in 2021. It was built in 1907 by William G. Mather, who served as president of Cleveland-Cliffs Iron Co. for nearly four decades. | CHESTNUT HILL REALTY

Rocky River had two home sales in the top five in 2021, including this home at 21916 Avalon Drive. | SONNY LINDSEY/KIM CRANE REAL ESTATE GROUP, HOWARD HANNA

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MAY 16, 2022 | CRAIN’S CLEVELAND BUSINESS | 19

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HEALTH CARE

UH invests in STAQ and supply chain

BY LYDIA COUTRÉ

With backing from University Hospitals and other health systems, Denver-based STAQ Pharma is expanding into Ohio with a $60 million pharmaceutical facility in Columbus that UH leaders say will help strengthen its supply chain.

STAQ Pharma, a U.S. Food and Drug Administration-registered 503B outsourcing facility, produces sterile injectable medications compounded under the Current Good Manufacturing Practices (cGMP) standards of pharmaceutical production.

UH was among a group of health systems (with Froedtert Health, UNC Health and Burgess LCMC Health) that led STAQ Pharma’s Series C financing round, which closed in December 2021 and will support the construction of the 137,000-square-foot facility, on the west side of Columbus.

Neil Wyant — vice president of investments and commercialization at UH Bagan Ventures, the system’s commercialization arm — said the investment made sense operationally and financially.

“When we’re evaluating opportunities — STAQ and others — we put both lenses on,” Wyant said. “An invest-

ment’s got to be a good investment, but it also has to have some strategic implications for the system if we’re investing in an outside organization.”

STAQ’s Series C financing also included support from Rev1 Ventures, Nationwide Children’s Hospital and Cincinnati Children’s Hospital. Beyond the health systems that have invested, STAQ Pharma has other Ohio and Northeast Ohio customers, including Cleveland Clinic.

“STAQ Pharma’s commitment to producing a quality product and their attention to the pediatric community’s needs is in line with Nationwide Children’s focus of delivering innovative care and achieving best outcomes for young patients,” said Chet Kaczor, vice president of operations at Nationwide Children’s Hospital, in a provided statement. “STAQ is helping address a critical supply chain issue facing all hospitals.”

Dealing with shortages is “the nature of the pharmacy business,” but the problem worsened in the pandemic with supply chain challenges, staffing constraints at pharmaceutical companies, and increased utilization, especially during COVID surges, said Henry Burgess, chief pharmacy officer for UH.

STAQ Pharma is expanding into Ohio with a $60 million pharmaceutical facility in Columbus. | STAQ

“I’ve been in pharmacy leadership since 2009, and the past two years were the worst I have seen since I’ve been a pharmacist,” he said. “It’s really been something that we had not seen in the market previously.”

To mitigate shortages, UH has restricted use of certain products when clinically appropriate, requesting clinicians use alternative products where they can or only use it in certain situations, which makes providers’ jobs more difficult, Burgess said.

And the system faces high costs when buying drugs during shortages or from vendors they don’t have a contract with when they’re trying to source needed product.

UH leadership is seeking “as secure a supply chain as possible,” Wyant said. “Certainly, we on the investment side have become more attuned to look for those kinds of opportunities where we can help provide some risk reduction for the system.”

Burgess said UH will have the ability to have a preferred allocation because of their equity partnership, as well as participation on the company’s product development committee. The group, which will ultimately

advise for both of the company’s facilities, meets regularly to advise STAQ and share their current or potential product needs.

The committee currently has about 10 systems represented — a figure that STAQ Pharma CEO Joe Bagan said he plans to keep small.

“That’s the essential element of that meeting: come together, talk about what we need to do to help hospitals and then STAQ responds with what it can or cannot do,” Bagan said. “And then we get to work on trying to do it.”

When UH Ventures was first connected with the opportunity to invest in STAQ, health care system participation was a key part of that vision, Wyant said.

