20120402-NEWS--1-NAT-CCI-CL_-- 3/30/2012 9:36 AM Page 1 $2.00/APRIL 2 - 8, 2012 Bank files Expecting foreclosure shortage, on Tower insurers at Erieview Lawsuit includes garage, tout jobs but not adjacent Galleria Demand likely will rise, By STAN BULLARD [email protected] so sales pitches intensify After nearly a decade of trying to By TIMOTHY MAGAW make a go of the 40-story Tower at [email protected] Erieview, an investor group led by co-owner Werner Minshall is in danger JASON David Hazen isn’t surprised young of losing the landmark property in MILLER professionals aren’t flocking to the insur- downtown Cleveland to its lender. PHOTOS ance industry. After all, he said, it isn’t The office building and its 400-car perceived as the most riveting career. underground parking garage are the But there are jobs to be had in the busi- subject of a foreclosure action filed ness — and more likely are on the way. March 23 by U.S. Bank in Cuyahoga SPECIAL REPORT “When you were growing up and your County Common Pleas Court. The uncle asked what you wanted to do for a lawsuit against Mr. Minshall’s Erieview living, you probably said you wanted to Tower & Parking LLC looks to satisfy be a teacher, fireman or a doctor,” said a $44 million mortgage issued by the REMAKING Mr. Hazen, vice president for commercial bank. insurance lines at Huntington Insurance However, the attached, glass- TH in Salem. “The last thing you would have topped Galleria, 1301 E. Ninth St., is WEST 25 AND said is that you wanted to be an insurance exempt from the foreclosure action agent or in the insurance business.” as it was financed separately and Mr. That situation creates a problem, Minshall controls it through a different industry insiders say, as the state’s insur- company. THE MARKET ance work force by 2016 is expected to Mr. Minshall said last Tuesday, grow by 7.1% due to heightened demand, March 27, he was surprised the bank bringing along 16,900 new jobs, according filed to foreclose. The real estate DISTRICT to market research from Kent State Uni- owner based in Bethesda, Md., said versity. Moreover, other studies suggest as he hopes to retain the asset. much as 50% of the insurance industry’s “We’ve been trying to work it out ◆ Driving forces current work force will reach retirement for more than a year. They must age by 2016. have gotten tired of talking to me,” ◆ Financial needs As such, local insurance companies and Mr. Minshall said. “We’re making a brokerage firms are looking to expand lot of progress (with the complex). ◆ Residential growth in-house training programs to lure young It’s not been an easy deal, but there employees, partner with local colleges to are reasons for them to back off and ◆ Full coverage: PAGES 11-18 beef up the talent pool and, perhaps most let me continue it.” He declined to importantly, better sell their industry as a See ERIEVIEW Page 21 www.CrainsCleveland.com/W25th See INSURERS Page 20 Next for Cedar Fair CEO: Take record years to greater heights By TIMOTHY MAGAW of the challenges facing the amusement including Cedar Point in Sandusky. Ouimet’s paramount tasks during his [email protected] park industry, but he said the company’s “Because we are such an extraordi- first full season with the company since largest hurdle is what he’s characterized nary value, we tend to win that battle, becoming Cedar Fair’s president last Matt Ouimet’s biggest challenge these as a “time poverty” issue. but I think about it a lot,” Mr. Ouimet summer. He stepped into the CEO role days is tearing people away from their The former longtime Disney executive said in an interview last week with Jan. 3 after longtime executive Dick jam-packed schedules so he can scare admitted spending a lot of time thinking Crain’s Cleveland Business. “If you’re off Kinzel retired. them to death on a 400-foot-tall roller about how to convince consumers to doing something else besides coming This year, the company is rolling out a coaster. spend their time and hard-earned cash here in July, I call you a ‘why not?’” new marketing campaign, an upgraded OK — maybe the new Cedar Fair LP at Cedar Fair’s 11 amusement parks and Getting those so-called “why nots” online platform to sell tickets and, in CEO wasn’t that dramatic in his assessment six water parks throughout the country, into the parks will be one of Mr. See HEIGHTS Page 19 Ouimet INSIDE 14 7 Stow golf agent R.J. 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Porsche Driving School trip has a retail value of $1,800. 20120402-NEWS--3-NAT-CCI-CL_-- 3/30/2012 3:37 PM Page 1 APRIL 2 - 8, 2012 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 3 Rents to hit record, driven by occupancy Rates expected to climb 3%, but some owners can’t raise prices BEHIND THE RENTAL DATA Multifamily rental rates are back on the upswing, according to data from Marcus & By STAN BULLARD expected to rise 3% to $725 a month investments at Marcus & Millichap’s Millichap Research Services and Reis. The numbers: [email protected] in 2012 from $704 in 2011. Independence office, said he and Monthly asking rents, or adver- his colleagues specializing in apart- Year Asking rent Percentage change Northeast Ohio apartment owners tised rates before concessions such ment sales hear evidence of the rent have entered History City. as a month of free tenancy, are increases from owners on a regular 2012 $756 4.7% A just-updated forecast by the expected to increase 2.6% this year basis. They also see it in financial 2010 722 -2.3 Marcus & Millichap real estate to $756 from $737 last year. The data they gather to list and evaluate brokerage estimates multifamily spread between asking and effective for-sale apartment buildings. 2008 739 5.4 rents in the Cleveland market will hit rents shows that apartment owners “Savvy owners are taking advan- a record this year. Average effective still need to market competitively tage of occupancies and are raising 2006 701 3.1 rents — actual rent payments land- even as regional occupancy sits at rents as leases come up for renewal 2004 680 1.5 lords receive after concessions and 94%. and for new tenants,” Mr. Barron discounts in negotiations — are Michael Barron, a vice president of See RENTS Page 19 2002 670 3.6 (over 2000) INSIGHT Community banks seek investor infusion Aging demographics force institutions to recruit shareholders By MICHELLE PARK [email protected] Visible through the glass walls of president and CEO Ed McKeon’s office is a big banner that tells all those who come inside Western Reserve Bank in Medina, “You can become a shareholder in your bank.” JANET CENTURY The banner was LeanDog CEO Jon Stahl has tried to encourage a culture of creative thinking. “Why do I have to work in a cubicle? Why do I have to wear a tie?,” he asks. hung three months ago and is a 7-foot- By CHUCK SODER companies to use agile techniques McKeon tall sign of the [email protected] — was supposed to top out at 20 lengths to which community banks in Northeast Ohio retty soon LeanDog might employees, Mr. Stahl said. are going to interest their customers “Now we’re at 50 and probably in buying stock in the institutions AGILITY have to change its name where they bank. Their primary to BigDog. headed to 100,” he said, adding that goal is to line up new investors to replace longtime stockholders, some The software company the company has 25 positions open. To accommodate that growth, the of whom want to liquidate their ABILITY Pbest known for working out of a barge holdings. on Lake Erie more than doubled its company is expanding its offices. Both Western Reserve and Cortland Cleveland software developer Mr.