Office-using employment sectors have experienced modest employment expansion over the last year, recording an annualized net gain of 2,900 jobs across the metro. Employment gains were led by the professional and business services sector, which added 4,700 jobs year-over-year.

1. Office real estate implications
Sources: JLL Research, Bureau of Labor Statistics
Job growth/loss by sector (12-month change)
Cleveland
-1,400
-900
-500
-400
600
700
800
3,100
4,700
5,700
-3,000 -1,000 1,000 3,000 5,000 7,000
Trade, Transportation & Utilities
Financial Activities
Information
Government
Other Services
Educational & Health Services
Manufacturing
Mining, Logging & Construction
Professional & Business Services
Leisure & Hospitality
Number of Jobs
Rightsizing is top of mind for many of Cleveland’s office tenants. A move
towards open floor plans with numerous breakout rooms and collaboration
spaces is also a prevailing trend. As such, the market is seeing more
relocations than renewals. And landlords are providing competitive
improvement allowances for tenants to outfit their new space. Built-to-suit
activity is also on the rise. Companies such as Eaton, American Greetings and
Omnova have all gone this route. In this case, occupiers are able to start with
a blank canvas and create an environment tailored to their individual corporate
culture.
Tenants are demanding newer office product. Many are finding it difficult to
outfit aging offices with modern technology infrastructure and many older
offices do not sync with the sustainability initiatives of today’s corporates.
While tenants will pay a premium for new product, the benefits of large floor
plates, energy efficient offices and modern technology infrastructure outweigh
the rent premium in the eyes of most corporate occupiers.
Total jobs vs. unemployment rate
Cleveland
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
850,000
900,000
950,000
1,000,000
1,050,000
1,100,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Peak: 1,083,529 jobs
3.3%
unemployment rate
total jobs
-15.0
-10.0
-5.0
0.0
5.0
10.0
15.0
2010
2011
2012
2013
2014
Financial Activities Professional & Business Services Information Government
Office employment trends (12-month change)
Cleveland
Office employment update
Metro Cleveland . February 2015
6.0%Cleveland unemployment
1.2%Cleveland 12-month job growth
5.7%U.S. unemployment
2.3%U.S. 12-month job growth
• According to the most recent estimates from the BLS, total non-farm
employment in Cleveland stood at ~1.0 million payrolls, representing
an annualized increase of 12,400 jobs or 1.2 percent. Meanwhile,
unemployment decreased 100 basis points year-over-year to 6.0
percent.
• Office-using employment sectors have experienced modest
employment expansion over the last year, recording an annualized net
gain of 2,900 jobs across the metro. Employment gains were led by the
professional and business services sector, which added 4,700 jobs
year-over-year.
• Total U.S. nonfarm employment increased by 257,000 jobs in January,
and upward revisions were made to prior months totaling 147,000 jobs.
Gains in January were led by retailers, construction firms and health-
care companies.
• Meanwhile, the U.S. unemployment rate decreased 90 basis points
from the prior year to 5.7 percent, the fifth month in a row below 6.0
percent. Labor force participation ticked up slightly to 62.9 percent but
remains at its lowest level since 1978.

2. JLL Americas Research • Cleveland Office Employment Update 2
December 2012 December 2013 December 2014
Total Non-farm
Employment
1,031,500
1.7%
1,031,300
0.0%
1,043,700
1.2%
Unemployment Rate 7.0% 7.0% 6.0%
Cleveland Supersectors December 2012 December 2013 December 2014
Mining, Logging & Construction 33,900 -1.5% 33,900 0.0% 37,000 9.1%
Manufacturing 124,600 1.4% 124,500 -0.1% 125,300 0.6%
Trade, Transportation, & Utilities 187,100 1.4% 187,600 0.3% 186,200 -0.7%
Information 15,200 -1.9% 15,200 0.0% 14,700 -3.3%
Financial Activities 63,000 1.3% 62,500 -0.8% 61,600 -1.4%
Professional & Business Services 144,300 1.7% 145,800 1.0% 150,500 3.2%
Educational & Health Services 196,800 2.8% 198,200 0.7% 198,900 0.4%
Leisure & Hospitality 92,600 7.3% 89,800 -3.0% 95,500 6.3%
Other Services 39,800 -0.7% 40,000 0.5% 40,600 1.5%
Government 134,200 -0.9% 133,800 -0.3% 133,400 -0.3%
News on the street
Cleveland businesses expanding, contracting, etc.
