Crain's Detroit Business - March 28, 2022 issue by Crain's Detroit Business

THE CONVERSATION Doner CEO David DeMuth wants employees to see the office as a ‘destination’. PAGE 18

ENERGY: DTE, Consumers plan big for solar — and they’ll be on hunt for land. PAGE 3

LAURÉN ABDEL-RAZZAQ/CRAIN’S DETROIT BUSINESS

SHERRI WELCH/CRAIN’S DETROIT BUSINESS

LAURÉN ABDEL-RAZZAQ/CRAIN’S DETROIT BUSINESS

CRAINSDETROIT.COM I MARCH 28, 2022

Artist Tyree Guyton started the Heidelberg Project on Detroit’s east side more than 30 years ago. Jenenne Whitfield, the longtime head of the project, is departing the organization for a new role in Baltimore.

WHAT’S NEXT FOR HEIDELBERG PROJECT?

BY SHERRI WELCH

Jenenne Whitfield, the longtime head of the Heidelberg Project in Detroit, is departing the organization for a new role in Baltimore, a development that calls into question who will champion the internationally known nonprofit and its art going forward. Whitfield will leave Detroit to lead the American Visionary Art Museum in Baltimore in September. There she will suc-

ceed AVAM’s founding director and primary curator Rebecca Alban Hoffberger, who is retiring. “Jenenne’s long tenure with the Heidelberg Project, one of our nation’s most respected mission-driven artistic endeavors, is a testament to her commitment to enliven local communities and give voice to the concerns of our day through original and inspired artistic expression, also core to AVAM’s mission,” the museum’s Chair Christopher Goelet said in a news release. Whitfield has been with Heidelberg for 28 years. She took

Duggan targets ‘top 100’ commercial blight buildings A wide variety of vacant commercial buildings in Detroit — from a former strip club to empty schools — are on a new list compiled by Mayor Mike Duggan’s administration targeted for demolition or redevelopment. Over the fall and winter, Duggan’s administration has been putting together what it calls the M100 — internal shorthand for the “mayor’s 100.”

See HEIDELBERG on Page 16

FORUM ROADS | PAGE 8

It’s a color-coded, regularly changing spreadsheet that lists addresses around the city that the mayor’s office sees as the most prominent commercial eyesores to be cleaned up. It’s a new methodology for tackling Duggan’s long-stated objective of ridding the city of blight — one on which he opined in his re-election victory speech and most recently his State of the City address. See BLIGHT on Page 16

NEWSPAPER

THESE ‘DAMN’ ROADS

Why Michigan can’t fix its deteriorating transportation infrastructure.

P001_CD_20220328.indd 1

NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

BY ANNALISE FRANK AND KIRK PINHO

over as president and CEO five years ago when her husband, Heidelberg artist Tyree Guyton, stepped back from the educational nonprofit that evolved from the Detroit arts installation he built from reclaimed items over 30 years. The two will remain on the board of the nonprofit Heidelberg Project and keep their Detroit home, along with a new residence in Baltimore, Whitfield said.

3/25/2022 1:59:10 PM

NEED TO KNOW

THE NEXT ACT

THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT  LAWMAKERS OK $4.8 BILLION SPENDING BILL

 SHIRKEY ENDORSES TUDOR DIXON FOR GOVERNOR

THE NEWS: Michigan lawmakers approved $4.8 billion in spending, mostly for infrastructure upgrades, with an influx of federal pandemic and other funds that will go toward water systems, roads, parks and other priorities including affordable housing.

THE NEWS: Senate Majority Leader Mike Shirkey has weighed in on the crowded field of fellow Republicans seeking to take on Democratic Gov. Gretchen Whitmer, endorsing conservative commentator Tudor Dixon for the Republican nomination. The Jackson County Republican said Dixon would govern more like Florida Gov. Ron DeSantis than Whitmer during the height of the COVID-19 pandemic.

WHY IT MATTERS: The spending proposal was overwhelmingly approved on a bipartisan basis after months of debate on spending priorities.

 SUPREME COURT TO HEAR FLINT WATER ARGUMENTS THE NEWS: The Michigan Supreme Court is getting more involved in Flint water criminal cases after agreeing to hear arguments in May about whether a one-person grand jury violates the state Constitution. The court on Wednesday added Nick Lyon’s case to the May 4 docket. WHY IT MATTERS: Nine people, including former Gov. Rick Snyder, were indicted by a judge who was serving as a grand juror while considering evidence presented by the attorney general’s office. It’s a very unusual way for prosecutors to charge people in Michigan.

WHY IT MATTERS: The endorsement gives Dixon credibility in a GOP race that has yet to produce an obvious front-runner.

WHY IT MATTERS: Its another massive automaker investment in an electric future that’s close to home in metro Detroit.

 ROCKET MAKES FIRST FORAY INTO BASEBALL MARKETING THE NEWS: Starting this spring at Comerica Park, you’ll be able to ponder a 30-year fixed rate mortgage with your peanuts and Cracker Jack. Rocket Mortgage and the Detroit Tigers on Tuesday announced a new deal for the Detroit-based mortgage lending giant to becom e the “exclusive mortgage partner” for the MLB team. WHY IT MATTERS: Rocket has sponsorship deals seemingly everywhere, but this deal marks its first in Major League Baseball.

Ex-GM exec Ammann gets new job with ExxonMobil  Dan Ammann, the former General Motors Co. president who was abruptly dismissed from his post as CEO of Cruise LLC in December, has been named president of ExxonMobil Low Carbon Solutions. Ammann will replace Joe Blommaert, who is retiring after 35 years with the company. Ammann’s appointment is effective May 1, according to a company statement. Ammann, 49, had been CEO of self-driving vehicle company Cruise since 2019. GM now owns 80 percent of Cruise. Ammann was president of GM from 2014 to 2018 and the automaker’s CFO from 2011 to 2014 after more than a decade as a Wall Street banker. He recently sold the Fisher Mansion in Detroit’s Palmer Park neighborhood to Stellantis COO Mark Stewart. He said in a LinkedIn post that he will lead the building of new business at ExxonMobil focused on the decarbonization of the industrial economy.

 HEGIRA, COMMUNITY CARE MERGE OPERATIONS

 WINDSOR TO GET NEW STELLANTIS-LG BATTERY PLANT THE NEWS: Stellantis and joint venture partner LG Energy Solution Ltd., with backing from three levels of government, committed Wednesday to spending $4.1 billion to build Canada’s first large-scale EV battery plant in Windsor, Ontario.

THE NEWS: Wayne County nonprofit service providers Hegira Health Inc. and Community Care Services have merged. The deal between the two behavioral health care providers was finalized on March 20, about six months after it was announced. Terms were not released. WHY IT MATTERS: The combination creates one of the largest mental health and substance abuse treatment systems in Wayne County.

Dan Ammann | BLOOMBERG

ATTRACT TOP TALENT

AS A 'COOL' MICHIGAN WORKPLACE Get employee feedback, competitor insights and more.

LAST CHANCE! APPLY BY APR. 1 | crainsdetroit.com/cool-22 2 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P002_CD_20220328.indd 2

3/25/2022 12:59:34 PM

ENERGY

O’Shea Solar Park in Detroit | MARK HOUSTON

ON HUNT FOR SUN

Utilities seeking massive tracts of land for solar development BY CHAD LIVENGOOD

DTE Energy Co. is in the market for 20,000 to 35,000 acres of southern-facing flat land in Michigan to erect solar arrays over the next 10 to 15 years. Consumers Energy Co., which generates 40 megawatts of electricity from solar today, has plans to be at 8,000 megawatts of energy from the sun by 2040, requiring anywhere between 40,000 and 56,000 acres of land for solar arrays. With the cost of solar power more economical than ever, it still

requires lots and lots of space. Michigan’s utilities are moving quickly to scoop up the real estate needed to rapidly expand their solar energy generation capabilities amid consumer demand for accelerating a transition away from carbon-emitting coal power plants linked to global climate change. “We’re securing as much land as we can at this time to help enable that to develop,” DTE Energy CEO Jerry Norcia said in an interview with Crain’s. The shift away from centralized electricity generation to one that

requires vastly more acres to cover with panels facing the sun — and covering what’s below them — is causing the utility companies and solar developers to search for real estate that both meets customer demand while balancing the best use of land. It’s an issue policymakers in Lansing have not yet tackled, but energy industry leaders expect they will face it soon as some communities may resist solar panels lining farm fields. “My expectation is at some point — we haven’t hit it yet here in Michigan — land use is going to

be an issue,” Norcia said. “In areas where you have highly productive agricultural land, when you put solar panels over that land, you’ve essentially changed that land use for a long, long time. I think that’s going to be an emerging challenge over time.” DTE Energy (NYSE: DTE) is currently generating 144 megawatts of electricity from solar and plans to add 1,000 megawatts by the end of 2024 and 4,000 more megawatts within the next decade to 15 years, Norcia said.

“MY EXPECTATION IS AT SOME POINT — WE HAVEN’T HIT IT YET HERE IN MICHIGAN — LAND USE IS GOING TO BE AN ISSUE.” — Jerry Norcia, CEO, DTE Energy

See SOLAR on Page 15

REAL ESTATE

Spring homebuying season already a ‘frenzy’ in metro Detroit BY ARIELLE KASS

It’s just the beginning of the spring homebuying season, but real estate professionals say the metro Detroit housing market is already as crazy as it was last summer. “It’s bonkers,” said Megan Tooley, a principal agent with Redfin. “Right now, it’s more competitive than it was at this time last (year). ... Now, if you’re going in at list price, you’re almost guaranteed to lose.” Last June, median sales prices in the region rose 18.4 percent from June 2020 to $244,000 for a single-family house, according to data from the multiple listing service Realcomp — the highest price recorded for any month going back to 2003. At the same time, the

Redfin is reporting that nearly three quarters of homes for sale in metro Detroit are receiving multiple offers. And agents are saying that in order to win a bid, buyers are having to go well above list price. | GETTY IMAGES

number of showings rose to 13 from just over 11, the number of days a house was on the market fell to 22 from 60 and most sellers got more than list price on their homes. Now, Redfin is reporting that nearly three quarters of homes for sale in metro Detroit are receiving multiple offers. And agents are saying that in order to win a bid, buyers are having to go well above list price. But they also are throwing in free occupancy for sellers worried about their next destination, appraisal guarantees in case the frenzied market doesn’t keep up with appraisals and even paying closing costs so sellers can keep more money in their pockets. First-time homebuyers and those with government-backed loans are at a distinct disadvantage in the

market, agents said. Even those able to pay top dollar are facing stiff competition. Tooley said a colleague made an offer for a client on a $1.2 million home. The all-cash offer, at $100,000 over asking price, was still a loser. On a house in Canton Township that was listed at $449,000, Tooley’s client offered $520,000 with an appraisal guarantee but lost to someone who offered $536,000. And when Tooley listed a Lima Township house for $359,900, hoping competition would allow it to sell for $375,000 or $380,000, even she was surprised that the winning bid of eight offers was $405,000, plus $20,000 in closing costs. See FRENZY on Page 15 MARCH 28, 2022 | CRAIN’S DETROIT BUSINESS | 3

P003_CD_20220328.indd 3

3/25/2022 3:31:46 PM

REAL ESTATE INSIDER

This would be largest apartment project in Birmingham since 1980 The largest apartment development in Birmingham since the Jimmy Carter administration is moving its way through the municipal approval Kirk process. PINHO The development proposed at 770 S. Adams and 1000 Haynes in the city’s Triangle District, east of Woodward Avenue and the central business district, would have 157 units, dwarfing virtually everything else put before the city for consideration in recent memory — and consisting of the second-most number of for-rent units that have ever been constructed in one development in city history. According to data provided by CoStar Group Inc., a Washington, D.C.based real estate information service, the largest apartment development in Birmingham is the garden-style Eton Square at 1997 Villa Road — with 158 units renting for an average of less than $1,400 per unit and built in 1980, a year before Ronald Reagan took office. This, on the other hand, would be luxury units a stone’s throw from downtown. The development site currently consists of an office building and a Citizens Bank branch and sits tucked behind the Walgreen’s drug store and Papa Joe’s grocery store on Woodward. The proposal consists of virtually an entire city block, although the former Plant Station property at 720 S. Adams in the northeast chunk of the block bounded by Haynes to the north, Adams to the east, a public alley to the south and Worth Street to the west, is not part of the development proposal. The project is being proposed by Randy Wertheimer, CEO of Farmington Hills-based developer Hunter Pasteur Homes; Anthony Soave, founder of Detroit-based Soave Enterprises; and Nathan Forbes, managing partner of Southfield-based Forbes Co., which owns Somerset Collection in Troy. Forbes and Hunter Pasteur have been known financial partners on real estate in Detroit in past projects, including the Godfrey Hotel and its related multi-

A rendering of the proposed 157-unit apartment development in Birmingham in the city’s Triangle District at South Adams and Haynes. | SCREENSHOT

family component in the city’s Corktown neighborhood west of downtown; Soave also has the Elton Park development in Corktown nearby. Through a spokesperson, all three declined comment until after a March 31 Birmingham City Commission meeting. The development cost is not known, although it could be north of $100 million. The project is a much larger plan than an effort in 2020 by longtime Birmingham developer John Shekerjian, said Michael Poris of McIntosh Poris Associates, who was the architect on that previous project. When financial aspects of acquiring additional property for the project fell through, he brought on Wertheimer, Soave and Forbes as partners, Poris said. The architects on the new project are Neumann/Smith Architecture and Christopher J. Longe Architecture, planning board documents say. The building would include about 4,000 square feet of retail space in an area along Haynes, but no commercial space along South Adams which is a deviation from existing city frameworks, according to a development proposal overview. The document says that although South Adams commercial space is not required under the city’s Triangle District Urban Design Plan, it “describes a vision where commercial uses in the heart of the Triangle and along Adams should be oriented more towards serving the immediate neighborhood.”

The mixed-use building (left) proposed by Ron Boji on property owned by David Trott would sit next to the proposed RH store (right) at Old Woodward and Brown in downtown Birmingham. | SCREENSHOT

That’s been a bone of contention for some members of the Planning Board, who are calling for retail along Adams, Downtown reported earlier this month. A representative of Soave Enterprises said Adams parking limitations pushed retail space to other parts of the project, Downtown reported in January. The proposal would also get rid of a pair of surface-level parking lots and replace them with a 4 1/2-story parking deck with 266 spaces, 57 more than required by zoning rules.

