Crain's Cleveland Business

VOL. 39, NO. 44

OCTOBER 29 - NOVEMBER 4, 2018

Source Lunch

Akron The Rubber City’s future is female, young and diverse. Page 29

Darlyn McDermott, Magnet’s market leader, senior adviser Page 31

CLEVELAND BUSINESS

The List Largest hospitals by net patient revenue Page 27

HEALTH CARE

CLINIC, CASE PROJECT HAS LOFTY GOAL STORY ON PAGE 18

A patchwork sky frames the exterior of the Sheila and Eric Samson Pavilion on Cleveland Clinic’s main campus. The project is a joint venture between the Clinic and Case Western Reserve University.

(Photo by Ken Blaze for Crain’s)

DEVELOPMENT

Ohio City is gaining townhouse project

By STAN BULLARD sbullard@crain.com @CrainRltywriter

Hammers are pounding and nail guns are firing as a construction crew gives new life in the form of a townhouse-style apartment building on a former funeral home parking lot in Ohio City.

The studs and the first layer of wall surface are in place on the first two

floors of a three-story, $6 million project, using industry estimates, on the southeast corner of Lorain Avenue and West 41st Street. With a working title of “OC Townhouses,” the 32-suite property is the first residential development to rise amid the stretch of old commercial buildings where, during the past few years, the landmark Hot Dog Inn has gained new neighbors such as Platform Brewery, Ohio City BBQ and Plum Cafe.

SEE LORAIN, PAGE 29

Entire contents © 2018 by Crain Communications Inc.

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Series: Challenges of being a female chef

REAL ESTATE

Skyline looks to exit Cleveland hotel market

By STAN BULLARD sbullard@crain.com @CrainRltywriter

Flying Fig executive chef and owner Karen Small Page 14

Toronto-based Skyline Investments Inc. is getting ready to check out of the downtown Cleveland hotel market — if it can find a buyer for its two properties.

Skyline is preparing to market both its Renaissance Cleveland Hotel, at 24 Public Square, and the Hyatt Regency at the Arcade, at 420 Superior Ave., according to three real estate insiders who spoke on grounds that

they not be identified. They expect Holliday Fenoglio Fowler LP, a commercial real estate consulting, sales and financing firm, to hit the market soon with the offering.

With a proposed sale, Skyline, which is traded on the Tel Aviv stock exchange, would take advantage of a better-than-expected market among hotels after more than 1,000 rooms were added in the years before the 2016 Republican National Convention. While hotels suffered through a softer market after the convention, the market has firmed this year.

SEE SKYLINE, PAGE 29

10/26/18 3:45 PM

coNteNt

sPoNsored By

News aNd treNds from Northeast ohio’s techNology sector

Tech MaTTers a Grander SCale

Moen IT leader offers insight on scaling agile to meet changing business needs

M

oen, a North Olmsted-based faucets and fixtures giant, began integrating agile in 2014, initially as an IT methodology and then expanding its philosophy of smart software delivery company-wide to support its global business units and business functions. John McBride, senior IT director at Moen, offers his perspective on the benefits and lessons learned along the way of the company’s journey of introducing and assimilating the agile values and principles.

McBride What processes did Moen want the agile methodology to address? Moen’s initial focus was to develop business intelligence and advanced analytics. In today’s fast-changing business environment, it is critical to have meaningful and actionable analytics to respond to market opportunities.

Our vision was to leverage agile software methods to rapidly develop impactful, value-driven analytics focused on key business drivers. The agile software methodology let us deliver business intelligence dashboards in an accelerated timeframe compared to our more traditional waterfall methods. These tools enabled the business to clearly understand market dynamics and quickly develop plans to enable sales growth.

What was involved in terms of assembling the change agent team? We formed a team composed of cross-functional IT and business stakeholders who learned the key concepts of agile development. We utilized a local firm, LeanDog, which specializes in working with companies to learn and implement agile development methodologies. Once our cross-functional team was trained, they focused on not only delivering the initial business intelligence applications, but also refined how the agile development process would work best across the rest of Moen. The impact and

Calendar of

eVeNTs a ProdUct of

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FacTOrs TO cONsider wheN scaliNg agile

J

on Stahl, CEO and president of Cleveland-based LeanDog, offers the following tips for integrating and scaling agile values and principles enterprise-wide.

Before you begin, examine the organizational design and culture “Most organizations try to adopt agile values and principles without looking at the organizational design they currently have in place and challenging it,” Stahl said. Folding in the agile philosophy revolves around culture, so the approach must be embraced from the top down.

assemble an effective change agent team The composition of this diverse team should involve thought leaders and innovators in the business and IT departments. The change agent team is tasked with developing a strategy and communication plan that addresses the roadmap or strategy. Team members work in iterations to remove roadblocks, evaluate the change and measure success. Carbon copy the change agent team success of this team was immediate, which drew interest from other departments, and prompted us to invest in several additional agile teams.

How did Moen scale up agile? We scaled up our agile practices based on the success of the initial pilot team. Over the last three years, we leveraged the agile knowledge of pilot team members and supplemented with the LeanDog consultants, who acted as mentors and help broaden our agile capabilities. We now have several agile teams in place that support the majority of our strategic business functions and systems.

strategy as you scale, but minimize how distributed they are, at least initially. A larger organization may develop, say, eight to 10 teams composed of a handful or a dozen people that could equate to a fifth of the total workforce involved.

“When people say, I can’t imagine involving 1,000 employees in agile, I suggest getting 20% of your early adopters to become trained as agile coaches,” Stahl said. Don’t worry about involving the late adopters just yet, he said. “Humans will copy good things,” Stahl said.

waterfall and agile can co-exist Many companies do and still will retain some element of waterfall — a traditional, linear method of starting and completing projects that are best suited for repeatable tasks that are easier to estimate. “This is why a strong product management office is at the center,” Stahl said. “They have to help the product owners agree on the highest value work for the company, and help change the mentality from funding projects to funding products and people. Waterfall works best on products that can be managed without a lot of knowledge transfer between team members.”

What lessons have been learned as your company reaches agile maturity? There is no textbook answer on how to implement agile. Agile development is as much a philosophy as it is a development practice. The key point is to find which agile tenets are important to your company and build that into your design. Additionally, we have found that agile is not the answer to every project. There are some projects that will make more sense to perform in a more traditional waterfall approach, and there are instances where a hybrid solution makes sense. Once you get experience in the agile discipline, you are in a better position to

develop the strategy that makes sense for you.

Businesses looking to implement agile should start small and focus on the methodology. Our pilot team concept worked very well and allowed us to gradually assimilate agile methods within our IT function. Lastly, transitioning to agile is a large change management initiative and requires adequate time for the IT organization to learn, test and adopt new software development methods. Clear communication and management commitment to ongoing training are critical success factors to ensure long-term success.

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NOVeMBer 15

BIZCONCLE: 7 a.m. to 6:15 p.m., I-X Center, One I-X Center Drive, Cleveland. This is a unique education and networking event targeted for small and middle market executives and their employees. The convention provides attendees with the resources needed to spark creativity and help catapult their business to the next level.

Info: bizconcle.com

WOMEN’S ENTREPRENEURSHIP DAY CLEVELAND: 8 a.m. to 4:30 p.m., Case Western Reserve University’s Linsalata Alumni Center, 11310 Juniper Road, Cleveland. WED Cleveland brings together established and aspiring women entrepreneurs whose business or cause is aligned with making a social impact. Info: wedcleveland.org

BUILDING A BLOCKCHAIN ECOSYSTEM: 4 p.m. to 8 p.m., Larry Sears and Sally Zlotnick Sears think[box], 11201 Cedar Ave., Cleveland. As part of Global Entrepreneurship Week, this Cleveland event will convene blockchain enthusiasts who will speak about how to activate the region’s economy around this technology. Info: jumpstartinc.org/events/global-entrepreneurship-weekcleveland-building-a-blockchain-ecosystem/

CRAIN CONTENT STUDIO C l eve l a n d

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

10/25/18 9:57 AM

CRAIN’S CLEVELAND BUSINESS

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PA G E 3

District sees more SBA dollars going out

By JEREMY NOBILE

SBA loans to new businesses rise

jnobile@crain.com @JeremyNobile

The percentage of U.S. Small Business Administration loans to new businesses in the Cleveland market increased in fiscal year 2018 compared to fiscal year 2017.

Huntington Bank and KeyBank remain the Cleveland market’s most aggressive lenders of government-backed small business loans in the U.S. Small Business Administration’s flagship 7(a) and 504 loan programs.

Meanwhile, total dollars lent out through the SBA’s Cleveland district office grew by 5.7% over 2017 levels to a total of $453.6 million, according to data for the program’s 2018 fiscal year, which ended Sept. 30.

The bulk of those are 7(a) loans, which provide guaranteed loans of up to $5 million.

That comes despite the total number of loans made in the region actually decreasing slightly to 1,811 from 1,818.

But perhaps most interesting is the shifting demographic of borrowers being awarded those loans: More dollars are going to early stage businesses, manufacturing companies and businesses in more rural areas both in the Greater Midwest and in the Northeast Ohio pocket itself.

Cleveland district director Gil Goldberg said that may be a function not just of needs in the market, but this point in the economic cycle.

And taken collectively, those trends signal a friendly climate for businesses in those sectors seeking SBA financing.

In terms of the most active SBA lenders in this region, the top players are mostly the same from fiscal 2017.

Huntington is the most active by far, as more than 36% of all SBA dollars in the Cleveland region ($166.5 million) were issued through the firm. Of the 1,811 total SBA loans made in the district, Huntington made 1,115, or 61% of them. The bank lent out $149.5 million in fiscal 2017 over 1,145 loans.

Comparatively, KeyBank, the No. 2 SBA lender, is responsible for about 7% of all dollars lent out ($32.7 million) over 69 total loans. That’s a slight decrease from its activity in Cleveland the year prior. The bank has touted its increased focus on SBA lending nationally in recent years, though. The bank lent out $38.7 million through 82 loans the year prior.

Rounding out the top five largest SBA lenders in Cleveland (by number of loans made) are Citizens Bank ($8.7 million, 60 loans), U.S. Bank ($6.5 million, 46 loans) and Growth Capital Corp. ($4.3 million, 42 loans).

There were about 60,353 7(a) loans made across the United States in fiscal 2018, amounting to $25.37 billion, according to federal figures.

Those loans are most commonly used for acquiring land, purchasing equipment or as working capital.

Another 5,874 loans were made through the 504 program for a total dollar amount of over $4.75 billion

2018: 1,811 total loans New businesses

65%

Existing businesses

35%

2017: 1,818 total loans New businesses 27% Existing businesses 25%

73% 50%

75%

100%

Source: Cleveland District Office of the U.S. Small Business Administration

cludes a firm with new ownership that may have come through something like a buyout by another company or its employees. This is because bankGoldberg ers ask for three years of financial statements in evaluating a borrower, but those statements don’t apply after an ownership transition because cash flow projections are tied to the prior ownership.

So as far as the banks are concerned, a company that has been in business for decades is new once ownership changes hands. Some

firms in that position have received SBA loans to beef up their capital levels, Goldberg said, or to finance a transaction as baby boomer business owners opt to sell while the market is strong.

A strong market also means banks are more comfortable lending without SBA support, which is how it should be. Banks usually look to the government-backed loans when times are tough, and borrowers can’t get capital through conventional means.

But that’s not the case as much today.

In fiscal 2017, just 27% of SBA dollars lent out went to new businesses that are considered higher risk borrowers.

SEE SBA, PAGE 8

Sheet Metal and Air Conditioning Contractors’ National Association of Cleveland

CONGRATULATES TOM MARTIN President, T. H. Martin, Inc., President, SMACNA-Cleveland

SMACNA National Contractor of the Year

SMACNA Cleveland Board of Directors TOM MARTIN President of SMACNA T.H. Martin, Inc.

MICHAEL STEIDEL Treasurer Castle Heating & Air, Inc.

DONALD C. SKALA Vice President Franck & Fric, Inc.

CONRAD WOS Secretary American Air, Inc.

CRAIG BERMAN Director Geauga Mechanical Company

JOHN E. SICKLE, JR. Immediate Past President Duct Fabricators, Inc.

JACK MAY, JR. Director Aberdeen Mechanical, Inc.

JOHN R. SINDYLA Chief Executive Officer

Who’s getting what?

What stands out the most in the numbers for fiscal 2018 is the shift toward startups and new businesses in general.

The SBA lumps those together, qualifying a new business as one that’s been in operation for fewer than three years.

It’s also worth noting that a new business by SBA standards also in-

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10/26/18 3:23 PM

PA G E 4

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CRAIN’S CLEVELAND BUSINESS

Kent Elastomer driven to stay on steady growth trajectory

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If you’ve ever put nacho cheese on your chips at a Browns game or worn braces, chances are good you’re familiar with Kent Elastomer Products Inc. Well, maybe not with the company itself, but at least its products.

On the snack side, Kent Elastomer Products makes the tubes that help dispense cheese at concession stands. As for the orthodontia, the company is responsible for the vast majority of the tiny rubber bands used on braces, company president Bob Oborn said.

“In that little bag that you get, there’s about 4 inches of tubing,” Oborn said. “We make about 140,000 feet a day.”

Kent Elastomer Products makes natural and synthetic latex and thermoplastic tubing, as well as dip-molded products. It has about $35 million in annual sales and employs about 185 people. And now, the company is set to grow.

Kent Elastomer Products, which is owned by Milwaukee-based Meridian Industries Inc., is in the midst of an expansion. The company is adding five additional offices, a conference room and a lunch room to its headquarters in Kent.

“It’s stuff we should have probably done 10 years ago,” Oborn said.

At its Kent location, the company offers a continuous dip process and batch dipping, which can be used to form products of different shapes, as opposed to just tubing. For example, one of the batch-dipped products Kent Elastomer Products makes is bellows for anesthesia machines.

One of Kent Elastomer’s product lines is PVC tubing, which is often used in medical and laboratory applications. (Contributed photo)

The company offers thermoplastic extrusion lines at its plant in Mogadore, and processing and assembly at its Winesburg facility.

In 2019, Kent Oborn Elastomer Products will expand the space for its latex tubing operation in Kent and will add a clean room to an extrusion line in Mogadore. The clean room will be a first for the firm and will expand the types of products it can make. In total, it’s investing about $2.5 million in the expansions.

Oborn, a longtime employee, took over as president about seven years ago. He immediately knew he wanted to make some changes to how the company approached sales. Kent Elastomer Products had always taken

good care of the customers it had, he said, but it didn’t actively seek new ones.

“And I wanted to change that,” Oborn said.

Today, Kent Elastomer Products has two employees dedicated to searching for new customers and two dedicated to serving existing customers, an approach that Oborn said is setting the company up for growth.

Oborn’s goal is to grow the business to annual sales of more than $60 million in the next 10 years. He expects to add about $10 million in sales to the extrusion business in that time and bring on new capabilities to its offerings.

The majority of the company’s customer base is the medical industry, Oborn said, and that industry is “bursting at the seams.” (The food, dental and industrial markets make up the rest.)

SEE ELASTOMER, PAGE 8

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MY BENESCH

MY TEAM “Benesch was critical during the evaluation and eventual sale of our company and enabled us to break new ground. I appreciate the personal touch and access we receive and the fact they’re so focused on our work.”

DON ESCH CEO Bettcher Industries, Inc.

Honoring its 70-year legacy of innovation and its employees’ loyalty and engagement is a priority for Bettcher. So when it was considering a buyout from a private equity firm, it didn’t want to completely lose its current employee stock ownership structure.

