Crain's Detroit Business, Feb. 7, 2022 issue

THE CONVERSATION: Skillman Foundation CEO Angelique Power. PAGE 18

BRAND NEW BEAT Music startups still target hometown of Motown. PAGE 10

CRAINSDETROIT.COM I FEBRUARY 7, 2022

William Beaumont Hospital in Royal Oak

‘Dark days’ may be facing EV startup

Leaders’ abrupt departure raises questions

BY NICK MANES AND KURT NAGL

ANALYSIS

BEAUMONT’S PATH

FORWARD Now may be best opportunity for turnaround last two and half years — Grand Rapids’ Specand cost-cutting measures trum Health launched its were met with very public new integrated health sysangst among staffers and tem with Beaumont Health led to an exodus of valuable last week. physicians and high-value “Integrated” in the prespecialties. Beaumont’s atvious sentence is doing tempt to merge with Illisome heavy lifting. As of nois-based Advocate Auronow, administrators of the Dustin ra resulted in a vote of no new, temporarily named WALSH confidence of leadership BHSH Health say there from physicians and nurses will be no noticeable and, in the end, a shelving of the deal. changes for staff or patients.

The merger with Spectrum wasn’t But questions remain on how exactly Spectrum plans to turn around met with nearly as much animosity. the floundering Beaumont, which Many employees privately will tell has suffered serious damage to its you they viewed it as an appropriate reputation under outgoing CEO step to rid the hospital of Fox and his colleagues.

John Fox. In a statement to Crain’s, BHSH His merger attempts — three in the

President and CEO Tina Freese Decker said the relationship between staff and administrators is critical to the new leadership and she looks “forward to engaging with physicians, nurses and other clinical partners.”

There is also an open question of how much value the Beaumont name still has after several years of turmoil. Some say Spectrum would be prudent to rebrand the system once synonymous with the region’s top doctors — “Do you have a Beaumont doctor?”

If one is going to remake Beaumont, however, there might not ever be a better time than now.

See FORWARD on Page 17

The abrupt resignation of the two top executives at Electric Last Mile Solutions Inc. could spell “dark days” ahead for the newly public Troy-based electric vehicle company.

President and CEO James Taylor and Chairman Jason Luo, each co-founders of the electric commercial vehicles maker, stepped down after the company’s board determined they bought company equity without obtaining an independent valuation, according to a news release from the company late Tuesday.

News of the resignations also

Luo

Taylor

comes amid increased questions about EV companies like ELMS, which have predominantly gone public by merging with a socalled “blank check” company — formally known as special purpose acquisition companies, or SPACs See ELMS on Page 16

Index aims to measure Black Detroiters’ needs Effort to gather feedback gains steam

BY SHERRI WELCH

A yearlong formal effort to collect feedback on what Detroit’s Black residents need to thrive is taking shape.

The goal of the Detroit Thriving Index project is to inform development, city planning and philanthropy in the neighborhoods, said Lauren Hood, founder and director of Hood the Institute of AfroUrbanism, the newly formed nonprofit leading the research effort.

The project has attracted more than $500,000 in early support from

major foundations toward a $1 million goal to fund the study. It will seek feedback from Black residents in the 10 areas that are part of Detroit’s Strategic Neighborhood Fund, along with the North End, where there is also development happening and the John S. and James L. Knight Foundation is focusing grants.

“People are certainly on alert that things are happening in their neighborhood, and there’s outside interest,” Hood said.

See THRIVING on Page 16

NEWSPAPER

VOL. 38, NO. 5 l COPYRIGHT 2022 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED

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BIGGER PLANS

POLITICAL CASH

Museum buys property in expansion push PAGE 3

Who’s given what in the 2022 race for governor so far PAGE 13

2/4/2022 3:02:55 PM

NEED TO KNOW

DETROIT

THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT ` DEVOS BACKS PRIVATESCHOOL FUNDING INITIATIVE THE NEWS: Former Education Secretary Betsy DeVos on Wednesday backed a Michigan ballot drive to let students attend private schools and pay other educational expenses with accounts funded by donations that would qualify for tax deductions. Critics liken the proposed scholarship funds to vouchers and say they would be unconstitutional due to the state’s ban on public assistance for private schools. Contributions — for which corporate and individual donors would get an equivalent income tax credit — would go to scholarship-granting organizations and “never become state money,” DeVos said.

WHY IT MATTERS: The ballot drive is a new variation on a longtime battle in Michigan education funding. The group needs about 340,000 valid voter signatures to send each of two initiatives to the Republican-led Legislature.

` OMICRON COVID SURGE CONTINUES TO WANE THE NEWS: The fourth surge of the deadly coronavirus continues to recede in Michigan, but the number of deaths surpassed 30,000 last week.

The number of patients hospitalized with confirmed cases of COVID-19 was down more than 35 percent since the surge’s peak on Jan. 10.

WHY IT MATTERS: The numbers are moving in the right direction, and the experience in other places suggests that cases of the omicron variant could fall rapidly.

` JOHN JAMES TO RUN FOR U.S. HOUSE SEAT THE NEWS: After two failed bids for the U.S. Senate, Farmington Hills businessman John E. James Jr. is once again trying his hand at electoral politics. This time, he’s running for a U.S. House seat in the newly drawn 10th Congressional District in southern Macomb County and the Rochester and Rochester Hills corner of Oakland County. James, CEO of Renaissance Global Logistics, a subsidiary of Detroit-based James Group Inc., declared his candidacy for the open congressional seat Monday.

WHY IT MATTERS: The once-every-10years redistricting in Michigan is changing the political landscape in Michigan and opening new opportunities and challenges.

` FAURECIA WRAPS UP ACQUISITION OF HELLA THE NEWS: Faurecia has completed its acquisition of a controlling stake in lighting supplier Hella in a 5.3 billion euro ($5.95 billion) deal that is one of the biggest European automotive supply chain deals in the past three years. Faurecia will hold 79.5 percent of Hella, the Paris-based supplier said Monday.

WHY IT MATTERS: Both companies have major corporate centers in metro Detroit. Faurecia’s North American headquarters is in Auburn Hills; Hella’s U.S. headquarters is in Northville Township. Faurecia employed more than 3,700 people locally as of July.

Duggan pulls Mallett nomination ` Detroit Mayor Mike Duggan has withdrawn his nomination of Deputy Mayor Conrad Mallett for the city’s corporation counsel post.

Some Detroit City Council members disputed the choice in recent weeks, arguing that Mallett may be compromised in the role because of his close relationship to Duggan.

Mallett, a former chief justice of the Michigan Supreme Court who also previously worked with Duggan in the Detroit Medical Center health system, was nominated to replace Lawrence Garcia.

He left the job as Detroit’s top lawyer late last year for a job as senior counsel at Detroit-based Miller Canfield Paddock and Stone PLC. Garcia’s post has been filled for now on an interim basis by Deputy Corporation Counsel Chuck Raimi.

City Council’s internal operations committee decided Jan. 19 that it would not recommend that the full council approve Mallett’s nomination. The full council postponed a vote last Tuesday and a vote had been expected until the mayor pulled the nomination.

Mallett remains deputy mayor.

` HARBAUGH STICKS WITH UM AFTER NFL INTERVIEW THE NEWS: Jim Harbaugh will stay at Michigan after all, ending his dalliance with a return to the NFL after interviewing with the Minnesota Vikings for their head coach vacancy Wednesday. Harbaugh withdrew from consideration and will be back at his alma mater for an eighth season.

WHY IT MATTERS: Harbaugh told the Detroit Free Press that the lure of potentially winning a Super Bowl drew him to interview for the position, but said it’s the last time he’ll chase an NFL job.

After backlash Mayor Mike Duggan has withdrawn his nomination of Conrad Mallett, Detroit’s deputy mayor and a former chief justice of the Michigan Supreme Court, as Detroit’s corporation counsel. | CITY OF DETROIT VIA FLICKR

WANTED: THOSE LEADING THE CHARGE

IN THE EV INDUSTRY In a May 16 special section, Crain’s will salute business leaders supporting the EV industry by adopting, advocating for and implementing electric vehicles and EV platforms, converting fleets, conducting and contributing to research and more.

Visit crainsdetroit.com/ev-leaders today to nominate someone and learn more.

NOMINATIONS

CLOSE FEB. 25

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HEALTH CARE

DEVELOPMENT

Goodbill to help navigate hospital bills 1st goal to streamline at-home COVID-19 test reimbursement

ON THE TECH HUB TRACK

NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

BY DUSTIN WALSH

The state of Michigan has committed $126 million in new and existing programs to support the development of Ford’s Michigan Central tech campus in Detroit’s Corktown neighborhood.

Google joining Ford’s train station ‘ecosystem’; state commits new resources to Corktown

BY CHAD LIVENGOOD

Google is latching onto the mobility tech hub Ford Motor Co. is developing at Detroit’s long-abandoned train station in Corktown.

The Mountain View, Calif.-based tech giant and Dearborn-based global automaker are set to announce Friday that Google will provide its cloud-based technological services at Michigan Central, the new name for Ford’s mobility innovation campus centered on the old train depot, Michigan Central Station.

“When you get a partner like Google, it’s a game-changer,” Ford Executive Chairman Bill Ford Jr. said Friday morning during a news conference at the train station that’s still in the midst of a years-long rehabilitation project that’s expected to be complete by mid-2023.

Separately, Gov. Gretchen Whitmer’s administration has signed a memorandum of understanding with Ford committing $126 million in new and existing state resources toward infrastructure, housing and workforce training that supports Ford’s $950 million invest-

ment in the Corktown campus.

“We think this MOU is the recommitment and acceleration we need heading into this year to really begin to activate the (innovation) district,” Trevor Pawl, the state’s chief mobility officer, told Crain’s.

Ford officials have dubbed Google a “founding member” of Michigan Central and say the tech giant will be the first of several companies to join the “ecosystem” of firms populating the tech campus west of downtown Detroit.

See GOOGLE on Page 6

“WE FELT GOOGLE WAS A TERRIFIC PARTNER, IN PARTICULAR WITH SOME OF THE PROGRAMS THEY’RE LEADING.” — Mary Culler, development director for Michigan Central

Navigating insurers’ methods for getting reimbursed for at-home COVID-19 tests can be complicated.

It usually involves cutting bar codes off the box, filling out an online form, then printing that form and mailing it to the insurer.

Detroit entrepreneur Ian Sefferman and colleagues in Seattle have streamlined that process with a new website, called Goodbill.

The site, and eventually coor- Sefferman dinating mobile app, works by uploading your insurance card and the appropriate bar codes on the tests and automates the reimbursement process for the user.

But the prod- Haig uct isn’t really designed to only help with COVID testing reimbursement. Sefferman and his business partner Patrick Haig launched Goodbill in December with plans to capitalize on new federal regulations that forced hospitals to publish pricing data.

“We saw this (COVID-19 testing reimbursement) as a way for us to come on to the scene,” Haig said. “Our entire goal is to make consumer life easier in the health care system. There was a lot of confusion when the government (as part of an Obamacare mandate) ordered insurance providers to pay for testing. We realized we could use the product we already built.”

See GOODBILL on Page 15

NONPROFITS

Motown Museum doubles expansion plans with new building purchase

BY SHERRI WELCH AND KIRK PINHO

Motown Museum’s expansion plans have nearly doubled with the purchase of an additional building not far from its famous home.

The museum has acquired an office building about three-quarters of a mile away at 2550 W. Grand Blvd., west of Rosa Parks Boulevard.

Just shy of 36,000 square feet, the building sits on approximately 3.3 acres of land, according to CoStar Group Inc., a Washington, D.C.-based real estate information service. The land includes more than 195 gated parking spaces, and the building was constructed in 1968, according to CoStar.

It had been owned by an entity called 2550 West Grand Boulevard LLC, per Wayne County land records.

The Motown Museum has acquired an office building about three-quarters of a mile away at 2550 West Grand Blvd, west of Rosa Parks Blvd. | COSTAR GROUP INC.

That entity has the same mailing address as New York City-based Goldmont Realty Corp.

An email was sent to a Goldmont representative seeking comment and additional information.

Motown Museum acquired the property in anticipation of the needs for its expanded operations, parking and programmatic space, Chairwoman and CEO Robin Terry said in an emailed statement.

“Our board is evaluating the best uses for the building and will make a final determination in the coming months about its long-term plans,” she said.

The new site builds on the museum’s earlier plan to add 40,000 square feet to give it a 50,000-square-foot campus.

Motown Museum announced its expansion plans and a $50 million

campaign to fund them just more than five years ago. The four-phase project will add interactive exhibits, The Ford Motor Company Theater, recording studios, meeting spaces, a cafe and expanded retail and new programming space.

The first phase launched in September 2019 is still underway. As part of that, three historic homes adjacent to the Hitsville USA house are being renovated to create Hitsville Next, a creative hub for entrepreneurship and education programs.

Construction began in the fall on the second phase of the expansion, an outdoor plaza that will span the front of the new museum campus. It will include a new front for the expanded Motown Museum and a pop-up performance space for local talent.

The second phase, which will also include some work on the original FEBRUARY 7, 2022 | CRAIN’S DETROIT BUSINESS | 3

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The deadline for completed applications is March 4, 2022.

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REAL ESTATE INSIDER

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The Executive Office Plaza complex west of downtown has hit the market for sale after its longtime owner looks to cash out. | COSTAR GROUP INC.

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www.zhangfinancial.com 101 West Big Beaver Road, 14th Floor Troy, MI 48084 (248) 687-1258 Minimum Investment Requirement: $1,000,000 in Michigan $2,000,000 outside of Michigan.

Assets under custody of LPL Financial, TD Ameritrade, and Charles Schwab *As reported in Barron’s March 12, 2021. Rankings based on assets under management, revenue generated for the advisors’ firms, quality of practices, and other factors. **As reported in Forbes February 11, 2021 and August 16, 2021. The rankings, developed by Shook Research, are based on in-person and telephone due diligence meetings and a ranking algorithm for advisors who have a minimum of seven years of experience. Other factors include client retention, industry experience, compliance records, firm nominations, assets under management, revenue generated for their firms, and other factors.

