Crain's Cleveland Business, October 16, 2023

CRAINSCLEVELAND.COM I OCTOBER 16, 2023

Preservationists make a pitch to revive Arcade They propose repositioning the historic downtown building as a cultural hub, with museums, merchants and ethnic foods MICHELLE JARBOE

By Michelle Jarboe

A group of local preservationists has a vision for filling vacant storefronts at the Arcade, an architectural marvel slung between Euclid and Superior avenues in downtown Cleveland.

Their proposal: reposition the historic building as a cultural hub, with museums, small merchants, a broad menu of ethnic foods and, perhaps, consulate of-

fices. The idea is to put the city’s heritage on display while finding out-of-the-box uses for challenging indoor retail space.

That concept has early buy-in from Skyline Investments Inc., the Arcade’s owner, even as the Toronto-based hospitality company weighs a sale of the landmark property. CEO Blake Lyon confirmed in an interview that Skyline is in discussions about shedding its U.S. assets, a portfolio that also includes the Renais-

Sale considered for Hyatt Regency and Renaissance Hotel. Page 13 sance Cleveland Hotel on Public Square.

The retail project “will only enhance” the Arcade, where the upper floors are home to a Hyatt Regency hotel, Lyon said. “Any new owner would be crazy not to consider it,” he added.

See ARCADE on Page 12

‘I would not want to compete with her’ Heidi Petz and John Morikis discuss succession plan for Sherwin-Williams’ first woman CEO Morikis said during an interview Oct. 11 at the company’s historic It was early 2020, and execu- headquarters in downtown tives at the Sherwin-Williams Co. Cleveland. “And I would say it were navigating a crush of chal- this way: I would not want to lenges: A global pandemic. Sup- compete with her.”

Petz, an Akron native who ply chain disruptions. And the grew up in Pennsylvadecision, nonetheless, nia, currently acts as to push forward on a the publicly traded new corporate headcompany’s president quarters complex and a and chief operating offifreestanding technology cer. She previously center in Northeast worked at the Valspar Ohio.

Corp., a competitor that Heidi Petz asked CEO Sherwin-Williams acJohn Morikis what was quired in 2017. Before keeping him up at night. Petz that, she held roles in His answer: Cash. Not marketing at Newell just the well-being of the Editorial: Petz Rubbermaid and Target global coatings giant but joins growing Corp. the liquidity of its cus- ranks of “Early on in our Valtomers. women CEOs. spar transition days, she The Fortune 500 com- PAGE 6 immediately hit the rapany’s succession plan, dar as ‘Wow, this is a announced Wednesday, CEO prepared Oct. 11, was forged in for challenges, very special person with very special talents,’” moments like that. Petz, analysts say.

Morikis said, lauding who joined Sher- PAGE 15 Petz’s “followship.” win-Williams in 2017 as Followship? “If she said, part of a large acquisition, is in line to become the 157-year-old ‘Guys, let’s jump off a cliff.’ Evcompany’s next CEO — and its eryone jumps,” Morikis said. first female leader — on Jan. 1, “And it’s terrific. Her ability to execute and move the organiza2024.

“I have watched Heidi through tion is truly like nothing I’ve ever these challenging times pick the seen.” right investments. The right people. And execute the strategy,” See PETZ on Page 16

By Michelle Jarboe

VOL. 44, NO. 38 l COPYRIGHT 2023 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED

Cleveland Browns running back Nick Chubb is carted off of the field after hurting his knee during a Sept. 18 game against the Pittsburgh Steelers at Acrisure Stadium. The stadium uses Kentucky bluegrass for its field. | GETTY IMAGES

GRASS OR TURF?

NFL players are increasingly calling for grass fields, but a study revealed little difference in the injury rates for synthetic surfaces and natural grass

By Joe Scalzo

O

n the night of Sept. 18 — “Black Monday,” if you’re a Browns fan — ForeverLawn co-owner Brian Karmie was sitting in the stands at Acrisure Stadium in Pittsburgh when Steelers safety Minkah Fitzpatrick delivered a helmet-first hit

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to Nick Chubb’s knee, and a nasty blow to Cleveland’s playoff chances.

“I saw it on the Jumbotron and I got nauseous,” said Karmie, whose company is the official synthetic turf partner of the Browns. “That was a really gruesome injury.”

Two hours away, as Brian’s brother Dale watched the game

on TV, one thought popped into his head: “What if that had happened on artificial turf?”

The NFL’s concussion crisis has faded in recent years thanks to a combination of helmet innovations and rule changes, opening the door for a new health issue to surface.

See SURFACES on Page 16

10/13/23 1:00 PM

What to know about Issue 2, Ohio’s marijuana referendum Voters have another opportunity to legalize recreational weed

By Jeremy Nobile

What is Issue 2, and what does it mean for consumers?

Issue 2 is a proposed law that, if approved, legalizes and regulates recreational marijuana consumption for Ohioans aged 21 and older.

The most marijuana that adults may purchase or possess at one time under the proposed adultuse program is 2.5 ounces of flower and 15 grams of extracts, according to the law.

Besides permitting the use, possession and transport of marijuana legally obtained in the state, Issue 2 would also allow for adults 21 and older to grow cannabis at home with up to six plants per person but 12 plants in total per household, regardless of the number of adults living there.

Someone caught exceeding these limits could be subject to criminal penalties.

What else does Issue 2 do?

Among various elements of Issue 2 is a provision establishing a Division of Cannabis Control within the Department of Commerce—which lawmakers agreed to create earlier this year regardless of whether Issue 2 is passed or not.

That division is to serve as the program’s primary regulator.

Among many things, it would oversee licensing for cultivators, processors, dispensaries, testing labs and their affiliated employees.

Ohio’s existing medical marijuana program and its licensed business entities remain in place if Issue 2 is passed, but those medical licensees must still apply for adult-use licenses.

Issue 2 also would create a “cannabis social equity and jobs program” implemented by the Ohio Department of Development. According to the proposed law, that program is intended to “remedy the harms resulting from the disproportionate enforcement of marijuana-related laws and to provide financial assistance and license application support to individuals most directly and adversely impacted by the enforcement of marijuana-related laws who are interested in starting or working in cannabis business enterprises.”

In terms of licensing, regulators would be required to give preference to applicants who are certified by that program.

Additionally, Issue 2 would create a program for cannabis addiction services to be implemented

BUCKEYE RELIEF

With Issue 2, Ohioans have another opportunity this fall to legalize recreational marijuana.

With early and absentee voting for the Nov. 7 election underway, here are some key details to know about Issue 2.

by the Ohio Department of Mental Health and Addiction Services.

As explained in an outline from the Ohio attorney general’s office, that program would include “best practices for education and treatment of individuals with addiction issues related to marijuana or other controlled substances, including opioids, as well as a toll-free telephone number Ohio residents could call to obtain basic information about addiction services available and options for an addicted consumer to obtain help.”

What about taxes?

Issue 2 creates a 10% excise tax for adult-use sales paid at the point of sale. Adult-use consumers will pay that tax plus sales tax.

Medical marijuana products are subject to sales tax. They would not be subject to that excise tax.

Because of this, there is still an incentive to have a medical card for patients who are eligible for one.

According to Ohio State University’s Drug Enforcement and Policy Center, taxes and fees related to the medical marijuana program have generated approximately $183.33 million for state and local government entities as of March 2023.

Ohio could see approximately $276 million to $404 million in additional annual tax revenues in the fifth year of an adult-use program, according to DEPC. Revenues generated by the excise tax would be divided into separate funds, which help pay for: the social equity and jobs program; the substance abuse and addiction program; operation of the Division of Cannabis Control; and approved purposes for municipalities or townships that have recreational marijuana dispensaries in their jurisdictions.

How does Issue 2 impact employers, landlords and local governments?

Nothing in Issue 2 undermines the rights or abilities for employers, landlords or local govern-

ments to implement their own policies with respect to marijuana.

Stated differently, Issue 2 does not create any novel protections for employees or tenants who choose to use marijuana, and municipalities still have some degree of control over allowing dispensaries in their respective jurisdictions.

Employers can still terminate employees or refuse to hire prospective workers based on marijuana use.

Landlords would be allowed to prohibit marijuana use as well so long as that prohibition is explicitly outlined in the lease agreement.

And government entities may still pass laws prohibiting marijuana companies from operating in their jurisdictions, though operators could petition to bring the issue before voters in the next general election. If voters approve such a measure, the local government must abide.

Who supports Issue 2?

According to the latest Gallup poll, 68% of Americans favor marijuana legalization. That includes Cleveland Mayor Justin Bibb.

In Ohio itself, a recent third-party poll conducted for the campaign behind Issue 2—the Coalition to Regulate Marijuana Like Alcohol—indicated that just shy of 60% of voters surveyed support the proposed law.

The burgeoning legal cannabis industry stands to greatly benefit from Issue 2 as well, which is why several existing medical operators have provided support to the campaign.

According to a Crain’s analysis, as of this spring, the largest financial supporter of marijuana legalization in Ohio was the Marijuana Policy Project, a Washington, D.C., legalization advocacy group that credits itself with helping to pass 15 medical marijuana laws and legislative reforms in a dozen other states with adult-use programs.

While MPP had provided a little more than half of the financial

contributions provided to the CRMLA campaign as of this May, the remainder came predominantly from medical marijuana companies. That includes operators such as The Firelands Co., ATCPC of Ohio (dba Klutch Cannabis), Standard Wellness Co. and Buckeye Relief.

An adult-use marijuana program could, naturally, be a boon for existing cannabis companies in the state, which are looking for a boost amid ongoing challenges and a lackluster medical program that has just 182,000 registered patients today, which is just 1.5% of the state’s population.

Who opposes Issue 2?

Several business and religious groups have voiced opposition to Issue 2, including the Catholic Bishops of Ohio, the Ohio Chamber of Commerce, the Ohio Business Roundtable, the Ohio Manufacturer’s Association and the Ohio Insurance Institute.

The business associations cite concerns with how the availability of recreational marijuana could impact absenteeism and safety in the workplace, though there are many studies suggesting those concerns may be overblown.

Of course, marijuana consumption is occurring whether Issue 2 passes or not.

According to Statista, approximately 21% of the Ohio population consumes cannabis in some form.

And according to the Centers for Disease Control and Prevention, an estimated 18% of all Americans used cannabis in 2019.

How did we get here?

The measure qualified for the ballot as an indirect initiated statute, which is one of three methods permitted by the Ohio Constitution to amend state laws.

As an initiated statute, the measure first requires proponents to collect signatures of support from registered voters equal to 3% of total votes cast in the most-recent

gubernatorial election.

With those signatures in hand, the proposed law is transmitted to the state legislature.

At that point, lawmakers have about four months to act on the proposal.

If no action is taken after that time, or the measure is not passed as presented, proponents may gather a second tranche of signatures enabling the proposal to come directly before voters.

This is what transpired with Issue 2.

It has taken several years to reach this point.

The campaign behind the proposed law, the CRMLA, actually formed back in 2020. However, the campaign was stymied by the COVID-19 pandemic, which made signature gathering prohibitively difficult.

The measure was poised to come before voters in fall 2022, but Republican lawmakers raised technical questions about whether the CRMLA met filing deadlines for its initial voter petitions— which were submitted within a seemingly permitted post-deadline remedy period after the campaign came up short of verified signatures.

While the CRMLA said it was prepared to fight that challenge, a settlement was reached that allowed the campaign to carry forward its initial petitions to the beginning of 2023, which set everything in motion this year.

Didn’t Ohio already vote on recreational marijuana?

The last time Ohioans voted on recreational marijuana was in 2015 via that year’s ill-fated Issue 3.

That measure would’ve written into the Ohio constitution provisions restricting cannabis cultivation to just 10 pre-selected companies. Anti-Issue 3 campaigns locked onto that detail and framed the measure as creating a cannabis monopoly, though it would’ve actually been an oligopoly.

The Issue 3 campaign also marked the debut of “Buddie,” a cartoony superhero mascot with a marijuana bud for a head that clearly didn’t win over many people: the proposal bombed with just 35% of voter support.