Elsewhere in downtown Birmingham mixed-use development ... The city’s Planning Board is considering developer Ron Boji’s plan for a new 102,000-square-foot, four-story building at 294 E. Brown St. next to the proposed RH building at South Old Woodward and Brown Street that’s expected to start construction next month. The 65-foot Boji development would include 38 residential units on the top two floors, along with 6,700 square feet of retail and 7,800 square feet of office space on the first floor and 26,400 square feet of office space on the second floor plus below-grade parking with 59 spaces, according to Planning Board documents. The property is currently a 6,800-square-foot office building on a site owned by an entity registered to

Kathleen Trott, wife of former Republican congressman David Trott, who has also registered various business entities at the same Elm Street address. The development is closely connected with the new RH store about to commence after years of debate in the swank Oakland County community. It’s been one year and two days since it was revealed that the plan for an RH (formerly Restoration Hardware) flagship store for downtown Birmingham had been revived at a different location: On the property immediately east of the planned new Boji/Trott building. A previous location had been torpedoed. The new plan for the new RH store calls for it to be built at the southwest corner of Old Woodward and Brown across the street from the new Daxton Hotel, rather than a four-acre site farther north in the central business district. The 1.24-acre site, which consists of properties at 300-394 S. Old Woodward Ave. and 294 E. Brown St., currently is home to Capital Tile, Lutz Financial Services, Roche Bobois, Frank’s Shoe Service and Coldwell Banker Weir Manual, according to a Planning Board briefing memo from a year ago. The buildings on that site, at 300 S. Old Woodward Ave. and 394 S. Old Woodward Ave., are expected to be demolished as part of the plan to make room for the new 54,000-squarefoot building that would have RH as

an anchor tenant, plus a restaurant on the top floor and one level of underground parking with 24 spaces, according to the memo. Corte Madera, Calif.-based RH (NYSE: RH) is the owner/developer for that site. In 2019, a development team called Woodward Bates Partners LLC — consisting of local commercial real estate royalty Victor Saroki, Boji, John Rakolta Jr. and Paul Robertson — planned a 55,000-square-foot RH store, plus 30 rental residential units, 25,000 square feet of office space and a total of about another 10,000 square feet of retail space across multiple buildings. In addition, there would have been 1,159 parking spaces and a 530-foot extension of Bates Street to the northeast. It would have cost $140 million. However, that plan was scotched in August 2019 when Birmingham voters turned down a $57.4 million parking deck bond for the project. Although that project’s roots can be traced to the mid-1990s and the adoption of the Downtown Birmingham 2016 Master Plan, the project began moving forward in earnest in May 2016, when the city issued a request for qualifications for developers to develop the approximately 4-acre property west of Old Woodward Avenue and north of Willits Street at the north end of downtown. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

COURTS

Art Van bankruptcy lawsuit seeks more than $105M from family BY DUSTIN WALSH

A trustee for the federal bankruptcy court is attempting to claw back more than $105 million from the family behind shuttered metro Detroit furniture empire Art Van Furniture — and the estate of late founder Art Van Elslander. The complaint, filed on March 7 in Delaware bankruptcy court by Chapter 7 trustee Alfred Guiliano, alleges the sale of most of Art Van’s real estate done in concert with the sale of the company to Boston-based private equity firm Thomas H. Lee Partners in 2017 is directly responsible for the company’s insolvency. The family denies that claim. Guiliano filed the complaint on behalf of creditors who lost money in Art Van’s bankruptcy. A bankruptcy trustee’s role is to try to recover as much money for a bankrupt company’s creditors as it can. The Warren-based retailer first

The Van Elslander family bought back the Art Van Furniture name out of bankruptcy in 2021. | CRAIN’S DETROIT BUSINESS

filed for Chapter 11 reorganization in March 2020 before moving to a Chapter 7 liquidation a month later. The complaint alleges real estate sales three years before the bankruptcy filing left the company with

no assets and sealed its eventual fate. The complaint said properties Art Van previously owned outright were sold for $434 million in a deal that involved leasing the property back to Art Van, and 70 percent of the sales

total was used to finance the sale to Thomas H. Lee. “Prior to the Art Van Acquisition, the company paid less than $23 million per year in total lease obligations and had $136.5 million in total future lease obligations,” the complaint reads. “After the Art Van acquisition, and as a direct result of the sale-leaseback transactions used to finance the bulk of the avoidable transfers to defendants, the debtors’ minimum lease obligations ballooned to nearly $46 million per year and more than $877 million in total future operating lease obligations.” The complaint states Gary and David Van Elslander, sons of the late Art Van Elslander, and former CEO Kim Yost each received “multimillion-dollar” payments from the real estate sales. The Van Elslander trust received more than $529 million from the $629 million sale of the company. Art Van Elslander’s children received

more than $75 million as part of the deal, according to the complaint. The complaint doesn’t name Thomas H. Lee Partners or seek to claw back any funds from its role as the initiator of the sales and leasebacks as part of the M&A deal. Not only did the private equity firm use 70 percent of the proceeds of gains from the property sales to purchase Art Van, it loaded the company with $254 million in new debt obligations, according to the complaint. The Van Elslander family believes Thomas H. Lee is to blame for the bankruptcy. “Make no mistake, the bankruptcy proceedings may be labeled ‘Art Van,’ but this is about the consequences of business decisions made by the company that purchased our family business in 2017,” the family said in a statement. Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

4 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P004_CD_20220328.indd 4

3/25/2022 12:55:26 PM

SPONSORED CONTENT

CARING FOR KIDS Positively impacting Michigan kids and their families every way possible 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 March 22; listen to the entire episode, and archived episodes, at yourchildrensfoundation.org/caring-for-kids

Shawn Wilson

Suzanne Miller Allen

President & CEO, The Boys & Girls Clubs of Southeastern Michigan

Senior Director, Community Responsibility and Social Mission, Blue Cross Blue Shield of Michigan

Kevin Brown Director, Community Impact, Ilitch Sports + Entertainment LARRY BURNS: Shawn, what are your key strategic initiatives for the Boys & Girls Clubs? SHAWN WILSON: When I started three

years ago, the organization was on the verge of going out of business. It had over a million dollars in debt — we were closing clubs. In my first 100 days as a CEO, I met with over 300 community stakeholders and led visioning sessions and benchmarking WILSON tours. I asked the community, “How do we re-imagine this club for greater impact?” The answer was to treat the root cause of the issue facing our youth, which is poverty or lack of economic mobility opportunities. We reimagined our mission with the following focus: career-ready, from a standpoint that they can earn a livable wage; startup, meaning they can start their own business; and home ownership, because that’s the backbone of wealth-building in our country. Because of our new mission, our numbers have exploded. We went from 5,000 registered members to 14,000 in three years, and 12,000 to 21,000 total served in a year.

Burns: Tell us about your facilities and programs. Wilson: We look at our facilities as economic mobility hubs for the neighborhood. We merged with Ponyride, another nonprofit in Southwest Detroit. Our youth are able to get internships and apprenticeship programs with these entrepreneurs. They’re able to see entrepreneurs who look like them — who maybe grew up just a few blocks away from the club. Entrepreneurship is a big piece of what we’re doing in our clubs now, but at the end of the day, it goes beyond just placemaking. It’s a place where entrepreneurship happens for not only our youth, but black and brown businesses and neighborhoods. We’re putting back about a million dollars a year into minority-owned businesses because of the work we’re doing and that translates to better communities. Burns: What’s your vision for 2022? Wilson: As we’re coming out of COVID, it’s an opportunity to scale the work. By the end of this year, we’ll have five Esports lounges and Egaming lounges in partnership with The Children’s Foundation and the Detroit Red Wings. That’s a huge hook for our kids. Burns: Kevin, how do you take the Red Wings brand from the ice to the Red Wings Foundation? KEVIN BROWN: We’re proud of the work we are able to accomplish every day to make our community stronger. We focus on supporting youth through education, wellness and sport participation programming. Burns: What are some of the things in front of you for 2022? Brown: The Red Wings Foundation, in partnership with the National

Hockey League, the NHL Players Association, and the team, has a new platform in the city of Detroit called Learn, Play Score. This platform was developed out of a million-dollar commitment on behalf of these organizations to impact the lives of kids through the sport of hockey and to rethink the game as it relates to how it’s deployed in the city of Detroit. It’s all about finding those opportuni-

P005_CCB_20220328.indd 5

ties for access and experiences that may help a kid to see themselves in the game. Burns: Shawn, how did the Boys & Girls Clubs of Southeastern Michigan get involved with the Red Wings Foundation? Wilson: We were re-imagining our

facilities and the impact that we wanted to have. Kevin and the Detroit Red BROWN Wings became one of our early adopters. They invested in that vision with the first innovation lab and Egaming center. Over the last couple of years, we’ve been able to do some amazing work exposing kids to floor hockey and to NHL hockey via Esports. Burns: Kevin, what attracted you to the Boys & Girls Club?

LARRY BURNS: Tell us about your role at Blue Cross Blue Shield of Michigan. SUZANNE MILLER ALLEN: In my role, we oversee our charitable and philanthropic giving and community partnerships. Blue Cross Blue Shield is the largest private funder of our free clinics across the state of Michigan, which is done through our social MILLER ALLEN mission area. We also fund the Building Healthy Community school grants. We give in all 83 counties and we have partners all across the state. Burns: You’re also a partner of The Children’s Foundation. How does supporting an event like our Child & Adolescent Behavioral Summit tie into your mission?

Brown: As we were building out Learn, Play, Score, we reviewed what Shawn and his team were doing at Boys & Girls Club and it was a no-brainer that we find a way to work together. From that conversation, we were able to grow a three-year, $300,000 pilot program with the Boys & Girls Clubs, The Children’s Foundation, and the Detroit Red Wings Foundation called Esports + Hockey.

Miller Allen: This summit is an opportunity to help our partners

Burns: Shawn, tell us about the programs being created.

Burns: What are some of the other programs we’ve partnered on?

Wilson: One of the biggest programs is the Esports league, Egaming. We want them to become tech entrepreneurs and become the next game designers. Also, of course, there’s floor hockey — all you need is a pair of sneakers and a will to go. Our workforce and entrepreneurship development program, the Esports and Sports Industry Club, will help the youth go behind the scenes to see different careers that are available in these industries. Burns: Kevin, how will this work with the Red Wings and The Children’s Foundation?

learn more. One of the things we have worked on is children’s health, particularly behavioral health. The pandemic has not been good for our kids’ mental health. This summit helps give people the tools and the knowledge of best practices, and features speakers and practitioners.

Miller Allen: TRAILS, Transforming Research into Action to

Improve the Lives of Students, is a mental health program that started out in Ann Arbor schools with the University of Michigan and Blue Cross Blue Shield. The Children’s Foundation is funding the expansion of this program into the Detroit Public Schools. It offered training for the staff of the Detroit district to help them learn about students and to teach some of the social and emotional learning components that help students cope.

Brown: Esports + Hockey provides accessibility and experiences for kids year-round. We’ll be able to engage with kids in three different semesters so that the number of kids that end up being impacted at the end of the year is in the hundreds.

I would also like to mention the work we’ve done on suicide prevention. The grants from The Children’s Foundation helped focus on kids that were at risk, to identify them, get them rapid follow-up and care transition, and then try to expand capacity for treatment.

Wilson: If anyone has lived in blighted communities, they

We’ve also worked on the opioid issue together, funding the Jamie Daniels Foundation along with you.

understand the trauma that comes with that. From a mental health standpoint, from a social and emotional standpoint, the workforce development piece that the three of us are collaborating on has a long-term impact on youth mental health. It’s so important to provide those mental health services when the youth come into the clubs. But by addressing economic mobility, we’re addressing mental health and social and emotional needs long term.

Burns: What’s the timeline to get these programs rolling? Wilson: We started piloting over the last couple of years and started

to ramp it up recently. Now, we’re at a point of scaling.

Brown: Moving forward, whenever you see a scoreboard message at Little Caesars Arena, all of those contributions that our fans make in order to place those messages will now go toward supporting the Esports + Hockey initiative with help from our friends at The Children’s Foundation.

Burns: You’ve created a consortium of funders. Tell us about that. Miller Allen: What we have tried to do is to cultivate relationships

with partners across the state and bring people together. We have been successful and The Children’s Foundation has been part of that. At the end, you have a lot of funding and also the different connections that every organization has.

One of our charitable focus areas for the year is on child abuse and prevention. Our CEO, Dan Loepp, and his wife, Amy, are chairing the Children’s Trust Fund Signature Auction on May 17. April is National Child Abuse Prevention and Awareness Month. We are building pinwheel gardens — the symbol of child abuse awareness — across the state. We want to let people know the signs, and the ways that they can get involved.

3/25/22 1:54 PM

COMMENTARY

Time is now to make Detroit an international rail gateway

DANIEL SAAD FOR CRAIN’S DETROIT BUSINESS

BY DAVID FRIEDRICHS

EDITORIAL

Wanted: A sustainable future for our roads I

n 2015, when Gov. Rick Snyder signed off on a plan to pay for road maintenance with increases in the state gas tax and vehicle registration fees, the consensus was that the $1 billion a year it would generate wouldn’t be enough to do much more than stave off continued decline. As Chad Livengood spells out in this week’s Crain’s Forum section, that prediction turned out to be accurate. It’s been a predictable result of state road funding policies that don’t dedicate enough predictable money — and nothing that’s happened since, including Gov. Gretchen Whitmer’s $3.5 billion bonding plan, has done much to fix that structural problem. Whitmer says her bonding plan is starting to work after lawmakers rejected her proposed 45-cent-per-gallon gas tax hike that would have produced $2.5 billion more annually for repairing roads and bridges. Borrowing for major fixes now was a good down payment on what the state actually needs, but it’s still a PASSABLE ROADS very large and expensive one-time BandARE KEY TO THE Aid. To get 80 percent of STATE’S roads in good or fair ECONOMY. condition (right now it’s 60 percent), MDOT pegs Michigan’s annual shortfall in road funding at $2 billion a year through the rest of this decade. Infrastructure like passable roads is key to the state’s economy. It’s the first experience an executive scouting corporate locations has with the state. The freeze-thaw cycle over the last month has been particularly brutal on the roads — as is apparent to anyone who has bottomed out

their car in any of the many sinkholes around town. The logical option as the automotive industry moves with increased speed toward electric vehicles is to find something to tax other than gasoline. There’s a simple solution that everyone can understand: A dedicated 1 percent sales tax would provide about $2 billion a year, roughly in line with what’s needed without much at risk from the EV transition. Short of that, Michigan’s Constitution could be amended to allow local regions, cities and municipalities to pursue local sales taxes dedicated to their roads. That would offer a way for cities that want to improve their roads a way to control their own destiny, rather than being dependent on money allotted by the state and federal government. This would be helpful to places with denser populations, where the roads simply take more wear. Michigan’s statewide 6 percent sales tax is on the high side nationally, but the state is unusual in not allowing localities to levy them. Michigan’s statewide sales tax ranks 17th-highest in the country, according to the Tax Foundation, but once you add in the average local sales tax, only 11 states have a lower total sales tax. Most big cities collect more than 6 percent. New York City’s total sales tax is nearly 9 percent; Chicago’s is over 10 percent. That reflects the increased costs, and also increased benefits for residents, of living in an urban area. Michigan needs similar flexibility. A local sales tax has problems, especially for cities with lots of pass-through traffic. But it would give an option for cities that want a steady stream of road funding — and provides a way to move control of pavement conditions closer to those who use the roads.