See zhangfinancial.com/disclosure for full ranking criteria.

INDUSTRY ACHIEVERS ADVANCING THEIR CAREERS Recognize them in Crain’s

Listing opportunities: Debora Stein at dstein@crain.com

One of Detroit’s long-struggling high-rises hits the market One of Detroit’s long-struggling high-rise office complexes has been brought to market again seeking a buyer.

You may recognize the Detroit Kirk Office Plaza, PINHO sometimes referred to as the Executive Office Plaza, from scenes in the “Batman V. Superman” movie, a part of which I forced myself to watch last week in order to verify the following: There is a scene in the beginning of the movie which the complex is blown up.

Thankfully I didn’t have to sit through all three hours of it (directors cut). And thankfully, that was just some pretty fancy CGI. Anyway, the two-building complex at 1200 6th St. nestled on the skirts of downtown and Corktown has no published asking price, said Todd Szymczak, senior vice president of investment property sales for Southfield-based brokerage firm Farbman Group, which has the listing.

“They have gone back and forth whether they wanted to do the development or bring in investors or sell it outright,” Szymczak said of the ownership group. “They had different thoughts at different times but now is as good a time as any to go look for a new investment partner or sell outright, whatever brings the better value.”

The property was quietly shopped around a couple years ago after Ford Motor Co. announced that it was redeveloping Michigan Central Station into an autonomous and electric vehicle hub, but nothing came of that quiet effort by the Danou family to unload the asset, which it bought in May 2005 for just $6.3 million, or less than $10 per square foot.

The building is almost completely vacant across its 613,000 square feet — the 11-story south tower and the 21-story north tower, sitting on about two acres plus three consecutive blocks of parking that can be built

A former Catholic school has been turned into housing in a $7.2 million project. | COURTESY OF CINNAIRE SOLUTIONS

upon totaling about eight acres once Abbott Street is vacated, according to Szymczak. There is also a 13-story center core.

The site is being marketed as having potential for multifamily or hotel conversion or development, or a corporate office.

The property sits in an Opportunity Zone and had been occupied by the state of Michigan but was vacated more than a decade ago.

Former Catholic school turned into housing

Co. was the general contractor while Ferndale-based Fusco, Shaffer & Pappas Inc. was the architecture firm.

“Transfiguration Place Apartments exemplifies the meaningful impact that can be accomplished when partners come together to advance the social and economic well-being for Detroit families,” Christopher Laurent, president of Cinnaire Solutions, said in a press release.

“Access to affordable housing is a critical component of healthy communities, and our team is proud to be a part of this project that represents the best of what Detroit has to offer – partners joining forces to preserve historic structures while creating op-

A former Catholic school in Detroit’s Campau/Banglatown neighborhood has reopened as housing following a $7.2 million rede- “TRANSFIGURATION PLACE APARTMENTS velopment by Ethos Develop- EXEMPLIFIES THE MEANINGFUL IMPACT ment Partners THAT CAN BE ACCOMPLISHED WHEN and Cinnaire PARTNERS COME TOGETHER TO ADVANCE Solutions.

The Transfig- THE SOCIAL AND ECONOMIC WELL-BEING uration Place Apartments on FOR DETROIT FAMILIES.” Syracuse Street — Christopher Laurent, president,Cinnaire Solutions west of Mound Road and south of Davison now fea- portunities to empower families and tures 19 units spread across the lift up neighborhoods.”

21,500-square-foot building that was built in 1926.

Contact: kpinho@crain.com; Troy-based O’Brien Construction (313) 446-0412; @kirkpinhoCDB

4 | CRAIN’S DETROIT BUSINESS | FEBRUARY 7, 2022

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REAL ESTATE

Malcolm X's Inkster home listed on register of historic places Civil rights icon began his rise in Nation of Islam while living with his brother there

BY ARIELLE KASS

Aaron Sims was driving around Inkster with a friend, helping to cut grass during a period when the city couldn’t afford maintenance, and got to talking about Malcolm X. His elders had always talked about Malcolm X’s impact in the community, but Sims said it had never seemed likely that the civil rights icon had had much of a connection to Inkster.

So he and his friend went to Google and found the one place they thought would tell them for sure — Malcolm X’s FBI file.

There, on page 3, was an address: 4336 Williams St. Sims drove there. The house was in bad shape, but it was still standing.

“We were just like, ‘Wow,’” Sims said. “We got out of the car and sat on the porch.”

And Sims told his friend that they would own the place.

Now, 15 years later, Sims is the founder and CEO of Project We Hope Dream and Believe, and the house was listed Tuesday on the National Register of Historic Places. The distinction is a “validation” of the importance of the site, said Todd Walsh, the National Register coordinator for the state historic preservation office.

And Malcolm X didn’t just live in the house, which was owned by his brother, Wilford Little. It’s where he began his rise in the Nation of Islam.

“This was the place where Malcolm Little became Malcolm X,” Walsh said. “This is the point where all that happened.”

Sims’ organization has a $380,000 grant to restore the home, where Malcolm X lived 1952-53, from the National Park Service African American Civil Rights program. Sims said he has plans to turn the house into a museum, and intends to feature information about other notable Black Americans with connections to Inkster, including “Roots” author Alex Haley, NBC newscaster Lester Holt and baseball legend Hank Aaron.

He’d also like to build a community

African American civil rights leader Malcolm X lived in this house in Inkster with his brother and family from 1952 to 1953. | MICHIGAN ECONOMIC DEVELOPMENT CORP.

center on adjacent lots.

Getting the house recognized by the National Register of Historic Places can free up more money through tax credits for such projects and can bring more attention to the area, Walsh said.

Sims said he relishes the opportunity to tell a more complete story about Malcolm X’s life, and has been in touch with his daughter to help him do so.

“This is where the transformation began,” Sims said. “This is the most powerful part of his life.”

In Inkster, Sims said, Malcolm X became involved with Mosque Temple No. 1. He moved there after being released from prison in Massachusetts, and prayed with his family in rooms in the house that are still intact. While much is known about Malcolm X’s later years, before his 1965 assassination, Sims said there isn’t much recognition about the time he was a minister in Inkster.

“Now, we’re going to tell the story of the part that people leave out the most,” he said. “We have a chance to rewrite the history books.”

Walsh said few places Malcolm X lived are still standing, and the Inkster home is of particular importance because of its connection to his future work and identity. There are “big things” the house will be able to do, he said, given its history.

Sims said he hopes the rehabilitation will be finished by August, which is the month Malcolm X would have first moved to the city. The house needs a new roof, siding and drywall, Sims said, but the inside is largely intact. Sims said the home has been abandoned since the 1990s, and for a

period was on a list of homes due to be demolished by the city of Inkster.

He got control of it in 2017.

In addition to the work on the house, Wayne State University will be excavating the area around the house, looking for other clues about his life there.

“We’re still unraveling all the pieces,” Sims said. “I just feel like this is the jewel that we found. ... This is the most significant part.”

Contact: arielle.kass@crain.com; (313) 446-6774; @ArielleKassCDB

REAL ESTATE

Birmingham’s Daxton Hotel axes Aparium as operator Group had managed 151-room, $60 million development for less than a year

BY KIRK PINHO

Aparium Hotel Group is no longer managing the posh 151-room Daxton Hotel in downtown Birmingham.

The change in management comes less than a year after the $60 million development at South Old Woodward Avenue and Brown Street opened.

The change was first reported by Downtown Publications.

It’s not known precisely when or why the change took place, although the Birmingham City Commission last month approved a liquor license transfer from Chicago-based Aparium to Woodward Brown Ventures LLC, which is the hotel’s ownership group that is controlled by entrepreneur Mark Mitchell.

City Commission documents dated in November request the change and say management was being brought in-house.

The Daxton Hotel nixed its former operator, Aparium Hotel Group, after less than a year in business. | COSTAR GROUP INC.

As of August, Aparium still listed the Daxton on its list of hotels operated on its website, according to the website Wayback Machine, which helps chronicle updates in websites.

In a statement sent to Crain’s , the hotel said: “We are looking forward to our future as an independently owned and operated luxury hotel that is refining and redefining the art and science of luxury hospitality. We continue to elevate the guest experience through collaborations with like-minded brand partners and implement special touches that will set a new bar for high-end luxury hotels around the globe. Under the leadership of our newly appointed Managing Director, Raj Radke, we are refining our guest offering and implementing new luxury hospitality standards that our team is activating to make our service both memorable and outstanding as

Daxton enters a new chapter of its growing legacy.”

City Commission documents say the hotel has a liquor license for Madam, a 112-seat restaurant with 84 seats in the main dining area, 18 seats at the bar and 10 seats in a private dining room.

The Daxton Hotel’s arrival on the downtown Birmingham hotel scene pitted it squarely against the mainstay Townsend Hotel on Townsend Street, long a destination for professional athletes, entertainers and other celebrities staying in the region.

Aparium continues to manage the Detroit Foundation Hotel in downtown, which was developed in an old Detroit Fire Department station several years ago, according to the company’s website.

Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB FEBRUARY 7, 2022 | CRAIN’S DETROIT BUSINESS | 5

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DEVELOPMENT

Why Ford left its name out of firm tied to train station project Ford Motor Co. is creating a new subsidiary to market and manage its mobility tech hub in Detroit’s Corktown neighborhood to make the innovation district Ford “agnostic,” a company executive told Crain’s.

Ford has formed Michigan Central Innovation District LLC, which will manage how the Ford-owned Michigan Central Station and other buildings will be used for the development of autonomous vehicles and new mobility technologies, said Mary Culler, Ford’s development director of Michigan Central.

Culler said the new limited liability company was set up to “attract others to come” to the campus, which will be anchored by Detroit’s long-aban-

doned train station, the adjacent Book Depository building and a third new office building that’s in the planning stages.

“We set up an LLC so that the structure is more agnostic,” Culler told Crain’s. “For branding, we’re talking about it being more about the Michigan Central innovation mobility hub, because it’s more than just a (train) station.”

Culler said Michigan Central is designed to be a “30-acre network infrastructure with buildings” that’s “powered by Ford.”

Ford (NYSE: F) plans mobility technology testing on the grounds of the former train station as well as office space in the tower of the old depot, which opened in 1913 but has sat empty since 1988.

The Dearborn-based automaker purchased the train station building and other properties around Roosevelt Park in 2018 for $90 million from the Moroun family.

Ford has said it is spending $740 million to rehabilitate the train station and Book Depository buildings, which had suffered from years of abandonment and decay.

Overall, Ford officials have said the Michigan Central mobility district project is estimated to cost $950 million by the time the train station building opens at the end of the second quarter in 2023.

As part of a 35-year $104 million property tax break deal with the city, Ford has committed to having 2,500 of its employees work out of the Corktown campus and bringing an-

other 2,500 from suppliers, mobility startups and other companies focused on the development of autonomous and electric vehicles.

On Friday, Ford announced that tech giant Google will be a “founding partner” of Michigan Central, providing its Google Cloud services on the campus and launching a computer coding training course for high school students.

Ford officials have repeatedly said the train station is open to tech companies and possibly other OEMs. “It’s really important that this be an open platform, an agnostic platform, that people come and participate in,” said Culler, who also is chief of staff to Ford Executive Chairman Bill Ford Jr. and president of the Ford Fund. “So that’s why you’re seeing

the LLC and that general name.”

Bill Ford Jr., the great-grandson of company founder Henry Ford, has envisioned Michigan Central being about more than just an office setting for engineers, software developers and computer programmers from Ford and its partners, Culler said.

“They don’t view this as a real estate campus,” Culler said. “This is an ecosystem that’s really never been tried to have a platform that’s being created by Ford and Bill’s vision and opening it up to others to come in and participate and to really try to solve some of these big problems (in mobility). We know we can’t do it alone.”

Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood

Ford Motor Co. has said it is spending $740 million to rehabilitate the Michigan Central Station and Book Depository buildings in Detroit’s Corktown neighborhood, which had suffered from years of abandonment and decay.

GOOGLE

From Page 3

Google also will open a Code Next Lab at Michigan Central to teach computer science to high school students as a means of developing new talent that could work in the innovation district, said Mary Culler, a Ford executive who is development director for Michigan Central.

“We’ve been talking with (Google) about the importance of bringing the community into this program in the right way for, of course, job training and making sure that people are prepared for the next generation of jobs,” Culler said in an interview with Crain’s. “And we felt Google was a terrific partner, in particular with some of the programs they’re leading.”

Google’s computer-coding programs will be “a game-changer as we think about training the next generation of employees,” Culler said.

“This partnership will expand our work in Michigan and help a substantial number of people gain the skills and tools they need to succeed,” said Ruth Porat, senior vice president and CFO of Google’s parent company, Alphabet Inc. Porat said Friday that Google will offer computer science classes for high school students at the train station on weekends and after school on week days.

“By offering digital skills training, mentoring to high schoolers learning to code and Google Cloud technology for Michigan Central projects and research on the future of mobility, we look forward to contributing to Michigan Central’s mission and all it will accomplish,” Porat said.

Much of the training will be done virtually, Culler said, acknowledging that it’s unclear whether Google will need to lease space in the train station or an adjacent building on the campus.

Google has an existing Detroit office next to Little Caesars Arena in The District Detroit that it opened in November 2018.”Obviously, together, we’ll be working through the details,” said Culler, who also is president of the Ford Fund, the automaker’s philanthropic arm. “But, ideally, the concept is that as a founding partner, Google will bring that program to this broader public partnership program and this will be a really exciting job-training component to the broader ecosystem ... of the entire innovation district that we’re creating.”

Ford has said it is investing $950 million in the mobility innovation campus in Corktown, including $740 million alone for the rehabilitation of the 109-year-old train station building and the adjacent Book Depository building. A third new office building is being planned on vacant land across Vernor Highway from the train station.

“We’re very much in the process of transforming this (train station) from a national punchline to a national treasure,” Bill Ford Jr. said Friday.

The automaker has said it plans to base 2,500 of its employees who work in the research and development of autonomous and electric vehicle technologies across the Corktown campus. Ford plans to recruit suppliers, tech companies, mobility startups and possibly other automakers to bring an additional 2,500 workers to the campus, Culler said.

