ZINGERMAN’S

at keeps with the ZCoB philosophy of each property as its own unique business.

Establishing a PPT is not common practice among businesses and it can be highly complex. Weinzweig said Zingerman’s worked with its attorney for years to get it right.

“Eventually, of course, Paul and I will be gone, but the purpose and spirit of the organization can now stay put,” Weinzweig said in an announcement about the ZPPT. “And the other great leaders who have already been actively and e ectively participating in running the (Zingerman’s Community of Businesses) so ably will continue on apace.” e move to a PPT is a form of succession planning for Weinzweig, 66, and Saginaw, 70. rough the trust, Zingerman’s ownership will over the next 20 years pay out larger portions of the pro ts earned from the company’s intellectual property to Community Share owners who are made up of sta who put $1,000 toward a share of the IP. Dividends are linked to pro tability. All 750 current employees in the ZCoB have the opportunity to purchase a share. at share will gradually increase over the next 20 years to give those shareholders more than half of the pro t from ZCoB’s intellectual property, according to Weinzweig. Half of the IP currently belongs to Weinzweig and Saginaw.

Each of ZCoB’s independent business are run by managing partners — Zingerman’s employees who developed unique business plans and followed a path to business ownership.

Zingerman's also founded Food Gatherers in 1988, an independent nonpro t food rescue and food bank in Ann Arbor. e majority of ZCoB's corporate giving has been directed toward alleviating hunger in Washtenaw County.

“We’ve been working on this for 10 years. We needed to come up with some legal, nancial succession planning,” Weinzweig said. “It allows the company to stay in business and not get sold o to some high bidder down the road. It frames the organization within the values we created many years ago that we continue to try to live by.

“It just seems like the right thing to do. e idea is to create growth and be a forest in the community. at’s not to say we’re so great, but if you pull Zingerman’s out of Ann Arbor you’ll feel the e ects. is allows Zingerman’s Community of Businesses to thrive for many decades after (Saginaw) and I are gone. We’re a big part of the community and we want to stay in the community.”

Saginaw, who now lives in Las Ve-

What is a Perpetual Purpose Trust?

A Perpetual Purpose Trust is a noncharitable trust established for the bene t of a purpose rather than a person. PPTs can prevent future owners from discarding pro-social policies in favor of higher pro ts. They also allow for various aspects of a company’s mission to be protected in the long term — such as pro t-sharing programs, supply chain practices, stakeholder inclusion in governance and more.

SOURCE: PURPOSE FOUNDATION gas and operates three businesses inside the Circa Resort & Casino there, said keeping the company small has been a personal choice.

“Certainly franchising or having a chain and bringing in private equity, or scaling up are proven business models,” he said. “ at just wasn’t what we wanted. It comes with a lot of problems. We wanted to be unique. For us being unique means that each of our businesses is unique. When you bring in a lot of money and big investments, that starts to dictate what you do. We wanted to share ownership with the people who work for us.” e ZCoB last year saw about $75 million in sales — up about $5 mil- lion from 2021 and about $25 million from 2020, when the COVID-19 pandemic hit businesses like Zingerman’s hard. Zingerman’s Community of Businesses generally sees modest sales growth each year — between 5 percent and 10 percent — according to Weinzweig. Saginaw projects Zingerman’s will see about $78.5 million in sales this year. at growth and emphasis on community is what attracted Joe Capuano to Zingerman’s in 2003. at year, Capuano joined Zingerman’s Mail Order in a seasonal holiday role. He’s now the purchasing manager for the business, a role he assumed in 2011.

Establishing the PPT comes as Zingerman’s continues to grow.

Capuano, 60, believes the implementation of the PPT is vital for ZCoB’s future.

“I’ve been reading about trusts for a while. ey’re kind of a remarkable thing,” he said. “I was really excited when I heard the company was working on that. For any company selling is always a possibility. You have new people come in who say they’re going to keep things the same, but then they change everything.

“ e trust gives the company the ability to keep the vision established by (Saginaw and Weinzweig). ere’s no expanding out of Ann Arbor, no duplicating any of the businesses. at’s what makes us special.”

Katie Frank, managing partner for business consulting company ZingTrain, called the establishment of the trust very generous.

“It’s a great way to transfer pro ts to the employees,” said the 45-yearold Frank, who has been with Zingerman’s for 17 years. “I think the company is set up well for the future. We’ll miss (Weinzweig and Saginaw) for sure. (Saginaw) has been out of his day-to-day role since 2020. (Weinzweig) hasn’t been in a day-to-day managing capacity for more than 20 years. at’s allowed the organization to grow. What we’re going to focus on is making sure to honor all the ways they’ve contributed to the business.” Saginaw may already have one foot out the door, but Weinzweig hasn’t decided when he’ll leave the business he helped start in March 1982.

