Crain's Detroit Business, Feb. 21, 2022 issue by Crain's Detroit Business

THE CONVERSATION: Nik Endrud on Forvia’s future. PAGE 22

TAKING OWNERSHIP Black business leaders on keeping money in community PAGE 8

CRAINSDETROIT.COM I FEBRUARY 21, 2022

UP FROM THE ASHES Challenges lie ahead in Oakland Hills’ quest to rebuild

Keeping them happy is key, said Rick Bayliss, former COO at Oakland Hills and president during the $16.25 million rehab of the club in 1999. “It’s just a gut punch, but the heart and soul of that facility has always been the people,” Bayliss said. Oakland Hills officials declined to speculate on cost and timeline for a rebuild, but Palmer said club management was preparing to make accommodations for members and staff. “First step is getting temporary offices for the administrative staff to make See OAKLAND HILLS on Page 20

NIC ANTAYA/SPECIAL TO CRAIN’S DETROIT BUSINESS

| BY KURT NAGL AND KIRK PINHO

WITH THE ICONIC CLUBHOUSE at Oakland Hills Country Club still smoldering after a devastating fire last week, club officials began plotting next steps for the century-old institution. Club President Rick Palmer said in no uncertain terms the clubhouse would be rebuilt. Club leaders vowed that Oakland Hills’ place in the history and future of golf would be preserved. The reality of a rebuild is several more years of disruption for its roughly 750 members, including community leaders, business executives and other affluent individuals who will ultimately decide the fate of the club.

xxxxxxxxxxxxx

Cannabis consumption lounges start to pop up

OFF TO THE RACES 2021 was a banner year for the Biggest Deals. 2022 may keep up the pace.

COVID and regulations have slowed rollout BY ANNALISE FRANK

` 2021 was a breakneck year for mergers and acquisitions —. the biggest deals were bigger, and there were more of them. See which were the biggest, and what 2022 holds for M&A, starting on Page 10.

GETTY IMAGES

` JOIN OUR WEBCAST: Go behind the scenes of a really big deal, buying businesses amid a pandemic and find out the 2022 forecast in our free webcast. Details on Page 13.

So you bought the joint. Where are you smoking it? There’s always your place, but you’ve been there for two straight years. The park? OK, but technically that’s illegal. Same with the bar down the street. Enter the consumption lounge. The first such businesses in Michigan will likely begin to open soon where patrons can openly consume cannabis, and judging by license application status, the first entrants

in the space are set to fire up in Hazel Park and Kalkaska. The state has allowed consumption lounge licenses, alongside retail, cultivation, transporting and other kinds of marijuana businesses, since recreational use sales officially began in late 2019. But businesses seeking license types that let people gather, including consumption lounges and temporary consumption events, have been slower to materialize, largely due to the COVID-19 pandemic. See CANNABIS on Page 19

NEWSPAPER

CLEANING UP

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NEED TO KNOW

ENERGY AND ENVIRONMENT

THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT ` SENATE PASSES CUTS IN PERSONAL, BUSINESS TAX RATE THE NEWS: Republicans who control the Michigan Senate on Tuesday passed a $2.5 billion annual tax cut, voting to lower income and corporate rates while letting people claim a credit for their children and deduct more retirement income. The step came less than a week after Democratic Gov. Gretchen Whitmer formally proposed less sweeping tax breaks for retirees and lower-wage earners. WHY IT MATTERS: Citing a multibillion-dollar budget surplus, Republicans said it is time to return money to people hurt by the pandemic and high inflation, and to keep the state’s business climate competitive. Whitmer said publicly the plan is not sustainable, signaling that she may be prepared to veto it.

`$1B IN FEDERAL MONEY AIMED AT GREAT LAKES CLEANUP THE NEWS: Long-delayed cleanup of Great Lakes harbors and tributary rivers fouled with industrial toxins will accelerate dramatically with a $1 billion boost from President Joe Biden’s infrastructure plan, senior administration officials say. WHY IT MATTERS: The infusion from the bipartisan measure enacted in November, combined with annual

funding through an ongoing recovery program, will enable agencies by 2030 to finish work on 22 sites designated a quarter-century ago as among the region’s most degraded, officials said Thursday.

` STATE SETS $121M AVAILABLE FOR AT-RISK HOME OWNERS THE NEWS: Michigan has made more than $121 million available to help stave off foreclosure for homeowners who have been negatively affected by the coronavirus pandemic. The Michigan Homeowner Assistance Fund, from federal American Rescue Plan Act dollars, is earmarked for homeowners who are behind on payments that leave them at risk for foreclosure. WHY IT MATTERS: The money is expected to help 13,000-15,000 Michigan homeowners stay in their houses, said Mary Townley, the director of homeownership for the Michigan State Housing Development Authority.

` HARBAUGH AGREES TO REWORKED 5-YEAR DEAL THE NEWS: University of Michigan

football coach Jim Harbaugh has agreed to a reworked five-year contract with the school that runs through the 2026 season. The announcement of a new deal came two weeks after Harbaugh interviewed to fill the head coaching vacancy with the Minnesota Vikings. Financial terms of Harbaugh’s new deal were not released by the school. WHY IT MATTERS: The move signals a recommitment by Harbaugh and the university and adds a year to his existing deal right after he took a look at the NFL job.

` GIRL SCOUT COOKIES HIT BY SUPPLY CHAIN ISSUES

Enbridge proceeds with Line 5 tunnel RFP ` A state board has given Enbridge Inc. the go-ahead to issue a request of proposals for construction of a $500 million tunnel under Lake Michigan that would house Enbridge’s controversial Line 5 oil pipeline. Mackinac Straits Corridor Authority approved Enbridge’s RFP for construction of a four-mile tunnel that still needs permits from the U.S. Army Corps of Engineers, the Michigan Department of Environment, Great Lakes and Energy and the Michigan Public Service Commission to become a reality. Construction of the tunnel is expected to take four years. Because of the timing of permits, Enbridge is now estimating construction could begin in 2024 and be complete by sometime in 2028. The RFP process is expected to take six months and will include bids for both construction of the tunnel and a tunnel boring machine that will bore out the bedrock for the underground passageway, Enbridge spokesman Ryan Duffy said.

THE NEWS: Pandemic-induced shortages have hit the Girl Scout Cookie supply chain. Girl Scouts of Southeastern Michigan said it has been informed by its licensed supplier, Little Brownie Bakers, that pandemic-related production issues have impacted cookie inventories this year. Despite the challenges, the council said it planned to sell cookies at booths out in the community this past weekend and in the future. It could not immediately be reached for comment late Tuesday. WHY IT MATTERS: The delays show even beloved, simple products are not immune to the supply chain problems that have beset industries around the world.

The Straits of Mackinac. | DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS

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248-644-7600 | KOJAIAN.COM 2 | CRAIN’S DETROIT BUSINESS | FEBRUARY 21, 2022

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REDEVELOPMENT

The old Cadillac Stamping Plant on Detroit’s east side was demolished last year and made way for a new Lear Corp. plant development. The site was among large industrial properties the city wanted redeveloped, and now Detroit is aiming to spend American Rescue Plan Act dollars readying more industrials sites for potential new use. | CITY OF DETROIT

CLEANUP OPERATION

Detroit ramps up plan to spend $95M of pandemic aid on commercial demolition, site preparation

BY ANNALISE FRANK

Photos from August 2021 and February 2022 show the result of commercial corridor cleanup and demolition work the city of Detroit is doing now and plans to expand using American Rescue Plan Act dollars. The city tore down a shed on a property at 8920 Mack Ave. | GOOGLE EARTH (TOP) AND ANNALISE FRANK/CRAIN’S DETROIT BUSINESS

The city of Detroit plans to spend $95 million over the course of four years or less getting rid of and/or improving vacant business structures across the city, using more than 10 percent of its federal COVID-19 pandemic recovery windfall on commercial blight remediation. The city has focused its blight-removal funding in recent years more on residential than commercial, using its $250 million in borrowing for the Proposal N program, which focuses on demolishing and reusing blighted single-family homes. Tear-

downs of vacant commercial buildings left by a sea of absentee business owners, population decline and changing economics had ground to a near Sherard-Freeman halt in 2020, other than emergencies. But with $826.7 million in American Rescue Plan Act dollars coming down the line, that’s changing. It’s not just about removal, but about preparing for the opportunities that come after, said Nicole She-

rard-Freeman, Detroit’s group executive of jobs, economy and Detroit at Work. “We know Detroit doesn’t have enough sites that are ready for industrial development,” Sherard-Freeman said. “We knew that before Ford (Motor Co.) made their decision to locate outside the state of Michigan (in Tennessee and Kentucky), but that really drove home the point ... Before the ARPA funding we didn’t have a way to consider getting started on the industrial land readiness the way we are now.” See DEMOLITION on Page 21

PEOPLE

What it was like to be a Black real estate broker in Detroit in the ’90s BY KIRK PINHO

Terence Edmondson and Charles Mady began their Detroit-based commercial real estate brokerage, Exclusive Realty, in 1994. Since then, Edmondson has done an array of deals in an ever-evolving commercial real estate landscape — and overcame a near-fatal battle with COVID-19 early in the global health pandemic, as the Michigan Chronicle detailed in June 2021. The Mumford High School graduate left Detroit to attend the Universi-

ty of Alabama, then moved back home to begin his career. He started in 1987 at what was then Coldwell Banker and within about six months received a promotion to head up management and leasing. From there, Edmondson has racked up not only deals, but market knowledge and, as he likes to say, not only clients, but friends. He spoke with Crain’s Detroit Business earlier this month. ` What is your favorite deal of your career?

The first deal I actually did. I picked up Crain’s that had the list of the top Blackowned companies and I started cold-calling the list. I got a client out of it who still remains my friend to this day, the Symcon Co. They let me represent them. That was my first major representation deal. ` Was it your favorite deal just because it was your first? Just because it was my first. I took the Book of Lists and started calling. I’m Black. It was a different time, to be honest. See BROKER on Page 20

Celebrating Black History Month: This profile is part of a series of conversations with Detroit-area Black entrepreneurs and business leaders about how they got their start. Visit crainsdetroit.com for more throughout the month of February.

Terence Edmondson of Exclusive Realty at his office in Detroit. | KIRK PINHO/CRAIN’S DETROIT BUSINESS FEBRUARY 21, 2022 | CRAIN’S DETROIT BUSINESS | 3

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REAL ESTATE INSIDER

REAL ESTATE

The Palms Apartments at 1001 E. Jefferson Ave. at Rivard Street in Detroit. | COSTAR GROUP INC.

Pair of historic Jefferson Avenue apartment Weighing fate of ‘gateway to north Troy’ buildings sell for $6 million A sign announcing a new development coming to north Troy advertises mixed use development to potential clients. | KIRK PINHO / CRAIN’S DETROIT BUSINESS

BY KIRK PINHO

Troy’s Big Beaver corridor is known for its sparkling office buildings, luxury shopping and restaurants galore. But what about two miles north? Kirk At the northwest PINHO corner of Long Lake and Crooks roads, Bloomfield Hills-based developer Kojaian Management Corp. is mulling the fate of a little over 24 acres of land it purchased from Kelley Services a few years ago. Calling the large property the “gateway to north Troy,” Tony Antone, executive vice president of the company run by developer C. Michael Kojaian, said it’s a bit too soon to tell what ultimately ends up on the property, but Kojaian is moving forward through the entitlement process in Troy to get the site shovel-ready. The developer was before the Planning Commission earlier this month to discuss what Kojaian Management ultimately hopes is a PUD, or planned unit development overlay, to be put in place for the site. Antone said the company is hoping for approval in spring, although any construction is quite some time off. “This is a long range plan,” Antone said. “Anyone that we’ve talked to about the site has been intrigued, but we’re not zoned for what they want yet. So they’re like, ‘Yeah, it’s kind of early, so let’s look at it when you get your entitlements.’ So it’s a little bit of a chicken and egg situation, but the city seems amenable to doing something special on this acreage, and we’ve done a lot of stuff in Troy, so we know the city and staff, what they like and don’t like.” The plans have been in the works for more than a year and have been covered by the Troy Times, a publication of Warren-based C & G Publishing. Kojaian, through affiliated entity Long Lake Crooks Development Associates LLC, ended up with the land following a May 2019 purchase from an affiliate of Troy-based Kelly Services Inc. for $12 million, according to city staff and land records. The property, which has never been developed, is flanked by hotel space as well as prime office buildings, including the Troy Corporate Center, the Flagstar Bank building, North Troy Corporate Park and Troy Tower. Some of the property that abuts the

The Jeffersonian Houze apartment tower at 9000 E. Jefferson Ave. along the Detroit River. | COSTAR GROUP INC.

site is owned by Kojaian Management. Concepts for the 24 or so acres abound, though, to be sure, ranging from hotel and apartment uses coupled with a large, 500,000-square-foot office building as a corporate headquarters. The fact that we’re still in the middle of a global pandemic and the hotel and office sectors have been battered for the last two years — in a conversation with Antone, I called it a “bloodbath” — isn’t lost on Antone, but he’s confident that eventually the uses will bear out, noting that the company wouldn’t build anything on the site without a user lined up. “Planning a piece like this, it’s not a tomorrow thing,” Antone said. “It takes time and we believe that it’s going to be prime for when the market does rebound. And yes, there’s a bloodbath going on in some of these sectors. But we’re already starting to see activity that folks are planning for post COVID.” Regardless of what shakes out, Kojaian has a large chunk of land in a key suburban location to play with. “There’s just so few parcels left like this that are fun to imagine and engage the professionals to help you kind of figure out, but it’s in the early stages,” Antone said.

Jeffersonian Houze auction postponed The lender on the troubled Jeffersonian Houze apartment tower in Detroit has decided to wait another month to auction off the 30-story high-rise. Documents filed in federal court on Feb. 11 say that lender Fannie Mae now

is planning to auction the property March 17 instead of Feb. 17 as originally planned. Liv RiverHouze LLC, which is controlled by Jeffersonian Houze co-owner, real estate developer and landlord Joe Barbat, filed a Feb. 4 request for a temporary restraining order attempting to halt the auction, saying it “will suffer irreparable harm” if the sale is not blocked. Fannie Mae argues against granting that TRO in its response motion. Barbat is one of the co-owners of the building along with Arie Leibovitz, another investor and developer. The two men have been battling in court for more than a year over the building. The 410-unit building at 9000 E. Jefferson Ave. has been under the oversight of Ronald Glass of B. Riley Financial Inc. since the summer after lender Fannie Mae requested a receiver in April.