The City of Detroit recently signed an agreement with Ford to create a transportation innovation zone around the Michigan Central campus for the testing of self-driving vehicles and other new mobility technologies, Mayor Mike Duggan said Friday.

The designation will help cut down on red-tape for testing new inventions, Culler said.

“Every time an inventor has an idea on mobility, we are going to vet it and find the safest way and most prompt way for them to try it out,” Duggan said Friday at the train station press conference with Whitmer, Porat and Ford company officials.

“If you have an idea to change mobility in the world, this area right here on Michigan Avenue is where you can make your dreams come true,” Duggan added.

New state support Google’s partnership with Ford at Michigan Central comes on the heels of news earlier this week that Israeli startup Electreon is going to build the nation’s first in-road wireless EV charging system on a one-mile stretch of public road near the train station.

The inductive vehicle charging pilot, first announced by Gov. Gretchen Whitmer last year at the Motor Bella show in Pontiac, will be funded through $1.9 million from the Michigan Department of Transportation and an unspecified contribution from Electreon.

Through a memorandum of understanding, the state of Michigan has committed $126 million in new and existing programs to support the development of Michigan Central, Pawl said.

That state support includes workforce training, a $35 million reconstruction of Michigan Avenue through Corktown and $72 million from the Michigan State Housing Development Authority over the next three years for the construction of new affordable housing units in the neighborhood, Pawl said.

“This is truly a whole of government approach,” Pawl said.

Ford’s Corktown project “aligns perfectly” with the Whitmer administration’s efforts to have 60 percent of the state’s adults have a college degree or high-quality certificate by 2030, Pawl said.

LARRY PEPLIN FOR CRAIN’S DETROIT BUSINESS

BY CHAD LIVENGOOD

“We need to transition our workforce from internal combustion engine skill sets to software development skill sets, electric vehicle skill sets, autonomous vehicle skill sets,” Pawl said. “So we’re going to be working with some of the best and biggest companies in the world to design training programs that can help our local workforce transition.”

Within the $126 million, Pawl said, there will be new state assistance coming through the Michigan Strategic Fund that’s not yet been approved by the MSF board. Pawl said he could not elaborate.

State resources for the mobility innovation district will come from the Michigan Economic Development Corp., the Michigan Office of Future Mobility and Electrification, the Michigan Department of Labor and Economic Opportunity, the state Department of Environment, Great Lakes, and Energy and MDOT. “By embracing a whole-of-government approach in our collaboration with Michigan Central and the city of Detroit, we are writing the playbook for a new kind of partnership that keeps Michigan at the forefront of mobility for generations to come,” Whitmer said in a statement distributed by Ford.

— Crain’s Detroit Business reporter Kurt Nagl contributed to this report.

Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood

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AUTOMOTIVE MANUFACTURING

Stellantis imposes changes that could raise suppliers’ costs Purchase order terms for 2022 double down on ‘source of a lot of friction’ in supply chain

BY VINCE BOND JR. AND JOHN IRWIN | AUTOMOTIVE NEWS

Longer contracts?

Stellantis has made controversial changes to its purchase order terms and conditions for 2022 that can force North American suppliers to reduce prices whenever they achieve any cost savings and to remain locked into unfavorable contracts for as long the automaker wants.

Lawyers who have analyzed the new language say those are just some of the modifications that have raised concerns among suppliers they’ve been in contact with. They say some suppliers weren’t even aware that Stellantis had reworked the terms and conditions they’re required to follow.

The changes took effect Jan. 1, nearly a year after Stellantis was formed by the merger of Fiat Chrysler Automobiles and PSA Group of France.

A former Stellantis insider said the moves are driven by “unrealistic savings goals” sought by the automaker.

For suppliers that received “requests for proposals in December, we had heard that there were new terms and conditions being included, but there was not a real formal announcement that these terms were changing,” Vanessa Miller, a partner at Foley & Lardner LLP in Detroit, told Automotive News.

“That’s different than what we saw in 2021 with a couple of other OEMs that provided not just advance notice and a heads-up to the supply base, but they also provided a lot of lead time.”

Ford Motor Co., for example, delayed the effective date of new terms last year in response to feedback from the supply base, Miller said.

Miller and colleagues Nicholas Ellis, Regina Gilmour and Amir El-Aswad studied the updated Stellantis N.V. and FCA US LLC terms and as-

Miller said Stellantis has added provisions that expand its ability to prolong the life of a contract.

The Foley & Lardner analysis says the automaker now can unilaterally extend North American purchase orders across multiple vehicle programs and extend vehicle programs more than once. In addition, the terms say purchase order agreements that don’t specify an end date, or have an end date of “9999,” will last for the life of the vehicle program.

“The traditional model in the automotive industry is usually what’s called the life of the program term,” Ellis said. “The supplier has to supply the part for as long as that particular OEM program is in effect. That’s typically been a source of friction.

How long does that program really last for?

“But here, Stellantis really has added some language that goes much beyond the traditional model, allowing them to roll over the contract to new or successor programs or additional programs, potentially locking in the supplier for very long time if they have favorable pricing on the part.”

Auto suppliers typically avoid criticizing their customers publicly over such matters.

Some suppliers contacted by Automotive News said they’re studying the changes and did not want to comment. A spokesman for ZF said the transmission maker is “still reviewing these terms and working with Stellantis.”

An executive at one significant supplier to Stellantis said the updated terms and conditions make suppliers’ liability “potentially unlimited.” The executive requested anonymity due to the sensitive nature of the topic.

Stellantis has made controversial changes to its purchase order terms and conditions for 2022. | CRAIN’S DETROIT BUSINESS

sembled a list of suggestions for how suppliers can cope with the changes.

The lawyers said Stellantis altered the “direct materials” global terms and conditions that are common to suppliers in all regions, and an addendum called Exhibit A that covers North American suppliers.

The lawyers’ report says identifying the changes is only the first step.

Second is determining “whether these terms are acceptable for existing business or whether certain objections should be raised.”

Miller said the law firm has had “back-and-forth discussions” with about a dozen suppliers that reached out saying “they’re concerned about how this going to play out, and just wanting more clarity into what the practical implications are of these changes.”

Stellantis declined to comment.

Cost increases The attorneys said there’s now a

rule in place in North America that suppliers must immediately pass on cost savings they achieve to Stellantis. The automaker’s terms say suppliers also must provide a written plan for implementing cost savings and productivity improvements by Oct. 1 every year.

The firm said this creates a problem for suppliers because there’s no corresponding rule allowing a supplier to pass along cost increases to Stellantis. They’re expected to absorb unexpected costs while giving Stellantis the benefit of any savings they find.

“They expect their suppliers to absorb those hits,” Ellis said.

“That’s the source of a lot of friction in the supply chain these days.

Given the inflationary environment we’re in these days, and rather than trying to accommodate that, Stellantis essentially has kind of run in the opposite direction and doubled down on this idea that all of the risk of any cost increases remains on you.”

“Any supplier that signs up for this is basically at the stage where you cannot calculate the rate of return on your investment,” he said. “You have potentially unlimited liability on all kinds of different things, and you don’t know how much you’re going to make.”

The executive said the answer for suppliers frustrated with the changes is to not sign onto a new contract with Stellantis under the new terms and conditions.

“Either use the old T’s and C’s or not do business at all,” the executive said.

Stellantis could be at risk of losing future business from suppliers that are not dependent upon it to remain afloat financially, he said.

“We’re living in a world where we don’t have a great surplus of suppliers,” the executive said. “The suppliers that are in business are good, but they’re all challenged in terms of getting people to work, getting supplies and making a return. And the industry is trying to fill capacity. Demand is there, but we have production shortages. So, any supplier that has the ability to choose among customers is not going to do business with Stellantis.”

Low satisfaction A former Stellantis insider with knowledge of the automaker’s North American purchasing operations said the changes are the sort of behavior that shows why Stellantis and predecessor FCA consistently receive low scores in the annual Plante Moran supplier satisfaction survey.

The person said nearly half the staff in Stellantis’ purchasing department has left over the past two years, resulting in many company veterans being replaced by inexperienced new hires chasing “unrealistic savings goals.”

Philip Nussel contributed to this report.

REAL ESTATE

Tire Wholesalers to more than double size with large new building Company to move out of Troy HQ to site of former Detroit Artillery Armory in Oak Park

BY KIRK PINHO

Tire Wholesalers Inc. is expected to move out of its Troy headquarters into a new warehouse/distribution building more than double its current footprint under construction in Oak Park.

The company, based at 1783 14 Mile Road, is taking the entire 275,000-square-foot building underway on the former Detroit Artillery Armory site, expanding from 100,000-plus square feet on its current site.

Ross Kogel Jr., president of Tire Wholesalers, said the company moved into its existing space in 1992 and has added to it over the years.

The new building, at 15100 Eight Mile Road, is expected to be complete in December, giving the company more needed space and the ability to “optimize some technologies that allow us to operate even more efficiently than we do now.”

A rendering of a new building in Oak Park being built on the former Detroit Artillery Armory site. | COURTESY OF THE OPUS GROUP

Kogel declined to disclose Tire Wholesalers’ employee count and said no determinations have been made on new hiring at the new facility.

He also noted that the new building is located within a couple of blocks of the company’s first location, which was about 8,000 square

feet in 1970.

“We are really excited to do it,” Kogel said.

The developer of the new building, Minneapolis-based The Opus Group, is also the contractor and architect, according to a news release.

Questions were sent seeking information on the development cost and

whether any public incentives are involved.

The site is the former Detroit Artillery Armory property, which for years was considered a priority of Oak Park officials to redevelop into new uses.

The site, totaling about 100 acres, was unused since 2000 before Livonia-based Schostak Bros. & Co. purchased it for $3.7 million from the Michigan Department of Military and Veterans Affairs in 2003 and began selling it off to developers.

In 2015, Indianapolis-based developer Scannell Properties Inc. began developing a 300,000-square-foot facility for FedEx Corp. there on about 60 acres.

The property had included a 494,000-square-foot building that during World War II was a machine gun manufacturing plant, which has been demolished. The property was turned over to the Michigan National Guard after the war.

Until the early 1990s, the site was used for training and storage, then just for storage until 2000.

“To have the former Detroit Artillery Armory site fully leased and built out is a long-term dream I am beyond excited to see realized,” Oak Park City Manager Erik Tungate said in a release. “This will provide new job opportunities for our residents and an additional tax base for the City of Oak Park. Businesses that embrace advanced and modern technology and operational approaches are welcome in Oak Park, and this new development exemplifies what we look for as we continue to move down our path of excellence.”

The Royal Oak office of Chicago-based brokerage house JLL and Southfield-based Signature Associates Inc. worked on the land sale.

Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB FEBRUARY 7, 2022 | CRAIN’S DETROIT BUSINESS | 7

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CRAIN’S FORUM: LETTERS TO THE EDITOR

Your grandpa’s assembly line job isn’t coming back

SPECTRUM HEALTH/BEAUMONT HEALTH

TO THE EDITOR:

EDITORIAL

Beaumont-Spectrum: Details will matter G

etting a merger done between two of the biggest, most complex organizations in Michigan was a tall order.

But Beaumont Health and Spectrum Health, doing business for now under the somewhat inelegant name BHSH Health, has its biggest challenges still ahead.

As Dustin Walsh points out on Page 1, Beaumont needs to rehabilitate a brand name that has taken a beating during years of failed mergers and staff cuts.

But reputation isn’t the most important thing — the reality of health care for millions of people is at stake.

Combining health systems, with their complicated IT systems, 24/7 operations and byzantine politics, is notoriously REPUTATION Beaumont ISN’T THE MOST difficult.

Health itself was created from a threeIMPORTANT way merger with the THING — THE Oakwood and Botsford health systems REALITY OF in 2014. Work to inteHEALTH CARE grate those organizations went on for FOR MILLIONS years. Some say it OF PEOPLE IS AT was never really done.

STAKE. Spectrum has an advantage here — the Grand Rapids-based system was created from a combination of separate hospital organizations and has grown by adding hospitals throughout the state. There’s something to be said for experience, and we hope that experience helps smooth the path for integration.

The departure of controversial Beaumont CEO John Fox offers the systems an oppor-

tunity to smooth over staff relations. Whether he’s seen as a hard-nosed advocate for efficiency and a dealmaker or a ruthless cost-cutter who sacrificed quality, Fox was undeniably a flashpoint for staff anger. Easing some of the internal rancor can’t help but improve care quality.

One continuing concern: In the course of pitching the merits of the merger, the systems’ executives said the combination could cut costs. Some critics said that was unlikely, pointing to Spectrum rates that were higher than Beaumont’s and those throughout Southeast Michigan.

Reducing competition is seldom good for price or quality. We’ll have our first indication of what effect the merger might have on July 1, when insurers have to report what they pay per hospital. Those reports and hospitals’ self-reported rates should get more than a passing glance but should provide much-needed transparency on how real-world hospital costs compare.

This combined organization is now one of the most powerful and influential in the state, and it’s not hyperbole to say the merger affects everyone here in some way. The state needs it to succeed and pay off on the promises.

So we wish the combined BHSH wisdom, stability and a touch of luck in making this combination work for all of Michigan. (But let’s do something about that name, OK?)

A quick note to say that your article Jan. 28 article “Why Ford’s Corktown project may mean more to Michigan’s future than the next battery plant” on Michigan’s chase for obsolescence is the most important article I’ve read in Crain’s in years.

We need a change in world view that I feel utterly powerless to influence — which is why, as somebody with no platform, I appreciated your piece.

I’m endlessly dumbfounded by the belief that your grandpa’s job is coming back to build your future.

Meanwhile, as TechTown Detroit’s Ned Staebler said: “You go to Colorado, and they get it.”

My particular lens (and audience-less contributions) for this is architecture/urbanism, environmental conservation and connectivity to global capitals.

Those who I’ve met in Detroit and around Michigan who moved there from much sexier places love it — but only once they get there. To everyone who doesn’t know, it’s a gray, littered expanse of strip malls, polluted rivers and perceived isolation.

As America’s garage, Detroit should be its Berlin for sustainable urbanism, Copenhagen for conservation and Warsaw for global connectivity.