Weinzweig continues to live in Ann Arbor and is frequently seen at the Roadhouse pouring water and chatting up diners or shopping at the deli.

“I’ll be around more than two years and less than 20,” Weinzweig said. “I’m not going anywhere. I’m having a good time. It’s amazing that we started with two employees. We were just a little corner store.

“In 1994, when we shared our vision for 2009, that’s when we described having a community of businesses — a family of businesses each with its own specialty. We’ll keep growing further. Slow and steady is kind of how we go.”

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

4 decades of Zingerman’s

Ann Arbor-based Zingerman’s is more than a deli. The Zingerman’s Community of Businesses is made up of a vareity of unique businesses run by managing partners.

Following are the businesses and when each opened:

Delicatessen: 1982

Bakehouse: 1992

Mail Order: 1993

ZingTrain: 1994

Catering: 1996

Creamery: 2001

Roadhouse restaurant: 2003 Co ee Company: 2003

Bake! cooking and baking classes: 2006

Candy Manufactory: 2009

Cornman Farms: 2014

Miss Kim restaurant: 2016

Greyline event venue: 2016 Food Tours: 2018

SOURCE: ZINGERMAN’S e plan to re-envision the neighborhood surrounding the century-old Henry Ford Hospital spans multiple blocks south of West Grand Boulevard on both sides of the John C. Lodge Freeway/M-10. It is being driven by a team-up of the Detroit-based health system, Gores and MSU, among other stakeholders. e new all-private-room hospital would be over 1 million square feet constructed across West Grand Boulevard from Henry Ford’s existing hospital; the existing Health Alliance Plan building at 2850 W. Grand Blvd. would be torn down to clear the way for it, which is expected to be similar in height to the 489-foot Fisher Building two blocks east, representatives from the heath system told Crain’s. e new tower will also include a larger emergency department, alleviating congestion in the existing hospital. e legacy hospital will remain in operation but with a smaller clinical footprint. A skywalk and a series of tunnels will connect the new structure and the existing hospital. e health system’s board of directors is expected to approve the plan later this month, the nonpro t told Crain’s. Construction on the new hospital and research center is expected to begin next year, with the former nishing in 2029 and the latter nishing in 2027.

“ is really is, to me, the gateway into the city. It’s also connected into the neighborhoods, so we are going to have an impact into the neighborhoods,” Detroit Pistons Vice Chairman Arn Tellem said.

As part of the overall redevelopment, Gores’ team would redevelop Henry Ford Health’s 610,000-squarefoot headquarters building, One Ford Place, between Second and ird avenues into a residential complex and construct a new mixed-use residential and retail complex on a surface parking lot sandwiched between that property and the Pistons Performance Center, where the team practices and has its corporate o ce.

In all, 550-plus residential units, including a ordable housing, are envisioned, and the repurposing of the o ce building would be perhaps the rst major conversion of such a property into residential space during the COVID-19 pandemic.

Bob Riney, president and CEO of HFH, and Tellem said the development is spun from the success of the health system and the Pistons partnering on the Performance Center, which includes a Plum Market and Planet Fitness, they built in 2019. Plus, vacating One Ford Place would harm the Performance Center across the street and the MSU research facility going in its parking lot.

“We de nitely didn’t want to leave that building (One Ford Place) abandoned,” Riney said. “All of a sudden Jupiter aligns with Mars. You’ve got our needs for the mission, you’ve got an incredible partnership that we have formed with the Pistons, who share the same values about Detroit and being part of the economic vitality (of the city). And then you bring in the education and research component from Michigan State to the table. All of a sudden you see, boy, three times three is going to equal 10 or 12.” e Gores portion of the project also includes nearly 2 acres of dedicated green space and basketball courts. e Pistons already have a presence in the neighborhood, with their practice facility and corporate headquarters sitting in the Henry Ford Pistons Performance Center, developed by Peter Cummings’ Detroit-based development rm, e Platform LLC, sitting at the corner of Second and York Street, a few blocks south of West Grand Boulevard. e new research institute, estimated at 300,000 square feet or more, would house researchers and physicians on translational research — speci cally looking at cancer, neuroscience, women’s health, imaging and public health. e institute was originally announced more than a year ago with a projected cost between $100 million and $150 million, each with HFH and MSU contributing $30 million for a total of 40 percent of the cost.

Construction on the commercial components would begin by the end of next year or early in 2025, Tellem said.

Henry Ford would also construct the already planned research facility with Michigan State University on an existing surface parking lot across ird Avenue from One Ford Place.

HFH wants to be a national player in the same conversation with the likes of Mayo Clinic, Johns Hopkins, Massachusetts General and Michigan Medicine. Hospital o cials said 12 months ago they believe their partnership with MSU can push the health system into that upper echelon of providers in the country.

Redeveloping the New Center neighborhood also allows HFH to boost its image to out-of-towners traveling to the area for medical procedures.