A pair of historic Jefferson Avenue apartment buildings sold for $6 million last month. Bloomfield Township-based multifamily landlord Princeton Enterprises sold The Palms Apartments at 1001 E. Jefferson Ave. at Rivard for $4.2 million and the Manchester Apartments at 2016 E. Jefferson Ave. at St. Aubin for $1.8 million to an unknown buyer, according to city property sales records. The east Jefferson corridor has been active with commercial real estate activity the last several months following the opening of the Rivertown Market by Meijer Inc. and ramped-up spending by billionaire Dan Gilbert in the area. Among the movement: Listings of various properties, including a portfolio owned by a Birmingham investor as well as Detroit’s first high-rise apartment building, the Pasadena Apartments, and building demolitions, clearing the way for new development on now forsale vacant land. The Palms Apartments, designed by Albert Kahn, is significant as it is one of the first buildings in the world to use reinforced concrete in its construction, according to a Detroit City Council report drafted as part of the creation of the local Palms Apartments historic district. The Manchester Apartments, added to the National Register of Historic Places in 1985, “represents the trend towards the transition of Jefferson Avenue from an upper class residential avenue to a middle class area and later a commercial

strip,” a report on the property from that year says. The exterior of the building was also shown in the eighth episode of the first season of HBO’s “The Sopranos.” An email was sent to Matt Lester, head of Princeton Enterprises, seeking comment Wednesday morning. According to CoStar Group Inc., a Washington, D.C.-based real estate information service, the Palms Apartments building was constructed in 1910 and currently has 64 units — 17 studios renting for an average of $801 per month, 38 one-bedrooms renting for an average of $1,001 per month and nine two-bedrooms renting for an average of $1,302 per month. Princeton paid $3.05 million for the property in February 2014. CoStar says the 35-unit Manchester Apartments was constructed in 1915 and has 32 one-bedroom units renting for $804 per month and three two-bedroom units renting for $819 per month. Princeton paid $660,000 for the property in November 2014, according to CoStar. The entities that purchased the buildings last month — 1001 Jefferson LLC and 2016 Jefferson LLC — are connected to Detroit-based real estate firm Greatwater Opportunity Capital LLC. Peter Jankowski, senior vice president of brokerage services for Farmington Hills-based Friedman Real Estate, represented both the seller and buyer in the deal. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

Ilitches confirm JoJo’s Shake Bar coming My colleague Jay Davis and I reported on Jan. 24 that JoJo’s Shake Bar was opening a location in the Ilitch family’s District Detroit area. While the Ilitch family’s Olympia Development of Michigan real estate company did not respond to our request for comment at the time, the company recently confirmed that the Chicago-area restaurant known for its elaborate milkshakes is coming to town. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

The Manchester Apartments at 2016 E. Jefferson Ave. at St. Aubin has 35 apartments. | COSTAR GROUP INC.

4 | CRAIN’S DETROIT BUSINESS | FEBRUARY 21, 2022

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How we’re boosting the fight against hunger Bank of America is proudly supporting our employees’ health and safety and addressing one of our local community’s most critical needs. Each day, millions of Americans suffer from food insecurity, which typically spikes during the winter months. For every employee who lets us know they’ve received a booster shot, Bank of America is donating $100 to local hunger-relief organizations. This is a direct investment in the health of our teammates, and in the well-being of the communities where we work and live. Through this effort, our team in Detroit recently presented Forgotten Harvest and Gleaners Community Food Bank with checks totaling $100,000. This contribution is in addition to our long-standing philanthropic support to help fight hunger and food insecurity across the country. We are proud to be able to help our community as we work together to move forward.

Matt Elliott President, Bank of America Detroit

Learn more at bankofamerica.com/detroit

Donations in each market reflect $100 per employee who has recorded their booster and an additional company contribution. Vaccination boosters and vaccination reporting are voluntary. Bank of America, N.A. Member FDIC. Equal Credit Opportunity Lender. © 2022 Bank of America Corporation. All rights reserved.

COMMENTARY

Governor’s budget skips long-term debt reduction

The Gordie Howe International Bridge is under construction in southwest Detroit’s Delray neighborhood. The six-lane bridge is expected to be completed by late 2024.

COMMENTARY

Blockade is a big ‘I-told-youso’ for Howe Bridge backers

om Shields shook his head from his vacation home in Florida watching a national TV news report showing trucks blocking all traffic on the Ambassador Bridge. Shields, a semi-retired political consultant and former owner of Marketing Resource Group Inc. in Lansing, spent years advocating for the construction of a second bridge over the Detroit River. “The first thing I thought is we would have had that redundancy by now had the plans (to build a second bridge) not been delayed as much as they were,” Shields said. There were a lot of folks in Michigan’s economic development and political circles privately saying “I told you so” as they watched international truck traffic grind to a halt at the Ambassador Bridge at the hands of a ragtag group of protesters, whose demonstrations upended a pandemic-disrupted supply chain for everything from six-cylinder engines to fresh flowers. The so-called EFFORTS TO GET “Freedom Convoy” blockade of the MICHIGAN bridge reinforced a LEGISLATORS TO decades-old argument that it’s downAPPROVE ONE right dangerous to have just one bridge DIME FOR A over the Detroit River SECOND SPAN connecting the entangled economies of HAVE BEEN Michigan and OntarSTYMIED FOR io. “If there were ever TWO DECADES. something that would demonstrate in real time the importance of that second bridge, it’s this,” said former Lt. Gov. Brian Calley, now the CEO of the Small Business Association of Michigan. “We are living on borrowed time by having a single crossing that carries so much of that integrated manufacturing supply chain on a daily basis.”

Chad

LIVENGOOD

Redundancy in border crossings — like the four bridges New York has in the Buffalo and Niagara Falls region — were the central argument in Lansing for a second bridge, dating back to the 1990s (the Detroit-Windsor Tunnel is not tall enough for most commercial trucks and largely limited to passenger vehicles). Proponents of a new bridge have long argued that Huron Church Road in Windsor and its half-dozen stop lights along a city street leading up to the 93-year-old Ambassador Bridge are inefficient for a modern international border crossing with 7,000 trucks carrying some $700 million in goods both ways each day. But efforts to get Michigan legislators to approve one dime for a second span connected to modern freeways in Michigan and Ontario have been stymied for two decades, in part because of fierce lobbying and generous campaign donations from the family of the late bridge owner Manuel “Matty” Moroun. The Morouns have been masterful in convincing just enough legislators that the fourlane Ambassador Bridge should be twinned with a second span connecting to the same existing infrastructure that protesters shut down with a half-dozen semi trucks and a few passenger vehicles. “We certainly weren’t exaggerating — it doesn’t take much to shut down that bridge,” Shields said. “But it wasn’t as convincing as the money Matty Moroun was donating.”

hen I got my first glimpse of Gov. Gretchen Whitmer’s $74 billion fiscal 2023 spending proposal last week, I was reminded of some advice my grandmother shared during many a Thanksgiving dinner — make Craig Thiel is research director sure you have a balanced mix of offerings on your at Citizens plate. Research Faced with a bounty of Council of my favorite holiday foods, Michigan. my inclination often was to pile up on all the items I liked, leaving little room for anything else. Balance is just as important when it comes to government finances. In this vein, the governor’s budget plate is overflowing with new and varied spending proposals with a small portion of tax relief sprinkled on top, but it does not include a serving of long-term debt relief. This is unfortunate because Michigan state government is in an historically unique fiscal position to offer taxpayers a healthy serving of debt relief AND increase investments in critical state priorities. That is because of the massive budget surplus the state is currently sitting on. As we noted previously, the current-year budgets for general state government operations (General Fund) and education programs (School Aid Fund) are flush and currently looking at a combined projected year-end surplus of nearly $7.0 billion that will remain available in FY2023. The surplus effectively represents onetime funding, so tapping these dollars to finance permanent, ongoing programs runs the risk of creating structural imbalance once the money runs out. These one-time resources should most appropriately be directed toward one-time purposes whether that is to finance additional one-time government spending, provide temporary tax relief, or pay down a portion of the state’s long-term debt. We were glad to see that Whitmer’s budget proposals largely take this approach and, importantly, maintain a structural balance between ongoing revenues and spending. However, the governor’s plan to use the $3.6

See LIVENGOOD on Page 18

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.

billion School Aid Fund surplus skews entirely toward spending and misses an opportunity to pay down some of the state’s largest and most expensive debts. Major spending items include $1.5 billion for teacher and school employee retention bonuses over the next four years and $1 billion for building and infrastructure capital improvements across Michigan’s traditional public schools (charter schools are excluded). Because the state has not saved enough to meet retirement obligations in past years, it has made public school employees its largest creditors and amassed massive unfunded liabilities in the school pension system. These liabilities are effectively state-issued IOUs for services already rendered by teachers and other school employees. Michigan taxpayers owe the Michigan Public School Employees Retirement System’s or MPSERS retirees and current workers $33.8 billion more than the state has saved to finance promised pension benefits. Making an additional debt payment today would save both districts and the state money over the long term. Using a portion of the $3.6 billion School Aid Fund surplus dollars for a sizable, onetime principal payment will save interest costs over the remaining term of the debt, freeing up this money to re-invest in classrooms in future years. This works much like the interest savings a homeowner realizes when she makes an additional principal payment on a home mortgage. There are no easy alternatives for retiring MPSERS debt other than to put additional cash into the system to pay what has been promised already. And, there is precedent for doing so; in 2018 the state used $200 million in surplus budget funds to make an additional principal payment. At that time, the School Aid Fund surplus was not even close to today’s projected $3.6 billion. The financial benefits for paying down pension debt early will not accrue until years in the future when the interest savings can be redirected to classroom operations. As such, there is no organized constituency today to advocate for doing so, which may explain why the governor’s budget request passes on spending surplus funds to pay down MPSERS liabilities. A more balanced budget proposal would consider the financial benefits accruing to Michigan’s future school children from debt relief today.

GETTY IMAGES/ISTOCKPHOTO

WINDSOR-DETROIT BRIDGE AUTHORITY

BY CRAIG THIEL

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.

6 | CRAIN’S DETROIT BUSINESS | FEBRUARY 21, 2022

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OTHER VOICES

Legislature must seize the moment on governor’s budget

Ora Hirsch Pescovitz is president of Oakland University.

Gov. Gretchen Whitmer and the Legislature face a stark and historic moment. Before them is a oncein-a-lifetime opportunity to fundamentally transform Michigan through investments that will become the building blocks of the state’s future

prosperity. The governor’s proposed $74.1 billion budget addresses the persistent needs of Michigan residents, and, if enacted, offers significant investments in schools, health care, infrastructure, business and workforce development, and higher education. Higher-than-expected tax revenues due, in large part, to Michigan’s thriving manufacturing sector and automotive industry, and an influx of federal aid from the American Rescue Plan, have created the opportunity for a bipartisan, collaborative and strategic approach. Among the inspired tactics taken by the governor in the proposed budget is the historic per pupil investment into K-12, incentives to attract and retain teachers, expanding mental health services, strengthening school safety, and a 5 percent base increase along with an additional one-time 5 percent increase to public universities.

AS MICHIGAN FACES A NEW REALITY, IT’S TIME TO STEP UP TO THE CHALLENGE AND CREATE THE BUILDING BLOCKS FOR OUR FUTURE. The additional state funds come at a time when most universities in Michigan face declining enrollment, and increasing operating costs. In addition, the governor’s proposed $200 million disbursement to cover costs for improvements to infrastructure, technology, equipment and maintenance offer timely assistance for universities struggling to come up with money for campus upgrades amid rising inflation. Furthermore, increasing state funds to universities bolsters the state’s economic development and private-investment prospects. In the intensely competitive global economy, the decisive advantage for businesses is “mind power.” In other words, for businesses to thrive, and locate in Michigan, there must be an attractive talent pool. Michigan’s universities have proven to be the indisputable talent pipeline for the state’s bedrock companies and small-business community. The return on the investment in higher education is impressive. At Oakland University, for instance, about 97 percent of employed graduates work in Michigan. Simply put, college grads from the state’s colleges and universities are the backbone of the state economy. A prime example of how higher education is responsive to the needs of residents is the way universities are addressing the health care worker shortage. At Oakland and other universities, intense planning and

GETTY IMAGES/ISTOCKPHOTO

BY ORA HIRSCH PESCOVITZ

student recruitment strategies are underway to graduate more health care workers in medicine, nursing, physical therapy and other health sciences fields. As businesses respond to ways to become more sustainable and envi-

ronmentally responsible, college graduates will play a greater and greater role in shaping the state’s economy. Michigan’s automotive industry is making unprecedented investments into electric vehicles and autonomous technologies. The state’s

college graduates in engineering and IT will be at the vanguard defining the new chapter in transportation. In the days prior to the pandemic two years ago, Oakland University led a statewide appeal for the legislature to increase state allocations to public universities. The campaign, entitled “Strive for 45,” asked the governor and legislators to create an equitable funding formula so all public universities would benefit by raising the minimum funding per student to $4,500. If enacted, the governor’s proposed budget would achieve the campaign’s objective over the next four years, improving equitable funding for Oakland University,

Grand Valley State University, Saginaw Valley State University, UM-Flint and UM-Dearborn. For more than a decade, Michigan’s budgetary struggles have reduced and limited the state investments in higher education. Enacting the governor’s budget sends a resounding message that Michigan is on the rise and committed to higher education, moving away from its infamous status as a state with one of the nation’s lowest budgetary allocations to public universities and colleges. As Michigan faces a new reality, it’s time to step up to the challenge and create the building blocks for our future.