Great dreams of continental, even global, trade have captured the imaginations of those on both sides of the Detroit River for over 300 years. “Get Going On Gateway” was the editorial of Bridge Magazine in April 2012. The cry was to rise up and rally global intermodal trade through Detroit, on rail as well as roadways and Metro Airport’s aerotropolis. The idea, wrote Center for Michigan founder Phil Power, was to transform Michigan into a Great Lakes Global Gateway forged from our existing manufacturing and agricultural sectors. The vision called for adding continent-spanning rail infrastructure to create North America’s lowest-cost freight transportation center right here, in the industrial heartland. As critical transportation connectors, the key addition is a double-stack freight tunnel under the Detroit River would be a “trade companion” to the new Gordie Howe bridge and catapult Michigan into a new century of jobs, population and business growth. Earlier this year, when Amtrak announced its plan to expand offerings through Detroit, economic development veteran and rail enthusiast Marge Byington, based in Grand Rapids, realized the stars had re-aligned. From her years with the Department of Commerce and in economic development for Detroit, she said she’d learned “timing can be everything.” As a friend, she phoned me. We agreed: Now is the time. We also found ourselves applauding the cornerstone commitments to the city of recent years, private especially, but also federal and state infrastructure funds. For Marge, the field of dreams for Detroit is a Tunnel of Dreams, namely, a Continental Rail Gateway. Sized to handle double-stacked freight containers, a rail gateway would meet 21st century rail transport standards and be built right under the existing Detroit-Windsor rail tunnel Amtrak and Canadian Pacific Railway aim to transition to passenger service. The Continental Rail Gateway would also complement (and back up) the existing and equally valuable Canadian National double-stacked freight tunnel operating since 1995, Sarnia to Port Huron. And by the definition of intermodal, freight-by-rail supplements bridge commerce as insurance against all but nationally ordered border closures, which might have come in handy earlier this year when protesters closed the Ambassador Bridge.

A detailed construction plan for the rail gateway has been developed and resides with Canadian Pacific, sole owner of the existing rail tunnel, in talks with Amtrak and also a major U.S. expansion of its own. A 2012 study by Wayne State economist Michael Belzer found that a Detroit Gateway could reduce both costs and days of transit up to 20 percent. The supply chain benefits, he believes, will impact all sectors: manufacturing, agricultural and distribution. Referring to Detroit as a global freight gateway and inland port, Belzer concluded the city, county and state can leverage locations and assets with public-private partnerships to make Michigan the Midwest’s freight gateway to the world. Through several administrations, Michigan Department of Transportation, Michigan Economic Development Corp. and other state agencies have proposed one or more modern, efficient 21st century intermodal hubs in and around Detroit. These plans went on the shelf at the time of Detroit’s bankruptcy. The opportunities of this hour, this decade, A DETAILED are very different. So yes, timing may be ev- CONSTRUCTION erything. Cornerstone PLAN FOR THE commitments worth billions are in place. RAIL GATEWAY National tech firms are HAS BEEN leaning in and heading Detroit’s way. Can na- DEVELOPED. tional logistics and distribution remain at a distance? The vision of completing and connecting global markets, while lowering costs for both exporters and importers, is transformational. Taking advantage of Detroit’s unique geography and history to benefit all who share the continent’s heartland excites interest and will draw an enthusiastic crowd. That crowd is needed to build what’s already on the drawing boards, thanks to Pure Michigan, the annual Detroit Homecomings and downtown business investments, made and pledged. The growth may well turn the tide for census takers, too, just as happened 100 years ago when the auto industry answered aspirations and fulfilled dreams for Michiganders, for the heartland and the nation. David Friedrichs is a licensed builder, an economics graduate of MSU and founder of Ann Arbor-based Homeland Builders of Michigan (also known as Homeland Solar).

Earlier this year, Amtrak announced its plan to expand offerings through Detroit. | BLOOMBERG

Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited for length or clarity. Send letters to Crain’s Detroit Business, 1155 Gratiot Ave, Detroit, MI 48207, or email crainsdetroit@crain.com. Please include your complete name, city from which you are writing and a phone number for fact-checking purposes.

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

6 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P006_CD_20220328.indd 6

3/25/2022 3:22:55 PM

REDEVELOPMENT

Main Art Theatre in Royal Oak could be razed, replaced with mixed-use building BY KIRK PINHO

The Main Art Theatre in downtown Royal Oak could soon be demolished. City staff confirmed that an affiliate of Bloomfield Township-based A.F. Jonna Development LLC has submitted plans to tear down the theater at 118 N. Main St. north of 11 Mile Road and replace it with a five-story mixed-use building. News of the plans trickled out late Thursday afternoon when the Friends of the Main Art 501(c)(3) nonprofit group working to save the theater circulated a letter that was posted on Twitter by a WDET 101.9 senior editor. City Planner Doug Hedges said Thursday afternoon the developer is expected to appear before the Planning Commission April 12 to present plans for a new 71-foot building, which would include 9,200 square feet of commercial space — half for a restaurant, half for a retailer — plus first-floor parking. In addition, there would be about 31,000 square feet of office space on the second floor and the third through fifth floors would include 54 new residential units. A message was left with Jordan Jonna of A.F. Jonna Development. In a Facebook message, Jason Krzysiak, president of the Friends of the Main Art group, said he has had conversations with the property owner to try to lease the theater. “Those conversations led to the determination that they were not interested in leasing the building to us and would proceed with a redevelopment of the site,” Krzysiak wrote to a Crain’s reporter. The theater, a fixture in downtown Royal Oak for eight decades, closed abruptly last summer, a few months after its operator said it was temporarily shuttering. The property is owned by North Main Square LLC, which is registered to Jonna. Todd Fenton, deputy city manager for Royal Oak, told the Detroit Free Press last year that Landmark The-

CRAIN’S AWARDS

Last chance to register for Crain’s Cool Places to Work Is your business a cool place to work? Maybe you have competitive benefits, a really fun culture or incredible talent retention. Whatever your recipe for employee engagement and satisfaction, we want to hear about it. Applications for Crain’s 100 Cool Places to Work are now open. The deadline is April 1. Winners are selected through an employee engagement survey that also provides participating organizations with valuable employee feedback. For more information or to start the registration process, visit coolplacestoworkmi.com.

“WE AS A COMMUNITY HAVE AN OPPORTUNITY TO PRESERVE THIS IMPORTANT CULTURAL LANDMARK...” — Jason Krzysiak, president, Friends of the Main Art

atres, which operated the threescreen Main Art, terminated the lease with A.F. Jonna. “We as a community have an opportunity to preserve this important

cultural landmark and we can’t let it pass without doing everything we can to ensure that these films light up the screen at the Main Art once again,” Krzysiak said in the letter. Staff in the Royal Oak building department said Thursday afternoon that there have been no applications for a demolition permit nor have any demolition permits been issued for that site. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

The Main Art Theatre has been a fixture in downtown Royal Oak for eight decades. | ARIELLE KASS/CRAIN’S DETROIT BUSINESS

CRAIN’S THOUGHT LEADERSHIP FORUM MACKINAC POLICY CONFERENCE EDITION

HIGHLIGHT YOUR AUTHORITY AND EXPERTISE Share expert commentary in a special Thought Leadership Forum devoted to the 2022 Mackinac Policy Conference theme: the Michigan business community’s changing role in polarizing times. Align with one of four thematic areas:  Advancing diversity as a strength  Utilizing civility and facts in public discourse  Building a culture of empathy  Advocating for the fundamental tenets of American democracy

This special section in Crain’s May 30 Mackinac Policy Conference issue offers high-profile exposure plus bonus distribution on the island.

Contact Associate Publisher Lisa Rudy at lrudy@crain.com to learn more. Hurry – the window closes on May 3!

DETROIT

Other Mackinac issue advertising opportunities are also available, including your full-page ad on the back cover.

 MARCH 28, 2022 | CRAIN’S DETROIT BUSINESS | 7

P007_CD_20220328.indd 7

3/25/2022 11:01:36 AM

INSIDE: A paving company leader, a county road official and a construction union manager weigh in on what’s needed for Michigan’s roads. PAGES 10-11 ONLINE: Find more coverage of major policy issues in other editions of Crain’s Forum. CRAINSDETROIT.COM/

ROADS

CRAINSFORUM

T or fa gan at $2 this St show high ty o acco and Whi plus buil mak cam W wor prop hike billi road “W stru the over the Pan pen hap term and pact and A ditio mer avai Tran Cou good

Mic rep

A worker fixes potholes along Hayes Road in Sterling Heights. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

BARELY TREADING WATER Deterioration of Michigan roads still outpacing fixes | BY CHAD LIVENGOOD

If there’s one issue that bedevils Michigan policymakers the most, it’s those damn roads. For much of this century, lawmakers and three governors from both parties have been debating how to pay for fixing Michigan’s deteriorating transportation infrastructure following decades of stagnant investment and declining buying power of per-gallon taxes on fuel. The Legislature’s 2015 road-funding plan that produced $1.2 billion annually — half from existing tax revenue and half from a seven cents per gallon gas tax increase and 20 percent hike in vehicle registration fee — has produced mostly status quo results. In 2015, 39 percent of pavement in Michigan was rated in poor condition, 43 percent was rated in fair condition and 18 percent of Michigan’s asphalt was considered good. For this year, state transportation

planners have estimated 40 percent of pavement statewide remains in poor condition, 35 percent in fair condition and 25 percent in good shape. “The rate of deterioration is exceeding the rate of the reconstructions,” said Kirk Steudle, who served as director of the Michigan Department of Transportation for 13 years under Democratic Gov. Jennifer Granholm and Republican Gov. Rick Snyder. Where Michigan continues to struggle, Steudle said, is having enough money to perform routine maintenance on fair condition roads to extend the life of that pavement another five to 10 years. “The more (roads) that fall into poor (condition), the only thing left to do is an expensive reconstruction,” said Steudle, who is now a senior vice president at Econolite Group Inc., a California-based traffic management tech company.

Roads expected to get worse The pavement for about one our of every four miles of Michigan is rated in good condition. Pavement conditions are forecast to further deteriorate after 2026 when one-time federal infrastructure funding expires. Good

Fair

Poor

100%

40%

46%

75 35%

34%

25%

2010

2012

2014

2016

2018

2020

2022

20% 2024

2026

2028

2030

2032

NOTE: PAVEMENT CONDITIONS FOR 2022-2032 ARE PROJECTIONS BASED ON EXISTING ROAD CONDITIONS IN 2020 AND RECURRING ROAD-FUNDING BEFORE THE STATE RECEIVED AN ADDITIONAL $1.7 BILLION OVER FIVE YEARS FOM THE FEDERAL INFRASTRUCTURE BILL. SOURCE: MICHIGAN TRANSPORTATION ASSET MANAGEMENT COUNCIL

8 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P008_P011_CDB_20220328.indd 8

3/25/2022 10:25:26 AM

Th wate blin of d out achi into C M pave year pave were Cou It con say M cent cou Th road rate that Roa cou Mou of fi else in p “I this cou have don catc own dus road A lous con cent 2015 state COV data R drop cent

cast

ROADS To get 80 percent of roads in good or fair condition, MDOT pegs Michigan’s annual shortfall in road funding at $2 billion a year through the rest of this decade. State data on pavement condition shows the next few years may be the high water mark for the overall quality of roads in Michigan, even when accounting for new federal funding and the $3.5 billion Gov. Gretchen Whitmer borrowed in early 2020 — plus $1.6 billion in interest — to rebuild several highways and try to make good on a “fix the damn roads” campaign pledge to voters. Whitmer said her plan is starting to work after lawmakers rejected her proposed 45-cent-per-gallon gas tax hike that would have produced $2.5 billion more annually for repairing roads and bridges. “We’ve under-invested in our infrastructure for decades ... and undoing the damage is not going to happen overnight,” Whitmer said March 18 at the Michigan Chronicle’s Politics & Pancakes event. “It’s not going to happen over one term. It’s not going to happen over two terms. This is a longterm issue that we are confronting, and we are starting to make real impact in terms of improving our roads and our bridges.” A complete picture of how road conditions have changed during Whitmer’s first three years in office won’t be available until May when the Michigan Transportation Asset Management Council publishes its annual report on good, fair and poor pavement ratings.

years, you’ve lost that asset value over five years,” he said. “Even MDOT said (the new investment) will slow the deterioration rate, but it’s not going to change the deterioration rate.”

Ways to fix road funding

An orange barrel fills a gaping pothole in a southbound lane of Mound Road in Detroit. | CHAD LIVENGOOD/CRAIN’S DETROIT BUSINESS

Michigan’s local road repair deficit The Great Lakes State is still treading water in its perpetual war on crumbling roads because previous decades of disinvestment have made digging out of the proverbial hole harder to achieve as fair condition roads turn into poor condition roads, experts say. Consider local roads. Michigan’s county road agencies repaved 5,700 miles of roadways last year, more than double the miles repaved in 2015, when about 2,500 miles were improved, according to the County Road Association of Michigan. It was a significant feat until you consider that transportation engineers say Michigan needs to be fixing 15 percent — 13,500 — of its 90,000 miles of county-owned roads each year. The gap last year was 7,800 miles of roads that were left to further deteriorate — as evidenced by the potholes that line long stretches of the Mile Roads in Oakland and Macomb counties, Middlebelt Road in Livonia, Mound Road in Detroit and two out of five miles of county-owned roads elsewhere in Michigan that are rated in poor condition. “If there’s been a casualty to all of this funding … the local roads, the county roads, the city roads, those have been neglected for so long, I don’t know how they’re ever going to catch up,” said Jamie Jacob, CEO and owner of Troy-based Ajax Paving Industries Inc., one of the state’s largest road construction companies. Among Michigan’s 20 most populous counties, the percentage of good condition roads rose from 13.5 percent in 2015 to 17.3 percent between 2015 and 2019, the most recent year state data is available because of a COVID-19 pandemic disruption in data collection in 2020. Roads rated in poor condition dropped from 40.7 percent to 37.2 percent in that time frame, state data show.

Cost to bring a deteriorated road up to par grows faster the more it falls apart | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

A pandemic dip Tax revenue from Michigan’s 27 cents-per-gallon tax on gasoline declined during the pandemic with fewer motorists traveling and commuting to work. Gas

Diesel

2012

$818.8 M

$126.8 M

2013

$821.6 M

$128.9 M

2014

$820.6 M

$137.8 M

2015

$866.6M

$136.7 M

2016

$873.0 M

$137.6 M

2017

$1.14 B

$215.2 M

2018

$1.22 B

$245.8 M

2019

$1.21 B

$243.2 M

2020 2021

$1.09 B $1.11 B

$229.9 M $240.2 M

NOTE: IN 2017, A SEVEN-CENT PER GALLON INCREASE IN THE GAS TAX WENT INTO AFFECT. THE TAX ON DIESEL FUEL ROSE FROM 15 CENTS TO 27 CENTS TO BE EQUAL TO THE TAX ON UNLEASED GASOLINE. SOURCE: MICHIGAN TRANSPORTATION ASSET MANAGEMENT COUNCIL

State funding increases for local roads since 2015 have started to level out — and transportation experts say overall road conditions will begin deteriorating further in the coming years if there’s not a long-term additional increase in funding for roads. The Michigan Transportation Asset Management Council’s analysis of pavement conditions shows about 25 percent of all roads in Michigan are in good condition and will continue to be through 2024. But after 2024, the percentage of pavement in good condition is projected to fall to 20 percent by 2032, according to state data. The most recent data on projected pavement conditions available does

not factor in an additional $378 million Michigan will receive annually for the next five years from the federal government as part of President Joe Biden’s $1 trillion infrastructure bill. That outlay amounts to about onesixth of the $2 billion needed annually to cut the number of poor condition roads in half.

