CCLB 11-03-08 A 33 CCLB 10/31/2008 2:21 PM Page 1 NOVEMBER 3-9, 2008 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 33 Rysar: Company battered by competing glut of foreclosed properties continued from PAGE 3 Mr. Lurie said he hoped to work “We just built and sold homes. We’re being punished.” National and others pending against Cleveland. The bank seeks the 20- out a deal with Citizens Bank, but it him in Cuyahoga County Common acre Miles Drive-In site, where largely declined. – Ken Lurie, CEO, Rysar Properties Pleas Court and houses saddled with barren streets named after movie Citizens Bank spokesman Brian liens filed by unpaid subcontractors, stars sit in a subdivision known as Smith declined comment. He said Brad Sellers, Warrensville Heights Cinema Park’s homeowner prospects Mr. Lurie said he continues to believe Cinema Park, as compensation for a the bank never discusses relation- economic and community devel- went elsewhere. there is opportunity in the market. $3 million acquisition and construc- ships with its borrowers or pending opment director, said Citizens Starting over makes sense, Mr. He noted his Bluestone project in tion loan it provided to a Rysar-led litigation. Bank told him that it foreclosed to Sellers said, because he has seen Cleveland Heights is selling well. corporation, Cinema Park LLC. seize the site and satisfy the bad many prospective buyers stop at the Like most builders, each project is a The suit seeks to recoup a total of Out of the picture loan. That action would clear the closed model home over weekends. separate venture legally — the only $2.7 million spent under the loan Cinema Park was viewed as a way to sell lots on the site to new Mr. Sellers said he respects Mr. way developers can shield them- prior to June 17, when Citizens breath of fresh investment for builders at newer, lower costs than Lurie for sticking with Cinema Park. selves when the market sours or, as declared the loan in default. Warrensville Heights, providing a the prior loan allowed. “He did not fade into the wood- it has now, collapsed. Today, 15 homes stand on the long- chance for long-term residents to Mr. Sellers said he believes Mr. work,” Mr. Sellers said. “He’s been Mr. Lurie, an avid golfer, sees his empty site near Interstate 480, with stay in the suburb as they outgrew Lurie got bogged down because over there constantly all summer building business problems in such just seven owned by homeowners and its old, small bungalows. While he had too many homes and lots trying to salvage the deal.” terms, noting, “When I hit one out of the rest by Rysar — for now. Mr. Lurie available when the market soured. commercial development boomed Teeing it up again bounds, I tee it up again. I’ve never said he had pre-sales for as many as in the past decade in the largely Because he couldn’t keep subcon- walked off the golf course and I’m not 40 of the homes when he opened black suburb, new residential tractors at work when money ran out, Even with lawsuits by banks such going to do so now, even though I the project in 2006, but he lost those development languished. Mr. Lurie was unable to produce, and as National City Corp., Huntington can barely pay my (employees.)” ■ contracts when his buyers could not sell their existing homes. At Cinema Park and his other single-family projects, Mr. Lurie said he must sell $150,000 to $180,000 homes at a loss of more than $30,000 apiece. “When we have a buyer who can be financed, the appraisals are being cut, so it’s hard to get the values we need for the properties,” Mr. Lurie said. No bankruptcy here Filing for bankruptcy reorganiza- tion would look attractive to most business people in such a dilemma, especially as the housing slump has spawned a global credit crunch and a recessionary economy. However, Mr. Lurie vowed he will not file for reorganization. “I would like to quit, but this is the devil we know,” Mr. Lurie said. “We’ve lost a significant amount of money — in the millions. This gives banks another reason not to lend in the neighborhoods. Many bad loans were made. We just built and sold homes. We’re being punished.” Best known for building homes in tough inner-city neighborhoods in projects such as The Villages of Central near East 40th Street and Cedar Avenue in Cleveland, Mr. Lurie said he thought his business would outlast typical suburban builders because there is less competition in the city proper and he benefited from tax abatements and other city incentives. Instead, he wound up competing