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SMALL BUSINESS SPOTLIGHT

Black family-owned business owners on keeping money within the community

TAKING OWNERSHIP Jay

DAVIS

The family business wasn’t passed down to Domonique Bowen. She sought control of it for a specific reason. “The business was strong from the time it opened until the early 2000s,” said Bowen, whose grandmother opened Chita’s Nefertiti Bar & Grill in 1994 on Detroit’s northwest side. “Then I saw my grandma hit a rough patch. I asked her what I could do to help, but I was young and she didn’t want to accept a lot of my ideas. I started to realize I didn’t want the business to fail.” Bowen, 33, is one of many Black business owners working to build on what was established by a prior generation. The reasons are many, including continuing a legacy and proving to future generations that Black families can position their families for long-term prosperity.

Bowen, who used $10,000 of her own money, took over the 1,110-square-foot bar named after her grandmother, Conchita Leigh, in 2013. Prior to the change in ownership, Chita’s operated as cash-only and employees were paid under the table. Armed with a degree in business management, Bowen implemented credit card machines and payroll for a staff of six. Bowen said she didn’t take a paycheck for the first five years she owned the business.

Leveling playing field In the United States, there are an estimated 134,567 Black-owned businesses, with $133.7 billion in annual receipts, 1.3 million employees and about $40.5 billion in annual payroll, according to U.S. Census Bureau data released in October on Black, Indigenous and People of Color OR BIPOC-owned businesses.

Those figures put Black Americans, which make up 13.4 percent of the U.S. population, third behind Asian American owned businesses (581,200, or 5.9 percent of the U.S. population) and Hispanic-owned (346,836, or 18.5 percent). James Mays, president of Detroit-based Mays Multimedia, believes lack of succession planning has hurt Black-owned businesses. Mays, whose father J. Caulton Mays established the company in 1946, believes showing children early the benefits of business ownership is vital to long-term success. “Black business owners have to look at owning a business like playing Monopoly,” said Mays, whose multimedia printing and publishing company employs a staff of 20. “Your goal is to go around the board. What a lot of Black-owned businesses do, they go so far around See OWNERSHIP on Page 9

PODCAST | ONLINE ` A Detroit business owner shares her story of taking over a family business and why it’s important to build on a legacy. Listen at crainsdetroit.com/ podcasts.

James May and his daughter, Elizabeth now lead Detroit-based printing and publishing company Mays Multimedia, established in 1946 by James’ father, J. Caulton Mays.

“My grandmother planted the seed and I want to sow it to a different level,” said Domonique Bowen, who took over Chita’s Nefertiti Bar & Grill in Detroit in 2013. NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

KEEPING A LEGACY ALIVE The number of legacy, Black-owned businesses is growing but there are still issues that can lead to the business faltering or dying when the first-generation owner retires or passes away. Following are some tips for Black owners who would like their business to continue for future generations: Estate planning: Every business should have a plan to continue in the absence of its leader. That leader should also make family members aware of how the business should be run in the event they retire or die. Insure yourself: Billions of dollars a year are paid by insurance companies and less than 3 percent of that money goes to Black business owners. If Black business owners are insured upon their departure, the business and family will have some support in order for the business to continue. Money matters: Future generations need a healthy understanding of credit, investing and taking advantage of the time value of money. Black-owned businesses that invest generally have better credit, which in turn gives them greater access to loans when needed, particularly when it's time to grow a business. SOURCE: FRED AIKENS, CENTRAL STATE UNIVERSITY

READ ALL OF CRAIN’S SBS PROFILES AT CRAINSDETROIT.COM/SMALLBUSINESSSPOTLIGHT 8 | CRAIN’S DETROIT BUSINESS | FEBRUARY 21, 2022

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FOCUS | SMALL BUSINESS SPOTLIGHT

OWNERSHIP

From Page 8

the board, and when the owner dies or retires, everything stops. The next generation that takes over has to start over. “The No. 1 thing that has to happen is the business owners, the first generation, have to show their kids the way and explain to them how the business supports the family, and that it can support their family.” That perspective comes from Mays’ father, one of two Black printers in the city when he launched his business. Mays Printing originally operated out of the city’s Black Bottom and Paradise Valley neighborhoods. James Mays became company vice president in 1977 upon graduating from Western Michigan University, then president in 2006 after his father died. His tenure with the company started at a young age, though, when as a 6-year-old he would visit his father’s business daily before school to sweep floors, sort paper and perform other odd jobs. Mays took the same approach with his daughter, Elizabeth. She got her start at 11 working as a janitor before school. Following her freshman year at Western, Elizabeth interned at Mays as a customer service representative, handling order intake and printing orders. When she finished college in 2011, Elizabeth moved back home to pursue a career in the family business and is now in her 11th year as CEO. “I wasn’t thinking about it initially,” Elizabeth Mays said, “but seeing how this company has done so much for so many people, I thought it was something I wanted to be a part of long term.”

Making up for an inequitable system Taking a role in the family business can help Black children who might otherwise get lost in the shuffle, according to Fred Aikens, who has more than 25 years exAikens perience in management at companies including Taco Bell, KFC and YUM Brands Inc. Aikens believes Black families are lagging in creating generational wealth and business ownership because of an unequal distribution of resources. “Suffice it to say that Black people in the U.S. suffer from more socioeconomic disparities than any other ethnic group in the country, and it’s institutional racism that allows it to happen,” said Aikens, associate professor of management at Central State University, a Historically Black College and University in Ohio. “A solution is to fix the education system and afford children from Black communities the opportunity to level the playing field.” James Mays and his family have worked to level that playing field, sharing knowledge with other Black entrepreneurs. “We’ve empowered people because we knew we couldn’t print everything in Detroit,” said Mays, who estimates his company at one point took on upward of 100 printing jobs a week. “We’ve trained people, giving scholarship money to Ferris State University and Western Michigan University for students to earn degrees in printing. We were, at one time, the training ground when the white-owned companies wouldn’t hire Black pressmen.”

On our own One major reason first-generation Black business owners push to get future generations involved is to give them the opportunity to work for themselves and with less capital that one may think. Hardware Express, at 18450 Grand River Ave. on Detroit’s northwest side, is run by father-son team Milton and Javari Tinnon. The pair, along with two employees, are the whole staff of the store, which opened in 2011. Javari Tinnon purchased the space in 2011 after a fire that destroyed another hardware store owned by Milton a mile away. Milton Tinnon has owned hardware stores for as long as Javari can remember, and he didn’t want that hard work to end with the blaze. The current Hardware Express operates out of a 2,200-square-foot space, about five times smaller than a previous store. “I thought that at this size, I could run the store alone,” said Javari, who began working with his father at 14. “One thing my father has taught me is that, as a business owner, it’s hard to depend on anybody else. Our staff has always been very small, but very knowledgeable.” Like Mays, Tinnon is pushing the next generation to take a long, hard look at entrepreneurship. His 14-yearold daughter works weekends as a cashier at Hardware Express. “It’s disappointing because so many Black people haven’t been taught through example,” Tinnon said. “Our children, Black children, need to know that they can do and be whatever they want to be. If hardware isn’t (my daughter’s) thing, I understand. But the things I’m trying to show her could put her on a path of entrepreneurship in another area.” Bowen, the bar owner, sees entrepreneurship as a way to teach the next generation a different mindset. While college is useful, it’s not the only avenue to success. “It’s hard, I’ll admit. There are days I get two hours of sleep,” Bowen said. “But I always knew I wanted to own something, I just didn’t know it’d be the family bar. “Myself as a Black woman in the community I’m in, by expanding, I can offer more jobs and show more people this can be done. We don’t get a blueprint for this. Everything is trial and error. I’m absorbing so much and passing things on to different people — how to handle accounting, payroll taxes, dealing with the city as far as various paperwork and permits needed.” Mays, who teaches a course on entrepreneurship at Wayne County Community College District, admires the likes of Bowen and Tinnon. The younger generation needs to take ownership of its community, he said. “We’re watching everybody else get on the field and making money,” Mays said. “But I understand that can’t change unless people help and empower others. I had mentors: Don Barden, Mel Farr, Don Davis. They had a commitment to give Black businesses the funding they needed. They empowered people, made millionaires. We can’t deprive ourselves, as Black people, of all the money that’s out here.”

Improvements Part of the reason for that disparity, Aikens said, is lack of access to capital, which he refers to as the systemic financial exclusion of people of color. “There is some movement, though, in the banking industry to recognize the need for urban development in op-

Detroit resident Javari Tinnon opened Hardware Express in 2011 with his father, Milton. Milton has owned hardware stores for most of Javari’s life, which set Javari on the road to entrepreneurship. | JAY DAVIS/CRAIN’S DETROIT BUSINESS

pressed areas,” Aikens said. “Since the 2020 protests and the George Floyd murder, banks like Wells Fargo, Union Savings Bank and a few others have increased lending offered to Black homeowners and entrepreneurs.” There may not be as many Black entrepreneurs as Mays would like, but Black-owned businesses are a major

part of Detroit commerce. An August 2021 Detroit Regional Chamber report found there were 33,000 Black-owned businesses in the city, and about 44,000 in the state. Programs such as Motor City Match offer entrepreneurs assistance in getting their businesses off the ground. Of the first 130 Motor City Match cash grant

winners, 80 percent are Black owned, with 64 percent being run by Detroit residents. The program has awarded $8.6 million in grants since 2015. The U.S. Small Business Administration also offers programs for small business owners, and is one of the best resources for entrepreneurs, according to Aikens. JP Morgan Chase is also investing in the city and its entrepreneurs. Neither Bowen nor Javari Tinnon sought out grants to establish their businesses, but believe the programs are helping level the playing field. “I think having more Black entrepreneurs and business owners gives us a chance to keep dollars rotating through our community like a lot of other races do,” Tinnon said. Bowen is proud of what her grandmother started and that she’s able to take the business to the next level. Last year, she purchased the building, its parking lot and a neighboring building for an undisclosed price. Bowen is planning to move Chita’s to the adjoining 5,200-square-foot space with a grand opening this summer. The current Chita’s space will become a new entity, she said. The move will create an additional 18-24 jobs. “It kind of goes to show how mindsets and trajectory change when you have more information,” Bowen said. “I don’t think my grandmother thought past paying rent, when the space could have been purchased and she could’ve been a taxpayer bringing more revenue into the bar. Now I don’t have to worry about anybody kicking me out for any reason. “... I see a lot through my mother’s eyes, and she knew how much my grandmother loved this bar. To see the changes happening, it’s great. I want more people, more Black people, to know this can be done.” Contact: jason.davis@crain.com (313) 446-1612; @JayDavis_1981

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FEBRUARY 21, 2022 | CRAIN’S DETROIT BUSINESS | 9

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THE LIST See the Crain’s list of the largest mergers and acquisitions of 2021.

BIGGEST DEALS

PAGES 11-12

CAN’T SLOW DOWN

GETTY IMAGES/ISTOCKPHOTO

M&A deals reach fever pitch in 2021, and that pace is likely to continue

“THE EXPERTS (WHO) GATHER A LOT OF THE DATA, I THINK PEOPLE REALLY BELIEVE THAT IT’S IN THE SECOND OR THIRD INNING OF THE PRIVATE EQUITY SUPERCYCLE.”

`BY NICK MANES AND KURT NAGL 2021 set records for the M&A sector — and by all in-

dications, nearly three months into 2022 — there appears to be little change in appetite for corporate dealmaking. Even with interest rates increasing and therefore debt being more expensive, the overall dynamics that have contributed to a flurry of mergers and acquisitions are all but assured to continue, according to M&A practitioners. All told, global M&A activity hit a record $5 trillion last year, according to a December Reuters report. That tracks with local deal values in 2021, which greatly outpaced the prior year. The combined transaction value of the top 40 deals on Crain’s list for 2021 was around $62 billion, more than double the combined value of the top 40 on the 2020 list. UWM Holdings Corp.’s $18.1 billion SPAC deal to go public, far and away the largest on the 2021 list, goosed the combined deals value a bit, but even so, the number of big deals in 2021 was significantly higher, too. In 2021, there were 16 deals that cracked $1 billion. In 2020, there were just seven. For executives at private equity firms like Huron Capital in Detroit, the start of a new year meant little more than a week in early January to catch their breath before picking up right where they left off, said James Mahoney, managing partner at the firm. See DEALS on Page 13

— James Mahoney, managing partner, Huron Capital

THE TOP 5 The biggest mergers and acquisitions in Michigan for 2021: `Pontiac-based United Wholesale Mortgage sealed a reverse merger with the “blank check” special purpose acquisition company Gores Holdings IV in a deal that put UWM on the Nasdaq and created a company valued at more than $18 billion. ` Ann Arbor-based ProQuest Inc., an information company that has roots going back to university microfilm collections, was acquired by U.K.-based data company Clarivate plc in a $5.3 billion deal.

` Novi-based Dexco Global Inc., which makes components for trailers, RVs and towable equipment, was bought by private equity firm Brookfield Business Partners L.P. (NYSE:BBU) and other institutional investors for $3.4 billion. ` Holcim Participations Inc. of Dundee acquired Indianapolis-based Firestone Building Products Co. for $3.4 billion. ` Traverse City-based Hagerty Inc., which writes specialty insurance for classic cars, boats and other vehicles, went public through a SPAC deal that valued the company at $2.9 billion.

10 | CRAIN’S DETROIT BUSINESS | FEBRUARY 21, 2022

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CRAIN'S LIST | MERGERS & ACQUISITIONS IN 2021 Ranked by value of transaction ACQUIRER NAME

TARGET

UWM HOLDINGS CORP.

GORES HOLDINGS IV INC. Goldman Sachs & Co. LLC Pontiac

(Financial Advisor); Greenberg Traurig LLP (Legal Advisor)

CLARIVATE PLC

PROQUEST LLC

Pontiac

London, Greater London, United Ann Arbor Kingdom

ACQUIRER ADVISERS

VALUE OF TRANSACTION ($000,000)

TARGET/SELLER ADVISERS

DATE

DESCRIPTION

Deutsche Bank Securities and Morgan Stanley & Co. LLC (Financial Advisor, lead capital market advisor and exclusive private placement agent); Moelis & Company LLC (Financial Advisor)

Closed Jan. 2021

Sold by: Gores Holdings IV Inc.. Pontiac mortgage lender United Wholesale Mortgage Corp. (NYSE:UWMC) went public in January of 2021 via a reverse merger with a 'blank check' company sponsored by billionaire investor Alec Gores. The company went public at a valuation of more than $16 billion.

