In Search of Research Recognition

20110822-NEWS--1-NAT-CCI-CL_-- 8/19/2011 3:23 PM Page 1

$2.00/AUGUST 22 - 28, 2011

SPECIAL REPORT A DOSE OF REALITY: Is all this health care building good for us? PAGES 13-19 Market’s IN SEARCH OF volatility RESEARCH leads to RECOGNITION Kent State’s new hire has tough task: buybacks Boost coffers amid budgetary upheaval

Firms see their shares By TIMOTHY MAGAW as value investments [email protected] s the point man for filling marching By MICHELLE PARK orders by Kent State University [email protected] president Lester Lefton to build in a big way the school’s stash of research A number of public companies in dollars,A Grant McGimpsey knows he faces an Northeast Ohio aren’t sitting on the uphill battle — but one he intends to take on sidelines as insiders and investors at full speed. pocket their shares at reduced prices Though he has been on the job as Kent in a yo-yo stock market. They, too, State’s vice president for research for just a are buying or are poised to do so. few weeks, Dr. McGimpsey already is knee- The boards of both Cliffs Natural deep in discussions about how to inject Resources Inc. and Invacare Corp. more research money into the university’s just last week authorized new stock coffers, an amount often perceived as a metric repurchase plans that allow both that gauges a school’s prestige. companies to buy back millions “Kent State needs to be recognized as a more of their own shares. research university, and that’s why I’m here,” The Cliffs board last Monday, Aug. Dr. McGimpsey said. “I want to work at an 15, authorized a new repurchase institution that recognizes the value of what plan allowing the iron ore producer MARC GOLUB research can do for a society, and I’m not to buy up to 4 million shares of its Dr. Grant McGimpsey, Kent State University’s new vice president for research, being corny here.” common stock outstanding. stands next to a confocal microscope in the biology department at KSU. See RESEARCH Page 11 Citing “recent volatility in the global equity markets,” Cliffs chief financial officer Laurie Brlas said last week’s buyback authorization “will allow Cliffs to opportunistically acquire shares at attractive valuations.” New convention home luring industrial groups back And Invacare, based in Elyria, announced last Friday, Aug. 19, that By DAN SHINGLER Even two years before the city’s new ventions here, Positively Cleveland so far has been encouraged to see its board had authorized the company [email protected] convention center is finished, big leaders say. Their audience — those not just medical device companies to repurchase more common stock, industrial organizations already are in rubber, plastic and steel-related drawn to the city as it prepares to boosting its overall authorization to Cleveland is the place to be — at signing up to use it. And when they manufacturing businesses — never build and unveil the Cleveland 2.5 million shares. least if you are holding a big indus- do, some shows will bring thousands left town. Medical Mart and Convention Center Asked why Invacare executives trial trade show. of people to town, Positively Cleve- “The shows are returning because in late 2013, but basic industrial sought a new authorization, Gerald That’s the word from Positively land says. this is their market. Their wheel- groups as well. B. Blouch, president and CEO, cited Cleveland, the group that markets It wasn’t that the industrial groups house is right here,” said Eric Julian, For some, it will be déjà vu all widespread uncertainty over equities Cleveland as a tourism and conven- ever had a beef with this shrunken national sales manager for Positively over again, as many of those groups and the general economy, as well as tion destination, along with those old manufacturing giant; there just Cleveland. used to hold their meetings here See BUYBACKS Page 21 who hold the shows themselves. weren’t good places to hold con- Mr. Julian said his organization See SHOWS Page 21

INSIDE 34 6 Growth in road racing, Corporate Challenge give sports management outfit

74470 01032 by Crain Communications Inc. PLUS: ALUMNI STEP UP GIVING ■ Vol. 32, No. 34

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2 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM AUGUST 22 - 28, 2011

CORRECTION COMING THE RIGHT DIRECTION An Aug. 1, Page One story on the NEXT WEEK In the second quarter of 2011, private-sector U.S. employers initiated 1,624 possible sale of land at Lakewood “mass layoff events” that resulted in the separation of workers from their jobs Country Club to American Greet- for at least 31 days, down 19% from 2,008 mass layoffs in the 2010 second ings incorrectly indicated that land in Philanthropic duties quarter. The federal government says the number of extended mass layoffs 700 W. St. Clair Ave., Suite 310, South Euclid at Oakwood Country declined in 16 of the 18 major private nonfarm industry sectors over the year Cleveland, OH 44113-1230 Club already is undergoing redevelop- We explore in our philan- that ended in the second quarter of 2011. Such layoffs now are at less than Phone: (216) 522-1383 ment as a big-box shopping center. half their recession peak, which ran from late 2008 through the first two quar- Fax: (216) 694-4264 thropy, fundraising and non- www.crainscleveland.com The redevelopment of that land only is ters of 2009. Here are data for the past three years: proposed at this stage. profit section Publisher/editorial director: a partnership QuarterNumber of Quarter Number of Brian D. Tucker ([email protected]) between the mass layoffs mass layoffs Editor: REGULAR FEATURES Mark Dodosh ([email protected]) Cleveland April-June 2011 1,624 Oct.-Dec. 2009 2,416 Managing editor: Classified ...... 22 Sight Center Jan.-March 2011 1,490 July-Sept. 2009 2,034 Scott Suttell ([email protected]) Sections editor: Editorial ...... 8 and InfoCision aimed at Oct.-Dec. 2010 1,999 April-June 2009 3,395 Amy Ann Stoessel ([email protected]) Assistant editors: Going Places ...... 12 training blind and visually July-Sept. 2010 1,370 Jan.-March 2009 3,979 Letter...... 9 impaired individuals to work Joel Hammond ([email protected]) April-June 2010 2,008 Oct.-Dec. 2008 3,582 Sports List: Largest nursing for InfoCision’s call center Kathy Carr ([email protected]) homes ...... 20 operations. Plus, we look at Jan.-March 2010 1,870 July-Sept. 2008 1,581 Marketing and food Senior reporter: Personal View ...... 8 workplace fundraising. SOURCE: U.S. BUREAU OF LABOR STATISTICS Stan Bullard ([email protected]) Real estate and construction Reporters: Jay Miller ([email protected]) Government Chuck Soder ([email protected]) Technology Dan Shingler ([email protected]) to understand Manufacturing Tim Magaw ([email protected]) your mission, Health care & education Michelle Park ([email protected]) Finance we must Research editor: Deborah W. Hillyer ([email protected]) understand Cartoonist/illustrator: Rich Williams Marketing/Events manager: your passion Christian Hendricks ([email protected]) Marketing/Events Coordinator: Jessica Snyder ([email protected])

Advertising sales director: Unlock a different approach to business banking. At KeyBank, Mike Malley ([email protected]) Account executives: we ask questions. We listen. We get to know you and your Adam Mandell ([email protected]) business. Then, we make everything work together, from Dirk Kruger ([email protected]) Nicole Mastrangelo ([email protected]) managing cash and ﬁnancing your future to safeguarding Dawn Donegan ([email protected])

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AUGUST 22 - 28, 2011 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 3 East Side manufacturers on the move

hopes to move into his new building machines he already installed and of a six-person Mentor grinding Work orders hum along, prompt expansion on Tyler Boulevard by spring 2012, has up and running in the new company, CR Grinding, that Fredon but how soon his company com- plant. bought last month and now oper- plans for Lake County’s Fredon and Astro pletes the move depends to some Mr. Sustar said his company, ates as Fredon Grinding Division. extent on how quickly he can sell which is a contract specialty The company’s new building, By DAN SHINGLER prepares to move into new digs his existing operation down the machine shop, has been busy, formerly home to a printing company [email protected] while Eastlake’s Astro Manufacturing street on Enterprise Drive. He’s especially with orders from defense and a sports equipment retailer, and Design mulls a purchase of already moving ahead, though. contractors and medical device encompassed 32,000 square feet Two of Lake County’s home- Fredon’s existing factory space for “To do the work we’re getting — makers. He has gone from 70 when Mr. Sustar bought it for grown manufacturers are on the its own expansion. we don’t have enough room,” Mr. employees a year ago to 85 today. $900,000 at a sheriff’s auction at the move, as Fredon Corp. of Mentor Fredon CEO Roger Sustar said he Sustar said, walking amid a few Those workers include members See EXPAND Page 21

INSIGHT HERMES Some colleges’ RACES TO alumni outreach THE TOP begins to pay off Schools remain wary, however, as markets continue to stumble

By TIMOTHY MAGAW [email protected]

Alumni giving appears to be reviving from its recessionary doldrums at a number of Northeast Ohio colleges and universities, though squirrely financial markets could impact donations going forward. While multimillion-dollar mega-gifts always are welcome, development officials say the strength of their fundraising operations can be measured by the success of their annual drives targeting alumni, who are counted on for a consistent stream of money that typically comes without strings attached. “It represents your rank and file,” said William Spiker, Baldwin-Wallace’s vice president for advancement. “It penetrates so many sectors of a college. I think the annual fund is a good barometer of whether your alumni are sticking with you.” PHOTOS PROVIDED Officials at local universities hope the turbulent TOP: Participants compete in the 2011 Cleveland Corporate Challenge’s final day, which included a tug-of-war, 10K relay and other events. economic waters that threw their fundraising efforts Hermes Cos., which runs the summer-long challenge, said participation continues to rise. ABOVE: Runners start the Cleveland 10-miler, held for a loop in 2008 and 2009 have calmed. And in May at Edgewater Park. It is one of the many races managed by Hermes. although recent turmoil in the financial markets has many concerned, they’re somewhat optimistic about the road ahead considering the increase in giving over the last year. Road race, Corporate Challenge participation rises “Once people are back to the habit of giving, they’re likely to continue giving,” said Rae Gold- smith, vice president for advancement services at the as event manager plans to take its operation to the next level Council for Advancement and Support of Education, a Washington, D.C.-based professional organization By JOEL HAMMOND Cos. likely has a way for you to do it. representing fundraising professionals in education. [email protected] The event management business continues “What we saw was that a lot of donors just paused to grow in each of its three facets: road racing, because the future was so uncertain,” Ms. Goldsmith ellness efforts have become in- sport and social events, and Cleveland Cor- said. “There’s greater confidence now. People always creasingly prevalent in Northeast porate Challenge, a summer-long athletic planned to give, but they just took a deep breath.” Ohio and elsewhere, as employers competition pitting area companies against Baldwin-Wallace saw a 3% increase both in the preach healthier habits to cut each other in 14 events. The latter ended number of donors and the amount of money that downW on health care costs and people gener- earlier this month. came in through its annual fund drive that ended ally are becoming more aware of their health. On the road racing side, Hermes wholly See ALUMNI Page 6 If you’re looking to join the craze, Hermes See HERMES Page 10 THE WEEK IN QUOTES “There are always a lot (of “We try to do what every- “I think what’s ... valuable “Everybody is attached to universities) who raise their body else does — buy on about health care systems their community hospital. hands in the air and say downticks. There’s a good is that unlike a lot of in- … This is not like closing they have a billion dollars probability that we may dustry in this town, they’re a paint factory. … These in research funding. But use our remaining autho- constantly looking at their are emotionally charged the question is ... how well rization.” infrastructure and what issues.” were those dollars used?” — Mark O. Eisele, vice president, chief they need to do to upgrade — Cleveland Clinic CEO Toby Cosgrove. financial officer and treasurer, Applied Page 13 — Grant McGimpsey, Kent State University’s Industrial Technologies Inc. Page One in order to be competitive.” new vice president for research. Page One — Bill Ryan, president of the Center for Health Affairs. Page 13 20110822-NEWS--4-NAT-CCI-CL_-- 8/19/2011 2:13 PM Page 1

4 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM AUGUST 22 - 28, 2011 Optimism lags despite report on positive economic output

2000s and never really recovered to ment rate of 8.9% for the same period. Team NEO’s latest 1990s levels. So, if today there is a That’s also an improvement from modest rebound from three or four a year ago, when unemployment in data on employment, years ago, no one is impressed. Northeast Ohio stood at 10.1%. “It probably didn’t feel that great The gains in employment came GRP show growth in 2007,” Ms. Bradley said. “(People) in three of the four market sectors remember a time when there were Team NEO tracks. Construction By JAY MILLER more jobs, more growth.” employment was up 17% over the [email protected] Tom Waltermire, Team NEO’s first quarter of the year. That CEO, doesn’t disagree with that increase reflects what at least can be The latest quarterly economic assessment. described as a boomlet in commer- report from Team NEO suggests “There is no question people are cial and public building, with Northeast Ohio’s economy is still suffering,” he said in an inter- projects such as the Eaton Corp. improving. Employers are doing view earlier this month during headquarters in Beachwood, the more hiring and the region’s which he talked about his organiza- convention center and medical economic output, or gross regional tion’s review of regional economic mart in downtown Cleveland and product, is tracking upward. indicators for the second quarter of the $650 million V&M Star steel mill So, why aren’t people in 2011. “People do not feel expansion in Youngstown. the region more optimistic like that chart.” Manufacturing employment also : about its economic future? Team NEO is a regional was up in the second quarter by The answer, or rather organization that markets 2.1%, while service sector employ- answers, from economists Northeast Ohio to expanding ment gained 2.3%. Government and economic develop- businesses. Its economic employment was flat. ment officials focus on the review covers 16 counties Team NEO also tracks how the psychological impact of from Mansfield in the current recovery is faring against the long-term struggles of south and Lorain in the the 1981 recession that Team NEO the regional economy and Waltermire west to Ashtabula and considers most comparable to the the difficulty of seeing the bright Youngstown in the east. current downtown. It graphs how spots emerging in a sea of gloom. The chart Mr. Waltermire well the regional economy fared “What you have in (Northeast referred to is in Team NEO’s against the rest of the country in Ohio) and a lot of the metropolitan second-quarter economic review, both recessions. That chart shows areas of the Great Lakes is a layering and it tracked ups and downs of that Northeast Ohio is recovering as of recessions,” said Jennifer Bradley, Northeast Ohio’s gross regional well this time around as the national co-director of the Great Lakes Eco- product since 1994. That chart economy. projects that the region’s economy nomic Initiative at the Brookings Self-esteem issues Institution, a think tank based in in 2011 will grow 2.5% over the Washington, D.C. “The recovery in level of 2010, which was up 1.9% That’s a sign of a significantly this recession comes on top of a long over 2009. stronger regional economy than existed in Northeast Ohio at the period of job declines in Cleveland, Working data Ohio, Michigan and the (Great time of the early 1980s recession, Lakes) region.” It’s that growth in the market when the recovery in employment Ms. Bradley said people remember value of goods and services pro- levels in Northeast Ohio lagged 7% better times in the 1980s and 1990s duced in the region that makes Mr. beyond the nation. before hard times hit in the early Waltermire optimistic about North- “We’ve been performing at a east Ohio’s economic health. lower rate (in Northeast Ohio) Team NEO uses this economic than the whole of the United States data when it promotes the region for 20 years,” said Ziona Austrian, CUT YOUR COMPANY’S to site selectors, who favor growing director of the Center for Economic ENERGY SPENDING regions when they make site recom- Development at Cleveland State mendations to their clients. Their University. “It’s very early, but if we clients are businesses looking to continue at the same average relocate or expand into a new growth rate as the U.S., it would be tipstips region. great.” 6 Gross regional product, or GRP, is Mr. Waltermire said one reason considered a valuable measure of for the lack of confidence in the TO CHOOSING A NATURAL GAS PROVIDER the size of an economy, and the size recovery of the Northeast Ohio As a partner dedicated to developing customized solutions for non-residential energy users, Delta Energy has creat- of its growth over time is a sign that economy is that many people still ed a series of six tips designed to help you choose the natural gas program that’s best for you and your business. an area is a vibrant, attractive region gauge the region’s vitality by the for new businesses. strength of what had been its indus- by Phil Norcom Team NEO also charts employ- trial giants — the steel and automo- ment, and for the second quarter of bile industries, in particular. Those 2011, its report shows a 2% increase industries have been declining for Weigh the pros and cons of fixed and variable options. in employment with 1.95 million years and are not likely to make a people employed, an increase of full recovery. One size does not fit all. Your natural gas supplier should take the time to understand (or even help you define) 41,000 this quarter over the first But he said other new job-creating your objectives for the contract term. You2 should not choose a fixed price in an attempt to “beat the market”. quarter of 2011. businesses, in manufacturing and Because some of that growth is in other industries that don’t have The true benefit of a fixed-price contract is price certainty. Although the market might dip below your fixed typical seasonal growth in employ- the dramatic presence of steel and price at some point during your contract, you’ll never be surprised when you open your gas bill because the ment, Team NEO also measures automakers, are beginning to assert only factor that impacts the total due is how much you use. Be leery of a supplier that pushes a specific the increase from year to year. themselves. That growth, he said, is pricing option. An energy partner like Delta Energy will offer several options and recommend the product that Those data show the 41,000 increase not being noticed. best helps you meet the goals of your business. in jobs is higher than the increase “We have had a massive shift in from the first quarter of 2010 to what we’re making here, and peo- Phil Norcom has been developing and maintaining customized energy strategies with successful business people like you for 7 years. the second quarter of 2010, when ple don’t think of that because they As one of Delta’s dedicated account managers, Phil uses a personal, proactive approach to deliver peace of mind to Cleveland area 25,000 jobs were added. see the legitimate stories about the businesses. Contact him for a custom quote and let him put the "Delta Promise" to work for you. With employment up, measured declines” in the legacy industries, unemployment was down, according Mr. Waltermire said. “That’s what to Team NEO. The unemployment stands out to people, and that’s rate in its Northeast Ohio region for what they remember because the second quarter of 2011 was declines happen cataclysmically 8.5%, below the national unemploy- and increases occur gradually.” ■