“They thought that would give them a strategic advantage in terms of understanding the market, and so far, that seems to have proven out,” he said.

UH Ventures anticipates either an exit or the company continuing to pay dividends to shareholders, either of which “we’re comfortable with, as investors,” Wyant said.

UH has a primary relationship with McKesson as its wholesaler, which is where it buys the majority of

its pharmaceuticals, Burgess said.

A small percentage of what the system purchases overall come from 503b facilities, he said. UH currently has contracts with 10 different 503B facilities, but intends to make STAQ its preferred partner for these type of compounding products.

Bagan said STAQ expects to produce its first drug product in the first quarter of 2023 at the Columbus facility, where STAQ plans to employ up to 300 people at full capacity.

Making STAQ a preferred partner would help UH avoid potential variability in product while simplifying supply chain and administrative work for its 503B purchasing, Burgess said.

“We’re hoping that with our relationship with STAQ, we’ll have the ability to protect ourselves from these shortage issues in the future, the ability to be proactive when we foresee shortages coming to the market,” he said. “And I think that’ll help us to be able to avoid the situation that we’ve experienced in the past two years in the pandemic.”

Lydia Coutré: lcoutre@crain.com, (216) 771-5479, @LydiaCoutre

REAL ESTATE

Forest City offshoot Rose Community Management flowers

BY STAN BULLARD

Rising housing costs and shortages are creating a moment for the affordable housing business nationally. An offshoot of the former federal housing business of Forest City Realty Trust is poised to continue the cause nationally from a national headquarters office in Independence.

The office was launched five years ago as Rose Community Management, with 45 staffers from Forest City. They were charged with continuing to operate the properties after New York City-based Jonathan Rose Cos. paid $500 million in 2017 for the 7,595-unit portfolio, which receives dedicated federal housing subsidies to help residents pay their rent.

Kevin McKee, president of Rose Community, said in a phone interview the company has expanded here over the past five years. The Independence staff now numbers 50 people, and the company recently expanded its Freedom Office Park suites. Moreover, the portfolio has grown through acquisitions and new developments, to 12,359 units.

“Forest City people are still here,” McKee said — and later, after checking, he said 18 Forest City alumni remain at the headquarters.

The field staff at the properties who answer to the Independence office has grown to 340 positions nationwide from 200 who joined Rose from Forest City in 2017.

“They’ve adapted well to the change in culture,” McKee said, referring to staffers joining a company formed with a mission to provide decent, safe, affordable housing from Forest City, which, at its height, engaged in shopping malls, office towers, apartments and land development for single-family homes between New York City and San Francisco.

Forest City Realty, the last vestige of Cleveland-born Forest City Enterprises Inc., was acquired by Toronto-based Brookfield Asset Management in 2018, its properties integrated with other holdings and its Key Tower headquarters closed.

Rose Community sold just two of the former Forest City federal housing communities, one in West Virginia and one in Kentucky. McKee said the properties were at the time outside the major-city-focused approach of the parent company.

Another element in Rose Community’s growth also has been absorbing, for property management purposes, other Jonathan Rose Cos. properties as prior long-term management contracts expire. The company’s namesake founder began developing affordable housing in 1989 and is a nationally known expert and author of multiple books on housing needs and planning.

One big change for the operation is how it funds its new developments and acquisitions. The bulk of its purchases are older apartment buildings

The first half of this 700-unit affordable housing community is open and construction of the rest is expected to start in spring 2022. | CONTRIBUTED

constructed and operated with support from federal housing funds, and they often require substantial updating.

A big difference in how Rose operates is in its financing. Where Forest City had access to corporate debt, Rose is a smaller player and must raise its own funds for expansion.

McKee said since its inception, Rose Community has raised five rounds of institutional funds, the latest a total of $525 million in 2020.

Such funds are supported by national foundations, pension funds and in-

surance companies.

That is a very different private equity game, compared with individual loans and corporate debt.