$18,113.2

Evercore Inc. (NYSE:EVR) (Financial Fried, Frank, Harris, Shriver & Advisor); Davis Polk & Wardwell Jacobson LLP (Legal Advisor); LLP (Legal Advisor) Goldman Sachs & Co. LLC (Financial Advisor); Morgan Stanley & Co. LLC (Financial Advisor); UBS Investment Bank, Americas (Financial Advisor)

Closed May 2021

Sold by: Cambridge Information Group Inc.; Goldman Sachs Private Equity Group; Atairos Management LP. Clarivate Plc entered into a definitive

$5,323.8

Closed Jan. 2021

Sold by: Bridgestone Americas Inc.. Holcim

$3,400.0

Sold by: KPS Capital Partners LP. Brookfield Business Partners LP (NYSE:BBU) together with institutional partners entered into a definitive agreement to acquire a majority stake in DexKo Global Inc. from KPS Capital Partners LP for $3.4 billion on July 5, 2021.

$3,400.0

Sold by: FG Financial Group Inc. Aldel LLC; Aldel

$2,937.5

agreement to acquire ProQuest LLC from Cambridge Information Group Inc., Atairos Management LP, Goldman Sachs Private Equity Group and others for $5.3 billion on May 15, 2021.

HOLCIM PARTICIPATIONS (US) INC.

FIRESTONE BUILDING PRODUCTS CO. LLC

BROOKFIELD BUSINESS PARTNERS LP

DEXKO GLOBAL INC.

Davis Polk & Wardwell LLP (Legal Advisor)

Credit Suisse Group AG (SWX:CSGN) Closed (Financial Advisor); Goldman Sachs & July 2021 Co. LLC (Financial Advisor); Paul, Weiss, Rifkind, Wharton & Garrison LLP (Legal Advisor); J.P. Morgan Securities LLC (Financial Advisor)

HAGERTY INC.

ALDEL FINANCIAL INC.

Sidley Austin LLP (Legal Advisor); J.P. Morgan Securities LLC (Financial Advisor)

Loeb & Loeb LLP (Legal Advisor); Closed Continental Stock Transfer & Trust Aug. 2021 Company (Transfer Agent/Registrar); Alliance Advisors LLC (Information Agent); Advantage Proxy Inc. (Information Agent); ThinkEquity, a division of Fordham Financial Management Inc.; Global Leisure Partners LLC (Financial Advisor); ThinkEquity (capital markets advisor)

NEW YORK COMMUNITY BANCORP INC.

FLAGSTAR BANCORP INC.

Goldman Sachs & Co. LLC (Fairness Opinion Provider); Goldman Sachs & Co. LLC (Financial Advisor); Sullivan & Cromwell LLP (Legal Advisor); Piper Sandler & Co. (Fairness Opinion Provider); Piper Sandler & Co. (Financial Advisor); Equiniti (US) Services LLC (Information Agent)

Skadden, Arps, Slate, Meagher & Flom LLP (Legal Advisor); Jefferies LLC (Fairness Opinion Provider); Jefferies LLC (Financial Advisor); Morgan Stanley & Co. LLC (Fairness Opinion Provider); Morgan Stanley & Co. LLC (Financial Advisor); Equiniti (US) Services LLC (Information Agent)

Announced New York Community Bancorp Inc. (NYSE:NYCB) made a nonApril 2021 binding proposal to acquire Flagstar Bancorp Inc. for $2.6 billion on March 8, 2021.

$2,586.5

THE GOLDMAN SACHS GROUP INC.

CREDIT-CARD BUSINESS OF GENERAL MOTORS

Shearman & Sterling LLP (Legal Advisor)

Announced Sold by: General Motors Company (NYSE:GM). The Jan. 2021 Goldman Sachs Group Inc. signed an agreement to acquire creditcard business from General Motors Co. for $2.5 billion in October 2020. Daniel Litowitz of Shearman & Sterling LLP acted as legal advisor to Goldman.

$2,500.0

ROCKWELL AUTOMATION PLEX SYSTEMS INC. Troy INC.

Morgan Stanley (NYSE:MS) (Financial Advisor)

Barclays Capital Inc. (Financial Advisor);Paul Hastings LLP (Legal Advisor); Goldman Sachs & Co. LLC (Financial Advisor)

Closed June 2021

Sold by: Francisco Partners Management LP. Rockwell

$2,220.0

Zeeland

MILLERKNOLL INC. 1

MacKenzie Partners Inc. (Information Agent); Goldman Sachs & Co. LLC (Fairness Opinion Provider); Goldman Sachs & Co. LLC (Financial Advisor); Wachtell, Lipton, Rosen & Katz LLP (Legal Advisor); Computershare Trust Company, National Association (Transfer Agent/Registrar)

Sullivan & Cromwell LLP (Legal Completed Advisor); Computershare Trust April 2021 Company, National Association (Transfer Agent/Registrar); Kingsdale Advisors (Transfer Agent/Registrar); BofA Securities Inc. (Fairness Opinion Provider); BofA Securities Inc. (Financial Advisor); Kirkland & Ellis LLP (Legal Advisor)

Sold by: BlackRock Inc. (NYSE:BLK); The Vanguard Group Inc.; Silvercrest Asset Management Group LLC; Vulcan Value Partners LLC; Versor Investments LP; Global Furniture Investments S.À R.L.. Herman

$2,051.3

Dundee, Mich.

Hamilton Bermuda

Traverse City

Westbury, New York

New York

Indianapolis

Novi

Itasca, Ill.

Troy

United States

Milwaukee

KNOLL INC.

East Greenville, PA

Participations (US) Inc. entered into an agreement to acquire Firestone Building Products Company, LLC from Bridgestone Americas Inc. for $3.4 billion on Jan. 6, 2021. The transaction is valued at $3.4 billion on debt and cash free basis. Consideration will be finalized after adjusting the working capital of Firestone Building Products.

Investors LLC. The Hagerty Group, LLC entered into a definitive business combination agreement to acquire Aldel Financial Inc. from Aldel Investors LLC, Aldel LLC, FG Financial Group Inc. and others for $2.9 billion in a reverse merger transaction on Aug. 17, 2021. Upon the closing of the transaction, Aldel will be renamed Hagerty Inc., and become publicly traded, with its common stock expected to be listed on the New York Stock Exchange under the ticker HGTY.

Automation Inc. signed an agreement to acquire Plex Systems Inc. from Francisco Partners Management LP for $2.2 billion on June 25, 2021. The acquisition will be financed with a combination of cash and short-term and long-term debt.

Miller Inc. (NasdaqGS:MLHR) entered into a definitive agreement to acquire Knoll Inc. (NYSE:KNL) from group of shareholders for $1.5 billion on April 19, 2021.

ELECTRIC LAST MILE INC.

FORUM MERGER III CORP. Foley & Lardner LLP served as

Jefferies LLC served as financial advisor and White & Case LLP served as legal advisor to Forum. Cowen Inc., Wedbush Securities Inc., Colliers Securities LLC, BTIG LLC and The Benchmark Co. LLC served as coadvisers to Forum

June 2021

Troy-based Electric Last Mile Inc. (NASDAQ:ELMS) went public June of 2021 via a merger with Forum, a special purpose acquisition corporation (SPAC).

$1,400.0

MAXIMUS FEDERAL SERVICES INC.

VES GROUP INC.

Raymond James Financial Inc. (NYSE:RJF) (Financial Advisor)

Closed April 2021

MAXIMUS Federal Services Inc. signed an agreement to acquire Ves Group Inc. for $1.4 billion on April 20, 2021.

$1,400.0

SUN COMMUNITIES INC. Southfield

PARK HOLIDAYS UK LIMITED

Citigroup Inc. (NYSE:C) (Financial Advisor); Lazard Ltd (NYSE:LAZ) (Financial Advisor); Jones Day (Legal Advisor); Jaffe Raitt Heuer & Weiss, P.C. (Legal Advisor)

HSBC Holdings plc (LSE:HSBA) (Financial Advisor); RBC Capital Markets Inc. (Financial Advisor); Proskauer Rose (Uk) LLP (Legal Advisor)

Announced Sold by: Intermediate Capital Group plc Nov. 2021 (LSE:ICP). Sun Communities Inc. (NYSE:SUI) entered into definitive agreement to acquire Park Holidays UK Limited for group of shareholders for approximately £950 million on Nov. 13, 2021.

ROCKET COMPANIES

TRUEBILL

Paul Weiss Rifkind Wharton & Garrison LLP

FT Partners Cooley LLP

Closed Dec. 2021

Sold by: Truebill. Rocket Companies Inc. on Dec. 20 announced it had entered an agreement to acquire Truebill, a Maryland personal finance company, for $1.275 billion. The allcash deal was expected to add $100 million in annual recurring revenue to Rocket's $1.3 billion of annualized servicing fee income.

$1,275.0

DP WORLD LIMITED

SYNCREON.US INC.

White & Case LLP (Legal Advisor); JPMorgan Chase & Co. (NYSE:JPM) (Financial Advisor); White & Case LLP Avocats-Advocaten (Legal Advisor); White & Case LLP (Legal Advisor); White & Case SA (Legal Advisor); MHR & Partners in association with White & Case LLP (Legal Advisor)

Citigroup Inc. (NYSE:C) (Financial Advisor); Hogan Lovells (Legal Advisor)

Closed July 2021

Sold by: CVC Capital Partners and Carlyle Group Inc.. DP World Limited (UNQ-ARE:DPW) agreed to acquire

$1,200.0

AMERISTAR PERIMETER SECURITY

Honigman Miller Schwartz & Cohn; Baker Tilly

Dec. 2021

Sold by: Huron Capital. Huron Capital sold its interest in

$1,000.1

Pittsford, New York

Detroit, MI

DubaiUnited Arab Emirates

Tulsa, OK

legal adviser

Troy

Bexhill-on-Sea, East Sussex United Kingdom

Silver Spring, MD

Auburn Hills

B&B ROADWAY & SECURITY SOLUTIONS McKinney, Texas

$1,276.3

Syncreon.Us Inc. for an enterprise value of $1.2 billion on July 1, 2021.

B&B Roadway & Security Solutions to Ameristar Peremiter Security USA.

chosen the value it believes to be most accurate. S&P figures may differ from other published figures, which sometimes exclude assumed liabilities or other factors. For deals involving companies going public via a special purpose acquisition company reverse merger, the surviving company is listed as the acquirer and the combined value of the companies is used for the deal value. The list does not include all 2021 transactions, only those valued at $10 million or more. It is not a complete listing but the most comprehensive available. NOTES: 1. Formerly (and at the time of the transaction), named Herman Miller Inc.

Want the full Excel version of this list — and every list? Become a Data Member: CrainsDetroit.com/data FEBRUARY 21, 2022 | CRAIN’S DETROIT BUSINESS | 11

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CRAIN'S LIST | MERGERS & ACQUISITIONS IN 2021 Ranked by value of transaction VALUE OF TRANSACTION ($000,000)

ACQUIRER NAME

TARGET

ACQUIRER ADVISERS

TARGET/SELLER ADVISERS

DATE

DESCRIPTION

NEOGEN CORP. Lansing

FOOD SAFETY BUSINESS OF 3M CO.

Weil, Gotshal & Manges LLP (Legal Advisor); Centerview Partners LLC (Fairness Opinion Provider); Centerview Partners LLC (Financial Advisor)

Goldman Sachs & Co. LLC (Financial Advisor); Wachtell, Lipton, Rosen & Katz LLP (Legal Advisor)

Announced Dec. 2021

Sold by: 3M Co. Neogen Corp. (NasdaqGS:NEOG) entered $1,000.0 into a definitive agreement to acquire Food Safety Business from 3M Co. (NYSE:MMM) for approximately $1 billion on Dec. 13, 2021.

REGIONS BANK

ENERBANK USA

Stephens Inc. (Financial Advisor); Sullivan & Cromwell LLP (Legal Advisor)

Skadden, Arps, Slate, Meagher & Flom LLP (Legal Advisor); Goldman Sachs & Co. LLC (Financial Advisor)

Closed June 2021

Sold by: C.M.S. Capital, LLC. Regions Bank entered into

$960.0

BORGWARNER INC.

AKASOL AG

Foley & Lardner LLP (Legal Advisor); BofA Securities Inc. (Financial Advisor); Freshfields Bruckhaus Deringer Rechtsanwlte Steuerberater PartG mbB (Legal Advisor)

Allen & Overy LLP (Legal Advisor); Joh. Berenberg, Gossler & Co. KG (Financial Advisor); Hogan Lovells International LLP (Legal Advisor); PricewaterhouseCoopers GmbH Wirtschaftsprfungsgesellschaft (Financial Advisor);Joh. Berenberg, Gossler & Co. KG (Financial Advisor) and Hogan Lovells (Legal Advisor)

Closed Feb. 2021

Sold by: Morgan Stanley & Co. International plc; Lansdowne Partners (UK) LLP; Schulz Group GmbH. BorgWarner Inc. (NYSE:BWA) signed a business

$872.1

Milbank LLP (Legal Advisor)

Announced June 2021

Sold by: New Covert Generating Company LLC. Consumers Energy Company signed a purchase and sale

$810.0

Birmingham, Ala.

Auburn Hills

United States

Salt Lake City

Darmstadt, Hessen Germany

CONSUMERS ENERGY CO. 1,176 MEGAWATT Jackson NATURAL GAS-FIRED COMBINED CYCLE GENERATING PLANT OF NEW COVERT GENERATING COMPANY

combination agreement to acquire Akasol AG (XTRA:ASL) from Morgan Stanley & Co. International plc, Lansdowne Partners (UK) LLP, Felix von Borck, Stephen Raiser, Schulz Group GmbH and others for approximately $730 Million on Feb. 15, 2021.

United States

CLEVELAND-CLIFFS INC.

ALLY FINANCIAL INC.

