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SPECIAL REPORT: Northeast Ohio – Region on The Rise

Built on the rubber and tire industry, Greater Akron is expanding its economic base to include investment in medical devices, polymers and liquid crystal applications.

Built on the rubber and tire industry, Greater Akron is expanding its economic base to include investment in medical devices, polymers and liquid crystal applications.

By Tonya Porter
From the May/June 2012 issue

Northeast Ohio is a special place, with many opportunities for companies to grow and prosper, and many advantages for its residents to enjoy. More than 4.1 million people currently live in the region, at a cost of living that is up to 20 percent below the national average.

Northeast Ohio is strong in several key industries including polymers, liquid crystal displays, chemicals, bioscience, fuel cells, distribution and logistics.

The climate is right for business in Northeast Ohio. Supported by the State of Ohio’s new tax structure and millions of dollars invested in technology, education and workforce development, the Northeast Ohio region offers all the elements of success in today’s global marketplace. Ohio offers the third-lowest tax rate in the nation, according to a report released in April 2011 by Ernst & Young LLP and the Council On State Taxation (COST).

Historically a global leader in manufacturing, Northeast Ohio is transitioning to the 21st century knowledge economy. Access to markets is a key advantage of the area: The region is within a 500 mile radius of 41 percent of all U.S. households, 55 percent of all U.S. manufacturing facilities, 58 percent of the top 500 U.S. industrial headquarters, and 56 percent of the top 500 U.S. service corporate headquarters. Five major U.S. interstate highways intersect the area providing continuous roadways for the region’s numerous over-the-road freight companies.

Greater Akron: A Vertically Integrated Phenomenon

Greater Akron: a phenomenon, a distinct competitive advantage and a unique combination of strengths. A booming technology region nestled among more than 40,000 acres of Cuyahoga Valley National Park, with abundant resources for arts and recreation—Akron has what it takes to bring out the best in businesses and people alike.

The Greater Akron region, comprised of Summit, Portage and Medina counties, is rich in history, commerce, industry and culture. Greater Akron is home to more than 21,000 enterprises, including more than 150 Fortune 500 companies. In recent years, more than $2.5 billion in private capital has flowed into new plants and plant expansions, a testament to the value of the region’s economic and business climate in growing businesses.

Greater Akron is one of the few vertically integrated metropolitan areas in the country, which means that an idea can progress from inception to distribution using local resources exclusively. The region benefits from a unique ethos of collaboration. The city of Akron, Summit County, Portage County and the Greater Akron Chamber all work together to create opportunity in a cooperative spirit that does not exist in many other metropolitan areas. Rapidly growing science, medical and technical industries weave seamlessly into thousands of acres of park lands. Global business interests flourish alongside local businesses and leafy, tightly knit neighborhoods.

Akron has been ranked no. 2 among metros with populations of 200,000 to 1 million for new business expansions. Bridgestone Americas built a $100 million technical center adjacent to its Akron operations that will keep 1,000 employees in Akron. For more than 110 years, the world and North American headquarters of Goodyear Tire and Rubber Company has been located in Akron; now a $900 million development will be anchored by Goodyear’s new 450,000 square foot world headquarters and include ½ million square feet of office, retail and residential space.

Akron, in the heart of Summit County, is within a 500-mile radius of 42 major U.S. cities and encompasses 55% of all U.S. manufacturing plants, 57% of the U.S. population, 60% of America’s buying power, and 65% of Canada’s economic activity. The region has one of the largest concentrations of polymerrelated industries in the world, with more than 400 polymer related companies and close to 35,000 employees.

Akron is home to three of the region’s top medical centers and close to the world-renowned Cleveland Clinic. A public- and private-sector partnership in October 2008 launched the Austen BioInnovation Institute in Akron to capitalize on our city’s longstanding strengths in research, education and health care, with the goal of creating a nationally distinctive center of excellence for biomaterials and medicine.