2007 - 2010

The Delta Promise. Volume 32, Number 34 Crain’s Cleveland Business (ISSN 0197-2375) is published weekly, except for combined issues on the fourth week of May and fifth week of May, the fourth week of June and first week of July, Customization. Proactive Performance. Collaboration the third week of December and fourth week of December at 700 West St. Clair Ave., Suite 310, Cleveland, OH 44113-1230. Copyright © 2011 by Crain Communications Inc. Periodicals postage paid at Cleveland, Ohio, “Our Business is Putting Energy Into Your Business” and at additional mailing offices. Price per copy: $2.00. POSTMASTER: Send address changes to Crain’s Cleveland Business, Circulation Department, 1155 Gratiot Avenue, Detroit, Michigan 48207-2912. 1-877- 330-257-1139 | www.deltaenergyllc.com/crains 824-9373. REPRINT INFORMATION: 800-290-5460 Ext. 136 20110822-NEWS--5-NAT-CCI-CL_-- 8/19/2011 2:14 PM Page 1

AUGUST 22 - 28, 2011 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 5 Merger allows financial advisers to offer broader services

The merger will create a combined of Hartland, who will retain his title 150 family and individual clients, serve them, Mr. Fulton said. Deal gives combined firm of nearly 50 professionals, 300 after the merger. provides investment management Added Mr. Walter: “There are institutional and private clients and In the long term, the move will and tax, estate and financial plan- professionals all over the place that firm $11B in assets, more than $11 billion in assets mean the combined firm provides ning. It was founded in 1986. do different parts of the pie. Very under advisement. broader services for its clients. The Both firms are fee-only, meaning few have expertise, experience, in staff of about 50 The deal combines the institu- firm also should experience enhanced their advisers don’t earn money by all parts of the pie. That’s some- tional investment capabilities of revenue growth because it’s offering recommending and/or selling thing that’s very, very attractive to By MICHELLE PARK Hartland — which for decades has both types of services and has an specific products. high-net-worth families.” [email protected] served clients such as hospitals, expanded group of clients, or This was the third time the firms Mr. Fulton said he believes the nonprofits and retirement funds — “touch points,” Mr. Fulton said. talked about a combination, said F. firms’ merger is reflective of an Two Northeast Ohio financial with the tax, estate and financial “Together, we’re going to be able Carl Walter, who is chairman of emerging trend of companies that advisory firms have agreed to merge planning expertise of Chess, a to accelerate our growth faster than Chess and will become vice chair- want to provide both investment in what one executive calls the perfect wealth advisory firm serving families either firm has grown in the past,” man of the combined company. advisory services and comprehen- matchup. and entrepreneurs. he said. The timing was right this time, in sive wealth advice. Chess Financial Corp. in Beachwood “It’s really a perfect matchup Hartland, which was founded in part, because Hartland drove efforts The firms’ respective offices will will become a subsidiary of Hartland because we provide the investment 1989, has roughly $10 billion of about 18 months ago to serve more be maintained, though in time, the & Co. in Cleveland via the merger, side, and they provide the wealth institutional and private client private clients and found there aim is to combine the offices. Chess which is expected to close Oct. 1. advisory side,” said Dave Fulton Jr., assets under advisement, Mr. Fulton would be benefits to building its tax Financial Corp. will retain its name, Terms of the deal were not disclosed. president and chief operating officer said. Chess, which serves more than and estate capabilities to better Mr. Fulton said. ■

Employers anticipate rise in health care costs By RICH DALY Modern Healthcare

Many of the nation’s largest employers expect their health care costs to rise by an average of 7.2% next year, despite their increasing use of a variety of cost-control measures, according to a survey by the National Business Group on Health. Next year’s expected increase is slightly less than the mean rise of 7.4% in health care costs that those companies reported for this year, although the expected increase in 2012 would be greater in absolute dollars, according to Helen Darling, president and CEO of the National Business Group on Health. The annual survey by the group, a nonprofit alliance of 83 of nation’s largest companies that together employ more than 4 million workers, found they expect health care costs to continue rising significantly faster than inflation because of medical inflation and provisions of the new Patient Protection and Affordable Care Act. “This is an unsustainable model for our country,” Ms. Darling said at news conference last Thursday, Aug. 18, about the financial strain of the ongoing increases. The rising health care costs found in the annual summer survey stemmed from components of the 2010 federal health care law; those components include its mandate to cover the offspring of workers up to age 26 and its coming bans on caps for annual benefit limits. Employers reported a variety of cost-saving moves to counter the rising cost of their health coverage, including encouraging employees to use centers of excellence for trans- plants and other procedures. “Even if they spend more on the initial admission, they spend less overall due to less need for readmis- sion or re-treatments,” Ms. Darling said about incentivizing employees to seek treatment at highly rated hospitals. ■

Rich Daly is a reporter with Modern Healthcare, a sister publication of Crain’s Cleveland Business. 20110822-NEWS--6-NAT-CCI-CL_-- 8/19/2011 3:26 PM Page 1

6 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM AUGUST 22 - 28, 2011 Garfield Hts. data center expanding

What do you look for By CHUCK SODER over the next several months, Mr. local companies have been strained in a law firm? [email protected] Smith said. for resources, which makes them Though the older data center more open to letting other companies Supplying uninterrupted com- hasn’t grown physically, it has manage their computer systems. puting power has led to uninter- gained customers over the years, “Internal IT departments are being rupted growth for the Garfield too, Mr. Smith said. To accommo- asked to do more and more without Heights data centers owned by date them, Expedient earlier this additional personnel,” he said. Expedient Communications Inc. month turned on $2 million of new Expedient plans to start expanding The Pittsburgh-based company power generation equipment. its newer data center later this year, plans to spend about $5 million to The Garfield Heights data centers Mr. Smith said. The new space — double the amount of data processing have grown significantly faster than now a 7,000-square-foot, indoor space at the newer of its two data Expedient’s other facilities in Pitts- dirt floor — should be a function- centers on NEO Parkway, said Bryan burgh, Boston, Columbus, Indianapo- ing part of the data center by the end Smith, regional vice president for lis and Baltimore, Mr. Smith said, of the first quarter of 2012, he noted. Expedient. The newer center, which declining to give revenue figures. The expansion would bring the opened in 2008, is located next to “Cleveland is actually leading the size of the building to about 21,000 the older one, which opened in 2006. way,” he said. square feet, 14,000 of which would In the process, Expedient likely The reason, Mr. Smith said, might be data center space. The new will add about a dozen employees be because there are fewer com- center then would be the same size to its staff of 40 in Garfield Heights petitors in the region, or because as the older data center. ■ Alumni: Colleges enlist creative efforts

Strong leadership. continued from PAGE 3 said Bill Barlow, Oberlin’s vice pres- all kind of done by one person,” said June 30 compared to levels of fiscal ident of development and alumni David Armstrong, who recently took 2010. Those increases were “not a small affairs. “It’s a lot of things we’ve over as the college’s vice president accomplishment,” Mr. Spiker said, done that have helped us in the last of development and general counsel. given the still-sluggish economy. two years.” “We’re now making a clear invest- “I don’t think we’re out of the For example, Oberlin College hired ment to bring people in because we Competing in today’s business climate can feel like you’re in the jungle. woods yet,” he said. “People are still more staff, invested in new technology need to strengthen this department To survive, you need experienced advisors with the necessary legal skills and guarded about what’s going to happen and recruited more alumni to make and seek higher goals.” leadership to help guide you through even the toughest business challenges. pitches to their classmates. next. It continues to be something we Fingers crossed For nearly 80 years, Walter Haverfield attorneys have taken pride in providing work at day in and day out, but we’re Kent State University is taking a creative solutions that allow our clients to minimize risk while maximizing just grateful for the support we receive.” longer-term approach toward culti- Despite lingering uncertainty their business opportunities. vating more alumni donors, according about the economy, University of Rally the troops to Gene Finn, the university’s vice Akron officials anticipate overall If this doesn’t sound like your current law firm, perhaps it’s time to start So far, Oberlin College’s alumni president for advancement. Shortly fundraising is going to continue looking for a new one. fundraising efforts appear to be after Mr. Finn joined the university to increase. For the fiscal year that working. The college’s alumni in 2007, Kent State launched a ended June 30, the University of participation rate — now at 42% — fundraising campaign, dubbed the Akron raised $46.7 million — a new Cleveland | 216.781.1212 | www.walterhav.com has increased by five percentage Campaign for Change, geared toward record for the school. points over the last two years. This asking current students to donate. Alumni collections had dropped year, the college brought in about $6 “You have to start to instill that markedly for the university, from million through its annual fund drive. sense of philanthropy when the stu- $6.5 million in 2008 to $3.8 million “It’s not one thing we’ve done,” dents get here, which is something in 2009. However, that figure has Kent State hadn’t done before,” Mr. risen over the last two years and hit Finn. “It could take years.” $4.9 million for the last fiscal year. Kent State, which achieved an “Obviously, we believe that there all-time fundraising high of $42.1 is a very strong and bright future million in the fiscal year that ended ahead,” said Tim DuFore, the June 30, saw a decline in alumni giv- University of Akron’s associate vice ing around 2008. Although alumni president of development and chief participation has started to trend development officer. “That’s what upward, Mr. Finn noted, it hasn’t we’re looking toward.” returned to pre-recession levels. If the stock market continues to The size of the gifts coming into plummet, fundraisers are worried the university’s coffers, however, that donors, particularly alumni, has grown considerably. The average once again might hold tightly onto alumni gift in 2007 was about $750, their cash. while in 2011 that average climbed “If you talked to me a month ago, to $1,250. I might have a different answer (about whether the worst was over), Notre Dame adjusts but the last couple weeks have been The revival of alumni giving isn’t a roller coaster,” Kent State’s Mr. universal, however. Finn said. “It’s our responsibility The annual fund at Notre Dame in our operation at Kent State to College in South Euclid hasn’t been communicate with the alumni and the same cash cow as that of other stress things happening here and schools. For the fiscal year that ended stress our kids still need support.” June 30, the college saw a 7% Cleveland State’s alumni giving decline in its annual giving program, was anchored by two wealthy alums which brought in about $230,000, over the last two fiscal years, with a according to Al DiFranco, the $10 million pledge from industrialist school’s director of development. Monte Ahuja in 2011 and a $6 Because Notre Dame’s alumni million gift in 2010 from Bill Julka, base hovers at only about 5,200, the founder of Smart Solutions Inc. in college is moving toward other forms Beachwood. of fundraising, such as events, to But given the uncertainty of the reach out to a broader constituency. last few years — and particularly the As such, the college saw a 30% total last few weeks — what could hap- boost in unrestricted giving — a pen with future alumni giving is number that includes the totals anyone’s guess, according to Rob from the annual giving program. Spademan, Cleveland State’s assis- Also, the college plans to hire a tant vice president university mar- handful of people to ramp up its keting and admissions. development efforts, especially “Some of the larger donors that considering the explosive growth in we’re talking to and working with enrollment the college has seen still seem to be on track ... but it’s hard over the last decade. for us to honestly know what’s go- “These positions in the past were ing to happen,” he said. ■ 20110822-NEWS--7-NAT-CCI-CL_-- 8/18/2011 9:30 AM Page 1

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8 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM AUGUST 22 - 28, 2011

PUBLISHER/EDITORIAL DIRECTOR: Brian D.Tucker ([email protected]) EDITOR: Mark Dodosh ([email protected]) MANAGING EDITOR: Scott Suttell ([email protected]) OPINION Big dose n this week’s issue, we call your attention to an industry that has grown like no other in North- east Ohio over the last quarter century. It is the I health care industry, and it has been hailed as a savior of our local economy because of the tens of thousands of jobs it supports both directly and indi- rectly. But is it a sector that, like the auto industry, eventually may grow too big for its own good? We don’t answer that question in our special report, “A Dose of Reality,” that begins on page 13. However, we do address the subject of the massive FROM THE PUBLISHER amount of investment in hospitals and health centers undertaken during the last decade by our local health care providers as they look to meet the Circus surrounding SB 5 continues medical needs of area residents where they live. Anyone who regularly travels the interstate high- hy, oh why, do we never Board hold hearings for all charges of petition process that there were aspects ways that run through the Cleveland and Akron seem to learn in Ohio? unfair labor practices (and gives that of SB 5 that a majority of Ohioans wanted areas would be hard-pressed to miss the significant Just a scant few months same board the authority to remove to see enacted, and the Republicans suburban medical campuses that have been estab- W after the Republicans used employee classification groups from a seem poised to try to attack these by lished in recent years by the Cleveland Clinic, their resurgent power in Columbus to bargaining unit). individual legislation if they were to lose declare war on public employee unions, Of course, such a broadside enraged on the November ballot. Summa Health System and University Hospitals. those representing labor now refuse any — and engaged — the unions, which are For example, most people I talk to However, these health care providers and others discussion of a deal to find a middle the most powerful in Columbus. They hate the fact that union regulations tie also have built an array of smaller medical centers ground good for all Ohioans. organized a repeal petition effort, the hands of school administrators when that have popped up in small, outlying communi- “These politicians who BRIAN titled “We Are Ohio,” and went it comes to underperforming teachers. ties such as LaGrange and Chesterland, even as passed Senate Bill 5 have the TUCKER about gathering nearly four Cleveland Mayor Frank Jackson knows they’ve continued to invest heavily in new bricks ability to come back and repeal times (915,000) the amount of that the traditional “last hired, first fired” and mortar on their main campuses. the law,” said Melissa Fazekas, valid petition signatures needed. union protection of teachers threatens Some of these investments are big, such as the spokeswoman for We Are Ohio, So, SB 5 never took effect in the promising, high-performing schools which is poised to campaign July, and awaits the state’s voters in his district that are staffed by the $298 million spent for the Ahuja Medical Center in against the bill. “And that is in the form of Issue 2. Gov. Kasich youngest and most innovative teachers. Beachwood that University Hospitals opened last what they should do — repeal and other key Republicans There is no more perfect example of February. Others, such as a $1 million stroke center the entire law. know they face an expensive how rotten politics has become. Conser- at Mercy Regional Medical Center in Lorain, barely “Or they can join us and vote fight and also that polls showed vative Republicans sweep into power register a blip on the construction radar. ‘no’ in November on Issue 2.” that most Ohioans didn’t much and try to decimate public unions. Labor- Viewed in total, though, the financial commitment For those without a scorecard, SB 5 approve of SB 5 in its broadest attack on backed Democrats scramble to overturn of these health care providers is enormous. was the sweeping legislation that tore public unions. the legislation, ignoring any evidence The scope of their expenditures since 2000 can be into the power of public employee unions. Thus the strident refusal of the anti-SB 5 that voters want some of the changes. Among other things, SB 5 prohibits folks to come to the table now and reach Both sides continue to work their seen in a spread on pages 18 and 19. In the aggre- “public employees” from striking, bans any sort of compromise. They’re pleased bases and ignore the powerful moderate gate, they account for nearly $3 billion in construc- payroll deductions for political action with their success and feel they’re in the bloc of voters, wasting energy, time and tion spending. That’s a ton of investment in a market committees and removes a requirement driver’s seat. That’s easy to understand. money. They fiddle while Rome burns, where the population is stagnant. It’s also a level of that the State Employment Relations However, polls also showed during the enthralled by their own music. ■ spending that wouldn’t have been possible two decades ago, when the state still required hospitals to file certificate-of-need applications to gain PERSONAL VIEW approval for the expansion of their operations. The idea behind the certificate of need was to safeguard the marketplace from an excess of U.S. ushers in effective immigration policy duplicative services. It isn’t a coincidence that the building boom kicked in shortly after hospitals were By MARGARET W. WONG Ms. Wong heads an immigration law firm in viously they would have been required to unfettered in the mid-1990s from certificate-of- Cleveland that bears her name. apply for an E-2 visa or to seek EB-5 per- need rules. n light of the recent debt woes facing manent residence, which requires an The competition that has ensued among hospitals our country, it is refreshing to see immigration law. It should be viewed as investment. This will allow more immi- to establish beachheads in prime suburban loca- that U.S. Citizenship and Immigra- a welcome development by all Ameri- grants to create jobs here. tion Services (USCIS) is taking action cans, because it will promote employ- EB-2 National Interest Waivers are tions has created an abundance of choices for Ito help make it simpler for prospective ment and increase investment. granted to foreign workers seeking consumers. But we wonder whether some of the immigrants to apply to invest and build The new initiative by USCIS will cover employment in an area of intrinsic merit to shiny new investments of today will be the under- businesses in our great country. H-1B temporary work visas, EB-2 National our national interest. These waivers are used capacity of tomorrow. Immigration policy can have a pro- Interest Waivers and EB-5 investor green vitally important to our country’s progress Back in 1995, when the certificate-of-need law found effect on our nation’s economy card petitions. H-1B visas are for foreign in the arts, sciences and business. US- was changing, the then-president of Southwest and job growth. It is essential that we employees in “specialty occupations.” CIS’s plan aims to make the application General Health Center, L. Jon Schurmeier, told attract the best and the brightest from According to the new clarifications, for- process smoother and more efficient. Crain’s, “I’m afraid there will be a spending spree, abroad. eign entrepreneurs will qualify to receive Enhancements to the EB-5 Immigrant The announcement by USCIS director H-1B visas. This generally was not possi- Investor green card program will allow fortunate or unfortunate, where he who has the Alejandro Mayorkas of a series of initia- ble previously, because entrepreneurs those who are able to invest $500,000 to most money will win.” We hope the losers in the tives to make it more efficient for USCIS did not have the requisite employer- $1 million and create at least 10 jobs in end won’t be patients, who eventually foot the bill to adjudicate certain business-related employee relationship. the United States to take advantage of for much of this empire building. immigrant petitions is a welcome devel- The new clarification allows entrepre- accelerated processing of their applications opment for those of us in the field of neurs to apply for H-1B visas, where pre- See VIEW Page 9 20110822-NEWS--9-NAT-CCI-CL_-- 8/18/2011 4:22 PM Page 1

AUGUST 22 - 28, 2011 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 9

THE BIG ISSUE DOES OUR WORK Warren Buffett says the rich, including himself, should be taxed more heavily. Is it time to change that part of our tax laws? MEAN MORE OPPORTUNITY FOR YOUR BUSINESS?