Mario Sinicariello, president of the Solon-based Vitalia chain of senior housing communities, said in a phone interview that the run-up in values of all apartment types is a challenge for all companies in the senior housing and affordable living space, and housing complexes are particularly prized because they receive a stable source of federal funds as a rent source. Many older affordable housing properties are focused on senior housing and, he said, need substantial updates.

Such fundraises require a lot of selling, he said.

“Rose has the benefit of a long track record and Forest City’s track record, which will help with institutional fundraising to raise equity for deals,” Sinicariello said.

For his part, McKee said that as older fundraising tranches reach maturity, many of Rose’s investors join a new fundraise.

A similar aspect of Rose’s undertakings and Forest City’s is the pursuit of sustainable real estate operations and environmentally friendly materials.

Among Rose’s most recent projects is what it considers a “passive house” that meets federal energy conservation requirements to reduce fossil fuel use at Sendero Verde, where the first 300 suites were offered in Harlem by lottery earlier this year. Another 400

remain to be developed in a massive complex that incorporates four towers and an elementary school.

A Cleveland firm with a big New York City project, albeit with two other real estate companies as partners, also recalls the vast operations of Forest City. In addition, Rose pursues transit-oriented projects, which Forest City also did, as McKee said that allows residents to use public transit to reach good jobs.

Each Rose property also has a resident services associate. He or she is devoted to meeting the needs of residents for everything from finding medical care to more schooling.

“The goal is to help those who wish to move up the (economic) chain through getting a better job or more education,” McKee said. “We call that our communities of opportunity philosophy.”

Since Rose pursues affordable housing opportunities in major cities, its projects require longer development times than market-rate projects. It’s constructing its first project in Atlanta and hopes to land a project in Chicago soon, he said, in a pipeline of about 2,500 units.

One thing won’t happen at Rose housing developments, McKee vowed.

“We will not convert these properties to market-rate from affordable units,” he said.

Stan Bullard: sbullard@crain.com, (216) 771-5228, @CrainRltywriter

20 | CRAIN’S CLEVELAND BUSINESS | MAY 16, 2022

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THE WEEK READ ALL ABOUT IT: A local developer bought the former Plain Dealer office building in the Superior Arts District, ending years of uncertainty about the future of a prominent piece of real estate at the eastern edge of downtown Cleveland. Industrial Commercial Properties LLC of Solon bought the property Wednesday, May 11. The sale does not appear yet in public records, and the buyer and a representative for the seller declined to disclose the price.

Built as the headquarters of The Plain Dealer newspaper, the 235,000-square-foot office building opened in 2001. It transitioned into a multi-tenant property as the media organization trimmed its staff, pared print delivery and retooled its business model to focus on the web. Now the building, at 1801 Superior Ave., is 80% vacant after the departures of tenants including Advance Ohio, the company that oversees Cleveland. com, and the newsroom that feeds the website and newspaper.

Pickleball is a hybrid of tennis, table tennis and badminton and is played by 4.8 million people nationwide, a number that has doubled in the past five years, according to research from the Sports & Fitness Industry Association. | MICHAEL JUREK PHOTOS

PICKLEBALL

From Page 1

While a lot of sports like to lay claim to the “fastest-growing sport in America” title — F1, esports, lacrosse, wondering why Generation Z is buying mom jeans, etc. — pickleball has a pretty solid case.

The sport, which actually dates to 1965, is a hybrid of tennis, table tennis and badminton. (Picture playing ping-pong on a tennis court, only with a wiffle ball.) Pickleball is played by 4.8 million people nationwide, a number that has doubled in the past five years, according to research from the Sports & Fitness Industry Association.

The game has competing pro leagues (the Professional Pickleball Association and the Association of Pickleball Professionals), a national governing body (the USA Pickleball Association), two magazines (InPickleball and Pickleball Magazine), broadcasting deals with CBS, Fox Sports and the Tennis Channel, and the lofty (but not insane) goal of becoming an Olympic sport in time for the 2028 Los Angeles Games. Pickleball even has A-list celebrity fans in George Clooney and Leonardo DiCaprio.