The lost half-decade Critics of the Legislature’s 2015 road-funding law point to a host of reasons why roads today remain just as bad in some cases as they were seven years ago:  The $1.2 billion plan wasn’t fully funded until 2021 because a $600 mil-

lion appropriation of general fund tax revenue was phased in over five years so it wouldn’t put budgetary pressure on other areas of state government. It’s the first time in Michigan’s history that the state’s general purpose checkbook has been used to fund roads, which have been historically funded through user fees like fuel taxes and vehicle registration fees collected by the Secretary of State. Inflation hit the road construction industry years before the pandemic as companies struggled with rising costs for labor, machinery and aggregate. In 2013, the complete reconstruction of one mile of freeway in Michigan cost $1.78 million. By 2018, that same onemile reconstruction cost $3.45 million, a 93 percent increase, according to the nonpartisan Senate Fiscal Agency.  Lawmakers delayed automatic inflationary increases until Jan. 1 of this year, when the tax on gasoline and diesel inched up slightly from 26.3 cents per gallon to 27.2 cents. The diesel tax increase in 2017 was the first since 1984, jumping 11.3 cents to be the same rate as most passenger vehicle owners pay in taxes for unleaded gasoline. The Legislature passed its road-funding plan in the fall of 2015, but the tax increases on fuel and registration fees didn’t kick in until Jan. 1, 2017, delaying the full funding increase from taking effect until the 2019 fiscal year (2018 summer construction season). The Michigan Infrastructure & Transportation Association, the Lansing trade group that represents the road construction industry, argued in 2015 that Michigan needed an immediate $1.2 billion road-funding increase, not one spread out over half a decade. “We wasted five years of investments that could have gone into our roads and would have seen more immediate impact, but the general fund money was phased in and the gas tax inflationary increase didn’t kick in until this year,” said Lance Binoniemi, vice president of government affairs for MITA. Michigan’s roads lose $1 billion in asset value annually, according to MDOT. That has contributed to the price tag for fixing roads continuing to climb each year, Binoniemi said. “When the need is $2 billion and you get $1.2 billion, eventually, over five

Money is always at the heart of road funding. And that discussion always leads back to taxes. Michigan’s current system at the state level relies solely on fuel consumption and the value of vehicles to generate revenue for roads. When gas usage goes down or the overall value of the 7 million registered vehicles in Michigan declines, the amount of money available for fixing roads declines as well. The state’s gas tax revenue declined by 10.5 percent in 2020 compared to the previous year after the pandemic changed driving habits with fewer office-bound commuters and families not going on vacation. Gas tax revenues in 2021 were still about $80 million short of the pre-pandemic three-year average, MDOT data shows. Sen. Ken Horn, a Saginaw County Republican who voted for the last gas tax increase as a House member, said the state needs to diversify its tax revenue sources for road funding. Horn favors a plan that lawmakers crafted in late 2014 to add one penny to Michigan’s 6 percent sales tax that would be dedicated to the roads. Voters resoundingly rejected that plan in a May 2015 special election, causing the Legislature and Snyder to approve a 7-cent gas tax hike and the $1.2 billion plan phased in over the past seven years. “I still think ... the perfect way to raise revenue for infrastructure is through the sales tax,” Horn said. “For me personally, when I talk it through with people at happy hour or in coffee shops, they agree.” Horn said a dedicated 1 percent sales tax could be earmarked for roads and structured to give counties, cities and villages more money to fix local roads. “The money that the governor is spending on our state highway system is one thing, but the roads we actually use — the local roads — those need to be repaired,” Horn said. “Some way, we’ve got to get at them.” MDOT currently has a contract with transportation planning firm HNTB Corp. for a study of how to implement tolling on Michigan’s freeways. The study is supposed to produce data for lawmakers on how much money could be generated through a user fee-based approach to tolling, which could include lower rates for vehicles with more than one passenger. Ajax Paving, which employs 500 workers at the height of the summer road construction season, has operations in Florida. Florida has county-level taxes on fuel and local sales tax levies dedicated to roads that produce a higher per capita revenue source for roads and infrastructure, Jacob said. Jacob and the road construction industry as a whole favor proposals that would allow voters in a county to vote for a local tax on gasoline or a dedicated fee for all vehicles registered in that county that would be dedicated to roads. “Let them vote for addressing their problem,” Jacob said. “To rely on Lansing is not going to work. It’s proven not to work.” Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood MARCH 28, 2022 | CRAIN’S DETROIT BUSINESS | 9

P008_P011_CDB_20220328.indd 9

3/25/2022 10:25:39 AM

ROADS COMMENTARY

Influx of cash offers time for a real funding fix

W ‘n

GETTY IMAGES

future actually looks more hen President Joe problematic than the past. Biden signed the For decades, the state of bipartisan InfraMichigan has played shell structure Investment and games with the funding Jobs Act on Nov. 15 of last needed to fix and maintain year, it guaranteed that alour roads and bridges. Remost $8 billion would be peatedly, Michigan legislainjected into Michigan to tures have used accounting rebuild the roads and bridggimmicks to avoid tackling es that every resident knows Douglas the question of infrastrucare in serious need of repair. Stockwell is ture funding head on. MonAlong with the gover- business nor’s increased invest- manager for the ey that should go to roads goes to schools. Money that ment in infrastructure, it Operating should go to schools goes to would seem that we are in Engineers 324 other things. Meanwhile, a new golden age of road union. necessary projects and work construction, with the have gone unfunded. funding finally available to It is this lack of direct investment turn potholes into pavement and dithat led to our current predicament. lapidation into renovation. Unfortunately, those who see this Roads had to be patched rather than new funding as a “silver bullet” could replaced, and bridges bandaged innot be more mistaken. It’s true, this stead of rebuilt. Each year, our infranew funding will see many of Michi- structure has gotten worse while the gan’s roads and bridges rebuilt. It will cost to bring it up to an acceptable put Michigan’s skilled trades profes- standard has risen. The last couple sionals — like the 14,000+ highly years have brought a welcome reinskilled members of Operating Engi- vestment in our roads from both the state and federal level, but it is not neers 324 — to work. It will be a benefit to our econo- nearly enough. The damage hasn’t only been to mies, our families, and our cars and trucks. But what it won’t do is resolve our shocks and struts either. The vital the issues that got us here, and the work of infrastructure maintenance

and construction requires a skilled workforce — a workforce that can only be developed when there is ample work to do and the funding to do it. When we have failed to maintain our roads and bridges, we have also failed to maintain our skilled workforce, often losing these professionals to other states (where investment in infrastructure is better funded). This includes the next generation workforce. When we dedicate ourselves to sustaining infrastructure with investment, we are giving the opportunity to the next generation workforce to train, acquire skills, and sustain a rewarding career doing necessary work. Today’s concerns

about workforce are a direct reflection of our failure to support this need in the past. We cannot afford to make the same mistakes again. In devising a new model for infrastructure funding, we need to look at new options as well. The massive push in the United States toward electric vehicles provides a glimpse of a future where gas consumption is lower but the need for roads and bridges is undiminished. EVs need quality driving surfaces just the same as traditional vehicles, but without the fuel we currently rely on for road monies. We need to be proactive, creative, and decisive to ensure our roads and bridges are repaired and maintained

at the level we need. We have an opportunity to reverse the course here. The Federal Infrastructure Bill and state bonding have given us enough money to spend the next few years fixing as much of the damage done as possible. It is imperative that we spend this time thinking through and putting a new funding model in place, so that when these current dollars run out the work doesn’t stop. We all know and understand the importance of quality roads — to our communities and to our economy. It’s time we engineer a sustainable funding model that is as solid as the roads we hope to drive.

This problem is only going to get worse, as sales of electric vehicles are projected to soar in coming years and will exacerbate Michigan’s road-funding crisis. That’s why we need the Legislature to keep roads on its priority list. It would be terribly unfortunate if the condition of Michigan’s roads began backsliding after 2025. It would be bad for Michigan’s economy, it would be bad for the quality of life of Michigan’s residents, and it would be bad for the pocketbooks of every motorist in the state (the link between deteriorating roads and increased vehicle maintenance costs has been repeatedly documented). It would also be ironic, at a time when Michigan’s budget is, for the first time in my memory, full to overflowing with cash. One has to ask, if we can’t solve this critical problem

now, when will we? And, further, isn’t providing good roads for the state a basic, but critical function of state government? We need the governor and the state Legislature to come together and finish the job started by the previous governor and the Legislature in 2015 and increase road funding to a level that will allow us to restore the roads and then keep them in good shape. This is not a partisan political issue, and it is an issue that directly impacts every community in the state. Get it done! If needed, there are plenty of us in the industry who are willing to help them figure this out. Frankly, adequate, additional road funding is the only way we’ll ever get to the point where potholes are not the dominant news story at this time every year.

COMMENTARY

put the vast majority of the t may seem hard to benew funds we received into lieve for Michigan moimproving the condition of torists this year, given our paved roads. the abundance of potWhy were the roads in holes, but the reality is such poor shape to begin Michigan’s roads are in with? Because Michigan much better shape in 2022 simply had not adequately than they were five years funded its roads for decades. ago when Michigan’s gas U.S. Census Bureau data retax and vehicle registra- Dennis Kolar is veals that Michigan had tion fees were increased. managing been among the bottom However, the pothole director for the nine states in the nation in challenges we have seen Road per capita state and local this year make it clear that Commission for road funding since at least we have a ways to go yet Oakland 1964 through at least 2017. before Michigan’s road County. We are finally beginning condition problems are in to rise slightly in that ranking the rear-view mirror. Let me give you an example. In thanks to the 2015 road-funding 2017, when the gas tax and vehi- package. However, our projection is cle-registration fee increased (the in- that by 2025, inflation will have eaten creases were approved by the state up the “buying power” of the new Legislature and signed by the gover- revenue from the 2015 package, and nor in 2015), about 9 percent of the the condition of our roads will again Road Commission for Oakland begin to decline. In fact, the County Road AssociaCounty paved roads were in good condition. Today, that number is tion of Michigan (CRA — the organization that represents Michigan’s 83 about 46 percent. Now, 46 percent is still nowhere county road agencies) has concluded near where we would like to be, but it that to adequately maintain Michiis far better than 9 percent. The reagan’s paved county roads, we should son for that improvement is that we be improving 15 percent of those

roads each year, which equates to 13,500 miles of roads. In 2021, Michigan’s county road agencies improved about 5,700 miles of roads — a record for recent years, but far short of the goal of 13,500 miles. All of this underscores the fact that the 2015 road-funding package was not adequate to address Michigan’s road needs. And, that was agreed upon at the time the package was approved by both Gov. Rick Snyder and many members of the Legislature of both parties. They noted the package was a “good start,” but that the Legislature would need to further address road funding if Michigan ever hoped to see significant, sustainable improvements to its road system. A second headwind facing Michigan’s road funding is electric vehicles. While these vehicles may be helping the environment, they certainly are not helping our roads. Since they don’t use gas, they don’t pay gas taxes, even though they cause as much wear and tear on the roads as other vehicles. It’s true they pay a slight increase in vehicle registration fees, but that does not make up for the lost revenue resulting from not paying the gas tax.

GETTY IMAGES

Roads really are better, but future requires work I

10 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P008_P011_CDB_20220328.indd 10

3/25/2022 10:26:02 AM

hea and try s A com repu inno we p in o vice exp W our gan to i we a and wor con as p wha O succ nea Cou Mic with 90,0

ROADS COMMENTARY

GETTY IMAGES

erse nfrahave the the perking ding hese work

Over a two-year period t Angelo Iafrate beginning in 2017, we reConstruction Co., moved and replaced the we’ve been in the eight-lane boulevard withheavy-civil construction out having to shut down the and transportation indusroad, which was critical to try since our inception. ensuring that customers As an employee-owned and 23,000 employees company that has built its could access the 1,200 esreputation on excellence, innovation, and quality, Mike DeFinis is tablishments in that area. Another major project we place significant value vice president of in our employees, the ser- management at that we began in the spring of 2021 is reconstructing 24 vices we provide, and our Angelo Iafrate lane miles of M-3, Gratiot expertise in the industry. Construction Avenue — a major state We take great pride in Co. in Warren. trunkline highway that conour work fixing Michinects downtown Detroit to gan’s roads and, helping to improve vital infrastructure that the suburbs of Macomb County. The project, expected to be comwe all rely on to get to work, school and more. Our crews are hard at pleted later this year, will also inwork making tight state and local clude much-needed upgrades for construction budgets stretch as far troubled and aging sewer and as possible, fixing what we can with drainage systems to better help with stormwater. what we have. Even though our construction One recent project that was a big success was the replacement of crews have been busy working to fix nearly six miles of M-59 in Macomb what we can, there is a lot of work County. That corridor is one of that still needs to be done. Michigan Michigan’s most trafficked roads, residents routinely rate roads as one with a daily volume of more than of their top concerns. The American Society of Civil En90,000 vehicles.

gineers graded Michigan’s overall infrastructure as a D+ and the state’s roads a D- grade. In 2018, it was estimated that Michigan may need an additional $4 billion annually to deal with the necessary infrastructure repairs. What Michigan needs is a longterm, sustainable investment in infrastructure, with funding for roads, bridges, water, and sewer systems, and more. Infrastructure is the foundation of our everyday lives and touches all parts of how we live, work, and play in Michigan. It is the responsibility of Michigan’s leaders to develop a plan that dedicates the needed funds to these critical infrastructure needs. The plan should support innovative policies, increased state funding, and prioritization of public health and safety. In addition, Michigan needs funding for more than just major projects like freeway repairs and upgrades. We also need investments made in all our roadways, such as multi-lane highways, arterial and collector roads, and county and city streets. These are the roads

GETTY IMAGES

Whitmer's bonds, federal aid ‘nowhere near’ what’s needed

WHAT MICHIGAN NEEDS IS A LONG- TERM, SUSTAINABLE INVESTMENT IN INFRASTRUCTURE, WITH FUNDING FOR ROADS, BRIDGES, WATER, AND SEWER SYSTEMS. that make our state work. Drive anywhere in Michigan, and you will find roads in disrepair. Currently, Michigan is experiencing one of the worst pothole seasons we’ve ever had.

While funding from the federal infrastructure plan and state bonding is going to help with some repairs, we are nowhere near the amount of funding needed to adequately fix Michigan’s roads. At Angelo Iafrate Construction, we’re doing what we can with what we have. We’re working with state and local communities to make their budgets stretch as far as possible, while delivering high quality road and infrastructure repairs and upgrades. Michigan’s leaders must do more now, or the vast problems we have with our roads will continue to plague Michigan residents.

the our my. able the

INDUSTRY ACHIEVERS ADVANCING THEIR CAREERS

GETTY IMAGES

Recognize them in Crain’s

sn’t te a tate

the ther prere in to a the ood tical ectly the

For listing opportunities, contact Debora Stein at dstein@crain.com or submit directly to

CRAINSDETROIT.COM/PEOPLEMOVES

are are ut. oad r get not ime MARCH 28, 2022 | CRAIN’S DETROIT BUSINESS | 11

P008_P011_CDB_20220328.indd 11

3/25/2022 10:26:14 AM

NONPROFITS

Scott millions flow to state Habitat for Humanity affiliates “WE HAVEN’T YET DEVELOPED A SPECIFIC STRATEGY (FOR THE GIFT), BUT WE DO KNOW IT WILL BE USED TO EXPAND OUR MISSION IMPACT AND TO CONTINUE TO HELP TO ADDRESS THE HOUSING CRISIS IN OAKLAND COUNTY.”