Despite its sound defeat, Issue 3 was a wake-up call for lawmakers who were now concerned that cannabis laws could be created without their control.

In this sense, Issue 3 opened the door for 2016’s House Bill 523, which created the legal infrastructure for the state’s medical marijuana program.

Then-Gov. John Kasich signed that bill in June 2016, and Ohio’s first medical marijuana dispensaries opened their doors in January 2019.

States typically pass medical marijuana laws before going full rec, and Ohio could be the latest example of that. If Issue 2 passes, Ohio will become the 24th state in the country to allow adult-use marijuana despite a lingering overhang of federal prohibition.

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Ketamine clinics hope to ‘open new doors’ for patients with depression

By Paige Bennett

Austin Hoover’s depression had been weighing him down for years.

Despite treatment and therapy, the Shaker Heights resident continued to struggle.

That’s when his therapist, Dr. Melissa Briggs-Phillips, suggested he try ketamine-assisted psychotherapy, which uses low doses of the dissociative anesthetic to manage mental health conditions like major depression.

Hoover went into the treatment with an open mind, but he was still surprised by the results.

“What was amazing for me was what happened after the infusions,” he said. “There were doors that were stuck for me in therapy, and this allowed me to open some of those doors that were difficult for me to open.”

The treatment helped Hoover lift the floor on his treatment-resistant depression, he said, and stopped the repetitive thoughts that had plagued him for years.

Ketamine has been used as an anesthesia during surgery since the U.S. Food and Drug Administration approved the drug for that purpose in 1970, but in recent years, researchers have been looking into ketamine as a treatment for severe psychiatric disorders.

They believe administering the drug in controlled, clinical settings can help those with treatment-resistant depression and other conditions.

“I open doors, I believe, for people to find the things they’ve suppressed or repressed, the things that are holding them back,” said Dr. David Caldwell, anesthesiologist at MiNDSET Integrated Ketamine Care Clinic in Columbus.

“That can be depression, that can be anxiety, it can be PTSD or suicidal ideation.”

For medical professionals, ketamine is not a first-option treatment for depression. In general, it is used when other treatments, such as antidepressants, have not been effective. Ketamine treatments are typically delivered by IV infusion or an intranasal spray.

It works by targeting NMDA receptors in the brain, according to Columbia University Irving Medical Center. When the drug binds to these receptors, it appears to increase the amount of glutamate, a neurotransmitter, in the spaces between neurons, which activates another receptor. The combination of these effects results in the result of other molecules along new pathways, a process that likely affects mood, cognition and thought patterns.

A study published earlier this year in “The New England Journal of Medicine” showed that ketamine is at least as effective as electroconvulsive therapy for patients with treatment-resistant major depression without psychosis.

Dr. Brian Barnett, a psychiatrist at Cleveland Clinic Lutheran Hospital, said there has been sig-

nificant research on the effectiveness of ketamine for treatment-resistant depression over the past 20 years. But recent developments in the area have accelerated interest in recent years.

In 2019, the FDA approved intranasal esketamine, a chemical cousin of ketamine, for treatment-resistant depression. The federal agency, however, has not yet approved ketamine for people with treatment-resistant depression.

“Our brain is always firing in new ways,” Briggs-Phillips said.

“But when something has happened over and over and over again, it’s like the grooves of a sled going down a hill. Your brain gets in a habit. And in talk therapy, we certainly challenge that … the folks after six infusions of ketamine, it has been remarkable to me what we are able to do, the insight, the resolution, the shift.”

Hoover had six total ketamine infusions, which he finished about a month ago.

Since then, he said he has felt much more in control of his depression.

“I think for people who have treatment-resistant depression, it makes a lot of sense for them to try,” he said. “I’m really excited for more science to be done, because it might help even more than we realize.”

Lynn Nguyen is chief strategy officer for New Pathways, a clinic that offers both ketamine treatments and FDA-approved Spravato nasal spray. The clinic has locations in Middleburg Heights and Columbus.

Nguyen said New Pathways opened in 2021 and has seen steady growth so far.

“There’s been a huge difference in the health care field, for me at least, to see my patients improve so much in such a little amount of time,” she said. “And be able to uncover some of their traumas that they’ve never been able to even think about. It’s almost like a new mindset that they just after these treatments.”

Caldwell said the treatment is especially important because an increasing number of people are suffering from mental health conditions.

A 2021 National Survey on Drug Use and Health found that an estimated 21 million adults in the U.S. had suffered from at least one major depressive episode.

Barnett said there is an extreme access problem with ketamine treatments and that a single treatment may cost anywhere from $500 to $2,000. And because ketamine is not FDA-approved, it’s not covered by insurance.

He also noted controversy in the field over the growth of free-standing clinics because some don’t have the proper mental health background to provide patients with the necessary care.

Caldwell said that cost is a barrier for many who may otherwise be interested in receiving ketamine treatments and that he hopes to make them more accessible in the future.

“My goal is to create a foundation where we can make this accessible to people who are motivated and want to get better, that meet criteria,” he said. “For me, it will be veterans. Veterans, by and large, don’t have the means to afford this care, but they might be one of the most significantly impacted sectors of our population.”

“I think for people who have treatment-resistant depression, it makes a lot of sense for them to try.”

— Austin Hoover, ketamine patient Barnett said research has shown ketamine to have rapid antidepressant effects. It has also been shown to help reduce suicidal thoughts.

But the effects are short-lived, Barnett said, making ketamine a maintenance treatment for depression.

The Cleveland Clinic usually administers ketamine by IV for patients with chronic pain, Barnett said. Those receiving the treatments for depression will typically receive esketamine, a nasal spray.

Since the FDA approved intranasal esketamine, ketamine clinics have been popping up around the U.S. In Ohio, there are clinics in Middleburg Heights, Toledo, Dayton and the Columbus area.

At MiNDSET, Caldwell reviews a patient’s medical history prior to an infusion. When the patient arrives for treatment, he conducts a brief physical exam of their heart and lungs, then takes them back to an infusion room.

“You get an IV in,” he said.

“You’re going to put headphones on, either noise cancellation or some non-vocal music. You’re going to wear an eyeshade that completely blocks out light. We’re going to lean you back, and the infusion is going to begin.”

Caldwell said the infusions create a dissociative experience that generally lasts about 40 minutes.

Patients typically wake up 10 to 20 minutes after the infusion is completed. Caldwell checks their vitals.

“It’s pretty amazing how quickly patients get back to baseline,” he said.

Side effects of ketamine can include dissociation, intoxication, sedation, high blood pressure, dizziness, headache, blurred vision, anxiety, nausea and vomiting, according to Harvard Health Publishing.

MiNDSET combines ketamine treatments with psychotherapy.

Briggs-Phillips serves as the clinic’s psychologist-in-residence.

Patients can meet with her or bring their own therapist to the clinic to work with them following their ketamine experience. The goal is to help patients uncover problems and then process them in therapy.

4 | CRAIN’S CLEVELAND BUSINESS | OCTOBER 16, 2023

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EDITORIAL

Incoming Sherwin-Williams leader to join small but growing ranks of women CEOs T

his year, public companies in the Fortune 500 crossed a threshold that, depending on your perspective, either illustrates meaningful progress toward equality in the C-suite or underscores just how far we have to go.

The milestone: For the first time in the Fortune 500 list’s 68-year history, more than 10% of the companies were led by women. But just barely. As of Jan. 1, 2023, there were 53 female CEOs of Fortune 500 companies, representing 10.6% of the list.

That’s not a huge figure, obviously, but given that the ranks of female CEOs on the list had been stuck around 8% for a few years, it represents movement in the right direction.

Cleveland, it turns out, is playing a big role in this small revolution.

Sherwin-Williams Co., the paintmaking and coatings giant that has made a major commitment to the region with a new downtown Cleveland headquarters and an R&D center in Brecksville, on Wednesday, Oct. 11, announced that Heidi G. Petz will become CEO on Jan. 1, 2024. She will succeed CEO John G. Morikis, who will take on the role of executive chairman. Petz will be the 10th CEO in the 157-year history of Sherwin-Williams — and the first woman to hold that position.

When Petz becomes CEO next year, she will be the third woman chief executive among the seven Northeast Ohio companies that were on this year’s Fortune 500 list and remain public companies. (An eighth company that was on the list, Westlake-based TravelCenters of America, was acquired in May by BP and no longer is a standalone public company. TravelCenters, now operating within BP, on Sept. 1 named a woman, Debi Boffa, as CEO.)

Heidi G. Petz (center) will be the third female chief executive among the seven Northeast Ohio companies that were on this year’s Fortune 500 list, joining Jennifer A. Parmentier, CEO of Parker Hannifin Corp. (left) and Tricia Griffith, CEO of Progressive Corp. | CONTRIBUTED PHOTOS

The largest Northeast Ohio company on the Fortune 500 list, Mayfield Village-based insurance giant Progressive Corp., has been led since July 2016 by president and CEO Tricia Griffith.

The fifth-largest Fortune 500 company in this region, Mayfield Heights-based motion and control technologies producer Parker Hannifin Corp., also has a woman CEO, Jennifer A. Parmentier. She’s one of the CEOs who helped push the list above the 10% figure, as Parmentier took the top job at Parker on Jan. 1 of this year.

At Crain’s, we rank our annual list of Northeast Ohio public companies based on market capitalization, and come Jan. 1 of next year, women will lead the companies ranked No. 1 (Progressive, with a market cap of $79.8 billion as of May 3, 2023), No. 3 (Sherwin-Williams, at $61.3 billion) and No. 5 (Parker, at $41.4 billion).

That’s relatively heavy representation for

women CEOs among the heaviest hitters in Northeast Ohio’s corporate circles. And that doesn’t take into account the women who lead significant private companies and other institutions, such as GOJO Industries CEO Carey Jaros and Loretta Mester, president and CEO of the Federal Reserve Bank of Cleveland.

These women leaders are in their jobs because they’re excellent executives, full stop, and they’re judged, as are all CEOs, by the performance of their companies/organizations. It shouldn’t be any other way. At Sherwin-Williams, Petz, who has been president and chief operating officer for the last two years, was chosen after what Morikis called a “comprehensive process and multi-year organizational succession plan to identify the best candidate to lead the company.”

But what remains a lack of representation, at the huge companies that are part of the Fortune 500 on down to much smaller

businesses, means that many women and minorities still are not getting a fair chance to prove themselves capable leaders and innovators. (Among the female CEOs mentioned here, it should be noted, none are minorities.)

There are, on the Crain’s list of 62 public companies in Northeast Ohio, only two other women CEOs: Virginia C. Drosos of Akron-based Signet Jewelers, which was No. 20 on the list with a market cap of $3.3 billion, and Suzanne I. Barth of a small Canton-based company, Concrete Leveling Systems Inc., ranked No. 48 on the list with $37.6 million in market cap.

Among the 50 largest public companies across the state of Ohio, there are only three other women CEOs, all in the Columbus area, according to Crain’s data: Julie Sloat of American Electric Power, Gina Boswell of Bath & Body Works Inc. and Fran Horowitz of Abercrombie & Fitch.

There’s progress, certainly, but still a long way to go. And it’s not just symbolic. There’s plenty of research showing that diversity in leadership positions — with respect to women CEOs as well as minority executives — benefits corporate performance. More diversity in leadership means solving more problems for more people, and more opportunities for companies to find ways to grow.

Leaders in Cleveland — and anywhere — can’t unlock the full potential of their organizations if they aren’t giving their full attention to finding and developing talent. It’s on them to build systems where everyone of every background has a chance to flourish.

Most won’t become CEO. But establishing a pipeline of diverse leadership is the best way to make sure that the next CEO selection is the right one.

PERSONAL VIEW

Here’s what nonprofits should do to help people and grow Cleveland’s economy

W

Interim Editor: Ann Dwyer (adwyer@crain.com) Managing Editor: Marcus Gilmer (marcus.gilmer@crain.com) Contact Crain’s: 216-522-1383 Read Crain’s online: crainscleveland.com

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.