“It’s growing much more than tennis, and the tennis community knows that,” said Rick Warsinskey, who serves as one of four ambassadors for the sport on ClevelandPickleball.com. “Something happened during the pandemic where people just wanted to get outside, and pickleball just caught on. People kept saying, ‘What’s this pickleball I’m hearing about?’

“People love the game. It’s going up geometrically, rather than a straight line.”

Part of that is because of its accessibility — a paddle costs anywhere from $40 to $150, while an average ball is about $3 — and part of it is because it requires less practice, less space and — this is important — less running than tennis.

“It’s really easy to pick up on it, and I think that’s why we’re seeing so much growth,” said Jurek, who works as the director of finance for Human Ventures Capital. “The majority of players are most likely over

tribute to the severance pay for departing team members.”

NEW LOOK: The Cleveland-Cuyahoga County Port Authority plans to issue up to $20 million in bonds to support an extensive makeover of the Renaissance Cleveland Hotel. On Thursday, May 12, the agency’s board approved a deal in which the port will serve as a conduit between a Canadian hospitality company and a private lender. That structure will save the developer, Toronto-based Skyline Investments Inc., an estimated $2.1 million in sales taxes on construction materials. Skyline is partway into a nearly $70 million overhaul of the 491room hotel, the second-largest lodging property in downtown Cleveland. The publicly traded company, which owns the Renaissance through a 50-50 joint venture with a silent partner, already has spent about $14 million on a roof replacement, facade repairs, and heating, cooling and ventilation upgrades.

DOWNSHIFTING: Carvana Co. plans to lay off 2,500 employees, or $16M DEAL: Stark Enterprises of about 12% of its work force, accord- Cleveland shed its Brooklor Plaza ing to a document it filed Tuesday, shopping center in North Olmsted to May 10, with the U.S. Securities and an affiliate of Rubin Realty of Valley Exchange Commission. Those em- Stream, New York, in a $16 million ployees are primarily in Carvana’s transaction, according to Cuyahoga operations groups, the company County property records. Anchored said. In connection with those cuts, by Golf Galaxy, T.J. Maxx and Officethe online used-vehicle retailer said Max, the center dates from 1962 and it will “transition operations away” has almost 107,000 square feet of from a few of its logistics hubs and selling space, according to CoStar, from its inspection and recondition- the online realty data provider. It sits ing center in Euclid. Carvana said its on 7 acres on the opposite side of executive team will forgo their sala- Brookpark Road from Great Northries for the rest of 2022 “to help con- ern Mall and Great Northern Plazas.

C R A I N ’ S C L E V E L A N D B U S I N E S S | S E P T E M B E R 3 - 9 , 2 018 | PA G E 2 9

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CLASSIFIEDS To place your listing in Crain’s Cleveland Classifieds, Michael Jurek, left, and his wife Madeline are the founders of ClevelandPickleball.com, which helps players find courts, tournaments and leagues in the Cleveland area.

45, but the younger demographic is starting to pick up on it, and that’s really exciting to see.

“Just the name alone is a conversation-starter. I know some people feel like it’s just a trend, but I think it’s more than a trend. I think it’s definitely a sport that’s going to be here for a long time.”

Warsinskey, who spent 43 years working as a Social Security Administration manager in downtown Cleveland, discovered pickleball in 2019 while staying at his condo in Naples, Florida. The city is a pickleball hotbed, offering 60 courts within a five-minute drive of Warsinkey’s condo. He returned to Cleveland as a pickleball missionary, assembling a list of Cleveland-area sites that offered courts while gaining a reputation as the local authority on where to find, say, an indoor doubles game for players with an intermediate skill level near Rocky River.

He has compiled a list of more than 50 places between Cleveland and Dover offering indoor and courts that are either pickleball-specific or taped-off tennis courts.

