THE CONVERSATION: David Tsai at the reins of MGM Grand Detroit. PAGE 34
Ethanol push no panacea for farmers
Not enough pumps, infrastructure. PAGE 3
CRAINSDETROIT.COM I APRIL 25, 2022
FORUM
AFFORDABLE HOUSING
OUT OF
Metro Detroit has long been known as an affordable place to live. For more and more people in today's hot housing market, that's not true anymore. Pages 21-26
NIC ANTAYA/SPECIAL TO CRAIN’S DETROIT BUSINESS
REACH Kyle Slominski and Brandy Belcher check out a Roseville home with their real estate agent.
Greektown Casino spins new name
Refugee agencies rebuild amid crisis
$100 million in improvements planned
Nonprofits plan for influx of Ukrainians
BY JAY DAVIS
BY SHERRI WELCH
One of the more recognizable businesses in downtown Detroit is going Hollywood. Beginning May 1, Greektown Casino-Hotel will be rebranded as Hollywood Casino at Greektown. Meanwhile, owner Penn National Gaming Inc. is investing $100 million in improvements to the property, including a new lobby, updated hotel rooms, cashless features for bettors and a partnership with
a local entertainment venue to bring in more national acts. The move comes a little less than three years after Penn National Gaming acquired the Detroit entertainment property from Dan Gilbert's Jack Entertainment for about $300 million. The Detroit location will become the 43rd Hollywood Casino, which also has locations in 19 states, including a Toledo casino that opened in 2012. Greektown Vice President and General Manager John Drake told
NEWSPAPER
VOL. 38, NO. 16 l COPYRIGHT 2022 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED
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A rendering of the Hollywood Casino Hotel.
Crain’s that the change is a part of the property’s evolution. “Now the casino is a part of the premier brand within Penn,” said See CASINO on Page 32
After slowing to a trickle in recent years, refugee resettlement is picking up in Southeast Michigan — and so is hiring at the agencies that work with those new residents. The uptick comes ahead of policy shifts in the White House and foreign conflicts bringing refugees from Afghanistan and soon, Ukraine, to the region. To help thousands of refugees coming to the region this year, reset-
tlement agencies are working to rebuild capacity hollowed out by federal immigration policies during the Donald Trump administration, which significantly decreased the flow of refugees to the U.S. and funding to the agencies. Like other employers, these nonprofits face a competitive labor market. And that’s making volunteers, who help refugees adapt to life in the U.S. and fill employee
SCHOOL DAZE
CRAIN’S LIST
Colleges deal with enrollment drops, new student demands PAGE 8
Graduate business degree programs. PAGES 28-29
See REFUGEES on Page 33
4/22/2022 4:26:08 PM
NEED TO KNOW
OFFICE SPACE
THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT `FAIRLANE TOWN CENTER TO BE SOLD TO DALLAS BUYER
`CONSUMERS ENERGY TO PHASE OUT COAL BY 2025
THE NEWS: Fairlane Town Center is being sold to a Dallas-based real estate company specializing in mall and open-air shopping center ownership and redevelopment, Crain's has learned. Two sources briefed on the matter identified Centennial Real Estate as the incoming ownership group of the 1.4 million-square-foot mall at 18900 Michigan Ave.
THE NEWS: Consumers Energy Co. has reached a proposed settlement agreement with the Department of Attorney General and other stakeholders for updating its clean energy plan to phase out the use of coal by 2025. The settlement, which will require Public Service Commission approval, would enable the Jackson-based utility to phase out the use of coal as a source of producing electricity 15 years earlier than previously planned.
WHY IT MATTERS: It's the latest twist for the mall, built in 1976 and has struggling financially the past few years. Its ownership has fallen behind on debts.
`DTE ENERGY SUPPORTS ENVIRONMENTAL EFFORTS THE NEWS: The DTE Energy Foundation is making a commitment for Earth Day, providing $1.48 million in grants to organizations throughout Michigan protecting the Great Lakes, rivers, trees and wildlife habitats. The funds will be split between seven nonprofits and governmental agencies in Ann Arbor, Traverse City, Muskegon, Lansing and Southeast Michigan, the philanthropic arm of the Detroit utility said. WHY IT MATTERS: The DTE Energy Foundation is making a commitment for Earth Day, providing grants to organizations throughout Michigan.
WHY IT MATTERS: It's part of overall efforts to move toward clean and renewable energy sources. Under the proposal, the utility's remaining coal plant units would be retired in 2025, which it said would make Consumers among the first in the nation to go coal-free by that time.
`DETROIT LAUNCHES PLAN FOR INTERNET INFRASTRUCTURE THE NEWS: Detroit's Hope Village neighborhood will be the pilot area for a $10 million project, using American Rescue Plan Act funding, to deliver high speed fiber optic internet access to every home and business in the neighborhood. The Hope Village section of the city, home to about 5,700 people, experienced a 45-day internet outage during the COVID-19 pandemic,
WHY IT MATTERS: Detroit has long struggled with limited accessibility for highspeed internet, furthering the digital divide.
`RIVIAN SUPPLIER ADDING JOBS AT ROCHESTER HILLS PLANT THE NEWS: BOS Automotive Products Inc. is planning to invest $1.1 million and create 50 jobs to expand production at its plant in Rochester Hills. The expansion will support a contract with Rivian Automotive Inc., which tapped the supplier to make a retractable metal tonneau cover for its R1T electric truck, according to a briefing memo from the Michigan Economic Development Corp. WHY IT MATTERS: The new jobs are expected to pay $680 per week, with benefits, training and opportunity for advancement, according to the state.
`PALAZUELO MISSES PACKARD PLANT DEADLINE
Deloitte sheds large RenCen office for smaller space Consulting firm Deloitte LLP is substantially downsizing its prime downtown Detroit office footprint. An employee confirmed that the London-based company is moving next week from the Renaissance Center into the Dan Gilbert-owned 1001 Woodward Ave. high-rise. Deloitte's RenCen office spans six floors — the 24th, and the top 35 through 39 — totaling approximately 102,000 square feet in the 200 tower. The company is taking WeWork space in 1001 Woodward, about 35,000 square feet, a source said. WeWork has about 44,000 square feet there. It's not known how many employees are impacted or whether Deloitte was using all of its 102,000 square feet prior to moving out. The move is a big hit for the 39-story skyscraper, which is 593,000 square feet and only about 53.5 percent leased, according to the annual JLL Skyline report released in September. Deloitte vacating will only make those numbers worse. The Renaissance Center. | ANTHONY LANZILOTE/BLOOMBERG
THE NEWS: The Packard Plant’s owner, Fernando Palazuelo, missed a court-ordered deadline to apply for a demolition permit for the long-decrepit plant he owns on Detroit's east side. WHY IT MATTERS: The city of Detroit is now one step closer to being able to demolish the failed redevelopment site and and bill Palazuelo for it.
INDUSTRY ACHIEVERS ADVANCING THEIR CAREERS Recognize them in Crain’s
For listing opportunities, contact Debora Stein at dstein@crain.com or submit directly to
CRAINSDETROIT.COM/PEOPLEMOVES
2 | CRAIN’S DETROIT BUSINESS | APRIL 25, 2022
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GOVERNMENT
REAL ESTATE
Ethanol order won't be boon for farmers Biden’s plan is likely to fall short in Michigan BY DUSTIN WALSH
The Left Field site in Corktown at Michigan and Trumbull avenues. It’s now being used as a Detroit Police Athletic League headquarters and the land around it will soon be developed with new apartments. | KIRK PINHO/CRAIN’S DETROIT BUSINESS.
Corktown housing plan behind schedule Rising costs plague project — along with a fight over a scoreboard BY ARIELLE KASS
break ground last summer. Rising construction costs have pushed A signature affordable housing back the $15 million project, said Juproject in Detroit's Corktown neigh- lie Schneider, director of Detroit's borhood is more than six months Housing and Revitalization Departbehind schedule, a delay that is hav- ment. Schneider said the project is ing ripple effects for other affordable "about two quarters behind," but housing plans. she anticipates a ground“(COST) QUOTES ARE INCREASING. breaking next month. The timing matters because a GAPS ARE INCREASING.” plan to rebuild the affordable Clement Kern Gar— Julie Schneider, director of Detroit’s Housing and Revitalization Department dens, including the reestablishment of a street The Left Field development, on grid and the razing of units, won't land that was once part of the old Ti- proceed until the residents there ger Stadium, was originally slated to have somewhere else to go.
Both projects are part of the federal Choice Neighborhoods grant the city was awarded last year to add hundreds more affordable housing units to the Corktown area. Schneider said the program's educational, workforce and health care components, as well as other pieces of the grant, mean there have continued to be opportunities for residents, even as construction is delayed.
A scoreboard dispute At the same time, an ongoing dispute about a scoreboard threw a wrench into the development, though Schneider said it wasn't the
cause of any delays. Last June, Detroit's Police Athletic League received a notice that a scoreboard they had erected on a multiuse field on the old stadium site had been built without a permit, and on land owned by the city's Economic Development Corp., according to correspondence obtained through an open records request. Other issues PAL was required to resolve included insufficient parking and bright lights and noise that were considered a nuisance to neighbors already living in townhouses in the area.
but not pleasant, punch in the gut" in the current market, where an increasing number of large teams of lawyers are jumping from firm-tofirm, Foltyn said. "It's fairly consistent with what's going on in the market, particularly in Chicago, particularly in private equity," Foltyn said. "And we intend to just go back to work and keep doing what we we're doing." When Honigman started expanding into Chicago in 2015, its longtime partners knew the strategy could be boom or bust for a Detroit firm founded in 1948 and formerly known as Honigman Miller Schwartz and Cohn LLP. See HONIGMAN on Page 31
See ETHANOL on Page 31
See CORKTOWN on Page 30
Honigman's Big Law poaching goes the other way BY CHAD LIVENGOOD
About seven years ago, Detroit-based Honigman LLP started recruiting some rising stars away from bigger law firms to build up a private equity and M&A practice in Chicago. The attorneys came from the global legal business behemoth of Kirkland & Ellis and Katten Muchin Rosenman LLP, a Chicago-based firm twice the size of Honigman. The lateral hires of four partners
from those firms who specialize in closing deals for mid-market mergers, acquisitions and private equity investments helped Honigman start and build a Chicago office to more than 60 lawyers. On Thursday, the four partners and 23 of their as- Foltyn sociates abruptly left Honigman and took their practices back to Big Law, joining the multinational 4,000-attorney law firm of DLA Piper. “The four guys were great … for the firm’s revenue and profitability,” Honigman CEO David Foltyn lamented Friday. "... Obviously, I’m not happy about it."
But all is not lost, the veteran law firm executive said. Honigman still has more than 80 attorneys who work in the private equity and M&A space, and the firm's Chicago office continues to grow its client base in the practices intellectual property, technology and real estate, Foltyn said. "The overwhelming bulk of the practice continues," he said. "The platform is great, it continues to be great." That the firm lost more than a third of its Chicago-based attorneys in one fell swoop is a "not shocking,
Corn syrup, not gas Only 2,300 out of the nation’s 168,000 gas stations currently carry E15, often branded as Unleaded 88. Only an estimated six stations — or 0.11 percent of total stations — in Michigan carry the ethanol fuel mix. Legislation passed last year removed waivers for gas stations near drinking water wells to dig up their old fuel tanks and replace them with tanks rated to hold an arguably more corrosive E15 blend. “EPA requirements require a gas station’s equipment, pipes, tanks, dispensers can handle all the fuel they are dispensing,” said Mark Griffin, president of the Michigan Petroleum Association. “The problem is no one even knew E15 was a possibility when they bought their equipment and no one kept track. We don’t have a list of as-built materials for a station that was built 10 or 15 years ago. We can’t know if the equipment is compatible unless we dig up the tanks. A brand new station can buy the proper equipment, but we have no idea if the older stations can.” The Michigan Petroleum Association represents 4,800 stations in the state along with fuel distributors, many of which are also station owners. Griffin said his members are not “anti-ethanol” but are limited in their ability to increase the needed infrastructure under the current rules.
LAW
27 lawyers in major Chicago office leave firm for DLA Piper
President Joe Biden’s plan to curb soaring gasoline prices with more availability of biofuels during the summer is likely to fall short of any real economic boost in Michigan. Biden’s order will allow Americans to keep buying E15, a gasoline that uses a 15 percent ethanol blend made from feed corn, between June 1 to Sept. 15 this year. E15 is about 10 cents cheaper on average than regular unleaded gasoline and the administration hopes it relieves some pain at the pump. The decision is a win for the corn lobby, which has been pushing for higher ethanol use for more than a decade to provide increased corn use, thus increasing cash flow to American farmers. But experts predict its impact on Michigan corn farmers and drivers will be muted due to a lack of existing nfrastructure to get E15 to the pumps. Unless Biden’s E15 waiver becomes permanent it is unlikely that this infrastructure will be expanded. “This is positive for agriculture, but in reality it’s not going to do a whole lot for us initially” said Scott Miller, owner of Miller Family Farms in Elsie, 45 miles northeast of Lansing. “I hate to be a Debbie Downer, but there’s just not enough outlets across the nation to make this announcement have any real material impact.”