Instead, we keep aspiring to be Toledo or Terre Haute.

Patrick Stowe Jones East Lansing

Policymakers need to step up to future TO THE EDITOR: I enjoyed reading Chad Livengood’s article about the importance of Ford’s Corktown project and key elements that policymakers are missing to grow the knowledge base in Michigan.

Having been born and raised in Texas, I moved to Michigan in the blizzard of 1978.

Soon after, I became a single parent with two young daughters and enrolled at Wayne State University to earn an advanced degree — all paid for by my Japanese employer, an automotive and robotics supplier.

I stayed in Michigan because of outstanding institutions of higher learning, excellent health care systems, assurances of being able to receive and collect child support — and great neighbors.

It is true that Texas is a more business-friendly state (no state income taxes) with wide open spaces, and it is understandable the state has become a headquarters

hub for major corporations.

On a recent road trip across Texas, I overheard a local say, “We don’t want any of those liberals moving in.”

Well, I happen to know several who have already moved in.

Not me, I am staying in Michigan and am proud to advocate for policymakers to invest in their people here to help us become a knowledge-based mecca.

I am proud to be a past chair of the Henry Ford College Foundation and of the Dearborn Rotary Foundation. Both award hundreds of thousands of dollars in college scholarships annually to graduating high school seniors and others working to continue their education. We can do more for the good people of Michigan.

Time for policymakers to step up.

Margaret Blohm Canton See LETTERS on Page 9

MORE ON WJR ` Crain’s Executive Editor Kelley Root and Managing Editor Michael Lee talk about the week’s stories every Monday morning at 6:15 a.m. Mondays on WJR 760 AM’s Paul W. Smith Show.

Ford Motor Co. is spending $740 million renovating Michigan Central Station in Corktown to make Detroit’s old train station the centerpiece of a mobility innovation campus for 2,500 Ford employees and 2,500 workers from other mobility businesss. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited for length or clarity. Send letters to Crain’s Detroit Business, 1155 Gratiot Ave, Detroit, MI 48207, or email crainsdetroit@crain.com.

Please include your complete name, city from which you are writing and a phone number for fact-checking purposes.

Sound off: Crain’s considers longer opinion pieces from guest writers on issues of interest to business readers. Email ideas to Managing Editor Michael Lee at malee@crain.com.

8 | CRAIN’S DETROIT BUSINESS | FEBRUARY 7, 2022

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LETTERS

From Page 8

Education: Detroit’s pathway to mobility TO THE EDITOR: Ford’s investment in Corktown, along with GM’s promise of new investment here in our region should be lauded.

As with many Detroiters, my grandparents came here in the beginning of the last century for $5-a-day in the automotive industry, as cars became affordable to the masses. These wages were life-changing for my grandfather John, who left his parents’ coal company-owned shack in Ohio, bringing his new wife Vicki along in his Model A with the promise of a different future, pointed toward Detroit as if it were a manufacturing Mecca.

Soon enough, my grandparents saved enough for their first house. So it was with countless others — as Detroit transformed into the Motor City, putting people on the move, and creating unprecedented upward mobility as well.

This transformation created a pathway for millions. And just as my grandfather sought to improve his station in life, my father and his generation continued the move by seeking even greater fortunes beyond the assembly line.

Wealth-building happens over generations, with a gradual rise from low-paying unskilled jobs to those requiring more education and training.

Upskilling our current workforce not only requires the investments Ford is making in knowledge workers, but the production jobs GM and Stellantis are creating, as the industry transforms itself with self-mobility and electrification. These jobs hoist people onto that first rung on the ladder toward upward mobility. We should be investing in both.

My grandma Vicki would implore us, “Go get an education!” She didn’t want us coming home in soiled factory clothes as she and my grandfather did. And education is the ultimate game changer.

Our region also needs bold investments in education to lead the next generation to build upon the destination for advanced manufacturing into the future.

Ron J. Stefanski Detroit

General Motors Co. plans to invest $4 billion to add 3 million square feet of manufacturing space to its Orion Assembly plant on Giddings Road in Orion Township for the assembly of full-size electric pickup trucks. | JOHN F. MARTIN FOR GENERAL MOTORS

Workz, I recruited non-traditional learners with the ability to think in steps. I translate that thinking into steps into programming languages — Cisco IOS, Python, Linux.

Joyously, 30 percent of our learners, mainly African Americans, are earning more than $100,000 annually, as network automation or network security engineers.

They possess a Cisco certification and not a tech bachelor’s degree.

Michigan’s factories need these people to speed up the electrification of autos.

I postulate if invention and algorithmic thinking replaced algebra and bachelor’s degrees as job requirements, our tech workforce would grow exponentially, especially within Detroit.

Automation Workz is in the process of converting an admission workshop into a tech readiness assessment app to determine which learner has both invention and algorithmic thinking.

Don’t take my word for it.

Study the history of Silicon Valley.

You will see leaders invested into design and tech bootcamps to teach algorithmic and invention thinking to everyone, to build the talent base we rival and desire. If given the opportunity, I could return Detroit to its tech invention soul.

Ida Byrd-Hill CEO and founder Automation Workz

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A man-made talent shortage TO THE EDITOR:

Michigan leaders get more excited about a battery plant than an R&D facility, like the Ford Michigan Central Station, as the plant will hire more natives at $27 per hour, higher than $15 per hour that hospitality jobs pay.

Leaders have created their own talent shortage as they believe the false premise everyone needs to master algebra and possess a bachelor’s degree to be employed in tech.

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FEBRUARY 7, 2022 | CRAIN’S DETROIT BUSINESS | 9

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PHOTOS BY NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

ENTREPRENEURSHIP

Owner Roula David poses for a portrait on Jan. 28 inside Spot Lite in Detroit. David is a huge proponent of the city’s music scene and sees great opportunity for entrepreneurs looking to break into the business.

For music entrepreneurs, DETROIT IS FERTILE SOIL

Andrès Live performs a sound check on Jan. 28 at Spot Lite in Detroit.

J

BY JAY DAVIS

ust getting the doors of Spot Lite Detroit open cost venue founder and owner Roula David about $550,000.

David has been part of the city’s arts and entertainment scene since coming to the city in 2011. She said the east side cafe, bar, gallery, record store and music venue would not have been possible without various resources available to Detroit entrepreneurs.

“Those resources are essential,” said David, who opened the 5,000-square-foot entertainment spot last spring.

“No (traditional) bank is Peters going to give you money.

It’s all community lenders. Mind you, the loans are high interest, but the risk for the lenders is high, too, if the business fails and you can’t pay it back. With the pandemic, our lender gave us interest-only leniency. No other bank was going to do that. Without the community lenders and other resources, this would not have been possible.”

The Detroit Development Fund aided Roula's entrepreneurial ef-

forts with a $264,000 loan. ProsperUS Detroit and Michigan Women Forward loaned David $50,000 each. And in 2018, David won a $40,000 Motor City Match cash grant.

David is one of many who believe the city is ripe for entrepreneurs either already in or looking for a way into the music industry.

Detroit is nearly unrivaled as a music town, at least when you count its contributions to musical history, from jazz, soul and Motown to punk, techno, garage rock and beyond. Although the business is changing, there’s still plenty of opportunity — and increasingly, targeted resources — for artists, label owners and other cultural entrepreneurs to thrive in Detroit’s rich musical soil.

Learning the ropes Jeremy Peters, assistant professor of music business and entrepreneurship at Wayne State University and the co-founder of Ann Arbor-based Quite Scientific Records, is deep in the music entrepreneurship game.

10 | CRAIN’S DETROIT BUSINESS | FEBRUARY 7, 2022

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Peters, a voting member of the National Academy of Recording Arts and Sciences, is also a member of the U.S. Association for Small Business and Entrepreneurship. He pointed out that the music industry has evolved over the last decade, with streaming platforms changing not only the way artists are compensated, but how creative projects are presented.

“Things are definitely more centered around the experience a consumer has,” Peters said. “Something like a live show, a sponsored event with a lot of artistry and creativity plays a big role. Third Man Records right off (Cass Avenue) is an experience. You walk into the store and its not just about the recordings. It’s a whole world (company owner) Jack White has put together.”

Wayne State’s music business curriculum offers a formal education option for aspiring music entrepreneurs. The program readies students to work in various professions in the music industry, including arts administration, the recording industry, entertainment law, music publishing, the digital music industry, and public relations and marketing. The bachelor's degree program covers areas such as accounting, marketing and basic music technology.

The Detroit Institute of Music Education also offers a bachelor’s of arts program. Current courses, according to the school’s website, focus on home recording, music industry income streams and essentials of music theory. DIME also offers courses on commercial music performance and commercial songwriting. Degrees are granted through a partnership with Oakland University.

Detroit is also home to a growing number of incubators that give emerging artists hands-on experience, support and chances to earn their chops.

Take Assemble Sound. Last month, the Corktown-based artist development, management and studio company announced a partnership with Atlantic Records. That partnership will pay dividends for Assemble artists, said co-owner and general manager Garret Koehler.

“From our free studio residency program to our Riley free panel series, Assemble has demonstrated a willingness to assist upcoming artists however we can,” said Koehler, who founded the company in 2015 with partners Seth Anderson, Nicole Churchill and Tifani Sadek with $14,000 of their personal savings and a $6,000 loan. Assemble later Pope received a $100,000 Motor City Match cash grant award. “Our Atlantic partnership gives us access to a new set of inputs, specifically capital, infrastructure and knowledge for artists and their businesses.”

Resources in 'music mecca' Detroit Arts, Culture and Entrepreneurship Director Rochelle Riley, whose office was established nearly three years ago, believes there are limitless opportunities in Detroit for music creatives.

“Artists are small businesses, whether they’re gig musicians, dancers, designers, actors, storytellers, set designers, puppeteers or any other creative,” Riley said. “My of-

Owner Roula David has a drink with patrons at Spot Lite on Jan. 28 in Detroit. David is one of the city’s latest generation of music entrepreneurs, having opened entertainment and recording venue Spot Lite last year. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

fice’s mission is to invest in and support our creative workforce and provide opportunities for artists to improve their ability to thrive, to be successful businesses.”

The city offers music entrepreneurs in particular the chance to build their businesses in a city with an almost unparalleled musical heritage, Riley said.

“Detroit has always been a music mecca with recording studios, community and professional theaters and opportunities to rub shoulders with some of the best in several genres,” she said.

Through July, Detroit ACE is collaborating with Southfield-based Art Ops to offer business and financial management workshop series for Detroit creatives to improve their chances for success.

Through the courses, artists learn to market themselves online, create invoice systems and navigate copyright and trademark regulations, for example.

In December, ACE and the city procurement office hosted the city’s first artist vendor fair, allowing artists from several genres to sign up as city contractors.

Once signed up, the contractors are alerted when the city issues a request for proposal that fits their interests.

Close to 40 artists have completed the process, with more than 100 working to join the list, Riley said.

“That could be a game-changer as far as work goes,” she said.

Big-time push What could also be a game changer is the introduction of an entrepreneurial venture led by a music industry veteran.

training. Another may already have great music, but need some marketing.”

The city’s music scene has a storied history, but Pope sees potential for the future. Upon connecting with other creatives, the longtime producer said he sees Detroit artists excited about WRKSHP. “That excitement is inspiring. It’s infectious,” he said. “We’re not just working with musical artists. We’re working with visual artists, photographers. I’m drawn to that. As an entrepreneur, when you’re building a company, you want to give it the best opportunity to succeed. Detroit, with its rich talent and culture, does that.”

Seeing it through

Assemble Sound co-founder Garret Koehler (left) with his Detroit recording studio has helped artists like Detroit-based pop artist Siena Liggins get their music out to the masses. | GARRET KOEHLER VIA INSTAGRAM

Che Pope, who since 1994 has worked with stars such as Dr. Dre, Aretha Franklin and Jay-Z, plans to establish his new music-based lifestyle company WRKSHP in the city.

of ways, such as influencing on social media and in fashion.

Pope, who began visiting the city in 2015 for the first time in about a decade, said a plethora of resources

“ARTISTS ARE SMALL BUSINESSES, WHETHER THEY’RE GIG MUSICIANS, DANCERS, DESIGNERS, ACTORS, STORYTELLERS, SET DESIGNERS, PUPPETEERS OR ANY OTHER CREATIVE.” — Rochelle Riley, Detroit Arts, Culture and Entrepreneurship Director

The venture, backed by billionaire Dan Gilbert, focuses on finding new talent in Michigan and from afar, and plans to serve as a space to help artists grow their brand in a variety

will be available to WRKSHP talent.

“Every artist is different,” he said.

“What artist A needs is different from what artist B needs. One may need talent development and media

Even with access to support and resources, patience as a music entrepreneur is vital, Spot Lite's David said.

“Because we own our building — that was one of the reasons (the bank) lent to us, because we had collateral against the loans,” said David, who owns a total of 21,000 square feet of building space at the corner of Charlevoix and Beaufait streets. “I do know a lot of people, though, who have gotten loans even though they don’t own a property. Resources are available, but the waiting process is intense.

There’s a lot of paperwork and running around. You just have to be tenacious.”

Still, David is inspired by the energy and potential she sees every day in the city’s music scene.

“There’s a lot of room to grow the scene,” she said. “There are people here who want to do the work, but they need support and a push. This is the home of Motown, Techno, and it’s essentially the home of R&B. There’s a great opportunity for everybody to be a part of it and create a huge, well-rounded scene.”

Contact: jason.davis@crain.com; (313) 446-1612; @JayDavis_1981

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SERVICES

FINANCE

First Independence Bank in Detroit finalizes Minneapolis expansion

BY NICK MANES

Michigan's largest Black-owned bank has received federal approval to expand to the Minneapolis area, an initiative to further push for racial and economic equity in the wake of the 2020 murder of George Floyd by police in the city.

Detroit-based First Independence Bank announced its expansion to Minneapolis in August. The more than 50-year-old lending institution — one of less than 20 Blackowned full-service banks in the country — said Monday that it had received the necessary approvals by the Federal Kelly Deposit Insurance Corp.