GETTY IMAGES

ple merger attempts fall apart — ith almost 15,000 nonuntil last month, when MAGNET profits in Greater Clevesuccessfully combined with EDGE, land, the limited pie of an executive learning and ecocivically engaged leaders and donomic development nonprofit. nor pools simply can’t be split that We both focus on helping small many ways. In the economic develand midsize companies grow. opment space alone, where my EDGE brings strong leadership denonprofit MAGNET sits, there are velopment programs that nicely 86 organizations. That’s far more per capita than peer cities such as Ethan Karp is round out MAGNET’s offerings as we help manufacturers prepare for St. Louis or Minneapolis/Saint president and a whole new era of smart manufacPaul. This can make it difficult for CEO of turing. businesses and donors to even MAGNET. By consolidating programming, know where to start to give their MAGNET and EDGE will reach more commoney and time.

We need to make it simpler, faster and panies and combine the influence and ateasier by consolidating wherever we can. tention of both our boards. Ultimately, we That’s easy to say and hard to do. Even aim to show how decluttering our nonprofit though the sandbox is crowded, no one ecosystem can benefit everyone. I’d guess wants to give up their spot. I sit on several nonprofit boards, and I’ve watched multiSee NONPROFITS on Page 17 Sound off: Send a Personal View for the opinion page to ClevEdit@crain.com.

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Bank of America has a significantly smaller branch network in Ohio than several of its competitors in the state but added at least a dozen new locations between June 2022 and June 2023 as it builds up a franchise here. | BANK OF AMERICA

Ohio saw more bank branch closures in the past year But the overall pace slowed significantly

By Jeremy Nobile

The total number of bank branches in Ohio decreased in the past year once again, but the overall pace of those closures has slowed significantly.

Between June 2023 and June 2022, less than 1% of all branches in the Buckeye State were closed, according to the latest data from the Federal Deposit Insurance Corp.

In the couple of years prior, however, branches were consolidating in Ohio at a clip greater than 4%, a rate that was outpacing the national average.

The branch consolidation trend has been playing out for many years in line with a shift toward tech-enabled banking services. These closures have, naturally, been concentrated among large banks with large retail footprints, which may not feel as necessary in an increasingly digital world. Then, as the COVID-19 pandemic hit, the pace of consolidation picked up.

While banks were considered essential businesses during pandemic lockdowns, the health crisis was an opportunity for financial institutions to steer customers toward digital banking methods that—in most instances—were already in place for all but the smallest institutions.

As the public increasingly embraced tech-enabled alternatives to in-person banking, companies justified closing more locations, trimming costs of operating physical offices along the way.

According to an analysis by the National Community Reinvestment Coalition, prior to the pandemic, the banking industry was closing an average of 99 branches

per month. During the health crisis, that pace doubled to approximately 200 per month.

From 2020 to 2021, branches consolidated nationwide at a rate of 3.8%. And from 2021 to 2022, another 3.2% of branches across the country were eliminated, according to the FDIC. In Ohio, where the rate of closures since the pandemic had eclipsed the national average, concerns were raised about the impact that trend has on lower-income communities, where closures often concentrate.

“Branches in (low- to moderate-income) areas are already less common,” Jason Richardson, senior director of research for the National Community Reinvestment Coalition, told Crain’s earlier this year. “Even a small number of closures leaves sections of many cities without banks, and those tend to be in minority, LMI tracts.”

About 2% of Ohio branches were closed between 2018 and 2019, according to the FDIC. Another 2.4% of branches were shuttered between 2019 and 2020.

Statewide branch closures then jumped to 4.8% between 2020 and 2021. And from 2021 to 2022, another 4.3% of branches were closed.

Some of the biggest consolidators across the state between 2021 and 2022 included Huntington Bank — which closed 56 Ohio branches early in 2022, 70% of which were in-store Giant Eagle locations—Fifth Third Bank (27 closures) and PNC Bank (23 closures).

Banks continue to adjust their branch footprints, but a slower pace of closures suggests that the industry may feel that much of the fat has already been trimmed.

There are, of course, some new branches that come online each

year between growing community banks and expanding regionals. So net closures each year are partly offset by those.

There were 3,106 bank branches in Ohio as of June 2023, according to the FDIC. That means just 25 branches were closed since the prior year, marking a consolidation rate of just 0.8%, which is less than the national consolidation rate between June 2022 and June 2023 of 1.7%.

Some of the top consolidators in Ohio between June 2022 and June 2023 include PNC Bank (12 closures), Fifth Third Bank (10 closures) and U.S. Bank (eight closures).

Physical locations are still very much part of most banks’ business models, even if those locations are less of a necessity than they were a generation ago.

That’s why Bank of America, the second-largest bank in the country with nearly $878 billion in assets, has been opening new branches across Ohio as it works on re-establishing its franchise in this market. Between June 2022 and June 2023, the company opened a dozen offices in the state, according to the FDIC, which has grown its branch network to at least 43 locations today.

An example of a smaller bank building out its branch network would be Premier Bank, a Youngstown-based institution with approximately $8.6 billion in assets that has been adding to its branch footprint across Northeast Ohio with plans for more to come.

“You still need some brick and mortar in the market to bring the full package to the client,” said Premier president and CEO Gary Small. “We all see some value in it if you want to do business at the consumer level. Brick-and-mortar is still part of that equation.”

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10/12/23 9:19 AM

THOUGHT LEADER REPORT

SPONSORED CONTENT

TECHNOLOGY

AI is everywhere: Strategies to safeguard your company’s innovation

A

lthough AI has been around for years, ChatGPT’s viral moment illustrates how AI tools can surprise us with their abilities. Just this May, Samsung recorded several instances of employees uploading confidential code to ChatGPT, exposing the company’s sensitive data to potential security risks. As businesses embrace AI technologies, they must navigate a complex, quickly changing landscape of regulatory, security and ethical concerns.

Because of the absence of federal AI regulations, it is crucial to establish internal AI governance that ensures responsible use while also facilitating successful digital transformation. But how can businesses control company use of powerful, wide-reaching AI tools? Approaching AI management from three angles — governance, security and ethics — is a holistic strategy that ensures AI protects assets, promotes best interests and operates ethically.

JOSEPH OURS Director, AI Strategy Centric Consulting joseph.ours@centricconsulting.com Joseph Ours is the Director of Centric Consulting’s AI Strategy and Modern Software Delivery Practice. With more than 25 years of expertise in IT and team leadership, he excels in devising strategies that achieve significant business outcomes by leveraging advanced technologies for organizations.

Governing AI usage Governance is the foundation on which companies build responsible AI practices. It not only ensures

compliance with laws and regulations, but it also fosters transparency. To manage AI adoption, companies should form a stakeholder committee to create policies that align with industry requirements and organizational goals.

encrypt sensitive information and restrict AI access to authorized personnel.

ensure the integrity of its generated content. Most ethical issues with AI, however, are user errors.

Additionally, the stakeholder committee should prohibit those employees from entering sensitive

Once policies are in place, the committee should establish key performance indicators (KPIs), considering costs, risks and the company’s goals. Afterward, the committee can lead training sessions and workshops to communicate best practices to relevant employees. As a standard practice, the committee should regularly monitor AI performance, review current company AI projects, raise concerns, and discuss the latest AI innovations.

“Expertise is the foremost defense against the misuse of AI tools.”

To prevent unintended but serious ethical consequences, employee AI training must cover data security and responsible use, including when and when not to leverage AI.

data into AI tools without express executive permission and train them to use AI securely so they not only protect sensitive data but also anticipate and recognize potential security threats.

Securing AI solutions As Samsung’s case illustrates, the improper use of AI tools can lead to data breaches, regulatory violations, and reputational damage. Many executives fear “leaky data,” the accidental release of proprietary information to a third-party system.

To ensure a secure work environment that leverages AI technologies responsibly, companies should

Prioritizing AI ethics AI technologies pose several ethical risks, including harming users and perpetuating damaging biases. For example, in the mortgage industry, AI algorithms assessing loan applications have exhibited higher denial rates for minority applicants, a phenomenon known as high-tech redlining.

Additionally, AI’s susceptibility to plagiarism necessitates safeguards to

Expertise is the foremost defense against the misuse of AI tools. Once users recognize existing data biases and the ethical risks AI poses, they can reduce their impact on their work.

Implementing AI responsibly Despite AI’s challenges, forbidding its use would be detrimental. Banning AI means preventing your employees from using essential apps like Word and Excel, which Microsoft is actively integrating with Copilot, an AI assistant.

Organizations can harness the potential of emerging AI models like ChatGPT responsibly so long as they plan accordingly. Establishing internal regulatory, security and ethical practices will empower your organization to use AI to remain competitive and chase innovation.

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10/12/23 1:41 PM

Builder’s perseverance to bring apartments to Tremont, Duck Island

By Stan Bullard

For five years, Matt Berges, the owner of Berges Home Performance LLC of Cleveland, called up The Flats Industrial Railroad to buy what he calls “some slivers of land” jutting from the railroad near Willey Avenue between Train Avenue and Columbus Road.

Then, last summer, the shortline railroad, which stopped operating in 2020 and just last month received approval to shut down, called him.

“They wanted me to buy it all,” he said of the two-mile spur.

“They were disappointed I didn’t want it all.”

Still, that’s how Berges got three parcels, less than an acre in size in total, in a $100,000 purchase from the railroad according to Cuyahoga County land records. The land was necessary to let him get a planned apartment complex on Willey called Cooper Flats back on track. (He declined to comment on the price paid.)

Patience and perseverance such as that are key to how this urban homebuilder operates.

Berges also is pushing to get started by this winter or early spring on Cooper Flats. One of the trio of parcels he bought from Flats Industrial Railroad will allow the first phase of the project to increase 17 apartments to 21.

Berges had put the project on hold in 2022 because of spiraling construction costs. Then interest rates shot up. Now, Berges believes the additional units, combined with going after Opportunity Zone investors, will make the project a go.

“It barely worked when interest rates were 4%,” he recalled.

A second phase on the north side of Willey is also under consideration, though the timing for it is not yet set.

Berges and Bo Knez, the owner of Knez Homes of Concord Township, who also builds in the city of Cleveland, have formed a joint venture to develop parcels they own on the north side of Willey together.

“For years, I’d say to Bo, ‘Sell me that land by the railroad.’ He’d say, ‘You sell it to me,’” Berges said.

Finally, the two have decided to cooperate on building one project that combines both their holdings, which could accommodate more than 150 units.

In a phone interview, Knez said it was a case of both men wanting to develop the land.

“Doing it together just makes for a better use of the land,” Knez said, “and a better project.”

Two of the parcels that Berges bought from the Flats Industrial Railroad will also aid the development of the project on Willey’s north side.

Berges is best known for building almost 80 homes, along with several substantial home restorations, in the part of Tremont dubbed Duck Island—atop the Cuyahoga River valley around Hope Memorial Bridge between Lorain and Train Avenue. All told, he’s built about 150 homes, including custom homes for clients

A rendering shows the Cooper Flats apartments. | HORTON HARPER ARCHITECTS

in the suburbs. But it’s clear revitalizing the city is close to his heart.

Looking at the downtown Cleveland skyline from the deck atop a four-floor, $695,000 townhouse on West 11th Street that already has a buyer, Berges said, “It’s this view that sells all my houses.”

On a driving tour, between sudden stops to wave to residents of Duck Island who bought homes from him or some of his staffers, Berges points out his latest crop of houses. Seven are going up in Duck Island, and, because empty lots on Duck Island are getting scarcer, another five are going up in other parts of Tremont. Another seven are on West 30th Street south of Monroe Avenue in Ohio City.

That doesn’t include three custom homes on lots on West 12th, West 17th and West 28th streets.

“We started out only building after going to contract,” he said, but that has changed in the past few years as housing strengthened after 2011 and his company’s financial strength grew. So now it builds about half its inventory after buyers sign on and about half on speculation.

Most of the homes have contemporary designs but are put at a scale to fit the old neighborhood’s often pint-sized lots.

Many of the houses are designed

by Harper Horton Architects of Cleveland or Beegan Architectural Design of Lakewood.

“I had a friend tell me once he was having someone else build his house because mine are too modern,” Berges said. “But that’s what architects design for us. I’ve built lots of traditional houses through the years. It depends on what the buyer wants.”

