Greater University Circle Wealth Building Initiative

Daniel Budish Department of Economic Development City of Cleveland

University Circle

VACANT LAND University Circle Vacant Land

WATER SHUT OFFS / TAX DELIQUENCIES / FORECLOSURES

Water Shut Offs/Tax Delinquencies /Foreclosures

NEIGHBORHOODS AT RISK Overall Distress

Mission • The Greater University Circle Initiative

(GUCI) demonstrates how an older industrial city can build upon its assets to transform neighborhoods, create jobs, and address poverty. Transcending physical development to embrace a communal vision in which wealth is shared and no one is left out.

Timeline • 2003:

– Neighborhood Connections • 2005:

– Greater University Circle Initiative – Evergreen Cooperatives

• 2008: – RTA’s Healthline opens

• 2009: – New Bridge

• 2011: – MidTown Tech Park completed – Living Cities awards TII to Cleveland for GUCI – $14.75 million

in loans and grants

Euclid Ave. Streetscape and BRT

Timeline • 2003:

– Neighborhood Connections • 2005:

– Greater University Circle Initiative – Evergreen Cooperatives

• 2008: – RTA’s Healthline opens

• 2009: – New Bridge

• 2011: – MidTown Tech Park completed – Living Cities awards TII to Cleveland for GUCI – $14.75 million

in loans and grants

Challenges

• Geographical Fiefdoms • Organizational competition • Difficult to use $$ • Town-Gown Dynamics

Programs Goals Strategies Buy

Local Hire Local

Live Local

Connect Residents

Evergreen

Health Tech Corridor

Community Engagement

Programs Evergreen Cooperative Corporation

HTC Marketing & Attraction

Neighborhood Connections

Greater Circle Living

NewBridge

Towards Employment

Local First Cleveland (new buy local database)

Program Focus Areas

• “Self Help” – Local Procurement Database,

Supplier Attraction, Business Creation

• Careers, not Jobs – Evergreen Cooperatives – New Bridge

• Live and Work – Greater Circle Living – Evergreen Home Ownership

• Bridge the gap – Tenant Improvement Fund – ECDI – microlending – NDC - CDFI

Strategies • Anchor Leverage • 3rd Party Leadership • Common goals • Start with a “pilot” • Stacked costs • Adapt to changing needs • Stacked Roles

Focus Area: “Self Help” “We believe in what we call self-help, meaning if we are spending

money, we should be spending more locally.” Mayor Frank Jackson

Anchor Institutions spend over $3 Billion/year on goods and services

"You need to move into the city, or we will find somebody who will." Steve Standley, Chief Administrative Officer, University Hospitals

Programs: Local Procurement Database, Supplier Attraction, Business Creation

Business Creation Pipeline of home-grown companies that have their full life cycle in the Health Tech Corridor Spin-off idea from Anchor Incubator Space Post-incubator space Example:

Study by Angelou Economics identified a lack of tenant-ready space. Cited a solution as crucial to keep young, growing companies in the area. •Banks have preleasing requirements - won’t fund spec space •Tech companies are fast growing they cannot commit to prelease – they need space immediately •These companies are not credit worthy •Construction costs>Rents Solutions – tenant improvement fund, Public subsidies for core & shell

Business Creation: Challenges

EVERGREEN PRINCIPLES Co-ownership by co-op workers and other important

“stakeholders” Triple bottom line: community, environment, profit Great majority of our workforce hired from GUC

neighborhoods Linked to the supply chain of area anchor institutions Family supporting living wage & no-cost health care benefits Distribution of earnings into capital accounts (wealth

building) Career ladders for workers Corporate culture of ownership, participation, transparency

and accountability Individual co-ops are part of a larger structure that ties them

together into a coordinated and integrated network (ECC)

Strategies: Stacked Roles

The Funders The City of Cleveland The Cleveland Foundation Living Cities The Anchors Cuyahoga County

Community Engagement The CDCs (MidTown Cleveland, Inc., Fairfax,

University Circle Inc.) Neighborhood Progress Inc. Neighborhood Connections The Neighborhood Voice – Newspaper The Evergreen Cooperatives

The Anchors

Capital Attraction/Lending/Technical Assistance Jumpstart BioEnterprise Economic and Community Development Institute National Development Council

Stacked Capital • Multiple groups with resources

– The City (HUD 108, other loans and grants) – Cleveland Foundation – very well capitalized Foundation

(top 5 in country) – Living Cities - $14.75 million – Anchor partners – purchasing power + large capital

investments Everybody contribute to each initiative – smaller investments

for each organization Everybody gets credit for successes Promotes universal buy-in Example – The Evergreen Cooperatives

Evergreeen Funding Stack Source Use of Funding Total Funding

Contributed Evergreen Initiative* Evergreen Cooperative Development

Fund** The Cleveland Foundation $560,000 $3,000,000 $3,560,000 Living Cities (Year 1) $125,000 $150,000 $275,000 Case Western Reserve University $250,000 $250,000 Cleveland Clinic $250,000 $250,000 University Hospitals $250,000 $250,000 Higley Fund $50,000 $50,000 Kelvin and Eleanor Smith Foundation $1,000,000

$1,000,000

Minigowin Foundation $900,000 $900,000 Nathan Cummings Foundation $375,000 $375,000 Rockefeller Foundation $650,000 $650,000 Surdna Foundation $300,000 $300,000 Total $2,010,000 $5,850,000 $7,860,000

*The City of Cleveland has also provided $12.35 Million in loans and grants to the Evergreen businesses.

Strategy – 3rd Party Leadership

• Partnership with national Living Cities legitimizes local efforts

• The Cleveland Foundation can act as the great convener Significance: Focus of Resources – Cleveland Wards Bringing everybody (including competitors) to the

table

City of Cleveland Ward Map

**$65.7 million investment by the City into the HTC Since 2008

Outlook Positive • Investment in the Health Tech Corridor of $365,554,255 • Over 2 million square feet of space built or renovated • 2000 Jobs Retained • Over 400 jobs created to date • 7.6% Vacancy Rate in MidTown (Suburban Competitors

between 10% and 13%) • Over 400,000 square feet scheduled to open in 2013 • Over 80 high quality careers for Evergreen Employees • Over 100 people assisted through Greater Circle Living • Over 60 students in New Bridge – 21 placements so far

(some are still in school or have turned down offers)