BY SHERRI WELCH

Two of Michigan’s Habitat for Humanity affiliates are among the latest nonprofits to benefit from billionaire MacKenzie Scott’s philanthropy. Pontiac-based Habitat for Humanity of Oakland County and Flint-based Genesee County Habitat for Humanity have received more than $5 million in total gifts from Scott. The unexpected donations are part of $436 million donated by Scott to Habitat for Humanity International and 84 of its U.S. affiliates. The collective gift marks the largest publicly disclosed donation from Scott since she pledged in 2019 to give away the majority of her wealth, according to an Associated Press report. Genesee County Habitat confirmed receipt of a Scott gift but Executive Director Tom Hutchinson declined to share the amount in advance of formally rolling out that news. “We’re just very happy about the gift,” he said. “It will help us expand our impact in the community.” The Flint affiliate reported $1.4 million in total revenue and an operating loss of $266,200 in 2020, down from just under $1.9 million in 2019 and an operating excess of more than $238,000. It is currently working on a few new home builds in addition to repairs on other homes, Hutchinson said.

— Tim Ruggles, executive director and CEO, Habitat for Humanity of Oakland County

Engineering students from the NYU/Abu Dhabi program learned how to lay subfloor, frame walls, and insulate Michigan’s climate as part of the Genesee Habitat for Humanity in Flint. | FACEBOOK

Habitat of Oakland County is getting $5 million, Executive Director and CEO Tim Ruggles said. “It’s an amazing, unprecedented gift... that will allow transformative work to be done in attainable hous-

ing,” for both low-income and middle-income people served by the affiliate, he said. The Oakland County Habitat is operating on $5.6 million this year, up slightly from last year. Last year, it

served 162 clients through all of its programs: home repairs, home ownership and financial counseling. It has predominantly been focused on renovations of homes in the current, high-priced market for

building materials but had already planned to begin building new homes again this year, Ruggles said. “We haven’t yet developed a specific strategy (for the gift), but we do know it will be used to expand our mission impact and to continue to help to address the housing crisis in Oakland County,” he said. “We’re just very grateful.” Michigan nonprofits that have disclosed their gifts from Scott so far have received at least $92 million since news of her donations first became public in December 2020. Contact: swelch@crain.com; (313) 446-1694; @SherriWelch

FOOD & DRINK

Atwater Brewery’s new president aims to take company to next level 34-year-old CMU grad takes over two years after firm’s sale to Molson Coors division BY JAY DAVIS

Katy McBrady has spent the majority of her 13-year career working with beer in some capacity. Now she’s set to take over one of the top positions inside one of Detroit’s most notable breweries. McBrady will take over as the new president of Atwater Brewery on April 4. The 34-year-old 2009 graduate of Central Michigan University takes over for Mark Rieth, who bought Atwater in 2005. Rieth on Tuesday confirmed to Crain’s that he left the company in December, about two years after he sold Atwater to a Molson Coors division. “I spent 20 great years growing and developing the Atwater brand,” Rieth said in an email sent Wednesday. “I want to see the brand grow and I wish the Atwater team nothing but success in the future. I’m an entrepreneur at heart and am now fully engaged developing my next venture in the city I love. I’m looking forward to announcing details soon.” The new Atwater president, currently finishing out her tenure as vice president of sales and marketing for beverage distributor Classic Beverage of Southern California, is excited about her new opportunity. “This is a very big role,” said McBrady, who started her career in 2010 with Romulus-based West Side Beer Distributing. “I think the experience

Katy McBrady, who is taking over as president of Atwater Brewery on April 4, wants the company to become synonymous with Detroit.

I’ve had in California and on the distributor and supplier side has provided me with enough knowledge to do the job, and I’m going to arm myself with the right folks to get the job done.” McBrady, a graduate of Riverview High School, believes being from the area will also help her in her new position. “Coming from the city, I think I

know enough people who will put me in the right place and connect me with the right people,” she said. “I think the important thing with this role is to step in and take a look at where we’re at in the market. I want to help keep things fresh and cool, but keep the identity what it is. I think where we are now is really sharp and appealing.” McBrady comes in less than a year

after Atwater, established in 1997 as Atwater Block Brewery, launched a $100,000 brand update that included updates in packaging and a new logo. In 2020, Tenth and Blake Beer Co., the U.S. craft division of Molson Coors, bought Atwater Brewery for an undisclosed price. Tenth and Blake Vice President Paul Verdu on Tuesday again declined to share details of the purchase. McBrady beat out more than 50 candidates for the job, according to Verdu. Atwater is a major part of Tenth and Blake’s business, he said, and the company needed a strong leader to come in and help Atwater reach its potential. “(McBrady) has fantastic experience in the beverage business, both inside and outside beer,” Verdu said. “She has been on the supplier and distributor side. She’s marketed to consumers and sold to retailers. So, from an experience point of view, she checked a lot of boxes. But beyond that, it was her intangibles that set her apart. From her leadership style, to her drive, to her passion. On top of everything, she’s a Detroit native who can’t wait to get home. She knows the community. She understands marketplace, and she has what it takes to make Atwater succeed.” McBrady said she hopes to work with the 65 Atwater staffers to help scale the brand locally. Atwater, McBrady said, should be synonymous with Detroit.

Verdu declined to disclose 2021 revenue figures and future projections, but Rieth last spring said Atwater brought in about $10 million in revenue in 2019 Verdu and hoped 2021 figures would match that. Atwater is best known for its traditional German style lagers, along with boutique ales. It expanded into seltzers in 2019. It has taprooms in Detroit’s historic Rivertown district, Grosse Pointe Park and Grand Rapids. “Think about some of the big brands that have scaled up. You don’t say, ‘Can I have a vodka/energy drink’? You say, ‘Can I have a vodka/ Red Bull’,” said McBrady, who worked with Red Bull as a distribution manager for 18 months in 2018-19. “I want people to not just say Dirty Blonde. I want them to order an Atwater Dirty Blonde. “Detroit as a whole has a rich brewing history that kind of fell off. I want to help pick that back up. I think that makes sense. Detroit is going through a cultural renaissance now. I think our brand should be a part of that.” Contact: jason.davis@crain.com (313) 446-1612; @JayDavis_1981

12 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P012_CD_20220328.indd 12

3/25/2022 10:23:26 AM

CRAIN'S LIST | MICHIGAN WOMAN-OWNED BUSINESSES Ranked by 2021 revenue COMPANY ADDRESS PHONE; WEBSITE

MAJORITY OWNER(S)

REVENUE ($000,000) 2021/2020

MICHIGAN EMPLOYEES PERCENT JAN. 2022/ CHANGE 2021

PERCENT WOMANOWNED

TYPE OF BUSINESS

ILITCH COMPANIES 1 2211 Woodward Ave., Detroit 48201 313-471-6600; www.ilitchcompanies.com

Marian Ilitch founder and chairperson

$3,689.0 e

1.8%

NA NA

Food, sports and entertainment industries. Companies include Little Caesars Pizza, Olympia Entertainment, Detroit Red Wings, Blue Line Foodservice Distribution, MotorCity Casino Hotel, Ilitch Holdings Inc., Champion Foods, Olympia Development and Little Caesars Pizza Kit Fundraising Program

DAKKOTA INTEGRATED SYSTEMS LLC

Andra Rush chairman and CEO

$907.0

99.3%

2100 1600

Complete assemblies for original equipment manufacturers

ARISTEO CONSTRUCTION

Michelle Aristeo Barton, president; Anne Aristeo Martinelli, chief strategy officer

$412.4

5.1%

373 363

General contractor, construction manager and self-perform contractor

DETROIT LIONS INC.

Sheila Ford Hamp principal owner and chair

$330.0 2

-19.7%

NA NA

National Football League franchise

BOWMAN AUTO GROUP (BOWMAN CHEVROLET)

Katie Bowman Coleman president and owner

$189.4

16.5%

108 118

100

Automotive dealership

VESCO OIL CORP.

Marjory Winkelman Epstein, chairman; Lillian Epstein Stotland, president and CEO; Lena Epstein, co-owner

$182.0

11.0%

176 176

100

Distributor of automotive and industrial lubricants, petroleum and aftermarket products and chemicals

EHIM INC.

Mindi Fynke president and CEO

$161.4

13.1%

140 134

100

Pharmacy benefits management services, third-party administration and consulting services

MAHAR TOOL SUPPLY CO.

Barb Mahar Lincoln CEO

$91.4

4.5%

53 53

100

Tool management partner and industrial distribution

WOLVERINE TRUCK SALES INC.

Lynn Terry president

$89.1

16.2%

123 162

100

Truck sales, parts and service

MOTOR CITY STAMPING INC.

Judy Kucway CEO and CFO

$82.6 e

28.5%

NA NA

Stamping plant; automotive welding, assembly, dies and prototypes

ARC SUPPLY CHAIN SOLUTIONS INC.

Greta Elliott president

$67.0

4.7%

44 43

Third-party logistics service, freight bill audit and payment, freight optimization

SEKO WORLDWIDE DETROIT

Tanya Bartelo owner

$58.7

71.9%

30 30

Global logistics provider, including air, ocean and domestic transportation, customs brokerage services and export crating, foreign to foreign moves, PO management, project shipping

DFM SOLUTIONS 3

Lauren Rakolta president

$56.0

51.9%

120 305

Facility services, maintenance services and project and engineering services

SYSTRAND MANUFACTURING CORP.

Sharon Cannarsa president and CEO

$53.7

-0.8%

161 187

100

Automotive supplier

DOWDING INDUSTRIES INC.

G. Christine Dowding-Metts CEO

$39.2

31.8%

209 209

100

Precision machining, metal fabrication, progressive die stampings, welded assemblies, custom laser cutting, double disc grinding, rapid response prototyping

CONTRACT DIRECT LLC

Elizabeth Hammond president

$39.1

15.7%

87 69

Facility maintenance services company

AUTOMOTIVE QUALITY & LOGISTICS INC.

Sangeeta Ahluwalia CEO

$36.2

2.1%

184 187

Staffing and service to the automotive manufacturing facilities and their suppliers. OEMs like Ford, GM, Mercedes, VW and tier-one and tier-two suppliers

DK SECURITY

Carri Kendall

$36.2

189 NA

A provider of uniformed security officers, investigations, and background screening services.

PERFORMANCE DRIVEN WORKFORCE

Lizabeth Ardisana CEO

$32.8

50.5%

240 183

Human capital management

WALKER-MILLER ENERGY SERVICES

Carla Walker-Miller founder and CEO

$32.7

10.1%

109 NA

100

Energy waste reduction services

PRODUCTIONS PLUS - THE TALENT SHOP

Margery Krevsky Dosey chair of the board

$30.0

-54.4%

55 NA

100

SAG franchised talent agency and event staffing agency

MCNAUGHTON & GUNN INC.

Julie McFarland president

$28.4

1.8%

155 155

Book manufacturing for short to medium print runs for web, sheetfed and digital printing.

LR MANAGEMENT SERVICES CORP.

Leslie Etterbeek founder, president and CEO

$27.6 4

31.0%

161 134

Real estate management company

BLUE CHIP TALENT

Nicole Pawczuk CEO

$26.3

8.3%

240 178

100

IT, engineering and professional services staffing

UNIVERSITY MOVING & STORAGE CO.

Elise Benedict-Howard chairman

$19.6

-0.0%

75 75

Moving, storage and transportation services

123 Brighton Lake Road Suite 202, Brighton 48116 (517) 694-6500; dakkota.com 12811 Farmington Road, Livonia 48150 734-427-9111; aristeo.com 222 Republic Drive, Allen Park 48101 313-216-4000; detroitlions.com 6750 Dixie Highway, Clarkston 48346 248-795-1841; bowmanchevy.com

16055 W. 12 Mile Road, Southfield 48076 248-557-1600; vescooil.com 26711 Northwestern Highway, Suite 400, Southfield 48033-2154 248-948-9900; ehimrx.com 112 Williams St., Saginaw 48602 989-799-5530; gomahar.com

3550 Wyoming Ave., Dearborn 48120 313-849-0800; wolverinetruckgroup.com 47783 N. Gratiot Ave., Chesterfield Township 48051 586-949-8420; mcstamp.com 13221 Inkster Road, Taylor 48180 877-272-3523; arc-scs.com

6800 S. Cypress, Romulus 48174 734-641-2100; sekologistics.com/detroit 777 Woodward Ave., Suite 500A, Detroit 48226 313-221-1500; www.dfm.solutions

19050 Allen Road, Brownstown Township 48183 734-479-8100; systrand.com 449 Marilin St., Eaton Rapids 48827 517-663-5455; www.dowdingindustries.com 24300 Southfield Road, Suite 321, Southfield 48075 248-361-0427; contractdirect.net 14744 Jib St., Plymouth 48170 734-459-1670; aql-inc.com

5160 Falcon View Ave. SE, Grand Rapids 49512 616-656-0123; www.dksecurity.com 22226 Garrison, Dearborn 48124 313-203-3435; www.pdworkforce.com 8045 2nd Ave., Detroit 48202 313-366-8535; www.wmenergy.com

30600 Telegraph Road, Suite 2156, Bingham Farms 48025 248-342-4794; www.productions-plus.com 960 Woodland Drive, PO Box 10, Saline 48176-0010 734-429-5411; bookprinters.com 2150 Butterfield, Ste 210, Troy 48084 248-548-4800; www.lrmanagement.com

43252 Woodward Ave., Suite 240, Bloomfield Hills 48302 248-858-7701; bctalent.com 23305 Commerce Drive, Farmington Hills 48335 248-615-7000; www.universitymoving.com

$3,624.0 e

$455.0

$392.5

$411.0 2

$162.6

$164.0

$142.7

$87.5

$76.7

$64.3 e

$64.0

$34.2

$36.9

$54.1

$29.7 e

$33.8

$35.5

$21.8

$29.7

$65.7 e

$27.9

$21.0 4

$24.3

$19.6

Researched by Sonya D. Hill: shill@crain.com | This list of woman-owned businesses is an approximate compilation of the largest such businesses headquartered in Michigan. Percentage of the company that is woman owned may not be solely held by the leading shareholder. Number of full-time employees may include full-time equivalents. It is not a complete listing but the most comprehensive available. Crain's estimates are based on industry analyses and benchmarks, news reports and a wide range of other sources. Unless otherwise noted, information was provided by the companies. Strategic Staffing Solutions Inc. which was No. 5 on last year's list declined to participate. NA = not available. NOTES: e. Crain's estimate. 1. Marian Ilitch is the chairperson of the company after the death of husband, Michael Ilitch, on Feb. 10, 2017. Excludes revenue from Detroit Tigers. 2. From Forbes. Net of stadium revenue used for debt payments. 3. Formerly Devon Facility Management LLC. Reorganized and renamed DFM Solutions. 4. LR Management fee of revenue collected.