Cleveland

Detroit

an agreement and plan of merger to acquire EnerBank USA from C.M.S. Capital, LLC for $960 million on June 7, 2021. Upon the terms of the transaction, EnerBank will merge with and into Regions Bank, with Regions surviving the Merger. Regions Bank will assume EnerBank's assets and liabilities, Including deposits.

agreement to acquire 1,176 megawatt natural gas-fired combined cycle generating plant of New Covert Generating Company, LLC for $810 million on June 21, 2021. At closing, Consumers Energy Co. will also assume certain liabilities of New Covert Generating Company. In a related transaction, Consumers Energy Co. signed a purchase and sale agreement to acquire three additional Michigan natural gas-fired power plants from Dearborn Industrial Generation, LLC, CMS Generation Michigan Power, LLC and CMS Energy Resource Management Company for approximately $520 million.

FERROUS PROCESSING Jones Day (Legal Advisor) & TRADING COMPANY

Bill Sider, Jaffe Raitt Heuer & Weiss, P.C.

Closed Nov. 2021

Sold by: Soave Enterprises, LLC. Cleveland-Cliffs Inc. (NYSE:CLF) entered into a definitive agreement to acquire Ferrous Processing and Trading Company from Soave Enterprises, LLC for an enterprise value of approximately $780 million on Oct. 11, 2021. Cleveland-Cliffs will pay the consideration in cash, on a cash-free, debt-free basis, subject to customary adjustment.

$775.0

FAIR SQUARE FINANCIAL HOLDINGS LLC

Citigroup Inc. (NYSE:C) (Financial Advisor); Goldman Sachs & Co. LLC (Financial Advisor); Sullivan & Cromwell LLP (Legal Advisor)

Skadden, Arps, Slate, Meagher & Flom LLP (Legal Advisor); JPMorgan Chase & Co. (NYSE:JPM) (Financial Advisor)

Closed Oct. 2021

Sold by: Pantheon Ventures (UK) LLP; Pine Brook Road Partners, LLC; The Orogen Group. Ally Financial

$750.0

Detroit

Wilmington, Del.

Inc. (NYSE:ALLY) entered into a definitive agreement to acquire Fair Square Financial Holdings LLC for $750 million on Oct. 21, 2021. Under the terms of agreement, Ally paying consideration in all-cash. Ally Financial deployed 25% of excess capital above internal target to fund strategic acquisition of Fair Square.

FRANCHISE GROUP INC. (NASDAQGM:FRG)

PET SUPPLIES PLUS LLC

Willkie Farr & Gallagher LLP (Legal Advisor); B. Riley Securities Inc. (Financial Advisor)

Piper Sandler Companies (NYSE:PIPR) Closed (Financial Advisor); Robert W. Baird & Jan. 2021 Co. Incorporated (Financial Advisor); Kramer Levin Naftalis & Frankel LLP (Legal Advisor); North Point Advisors (Financial Advisor);Kramer Levin Naftalis & Frankel LLP (Legal Advisor)

Sold by: Sentinel Capital Partners LLC. Franchise Group Inc. (NasdaqGM:FRG) entered into a definitive agreement to acquire Pet Supplies Plus, LLC from Sentinel Capital Partners VI-A LP managed by Sentinel Capital Partners, L.L.C. in a transaction valued at approximately $700 million on Jan. 23, 2021.

$700.0

ARCHAEA ENERGY INC.

ARIA ENERGY LLC

Kirkland & Ellis LLP (Legal Advisor); D.F. King & Co. Inc. (Information Agent); Richards, Layton & Finger, P.A. (Legal Advisor); Continental Stock Transfer & Trust Company (Transfer Agent/ Registrar); Moelis & Company LLC (Fairness Opinion Provider); Moelis & Company LLC (Financial Advisor)

Orrick, Herrington & Sutcliffe LLP (Legal Advisor); Barclays Capital Markets, LLC (Financial Advisor);Orrick, Herrington & Sutcliffe LLP (Legal Advisor)

Closed April 2021

Sold by: Ares Management Corporation . Rice Acquisition Corp. (NYSE:RICE) executed the letter of intent to acquire Aria Energy from Ares Management Corporation (NYSE:ARES) and others on Feb. 22, 2021.

$693.2

LION LITTLE WORLD BEVERAGES

BELL'S BREWING INC.

Closed Jan. 2021

Sold by: Bell's Brewing Inc.

$500.0 1

CARLYE GROUP

SCIENS BUILDING SOLUTIONS

Honigmon Miller Schwartz & Cohn

Announced Dec. 2021

Sold by: Huron Capital. Huron Capital sold Sciens to

$500.0 1

LINEAGE LOGISTICS HOLDING, LLC

CRYO-TRANS INC.

Owings Mills, Maryland

JPMorgan Chase & Co. (NYSE:JPM) (Financial Advisor); Latham & Watkins LLP (Legal Advisor)

DLA Piper LLP (Legal Advisor); DLA Piper

Closed Jan. 2021

Lineage Logistics Holding, LLC acquired Cryo-Trans Inc. on Jan. 5, $500.0 2021.

LITHIA MOTORS INC. (NYSE: LAD)

SUBURBAN COLLECTION

Holland & Knight LLP (Legal Advisor);

The Presidio Group LLC (Financial Advisor); Dadwa Mann (Legal Advisor)

Closed April 2021

Sold by: Fischer family. Lithia Motors Inc. (NYSE: LAD) signed in late January 2021 a definitive agreement to buy Suburban Collection and on April 12 closed on the sale for an estimated $500 million.

$500.0

REDICO / AMERICAN HOUSE AFFILIATED ENTITIES

REDICO / AMERICAN HOUSE PORTFOLIO

Jaffe Raitt Heuer & Weiss, Financial Advisors

Closed Oct. 2021

Sold by: REDICO / American House Affiliated Entities. Cash and financing

$435.0

WOLVERINE OUTDOORS INC.

LADY OF LEISURE INVESTCO LIMITED

Baker & McKenzie LLP (Legal Advisor); Eversheds Sutherland (Legal Advisor); Honigman LLP (Legal Advisor); Rothschild & Co SCA (ENXTPA:ROTH) (Financial Advisor)

Gibson, Dunn & Crutcher LLP (Legal Closed Advisor); Pinsent Masons (Legal Aug. 2021 Advisor); Goldman Sachs International (Financial Advisor); Raymond James Financial International, Ltd. (Financial Advisor); Financo Limited (Financial Advisor)

Sold by: L Catterton Partners. Wolverine Outdoors Inc.

$422.9

BRIDGESTONE AMERICAS AZUGA INC. Fremont, Calif. INC.

Hogan Lovells US LLP (Legal Advisor); PJT Partners LP (Financial Advisor)

Gibson, Dunn & Crutcher LLP (Legal Advisor); Lincoln International LLC (Financial Advisor); Barclays Capital Markets, LLC (Financial Advisor)

Sold by: Danlaw Inc.; Sumeru Equity Partners LP. Bridgestone Americas Inc. entered into an agreement to

$391.0

Delaware, Ohio

Canonsburg, Pa.

Australia

Washington, D.C.

Novi

Meford, Or.

Southfield

Rockford

Livonia

Novi

Comstock

Pleasanton, Calif

Troy

Southfield

London, Greater London United Kingdom

Nashville, Tennessee

Closed Aug. 2021

Carlyle Group. Huron Capital retained a minority stake and a seat on the board. Sciens management team remained intact.

agreed to acquire Lady Of Leisure Investco Limited from L Catterton Partners and other shareholders for approximately $420 million on July 31, 2021. The consideration comprises of $415.8 million, which is net of acquired cash of $7.1 million.

acquire Azuga Inc. from Sumeru Equity Partners LP, Danlaw Inc. and others for approximately $390 million on Aug. 2, 2021.

SOURCES: S&P Global Market Intelligence, (Marketintelligence.spglobal.com), Bloomberg Terminal and Crain's research | In some cases, more than one estimated value of a transaction exists. In those cases, Crain's has chosen the value it believes to be most accurate. S&P figures may differ from other published figures, which sometimes exclude assumed liabilities or other factors. For deals involving companies going public via a special purpose acquisition company reverse merger, the surviving company is listed as the acquirer and the combined value of the companies is used for the deal value. The list does not include all 2021 transactions, only those valued at $10 million or more. It is not a complete listing but the most comprehensive available. NOTES: 1. Company estimate.

Want the full Excel version of this list — and every list? Become a Data Member: CrainsDetroit.com/data

12 | CRAIN’S DETROIT BUSINESS | FEBRUARY 21, 2022

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2/18/2022 10:51:04 AM

FOCUS | BIGGEST DEALS

DEALS

From Page 10

And Mahoney said they likely have some more time before things slow in any meaningful manner. “The experts (who) gather a lot of the data, I think people really believe that it’s in the second or third inning of the private equity supercycle,” said Mahoney. “So that is something that we look at (and we think) this is an industry that’s going to continue to mature.” His peers have expressed similar sentiments, as outlined in a survey released in late January by Providence, R.I.-based Citizen’s Bank, which found the following: ` 54 percent of middle market private-equity firms say deal flow will increase from 2021’s record levels, while 33 percent say it will remain the same and 13 percent say they expect a decrease. ` Half of middle-market private equity firms expect valuations to remain stable, while 36 percent anticipate higher prices ` Among PE firms, 42 percent say valuations will remain stable and 42 percent expect multiples to increase. “It speaks volumes that companies and PE firms see this pace continuing,” Jim Childs, head of the M&A advisory practice at Citizens Bank, said in a statement accompanying the report. “It reflects the confidence level in the market. The pandemic really disrupted the operating environment, and that creates a new value proposition for both sellers and buyers.”

To that end, the latest Insight report by BizBuySell — which tracks small business M&A activity — shows that completed transactions in the small business Friar world have ticked back up to pre-pandemic levels. Not surprisingly, activity cratered in the first quarter of 2020 but by the end of last year was back on par with the heady days of 2019, according to the report. “If you look at it by historical standards, 2020 and 2021 were great years for M&A,” said Steven Hilfinger, partner at Foley & Lardner LLP whose practice focuses on M&A deals. “A lot of that is driven by strong public markets and a lot of available private capital, and then being able to borrow at a low rate — that’s all fuel for a good market.” An anticipated increase of low interest rates that helped fuel deals last year could have a drag on transactions, Hilfinger said. That’s not to say M&A activity won’t be strong, he said, but it may not reach the record levels of last year.

The ‘burnout’ factor To be sure, not all deals look the same and not all segments of the markets will act the same, said Max Friar, managing partner of Calder Capital LLC, a Grand Rapids-based M&A advisory firm focused on low-

AND ONE BIG DEAL NOT ON THE LIST Not listed on our annual Biggest Deals list: the mega-merger between Southfield-based health system Beaumont Health and Grand Rapids’ Spectrum Health. Why? Because the health systems are both organized as nonprofit operations, and our list deals only with private businesses. Likewise, due to the nonprofit status of the hospital companies, no consideration really changes hands in the merger, so it’s hard to say there is a purchase price. But the scale of the deal is hard to understate. It’s created the state’s largest employer with 22 hospitals and roughly $12 billion in annual revenue. By revenue, that’s almost as big as Battle Creek-based Kellogg Co., which sells its products around the world. Join our webcast Crain’s will feature the leaders of the Beaumont-Spectrum deal in our “Behind the Scenes of the Biggest Deals” among other sessions at our free

er middle market transactions. For companies with earnings of $3 million or above, “it’s full steam ahead,” according to Friar. However, on the lower end of the spectrum, the combination of interest rates ticking up coupled with the findings of the BizBuySell report indicate some slow down, particularly with regards to valuations. The report, Friar notes, points to

“Behind the Scenes of the Biggest Deals” webcast on March 3. Guests include Tina Freese Decker, president and CEO of BHSH System; Robert Roth, BHSH board member and former Spectrum Health Board Chair; and Julie Fream, board chair of BHSH System and former Beaumont Health board chair discussing how the deal came together. Other panels include: ` Buying a business during a pandemic, featuring Ryan LaFontaine, CEO of LaFontaine Automotive, and Paul Glantz, co-founder and chairman of Emagine Entertainment. ` Deal-making forecast, featuring Rajesh Kothari, founder and managing director of investment banking and private investment firm Cascade Partners, and Evonne Xu, a partner at Dinsmore & Shohl. To register for the webcast, go to crainsdetroit.com and look under the “Events” tab.

the notion that more companies are coming to market looking to sell, so supply and demand kicks in. “So a little bit higher interest rates, more sellers coming to market, which means buyers are going to have more choices,” said Friar. Businesses that struggled during the COVID-19 pandemic, such as automotive suppliers, are under increased pressure to turn around fi-

nances as interest rates increase and banks become less flexible with borrowers, Hilfinger said. That could be an accelerant for distressed M&A. “If companies have really been hit hard by cost increases and other supply chain disruptions, that certainly does create opportunity for distressed M&A by healthier companies,” he said. Both Friar and the Citizen’s M&A survey, however, point to one item that’s likely to keep deal flow plentiful for some time: burnout. Simply put, the pandemic and associated challenges with supply chain issues and worker shortages are leading many operators to say enough is enough. “Pandemic burnout among Baby Boomer business owners could also be the key driver behind the jump in sellers looking to sell their whole business,” something which rose to 39 percent compared to about 24 percent in the prior year,” according to the Citizen’s report. Friar agrees, noting that even a handful of interest rate hikes, expected by regulators throughout this this year in an effort to tamp down inflation, will likely matter little to those who are ready to throw in the towel and exit their business. “Mass Baby Boomer burnout is much more powerful than a point increase in interest rates,” said Friar. Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl SPONSORED CONTENT

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isn’t a replacement for due diligence, planning and partnership. In fact, deals require special preparation, and typically, underwriters want to see a quality of earnings report before issuing a policy. Firms expecting to close were met by a bottleneck when underwriters, attorneys and accountants were already at capacity and unable to take on new engagements. Working with a trusted partner early on in a deal will ensure all aspects of risk management are being addressed to help safeguard a firm’s transaction and its future.