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Bank of America leaving its regional headquarters in Troy BY KIRK PINHO
Bank of America is leaving its Troy regional headquarters. The Charlotte, N.C.-based bank's decision to not renew its expiring lease at 2600 W. Big Beaver Road marks perhaps the biggest local office tenant loss of the pandemic so far. It is a major blow to the New York City-based landlord who bought the roughly 439,000-square-foot building less than five years ago for one of the highest local per-square-foot acquisition costs at the time. Bank of America leases about 144,700 square feet in the property. The bank is its biggest tenant behind the Dickinson Wright law firm, which has 67,800 square feet, according to commercial mortgage-backed securities loan commentary from New York Citybased Trepp LLC. And although many companies remain in hybrid work mode, or largely staying at home, due to the pandemic, Bank of America's decision to shed all of its space in the building — rather than put it up for sublease, for example, as has happened elsewhere — is a loss not felt on this scale since COVID-19 rocked the office sector in March 2020. Diane Wagner, a spokesperson for Bank of America based in Chicago, confirmed the bank is moving the nearly 350 employees in the Troy building to three other locations in the suburbs: 39577 Woodward Ave. in Bloomfield Hills; 3030 Cross Creek Parkway in Auburn Hills; and 39001 W. 12 Mile Road in Farmington Hills. "Bank of America is always evaluating options to make best use of our space and provide a more vibrant environment for our teammates so they can connect and collaborate more easily," Wagner said in an email. "This decision is in keeping with our approach to manage our real estate portfolio as effectively and efficiently as possible." The lease expires at the end of January, she said.
A tough loss The loss of its largest tenant jeopardizes the building's financial future. Trepp data says that although the building's $47.6 million CMBS loan through Citi Real Estate Funding Inc. is current, the loan was placed on a watchlist in August because there is a lease for a tenant — Bank of America — occupying more than 30 percent of the building expiring in the next 12 months. Bank of America takes up 35.2 percent of the net rentable area, Trepp says. The loan, which has a current balance of about $45 million, matures in September 2024. With the office market remaining in flux, it could be difficult to fill a space that size with only a little more than two years remaining before the balloon payment is due. But that doesn't mean everything is gloomy for the building. Owner Sol Gutman has squeezed more money out of the
REAL ESTATE INSIDER
building every full year of its ownership, according to Trepp data. In 2018, net operating income was $5.39 million, increasing to $5.88 million in 2019, $7.22 million in 2020 and $8.29 million in last year. Revenue rose and expenses decreased each of those years. Peter McGrath, associate director in the Detroit office of the Savills plc brokerage house, said the Bank of America building "is recognized as one of the leading buildings in Troy and Metro Detroit due to its roster of tenants, high-level finishes, abundant amenities and ideal location across from Somerset Mall. "The market is currently experiencing a flight to quality, and we expect to see considerable interest from prospective tenants given the building’s standing," McGrath said.
A quirky history Gutman bought it in 2017 from New York City-based Sovereign Partners LLC, which paid Bank of America just $35 million for it in 2015. The building — and its previous owner — have always had their quirks. CMBS loan commentary from DBRS Morningstar, a division of Chicago-based Morningstar Inc., says at that time of the 2015 sale, Bank of America would not disclose property financial statements or disclose how much space it took in the building to prospective buyers — rare in the commercial real estate sales process, and likely contributing to its low trading cost seven years ago. The restrictions placed on employee behavior in the building after it was constructed in the late 1980s are part of local workplace lore. The building was built for Standard Federal, which was then acquired by LaSalle Bank, which was then acquired by Bank of America. When it opened, employees couldn't bring anything to eat or drink to their workspaces — including bottled water, lunch or coffee — because of fear of crumbs or stains. It had been dubbed the "Taj Mahal" or "Fort Federal" because of the rules and the big vision for the building by the late Thomas Ricketts, the former president and CEO of Standard Federal. Subsequent bank executives worked to change that vision from a building that was part art museum-part bank office to something more modern. Today, the building features everything from water features to a game room to an outdoor ninehole putting green and fitness facility. It sits on a massive 26-acre site and includes more than 1,400 parking spots, about half of which are covered, according to CBRE marketing materials. In 2007, it became the first existing building in Michigan to receive Leadership in Energy and Environmental Design, or LEED, gold-level designation from the U.S. Green Building Council, the second-highest designation. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB
The Hudson’s project has faced setbacks which have pushed the development two years behind schedule. | KIRK PINHO/CRAIN’S DETROIT BUSINESS
Bedrock replaced owner's rep on Hudson's site project, won't say why Consider this the latest shake up in the J.L. Hudson's site contractor roster. New York Citybased Turner Corp., which has an office in DeKirk troit, has been PINHO brought on as owner's rep for Dan Gilbert's Bedrock LLC, replacing Jacobs Engineering Group, I'm told. However, no one at Bedrock is saying why they shuffled Dallas-based Jacobs — which has offices in Bingham Farms and Shelby Township — off the team building the long-delayed skyscraper that will replace the famed department store imploded in 1998. Emails sent to Bedrock about Turner's involvement have not been answered. If you're not familiar with the term, think of an owner's rep as an extension of the company that hires them — in this case, Bedrock. They are brought on to monitor various aspects of a project — in this case, the Hudson's development — and ensure that they adhere to certain budgets and timelines (I know, I know, insert witty joke about the delays on the project here). Southfield-based Barton Malow Co. remains the general contractor, while New York City-based Shop Architects is the design architect, along with Houston-based Kendall/ Heaton Associates (which worked on what is now Ally Detroit Center), and Detroit-based Hamilton Anderson Associates is landscape design architect and interior design architect on the hotel component. Earlier this month, I reported that Edition, the brand designed by Studio 54 co-founder Ian Schrager, is going to be the hotel occupying the tower component of the development on the southern portion of the 2.3-acre site at the corner of Wood-
ward and Grand River avenues downtown. Barton Malow and Turner have a history of working together on big projects. Among them are Soldier Field, home of the NFL's Chicago Bears, and Paul Brown Stadium, home of the Cincinnati Bengals. It's also not the first time Gilbert's team and Turner have worked together. The company did work on the former Detroit Free Press building downtown's conversion into a mixed-use building that's now called The Press/321, as well as the Quicken Loans Technology Center in Corktown. Both Turner and Barton Malow declined comment. A message was sent to Jacobs Engineering Tuesday morning seeking additional information. The Hudson's project, which broke ground in December 2017, has faced a series of setbacks and challenges, including unanticipated underground obstructions, multiple design changes and other factors have pushed the development, now slated to rise 685 feet, to be two years behind its original schedule. The tower component at the southern edge of the property has fluctuated in height, initially proposed to be 734 feet, making it the tallest building in the state, then rising to 800 feet, then to as high as 912 feet before softening those numbers and settling on approximately 680 feet. The most recent expected height is 685 feet, 4 inches. The tallest building in the city is the Detroit Marriott at the Renaissance Center, which stands 727 feet. The project includes two key components: The skyscraper, with 100 to 120 units of residential space and hotel space, and on the northern portion of the site, what's referred to as the "block" building, with hundreds of thousands of square feet of office, meeting, retail and restaurant space.
The two buildings are separated by what's to become an activated alley. After years of primarily below-grade work, both are now well above ground level. The project is one of four Gilbert has underway totaling about $2.14 billion. Combined, they received a total of $618.1 million in so-called "transformational brownfield" tax incentives from the state. The other projects are the long-delayed $830 million Monroe Blocks project immediately east of the One Campus Martius Building, the $311 million redevelopment of the Book Tower and Book Building on Washington Boulevard set to finish this year, and the $95 million addition to the One Campus Martius building where Gilbert has his Rocket Companies Inc. (NYSE: RKT) headquartered.
Downriver's tallest building sells for mixed-use project The 14-story Southgate Tower has sold to a developer that plans on turning it into apartments. The sale for an undisclosed price was announced by Farmington Hillsbased Friedman Real Estate, which brokered the deal. Southgate Tower LLC, which bought the vacant former bank office building, is tied to Alexander Begin. The purchase price from previous owner 16333 Trenton LLC was not disclosed. The release says the project includes plans for 201 apartments. The 12.8-acre site allows for future development which is currently unplanned.
Hit me up Email: kpinho@crain.com Desk: (313) 446-0412 Twitter: @kirkpinhoCDB
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A DONOR’S IMPACT: SECOND IN A SERIES
SPONSORED CONTENT
SUPPORTING PHOTOS BY BEAUMONT HEALTH
‘BEST IN CLASS’ MEDICAL TECHNOLOGY James and Patricia Anderson gave $5 million to Beaumont Hospital, Grosse Pointe for surgical center and ‘indefinite’ replacement of life-saving technology. There are many reasons James and Patricia Anderson established an endowment fund as part of their $5 million gift to Beaumont Hospital, Grosse Pointe. Some of the reasons are from the head; others are from the heart.
James and Patricia Anderson
The 2020 gift, which supports the creation of a hybrid surgical suite at the hospital as well as an Advanced Surgical Technology and Training Endowment Fund, was the largest ever received by the Grosse Pointe hospital and is part of a $19 million ongoing renovation to the center, which is named in the donors’ honor: the James and Patricia Anderson Surgical Center. James Anderson, CEO of Urban Science, a data and science firm that supports the automotive industry, has spent his career in the technology business and knows firsthand that hardware and software quickly get out of date if not maintained. “I know the medical world is getting more dependent on technology,” Anderson said. “It takes significant investments to stay cutting-edge. This project includes acquiring and maintaining equipment and up-to-date training for the doctors, nurses and staff to use that equipment.” The endowment fund, he said, will
support technology needs for the surgical center indefinitely. ‘To always be current and best in class’ Anderson said that in 1910, his father came to the United States from Norway and spent a significant amount of time working to build the Dodge family’s Rose Terrace estate in Grosse Pointe Farms. Just 40 years later, Anderson remembers walking his father through the house for a final tour before it was demolished to build a subdivision. “My dad kept saying, ‘Why in the world would they tear this down? We worked so hard to build it,’” Anderson recalled. “The impression that made on me is what a disposable society we live in. This equipment my wife and I are providing will have the same fate: it will be obsolete and thrown away. That is why we are willing to pay for the endowment, to always be current and best in class. It’s not easy to build things that last forever and that’s what an endowment does.” The $19 million renovation to the hospital’s surgical center encompasses eight phases over two and a half years. A 900-square-foot hybrid surgical suite is
the centerpiece of the James and Patricia Anderson Surgical Center; $3 million of the Anderson gift was used to build the hybrid suite. A hybrid surgical suite is larger than traditional operating rooms and combines surgical equipment, tables and lights with fixed advanced imaging systems. Surgical teams have the capability to perform a wide array of procedures ranging from a traditional open approach to a minimally invasive procedure.
reasons behind the gift. And then there is a heartfelt, more emotional one: the Andersons’ grandchildren were born at the hospital. The Andersons hope their gift will contribute to the community that not only their children want to live in, but that someday their grandkids might choose to live in, too. When asked why he would encourage others to give to health care through Beaumont, Anderson noted health care’s deep ties to the community.