MAUREEN SMITH JASON RUSSELL MARGO PARR RICHARD FRANCE FORMERLY Solon Bratenahl Shaker Heights Broadview Heights KNOWN AS THE SMALL I don’t look at it as a soak- It’s a wonderful idea. We We’re in a time where the Warren Buffett is a very BUSINESS the-rich idea. In fairness, have a global problem now government needs to look intelligent man. I think we ENTERPRISE we need to close tax with too much money at for new revenue sources. as a country should pay PROGRAM loopholes. We need a the top. We need to create ... I personally like the attention to what he says. balanced approach, of not a stronger middle class idea. I don’t think the just cuts, but to raise addi- right now. That can be deficit should be balanced tional revenue. done by taxing the on the backs of the middle wealthy. class and the poor.

➤➤ Watch more people weigh in by visiting the Multimedia section at www.CrainsCleveland.com. Charter school operator misrepresented

■ As I have previously pointed out who never would have had either If your company is a small construction or engineering ﬁrm or to Crain’s publisher Brian Tucker, LETTER but for our schools. a provider of goods and services, we invite you to apply for our he needs to check his facts before According to the University of Business Opportunity Program. he writes commentaries like that of The litigation in question is a dis- Cincinnati, our schools benefit the Aug. 15 criticizing White Hat Man- pute with boards that have become state of Ohio economically by over Visit neorsd.org/opportunity to register! agement. We have frequently sug- unhappy with some of the provi- $140 million every year. Annually, gested that he visit our schools to sions that they negotiated in their we receive less than $30 million for see what is actually happening in contracts with White Hat. However educating these students. Our Hope Opening doors for Northeast Ohio minority-owned, our schools. the boards are not suing to termi- Academies provide education in women-owned, and small businesses. His column suggests that White nate these contracts, as Mr. Tucker the neighborhoods that have been Hat Management has not accounted states. virtually abandoned by the Cleve- to the public for “the millions in tax The lawsuit was filed May 17, land Public Schools. facebook.com/yoursewerdistrict dollars it receives.” Nothing could 2010, and the agreements expired White Hat succeeds in providing be further from the truth. This under their own terms on June 30, the best possible education solu- seems to be the same kind of 2010. The boards never asked for ter- tions at half the cost to the state as “urban legend” perpetuated by mination, and they asked that the Cleveland Public Schools. Tax White Hat’s critics. White Hat continue to operate the dollars provide Cleveland Public The Ohio Revised Code Section schools under the “terms of the ex- Schools facilities. Charter schools pay 3314.024 states that “A manage- isting agreements” until further or- for facilities from operating dollars. ment company … shall provide a ders from the court. On another note, if the 5,000 The New detailed accounting …” White Hat Under those contracts, we provide Cleveland residents who have chosen annually provides a “detailed a guarantee that all expenses will our schools instead chose Cleveland accounting” to the schools and to be paid by White Hat, even if the Public Schools, Cleveland taxpayers the Auditor of State. This procedure revenues to cover them are inade- would need to raise $38 million Ohio Budget was established in the late 1990s to quate. The schools have no risk of more for schools. School choice not comply with that section as part of loss whatsoever. only promotes individual empow- the process for auditing community The financial statements we are erment, it is also economical. Its potential schools. now being asked to submit are the I am enormously proud of the The Auditor of State reviews the very same as those that had previ- hundreds of dedicated teachers and expenditure of funds of each and ously been submitted both to the staff who work for White Hat in impact every school in Ohio, including boards and to the auditor. The Ohio dealing with students nobody those operated by White Hat Man- judge believes that there is greater else wants, and succeeding. The agement, according to these rules. “evidentiary value” to these being gratuitous criticism of what we do on your Not only have we complied with presented in the discovery process. by Crain’s and other media is un- all of these rules, we have received The judge will rule if we have com- warranted and unfair to them. commendations from the Auditor plied with the state statutes. I only ask for factual reporting. business of State each and every year our Mr. Tucker points out that char- Because of my political donations, schools have operated in Ohio. Not ter schools can achieve marvelous White Hat continues to be vilified. once have we received any criticism things. Our schools are dealing In spite of that, we are proud of our from the auditor about how we are with many of the most difficult- success stories and will continue to complying with the law. The same to-educate children. We operate 18 serve our students. cannot be said for the school schools in Ohio for drop-out recovery. ROUNDTABLEWEBCAST boards with which we contract, To date we have graduated over David L. Brennan Watch our live webcast from your computer! which are audited separately by the 10,000 students with high school Founder state auditor. diplomas and employment skills White Hat Management Thursday, August 25, 2011 Noon to 1:00 p.m. EDT RSVP: Call 216.348.5400 or visit www.mcdonaldhopkins.com View: Initiatives boost efforts to create new jobs

continued from PAGE 8 addition, the potential implemen- tives will complement the July 17 if their job-creating ventures are fully tation of an opportunity for appli- Immigration and Customs Enforce- developed and ready to be imple- cant interviews significantly will ment (ICE) Memo by director John A business advisory and advocacy law firm® mented. help clarify who is most deserving Morton, which outlines a frame- EB-5 applicants also will have the of EB-5 status. work with which ICE officers and McDonald Hopkins LLC option of requesting premium pro- I welcome these new initiatives prosecutors can exercise discretion 600 Superior Avenue East, Suite 2100, Cleveland, OH 44114 • 216.348.5400 cessing of their immigrant petition, to reduce barriers for job-creating with regard to deportations. That Carl J. Grassi Shawn M. Riley which significantly expedites pro- immigrant entrepreneurs and in- way, ICE can focus on the most President Cleveland Managing Member cessing in exchange for a fee, and vestors and wish the USCIS the best important removal priorities in order can be instrumental in whether an in successfully implementing these to help our country continue to Chicago • Cleveland • Columbus • Detroit • Miami • West Palm Beach investor with time deadlines chooses plans. progress as the great melting pot it to invest in the United States. In The new business-friendly initia- has always been. ■ www.mcdonaldhopkins.com 20110822-NEWS--10-NAT-CCI-CL_-- 8/18/2011 3:48 PM Page 1

10 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM AUGUST 22 - 28, 2011

ON THE RUN Hermes: Organization plans market expansion Hermes Cos.’ road racing division has grown steadily and now consists of 115 races; here are the company’s continued from PAGE 3 meet some people, have fun and part of a block party in the city’s kickball, softball and volleyball top-attended events (2010 numbers owns and operates a handful of get in shape.” Gateway District featuring bands leagues and tournaments. used for races not yet run this year): The growth reflects a rise in road and, of course, post-race beer. events, but mostly partners with new Handling the challenge or established race administrators to running nationwide. According to The race began in 2003 and has Race Number assist in marketing and registration the National Sporting Goods Asso- grown to 2,100 runners from 1,300 The company’s Corporate Chal- efforts, then manages much of the ciation of Mount Prospect, Ill., which at its start, Winking Lizard owner lenge hit a new high for participa- Turkey Trot, Nov. 5,200 surveys 40,000 U.S. households for John Lane said. Registration runs tion this summer, with 105 organi- race-day operations. President Neal St. Malachi Run, March 3,500 Neroni said when he and finance its annual sports participation survey, $20 to $30. Hermes either is paid a zations total; 70 of those competed manager Nick Swingos took over 35.5 million people age 7 or older flat fee by race organizers or gets a in “Corporate Cup,” in which they A Shot in the Dark, July 2,100 ran in 2010, up 10% from 2009. cut of race registrations. gathered points for their perfor- Hermes in 2000 — the company was Cleveland 10-miler, April 2,050 founded in 1981 — it managed 39 The company’s Cleveland 10- “They’ve been a great partner mances all summer. Hermes made races. Now, it has 115 on its sched- miler, along with its River Run half ever since we started,” Mr. Lane said. donations to the top finishers’ River Run half marathon, 1,300 ule, including 11 Susan G. Komen marathon (Sept. 11 along the Rocky “They handle permitting for the favorite charities. Other companies Sept. Race for the Cure events nationwide. River), are popular, as is its partner- party, the race operation, everything.” participate in an “independent” Run for the Border, May 1,250 “We get a phone call every day ship with the Winking Lizard Hermes, which has grown to 12 division, in which companies can for a new race,” said Mr. Neroni, restaurant chain for “A Shot in the full-time staff members and uses enter only events they choose. Pigskin Classic, Nov. 1,100 who said the company has about a Dark.” That race, which winds its up to a dozen interns each year, Sponsorship, too, remains steady, dozen races with over 1,000 partic- way downtown and into Cleve- also has a sport and social arm. It though Mr. Neroni said there Chili Bowl Classic, Feb. 1,000 ipants. “People want to get out, land’s Tremont neighborhood, is organizes activities such as adult always is room for growth in that area in the form of a title sponsor for Corporate Challenge, which the company has been unable to secure. Eleven of 14 events were sponsored this year; CBiz Inc., Titan Insurance and Kaiser Permanente were among the sponsors. Not only has Corporate Challenge grown here, but Hermes for the first time will take it elsewhere: On Aug. 27, it will stage a mini-challenge in Pittsburgh, with four events. Mr. Neroni said Hermes plans a full Pitts- burgh version in 2012; depending on how that expansion goes, it may try to move into other cities. CBiz, an Independence-based provider of accounting and business services, has sponsored Corporate Challenge softball for the last six years and also has multiple teams participating in each event. One reason for its involvement is that the events serve as team-building exercises, as the company’s employees are spread among its corporate office and sites in Cleveland and Akron. Director of corporate relations Lori Novickis said CBiz employees can earn a health care premium discount by participating in wellness activities, and Corporate Challenge events count. Also, CBiz sees the sponsorship as a marketing tool. “There are a lot of great and growing companies in Cleveland,” Ms. Novickis said, “and sponsoring and participating in this event is one way we can differentiate ourselves.” Ms. Novickis said the challenge also is a good morale booster, which has come in handy over the last few years as conditions at many area companies have gone south. Mr. Neroni agreed, and said when the economy really tanked in 2008 and 2009, participation in the challenge was stagnant, but it lost few past competitors. “Our pitch always was, ‘When times get tough, let’s keep the people ■ If you have an opportunity, we’re ready. This is no time to wait. And you have happy,’” Mr. Neroni said. we’re not. In fact, so far this year, we’ve extended nearly 10 billion dollars in credit to business customers, and we plan to lend another 28 billion dollars GET DAILY NEWS ALERTS FROM CRAIN’S! in the year to come. In addition to lending, we will keep supporting local businesses with ﬁnancial solutions and services that can improve productivity Register for free e-mail alerts and receive: and, ultimately, help them succeed. Find out how we can help you drive results ■ The Morning Roundup: A at 53.com/drivingresults or call 1-877-804-2091. collection of the day’s business news from Ohio’s daily papers ■ Breaking news alerts: When major news happens, you’ll know ■ Daily headlines: A collection of Crain’s-produced news and blog items from the day ■ Small Business Report: A Loans subject to credit review and approval. Rates may vary based on credit qualiﬁcations. Fifth Third Bank, Member FDIC. 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AUGUST 22 - 28, 2011 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 11 Research: New VP tasked with bringing faculty together continued from PAGE 1 some time to come, but that’s not to WISHES GRANTED that’s limited to academia, like For more than two decades, Dr. say it hasn’t been challenging in the getting the loading dock guy to talk to McGimpsey worked at the Worcester past,” he said. Grant McGimpsey, Kent State University’s vice president for research, wants to the CEO,” Dr. McGimpsey said. “My Polytechnic Institute, or WPI, in Kent State officials maintain they make sure the school is nabbing more money to bolster its recognition as a job is to ask various faculty in various Worcester, Mass., where he most haven’t failed in securing research research university. Kent State’s research awards declined in the 2009-2010 disciplines to present a problem and recently served as associate provost money in recent years, but Dr. school year after a sizable increase in 2008-2009 from the previous year. work with others to get a solution.” for research and director of its bio- McGimpsey noted that it hasn’t Last year, Kent State started engineering institute. grown at the rate some would have School year Dollars awarded Percent change moving toward more collaboration Dr. McGimpsey’s arrival at Kent preferred. Dr. Lefton, for one, noted through what Dr. Frank called “coor- State puts him at the helm of a far during a trustees meeting last 2009-10 $36,384,344 -21.5% dinated hires,” or the hiring of faculty broader research portfolio than that spring he would like to see as much 2008-09 46,323,361 42.9 members who can collaborate on of WPI, which is a markedly smaller as $100 million in research money particular research interests of the school with between 4,000 and flow into the university each year, 2007-08 32,425,410 -0.6 university that cross disciplines. As an 5,000 students compared with Kent whereas it hasn’t brought in more example, the university announced State’s roughly 40,000 across its than $46.3 million in any year over 2006-07 32,629,145 22.6 this summer it planned to hire a eight campuses. He also fills a role the last five years. theoretical materials physicist and a that has seen two leadership changes A university spokeswoman said physical organic chemist to study in recent years, though it’s one he the figures for research dollars Kent largely due to a dearth of state money. in general.” organic photovoltaics — a burgeoning views as ripe with opportunity, State secured during the last fiscal Regardless, John West, the research interest at Kent State in particularly given the increased year, which ended June 30, weren’t university’s former vice president of Get ’em talking which Dr. McGimpsey has a back- preference among bodies that fund yet available. However, provost research who stepped down in 2010 It may sound like an easy fix, but ground. research for projects crossing several Robert Frank, who is stepping down to return to the faculty full time, Dr. McGimpsey said one of the Ultimately, Dr. McGimpsey said, disciplines. at the end of the next academic said Kent State has made significant ways to bring more research dollars while increasing the number of Dr. McGimpsey said Kent State’s year, said last month that adminis- progress in its research programs into the university is to get faculty research dollars coming into the uni- research enterprise “obviously has trators were “worried” how the final over the last five to 10 years. Dr. across disciplines to work together versity is his first order of business, a lot of breadth — right from the numbers were shaping up. West cited the university’s success on research projects. For example, what really matters is what the uni- creative arts, performing arts, all the As of last May, Kent State had with liquid crystals and Kent State’s he said, Kent State’s new College of versity does with those dollars. way over to some pretty hard brought in only $25 million in business accelerator, Centennial Public Health has a tremendous “There are always a lot (of univer- physics and everything in between.” federal research dollars for the 2011 Research Park. amount of research expertise in sities) who raise their hands in the “There’s a lot of potential there to fiscal year, according to documents “There has been a steady focus in psychology and other social sciences air and say they have a billion dollars be supported further,” he said. “It’s obtained by Crain’s laying out Dr. areas where KSU can take a lead in that can be brought together to in research funding,” he said. “But my job to help define what those Frank’s stated goals and objectives excelling,” Dr. West said, “and on tackle particular public health prob- the question is — and I’m not sure areas should be in the future and for the year. Also, Kent State hadn’t translating research dollars into lems, such as obesity. what the answer is in all cases — how leverage all the strengths we have met its research financing goals for economic development and research “It is a challenge, but it’s not one well were those dollars used?” ■ here to do that.” the previous two years or its goal for the number of grant proposals Kick it up a notch for the last three, according to the Corralling research dollars isn’t documents. an easy task because of the turmoil The largest percentage decline in facing federal and state budgets that recent years came in the 2010 fiscal While old magazines are a finance a bulk of university research year, when the level of research projects, according to Dr. McGimpsey. support it secured fell 21% to $36.4 “It’s going to be challenging for million from $46.3 million — a drop collectible, in your business’s waiting area they just collect dust. With heavy inventory, GM limits pickup production By MIKE COLIAS larger-than-usual pickup inventory Automotive News partly because of an anticipated uptick in demand during the second General Motors is trimming output half of the year. at one of its truck plants, a sign that GM also is trying to build invento- the automaker is trying to whittle ries ahead of next year, when the down its historically high pickup plants will be down for several inventory. weeks as GM prepares to build the GM’s Fort Wayne, Ind., assembly next-generation pickup, which is plant, which makes full-size Chev- scheduled for a 2013 launch. Get TV and Wi-FiWi Fi togetherg for about rolet Silverado and GMC Sierra GM spokesman Jim Cain declined pickups, recently canceled Saturday to comment on production plans at shifts for the rest of the year, according Fort Wayne or GM’s other pickup to a posting on UAW Local 2209’s plants, which are in Flint, Mich., $19 A WEEK. website. The local represents Fort and Silao, Mexico. He reiterated that Wayne hourly workers. GM will adjust its inventory through A person familiar with the plans production changes, rather than in- said the plant had been working a centives. Saturday shift about half the time “We’ll make production adjust- since the start of the year. ments at different facilities to make Local 2209’s website posting said sure we have the right stock on the the elimination of Saturday shifts is ground,” he said. because of “the amount of trucks GM has not trimmed production we have had on hand.” at its Flint plant, another source Some analysts have expressed familiar with the matter said. The Make your waiting area worth the wait. concern over GM’s pickup inventory, plant recently added a third shift, a For more information and other package options call 1-866-791-2688 which hit a 122-day supply in June decision made in February in or visit www.waitingroomupgrade.com. before falling to 115 days at the part to fill healthy demand for the end of July. Analysts say an 80-day automaker’s heavy-duty pickups. inventory is typical for full-size GM also has scheduled an extra .ƤDQU@KHCTMSHKSNMDVBNLLDQBH@KRTARBQHADQRNE"NW .ƤDQU@KHCTMSHKSNMDVBNLLDQBH@KRTARBQHADQRNE"NW!TRHMDRR,@M@FDC6H %!TRHMDRR,@M@FDC6H %H@MCNQ"NW!TRHMDRR35HM"NMMDBSHBTS H@MCNQ"NW!TRHMDRR35HM"NMMDBSHBTS pickups. week of downtime at Fort Wayne 1GNCD(RK@MCNQ"KDUDK@MC .'"NW VHQDC RDQUHBD@AKDKNB@SHNMR ,HMHLTL XD@QRDQUHBDBNMSQ@BSQDPTHQDC -DVRTARBQHADQRNE Last month, GM U.S. sales chief following the usual two-week "NW!TRHMDRR,@M@FDC6H %H@MCNQSGDENKKNVHMF"NW!TRHMDRR35RDQUHBDRNMSGDOQHL@QXNTSKDSNMKX2S@QSDQ CU@MBDC35 Don Johnson said he expects the closure over the Christmas holiday, @MC-DVR@MC%HM@MBD3HDQVHKKQDBDHUD6H %HRDQUHBDENQʙ ODQLNMSG@MC35RDQUHBDENQʙ ODQLNMSG NQʙ ODQ VDDJ .ƤDQCNDRMNSHMBKTCDHMRS@KK@SHNM BNMRSQTBSHNM HMRHCDVHQHMF TR@FD DPTHOLDMS @OOKHB@AKDS@WDR RTQBG@QFDRNQEDDR M automaker’s pickup inventory to according to the posting on the Local '#35RDS@MC'#QDBDHUDQNQ"@AKD" 1#3,@QDQDPTHQDCSNQDBDHUD"NW'#RDQUHBD '#35RDSR@MCNSGDQBTRSNLDQ NVMDCCDUHBDR fall to around 200,000 units, or a 2209 site. That work is for “facility DPTHOODCVHSG@"@AKD" 1#L@XQDPTHQD@CHFHS@KRDS SNOQDBDHUDQHMNQCDQSNQDBDHUD@KKOQNFQ@LLHMFNOSHNMRNƤDQDCAX"NW 90-day supply, by year end. He upgrades and maintenance.” #HFHS@K"@AKD2, -TLADQNECHFHS@KNTSKDSRL@XADKHLHSDC KKOQNFQ@LLHMF@MCOQHBHMF@QDRTAIDBSSNBG@MFD /QNFQ@LLHMFL@X said GM would “match demand Last month, GM said it would spend U@QXAXKNB@SHNM .ƤDQ@OOKHDRSNMNMOTAKHBUHDVHMF@CCHSHNM@KBG@QFDRENQOTAKHBUHDVHMFL@X@OOKX "NWB@MMNSFT@Q@MSDD with our production decisions” and $328 million to overhaul the Flint TMHMSDQQTOSDCNQDQQNQ EQDD(MSDQMDSRDQUHBDNQSGDRODDCNEXNTQRDQUHBD BST@KRODDCRU@QX 1@SDR@MCA@MCVHCSGNOSHNMRU@QX @MC@QDRTAIDBSSNBG@MFD #HRBNTMSR@QDMNSU@KHCHMBNLAHM@SHNMVHSGNQHM@CCHSHNMSNNSGDQOQNLNSHNMR@MCB@MMNSAD@OOKHDC not use big discounts to move the plant to produce the next-generation SN@MXNSGDQ"NW@BBNTMS 2DQUHBDRMNS@U@HK@AKDHM@KK@QD@R .SGDQQDRSQHBSHNMR@OOKX g"NW"NL (MB CA@"NW trucks. truck. It hasn’t announced a similar "NLLTMHB@SHNMR-DV$MFK@MC@MCCA@"NW"NLLTMHB@SHNMR"KDUDK@MC QD@ KKQHFGSRQDRDQUDC Johnson said GM had built up a investment for Fort Wayne. ■ 20110822-NEWS--12-NAT-CCI-CL_-- 8/18/2011 1:23 PM Page 1