Benesch was able to devise an innovative structure that enabled Bettcher to continue as an ESOP while welcoming the infusion of resources the new owners bring.

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PA G E 6

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CRAIN’S CLEVELAND BUSINESS

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BakerHostetler, one of Cleveland’s oldest law firms (dating back to 1916) and the second-largest in Northeast Ohio today behind only Jones Day, is transitioning its chairman to Paul Schmidt from Steven Kestner in a long-planned move happening in January. ¶ Under the leadership of Kestner, who has held the role for 15 years, the firm has achieved steady Kestner Schmidt growth through and in the aftermath of the last economic downturn to some 950 lawyers in 14 offices. As Schmidt steps up as the firm’s top executive, he looks to maintain that growth despite facing a legal market that’s not only as competitive and challenging as ever, but one that’s feeling the urgency to evolve with, and adapt to, today’s increasingly tech-enabled business world. ¶ Crain’s sat down with the incoming and outgoing chairmen to discuss how the legal industry has changed, where the future of the legal business lies and whether robots will ever take the place of a human lawyer. (The conversation has been edited for length and clarity.) — Jeremy Nobile Has the business changed much in the 15 years you’ve been firmwide chair?

SK: I think it’s a much more competitive industry than it was back then just among law firms and for strong client relationships. It requires a fair amount of work every day to make sure you’re providing the high-quality service clients have come to expect.

Some firms say that, but may only have like 5% of their work billed under alternative arrangements.

SK: It’s hard to give an exact number, but we are definitely above 5%.

There’s more expectations from clients today, too, right? Dropping off a bill and calling it a day just isn’t how it works anymore.

SK: Absolutely. And a key to growth is definitely stronger client relationships. But there’s more negotiation with clients, no question.

We are open to alternative fee arrangements. We have a group working on that internally.

Is Cleveland still a major market for the firm today?

SK: Cleveland is still our largest office and it’s a very significant legal market. But back in 2004, for example, we had 20 lawyers in New York. We now have 160 there. We have since grown quite a bit in Houston, Washington, we have offices in Atlanta, Chicago, Philadelphia and Seattle. I don’t think there will be as much opportunity for growth here as there will in some other markets like Houston, or one as big as New York. But we are absolutely looking for growth here as well.

Is a significant part of the business in alternative fees?

When you look at growth opportunities ahead, what are

some of the most promising practice areas? Are they tech-driven?

PS: One of our fastest-growing practice areas is data privacy, cybersecurity. I would also highlight the whole concept of enterprise risk, and clearly cyber and data privacy are a piece of that. Cyber, data security, those are all things that didn’t exist a few years ago.

We look at how emerging technology will impact the delivery of legal services. That’s things like artificial intelligence, blockchain, data analytics. That’s something that will be transformative in the next decade. Health care continues to be a major industry and it will continue to be a major focus for us, as well as energy. And that’s just a sample.

SK: Blockchain is another area we’re still trying to figure out how it’s going to work in the everyday business of our clients. We work closely with our chief information officer and a team that evaluates some 200 different emerging tech programs to see what could help increase efficiencies for us and our clients and to inform them about things they might not even know about yet.

BakerHostetler made headlines in 2016 when word spread about the firm being one of a few working with IBM’s Watson-powered ROSS A.I., which automates some processes and helps with things like discovery and research. How has that been additive to the firm?

SK: It’s a tool that can be used to implement efficiencies. We can more

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effectively serve clients and in a way that lets us communicate more easily and readily on how to serve their needs. A paper will be published in a couple weeks with a major journal where we’ve provided some feedback. We can talk about that more when it’s published.

Have you ever disclosed what using that has either cost or saved the firm?

SK: I don’t have hard numbers. It’s more an investment in the people and time.

Industry publications billed this as the harbinger of the age of legal robots. Are we there yet?

SK: (Laughs) There are no robots.

Lawyers are never going to be replaced by robots. It’s a tool like any other technology tool.

s in

That technology automates some process and helped with research, particularly in the bankruptcy practice, right?

PS: That’s one use of it. Steve and I were of a generation where we learned to research in books. When you look at the footprint of firms today, you’ll see very few maintain their libraries anymore. That used to be a major part of your lease — the space for your library. You’d measure a firm by the size of their library.

ich d y en

You don’t have a library here, though, do you?

SK: No. The offices we were in before (in Key Tower) had the same square feet and I think one-third of a floor was a library with books in it.

ore

PS: I think when the first legal research tools came out, many folks

n s ch

ur t

said they would never replace books.

Now firms don’t have libraries.

So is it a stretch to think that automation could replace a lawyer considering, at one time, most didn’t think technology could replace a firm’s library?

PS: With ROSS, it’s interesting because it’s another enhancement of technology to make people more efficient. We still do a lot of legal research. It’s just all on your laptop now. So I view it as an evolution of efficiency tailored to meet specific needs. It will never replace the actual lawyer.

Considering the firm’s physical presence is concentrated in the U.S., will we see BakerHostetler go international?

PS: We are fairly unique in our peer group in that we practice around the world, but are almost exclusively U.S. One thing that will be a challenge for us is whether that will be the right model going forward or whether, like other firms have done, crossing the ocean makes sense. When you look at the Global 100, we are a bit of an outlier in that regard. And firms have felt a lot of pressure to be international.

What’s the top item on your list of possible headwinds to all these growth plans?

PS: Like, how you mentioned, 2008 was an economic recession, there will likely be, at some point in the next 15 years, some kind of correction. When that happens, you have to make sure you’re well-poised to face that. Would I be happy to not see another downturn in the next 15 years? Sure. Is that realistic to expect? Probably not.

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PA G E 7

MANUFACTURING IS:

Leadership

M-7 Technologies is thriving in Youngstown thanks to an embrace of cutting-edge advancements When Michael Garvey was working on the trading floor of the New York Stock Exchange after college, he never dreamed he’d one day be back in the Mahoning Valley, running a company his grandfather started in 1918.

However, life had other plans. The steel mill shutdowns decimated his family’s business — a bronze foundry that made castings for the steel industry — and, after his dad became too sick to work, Garvey decided to “come back to Ohio and attempt to save the family farm,” he says. “The family farm happened to be a bronze shop.”

Three decades later, Garvey is now the president and CEO of M-7 Technologies, a Youngstown-based advanced manufacturer that’s a leader in the field of precision measurement. Today, for another of his Youngstown companies, Center Street Technologies, MAGNET built the largest additive manufacturing machine in the world.

“You can drive a Ford F-150 pickup into it,” says MAGNET vice president of operations Mike O’Donnell of the 3D printer. “You can build parts that large — 8 feet tall by 12 feet wide by 20 feet long.” No wonder Center Street Technologies received the Northeast Ohio Innovator of the Year at MAGNET’s recent Northeast Ohio Manufacturing Symposium; Chuck George and Garvey (pictured, from left) accepted the award and made inspirational remarks.

Innovation is something Garvey has always embraced.

“My whole focus has been on making sure we create a sustainable business model,” he says of running M-7 Technologies. “I decided to focus in on technology — and to use technology to sustain the business.”

The company’s manufacturing process incorporates digital-based, high-speed measurement instruments and advanced software. This allows them to measure with great accuracy — and then produce — mechanical parts (such as gearboxes) and assemblies. Thanks to this process, M-7 Technologies-manufactured parts fit better and last longer — which, in turn, extends the lifespan of metal producing and power-generating equipment.

Longer-lasting parts also reduce costs for customers in the advanced energy, aerospace, defense, heavy industrial, and automotive industries. “[Reducing costs] is something that is very important to our customers,” Garvey says, while adding that M-7 Technologies has grown their business 400% in 14 years — “or, on average, 20% yearover-year for 14 consecutive years.”

This customer-focused mindset is just one reason M-7 Technologies has thrived. Garvey meticulously studies the Baldrige Performance Excellence Program, which provides guidance to organizations around certain criteria (such as leadership or workforce development) as a way to help them refine processes to boost success. He’s also implemented company core values, based around lessons his parents taught him and his siblings. And M-7 Technologies is also a big advocate for “life-long learning,” Garvey says, and has a generous tuition reimbursement program for employees.

All of this has helped M-7 Technologies be an in-demand employer, Garvey shares.

“We don’t have turnover. We have a list of people waiting to come and work for us.”

As he looks back, Garvey says it’s “very humbling” to have turned around the business his grandfather started. “I’m very grateful to have been involved with that, and to have the mentorship from both my dad and my grandfather,” he says. “I feel like, ‘OK guys, I did it. I got us into the next century.’ I’m extremely appreciative of the opportunities that they were able to create for me. It was because of how they raised me that I do what I do.”

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This advertising-supported feature is produced by Crain Content StudioCleveland, the marketing storytelling arm of Crain’s Cleveland Business.

The Crain’s Cleveland Business newsroom is not involved in creating Crain Content Studio-Cleveland content.

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PA G E 8

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SBA

CRAIN’S CLEVELAND BUSINESS

SBA loans by industry

CONTINUED FROM PAGE 3

But in fiscal 2018, new businesses were recipients of 65% of all money lent.

“That’s huge,” said Goldberg, who started with the SBA in 1994. “We’ve never seen anything like this in my years with the SBA.” Goldberg said he thinks that trend is a result of banks being more comfortable lending to established businesses, which is due to a stronger economy of corporations being more flush with cash following tax reform and a regulatory climate trending toward the more business-friendly end of the spectrum.

Other Great Lakes regions, including Goldberg’s counterpart office in Wisconsin, have reported a similar finding, indicating the trend is strong across the Midwest.

“So this is the right time (to look for SBA financing) in the startup world,”

The percentage of U.S. Small Business Administration loans by type of business for fiscal year 2018 shows the number of loans to the non-food service industry ahead by a wide margin in the Cleveland market, though manufacturing is gaining ground.

2018 total loan dollars: $453.6 million Services (except food) $252.5M (55.7%) Manufacturing $66.5M (14.6%) Food services $41.1M (9.1%) Retail $32.3M (7.1%) Wholesale $30.7M (6.8%)% Construction $30.5M (6.7%) 10%

20%

30%

40%

50%

60%

Source: Cleveland District Office of the U.S. Small Business Administration

Goldberg said. “The stars are aligning. Market forces are coming together to help make your business a suc-

cess if you can get your business started now.”

Goldberg highlighted the increased

level of financing for manufacturers from SBA loans this year in particular.

That sector was one of the largest recipients of SBA loans in this market decades ago before trends shifted toward service sectors. But the SBA lending to manufacturers is beginning to tick up again. The total money lent to that sector grew nearly 18% in FY 2018.

“It’s not quite like the old days,” Goldberg said.

But it’s significant. Goldberg said manufacturing composed close to 40% of all SBA borrowers through the 1990s before shifting to service-based businesses in the early 2000s.

Today, manufacturing accounts for 14.6% of all SBA dollars lent out, and that figure is trending upward. Services comprise nearly 56%, and it’s trending down. Some of that growth is coming from manufacturers in rural markets, where SBA lending has been increasingly promoted, Goldberg said, including Geauga County.

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But the medical field has shied away from latex in recent years.

When practitioners started wearing gloves more frequently in the 1980s as a result of the AIDS epidemic, some people had reactions to the latex. In response, the industry began to rely on thermoplastic elastomers.

Kent Elastomer Products got its start as Kent Latex Products almost 60 years ago but invested in an extrusion line when it saw this trend beginning.

The name change came in 1998.

The industry’s move away from latex also led to a new product line for Kent Elastomer Products, which has made an extruded, latex-free tourniquet band for almost 20 years. It’s a small but growing product line, Oborn said.

Tom Wilke, eco- “They nomic developnever ment director for the city of Kent, seem said he has been impressed by the satisfied company’s con- with stant drive to improve by increas- where ing efficiency and they’re growing sales.

“They never at.” seem satisfied with where they’re at,” — Tom Wilke, Wilke said. “And I economic think this growth development they’re doing right director now is an indica- for the city tion of that, as of Kent much as anything else.”

Wilke also praised the company’s work environment, saying when employees are respected, it can help companies grow in a tight labor market, keeping turnover low and making it easier to attract potential workers. Kent Elastomer Products is the “epitome” of that, he said.

Oborn said the company tries to treat people right, paying well and offering good benefits. The average tenure of Kent Elastomer Products’ employees is more than 14 years; it’s more than 25 years just counting salaried employees, he said.

It has kept some customers for a long time, too.

Atrium Medical and Kent Elastomer Products have been working together for about 20 years, said Mark Foster, director of materials management for Atrium-Getinge Group.

Getinge Group is a Swedish company that serves as the parent company to New Hampshire-based Atrium, which makes medical products, including chest drains, coverage stents and vascular grafts.

Though Foster acknowledged it’s an “overused term,” he said he views the Kent company as more of a partner than a supplier. Atrium buys more than 2,000 miles of surgical tubing from Kent Elastomer Products per year to go in its thoracic drainage products.

“We truly do have a partnership with them, where when there’s any issue that comes up or a challenge that we have, whether it’s on the design side or it’s a quality issue, or whether it’s a supply issue or an inventory challenge, Kent is always there to work with us,” Foster said.

For example, Kent Elastomer Products is proactive about keeping Atrium informed of industry pricing trends, letting the firm know if the price of the raw materials in their products is going up or down, he said. And the companies have worked together to manage price adjustments, switching from real-time adjustments to quarterly ones.

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City’s Circle North plan is rising to expectations

By STAN BULLARD sbullard@crain.com @CrainRltywriter

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Glenville Circle North, the first project and designated development area in Mayor Frank Jackson’s Neighborhood Transformation Initiative, is rising.

Construction crews are at work at Boca Raton, Fla.-based Finch Group’s four-story apartment building on East 105th Street near Superior Avenue after the project late last month assembled a total of $15 million in funding from multiple sources. That is no small thing for the Glenville neighborhood, an area where traditional lenders typically would not take such a big risk.

Moreover, as part of the same neighborhood initiative, the city has just awarded a contract to Beachwood-based Orlean Co. for 26 of the city’s land bank sites in the adjoining neighborhood for construction of market-rate homes. Additionally, Concord Township-based builder Knez Homes has sold five of 10 lots it acquired in the neighborhood as the city’s neighborhood initiative was in its formative phase.

Edward Rybka, Cleveland chief of regional development, recalled in an interview that a dozen years ago, as the city tore down blighted homes during the housing collapse, the mayor regularly said the value for the city’s future would be in the land.

“Now we’re starting to fill in some of the missing teeth in other neighborhoods,” Rybka said, such as Glenville and in the future in other East Side neighborhoods that have not benefited from the rush to buy, rehabilitate and build new homes the way

East

Crews are at work on a $15 million apartment project in the Glenville neighborhood. (Stan Bullard)

West Side neighborhoods from Tremont to Detroit-Shoreway have done.

Wesley Finch, chairman and founder of his namesake development group, said that it would not have been possible to assemble financing necessary to make a go of his

“In Cleveland, we have a lot of young people.

We also have a lot of startups, often led by minority females.

This allows you to help them develop businesses, and perhaps be profitable at the end of the day.”

— Wesley Finch, chairman and founder, The Finch Group

project without the city’s help in bringing lenders to the table, from KeyCorp to allocations of more than $10 million in U.S. New Markets Tax Credits from Cleveland Development Advisors and Maryland-based Enterprise Foundation nonprofits.

“A market appraisal said the finished building would be worth $5 million, but it will take $15 million to build it,” Finch said.