“IT’S NOT EASY TO
“Most of us come from a “The Andersons’ generous BUILD THINGS THAT small town and enjoy gift has helped our LAST FOREVER AND living in a small town phenomenal clinical team where we are friends with save lives at Beaumont THAT’S WHAT AN our neighbors, know our Hospital, Grosse Pointe. We ENDOWMENT DOES.” merchants, teachers, are so fortunate they chose James Anderson elected officials and to support our hospital and medical professionals on a our community,” said first-name basis,” Anderson said. Thomas Lanni, president, Beaumont Hospitals, Grosse Pointe and Troy. “Quality health care is important to both “Technology is always changing and me and my wife. We hope the impact of improving. Their gift helps us continue to our gift gives readily and conveniently provide leading-edge care to our patients.” best-in-class choices for patients in our community in perpetuity.” Fulfilling a need to contribute to the community Learn more about how you can make an impact at Beaumont.org There are those rational, business-case
APRIL 25, 2022 | CRAIN’S DETROIT BUSINESS | 5
COMMENTARY
Why Silicon Valley needs the Heartland DANIEL SAAD FOR CRAIN’S DETROIT BUSINESS
BY PHILOMENA MANTELLA
COMMENTARY
Mine subsidy highlights political backscratches
T
axpayer money is going into the ground. A $50 million subsidy from the $4.7 billion supplemental spending bill signed by Gov. Gretchen Whitmer last month will help fund a $1.1 billion potash mine in rural Osceola County. The funding is described by legislators as a sort of mezzanine financing to secure further investment into the Michigan Potash & Salt Co. development, which has been in the making for 12 years. Michigan Rep. Jason Wentworth and others told Bridge Magazine the investment is for national security and to ensure Michigan farmers have a reliable source of the macronutrient vital to THAT 15,000-ACRE fertilizer production. WHITE POTASH They are right that the mine has DEPOSIT ISN’T supply chain valGOING TO STEP OUT ue. Roughly 96 of potash OF THE EARTH AND percent comes into the MOVE TO INDIANA. U.S. from foreign producers, some of which did from now sanctioned Russia and Belarus. With those suppliers carved out of the Western market that effectively gives Canadian producers, including the world’s second-largest producer Nutrien, uncontested control of the market here. It’s an easy argument that the deposit, one potentially worth $65 billion, should be mined and it will aid Michigan farmers. But the $50 million in tax payer funds remains suspect. Typically, subsidies and tax incentives are justified due to competition. General Motors, in theory, could have put their planned battery plant in Texas instead of Michigan if tax incentives didn’t juice the deal. We’ll sidestep in this column the argu-
Dustin
WALSH
ment that GM was always going to place a plant that supplies very heavy battery packs close to its plants that assemble electric vehicle. This is different, though. The 15,000-acre white potash deposit nearly a mile and a half below the surface in Osceola County isn’t going to step out of the earth and move to Indiana. There is no threat of interstate competition. The state’s subsidy is about 4 percent of the total project costs. Is that really enough to bring big-brand banks to the table? To provide security to their loan? I doubt it. In fact, only days after the spending bill was signed, MPSC announced a lucrative deal to sell 650,000 short tons of the macronutrient used in fertilizers annually to one to one of the nation’s largest food processors and commodities traders, Chicago-based Archer-Daniels-Midland Co. MPSC’s production of potash has a current market value of more than $550 million, annually. That deal surely would have provided far more investor confidence than $50 million from the state. Instead the subsidy is more reminiscent of political chess. For decades, big money economic development projects settled near the state’s population bases in Southeast and Southwest Michigan. Taxpayer-funded grants and tax See WALSH on Page 33
gines and transmissions,” stated a recent New York Times article. These companies “are hiring engineers and t’s easy to be jealous. For decades, programmers to design their own San Francisco, Seattle, and New chips and write their own software.” York have had a lock on nearly all What’s happening in Michigan is the high-tech companies and the also happening across the country as tens of thousands of jobs that they nearly every kind of business activity generated. “Fly-over country” was is quickly adopting technological inleft out. novation. Employers everywhere Things have changed. Philomena need programmers, engineers and The COVID-19 pandemic opened Mantella is other skilled technical workers. the door to remote work for millions president of Are we ready to take advantage of of Americans. Many in coastal tech Grand Valley this moment? My worry is we are not. hubs realized they were fed up with State University. “Michigan also must compete for the high cost of living and long comknowledge-based jobs, which are the mutes. Today there are some promising signs the high-tech economy so long asso- ones that are growing in today’s economy,” arciated with Silicon Valley is coming to our gues auto industry advocate Glenn Stevens Jr., backyards. The question is: Are we ready to head of MichAuto. “To win knowledge-based jobs, we need to re-invest in higher education, meet this extraordinary opportunity? A recent Brookings report noted that “major move more university discoveries to market, tech companies such as Palantir, Hewlett Pack- increase people trained in high tech at all levard Enterprise, Oracle, and Tesla have moved els, retain them, and invest in our communities their headquarters from California to Denver, so they are attractive places to live, work and Houston, or Austin, Texas. Most recently, Intel play.” Employers need new talent, while at the announced the siting of two semiconductor plants in the Columbus, Ohio, area, prompting same time they must up-skill 50 percent of their excitement about the rise of a ‘Silicon Heart- current workforce. Higher education needs investment to exponentially increase production land.’” Michigan, my home, is another example of of skilled talent and must do so with a mindset this growing “Silicon Heartland.” Today, the Big and pace commensurate to the urgency of this Three automakers and the state government historic opportunity. Universities cannot conare working together to open new high-tech tinue to resemble “assembly lines” of old that plants and office parks across Michigan. We are take four to five years to deliver a graduate. We experiencing a historic economic opportunity need to be agile and innovative, reexamine our that three years ago nobody would have be- traditional programs, and create new ways for learners of all ages to access and integrate them lieved. General Motors recently announced it will into their daily lives and work. Make no mistake, investing in our public invest $7 billion in building or revamping facilities in Michigan, adding 4,000 new jobs. Cross- colleges and universities to prepare the talent town rival Ford is transforming from a tradi- of tomorrow is building out critical infrastructional manufacturer into a high-tech company. ture, just as surely as building roads, bridges, Ford recently said it would split into three divisions: internal combustion manufacturing, electric vehicle development and production, and mobility. Toward that end, Ford conceived and is building the Michigan Central Mobility District in downtown Detroit, headquartered in the abandoned Michigan Central train station. In announcing this airports, and the Internet. We must make up for exciting redevelopment effort, Ford will be an under-investment in public higher educabringing together “innovators, educators, poli- tion, which today keeps Michigan higher-educy makers, and companies to solve real-world cation funding at 2003 levels. Sadly, the story is mobility challenges in a dynamic urban com- the same in many other states. We must move munity and sharing those solutions with cities forward, not sit still. You would expect a university president to around the world.” Suppliers are also on the move. LG Energy Solutions just announced a make this case. However, I am not alone. Em$1.7 billion investment to quintuple the output ployers like Ford and GM are desperate to find of its electric vehicle battery plant in Holland, skilled talent and they are clear on the industry competencies needed to drive their businessMich. The traditional automakers are morphing es. The data is clear that investing in higher edinto high-tech companies that happen to make ucation is one of the smartest things a state can cars. “Cars are becoming increasingly digital, defined by their software as much as their enSee MANTELLA on Page 7
I
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.
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6 | CRAIN’S DETROIT BUSINESS | APRIL 25, 2022
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OTHER VOICES
Why direct care workers deserve a $4-an-hour raise BY SHERRI BOYD
“We’re stretched beyond the point of reason. I’m not sure how we’re going to make it.” These words, spoken recently by the head of a Michigan behavioral health service agency, are haunting. They signal the rising level of fiscal hardship and regulatory fatigue that now plagues caregivers providing direct support to people with developmental disabilities and menSherri Boyd is tal health issues. executive Two years after director and the onset of CEO of The COVID-19, MichArc—Michigan. igan’s direct care workforce has been hard hit by rising labor costs, burnout, and a shortage of skilled workers. To help combat these issues, advocates continue to press for increased state-level funding. After all, the job market isn’t what it was pre-pandemic. Today’s fastfood workers are making at least $18 per hour, often with other benefits such as tuition reimbursement or paid time off. In contrast, Michigan’s direct care workers earn an average starting wage of around $14 per hour in the state’s behavioral health system. This includes the state’s recent $2.35 per hour wage increase, which lawmakers intended to make permanent when preparing last year’s budget. That’s the same rate of pay as many high school students can earn at a summer job. And it’s certainly not enough to support an individual or
And what they’ve got isn’t enough. family — not by a long shot. The result of this shortfall is that But here’s the problem: direct care workers receive their pay via state many direct care workers are simply wage passthroughs, and these dollars choosing to leave the profession. Inare limited. It’s simply not possiIT’S LONG PAST TIME THE STATE OF ble for families and agencies MICHIGAN BEGAN TO SOLVE THIS who compensate direct care work- CHALLENGE FOR THE PEOPLE OF OUR STATE. ers to simply “raise their rates” without legislative dividuals and families are losing the action. help they need. And many of our This means that while other em- state’s most vulnerable residents are ployers can raise their wages to keep either being pushed back into resipace with the current labor market, dential settings or trying to go it alone. those who employ direct care workNo matter how you look at it, this is a problem that won’t be going away ers are stuck with what they’ve got.
soon. That is why a strong coalition of behavioral health advocates has come together to propose a state General Fund appropriation of $127 million in fiscal year 2023 which would increase the average starting wage rate in the behavioral health system by $4 per hour to approximately $18 per hour. This calculation is based upon an estimated 50,000 direct support staff providing community living supports and other services funded through the behavioral health system. The state of Michigan has the resources required to meet the needs of this important population. And the economic benefits of action are clear.
According to an analysis prepared by Great Lakes Economic Consulting, a $5 per hour increase in direct support staff wages would provide economic benefits to the state of Michigan totaling $261 million. These benefits would include reduced turnover and increased economic activity and tax revenue. Even better, many Michigan direct care workers would be able to end their reliance on public assistance. It’s long past time the state of Michigan began to solve this challenge for the people of our state. We have the means and structure to do what’s best; all that’s needed now is the will to make it happen.
WANTED:
EXCEPTIONAL MICHIGANDERS UNDER 40
MANTELLA
From Page 6
do to grow jobs and the economy in ways that benefit everyone. Economists at the New York Federal Reserve summarized the key takeaways, making the point that higher-education institutions “also play an important role in their local economies by helping regions build their skilled workforces. This contribution is significant because regions with higher levels of human capital — measured by the share of the working-age population with at least a bachelor’s degree — tend to be more innovative, have greater amounts of economic activity, and enjoy faster economic growth, and workers in these regions tend to be more productive and earn higher wages. We find that doubling a metropolitan area’s degree production is associated with a 3 to 7 percent increase in local human capital levels.” What does this tell us? If you want a vibrant state and local economy, create and support a vibrant higher education sector. The data is undisputed. Dollars alone are not sufficient. We must reward institutions that embrace innovation, access, improved completion rates, new forms of work and learning and reduce time and cost of education. The road ahead is clear. We need an all-in partnership among higher education, business, and government to grow talent in every state to compete and win in this high-tech economy. This is an historic moment. Let’s not waste it.
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A DIMINISHING PIPELINE
Michigan’s colleges juggle new demands, enrollment declines BY NINA IGNACZAK | SPECIAL TO CRAIN’S DETROIT BUSINESS
In the third year of the COVID-19 pandemic, Michigan’s public higher education institutions have found themselves in a landscape rife with challenges — some long-anticipated, others entirely new. Already accustomed to declining enrollment, all but the state’s flagships — the University of Michigan-Ann Arbor and Michigan State University, along with Michigan Tech — saw student attendance drop during the pandemic, with obvious implications for revenue and sustainability. They’re shoring up costs while trying to minimize tuition increases and offset the impacts of any bumps with more financial aid. They’re competing for a smaller piece of the in-state student pie as the state ages and the pipeline of college-bound high school students dries up — and they’re searching for a cohort of students who are missing in action since the pandemic began.
Change in total student headcount, 2019-2021 4.6%
University of Michigan Michigan State University
-0.3%
Michigan Technological University
-0.5% -6.7%
Northern Michigan University Grand Valley State University
-6.8%
Wayne State University
-7.1% -8.7%
Lake Superior State University
-9.0%
Saginaw Valley State University University of Michigan-Dearborn
-9.4%
Oakland University
-9.7% -11.3%
Western Michigan University
-12.1%
University of Michigan-Flint
-13.7%
Eastern Michigan University
-16.9%
Ferris State University Central Michigan University
-20.4%
SOURCE: MICHIGAN ASSOCIATION OF STATE UNIVERSITIES
And they’re facing a student body that demands more flexibility than ever after experiencing remote and hybrid learning. Meanwhile, they’re working to engage younger students who began college without the benefits of in-person instruction and residence hall life, many of whom are now struggling to manage their courses and adapt to being on campus. According to Ryan FewinsBliss, executive director of the Michigan College Access Network, university leaders are asking fundamental questions like, “What’s the mix to make this work so that students can access us virtually and access us on campus? How many residence halls do we need? How many books are in the library?” “I would not want to be a college president today,” he said.
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THE LISTS See Michigan’s graduate business degree programs PAGES 28-29
Tuition by the numbers All but one of the state’s large public universities increased tuition between the 2020-2021 and 2021-2022 school years, ranging from zero percent for the University of Michigan-Flint to 4.17 percent for Oakland University for resident undergraduates. Many schools aimed to offset those hikes with increased financial aid for qualifying students. Here’s how a selection of universities have handled that: ` The University of Michigan-Ann Arbor approved a 1.4 percent in-state tuition increase and a 6.4 percent increase in financial aid for undergraduates on the Ann Arbor campus in 2021. Annual tuition for lower-division resident undergraduates at UM-Ann Arbor for 2021-2022 was $16,178. In both years, the increase in undergraduate financial aid at UM covered the entire cost of the tuition increase for in-state students receiving need-based aid, according to spokesman Rick Fitzgerald. “More than 9,000 in-state undergraduates receive institutional grant aid, including more than a quarter who attend tuition-free,” he said. The Go Blue Guarantee, launched in Ann Arbor in 2016 and now available at the Flint and Dearborn campuses, covers tuition costs for up to four years for in-state, full-time undergraduates with family incomes of $65,000 or less.
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“The university’s use of modest annual tuition increases, paired with larger increases in financial aid, has meant no net tuition increases for most in-state undergraduates for more than a decade,” Fitzgerald added. The board of regents will revisit tuition increases in June.