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

MARCH 28, 2022 | CRAIN’S DETROIT BUSINESS | 13

P013_CD_20220328.indd 13

3/25/2022 10:28:24 AM

PEOPLE ON THE MOVE

Advertising Section

SPORTS BUSINESS

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 ARCHITECTURE

ENERGY

NONPROFIT

HKS, Inc.

Marathon Petroleum Company’s Detroit Refinery

Downtown Detroit Partnership

Marathon Detroit refinery has hired Chris Abshire as its new Environmental Supervisor. Abshire has extensive experience in environmental compliance, both in the petroleum industry and in government. Abshire will be responsible for ensuring Marathon Detroit Refinery’s operations meet all environmental regulations and for finding ways to improve the refinery’s environmental performance. Abshire has a BS in Chemical Engineering from the West Virginia University Institute of Technology.

The Downtown Detroit Partnership (DDP) welcomes John Myers III as Director of Operations Public Spaces. He brings more than 20 years of business and operations management experience and has represented some of metro Detroit’s premiere entertainment venues throughout his career. In this position, Myers will play an integral role in supporting DDP’s operations and help to create memories for visitors from all around metro Detroit and beyond.

HKS is pleased to announce the promotion of John Avdoulos, AIA to Principal and Shareholder at the global architecture firm. A proven leader recognized for his expertise in healthcare design and delivery, John brings decades of experience in design and project management for large-scale healthcare facilities. His work represents more than 3.4 billion dollars in domestic and international projects for renowned healthcare systems such as ProMedica, Beaumont, Ascension and Trinity Health.

Oakland Hills President Rick Palmer said Tuesday at an event at the Detroit Athletic Club that Oakland Hills is “thrilled, excited and honored” to be awarded a pair of U.S. Open Championships by the USGA. | KURT NAGL/CRAIN’S DETROIT BUSINESS

Oakland Hills hires architect for clubhouse rebuild Florida-based firm to head up initial design BY KURT NAGL

ARCHITECTURE

HKS, Inc. HKS, a global architecture firm, is pleased to announce that Tyrone Loper, AIA has been promoted to Vice President at the firm. His unique ability to translate complex architectural design solutions into a built reality is something clients, engineers, contractors and colleagues all admire. Over his 25-year career as a senior project architect, Tyrone has designed $2 billion in construction value for clients within the healthcare, education, aviation and commercial fields.

CONSULTING

Ducker Research & Consulting Rick Lamos has joined Ducker as a Commercial Director in North America. Rick will be supporting growth & development of Ducker’s accounts and expand new relationships within all of Ducker’s industry sectors. With over 20 years of experience in B2B research, insights and consulting, Rick is a proven leader bringing value to client workflows and investment decisions. Rick was most recently a Client Services Leader for MarketsandMarkets, and previously with Navigant Consulting, and Frost & Sullivan.

NONPROFIT

The War Memorial

MANUFACTURING

BACA Systems BACA Systems is pleased to announce that Whitney Moon and Tim Burke have joined the company as chief technology officer Moon and chief revenue officer, respectively. Prior to joining BACA Systems, Moon held various leadership positions in engineering, operations, and industrial automation sales with Adaptec Solutions, a leading provider of robotic automation and material handling systems. Previously, he served in several engineering and market Burke development roles with Genesis Systems, a robotic systems integration company. Before joining BACA Systems, Burke built lasting customer relationships while increasing revenue at several start-ups and enterprise software technology companies, including Dassault Systèmes, IQMS, Xeeva, QAD, and Plex Systems.

The War Memorial welcomes Maria Miller as its chief financial officer. Miller has been a financial leader in the non-profit sector for 20 years, having helped various leaders develop financial acumen by partnering and understanding their operational needs. Miller will be responsible for ensuring The War Memorial’s financial operations meet targeted goals and develop new and innovative strategies. Miller holds an MBA from Wayne State University.

RETAIL

New Standard Cannabis Michigan cannabis retailer New Standard welcomes Marketing Director Skylar Van Dyke. Van Dyke previously worked for Dietz and Watson where he managed various pieces of the business including merchandising, sales, and retail marketing. He also partnered with retailers like Kroger, Albertson’s, Giant Eagle, and Meijer. Van Dyke has a passion for cannabis, formerly working with Cloud Cannabis to help grow the California brand Kaneh Co. into the No. 2 cannabis infused baked good in Michigan.

Oakland Hills Country Club has hired a Florida-based architect for the initial phase of design for the rebuild of its historic clubhouse, which was destroyed in a Feb. 17 fire. Florida-based Peacock + Lewis Architects and Planners LLC, which recently merged with JBD JGA Design & Architecture, will head up the initial design, club President Rick Palmer said. Demolition of what remains of the 100-year-old structure, deemed a total loss by firefighters, is also underway, and members were allowed on the site Friday for the first time since the fire. “Our driving range is open. Our paddle tennis is open,” Palmer said Tuesday. “So, people are out there hitting balls. Tonight will be the first time we’ve gotten together as a group to say, ‘OK, here we are, how do we go forward?’” Palmer offered the updates Tuesday after the United States Golf Association’s eagerly anticipated announcement that Oakland Hills has been awarded U.S. Open Championships in 2034 and 2051. Officials from the club and golf governing body made the announcement at the Detroit Athletic Club, where the idea of Oakland Hills Country Club was first conceived more than a century ago. Oakland Hills aims to break ground on a new clubhouse in a year, Palmer said. The earliest a new clubhouse would be erected is 2024, and members are preparing to have three seasons without one. The general idea is to re-create what was lost in the fire, but a design must be approved by its roughly 750-member base made up of community leaders and business executives. “It’s an aggressive six-month process to do focus groups, to do study groups and come up with a design that will be submitted to members for member approval,” Palmer said. Focus groups, totaling about 200 members, will be assembled over the next two weeks to steer the rebuild strategy. “It’s ironic,” Palmer said. “One of our great members, Chris Ilitch, hosted our leadership team last

week, and he talked about embracing your history with our iconic clubhouse like they did with the Fox Theatre, and he also talked about preparing for the future, and how do we future proof our clubhouse just like we future proofed our golf course with the investment and infrastructure in the ground.” The cost of the rebuild has not been finalized and will have to be approved by members, according to the club. Last month’s fire, believed to be started accidentally by contractors working on a patio adjacent to the clubhouse, caused $80 million in damages, Oakland County Sheriff Michael Bouchard said. That estimate was given by insurance investigators, Crain’s confirmed with the department Tuesday. Palmer declined to speak to how the insurance payout would work or whether members might face higher assessments to fund the rebuild. “It’s an ongoing investigation,” he said. “The various insurance coverages and carriers are still in that negotiation.” Peacock + Lewis, founded in 1961, has designed high-profile hospitality and club amenities around the world including Riviera Country Club in Coral Gables, Fla., Muirfield Village Golf Club and Clubhouse in Dublin, Ohio, and Bay Harbor Yacht Club in Petoskey. In January, Peacock + Lewis merged with JBD JGA, another Florida-based firm with extensive experience in private clubs and hospitality. “We’re thrilled with them so far,” Palmer said. Oakland Hills intends to continue member business as usual by adding a large, enclosed pavilion to accommodate dining and seating, Palmer said, adding that details on the plan will be shared in the coming weeks. Weddings and private events are being moved to alternative venues, he added. “The interim plan is all of our member events, all of our invitationals, all of our galas, that will all occur,” Palmer said. “We anticipate a full season.” Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl

14 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P014_CD_20220328.indd 14

3/25/2022 9:55:24 AM

SOLAR

From Page 3

Norcia, who is adding the chairman title at DTE next month following the retirement of Executive Chairman Gerry Anderson, said the Detroit-based utility company will detail its solar development plan after 2024 in a new integrated resource plan to be filed by October with the Michigan Public Service Commission. Jackson-based Consumers Energy is awaiting approval by the commission for its latest integrated resource plan in June, which calls adding 8,000 megawatts of solar by 2040, company spokeswoman Katie Carey said. “Pending that gets approved, we’re going to be really out there looking for land, promoting the benefits of solar to people interested in having solar arrays in their community,” Carey said. “If you’re a farmer that wants to get out of the farm business, we’re looking at (farmland).”

‘They can coexist’ Solar power generation requires 5 to 7 acres for every megawatt of electricity. “We’re trying to target land that isn’t as productive agriculturally,” Norcia told Crain’s. “But eventually you run out of those types of options and you start to take agricultural land out of service. And that’s a policy issue that I think we need to think about as a state.” Environmental groups that support a rapid expansion of renewable energy use are less worried about land use. Nick Dodge, communications director for the Michigan League of Conservation Voters, noted there are 10 million acres of agricultural land spread across Michigan’s two peninsulas.

FRENZY

From Page 3

“If it’s attractive, they will frenzy,” said Al Block, an appraiser and broker/ co-owner of RE/MAX First in Southeast Michigan. “If it’s high, they will not frenzy.” Block said more than half of listings he’s seen have multiple offers, but geography matters. There’s also less activity when homes are priced high relative to the rest of the market, he said — though those houses are still getting activity in a lower range. With the market so robust as it is, Block said the buyers who are likely to succeed are those making guarantees. He recently sold a rental property in Warren and said he took a guaranteed all-cash offer rather than a higher offer from a buyer who needed a Federal Housing Administration loan. Those calculations are among the things that have made the market difficult for such buyers, he said. “In the end, the seller cares about only one thing and that’s that the seller gets a check,” he said. “It appraised low and he’s still buying it. ... I took the sure thing.” With low appraisals happening as the demand for homes — and their prices — continues to rise, Austin Black II, broker/owner of City Living Detroit, said he’s telling clients that they should be prepared to have anywhere from $5,000 to $20,000 on hand to make up the difference if an appraisal doesn’t come through. Even with interest rates rising, the supply of homes

DeMille Solar Farm in Lapeer. | DTE ENERGY

“If we’re talking about tens of thousands of acres for solar development, it’s really a drop in the bucket,” he said. “We have plenty of land — they can coexist for sure.” Brad Neumann, senior extension educator at the Michigan State University Extension, said the coming tide of solar development will put pressures on townships, villages and cities to craft zoning regulations for where panels can be placed. He points to MSU’s development in 2018 of 5,000 parking lot carports with solar panels on top as one creative way to site solar in an urban or suburban setting without taking farmland out of production. There also may be ways to maintain agricultural use of land with solar panels, much in the way wind turbines dot farm fields along U.S. 127 in Gratiot County, Neumann said. “You could still incorporate live-

stock into these things where that animal is doing a job for a solar developer and could be eventually sent to market,” Neumann said. One of the keys to making the economics of solar work is getting arrays close to existing high-voltage power lines and in places where there’s capacity on the electric grid for more power. The challenge, Norcia said, is finding suitable sites in or near urban and suburban areas that aren’t obstructed by trees, other structures and have southern exposure to capture sunlight and convert it to electricity. DTE is exploring vacant land sites in Detroit to build new solar parks after constructing a two megawatt solar array at O’Shea Park on city’s west side. In 2019, DTE erected 7,400 solar panels on half of the abandoned 20acre park near I-96, generating power for about 450 homes.

“IT’S SIMILAR TO WHAT IT WAS LIKE IN EARLY 2021. THE GROUP I FEEL SORRY FOR RIGHT NOW IS FIRSTTIME HOMEBUYERS.”

you just priced the house at an astronomical number, you’re going to get multiple offers. If a house is worth $170,000 and you put it at $165,000, you’re going to get $185,000. This market is more of a frenzy to me than the market we had pre-crash.” Both Trowell and Tooley, with Redfin, described the housing market as “rough.” And Trowell said she doesn’t see any sign of it changing.” “It’s crazy,” she said. “That’s all I know to say.” Tooley said buyers who are coming to metro Detroit from different markets are less surprised than locals are by the extent of the activity. But the average person still thinks it might be possible to offer $10,000 under list price and get a deal. Instead of calling agents to see if they might entertain such lowball offers, as they did in the past, Tooley said most of her calls are now to gauge how high over asking price her clients might need to bid to have a shot. “Now, it’s a different conversation,” she said. “Buyers are trying to find creative ways to win homes.” One, upon learning that a seller wanted free occupancy, jokingly asked if they wanted the buyer to come over to the house nightly to make them dinner, too. They considered adding Uber Eats gift certificates to the offer as well, but decided against it. “I basically had to sell my soul and promise to name my firstborn after them, but I got it,” Tooley joked.

— Austin Black II, broker/ owner, City Living Detroit

in the metro area remains low and demand will stay high, he said. “We’re really dealing with a scarcity of available homes,” Black said. “As long as inventory is low, we’re going to have a lot of buyers competing for a small number of properties.” Black confirmed that most homes are getting multiple offers and selling above list price. He said, too, that conversations with agents can help make the difference in getting an offer accepted. That way, offers can include things like 30 or 60 days of free occupancy for sellers, which may be worth more to them than money — especially as sellers turn into buyers and are thrust into the same tumult. “It’s similar to what it was like in early 2021,” he said. “The group I feel sorry for right now is first-time homebuyers.” Carol Trowell, a real estate broker with DuPont & Associates, said she’s made four offers on behalf of clients in the past week, and each home had multiple offers on it. She only got one, and that was a cash-only purchase in a co-op downtown. “If the condo took financing, we probably would have been SOL,” she said. “Inventory is so low that unless

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

“We’ve got a few more like that that we want to do,” Norcia said. “But the city obviously always weighs their uses for land, too — they want to see redevelopment, either housing, or commercial or industrial.”

Using fallow land The increasing use of solar has caused the Michigan Department of Natural Resources to start assessing under-utilized state-owned land for solar arrays. The state agency has thousands of acres of fallow land within its 4.6 million-acre portfolio that’s not being used for parks, recreation or hunting, said Scott Whitcomb, director of the Office of Public Lands at DNR. Some of that land includes former mines and brownfield sites once used for industrial purposes that DNR obtained after the previous

owners stopped paying taxes and abandoned the land. In 2020, DNR inked a deal with Troy-based solar developer Circle Power Renewables for a land option to build solar arrays on a former mine tailing site in the Upper Peninsula’s Dickinson County and a former gravel pit south of Grayling in Crawford County. A mine tailing site is land where rock and byproduct waste from mining for iron ore has been deposited. “The nice thing about these industrial sites is because they were intensely used … there’s a substation right there where you can put the power back on the grid,” Whitcomb said. Circle Power Renewables is still studying the two Up North sites to see if it’s feasible to get connections to the electric grid before it enters into a long-term lease agreement with the state, said Jordan Roberts, CEO and founder of the company. Roberts, an Oakland County resident, said he and his partners have years of experience building solar and wind parks in other states. Circle Power, whose capital investors include El Paso, Texas-based Hunt Cos., is currently developing a 12-turbine, 60-megawatt wind farm near Houghton in the western U.P. for Marquette-based Upper Peninsula Power Company. The solar projects in Dickinson and Crawford counties have engineering obstacles to overcome, but Circle Power is interested in finding a way to put land that would otherwise sit fallow back to productive use, Roberts said. “Building on former mine tailings, mine ponds or on a gravel pit is more challenging” than building on farm land, Roberts said. “The long pole in the tent is connecting to the grid.” Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood

Advertising Section

CLASSIFIEDS To place your listing, contact Suzanne Janik at 313-446-0455

MARKET PLACE REQUEST FOR PROPOSALS The Detroit-Wayne Joint Building Authority manages the two-tower 745,000 square foot Coleman A. Young Municipal Center located at 2 Woodward Avenue, Detroit, Michigan and is issuing Requests-For-Qualifications for the following Professional Services. • Audit: Auditing firm to provide audit services for the fiscal year ending June 30, 2022. • Insurance: Insurance Agency responsibility for placing insurance coverages. The deadline for submitting qualifications is noon, Monday, April 11, 2022. If you are interested in receiving an RFQ please send your request to commissioners@dwjba.com

JOB FRONT POSITION AVAILABLE Kautex Inc. has an opening in Detroit, MI for a Manager Focus Factory to create a continuous improvement culture to ensure safety, quality, & productivity & cascade targets, strategy goals, & objectives to direct reports. Bachelor’s Eng. & 3 years of experience required. Must have legal auth. to work permanently in the US. EOE. http://www.textron.com/careers (Requisition ID 300430).