The building will include one- and two-bedroom apartments, with a total of 63 suites. The property will market 25% of the suites as affordable housing to people making less than 80% of the area’s median income.

Those units will rent for less than $1,100 for a one-bedroom and less than $1,300 for a two-bedroom, while market-rate rents in the building can rise, Finch said, to whatever the market will bear.

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the vest lar t the F ning ing Ash ered twee and A ville of fi leas velo ed b deve rece Urb and rest for f Th will busi star Finc acce lis a “Th type wor en said arou ple to a the high acce D of e rest com apa deve effo port atio hoo Th acco ope “G Opp ring nize that ness gain vest area “I you have nori help perh the N the n min has Nor of $2 B said

CRAIN’S CLEVELAND BUSINESS

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PA G E 11

s

p in rom han Tax lopased s. finh $5 n to

and a tomarable han me. han less hile can mar-

VA r of rcle,

East 105th Street near Superior Avenue will gain a four-story building with apartments and commercial space when Finch Group finishes Glenville Circle North. (Cleveland City Planning Commission)

the project is designed to attract investment in the neighborhood similar to what has gone into the circle the past decade.

Freddy Collier, Cleveland planning director, said the area surrounding Glenville Circle North is near Ashbury Avenue, which is considered the “invisible dividing line” between the Glenville neighborhood and University Circle.

About 4,000 square feet of Glenville Circle North’s 14,000 square feet of first-floor retail space has been leased by the Cleveland Citywide Development Corp., a nonprofit operated by the city to reinvest in economic development projects funds the city receives, such as repayments of U.S. Urban Development Action Grants and others. The space will house a restaurant to help provide training for food startups.

The remaining commercial space will be dedicated to neighborhood business startups and youth-oriented startups that will be managed for Finch Group by gener8tor, a business accelerator with offices in Minneapolis and Milwaukee and Madison, Wis. “This operates as a Shark Tanktype setup that selects seven ideas to work with and see if they can be taken through development,” Finch said. “The youth component revolves around helping talented young people develop business plans. We hope to attract philanthropic support for the component for underestimated high school students, while the adult accelerator is a for-profit.”

David Ebersole, Cleveland director of economic development, said the restaurant training and accelerator components make the project stand apart from other city-aided housing developments. The business creation efforts are designed to provide support for the equity and wealth creation components of the neighborhood plan.

The idea clearly excites Finch, an accountant turned real estate developer.

“Glenville Circle North is also in an Opportunity Zone,” Finch said, referring to the investment program organized under the new federal tax law that allows investors to shelter business-related profits from capital gains taxes if they put them into investments in targeted low-income areas.

“In Cleveland, we have a lot of young people,” Finch said. “We also have a lot of startups, often led by minority females. This allows you to help them develop businesses, and perhaps be profitable at the end of the day.”

New homes already are going up in the neighborhood, if only through like minds colliding together. Knez Homes has acquired 10 sites in the Circle North area for homes costing upward of $250,000, and it has sold five.

Bo Knez, owner of Knez Homes, said he was scouting for home sites

P010_011_CL_20181029.indd 11

near University Circle when he learned from city officials about the then-planned Circle North initiative.

He already had been active in other

parts of the city, including Ohio City and Tremont, and sought to be close to University Circle because he considers it a “whirlwind of culture and

employment.”

Knowing that Finch Group’s project is going up provides further confidence in the area, Knez said, and his

company has had stronger interest in the sites than it anticipated.

“We’re looking for more sites to buy there,” he said.

10/25/18 1:55 PM

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CRAIN’S CLEVELAND BUSINESS

Opinion From the Akron beat

Akron wants you to talk about your growth

Editorial

Nothing lasts forever The economy is strong. Corporate profits are rising. Businesses are adding jobs at a healthy clip.

But if you’re a company owner or manager inclined to get even a little complacent in these good times, consider the demise of Sears — the powerhouse retailer of 20th century America but now just another company in Chapter 11 bankruptcy protection — the ultimate cautionary tale that carries some key lessons: Don’t stop innovating. Don’t gorge on debt. Be cleareyed about your problems. Take nothing for granted.

Sears, founded 125 years ago, was “bleeding billions of dollars in cash for years,” as our sister publication Crain’s Chicago Business put it in an excellent piece examining the retailer’s downfall.

From 2005, when Edward Lampert and his ESL Investments hedge fund acquired Sears, the company “dwindled from 2,350 full-line stores to 842, as of September,” Crain’s Chicago said.

The problems accelerated quickly, but they were a long time in the making. Going back decades, competitors such as Walmart and Home Depot found ways to appeal to Sears shoppers that the company wasn’t able to figure out how to match.

Unable to innovate operationally, Sears tried to get clever on the financial side and began drawing much of its profit “from ballooning credit balances, thanks to a Sears-branded MasterCard that let shoppers charge as much as $20,000 anywhere, not just inside its own stores,” Crain’s Chicago noted. Not exactly a sustainable strategy.

In the digital era, Amazon dealt a death blow to Sears — and, to be fair, many other traditional retailers — with its hyper-efficient algorithms leading to operations that get goods to people faster, and cheaper, than ever before.

Amazon sure looks like the future of retail, just as Sears did more than a century ago. The company’s current strength is benefiting not just consumers, but communities nationwide, including Cleveland, where Amazon has turned dead malls in Euclid and North Randall into big distribution centers employing thousands of people. (Now, if only Amazon would make sure its working conditions were better, or reconsider its deci-

sion to stop giving stock to many employees as it lifted its minimum hourly wage to $15.)

Sears showed that nothing lasts forever. The business that looks strong can, over time, lose its edge, or overlook better ways of doing business. Amazon is today’s giant, but the dynamism of our economic system is sure to lead to an innovative competitor that transforms the retail experience yet again, or perhaps pushes Amazon to be better and more creative so it, too, lasts 125 years. Or longer.

Personal touch

Business development agencies operating in Northeast Ohio do some good work, but they aren’t always working in ideal alignment. So we’re pleased to see signs of better coordination among groups including JobsOhio, the state’s development nonprofit; Team NEO, JobsOhio’s Northeast Ohio affiliate; and three other organizations: the Geauga Growth Partnership, the Greater Cleveland Partnership, and the Lake County Ohio Port and Economic Development Authority.

As Crain’s Jay Miller detailed in an Oct. 21 story, the groups have “mapped out a strategy to do a better job of working together to encourage and support growing businesses in Cuyahoga, Geauga and Lake counties.” A key piece of that approach: expanded outreach, featuring visits to Northeast Ohio companies that are growing and might be considering expansion.

That approach is tried and true everywhere, but it’s especially critical for Northeast Ohio, where our slow growth places a premium on identifying the businesses that offer the best prospects for adding jobs and then determining how best to help them do that. GCP, the story noted, has grown its business and physical development department to 13 people from five.

GCP’s Debra Janik said that while her staff in 2017 made about 375 outreach calls to area businesses, the goal for 2019 is to meet with owners or top executives of 1,000 companies. That kind of personal touch has to help, and it’s a refreshing change.

Publisher and Editor: Elizabeth McIntyre (emcintyre@crain.com)

CLEVELAND BUSINESS

CLEVELAND BUSINESS P012_CL_20181029.indd 12

Managing Editor:

Scott Suttell (ssuttell@crain.com)

Contact Crain’s

216-522-1383

Read Crain’s online: crainscleveland.com

If you’re spending the afternoon at your favorite fishing hole, and you see an angler in the boat next to you reel in a few beauties, chances are you’re going to want to hang around and keep your line in the water until you pull one in yourself.

That’s the simple way Dan Isenberg, founder of the Babson Entrepreneurship Ecosystem Project, explained the thinking behind a new movement called #ChooseGrowthAkron that’s just getting off the ground in the Rubber City.

I was part of a workshop a couple of weeks ago that Isenberg ran in Akron. The Burton D. Morgan Foundation brought him in to speak to an invitation-only group and get our feedback. Isenberg got us thinking about how entrepreneurship didn’t just mean “new business” or startup, but really Sue scaling up. Or to put it more simply: growth.

Walton The idea is not only that growth breeds growth, but that by celebrating their growth and publicly sharing success stories big and small, businesses can encourage more of the same and maybe inspire others to keep their fishing line in the water longer, so to speak.

Organizers carefully curated the workshop attendees to include those who could help shape the pilot program from the beginning and those who would offer feedback and help organizers gauge enthusiasm.

Like so often in Akron, where there is a general sense of trust and collaboration in the business community, when the call went out, leaders responded. The four-hour workshop included about 50 representatives from entities such as the city of Akron, Summit County, Huntington Bank, the University of Akron EXL Center, the Women’s Network of Northeast Ohio, WKSU, ArtsNow and the Bounce Innovation Hub. Plus, entrepreneurs, business owners and others.

The Morgan Foundation, which worked with Isenberg on its Scalerator NEO program, is funding the #ChooseGrowth Akron program with a grant of up to $50,000. That money helps bring in Heather Roszczyk, Akron’s innovation and entrepreneurship advocate, and AMP Strategy to help manage the campaign.

The most interesting part of the afternoon — and maybe I think this because of my line of work — were the exercises Isenberg had participants run through. One activity had us craft a specific, quantified story about a business’ growth — because, he said, even stories of ordinary growth are more impactful with details (that’s music to any newsperson’s ears).

But the other exercise was more telling. In a self-assessment of sorts, participants rated their perceptions of statements like “It is very common to hear people talking about examples of company growth in Greater Akron” and “Talking about growth is safe, respected and common in Greater Akron.”

The results, and ensuing frank and open discussion, were all over the board. Some felt the business community did a great job spreading the word about its successes. Others thought the community had a long way to go.

That’s where #ChooseGrowthAkron comes in, Roszczyk said.

“We’re all interested to see what a focused storytelling campaign about growth, what kind of effect it can have,” she said.

Organizers are looking for an organic buildup, Roszczyk said, whether businesses try to share via conventional media, social media or even word of mouth.

Do I think we at Crain’s are doing a good job of talking about growth in Akron? I hope so. But we can always do better, and we continue to want to hear your stories.

Do I think just talking about growth encourages more growth? That’s a hard question to answer.

But I do know this: It certainly can’t hurt.

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

Sound off: Send a Personal View for the opinion page to emcintyre@crain.com.

Please include a telephone number for verification purposes.

10/25/18 4:10 PM

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Skills gap is widened by lack of awareness, want-to

By MARK C. PERNA

potential; we just have to unleash it. When we can show them something they really want, they will find the motivation and drive to achieve it. I call this the want-to, how-to concept: if the want-to is strong enough, the how-to will come.

We’ve all seen this dynamic in action in our own lives. If we want something badly enough, we find a way to make it happen. The “why generation” is no different. Our challenge is getting them to want something so much they will overcome obstacles, put forth the effort and reach the career destination that can give them what they’re looking for.

Employers need to understand the want-to, how-to concept to make the most of their relationships with the younger generations in their workforce.

The awareness gap and the want-to, how-to concept are not just abstract ideas. They have been perfectly illustrated in my own home with my son Nick. He’s extremely intelligent but constantly struggled in school because he never understood the relevance of academics. In his mind, there was no compelling dream

The skills gap is staring us in the face.

In Ohio by 2020, 65% of jobs that pay a viable living wage will require college degrees or training certificates, but only 54% of adults in Northeast Ohio are qualified. Looking at the problem nationally, by 2025, the United States will be short 11 million certificate holders and degree holders to support the economy, according to Georgetown University’s Center on Education and the Workforce. ADP and Moody’s Analytics reports that the gap won’t close any time soon.

The disparity between the skills employers need in their workforce and the skills workers actually possess spans many different industries, including advanced manufacturing, health care, construction, aviation and other fields. We’re all asking the same pressing question: Why? Why do we have this enormous gap between what employers need and what workers can deliver?

It’s a multifaceted question, but I would argue that one part of the answer is what I In general, most people today call the “awareness gap.” This is the chasm between what people think simply are unaware of the many they know about a particular carewarding career pathways and reer or industry and what the actual reality is. In general, most peoopportunities in these ple today simply are unaware of high-demand industries. Maybe it’s the many rewarding career pathbecause of the stigmas of the ways and opportunities in these high-demand industries. Maybe past. Maybe it’s because we’ve it’s because of the stigmas of the Perna gutted technical skills programs past. Maybe it’s because we’ve gutted technical skills programs in in our educational system so we can push our educational system so we can push everyone to go to college. everyone to go to college. Maybe we just think Maybe we just think today’s young today’s young people know more than they people know more than they know know (and if they don’t, whose fault is that? (and if they don’t, whose fault is Not theirs). that? Not theirs).

To bridge the awareness gap, we have to start meaningful career exploration at a young- to work toward, so it just didn’t matter. He didn’t know er age in our educational system — career exploration of any careers he would love (his awareness gap), and that encompasses and extols all viable career path- he was thus completely unmotivated to do the work to ways, not just the ones that require a college degree. succeed.

That all changed the minute he toured a computer College can be a great option for many students, but it’s not the only route to a rewarding and sustainable programming career program and discovered what he wanted to do with the rest of his life. career.

In Nick’s case, the change was overnight. His dream Today’s young people have what it takes to step up and address Ohio’s skills gap. We just have to empower career required a college degree, and suddenly he rethem to do it. alized he needed to boost his uninspiring 1.5 GPA. Amazingly, he turned his lackluster performance around and was able to reach his goal. He wanted his The ‘why generation’ dream enough to find how to make it happen: the The Y and Z generations — who will inherit our want-to, how-to concept in action. Today, he’s workskills gap — have been negatively stereotyped as lazy, ing in his field and loves what he does. There are alentitled and unmotivated. This doesn’t bode well for ways new goals and achievements on his horizon.

Northeast Ohio needs more stories like Nick’s, and employers looking to find, train and retain the best young talent out there. Fortunately, the stereotypes we can take steps to help that happen. First, we have to don’t have to be true. make students and their parents aware of the multiAs a performance consultant for workforce devel- tude of postsecondary training pathways that lead to opment, I’ve started calling generations Y and Z the rewarding careers (realizing we may have to bridge “why generation.” They’re always asking the reason our own awareness gaps first). Then, we have to show behind everything. This questioning isn’t a challenge them why pursuing these pathways is worth the work to authority. Rather, it’s because knowing why vali- — creating the want-to. Once the want-to takes over, dates their work. They want to belong and contribute the how-to will take care of itself. Achieving these obto something larger than themselves, and when they jectives will require unprecedented connections becatch that vision, they deliver their fullest effort. tween business and industry and our educational sysThey’ve been reared to believe in what they can con- tem to promote robust career exploration.

In Ohio, the careers are available and so are the peotribute, and they want to put their own stamp on the work. But when that desire for information is stymied, ple; we just have to connect them. And it starts with when we answer, in effect, “because I said so,” when bridging the awareness gap. they ask why, they don’t see the point of putting in all this effort. We’ve failed to answer their why.

Perna is CEO of TFS, a full-service strategic consulting After more than 20 years in this field, I have found firm in Twinsburg, and the author of “Answering Why: the stereotypes are only true when we make them a Unleashing Passion, Purpose, and Performance in self-fulfilling prophecy. Young people have amazing Younger Generations.”

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CRAIN’S CLEVELAND BUSINESS

CHALLENGES OF BEING A FEMALE CHEF | A CRAIN’S SERIES

Flying Fig owner focuses on ‘real’ food, collegial workplace

By JOE CREA clbfreelancer@crain.com

Look at any truly trustworthy list of Cleveland’s top restaurants and you’re certain to find The Flying Fig. Few dining destinations are more respected, even revered. It’s an unassuming sort of place: a 16-seat bar and tables to accommodate just a few dozen guests. But a hideaway sense of mystique pervades the room — sort of moody yet with plenty of energy, a tolerable din and a space simmering with high expectations.