Marking the region as a major educational center, more than 30 universities and colleges are within a 50-mile radius of Greater Akron. The University of Akron provides direct research education in the polymer industry and Kent State University’s Liquid Crystal Institute provides the most comprehensive research and education in the field of liquid crystal technology.

Akron is in the heart of Northeastern Ohio, a 4 million-population region that is home to major league sports in baseball, football and basketball and hosts a major pro golf event. It has Cuyahoga Valley National Park—Ohio’s only national park and one of the most visited parks in the National Park system—as well metro and state parks, the Ohio & Erie Canal Towpath Trail and Canalway National Heritage Area, and Blossom Music Center, summer home of the Cleveland Orchestra. NE Ohio offers such cultural treasures as the Rock and Roll Hall of Fame, renowned art museums and a host of performing arts venues.

You can tour local wineries, sample the creations of internationally renowned chefs, expand your mind at university and cultural programs, and soak up the vibrant and varied nightlife. Not far away are the serenity of Amish Country and the recreational treasures of the Lake Erie shores and islands.

The University of Akron and Kent State University have created redevelopment Master Plans and are implementing their plans around eclectic, historical neighborhoods full of living, dining and entertainment possibilities, to return the areas around the University of Akron and Kent State University to traditional urban neighborhoods where interesting people live, great ideas thrive and community matters.

Youngstown Drives Growth

When it comes to new project wins and garnering international recognition for its revitalization, the list continually gets longer and longer for the Youngstown-Warren area. For many years, the “Mahoning Valley” epitomized the negative perception of the Rust Belt. Now the area is the center point of the revitalized Cleveland-Pittsburgh TechBelt, and the world is noticing. The Youngstown/Warren Regional Chamber reports that since 2008, economic development projects announced have resulted in an impressive $1.5 billion in investment, with 5,256 new jobs created and 7,855 jobs retained.

What is driving this growth? Companies have recognized that the Mahoning Valley has the optimal combination of excellent logistical infrastructure, lower cost of establishing operations and skilled workforce, particularly in advanced manufacturing.

One example of this is the Valley’s position at the gateway to both the Marcellus and Utica shale plays. This has attracted considerable investment in supply chain activity. V&M and VAM USA, both subsidiaries of Vallourec, have announced investments totaling more than $700 million for new plants to produce tubes and couplings associated with shale drilling. TMK Ipsco, Exterran, De-Cal and Weatherford have all decided to locate shale operations here, while companies like Dearing Compressor & Pump, JMC’s Wheatland Tube and Valley Electrical Consolidated have all increased their existing footprint.

One of the key reasons why the Valley has been winning these projects is the region’s one-stop shop mentality for prospective companies. Sarah Boyarko, vice-president of Economic Development, Business Retention and Expansion for the Chamber, acts as the key liaison when site selection RFPs are introduced to the area. From there, she introduces companies to state and local officials to create incentive packages and to other agencies and port authorities that can provide bond financing, SBA loan programs and customized workforce development programs for interested companies. “All the key players in the Mahoning Valley recognize that making the client’s life easier as they select a location gives us a distinct advantage,” states Boyarko. “We give the client the tools and options for them to make informed decisions, and that practice has had demonstrable results.”

Cuyahoga Valley Industrial Center: Cleveland’s Gem

Located in the heart of Cleveland’s industrial valley, the Cuyahoga Valley Industrial Center (CVIC) is the largest manufacturing development opportunity in the City of Cleveland in the last 50 years. To put it in context, the last time there was a development opportunity of this magnitude within the city’s limits, Clevelanders were busy celebrating their last major sports championship.

Beyond its historical significance, what characteristics make this site appealing for end users and/or developers? This unique site represents the City of Cleveland’s only opportunity for a developer or end user to locate a new 750,000 square foot manufacturing facility that would support 750 to 1,000 new jobs. It also offers end users and/or developers four key advantages: strong community investment and support, a strategic location with unparalleled logistics and access and a skilled workforce, high capacity infrastructure and eager transaction partners.