The ‘lost COVID class’ The state’s flagship universities have been grabbing in-state student market share for a decade — a trend that continued during the pandemic. Enrollment at the UM-Ann Arbor increased by 4.55 percent between fall 2019 and fall 2021. While Michigan State University and Michigan Tech held fairly steady, declining just a fraction of a percent each over two years and rebounding last year, all other state universities lost substantial enrollment. Central Michigan University experienced the worst decline, dropping 20.4 percent between fall 2019 and 2021. The Detroit News reported that CMU officials attributed the loss to a lack of recruitment efforts and being out-recruited by schools in metro Detroit. See COLLEGES on Page 10
` Meanwhile, UM-Dearborn lower-division students saw a 1.95 percent increase for 2021-2022, following a 1.86 percent increase in 2019-2022. Annual tuition for lower-division resident undergraduates at UM-Dearborn for 2021-2022 was $13,816. UM-Dearborn Vice-Chancellor for External Relations Ken Kettenbell said the school has taken actions to reduce or eliminate student fees, partly because of instruction’s remote or hybrid nature. Those reductions include reduced registration fees for parking, student organizations, and laboratory and web fees. The school has also used pandemic relief funds to augment financial aid; as of March 2022, it distributed more than $16 million in American Rescue Act, CARES, and Coronavirus Response and Relief Supplemental Appropriations Act funds. Additional measures at UM-Dearborn to cut costs included hiring freezes, leadership staff salary reductions, canceling of on-campus events, freezing travel and discretionary spending, tuition reimbursement for non-UM programs, and reducing expenditures on noncritical expenses.
The Diag at the University of Michigan. | UNIVERSITY OF MICHIGAN
Change in tuition and required fees for resident students, 2020-2021 Oakland University
4.6%
Northern Michigan University
4.1%
Wayne State University
3.8%
Lake Superior State University
3.6%
Eastern Michigan University
3.3%
Michigan Technological University
3.2%
Western Michigan University
3.2%
Saginaw Valley State University
2.9%
Ferris State University
2.7%
Michigan State University
2.7%
Grand Valley State University
2.4%
University of Michigan-Dearborn
2.0%
Central Michigan University
1.9%
University of Michigan University of Michigan-Flint
1.4% 0
SOURCE: MICHIGAN ASSOCIATION OF STATE UNIVERSITIES
Some events-related staff was laid off or reassigned to other duties, such as recruitment. “[These] cost-saving decisions, [made] early on during the pandemic helped to stabilize our budget,” Kettenbell said. ` Michigan State University kept tuition rates frozen for nearly four years, and students experienced no tuition raise through the 2020-21 academic year. But cost increases and unexpected expenses to keep students and employees healthy and safe during the pandemic drove a 2 percent increase in 2021. “It’s the first increase in five years,” MSU spokesperson Emily Guerrant said. She noted that MSU combined emergency grants through federal COVID-19 legislation with financial aid to help offset those costs for lower-income families. “Families with an annual income of less than $100,000 were not impacted by the tuition increase,” she said. Annual tuition for lower-division resident undergradu-
ates at MSU for 2021-2022 was $14,703. ` The Grand Valley State University board of trustees approved a tuition increase of 2.4 percent, bringing annual tuition for lower-division resident undergraduates for 20212022 to $13,560. GVSU also approved a $5.4 million increase in financial aid, an 8 percent increase over the previous year, and designated $2.25 million in institutional financial aid to support student hardship needs due to COVID-19. This COVID-19 support is now in its second year of a four-year commitment. Annual tuition for lower-division resident undergraduates at GVSU for 2021-2022 was $13,244. ` Central Michigan University froze tuition for the 2020-21 academic year. “In 2020, CMU recognized that many students and families were struggling with lost income and financial uncertainty due to the pandemic. In April 2020, we implemented several
programs to assist students with costs,” CMU university spokesman Ari Harris wrote in an email. Those included deferred payment options for fall tuition, fees, room and board, and an additional $4 million in need-based scholarships. CMU disbursed $11.9 million in need-based scholarships for the 2020-21 year; that number rose to $15.8 million 2021-2022. It also guaranteed on-campus employment for students who needed or wished to work while in school and offered tuition discounts for summer classes. But tuition at CMU is up by 1.85 percent for the 2021-2022 year. “Even with this increase, CMU offers one of the lowest undergraduate tuition rates among Michigan’s public universities,” Harris said. “Also, since CMU merit scholarships are tied to a percentage of tuition instead of a fixed dollar amount, many students experienced minimal impact when tuition rates increased. Roughly 85 percent of CMU students receive some type of institutional financial aid.” Annual tuition for lower-division resident undergraduates at CMU for 2021-2022 was $13,200. ` Wayne State University bumped tuition for first-year undergraduates by 3.83 percent for the 2021-2022 school year after freezing tuition for 2020-2021. Annual tuition for lower-division resident undergraduates at WSU for 2021-2022 was $14,043. “It was a priority for us to keep any increase to the lowest level possible while not jeopardizing academic and student resources and investment,” said Mark Kornbluh, Wayne State’s provost and senior vice president for academic affairs. “Also, there were significant increases in financial aid over this period.” Between 2020 through 2022, WSU increased its commitment to financial aid by $16.6 million dollars, an increase of 21 percent.
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Abbot Hall at Michigan State University. | MICHIGAN STATE
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Enrollment in Michigan’s public universities has declined for a decade, dropping 13.2 percent since 2011. Fewins-Bliss attributes the drop primarily to Michigan’s aging demographics, but he also sees a growing anti-higher education sentiment. “Somehow, we’ve gotten this sort of weird message to students that this isn’t a thing anymore. Don’t go to college. That’s not necessary. You’ll graduate with a million dollars in debt. You’ll never pay it off, and you actually don’t need it to get a good job,” he said. “And the data doesn’t say that; it says the opposite.” Enrollment in Michigan’s public institutions overall took a downward turn during the pandemic, dropping 6.24 percent between fall 2019, when 280,490 students enrolled, and fall 2021, when 262,985 students enrolled. “We’re calling them the ‘lost COVID class,’” Fewins-Bliss said. “They are certainly not enrolling in college like classes before them, and we can’t seem to find them in the workforce like you would expect if they weren’t enrolling in college. So, where are they? What are they doing?” Fewins-Bliss and colleagues representing universities, community colleges, and trade schools are lobbying for legislation that would use pandemic relief funds to invest in tracking these potential students down to recruit them for college. He said the problem is an ongoing challenge that, like many things, the pandemic made worse. “We’ve been seeing this in the data for years, but COVID has just exacerbated these equity issues. We know that about 52,000 fewer students are enrolled in college in Michigan than were before the pandemic.” Those numbers are working against the state of Michigan’s 60 by 30 strategy, which aims to have 60 percent of working-age Michiganders have a certificate or college degree by 2030. In 2020, just under 50 percent of Michigan residents had a postsecondary degree or certificate. Reaching the ‘lost COVID class’ will require “boots on the ground” in communities, Fewins-Bliss said, to reach students wherever they are, even if that means in their parents’ basement. “We’ve got to enter into communities and show them that the long-term pathway has to be through post-secondary education, because that’s what the data shows,” he said. Although enrollment decline is a consistent trend across the nation, it’s more pronounced in Michigan. The state lost 9.2 percent of its college enrollment amid the pandemic, second only to New Mexico at 9.3 percent. An area of focus for Fewins-Bliss is the 150,000 Michiganders who have partially completed their degree. “We’re calling it ‘comeback to complete’,” he said. “We need to get people in the pipeline who can finish quicker. [These] people ... have 60 credits or more, but don’t have a certificate or degree. So getting them back engaged in education, providing some financial aid to have them join the pipeline midway through so that we can produce completions sooner rather than four to six years that it takes a traditional student to finish.” Two existing programs are reaching these groups: the Michigan Futures for Frontliners program, which offers tuition assistance to front-line workers, and the Michigan Reconnect program, which targets tuition assistance to Michiganders older than 25.
Hurley
Rupert-Jones
Futures for Frontliners emphasizes high school completion and community college, while Michigan Reconnect focuses on completion of an associates degree or certificate program. According to the state data, 120,000 Michiganders applied for the Futures for Frontliners program, and nearly 16,000 enrolled in classes last year. In June, Gov. Gretchen Whitmer announced an additional $100 million investment in the program to reach 22,000 workers. And more than 91,000 Michigan residents had participated in the Michigan Reconnect program within a year of its February 2020 launch. Dan Hurley, CEO of the Michigan Association of State Universities, sees these two programs eventually paying off for the state’s four-year colleges. “They are starting to turn things around, and that may result in a wave of transfer students to the universities in another year or two,” he said.
‘A matter of preference’: In-person vs. remote For Oakland University senior Sarah Gudenau, the best thing to come out of the pandemic was remote classes. “Of all course formats, hybrid style is my favorite, and I did not have any of those prior to COVID — they’re definitely a good thing to come out of the pandemic,” she said. But she’s not a fan of 100 percent remote learning. “I feel like some elements are lost. I only had one non-pandemic semester of college, and a lot of my class discussion has been — and continues to be — through forums,” Gudenau said. “Those get old and aren’t the same as a class conversation.” The convenience factor of online learning is likely more attractive to upper-division students at MSU who started college in the traditional format, according to Mark Largent, associate provost for Undergraduate Education and dean of Undergraduate Studies at Michigan State University. “There is a much greater desire among those students for the flexibility that online classes had offered them,” he said. “And so we’re seeing even the students living close to campus want more of their courses offered online. And they tell us they want them offered because of the flexibility it gives them.” Despite a push for in-person classes from Wayne State University administration, Assistant Dean Kiantee Rupert-Jones said remote and hybrid classes would remain at the university’s Mike Ilitch School of Business due to student demand. “Our students are usually working full time or have family obligations. So they’re looking for flexibility and online and hybrid classes,” she said. “And so at the graduate level, that’s what we’re offering, because we’ll see an even greater decline in our enrollment if we don’t offer that type of flexibility.” The school saw a decline of 23 percent between fall 2020 semester and winter 2022. Hurley predicts the vast majority of the instruction at public universities across the state for fall 2022 will be in person. “There still will be a propor-
Year-over-year percent change in enrollment for Michigan public universities 0.5% 0 -0.5% -1.0% -1.5% -2.0% -2.5% -3.0%
-2.9% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Total student headcount for Michigan public universities 262,985
300,000 200,000 100,000 0
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
SOURCE: MICHIGAN ASSOCIATION OF STATE UNIVERSITIES
tion of hybrid learning or online learning, but I think that will be a matter of preference for both faculty and students from a flexibility and convenience standpoint, and not to the detriment of learning outcomes,” he said. At MSU, spokesperson Emily Guerrant sees a mix of instructional styles persisting into the future. “We learned throughout the pandemic that students value the flexibility of online and hybrid options,” she said. “They want to be on campus and have in-person experiences; but also appreciate the flexibility to have some classes online, in a mix with in-person options, and we will continue to provide those offerings while providing in-person learning for those who prefer that option.” Cathy Shakespeare, associate dean for teaching and learning at UM-Ann Arbor’s Ross Business School, said that while the loss of global travel opportunities negatively impacted students’ experiences, the switch to remote learning had benefits. “This experience of switching to virtual courses during the pandemic required students to learn a new way to collaborate remotely and in person to get projects and assignments completed,” she said. “We believe that our students are better prepared for the future of work in the business world, which is now increasingly being conducted in virtual environments.”
Rejecting the ‘learning loss’ narrative MSU’s Largent does not believe in the pandemic buzz-phrase “learning loss” — the term experts have frequently used to describe the loss of knowledge students may experience due to education disruption amid the pandemic. “It’s not like people during the pandemic went into a coma and learned nothing. They learned different things,” Largent said. “You talk about learning loss, but you never talk about learning gains.” According to Largent, MSU students learned independence and flexibility that they would not have had the pandemic not happened, such as learning how to use online and remote tools. And they took more credits — averaging one additional credit hour per semester during the pandemic. But Largent acknowledged that those gains are not evenly distributed across the student body. He’s especially concerned about the sophomores. “Sophomores are the class that got hit the hardest; they lost their prom, their high school graduation, getting to move on to campus their first year,” he said. “So we are seeing social phobias hit harder. They still hadn’t quite developed some of the tools they need to navigate adulthood, because they didn’t have that extra
support in the first year of living in the residence halls.” Largent noted that he’s seeing a “pretty marked” increase in the first-semester probation rates at MSU, which rose from 6 percent to 9 percent amid the pandemic. “It’s a very strong indicator of whether or not they’re going to persist and graduate,” Largent said. He’s also seeing fewer students engage in “help-seeking behaviors” like accessing office hours and tutoring, despite those resources being more available now than before the pandemic as they are offered both in-person and remotely. “One of our focuses this spring and for the incoming fall classes will be normalizing help-seeking behavior as a good thing, an expected thing, and a necessary thing for everybody. It’s kind of preventative care,” he said. “We believe that every student that comes to Michigan State can learn, thrive and graduate. And we believe that when students don’t learn, thrive, and graduate to some degree, that’s our responsibility.”