“This approval from the FDIC confirms what our supporting financial institutions have demonstrated that they recognize as well – that our bank is welcome in the Twin Cities market because it’s important to have a variety of options available for all customers in the market," First Independence Bank Chairman and CEO Kenneth Kelly said in a news release. "It’s

especially important for the unbanked members of the community.”

The expansion to Minneapolis marks the first time First Independence has ventured outside of Detroit. The bank plans to open its first Minneapolis branch in late February, and has a second branch in the city still in the planning stages, according to a release.

As part of its expansion to Minneapolis, First Independence received widespread support in terms of capital, research and other services from a host of institutional parters in the region, including Bank of America, Bremer Bank, Huntington Bank, U.S. Bank and Wells Fargo, according to the release.

Kelly has previously told Crain's that the bank raised approximately $20 million in equity as part of expansion.

As of Sept. 30, First Independence has about $406.7 million in total assets, according to its most recent federal regulatory filing.

First Independence Bank plans to open its first Minneapolis branch in late February. | FIRST INDEPENDENCE BANK

Detroit-based Skinphorea, which focuses on skin care for all cultures, plans to open 20 new locations in the next three years. | JERMME

Skinphorea Facial Bar launches plan for nationwide expansion

BY JAY DAVIS

Detroit-based Skinphorea Facial Bar & Acne Clinic is expanding again, this time as it opens franchise opportunities in six additional states.

The business, which focuses on multicultural skin care, plans to begin its nationwide expansion in Dallas, Texas, with franchising opportunities also available in Ohio, Arizona, Georgia, Maryland and North Carolina, Skinphorea said in a news release.

Co-owners Jessie Hayes-Stallings and Sharesse Shorter project to open 20 locations within the next three years with expected revenue of $9.2 million by the end of 2025, the release stated.

Hayes-Stallings and Shorter on Monday called the move "exciting."

"This means more opportunity, more jobs, being able to create six-figure positions for our management team, and providing hope and the blueprint for other women who look

like us to follow," Hayes-Stallings said.

"We have an idea where the next several locations will be, but nothing is set yet until all legal paperwork is finalized next month. This will serve as the official announcement to welcome those interested in franchising."

To date, Skinphorea has invested about $400,000 in attorney, consultation and other fees and building the company's sales and training team for the expansion, Shorter said.

Depending on location and square footage, the cost to get the franchises up and running will range from $200,000 to $500,000, which includes a $50,000 franchise fee. Each location will have between six and 12 employees, Hayes-Stallings said, depending on square footage and concept.

Skinphorea got its start in 2016 in Royal Oak, melding quality care with a happy hour feel. A second shop opened last year in the Corktown neighborhood of Detroit. It hit $1.5 million in revenue in 2021, including

$350,000 that the Corktown location brought in in six months, Hayes-Stallings said.

Skinporea aims to stand out on a $148.3 billion global skin care market by highlighting the education component of skin care. Further expansion has always been in the cards, according to the co-owners.

Each franchisee will travel to the Corktown location for training sessions with Hayes-Stallings. Further training will take place at each franchise shop prior to and following its opening.

Franchising does not signal the end of the company's expansion efforts.

"Not only are we franchising, we're working on five additional corporate locations across the country, and on expanding and rebranding our product line," Shorter said. "We're just getting started."

Contact: jason.davis@crain.com; (313) 446-1612; @JayDavis_1981

TRANSPORTATION

First wireless EV-charging road in U.S. to be built near Michigan Central Station

BY KURT NAGL

The first wireless EV-charging road system in the country will be built near Michigan Central Station in Detroit by Israeli startup Electreon, officials announced Tuesday.

The mile-long stretch of public road, which will be designed to wirelessly charge electric vehicles while they are stationary and in motion, is expected to be complete by 2023, according to a news release from the state. Electreon will work with NextEnergy and Jacobs Engineering Group on the project.

The inductive vehicle charging pilot, first announced by Gov. Gretchen Whitmer last year at the Motor Bella show in Pontiac, will be funded through $1.9 million from the Michigan Department of Transportation and an unspecified contribution

from Electreon.

Electreon declined to say how much it is investing, but the request for proposal for the project required the contract winner to match at least 25 percent of the $1.9 million, said Michele Mueller, senior project manager, connected and automated vehicles, for MDOT. The project will also be supported

by Ford Motor Co., DTE Energy Co. and the city of Detroit.

"As we aim to lead the future of mobility and electrification by boosting electric vehicle production and lowering consumer costs, a wireless in-road charging system is the next piece to the puzzle for sustainability," Whitmer said in the release.

The road will be located within Ford's Michigan Central mobility innovation district, though the exact location has not been determined,

MDOT spokesman Michael Frezell said.

The wireless roadway project symbolizes Michigan’s commitment to building EV charging infrastructure and staying ahead of the curve on technology, according to officials. It also fits into MDOT’s plan for a new 40-mile “connected corridor” from Detroit to Ann Arbor.

"Michigan is aggressively rolling out various charging solutions and we need to continue to stay ahead of the technology curve," MDOT Director Paul Ajegba said in the release. "A wireless in-road charging system will be revolutionary for electric vehicles, potentially extending their charge without having to stop."

Electreon, founded in 2013, has projects in Tel Aviv; Gotland, Sweden; and Lombardy, Italy. The foun-

dation of its wireless charging technology is electromagnetic induction.

The company installs copper coils under the asphalt of roadways, through which it transfers energy from the electricity grid and creates a magnetic field. Receivers installed on the floor of an electric vehicle capture the energy and transmit it to the battery and motor.

"We're excited to be transferring our success in wireless charging for a variety of electric fleets — from cars to buses and heavy-duty trucks — to this innovative project,” Stefan Tongur, vice president of Electreon, said in the release. “There's important work ahead with our partners in Detroit to develop scalable, 'plugfree' charging that will future-proof the city's EV infrastructure.”

Electreon will not generate revenue through the project in Detroit,

Mueller said. The company said its aim is to prove its concept effective and then scale beyond pilot projects to generate revenue. "...We offer flexible approaches, depending on the customer/client use case and what's the best fit, including public-private partnership, relationships and CaaS - Charging as a Service," according to the company's business model.

Mueller said the pilot is a learning opportunity for the startup and the state.

"This will allow us the opportunity to set standards and specifications for the system," she said. "We do have the vision for having electrification here, and that’s why we’re doing the pilot. We’re going to learn a lot."

Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl

12 | CRAIN’S DETROIT BUSINESS | FEBRUARY 7, 2022

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POLITICS

Whitmer campaign gives state party $3.54M Who gave what in first round of fundraising

BY CHAD LIVENGOOD

Gov. Gretchen Whitmer's re-election campaign dumped $3.54 million in excess donations into the coffers of the Michigan Democratic Party as the Republicans vying to face her in the November election reported spending more than their campaigns took in in donations.

The $3.54 million came from donors who contributed above the $7,150 per individual limit to the Whitmer campaign, which exploited a loophole in state law allowing it to raise excess funds because there were active — and very long-shot — recall campaigns against the Democratic governor.

The Secretary of State's office had said the Whitmer campaign could legally collect donations beyond the $7,150 maximum limit, but the governor's re-election campaign opted to donate the money to the state Democratic Party instead.

Whitmer's campaign also reported refunding a $250,000 excess donation to trial attorney Mark Bernstein, managing partner of The Sam Bernstein Law Firm in Farmington Hills.

Even though the Whitmer campaign donated the excess funds to the Democratic Party, it continued to accept big checks exceeding normal contribution limits utilizing the recall campaign finance loophole.

One of Whitmer's mega-donors was Arn Tellem, vice chairman of the Detroit Pistons, who donated $25,000 to the governor's re-election

committee in November. To date, Tellem has donated $95,650 to Whitmer's campaign, records show.

The incumbent governor's campaign reported raising $2.5 million during the last 10 weeks of 2021 and spent $1.72 million, leaving Whitmer with $9.9 million in cash on hand to start the new year, according to a campaign finance report filed last week.

Whitmer's would-be Republican opponents reported a mixed quarter in their fundraising totals between Oct. 21 and Dec. 31.

Businessman Kevin Rinke reported loaning his campaign $2 million.

The former auto dealership owner has vowed to spend $10 million of his personal fortune trying to win the governor's office.

Rinke reported raising less than $5,000 from a handful of donors and spent $537,256 during the quarter getting his campaign off the ground, according to his quarterly campaign finance report.

Former Detroit Police Chief James Craig's gubernatorial campaign was under water, financially, in the last quarter of 2021, records show.

The $607,830 Craig raised between Oct. 21 and Dec. 31 was outpaced by his campaign's $728,733 in expenses.

Craig's campaign on Monday said it had raised $200,000 in the month of January, but that wasn't a month included in the quarterly report filed with the state Bureau of Elections.

Craig's campaign netted maximum $7,150 individual donations from Compuware founder Peter Kar-

Michigan Gov. Gretchen Whitmer raised excess contributions as a result of a loophole that allows increased giving when a sitting candidate is facing a recall election.

Former Detroit Police Chief James Craig. |

manos Jr. and his wife, Danialle, as well as Monroe Dodge dealership owner Ralph Mahalak Jr. and Larry Masserant, CEO of Newport-based construction contractor Mid-American Group, records show.

Other big names in Craig's donor list included Soave Enterprises owner Anthony Soave ($1,000), former

ARTS AND CULTURE

MOCAD names new leaders

Attorney General Mike Cox of the Mike Cox Law Firm PLLC in Livonia ($2,500) and former Detroit emergency manager Kevyn Orr of the Jones Day law firm ($1,039.81), who hired Craig as police chief in 2013 during state control of the city.

Craig's $5,000 donors last quarter included Barton Malow executive Ben Maibach III, Feldman Automo-

Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood

HEALTH CARE

DMC promotes Brittany Lavis to permanent CEO

BY DUSTIN WALSH

Museum of Contemporary Art Detroit

| MUSEUM OF CONTEMPORARY ART DETROIT

New top exec brings global experience

BY SHERRI WELCH

The Museum of Contemporary Art Detroit has named a new executive director after an 18-month-long, international search.

Cara Courage will join MOCAD as its next leader from the Tate Exchange, the socially engaged art platform of Tate, one of UK’s largest contemporary art museums, on a part-time basis on Feb. 14 and full time later in the spring.

In a related move, MOCAD promoted Marie Madison-Patton, director of business operations, to deputy director, effective immediately.

Courage, who is English-born, has led the Tate Exchange in London for the past four years.

She will fill a vacancy left after MOCAD’s board fired the museum’s for-

Businessman Kevin Rinke

JEFF KOWALSKY

tive Inc. owner Jay Feldman, Blue Link Wireless partner Nemir Nadhi, retired Lear Corp. CEO Matt Simoncini, Landmark Contractor Co. CEO Nazir Jawich and restaurateur Joseph Vicari and his wife, Rosalie.

The Craig campaign said last week that it has hired Houston-based GOP strategist Jeff Roe and his firm Axiom Strategies as its general campaign consultant. In November, Grand Rapids-based Republican strategist John Yob quit Craig's campaign.

A pair of Craig's GOP competitors also reported spending more money than they raised during the quarter.

Garrett Soldano, a Kalamazoo chiropractor running for governor on a grassroots platform that he created during Whitmer's COVID-19 pandemic shutdowns, reported raising $251,746 and spending $410,166 during the fourth quarter, according to his finance report.

Conservative commentator Tudor Dixon raised $158,115 and spent $227,598 during the final quarter of 2021, according to her finance report.

Republican businessman Perry Johnson, who entered the primary race last week, said Monday he is pouring more than $2.5 million of his personal fortune into his bid for governor.

"I am hereby putting $2,528,634.41 into my campaign for Governor to demonstrate that we will financially compete with Governor Whitmer and have the strength necessary to defeat her in November," Johnson said in a statement.

Yob is now working for Johnson.

Courage

Madison-Patton

mer leader Elysia Borowy in July 2020, following an internal investigation into reports of racial and gender bias, poor management and employee harassment and bullying by a large group of former employees. Borowy later challenged the findings.

“During the past 18 months, MOCAD board members have taken the time to talk with our staff, community and stakeholders to determine our needs for the future,” said MOCAD Chair Elyse Foltyn in a release.

The search has produced a leader “with the expertise and leadership we need to build upon our current mo-

mentum and make us even stronger for the next decade,” she said.

The leadership Courage will bring will be especially important as MOCAD reignites a capital campaign to fund critical improvements to its more than 100-year-old Albert Kahn-designed building, strengthen its connection with the community and enable it to serve more people, she said.

MOCAD named board member Laura Hughes interim executive director in December 2020. Two senior-level staff had been providing oversight for MOCAD prior to Hughes.

Courage, 46, brings worldly leadership and expertise from the arts sector with a specialization in collaborative placemaking and activist arts, which she will use to center Detroit’s communities in developing MOCAD as a site for positive social, diverse and equitable change, MOCAD said in a release.

Contact: swelch@crain.com; (313) 446-1694; @SherriWelch

Detroit Medical Center last week named Brittany Lavis as the permanent CEO of the health system after three months filling in on the role.

Lavis, 32, has served as interim CEO since October, following Audrey Gregory’s departure in September.

Gregory is now president and CEO of AdventHealth Central Florida North Region.

Prior to serving as the interim top executive, Lavis was DMC’s CFO. She joined DMC in Lavis 2018 from Tenet Healthcare’s Placentia-Linda Hospital in California, where she served as CFO. She also served as group CFO for all seven of Tenet’s hospitals in Southern California.

Prior, she served as the assistant CFO for WellStar Atlanta Medical Center and interim CFO for Piedmont Medical Center in South Carolina.

“I am enthusiastic about having the opportunity to lead the DMC,” Lavis said in a press release. “We have a strong team of dedicated leaders, staff and physicians who are

committed to the communities we serve. We have a solid foundation and are well-positioned to continue to fulfill our role as one of the region’s premier health care providers. We have demonstrated a strong and enduring commitment to ensuring everyone has access to the care they need. As we go forward, we will be committed to maintaining and strengthening that commitment.”

Lavis earned a master’s degree in business administration from Wake Forest University and a bachelor’s from Winthrop University in South Carolina.

