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CoreNet Global Real Estate CEU Course

Team NEO is a sales force for Northeast Ohio, attracting businesses worldwide to the Cleveland Plus region, advancing the region's economy through business attraction opportunities, and promoting regional teamwork.

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CoreNet Global Real Estate CEU Course

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  1. CoreNet GlobalReal Estate CEU Course Jim Robey, PhD Team NEO

  2. Regional Economic Development Who is Team NEO?

  3. Team NEO: The Region’s Sales Force Team NEO’s Mission Team NEO advances Northeast Ohio's economy by attracting businesses worldwide to the 16-county Cleveland Plus region. Team NEO’s Strategic Focus Generate Business Attraction Opportunities Execute with State and Communities to Close Deals Promote Regional Teamwork 3

  4. NEO Regional Economic Development System

  5. What Are the Economic Gurus Saying for 2011?

  6. What the Gurus say for GDP in 2011, or who is zooming who? • RSQE/Michigan: 2.1% (2.9 in 2012) • Kleinhenz and Associates: 2.9% • FRB Philadelphia (% of forecasters) • Negative growth: 3.9% • 0 to .9% 4.3% • 1.0 to 1.9% 12.2% • 2.0 to 2.9% 32.4% • 3.0 to 3.9% 28.3% 79.4% • >= 4.0% 18.7%

  7. Other Forecast Factors (US) • Inflation: 1.4% (‘11)—some energy basis • Real Disposable Income: • 2011: 1.5% • 2012: 1.7% • Light Vehicle Sales: returning markets • Annualized 2002 to 2007: ~17 million • 2009: 10.4 million (actual) • 2010: 11.5 million • 2011: 12.7 million • 2012: 14.8 million • T-bills: cheap money • 2011: .1% • 2012: .2%

  8. Optimism in Place? Source: Kleinhenz and Associates

  9. News of the Week • Precision Metal Forming Association: 15% of members have staff on layoff versus 85% in April 2009 (Crains) • NEOSA CIO Survey for 2011 (www.NEOSA.org) • 55% expect budget increases • 53% expect compensation to increase (44% no change) • 49% expect to increase head count • 3rd Quarter GDP growth (annualized) is estimated at 2.5% • October Statistics • US existing home sales: 4.43 million • US new home sales 283k (under expectations) • Durable goods orders: -3.3 • All factory orders: -.9% • Construction spending: .7% (consensus was -.4)

  10. More Recent News • November Statistics • Michigan Consumer Sentiment: 71.6 (up) • Consumer Confidence: 54.1 (up and above consensus) • US employment growth 39k (138k expected) • FOMC (economy.com) : • Fed funds rate: 00-.25 for “an extended period” • Low risk of inflation • Moody’s Survey of Business: • Global business in “funk” • Weak expect but continued growth

  11. Source: Moody’s Analytics 11

  12. Cleveland Plus Tracking Close to U.S. Rate Source: Ohio LMI

  13. 14

  14. A Slight Up Tick:Manufacturing Employment Source: BLS

  15. Access to Light Vehicles: 12+ Million

  16. United Airlines CEO Smisek says Cleveland must 'earn its hub status every day‘ Crains: 11-10-10

  17. Capital: Balancing the Costs for Energy

  18. Advanced Energy Portfolio Standard • At least 25% of supply for each Ohio utility must come from “advanced energy” sources by 2025 • At least ½ (12.5%) from renewable • At least ½ from inside Ohio • Requirements begin at end of 2009, ramp-up to 2025 • Alternative compliance payment if utilities fail to comply

  19. What is Advanced Energy? Wind Solar Storage Smart Grid Nukes Biomass E Transportation Energy Efficiency Clean Coal (carbon sequestration) Fuel Cells

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  21. Capacity Utilization in US End

  22. Source: CoStar

  23. Source: CoStar 24

  24. A Good Overbuilt Transportation Infrastructure Source: US Census Bureau

  25. US Forecast for Holiday Sales • National Retail Federation • 2010 • Up 2.3% from 2009 • Forecast at $447.1 Billion • 25 to 40% of all sales for some retailers are in this period • 2009 • Up .4% over 2008 • Total retail last Holiday season $437 Billion 26

  26. For the State of Ohio Source: US Census, Current Population Survey

  27. Need to Ramp Up: Population 25+ Educational Attainment Source: Claritas 29

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  30. Of 422 responses 32

  31. Labor Pool: Broad & Deep • 29 colleges and universities nourish talent pool • 175,000 students • 26,000 BA/BS degrees awarded annually 33

  32. Ned Hill: The Competitive Advantage of Northeast Ohio • Required areas of product improvement • Education & workforce (incumbent workers) • Entrepreneurial management • Workplace flexibility • Areas of demonstrated competitive competence • Headquarters, insurance, banking & health care • Materials production/fabrication • Chemistry • Industrial design • Secondarily: logistics

  33. What We are Working On • 71 Active Leads • 18 Advanced Energy Opportunities • 14 Manufacturing Facilities • 17 Bioscience Opportunities • 5 Manufacturing Facilities • Potential Investment: • Jobs: 10,420 • Payroll: $265,355,645 • Capital Investment: $1,549,854,268

  34. Factors Affecting Decisions • Energy Costs • Oil/Diesel: Deepwater Drilling? • Marcellous Shale: 50 Trillion FT3 potentially recoverable • Currency: is the US a good investment? • Near par with Canada • Weakening against the Euro (closer to low than high) • Losing strength against Pound • Weakening against Yen

  35. Additional Factors • Mid Term Elections • Federal: control of House and Senate • Ohio: Governor and Senate • Affecting: • State Deficit: estimated as high as $8.8 billion • Health Care • Tax Structure • Spending • Policies

  36. Thank you.Comments or Questions? Jim Robey, PhD VP for Research Team NEO www.clevelandplusbusiness.com jrobey@teamneo.org 216-363-5420 38

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