As of late April, his email newsletter had 546 subscribers and is growing, well, geometrically.

“My biggest challenge right now is how to get courts in Cleveland,”

he said. “Especially the downtown area, but anywhere in the city of Cleveland would be nice.”

Maybe the biggest sign of the sport’s growth is the fact that you can win good money playing it. The PPA Tour expects to pay out more than $3 million in tournament prize money in 2022. Locally, the recent Cleveland Pickleball Classic in Mentor had a $5,000 payout, and the Western Reserve Racquet and Fitness Club in Streetsboro paid out $8,000 at the Pickleball Moneyball Shootout.

ClevelandPickleball.com, meanwhile, is promoting the second annual Cleveland Pickleball Classic, scheduled for July 16 at Bleser Park in Avon Lake.

It’s part of the site’s larger mission to grow the sport in Cleveland, something Jurek and Warsinskey do as a service, not a job.

(They relish it, you might say.)

“I don’t make a cent from this; I just do it,” Warsinskey said. “I met a need that was there. I love pickleball, I love talking to people about it and it’s my job as an ambassador to get people hooked up so they can play.”

Joe Scalzo: joe.scalzo@crain.com, (216) 771-5256, @JoeScalzo01

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CRA

with the nonprofit Western Reserve Land Conservancy. “Whereas the Trump administration had proposed rules that would weaken CRA, the Biden administration is working to modernize and strengthen it.”

think qualify and targets they shoot for.

But really, it depends on the exam team that shows up whether they give credit to a certain project that was funded three years ago.”

Also built into the new rules is an annual comment period that will provide an opportunity for banks or interest Changes proposed groups to critique existing rules or A framework for updating the CRA weigh in on what activities should or was released May 5 by the Federal shouldn’t count in a CRA exam.

A lot has changed in financial serReserve, the Federal Deposit Insurance Corp. and the Office of the vices since the act’s last overhaul. That includes the rise in digital banking Comptroller of the Currency.

A comment period on proposed that’s helped fuel the industrywide changes remains in effect now culling of brick-and-mortar branches through Aug. 5. Regulators will pub- amid shifting consumer preferences. lish official changes after that. It Branches historically have played a key could be a year or two before any new role in CRA exams with credit given for branches in LMI areas. rules actually go into effect.

Also among “CRA WAS SUPPOSED TO BE A TRIPWIRE SO proposed CRA changes is a new WHEN BANKS MERGE OR CLOSE way of calculatBRANCHES, THERE IS TO BE A DISCUSSION ing where deposare collected.

ABOUT HOW THEY INVEST DOLLARS IN LMI its This aims to account for one of AREAS. BUT IN 15 YEARS, THERE HAS the major differNEVER BEEN A SINGLE HEARING.” ences with tech-enabled, — Charles Bromley, director of the Ohio Fair Lending Coalition mobile banking.

That is someAt this point, interested parties are thing Kleymeyer said banks will be apstill largely digesting the nearly 700- prehensive about.

“It does seem like there will be some page CRA document.

Nonetheless, one of the biggest pro- significant data collection requireposed changes welcomed by banks ments out there that I believe will be will be additional clarity on how CRA very different for member institutions exams, which typically take place on a to comply with,” he said. “A lot of it has to do with geocoding.” three-year lookback, are conducted.

The most in-depth reporting will “One of the biggest struggles our members have always had around seemingly be required of financial inCRA is it is the only test they have that is stitutions with $10 billion or more in completely subjective,” said Evan Kley- assets. Banks closest to that $10 billion meyer, spokesman for the Ohio Bank- size — or that may have just crossed ers League. “They’ll have things they over that threshold amid the influx of

From Page 1

Despite the advent of the CRA, the effects of redlining seem to live on.

For instance, research by Cleveland State University’s Mark Salling, senior fellow and research associate in the Maxine Goodman Levin College of Urban Affairs, has shown that across Cuyahoga County, Black applicants — who tend to be most heavily concentrated in LMI neighborhoods — are denied home loans three times more often than white applicants.