Dr. Adnan Munkarah, chief clinical o cer for HFH, said for HFH to be considered a world-class destination, its hospital must match its physicians’ capabilities.

“We’ve always had an academic hospital at Henry Ford Hospital in Detroit,” Munkarah said. “We’ve been innovators for over 100 years and there are many rst-in-theworld procedures and interventions that we’ve done here at Henry Ford. It’s extremely important for us to continue to advance our technology and create the hospital of the future.” e legacy hospital, for example, doesn’t have high enough ceilings to accommodate some of the modern technology required for an advanced health care setting. e entire campus, now ensconced between York and Holden Street to the south, Second Avenue to the east, Pallister Avenue to the north and Poe Avenue to the west, would be connected via pathways and pedestrian bridges over the Lodge Freeway. e existing hospital would continue to operate, but with fewer rooms and the building would likely house all or a portion of HFH employees currently working One Ford Place. Most clinical care would be moved to the new hospital, which is expected to be completed in 2029 with a groundbreaking in 2024. e HFH and MSU research facility is expected to open in 2027 after a concurrent groundbreaking with the new hospital. e project is not expected to add beds to the hospital system, which has 877 beds at its New Center hospital. e redevelopment is a long-standing plan held by HFH management, largely developed under former CEO Wright Lassiter. Mark Barnhill, partner at Platinum Equity and leader of Gores’ investments portfolio, told Crain’s Lassiter and Gores created the vision for the new district on the back of a napkin at dinner at the Townsend Hotel in downtown Birmingham. e CBO process — which voters approved in 2016 — requires that developers proposing development projects with a $75 million price tag receiving $1 million or more in property tax abatements or $1 million or more in city land engage with a Neighborhood Advisory Council to establish community bene ts. ose can include things like jobs, local hiring, environmental protections, land use programs and local small business and resident inclusion. e Rev. Charles Williams II of the Historic King Solomon Baptist Church of Detroit, about a mile to the southwest of the hospital site, said in a Wednesday statement that the developers haven’t consulted with the community on the overall vision.

Riney said the $2.2 billion portion health care portion of the project would be funded by capital investment and philanthropic fundraising. Some large donors are prepared to aid in the funding, he said.

Tellem and Riney acknowledged that public funding for the project will be sought, potentially including brown eld tax credits.

“It’s customary for all signi cant real estate projects to have some level of public nancing, and we’re gonna look at it and examine all the options as we put this project together,” Tellem said.

At least some portions of the project could be required to go through the city’s Community Bene ts Ordinance process; Riney said Henry Ford’s portion would at least adhere to “the principles” of the CBO.

Big plans, big partnership

What’s included in the vision of a newly announced team-up of Henry Ford Health, Detroit Pistons owner Tom Gores and Michigan State University targeting redevelopment of the New Center neighborhood surrounding Henry Ford Hospital.

1. New Henry Ford Hospital tower

Westgrandboulevard

2. Henry Ford Detroit Pistons Performance Center

3. Henry Ford Health Center for Athletic Medicine

4. One Ford Place Lofts (repurposed mixed-use residential)

5. Mixed use residential and retail

6. Parking structure

7. Henry Ford Health/ Michigan State University Research Facility

“ ese plans are laudable, and we are not anti-development or anti-progress,” the statement says. “But why would three large institutions make these kinds of plans without any consultation from the folks who are already in that community? I’m in my o ce at the church every day, and our doors open daily. Historic King Solomon Baptist Church has been in the community for over 70 years. We were removed from Detroit’s Black Bottom for a freeway; we will not be removed again. I’m curious as to how many tax incentives are needed. I’m curious how much more forcing out they plan on doing. Development without the community is called colonizing, and we will not stand for it.”

Riney told Crain’s that Henry Ford Health has “created the infrastructure” for community outreach but “wanted to wait til the announcement before going too far.”

“We’re gonna involve the community in a very signi cant way,” Riney said. “ ey’ll be walking through mock rooms, mock designs, having input on the design of rooms, the colors, the ow.”

Riney said the health system has assembled all of the property it needs

A rendering shows the health care-focused portion of Henry Ford’s project, with

CRAIN’S DETROIT BUSINESS for the projects over the past decade or so.

And Tellem said this vision, as well as future components to follow that have not yet been determined, will set the stage for a more walkable, dense area attractive to visitors and residents.

“ e city needs density,” Tellem said. “By putting the research center and by us building residential and green space and retail, and by having a bridge that we are building connecting this part of the campus over to the other side to strengthen and link this area, and with potential future development that will go on beyond just the hospital, I think is going to achieve that.” e unveiling comes as the Ilitches — whose Little Caesars Arena houses Gores’ Detroit Pistons — and billionaire mega-developer Stephen Ross have put forward more details of their broad e ort to build or redevelop 10 buildings totaling $1.5 billion in the District Detroit area, south of the Hen-