12 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM AUGUST 22 - 28, 2011

McClary and Angelique Rogers to Ditz, Theresa Wisniewski and Lori GOING PLACES managers; Krista Clarke to associate. Sullivan to in charge; Matt Stegmoyer AURUM WEALTH MANAGEMENT: and Adam Deal to level II accountants. JOB CHANGES FEDERAL RESERVE BANK OF Jacob C. Adamczyk to associate CLEVELAND: Paul Kaboth to vice vice president; Michael T. McKeown HEALTH CARE president, community affairs officer; DISTRIBUTOR to first vice president, director of CLEVELAND CLINIC: Dr. Brian J. Maria Bowlin and Matthew Hite to research; Leeann L. Schultz to vice FERGUSON ENTERPRISES INC.: assistant vice presidents. Bolwell to chairman, Taussig Cancer Kyle Grant to general manager, Ohio president, operations manager. Institute. Grant Edwards Myers region, Ferguson Heating & Cooling. FIFTH THIRD BANK, NORTHEASTERN BOBER MARKEY FEDOROVICH: OHIO: Russell L. Edwards to vice Tiffany L. Herbert to manager. president, retail regional manager; INSURANCE EDUCATION FIRSTCREDIT INC.: Kim Pohorence Jason Myers to vice president, busi- KAISER PERMANENTE, OHIO: and Catherine Stefaniak to client sup- GILMOUR ACADEMY: Diane ness banking relationship manager; Michelle Richter to senior director, port and commercial insurance billing Kingsley to director, lower school. Eric Schwarz to vice president, sales and marketing strategy; Kath- specialists; Robin Johnson-Kea, Timo- wealth management adviser. leen Stephens to director, sales and thy Lawson, Adrian Wells and Ursula ENGINEERING broker relations; Tracy L. Kanouff Williams to patient account managers. INTEGRATED ENGINEERING CON- FINANCIAL SERVICE to director of marketing strategy SINGER, BERGER, PRESS & CO.: and effectiveness; Diana Pisanelli to SULTANTS INC.: Clifton Hamner to APPLE GROWTH PARTNERS: Wayne Margaret Poderzay to accountant. director, account management and Schwarz Herbert Morales mechanical designer. Chamberlain to business valuation client support services. senior associate; Lindsay Cooper, SS&G HEALTHCARE SERVICES LLC: FINANCE Sean Cwynar and Paul Martin to Norma McCune to billing specialist. CITIZENS BANK: Bill Oskowski to senior associates; Kathryn Lee to WALTHALL, DRAKE & WALLACE LLP LEGAL branch manager, South Euclid. human resources manager; Tom CPAS: Kara Hoon to supervisor; Brian FISHER & PHILLIPS LLP: Michael

Lyall Pierce Gottschalk

A. Jackson to associate. MANUFACTURING GEBAUER CO.: Stephanie Morales to director, human resources. MYERS INDUSTRIES INC.: Ray Cunningham to vice president, human resources, organization development and training. OLYMPIC STEEL INC.: Andrew S. Greiff to president, specialty metals; Raymond Walker to senior vice president, eastern region; Michael J. We make it our Cedoz to vice president, automotive. MARKETING business to know ADCOM COMMUNICATIONS INC.: Maggie Lyall to senior copywriter; Laura Pierce to public relations manager; Megan Gottschalk to inte- your business. grated media manager. MARCUS THOMAS: Jennifer Hirt- Marchand, Jamie Venorsky and Jim Sollisch to associate partners. NONPROFIT Let’s get to know each other. GREAT LAKES SCIENCE CENTER: Laura Rayburn to vice president, Your business deserves more than one-size-ﬁts-all banking solutions. development. And that’s why we’re here. To listen, to learn, and to understand LAKE COUNTY YMCA OUTDOOR your business and your goals. It’s a story we’d like to hear. FAMILY CENTER: Jessica Martin to branch executive director. ELIZA JENNINGS SENIOR CARE firstmerit.com/youfirst NETWORK: Katie M. Krainz to vice president, marketing; Kara Serger to vice president, human resources. REAL ESTATE MIDWEST REALTY ADVISORS: Howard A. Davis to senior director, residential property management; Paul J. Stroud Jr. to senior director, commercial property management. SERVICE AREA PROFESSIONALS INC.: Stephanie Sfekas to talent acquisition director. TORCH GROUP: Lee Steinbock to project coordinator; Joshua Lapine to associate recruiter. TECHNOLOGY OVERDRIVE: Brian Gurewitz to director of content sales.

BOARDS TO LEARN MORE, contact us at 1-888-283-2303. PERSONAL BUSINESS COMMERCIAL WEALTH LAKEWOOD CHAMBER OF COM- MERCE: Diane Helbig (Seize This Member FDIC Day Coaching) to chairperson.

Send information for Going Places to [email protected]. 20110822-NEWS--13-NAT-CCI-CL_-- 8/18/2011 1:21 PM Page 1

SPECIAL REPORT

A DOSE OF REALITY: Is all this health care building good for us?

RUGGERO FATICA PHOTOS ABOVE LEFT: Dave Confer (foreground) and Justin Confer unload drywall at the work site for Summa Health System’s new $8 million emergency department at its Medina health center. ABOVE RIGHT: Brian Brake uses a cutoff saw to slice through concrete. BELOW: Summa joins the Cleveland Clinic and University Hospitals in expanding in Medina County. Growth spurt carries nearly $3B price tag Developing, wealthier areas fertile ground for building over past decade Latest technology, new facilities By TIMOTHY MAGAW Over the last 10 years, [email protected] Medina County’s population serve as tools for luring top docs has surged 14.1% while the f Northeast Ohio’s health state’s as a whole grew a octors matter, too. “That’s how you get patient flow care systems were award- mere 1.6%. As such, many of Bill Ryan, president of and how you get doctor loyalty,” winning chefs, Medina the region’s major health the Center for Health he said. County could be consid- care players have descended Affairs, noted that a Over the last seven years, for Iered one of their farmers’ upon the southern county, Dcentral piece of health care systems’ instance, University Hospitals markets of choice. staking their claims in an expansion strategies is the lofty has aggressively recruited doctors The booming county has effort to gain ground in one task of recruiting high-quality in Medina County, which served some of the region’s best in- of the state’s few growing physicians. as the precursor to the construc- gredients for maintaining a markets — a move many “It’s not about the direct attraction that’s taken place in the world-class health system: A suggest would help prop up tion to patients,” Mr. Ryan said. county, according to Dr. Michael growing population with the health care,” said Bethany Dentler, operations in poorer, more “Doctors bring patients to the Nochomovitz, president of money and means to finance care executive director of the Medina urban markets. hospital. Being able to have modern University Hospitals Physician without the aid of government County Economic Development While perhaps Medina County is operating rooms, high levels of Services. programs that have plummeting Corp. “Up until recently, there one of the most visible examples technology on site and being able “Our strategy always begins with reimbursement rates. were a lot of leakages outside the of the region’s competitive health to do more complicated surgeries physicians,” he said. “We had a “It’s a community with a little community. People were driving care market and building explo- and procedures at the hospital number of physicians who bit of disposable income, the right into more urban areas for their sion of the last decade, similar convinces doctors of a reasonable expressed interest in aligning with education mix and cares about health care needs.” See BUILDING Page 14 place to admit the patients. us.” — Timothy Magaw

Long-term demographic trends guide health care development

INSIDE: Population and income data residents rapidly. Population changes could affect viability, force ‘tough decisions’ show where we might expect more “As population shifts, usage building into the future. Page 16 rates just aren’t going to support By SCOTT SUTTELL “Everybody is attached to their affect who’s receiving medical care hospitals in every place they have [email protected] community hospital,” Dr. Cosgrove and where and how it is best deliv- operated,” Ms. Chollet said. said. “This is not like closing a paint ered. 24,317 in 2009 from 33,096 in 1990. A big challenge going forward, leveland Clinic CEO Toby factory. … These are emotionally In Cuyahoga County, for instance, Deborah Chollet, senior fellow then, is for health care systems to Cosgrove knows there’s no charged issues.” the population has dropped nearly and health economist at Mathe- deliver care to all who need it, even amount of patient usage And yet, Dr. Cosgrove and other 10% in just the last 20 years, to about matica Policy Research in Prince- as changes in population turn their statistics or demographic executives who run Northeast 1.28 million as of 2009, according to ton, N.J., said these sorts of popu- attention to higher-growth por- Cdata that make it easier for those Ohio hospitals can’t let emotions Census Bureau data. The decline lation changes make it “inevitable tions of their service areas. served by Huron Hospital in East get the best of them as they guide was quite a bit more pronounced in that health systems will make In Huron Hospital’s case, the Cleveland to accept that it no their health systems through a Huron Hospital’s home base of East tough decisions” about delivering Clinic in October is slated to open longer will offer inpatient and still-treacherous economy and Cleveland, where the population in care, particularly in cities and a $25 million community health trauma services as of today, Aug. 22. massive demographic changes that the last two decades fell 26.5%, to inner-ring suburbs that are losing See DECISIONS Page 16 20110822-NEWS--14-NAT-CCI-CL_-- 8/18/2011 2:28 PM Page 1