And those expectations are routinely met. The Fig, as regulars call it, consistently turns out some of the best food in town.

By most measures, the bill of fare is exceptionally brief — “well-curated,” in today’s language. On it, you’re likely to find Fig standards such as a great burger, just about perfect shrimp and grits, and delectable Medjool figs stuffed with chorizo.

Owner Karen Small, whose inspirations are built upon savory and often refreshing fusions of Eastern and Western ingredients and techniques, runs her kitchen with an innovative

About this series: Joe Crea looks at the challenges that female chefs and restaurant owners face in a male-dominated industry, and he profiles some of the area’s top women restaurateurs.

“I never cared for the flavor of ‘corporate food,’ and agribusiness has always been a problem for me.”

—Karen Small, executive chef and owner of The Flying Fig

eye and an exacting hand. Be it a salad composed of local produce, one of the chef’s satisfying pastas or a robust center-of-the-plate piece of fish or meat, each dish is resolutely prepared from top-notch local ingredients, deftly seasoned, then presented with craftsmanlike precision. And they’re flat out delicious.

At age 64, Small views her tiny bastion with both affection and a critical eye. In the spring, she earned a rare honor as one of two Cleveland area chefs, both women (the other is Jill Vedaa, chef-owner of Salt in Lakewood) to earn nominations for James Beard Awards.

“The James Beard nomination just blew me away,” Small said. “Kind of something you maybe don’t even imagine because it’s such a … ‘thing.’ ” Raised in Shaker Heights, Small attended the Beaumont School in Cleveland Heights. As with so many future chefs, good food was central to Small’s family life.

“I grew up in an Italian family — not to diminish my mother’s Irish heritage — and my grandfather had a big garden in the backyard and raised an acre of just about everything at a family member’s farm,” she said. “Everything we ate was made from scratch. We made the pasta, made sauce from tomatoes we’d grown. I never developed a taste for supermarket white bread; our bread was homemade. What we ate was never a lot of processed craziness.”

After graduation, Small headed south to Ohio University. That’s

where the motivations behind her approach to food took shape.

“When I moved to Athens in the early ’70s, (food) became a political issue,” she said. “It was a kind of communal atmosphere. We grew our own food. I never cared for the flavor of ‘corporate food,’ and agribusiness has always been a problem for me.”

The desire for “real” food, as she calls it, drove her when she came back to town, and she started working in restaurants. Self-taught, Small

found work at Paul Minnillo’s Baricelli Inn in Cleveland’s Little Italy neighborhood.

“I learned so much from Paul, about food and running a restaurant, and working with others, especially men,” Small said. “He’s a tough guy, but inwardly a very kind person.”

A procession of gigs, and leadership roles, followed.

“I kind of waltzed into ownership of the Ninth Street Grill, then the Fulton (Avenue Cafe), then Jezebel’s in

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CRAIN’S CLEVELAND BUSINESS

Karen Small, executive chef and owner of The Flying Fig: “I knew I wanted to support local growers, local artisans who really put their lives and their souls into what they produce.� (Tim Harrison for Crain’s)

Chagrin Falls. I sold wine and cheese for a while. Then the Fig happened.�

Late in the summer of 1999, Small took over the property at 2523 Market Ave. in Cleveland, across from Great Lakes Brewing Co. Though she knew the kind of food she wanted to serve, finding the raw ingredients seemed insurmountable. “It was not a conscious decision: ‘Oh, I’m going to redo farm-to-table.’ I didn’t even know what that was. I knew I wanted to support local growers, local artisans who really put their lives and their souls into what they produce. “But it was hard. When we were starting out, it was hard to find that kind of food around here, especially in the kind of volume you need for a restaurant.�

Gradually, Small found the ingredients. Her menu proclaims well over a dozen local farms that provide her with everything from heirloom vegetables and hard-to-find cultivated mushrooms to pasture-raised meats.

Behind the scenes, Small cultivates a tolerant atmosphere. Women and men work in spirit of collegiality — at least within the context of a usually manic restaurant kitchen. “I grew into an ownership role pretty quickly, and that changes the dynamics between women and men.

It absolutely does,� Small said. “I think some owners may tend (not to tolerate) a hostile or aggressive (work) atmosphere, and at least in my experience, they won’t tolerate it

happening to others.�

Still, Small’s reputation for toughness and a demand for exacting results on the plate has occasionally earned her the “B� word, she admitted. “I would suppose some people would perceive me as a ‘bitch,’ � she said, laughing. “I see it as having the perspective of someone who knows what she wants. “Anyway, that’s the pushback I get in the kitchen: ‘Why do we put in so much time doing so many of the things we do?’ But I’m not going to change that. I know what I want, and what we need to do to get there. I think that’s what makes the Fig persist, and what makes it special. It’s the purity of the food we use — very good products. It’s clean and pure food, and not over-the-top innovative.�

As her restaurant enters its 20th year, Small allows herself a quiet measure of satisfaction. “I never thought in a million years this is where my career would lead me,� she said. “It’s taken too much time and energy; there IS that element of luck. Still, I don’t think you get good breaks without hard work. “I’m stunned by the way this place is perceived. It says so much about how hard the people in my restaurant have worked. I’m grateful. Just incredibly grateful.�

She thinks for a moment, considering other epithets. Finally, she speaks. “Yes, grateful is the word.�

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PA G E 16

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CRAIN’S CLEVELAND BUSINESS

ANALYSIS

There still aren’t enough women at the table BLOOMBERG

The last time Kaitlin Savage attended a meeting that included another woman was months ago. Savage works in the solar industry, in which men outnumber women 3 to 1. The majority of her time is spent surrounded by men, who at times, she said, underestimate her work, flirt with her, call her after midnight for “personal reasons” and give her inappropriate compliments.

“It’s emotionally exhausting,” said Savage, who’s considered switching to a less heavily male-dominated field, like oil and gas.

She’s part of a group that a new survey from LeanIn.org and McKinsey & Co. calls “Onlys”: women who are often or always the only female in the room at work. One in five women place themselves in this category, according to the survey of more than 64,000 U.S. employees at 279 companies. That number rises to 40% for women in senior or technical roles.

Onlys face more challenges in the workplace than other women, the survey found. Half of these women said they need to provide more evidence of their competence than others do. Onlys are twice as likely as other women surveyed to be mistaken for someone junior. These women are also almost twice as likely to be subjected to demeaning comments and twice as likely to report having experienced sexual harassment in their careers.

A recent national survey of 64,000 employees found that one in five women categorize themselves as “Onlys:” women who are often or always the only woman in the room at work. (Brendon Thorne/Bloomberg)

“This was my entire career, basically,” said Kristen Fanarakis, who spent 15 years working in finance. She was a part of many all-male teams and didn’t have a female friend at work until she was in her 30s, she said.

Although Fanarakis had many supportive male colleagues and mentors over the years, she said, other men treated her with disrespect. One boss told her she could “handle the nappies,” she recalled.

Another held her to impossible standards, giving her poor performance reviews even though she brought in new business and met all of her goals, she said.

More than 90% of the companies surveyed said diversity and inclusion is a top priority, but for the fourth year in a row, Lean In and McKinsey found that corporate America has made almost no progress in increasing women’s representation in the B:10.25” workplace.

T:10.25”

These experiences are even worse for women of color. Almost half said they’re often the only person of their race at work. These women are more likely to feel excluded, scrutinized and closely watched, the survey found. Maura Cheeks, an MBA student, has written about having her identity mistaken for another black woman in the office and having to explain her credentials to colleagues.

More than 90% of the companies surveyed said diversity and inclusion is a top priority, but for the fourth year in a row, Lean In and McKinsey found that corporate America has made almost no progress in increasing women’s representation in the workplace. Women make up 48% of entry-level employees but only 22% of the C-suite, as companies fail to promote women, the study found.

Even those who do make it past the early stages of their careers aren’t likely to stay. Onlys are more ambitious than other women, the Lean In/ McKinsey study found: Almost half said they want the top job, and almost 80% said they want to be promoted. But they’re less likely to stay at their company; more than a third of Onlys said they’re thinking about leaving their jobs in the next two years.

“You have a group of women who are put in very isolating and scrutinized positions,” said Rachel Thomas, the cofounder and president of Lean In. “You would hypothesize the reason they are leaving is because

they are having an experience that is markedly worse than other women.”

Fanarakis, for one, eventually left her finance career behind. Being an Only “takes a physical and emotional toll,” she said. She went to business school, wrote a book, and in 2017 launched a women’s workwear startup.

Thomas suspects that many companies check the diversity box by hiring just one or two women. It’s a strategy that hurts more than it helps, she said.

At her first job out of college, Molly Oswaks was one of two women on staff at the tech news site Gizmodo.

She said her colleagues posted pornographic content in the company group chat, adding that readers would harass her in the comments section of her stories, saying she’d slept her way to the job. “There was no respect for the fact that women were there,” she said. “It was just like, I was the girl that they plucked to have a girl on staff.” (Gizmodo did not immediately respond to a request for comment.)

The benefits of diversity don’t kick in with tokenism. Studies have found that if women make up 20% of a group, they account for only 10% of the conversation. Women need to constitute a supermajority to make up 50% of talk time in a group.

“These companies want a diversity of ideas,” Thomas said, but hiring the bare minimum number of women produces “a diluted form of diversity.”

S:9.25”

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TAX LIENS The Internal Revenue Service filed tax liens against the following businesses in the Cuyahoga County Recorder’s Office. Liens reported here are $10,000 and higher.

LIENS FILED JJ Jones Day DB Master Trust

901 Lakeside Ave., Cleveland Date filed: July 13, 2018 Type: 990-T Amount: $187,571.02 JJ Westgate Electric Co. 7777 Exchange St., Suite 5, Valley View Date filed: July 25, 2018 Type: Employer’s withholding Amount: $125,458.04 JJ Royce Security LLC (two liens over $10,000) 3740 Euclid Ave., Cleveland Dates filed: July 2, July 25, 2018 Type: Employer’s withholding, unemployment Amounts: $112,787.54; $29,474.02

JJ Cher-Jo Corp.

2808 Kingsbury Drive, Rocky River Date filed: July 25, 2018 Type: Employer’s withholding Amount: $12,929.55 JJ Jordan & Tristen Investments LLC 3740 Euclid Ave., Suite 100 Date filed: July 2, 2018 Type: Employer’s withholding Amount: $11,167.71 JJ PS Lawes Landscape Management Inc. 8371 Canterbury Court, Chagrin Falls Date filed: July 25, 2018 Type: Employer’s withholding, unemployment Amount: $11,002.00

JJ Ideas Group Corp.

127 Public Square, Suite 5110, Cleveland Date filed: July 13, 2018 Type: Corporate income Amount: $83,689.21

LIENS RELEASED 10500 Antenucci Blvd., Suite 101, Garfield Heights Date filed: May 24, 2018 Date released: July 25, 2018 Type: Nonpayroll withholding Amount: $96,136.89

JJ Horizon Electric Company Inc. (two liens over $10,000) 15100 Arden Ave., Lakewood Dates filed: Dec. 12, 2017; May 3, 2018 Date released: July 13, 2018 Type: Employer’s withholding Amounts: $40,147.06; $16,331.24

JJ Digestive Health Inc.

JJ Mindlin Consulting Group Inc.

JJ Cleveland Urology Associates Inc.

23250 Chagrin Blvd., Building 5, Suite 110, Beachwood Date filed: Dec. 14, 2017 Date released: July 13, 2018 Type: Employer’s withholding Amount: $53,022.53 JJ Yassini Group

6701 Royalton Road, North Royalton Date filed: July 5, 2017 Date released: July 25, 2018 Type: Employer’s withholding, unemployment Amount: $41,688.26

1463 Northland Ave., Lakewood Date filed: April 7, 2015 Date released: July 13, 2018 Type: Employer’s withholding Amount: $20,368.78 JJ Dogtopia Ltd. 2624 Noble Road, Cleveland Heights Date filed: March 7, 2018 Date released: July 25, 2018 Type: Employer’s withholding Amount: $14,316.73

JJ JL Associates Inc. 23775 Commerce Park Road, Beachwood Date filed: Oct. 15, 2010 Date released: July 13, 2018 Type: Employer’s withholding Amount: $14,034.73 JJ Sun Shade Landscaping LLC 9901 Applewood Drive, North Royalton Date filed: Jan. 10, 2018 Date released: June 6, 2018 Type: Employer’s withholding, failure to file complete return, corporate income Amount: $10,441.57 JJ Farone Heating & Plumbing Inc. 6360 Maplewood Road, Mayfield Heights Date filed: Feb. 4, 2009 Date released: May 17, 2018 Type: Employer’s withholding Amount: $10,256.60

Litigate.

Win. Repeat.

JJ VNTG Home LLC 1453 E. 36th St., Suite 4202, Cleveland Date filed: July 25, 2018 Type: Employer’s withholding, unemployment Amount: $36,471.96 JJ Euclid Foreign Motors Inc. 20020 St. Clair Ave., Euclid Date filed: July 25, 2018 Type: Employer’s withholding Amount: $34,635.47 JJ Buffex Metal Finishing Inc. 1935 W. 96th St., Suite L, Cleveland Date filed: July 25, 2018 Type: Corporate income, employer’s withholding, failure to file complete return, unemployment Amount: $27,952.03 JJ M Boss Inc. 4510 E. 71st St., Suite 12 Date filed: July 25, 2018 Type: Employer’s withholding, unemployment, corporate income Amount: $27,939.05

Ulmer is Benchmark’s Ohio Litigation Firm of the Year…Again.

JJ Stroud-Lawrence Funeral Home 516 Washington St. Suite D, Chagrin Falls Date filed: July 13, 2018 Type: Employer’s withholding Amount: $27,862.20

We are honored to be named “Ohio Litigation Firm of the Year”

by Benchmark Litigation for an unprecedented third year.

Ulmer’s litigation team remains at the top, endorsed by the continued trust and confidence of our clients:

JJ Eye Place Inc.

8099 Columbia Road, Olmsted Falls Date filed: July 25, 2018 Type: Employer’s withholding, corporate income Amount: $24,800.36

“Exceptionally talented — client-centric, and they get results.”

JJ Savor Al Inc. 32950 Walker Road, Avon Lake Date filed: July 25, 2018 Type: Employer’s withholding Amount: $23,208.91

“Incredibly strong, strategic, and effective litigators.”

JJ Castle Landscaping Inc. 7919 Sugarbush Lane, Gates Mills Date filed: July 25, 2018 Type: Employer’s withholding, corporate income Amount: $18,550.68 JJ Foiltek Inc. 1700 London Road, Cleveland Date filed: July 25, 2018 Type: Failure to file complete return, unemployment Amount: $17,238.71

P017_CL_20181029.indd 17

CLEVELAND

COLUMBUS

CINCINNATI

CHICAGO

BOCA RATON

ULMER.COM/LITIGATION

10/25/18 4:04 PM

PA G E 18

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Focus

The the

HEALTH CARE

HEALTH CAMPUS IS UNIFIED HUB The Sheila and Eric Samson Pavilion is being constructed on the main campus of the Cleveland Clinic. (Photographs by Ken Blaze for Crain’s)

Clinic-Case venture can ‘reduce silos’ between medical, dental and nursing students

By LYDIA COUTRÉ lcoutre@crain.com @LydiaCoutre

The spacious, bright, 485,000‑ square-foot building taking shape on Cleveland Clinic’s main campus has a lofty goal: to revolutionize health care education as we know it.