Building in the Tremont area is appropriate. Visits to the landmark Treehouse pub in Tremont and going to parties at the homes of friends in the neighborhood showed Berges, then an American Studies student at the University of Dayton, what the urban life he had read about was really like.

“I studied psychology and sociology in college,” Berges said, because he felt that would help him understand people whatever he did later. The son of a General Electric Co. engineer who relocated often, he had thought of urban life as the area around downtown Stamford, Connecticut.

After graduating in 2000, he took what amounted to a gap year before starting his career.

He spent a year working for AmeriCorps at Habitat for Humanity in Redwood, California.

As he worked on the houses, he

fell in love with building.

“At that time, I assumed I would work in the corporate world,” Berges recalled. “I thought having a career meant putting on a suit and going to an office. It was only later that I learned what homebuilders do. And I found I could go to work every day like this, wearing jeans and a sweatshirt.”

He came to Cleveland because his wife, Colleen, was from here. He worked for several years with Sutton Builders before deciding to go out on his own as Sutton cut staff as the housing collapse took hold.

Sutton was building in Tremont, so Berges decided to start building on Duck Island, where Sutton wasn’t active.

“It was a very rough neighborhood at the time,” Berges said.

“There were two known drug houses nearby. I had a very good website.

I’d talk to people on the phone and be waiting to show them a lot. One guy called me on his cell phone as he drove by. His wife wouldn’t even stop to look at the building there.”

But step by step, that has changed.

David Sharkey, president of the

Progressive Urban Real Estate (PURE) firm in Ohio City, said he believes that, aside from a few double lots developed by Sutton, “Berges paved the way for other builders and developers to start building in Duck Island. There was a lot of vacant land there, but no one wanted anything built on it at public meetings. But I know there were people who would have been happy to sell vacant lots they owned for a little money.”

One way Berges changed things was by buying a vintage house built in 1890 on West 18th Street where he and his wife and three children live.

“It came with a few extra lots, so it gave me a start here,” Berges said.

“We have solar panels on the roof, so we often get an electric bill that’s on average zero for five people.

The house is near the building on West 19th Street that he uses as the office for his core team of 10, from project managers to office staff.

The firm has some tradespeople but typically serves as a general contractor, hiring subcontractors for each part of the job. He also said he works to have good relations with the Duck Island Block Club and his neighbors.

Because of his background building in California, Berges originally emphasized high-energy efficiency homes.

Those were steps that Sutton let him pursue and he later made his own company’s focus. Such energy-saving steps include using twoby-six pieces of lumber instead of two-by-fours because that leaves a larger area for insulation to be installed between the studs.

The energy-efficient selling point has diminished some because, since

the City of Cleveland required building green homes in exchange for tax abatements a decade ago, such steps are more common, which is also the case for many builders.

Driving past some houses that have changed hands since he built them, Berges observed that steep appreciation in value the last few years means some of his clients made more on selling their homes than he did building them.

He’s “sickened,” he said, by climbing construction and building material costs. Pointing out a house on West 18th that was built 20 years ago he said sold for $150,000, he estimates it would cost $400,000 to build the place today.

As for his current projects, Berges has already developed a group of townhouses atop the Willey hill near Columbus Road. Six units faced Willey and another 10 went in farther north. The units sold for about $500,000 each. Cooper Flats will have a similar design, with huge windows and stark white exterior walls.

Now Berges hopes a trail will replace the railroad. The City of Cleveland has five months more to decide if it wants to pursue putting a trail on the roadbed, although it hasn’t commented beyond telling the Surface Transportation Board it wants to study the idea.

PURE’s Sharkey said he believes Berges is on the cusp of doing for Willey and Train what he did for Duck Island.

“Soon outsiders will see it as part of this walkable neighborhood,” Sharkey said. “It’ll be more than just vacant land and a shortcut to take between Tremont and Ohio City.”

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10/12/23 9:18 AM

Jordan Cooper (from left), Alyah Chanelle Scott, Lexi Underwood and Kristin Stoller speak during the Forbes Under 30 Summit at Cleveland’s Public Auditorium. Below, Rainn Wilson (left) speaks to Seth Cohen during the summit. | GETTY IMAGES

Forbes’ big bash brings the spotlight to Cleveland

By Kim Palmer

Cleveland’s Forbes Under 30 Summit was four days of celebrity sightings, business advice from young entrepreneurs and a lot of good, old-fashioned networking.

The city of Cleveland hosted the first of three of the summits in Ohio, Oct. 8-11. The celebrity-filled event, dubbed “the greatest gathering of young leaders and entrepreneurs in the world,” included plenty of music, entrepreneurial talks and local tours held throughout the city.

Monday, Oct. 9, was a full day of talks and panel discussions at Cleveland’s Public Auditorium marketed as “business talk in the digital age,” involving business leaders and celebrities with panel discussion with titles such as “Rainn Wilson’s Vision on Solving Tough Problems with Spirituality,” “From Model to Mogul” and “Food Fight: Is Fake Protein For Real?”

The 100-year-old auditorium’s main ballroom was outfitted with a white couch VIP section up against the stage in front, free Under 30-branded reusable metal water bottles and multiple colorfully lit-up bars in the back. The celebrity-filled break-out business and entrepreneurial panels were to be the main attraction but more often it was the networking with the other attendees that was as important—if not more—than the panelists’ “work hard and be passionate” business advice.

One attendee who goes by BeFree came with his seven colleagues from Detroit where the Under 30 summit was held the year before. He said he made the trip for the connections. “I’m an artist,” said Be-Free, who is under 30 and works at Menace in Paradise, a media company out of Detroit. “I’m here for content, networking, and just expanding. I think the best advantage is meeting people.”

About 44% of the approximately

5,000 attendees came from outside of Cleveland, making the event perfect for meeting with young successful entrepreneurs who might need support growing their businesses.

“Everybody’s here for mostly similar reasons, whether it is networking, or partnerships, or just to experience something new and getting the opportunities,” said Brent Montgomery from Underdogs, a design agency and marketing agency in Cleveland. “Some people are in a situation where they just want to find other people that can help them build whatever they’re building.”

To help facilitate the networking, there was a nearly 2-hour lunch break—dubbed a “Local Food Festival”—that featured dozens of Cleveland food trucks parked outside the auditorium.

The time offered a lengthy, if chilly, chance to try new food and rub elbows.

Jordyn Wright, social media manager for Chicago-based Farmer’s Fridge, a company that sells fresh, convenient vending machine food, said events like the Under 30 Summit are the best way to get in front of the younger client base.

“I didn’t know quite what to expect. This is quite hip,” said Wright, who grew up in Cleveland but moved to Chicago during the pandemic. Wright was handing out chia pudding and yogurt and granola snacks to attendees.

“I was expecting like a formal suits vibe because in my head this has always been such a big, fancy event. I’m surprised to see so many people who look like me and talk like me. And a lot of these people are company founders too.”

Wright, who is exactly 30 years old, said she wasn’t surprised that Cleveland was selected to host the event. “I would say after being

away from Cleveland for the last three years and then coming back, Cleveland has changed a lot and this tracks with how it’s changing to host this kind of event,” she added.

One of the most touted discussions was between actor, entrepreneur and author Rainn Wilson and Forbes’ assistant managing editor Seth Cohen. Wilson, whose social media company Soul Pancake worked on an out-of-market branding campaign for Destination Cleveland, talked about the impetus behind his new book “Soul Boom: Why We Need a Spiritual Revolution,” which discusses the lofty themes of mental wellness, spirituality and capitalism.

Wilson, who is not under 30, tackled the heady issue of spirituality and human behavior arguing that people will always find something “larger than ourselves to serve and to interact with,” whether that’s politics, shopping, social

media influencers or celebrities, he said.

“We’re going to put people up on the altar. Human beings need to worship something. And if they’re not worshiping some kind of divine, creative, healing impulse, then we’re worshiping entrepreneurship. We’re the preachers. We’re the rabbis. We’re the lecturers. This is our sermon,” Wilson said to the crowd of attendees. “Capitalism can be harnessed for good. Entrepreneurship can be harnessed for good and for social change.”

Despite his concerns that a lot of young people have substituted ambition for meaning he also said he is optimistic about the younger generation. “I’m not just trying to kiss your butts,” Wilson said. “I believe younger folk are suffering tremendously in the mental health epidemic, suffering with anxiety about climate, suffering in uncertain political and financial arenas, but at the same time, bringing a dynamism and a need for change, they’re not accepting things the way they are.”

That optimism was shared by another over-30 attendee. Ohio State Sen. Kent Smith, who came to hear Wilson speak. Smith referred to the event as “an innovation convention.”

Smith, when asked his age, joked, “It’s a 30 under 30 event, so if you add those together I make the cut.”

But he added the summit perfectly encapsulated what he refers to as a new Cleveland, one that is confident hosting a national event and playing on a larger stage.

“Based on what I heard from Rainn,” Smith said. “He wasn’t talking about the city. He was talking about the future. And he was trying to instill that the future is these young people and that the future is in that room.”

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10/12/23 8:45 AM

SPONSORED CONTENT

Changing lives through opportunity for a career Deborah Vesy Systems Change Champion Award finalists re-think workforce development to give people impacted by poverty a leg up

By Kimberly Bonvisutto, Crain’s Content Studio-Cleveland

When the systems that enable working families and individuals to live healthy, happy lives no longer function, change is needed. This work isn’t simple, but several regional organizations are devoted to updating, restructuring and revitalizing the systems that allow people to thrive despite the challenges they’ve faced.

“The purpose of the aware is to ensure the transformative work she championed continues for many years,” said Cathy Belk, president and CEO of the Deaconess Foundation, a private foundation committed to helping those impacted by poverty build careers which sustain themselves and their families. “By highlighting systems change and innovation initiatives within the workforce ecosystem, we want our community to see not only the benefits to each individual impacted but also the long-term, sustainable changes and benefits. These improvements will help job seekers and employers for years to come.”

To honor these groups and the vital work they pursue, the Deaconess Foundation Deborah Vesy established the Deborah Vesy Systems Change Champion Award in 2021. The award Selected by Deaconess Foundation from a pool of applications, the winner of the award receives honors Deborah Vesy, who served as the Foundation’s president and CEO for 18 years and retired in 2020. an unrestricted $50,000 grant.

WINNER

FINALISTS

New Bridge As a trauma-informed, social/emotional learning center, New Bridge provides community-based training to help students identify and pursue educational and career pathways that lead to personal well-being, health equity and familysustaining wages.

Through a partnership with University Hospitals, New Bridge created a medical assistant program and training model for incumbent workers that also provides resources in a positive environment.

President and CEO Bethany Friedlander called it an once-in-a-lifetime opportunity for individuals to advance their careers while still working. The partnership promotes systems change and increases equity through a needs assessment, outlining specific interventions, resources and support services required to help students achieve their goals.

“What we know, ultimately, is problems don’t end with raises and new jobs. People still continue to have problems with transportation, housing, food insecurity,” she said. “Students are able to voice those ongoing concerns in a safe place.”

The medical assistant program just graduated its third cohort of students with a 100% passage rate on the national certification exam. The success of the program, which has helped 79 students to date, is leading to an expansion into a licensed practical nurse program that will begin in October with a pilot of 19 students.

As a healthcare sector intermediary, New Bridge brings employers to the table to share and replicate best practices.

Friedlander said the collaboration rose to a new level post-Covid, with employers exploring new pathways and doubling down on the importance of keeping quality employees. For the first time, she said, the work is about policy and procedures and looking more holistically at the workforce.

Northeast Ohio Worker Center

Youth Opportunities Unlimited

An organization built by workers, for workers, the Northeast Ohio Worker Center (NEOWC) is using the Guardians for Fair Work campaign to advance pro-worker policy throughout the region.

Fixing the complexities of the workforce ecosystem is the goal of Youth Opportunities Unlimited (Y.O.U.), a nonprofit workforce development organization that works to put youth on a path to economic self-sufficiency.