14 CRAIN’S CLEVELAND BUSINESS SPECIAL REPORT: A DOSE OF REALITY AUGUST 22 - 28, 2011 Building: Outpatient care a big focus

continued from PAGE 13 CLOSING UP SHOP patterns have blanketed the entire region. The following is a list of Center, Lorain According to data compiled by Northeast Ohio hospitals that (Followed merger with Lorain Crain’s Cleveland Business, have closed since 1990.* Community Hospital) nearly $3 billion has been allocated 2011 ■ Brentwood Hospital, Warrensville or spent since 2000 to new construc- ■ Huron Hospital, Cleveland Clinic, Heights tion dedicated to patient care in East Cleveland (Followed merger with Meridia Cuyahoga and contiguous counties. 2003 Suburban to become Meridia South Bill Ryan, president of the Center ■ Saint Michael Hospital, University Pointe Hospital) for Health Affairs, an advocacy Hospitals, Cleveland 1991 group representing area hospitals, ■ Deaconess Hospital, Cleveland ■ MetroHealth Hospital for Women said health care providers are 2000 (Booth Memorial Hospital), Cleveland expanding into new markets and ■ Mount Sinai Medical Center- 1990 adjusting their presences in existing University Circle, Cleveland ■ St. John Hospital of Cleveland, markets as health care delivery 1999 Cleveland evolves. ■ Saint Luke’s Medical Center, * Does not include facilities “I think what’s important and Cleveland specializing in mental and behavioral valuable about health care systems 1994 health and long-term care. is that unlike a lot of industry in this ■ St. Joseph Hospital and Health SOURCE: OHIO HOSPITAL ASSOCIATION town, they’re constantly looking at their infrastructure and what they need to do to upgrade in order to be competitive,” Mr. Ryan said. “If steel the hospitals and outpatient facili- As recovery times shorten and companies had done that, we still ties and look at the population as it an increasing number of procedures might be making steel in Northeast exists today, you wouldn’t be are able to be done on an outpa- Ohio.” putting hospitals or facilities where tient basis, occupancy rates at the they’re located,” Mr. Campanella region’s community hospitals Who wins? said. “I think over time there will continue to shrink. In Medina County alone, the be a hopefully orderly transition of Coupled with a dwindling popu- region’s three largest health care what makes sense.” lation, Dr. Cosgrove said the envi- systems expanded their operations Noting that the “days of the ronment has made it difficult for a in the market over the last three standalone hospital are numbered,” hospital to continue to do business years. Cleveland Clinic CEO Toby as usual. ■ The Cleveland Clinic in 2009 Cosgrove said the delivery of care Dr. Cosgrove noted that the acquired then-independent Medina has shifted from traditional hospital region’s hospitals are only at about General Hospital at the behest of settings to outpatient facilities — 68% occupancy, while one operates many of the area’s doctors, and the likes of which the Clinic has most effectively at about 85% breathed new life into the aging invested heavily in recent years. occupancy. The 137-year-old facility with about $24 million in “We are committed to all of the Huron Hospital saw fewer than 100 infrastructure upgrades and plans communities we’ve entered, but patients a day and less than 60% of for further investments to total $40 that’s not to say we’ll have the its 185 staffed beds were occupied million. same types of facilities there,” Dr. when the Clinic announced the ■ University Hospitals last year Cosgrove said. hospital would close. built a $10 million community The Clinic’s Huron Hospital in The region’s health systems also health center in Medina to bring its East Cleveland, for one, will stop have invested heavily in their physician practices together under offering inpatient and trauma already-thriving emergency rooms one roof, and it has plans for further services today, Aug. 22, and as they stare down the possibility growth in the community. shutter in early October to make of thousands of newly insured ■ Summa Health System in way for a $25 million health center. patients entering their doors because Akron invested about $8.5 million However, it’s not all doom and of the federal health care overhaul. of its own cash with additional gloom at the region’s community Likewise, a shortage of primary financial support from Signet hospitals, particularly in suburban care doctors has increased the Healthcare to build a health center areas where the population con- public’s reliance on emergency that opened last year, with an $8 tinues to grow. departments for routine care, and million new emergency department University Hospitals’ new $298 the health systems aren’t expecting slated to open this year. million Ahuja Medical Center, the demand to soften any time soon. Some question whether all this which opened this year in Beach- “When you put those pieces health care building is setting up wood, is at capacity, according to together, it’s almost a no-brainer, Northeast Ohio with an unsustainable the system’s CEO Tom Zenty. Mr. especially with expansion of health care landscape. Zenty noted that the hospital’s 53- coverage that will occur,” Summa As for Medina County, Ms. acre site could support two CEO Thomas Strauss said. “We’re Dentler said the market hasn’t been additional towers, which could very careful to expand penetration oversaturated, but others say it’s increase the hospital’s capacity to and access points and not over- only a matter of time, given the 600 beds. build the market.” WARNING: This activity may be habit forming. pace at which the region’s health Likewise, the inpatient population Summa and University Hospitals care systems are investing in the at the Clinic’s Medina Hospital have invested more than $40 community. continues to increase by about 8% million each in upgrading their “Ultimately, like any other initia- each year, and the hospital’s presi- emergency departments at their tive, some are going to be successful dent, Dr. Thomas Tulisiak, said the anchor hospitals — both of which and some will not,” said Thomas 118-bed facility plans to add an had been over capacity. Campanella, executive director of additional 23 beds over the next Close to homes Baldwin-Wallace’s health care MBA several months to accommodate program. “Some will thrive, some the growth. A growing trend on the part will grow and some will wind up “We’re focusing on what the of the health systems has been contracting or leaving Medina. folks in Medina County asked the building freestanding emergency Right now, it’s sort of in a state of Cleveland Clinic to do and bring in departments far from the systems’ flux, and they all think they’ll be the the services they’ve asked for,” he headquarters. FOR THE SAFETY & SECURITY. winner.” said. “We’ve seen an increase in Southwest General, for one, converted its urgent care clinic in When one door closes … our inpatient population and our THE CONVENIENCE & COMFORT. number of surgeries. It’s been a Brunswick to a 24-hour emergency THE RELIABILITY & PIECE OF MIND. Though the dirt continues to fly very positive response.” department in 2009, and ultimately as health care systems continue to built a new ER facility for the loca- YOU DESERVE TO FLY WITH AIR EXCELLENCE. pump millions of dollars into new Investment strategies tion. Summa and Akron General construction, Northeast Ohio has The Clinic, University Hospitals, Health System are building emer- had its fair share of health care Summa, the MetroHealth System, gency departments in Green and ABOVE AND BEYOND. providers close shop as the region’s Southwest General Health System Medina, and the Clinic and UH demographics continue to shift. and others have invested millions have invested in emergency care in Northeast Ohio alone has witnessed of dollars in new community Twinsburg. the closure of 16 hospitals since health centers. And given the increasing 877-AIR-EXC1 (877-247-3921) 1980, according to data from the The centers offer an array of competitiveness throughout the e-mail: [email protected] Ohio Hospital Association. outpatient services, and a number region, health care systems are FlyAirExcellence.com “If you’re looking at Northeast of them have full-service emer- making concerted efforts to bring Ohio and start from scratch with all gency departments as well. continued on NEXT PAGE ➤ 20110822-NEWS--15-NAT-CCI-CL_-- 8/18/2011 1:22 PM Page 1

AUGUST 22 - 28, 2011 SPECIAL REPORT: A DOSE OF REALITY CRAIN’S CLEVELAND BUSINESS 15

Robert B. Cooper’s family gave an undisclosed gift to Summa Benefactors play ‘critical’ roles in hospital building shortly after his mother died in 2001, when the system’s cancer center By MICHELLE PARK Clinic, said the process works sim- made their jobs more difficult, as known philanthropists say they don’t was in conceptual development. [email protected] ilarly at the Clinic. Clinical priorities some donors delayed giving and want to tell hospitals what to build. The $28 million Jean and Milton are used to plan building projects, others became more cautious. Lee G. Seidman and his wife, Cooper Cancer Center is named heir names grace many a and philanthropy comes into play However, they emphasized that Jane, have contributed millions to for his father and his mother, who new health care facility, once they’re identified, he explained. benefactors’ confidence and giving University Hospitals, which named was treated for cancer at Summa. but it is not philanthropists Generally, the region’s hospital are returning as the economy for them the Seidman Cancer His father took an active role in who dictate what is built by systems first identify their priorities displays signs of recovery. Center, and to the Cleveland Clinic, the design and implementation of TNortheast Ohio’s hospital systems. and then solicit donations from “The role (of benefactors) is which last November opened the the cancer center, Mr. Cooper “The philanthropic piece of the benefactors, many of whose phil- critical,” said Sherri L. Bishop, Jane and Lee Seidman Tower. Mr. noted. puzzle is exceptionally important, anthropic passions are known. chief development officer for Seidman said he hopes his family’s “It’s not so much about the naming but philanthropy is really not the “It’s not the other way around,” University Hospitals. “It’s rare that dollars go to defeat cancer, but rights,” said Mr. Cooper, a director driver for our building projects or said Mr. Chardiet, chairman of any hospital or health care system said his family makes no demands. for CB Richard Ellis. “The real goal for the growth of our system,” said institutional relations and devel- would be doing (building) without “There are people that tie their was to see the conditions improve Steven P. Schmidt, interim president opment. “There are certainly other philanthropy as part of the plan.” gifts to certain dictates,” said Mr. with a new building that would be and chief operating officer of the places that will do that. Most of the As University Hospitals develops Seidman, the original owner of state-of-the-art and help people at Summa Foundation and vice pres- time that’s not the way it happens its strategic plans, Ms. Bishop is The Motorcars Group. “That is not such a tough time. ident of clinical research and inno- here.” involved from the beginning to our style. We just choose not to “We get letters with some vation for Summa Health System. The executives who oversee develop, in concert, plans for give anybody instructions; we frequency from people who are Armando Chardiet, who oversees fundraising for local hospitals philanthropic funding, she said. hope that they will use it for the treated there, which is the nicest all fundraising at the Cleveland agree: The economic downturn Some of this region’s most well- best possible purpose.” reward,” he said. ■

continued from PAGE 14 health care close to their customers’ homes through new community health centers and freestanding emergency departments. “What we see looking at the demographics is that you have A LOAN WITH patients from Cuyahoga County who are moving to various other areas — Brunswick, Medina, wher- ever,” said Albert Matyas, vice president of ambulatory operations and business development at Southwest General. “You want to maintain those patients and keep them within your system, and patients want to be close to where their health care is.” The evolution of care The CEOs of the region’s heath care systems are quick to note they simply aren’t building for the sake A CITIZENS BANK LOAN LETS YOU FOCUS ON THE FUTURE ... of building, and that much of the because the businesses construction over the last decade that will succeed tomorrow are the ones that make the right choices today. They are has been the product of the evolution of health care delivery and a careful led by individuals who see opportunity for growth and expansion, and take action with evaluation of the marketplace. “We build new facilities when we complete conﬁdence. A loan from Citizens Bank will keep you moving forward and have a business plan that has the kind of returns that are required,” never wondering, “What could have been?” Mr. Strauss said. “We’re very cautious to make sure when we build facilities to have the return on Get the loan you deserve now. To make an appointment with a Citizens Banker, call investment and kind of balance 800-946-2264 CITIZENSBANKING.COM/BUSINESS sheet strengths that allow us to or visit . develop in the future.” But despite the recession and uncertainty surrounding health care reform, Dr. Cosgrove said, “I don’t think you’ll see a shortage of health care building in the future.” He noted that health systems are always looking to rebuild and renew their facilities in order to stay competitive and able to treat the health issues facing today’s population. Mr. Ryan of the Center for Health Affairs echoed Dr. Cosgrove’s comments, noting that the Huron Hospital closing is a perfect example of how health care has evolved in Northeast Ohio. Huron, he said, had served the community well during its lengthy tenure, but there comes a time when a breath of fresh air is needed in order to remain financially viable. As to whether all this building is sustainable, some say only time will tell. “It’s not impossible 20 years from now that the decisions we’ve made today have to be re-thought, but that’s not a bad thing,” Mr. Ryan said. “The agility of the health care leaders in this town and the flexibility they have in terms of making certain that they’re posi- tioned to effectively care for community has been pretty impressive in my lifetime.” ■ 20110822-NEWS--16-NAT-CCI-CL_-- 8/18/2011 1:45 PM Page 1

16 CRAIN’S CLEVELAND BUSINESS SPECIAL REPORT: A DOSE OF REALITY AUGUST 22 - 28, 2011

THE BIG SHIFT Decisions: Older residents Six of seven Northeast Ohio counties have grown in population during the past 20 years, and four of them have posted double-digit percentage gains. But the region’s overall population is up just 1% in that time, due to the shrinking of Cuyahoga make suburbs attractive County — a development health care providers must take into account as they assess new building opportunities. continued from PAGE 13 be sure, Medina County, at 174,035 County 2009 pop. 2000 pop. 1990 pop. % change, ’90-’09 center in East Cleveland to serve people in 2009, is less than one- Cuyahoga 1,275,709 1,393,978 1,412,140 -9.8% the community, and it has agreed seventh the size of Cuyahoga County.) to pay the city more than $8 million And it’s not just that the popula- Summit 542,405 542,899 514,990 5.3 over five years to offset lost payroll tion is growing outside the region’s tax revenue. core of Cleveland/Cuyahoga Lorain 305,707 284,664 271,126 12.8 Dr. Cosgrove said Clinic officials County — the demographic Lake 236,775 227,511 215,499 9.9 were cognizant of the need to makeup of the growth makes “blunt the blow” to East Cleveland outlying areas attractive for adding Medina 174,035 151,095 122,354 42.2 of the closing of Huron. But he health care facilities. acknowledged this might be a William Frey, senior fellow at the Portage 157,530 152,061 142,585 10.5 “special case,” due to the severe Brookings Institution and author Geauga 99,060 90,895 81,129 22.1 economic distress of the eastern of a recent study about the aging of suburb, and that there’s no guar- the U.S. population, found suburbs Total 2,791,221 2,843,103 2,759,823 1.1 antee any future hospital closings are aging more rapidly than cities, would be handled in the same way. with higher growth rates for their 45-and-older populations and care systems are seeking to accom- FOLLOW THE MONEY Where the patients are larger shares of seniors. modate them by building facilities The health care building boom For instance, Mr. Frey said, people in close proximity to the people Northeast Ohio’s two largest counties — Cuyahoga and Summit — are the only in Northeast Ohio to a large extent age 45 and older — the sweet spot leading this demographic shift. two counties in the region with median family income below the national average. is taking place outside Cuyahoga for demand for medical care — The aging of the U.S. population The two wealthiest counties — Geauga and Medina — also have posted the County, and that makes sense. now represent about 40% of subur- is well-documented, and Mr. Frey’s highest population growth in the region during the past 20 years. The region including Cuyahoga ban residents, compared with 35% study puts it in clear relief. The Median family income Per capita income and its six contiguous counties has of city residents. And the older a median age in the Midwest has County seen its population edge up only a person, the more likely he or she is risen to 37.7 years as of 2010 from (2009 dollars) (2009 dollars) bit more than 1% since 1990. But to live in a suburb, according to 32.9 in 1990. (In both categories, Geauga $79,876 $32,554 only Cuyahoga County, with its Mr. Frey’s study. For instance, 66% the Midwest is slightly older than nearly 10% population drop, has of people ages 15 to 24 live in the national median.) Medina 76,154 29,604 lost residents; all six of the con- suburbs, but that figure rises to Cleveland at present has one of tiguous counties have grown, led 72% for all age groups over age 45. the nation’s oldest population bases, Lake 66,526 27,514 by Medina County’s 42% increase “America is beginning to show with 15% of its residents age 65 or Portage 65,422 24,594 in the past two decades. (Though to its age,” Mr. Frey said, and health older, according to Mr. Frey’s study. Lorain 62,541 24,605

Summit 61,579 26,613

Cuyahoga 57,208 25,788

U.S. averages 62,363 27,041

Only 15 U.S. cities have a 15% share facilities, “must be made considering of their populations at age 65 and changing demographic realities.” over, and six of those are in Florida. But if the study shows that the Be prepared demographics of the Cleveland Tom Zenty, CEO of University market are favorable now to the Hospitals Health System, said the construction of health care facili- system is mindful of demographic ties, there’s some question as to trends and builds its facilities for how long that might be true. the long term. Outpatient care is The Cleveland area had the and will continue to be a focus of nation’s fifth-largest decline in new facilities, he said, as is making population of people age 45 and them “technologically adaptable” under, losing 10% of that population to accommodate changes in health from 2000 to 2010. (Youngstown care technology and to extend the had the biggest decline in under-45 life of the facilities. population, at 14%.) Cleveland is At UH’s new Ahuja Medical Cen- hardly alone in this predicament, ter in Beachwood, for instance, the though. Mr. Frey’s study found system is monitoring patient use of that in 36 of the largest 100 metro the center closely “to match demand areas in the United States, the and service offerings.” The property population below age 45 declined has about 50 acres that can be used in 2010 from 2000. for future expansion if, as expected, If such trends hold long term, he the center attracts greater numbers said, Cleveland and other regions of patients from outlying areas. with declining populations of “You can’t ... predict demand younger people might find them- based purely on demographics, selves overbuilt with health care but you can prepare,” he said. facilities 30 years from now. He Mr. Zenty said about 500,000 cautioned, though, that it’s difficult people live within a 10-mile radius to apply broad demographic of Ahuja. While the focus is on trends for the future to specific attracting those nearby patients, site-location decisions today. Mr. Zenty said Ahuja already is Rapidly changing health care receiving interest from patients in technology and other factors could Akron and Medina because the change these equations. hospital’s highway-friendly loca- In 1950, the average life expectancy tion makes access easy for people for men was about 70, and for who live in outlying areas. women it was about 75, according Dr. Cosgrove said the Clinic to the U.S. Census Bureau. Today, continues to see “tremendous due in large part to superior med- growth in outpatient” demand, but ical care, it’s about 77 for men and flat inpatient demand, in Cuyahoga 83 for women. By 2050, men are County. projected to live until about age 82, The Clinic has a national and while women make it to age 87. international brand, with operations As a result, Mr. Frey noted, even in Florida, Nevada and, soon, Abu with declining population numbers, Dhabi. He said the Clinic every week a region’s demand for health care receives inquiries about partnership services still could rise as people opportunities and listens to all of live longer. them in search of growth opportu- The bottom line, he said, is that nities outside Northeast Ohio. decisions about “age-related public “Our key bandwidth limitation is resources,” including health care people,” he said. ■ 20110822-NEWS--17-NAT-CCI-CL_-- 8/18/2011 2:25 PM Page 1

AUGUST 22 - 28, 2011 SPECIAL REPORT: A DOSE OF REALITY CRAIN’S CLEVELAND BUSINESS 17 Nationwide building focused on paying customers