Sitting on 11 acres, the project — a joint venture between Cleveland Clinic and Case Western Reserve University — is on budget and on time. Named in honor of a “signifi‑ cant” gift of an undisclosed amount received over the summer, the Sheila and Eric Samson Pavilion at the Health Education Campus of Case Western Reserve University and Cleveland Clinic is scheduled to open in summer of 2019.

The Clinic and CWRU are more than halfway through their joint fund‑ raising for the $515 million project.

The new facility will bring together medical, dental and nursing students under one roof to encourage inter‑ disciplinary learning and the teambased care that is becoming so criti‑ cal in today’s health care world.

“I kind of like to think of it as sort of the Parthenon on top of the Acropo‑ lis,” said Dr. James Young, chief aca‑ demic officer at Cleveland Clinic.

“It’s a large temple of learning fo‑ cused on health care delivery. And you hear me very carefully saying ‘health care delivery’ because we’re trying to get the focus away from medical, nursing, dental, the tradi‑ tional silos of health care that had ex‑ isted previously and focus on how we

P018_019_CL_20181029.indd 18

can interact in a little bit better way with respect to professional educa‑ tion.”

The plan, initiated by former Clinic CEO Dr. Toby Cosgrove and CWRU president Barbara R. Snyder, was to build a new medical education build‑ ing, said CWRU spokeswoman Chris Sheridan.

“But then as the planning began for the medical education building, it

“One of the things we wanted to do ... was to try to leave as much flexibility for the future of health care training as possible.”

— Chris Connell, chief design officer at Cleveland Clinic

increasingly became clear that if we really wanted to encourage collabo‑ ration and reduce silos,” she said, “the best first step to doing that would be to reduce actual barriers — i.e. walls between buildings — and put the students together in one sin‑ gle space where they would interact regularly both in classes and in din‑ ing and in social situations, so they would really come to know each oth‑

The Cleveland Clinic’s chief design officer, Chris Connell, calls the large, shared indoor courtyard of the four schools the building’s living room, made for study or socializing.

er well interpersonally and in terms of what skills and knowledge and policies and procedures each respec‑ tive profession had, and how they can be complementary.”

In its early iterations, the Health Education Campus was made up of four buildings, one for each of the schools: The CWRU School of Medi‑ cine, Cleveland Clinic’s Lerner Col‑ lege of Medicine, CWRU School of Dental Medicine and the Frances Payne Bolton School of Nursing at CWRU. But ultimately, leaders decided that the four buildings would uphold the very silos the campus was trying to break down.

Instead, the four schools stand in the four corners of one unified build‑ ing, around a large, shared indoor courtyard that reaches from the first floor to the roof. Chris Connell, the Clinic’s chief design officer, calls this the building’s “living room,” where students can gather to study or so‑ cialize. Circling the courtyard are four floors of learning spaces and fac‑ ulty/administrative offices.

Also under construction, across Chester Street, is the dental clinic building, a three-story 126,000-square-foot structure where students can treat patients under dental faculty supervision.

Both facilities are designed by London architects Foster & Partners.

The Health Education Campus broke ground in October 2015. The dental clinic broke ground in October 2017.

Design throughout the Health Ed‑ ucation Campus’ main building fea‑ tures simple finishes, lots of natural

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CRAIN’S CLEVELAND BUSINESS

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PA G E 19

HEALTH CARE

“We do not have a model; we have created the model.”

— Dr. James Young, chief academic officer at Cleveland Clinic

The $515 million project sits on 11 acres and is a joint venture between the Cleveland Clinic and Case Western Reserve University.

light and plenty of room for flexibility and growth.

“One of the things we wanted to do with the building was to try to leave as much flexibility for the future of health care training as possible,” Connell said. “Nobody quite knows how health care will develop in the future. So it’s very important that education, which is the core of it, is at least as flexible.”

They’ve set aside space for the yetto-be-invented technology of the future.

“I like to say it’s not ‘state-of-theart,’ but I like to say it’s ‘state-of-thefuture,’ ” Young said. “People often ask, ‘(How) do we know what the future is?’ My response is, ‘Well, if you

create the future, you’re going to know what it is, so we’re creating.’ ” Already, the building will have high-tech electronics for education and for communication within the building and the different campuses in town, Young said.

For instance, the Health Education Campus will be cadaver-less. Anatomy, traditionally taught with cadavers, will be taught using virtual and augmented reality, such as Microsoft’s HoloLens. The Clinic also partnered with Zygote Medical Education to develop a virtual reality-based clinical anatomy curriculum for students.

Cadavers will be available for students elsewhere, but leaders don’t

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anticipate them being used much in the future, Connell said.

“They’ll be able to see, in technological ways, what you can’t even see with the naked eye normally,” said Ben Vinson, provost and executive vice president. “And so this creates the ability for students, once they

leave this experience, to be better prepared than ever for two things: for medical practice and health care delivery, but also for the type of peer health care provision that really kind of marks where the profession is headed in the 21st century.”

The building also broadens the opportunity for distance learning and enables the schools to deliver curriculum content around the world, Young said.

Alongside that, many students who come from other countries to learn in the building will take back with them “the cutting-edge ways in which interprofessional education

can be delivered,” Vinson said.

Young stresses that this is a completely new approach to health care education. When looking at what’s been done and what the Clinic and CWRU are doing, there are “vast differences.”

“We do not have a model; we have created the model,” he said.

Vinson said this project is a “feather in the cap” for Cleveland and the region, already known worldwide for its health care industry. He expects that it will attract students and faculty from around the world.

“And so I think as we search deep for the essence of what Cleveland is, we at Case Western Reserve are actually giving a solution in the sense that we are really elevating the prominence of health care not just in its delivery but in how it’s conceived, how it’s taught, how it’s learned,” Vinson said. “And that’s going to be something new and elevate the city even further.”

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CliniSync is coveted link for health systems

By LYDIA COUTRÉ lcoutre@crain.com @LydiaCoutre

In a region with so many choices for where patients can receive care, they’re bound to wind up visiting different health systems and hospitals.

Historically, hopping between hospitals often put the onus on the patient to lug their medical record between health systems that weren’t connected through their electronic health records. But several years ago, the nonprofit CliniSync began working to serve, effectively, as the plumbing between disparate systems to help them share patient data.

In the past several years, CliniSync has made significant progress in connecting hospitals and health systems across the state to its health information exchange. Although there still are several in the state that haven’t linked up to the network, a vast majority have. Currently, 156 hospitals are contracted with CliniSync, and 151 of those are live. In Northeast Ohio, all hospitals are on board.

The connections have been driven not by CliniSync, but by providers

and organizations making it happen, said Dan Paoletti, CEO of CliniSync.

“All of the hospitals up there have been just tremendous champions in doing this, and independent provider organizations are coming on board now,” he said. “They really deserve credit.”

With so many hospitals now linked, CliniSync is looking to connect other organizations to the exchange: behavioral health facilities, EMS and fire department personnel, pharmacists, specialty groups, social service agencies and community organizations.

The broader the network of people accessing this data, the more cost effective, quality care patients can receive, providers say.

Connection Before CliniSync, some health systems were able to connect their data with one another through a sometimes cumbersome process. In some cases, systems with a common electronic health record vendor had the option to connect. But without a common framework, systems were stuck doing one-to-one connections

for each hospital or system in a “very painful” process, said Craig Martin, IT director for population health for Cleveland Clinic, who called CliniSync a “huge win.”

“This allows us to really understand the patients that we’re caring

“All of the hospitals up there have been just tremendous champions in doing this, and independent provider organizations are coming on board now. They really deserve credit.”

— Dan Paoletti, CEO of CliniSync

for; what’s happening to them outside of our walls,” Martin said. “And especially in this day in age, when there’s so much of a focus on, you know, moving away from volume-based care toward value-based care, where we need to understand the full picture of what’s happening

with our patients, this is a critical piece in that equation.”

For Lake Health, connecting to CliniSync was “a no-brainer,” said Jerry Peters, the system’s chief information officer and vice president for information technology.

“It’s rare that there is such enthusiasm with implementing technology, but this truly does provide clinical data that we simply did not have in the past,” said Linda Gleespen, chief nursing informatics officer and system director for clinical information systems for Summa Health. “So it is invaluable what it has brought for us: cost efficiencies, lack of duplication of tests because you now see and know that these tests may or may not have been performed.”

Benefits Having access to that broader network of data has meant more cost-effective care, with fewer duplications of tests and better insight for providers.

MetroHealth’s providers reported that nearly 90% of the time they didn’t order a test they’d been planning to order before looking at the outside information, said Dr. David Kaelber, chief medical informatics officer for MetroHealth. And almost 20% of the time when providers were considering admitting a patient to the hospital, the CliniSync data gave them a more holistic picture to decide that the admission wasn’t necessary, he said.

CliniSync also is key for its ability for providers to send direct messages between systems. Historically, connections have always been on the “pull” end of the push/pull continuum, Kaelber said, meaning that in-

formation could be pulled or queried from another system. But in order to get a message to a provider in a different system, docs would have to wait until that other provider “pulled” that information, which might not be until the next time that patient is in their office. CliniSync enables providers to “push” messages to one another in a way that complies with federal patient privacy laws.

This direct messaging brings the potential for hospitals to communicate with non-health care providers, if it’s been approved by the patient.

For the past two months, for instance, MetroHealth has been live with a program that connects some of its sites to be able to send secure messages to United Way if providers identify a social determinant of health need in a patient.

“And then there’s the potential that once United Way works with the patient and sort of figures out what’s going on, then they can communicate with us so that we know what that intervention was,” Kaelber said.

University Hospitals, too, is using CliniSync in a creative way. In addition to allowing providers to access individual patient data, CliniSync is enabling broader analytics of data.

UH has been using datasets from the health information exchange for its population health purposes.

“So if I have a patient that I’m responsible for under a value-based arrangement, we have to report quality metrics to the payers,” said Bradley Hillard, senior medical director for UH’s quality care network. “And having the ability to analyze that dataset of our covered lives from CliniSync will help us close gaps with information that we didn’t previously have.”

SEE CLINISYNC, PAGE 26

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Metro takes multifaceted stance in opioid battle

By LYDIA COUTRÉ lcoutre@crain.com @LydiaCoutre

As the opioid epidemic claims the lives of tens of thousands of Americans every year, MetroHealth has been fortifying its battle against the crisis, accelerating its work within the past couple of years.

Dr. Joan Papp has been one of the physicians in the system leading the charge. She, like millions of Americans, knows someone who’s struggled with opioid misuse and addiction. Seeing family members struggle with prescription opioid misuse had a “big impact” on Papp.

“I felt like there was a lot of stigma around it, and I didn’t think that we had a comprehensive approach to the most serious of all adverse effects of opioids: for one, overdose death,” said Papp, an emergency physician who serves as medical director of MetroHealth’s Office of Opioid Safety. “And we certainly weren’t taking a comprehensive look at it systemwide. And I felt like you know, maybe I’m the person to do this, because I had a perspective that other people may not have.”

Today, MetroHealth is taking a multifaceted approach to combat the opioid crisis, from prevention to education to treatment to legal remedies.

The system has joined various task

forces, supported awareness campaigns and worked to train providers and law enforcement. It has helped push for state legislation to increase access to the overdose-reversing drug naloxone, pursued litigation against opioid drug manufacturers and marketers and curbed opioid prescribing among its providers, slashing prescriptions by 3 million opioid pills over an 18-month period.

Last year, the health system created an office dedicated to much of this work: The Office of Opioid Safety.

“That’s huge leadership for them to do that,” said Scott Osiecki, CEO of the Alcohol, Drug Addiction and Mental Health Services (ADAMHS) Board of Cuyahoga County. “They’re actually taking this very seriously — not that the other hospitals aren’t, of course. But they really want to make sure that the community understands the dangers.”

Overdose reversals Papp saw the dangers firsthand in the emergency department, where patients would come through the door experiencing an overdose, withdrawal or other medical complications from drug use or addiction, regardless of whether patients recognize it.

Overdoses were the first space in which Papp felt she could make a difference by providing a dose of naloxone, a drug that blocks or reverses the

effects of opioid medication overdose.

She wanted to get naloxone into the hands of everyone who might need it.

Thus started Project DAWN (Deaths Avoided With Naloxone), which launched in 2013. It was Papp’s first initiative in opioids and the system’s second major effort, following a mother and child dependency program.

Papp and the system spent four years integrating Project DAWN throughout the hospital and community, building five walk-in naloxone distribution sites, integrating it into the emergency departments and stocking the system’s inpatient and retail pharmacies. MetroHealth helped get naloxone for county law enforcement and partnered with Cleveland EMS to distribute naloxone on the trucks and start a walk-in clinic.

In tandem, the system advocated for changes in state law to increase access to naloxone. A few years ago, MetroHealth was successful in getting a couple of laws passed that, among other things, allowed police officers to administer naloxone, allowed non-physician trained opioid educators to distribute naloxone and enabled those not at personal risk to get their hands on a naloxone kit.

By the end of 2018, Project DAWN will have distributed an estimated 12,000 naloxone kits since its inception. More than 1,800 overdoses have been reversed with these kits — a con-

Dr. Joan Papp is one of the physicians leading the charge for MetroHealth in its fight against the opioid epidemic. (Contributed photo)

servative estimate that only accounts for those reversals reported to the system. MetroHealth trained its own police department on how to administer naloxone, and has in the past few months already reversed roughly a dozen overdoses at the hospital.

Education and prevention Having gotten naloxone out in the community, Papp said the system also looked to treatment and prevention efforts and ways to develop an educational curriculum for providers and others. The Office of Opioid Safety, which now has a dozen employees, provides education and training to county law enforcement, to physicians and to the community.

At this point, most physicians in the

system have gone through mandatory educations on safe opioid prescribing, use, storage and disposal. The system also offers monthly lunch-and-learn programs centered around opioids, as well as an optional simulation program in which providers conduct a visit with an actor and work through how to discuss difficult, common scenarios around opioids.

In late August, the system announced it is taking legal action as part of a multidistrict litigation against opioid drug manufacturers and marketers, looking to hold them accountable for the increasing costs MetroHealth will continue to incur as a result of the opioid epidemic.

For about a year, MetroHealth has had an opioid executive committee that meets regularly to review pre-

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HEALTH CARE scribing data for the hospital, to determine trends, to see if progress is being made and to identify which providers might need additional resources or education on prescribing.

The system has established a number of tools in the electronic health record to make it “easier for prescribers to do the right thing,” Papp said. For instance, it lowered the default number of pills that come up when selecting a prescription to a recommended, safe number of pills. MetroHealth established alerts for doses over recommended guidelines, for any prescriptions that are dangerous to prescribe with other medications the patient is on and for patients who may be at risk of addiction, guiding them to alternative medications, lower doses or other options. The system also has an alert to recommend that providers co-prescribe naloxone with any opioid prescription.

These efforts, along with provider education, have culminated in the system drastically lowering the amount of opioid pills it’s prescribing. MetroHealth doctors and nurse practitioners prescribed 3 million fewer opioid pills over an 18-month period, reducing the number of opioid pills prescribed for acute pain by 62% and for chronic pain by 25%.

Treatment With all of MetroHealth’s education, advocacy and prevention efforts, it is still treating many patients struggling with addiction. And the system is working to expand those efforts, most recently with its acquisition of Recovery Resources, announced in early October.