Although a poor CRA rating can cause setbacks for banks involved with mergers or acquisition, failing a CRA exam is exceedingly rare. According to an analysis by S&P Global Market Intelligence, 99% of all banks in the U.S. had CRA ratings of either “outstanding” or “satisfactory” (versus “needs to improve” or “substantial noncompliance”) in 2019.

“CRA was supposed to be a tripwire so when banks merge or close branches, there is to be a discussion about how they invest dollars in LMI areas. But in 15 years, there has never been a single hearing,” Bromley said.

“The Cleveland Fed has never had a public hearing about a bank merger.

So it is a toothless act.”

New rules, though, might help change that.

Bolstering CRA is a different approach than what was considered by the previous presidential administration, which at one time looked at ways to gut the CRA. “My very preliminary understanding is that the proposed CRA rules are moving in the right direction,” said Frank Ford, senior policy adviser

deposits in the last couple years due to COVID-19 economic stimulus efforts — would be the ones most likely to struggle with implementing and financing the technological infrastructure they’d need to capture required data.

“We like that they are attempting to modernize CRA,” Kleymeyer said.

“But we do think some of this stuff around data collection is going to be fairly burdensome.”

Kevin Jacques, Boynton D. Murch chair in finance at Baldwin Wallace University and a former bank regulator, cautions that regulators may “impose some new costs on the system,” but there might not be as much benefit as it is hoped there could be.

In reality, he said, as clearer CRA rules are put in place, many institutions will simply look to do the bare minimum to meet those.

“I can guarantee no bank will admit this,” Jacques said, “but when you make rules clearer, or regulations become more transparent and you put in benchmarks, then what that regulated bank will do is say, OK, if benchmarks are A, B and C, how can I get around those? Banks will look to get around this as much as possible without having to change their behavior.”

As for other mortgage lenders, credit unions CRA does not presently apply to nonbank mortgage lenders or credit unions.

As new CRA rules are proposed, however, some see an opportunity to question that.

“We believe credit unions should not be subject to CRA requirements because they play a critical role in serving communities and helping banks

CROCKER PARK

meet obligations in underserved communities,” said Emily Leite, a lobbyist with the Ohio Credit Union League.

Leite notes that member-owned credit unions often sell loans in LMI areas to banks to help the latter meet their CRA goals. Subjecting credit unions to the same CRA rules, she said, would likely disrupt that dynamic.

Expanding CRA to credit unions and independent mortgage lenders would require a Congressional act changing definitions in the underlying law itself.

But some, like Bromley and Ford, say that should be an option on the table, especially as nonbank lenders in particular eat up market share once controlled by traditional banks.

Independent mortgage lenders accounted for more than 68.1% of all mortgages originated in 2020 compared to 58.9% in 2019, according to data from Inside Mortgage Finance.

And among the top-15 lenders in Cuyahoga County in 2020 for one-tofour family homes, nonbanks accounted for just more than half (51%) of all loans made and just less than half (48%) of all dollars lent out, according to WRLC research.

“I’m concerned about one segment of the lending industry regulated by CRA being required to make loans in underserved communities while the other segment is not and can focus on lending in more profitable areas of the housing market,” Ford said. “I don’t have any issue with holding banks accountable to meet credit needs in underserved communities. But to be fair, unless all mortgage lenders are held to the same standards, the CRA-covered lenders are at a competitive disadvantage.”

Jeremy Nobile: jnobile@crain.com, (216) 771-5362, @JeremyNobile

EDITORIAL

From Page 1

From Page 8

Sussman and Steve Rubin, chief operating officer of Five Forty Investments who is also the principal for Midwest Real Estate Partners, are serving as the developers of the project for Five Forty. The company is an investment arm for the Weiss family, best known for making American Greetings Corp. a global concern. Another Weiss affiliate owns the site.