By AMY ANN STOESSEL consolidation and affiliation, as Level I trauma center and adult the market took a double hit. [email protected] has been the case nationally, has burn center, according to a May Even so, Mike Kuntz, senior vice played a role in building projects. 2011 hospital construction update. president of Turner Construction rom the perspective of “The bigger you are, the more “It’s known as the safety-net Co. who is responsible for the firm’s Houston-based architect aggressive you are right now,” Mr. hospital,” Mr. Grover said. “One of national health care group, said he Ron Smith, health care Mulholland said. “The emphasis is the things their new facility is going believes the market for health care construction nationwide is going to renovation.” to do is draw a lot of new patients.” building is at least as robust as it was Fmoving in a different direction, Spencer Grover, vice president of That’s a sentiment he believes is a roughly two years ago. “It’s coming fueled by different factors than in the Indiana Hospital Association, driving force in general: “The build- back, and it’s coming back strong,” the past. And that may mean a said the largest health care building ing that you’re seeing right now is to he said. change in course for Northeast Ohio project in Indianapolis at present is attract the paying customer.” Medical office buildings and since this region’s building patterns an effort by Wishard Health Services outpatient facilities have become appear to align generally with what to replace the public hospital’s aging Aches and pains the order of the day, along with experts say is happening nationwide. complex. As for the economic downturn’s projects centered on patient satis- In addition to working in health As part of the multiphase project, effect on health care construction, faction and outcomes, a side effect care design for the past 25 years, a new, 1.2 million-square-foot Mr. Smith of the Academy of Archi- of health care reform. Mr. Smith is the 2011 president of facility is scheduled to open in 2014. tecture for Health called its effect Yet, “there’s still a shortage of nology may take the industry. the Academy of Architecture for The $754 million hospital part of “tremendous.” Add to the mix that quality health care facilities in the “If you look at the way we always Health, a component of the American the project will feature 327 inpa- the recession aligned with uncer- country,” Mr. Kuntz said. And, he thought of hospitals … all that’s Institute of Architects. tient beds in addition to an adult tainty over health care reform, and said, there’s no telling where tech- gone by the wayside,” he said. ■ The most recent wave of construction, which has taken place over roughly the past 10 years, has been driven primarily by demographics, competition and the need for replacement hospitals, he said. “I think there’s been a definite shift in the last couple of years,” he said. Mr. Smith described the recent evolution of health care design and construction as first driven by the 1946 Hill-Burton Act, which was legislation that set up shared federal and state financing for hospital construction. Its effect lasted through the 1970s, he said, and it created a “whole generation of hospitals designed around a set of guidelines.” Next came the ’80s and ’90s, when there was a movement centered on the notion that more thoughtful design of the health care environment would affect in a positive way those being treated and working in it. As such, he said, many decisions were made with an eye toward delivery of care and technology. While those concerns still may be top of mind, Mr. Smith said he expects the next era of health care construction will be more related to the business model of health care. “The general hospital model of the past … is sort of being taken apart and realigned,” he said. Hoosier health care Ohio’s neighbor to the west, Indiana, has experienced a health care building boom similar to that seen in Northeast Ohio and elsewhere. Shawn Mulholland of BSA Life- Structures in Indianapolis, a design firm with a health care focus that also has offices in Chicago and St. Louis, called what’s happened in Indiana’s capital “the arms race of trying to beat out the competitor.” Indeed, Indiana was among the top six states for new hospital construction as of November 2010, according to information from Reed Con- struction Data, published by Health Facilities Management magazine in its 2011 hospital building report. (Other states falling into the top category of $1 billion or more in After delivering all four of my children at MetroHealth, I wouldn’t new hospital or outpatient clinic go anywhere else for my family’s pediatric care. In our busy MetroHealth provides construction are California, Georgia, Illinois, Texas and Virginia. Ohio house, we can’t afford to be sick. Fortunately, their caring staff convenient care for your shared the second-tier ranking, goes above and beyond to keep our kids well. And should the family at 16 community health $500-$999.9 million of construction, unexpected happen, it’s comforting to know MetroHealth has centers from Pepper Pike to with nine other states.) the services and expertise to bring us all back to health. Mr. Mulholland said the Indi- Westlake and from Cleveland anapolis health care market is I am Karolyn of Strongsville, and MetroHealth keeps my to Strongsville. much like Cleveland’s in that there family going strong. are several key health care systems. In Indy, however, there are four basic competitors, each with a smaller market share and each with a pre- dominant area it serves. Like Northeast Ohio, there has thecomeback.org been movement among providers into each other’s territories. Also, 20110822-NEWS--18-NAT-CCI-CL_-- 8/18/2011 1:30 PM Page 1

18 CRAIN’S CLEVELAND BUSINESS SPECIAL REPORT: A DOSE OF REALITY AUGUST 22 - 28, 2011

A DOSE OF NEARLY $3 BILLION IN HEALTH CARE CONSTRUCTION REALITY SINCE 2000

Crain’s Cleveland Business asked the region’s major health care systems and providers for lists of new facilities and additions built since 2000. Systems were asked to report only new construction rather than renovations or leases. Only construction related to direct patient care is included.

1. AKRON Mercy • Emergency department expansion at Fairview Akron Children’s Hospital • Mercy Avon health campus, 2013 (expected) Hospital, 2013 (expected) • William H. Considine Professional Building $17-$21 million; 82,000-square-foot campus $76 million; 125,000-square-foot addition will (see inset) will offer primary care, surgery and other add emergency and intensive care space services Mercy • Akron Children’s Hospital North addition, 2004 The MetroHealth System Mercy Cancer Center, 2002, $27 million; added 70,000 square feet, 3. BARBERTON • Critical Care Pavilion, MetroHealth Medical Elyria including an intensive care unit, burn center Summa Health System Center, 2004 $8 million; outpatient facility and helipad • Heart and Vascular Center at Barberton $70 million; 150,000-square-foot facility offering radiation and Hospital (now Summa Barberton Hospital), houses the emergency, surgery and endoscopy oncology services • Akron Children’s Hospital East addition, 2005 2005 centers $11 million; added 26,000 square feet, $12 million; built in two phases, the center including two new surgical suites houses cardiac services • MetroHealth Broadway Health Center, 2004 $6.5 million; 45,000-square-foot health center • Emily Cooper Welty Expressive Therapy Center, • Parkview Center at Barberton Hospital (now houses primary care, obstetrics, dentistry and 2011 Summa Barberton Hospital), 2006 other services $1.8 million; 3,000-square-foot addition $11-$12 million; 25,000-square-foot facility dedicated to holistic healing through the arts housing medical and radiation oncology, breast • MetroHealth Buckeye Health Center, 2005 17 imaging, outpatient chemotherapy $3.5 million; 25,000-square-foot health center 32 Akron General Health System offers primary care, obstetrics, cardiology, 26 • Montrose/Bath Township Emergency • Emergency department at Summa Barberton nephrology and other services 2 CUYAHOGA Department, 2009 Hospital, 2013 (expected) $7.6 million; emergency department with a full $19 million; the new department will increase University Hospitals 21 range of diagnostic and laboratory services the number of beds from 18 to 32 and triple • Center for Emergency Medicine at Case the size of the facility Medical Center, 2011 11 Summa Health System $41 million; 23,000-square-foot emergency 29 • Center of Excellence at Summa Akron City 4. BEACHWOOD department expanded to 54,000 square feet 22 Hospital, 2003 University Hospitals LORAIN $24.6 million; facility houses patient care and • UH Ahuja Medical Center, 2011 • UH Seidman Cancer Center, 2011 physician offices $298 million; 144-bed center offers $260 million; 375,000-square-foot center 5 inpatient, outpatient and emergency services consolidated UH’s cancer services under one 16 • Professional Center at Summa Akron City roof Hospital, 2004 • Rehabilitation hospital, 2012 (expected) $9 million; facility houses administrative $17 million; a joint venture with Centerre • Breen Breast Health Pavilion at UH Seidman offices, physician offices and patient rooms Healthcare of Nashville, Tenn., the 50,000- Cancer Center, 2011 square-foot facility will offer an array of $6.5 million; pavilion provides comprehensive MEDINA • Ann and David Brennan Critical Care Center, therapy services. breast health services 20 2006 $35 million; 120,000-square-foot facility with 5. BRUNSWICK 8. CONCORD TOWNSHIP 96 beds and a restaurant Cleveland Clinic University Hospitals • Brunswick Family Health Center, 2008 • UH Concord Health Center, 2009 • Jean and Milton Cooper Cancer Center $13.6 million; facility houses primary care, $29 million; offers an urgent care, primary care 31 at Akron City Hospital, 2008 cardiology, neurology and other services and specialty services $28 million; 77,000-square-foot facility with research offices, infusion center, cancer Southwest General Health System Lake Health treatment and MRI imaging • Southwest General Brunswick Medical Center • TriPoint Medical Center (see inset) (see inset) • University Park YMCA, 2010 • TriPoint Medical Center Physician Pavilion, $11 million (Summa split cost with YMCA); • Southwest General Brunswick emergency 2009 facility houses a rehab clinic and YMCA services room, 2010 $18 million; pavilion is home to various Lake $5.2 million; expansion includes an ambulance Health primary care and specialty physicians Southwest General Health • Rehab hospital, 2011- 2012 (expected) * bay, trauma rooms and 10 private treatment Brunswick Medical Center, $19.6 million; a partnership with Vibra rooms 9. CUYAHOGA FALLS 2008, Brunswick Healthcare, the rehab hospital will have 60 Summa Health System $14.1 million; 40,000-square- inpatient beds and a rehab center 6. CHESTERLAND • ICU at Cuyahoga Falls General (now Summa foot building houses physicians University Hospitals Western Reserve Hospital), 2000 and a variety of outpatient • Emergency department at Summa Akron • UH Chesterland Health Center (see inset) $6.4 million; 30,000-square-foot addition, services City Hospital, 2012 (expected) includes an intensive care unit and other $49 million; department will include 73 exam 7. CLEVELAND services rooms, 10 triage rooms and administrative Cleveland Clinic AkronAk Children’sChild ’ Hospital H il offices • Center for Autism, Shaker Campus, 2008 10. EAST CLEVELAND William H. Considine $8.3 million; autism treatment services, Cleveland Clinic Professional Building, 2003, 2. AVON including diagnostic services and training for • Huron Community Health Center, Akron Cleveland Clinic parents 2011 (expected) $43 million; 246,000-square- • Avon Family Health and Surgery Center, $25 million; 50,000-square-foot facility will foot building with pediatric 2011 (expected) • Miller Family Pavilion (see inset) offer primary and specialty care specialty offices, an audito- $97 million; 190,000-square-foot facility will rium and other offices include an emergency department and other • Glickman Tower, 2008 11. ELYRIA services $112 million; 330,000-square-foot tower EMH Healthcare houses the urological and kidney institute • Physician Access Center at Elyria Medical EMH Healthcare Center, 2009 * For any future/proposed projects reported by health systems, expected completion dates • EMH Avon Emergency Care Center, 2005 • Pathology & Laboratory Medicine building; Cost not provided; 15,000-square-foot addition and estimated costs are included. Cost not provided; freestanding emergency 2011 (expected) to main campus with office space for physicians department with 18 patient bays, on-site $72.5 million; 135,000-square-foot building laboratory and imaging services will focus on medical testing capabilities Mercy • Mercy Cancer Center (see inset) 20110822-NEWS--19-NAT-CCI-CL_-- 8/18/2011 1:30 PM Page 1

AUGUST 22 - 28, 2011 SPECIAL REPORT: A DOSE OF REALITY CRAIN’S CLEVELAND BUSINESS 19

Lake Health TriPoint Medical Center, 2009, Concord Township $155 million; 300,000-square-foot facility has 119 private patient rooms and replaces East Medical Center in Painesville

12. EUCLID • Summa Health Center at Lake Medina, 2011 27. STOW Cleveland Clinic (expected) Akron General Health System • Emergency department, Euclid Hospital, 2007 $8 million; freestanding emergency depart- • Stow Health & Wellness Center, 2007 $5 million; 8,000-square-foot expansion to the ment will include 14 exam rooms and a $31 million; full-service, medically based hospital’s emergency unit conference area fitness center with an emergency ClevelandC Clinic department and other services MillerM Family Pavilion, 2009, 18 13. GARFIELD HEIGHTS University Hospitals CCleveland Cleveland Clinic • UH Medina Health Center, 2010 • Stow Medical Office Building, 2009 $504$ million; home of the • OR expansion, Marymount Hospital, $10 million; facility brings together UH $7 million; located on the Stow Health hearth and vascular institute 2013 (expected) physician practices, offers additional specialty & Wellness Center’s campus, facility houses aand entrance to the hospital 8 $45 million; 74,000-square-foot services physician offices renovation and expansion project, which LAKE features new operating rooms 21. MIDDLEBURG HEIGHTS 28. STREETSBORO Southwest General Health System Summa Health System 34 • Emergency/ICU expansion, Marymount • UH Ireland Cancer Center at Southwest • Robinson Health Center at Streetsboro 33 Hospital, 2007 General (now UH Seidman Cancer Center at (see inset) $25.3 million; new critical care tower houses Southwest General), 2000 a 30-bed emergency department and expands $7.6 million; community-based location of 29. STRONGSVILLE 12 28-bed intensive care unit University Hospitals’ cancer services Southwest General Health System • The Thomas P. Perciak Family Residential 14. GREEN 22. OBERLIN Hospice, 2002 6 Summa Health System Mercy $3.4 million; facility features 10 private rooms 10 19 • Summa Health Center at Green, 2000 • Mercy Surgery Center at Mercy Allen Hospital, and is staffed 24 hours a day 7 GEAUGA $11.2 million; nearly 100,000-square-foot 2005 facility with imaging, fitness programs, lab $4.6 million; 15,000-square-foot center has 30. TWINSBURG 4 services and other programs 16 beds, two large surgery suites and other Cleveland Clinic 23 services • Twinsburg Family Health and Surgery GA • Green emergency department, 2011 or 2012 Center, 2011 13 (expected) 23. ORANGE VILLAGE $96 million; 190,000-square-foot center houses 24 $17 million; new emergency department University Hospitals an emergency department and other services includes 16 exam rooms and an imaging suite • UH Chagrin Highlands Health Center, 2001 $26 million; facility offers primary and specialty University Hospitals Akron General Health System care, women’s health and other services • UH Twinsburg Health Center, 2007 30 • Green Health & Wellness Center, 2012 $18 million; facility offers primary care, (expected) 24. PARMA specialty care and other services. UH Parma Community General Hospital 28 $40 million; 100,000-square-foot facility will invested an additional $2.4 million for a PORTAGE include a medical office building, emergency • Cancer Center/Medical Arts Center 3, 2000 new emergency department. 15 department and other services $7.3 million; facility offers outpatient cancer treatment and office space for physicians 31. WADSWORTH 15. HUDSON Summa Health System SUMMIT27 Summa Health System • Residential hospice, 2001 • Founders Hall at Wadsworth-Rittman • Summa Wellness Institute, 2007 $2.6 million; hospice facility has 10 beds and is Hospital (now Summa Wadsworth-Rittman staffed 24 hours a day 25 $15 million; health center offering fitness Hospital), 2001 9 equipment, a track and sports performance $8.7 million; four-story facility houses clinic • Intensive care unit addition, 2003 administrative departments, pharmacy, 1 $6.5 million; 18-bed intensive care unit cafeteria and nutrition services 16. LAGRANGE Mercy • SurgiCenter, 2003 • ICU at Summa Wadsworth-Rittman • Mercy Primary Care in LaGrange, 2008 $9.7 million; outpatient surgery center with a Hospital, 2010 3 $813,271; a partnership between Mercy connecting bridge to the hospital $1.8 million; built a new second floor onto the Medical Partners and Mercy Allen Hospital, the hospital building and doubled the number of 14 office features four exam rooms • Medical Arts Center 4; 2003 rooms for the intensive care unit $7 million; facility houses medical offices 17. LORAIN • Emergency department at Summa Mercy 25. RAVENNA Wadsworth-Rittman Hospital, 2011 (expected) • The Stroke Center at Mercy Regional Medical Summa Health System $3.2 million; will increase the emergency Center, 2008 • Emergency department at Robinson department’s size from 9,300 to 16,000 $1 million; center is a nine-bed unit consisting Memorial Hospital, 2000 square feet and its capacity by 20 beds of 6,000 square feet offering a private $9.6 million; doubled size of emergency environment for stroke treatment and recovery department by adding about 10,000 square University Hospitals feet • UH Sharon Health Center, 2010 18. MADISON $3 million; facility houses a Seidman Cancer University Hospitals Lake Health • Radiology department at Robinson Memorial Center, family medicine practice, laboratory • Freestanding emergency department at Hospital, 2002 and radiology services UH Chesterland Health Madison Campus, 2011 $10 million; doubled the size of the radiology Center, 2004, Chesterland Summa Health System $4.7 million; 10,000-square-foot facility department, adding 15,000 square feet 32. WESTLAKE $2.5 million; facility offers Robinson Health Center at features 10 private treatment rooms, two St. John Medical Center primary care services, Streetsboro, 2010, private trauma rooms and one private • Robinson Professional Center, 2009 • Emergency department and chiller plant, physical therapy and other Streetsboro behavioral health observation room $13.8 million; 59,000-square-foot facility for 2004 $23.2 million; 76,000-square- services an endoscopy center and congestive heart $15.5 million; ED offers 26 treatment rooms, foot outpatient facility 19. MAYFIELD HEIGHTS failure clinic including two trauma rooms consolidated existing Cleveland Clinic services in the city and added • Hillcrest Hospital expansion and renovation, • Surgery department at Robinson Memorial 33. WILLOWICK additional services such as 2011 Hospital, 2011 Lake Health imaging, wound care, sports $163 million; project included the new six- $19.7 million; 20,000-square-foot addition for • Willowick Campus, 2008 medicine, mammography story Jane and Lee Seidman tower that added eight new operating rooms $4 million; 15,000-square-foot center offers and others 72 private rooms to the hospital urgent care, primary care and other services 26. SHEFFIELD VILLAGE 20. MEDINA EMH Healthcare 34. WILLOUGHBY Summa Health System • EMH Sheffield Medical Building, 2006 Lake Health • Summa Health Center at Lake Medina, 2010 Cost not provided; three-story medical office • West Medical Center Physician Pavilion, 2005 $8.5 million (Summa’s investment); outpatient building housing orthopedics and physical $10 million; 75,000-square-foot addition Information compiled by Timothy Magaw health center is a partnership with Signet therapy services houses the system’s center for sports medicine Map by Lauren Rafferty Healthcare and rehabilitation 20110822-NEWS--20-NAT-CCI-CL_-- 8/19/2011 10:22 AM Page 1