The acquisition of the community-based outpatient behavioral health services organization grants MetroHealth patients access to specialized care for behavioral health and disorders from Recovery Re-

sources professionals, and Recovery Resources clients will have access to the health system’s services, including primary and preventive care.

Recovery Resources’ work adds to MetroHealth’s other efforts in treatment, including a small medication-assisted treatment program that opened about a year and a half ago. There, providers prescribe buprenorphine or suboxone to treat opioid use disorder.

MetroHealth in the past year and a half has ramped up the number of providers able to prescribe suboxone, offering a handful of workshops.

Today, there are 81 providers who have completed the eight-hour mandatory training to be able to prescribe and manage patients with suboxone or buprenorphine.

And the support doesn’t end there.

The system has partnered with Ascent ED, which connects emergency department patients with peer supporters. It also launched quick response teams, made up of a MetroHealth social worker and a police officer, to respond to the home where an overdose occurred within seven days to provide resources and direct pathways to treatment and education, as well as naloxone kits. If the overdose survivor is prepared to enter treatment, the teams will coordinate that process.

The system is looking to build upon all of the various programs that have been started in recent years, said Emily Metz, manager of the Office of Opioid Safety at MetroHealth.

She said it’s important for the system to tackle the opioid epidemic from numerous approaches, because “these are our patients.”

“And it’s not only our patients, but it’s our staff, too,” she said. “This epidemic touches every part of our society. It’s an epidemic. So we’re devoted to responding to the needs of our community, and this is one of the most emergent needs out there.”

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Q&A: Josette Beran

Chief strategy officer, Cleveland Clinic Josette Beran, Cleveland Clinic’s new chief strategy officer, is no stranger to the system and its operations. ¶ She’s held numerous management and leadership roles in her nearly 18 years at the Clinic, and draws on that experience in her new role as she helps the system work on its five-year strategy. ¶ As the Clinic grows abroad and in other areas of the United States, “everything that we do is focused in on Cleveland,” she said. “This is where we’re based, and the Cleveland community is very important to Cleveland Clinic.” ¶ Crain’s spoke with Beran about her work and vision for the Clinic’s strategy. The conversation has been edited lightly for brevity and clarity. — Lydia Coutré How did you come to join the strategy office in 2014, and why were you interested in that work?

I was coming back from Cleveland Clinic Abu Dhabi, actually, where I spent three years. I’ve been at the Clinic for a number of years. Now I’ve been here almost 18 years. So I’ve had a long tenure here. Coming back from Abu Dhabi, I was interested in opportunities to grow and provide value to the organization. So I took a role in the strategy office where I could do partnering and integration, which was somewhat similar to the work that I had done in Abu Dhabi standing up Cleveland Clinic Abu Dhabi with integration work. So it was a nice match.

You led the development of the proposals to advance the Clinic’s network in Florida, including bringing in Indian River Medical Center and Martin Health System.

Why were those important moves for the Clinic and how did you approach them?

The Cleveland Clinic is always looking for opportunities to grow and be able to serve our patients. And so we had already experienced a lot of success with our Weston facility, and with that success we actually expanded to a new bed tower recently that just

opened, and also a new family health center in Coral Springs. And we did those things because there was significant demand for us serving our patients. And so with that growth and opportunity to expand, we had other potential partners reach out and express interest and you know, the timing was such that as we thought about continuing to grow and serve patients in Southeast Florida, it made sense to consider the relationships with Martin and Indian River. And so we had been working with them and have recently executed agreements that are currently under regulatory review.

So you’ve been in the strategy office for a little bit now. You’ve worked under Dr. (Toby) Cosgrove, also. Has having a new leader of the Cleveland Clinic, Dr. (Tom) Mihaljevic, changed the approach of the strategy office at all or the direction of it?

In my former role, I worked under Dr. Cosgrove’s leadership. Dr. Mihaljevic and I had the opportunity to work in Abu Dhabi together. Since he’s been back, he has wanted to take another look at our strategy, and so we’ve been engaged in just refreshing our strategy over the past several months.

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HEALTH CARE Cleveland’s Gourmet Gift Connection

How do you approach the process of developing and implementing a new strategy, or refreshing it?

We’ve been working with a large number of stakeholders at the Cleveland Clinic. It’s important for us to make sure that we collectively define our path forward together. ...

The actual plan is a five-year plan where we will look at those initiatives that we feel are most valuable to drive and propel our organization forward. It’s critically important that as we engage our stakeholders, we’re communicating with them so that they fully understand the strategy, and most importantly how they personally relate to that strategy.

And while you’re still working on that plan, do you have any specific goals in your new role?

I’ve been at the Clinic now, like I said, for 18 years. And really my focus is how do I help to ensure that Cleveland Clinic provides exceptional,

high-quality, compassionate patient care? And I think in order to do that, another goal of mine is really to focus in on what are the capabilities that the Cleveland Clinic needs to execute on that strategy. And then finally, I think having been here for a number of years, it is important for us to prioritize this work. And I’d say really the last thing as far as a high priority for me is being able to prioritize our work as it relates to the strategy so that we’re able to deliver and execute.

What are the biggest challenges you face in the strategy office and in your work?

Well I think it’s just like anything else in health care. It’s the speed at which health care is moving. And the rapidity at which things change. It’s no different for the strategy office.

As you’re working on this fiveyear plan, what are some of the biggest opportunities you see going forward? What are you really focusing on in that work?

As I think about the change and how quickly things are moving, the Clinic doesn’t only want to be able to stay up with the changes. We actually want to be able to lead in this space. When I mentioned before the capabilities I think we need, that is focusing on our caregivers and making sure we invest

in our caregivers, so this is the best place for them to work and to learn and grow because ultimately that will help with delivering on that patient care that is so important. I think focusing our caregivers and the different types of caregivers we need is a critical focus. Again as health care continues to transform, there are new roles all the time that are critically important. Technology is absolutely key to how we can better serve our patients and our community. And I think how we can work smarter, more affordable and have more accessible care. And then just transitioning again our care model to better serve our patients. And we are really trying to listen to the needs of our patients and our communities, and understand what type of care they want and where they want to receive that care. Education is another big component. And so we have invested in a new health education campus where we’ll bring different students together to work in teams in how they deliver care.

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Medicaid increases for providers are on way

By VIRGIL DICKSON Modern Healthcare

Providers across the country can expect to score higher Medicaid reimbursement next year, but inpatient hospitals may see cuts or rate freezes, according to a state Medicaid survey released on Thursday, Oct. 25.

Forty-seven states plan to offer at least one provider type a rate increase in fiscal 2019, Kaiser Family Foundation’s survey showed. That could include primary-care doctors, specialists, home care aides or nursing homes. While at least one provider type in 31 states can expect a rate

“The relatively stable economies in most states has led to more making or planning to make provider rate increases.”

— Barbara Edwards, a senior fellow at Health Management Associates

decrease, that’s the smallest number of rate restrictions since fiscal 2008.

“The relatively stable economies in most states has led to more making or planning to make provider rate increases,” said Barbara Edwards, a senior fellow at Health Management Associates, which helped conduct the survey.

Specifically, 12 states including California and Kentucky said they

plan to increase rates for primary-care doctors. Another 14 plan to offer specialists higher reimbursement, and 21 will do so for outpatient hospitals.

On the flip side, 27 states including Florida and Texas said they plan to cut or freeze rates for inpatient hospitals, according to the report.

States did not explain why inpatient hospitals were not on the list for

raises next year, Edwards said.

Twenty-four states, including Indiana and Colorado, also are planning to expand Medicaid benefits next year. The most common benefit enhancements include mental health and substance use disorder services, physical and occupational therapies, screening and home visiting services for pregnant women and children.

In a separate spending report issued on Thursday, states reported for the first time in a decade that there was no net growth in Medicaid enrollment during fiscal 2018. Overall enrollment growth declined slightly by 0.6% that year, according to the report.

Those findings echoed a Medicaid

Health Plans of America report issued earlier last week.

States again claimed that the economy and positive fiscal conditions are contributing to flat enrollment growth, according to Robin Rudowitz, associate director for the Kaiser Family Foundation’s Program on Medicaid and the Uninsured.

As people find better or more employment opportunities, they aren’t needing Medicaid coverage, the report stated.

Dickson is Washington bureau chief of Modern Healthcare, a sister publication of Crain’s Cleveland Business.

CLINISYNC CONTINUED FROM PAGE 20

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With many of the hospitals across the state connected to the health information exchange, CliniSync is now targeting unique groups, including other providers (such as behavioral health facilities, home health and long-term care), as well as nonhealth care providers, such as social service agencies and community organizations.

“So that whole continuum is so important,” Paoletti said. “Even though we focus a lot on the hospital side, we had to start there, but there’s so much more to do.”

“It’s rare that there is such enthusiasm with implementing technology, but this truly does provide clinical data that we simply did not have in the past.”

— Linda Gleespen, chief nursing informatics officer and system director for clinical information systems for Summa Health

CliniSync is also working with pharmacies and health plans, as well as EMS providers to get them the information before they even reach the patient.

“It’s getting closer and closer to that full integration where you know, in that dream world, someone shows up at whatever organization and you as the provider can walk in and know, have the ability to know what’s happened to them all along their medical course,” said Dr. Sarah Rush, chief medical information officer at Akron Children’s.

Paoletti stressed CliniSync is the invisible partner in all of this. About half of all users have the system integrated into their native electronic health system, while others access CliniSync through a separate portal.

And it’s truly the providers, hospitals and health systems that have made the connections possible.

“It’s not about competition, it’s about collaboration among our communities,” said Summa’s Gleespen. “So I think it’s really demonstrated how competing orgs are coming together in true spirit of collaboration for the benefit of our patients, providers and our organizations.”

10/26/18 3:30 PM

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THE LIST

Largest Hospitals

Ranked by 2017 net patient revenue NET PATIENT REVENUE (MILLIONS) THIS YEAR HOSPITAL (1)

2017

2016

% CHANGE

STAFFED BEDS

FTE STAFF 9-1-2018

YEAR FOUNDED

PARENT ORGANIZATION

TOP EXECUTIVE

1

Cleveland Clinic 9500 Euclid Ave., Cleveland 44195 (216) 444-2200/clevelandclinic.org

$4,858.7

$4,688.9

3.6

1,265

30,815

1921

Cleveland Clinic Health System

Tomislav "Tom" Mihaljevic president, CEO

2

University Hospitals Cleveland Medical Center 11100 Euclid Ave., Cleveland 44106 (216) 844-1000/uhhospitals.org

$2,383.8

$2,226.1

7.1

971

16,365

1866

University Hospitals

Daniel I. Simon president

3

VA Northeast Ohio Healthcare System 10701 East Blvd., Cleveland 44106 (216) 791-3800/cleveland.va.gov

$1,074.5 (2)

$1,029.7 (2)

4.3

674

4,801

1946

Department of Veterans Affairs

Susan M. Fuehrer healthcare system director, CEO

4

The MetroHealth System 2500 MetroHealth Drive, Cleveland 44109 (216) 778-7800/metrohealth.org

$963.8

$895.4

7.6

424

6,833

1837

The MetroHealth System

Akram Boutros president, CEO

5

Akron Children's Hospital (3) One Perkins Square, Akron 44308 (330) 543-1000/akronchildrens.org

$774.2

$714.9

8.3

434

4,998

1890

Children's Hospital Medical Center of Akron

William H. Considine CEO

6

Summa Health System — Akron and St. Thomas Campuses 525 E. Market St., Akron 44309 (330) 375-3000/summahealth.org

$661.1

$670.5

(1.4)

509

3,926

1892 and 1922

Summa Health System

Cliff Deveny interim president, CEO

7

Cleveland Clinic Akron General Hospital One Akron General Ave., Akron 44307 (330) 344-6000/akrongeneral.org

$590.4

$589.1

0.2

391

4,477

1914

Cleveland Clinic Health System

Brian Harte president

8

Fairview Hospital 18101 Lorain Ave., Cleveland 44111 (216) 476-7000/fairviewhospital.org

$474.6

$476.3

(0.4)

426

2,343

1892

Cleveland Clinic Health System

Neil P. Smith president

9

Hillcrest Hospital 6780 Mayfield Road, Mayfield Heights 44124 (440) 312-4500/hillcresthospital.org

$445.7

$427.1

4.4

444

2,155

1968

Cleveland Clinic Health System

Richard Parker president

10

Aultman Hospital 2600 Sixth St. S.W., Canton 44710 (330) 452-9911/aultman.org

$407.5

$386.9

5.3

554

5,757

1892

Aultman Health Foundation

Christopher E. Remark CEO

11

Mercy Health — St. Elizabeth Youngstown Hospital 1044 Belmont Ave., Youngstown 44501 (330) 746-7211/mercy.com/youngstown

$367.6

$325.2

13.0

382

1,827

1911

Mercy Health

John Luellen chief operating officer

12

Southwest General 18697 Bagley Road, Middleburg Heights 44130 (440) 816-8000/swgeneral.com

$355.8

$333.4

6.7

287

1,912

1920

Southwest General, partnering with University Hospitals

William A. Young Jr. president, CEO

13

Firelands Regional Medical Center 1111 Hayes Ave., Sandusky 44870 (419) 557-7400/firelands.com

$239.2

$232.7

2.8

236

2,700

1876

Firelands Regional Health System

Jeremy Normington-Slay president, CEO

14

University Hospitals Elyria Medical Center 630 E. River St., Elyria 44035 (440) 329-7500/UHElyria.com

$221.4

$229.4

(3.5)

234

1,122

1908

University Hospitals

Kristi M. Sink president

15

University Hospitals Ahuja Medical Center 3999 Richmond Road, Beachwood 44122 (216) 593-5500/UHAhuja.org

$212.9

$212.1

0.4

138

868

2010

University Hospitals

Susan V. Juris president

16

Mercy Health – Lorain Hospital 3700 Kolbe Road, Lorain 44053 (440) 960-4000/mercy.com

$203.0

$197.2

2.9

317

1,038

1892

Mercy Health

Edwin M. Oley senior vice president Mercy Health; CEO Mercy Health - Lorain

17

Mercy Health — St. Elizabeth Boardman Hospital 8401 Market St., Boardman 44512 (330) 729-2929/mercy.com/youngstown

$193.9

$181.8

6.6

193

842

2007

Mercy Health

Eugenia "Genie" Aubel president

18

West Medical Center 36000 Euclid Ave., Willoughby 44094 (440) 953-9600/lakehealth.org

$185.3

$180.1

2.9

267

2,169 (4)

1961

Lake Health

Cynthia Moore-Hardy president, CEO

19

TriPoint Medical Center 7590 Auburn Road, Concord Township 44077 (440) 375-8100/lakehealth.org

$182.6

$177.5

2.9

135

2,169 (4)

2009

Lake Health

Cynthia Moore-Hardy president, CEO

20

University Hospitals Parma Medical Center 7007 Powers Blvd., Parma 44129 (440) 743-3000/UHParma.org

$179.9

$190.5

(5.6)

282

952

1961

University Hospitals

Peter U. Bergmann president

21

Mercy Health — St. Joseph Warren Hospital 667 Eastland Ave. S.W., Warren 44484 (330) 841-4000/mercy.com/youngstown

$170.1

$164.3

3.5

141

791

1924

Mercy Health

Kathy Cook president

22

University Hospitals St. John Medical Center 29000 Center Ridge Road, Westlake 44145 (440) 835-8000/UHStJohn.org

$157.9

$177.5

(11.1)

180

805

1981

University Hospitals

Robert G. David president

23

Summa Health System — Barberton Campus 155 Fifth St. N.E., Barberton 44203 (330) 615-3000/summahealth.org

$156.6

$161.1

(2.8)

118

836

1915

Summa Health System

Michael Hughes president

24

University Hospitals Geauga Medical Center 13207 Ravenna Road, Chardon 44024 (440) 285-6000/UHGeauga.org

$150.8

$153.3

(1.6)

158

708

1952

University Hospitals

M. Steven Jones president, Community Hospitals East

25

St. Vincent Charity Medical Center 2351 E. 22nd St., Cleveland 44115 (216) 861-6200/stvincentcharity.com

$146.7

$154.7

(5.1)

213

922

1865

Sisters of Charity Health System

David F. Perse president, CEO

26

Marymount Hospital 12300 McCracken Road, Garfield Heights 44125 (216) 581-0500/marymount.org

$141.0

$148.2

(4.8)

284

897

1949

Cleveland Clinic Health System

Daniel Napierkowski president

RESEARCHED BY CHUCK SODER (CSODER@CRAIN.COM) AND KASEY HARIMAN (KHARIMAN@CRAIN.COM)

Want the full Excel version of this list — and every Crain's list? Become a Data Member: CrainsCleveland.com/data The full digital list includes 46 hospitals and names of additional executives. Information is submitted by the hospitals unless footnoted. Send feedback to Chuck Soder: csoder@crain.com

(1) Hospital revenue and employment numbers often include outpatient clinics and other offsite locations affiliated with the hospital. (2) Total operating budget for all locations in Northeast Ohio; includes flat annual per patient payments (3) Includes data for the main campus and Akron Children's Hospital Mahoning Valley (4) This number includes all Lake Health employees.