The campaign is a coalition of more than 30 labor, grassroots and community organizations that focuses on substantive job quality public policy. Recent wins include passage of wage theft ordinances in Cleveland, Euclid and Cuyahoga County that prohibit local governments from entering into contracts with companies that have a history of wage theft.

“Y.O.U. is ultimately about improving the community by taking on systemic racism and the pervasive cycle of poverty, transforming youth lives in the process,” said President and CEO Craig Dorn. “The most logical way to address those two issues is through the workforce. The four pillars of Y.O.U. programs are job readiness training, career exploration activities, coaching and mentoring, and paid work experience. With a focus on 14- to 24-year-olds, Y.O.U. partners with other organizations in deep and meaningful ways, to share expertise across a broader base through a shared staffing model.”

“We know that today, in Ohio, employers will steal $1.6 million from workers in the form of unpaid wages and, unfortunately, the vast majority of this theft will never be reported because workers don’t understand their rights in the workplace or the avenues at their disposal for recourse,” said NEOWC President Grace Heffernan.

Economic, political and social systems are functioning as designed, with American lives dependent on a “ready supply of cheap, disposable labor,” Heffernan said. That requires recognizing that the often tenuous conditions of working people are not a bug, but a feature of the system.

“These systems do not need to be tweaked to remove the bug, but radically altered to center people and ensure that work works for workers,” she said.

P011_CL_20231016.indd 11

The model creates synergy of comparable missions and goals while being cost effective with resources. One example of that model is Y.O.U.’s partnership with Open Doors Academy (ODA)’s afterschool program. Y.O.U. retains a full-time staff member who facilitates its Job Readiness Training curriculum for high school students enrolled in ODA’s afterschool program.

The partnership, which splits the cost of the employee, has brought more than 200 additional young people under the Y.O.U. umbrella of services.

“The model creates a sustainable and scalable framework to positively impact students,” Dorn said. “Y.O.U. approaches systems change through advocacy by helping legislators and elected officials understand how they can change the rules of engagement to better serve their constituents.”

Fairfax Renaissance Development Corporation The Fairfax Renaissance Development Corporation (FRDC) is on a mission to strengthen Northeast Ohio’s neighborhoods by addressing unemployment and underemployment among low- to moderate-income residents.

FRDC’s workforce program creates an employment path resulting in greater access to targeted jobs, facilitates connections to training and supportive services. This equation increases the likelihood of sustained employment and economic independence, says Jeri Mason, FRDC’s Workforce Development Manager.

The program focuses its recruitment efforts through partnerships with local employers, non-profits, libraries, government entities, faith-based institutions and community partner organizations.

During 2023, through monthly in-person hiring events, FRDC has helped Cleveland Clinic hire 42 new employees, and Towne Park, which provides parking and shuttle services for Cleveland Clinic, hired 18 workers.

Employment and resource events with partners Cleveland Neighborhood Progress and The City Mission connected potential workers with childcare, transportation and other resources – in addition to employers – leading to employment for another 68 individuals in 2022.

“Being able to have the potential employee and employer in the same room facilitates communication, allows people to share the mission of their organization and what they are looking for in employees, and people can market themselves in the best way,” Mason said.

10/12/23 1:42 PM

ARCADE From Page 1

Skyline and nonprofit group Downtown Cleveland Inc. are paying for a feasibility study of the new retail scheme, at a moment when the center city is trying to shake off the dampening effects of the pandemic. Separately, Downtown Cleveland Inc. is putting the final touches on a sweeping retail action plan that could be released this month.

“The progress is coming,” Lyon said, citing investments in office-to-housing conversions and downtown’s growing residential population. “But it’s been a slow slog for anyone trying to fill retail space in the meantime.”

The players behind the Arcade project are Dick Pace, the real estate developer who filled the humbler Colonial and Euclid arcades across the street with local retailers; Tom Yablonsky, a longtime evangelist for the city’s historic buildings; and Sandvick Architects, a Cleveland-based firm that shepherded a $60 million rehabilitation of the Arcade in 2001.

The study should be complete before the end of the year, the partners said. They believe their approach will bring more business to Skyline; make downtown feel less deserted; and give dispersed cultural organizations much better visibility in a central, yearround location.

“It’s not something somebody’s going to get rich on,” said Pace, the CEO of Cleveland-based Cumberland Development. “But it is something that can help the Arcade’s bottom line.”

Built in 1890, the Arcade consists of two nine-story buildings that bookend a five-story corridor topped by an iron-and-glass roof.

The property, often described as the country’s first indoor shopping center, started its life as retail and office space.

The 2001 redevelopment transformed the office towers into the 293-room Hyatt. Skyline acquired the property out of foreclosure in early 2012, after bidding a mere $7.7 million for it at a sheriff’s sale. Today, the company puts the value of the Arcade at $71.7 million.

Skyline, whose shares are publicly traded on the Tel Aviv Stock Exchange, has prioritized events over retail leases. A popular wedding venue, the Arcade hosts 60 to 80 events each year, according to an investor presentation. That cuts into the potential hours for retailers.

Plus, many of the shops are shallow — and small, starting out at 421 square feet.

“The storefronts are so lovely.

They’re like little jewels in there,” said Julie Dornback, a senior designer and project manager at Sandvick Architects The building’s total retail footprint, on two levels, is about 47,700 square feet. It’s 50% occupied, but many of the tenants are tied to the hotel. There’s a fitness center, the 1890 hotel restaurant and Marengo Luxury Spa. The other major occupants are a post office and Pizza 216.

Earlier this year, Skyline was

Many of the storefronts at the Arcade are sitting empty. The building is a popular wedding venue, and owner Skyline Investments has focused on building up the event business instead of leasing retail space. The building, often described as the nation’s first indoor shopping center, opened in May 1890. It underwent a dramatic renovation in 2001. | PHOTOS BY MICHELLE JARBOE

weighing whether to tear out the near-empty food court to create more event space. Then Yablonsky reached out with his proposal, which he described as an indoor counterpart to the sprawling Cleveland Cultural Gardens on the city’s East Side.

“The light bulb went off,” said Lyon, who put any interior demolition plans on hold.

Now, the food court might become an international dining hall.

Upstairs, cultural groups could have satellite museums or small shops, with a blend of individual and shared spaces.

Yablonsky and Pace said they’re

in preliminary talks with prospective tenants.

They recently presented the concept to Joe Cimperman, the president and CEO of Global Cleveland, a nonprofit focused on growing the region’s economy by attracting more immigrants and other newcomers. “My head is spinning,” Cimperman said.

He described the plan as authentically Cleveland. Cimperman is intrigued by the idea of treating the city’s cultural diversity as an economic-development engine, one that might boost hotel bookings but also drive more visitors to the Ukrainian Museum-Ar-

chives in Tremont, say, or the annual One World Day celebration at the Cultural Gardens.

“I think the one thing that is most missing in Cleveland is the risk gene. We all want the Chipotle, right? Because Chipotle is going to make sure that my real estate investment works. This is not Chipotle,” he said approvingly.

Yablonsky acknowledged that they’re not talking about regular retail leases, or market-rate rents.

But having some money is better than having nothing, said Pace, who master-leased the Colonial and Euclid arcades for a decade

and rebranded them as the 5th Street Arcades.

He stepped aside from that role last year. At 67, Pace doesn’t plan to commit to another long-term retail project. But he wanted to help find a solution for a downtown landmark.

“Everybody downtown has wished that the Arcade had more vitality, like it used to,” he said. “I remember when I was a young professional in the ’80s and that was the hot spot.”

For Sandvick Architects, the project is personal, Dornback said. Of the historic structures that founder Jonathan Sandvick has

12 | CRAIN’S CLEVELAND BUSINESS | OCTOBER 16, 2023

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touc clos spir and she L bro leas inqu ants into from ind inex T mer zled “W pro som ing vac just an thro ket.”

Th Dow com dow reta Tha ativ non nom staff “Th she rein mu

Two historic hotels might soon change hands Sale considered for Hyatt Regency Cleveland at the Arcade and Renaissance Cleveland Hotel

By Michelle Jarboe

ead

ARBOE

5th

role plan erm d to wn-

has more d. “I ung that

the ack that has

touched, the Arcade is probably closest to his heart. “We just have a spiritual respect for the building and a passion to see it succeed,” she said.

Lauren White of Colliers, the brokerage responsible for retail leasing at the Arcade, gets steady inquiries from prospective tenants. But few of those calls turn into leases, she said. Many come from small business owners and individual entrepreneurs seeking inexpensive space.

Two deals on Euclid, at the former Chocolate Bar restaurant, fizzled last summer.

“While retail leasing at this property . . . has always been somewhat of an intricate balancing act, the challenges to fill the vacant spaces are not specific to just this building,” White wrote in an email. “We are seeing this throughout the downtown market.”

The consultant that worked on Downtown Cleveland Inc.’s forthcoming retail plan found that downtown has too many indoor retail spaces, relative to demand.

That means “we need to get creative,” said Audrey Gerlach, the nonprofit’s vice president of economic development and chief of staff.

“The Arcade is a cultural icon,” she added, “and this project would reinforce its relevance to the community.”

The owner of two historic downtown Cleveland hotels could exit this market next year.

Skyline Investments Inc., the Toronto-based owner of the Hyatt Regency Cleveland at the Arcade and Renaissance Cleveland Hotel, is considering the sale of its entire U.S. portfolio, CEO Blake Lyon confirmed in an interview with Crain’s.

The potential deal looms as Skyline finishes a major renovation at the Renaissance and considers new ways to fill storefronts at the Arcade.

“We are engaged in discussions with a group that wants to buy all of our hotels in the U.S., which would include the Hyatt and Renaissance,” Lyon said. “We haven’t indicated a buyer at this point.”

The publicly traded company, whose shares are listed on the Tel Aviv Stock Exchange, has focused recently on suburban, select-service hotels instead of full-service properties such as the Renaissance and the Hyatt. But Lyon said the current sale talks aren’t motived by that strategic shift. Instead, Skyline received an unsolicited offer for its U.S. properties.

“I said no a couple of times,” he said. “At some point, we just got to a number where we couldn’t ignore it. That’s what got us to where we are today.”

At this point, he said, a sale could take place during the first quarter of 2024. But nothing is certain in a challenging commercial real estate landscape, with higher interest rates, tightened lending standards and the increased complexities of getting deals done, Lyon cautioned.

Skyline entered the U.S. in early 2012, when it bought the Arcade out of foreclosure for only $7.7 million. In regulatory filings, the company puts the value of the property at $71.7 million.

The company acquired the Renaissance in 2015 and owns it through a joint venture with a silent partner. Skyline’s financial statements mention a value of about $62 million for the 491-room property, which is transforming into an independent hotel as part of Marriott’s Autograph Collection. Most of the renovation work should be finished by the end of this year, Lyon said.

Once the project is done, the Renaissance will become the Hotel Cleveland, in a return to its original name. The building, downtown’s second-largest hotel, opened in 1918.

Skyline’s U.S. portfolio also includes 14 Courtyard by Marriott hotels scattered across 10 states.

Two are in Ohio, outside Dayton and Toledo.

Alexandre Duong, a senior managing director of investments in the national hospitality group at the Marcus & Millichap brokerage, said full-service hotels are a tougher sell than their smaller counterparts with more limited amenities.

But he’s seeing more full-service hotels hit the market now, after a pandemic-induced pause and the slow resurgence of business travel.

As in other areas of the com-

Skyline Investments Inc. acquired the Renaissance in 2015 and owns it through a joint venture with a silent partner. The hotel is being renovated as part of a transformation into an independent hotel that will be part of Marriott’s Autograph Collection. | PHOTOS BY MICHELLE JARBOE

mercial real estate market, though, pricing is a hurdle.

“The sellers are kind of stuck on 2022 pricing,” said Duong, who is based in Northeast Ohio. “It’s a stark contrast in the nine months of this year, where interest rates are right now. . . .A lot of deals go to contract and fall out.”

For large portfolios, he added, there’s a small pool of potential buyers.

In a case like Skyline’s, the likely suitor is a real estate investment trust — and a company attracted to the suburban Courtyard hotels instead of the Cleveland assets, said David Sangree, the president of Hotel & Leisure Advisors, a hospitality consulting firm based in Lakewood.