20 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM AUGUST 22 - 28, 2011 LARGEST NURSING HOMES

RANKED BY NUMBER OF CERTIFIED BEDS(1)

Name Medicare Address Certified provider Net patient Net income/ # of FTE Type of Rank Phone/web beds number Assets ($) revenue ($) (loss) $ employees Cost report date ownership Administrator

Menorah Park Center for Senior Living 1 27100 Cedar Road, Beachwood 44122 360 365094 11,051,829 47,921,595 (665,014) 475.0 June 30, 2010 nonprofit Steven Raichilson (216) 831-6500/www.menorahpark.org West Bay Care and Rehabilitation 2 27601 Westchester Parkway, Westlake 44145 303 365451 4,534,205 17,235,420 454,014 198.0 Dec. 31, 2009 proprietary, Karen Williams (440) 871-5900/www.sunbridgehealthcare.com corporation Park East Care and Rehabilitation 3 3800 Park East Drive, Beachwood 44122 274 365810 6,321,436 21,780,060 96,220 231.0 Dec. 31, 2009 proprietary, Bernard Centa (216) 831-4303/www.sunbridgehealthcare.com corporation Montefiore 4 One David N. Myers Parkway, Beachwood 44122 268 365046 33,574,950 27,088,501 (305,172) 329.9 June 30, 2010 nonprofit Lauren B. Rock (216) 360-9080/www.montefiorecare.org St. Augustine Manor 5 7801 Detroit Ave., Cleveland 44102 248 365883 9,755,893 18,852,778 892,162 188.0 Dec. 31, 2009 nonprofit Andrew Koha (216) 634-7400/http://staugustinemanor.org Center for Clinical Care 6 8800 Carnegie Ave., Cleveland 44106 220 365948 2,216,554 7,963,240 (1,440,090) 119.5 Dec. 31, 2009 proprietary, NA (216) 229-3300 corporation Broadview Nursing Home 7 5520 Broadview Road, Cleveland 44134 218 365757 1,963,774 17,536,178 596,894 212.6 Dec. 31, 2009 proprietary, Isaac Lifschutz (216) 749-4010/www.broadviewmulticare.com corporation ManorCare Rocky River 8 4102 Rocky River Drive, Cleveland 44135 210 365392 2,242,638 12,017,113 833,412 150.6 May 31, 2010 proprietary, Jody McConnell (216) 251-3300/www.hcr-manorcare.com other Willow Park Skilled Nursing & Rehab.Center 9 18810 Harvard Ave., Cleveland 44122 209 365828 2,356,732 11,632,339 342,253 169.1 Dec. 31, 2009 proprietary, Terri Plush (216) 752-3600/www.atriumlivingcenters.com other University Manor 10 2186 Ambleside Road, Cleveland 44106 208 365832 1,619,748 8,439,126 (295,026) 126.5 Dec. 31, 2009 proprietary, Robert Peterson (216) 721-1400 corporation Carington Park 11 2217 West Ave., Ashtabula 44004 207 365286 18,953,619 12,875,325 2,516,539 170.0 Dec. 31, 2009 proprietary, Kelly Johnson (440) 964-8446/www.carington.com corporation ManorCare Euclid Beach 12 16101 Euclid Beach Blvd., Cleveland 44110 202 365594 2,121,542 11,841,526 693,749 147.6 May 31, 2010 proprietary, Joe Wilson (216) 486-2300/www.hcr-manorcare.com other St. Luke Lutheran Community-North Canton 12 220 Applegrove St. NE, North Canton 44720 202 365521 14,242,084 15,850,901 805,840 249.0 Dec. 31, 2009 nonprofit Jeannie Williams (330) 499-8341/www.stlukelutherancommunity.org

HOW WILL YOU HANDLE FUNDING CUTS? CALL US. Denise Gadomski 216.274.6514 • [email protected]

Andover Village Retirement Community 14 486 S. Main St., Andover 44003 200 365411 2,592,792 11,360,645 (854,761) 222.0 Dec. 31, 2009 proprietary, Fawn Phillips (440) 293-5416/www.andovervillageretirement.com partnership Hanover House Nursing and Rehabilitation Center 14 435 Avis Ave. NW, Massillon 44646 200 365292 2,022,455 8,994,050 588,889 164.2 Aug. 31, 2009 proprietary, Robert Knapp (330) 837-1741/www.communicarehealth.com corporation Omni Manor 14 3245 Vestal Road, Youngstown 44509 200 365433 11,629,356 13,250,502 1,338,156 195.0 Dec. 31, 2009 proprietary, Paul Fabian (330) 793-5648/www.windsorhouseinc.com corporation Pleasant Lake Villa 17 7260 Ridge Road, Parma 44129 199 365706 4,516,583 19,235,055 1,022,376 260.6 Dec. 31, 2009 proprietary, James J. Taylor (440) 842-2273/www.lhshealth.com corporation Crandall Medical Center 18 800 S. 15th St., Sebring 44672 198 365574 4,168,146 15,582,124 918,648 232.6 Dec. 31, 2009 nonprofit Robert Cameron (330) 938-6126/www.copelandoaks.com Golden Living Center at Western Reserve 18 9685 Chillicothe Road, Kirtland 44094 198 365290 1,985,720 10,540,447 (14,304) 73.0 Dec. 31, 2009 proprietary, Amanda Eberhart (440) 256-8100/www.goldenlivingcenters.com corporation Greenbrier Senior Living Community 20 6455 Pearl Road, Parma Heights 44130 194 365192 2,566,878 3,557,840 64,943 151.0 March 31, 2010 proprietary, Jill Burke (440) 888-5900/www.communicarehealth.com corporation Lutheran Home at Concord Reserve 21 2116 Dover Center Road, Westlake 44145 192 365020 42,204,425 16,602,240 (2,330,032) 231.4 Dec. 31, 2009 nonprofit Jean Hollenbeck (440) 871-0090/www.concordreserve.org Wickliffe Country Place 22 1919 Bishop Road, Wickliffe 44092 188 365381 4,141,930 14,060,238 842,391 201.5 Dec. 31, 2009 proprietary, Deborah Farris (440) 944-9400/www.lhshealth.com corporation Lake Pointe Health Center 23 3364 Kolbe Road, Lorain 44053 182 365623 2,057,816 12,164,889 (203,491) 155.8 May 31, 2010 proprietary, Terri Durkin-Williams (440) 282-2244/www.communicarehealth.com corporation Briarfield at the Ridge 24 3379 Main St., Mineral Ridge 44440 180 365823 12,863,947 10,250,233 787,338 142.0 Dec. 31, 2009 proprietary, Stacey Bettura (330) 652-9901/www.briarfield.net partnership Suburban Pavilion 24 20265 Emery Road, North Randall 44128 180 365215 2,438,825 8,514,918 (32,391) 145.1 Aug. 31, 2009 proprietary, Mark Grippi (216) 475-8880/www.communicarehealth.com corporation Wyant Woods Care Center 24 200 Wyant Road, Akron 44313 180 365779 1,821,918 3,187,348 104,884 130.8 March 31, 2010 proprietary, Judy Dennis (330) 836-7953/www.communicarehealth.com corporation Pleasantview Care Center 27 7377 Ridge Road, Parma 44129 179 365084 1,199,622 15,879,602 45,688 205.0 Dec. 31, 2009 proprietary, David Farkas (440) 845-0200/www.pleasantview-care-center.com corporation (1) Information is from SNFData Resources LLC, www.snfdata.com and the nursing homes. Crain's Cleveland Business does not independently verify the information and there is RESEARCHED BY Deborah W. Hillyer no guarantee these listings are complete or accurate. We welcome all responses to our lists and will include omitted information or clarifications in coming issues. 20110822-NEWS--21-NAT-CCI-CL_-- 8/19/2011 3:24 PM Page 1

AUGUST 22 - 28, 2011 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 21 Expand: Defense, medical device work orders bustle continued from PAGE 3 But, at the end of the day, it’s his end medical imaging equipment. end of 2010. Since then, he has been faith in his own company and To continue to grow, Astro likely busy rewiring the building for the employees that is driving the expan- will need more space, and it’s electricity-hungry heavy equipment sion, Mr. Sustar said. considering a purchase of Fredon’s that Fredon uses, while at the same “This, I can control, I have full older, 40,000-square-foot building on time doubling the building’s size with control over what goes on here — I Enterprise Drive that Mr. Peterson a 33,000-square-foot expansion. don’t have any control over that said could house Astro’s medical He also bought an adjacent two- other stuff,” he said. device operations. acre parcel, bringing the total property Down the road in Eastlake, No decision has been made or is size to eight acres. another contract machine shop and imminent, “but there are definite Mr. Sustar said his business has even larger manufacturer, Astro plans to grow our medical division,” emerged from the recession with Manufacturing and Design, is expe- Mr. Peterson said. strong sales. And while Mr. Sustar riencing the same growth, said its “They are bursting at the seams out often is quite skeptical about the vice president, Rich Peterson. there, and sales are strong,” he said. government’s handling of the econ- Like Fredon, Astro does a lot of At present, Astro has about 60 omy — and always critical of deficit business in the aerospace, defense employees at its Mentor plant on spending — he said he was not so and medical device markets. Mr. Industrial Park Boulevard, which worried as to forestall expansion. Peterson said those areas, especially mainly makes implantable medical Even since the recent downgrading medical devices, are going gang- devices, such as orthopedic screws and of the U.S. credit rating and related busters. Astro makes small medical plates. The rest of its 275 employees wrangling over government spending, devices used in surgery, as well as are in Eastlake, where Astro makes RUGGERO FATICA none of his customers have canceled components for large equipment components for Philips, surgical Roger Sustar, CEO of Fredon Corp., said the company plans to move by spring any orders or indicated they are for Philips Healthcare, which pro- simulators and other larger medical 2012 from its 40,000 square-foot Mentor facility to a building that will have slowing down, he said. duces CT scanners and other high- equipment. ■ about 65,000 square feet of space, once renovations there are complete.

Buybacks: Cash allows for purchases Shows: Other fixes help

continued from PAGE 1 combined purchases during the fiscal company believes its future is solid continued from PAGE 1 Cleveland, and that’s an area our show Invacare’s reduced valuation. The years that ended June 30, 2011, and that (the stock) is worth more regularly, Mr. Julian said. But when has expanded into, not just health company, which makes wheelchairs 2010 and 2009. than what it’s currently trading at,” the city’s old convention center fell care, but biomaterials generally.” and other long-term care products, Its repurchase amounts were much Mr. Eisele said. “If we would think behind to newer meeting halls in So, the Rubber Division is coming has had steady earnings improve- higher in 2008 and 2007, when the it’s worth less, theoretically, we other cities, and eventually was closed, back — and going forward intends ment and strong cash flow, Mr. company bought more than 1 million wouldn’t be buying it.” Cleveland just could not compete as to hold its major show every other shares each year, Mr. Eisele said. Blouch noted. Walking the talk a venue. Now that’s changing, and year in Cleveland, Mr. Miller said. “Therefore, we view it as a strong “We obviously pulled back during some of the same groups that gave buying opportunity,” he said. the credit crisis because, well, we While he wouldn’t say whether up on Cleveland are eager to come Cleveland rocks In other cases, companies are were wondering if Armageddon Nordson Corp. in Westlake is doing back, he said. Another manufacturing organiza- ramping up the purchasing they was going to happen,” he said. more buying, Jim Jaye, director of tion that has confirmed its coming to have previous authorization to make. “We were wondering, ‘Where is the communications and investor rela- Really big shows Cleveland with its trade show is the Parker Hannifin Corp. has accel- bottom, how far can this continue tions, noted the producer of auto- Ron Ashburn, executive director New York-based National Associa- erated its stock buyback, said Aidan to fall?’” Mr. Eisele said. “I don’t think mated dispensing equipment tends of the Pittsburgh-based Association tion for Surface Finishing. Sound like Gormley, director of corporate we have those concerns today. Our to be opportunistic when it believes for Iron and Steel Technology, said an esoteric gathering? Perhaps so, communications. The diversified belief is that the industrial economy its shares are undervalued, which he was so eager to see Cleveland but it’s a sizable one, nonetheless. manufacturer in June alone bought still has strength, still has room to he said they are now. update its facilities that he came to The group plans to take up to 600 hotel six million shares of the eight million grow, and we expect it to continue The Nordson board authorized Cleveland for the medical mart and rooms when it comes to town in June it purchased in its fiscal year that to grow. The real question now is: At in May a share repurchase program convention center’s groundbreaking 2014, Positively Cleveland reports. ended June 30 under an existing what rate will it continue to grow?” of up to 2 million shares because last January. While the convention center, the company had about reached the authorization. Sending a message “Absolutely,” he recalled. “We were medical mart and the area’s indus- According to Parker Hannifin buyback limit of a former autho- very pleased to see that shovel go trial base are big draws, comments chairman, CEO and president Don Local executives said they could rization, Mr. Jaye said. into the ground and the steel start to from those planning to hold shows Washkewicz, it was the largest not discuss very recent stock pur- “It’s a statement of confidence in go up.” here indicate Cleveland has made acquisition of shares in one month chases that haven’t been disclosed a company’s management team and Hosting a trade show for a group other bright moves in recent times in company history. During Parker’s publicly. (Companies generally report board, that the company has strong such as AISTech, as Mr. Ashburn’s that are boosting its attractiveness Aug. 2 conference call to discuss its buybacks in lump sums when prospects going forward,” Mr. Jaye organization is known, is no small as a convention center. earnings, Mr. Washkewicz said Parker announcing their quarterly results.) said of stock buybacks. “I think if thing. The group has about 15,000 They cite the entertainment- made the acquisition because “this However, over the last 18 months you’re seeing companies acceler- members in 73 different countries, related development of East Fourth company is so cheap, it is pathetic.” or so, companies in Northeast Ohio ate, they believe there’s upside.” and between 7,000 and 8,000 are Street and the Warehouse District and across the country have been Not everyone is high on buybacks, expected in 2015, when Mr. Ashburn as draws, along with the hotels, An eye on ‘downticks’ heavy buyers of their own shares, though. said he plans to hold the show in sports venues and the new casino Executives of Applied Industrial according to Elliott L. Schlang, Local investment professional Cleveland, which it last visited in that’s planned. Technologies, too, have acknowl- managing director of Great Lakes Michael McKeown says many 2006. The group requested 6,100 Mr. Ashburn said his iron and edged the Cleveland-based distrib- Review, a Shaker Heights institu- academic studies have shown that hotel rooms for its meeting, according steel group’s members, who last utor of bearings and industrial parts tional research boutique that, among companies are poor at timing stock to information from Mr. Julian. visited for a trade show in 2006, love will be inclined to buy back more other things, handles corporate buybacks, resulting in poor use of Likewise, the American Chemical coming to Cleveland, and so does stock than it has in recent quarters repurchase programs. excess capital for shareholders. Society’s Rubber Division also is he. The hotels, restaurants, night- considering the recent drop in Though Mr. Schlang thinks there Cash dividends often are the more coming back to town. It isn’t even clubs and tourist destinations are all stock price, said Mark O. Eisele, vice may be a slight slackening in repur- judicious use of cash, asserted Mr. waiting for the new convention center top-notch, he said, and members president, chief financial officer chases overall because so many McKeown, director of research for to open, though it is a big reason the want to come back. and treasurer. companies have been aggressive Aurum Wealth Management Group group is returning to Cleveland, Mr. Miller of the American The company’s share price, Mr. buyers and were burned by the recent in Mayfield Village. said executive director Ed Miller. Chemical Society’s Rubber Division Eisele noted, had fallen by early market drop, he sees many companies Nonetheless, if stock prices stay Mr. Miller said he’ll bring between agreed. August to its 52-week low of about continuing to be buyers, though at about current levels and business 6,000 and 7,000 attendees to the “People love Cleveland, especially $25 a share from a 52-week high of they may be acting more cautiously. confidence is improved, Mr. Schlang International Exposition Center in the international travelers,” he said. about $36. Mr. Schlang said the increased predicts there will be a renewed Brook Park this October, when the “The nightlife, the things to see, the The company, which has had its buyback activity is spurred by rash of corporate repurchases. Rubber Division holds its large culture, the restaurants — it’s just current authorization to repurchase falling stock prices and the huge Parker Hannifin’s Mr. Wash- trade show, which it stages every perfect.” shares in place since before the stashes of cash many companies have kewicz, for one, said during the Aug. other year. But the real driver and It’s still too early to say just how recession began, buys opportunis- built up. Fifteen of the 30 companies 2 conference call that the company ultimate goal is to get back down- many shows will be in town once tically when it sees perceived weak- Great Lakes Review covers, he noted, would remain active as a buyer of town, and the division plans to be the convention center opens. But so ness in its stock price, Mr. Eisele said. are sitting on piles of cash. its own shares if the price continues the first to hold its trade show in the far, Mr. Julian said, all signs indicate “We try to do what everybody else Buybacks are one way to deploy to drop. new convention center when it the increase in conventions will be does — buy on downticks,” he said. that money. Repurchases reduce a Mr. Schlang agrees with local opens in fall 2013. It last held a show significant — and support the view “There’s a good probability that we may company’s stock outstanding and executives that the buybacks are, here in 2007. that building the convention center use our remaining authorization.” thus boost earnings per share. by and large, a positive sign to “The biggest two reasons would be, was a good idea. As of June 30, that remaining Executives of the companies that investors. one, the fact that the rubber industry “Every other city in our competi- authorization allowed Applied to look to be buyers say their repur- “It’s an indication to the street still tends to concentrate around tion set has had a new convention repurchase 650,000 shares. chases assert such activity is a sign the company feels that their own the Midwest, even though it’s a center,” Mr. Julian said. “Now, If Applied buys back all it can, the of their strength. stock is very attractive,” he said. “I global industry,” Mr. Miller said. we’re the ones seeing a resurgence purchase would total about 230,000 “I believe it’s sending a positive like to see a company that puts its “The second is this new market in of activity because we’re getting a shares more than the company’s signal to the marketplace that the own money where its mouth is.” ■ health care. It’s concentrating around new facility.” ■ 20110822-NEWS--22-NAT-CCI-CL_-- 8/19/2011 2:13 PM Page 1