Hartland & Company Ι Financial Consultant: Acquisition
Hartland & Company, a Cleveland-based institutional and private wealth advisory firm, recently announced its acquisition of Portland, Maine-based independent
wealth adviser Plimsoll Mark Capital. The transaction was completed on December 31. Financial terms of the deal were not disclosed. Hartland advises about 70
institutions and about 250 private families and individuals on roughly $15 billion in combined assets.
Hyland Software Ι Management Software: Expanding
Hyland Software, creator of OnBase, has embarked upon a hiring spree that could take its workforce past the 2,000 threshold this year. The private company, an
expert in workflow management, plans to hire 200 people in the coming months to meet growing demand for its products. Hyland currently employs about 1,800
people worldwide, including 1,400 at its campus off Clemons Road in Westlake, making it the largest software company in Greater Cleveland.
Oswald Companies Ι Investment Firms: Expanding
Cleveland-based Oswald Companies, an independent insurance brokerage firm, has opened two satellite offices in Toledo and Cincinnati and is engaged in talks for
acquisitions that could further expand its growing Midwest footprint. Oswald president David Jacobs said the company has seen organic growth of at least 10%
annually since about 2010.
Panther Premium Logistics Ι Logistics Services: Relocation
Panther Premium Logistics, a specialized freight carrier based in the Medina County community of Seville since 2004, has completed the move to its new corporate
headquarters and dispatch center in Sharon Township. The new facility, also in Medina County, has 50,000 square feet of office space and a 9,000-square-foot
service bay for applying decals and GPS units to trucks.
Signet Enterprises Ι Consulting Services: Expanding
Signet Enterprises, an Akron-based diversified financial investment enterprise, has launched its sixth company, Signet Capital Advisors, in downtown Cleveland.
The new company offers capital and business advisory solutions for middle-market companies, currently specializing in merger and acquisition advice, corporate
development, raising of capital, debt placement and valuation services
Summit Cleveland LP Ι Commercial Real Estate: Acquisition
Northeast Ohio's largest suburban office park changed hands recently in a $26.5 million transaction that brought new blood to the Cleveland commercial real estate
market. Summit Cleveland LP, Canadian investor group, bought Summit Office Park from Aegon, a lender that has owned the Independence properties since 2009.
The sale involved nearly 500,000 square feet of office space across four buildings in the Rockside Road submarket.
Employment statistics
Cleveland
Industry employment stratification
Cleveland
Educational &
Health Services,
198,900, 19%
Trade, Transportation
& Utilities,
186,200, 18%
Professional &
Business Services,
150,500, 14%
Government,
133,400, 13%
Manufacturing,
125,300 , 12%
Leisure & Hospitality,
95,500, 9%
Financial Activities,
61,600 , 6%
Other Services,
40,600, 4%
Mining, Logging &
Construction,
37,000, 4% Information,
14,700, 1%
Andrew Batson
Senior Research Analyst
Great Lakes Region
tel +1 216 937 4374
Andrew.Batson@am.jll.com
127 Public Square,
Suite 2410
Cleveland, OH 44114
www.jll.com/cleveland
Robert Kramp
Senior Vice President – Americas
Midwest & Great Lakes Research Director
tel +1 312 228 2470
Robert.Kramp@am.jll.com
200 East Randolph Street,
47th Floor
Chicago, IL 60601
www.us.joneslanglasalle.com/research
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