While opportunities for greenfield development abound throughout Ohio, the CVIC site offers end users and/or developers the unique opportunity to return more than 60 acres of urban land to a productive economic use. This opportunity has not gone unnoticed by industry and political leadership in the state and region. As a demonstration of the site’s considerable economic potential, the State of Ohio Department of Development supported the site preparation with both a Job Ready Site and 629 Infrastructure grant. Additionally, the City of Cleveland has demonstrated its commitment to the redevelopment through both financing and legislative support. In fact, the site recently received recognition as the 2011 Industrial Transaction of the Year from the Northern Ohio Chapter of the National Association of Industrial and Office Properties (NAIOP).

Offering more than 60 acres of shovel-ready land, the site’s industrial use is consistent with the surrounding uses. It aligns with the City of Cleveland’s long-term vision for the area, and represents a significant industrial development opportunity without environmental concerns. Furthermore, the site is strategically located within three miles of the city’s core and has ¾ of a mile of highway frontage on Interstate 77 between the Pershing Avenue and Fleet Avenue exits. This highway exposure would undoubtedly benefit those industries that desire high visibility, such as consumer products, electronics, and medical device manufacturing. In addition to its location along a major interstate, it has onsite Class-1 short line rail via Wheeling & Lake Erie Railway, providing access to both Norfolk Southern and CSX networks. Finally, through its location at the Greater Cleveland region’s core, the site offers immediate accessibility to the region’s turnkey industrial workforce and provides an end user an unmatched opportunity to leverage the area’s surrounding industrial firms, transportation infrastructure and skilled workforce. In addition, the region’s workforce development programs have been instrumental in Ohio’s position as the leader in the U.S. manufacturing sector recovery. In Cleveland, they still know how to make things.

Beyond the site’s advantages of its favorable standing with local leadership and strategic location are the improvements already completed. The CVIC site offers an end user or developer high capacity onsite utilities and considerable road improvements. In compliance with the Ohio Job Ready Site and 629 Infrastructure grant, the site has been improved with direct connection to all utilities at high industrial capacities and provides connectivity to ArcelorMittal’s steel complex and both Heidtman Steel’s and Steel Warehouse’s recently developed operations. The site is well positioned to accommodate a link in the existing steel supply chain, as well as the potential to attract suppliers for alternative energy initiatives (including the steel component manufacturers supplying the current booming oil and gas activity in Ohio, Pennsylvania and West Virginia, wind turbine components, etc.) in need of direct input of steel materials and/or sea-based transportation (notwithstanding convenient rail and highway transportation) of supplies and products.

Additionally, the site is served by the following utilities and capacities:

  • Water: City of Cleveland Water Dept.—30-in. line, 70-80 lbs./sq. in.
  • Sewer: Northeast Ohio Sewer District–12-in. line, 1.1 to 1.6 million gallons/day
  • Electric: Cleveland Public Power—6 megawatts
  • Gas: Dominion East Ohio -20-in. line, 95 lbs./sq. inch

While the site’s three tangible benefits are clear, its fourth differentiator is equally critical to its development; the ease with which transaction partners can engage with local leadership. The site is owned by a nonprofit organization, the Greater Cleveland Community Improvement Corporation, which has a volunteer board of trustees comprised of three deeply experienced economic development professionals. The development team, Value Recovery Partners North Coast, is a joint venture of multi-disciplinary firms, including: Value Recovery Group, a government asset management firm based in Columbus, the state capital; Hull & Associates, a regional environmental engineering firm, headquartered in Ohio; and Allegro Realty Advisors, a global corporate real estate services firm headquartered in Cleveland. Based on the public financial partners, the ownership entity, and the project team, the site is positioned to receive meaningful attention and high priority cooperation from State, County, and municipal governments.

The team at Allegro Realty Advisors is well-versed on the site and eager to collaborate with a developer or end-user to develop the site, return it to an economically productive use, and extend the area’s rich manufacturing history into the future. For more information, contact Michael Cantor or Julia Iselin at 216-965-0630.

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