What’s next? Fewins-Bliss sees a potential rebound for Michigan’s regional institutions as international and out-of-state students return to UM-Ann Arbor and MSU as the pandemic recedes, potentially leading those institutions to admit fewer in-state students. “The question is, are the [regional] institutions going to right-size right now? And would they be ready to take an influx of more students should that opportunity come to them in the short term?” he said. “We’re hoping that they’ll be ready to take more students because that’s what we’re hoping for more students in all levels of post-secondary education.” Hurley is hopeful that the fall of 2022 will bring a new period of consistency in enrollment, even if at a lower level now than a decade ago. “We’re holding our own against the tide of very challenging demographics and the state, specifically a graying population and a diminishing high school pipeline,” Hurley said. “Let me just say there was some leakage in the dam going back about five years, and then the dam broke with the COVID pandemic. So I think the worst is behind us; this fall, we are entering a period of less turbulence, more predictability, sustainability, and planning.”
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Dechen recognized with Michigan 50 Companies to Watch Award Dechen Consulting Group (DCG) has been recognized as one of the 2022 awardees for the Michigan 50 Companies to Watch Award, presented by Michigan Celebrates Small Business (MCSB). DCG will be acknowledged on stage at the in-person awards ceremony during the 18th annual Michigan Celebrates Small Business Gala on May 3, 2022. Judges from economic and entrepreneurship development organizations annually select the winners based on, among many factors, intent and capacity to grow, exceptional entrepreneurial leadership, and sustainable competitive advantage. “MCSB has always prided itself on its spirit of collaboration and celebration,” said Jennifer Deamud, MCSB Board Chair. “We love seeing our awardees celebrating one another’s success and sharing in this amazing moment is each awardee’s journey. It’s true — success is best when it is shared.” DCG President Raj Dechen appreciates the recognition. “As a growing boutique IT consulting firm that has been serving clients for almost 25 years, we are honored to receive this award that recognizes our past performance and future potential,” said Raj Dechen. “We remain committed to serving clients with a range of IT solutions that encompass ERP Implementation, Application Development, Cloud Solutions, and Talent Acquisition.” DCG is headquartered in Farmington Hills, Michigan, with additional offices in Canada and India, and employs highly skilled consultants serving clients globally. “Client satisfaction is at the core of everything we do, and at DCG, we always aim to deliver above and beyond client expectations,” added Raj Dechen. the
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Recent graduates in high demand in today’s labor market BY NINA IGNACZAK | SPECIAL TO CRAIN'S DETROIT BUSINESS
Jeff Beavers has one word to describe the job and internship market faced by upper-division students and recent grads at Michigan State University: “Fierce.” “We are seeing a record number of job and internship postings from our employer partners seeking to hire Spartans,” Beavers, executive director of Michigan State University’s Career Services Network, said. In 2019, MSU received about 98,000 postings annually, Beavers said. The pandemic saw a slight increase to 101,000 in 2020. So far this year, MSU — for nine months ending March 31, it’s received 157,123 postings. According to a Federal Reserve Bank of New York analysis, while recent college grads saw a spike in unemployment in 2020 with the rest of the labor force, their employment rates have largely rebounded. “Many new employers are reaching out to us to hire our talent, ranging from school districts and health care providers to logistics companies and manufacturing firms,” he said. “In fact, we are averaging 685 new employers per month or almost 24 each day, which is nearly double our pre-pandemic numbers.” While that’s great news for students, it can also be overwhelming. “There’s a lot of competition for entry-level talent. So what is happening is that it’s also overwhelming the job seeker,” Beavers said. MSU’s employer relations team works with employers to find new ways to stand out. “We’re available to help employers with their recruiting strategy to provide best practices for attracting the early-career talent they seek. We help review job postings, share insights into best practices for candidate communications, and help them identify opportunities to increase their employer brand.” Virtual career fairs became the norm during the pandemic and will likely continue in the post-pandemic
era — MSU plans to continue holding 25 percent of its recruiting events remotely. Virtual career fairs allow for scheduled, one-on-one interactions between employers and candidates via videoconference. That benefits employers by limiting travel expenses and allowing employers without large HR or recruiting teams to participate. Virtual career fairs also afford greater access to nontraditional students, students with disabilities, student-athletes, and those who may reside off campus, are studying abroad, or working on a co-op assignment. Heather Byrne, managing director of the University of Michigan-Ann Arbor’s Career Development Office, said some recruiters have been creative in the virtual recruiting space. “Some have conducted fun activities like virtual chocolate tastings, escape rooms, wine tastings, and cooking classes,” she said. “These events have provided companies a way to engage students in an interactive way while doing something unique. The feedback from the students was very positive, and these events have left a great impression on the students.” But virtual career fairs have their shortcomings, according to Beavers. “Students tell us they find the in-person events to be more engaging and the interactions to be more authentic,” he said. “It’s shifted to almost a transactional recruitment process, which is much less relationship-based. And consequently, it’s really disadvantaging the students because they have fewer opportunities to have what I would consider authentic conversations with either an alum or recruiter.” That’s what University of Michigan sophomore Meera Kumar has experienced. She said she feels a “disconnect” when applying for jobs almost exclusively online. “It doesn’t really feel like there’s a person behind the screen a lot of the time. The interpersonal connections that are so important to career development, I’ve definitely missed out on those.”
For more information, please visit the DCG website at www.dcg-us.com or contact us at info@dcg-us.com or rdechen@dcg-us.com. Thank you.
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WITH DIGITAL REPRINTS, KEEPSAKES AND MORE Contact Laura Picariello at lpicariello@crain.com or (732) 723-0569 to learn more about commemorative options.
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INSIDE: Why Detroit is a case study in the challenges of defining ‘affordable’ housing. PAGE 26 ONLINE: Listen to ‘The Build Up’ podcast interview with Detroit developers Sonya Mays and Amin Irving.
AFFORDABLE HOUSING
CRAINSDETROIT.COM/PODCASTS
Kyle Slominski and Brandy Belcher view a Roseville home with their real estate agent. The couple has been renting a 750-square-foot house in Warren with their three dogs and three cats. | NIC ANTAYA FOR CRAIN’S
OUT OF REACH
Home affordability challenged for renters and buyers in metro Detroit BY ARIELLE KASS
Here’s how hard it is to buy a house these days: Kyle Slominski essentially lost out on the same place twice. Slominski, 28, has been renting a 750-square-foot house in Warren with his girlfriend, three dogs and three cats. It’s a small space for all of them, and the yard floods when it rains. On top of that, the landlord in January tried to raise the rent to $900 a month, from $745. Slominski talked him down to $825, but the fact remains: “It’s kind of forcing us into moving.” It’s a pattern becoming increasingly common in Michigan’s housing market. Higher rents push people to look for new homes and when they try to buy, multiple offers come in over list price, and over the budgets of those like Slominski — when they find something with-
in budget at all. It’s hard to find something affordable, especially for renters and first-time buyers, as supply remains low and demand stays high. But the problem of affordability is being exacerbated at every stage of the market, said Marc Norman, an associate professor of practice in the University of Michigan’s architecture and urban planning department. “We’re in crisis,” he said. “The crisis of affordability is ubiquitous no matter the income.” Insufficient new construction, zoning rules that limit where housing can go and what kind of structures can be built as well as wage growth that hasn’t kept pace with inflation have all combined to keep supply low and make it harder for people to find quality housing within their price range, Norman said. See AFFORDABILITY on Page 25
Michigan single unit housing permits Construction of new units is occurring at a much slower pace than normal. New housing construction remains about one-third of its peak in the early 2000s before the Great Recession and 47 percent of housing units were built before 1970. Total number of permits issued per year
40,000
30,000
20,000
10,000
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018
2020
Note: This data is based on permits for new single-family home construction. The 2021 totals are not final adjusted numbers. SOURCE: U.S. CENSUS BUREAU
CRAIN’S DETROIT BUSINESS GRAPHIC
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C
Use funds to secure affordable housing for all I cessities of housing, child f you’re a Michigander, care, food, transportation, we have all heard the health care, a smartphone phrase, “Fix the damn plan, and taxes (“cost burroads.” While I completely den”). This is among the agree with this mantra, highest of our neighboring minus the curse word, we states. What is even more have to ask ourselves why. frightening is that in MichiAnd it’s deeper than simgan, an additional 414,583 ply “potholes suck.” You’re households (over 10 percent) fixing the roads not only to Amin Irving is were on the cusp of dropping get to a certain destina- founder and below the cost burden tion, but to safely return to owner of threshold in 2019. Consea place called home. Ginosko quently, almost 50 percent of We should never forget Development Michigan families either that access to quality af- Co., which cannot afford the basic nefordable housing is just as prioritizes cessities of housing or are important — if not more affordable one crisis — a rent increase, important than — roads, housing as part an unexpected home repair, car insurance premiums, of new projects. or a public health disaster — and ongoing pandemic reaway from dropping below lief. I applaud Gov. Gretchen Whitmer, her administration, and the cost burden threshold. This matthe state Legislature for coming to- ters for families, but it can also impact gether and passing the single largest the Michigan economy as a whole: state investment in housing and Even a small drop in wages, hours community development totaling worked, or an unexpected medical $654 million last month. Now we emergency could destabilize a large must ensure that these funds are effi- number of households. In order for housing to be deemed ciently and expeditiously spent. According to the 2019 Asset Limit- affordable, costs including mortgage ed, Income Constrained, Employed or rent should not exceed 30 percent (ALICE) Report, of the 3,963,558 of the owners’ or renters’ income. In households in Michigan, 38 percent a recent analysis of Michigan’s 20 (1,506,152) could not afford basic ne- largest cities, 70 percent of those cit-
ies were unaffordable for renters. Detroit, Dearborn, Warren and Grand Rapids were deemed the least affordable where renters spent between 36 percent and 50 percent of their income on rent. Let’s forget about housing costs for a moment, and recognize that income levels have also been on the decline. From 2007 to 2019, the number of low-wage jobs nearly doubled, increasing by 90 percent during that period. This accounted for more than 1.2 million jobs in Michigan in 2019. Even with two earners working full time, it is commonplace for households to be at or below the cost burden threshold. The number of medium-wage jobs decreased by 8 percent and the number of high-wage jobs decreased by 20 percent during that same period. Michigan faces growing challenges in housing cost and availability that impacts communities all around the state. Tackling our housing shortage matters for economic reasons. Not only will housing investment benefit Michigan’s overall economy through new jobs and greater housing stability for residents, it will also help local businesses. Businesses of all sizes and geographic areas have made it clear that both housing costs
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The purpose of the Statewide Housing Plan is to set the stage for a coordinated, data-driven, outcome-oriented approach to housing to ensure that all Michiganders have a quality home that meets their needs. The plan is designed to rectify historical inequities in housing access and other housing challenges. This plan presents opportunities for organizations to partner on common goals, for Michigan residents to have greater access to information and assistance, and for resources to be applied more effectively. If the pandemic era has taught me anything, it has taught me that there are four fundamental needs of a human being: Hope, water, and shelter; and alTACKLING OUR HOUSING SHORTAGE food though there are many MATTERS FOR ECONOMIC REASONS. important challenges that need to be solved, complex barriers to safe, healthy, af- we should always make it a priority to fordable and accessible housing for protect the peace that comes with all Michiganders requires coordinat- safe, healthy, accessible, and afforded action and new approaches. The able housing for all. Michigan’s Stateonce-in-a-lifetime American Recov- wide Housing Plan, along with the ery Plan provides new resources to recently passed bipartisan suppleaddress the challenges Michigan fac- mental bill creating the single largest es with housing, generating new en- state investment in housing and ergy for action and I am thrilled that community development sends a the state will soon unveil its first clear message to all that affordable housing matters. Statewide Housing Plan. and the lack of available housing negatively impacts their ability to recruit and retain staff. This is a critical issue for the state that needs urgent attention. So what is the solution? It’s simple. State agencies, real estate developers, lenders and fund managers responsible for allocating precious housing resources must ensure that federal, state, local, and private funds impact the most families possible; and you can only do that if you prioritize projects that create or rehabilitate the greatest number of units per dollar while maintaining a certain design quality standard. The reality is that overcoming the
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JoyceFdn.org 22 | CRAIN’S DETROIT BUSINESS | APRIL 25, 2022
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AFFORDABLE HOUSING COMMENTARY
Find solutions to restore access to homeownership
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er dollars, our elected leadwas raised in a workers and policymakers ing-class Detroit neighshould be simultaneously borhood in which virtupragmatic and bold. ally all my neighbors were The degree to which homeowners. My grandparhomeownership has beents and my parents proudcome increasingly out of ly bought their first homes reach for Michigan workers among a thriving communimaking under $50,000 is ty of auto workers and pubtroublesome. The U.S. unlic servants. Our families Sonya Mays is der-built homes by as much built wealth while sharing in the president as 4 million units following the social benefits of home- and CEO of ownership, like lower crime Develop Detroit, the 2008 housing crisis. This rates and greater civic par- a real estate and enormous housing production shortfall, when comticipation. We had achieved housing bined with rising inflation, the American Dream. development has resulted in large jumps in Sadly, predatory lending company median home prices that are and job loss converged in the focused on the outpacing worker income Great (Housing) Recession revitalization of growth. While this is good and many families lost their Detroit news for existing homeownhomes and were forced to neighborhoods. ers, who benefit from inrent. As the neighborhood recovered, stagnant incomes and creasing home equity, it is terrible mortgage scarcity left homeownership news for Michigan’s working renters, who each day become less likely to out of reach for many. Following the allocation of nearly own a home; therefore remaining stag$7 billion in federal COVID funds, the nant on the path to financial stability. This is not just an individual probstate of Michigan has a once-in-a-generation opportunity to make big, bal- lem — it also has grave implications anced investments toward tackling at a community level. Workers makMichigan’s entrenched economic and ing $50,000 or less are not only the social challenges, while offsetting foundation of the American workdamage done by the global pandemic. force, but are instrumental in buildIn deploying these single-use taxpay- ing stable communities. These are