P027_CL_20181029.indd 27

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AKRON

Summit Lake area looks to a fresh future

By BETH THOMAS HERTZ clbfreelancer@crain.com

With a report released this summer showing that the water quality in Akron’s Summit Lake is better than previously thought, plans that were already underway to work closely with residents to rejuvenate the area have been given new life and new leverage.

The Summit Lake Vision Plan — being developed through the Akron Civic Commons, the city of Akron, Summit Metro Parks and the Ohio & Erie Canalway Coalition — proposes many improvements that would encourage people to come to the area that has been underutilized in recent decades. Ideas include a lighted fountain in the lake and an amphitheater area. Also proposed are a marble-themed artistic display/play area, boat ramps, kayak/canoe rentals, a splash pad, a boardwalk and road improvements.

Beyond improvements to the lake itself, civic leaders hope the efforts eventually lead to development — such as more retail and accessible stores — that will help the historically

P028_CL_20181029.indd 28

Akron officials are hoping development will come to Akron’s Summit Lake neighborhood. Civic leaders are also committed to making the entire lake accesible to the public. (Shane Wynn for Crain’s)

struggling neighborhood. But working with the residents on any project is of utmost importance, they say.

Daniel M. Rice, president and chief executive officer of the Ohio & Erie Canalway Coalition, said there is no timeline for the proposed lake im-

provements, as the cost and source of funding is still to be determined.

“We are committed to implementing the ideas in the Vision Plan, but we don’t know when. We will put together a proposed schedule and get to work,” he said. “We expect to see

much of this implemented over the next five to 10 years.”

The coalition works with more than 150 partners on the development of the Towpath Trail, part of which runs along Summit Lake, and it is the convener of the Akron Civic Commons project, an initiative funded through a grant from the John S. and James L. Knight Foundation and other groups to enhance public spaces in the area. The grant is in the last of its three years, but Rice said the partnership is committed to sticking with the project even after the grant ends.

The Vision Plan was discussed at a community meeting held in Kenmore on Oct. 17 to follow up on a meeting held in August at which residents discussed ideas to help redevelop the area that was once a popular destination, complete with an amusement park.

Leaders are intent on working closely with Summit Lake residents to ensure that development ideas are in line with what they want. Residents have been promised many things over the years by well-intentioned people and groups, Rice said, but those initiatives have often been abandoned or ignored residents’ desires.

This time, the group has met often with residents. Based on resident input, one of the first steps, in conjunction with Summit Metro Parks, was to install grills, picnic tables and a shelter near the Summit Lake Community Center and to clear brush that was obscuring views of the water.

“Before we started this project, there was only one place to sit at Summit Lake, and it didn’t even face the lake,” Rice said.

Sandy Saulsberry, a resident of the area since 1982 who has been active in the redevelopment conversations, said those first steps have already helped change neighbors’ perceptions of the lake.

“We used to go to other neighborhoods to have picnics, but we can stay here and enjoy a little piece of heaven right here now,” she said.

Saulsberry initially wasn’t on board with the plans because she’s seen promises made and not delivered over the years, she said. But this time feels different because of the commitment to listening to the community, she said.

The water quality report, released in July, confirmed what advocates for redeveloping the neighborhood already suspected — that the percep-

tion that the lake was still tainted from years of industrial abuse was out of date. In fact, the water is as clean as any area inland lake, Rice said. While swimming is still not encouraged yet, boating, canoeing, fishing and other activities are.

City of Akron planning director Jason Segedy called the report an opportunity to encourage people to use the lake more, which he said should help spur economic development in a neighborhood that is very underserved by retail — a problem worsened by the fact that many residents do not have cars.

“It’s one of the lowest-income neighborhoods in this city and a lot of businesses have left,” Segedy said.

“So with the reconstruction of the Main and Broadway interchange at I-76 and 77, which is really close, one of our goals would be to create more of a business district that could serve the neighborhood.

“That interchange is also kind of a gateway to get to the lake. Getting more businesses to fill in along Main and Broadway would be beneficial for both residents and for visitors.”

He said new businesses could include things such as coffee or ice cream shops that would help draw visitors and businesses that can meet residents’ day-to-day needs, such as drug stores or grocery stores. He’d like to see the city better utilize the economic value of the Towpath Trail, as well.

“If you look at a place like Peninsula, it’s a small town, but it has capitalized really well on having the Towpath come right through it,” he said.

And while the city would like to see more housing in Summit Lake — growing Akron’s population and increasing its housing stock are priorities for Mayor Dan Horrigan — Segedy said there aren’t any immediate plans in the works.

When the time is right, though, there is plenty of vacant land to work with — the city and the Summit County Land Bank own about half of the land in the neighborhood. That’s from the many houses acquired and demolished in the foreclosure crisis.

The city also owns about 3 acres on the northwest side of the lake, where Margaret Park Elementary School once stood.

Summit Lake has some of the lowest real estate values in Akron, which makes it a challenge to lure developers.

“If the resale value is one-fifth of the cost of building a new home, it is going to be very difficult to entice a home builder or developer to come in and (develop) in a way that honors and stabilizes the folks that are living there and have stayed through the foreclosure crisis,” said James Hardy, the city’s chief of staff.

Hardy said the city might turn some of its land into public green space for the time being.

“This is a high-priority neighborhood for us, but it’s going to take time for the development to occur in the right ways,” he said. “We don’t want to take the traditional ‘We have land, someone wants the land, we sell the land based on job creation,’ approach.”

Segedy said any new housing will likely start on a small scale and would probably be near the lake. However, because the city wants to keep the entire lake directly accessible to the public, any development must incorporate a buffer zone to ensure access isn’t impeded.

10/26/18 3:31 PM

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For Akron, the future is female — and diverse

By JUDY STRINGER clbfreelancer@crain.com

When Heather Roszczyk joined the city of Akron as its innovation and entrepreneurship advocate last year, the nonprofit leader looked forward to boosting her corporate influence with the backing of Mayor Dan Horrigan and his team.

One of the most pleasant surprises, however, has come from inside city hall itself.

“There are so many strong female leaders in the administration right now,” Roszczyk said. “It’s been incredible to work with these women on a daily basis.”

Akron deputy chief of staff Annie McFadden said, in fact, there are more women in leadership roles than the city has ever seen before. A little over one-third of Horrigan’s cabinet is female. Since he took office in January 2016, Horrigan has brought in McFadden, law director Eve Belfance and deputy law director Yamini Adkins to a 16-member cabinet, which already included female leadership in finance, director Diane Miller-Dawson, and economic development, deputy planning director Adele Dorfner Roth.

In addition, the mayor recruited women to lead key initiatives, like Roszczyk to focus on entrepreneurship and health equity ambassador Tamiyka Rose, and appointed women to newly minted leadership roles, including press secretary Ellen Lander Nischt and digital media coordinator Amanda Adey.

“The administrative staff that keeps the office running smoothly is also all women,” McFadden said. “With Mayor Horrigan, his wife is a full-time career woman and he has three daughters, so

LORAIN

CONTINUED FROM PAGE 1

The project is the work of Brent Zimmerman, best known as co-founder of Saucy Brew Works in Ohio City’s nearby Hingetown area, and Cleveland business partners Sam Messina, who oversees construction, and investor Brad Gorman.

“We see this as a pedestrian-friendly site,” Zimmerman said, where people can take public transit or bike to work. “We’re super excited.

We’ll have 32 bike garages and a place to repair them.”

There’s also parking on most of the building’s first floor, which is designed as walk-up townhouses on the West 41st Street side, as well as a small retail space on Lorain itself.

Zimmerman said he wished the group could have pursued the plan without parking — like a real city, he said — but that element is necessary for city approvals. He also was not thrilled about adding retail space at street level on Lorain required by city planners, though he sees it as a place for a coffee shop or even coworking space.

“There’s enough vacant retail space on Lorain,” he explained.

The project is a bit of a changeup, as for-sale townhouses were originally expected after an affiliate of Concord Township-based home builder Knez Homes bought the site in January 2017.

Knez sold the more than half-acre parking lot to Zimmerman’s group but retained the former Bodnar Funeral Home, 3829 Lorain Ave., which is listed for sale. Knez continues to build on a plethora of other sites within Ohio City, the Detroit-Shoreway neighborhood

P029_CL_20181029.indd 29

Women are a growing part of the city of Akron’s administration. From left, Diane Miller-Dawson, director of finance; Adele Dorfner Roth, deputy planning director for economic development; Yamini Adkins, deputy director of law; Heather Roszczyk, innovation and entrepreneurship advocate; Tamiyka Rose, health equity ambassador; Annie McFadden, deputy chief of staff; Ellen Lander Nischt, press secretary; and Amanda Adey, digital media coordinator. (Shane Wynn for Crain’s)

I think he is naturally very comfortable with women and women in leadership roles, nonetheless.”

Horrigan agrees his own family is a big influence, as are his past jobs.

Belfance He said female leaders were prevalent both at Summit County courthouses, where Horrigan was clerk of courts, and St. Vincent-St. Mary and Stow Munroe Falls high schools, where the once-longtime Akron City Council member taught before he entered politics.

The real impetus behind increasing

city hall’s female quotient, however, has more to do with effective municipal management than his personal comfort level, according to Horrigan.

Take communications strategy, for example, he said.

“If we just said, ‘Hey, this is the message; look at it,’ then we are turning a kind of tin ear on messaging,” he said. “But with a diversity of viewpoints, we have an opportunity to look at communication from a consumer’s standpoint, how the message will be perceived among the difference audiences we are trying to reach. And we are able to communicate in a more complete fashion.”

The same goes for finance, law and economic development.

“Having that diversity of thought, that diversity of perspectives definitely helps me be a better leader,” Horrigan said.

Of course, diversity extends beyond gender, and Horrigan’s vision to “bring more voices to the table” includes racial and ethnic diversity as well as a concerted effort to move younger people into leadership positions. Between the cabinet and mayor’s office, there are seven people 40 and younger, including chief of staff James Hardy, who has been getting lots of press for his less-talk-more-action attitude.

Belfance said a similar “can-do” mindset distinguishes the Rubber City female leaders. Don’t mistake a desire for diversity with quota hiring, she said.

and other parts of Cleveland, and the builder even has staked out additional sites farther west on Lorain.

Building rental apartments allows the developer to benefit from the city’s 15-year residential tax abatement program, Zimmerman said, while the buyers of residential properties, rather than the builder, gets those tax benefits. Zimmerman, for his part, declined to say how much he estimates the project will cost to build.

The apartment project also fills a different niche in Zimmerman’s real estate activities. He’s a partner with developer Fred Geis and others in the proposed 11-story Church and State project on Detroit Avenue just east of Saucy Brew Works. And it follows a 16unit townhouse he developed last year at the Avenue Townhomes downtown, which now has one suite available.

“This serves the same apartment market as downtown,” he said.

But with lower land costs on the neighborhood site, the project’s suites will rent for $1.80 a square foot, which translates into about $1,035 for a one-bedroom to $2,000 for a two-bedroom. That’s a step lower than new downtown rates focused on young professionals or empty nesters.

“This is for the people who work in downtown service industries, teachers, police and firefighters,” Zimmerman said.

Thomas McNair, executive director of the Ohio City Inc. neighborhood development corporation, called the project “a harbinger of things to come.” It launches much-sought infill development on lower Lorain, where parking lots and used car lots stand where commercial buildings have been lost over the years.

He said he thinks investment activity will increase in the future after a proposed protected two-way bike path — called a cycle track, and now in the government funding and preparatory stage — gets built.

Ohio City Inc. also wants to play a direct role in such projects. McNair said the nonprofit is doing due diligence on the purchase of the Fodor Realty Building, 3308 Lorain Ave. The building could provide contemporary offices, perhaps for the nonprofit, but has driveways on either side that access a third-acre parking lot the nonprofit would like to see redeveloped as housing, perhaps facing Penn Court and accessed from Lorain.

Councilman Kerry McCormack, whose Ward 3 includes the neighborhood, sees additional residential redevelopment of Lorain Avenue as a necessary part of redeveloping the area.

“In the 1960s, Ohio City had 20,000 people. Now it has 10,000,” McCormack said. “The unfortunate side effect is all these empty blocks where buildings once stood. If we’re serious about repopulating the city, you need to develop them to add people and support the amenities the neighborhood needs.”

The challenge will be balancing the scale, the councilman said.

“You don’t want a bungalow on such a site,” McCormack said, and Zimmerman’s project is among primarily two-story buildings, though taller old ones remain in place nearby.

Zimmerman is confident his new project will not remain alone. He envisions the hard-scrabble commercial district west of 41st Street on Lorain Avenue being redeveloped at least as far as Gordon Square.

SKYLINE

“Take any one of these women,” Belfance said, “and you will have that kind of resilience, work ethic and grit, really, that lends itself to strong leadership.”

The expanding influence of women — and diversity — in Akron city leadership could very well be considered a microcosm of a larger picture countywide.

Roszczyk rattles off names like Ilene Shapiro, who became Summit County’s first female county executive when Russ Pry died suddenly in 2016, and Summit County Council member at-Large Elizabeth Walters, who not only is one of three women on the council but one of the youngest members, too.

Then there’s Margo Sommerville, a woman of color who is president of Akron City Council, where four additional women, three of them African-American, also have seats. And women occupy courtroom benches around the county, so much so Belfance said she was surprised, after being elected to the Ohio Ninth District Court of Appeals in 2008, to be the only woman at a Columbus orientation session for new appellate judges.

“I came to realize that Summit County is a bit of an odd duck when it comes to the prominence of female judges. That was not really the case when I traveled to other parts of the state,” she said.

Unfortunately, the Akron business community is not quite so progressive, Roszczyk said.