with the same glut of unsold homes and thousands of boarded-up fore- closed homes in city neighborhoods. CCLB 11-03-08 A 34 CCLB 10/29/2008 4:10 PM Page 1 34 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM NOVEMBER 3-9, 2008 NORTHEAST OHIO'S MOST AFFLUENT COMMUNITIES RANKED BY MEDIAN HOUSEHOLD INCOME (1) Projected Average Median population Education Housing units travel time Median household owner-occupied Number of growth to work Rank Community income housing value households Population 2008-2013 4 year % Post-Grad % Owner % Renter % (minutes) County 1 Hunting Valley $280,405 $1,130,597 272 695 (3.9) 38.3 34.9 85.3 14.7 26.5 Cuyahoga 2 Bentleyville $200,877 $598,901 279 896 (4.4) 39.9 37.2 97.9 2.1 27.8 Cuyahoga 3 Gates Mills $145,802 $501,974 855 2,286 (6.3) 29.6 37.1 92.9 7.1 31.3 Cuyahoga 4 Pepper Pike $140,424 $425,000 2,112 5,672 (4.7) 33.7 38.1 95.6 4.4 24.1 Cuyahoga 5 Sugar Bush Knolls $137,500 $277,193 105 290 11.4 28.2 35.9 98.1 1.9 26.9 Portage 6 Moreland Hills $120,911 $420,349 1,232 3,086 (5.1) 35.0 31.1 95.0 5.0 25.9 Cuyahoga 7 Kirtland Hills Village $119,231 $509,615 311 811 13.7 27.6 20.1 90.3 9.7 25.2 Lake 8 Hudson $108,481 $279,667 7,676 23,216 1.5 40.5 26.1 90.4 9.6 28.8 Summit 9 Waite Hill $106,522 $527,778 213 505 5.9 30.6 26.9 85.9 14.1 23.6 Lake 10 South Russell $101,042 $312,435 1,364 3,977 (0.5) 38.1 27.7 97.8 2.2 28.6 Geauga 11 Orange $100,726 $320,975 1,220 3,298 0.4 31.3 27.3 95.6 4.4 25.9 Cuyahoga 12 Bainbridge $92,520 $242,669 1,379 3,630 4.0 40.4 21.9 92.8 7.2 27.2 Geauga 13 Solon $91,841 $272,102 7,708 22,252 0.2 28.6 22.0 87.6 12.4 26.0 Cuyahoga 14 Boston Heights $91,616 $310,870 546 1,587 13.2 29.5 11.0 90.7 9.3 26.8 Summit 15 Highland Heights $88,647 $277,510 2,993 8,679 2.7 22.9 20.6 97.3 2.7 21.3 Cuyahoga 16 Brecksville $85,440 $262,046 4,992 12,994 (2.4) 25.2 22.3 88.3 11.7 27.2 Cuyahoga 17 Bratenahl $83,185 $246,124 694 1,275 (3.8) 28.0 35.7 84.7 15.3 21.2 Cuyahoga 18 Bay Village $80,190 $202,408 5,828 14,680 (6.6) 36.0 18.2 92.2 7.8 26.2 Cuyahoga 19 Aurora $79,138 $241,540 5,596 14,457 3.2 28.9 12.2 81.3 18.7 29.0 Portage 20 Macedonia $78,929 $196,830 3,872 10,589 6.7 23.2 7.4 95.5 4.5 25.3 Summit 21 Westfield Center $78,659 $209,333 449 1,140 4.6 34.3 13.0 90.7 9.3 24.7 Medina 22 Avon $78,131 $217,602 6,473 17,592 18.8 22.6 9.6 88.0 12.0 26.1 Lorain 23 Strongsville $77,494 $209,264 16,128 42,870 (2.4) 24.3 13.0 82.5 17.5 29.0 Cuyahoga 24 Silver Lake $77,259 $208,241 1,306 3,136 2.0 30.6 19.4 95.9 4.1 24.9 Summit 25 Richfield $76,473 $220,443 1,452 3,789 7.0 16.3 8.4 89.3 10.7 27.4 Summit 26 Valley View $76,436 $217,915 740 2,023 (5.6) 14.6 8.1 92.3 7.7 22.9 Cuyahoga 27 Peninsula $74,996 $253,030 274 663 3.3 21.3 17.9 78.5 21.5 25.6 Summit 28 Westlake $73,100 $228,974 12,663 30,781 (2.6) 27.5 17.9 75.8 24.2 26.6 Cuyahoga 29 Mayfield Village $72,735 $248,679 1,289 3,125 (6.9) 27.6 17.8 82.9 17.1 26.0 Cuyahoga 30 Avon Lake $72,702 $206,870 8,562 22,773 11.3 26.6 15.8 85.7 14.3 27.4 Lorain 31 Kirtland $72,625 $243,385 2,768 7,428 5.4 21.4 11.2 86.6 13.4 24.7 Lake 32 Chagrin Falls $71,980 $274,507 1,698 3,695 (6.3) 38.1 23.3 73.4 26.6 27.3 Cuyahoga 33 Fairlawn $71,453 $186,142 2,922 7,072 (2.4) 28.1 18.8 67.1 32.9 23.6 Summit 34 Twinsburg $70,258 $201,780 7,271 18,217 3.4 26.3 12.5 77.2 22.8 27.9 Summit 35 University Heights $69,807 $171,063 4,679 12,832 (6.6) 28.0 26.9 74.5 25.5 23.7 Cuyahoga 36 Shaker Heights $69,744 $220,175 11,160 26,676 (6.6) 25.8 35.4 65.6 34.4 25.3 Cuyahoga 37 Beachwood $69,433 $292,252 4,681 11,191 (5.4) 24.1 26.2 64.9 35.1 23.6 Cuyahoga 38 Canfield $69,167 $163,537 2,581 6,391 (8.1) 24.3 16.4 83.4 16.6 24.1 Mahoning 39 Independence $68,326 $238,213 2,601 6,816 (3.6) 18.2 10.8 94.4 5.6 23.6 Cuyahoga 40 Walton Hills $68,048 $225,118 885 2,300 (3.4) 14.4 5.0 97.0 3.1 26.8 Cuyahoga 41 Sheffield Village $67,425 $185,885 1,342 3,564 9.7 17.3 5.5 87.8 12.2 25.3 Lorain 42 Munroe Falls $66,648 $164,198 1,973 5,232 (1.0) 20.3 13.7 85.8 14.2 24.8 Summit 43 Broadview Heights $66,573 $218,293 7,250 17,892 4.9 23.8 13.1 76.1 23.9 27.7 Cuyahoga 44 Chesterland $65,512 $180,945 1,045 2,653 0.7 15.5 8.1 90.1 10.0 29.6 Geauga 45 North Royalton $65,136 $202,848 11,795 29,511 0.8 21.0 8.5 74.1 25.9 29.7 Cuyahoga 46 Olmsted Falls $64,879 $167,708 3,344 8,323 1.7 24.8 11.8 83.6 16.4 29.7 Cuyahoga 47 Stow $63,682 $170,295 13,402 34,449 3.4 24.4 12.7 71.3 28.7 25.9 Summit 48 Brunswick $63,318 $163,148 13,001 35,350 3.9 15.1 4.2 80.1 19.9 29.8 Medina Source: Information is supplied by the companies unless footnoted.