our food service, transportation and retail workers, along with day care providers, health care aides, civil servants and our entry-level teachers and public safety professionals. Post-pandemic, it is impractical to argue against the importance of these workers to our communities. They wake up every morning, work full days, and often overtime, performing tasks essential to our quality of life, and yet many will never be able to own a home within the communities in which they serve. This status quo runs contrary to what we champion as the American Dream and further cements generational wealth inequality. We can fix this. We now have the resources to effectively tackle this issue and should do so by investing in innovative solutions that promote affordable homeownership. In crafting solutions, our policy makers should focus on both the production and consumption sides of the problem. We must simultaneously incentivize the creation of new affordable for-sale homes, while helping to bridge the financial home-buying gap that working families experience. New housing production is relatively straightforward — housing producers should be encouraged to build more
be established for business owners, where in exchange for state tax benefits, the employer funds first-time home purchase savings accounts for their moderate-income employees. The ceiling on these accounts could be matched to the gap between what the workers’ salary affords and the median cost of a home in their multi-county region. Policymakers could also consider incentivizing public agencies to create forgivable homeownership grant programs for public-sector workers. For example, a public school district could create a grant benefit for entry-level teachers, where in exchange for working for a set number of years, a forgivable grant be available for MICHIGAN CAN DEMONSTRATE TO THE would use as a down payCOUNTRY WE HAVE THE ANSWERS. ment on a home within that school district. Homeownership has long been a more cost-effective construction methods or with programs that inten- defining feature of American society, tionally grow the ranks of skilled con- but many of our workers are now left out for reasons not of their making. struction professionals. Buyer-side intervention options Michigan can be bold in fixing this are even more plentiful. Policymak- and demonstrate to the country we ers should explore the creation of have the answers to reversing homehomeownership savings accounts for ownership decline. Let’s not miss working families. For example, con- this moment to restore access to ceptually similar to a health savings homeownership and the American account, a tax credit program could Dream. entry-level housing affordable to those making under $50,000. The state legislature recently took a step in this direction by including developer subsidy funding for “missing middle income” housing, but the scope of the funded program is fairly limited. Other ideas include advocating for the expansion of the existing, bipartisan federal Low Income Housing Tax Credit Program to allow for-sale homebuilding and the creation of a mixed-income cooperative housing subsidy. Construction costs and construction labor shortages are a growing drag on housing production, so policy makers would be wise to pair any developer incentives with ones that encourage
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Michigan physician leaders embark on path to health equity Theodore Jones, MD, Chair of the Michigan State Medical Society Task Force to Advance Health Equity Beyond its inherent tragedy, the COVID-19 pandemic has brought some uncomfortable and unfortunate truths about our health care system into the foreground. Namely, that it’s unfair. “The COVID-19 pandemic has served as a stark reminder that health inequities absolutely persist within our health care system, with people of color bearing a disproportionate burden of cases and deaths throughout this pandemic,” said Theodore Jones, MD, a Dearborn-based obstetrician-gynecologist and chair of the Michigan State Medical Society (MSMS) Task Force to Advance Health Equity. Thankfully, understanding why these sorts of inequities endure and subsequently working to eliminate them is an undertaking the Michigan State Medical Society is committed to and now prepared to begin in earnest thanks in part to a $200,000 grant from the W.K Kellogg Foundation. “Working to eliminate the inherent structural and systemic racism baked into our health care system is a priority for MSMS, and this grant from the W.K. Kellogg Foundation will go a long way towards getting us there,” added Jones.
The grant will be used to kickstart MSMS’s Partnering to Advance Health Equity project, a new undertaking designed to identify strategies and opportunities to better position and support physician leadership in its ongoing efforts to reduce — and ultimately eliminate — the racial and ethnic health disparities that persist throughout Michigan communities. That effort starts with a lot of listening and learning on behalf of Michigan’s physician leaders. Working to advance health equity in communities across the state will naturally begin with engaging physicians and other community stakeholders around the state to better understand the types of support physicians need to lead change in their respective communities via care delivery. To that end, MSMS plans to survey Michigan physicians as well as convene stakeholder meetings that will provide opportunities to share experience, listen to local concerns and needs, and identity partners interested in mitigating health care gaps, disparities and inequities. Beyond that direct engagement in communities throughout Michigan, there will also be a research component tied to the initiative. As part of the Partnering to Advance Health Equity project, MSMS will also spend time and resources learning
about replicable initiatives from other professional organizations as well as work with the American Medical Association to implement evidence-based health disparity-conscious best practices in Michigan. “Thanks to this grant from WKKF, MSMS and physician leaders across the state are ultimately going to be in a much better position to make sure organized medicine is responsive to community needs, rebuilds trust, and provides leadership in all communities throughout Michigan, provid-
ing every patient with the opportunity achieve optimal health,” said Julie Novak, MSMS CEO. “That’s certainly something worth celebrating and we’re excited to get started.” For more information, visit MSMS.org
APRIL 25, 2022 | CRAIN’S DETROIT BUSINESS | 23
AFFORDABLE HOUSING
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COMMENTARY
From
Use stimulus to counter destructive policies B founded in 1993 and has y one estimate, nearly since invested more than 62 percent of Detroi$550 million in affordable ters pay more than 30 housing in Detroit. percent of their monthly inDesignated by the U.S. come for housing costs. Department of the Treasury Although Detroit’s averas a nonprofit Community age monthly rent is well beDevelopment Financial Inlow the national average, stitution, Cinnaire invests in the median household incommunities often overcome is less than half the Lucius Vassar is looked by traditional banks. national average. corporate We are guided by an unwavHousing and associated counsel and ering belief that all people costs have consistently executive vice deserve the opportunities grown faster than income president of provided by living in healthy for far too many Detroiters, equitable communities. leaving many critically over- engagement for We recognize the history burdened in their effort to Cinnaire. of government actions that maintain safe and affordreinforced neighborhood able housing. The current condition clearly didn’t segregation and provided government subsidies for home ownership happen overnight. Systemic inequities, manifested in and wealth creation to some citizens, today’s racial wealth gap and myriad while preventing that access to others government policies at the local, state based on their race. Understanding this history is the and federal levels, have contributed to first step toward addressing it. the critical challenges we face today. Author Richard Rothstein’s 2017 The global pandemic continues to impact the ability for Detroiters to af- book “The Color of Law: A Forgotten History of How Our Government Segford housing. Our organization, Cinnaire, was regated America” provides a critical
analysis of the how past government policies are responsible for much of what we see in today’s Detroit. Informed by this past, we can all work together to support and promote government policies that can address today’s challenges. CDFIs provide financing, equity investments, co-development partnerships and small-business support to spur neighborhood development in Detroit. The Low-Income Housing Tax Credit is the primary tool Cinnaire has used to create more than 6,000 units of affordable rental housing in the city. We are also working with partners to create homeownership opportunities for low to moderate income families in single-family homes that we created through LIHTC investment. The work we’ve advanced over the past 30 years has not been done alone. Detroit has a powerful network of neighborhood-based community development organizations engaging in this important work throughout the city. I am honored to serve with these organizations on the Board of Com-
munity Development Advocates of Detroit. Detroit is also fortunate to have many other local, regional, and national CDFIs that support community development and small businesses. Recently, the informal group of CDFIs came together and formed the Detroit CDFI Coalition as a nonprofit organization focused on collaborative strategies to advance community development in the city. I encourage you to visit detroitcdficoalition.org to learn more about the ways we are collaborating to have real impact in Detroit. In 2022, we are in a rare period of opportunity to provide relief to the many Detroiters seeking safe and affordable housing. The federal government has created new resources focused on economic recovery from the pandemic. The current city administration has instituted an affordable housing preservation strategy and CDFIs have stepped up to help preserve 10,000 units of naturally occurring and subsidized affordable housing. Detroit City Council also passed
an inclusionary housing ordinance to ensure that developments receiving public support will provide housing for a range of income levels. Lowto moderate-income families can expect quality and desirable neighborhoods because of these programs. In Michigan’s current budget deliberations, Cinnaire and members of the Detroit CDFI Coalition have joined with CDFIs from around the state to advocate for policy in the state of Michigan to provide resources to support community development, including affordable housing and small businesses. The proposed Michigan CDFI Fund seeks to direct up to $150 million of American Rescue Plan Act funds to leverage our existing resources to drive local recovery from the pandemic. We are hopeful that the Michigan Legislature will seize this rare opportunity to provide resources to this group of institutions who have a proven history of supporting critically needed affordable housing and neighborhood development in Michigan.
COMMENTARY
Senators: Legislature must deliver on housing H ousing stability impacts all of us — working families seeking affordable homes, local employers looking to recruit new talent, and Michigan communities trying to maintain strong and safe neighborhoods. But more than half of Michigan households, or nearly 2.1 million families, cannot afford a home priced above $250,000. This affects all regions of Michigan: from the northern Lower Peninsula — which needs more than 15,000 units — up to the tip of the Upper Peninsula, down to Kent and Ottawa counties in West Michigan — seeking more than 37,000 additional units — and back across to Southeast Michigan, where Detroit and its inner-ring suburbs are in dire need of housing renewal. Unfortunately, it is estimated that fewer than 20,000 single-family homes will be built this year and that there will not be enough rental and other types of units constructed to meet the need for affordable housing. And, when those who cannot find housing in their desirable price range are forced to look elsewhere for something less costly, bidding wars drive up the value of units within the desired range.
Sen. Jeremy Moss, D-Southfield, represents the 11th Senate District in southern Oakland County. Sen. Wayne Schmidt, R-Traverse City, represents the 37th Senate District, which includes the northern Michigan counties of Antrim, Charlevoix, Cheboygan, Chippewa, Emmet, Grand Traverse, Luce and Mackinac.
This effect snowballs, and eventually those Michigan households with the least resources are left with no acceptable options. After a hard day’s work, every Michigander should be able to return to a safe place that they can call home. In addition to the personal and family benefits of having a secured living space, adequate housing is an economic and community development asset that provides quality of life to residents and fosters healthier communities. It also has far-reaching effects like boosting student achievement, increasing access to employment, improving equitable outcomes and more. The creation of more housing opportunities at all price points is essential to supporting the expansion and attraction of better-paying jobs
Construction continues in the Oak Grove Meadows subdivision in Livingston County just north of Howell last November. Most of the nearby homes have already been sold. | DALE G YOUNG FOR CRAIN’S DETROIT BUSINESS
joined the Housing Michigan Coalition. This group of community, business and government organizations is focused on increasing housing supply and affordability, including “workforce housing” — priced between 60 percent AFTER A HARD DAY’S WORK, 120 percent of area meEVERY MICHIGANDER SHOULD BE and dian income — through loABLE TO RETURN TO A SAFE PLACE cally controlled and flexible tools. THAT THEY CAN CALL HOME. Our bipartisan package of bills amplifies existing proant returns on investment for the grams or incentives, like the Neighstate’s economic health in the pro- borhood Enterprise Zone Act or payment in lieu of taxes (PILOT), and cess. This is an important issue for all creates new programs, such as the Michigan communities and it’s why Attainable Housing Facilities Act, to we, along with a number of our col- provide local governments with a leagues from both sides of the aisle, toolbox to incentivize the creation in Michigan. Workforce housing is one strategy that can be harnessed to strengthen the relationship between businesses and their employees in a meaningful way, and that can also yield import-
and retention of attainable housing. This will make it easier for builders to partner with communities to provide housing to meet local needs, giving residents the security that comes with having a dignified place to live. We agree: our housing crisis is big. It’s complicated. It will be solved one step at a time, but we must make progress because Michigan residents deserve affordable housing options and secure places to live. The legislation we introduced promotes essential and innovative programs that address the area of greatest need and provide the adaptability local governments and businesses seek. We urge our colleagues to join us in prioritizing these housing solutions.
24 | CRAIN’S DETROIT BUSINESS | APRIL 25, 2022
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AFFORDABLE HOUSING
AFFORDABILITY
From Page 21
The average sales price of a home in Michigan rose 84 percent between January 2013 and October 2021, according to data from the Michigan State Housing Development Authority, while prices continued their upward trajectory in recent months. At the same time, rents rose 20 percent on average, MSHDA said, with mid-market properties that are most likely to have affordable units seeing the biggest bumps. Before the pandemic, almost half of renters and nearly one in five homeowners spent more than 30 percent of their salary on housing, MSHDA said, a figure that is considered to be a major barrier to housing stability. Those figures worsened over the course of the pandemic. “Not having that housing stability can negatively impact nearly every other aspect of your life — from your ability to get or keep employment to receiving an education to putting food on your table,” Gary Heidel, MSHDA’s acting executive director, said in an emailed statement. “Affordable housing is an essential part of enabling other aspects of our health, well-being, and success.”