He hadn’t heard about Skyline’s recent disposition talks. But Sangree wasn’t surprised.

“They had tried to sell a few years ago. . . .This owner, that’s the type of business they’re in, when they can get a reasonable price for something,” he said.

Though higher interest rates make it difficult for buyers and sellers to agree on values, the overall state of the hotel market has improved significantly. Data from CoStar Group show that occupancy in Cleveland is near pre-pandemic levels. And room rates are climbing.

In September, downtown-area occupancy was 73.2%, up 7.2% from a year before, based on preliminary figures from CoStar. The

average daily rate was $208.96, a 3.7% annual increase. By all measures, downtown outperformed the metropolitan area last month.

A recent survey by Cheaphotels.org found that Cleveland had the fourth-highest asking room rate in the country for October, based on centrally located properties with at least a three-star rating. The average rate here was $234. Only Boston, New York City and Austin were pricier.

Sangree pointed to the large number of events taking place downtown this month.

“It’s taken a little longer than some downtowns to catch up, but it seems that it is finally catching up now that business travel is improving and demand is growing nationwide,” he said. “So now we’re back to where we were before COVID.” Eric Hansen, a director with LW Hospitality Advisors in Westlake, said that downtown hoteliers are expecting a banner 2024, buoyed by conferences and the expansion of the Huntington Convention Center of Cleveland. And he sees plenty of upside opportunities for investors.

“There’s a lot of cash on the sidelines, and the players that can actually get things moving have the ability to take advantage of things,” Hansen said.

Skyline’s occupancy and rates in Cleveland are down from last year, but that’s largely due to taking half of the Renaissance’s rooms offline for renovations. The company already updated the rooms at the Hyatt, except for four suites, Lyon said. Those suites, along with the lobby and the hotel’s 1890 restaurant, are set for a makeover during the winter.

“Both of these are marquee assets, the Hyatt with the Arcade and the history there and the Renaissance, with its location and switching to the Autograph,” Lyon said. “Whenever you have a good asset, it doesn’t really matter the market.”

OCTOBER 16, 2023 | CRAIN’S CLEVELAND BUSINESS | 13

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CRAIN'S LIST | ACCOUNTING FIRMS Ranked by number of CPAs in Northeast Ohio as of Sept. 1, 2023 LOCAL CPAS 9-1-2023 1-YEAR CHANGE

FULL-TIME LOCAL STAFF 9-1-2023 2022 REVENUE 1-YEAR CHANGE (MILLIONS) 1

& YOUNG LLP 1 ERNST 950 Main Ave., Cleveland 44113

335 -2.0%

1,246 -14.2%

LLP 2 PWC 200 Public Square, Cleveland 44114

174 e -1.1%

& CO. 3 COHEN 1350 Euclid Ave., Cleveland 44115

LOCAL PERSONNEL ENGAGED IN AUDITACCOUNTING

TAX

CONSULTING

OTHER

TOP LOCAL EXECUTIVE(S)

—

346

140

234

526

Monte Repasky, Cleveland office managing partner Aaron Swartz, Akron office managing partner

— —

—

—

—

—

—

Gregg Muresan, Cleveland office managing partner

162 -0.6%

355 2.9%

—

106

121

36

92

Christopher Bellamy, CEO

LLP AND SUBSIDIARIES 4 DELOITTE 127 Public Square, Cleveland 44114

134 4.7%

614 4.8%

—

219

110

211

37

Fiona Chambers, Northeast Ohio managing partner

LLP 5 KPMG 1375 E. Ninth St., Cleveland 44114

85 -5.6%

193 -3.5%

—

63

28

70

32

James Mylen, Cleveland managing partner

SIEGFRIED GROUP LLP 6 THE 950 Main Ave., Cleveland 44113

75 2.7%

83 1.2%

$456

0

0

0

75

Brian Seidner, managing director, Lake Erie Markets Cleveland, Columbus, Pittsburgh, Toledo

& MOORE 7 MEADEN 1375 E. Ninth St., Cleveland 44114

70 0.0%

157 3.3%

$46

60

51

15

31

James Carulas, CEO

LLP (CLA) 8 CLIFTONLARSONALLEN 4334 Munson St. N.W., Canton 44718

68 -5.6%

96 0%

$1,663

32

36

13

15

Dane Mayle, office managing principal

LLP 9 MARCUM 6685 Beta Drive, Mayfield Village 44143

56 1.8%

172 1.8%

$1,218

33

52

66

34

Dani Gisondo, regional managing partner - Ohio

MARKEY, FEDOROVICH & CO. 10 BOBER, 3421 Ridgewood Road, Akron 44333

56 5.7%

103 4%

—

40

35

10

18

Mark Bober, Steve Swann, Theodore Wagner, partners

US LLP 11 RSM 1001 Lakeside Ave. E., Cleveland 44114

55 -8.3%

216 -4%

$3,709.1

57

30

92

38

David Andrews, Ohio market leader

& ASSOCIATES 12 REA 6300 Rockside Road, Independence 44131

53 -10.2%

152 16.9%

—

33

71

24

24

Paul Gregory, regional president, Northeast Ohio

USA 13 BDO 1300 E. Ninth St., Cleveland 44114

53 -13.1%

142 -9.6%

$2,822.6

46

59

15

32

Dave McClain, tax practice leader Teri Schaffer, assurance practice leader

BELL LLC 14 PEASE 1111 Superior Ave. E., Cleveland 44114

51 4.1%

132 22.2%

—

49

56

5

22

Kuno Bell, managing partner

THORNTON LLP 15 GRANT 200 Public Square, Cleveland 44114

50 13.6%

118 18%

—

47

33

25

13

John Barnes, office managing partner

MORAN 16 PLANTE 1111 Superior Ave., Cleveland 44114

49 0.0%

82 13.9%

$1,009.8

35

25

14

8

Daniel Hursh, office managing partner

+ NOVOTNY LLC 17 MALONEY 1111 Superior Ave., Cleveland 44114

48 2.1%

106 1%

$24.8

50

28

12

16

Jon Ruple, managing shareholder

GROWTH PARTNERS 18 APPLE 1540 W. Market St., Akron 44313

47 2.2%

93 -5.1%

$20.1

18

42

5

25

Erica Ishida, president

19 HW&CO. 23240 Chagrin Blvd., Beachwood 44122

44 -8.3%

84 0%

$21

43

13

22

0

Brandon Miller, president, CEO

BARTH & KING LLC (HBK CPAS & 20 HILL, CONSULTANTS)

43 7.5%

122 1.7%

$143

27

36

18

41

Phillip Wilson, COO, principal/quality control

INC. 21 CBIZ 6801 Brecksville Road, Independence 44131

42 7.7%

339 2.7%

$1,412

21

26

85

207

Jerome Grisko Jr., president, CEO

KRAUSE 22 CORRIGAN 191 American Blvd., Westlake 44145

37 0.0%

95 5.6%

$15.3

39

27

6

23

Thomas Harrison, president, CEO

WENDLING CPAS INC. 23 BARNES 1350 Euclid Ave., Cleveland 44115

37 5.7%

74 -3.9%

—

23

29

3

19

Jeffrey Neuman, director, president

LLP 24 SIKICH 274 White Pond Drive, Akron 44320

29 0.0%

115 -4.2%

$316.4

28

20

52

15

Jason Tuma, Northeast Ohio market lead

GROUP (415 GROUP) 25 FOUR-FIFTEEN 4300 Munson St. N.W., Canton 44718

27 -10.0%

85 3.7%

$15.9

19

31

26

9

Richard Craig, managing partner

RANK

COMPANY MAIN LOCAL OFFICE

216-861-5000/ey.com

216-875-3000/pwc.com

216-579-1040/cohencpa.com

216-589-1300/deloitte.com

216-696-9100/home.kpmg/us

216-912-1342/siegfriedgroup.com

216-241-3272/meadenmoore.com

330-497-2000/claconnect.com

440-459-5700/marcumllp.com

330-762-9785/bmf.cpa

216-523-1900/rsmus.com

216-573-2330/reacpa.com

216-325-1700/bdo.com

216-348-9600/peasebell.com

216-771-1400/grantthornton.com

216-523-1010/plantemoran.com

216-363-0100/maloneynovotny.com

330-867-7350/applegrowth.com

216-831-1200/hwco.cpa

6603 Summit Drive, Canfield 44406 330-758-8613/hbkcpa.com

216-447-9000/cbiz.com

440-471-0800/corrigankrause.com

216-566-9000/barneswendling.com

330-864-6661/sikich.com

330-492-0094/415group.com

Information is from the companies unless footnoted. Firms with the same number of local CPAs are then ranked by local full-time employees. NOTES: e. Crain's estimate. 1. Revenue in most cases excludes revenue from separately owned firms that share the same brand name.

Get all 34 firms and more than 125 executives in Excel format. Become a Data Member: CrainsCleveland.com/data 14 | CRAIN’S CLEVELAND BUSINESS | OCTOBER 16, 2023

P014_CL_20231016.indd 14

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By Dan Shingler

The choice of Heidi G. Petz to become the next CEO of Sherwin-Williams came as no surprise to at least some who follow the company closely.

And that, they say, is a good thing.

Analysts say they expected Petz to be tapped as the company’s new leader because they expected Sherwin-Williams to do what it’s always done: implement solid long-term succession planning to keep the company running smoothly.

“That tends to be the pattern at Sherwin-Williams,” said Chuck Cerankosky, an analyst and managing director of Northcoast Research in Cleveland. “This is a company I’ve followed since 1985 and I’ve always said it’s the best-managed company I’ve ever followed. . . .This company has always planned well, in my opinion — thinking ahead, thinking strategically.”

Similarly, Longbow Research president and senior analyst David MacGregor said he was not at all surprised to hear that Petz will be running the big paint and coatings company beginning at the start of next year.

“She’s been the heir apparent for quite some time and is a very capable executive,” MacGregor said. “I think it’s going to be a fairly smooth transition.”

MacGregor and Cerankosky said Petz’s experience running Sherwin-Williams’ America’s Group and, before that, its Consumer Brands Group have likely prepared her well to run the company’s overall business. In those two roles, Petz dealt with major challenges, such as the supply-chain problems that arose out of the COVID-19 pandemic and the ongoing issue of rising inflation.

While the supply-chain issues have largely abated, inflation continues to be a challenge and one that Petz will face when she takes the reins, Cerankosky said.

“You have the challenge of inflation because this time around, which is unlike when interest rates were going up in 2018-2019,” he said. “That was due to economic growth, and now we have an interest-rate spike due to inflation. . . .

And as that impacts consumers, it has an impact on demand for a lot of products that need coatings, and that includes housing.”

Rising interest rates that slow

housing starts are a challenge because even though Sherwin-Williams has a robust consumer business, it relies on homebuilders and other contractors for a good chunk of its sales, Cerankosky said.

That said, the company’s competitors are facing the same headwind, and Cerankosky thinks Sherwin-Williams will come out on top.

“It’s not unique to Sherwin-Williams, but Sherwin tends to take these opportunities and uses them to gain market share,” Cerankosky said.

Sherwin-Williams is better positioned to maintain its marketing and other sales efforts through a downturn, he reasons. It also has a broad array of products, some of which it can market as values that are more inexpensive than some competitors, while others can be marketed as doing a better job of protecting the assets they coat, Cerankosky added.

“Probably, because of the company’s large volumes, they can spread marketing costs over a larger number of gallons (of paint sold),” he said.

Also of note is that Petz is the first woman to hold the top job at

BLOOMBERG

Petz is well-prepared to face the challenges ahead, analysts say

Sherwin-Williams.

But again, that wasn’t surprising to MacGregor nor Cerankosky.

She was simply the best person for the job, so they expected her to get it, they said.

That said, Petz now joins a growing list of senior female executives running large corporations and institutions, ranging from Carey Jaros at GOJO Industries in Akron to Tricia Griffith at Progressive Insurance and even Loretta Mester at the Federal Reserve Bank of Cleveland.

“It’s a nice thing to see,” MacGregor said. “It’s all about putting the best person in the seat.”