An experienced specialist can help guide you through the different aspects of your transaction, get your information arranged in a timely fashion and potentially help you avoid end-of-the-year bottlenecks and other transaction pitfalls. Thompson Flanagan, an NFP company, offers clients expertise in merger and acquisition transactions. From due diligence support to offering coverage options, our specialists know how to help purchasing firms make more effective, protected transactions. For M&A coverage and beyond, NFP’s network of specialists is ready to help organizations manage risk and support employees.

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2/18/2022 10:53:48 AM

RESTAURANT ROUNDUP

Great Lakes Coffee workers aim for union, bakery to expand A roundup of local food, drink and restaurant news BY NICK MANES

Great Lakes Coffee employees go on strike The flagship retail location of Great Lakes Coffee Roasting Co. in Detroit’s Midtown neighborhood has been closed for weeks, and is now facing a strike by workers. Workers at the coffee company say they have opted to form a union and were walking a picket line outside the closed location along Woodward Avenue on Wednesday. Lex Blom has been in the coffee industry for a dozen years with more than four of them at Great Lakes Coffee, the barista told Crain’s. “And at this point in time, after 12 years of having gained certifications, having won competitions, I still can’t find a wage that is indicative of the skill and the time that I put into my career,” Blom said. “And coffee really is a craft.” The workers at Great Lakes Coffee are calling themselves “Comrades in Coffee,” and 20 of 24 retail staffers have signed up for the union, according to Diana Hussein, a spokesperson for Unite Here, the labor union that is organizing the workers. The union previously organized

jobs to come back stronger as the economy rebounds,” Unite Here Local 24 President Nia Winston said in a statement. “As service industry employers struggle to win back workers, Great Lakes Coffee Roasting Company workers are demonstrating exactly what is needed to do so: safer jobs with good wages, benefits and union representation.”

Give Thanks Bakery expands to Royal Oak

Workers picket Wednesday outside Great Lakes Coffee Roasting Co. location in Midtown Detroit. | NICK MANES/CRAIN’S DETROIT BUSINESS

workers at the Westin Book Cadillac hotel in downtown Detroit. Attempts by Crain’s to reach Great Lakes Coffee management were unsuccessful Wednesday. Other locations, including stores in Woodward Corner Market in Royal Oak and Rivertown Market in Detroit were open and serving customers Wednesday afternoon. Workers say the strike at the Midtown location is an effort to get

management to recognize their union, which beyond a $15 per hour starting minimum wage seeks greater COVID-19 safety protocols, affordable health insurance, paid time off and other demands, according to a statement. “Great Lakes Coffee workers are powerful examples of individuals in a historically non-unionized industry pushing to improve their existing jobs and fight for hospitality

A European-inspired bakery plans to expand to downtown Royal Oak later this year. Give Thanks Bakery, with locations in Rochester and the Midtown neighborhood in Detroit, announced this week that it plans to open in the former Hermann’s Bakery site at 317 Main St. in the spring. A specific date was not released. The 2,700-square-foot space will serve coffee, bread and pastries in the “European tradition,” according to a news release. “We are so excited to embrace the heritage and tradition of this space as a bakery,” Give Thanks owner Katy Knoer said in a statement. “Our goal is to continue the spirit of bringing delicious baked goods to the Royal Oak community and give this beautiful building an updated storefront that honors its past.”

Yum Village plans West Village expansion Popular Caribbean restaurant Yum Village, in Detroit’s New Center area, will reportedly expand to the city’s West Village neighborhood. Yum Village founder and chef Godwin Ihentuge told Detroit Metro Times that he’s working to acquire the space that previously housed the Detroit Vegan Soul location in the east side Detroit neighborhood. Detroit Vegan Soul closed its West Village location last month, citing staffing issues, Crain’s previously reported. Ihentuge told Metro Times that he is attempting to secure a liquor license for the proposed second location, which he hopes to open in May. Yum Village has its origins as a food truck, which served food in the West Village neighborhood, according to the Metro Times report. A spokesman for Yum Village had no immediate comment when contacted by Crain’s.

Send us your tips and news Tell us about restaurant and bar openings and closings, new product lines, new owners and chefs, bakeries, markets, suppliers and more. If you have something to share about the local food and drink scene, email jason.davis@crain.com and/or bvalone@crain.com.

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CARING FOR KIDS Advocating for children’s physical, mental and developmental wellbeing ABOUT THIS REPORT: On this monthly radio program, the Children’s Foundation President and CEO Larry Burns talks to the community, government and business leaders about issues related to children’s health and wellness. This hour-long show typically airs at 7 p.m. the fourth Tuesday of each month on WJR 760AM. Here’s a summary of the show that aired Feb. 16th; listen to the entire episode, and archived episodes, at yourchildrensfoundation.org/caring-for-kids

Lenora Hardy-Foster

Jan Cairnes

Matt Kjorstad

CEO, Judson Center

CEO, Hanley Foundation

CEO, First Tee - Greater Detroit

LARRY BURNS: After 40 years in the nonprofit world, what led you to want to become the CEO of the Judson Center?

LARRY BURNS: The Florida-based Hanley Foundation’s history is similar to The Children’s Foundation. Tell us about it.

LARRY BURNS: As a new member of The Children’s Foundation, tell us about yourself.

LENORA HARDY-FOSTER: Working for

JAN CAIRNES: Around 40 years ago,

raised in the Twin Cities in Minnesota and my family is multiracial. I grew up in a very marginalized community. I served for four years as a Marine and I came back to my neighborhood after serving because I saw the same exact disparities in my community that I saw in communities all over the world. I began to partner with the YMCA to develop a community program model called Beacons. It focused on creating real opportunities for young people to grow as leaders and to be instrumental in leading systems change. I worked for my community for over 20 years and was blessed to lead a team that served over 5,000 young people a day.

Southwest Solutions for 36 years, I learned so much about the nonprofit sector. I also realized that my gratification came from working for nonprofits. When I was approached by the Judson Center to become the CEO, it filled my heart with joy. I said yes, and I went for it. I’ve been here six years. Burns: Tell us about the new services offered in behavioral health. Hardy-Foster: Our mission is to provide expert comprehensive

services to strengthen the lives of children, adults and families that are impacted by abuse and neglect, autism, developmental behavior and substance use disorder. Behavioral health is integrated care. Our Warren offices are our largest integrated care practice.

Burns: Do you have any nonprofit collaboration examples that you’re particularly proud of? Hardy-Foster: I strongly believe in collaborating and partnering

with other nonprofits because that allows you to make an even greater impact within your community. In regards to behavioral health, we’re fortunate to be recognized as one of the Certified Community Behavioral Health Clinics (CCBHC) in Michigan. That allows us to build partnerships with almost all the major hospitals. We also partner with Salvation Army Harbor Light to expand our services to people that are suffering from substance use disorder.

Mary Jane Hanley found herself with an alcohol addiction. Her family got her into treatment and she got sober. Afterwards, Mary Jane and her husband, Jack, decided they would spend the rest of their life helping people get sober. They gave a million dollars to the United Way and then they started raising money. At that point, there were two organizations, the Hanley Foundation and Hanley Center. Fast forward to 2016, when the Center was sold for profit, and the Foundation became a stand-alone organization. Then, we had six employees and $650,000 in grants. Today, we have almost $10 million in grants and nearly 100 employees. We will serve over 100,000 children in Florida this year. We have areas of work that we focus on. First is prevention because 90 percent of addictions occur before the age of 18. Second: we raise money to help people get quality treatment. We work with organizations around the country to ask them to give us a bid to give someone a chance at life. Our average spend on a scholarship to a quality treatment center is about $6,000 for a treatment episode that might have cost $40,000. Sometimes 30 days of treatment is not enough. If a treatment center we’re working with tells us a client is really enthusiastic but they need a longer term stay, we support that channel. We call that our Any Length Program. That is supported by community donations. That’s a direct channel that we raise money for.

MATT KJORSTAD: I was born and

Burns: What is First Tee is all about? Kjorstad: We’re a youth development organization. We’ve seamlessly integrated the game of golf with a life skills curriculum to create active learning experiences for kids. We want to build that inner strength, that self-confidence, the resilience that transfers into everything that they do. We want to provide that space for them to be safe and discover who they are, to develop new relationships, to grow in their confidence, all while learning skills on the golf course. Burns: What are some of the strategic initiatives for this year? Kjorstad: We want to connect our young people to some of those foundational partners that are going to change the game.

Burns: Tell us about your history with the Hanley Foundation. Burns: What can be done to eliminate the stigma around mental health, especially with young people? Hardy-Foster: It’s very sad that in 2022, there is still a stigma

Cairnes: In 1998, the Rooney family gave the foundation a $20,000

grant to do work in the community where I was living. I was asked if I’d be interested in doing a parenting program. We facilitated about eight programs that first year. During that same time period, we also started writing grants. When the year ended, we received our first grant for substance abuse prevention programs in the schools.

associated with mental health challenges. We should be able to recognize that mental health is an essential part of our overall health. We should be encouraging thoughtful conversations about mental health. It’s all about educating family members, so the entire family understands what is going on and can ensure that that child has access to services and can support that young person.

Burns: Tell us about the Hanley Foundation’s relationship with The Children’s Foundation.

Burns: Tell us what you’ve seen during COVID.

Cairnes: We partnered together and The Children’s Foundation

Hardy-Foster: It has disrupted the lives of children and adolescents

and increased the number of children being diagnosed with a mental illness. It did create anxiety and depression that children have been dealing with. At the Judson Center we can implement a treatment plan to improve what they may be struggling with.

Burns: How can we learn more about the Judson Center programs? Hardy-Foster: We’re always looking for people to volunteer at the organization. We’re always looking for people to get behind us financially, either through donations or attending one of our events. We have four major events annually, including two galas, a golf challenge and the Detroit Free Press Marathon. Our website www.judsoncenter.org has information. I’d also like to add that we’re not just Oakland County. We’ve expanded over these 98 years and we have offices in five counties including Wayne, Macomb, Washington and Genesee.

is working with some of their donors to raise money to provide scholarships through our programs. We look forward to working together in both the Palm Beach, Florida area and Michigan. Burns: How can people listening find out more about your programs? Cairnes: Our website, www.hanleyfoundation.org, is the first

and foremost place where you can get more information. From there, you can connect, donate, send messages, ask questions and find out more about us. Parents can connect with our prevention department to see if we can get our programs into their schools. We are here as a community resource. We’re the largest provider of prevention services in the state of Florida. We want people to reach out, ask questions and talk to us any way we can help.

Burns: We are delighted to announce that Jan Cairnes will be one of our keynote speakers at our Behavioral Health Summit on April 12.

Burns: I know it’s important to First Tee to allow youngsters to see what college can be and keep that dream alive. Kjorstad: Golf is our foundational piece, but getting our young people to go on campus, to be in places that they haven’t seen before, helps make attending college more of a reality. It is so critical to have not only that dream, but to have young people able to see themselves in that place. That’s just one component that is life-changing for a lot of young people. Burns: How can people get involved with First Tee? Kjorstad: We are on every social media platform as First Tee - Greater Detroit. Visit our website, firstteegreaterdetroit.org, for information about our programs, locations and volunteer opportunities. All of our coaches and volunteers are from the community. You don’t even have to know how to swing the club to volunteer. Our young people need to be around adults that care about them, their future and their growth.

I want everyone to consider being a financial stakeholder. We have an obligation to reach back and be a stakeholder in our young people’s future. Burns: What’s coming up? Kjorstad: We have a few events that we’re going to be promoting this year including the Second Annual Ben Hogan Championship of Michigan on Aug. 22 at the Country Club of Detroit. We will also be hosting the 100 Hole Golf Marathon in September at Chandler Park Golf Course.

Advertising Section

PEOPLE ON THE MOVE

From Page 6

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

ADVERTISING / MARKETING

FINANCE

LAW

SSDM

Mi BANK

Tena Hermance Joins SSDM as Director of Agency Experience in Troy, Mich. SSDM, an award-winning digital marketing agency, welcomed Tena Hermance on January 17, 2022. With a resume that includes some of Detroit’s big-name agencies, Hermance has always been at the forefront of agency and client growth. At SSDM, she will take the lead on all client management to maintain the highest level of satisfaction with every aspect of their agency partnership experience.

Mi BANK announces the appointment of Bruce Kridler as Director of its new Private Client and Family Office initiative. In his new role, Kridler will oversee the delivery of additional products and services to Mi BANK’s high net worth and ultra-high net worth clients. Kridler joins Mi BANK from Greenleaf Trust in Birmingham, Mich., where he served as director of business development and spent eight years growing the brand’s presence in southeast Michigan.

Williams, Williams, Rattner & Plunkett, P.C.

ENGINEERING / DESIGN

Burns & McDonnell Cyrill Weems has joined Burns & McDonnell to lead infrastructure development in Michigan as the Director of Infrastructure in our Detroit office. With 20 years of experience, Weems brings extensive process knowledge and experience in client management, risk management, project management, construction management and program management. His leadership will be key to the firm’s continued success and expansion into a number of industries, strengthening the firm’s partnerships in Detroit.

FINANCIAL SERVICES

Stifel Nicolaus Howard L. Margolis, AIF®, CTFA, has joined Stifel’s Southfield office as Senior Vice President/Investments and Portfolio Manager – Solutions Program. A financial advisor since 1987, he helps his clients pursue their financial goals by building customized, agile plans designed to help them grow, manage, and protect their wealth. He is a Michigan State University graduate and holds the Accredited Investment Fiduciary® and Certified Trust and Fiduciary Advisor designations. Visit: howard. margolis@stifel.com.

Williams, Williams, Rattner & Plunkett, P.C. announces Jerome P. Pesick and Jason C. Long have Pesick joined the firm as shareholders, bringing their extensive eminent domain, condemnation, land use, and property tax experience to WWRP’s venerable practice. Pesick has tried and settled condemnation cases across Michigan for more than 40 years, Long securing tens of millions of dollars for clients. He also represents clients in major property tax appeals involving all types of commercial properties. Long has represented clients in eminent domain, real estate, land use litigation, and appeals for nearly 20 years. His experience includes a range of real property and tax issues, including ownership disputes, valuation, tax exemption, and many others.