Evaluating options The macroeconomic issues are hard to fix, Norman said, but higher wages and more flexible zoning could decrease the financial burdens and allow more housing options in the metro area. Other suggested solutions abound. The state land bank has been advocating the use of an economic development tool, tax increment financing, to recoup some costs for affordable housing projects. Bob Filka, CEO of the Home Builders Association of Michigan, said a bipartisan group of legislators has put forward a slate of bills that could incentivize new home construction in areas where it’s needed. The Housing Michigan Coalition is in favor of about a dozen proposals, half of which have passed the state Senate and are due to be taken up by the state House. The bills would create what would be known as attainable housing districts, exempt workforce housing from property taxes, allow tax credits for contributions to a certified housing impact trust fund and expand neighborhood enterprise zones, among other changes. Filka said the proposals are geared toward the “missing middle,” and would help push for development in areas where there aren’t enough homes. But all of the proposals would negatively impact the state’s bottom line, something Jennifer Smith said should be a nonstarter. Smith is the director of government relations for the Michigan Association of School Boards, and she said any proposal that prioritizes housing over schools doesn’t understand how people think about where they live. “We acknowledge there’s an issue, but people also locate for the schools,” she said. Measures that reduce property taxes that go toward education and municipal services will make places less desirable communities, she said. Smith said her group opposes the package, and suggested federal coro-
Brandy Belcher of Warren, left, and her boyfriend, Kyle Slominski of Warren, check out the backyard of a home for sale in Roseville. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS
Homeownership rates
Unaffordable housing
Homeownership and homelessness show significant disparities along racial lines. In 2019, Black residents made up 14 percent of the state’s overall population, but accounted for 52 percent of the homeless population.
Between January ’13 and October ’21
White: 78%
Average sale price for a home increased 84%
Average asking rent increased 20%
Hispanic/Latino: 56% Black: 43% Asian: 61% American Indian/Alaska Native: 61% SOURCE: MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY DATA
navirus relief money might be a better source of funding. “There must be other ways,” she said. “We urged them not to put this on the backs of property taxes.” MSHDA will next month unveil its first statewide housing plan, and Heidel said in his statement that more than $650 million has been earmarked for housing programs, including more than $400 million to keep renters and homeowners from being displaced because of pandemic-related hardships, $50 million to help fill affordable housing financing gaps and $50 million to defray costs for nonprofit developers.
‘Smoke and mirrors’ It’s a particularly difficult time to be in the market for a home, said Andy Elder, a loan originator at 1st Securities in Bingham Farms. As interest rates rise, mortgages become more expensive, diminishing buying power. He said a lot of potential buyers are simply giving up. Even firsttime buyers who are seeing their rents continue to rise aren’t necessarily able to get out of that cycle by buying. “It’s like trying to catch a falling knife,” he said of the home-buying
SOURCE: MICHIGAN STATE HOUSING DEVELOPMENT AUTHORITY DATA
process. “Sometimes, not doing anything is the best strategy.” Slominski brings in about $60,000 a year working as a machinist, doing some DJing, fixing cars and working occasionally as a stagehand on the side. He has about $7,000 set aside for a down payment, and plans to use state down payment assistance and a federal mortgage program to cover some of the costs of a new home. Slominski, who spent time re-upping his credit score after a previous bankruptcy, has been approved for a mortgage of up to $135,000, but is looking in the $125,000 range. He’s already made six offers, including one on a three-bedroom Eastpointe house that came back on the market before he could make a decision on a same-day offer in late March. The house was available again two weeks later, but he lost it that time, too. “My money’s never been green enough,” said Slominski, who estimates he’s looked at more than 40 houses. “You’ve got to eat your lumps and keep going.” His girlfriend, 24-year-old Brandy Belcher, hasn’t established credit yet, keeping them from being approved for more. The pair said since
they started looking, they’ve continually had to prepare for disappointment. On more than one occasion, they’ve looked at a house in the morning, only to find that it’s off the market by the time they get off work later that day. “On my end, it’s really frustrating,” said Ryan Kain, a Realtor with RE/ MAX Leading Edge who’s helping the couple. “It’s slim pickings at this price point. There’s a lot of grungy houses.” A recent report from the National Association of Realtors showed that a lack of affordable homes was the No. 1 obstacle for buyers nationwide. But, compared to the rest of the country, metro Detroit is still considered affordable, Executive Vice President of Market Intelligence for Attom Rick Sharga said. The latest data shows home prices were up 9.4 percent over March 2021, according to the multiple listing service Realcomp. Only two counties in the state — Livingston and Ottawa — were “marginally unaffordable,” according to Attom’s analysis. But he said wage increases haven’t kept pace with home prices, and “affordability across the country isn’t as strong as it was a year ago.”
That’s led some remote workers to look in places like Boise, he said, driving prices up in those cities — something that’s “entirely possible” in metro Detroit, where the median sales price is $229,700, according to Realcomp. “It’s all relative,” he said. “Every individual’s level of affordability is going to be different.” Rental units that are deemed “affordable” are done so based on Area Median Income, a federal designation that is problematic because it factors in higher suburban incomes, which skew the figure upward. For example, units in Detroit are considered affordable at 80 percent of AMI. However, 80 percent of AMI for a two-person household is $51,200, while a four-person household is $64,000. A studio apartment that rents at 80 percent of AMI is $1,120, while a one-bedroom is $1,200, a two-bedroom is $1,440 and a three-bedroom is $1,664. And rents, even at those levels, are simply out of reach for many Detroit households. Heidel, with MSHDA, suggested there should be a focus on new units that are affordable to those who make less than 60 percent of the Area Median Income. Norman, with the University of Michigan, said it’s true that Detroit home prices are lower than other places. But when the total cost of housing is factored in, including access to education, city services and parks and the cost of taxes and insurance, the math isn’t always as clear. And because wages in the city are low — the median income in the city is $32,498, according to Census data, and a third of residents live in poverty — “Detroit is unaffordable for many of its residents.” “All of a sudden, it doesn’t look that affordable,” Norman said. “The quality of housing is not acceptable to a lot of people. Is there working heat? Lead pipes? Affordability is a little bit smoke and mirrors.” See AFFORDABILITY on Page 26 APRIL 25, 2022 | CRAIN’S DETROIT BUSINESS | 25
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AFFORDABILITY
From Page 25
The American Dream Across metro Detroit, the definition of what would be considered affordable housing varies. In Ann Arbor, the need is primarily for more multifamily housing, like apartments, townhouses and condos, said Margaret Dewar, a professor emerita of urban and regional planning in the University of Michigan’s Taubman College of Architecture and Urban Planning. Dewar said zoning restrictions are often a problem, as many communities don’t want more dense development that can be less expensive to build. Especially in areas where single-family home values are high, she said, there’s a lot of not-in-my-backyard reactions to higher-density proposals that keep projects from moving forward. What that means, she said, is that many people who work in places like Ann Arbor can’t afford to live there. It adds to commute times and means communities are more likely to be homogeneous — both things that are “not so great for society,” she said. The data from MSHDA supports this. Homeownership, and homelessness, show significant disparities along racial lines. In 2019, 78 percent of white residents owned their own homes, compared to 43 percent of Black residents, 56 percent of Hispanic/Latinos, 61 percent of Asians and 61 percent of American Indians/Alaska Natives. While Black people make up just 14 percent of Michigan’s overall population, they account for 52 percent of the state’s homeless population, MSHDA says.
It also means that plenty of people spend more than 30 percent of their salary on their homes, making them cost burdened and keeping them from other spending. Norman said people will forgo health care, car repairs and other necessities to be able to pay for housing costs; they double up with friends or family members to save money; and they may eventually be forced into insecure or unsafe conditions, like extended stay motels or sleeping in vehicles. Expanding access to federal housing vouchers and tax-credit programs that target low-income individuals as rents are soaring would go a long way to solving the problem, said Douglas Marcum, the past-president of the Detroit Metropolitan Apartment Association and a regional property manager for KMG Prestige. Heidel, with MSHDA, also said having more landlords participate in the Section 8 Housing Choice Voucher program would make it easier for more people to find suitable housing. Marcum said his group regularly lobbies for additional tax-credit housing; he said wait lists for units have gone from 30 to 60 days to six months. In the meantime, he said, residents are “just having to make ends meet.” “We have forgotten about those people in the middle,” he said. “We need more product in order to fulfill the demand.” That’s true, too, for single-family homes. Forrest Wall, the CEO of the Home Builders Association of Southeastern Michigan, said the state has been under-building for years. “We’re at a point where what we normally consider entry-level homes, there’s very little supply in the market,” Wall said.
There are a number of reasons for that, including higher materials prices and a dearth of builders. Adding more skilled workers is one of his organization’s highest priorities, Wall said. Existing housing stock is also aging, with nearly half of all units in Michigan built before 1970, MSHDA said. Filka, with the state Home Builders Association, said he’s taken to calling affordable housing “Attainable housing,” so people will think more broadly about what affordability entails. He, too, said increasing density is one of the most important things communities can do to reduce costs. He also hopes that with demand softening for high-end homes, more builders will shift their focus to other parts of the market. The crisis has been building for more than 15 years, Filka said, as building has been concentrated on the higher end and the number of new homes has stayed lower than it should be in a healthy market. And he said it’s gotten worse in recent years, as the price of a new home nearly doubled because materials and labor costs rose during the pandemic. To be economically strong and healthy, he said, the state’s housing stock issues have to improve. “It’s an immensely important issue,” he said. “There is no easy answer for solving our housing crisis.” But there are consequences to not solving it. “Unfortunately, realizing the American Dream is becoming very, very difficult,” Filka said. “It’s appeared to always be an achievable dream for the average Michigander. That dream is fading away.” Contact: arielle.kass@crain.com; (313) 446-6774; @ArielleKassCDB
W e l o o k b e yo n d th e listi ng
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GETTY IMAGES
AFFORDABLE HOUSING
Detroit is a case study in housing challenges BY KIRK PINHO
Perhaps nowhere is the affordable housing crisis more pronounced than in Detroit. In a city of — depending on whether you believe the most recent U.S. Census numbers — 639,111 residents or more with a median household income of just $32,500, ensuring all of those residents have access to quality housing they can afford has been front and center of policy debates for years. But a series of competing factors is making an already complicated matter like affordable housing in the city even more so. “The need for affordable housing, it’s crazy,” said Clifford Brown, a Detroit mixed-use multifamily developer who runs Woodborn Partners LLC. Couple increasing construction costs — a combination of rising materials like lumber and other things, plus labor costs — with broader lack of income growth citywide and you get a recipe for a dicey predicament for developers and residents alike. The more it costs to build, the more rent has to be collected for developers to make a profit. If those profits can’t be achieved, new housing doesn’t get financed, built or renovated. That also constricts supply, and pushes rent prices upwards. And in some cases, more public subsidies are needed to fill the financing gaps created by rising construction costs. In all, those factors combine to make an unstable market. “Until we drive income growth, and until we find a way to control costs of construction, I don’t know how we have a real substantial conversation on keeping housing affordable, because those are the primary drivers,” Brown said. Generally, households are recommended to spend no more than 30 percent of their income on housing costs, including rent and utilities. So a household earning the Detroit median should, in theory, spend no more than about $800 on rent — which is not even factoring in the difference between gross and net pay. But even studio apartments that meet the technical definition of “affordable” rent for north of $1,000. That’s because what is considered “affordable” is determined by the Area Median Income, which factors in higher suburban Detroit incomes and therefore skews that figure upward. Therefore a unit that is technically considered affordable at 80 percent of the federally-established AMI may not be affordable at all for a large swath of Detroit’s population. Eighty percent of AMI for a two-person household is $51,200,
while a four-person household is $64,000; a studio apartment at 80 percent of AMI is $1,120, while a one-bedroom is $1,200, a two-bedroom is $1,440 and a three-bedroom is $1,664. “True affordability for Detroiters is at 50 percent of AMI or below,” said Glenn Wilson, president and CEO of Flint-based Communities First Inc., which has affordable housing development efforts in Detroit. “Because construction prices are rising and also developers are trying to get more income, what they are doing is more 80 percent, which is on the higher end. Eighty percent AMI is not truly affordable.” Although there have been efforts at something described as a “local” AMI specifically for Detroit, adopting such a model could create ripple effects on at least some forms of federal housing funding. Julie Schneider, director of Detroit’s Housing and Revitalization Department, said increasing construction costs have been one of the reasons the Michigan State Housing Development Authority put out calls saying that projects that had already received low-income housing tax credits in 2019 could receive additional credits. “It’s a statewide issue,” she said. “We are seeing things we thought were fully funded, no longer fully funded.” Some Detroit projects have had to receive additional local subsidies because of the increase in costs, Schneider said. But the money the city has to work with for funding those projects generally hasn’t increased, regardless of a large federal windfall in the form of $826.7 million Detroit got from President Joe Biden’s administration’s American Rescue Plan Act. “My pots aren’t getting bigger,” Schneider said. The city says there are 1,384 units of affordable housing built since 2015, with 30 percent affordable at 80 percent of AMI, 41 percent affordable at 60 percent of AMI, 14 percent affordable at 50 percent of AMI and 15 percent affordable at 15 percent of AMI. There have been 6,464 units preserved: 4 percent affordable at 80 percent of AMI, 25 percent affordable at 60 percent of AMI, 41 percent affordable at 50 percent of AMI and 30 percent of them affordable at 30 percent of AMI. According to the city, there are another 3,403 units in the process of being preserved, and another 1,055 units in the development pipeline. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCD
26 | CRAIN’S DETROIT BUSINESS | APRIL 25, 2022
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CRAIN'S LIST | STAFFING-SERVICE COMPANIES Ranked by 2021 revenue COMPANY ADDRESS PHONE; WEBSITE
TOP LOCAL EXECUTIVE(S)
REVENUE ($000,000) 2021
REVENUE ($000,000) 2020
AVERAGE DAILY EMPLOYMENT 2021
ANNUAL PAYROLL 2021
NO. OF W-2 FORMS ISSUED 2021
NO. OF OFFICES IN METRO DETROIT 2021
1
KELLY SERVICES INC.