22 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM AUGUST 22 - 28, 2011

detailing a World War II B29 building and global leadership and serves on the firm’s board of BRIGHT SPOTS bomber that sits in a reconditioning development. directors. hangar where its war-torn wings are Mr. Eaton, a partner at consulting It’s not all bad out there. Here’s the Flight. under repair. firm Global Novations of Waltham, ■ Concord Technology Group latest installment of a weekly web fea- The Boeing 707-120 sits on a Mr. Koutavas and Detailed Xpress Mass., and son of the late Henry Eaton, has moved from Lake County to ture that highlights positive develop- tarmac at the museum’s Boeing specialize in customer car-specific Dix & Eaton’s co-owner, “has facili- a 3,000-square-foot office/ware- ments in the Northeast Ohio business Field, and since it’s Seattle, the detailing for high-end cars such as tated more than 500 workshops, house space in Valley View. community. plane absorbs a lot of rain. It was Lamborghinis, Rolls Royce, Spyker team workouts and one-on-one The IT services company on Sept. last detailed in 2008. The jet carried and Mercedes, though he said he coaching sessions for more than 100 22 will host a grand opening for ■ One of Nicko Koutavas’ presidents Eisenhower, Kennedy, also has found a niche with small clients in the Global 1000, across a vendors and customers at the new most recent jobs required Johnson and Nixon, according to aircraft and boats. broad range of industries, geogra- location, 6180 Halle Drive, Unit C. a presidential level of the museum. It remained in the phies and functions,” according to Concord Technology, founded in detail. presidential fleet, carrying the vice ■ Cleveland integrated commu- Dix & Eaton. 2008, bills itself as “a source for The owner of Detailed president and VIPs, until June 1996. nications firm Dix & Eaton said it His primary area of focus recently (customers’) hardware, software Xpress in Hudson was part Mr. Koutavas also was on the 10- has established a strategic partner- is on mergers and acquisitions, and support solutions on a wide of a 40-person team that last member Air Force One “finishing” ship with Dave Eaton, a global joint ventures and globalization range of networking, infrastructure month detailed a former Air Force team charged with looking for even consultant with more than 20 years efforts. and security products.” One presidential jet that’s now on small remaining blemishes. of experience in the areas of cultural Mr. Eaton was a Dix & Eaton Its president is Andrew Lingen- display at Seattle’s Museum of Also part of the project was integration, multinational team- account executive early in his career felter.

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AUGUST 22 - 28, 2011 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 23 THEINSIDER REPORTERS’ NOTEBOOK THEWEEK BEHIND THE NEWS WITH CRAIN’S WRITERS Look for him in the 2040 neur when he grows up. And he might end Financial Credit Union in Akron is partnering AUGUST 15 - 21 up inspiring others to follow his lead. with a nonprofit to offer a loan product. class of Forty Under 40 “My cousin, friend and sister are all thinking The 11-branch GenFed, in collaboration Around the Circle: Efforts to expand the ■ Connor Zamary could be Northeast of apps, too,” Connor said. — Chuck Soder with Greenleaf Family Center in Akron, on University Circle district of Cleveland beyond its Ohio’s Mark Zuckerberg. Aug. 1 initiated a program that will award health care and educational offerings with addi- Of course, we won’t know that for at least The Tribe attracts car loans of up to $4,000 to Summit County tional residential options are about to take a step another 10 to 15 years. a chatty bunch residents who do not qualify for traditional forward. WXZ/Hazel LLC, an affiliate of WXZ That’s because he’s 7. loans. The aim is to close at least two loans Development Inc. of Fairview Park, secured With help from his dad, Connor started ■ Want to get into the Cleveland Indians’ a month in the program’s first year. financing for a $10 million apartment develop- Toaster Pop LLC, a company named after a Social Suite, to which the team invites six Greenleaf, a provider of behavioral coun- ment it has planned with University Circle Inc., game it sells for $1 on the Apple App Store. influential social media users and guests for seling services, is guaranteeing the loans. the nonprofit managing the district’s develop- The game requires players to spread each home game? Sue Turns, who manages a GenFed ment, marketing and maintenance efforts. Jim butter, jam and other toppings on a Clear your schedule for 2012. branch in Akron and one in Fairlawn, had Wymer, WXZ president, said the developer plans piece of toast as fast as possible. Or maybe 2013. worked personally with Greenleaf on another to start construction soon and expects to hold a Connor thought of the idea Indians spokesman Curtis auto loan program called Ways to Work out ceremonial groundbreaking a few weeks after re- for the game, filled out the Danburg said the suite has a of Milwaukee. Now the nonprofit and the ceiving final building approvals. Plans call for the forms to start the company, waiting list of 600 people. Mr. credit union are going it alone. This way, 59-unit project to be completed by next June. created a PowerPoint presenta- Danburg said the allure of sitting clients can have direct contact with the local tion, made a pitch to investor Jeff in a suite has added to applica- lender, and Greenleaf no longer will pay and In the money: SironRX Therapeutics of Herrmann at the Youngstown Business tion numbers; last year, the Indians pass along to clients a $60 fee for each loan it Cleveland raised $3.4 million that it will use to Incubator and selected the California- introduced their “Tribe Social makes, said Bob Sukel, who manages Green- fund clinical trials that would test whether a based company that developed the app. He Deck,” constructed in front of the left- leaf’s financial services for families program. drug licensed by the company safely and effec- responds to business emails, too — using field bleachers. To avoid weather-related All program applicants have low income tively can treat post-surgical wounds. The his dad’s account. problems, though, the team moved the and/or spotty credit, Mr. Sukel said, but the investment was led by North Coast Angel Fund, Of course, Craig Zamary provided advice tweeters and Facebookers inside. program will take into account their ability a group of individual investors from throughout along the way — something he’s qualified to (Plus, they have plenty of suite space to repay. the area. Other investors included the Cleveland do in light of starting a few businesses him- available, as a cursory glance around the “It’s easy to find a reason not to do a Clinic, JumpStart Inc. of Cleveland, Fletcher self, including Youngstown-based Green ballpark on any game night would show.) loan,” Mr. Sukel said. “This committee looks Spaght Investments of Boston, Glengary LLC of Energy TV, which is like a “YouTube” for I sat there twice last year, including the for reasons to do it.” Beachwood, Ohio Tech Angel Fund III of videos related to environmental issues. He’s infamous debut of much-hyped Washington The program fits GenFed’s mission to Columbus, Early Stage Partners of Cleveland, X also an entrepreneur-in-residence at Kent Nationals pitcher Stephen Strasburg, when “always try to get to people who may be Gen Ltd. of Cleveland and several individuals. State University. that fancy boy complained about the pitcher’s underserved and aren’t traditional borrowers,” After already earning the distinction as mound. You’ll have to ask someone else Ms. Turns said. Opportunity knocks: Middlefield Banc the game’s high scorer (just ahead of his about the suite, though; my “application” The new program’s loan committee con- Corp. said Bank Opportunity Fund, an affiliate cousin), Connor’s next goal is to get a ver- was “lost.” — Joel Hammond sidered its first round of applications last week. of Hovde Private Equity Advisors LLC, agreed to sion developed for Android phones. They Seven applications were received, including buy $9.45 million of account for half the hits on the Toaster Pop Giving credit to those one from a woman who must enter her ve- the company’s com- website, so ignoring them would be “like hicle from the back seat, and another from mon stock in a deal throwing half of the money in the trash,” he said. who find credit tight a woman who must walk a mile home from that will give the in- Connor said he wants to be an entrepre- ■ In a first for the institution, GenFed a bus stop after dark. — Michelle Park vestor a large stake in the parent of Middlefield Bank- MILESTONE BEST OF THE BLOGS ing Co. Middlefield Banc said a stock THE COMPANY: Weatherchem, Excerpts from recent blog entries on mism? Check out an interview in The News purchase agreement provides for the sale of its Twinsburg CrainsCleveland.com Tribune of Tacoma, Wash., with Bruce common stock to Bank Opportunity Fund for McCain, chief investment strategist at Key- th $16 a share cash. Bank Opportunity Fund will THE OCCASION: Its 40 anniversary In Cleveland, at least, the Bank in Cleveland. own and control up to 24.9% of Middlefield check really is in the mail Despite the stock market’s recent wild Banc’s common stock outstanding after closing The maker of dispensing closures has put swings, Mr. McCain told the newspaper that ■ the sale of shares under the agreement. a lid on four decades in business. Congratulations, Cleveland-area residents he remains optimistic — at least for the Weatherchem got its start in 1971 when — you are doing a better job at paying your short term. Unless Europe implodes, Mr. Meet the new boss: Goodyear Tire & Rubber Albert J. Weatherhead bought Ankeny Co., a bills. McCain said, look for some good short-term Co. named Stephen R. McClellan, a 23-year small tooling business. Consumer products Consumer data firm Experian PLC released opportunities for investors. company veteran, as president of its North companies at the time were moving to adopt data on credit card delinquencies and mort- “Usually, oncoming recessions tend to American Tire business unit. Mr. McClellan, 45, plastic, rigid packaging containers, according gage payment behavior in the top 30 U.S. come as the economy gradually slows and succeeds Curt Andersson, who plans “to pursue to the company, and Mr. Weatherhead “real- markets. By both measures, Cleveland is at the market shows topping,” McCain said. other professional interests,” Goodyear said. The ized that Ankeny could make significant gains or near the top when it comes to timely pay- “We just haven’t seen the leading indicators Akron-based tiremaker said Mr. McClellan, who has in the packaging industry by developing and ment. of a recession.” been president of Goodyear’s North American manufacturing a value-added packaging Experian’s data show the Instead, he told the paper consumer tire business since August 2008, will product line, if it received the right attention percentage changes from the current turmoil is continue in that role until a successor is named. and capital investment.” 2007 (pre-recession) to June marked by the “anxieties With that formula, the 2011 in credit card payments created by the Washington Entering the Ice age: Schottenstein, Zox company now known as and mortgage payments that debacle.” Mr. McCain said and Dunn Co., a Columbus-based law firm with Weatherchem has become are 60 days late. citizens “have come to the an office in Cleveland, is about to be absorbed a global enterprise with On credit cards, Cleve- realization that there is a by Ice Miller LLP, a firm based in Indianapolis. 100 employees and a land ranked first nationwide major threat to their future Ice Miller said the combination will create a full range of dispensing with a 34.7% reduction in with the prospect of the regional firm of 314 lawyers with offices in closures used in markets the number of credit card federal deficit, and they from pet food to spices don’t have any faith that Indianapolis, Columbus, Chicago, Cleveland, Weatherhead payments that are two DuPage County, Ill., and Washington, D.C. The to household chemicals months past due. Other top markets for politicians can come together to solve it.” combined firm, which will operate as Ice Miller and candy. The company has customers in reducing credit card delinquencies: San As a result, people “have overreacted to LLP, will rank among the top 150 largest law North America, Europe, the Middle East and Antonio (a 30.5% decline), Cincinnati (30%), how much slowing there is.” He said he sees firms in the United States. Australia. Dallas (28.8%) and Houston (28.6%). Ohio “a chance for a rebound in the market.” Weatherchem says its products have and Texas must be doing something right. This and that: Specialty chemicals maker received a variety of awards, such as “Best Since 2007, about 20% fewer credit card Time is money, especially Lubrizol Corp. of Wickliffe pledged $1 million Package of the Year” from the Association payments nationwide are 60 days late. when it comes to jail time to the Cleveland Orchestra’s “Sound for the for Liquids and Sauces in both 2009 and The mortgage situation is worse in most ■ Centennial” campaign. The money is designat- 2010 for its LiquiFlapper closure. markets, though again, Cleveland bucks the Six states — including Ohio — reduced ed toward orchestra education and community The company also says it has undertaken trend. Nationwide, about 25% more con- incarceration rates by focusing on parole or programs. … Dinosaurs will make their way to “a long-standing and extensive sustainability sumers are paying their mortgage 60 days probation instead of prison time and have Cedar Point next summer. The Sandusky initiative” to reduce its own energy consump- late, Experian reports. But in Cleveland, the cut costs without increasing crime rates, amusement park said it will spend about $1 mil- tion. Even during the recent recession, number of late mortgage payers declined by according to a report from the American lion to install “Dinosaurs Alive! on Adventure Is- Weatherchem says it reduced scrap by 50%, 3.8%. Civil Liberties Union. land,” a prehistoric-themed attraction, for 2012. installing new hydraulic presses that con- Reuters said the report “highlights Texas, The park is sending the Paddlewheel Excursions sumed 35% to 45% less energy and using Despite Washington anxieties, Mississippi, Kansas, South Carolina, Ken- boat cruise up the river into retirement. 800,000 fewer gallons of water annually. tucky and Ohio as traditionally ‘tough-on- For information, visit www.Weatherchem. bank exec sees solid economy crime’ states that benefited from reducing com. ■ Need a shot of (relative) economic opti- incarceration rates.” 20110822-NEWS--24-NAT-CCI-CL_-- 8/18/2011 9:30 AM Page 1

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EXCEPTIONALLY EQUIPPED. TOTALLY IRRESISTIBLE. SEE JAGUAR CLEVELAND TO LEARN MORE ABOUT THE XF AND ITS BEST-IN-CLASS JAGUAR PLATINUM COVERAGE*.

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2006 - 2010 RANGE ROVER SPORTS LAND ROVER SOLON 6137 KRUSE DR., SOLON % APR* 6137 KRUSE DR., SOLON (440) 542-0601 Up to 24 months APR finance or 1-866-210-6707 www.jaguarcleveland.com 0.9 special lease rates now available www.landroversolon.com CLEVELAND LAND ROVER SOLON * Jaguar Platinum Coverage includes all factory recommended scheduled maintenance for 5 years or 50,000 miles, whichever occurs first. Wear and tear items are limited to brake pads, brake discs, brake fluid changes and wiper blade inserts based on factory specified wear limits or intervals. All work must be performed by an authorized Jaguar dealer. For complete details on Jaguar Platinum Coverage, including * Up to 24-month financing is available at 0.9% APR. Program valid through August 31st, 2011. Eligibility limited to Pre-Owned 2006-2010 warranty and maintenance coverage and exclusions, please visit your local Jaguar dealer. ** * With approved credit. 39 month lease. Total due at signing $4,795. Includes $4,196 down payment, $0 security de- model-year Land Rover Range Rover Sport vehicles.www.landroversolon.com Out-cycled service loaner vehicles are not eligible. Not all buyers will qualify for par- posit plus tax, title and fees extra. Customer responsible for excess wear and tear. 10,000 miles per year, 30¢ per mile over. Expires 8/31/11. Jaguar Platinum Coverage includes all factory recommended sched- ticipating lender’s financing. See Land Rover Solon for qualification requirements and complete details. ©2010 Jaguar Land Rover North uled maintenance for 5 years or 50,000 miles, whichever occurs first. Wear and tear items are limited to brake pads, brake discs, brake fluid changes and wiper blade inserts based on factory specified wear lim- America, LLC. its or intervals. All work must be performed by an authorized Jaguar dealer. For complete details on Jaguar Platinum Coverage, including warranty and maintenance coverage and exclusions, please visit your local Jaguar dealer.

6135 Kruse Dr. • Solon • (440) 542-0600 • www.DavisAutomotive.com