“Since making Detroit her home in 2018, Brittany has exhibited an unwavering commitment to the DMC,” John Levy, chair of the DMC’s board, said in the press release. “The DMC is an anchor in the community with an outstanding team of health care professionals. With Brittany’s leadership, I look forward to the DMC’s growth as the institution of choice for emergency and sophisticated specialty care.”

Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

FEBRUARY 7, 2022 | CRAIN’S DETROIT BUSINESS | 13

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PEOPLE ON THE MOVE

Advertising Section To place your listing, visit www.crainsdetroit.com/people-on-the-move or, for more information, contact Debora Stein at 917.226.5470 / dstein@crain.com

ACCOUNTING

AUTOMOTIVE

HEALTHCARE / INSURANCE

INSURANCE BROKERAGE

Fenner, Melstrom & Dooling

Our Next Energy

Lockton

Kapnick Insurance

FMD is pleased to announce that Stephen Beresh has been promoted to partner. With more than 10 years of experience in public accounting, Stephen is the firm’s primary auditing and accounting resource and serves as an advisor to a wide range of entrepreneurial clients on issues including strategic planning and business development.

Our Next Energy, Inc. (ONE), a Michiganbased energy storage technology company, has hired Dr. Steven Kaye as Chief Technology Officer to lead the development of a new research and development facility based in the Bay Area of California. At ONE, Dr. Kaye will scale cell research efforts, with a focus on bringing to market high energy chemistries and working with cell manufactures to accelerate scale-up of their technologies’ path to market.

Lockton Companies, the world’s largest privately held, independent insurance brokerage firm, has hired Brenden Ritter as Strategic Consultant. Ritter will partner with clients to create comprehensive benefits plans.

He brings a strong background and a passion for strategic planning and relationship management, most recently as Sales Executive with HUB. Ritter attended Western Michigan University in Kalamazoo. Outside of work, he spends time outdoors and traveling with family and friends.

Kapnick Insurance is pleased to announce that Angela Dean has taken on the responsibility of leading the Employee Benefits Sales Team. Originally joining the firm in 2003 as a sales producer, Dean was one of the original 10 partners when the Kapnick family began expanding ownership in 2019. In her new, expanded role, she will be responsible for all aspects of sales leadership including recruiting, coaching, and taking Kapnick’s mentorship program to the next level.

Anderson, Eckstein & Westrick, Inc.

Health Alliance Plan (HAP)

Anderson, Eckstein & Westrick, Inc. is pleased to announce that Rodney Velez, PE has joined our Engineering Team as a Sr. Project Engineer. Mr. Velez has over 20 years’ experience working with Municipalities, Water Resource Commissioners, County Drain Commissioners, County Road Commissions, FEMA, EGLE, MDOT and MDARD. Mr. Velez holds a Bachelors degree in Civil Engineering and professional memberships in the American Society of Civil Engineers, and the American Council of Engineering Companies.

Health Alliance Plan (HAP) has named Christine Harder senior vice president, Provider Network Management, responsible for engaging, supporting and growing HAP’s health care provider network. She was previously vice president of Provider Operations at HAP. With a combined 28 years of experience at HAP and its parent company Henry Ford Health System, her knowledge of how both sides of the industry operate will greatly benefit provider relationships as HAP continues to expand across the state.

Action Benefits is pleased to announce that Lori Lockhart, who has served as Acting President for over two years, has formally been named President.

Lori joined Action in 2007 as V.P. CIO. During her tenure, she and her team developed Action’s industry-dominant private health insurance exchanges, CoverageForCompanies® and CoverageForOne®. Lori’s experience provides her the business foundation to successfully step into the role as President and help lead the organization into the future.

Action Benefits has a 34 year history of industry leading service in the small group, individual under 65 and Medicare markets.

As the largest small group health coverage producer in Michigan, Action Benefits works with over 2,000 agents across the state.

ACTION

REAL ESTATE

Hunter Pasteur Hunter Pasteur has named Jake Dangovian Vice President of Finance.

The new role expands his duties to include financial reporting, investor relations, cash flow and trade partner management. Dangovian previously served as a senior financial and acquisitions analyst—responsible for budgeting and reporting systems throughout Hunter Pasteur’s portfolio. His career began at Hunter Pasteur more than three years ago. Dangovian was drawn to its commitment to developing beautiful communities.

NEW GIG?

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C O N TA C T

HEALTHCARE / INSURANCE

` Stoneridge Inc., Novi, designer and manufacturer of electrical and electronic vehicle systems, and Valens Semiconductor, Hod Hasharon, Israel, a semiconductor manufacturer, have a partnership to introduce vision and safety systems in tractor trailers. Website: stoneridge.com

` EXPANSIONS

` MERGERS & ACQUISITIONS

PRODUCTS

ARCHITECTURE / ENGINEERING

` McDurmon Distributing Inc., Fenton, a marine supply store, partnered with Dexter Axle Co., Elkhart, Ind., a trailer, parts and accessories manufacturer, to offer Dexter products to its dealers. Website: mcdurmon.com

Action Benefits

Northstar Bank Northstar Bank, an independent community bank headquartered in Michigan, announced the addition of Rajesh Kothari to its Board of Directors.

Kothari is the Founder and Chairman of Cascade Partners LLC/Cascade Partners BD, LLC in Southfield. His vast experience, combined with his deep commitment to meeting the needs of businesses and communities, will play a vital role as the bank continues to grow and build strong momentum. For more information on Northstar Bank visit www.NorthstarAtHome.com.

` ProPride Hitch, Holly, a towing hitch manufacturer, has a partnership with SuperSprings International Inc., Carpinteria, Calif., provider of suspension technology, to use SuperSprings’ products. Website: propridehitch.com

INSURANCE

FINANCIAL SERVICES

Anderson, Eckstein & Westrick, Inc. is pleased to announce that Michael Behunin, BSCM has been promoted to the position of Construction Services Lead. He holds a Bachelor’s degree in Construction Management and has over 40 years of experience that includes inspection, contract administration, project management of water and wastewater infrastructure. Notable past projects include the New York State Thruway with 15 Bridge Structures, and the St. Lawrence Western Region Welland Ship Canal Locks.

` CONTRACTS

` Alpine Power Systems Inc., Redford Township, provider of power and battery solutions, made a $2.3 million investment in service vehicles to keep up with growth in the power, telecom, cable and motive power divisions. The investment included the purchasing of 14 new box trucks and 15 new service vans outfitted to service customers. Website: alpinepowersystems.com

ARCHITECTURE / ENGINEERING

Anderson, Eckstein & Westrick, Inc.

DEALS&DETAILS

Laura Picariello Reprints Sales Manager lpicariello@crain.com (732) 723-0569

`BorgWarner Inc., Auburn Hills, an automotive supplier, invested in Qnovo Inc., Newark, Calif., developer of battery management software.

BorgWarner is the lead investor for Qnovo’s multi-million-dollar Series-C capital raise. Website: borgwarner.com ` All Star Auto Lights, Orlando, Fla., distributor of alternative automotive parts and a portfolio company of Atlantic Street Capital, acquired Autolights LLC, Ferndale, seller of refurbished headlights, taillights and fog lights primarily to the collision repair industry and automotive dealers.

Website: allstarautolights.com

CRAIN’S AWARDS

Mark your calendar for upcoming deadlines Crain’s Detroit Business is seeking outstanding business leaders for upcoming recognition in our Notables in Michigan series.

Nominations for executive-level business leaders currently working in or supporting the EV industry are due Friday, Feb. 25. Notable Leaders in EV will be featured in our May 16 issue.

We are also seeking nominees for Notable Women in Construction, Architecture & Design. Tell us about an accomplished woman leading in site selection, project management, design, build, landscaping, administration, general contracting or other related work. The deadline to nominate is March 4, and winners will be featured in a special section on June 6.

Visit crainsdetroit.com/nominate for more information, to submit a nomination and for a complete list of this year’s awards programs. Questions may be directed to special projects editor Amy Bragg: abragg@ crain.com.

14 | CRAIN’S DETROIT BUSINESS | FEBRUARY 7, 2022

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GOODBILL

PEOPLE

From Page 3

Royal Oak resident Daniel Hill last month took over as downtown manager of the city Downtown Development Authority. Hill in the position is tasked with promoting economic growth in the city. | SIREN STRATEGY

Royal Oak’s new downtown manager aims to fill spaces, lure more retailers

BY JAY DAVIS

Royal Oak’s Downtown Development Authority has hired a new manager.

Daniel Hill will work with businesses, oversee promotional activities and promote growth for the Oakland County city’s downtown area, which is known as a destination for entertainment, retail and restaurants and bars.

Hill, a 27-year-old Royal Oak resident, comes to the position from three years in Berkley, where he was most recently assistant to the city manager. Hill replaces Sean Kammer, who left last spring to manage Birmingham’s downtown.

Hill said the position combines a lot of his interests and makes use of

this bachelor’s degree in marketing from Saginaw Valley State University.

“A lot of the position is working with the downtown businesses to make sure they’re lifting each other up through different avenues such as social media and websites,” said Hill, who stepped into the position just after the first of the year. “We want to help make sure entrepreneurs want to open businesses in Royal Oak.” With it being very early in his tenure, Hill said he hasn’t identified specific businesses he’d like to see move into Royal Oak, but that additional retailers would add to the vibrancy of the area.

As of last month, Royal Oak retail and office space had an occupancy rate of 96.6 percent and 91.1 per-

cent, respective, according to the city website.

“Anybody who walks through our downtown sees a number of businesses that have closed due to the pandemic,” Hill said. “There’s room for rehabilitation, and new businesses in existing spaces. Our Center Street space across from the post office, we’ll be actively recruiting for that space in the coming months once we come out of the pandemic.”

Royal Oak Deputy City Manager Todd Fenton said only a handful of businesses have closed since the start of the COVID-19 pandemic. Of those, most have tenants interested in moving in.

Contact: jason.davis@crain.com (313) 446-1612; @JayDavis_1981

FINANCE

Adient takes $54 million net loss in Q1 as supply chain problems persist

BY KURT NAGL

Adient plc took blows to its top and bottom lines in the first quarter due largely to the semiconductor shortage, volatile production and the same supply problems that have pinched the industry for more than a year.

The Dublin-based seating supplier, whose North American headquarters is in Plymouth, had a net income loss of $54 million in the first quarter of fiscal year 2022, compared with a $150 million gain in the same period last year, according to its earnings presentation Friday.

The company’s revenue slipped to $3.5 billion, down from $3.8 billion a year prior. The company recorded $13.7 billion in revenue in fiscal year 2021 and said it expects full-year revenue of $14.8 billion in FY2022.

Executives said on an earnings call Friday that the unpredictability of

operations is hindering the company’s progress on improving its balance sheet.

“It’s the only time in my career I can recall the industry being impacted by supply constraints versus demand,” Doug DelGrosso, president and CEO of Adient, said during the call. “The environment we’re operating in is extremely fragile.”

The spread of the omicron variant of coronavirus led to “huge absenteeism” across its plants, executives said, while the “stop-and-start” nature of production by automakers also contributed to higher labor costs.

There has been some relief on the commodities side. Adient expects a $95 million hit this year due to increased commodity costs, down from $125 million last year, due to a modest dip in steel prices as well as successful negotiations for customers to help absorb costs.

Analysts have predicted that the microchip shortage, expected to cost the industry $210 billion, will ease progressively this year. Adient has said it is “cautiously optimistic” that business will rebound on that same timeline.

Other suppliers have been dragged down with the same issues. Seating competitor Lear Corp. took a $27 million net income loss on a 13 percent revenue slide last quarter. The Southfield-based company is scheduled to report fourth quarter earnings next week.

In addition to production launches abroad, including seats for the Ford Everest and Ranger in Asia, the company was awarded the replacement Ram 1500 complete seat business in the Americas, which is its largest platform by revenue.

Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl

The real goal of Goodbill is to aid in navigating the often confusing world of medical bills. Few consumers use hospitals’ transparency data, Crain’s reported last year.

Goodbill, which is currently in beta testing, is designed to allow users to tabulate whether they had been overcharged for a hospital procedure by generating comparable procedures from the hospital price-transparency data and automate the user’s ability to dispute and negotiate those charges.

“Nearly every single hospital bill is negotiable,” Haig said. “Our product empowers the user to use the data available for a lower or more accurate bill. You can know not only what Beaumont charged you, for instance, but what other users are charging for the same services.”

The software also checks for errors in the billing codes, which Haig and Sefferman said is common, so the user can bring this to the billing department to reduce their bill.

The co-founders are also working to build out the app for a “negotiated outcome-as-a-service” service. Here the app would automate the bill negotiation for the user.

Goodbill has raised more than $3 million from a stable of high-profile investors, including Seattle-based venture capital firms Maveron and Founders’ Coop, as well as from notable angel investors Dan Yoo, former CEO of

Goodbill works by itemizing your hospital bill, cross-referencing the bill with comparable procedures, finding errors and offering advice on how to negotiate with the health system. | GOODBILL

Nerdwallet, and Christian Sutherland-Wong, CEO of Glassdoor, among others.

Haig and Sefferman expect a larger launch of the Goodbill product in the coming months.

“We’re targeting market by market,” Haig said. “We’re hoping the reimbursement element shakes out any problems in the consumer experience while we make sure our data is good for larger launch.”

Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

Advertising Section

CLASSIFIEDS To place your listing, contact Suzanne Janik at 313-446-0455 / sjanik@crain.com

JOB FRONT NONPROFIT

POSITION AVAILABLE

Civiccore CDC seeks financing

Methode Electronics has a job opening in Southfield, MI: • EMC (Electro-magnetic Compatibility) Lab Manager (YKEMC): Manage all aspects of the EMC lab, including cost, timing, technology, HR, testing & report generation. Perform root cause metrics analysis. To apply, submit resume to resumes@methode.com and reference job code YKEMC

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MARKET PLACE BIDS WANTED

BUSINESSES WANTED

Bankruptcy case no. 21-45708 EDMI. For sale: Upper penin. franchise hotel on I-75 Bus. Spur, Sault Ste. Marie, MI. 2021 gross rev $1.4 million. Bk sale motion pending, subject to court approval & higher bids. Next min. bid $3.545 mill.