“We still have a long way to go when it comes to seeing more women in leadership roles in our corporate sector,” she said. “I believe, however, it matters deeply when the mayor of a city chooses women to lead within his administration. It sends a strong message that there are plenty of sharp, capable female leaders in Akron and sets an example for the corporate community to follow.”

vestments to keep it up to date.

Blake Lyon, Skyline’s CEO, said in the company’s most recent earnings CONTINUED FROM PAGE 1 report that event business was down The other side of such an offering at the Renaissance and it lost about $800,000 in the first quarter of 2018 is that it’s a good time to sell hotels.

David Sangree, president of the alone. However, he said he thinks its Lakewood-based consultancy Hotel results will improve after a renova& Leisure Advisors, said he had not tion is completed. heard of the offering, but that it does Meanwhile, Skyline bought the not surprise him.

293-room Hyatt Regency at the Ar“They can probably make some cade for just $7.6 million in 2012 to money on them now,” Sangree said settle a foreclosure proceeding. Toin a phone interview. “The hotel mar- day, the property is valued for propket is at a peak. Financing is avail- erty taxation purposes at $20 million.

In the earnings reable, so there is less demand for equity. “The growth port, Lyon observed that the property, And there are many of downtown buyers looking for hothanks to renovations, had increased revenue tels across the nation.” living is also of $300,000 in the Eric Belfrage, a Coquarter, but the comlumbus-based CBRE benefiting senior vice president hotel markets.” pany did not disclose who specializes in hothe figure in profit or loss terms. Those tels, said it is unlikely — Eric Belfrage, CBRE earnings did not indithat new hotels will be senior vice president added downtown anycate a sale of the time soon. That, in turn, would make Cleveland assets might be looming.

Gil Blutrich, Skyline chairman and such sales more attractive.

“The growth of downtown living is founder, did not respond to three also benefiting hotel markets,” Bel- phone messages or a Twitter mesfrage said, as downtown residents sage, and Lyon did not return a call may have visitors but may not have by Crain’s deadline Friday morning, the space for overnight houseguests, Oct. 26. which adds to demand. “The inSkyline also made progress in leascreased vibrancy of Midwest down- ing retail space in both properties to towns is also making them more at- tenants, a step which eluded previtractive to weekend visitors.” ous owners. It filled storefront space Skyline might have quite different on both the Superior and Euclid reasons for marketing each of the ho- sides of the Arcade and added a tels. The 491-room Renaissance was handful of new interior tenants. At the city’s largest hotel until the pub- the Renaissance, it added three tenlicly funded Hilton Cleveland Down- ants at first-floor retail spaces that town Hotel opened in 2016, and the had long been significant vacancies Renaissance requires substantial in- on Public Square.

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CRAIN’S CLEVELAND BUSINESS

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PEOPLE ON THE MOVE To place your listing, visit www.crainscleveland.com/people-on-the-move or for more information, please call Debora Stein at (917) 226-5470 / email dstein@crain.com.

MBA

WEATHERHEAD SCHOOL OF MANAGEMENT

weatherhead.case.edu

ACCOUNTING

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CONSTRUCTION

FINANCIAL SERVICES

FINANCIAL SERVICES

CLA

CLA

Welty Building Company

Beacon Financial Partners

Ancora

CLA is pleased to announce the career milestone of a professional in our Akron Office, Bob Ryan, who is advancing from his role as Manager to Principal.

“Bob’s successes in the positions of manager and as a member of our Manufacturing and Distribution Industry group make him well-deserving of this career advancement. His dedication to the people he serves and helping them succeed is the embodiment of what it means to live the CLA Promise,” said Managing Principal Steve Pittman.

CLA is pleased to announce a career milestone for one of the professionals in our Canton office, Christy Erb, who is advancing from her role as Manager to Principal.

“Christy has played a fundamental role in the growth of our Nonprofit Industry group within the past two years. This advancement not only reflects her personal growth and success, but also her dedication to the community she serves,” said Managing Principal Steve Pittman. Christy has more than 12 years of audit experience.

Welty Building Company recently named Nicolas Sanloup as Vice President - Business Development of Welty Energy & Infrastructure Group. In his new role, Sanloup will be helping Welty to grow its position in energy markets such as Renewable Generation, Distributed Energy Resources and Transmission and Distribution. Nicolas comes to Welty from Siemens Industry, Inc. where he served as U.S. Head of Transmission Solutions Business Unit reporting to the Energy Management Division.

Karl Randall is the newest associate at Beacon Financial Partners. Karl has joined an advisory team at the Beachwood wealth management firm that provides 401(k) and Profit Sharing plan management to businesses, as well as financial planning services to clients. Additionally, Karl will be creating digital marketing campaigns on Beacon’s Digital Innovation Team. Prior to joining Beacon, Karl worked with TD Ameritrade and earned his BS in Economics from the University of Michigan.

Ancora is happy to announce that Mr. Connor Mackovjak has joined the firm as a Vice President and Family Wealth Advisor.

Connor will be managing relationships with and advising Ancora’s individual and retirement plan clients. Connor has previously worked as a registered financial representative along with other professional positions. In addition, he currently serves with the Ohio ARMY National Guard as an operations officer and battle captain for the Homeland Response Force.

HEALTH CARE

LAW

REAL ESTATE

CSJ Initiatives, a division of the Congregation of St. Joseph

Benesch

Chicago Title Insurance Company

CLASSIFIEDS OFFICE SPACE Storefront Office Space Tremont Neighborhood 1100 sq.ft. at the historical Tremont Place Lofts, 2372 West 7th. Street, Cleveland, Ohio 44113 Please call for information: 216-274-0866

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BUSINESS SERVICES

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Chicago Title is pleased to announce that Samantha Joseph has joined their commercial team as a Commercial Escrow Officer and Underwriter.

Samantha has nearly 20 years of experience with real estate transactions. She served as in-house counsel in the title and real estate industries and served as Senior Counsel for a large bank. Samantha earned her Bachelor’s Degree from John Carroll University and her Law Degree from Cleveland Marshall College of Law.

NEW GIG?

Preserve your career change for years to come.

Plaques • Crystal Keepsakes Frames • Other Promotional Items Laura Picariello Reprints Sales Manager C R A I N ’ Slpicariello@crain.com CLEVELAND BUSINESS (732) 723-0569 C O N TAC T

The Congregation of the Sisters of St. Joseph, which has a long presence in Cleveland, has named Denise Gannon as Chief Executive Officer of CSJ Initiatives, our senior care and property management division based in Wichita, Kansas. A Cleveland native, Denise joins us with over 20 years experience in clinical and operational healthcare and elder care, including a 20 year career at Eliza Jennings Senior Care Network in Cleveland. She assumes her role on October 29.

Susan M. White has joined Benesch as an associate in the firm’s Litigation and Construction Practice Groups. She represents subcontractors, contractors, suppliers, sureties and project owners in contract negotiation and drafting, negligence, breach of contract, breach of warranty, construction defect, design deficiencies, delay, changed site condition, and lien claims. She also represents clients in all facets of complex commercial litigation disputes in state and federal courts.

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To place your listing in Crain’s Cleveland Classifieds Contact Kate Rozek at 216-771-5276 / email CLBClassified@crain.com Copy Deadline: Wednesdays @ 2:00pm -- All Ads Pre-Paid: Check or Credit Card

BUSINESS FOR SALE BUSINESS FOR SALE Distributor of high quality motion control products Sales $1.8M mike@empirebusinesses.com www.empirebusinesses.com 440-461-2202

SIGN UP FOR ONE OF OUR INDUSTRY NEWSLETTERS www.crainscleveland.com/newsletters Contact Kate Rozek at 216-771-5276 10/24/18 2:32 PM

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SOURCE LUNCH

Darlyn McDermott Market leader and senior growth adviser, Magnet Darlyn McDermott is a self-described “insurance wonk.” But after 20 years in risk management, she joined Magnet, the Manufacturing Advocacy and Growth Network, to serve as the boots-on-the-ground leader in the organization’s recently minted Southern Region that serves about nine counties, including Summit, Stark, Wayne, Medina and Portage. “I like seeing companies grow. I got to know Magnet. … It just seemed like maybe I could help companies in a broader way,” she said. To get closer to the southern manufacturing scene, Magnet opened an office in downtown Akron this summer and this month announced a joint program with the Bounce Innovation Hub. Being close to the manufacturers she hopes to serve is important to McDermott. Just like in the insurance business, Magnet is working with intangibles, she said.

In Magnet’s case, it’s the delivery of consulting services. “To me, I learned that people want to do business, especially when they’re buying intangibles, with people close to their marketplace.” — Sue Walton

The McDermott file Close to her roots She just built a house on the street she grew up on in Jackson Township.

Life in the fast lane She loves riding motorcycles.

News junkie “I get up at 5:30 every day and I burn through three newspapers before 7.”

Guilty pleasure “I love music … Sometimes I just need 30 seconds of Bon Jovi.”

Lunch spot Melt Bar and Grilled 6700 Rockside Road, Independence 216-520-1415

The meal One had Mac & Cheese bites and a Coke; the other had tomato soup and a Diet Coke.

The vibe Bring your appetite to this chain that features kitschy decoration and a menu that has puts one ingredient on a pedestal: cheese.

The bill $22.96 with tip

Why did Magnet split the territory the way it did?

So much at how I looked at our territory I really based it on my own experience. … For us, it was always I-80 was the line of demarcation, even from an underwriting perspective. The pricing strategy was different north of I-80, because of population density and things like that. And then south of I-80, it was a different structure all together. So I just took all that we knew about people’s buying habits and about company habits, and where customer bases are, and I just applied that to my strategy with Magnet.

How are your efforts going in the Southern Region so far?

I think that our efforts are going very well. I think that we are getting traction. I think people are far more aware of us than maybe they’ve ever been. Not because we didn’t have good partnerships, but because we just weren’t repetitively kind of there. And I think the investments we’ve made in branding, a stand-alone office and a commitment to the Akron community have helped. But now I think it’s a matter of showing up and doing what you say and saying what you do. I wish I had 10 people on our team, but we’re small but mighty. …

We also want to be part of the economic development ecosystem and contribute in meetings and contribute on panels. In November, for example, I’m partnering with three other organizations to put on an executive roundtable for cybersecurity. I think that will be a new and different offering that our manufacturers in (the southern

counties) haven’t seen. The Burton D. Morgan Foundation, Team NEO, ConxusNEO, all these organizations have allowed me to come and to participate in their planning meetings.

Is Magnet getting some strong partnerships that it maybe didn’t have before?

We always had them. I just don’t think that we had anyone on our end in Akron who could kind of do all the Akron stuff, because we were committed to doing the Cleveland stuff. And we’ve had a long history with the Greater Akron Chamber, the Canton chamber. We had offices in those chambers for a long time. We still do in Canton. It would make me happy if we could expand our signage presence in the Canton chamber, and it would be nice to have a little more visibility. I know they’d like that, too.

You always have to balance people and budget. And while we want to have more contracts, because that means we’re doing our job, there is still just one of me. But we’re starting to pull other growth advisers down to do it, too. But we’re also trying to build our network.

Talk about the balance between contractually working with manufacturers, vs. helping the workforce, vs. some of the other things you’re doing.

That’s a really insightful question because we are trying to do three things at once. We are trying to expand our footprint, which means we are trying to interface in the economic development system. …

But that comes with a commitment.

It comes with going to the same

meetings and trying to be part of the strategy. So, a third of the time is spent on the strategy. Another third of the time is spent on the processing of the work. There’s always work that comes out of the strategy meetings, and it’s no different than when we meet with a client. The last thing, of course, is the most important thing, and that’s the other third of the time that is spent with actual clients. So meeting with companies and the owners.

As you’ve gotten further entrenched in your role, is there anything that surprised you about region’s manufacturing scene?

I’m still surprised every day. I find these companies, even me and I’m looking for them, that I drive by every day or I never knew what went on in that building. I’ve totally been surprised.

When you talk about the Southern Region, do you have concrete, measurable goals for what you want to accomplish at this point?

I do. I really would like to see at least 15 manufacturers a month, and that’s in all the counties, not just Akron. But I truly believe that Akron, Canton, Medina, Portage County and Wayne County are the core of that. … If we could convert three to five of those to actual contracts where we can deliver services, that would be fantastic.

We’re very mission focused, but we do need to keep the lights on, and it does help that to write contracts. I like the accountability that we have to the client.

CLEVELAND BUSINESS 700 W. St. Clair Ave., Suite 310 Cleveland, OH 44113-1230 Phone: (216) 522-1383 www.crainscleveland.com Twitter: @CrainsCleveland Publisher/editor Elizabeth McIntyre Group publisher Mary Kramer Managing editor Scott Suttell Creative director David Kordalski Web editor Damon Sims Associate editor/Akron Sue Walton Assistant editor Kevin Kleps Senior reporter Stan Bullard, Real estate/construction Reporters Jay Miller, Government Dan Shingler, Energy/steel/auto/Akron Rachel McCafferty, Manufacturing/energy/ education Jeremy Nobile, Finance Lydia Coutré, Health care/nonprofits Senior data editor Chuck Soder Cartoonist Rich Williams Events manager Ashley Ramsey Marketing coordinator Megan Lemke Integrated marketing manager Michelle Sustar Managing editor custom/special projects Amy Ann Stoessel Director of advertising sales Lisa Rudy Advertising sales manager Steve Copley Senior account executive Dawn Donegan Account executive Laura Kulber Mintz Office coordinator Denise Donaldson Pre-press and digital production Craig L. Mackey Media services manager Nicole Spell Billing Peter Iseppi Credit Rod Warmsby Crain’s Cleveland Business is published by Crain Communications Inc.

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THE WEEK He’s a ‘no’

Dealer deal

Orchestra dismissals

Forest City Realty Trust Inc. of Cleveland has a powerful opponent to its deal to be acquired by Brookfield Property Partners: the former CEO of Forest City.

Albert Ratner, Forest City’s co-chairman emeritus and former CEO, on Oct. 25 issued an open letter to Forest City shareholders announcing his intention to vote all of the Forest City shares he controls against the pending acquisition. He objects to the price and timing of the deal, as well as the process that led to it.

A special meeting of Forest City shareholders is scheduled for Nov. 15 to consider the deal in which the company would be acquired by Brookfield for $25.35 per share in an all-cash transaction valued at $11.4 billion, including debt.

Bain Capital Private Equity acquired a majority stake in Dealer Tire, a Cleveland-based tire and automotive parts distributor that has been one of the fastest-growing companies in Northeast Ohio since it became an independent business in 2002.

Bain bought out Lindsay Goldberg, a private equity firm that acquired a stake in Dealer Tire in 2014. Lindsay Goldberg owned a majority stake in Dealer Tire, according to a credit rating action Moody’s Investors Services issued in May. A news release announcing the deal didn’t disclose financial terms but described it as a “significant investment in the company to accelerate growth and expansion.”

The Cleveland Orchestra fired two men — concertmaster William Preucil and principal trombonist Massimo La Rosa — who were accused by female musicians of sexual misconduct.

Their removals, announced Oct. 24, followed what the orchestra characterized as a “thorough, independent investigation” led by a special committee of its board.

Preucil was suspended on July 27 in the wake of a Washington Post story from the previous day that detailed allegations made against him by violinist Zeneba Bowers. Allegations against La Rosa later became part of the orchestra’s investigation.

The orchestra said it also revised and strengthened its anti-harassment policy.

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In 2017, Dealer Tire moved into Victory Center, which is shown in 2015.

Bain Capital Private Equity acquired a majority stake in the tire and automotive parts distributor last week. (Crain’s file photo)

10/26/18 3:35 PM

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