SHARE YOUR COMPANY’S JOURNEY

Feature your latest milestones, launches, partnerships, awards and more in Crain’s

LAW ENGINEERING / DESIGN

NI Drita Roggenbuck has joined NI as Senior Vice President and General Manager for the Transportation Business Unit. Drita will be responsible for accelerating growth of the automotive test business at NI, with a focus on electric vehicles (EV) and advanced driver-assistance systems (ADAS). Drita brings over 20 years of experience and has held numerous leadership positions within the Detroit automotive industry, most recently senior vice president and chief customer and strategy at HFI.

Jaffe Raitt Heuer & Weiss, P.C. Jaffe Raitt Heuer & Weiss, P.C. welcomes Kimberly Ross Clayson as a partner in the firm’s Insolvency & Reorganization practice group. Kimberly is a renowned legal counselor who brings years of experience across several disciplines. She has spent the last 15 years advising debtors, creditors, small businesses, entrepreneurs and nonprofit organizations on a variety of matters, including bankruptcy law, business law and compliance matters.

LIVENGOOD

To this day, the Michigan Legislature is still prohibiting the Michigan Department of Transportation from spending any state tax dollars on construction of the Gordie Howe International Bridge, which isn’t slated to open until 2024. MDOT employees that work on the Gordie Howe project have to log their hours and effectively send Canada the bill for reimbursement because of a prohibition written into the state budget that the Morouns lobbied for. The Canadians, remarkably, have been willing to pay for the whole thing because their leaders have long predicted an economic disruption like what’s transpired at the Ambassador and at the Blue Water Bridge connecting Port Huron and Sarnia, Ontario. “It was worth $5 billion to us to ensure” the flow of auto parts and food across the border, said Roy Norton, who served as Canada’s top diplomat in Detroit from 2010 to 2014. “It wasn’t because Canada suddenly decided to be charitable,” Norton said. “We regard this crossing as the most important economic link that our economy has with the U.S. economy, and it’s critical that, from the point of view of investment on both sides that businesses be able to understand that (link) will be there to move their product back and forth seamlessly.” Norton, who retired from the Canadian government in 2020, was on the front lines of the battles with the Morouns over getting an agreement to build a second span downriver from the Ambassador. Calley, Norton and Shields all worked together in 2012 to defeat the Moroun family’s attempt to amend the state Constitution by adding a monopoly protectionist requirement that any new bridge to Canada be approved by the voters. The Morouns’ $36 million campaign went down in flames at the ballot box, even though they outspent Shields’ “vote no” campaign 17-to-1. But that didn’t persuade the Republican-controlled Legislature, even after then-Gov. Rick Snyder engineered a deal where Michigan gets to count Canadian spending on the bridge toward Michigan’s total road spending in order to draw down additional federal matching funds for highway improvement across the state (Michigan’s share of the bridge cost will be repaid through tolls over 30 years). When complete, the Gordie Howe bridge will add six lanes of capacity to the international border and be connected directly to I-75 in Southwest Detroit and Ontario’s 401 Highway through the Herb Gray Parkway, a $1.5

billion, 7-mile freeway the Canadians starting building a decade ago for a new bridge. There’s no telling whether a second bridge could stop an illegal Norton blockade. But transportation experts say it would have been harder to gum up the Herb Gray Parkway or I-75 in Detroit than an open-access city street like Huron Church Road. “While an extra six-lane bridge would have not stopped this, it would have required significantly more trucks to generate the blockage we are seeing,” said Kirk Steudle, a former MDOT director under Snyder and exGov. Jennifer Granholm who is now a senior vice president at the California-based traffic management firm Econolite. “I do think this shows what would happen if there were some other incident that closed the bridge and the ripple and crippling effect it would have,” Steudle added. For the auto industry, the border crossing in Detroit is paramount to just-in-time manufacturing. Some auto parts and components are said to cross the U.S.-Canada border a half-dozen times before they end up at assembly plants from Ontario to Mexico. “The microchip shortage was less problematic because at least you can still build the whole vehicle,” Calley said. The Morouns, for their part, have changed their tack in recent years under the third-generation leadership of Matthew Moroun, son of Matty, who passed away in July 2020. Since exhausting all legal options, Matthew Moroun has been continuing to pursue the land and permits needed to build a second span (the Canadians have effectively said yes, as long as he tears down the Ambassador). In an interview with Crain’s, Matthew Moroun appealed for fairness in how the privately owned Ambassador Bridge is treated, knowing that competition is coming — and a government bridge can operate at a loss. “I realize the Gordie Howe is a reality, it’s being constructed right now — it’ll be in business and in service in a few years,” Moroun said. “But I also realize, and I hope everyone else does now, that the Ambassador Bridge is very important too — all of these bridges are.” Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood

DEALS&DETAILS

For more information, contact Debora Stein at dstein@crain.com or submit directly to CRAINSDETROIT.COM/COTM

` EXPANSIONS

` MERGERS & ACQUISITIONS

` UHY Advisors Inc., Farmington Hills, an accounting and consulting firm, joined with two accounting firms, LWBJ, an audit, accounting, tax, consulting, and mergers/ acquisitions firm with offices in Des Moines and Ames, Iowa; and TGM Group LLC, a firm with specialization in construction, government and not-for-profit in Salisbury, Maryland. Website: uhy-us. com ` Berkshire Hathaway HomeServices, Irvine, Calif., a residential real estate brokerage franchise network, has added Berkshire Hathaway HomeServices Kee Realty, Clinton Township, to its network. Website: bhhskeerealty.com

` The Care Team, Farmington Hills, a hospice and home health provider, acquired Crossroads Hospice, Houston, Texas, a hospice provider. Terms of the transaction were not disclosed. Website: tctcares.com ` Altair, Troy, a software company, acquired Cassini PLM, Hyderabad, India, a cloud platform. Website: altair.com

` NAME CHANGES ` Gov. Gretchen Whitmer changed the name of the Michigan Council for Arts and Cultural Affairs, the state’s arts and culture agency, to the Michigan Arts and Culture Council. Website: michiganbusiness.org/arts

18 | CRAIN’S DETROIT BUSINESS | FEBRUARY 21, 2022

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CANNABIS

From Page 1

"We've heard from quite a few people who have interest in that, but obviously with the pandemic, that kind of derailed their plans," said Andrew Brisbo, director of the Michigan Marijuana Regulatory Agency. "I think it's been a license type that's also been more slowly adopted by municipalities ... because it is a little bit different." The name of the cream-painted storefront along John R in Hazel Park reads in stark black letters: Hot Box Social. The business is in line to become the first in Michigan where smoking pot at a business is legal. It submitted application materials in January and is waiting on some changes before it could potentially receive a consumption establishment license and open. Hot Box Social, at 23610 John R, north of Nine Mile Road, is owned by Trucenta, a vertically integrated cannabis company based in Troy. Trucenta runs cannabis stores in Hazel Park and Battle Creek under the Breeze brand. Breeze is also in the process of expanding its shop down the road from Hot Box Social from 1,300 square feet to 4,800. The space is currently open for non-consumption events and has hosted bud-tender training sessions with edibles brands Wyld and Select X-Bites in the last several weeks, said Sandy Aldrich, chief marketing officer for Trucenta. A big catch for Hot Box Social and all other consumption lounges is that they can't legally sell cannabis on site. How they get around this, generally, is by either having patrons buy product at a nearby retail establishment and bring it in themselves, or by getting their edibles or flower delivered to the consumption site. Delivery is allowed. Hot Box Social expects Breeze and other nearby retailers to deliver. If what's essentially a pot bar can't make money selling the product, how does it make it a profitable enterprise? In short, it's tough, which is another reason these businesses aren't cropping up faster. The answer for the businesses Crain's spoke with ranges from hosting private events and selling tickets for public events to showcasing specific brands, doing educational seminars, charging for time like in a co-working space and more. "I do think some of those ideas are really starting to percolate out there," Brisbo said. Aldrich declined to say how much Trucenta has invested in the 2,000-square-foot storefront in Hazel Park with a 250-person capacity. It also expects to add 5,000 square feet of outdoor space. Aldrich also declined to estimate when Hot Box Social may be open as a consumption space. When it is, the company plans to host more private events for clients and, eventually, public events like concerts and art shows. There could also be educational events for non-regular users who want to learn about how to pick out flower and grind it; yoga classes with consumption; a smoke-and-paint event like a wine-and-paint event; burlesque shows and potentially food available on site, Aldrich said. Whatever brings the "cannabis community together," she added. "I’m dying to find out who’s going to have their first wedding reception (at Hot Box Social)," she said. "Wouldn’t that be so cool?"

More consumption coming Another potential cannabis social space, the aptly named Kalkushka

A F e e - O n l y We a l t h M a n a g e m e n t G r o u p

Michigan’s #1 Financial Advisor by both Barron’s* and Forbes** Charles C. Zhang CFP®, MBA, MSFS, ChFC, CLU CEO and Founder

Event space Hot Box Social, from Troy-based cannabis company Trucenta, is applying to become a state of Michigan-licensed cannabis consumption lounge. | HOT BOX SOCIAL

Lounge in Kalkaska in northern Michigan, is about a month behind Hot Box Social when it comes to license application and is the second of two consumption establishments with applications currently pending at the state level. The lounge would open in half of an old opera house downtown, co-owner Russ Chambers said. The other half is taken up by Chambers' already open dispensary business, The Botanical Co. The COVID-19 pandemic has delayed Chambers' lounge business plans by six to eight months, he said. He hopes for a March opening. The retail side would deliver to the lounge, or patrons could stop by and buy their cannabis before they go relax in Kalkushka. Buying from The Botanical Co. could get customers into the lounge for free, or perhaps a reduced price. As planned, the Kalkaska consumption establishment, a more than $1 million endeavor that's still under construction, would also have a coffee bar and sell packaged food. It has a stage for comedians and bands. "We want the vibe to be real chill," Chambers said. "We’re just excited for the opening. It took us forever to get this ready and get this done ... I guess we'll see how this goes. It's so new." Both the lounges' timelines are, of course, contingent on securing those licenses and overcoming any other hurdles they may face in opening their doors. Other consumption lounges that are reportedly in the works include one in Ann Arbor from Holistic Industries, whose retail brand is called Liberty. A message seeking comment was not returned. Gage Growth Corp. has also said it's planning one in Kalamazoo under the West Coast-originated Cookies brand. A message was sent to a representative requesting comment. Harrison Township-based Pleasantrees also hopes to open a consumption lounge eventually on the old Gibraltar Trade Center site in Mount Clemens, where it's opening a flagship retail store and cannabis-infused drink operation with Blake's Hard Cider Co., said Randy Buchman, CEO and founder of Pleasantrees. But that could be a long way out, as it also depends on the city of Mount Clemens approving recreational cannabis sales, as well as specifically consumption lounge licenses, in its borders. Another consumption lounge plan has formed in Bay City, though the city still doesn't allow them and rules would need to be changed before it comes to fruition.

It's unique, though, in that it would be part of a larger complex that includes a bowling alley — a "seed-toconsume" block of businesses, said Mahja Sulemanjee-Bortocek, founder and CEO of High Haven. The Bay City-based company is in the business of combining cannabis and entertainment, looking to create a safe place to ingest marijuana, Sulemanjee-Bortocek said. Its downtown Bay City dispensary is expected to open in May. The 24-lane bowling alley, Washington Lanes, is open on the same block. Later, High Haven hopes to open a bar, cafe and consumption lounge.

Where they can open Michigan has no licensed consumption lounges in operation, but is among at least seven states where they are legal. Localities can still decide to opt out if they want, but there are more than 280 Michigan municipalities allow one or more of them to open. Neither Kalamazoo, Ypsilanti or Ann Arbor have placed a cap on the number of consumption lounges that can open, according to the state's records. But Battle Creek, one of the state's biggest towns for recreational cannabis retail, does not allow them. Grand Rapids and East Lansing also opted out, while Lansing is allowing one per ward, or four total. In metro Detroit, Hazel Park has no local limits on consumption lounges that have been recorded by the state, while Ferndale and Warren have banned them. Highland Park allows three. Detroit, if its proposed recreational cannabis ordinance passes, will allow 35 consumption lounges to operate in its borders. They're allowed to sell and serve food as long as they have authorization from local departments to do so, but not alcohol. "There's just not a lot of data that would support the right way to go about" allowing those two intoxicants to mingle at the same business, Brisbo said. "So that's not really been our focus to open up that pathway." He said the agency has heard "mixed reviews" on whether county health departments would license a consumption business as a food service establishment. However, the state is talking with potential consumption business owners to see how it can potentially modify regulations to help them get open and succeed, he said. Consumption lounges are going to be a major area of focus in the MRA's next round of rule changes, he added. Contact: afrank@crain.com; (313) 446-0416; @annalise_frank

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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.

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FEBRUARY 21, 2022 | CRAIN’S DETROIT BUSINESS | 19

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OAKLAND HILLS

From Page 1

those exact kind of plans and then probably the more immediate is how are we going to put up structures for this coming golf season,” Palmer told Crain’s in an interview last Thursday after the clubhouse burned down. The fire comes close on the heels of last summer’s reopening of the famed South Course, which members waited two years for and paid $12 million to complete. Both courses and all golf operations, including the maintenance facility and golf cart shed, escaped damage from the fire. Avoiding any further disruption at the golf courses — the heart of Oakland Hills — is imperative, Bayliss said. “That’s really the driving forces at Oakland Hills, are the golf courses,” he said. “While the clubhouse itself is arguably as iconic as the golf that was played there, you really try to guide the membership to as good an experience you can provide.” Frank Rewold hadn’t spoken to Bayliss, an old buddy of his, in probably about a decade, but Rewold felt compelled to reach out Wednesday as he was sitting in the Detroit Athletic Club. When the two men connected the following day around 10:30 a.m., the Oakland Hills clubhouse building they had worked so hard to restore more than two decades ago together was up in flames. “I said, ‘You’re not gonna believe this,’” said Rewold, who is head of Rochester-based Frank Rewold & Sons Inc., which worked on the 19992000 renovation of the clubhouse when Bayliss was COO of Oakland Hills. “It was too spooky.” The work done on that $16.25 million rehab, Rewold said, should shed some insight into the challenges that lay ahead. To demonstrate how extensive the renovation more than 20 years ago was, Rewold described times when he stood in the property’s attic and would look down and see all the way to the dirt of the basement floor. One of the reasons it was effectively stripped to just its bones back then rather than torn down and built new at the time was there were a variety of bureaucratic challenges, including setbacks and easement requirements, that the club didn’t want to contend with, Rewold said. That would also be the case today, Rewold said. Another issue is politics. Club board members, club members and others will all have opinions on how the rehabilitation takes place and it risks becoming a political headache for those involved, said Rewold and Charles Merz, an architect

BROKER

From Page 3

I said I was just going to call the Black companies. I thought for me to really be successful, I had to put a footprint in downtown Detroit. ` Because you’re Black? Mmhmm. Before then, there were very few commercial brokers — it’s still very few. You’ve got Summit (Commercial), who are my very close friends. But if you go away from there, there is not a lot. It’s a very tough industry. It happened that I was single. In order for me to make contacts and establish a book of business, you have to pay your dues. The business is tough and I only had to worry about myself.