Contact Ch 11 bk trustee Kim Clayson 313-306-7745 or kim@redhouselaw.com for financials, bid instructions and APA info. Bid qualifications by 2/22/2022.

Auction on 3/10/2022.

We at Griffin Moor are seeking a business in the Corrugated Box industry to acquire within the Midwest.

Please contact us and reference mandate AD344

FEBRUARY 7, 2022 | CRAIN’S DETROIT BUSINESS | 15

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ELMS

From Page 1

— offering them a quicker access to the stock market than an initial public offering, but often more risk for investors.

Electric Last Mile’s stock (NASDAQ: ELMS) cratered on news of the resignations, and by the time markets closed Wednesday, shares were down more than 60 percent year-to-date and more than 50 percent since the prior day. At the time ELMS went public in late June, the company obtained a valuation of about $1.4 billion, but had a total market capitalization of about $336 million on Wednesday as markets closed.

The company declined requests for an interview and additional details on the executives’ departure.

The exit of Taylor and Luo stands as just the latest example of executives at EV companies leaving amid questions of wrongdoing.

Industry analysts say the news offers little upside for investors, particularly given that Taylor and Luo were “the linchpins” of the company’s “strategic and holistic vision,” according to an investor note written Tuesday evening by Dan Ives, managing director and senior equity analyst with Wedbush Securities.

The two executives had deep connections to the Chinese auto industry, something that had offered the company a leg up, Ives wrote.

“With both gone under dark cloud circumstances, the ELMS bull story is tossed out the window and has minimal credibility in the eyes of investors and puts major uncertainty around the name until more details are known,” Ives wrote in the note, downgrading the company’s stock. “With investors already skeptical of many unproven EV startups, this is potentially back breaking news to the ELMS story and we clearly cannot stay on board with a positive bias.”

The analyst added that the only likely upside for the company going forward is its “potential M&A value.”

Improper purchase The improper sale and purchase of company equity was orchestrated by

THRIVING

From Page 1

They want things to happen, but when the interest comes from outside, it creates anxiety, she said. “Those are the places where I think it’s important to look at what people are feeling and what they need.”

Feedback from residents has often been considered anecdotal or oneoffs, said Hood, who chairs the Detroit Planning Commission, led the Live6Alliance in Detroit from 2015-17 and has a master’s degree in community development from the University of Detroit Mercy.

The index will validate what people are saying so it can’t be dismissed, she said.

“At the core of this is just understanding the whole story is not told by unemployment numbers or housing values,” she said. “Feedback from citizens on how they are experiencing all this change is also needed.”

Launching a network Hood launched the Institute of AfroUrbanism, a think tank and action lab focused on the intersection of racial justice and community planning, last spring with a $125,000 grant from the New York-based Ford Foundation. She

Urban Delivery electric vans on the production line at the Electric Last Mile Solutions facility in Mishawaka, Ind. | BLOOMBERG

Electric Last Mile Solutions’ stock takes a hit Troy-based ELMS’ stock fell sharply last week upon news that its top executives had abruptly stepped down.

$15 12 9 6 3 $2.36

0

Sept. 21, 2020

Feb. 3

SOURCE: NASDAQ

Luo in the fall of 2020 leading up to its public launch June 25, 2021, according to a company 8-K submitted to the SEC on Jan. 26.

Before its merger with the shell company to go public, Luo owned 100 percent of the company’s shares through his company AJ Capital Inc. In November 2020, the company sold 99,000 shares of common stock for $990,000 to seven investors, including two entities affiliated with Luo, which purchased 78,016 shares, and an entity tied to Taylor, which purchased 6,461 shares. has been developing plans for the “Black Thriving Index” since then.

Detroit Mercy is serving as the institute’s fiduciary while it waits for nonprofit status approval from the Internal Revenue Service.

To date, the Black Thriving Index project has attracted an additional $375,000 commitment from the Ford Foundation and a $175,000 grant from the Skillman Foundation.

“We believe that the Institute will move us beyond the traditional approaches to urbanism and will act as a platform at the University of Detroit Mercy for Black Detroiters to share their lived experiences, ideas, and solutions for revitalizing their own communities,” said Kevin Ryan, Detroit senior program officer for the Ford Foundation. “The Institute’s work fits our strategy to advance equity by ensuring that Black Detroiters have a voice in shaping community development priorities in the city.”

Talks are also underway with Boys & Girls Clubs of Southeastern Michigan, which is looking at a comprehensive partnership which supports AfroUrbanism with space through nonprofit incubator Ponyride, workforce development talent through its Industry Clubs and additional financial support, CEO Shawn Wilson said.

Hood has set an early goal to capture feedback from about 2,000 residents in

The equity was purchased for $10 per share, but after going public, each one of those shares was exchanged for approximately 800 shares in the company, which at its peak traded for $14 per share.

Giving executives equity in a company at a discount rate is pretty common practice, but failing to record it as compensation is the problem, said Van Conway, president of Detroit-based Young Conway Group LLC. However, if that were the only problem with its books, it likely wouldn’t take months after finding out to restate finances.

“The problem might be bigger than we think,” said Conway, who has worked in the turnaround business 30 years. “The real issue is what’s the financial condition of the company. To me it’s a red flag because they haven’t figured out exactly what the restatement is.”

SPACs called into question With the speed of the SPAC process comes the downside of some added risk, according to Erik Gordon, a finance professor at the University of Michigan’s Ross School of Business.

Gordon, who has a focus in public market activity among other areas of research, said the SPAC process means that activity such as what the ELMS executives are found to have done is less likely to be uncovered in a timely fashion. In a traditional IPO, investment the target neighborhoods.

She is working with a pair of graduate students from her alma mater, the University of Detroit Mercy’s School of Architecture and Community Development, to conduct research and develop the index.

As part of the project, the institute will hire a trusted resident “fellow” with strong relationships in each of the target neighborhoods.

“Instead of it being an academic or nonprofit practitioner, the thinking is you get more authentic input when people are talking to people they know already,” Hood said.

Each fellow will receive a $40,000 salary and an additional $10,000 for supplies and other costs, including an Ancestry.com subscription. Analysis of their background will be included in the curriculum for the fellows, Hood said.

“It’s part of holistic education. In addition to them studying Black thriving, I’m trying to activate Black thriving in them, too,” she said.

Fellows will go through education on Black thriving communities globally and training in research methodology so they know exactly how to interview the people, Hood said.

Updating the index She’s working with an independent

bankers working on a deal have a financial liability and incentive to ensure that such activity is disclosed to investors, Gordon said.

That’s not always the case in SPAC deals, he said, noting that investment banks typically end their work at the point of the sponsor firm — essentially a shell company — going public, and are not involved at the point of the actual merger, the point where Taylor and Luo were said to have improperly acquired shares.

“In a regular IPO, the investment bankers conduct an excruciating amount of due diligence,” Gordon said.

“That doesn’t mean the company is a better company. But it means that fishy stuff is dug up.”

To that end, top financial regulators have highlighted such risks as an area for potential regulatory reform.

In a speech last December to the Healthy Markets Association, SEC Chair Gary Gensler noted the role that “gatekeepers,” such as investment bankers and other advisers, typically play in the IPO process, and said SPACs should not be viewed as a way to curtail those obligations.

“Make no mistake: When it comes to liability, SPACs do not provide a ‘free pass’ for gatekeepers,” Gensler said, according to a transcript of the speech.

The SPAC route has been popular for EV companies for a handful of reasons, but particularity due to the ability to make more forward-looking projections about future business than is allowed under regulations for companies going public via IPO. That ability, however, is causing problems with myriad publicly traded EV companies.

Newark, Calif.-based Lucid Group Inc. late last year disclosed that it had received a subpoena from the SEC regarding its SPAC merger, according to a Bloomberg report.

Before Lucid, the SEC opened investigations into Nikola Corp., Lordstown Motors Corp. and Canoo Inc., all of which have gone public since 2020 following mergers with SPACs.

What’s next ELMS is a small fish in a crowded pond of EV startups competing for the researcher and plans to seek a Detroit Mercy research partner, as well, to develop interview questions. They are likely to include residents to share times in their lives when they felt they or their community were thriving or a time when they did something that had a benefit on someone else, she said.

“In all of my community development teaching, the only time Black (residents were) mentioned was in the context of subsidized housing,” Hood said. “Communities where Black people were thriving, like Paradise Valley in Detroit ... weren’t part of my community development studies.”

Traditional community development teaching focuses on what a neighborhood needs, whether a certain number of parks, religious organizations or something else, Hood said.

But she’s focusing on what Black people, specifically, need to thrive in terms of relationships, networks and social supports and studying places like Paradise Valley that have thrived in the past.

“What Black people and white people need in order to thrive is different,” Hood said.

Everyone needs the basics of food, shelter and safety. But Black people need their culture reflected back to them, with positive examples of leaders who look like them, she said.

attention of investors eager to catch the next Tesla or Rivian. The company said in September that its all-electric delivery van went into production — a milestone many EV startups never achieve.

It claimed last March that it secured more than 45,000 non-binding pre-orders, and in September, announced 1,000 orders from Randy Marion Automotive Group. A YouTube video showed electric vans rolling off the line at the company’s Mishawaka, Ind., assembly plant, and dealership executives posing for photos.

Owner Randy Marion told Crain’s on Thursday that the dealership group has nearly 8,000 purchase orders for the ELMS vehicle from its customers.

“When this became public yesterday, we called them and were reassured that the people that we had purchase orders for were still willing to buy the vehicles, so we’re just hoping that they can build the vehicles,” Marion said. “Everybody’s wanting to get into this electric thing.”

Marion said Electric Last Mile has yet to ship him an electric commercial delivery truck, though he has received some units classified as prototype or off-road. The dealership group does not pay for an order until it is filled.

ELMS’ most recent financial report, which has been restated, shows that it was losing millions of dollars and had little revenue, which is common for startups working to scale up.

While the company is not yet dead in the water, surviving Wall Street’s cold shoulder and the inevitable onslaught of legal issues and probable class action lawsuit won’t be easy, Conway said.

Whenever a stock slides dramatically to potential pre-bankruptcy levels, as was the case with ELMS, lawyers descend on the company in search of wrongdoing and grounds for a lawsuit.

Within a day of ELMS announcing its leadership change and restatement, half a dozen law firms sent out news releases encouraging stockholders to join class-action lawsuits.

“They’ve done the right thing so far after a bad thing happened,” Conway said of the ELMS board. “They have to establish credibility.”

— Bloomberg contributed to this report.

Hood is conducting the first 50 interviews and expects to release the results of those in March.

“We will come up with a hypothesis of what the standard conditions and criteria will be and then go citywide for the next year,” she said.

Hood said the plan is to replicate the index again after the first year to track changing responses in the neighborhoods. She’s consulting with other data groups like Detroit Future City and Data Driven Detroit to determine how frequently the index should be done.

Beyond gathering current feedback from real people living in the neighborhoods, the report might be a good basis for conversations on what Black residents want in terms of reparations, Hood said.

“Part of these conversations is to help people flex their asking muscle,” she said.

Especially when there’s a community benefits agreement with developers, residents don’t ask for enough, Hood said.

When residents are asked what they want, “if they haven’t been primed to think about it or are stuck in survival mode, their responses don’t give all that is possible,” she said.

Contact: swelch@crain.com; (313) 446-1694; @SherriWelch

16 | CRAIN’S DETROIT BUSINESS | FEBRUARY 7, 2022

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NONPROFITS

Events leading up to the Beaumont Health-Spectrum Health merger Beaumont Health’s name will remain in place but it will be led by new parent company BHSH under Spectrum’s Tina Freese Decker. The merger deal comes after a long history of Beaumont growing through acquisition.

2007: William Beaumont Hospitals, which operated community hospitals in Royal Oak and Troy, acquires Bon Secours Hospital in Grosse Pointe.

2012: Beaumont begins merger talks with local rival Henry Ford Health System to create a $6.4 billion, 40,000 employee system with 10 hospitals and 200 outpatient centers.

Nurse Kelsey Hodge treating a COVID-19 patient at Beaumont Hospital in Royal Oak last spring. | CYDNI ELLEDGE/SPECIAL TO CRAIN’S DETROIT BUSINESS

FORWARD

From Page 1

homes for everything from vaccinations to diabetes care.

The pandemic pushed health care trend lines five years forward, and an increased investment in these areas could propel Beaumont to the top of the lot in metro Detroit.

“Digital health and at-home services can really level the playing field,” Kopson said. “There’s a lot room for improvement in telehealth and digital record access for those with the money to spend.”

The merger not only created the state’s largest employer with 64,000 employees but also created a financial behemoth that can throw its weight around in capital markets.

Spectrum, for instance, held $1.1 billion in debt at the end of 2021. But it’s flush with cash and can sustain its operations without a single cent coming in the door for 246.3 days. Its debt-to-capitalization ratio was only 16.3 percent, well below the Moody’s median of 24.9 percent.

This, of course, translates to a system that can access a lot more cash easily to enact investments into Beaumont if it so chooses.

The reason it’s paramount for the new system to invest heavily in its operations is simple — growth can only occur by stealing patients from competitors or creating new business lines, because the number of patients isn’t changing.

Hospitals across the state and nation are dealing with a patient experience that has been upended by the pandemic and will need to be rebuilt.

Government orders and, later, increasing staffing issues led to canceled procedures. Patients in emergency rooms were experiencing wait times six hours and longer during pandemic peaks.

“Right now, health care nationally has been severely disrupted by the pandemic,” said Alex Calderone, president of Birmingham turnaround firm Calderone Advisory Group. “Inefficient systems became even more inefficient because of the pandemic.

It created bad health care for everyone. No system across the state, maybe across the nation, has done a particularly good job of serving its patients in the COVID environment.

If you’re the new Beaumont-Spectrum system, there’s never been a greater opportunity than what exists today in the history of health care.”

Calderone believes Beaumont’s name has been tarnished to a near irreparable degree and a new name is part of the healing needed between staff and administrators.