SUBMIT YOUR AD TODAY MARCH 28, 2022 | CRAIN’S DETROIT BUSINESS | 15

P015_CD_20220328.indd 15

3/25/2022 3:38:11 PM

BLIGHT

From Page 1

Time is one of the concepts the Heidelberg Project explores. | LAURÉN ABDEL-RAZZAQ/CRAIN’S DETROIT BUSINESS

HEIDELBERG

From Page 1

The Heidelberg Project’s board expects to name an interim president before Whitfield departs to oversee the nonprofit while it conducts a local and national search, said Roula David, a director on the Heidelberg Project’s board and head of the search committee for a new president and CEO. Whitfield said she wasn’t looking to leave. The Maryland museum approached her after someone nominated her. “It would have to take a lot to draw me away from Heidelberg. ... It’s been hard as hell, but I’ve loved it,” she said. Guyton started the Heidelberg Project in 1986 on Detroit’s east side, cleaning up blighted lots on Heidelberg Street and using scraps and trash to build the installation over the years. The nonprofit and its artwork have faced many challenges over the years, including arson, theft, city demolition, controversy and criticism. With its focus on showcasing intuitive, selftaught artistry and exploring what it means to be human, AVAM is, in many ways, “Heidelberg with walls,” Whitfield said. Joining the Baltimore museum is the next step, Whitfield not far removed from the work she has been doing in Detroit, she said. “It’s time for the next generation to pick up and continue to grow the Heidelberg Project because it is now recognized as a part of Detroit’s cultural fabric,” she said. Whitfield and Guyton are definitely anchors for the Heidelberg Project and Heidelberg Art Leadership Academy, but as the community shifts to create an arts district on the street, a pass of the baton was expected, David said. Heidelberg’s board and staff of six people will also continue to champion the nonprofit and arts district, she said. “We are all incredibly passionate about the work being done

there,” she said. Guyton and Whitfield have set up the staff and board — which includes longtime members and there since the beginning — for success, she said. And while Guyton will shift between Detroit and New York where his art is on display in a gallery, he still has family on Heidelberg Street and watches over the look and feel of the installations there as creative director. “Whether he’s creating art for the installation or himself, you will see Tyree on Heidelberg Street,” said David, owner of Spot Lite, a nearby arts venue that offers coffee during the day and cocktails and music at night. “I think people will see the fabric of the Heidelberg Project has not changed.”

Hitting the streets The Heidelberg Project began dismantling the two-block arts installation on its namesake street between Gratiot Avenue and Mt. Elliott in 2016. So far, about half of the works have been taken down, some removed after years of exposure to the elements and others moved into storage, Whitfield said. Some have gotten a new life on the road. Parts of the installation were shown during 2018 SiTE:LAB in Grand Rapids; others opened within the last month as part of a streetfront exhibit at Martos After Dark in New York City. Yet other parts are set to go on display at Kohler Museum in Cheboygan, Wis., next year, Whitfield said. Given AVAM’s shared focus on social justice and the pressing concerns of the day, the idea of collaboration with Heidelberg Project in the future “is certainly an exciting prospect that will be explored,” said Gregory Tucker, a spokesman for AVAM. For most of its existence, the Heidelberg Project has been synonymous with Guyton and his art. But he’s long aspired for the project to be more than that, David said.

The nonprofit launched an inschool and afterschool arts education program in 2017, teaching middle school and high school students about careers in the arts and providing internships. In 2018, it acquired its headquarters building on the street — along with several other lots — giving it ownership of about 60 percent of the properties, Whitfield said. The Heidelberg Project is operating on a $1.4 million budget, with about 60 percent of its revenue coming from grants and the remainder from individual donors and the proceeds of its online gift shop and commercial site shoots for companies including Pepsi Co. It’s in the process of kicking off a curator-in-residence program to work with applicants who want to curate a show in a gallery space. While continuing to dismantle the original core works of the Heidelberg Project as part of a multiyear effort, the nonprofit is inviting in other artists who have been influenced by the Heidelberg Project to add to its footprint. Nawillie Griffin, a California artist in residence at Heidelberg, came to Detroit last summer to bring new life to trees damaged by the 2013-14 fires on the grounds by wrapping the trunks with brightly colored yarns. Local artist Roy Raines built benches and tables from charred wood found on the grounds to give the larger numbers of people coming during the COVID-19 pandemic a place to take it in. And last week, Brooklyn, N.Y., artist Tom Furin built a multicolored glass cathedral the size of a playhouse to speak to the way Heidelberg is like a ministry for other artists, Whitfield said. The idea is for Heidelberg to be transformed not just by Guyton’s art, but other’s people’s art, as well, from visual art to dance and music, David said. Heidelberg “will always have art,” she said. “It’s never going to be a blank street.” Contact: swelch@crain.com; (313) 446-1694; @SherriWelch

About 73 percent of the buildings on the list are in the tear-down pipeline. For some others, reuse is underway or being considered. The buildings that populate the list are as varied as their locations, including empty churches, crumbling strip malls, a former adult entertainment venue, nearly a dozen publicly owned schools, huge industrial buildings and historic brick facades. There are 117 properties total, though in several cases that includes multiple lots making up a single building. “The mayor put this team together to basically say, OK, where are the top 100 eyesores that are very prominent in terms of, when you think of Detroit blight, you think of those properties,” said Brian Farkas, a senior adviser to Duggan. Some were obvious first choices, Farkas said, like Lee Plaza, which Detroit-based Roxbury Group and Ethos Development Partners plan to redevelop, and the massive Fisher Body No. 21 plant for which a $134 million renovation plan was announced this month. Farther down the list, Farkas’ team worked with the city’s Department of Neighborhoods to go area by area, determining the largest derelict structures. Criteria included whether a property is more than one floor; is surrounded by residents; is in a Strategic Neighborhood Fund zone; has been the subject of complaints from nearby residents; isn’t being properly maintained; and is along a major road, he said. Much of the list is made up of city owned property. “(The Department of Neighborhoods is) the closest to the residents and the neighborhoods, as far as the administration goes,” Farkas said. “And so they were like, ‘Oh, you want to know the top blighted areas? I’ll show you the top blighted areas.’ And that’s where a lot of the list came from.” While properties owned by absentee landlords like Dennis Kefallinos are on the list, Farkas said the city is not looking to target certain owners. Ownership, Farkas said, was irrelevant. The idea was to first choose the top 100 or so properties, then decide how to move forward with the city’s planning, legal, building safety or demolition departments, depending on the circumstances. Then, based on the list, the city could decide to take legal action against an owner; try to force compliance with city code through ticketing and other measures; move forward with demolition itself; or sit back and keep tabs because a developer was planning redevelopment there. Duggan’s neighborhood improvement strategy has been criticized over the years for focusing too much on demolition and not enough on preservation. His strategy has also been seen by some as a pricey endeavor that comes at the cost of less focus on residents’ more immediate needs. Some say the money could be better spent directly helping impoverished Detroiters. There’s also the argument that commercial blight removal efforts steer property to big companies without enough resident input. Still, Farkas said the commercial demolition effort is about residents. “For years you’ve had these huge

examples of blight in the city of Detroit and throughout the mayor’s administration, you’ve seen them systematically being addressed,” Farkas said, citing Ford Motor Co.’s redevelopment of Michigan Central Station in Corktown as well as projects downtown by billionaire Dan Gilbert’s Bedrock LLC. “This is an effort to say, ‘What are the ones remaining? Let’s go after them.’ ... The overall point of this is to effect physical change for the residents of the area.” Farkas said there’s no overarching timeline for dealing with what the mayor sees as the city’s top commercial blighted properties. It’s all case by case. “But there’s a level of urgency, I want to communicate, that is very high on this,” he said. “The goal is to get rid of the blight, the goal is not demolition.” Asked how the city would decide a building should be demolished and not renovated, Farkas said officials walked construction experts through some properties, looked at whether projects would be more costly than the market can bear, and whether the city would want to commit to providing financing for a project or not. Farkas declined to comment on how demolition that results from the list would be funded. Options would include the city’s general fund or dollars from the American Rescue Plan Act, which provided the city with a total of $826.7 million in COVID-19 pandemic aid. Detroit is planning to use $95 million to address commercial blight. Some of the buildings stand out because of their previous use or how they came to languish, while others are on the list because of their ownership’s track record of property stewardship or lack thereof. Some are in areas with ample commercial development activity, such as Midtown or the Detroit riverfront. Here are some of their stories, in brief form:

Shuttered schools targeted Nearly a dozen former public school buildings are lined up for demolition, including many that were part of a study last year that found that the cost to redevelop 63 of the buildings would be right around the total amount the city received in federal COVID-19 relief money. Of the 11 school buildings on the city’s demo list, nine were included in the study commissioned by the city and the Detroit Public Schools Community District. Their projected cost to redevelop was $125 million for their more than 525,000 square feet. Those sites are the former Monnier, Collidge, McKerrow, Jemison, Sampson, Jamieson, Wilkins, Carstens and Hubert schools. Not included in the study last year but targeted for demo now are the former Kettering property at 6101 Van Dyke and the former M. M. Rose School at 5505 Van Dyke on the east side.

Kefallinos-owned buildings At least eight properties owned by controversial Detroit real estate investor and landlord Dennis Kefallinos are also slated for demolition. They include the former Southwest Detroit Hospital, which the city had previously ordered demolished (and which Kefallinos subsequently tried to sell for $17.5 million); the for-

16 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P016_P017_CD_20220328.indd 16

3/25/2022 3:43:19 PM

mer Roa at 1 bou neig East that last Hum O Bras 5435 Sup St. a K and effo whi ly so H Wab dete perm repa War B prop han “Y sure we a if th con year ings

Eas

A othe Dug Th men Ave. well foot Ave. the K up opm said velo she oliti issu on n S son wee gan Aut “P buil for d biliz whi sary of t year ema Sh opm the “I for m ing plish blig and from som into the M volv deca

For hea

Th dete fice 1937 Cho ferre

Deadsysrkas veltion ects Gilffort ing? erall sical ea.” hing the mercase

cy, I very is to not

de a and cials ugh ther han the vid-

on the ould dolPlan th a D-19 g to mer-

out how hers nerewe in veln or

s, in

blic for that that p 63 ight y reelief

the ded the ools cted lion uare

nnison, kins, t intarmer Dyke ol at

ned tate Keoli-

uthcity hed ntly for-

mer Civic movie theater on Kelly Road; a former cold storage building at 1448 Wabash St. that Kefallinos bought in 2018 in the Corktown neighborhood; a large building on East Warren Avenue with a facade that was crumbling into the roadway last summer; and a building at 4423 Humboldt St. Others include the former Roberts Brass Manufacturing Co. building at 5435 W. Fort St., the former Coverall Supply Co. building at 2646 Erskine St. and a building at 3100 Hubbard St. Kefallinos said he was out of town and hadn’t been notified of the city’s efforts to tear down his properties, which he contended were structurally sound and should be spared. He has started some work at the Wabash building although he hasn’t determined an ultimate use, building permits reflect. And some corrective repairs have been made to the East Warren property. But, Kefallinos said, whether his properties are on the list is out of his hands. “You can’t fight the mayor, that’s for sure,” he said. “I feel all the buildings we are talking about can be saved, but if they want to tear it down, I cannot control it. I have been here the last 40 years developing and cleaning buildings, but what can I say?”

Standout properties on Duggan’s demo list Detroit’s list of top 100 blighted commercial buildings targeted for demolition or redevelopment includes some notable properties and owners. 1 2550 Coplin St. Nearly a dozen vacant school buildings totaling more than 525,000 square feet, including the former Hattie M. Carstens Elementary School at 2550 Coplin, are slated for demolition or other use.

2 HIGHLAND PARK

94 75

HAMTRAMCK

1 3

BELLE ISLE PARK

9 12

DETROIT WINDSOR

SOURCE: CITY OF DETROIT AND CRAIN’S DETROIT RESEARCH

CRAIN’S DETROIT BUSINESS GRAPHIC

4 8100 Schoolcraft The building that once was the headquarters of the La Choy brand of American Chinese foods is slated for demolition.

6 12802 Kercheval Ave. Real estate developer Philip Kafka owned this blighted property near the new FCA/Stellantis plant, up until October. He sold it for nearly $817,000. 7 6138 Michigan Ave. This small building in the Chadsey Condon neighborhood is owned by an entity registered to Joe Gappy, who also owns nearby Prince Valley market. It reportedly dates to the late 1890s and was a firehouse and Spanish restaurant.

The property at 11031 Shoemaker. | KIRK PINHO/CRAIN’S DETROIT BUSINESS PHOTOS

8 12801 Mack Ave. A September 2019 fire at the Reverend Ann Johnson Elderly Apartments near Mack and Connor destroyed the building. It was recently demolished. 9 3430 Third Ave. The nonprofit Neighborhood Service Organization once had a deal with a housing developer and the Ilitch family’s Olympia Development of Michigan to buy the Tumaini Center for people without housing.

the 1940s. It later housed Gilbreath Manufacturing, U.S. Fastener Corp. and Daughtery Inc., per Detroit newspaper archives. The city owns the site at 8100 Schoolcraft St. on the northwest side that over the years has been partially demolished, gone through bankruptcy court and hit by fires. This property off Kercheval on Detroit’s east side was sold last year for nearly $817,000.

Former Federal-Mogul site Another property Duggan’s staff targeted for a tear-down is an old Federal Mogul Corp. industrial site at 11031 Shoemaker St. near Chandler Park, also city-owned. It was used as an industrial facility from 1925 until the 1970s, according to a state of Michigan environmental report, by Federal-Mogul as well as Bower Bearing Manufacturers and others. It was operated in the 1980s by Erwin Trucking and RPM Distributing and later used by Detroit’s Department of Water and Sewerage, the report says.

Former La Choy headquarters The city also aims to demolish a deteriorated 145,000-square-foot office and warehouse complex built in 1937 that was first home to the La Choy Co. food brand, then transferred to Micromatic Hone Corp. in

3 13101 E. Jefferson Ave. A handful of buildings owned by multifamily landlord Kathy Makino-Leipsitz, including 13101 E. Jefferson, are on track for demolition.