Petz will take the helm with a nice wind behind her — and one that is likely at least partly of her own making. Sherwin-Williams has been outperforming market expectations as of late, and ap-

pears poised to continue to outperform its peers, according to Bloomberg analysts Sean Gilmartin and Jason Miner.

“Sherwin-Williams is proving adept at navigating a 2023 demand environment and appears poised to deliver a solid (second half of 2023) despite challenging yearover-year comparisons and volume headwinds in new residential and North American industrial,” the two wrote Wednesday, Oct. 11, the day Petz’s ascension was announced.

Sherwin-Williams is benefiting from raw material costs that are finally dropping, Gilmartin and Miner wrote. That should help maintain margins, they added, but the real challenge will be maintaining volume in an environment where higher interest rates are cutting into architectural sales.

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SURFACES From Page 1

Outgoing Sherwin-Williams CEO John Morikis stands next to future CEO Heidi Petz, who will take the helm at the global coatings company on Jan. 1. | THE SHERWIN-WILLIAMS CO.

PETZ From Page 1

Petz, 48, moved to the Cleveland area from Chicago in 2018.

Since then, she has scaled the ranks at Sherwin-Williams, where succession planning can be a years-long — or even decades-long — exercise. Past chief executives have held the top job for anywhere from eight to 39 years.

“I’d be remiss not to say this,” Petz said Oct. 11, sitting side-byside with Morikis. “It is so humbling to be coming in as the 10th CEO of a 157-year-old company.

And what gives me so much confidence is not only the legacy that John is leaving, that Chris (Connor) left before him, but the depth of the experience of the leadership team around me.”

Morikis will stay on as executive chairman for an undetermined time. That’s the same process Sherwin-Williams followed in 2016, during the company’s last CEO handoff.

“She’s not getting rid of me,” he joked. “When she’s ready, she can get rid of me.”

The company’s board of directors approved the pending transition on Tuesday, Oct. 10. The board also increased its size to 11 members, creating a seat for Petz.

In a regulatory filing, Sherwin-Williams said Petz will receive a base salary of $1.3 million, along with cash incentives and stock options.

Morikis’s compensation will not change.

At 60, Morikis said it’s the right time to cede the stage. He’s worked at Sherwin-Williams since 1984 when he joined the company as a management trainee in its paint stores group.

“I’m ready. The company’s ready. And Heidi’s ready,” he said.

“And I have tremendous confidence and an overwhelming, almost, admiration for what she does.”

Petz describes her leadership style as aggressive, transparent and candid. Morikis said she’s collaborative – and decisive, a key trait in successful CEOs. That decisiveness was critical during the pandemic when Sherwin-Williams had to move quickly and make tough calls, including choosing which customers and markets to serve.

“Some of our competition, in this uncertainty, they froze,” Petz said. “Or they would shut down stores. Or they didn’t know how to

operate. And we went right at it with our customers. If success is our customers are with us on the other side, I would say we were successful.”

Now the company, which had a better-than-expected first half of 2023, faces additional headwinds.

There’s inflation. Economic uncertainty. And a persistent labor shortage.

Petz believes the new Sherwin-Williams facilities, set to be finished in late 2024, will give the company an edge in hiring and retention. The downtown project includes a 36-story office tower and a two-story pavilion just west of Public Square. It will replace an Art Deco complex on Prospect Avenue where Sherwin-Williams employees are spilling out at the seams.

The future research and development center is in Brecksville.

Employees will move there from older facilities downtown and in the suburbs.

“There is a war on talent,” Petz said. “So we do believe that we need to give people a really good reason to come in. We’re being really deliberate about the workplace environment, amenities and collaboration areas, so that it feels like a new day coming into the office.”

Sherwin-Williams has 64,000 employees globally and approximately 4,000 employees in Northeast Ohio. Cleveland, Brecksville, Cuyahoga County and the state pledged incentives to the company in 2020 to keep its headquarters and research operations in the region.

Petz, whose father was a tire industry executive, remarked on how much the Cleveland area has changed and grown since her early childhood in Akron. She and her family now live on the West Side, where she spends off-work hours dashing between sports and other activities.

“Home is back here,” she said.

“And it’s nice to be back. ... I look at all that we have to offer here in Cleveland, and I’m really proud that Sherwin-Williams has been a pillar of this community and will continue to be an important pillar of this community going forward.”

Morikis echoed that. “Cleveland is important to Sherwin-Williams, and Sherwin-Williams wants to be important to Cleveland,” he said.

“We want to fill the pipeline of opportunity in this community because we know it will help Cleveland. But it will also help Sherwin-Williams.”

The surface.

Specifically, artificial turf, which many NFL players believe contributes to a much higher rate of non-contact, lower extremity injuries than natural grass.

In September of 2020, NFL Players Association president J.C. Tretter — then a center for the Browns — called for all NFL teams to change their playing surfaces to natural grass, even penning an essay on the NFLPA site headlined, “Only natural grass can level the NFL’s playing field.”

NFL players have since echoed those complaints, and the debate reached its crescendo on Sept.

11, when Jets quarterback Aaron Rodgers tore his Achilles tendon on the synthetic turf at MetLife Stadium.

Soon afterward, Rodgers’ former Green Bay Packers teammate, David Bakhtiari, posted on X (formerly Twitter): “How many more players have to get hurt on ARTIFICIAL TURF??!” and “Can we put an end to this (bleep) already?”

But here’s the thing. A day earlier, the Baltimore Ravens’ 24-year-old running back, J.K. Dobbins, tore his Achilles during a game against the Houston Texans. That injury happened on grass.

Guess which one caused an outcry?

“Two high-profile athletes — one of them almost 40 years old, one of them (24) — tear their Achilles,” Dale Karmie said. “One was on natural grass. One on turf.

Only one of them gets the news.”

His conclusion?

“I think we’re dealing with a false narrative,” he said.

Before you say, “Of course the guy who runs a synthetic turf company is going to defend turf,” consider this. A third-party company called IQVIA recently studied the issue for the NFL and the NFLPA and found that the NFL’s rate of non-contact injuries to the knee, ankle and foot in 2021 and 2022 was essentially the same on natural and artificial playing surfaces.

That wasn’t always the case.

Tretter’s essay cites a 2012-2018 study showing turf injuries were more prevalent, something that continued for the 2019 season.

But the difference began narrowing in 2020, IQVIA’s study found.

By 2021, artificial surfaces had an incident rate of .042 per 100 in 2021, while the rate for natural surfaces was .041 per 100.

“But sometimes one tweet from a player speaks louder than the research,” Brian Karmie said.

“That’s the world we live in, soundbites and snippets.”

Two days after Rodgers’ injury, NFL commissioner Roger Goodell went on ESPN’s “First Take” to defend synthetic surfaces, saying the league will rely on scientific evidence, not anecdotal evidence, for its field policies.

“We want to give our players the best possible surface to play on,” he said. “That can’t be done by my feeling at looking at a par-

Ca ins Tom in ho be

ticular injury. It’s got to be done with a real process. You have to look at it with medical experts.

Look at it with engineers. Look at it with people on the cleats. Look at every aspect of what can go into that injury, including the training and where a particular player is at any given time.”

Fifteen NFL stadiums have natural grass, including Cleveland Browns Stadium, which uses Kentucky bluegrass. (Most grass stadiums use Bermuda.) The Browns have played on grass dating back to Municipal Stadium, “and we’ve never really considered changing,” said Phil Dangerfield, the Haslam Sports Group’s vice president of operations.

“We’re really happy with natural grass.”

The NFL’s other 15 stadiums — including MetLife and SoFi Stadium, which each have two NFL teams — use synthetic turf, typically FieldTurf.

While most dome or retractable roof stadiums use turf, there are two that use natural grass: State Farm Stadium (home of the Arizona Cardinals) and Allegiant Stadium (Las Vegas Raiders).

Both use a retractable field tray, where the grass is grown

outdoors and rolled inside on game days. And both stadiums have had issues with slippery turf, something that came to a head during last year’s Super Bowl at State Farm Stadium.

The NFL spent two years and $800,000 growing a new Bermuda/rye grass hybrid at a nearby Scottsdale sod farm specifically for the game and ended up with a field that had worse traction than Dennis Kucinich’s presidential bid.

“I’m not going to lie, it’s the worst field I ever played on,” Philadelphia Eagles defensive end Haason Reddick said afterward.

Consequently, it’s hard to make a blanket statement like “Grass is better” or “Turf is better,” the Karmies said. The grass field at Acrisure Stadium is notoriously bad late in the year, in part because the Steelers share their stadium with the University of Pittsburgh. The turf at Chicago’s Soldier Field is as bad as the team that plays on it. Plus, the shoes can matter as much as the surface, since the length and the design of the cleats often dictates whether a player slips or sticks in the ground.

And while every synthetic turf

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field tho upd suc Kar “Th dard Ju NFL eve inst Can Fam that field righ who min B use spri Jets has som stad Min mu rub Kar stab “I he s an brak form

FOREVERLAWN PHOTOS

Some are safer than others. Some drive faster, corner better, accelerate quicker.

“Turf is no different.”

Is he confident his best product would beat grass?

“You’re asking us to compete against God,” he said, laughing.

“That’s tough. But when you add in the element of weather, of rain, of potential divots and things that can happen on natural grass, I think we’d be right there.”

Of course, turf companies aren’t the only ones innovating.

The Browns use a combination of technologies to maintain the surfaces in Berea and at Cleveland Browns Stadium, including SubAir (which delivers fresh air to the roots and subsoil) and Hydronic Canton-based ForeverLawn temperature control (which installed new SportsGrass turf at keeps the soil from getting too Tom Benson Hall of Fame Stadium hot or cold). in the spring of 2023. The stadium Those technologies help the hosted the Hall of Fame Game grass recover quicker while exbetween the Browns and Jets. tending the growing season, which is critical in a cold-weather city such as Cleveland.

“We’re fortunate to have a realon field has to pass certain tests, and ums those standards are always being ly qualified set of experts oversee pery updated and refined, there are no our grounds,” Dangerfield said. o a such standards for turf, Dale “They do a phenomenal job and it has given us the ability to keep per Karmie said.

“There are no tests, no stan- natural grass fields.”

Still, there are limits. The and dards, no limits,” he said. muJust as the grass differs among Browns use synthetic turf in their arby NFL cities, so does the turf. For- indoor facility — ForeverLawn ally everLawn, for instance, recently will be replacing that surface in th a installed new SportsGrass Max at the next year or two — and the han Canton’s Tom Benson Hall of stadium grass will always be at ntial Fame Stadium, “and I’d argue the mercy of Mother Nature, parthat it’s markedly better than any ticularly late in the year when the the field that’s in an NFL stadium weather turns.

The Browns would like to host hilright now,” said Dale Karmie, end whose company is located 15 more non-football events at the stadium, but “we have ongoing d. minutes away, in Louisville. to Benson’s turf — which was discussions in our organization like used by two USFL teams in the about how those events will imbetspring and by the Browns and pact our field,” Dangerfield said.

High schools and colleges rass Jets in the Hall of Fame Game — otohas a shock pad underneath, don’t have that luxury, nor do , in something only one other NFL they have the money or the rehare stadium (U.S. Bank Stadium in sources to keep a grass field at the rsiMinnesota) has. ForeverLawn’s NFL standard. That’s why the Chimulti-fibered system uses less NFL’s field debate it’s unlikely to d as rubber infill and more sand, Dale trickle-down to the lower levels, lus, Karmie said, making it soft and where approximately 2,500 turf fields are installed each year. h as stable.

“At Cleveland Stadium, they and “I like to compare turf to cars,” diche said. “All cars have four tires, play at most 30 hours of football a s or an engine, a steering wheel and year,” said Joe Bogdan, the direcbrakes. They all drive. Some per- tor of facilities at Canton City turf form differently than others. Schools, which uses Benson Stadium for Canton McKinley’s home football games. “Between practices and games, we have 30 hours of use in a week and a half.”

Before Bogdan took the job in Canton, he was the athletic director at East Canton High School, which had a grass field at its football stadium. East Canton didn’t have a soccer team, but it did play freshman, JV and varsity football games on the grass field, “and we worried about rain or playing two POSITION AVAILABLE weeks in a row at home,” he said.