Mark Kopson, partner and leader of the health care practice for Bloomfield Hills-based law firm Plunkett Cooney, “JOHN Q. PUBLIC STILL HAS A VERY said it’s difficult to ruin a good brand HIGH OPINION OF BEAUMONT IN name, and BeauSOUTHEAST MICHIGAN.” mont’s still has value.

“Insiders may feel — Mark Kopson, Plunkett Cooney that way, but John Q. Public still has a very high opinion of Michigan’s population is growing Beaumont in Southeast Michigan,” at an abysmal pace, compared with Kopson said. “It’s a storied name lo- other states, and in 2020 more resically, just like Spectrum has become dents died than were born. The new in West Michigan.” system has to invest in a better paOther details on plans for Beau- tient experience and market itself as mont going forward are not yet clear. such if it plans to boost patient numFreese Decker may have tipped her bers. Or it’s forced to rely exclusively hand for the playbook to remake on selling more services, in line with Beaumont. the strategy of the rest of the systems She said the new entity would in- in the market.

We likely won’t know the entity’s vest in digital health, at-home services and health equity at Beaumont. full strategy for at least another year.

Startups focused on digital health Mergers of this size take longer than such as telemedicine and electronic that to accomplish.

For now, we’re going to see if Frehealth records raised $29.1 billion globally in 2021, more than double ese Decker and company can keep the raise in 2020. During the pan- Beaumont’s staff content and restore demic, we saw more and more at- a reputation that has fallen into dishome services with Beaumont com- repair. petitor Henry Ford Health and large Detroit provider group Wayne Health Contact: dwalsh@crain.com; sending mobile units to patients’ (313) 446-6042; @dustinpwalsh

2013: The deal with Henry Ford falls apart over fine-print details like whether the new combined entity’s headquarters would be in Royal Oak or Detroit.

2014: Beaumont closes on a $3.8 billion deal to merge with Dearborn-based Oakwood Healthcare and Farmington Hills-based Botsford Hospital — a deal that would give the larger Beaumont 30 percent of the local inpatient market.

2015: Beaumont hires John Fox to run its operations and cut costs associated with the integration of the new, larger system. Fox is quickly chastised for cost-cutting measures that impacted retention and the health system begins bleeding some of its top talent.

2019: Beaumont signs a letter of intent to acquire the four hospital system Akron-based Summa Health, which includes paying Summa’s minority owner Cincinnati-based Mercy Health about $250 million.

May 2020: Amid the pandemic, Beaumont calls off the deal as health system revenues plunge thanks to government-ordered closures of elective surgeries and outpatient centers.

June 2020: A month later, Beaumont dangles another deal, this time with Advocate-Aurora, a 26-hospital system in the Milwaukee and Chicago metro regions.

July 2020: The deal, which is expected to give control to Advocate, is met with contempt from Beaumont staffers. Beaumont physicians begin circulating a petition among the hospital’s 5,000 doctors declaring no confidence in Fox, COO Carolyn Wilson and CMO David Wood.

August 2020: The board for Beaumont Health postpones a vote on the merger until the concerns of employees can be discussed and followed with a survey to staff. The results show 76 percent of the responding physicians said they did not have confidence in corporate leadership. A survey of nurses shows 650 had no confidence.

September 2020: Mark Shaevsky, a former Beaumont Health board vice chair and trustee, sends a letter to Michigan Attorney General Dana Nessel objecting to the merger and calling for Fox, Wilson and Wood to be fired. The board of directors receives a letter from 20 Beaumont doctors demanding the merger be addressed because “something is seriously amiss.” U.S. Sen. Andy Levin, state Sen. Mallory McMorrow and state Rep. Jim Ellison, all come out in opposition.

October 2020: Beaumont calls off the Advocate-Aurora Health merger.

June 2021: Beaumont again emerges with its third merger attempt in two years, this time with Grand Rapids-based Spectrum Health. The deal provides Spectrum with access to the Southeast Michigan market and allows it to expand its integrated insurer Priority Health in the area. The deal would create a $12 billion, 10-hospital system with a jaw-dropping 64,000 employees.

September 2021: The merger is delayed by a backlog at the Federal Trade Commission, which under President Joe Biden had promised to take a fine comb to hospital mergers.

2022: The deal passes regulatory muster and Beaumont and Spectrum announce joint operations beginning Feb. 1.

SOURCE: CRAIN’S REPORTING

New Economy Initiative names next executive director

BY SHERRI WELCH

The Community Foundation for Southeast Michigan has named Wayne County economic development executive Wafa Dinaro as the new executive director of the New Economy Initiative.

She will join NEI, a foundation-led effort to support entrepreneurship in Southeast Michigan, on Monday.

Dinaro, 38, succeeds Pamela Lewis, who is stepping down after six years for another opportunity, the Community Foundation said.

Dinaro, named among Crain’s 2021 class of 40 under 40, Dinaro has served as executive director of the Wayne County Economic Development Corp. since 2019 and was deputy director of capital development for the county for a year before that.

A m o n g other accomplishments, she led the Dinaro county’s efforts to distribute $80 million in grants and loans to small businesses in Wayne County during the height of the pandemic in 2020, support that aided 5,000 mostly minority-owned businesses and more than 2,000 women-owned businesses.

Before joining the county, Dinaro served as a business unit leader for Fiat Chrysler Automobiles, held communications roles with Blue Cross Blue Shield of Michigan and Michigan Consumers for Healthcare and was an intelligence officer with the U.S. Department of Defense, working in multiple countries.

“We are excited to have a leader with Wafa’s commitment to inclusive entrepreneurship and small business and experience join the New Economy Initiative,” Community Foundation President Mariam Noland said in a news release. “Wafa will strengthen NEI’s support of Detroit-area small businesses and entrepreneurs' access to capital and technical support.”

Since its inception in 2007 as one the largest foundation-led economic-development initiatives in the country, NEI has focused on supporting entrepreneurship throughout Southeast Michigan. Under Lewis, it honed its focus to helping underserved small businesses. NEI has supported nearly 19,000 companies and helped launch 3,130 companies.

Contact: swelch@crain.com; (313) 446-1694; @SherriWelch FEBRUARY 7, 2022 | CRAIN’S DETROIT BUSINESS | 17

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THE CONVERSATION

Angelique Power on bringing her brand of social equity to Detroit Angelique Power, president and CEO of the Skillman Foundation, developed a passion for racial equity and justice during her childhood as she watched her parents navigate their careers on Chicago’s south side. After a brief stint as a TV star on a popular, local children’s show, she moved forward in her career, holding positions in the private, public and nonprofit sectors before coming to Detroit last fall to lead the foundation and begin a yearlong listening tour. With a degree in English, she loves to write. She’s inspired by Michigan’s trees and Detroit pizza. | BY SHERRI WELCH ` Did growing up on Chicago’s south side as the daughter of a white Jewish mother who was a school teacher and African American father who was a police officer influence your passion for spurring new ways of thinking about racial equity and social justice?

Absolutely. These are professions where they (were) often charged with helping folks that are victims of massive systemic inequity. And in their roles, they’re often blamed for not being able to solve the systemic issue. My mother was a school teacher, but she was a therapist, nurse, chemical engineer, artist and a lawyer, all in one class period. She was working constantly after hours to create engagement in her classroom.

She fielded phone calls from students all the time, who were struggling with a lot of things. And my father, being a Black police officer in Chicago actually watched and witnessed how police are often charged with making sure that certain places are free of crime. He talked very, very thoughtfully about how often police are sent in, not to serve and protect, but to, in many ways, ensure that there’s always a lower class. I think that he struggled with this desire to be a protective guardian of society in an unequal society and struggled as a Black police officer seeing racism internally on the floors, seeing how folks were targeted externally. ` You have a seven-step plan for Skillman. What are the big things that you’re focusing on as part of that plan?

I would say that there are a few big things. One: taking these terms that we are hearing everywhere that are overused and misunderstood, and tying them to operational practice inside of Skillman so terms like racial equity, racial justice systems change. You will hear people calling for these things. And

then it’s business as usual inside of their institutions and businesses, right? Part of our work with the plan is to collectively understand what they mean. And then look at what we’re doing that fits, where we could go and what we aren’t doing that would actually fulfill the promise of racial equity, racial justice and systems change. The other thing that we’re doing is really around putting young people in the driver’s seat. Our youth advisory council became a youth grant making board and they gave $100,000 away.

They research the organizations, they came in and advocated for them. They created a rubric and they decided what, if anything, the organization should do after they receive the funds. We’re already building that for 2022. ` What are education and other leaders seeing as top concerns?

What I hear from champions — and that’s teachers, to principals to after school providers — is that they are over-stretched and have been for a really long time. They are extremely worried about their students and each other and worried we will cobble together quick fixes to address the seismic shifts that the pandemic has created. They want wholesale systems change, new ways of teaching, new pedagogy, new ideas around standardized tests. And while it’s really hard for them to say these things, all of them know teachers need to be paid twice as much as what they’re paid.

When we push, we get to ‘where’s the support in the ecosystem for principals?

What does funding equitably of schools look like (for) students who need more in neighborhoods, whether that’s in Detroit or in rural towns around Michigan?

How do we actually just create funding formulas so that they get way, way more?’

There is this desire for philanthropy to really acknowledge our role in changing how we fund and who we fund.

` What will people find you doing when you’re not immersed in work?

I love cooking. I have a 9-month-old puppy, and so I’m out all the time walking.

I have an MFA in writing, so I write a lot. I’ve been writing about trees. Michigan trees have been, like, just blowing my mind. It’s trees as far as the eye can see here, and they haven’t been planned by an urban planner in certain parks and areas. And every tree what you see above is only a fraction of the community of roots underneath. I spend a lot of time thinking about how my work is actually much like being a tree in a community of other trees. One of my (other) favorite things that I really haven’t been able to do is travel with friends. I love cooking for a big group of kids and like sitting with them and finding out what they’re interested in and what

they’re up to right now and what’s the TikTok dance everybody’s doing. (And) I’m varsity at drinking wine. . ` I hear people have strong opinions about this: what’s the best Chicago pizza joint?

All right. Well, I’m going to tell you two things.

The first one is that the best Chicago pizza is from Medici, which is in Hyde Park on the south side, and it’s phenomenal.

The second thing I want to tell you is that Detroit pizza’s better. This will get me banned from Chicago, so ... ` Have you found a favorite in Detroit?

Maybe this is gonna make us seem sort of basic, but we like Jet’s.

For Thanksgiving we had Chicago family come visit us. And we served Jet’s the night before Thanksgiving, and everybody loved it.

Angelique Power, president and CEO, Skillman Foundation

READ ALL THE CONVERSATIONS AT CRAINSDETROIT.COM/THECONVERSATION

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(313) 446-1626 or nmanes@crain.com Kurt Nagl, manufacturing.

(313) 446-0337 or knagl@crain.com Kirk Pinho, senior reporter, real estate.

(313) 446-0412 or kpinho@crain.com Dustin Walsh, senior reporter, health care.

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UM Museum of Art receives $12M gift of Chinese calligraphy THE UNIVERSITY OF MICHIGAN MUSEUM OF ART has received a gift of Chinese calligraphy valued at more than $12 million.

The museum said the donation, the largest gift of art in its history, will transform its Asian art collection, adding an impressive breadth of works to its current collection of Chinese paintings and ceramics.

The Lo Chia-Lun Calligraphy Collection, donated by his daughter JiuFong Lo Chang and her husband Kuei-sheng Chang, preserves important evidence of cultural pursuits among notable historical figures, while also reflecting the tastes and intellectual exchanges among leading intellectuals in the early 20th century, UMMA said.

The collection includes Yuan and Ming dynasty calligraphy dating

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Editor-in-Chief Keith E. Crain Publisher KC Crain Group Publisher Jim Kirk, (312) 397-5503 or jkirk@crain.com Associate Publisher Lisa Rudy, (313) 446-6032 or lrudy@crain.com Executive Editor Kelley Root, (313) 446-0319 or kelley.root@crain.com Managing Editor Michael Lee, (313) 446-1630 or malee@crain.com Digital Editor for Audience Elizabeth Couch, (313) 446-0419 or elizabeth.couch@crain.com Creative Director Thomas J. Linden, tlinden@crain.com Digital Portfolio Manager Tim Simpson, (313) 446-6788 or tsimpson@crain.com Assistant Managing Editor Beth Reeber Valone, (313) 446-5875 or bvalone@crain.com Assistant Managing Editor Lauren Abdel-Razzaq, (313) 446-5800 or lauren.razzaq@crain.com Senior Editor Chad Livengood, (313) 446-1654 or clivengood@crain.com Special Projects Editor Amy Elliott Bragg, (313) 446-1646 or abragg@crain.com Associate Creative Director Karen Freese Zane, kfreese@crain.com Art Director Kayla Byler, kayla.byler@crain.com Design and Copy Editor Beth Jachman, (313) 446-0356 or bjachman@crain.com Research and Data Editor Sonya Hill, (313) 446-0402 or shill@crain.com Newsroom (313) 446-0329, FAX (313) 446-1687 TIP LINE (313) 446-6766

Lo Chia-Lun Family Photo | UNIVERSITY OF MICHIGAN MUSEUM OF ART

back to the 14th century, with master pieces done by Yang Wizhen (1296-1370) and many others.

It also represents a contribution to the study of Chinese cultural his-

tory, with pieces from many cultural leaders of the early 20th century, UMMA said.

Lo Chia-Lun (1897-1969) was a student leader in China’s “May

Fourth Movement” and became a prominent government official in Nationalist China, a scholar, calligrapher, poet and president of two major universities: National Central University and Tsinghua University.

The gift made in his honor builds upon earlier monetary and art donations from the family, which has deep ties to UM, UMMA said.

Lo Chia-Lun’s wife, Djang Weidjen, earned a Master’s in Political Science at UM in 1927 on a Barbour Scholarship, one of the university’s oldest and most prestigious awards.

The couple’s daughters, Jiu-Fong Lo Chang and Jiu-Hwa Lo Upshur also attended graduate school at UM as Barbour Scholars, and their son-in-law Kuei-sheng Chang earned a master’s degree and Ph.D. in geography from UM.

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