5 11031 Shoemaker St. For 25 years ending in the early 1970s, Federal-Mogul owned this property a few blocks east of Chandler Park.

East Jefferson buildings A trio of buildings owned by another prominent landlord are on Duggan’s list, as well. The former River Plaza Apartments buildings, at 8430 E. Jefferson Ave. and 8434 E. Jefferson Ave., as well as a nine-story, 131,000-squarefoot building at 13101 E. Jefferson Ave. are slated to be torn down under the current plan. Kathy Makino-Leipsitz, who heads up Detroit-based Shelborne Development and owns the properties, said she has been working on redevelopment plans for them. Although she was aware they were on old demolition lists, she was unaware of new issues that would cause them to be on new demo lists. She said for the 13101 E. Jefferson building, she is going in next week for funding from the Michigan State Housing Development Authority. “Purchasing vacant blighted buildings that have often sat vacant for decades and securing them, stabilizing them, and holding them while you secure the dollars necessary to complete gut rehabilitations of them is not easy, it often takes years,” Makino-Leipsitz said in an email. She also said she has seen redevelopment become more challenging the last several years. “I see a lot of things going on, but for me personally, rather than working together to get things accomplished, they just bombard me with blight violations, fines, and lawsuits and all that money that they take from someone that is trying to do something positive could be going into the building/project rather than the city coffers,” she wrote. Makino-Leipsitz has been involved in Detroit redevelopment for decades.

2 12323 Kelly Road Several properties owned by Dennis Kefallinos are demolition targets, including the former Civic theater property on Kelly.

Old engine factory that Kafka sold

The former Civic theater property on Kelly Road.

An old engine factory that Core City developer Philip Kafka recently sold for $817,000 to a Florida investor is also on the list.

Per the M100 list, the city is pursuing legal action on the 60,000-squarefoot complex on 6 acres at Algonquin Street and Kercheval Avenue on the east side. Kafka bought it in October 2019 for $208,000. Kafka said he originally planned to turn the site’s existing structures into monuments and develop around them, but ended up selling the site to focus on development work in the Core City neighborhood on Detroit’s west side instead. He said it would be a “shame” if the entire site was demolished, but acknowledged the structures aren’t fit to be buildings again. The plant was originally designed by famed architect Albert Kahn, according to building tracking site Historic Detroit. Continental Motor Co. started operations there in 1912 and later the site was part of the “Arsenal of Democracy” making parts needed during World War II, per Historic Detroit. In subsequent years the site changed hands a couple of times, got remodeled and later pieces of the facility were demolished or lifted by scrappers.

The weird histories There are a couple interesting historic properties on the list that are in the demolition pipeline, ranging from the previously mentioned, Kefallinos-owned former Roberts Brass Manufacturing Co. building built in 1906 to a distinctively bright-red firehouse along Michigan Avenue. The fire department building at 6138 Michigan Ave., nearly 130 years old, closed as a fire station in the 1980s and was later a Spanish restaurant called Casa de Espana, according to Detroit Free Press archives. Its current owner, per city and state records, is Joe Gappy of nearby grocery store Prince Valley Market. Another old, multistory brick building, owned by the city at 3005 Elmwood St., was a longtime German social club and the headquarters of the City Singers Association, per Free Press archives. The exact date of this building’s construction is unknown but likely dates to the 1920s.

Burned senior housing In September 2019, a fire ripped through a senior housing building on Mack Avenue near Connor, news reports at the time said. That building, formerly the Reverend Ann Johnson Elderly Apartments at 12801 Mack Ave., stood fire-damaged for more than two years after, a scar on the neighborhood. But earlier this week, the site appeared to be freshly cleared, with construction equipment visible from outside a chainlink fence.

A former homeless center The Tumaini Center in the city’s Midtown neighborhood for those currently without homes is also eyed for the wrecking ball. The nonprofit Neighborhood Service Organization once had a deal with a housing developer and the Ilitch family’s Olympia Development of Michigan to buy it, although that appears to have fallen through. A message was left with the NSO seeking comment Wednesday. It sits near new planned housing by Peter Cummings’ Detroit-based The Platform LLC and Stephen Ross’ New York City-based Related Cos. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB MARCH 28, 2022 | CRAIN’S DETROIT BUSINESS | 17

P016_P017_CD_20220328.indd 17

3/25/2022 3:43:32 PM

THE CONVERSATION

Doner CEO wants employees to see the office as a ‘destination’ David DeMuth, CEO of Doner Partners LLC, the Southfield-based ad agency that’s been around for 85 years, started out at Doner as an assistant account executive 33 years ago. Doner, one of few longtime metro Detroit advertising companies that’s not reliant on the automotive industry, has a client list that includes Johnson & Johnson, Tylenol and L.L.Bean. DeMuth spoke with Crain’s about his competitive streak, returning to the office, art and Bruce Springsteen. | BY ANNALISE FRANK  Can you give us some of your history in the field? Your interest in advertising started when you were a teenager, right? I didn’t really know it at the time, but I worked in a grocery store and the work can be a bit mundane at times. So I used to like sort of observing people and how they shopped for things and trying to sort of predict based on who they were, what they looked like, what they would buy. So the psychology around people making purchase decisions was really interesting to me. I took a consumer behavior class in college, I really, really liked it, and then I started reading Advertising Age magazine at the library. I became fascinated with the industry and it seemed to be this combination of a lot of things I enjoyed. It had business ... there were aspects of film and art and culture and music and all those things that kind of came together in the interest of commerce. So, I decided I wanted to get in the business and I’ve been at Doner for 33 years.  Could you talk about how the ad industry has changed in metro Detroit? It’s changed in so many ways, we could talk for days about it. The biggest changes, not just Detroit, have been driven by changes in the media landscape at large. The advent and acceleration and now ubiquity of digital communications has changed the business incredibly in terms of how we think about creating advertising, what we say, where we say it, all those things. You attach the explosion and ubiquity of digital communications to having so much data, you know, now. Those two things have created a lot of change in the types of talent we need in the company, the way we conceptualize work, the way we evaluate the work ... But in conjunction with that, the world is still mesmerized by great storytelling. It’s just the story comes to life in different ways, in different places. But you still need those storytelling abilities to stand out.

 You guys are going back to the office in kind of a different way, right? We have brand new office space, 60,000 square feet now, in the Galleria building (in Southfield). (Our space) has been totally redesigned to facilitate what we think is going to be the new way of working, which is far more flexible, far more collaborative. There are all kinds of spaces in the space for large groups, for small groups, for privacy, for collaboration, highly tech-enabled, so you want to Zoom with somebody you just press a button and boom. There’s probably a million screens in the office [laughs]. We’re going to allow people to work flexibly. My hope is that people start coming into the office and spending more time there. We’re just starting to open it now. When you see people together, the smile on their face ... I think slowly but surely more people are going to want to come back to the office more. I don’t think it’s going to be five days a week. What we’ve talked a lot about is taking the office from being an obligation to being a destination. A place you don’t feel you have to go, you want to go. But if you want to stay home some days because that fits your life, that’s cool, too.  How much did you invest in redesigning the space? I can’t recall the number, to be perfectly honest, but it was in the millions.  Going back to your career: What’s a project you’ve done that you look back as really creative? Well, look, for me, being originally from New Jersey, being part of the team that was able to develop a piece of advertising that Bruce Springsteen wanted to be a part of for Jeep on the Super Bowl in 2021 was, you know, that one’s up there. It was a 2-minute epic piece of advertising that took a point of view about what might be the most important topic of our time, the political divisiveness in this country. So to have a client that was willing to embrace that

issue, to have a team that came up with an amazing concept, to have a script that Bruce Springsteen said ‘Yeah, I’d like to be a part of that,’ when he’s never ever done a commercial ... that was pretty amazing.  Did you get to work with him directly? Our team did. I resisted the urge because I sort of felt the last thing they needed was a CEO fanboy on the set. I let our small team and our client, and I had all the confidence in the world in them, but I was getting reports on the hour.  I also read somewhere you’re pretty competitive. Can you talk about how that manifests itself? Yeah, look, I’m a competitive person. It just kind of runs in my blood. I played sports my whole life and things like that. The advertising agency business is incredibly competitive. You were asking how the business has changed. It used to be there were a lot of established names, and there still are, but the barriers to creating an ad agency are not that big because you just need a computer and an idea and a client and there you go. So we compete against giant global networks down to a couple guys in the basement. The other thing I like is ... win or lose (a request for proposal process from a potential client), we try to really understand why, so we can learn from it and apply that learning going forward.  You’re on the board for the Museum of Con-

temporary Art Detroit — you like contemporary art? Yes, I collect contemporary art.  Do you like KAWS (the name used by a figure artist named Brian Donnelly who’s a favorite of local billionaire Dan Gilbert)? I have nothing from KAWS. I’m familiar with the work. But I am staring right now at a pretty amazing piece by Jonas Wood. It’s a basketball growing out of a plant, of all things.  OK, I’m picturing it. Google it. [laughs]

ADVERTISING/MARKETING

David DeMuth is CEO of Doner

CRAIN’S DETROIT BUSINESS

Sales Inquiries (313) 446-6032; FAX (313) 393-0997 Director of Events and Program Content Kristin Bull, (313) 446-1608 or kbull@crain.com Events Director Samantha Flowers Senior Account Executives Maria Marcantonio, John Petty Advertising Sales Lindsey Apostol, Ainsley Burgess, Sharon Mulroy Content Marketing Specialist Allie Jacobs People on the Move Manager Debora Stein, (917) 226-5470, dstein@crain.com Marketing Manager Lynn Zott, lzott@crain.com or (313) 446-6762 Senior Art Director Sylvia Kolaski Media Services Manager Nicole Spell (212) 210-0230 or nspell@crain.com Classified Sales and Sales Support Suzanne Janik CUSTOMER SERVICE

Wright Lassiter III: Doing right thing not a challenging decision

Henry Ford Health President and CEO Wright Lassiter III | BRETT MOUNTAIN FOR

Jason Davis, small and emerging businesses. (313) 446-1612 or Jason.davis@crain.com Annalise Frank, city of Detroit. (313) 446-0416 or afrank@crain.com Arielle Kass, residential real estate, (313) 446-6774 or arielle.kass@crain.com Nick Manes, finance and technology. (313) 446-1626 or nmanes@crain.com Kurt Nagl, manufacturing. (313) 446-0337 or knagl@crain.com Kirk Pinho, senior reporter, real estate. (313) 446-0412 or kpinho@crain.com Dustin Walsh, senior reporter, health care. (313) 446-6042 or dwalsh@crain.com Sherri Welch, senior reporter, nonprofits and philanthropy. (313) 446-1694 or swelch@crain.com CLASSIC $169/yr. (Can/Mex: $210, International: $340), ENHANCED $399/yr. (Can/Mex: $499, International: $799), PREMIER $1,299/yr. (Can/Mex/International: $1,299). To become a member visit www.crainsdetroit.com/ membership or call (877) 824-9374 Group and Corporate Membership Sales Deb Harper, (313) 446-1623 or dharper@crain.com

RUMBLINGS

against the coronavirus for health care workers wasn’t hard for him. It was concern about staffing and the aftermath of the decision that he had to consider. “The consequences were harrowing for us,” he said. “It didn’t make the decision any less the right decision to make.” Before the vaccine mandate was announced, Lassiter said, he and other executives listened to staffers’ concerns. At the time, he said, just over 60 percent of employees had been vaccinated. But the health system had previously required employees to get vaccinated for the flu and looked to that, as well as the science and data, before coming to this

REPORTERS

MEMBERSHIPS

READ ALL THE CONVERSATIONS AT CRAINSDETROIT.COM/THECONVERSATION

IF YOU’RE DOING THE RIGHT THING, Henry Ford Health President and CEO Wright Lassiter III said Thursday, it’s not a challenging decision. Lassiter, honored last Thursday as Crain’s Detroit Business’s Newsmaker of the Year, had a year full of decisions. He led the first major health system in Michigan that mandated the COVID-19 vaccine for employees and helped bring back the Mackinac Policy Conference. He also sealed a new partnership with Michigan State University that is likely to lead to construction of a new medical school in the city of Detroit. In conversation with Crain’s Publisher KC Crain, Lassiter said the actual decision of mandating vaccines

crainsdetroit.com

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

decision in a “respectful and compassionate way.” “I felt like there would be strong support,” Lassiter said. “We knew that we would face challenges.” Calling the front-line health care staff those who were facing the battle against the virus, Lassiter said it was up to leadership to play for tomorrow, and for further down the line as the pandemic ravaged the community. Bud Denker, the president of Penske Corp. and another Newsmaker honoree, paid tribute. “They have looked the devil in the eye every day for the last two years,” he said of Henry Ford health care workers.

Single copy purchases, publication information, or membership inquiries: (877) 824-9374 or customerservice@crainsdetroit.com Reprints: Laura Picariello (732) 723-0569 or lpicariello@crain.com Crain’s Detroit Business is published by Crain Communications Inc.

Chairman Keith E. Crain Vice Chairman Mary Kay Crain CEO KC Crain Senior Executive Vice President Chris Crain Chief Financial Officer Robert Recchia G.D. Crain Jr. Founder (1885-1973) Mrs. G.D. Crain Jr. Chairman (1911-1996) Editorial & Business Offices 1155 Gratiot Ave., Detroit MI 48207-2732; (313) 446-6000 Cable address: TWX 248-221-5122 AUTNEW DET CRAIN’S DETROIT BUSINESS ISSN # 0882-1992 is published weekly, except no issues on 1/3/22, 7/4/22, 11/21/22 nor 12/26/22, by Crain Communications Inc. at 1155 Gratiot Ave., Detroit MI 48207-2732. Periodicals postage paid at Detroit, MI and additional mailing offices. POSTMASTER: Send address changes to CRAIN’S DETROIT BUSINESS, Circulation Department, P.O. Box 07925, Detroit, MI 48207-9732. GST # 136760444. Printed in U.S.A. Contents copyright 2022 by Crain Communications Inc. All rights reserved. Reproduction or use of editorial content in any manner without permission is prohibited.

18 | CRAIN’S DETROIT BUSINESS | MARCH 28, 2022

P018_CD_20220328.indd 18

3/25/2022 1:01:03 PM

2022

In partnership with

CORPORATE COUNSEL SUMMIT KEYNOTE

‘Making it to General Counsel’ Tina Dekker

Senior Vice President, General Counsel and Corporate Strategy Meijer Inc.

PANEL DISCUSSION ‘The Changing Rules and Risks of the Workplace’ Beth Hill

General Counsel and COO FordDirect

Laura Lewis

General Counsel StockX

Apr. 26 | 9am-12:30pm One Campus Martius

crainsdetroit.com/cc-summit

Timothy G. Lynch

Vice President and General Counsel University of Michigan

Archana Rajendra

Vice President and Deputy General Counsel Health Alliance Plan

NETWORKING LUNCH

Supporting Sponsor

T:9.75"

A business with so much bandwidth it transfers enormous files for fun. AT&T Business Fiber now with Hyper-Gig speeds. Fast internet with the security and reliability you need to make large file transfers a breeze. Learn more at att.com/businessfast or call 1.844.740.FAST

Limited availability in select areas. Reliability based on network availability.

T:14"

Business