“Once it gets muddy and you lose Crain’s Career Center jobs.crainscleveland.com Keep your career on the move. Create a job seekerit, profile. you’re not getting it back until the Job titles appearing on jobs.crainscleveland.comnext spring. It’s not happening.”

Director, Ansifield-Wolf Book Awards (AW) After leaving East Canton, he Director, PR & Communications took the athletic director job at Uniontown Lake, which purDirector of the Center for RNA Science and Therapeutics chased one of ForeverLawn’s first Your next career opportunity is right at your fingertips with Crain’s Career Portal! turf fields. That field had some isl Search and apply to top jobs with organizations that value your credentials sues, “but they continued to l Upload your resume so employers can find you change the product and innol Create job alerts and receive an email each time you match. vate,” Bogdan said. “Then they l Access career resources, job searching tips and tools. worked with the NFL to put the turf in at Benson and we’ve had

zero complaints. I think it performs really, really well. It’s as good as any other synthetic turf I’ve been around.”

Dangerfield also praised the Benson turf — ”The NFL was really happy with it,” he said — and New Jersey Generals GM Billy Devaney told the Karmies it was the best field he’s ever seen.

“That was nice because turf is like the officials,” Brian said. “Nobody reaches out to say how good the officials were in the game.

You only hear about it if there is a problem.”

ForeverLawn has five business verticals — landscape, playgrounds, canine grass (for dog parks), golf greens and SportsGrass — and only about 15-20% of its business comes from playing fields. But SportsGrass is its most visible product, and its fastest-growing market.

“We did maybe one field a year for a decade, and part of the reason was because it was generally a bid market,” Dale Karmie said.

“Once you met the minimum standard (for quality), they were going to take the lowest bid if it’s public money. That’s not where we perform. We’re a high-quality product with a high-quality install, and we cost a little more.”

For some customers, that’s a non-starter — and not just at the lower levels. NFL teams will spend $1 billion (or more) on their stadium and cut corners on the turf, Dale Karmie said.

“I want to be careful here, because I don’t want to throw other companies under the bus,” he said. “But even some of the new systems being installed are old technology. “(Bengals quarterback) Joe Burrow talked about how each stadium has different turf and how there should be a set standard. I understand the intention there. But I think it’s wrong. If everyone has a designed standard, you never have innovation. Nothing gets better.”

Consequently, Brian Karmie would like to see the NFL lead the way on the turf debate, believing that if the quality improves at the professional level, it’ll trickle down to everyone else.

“The turf can continue to get better,” he said. “With concussions, they studied the helmet and the helmet got better. In NASCAR, they’ve made those cars better and safer. Turf is the same way.”

One more thing. While improving turf and grass surfaces is a worthy goal, it won’t change the fundamental nature of the NFL. Both Rodgers and Dobbins tore their Achilles while being tackled. Fitzpatrick’s hit on Chubb tore his MCL and stretched his ACL, and there was little that the grass, or Chubb’s cleats, could have done to prevent that.

“Football is a violent sport played by incredible athletes that are strong and fast and fire their bodies into each other,” Dale Karmie said. “Injuries are going to happen.”

Can you still blame the playing surface for what happened to Rodgers? Maybe.

But it sure seems like shaky ground.

NONPROFITS From Page 6

there are a dozen more mergers like this that need to happen to sharpen the system and stop organizations from competing and confusing clients, donors and volunteers.

M&A is everywhere in private industry because businesses, more often than not, benefit from scale, combined services and synergies.

The same is true for nonprofits, but it takes a tremendous amount of courage, hope and humility to initiate a combination when there isn’t a purchase price to sweeten the pot.

Combinations can make us better and stronger, and we need more of them in Cleveland’s nonprofit sector. Less duplication, more impact.

Less competition, more leadership.

Less red tape, more impact.

And if we can’t (or won’t) combine, at the very least we need to enter a whole new era of radical collaboration. We are exponentially stronger when we put politics and self-interest aside and come together in powerful partnerships such as these: ◗ The Greater Cleveland Career Consortium brings together public, private, education and nonprofit organizations to help every student in the region design a career path. ◗ Cuyahoga’s Workforce Connect Sector Partnership that brings together dozens of companies including manufacturers, IT companies and health care organizations with groups such as the Urban League, Ohio Means Jobs, Towards Employment, Nordson

Foundation and many others to launch innovative programs to get people into great careers. ◗ The Cleveland Foundation, JumpStart and MidTown partnering with the community, MAGNET, University Hospitals, the Cleveland Institute of Art and others to establish a thriving hub of research, manufacturing technology and inclusive entrepreneurship in the new MidTown Collaboration Center. ◗ Team NEO pulls together the leaders of industry clusters like the Cleveland Water Alliance, BRITE Energy Innovators and the Greater Akron Chamber’s Polymer Industry Cluster. ◗ Case Western Reserve University and the Greater Cleveland Partnership rallied together dozens of organizations to win a $1 million first-round National Science Foundation planning grant to make Cleveland a hub of sustainable manufacturing.

This is what I call radical collaboration. And it’s the only feasible way to reinvent the nonprofit ecosystem that’s valiantly trying to fix some of Northeast Ohio’s most intractable community problems and propel us into a collectively brighter future.

Gone are the days when working in our isolated kingdoms works, if it ever did. Connection is the modern currency of impact.

Those of us who do this work do it for one reason. It’s not just about economic development. It’s because we know that if we get things right, we can make life better for everyone who lives here. So, let’s cut the red tape, collaborate, consolidate and get it right.

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Cavs, Browns announcer makes Cleveland broadcasting history

By Joe Scalzo

CHUUUUUUBB! HASTA LA VISTA, BAYYYYBEEE! NICK CHUUUUUUB, The most iconic call of Rafael TOUCHDOOOOOOWWWNNNN!” Hernandez-Brito’s call went viral “Rafa” Hernandez-Brito’s broadcasting career — at least when it and was even retweeted by the comes to Cleveland Browns games chairman of the FCC, which isn’t as — came in 2018, when Nick Chubb fun as it sounds.

“I was worried,” he said, laughbroke off a 92-yard touchdown run ing. “I was like, ‘Why is the through the middle of the chairman of the FCC lisAtlanta Falcons’ defense. tening to my broadcast?’”

On the FOX broadcast, Hernandez-Brito also Kenny Albert’s call started had mixed feelings about well — “On second down everyone else’s reaction, it’s Chubb! Nick Chubb since he always wants to across the 40! One man to be judged by the content beat!” — but, unlike of his calls, not just the Chubb, Albert lost steam volume. Yes, he brings a over the last half, finishing lot of passion to big mowith something more run- Rafael “Rafa” ments, but he’s also someof-the-mill: “Chubb will Hernandez-Brito one who grew up idoliztake this all the way. Ninety-two yards for a Browns touch- ing broadcasters like Jim Nantz down. The longest run in Cleveland and Bob Costas, announcers who excel at storytelling across many Browns history.”

Hernandez-Brito did not have different sports.

“Sometimes people will send me that problem.

As Chubb hit top gear just past a play in Spanish and say, ‘Oh, my midfield, the Spanish-language god, this is the best thing I’ve ever broadcaster belted out, “NICK heard!’” Hernandez-Brito said. “And

I always say, ‘I wish I could translate it to you in English, so you can tell me if you just like it because of the screaming.’

“I enjoy the storytelling. I enjoy getting people involved in the game. I have the luck of watching the game with a mic on, so the least I can do is tell a good story. But, yes, I am a little louder than (Cavs playby-play man) John Michael and other broadcasters. That’s what the difference is. We (Spanish broadcasters) just see things a little louder than normal.”

Hernandez-Brito is entering his 10th year calling the Cavaliers’ Spanish broadcasts, which are available over the air on WNZN-FM 89.1 and via streaming on La Mega Cleveland. He’s also back broadcasting Cleveland Browns games for the first time since the pandemic, working with analyst Octavio Sequera on La Mega Cleveland and WNZN. Hernandez-Brito even teamed with Carlos Baerga on a handful of Guardians broadcasts this summer,

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The Browns’ and Cavaliers’ Spanishlanguage broadcaster, Rafael “Rafa” Hernandez-Brito, poses with a Cavs flag atop Mount Kilimanjaro. | CONTRIBUTED

and is believed to be the first broadcaster to call all three Cleveland professional sports teams in the same year.

He was even on the mic for the first Spanish broadcast for the Cleveland Monsters in 2021, and has since called another Monsters games and worked as the public address announcer two other times.

“I’m just happy to be in Cleveland,” he said. “I’m just thrilled about the city, the people and the organizations. I always say they treated me better than Univision, which is Hispanic-owned and operated. It’s the best move I ever made in my life. I want to be here for as long as I can make it and continue to see if I can provide some help to the community.”

Career path Hernandez-Brito grew up in war-torn El Salvador and arrived in America at age 16, joining his aunts in Long Island. He earned a mechanical engineering degree from Boston University and dreamed of building jet engines, but pivoted to sales when he couldn’t get national security clearance because he wasn’t yet a U.S. citizen.

He got a job with Coors, counting Madison Square Garden and Yankee Stadium among his accounts, but had an “Aha!” moment during Game 1 of the 1988 World Series, when he heard Jack Buck’s famous “I don’t believe what I just saw!” call of Kirk Gibson’s home run off Dennis Eckersley.

“I was like, ‘Man, that’s what I was thinking!’” he said.

It took about a decade, but Hernandez-Brito eventually went back to school for broadcasting, then started calling St. John’s basketball games immediately after graduating. He rose through the radio ranks quickly, eventually becoming the first Spanish syndicated broadcaster to call a Super Bowl, World Series, NBA Finals and men’s Final Four. He spent eight years as the voice of NFL football for Spanish broadcasts across Thursday Night Football, Sunday Night Football, Monday Night Football and the NFL playoffs, even

calling 11 Super Bowls on Univision.

“It meant a lot to work those games, but I was never personally invested,” he said. “I’m a Jets fan and they lost in two AFC championship games, so it was really like, ‘Oh my god, my team is in the Super Bowl’ or anything.”

That changed in 2014, when he moved from South Florida to Cleveland to become the Cavaliers’ play-by-play announcer, right at the time when LeBron James was making a similar decision. Two years later, he was on the microphone when the Cavs ended the city’s 52-year championship drought.

“That championship meant so much to me,” he said. “When I came to the Cavs in 2014, there were so many good reasons to come and it felt like the right time to be invested in a team. I had no idea how great the organization was at the time, but it turned out to be the best thing I’ve ever done in my life.”

The bilingual Hernandez-Brito is especially proud of his work connecting the Cavaliers with the city’s Hispanic community, noting the team was promoting diversity, equity and inclusion years before it was in vogue.

“My grandmother used to say, ‘When you get out of a hole, make sure you throw the rope back down,’” he said. “It feels great to pay it forward.”

Mountain man While Hernandez-Brito has reached just about every height in his profession, he realized this summer there was still one mountain left to climb.

A literal one.

When Hernandez-Brito’s older brother, Carlos, retired in 2022 after a 35-year career at J.P. Morgan, he mentioned his Bucket List included climbing Mount Kilimanjaro, the highest mountain in Africa at nearly 20,000 feet. Hernandez-Brito joined Carlos, his brother Benjamin and his nephew Benji in September for the nine-day trek.

“I like to say it was the hardest mental thing I’ve ever done, but the most rewarding,” he said. “I got to spend time with my brothers, tell stories, laugh and develop friendships with the people that helped us.

“And hey, I climbed Kilimanjaro.”

Hernandez-Brito only got to spend 20 minutes at the top — ”You have to go back down pretty quickly because there are more people coming behind you,” he said — but he did find time for pictures. Specifically, he took one under the famous sign that reads: “Congratulations, you are now at Uhuru Peak, Tanzania, 5,895m/19,341ft AMSL.” There, you can see Hernandez-Brito’s smiling face just above a CAVS banner. “(It) was the first thing I packed for my trip,” he said. “I’ve always got to represent the wine and gold.”

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