Rubin said in an interview that plans for the complex are virtually the same as when he originally discussed them in 2019. The project encompasses two retail buildings, each about 15,000 square feet, and a U-shaped single-story office building. The office space is designed to serve as a buffer between the retail structures and an adjoining single-family neighborhood.

However, there are two big changes in the project that reflect what is hopefully a post-pandemic world.

On the north end of one of the retail buildings and on the south end of the other building there will be drive-up windows that will allow customers to pick up food from Shake Shack and Choolaah.

“They’re not drive-up restaurants,” Rubin stressed in an interview. “They are for pick-up and delivery. All the ordering and payment will be online. This allows the restaurants to continue to streamline operations.”

In a prepared statement, Kevin Moss, a CBRE vice president, wrote, “Despite many challenges with COVID, rising construction costs and inflation, CBRE was able to source new-to-market and expand-

It’s tempting to say the county should just sell the building, but market realities mean that’s not easy. A sale that makes sense requires a buyer who is willing to pay a price the county can live with, and who has a plan to turn the building into productive space. Experienced local brokers told Cleveland.com in April that a sale could “prove incredibly difficult,” given the weakness of demand for office space and the complexities of transforming that space for multiple tenants.

One thing that has been conspicuously lacking during the building’s lifespan is public input.

There’s a chance to fix that. We have a competitive race for Cuyahoga County Executive between two experienced people — Democrat Chris Ronayne and Republican Lee Weingart — and the fate of this key property can be part of this fall’s campaign to succeed Armond Budish. Weingart, for one, has floated the idea of an “expungement court” in the space, which doesn’t immediately strike us as a great use of the building, but it wouldn’t cost $46 million, either.

In the city of Cleveland, the transition of mayoral administrations has led to fresh staff thinking and policy creativity on a number of fronts. We’d like to see if a change at the county level could lead to similar innovation around the future of the Global Center building. That’s not as fast as backers of the renovation plan want, but we’d rather take some time to finally get this right. The building’s misguided past shouldn’t determine its future, but we shouldn’t repeat those blunders, either.

The first of two retail buildings is up at Crocker Commons, a mixed-use complex that is starting to come out of the ground on the opposite side of Crocker Road from the Crocker Park office, retail and residential project. | STAN BULLARD/CRAIN’S CLEVELAND BUSINESS

ing retailers and restaurants at this exciting new mixed-use development project. The developer and City of Westlake were creative and thoughtful about the current climate and were willing to work with Choolaah and Shake Shack to address their needs.”

Moss and Stephen Taylor, vice president at CBRE in Cleveland, both represented the developer in the project.

An element that might have been dropped, given uncertainty about future office demand postCOVID-19, but that has been retained, is the 60,000 square feet of office space in the project.

“We had no second thoughts about the offices,” Rubin said. “I think the market we expect to have

particular interest in the office space will need to be in the office.

That includes medical and health and wellness tenants and traditional neighborhood office tenants (such as lawyers and insurance agents), but we don’t want to limit it.”

Rubin said the office building will have direct entrances to office suites similar to those in office condos, although Crocker Commons offices will only be for rent. He likened the market for the suites to that in one-story office buildings to the project’s south, which are home to eye doctors, oral surgeons and financial planners.

Alex Jelepis, an expert in the Westlake office market and a director at the NAI Pleasant Valley bro-

kerage in Independence, said constructing offices with direct entrances to suites means the developer will not have to pay to build and operate lobbies or other amenities.

“I like it,” Jelepis said. “It’s a potential value proposition in a highrent office district.” Asking rents for offices are not yet set.

Rubin declined to estimate a total construction and development cost for the development.

However, ErieBank has provided an $18 million construction loan for the project, which means that total costs, including equity, are likely more than $20 million.

Stan Bullard: sbullard@crain.com, (216) 771-5228, @CrainRltywriter

22 | CRAIN’S CLEVELAND BUSINESS | MAY 16, 2022

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