Firefighters battle the blaze at the Oakland Hills Country Club last Thursday. | NIC ANTAYA/SPECIAL TO CRAIN’S DETROIT BUSINESS

An exterior view of the club house at Oakland Hills Country Club in 1924. | WALTER P. REUTHER LIBRARY, ARCHIVES OF LABOR AND URBAN AFFAIRS, WAYNE STATE UNIVERSITY

The construction and renovations at the clubhouse are expected to be well-documented, an advantage for a reconstruction effort.| WALTER P. REUTHER LIBRARY

who is owner of Detroit-based Merz & Associates LLC, which worked on a Detroit building long thought unsalvageable after a fire and years of decay: The James Scott Mansion on Peterboro Street. “I do not envy the decision makers,” Merz said. “They are going to be scrutinized ... You almost can’t make a right choice. Someone’s always going to be mouthing off. Even if you do your best to restore it, some jackhole is gonna say, ‘Why restore it? I mean, it’s lovely, but come on, guys.’” Those tasked with rebuilding the property will also be faced with a challenge Rewold faced two-plus decades ago: Rebuilding the clubhouse while keeping the golf course open. “It’s not an easy task,” Rewold said. “It’s a fairly small site. You’ve got a driving range on one end and a golf course that kind of wraps around the building,

and then you’ve got parking in the back. It’s not as easy as it sounds, to build that and keep it open.” One of the benefits of it being such a recognizable building with all of its history is the sheer amount of photographs and record-keeping that have gone into the property over its 100year history, Merz said. “I’ll bet you that damn building is so well-documented, every change they ever made, that it could be reconstructed,” he said. Much of the club’s precious memorabilia, including trophies from numerous major championships held there over the past 100 years, was salvaged, the club confirmed. Palmer said the building and its contents were insured but declined to discuss specifics. While rising up for a rebuild has its challenges, it’s not impossible. West-

ern Golf and Country Club in Redford Township set that example a few years ago when its 92-year-old clubhouse burned to the ground. Two years later, after a multimillion-dollar investment and an undisclosed amount of insurance proceeds, it completed construction of a new clubhouse, though it is less than a third the size of Oakland Hills’ 110,000-square-foot structure. For clubs as old as Oakland Hills, loss and disruption are part of survival. Bayview Yacht Club, founded in Detroit in 1919 has had ups and downs, said rear commodore Mike Helm. Shortly before completing a $5 million renovation of the 86-year-old clubhouse, its temporary meeting place, a tugboat, sank into Connor Creek. Keeping members engaged and informed helped keep the club’s business afloat.

“The concern was how we were going to try to keep everyone happy the best we could through the challenges,” Helm said. Putting up tents in the parking lot, rolling out astroturf and buying a food truck were among the actions Bayview took to keep its members entertained without a clubhouse. Bayliss said the rebuilding process is likely to be arduous, but he’s confident Oakland Hills can tough it out. “They’ll be all in,” he said. “They’ll give it all their attention and put all their skills into it. The bottom line is, they care about the place. It’s a second home.”

“IN THE COMMERCIAL REAL ESTATE WORLD, IT STILL WAS A TRADITIONAL MEN’S BUSINESS. IT WAS A WHITE MAN’S BUSINESS. IT WAS JUST RARE (TO HAVE A BLACK BROKER).”

I did have several people who I’m still friends with now at Coldwell Banker who said, “Terry, you’ll be good at this.”

people smart or dumb to be working in real estate downtown. We did realize in 1994, Dennis Archer was elected. There was a lot of energy. People were excited about business in downtown Detroit. So that’s kind of when we came, at the exact same time. The electricity was just flowing about real estate opportunities in Detroit and that’s how we were able to make our name for ourselves, becoming Detroit’s commercial real estate firm. It’s always been Chuck and I until recently. We had a transition. Chuck wanted to slow down and he sold his share to a netlease group in Bloomfield (in February 2020).

younger people and I’m looking to bring in one more younger person.

— Terence Edmondson, Exclusive Realty

` In a lot of ways it’s the same, I’m sure, but in what ways was it different back in 1992 or 1994? In the commercial real estate world, it still was a traditional men’s business. It was a white man’s business. It was just rare (to have a Black broker). But

` What do you think sets you apart? And what advice would you have? They kind of go together. Build long-term relationships. Some of my best friends to this day were my clients starting off. I’m not talking just business. We go on vacations together. They are people who call me for referrals. Build your relationships. To that effect, make commissions your second-most important (thing). ` Talk a little about the trajectory of Exclusive. In 1994, Chuck Mady and I — he was at Vigliotti — and we came together. We liked to say we were the only two

` What do you see as the future? It was always Chuck and you. I have more people here. I have two

Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

` Do you view that as a succession planning sort of thing? I do. As long as I’m having fun, and it’s not like, “Aw, shoot, I have to get up and go to work,” I’ll keep doing it. I have to keep having fun. I try to tell people who I speak to, especially the young people, there are very few businesses you can make as much money as you can make in commercial real estate, and have fun doing it, which is what it’s always been to me. It’s been something fun, to negotiate deals and bring deals to closure. It’s just been fun. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

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DEMOLITION

Detroit Mayor Mike Duggan’s administration has placed a priority on increasing Detroit’s competitiveness to attract this segment of the industrial market, but the number of sites that currently meet industry criteria is limited,” the Detroit Future City report reads. Detroit Future City also recently teamed up with the Southwest Detroit Business Association to look at a pressing, related problem: How to attract investment to vacant industrial properties in a way that provides sustainable, middle-wage jobs and doesn’t exacerbate the city’s already ever-present environmental justice problems.

From Page 3

In fact, much of the work done with that $95 million won’t actually include full-on razing of buildings, she said. Pending City Council approval, Mayor Mike Duggan’s administration plans to identify industrial sites and do pre-demolition work that shows a property is worth considering for a private developer. Sherard-Freeman said the city would “love” to put the long-languishing Packard Plant on the list of Dick sites for which it invests in some amount of pre-development work, like environmental or land assembly, for example. But right now it’s suing owner Fernando Palazuelo to foot the bill for demolishing the site’s dilapidated buildings. First there’s a lot of work to be done determining what, exactly, ARPA rules allow and what makes sense for the administration to propose to City Council, she said. It’s unlikely ARPA money would be used for a full tear-down of an industrial site, she added. But it’s not just about huge old factories. Detroit also wants to spend more money cleaning up neighborhood corridors — including demolition, fixing up vacant commercial buildings, removing plant growth and fencing and cleaning up trash. And it hopes to fund some of that work with this traunch of ARPA funds, said Brad Dick, Detroit’s group executive of services and infrastructure. That would include employing 15 teams of six workers each for corridor cleanup, up from two teams. “Our focus is on removing the structures that are dilapidated and causing a blight in the neighborhood,” Dick said. “... It encourages other businesses to come in.” But the city doesn’t necessarily want to spend public dollars on work a building owner should be doing, he added. “We’re giving them a chance to do this, but we’re also starting to now hold property owners accountable, too. We’re going after them with a ticketing approach and a chance to remediate the property,” he said.

How much demolition? A 2019 report by nonprofit Detroit Future City, which contemplated adaptive reuse of the city’s vacant industrial building stock, estimated more than 800 vacant industrial properties totaling more than 6 square miles lie in Detroit’s borders. The city cannot yet say how many buildings would actually be demolished with these ARPA dollars, Detroit Demolition Department representative Ryan Foster said in an email. The city also would not provide a list of targeted properties to Crain’s. “However, we have moved forward with requesting ARPA funds for roughly 100 properties that have been identified as priorities by the City,” Foster wrote. The “vast majority” of commercial buildings the city believes need to come down are along major neighborhood corridors, Dick said. The demolition department expects commercial demolition work to ramp up in mid- to late 2023, she added.

Federal windfall

The dilapidated Packard Plant in Detroit is among the higher-profile commericial properties the city would like to see cleared for future development.

The city demolished 26 commercial buildings in 2021, according to a city representative. Nineteen were considered emergencies and seven were regularly scheduled demolitions. The total commercial demolitions Detroit completed and/or contracted out totaled $2.2 million, according to public data the city posts online. In 2020, Detroit demolished 47 commercial buildings at a cost of $1.8 million. That was down from 137 total commercial demolitions in 2019 at a cost of $10 million, and just less than 150 demolitions each in 2018 and 2017, totaling $7.6 million and $8.1 million, respectively. For comparison, the city has cleared 1,358 homes so far under the Proposal N program, which started in spring 2021. That work, plus securing 280 homes for future privately funded renovation, has cost $26.6 million so far. “Residential demolition has always been a priority and will continue to be a priority,” Foster said in the email. “Of course, now that a funding source has been identified for commercial, we do anticipate an increase in commercial demolitions over the next few years. Blighted structures pose a danger to the community, and these ARPA funds are simply another tool to address more of these structures across the City.”

Good plan, but not perfect Kyle Morton, vice president of development for Ashley Capital, calls land assemblage a “really complicated task.” “(The $95 million) is a good first step, but it’s not a perfect solution to get all these (projects) moving forward,” he said. Ashley Capital, a New York-based industrial and warehouse developer, has been active in redeveloping large sites in metro Detroit. That includes the 450,000-square-foot Means Logistics Park in Detroit and Highland Park — a challenging development when it came to parcel assembly, zoning and street vacation, as well as the sudden death of its top champion, Eric Means. Ashley is also a minority partner in an industrial/warehouse development in southwest Detroit as part of a Black-owned business campus. Any help from the city on the complex processes of assembling land, getting it rezoned for new use, starting any necessary demolition work or dealing with environmental contamination is good and makes a site more attractive, Morton said, as Detroit lacks “easy” sites to choose. He said Ashley Capital has been tracking the city’s land assemblage process and looking for opportuni-

ties, but “it’s really a city administration decision” where projects can go. “There’s no creating land in Detroit ... it’s a built-out city that has old infrastructure and old street networks,” Morton said. “If they had a piece of land to help jump-start that process it would be great.” Sherard-Freeman said there are national companies she thinks will be interested in these properties once the city shows it’s making an investment in them. But developers need to do their part, too. Ashley Capital is “excited to see where this goes,” Morton said. He wants to see Detroit nab supplier plants and other job sites that can keep workers in Detroit instead of sending them to the suburbs. The east-side Stellantis auto plants, for example, drew supplier interest including from Dakkota Integrated Systems, and General Motors Co.’s Factory Zero drew Lear Corp. “Large manufacturers are typically seeking cleared land on which to build or turn-key facilities that can be made available quickly and easily.

States, cities and counties got a total $350 billion in funding aimed at helping them recover from the pandemic and the recession it created. Detroit’s share of that is $826.7 million. “In the end, what the ARPA funding should do at large is create the next iteration of Detroit,” Sherard-Freeman said. “All this stuff ought to hang together so that when we turn back 20 years from now we see, ‘Oh, man, that ARPA funding ... was the watershed moment.’” It’s a historically large monetary windfall for the city, equaling around 80 percent of a full annual budget. Planned spending includes more than $400 million to help the city’s budget recover from losses due to the pandemic; $41 million for parks, street improvements and arts investments; $40 million for business assistance; and $67 million to fight “intergenerational poverty.” So far the city has spent $7.2 million in ARPA funds, including on senior home repair, payroll, alley cleanup, and city services and infrastructure. Detroit needs to allocate all its funding by the end of 2024 and actu-

ally spend it all by the end of 2026. Of the $95 million earmarked for “addressing the elimination of commercial and industrial blight through demolition, remediation, and land reuse,” $33,266 has been spent so far on payroll and $1.35 million has been encumbered so far for a housing resource navigation project, according to city documents detailing ARPA spending. One big concern about ARPA spending is whether or not it’s getting into the hands of “working-class people” who need it, said Branden Snyder, executive director of Detroit Action. One thing the activist organization has been doing is looking at how the city is spending that federal money. Though the city held community meetings asking for input on how to spend the influx of cash, there’s been continued concern that residents’ voices haven’t been considered enough in how the money is being spent. “I don’t think they’re using (the money) effectively,” Snyder said. “(The spending on blight remediation) goes to show the city, in how it’s spending on development and economic development, is really misplaced.” He called it “trickle-down economics” hoping to lure big companies into town with no guarantees. Snyder acknowledged money is going to programs along the lines he sees as beneficial: putting Detroiters back to work and repairing older homes, for example. But he says it’s not enough. “There’s still a need for low-income and moderate-income folks to be able to buy homes in the city … there’s still a need for small businesses to have access to capital and access to facilities,” he said. Contact: afrank@crain.com; (313) 446-0416; @annalise_frank

ENERGIZING MICHIGAN’S ECONOMY How energy infrastructure can attract and retain business Michigan is facing a critical point in the rapidly changing energy landscape. At the same time, new manufacturers — electric vehicle and others — are looking to locate, or expand operations, in our state. Join us for a discussion with experts about why investment in energy infrastructure is key to the future of our state’s economy and Michigan’s strategy to attract and retain these economic growth opportunities.

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Brian Rich Sr VP / Chief Customer Officer Consumers Energy

Simon Whitelocke President ITC Michigan

Josh Hundt Chief Business Development Officer, EVP MEDC

Maureen Krauss President and CEO Detroit Regional Partnership