Peter Quigley president, CEO & director
$4,909.7
$4,516.0
NA
NA
NA
NA
2
ACRO SERVICE CORP.
Ron Shahani president & CEO
$465.3
$446.5
2,630
$90.0
5,168
2
3
TATA TECHNOLOGIES INC.
Warren Harris CEO and managing director
$384.0 e
$365.2 e
NA
NA
NA
NA
4
STRATEGIC STAFFING SOLUTIONS INC.
Cindy Pasky founder, president and CEO
$365.5 e
$347.6 e
NA
NA
NA
NA
5
STEFANINI INC.
Spencer Gracias CEO
$325.0
$296.0
1,550
$98.9
2,603
1
6
EPITEC INC.
Josie Sheppard president Jerome Sheppard CEO
$168.6
$131.6
1,700
$131.0
3,140
1
7
TECHNOSOFT CORP. (DBA APEXON) 1
Sriniketh Chakravarthi CEO 2 Radhakrishnan Gurusamy founder, Apexon
$158.4 e
$150.7 e
NA
NA
NA
NA
8
ARROW STRATEGIES LLC
Jeffrey Styers CEO
$80.2
$59.0
912
$49.2
1,874
1
9
THE DAKO GROUP
Jason Copley managing director
$77.2
$76.0
880
$58.7
1,340
1
10
RAPID GLOBAL BUSINESS SOLUTIONS INC. (RGBSI)
Nanua Singh chairman and CEO
$64.1
$65.3
NA
NA
NA
NA
11
RELIABLE SOFTWARE RESOURCES INC.
Ravi Vallem CEO Venkat Gone president
$63.4 e
$60.3 e
NA
NA
NA
NA
12
W3R CONSULTING
Eric Hardy president and CEO
$49.4
$47.9
325
$15.7
462
1
13
KYYBA INC.
Thiru Ganesan president and CEO
$48.7
$40.0
458
$35.8
825
1
14
STAFFWORKS GROUP
L. William Brann III chairman Jason Brann COO
$46.8
$35.0
NA
NA
14,000
4
15
ICR SERVICES
Paul Gutierrez president and founder
$42.2 e
$40.2 e
NA
NA
NA
NA
16
MALACE & ASSOCIATES INC.
Larry Malace II CEO
$41.3
$33.7
1,180
$3.0
2,970
3
17
AUTOMOTIVE QUALITY & LOGISTICS INC.
Sangeeta Ahluwalia CEO
$36.2
$35.5
502
$12.5
1,628
6
18
BLUE CHIP TALENT
Nicole Pawczuk CEO
$31.5
$24.3
250
$17.1
290
1
19
CONTRACT PROFESSIONALS INC. (CPI)
Steven York chairman and CEO
$26.8
$26.8
400
$23.0
750
1
20
DRIVERSOURCE INC.
David Olshansky co-owner and COO Jinan Dalloo co-owner and CEO
$16.1
$12.5
NA
NA
NA
NA
21
PRODUCTION MODELING CORP.
Onur Ulgen owner and president
$15.0
NA
NA
NA
NA
22
NOVA CONSULTANTS INC.
Sunil Agrawal president
$9.8 e
$9.4 e
NA
NA
NA
NA
23
ETCS INC.
Ravi Kapur president and CEO
$4.8 e
$4.6 e
NA
NA
NA
NA
24
NUTECHS LLC
Craig Valassis CEO and owner
$4.6 e
$4.4 e
NA
NA
NA
NA
25
TRILLIUM TEAMOLOGIES INC.
Susanne Rodzos controller & COO Greg Stanalajczo vice president and CMO
$2.9
$2.7
28
NA
NA
1
999 W. Big Beaver Rd., Troy 48084 248-362-4444; kellyservices.com 39209 W. Six Mile Road, Suite 250, Livonia 48152 734-591-1100; acrocorp.com 41050 West 11 Mile Road, Novi 48375 248-426-1482; tatatechnologies.com 645 Griswold St., Suite 2900, Detroit 48226 313-596-6900; strategicstaff.com 27100 W. 11 Mile Road, Southfield 48034 248-357-2866; stefanini.com 24800 Denso Drive, Suite 150, Southfield 48033 248-353-6800; epitec.com
One Towne Square, 6th Floor, Southfield 48076 248-603-2600; apexon.com
27777 Franklin Road, Suite 1200, Southfield 48034 248-502-2500; arrowstrategies.com 2966 Industrial Row Drive, Troy 48084 248-655-0100; dakogroup.com 1200 Stephenson Highway, Troy 48083 248-589-1135; rgbsi.com
22260 Haggerty Road #285, Northville 48167 248-504-6869; rsrit.com
1000 Town Center, Suite 1150, Southfield 48075 248-358-1002; w3r.com 28230 Orchard Lake Road, Suite 130, Farmington Hills 48334 248-813-9665; kyyba.com 1700 Harmon Road Suite 2, Auburn Hills 48326 248-416-1090; staffworksgroup.com
28601 Lorna Ave., Warren 48092 586-582-1500; icrservices.com 5700 Crooks Road, Suite 112, Troy 48098 248-720-2500; malacehr.com 14744 Jib St., Plymouth 48170 734-459-1670; aql-inc.com
43252 Woodward Ave., Suite 240, Bloomfield Hills 48302 248-858-7701; bctalent.com 4141 W. Walton Blvd., Waterford 48329 248-673-3800; cpijobs.com
22420 Telegraph Rd. , Southfield 48033 800-887-9095; driversource.net
15726 Michigan Ave., Dearborn 48126 313-441-4460; pmcorp.com
21580 Novi Road, Suite 300, Novi 48375 248-347-3512; novaconsultants.com 21275 Mullins Ave, Warren 48089 248-763-9467; etcsinc.com 39533 Woodward Ave., Suite 145, Bloomfield Hills 48304 248-593-5700; nutechs.com 219 S. Main St., Suite 300, Royal Oak 48067 866-TEAM-TTI; trilliumteam.com
Researched by Sonya D. Hill: shill@crain.com | This list of temporary-employer/staffing-service companies and companies that provide such services is an approximate compilation of the largest companies in Wayne, Oakland, Macomb,
Washtenaw and Livingston counties. 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. Companies with headquarters elsewhere are listed with the address and top executive of their main Detroit-area office. G-Tech Services Inc. declined to participate. NA = not available. NOTES: e. Crain's estimate. 1. Merger between Technosoft Corp., Apexon and Infostretch Corp. completed on April 13. 2. Named new CEO after the merger of Technosoft Corp., Apexon and Infostretch Corp.
Want the full Excel version of this list — and every list? Become a Data Member: CrainsDetroit.com/data
APRIL 25, 2022 | CRAIN’S DETROIT BUSINESS | 27
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CRAIN'S LIST | GRADUATE BUSINESS DEGREE PROGRAMS Listed alphabetically TYPES OF PROGRAMS
MINIMUM GPA
MINIMUM GMAT/GRE
COST PER CREDIT HOUR AS OF MAY 2022
DEGREES OFFERED
MICHIGAN CAMPUS LOCATIONS
Andrews University
MBA; MSA in Organizational Management
Berrien Springs
On-campus, online, offcampus
2.60
Varies
$1230
Aquinas College
Master of management (M.M.) with concentrations in organizational leadership, marketing management and sustainable business
Grand Rapids
Part time, full time
3.0, two years work experience
450
$651
Baker College Center for Graduate Studies
MBA, doctor of business administration
Auburn Hills, Cadillac, Jackson, Muskegon, Owosso, Royal Oak
Online, full time, and part time
2.5
Optional
$695 for masters; $915 for doctorate
Central Michigan University
M.S. in administration, information systems; MBA; master of arts in economics, Clinton Township, Dearborn, M.A. in economics; online master of entrepreneurial ventures; doctorate in health Detroit, East Lansing, Grand administration, educational technology Rapids, Mount Pleasant, Traverse City, Saginaw, Southfield, Troy
Full-time, part-time, evenings, weekends, in person, hybrid and online
Varies by degree
Varies by degree
Resident: $682 for masters; $778 for doctoral; Nonresident: $850 for masters; $725 for MSIS/MBA; $940 for doctoral
Cleary University
MBA in strategic leadership, MBA in health care leadership, MBA in analytical efficiency, MBA in women's leadership, MBA in leadership, MBA in sports administration, MBA in digital marketing, MS in culture, change and leadership, MS is human resource management
Howell, Detroit
Online, blended
2.5
NR
$858
Concordia University - Ann Arbor
Fully online MBA with 14 concentrations and Doctorate in Business Administration (DBA) with three concentrations.
Ann Arbor
Full time, part time, evenings and online
Please see NR web for full requirements
NA
Cornerstone University, Professional and Graduate Studies
MBA; MBA concentrations in health care administration, global business, project management, finance; Doctor of Education in Organizational Leadership and Development
Grand Rapids Kalamzaoo
Full time, evenings, online
2.7
NR
Masters: 565-610; Doctor of Education in Organizational Leadership and Development: $745
Davenport University
MBA with concentrations in finance, health care management, human resource management, marketing, and strategic management, executive MBA, others
Detroit, Grand Rapids, Lansing, Holland
In-seat and online, fullor part-time, days and evenings.
2.75
N/A
$906
Eastern Michigan University Ypsilanti 48197 734-487-4444
MBA (general or choose from 13 specializations); M.S. degrees in accounting, finance, human resources/organizational development; information systems; integrated marketing communications; tax consulting
Ypsilanti
Full time, part time, evenings, and/or online
2.75 (3.0 for MSA, MSF, MST)
450 (500 for MSA or MST; 550 for MSF). May be waived.
$920
Ferris State University
Master's in business administration
Big Rapids (Majority of courses in this program are offered online)
Online, weekends, campus
3.00
500/upper 50th percentile
$686 (U.S. residents and Canadian); $1,030 international
Grand Valley State University Seidman College of Business
MBA, executive MBA, M.S. in accounting. MS in Taxation
Grand Rapids
Part time, hybrid, fulltime(for MSA only)
3.0
NA
$773
Kettering University
MBA with certificate programs in global leadership, supply chain and ERP, operations management, healthcare management. Tech MBA with focus in data analytics and big data, advanced mobility, new energy and sustainability, materials science and engineering, advanced manufacturing, systems engineering, logistics & supply chain management. MS in Engineering Management with concentrations in technology leadership, supply chain and ERP, operations management, healthcare management and more
Flint, MI
Online, full-time
3.0
NR
NA
Lawrence Technological University
MBA with concentrations in business analytics, cybersecurity, finance, Southfield, Clinton Township, information technology, marketing, and project management; M.S. in Taylor, Plymouth, Warren Information Technology, with concentrations in business analytics, cybersecurity, and project management; Master of Science in Business Data Analytics; Master of Healthcare Administration; dual degrees: MBA/M.S. in Information Technology, MBA/Master of Engineering Management, MBA/Master of Architecture; MBA/ M.S. of Business Data Analytics; Graduate certificates
Full time, part time, and online
3.0
Not required unless undergrad GPA is under 3.0
$1288
Madonna University
MBA; M.S. in health services administration; online; M.S. in accountancy, online; nursing administration/business administration dual degree (MSN/MBA); M.S. in criminal justice leadership and intelligence; 4 certificate programs
Livonia, Gaylord, Macomb
Part time, evenings, weekends and online
3.0
NR
$935
Michigan State University - Eli Broad College of Business
MBAs: Full-time and executive; M.S. degrees in accounting, business data science and analytics, finance, financial planning and wealth management, healthcare management, management strategy and leadership, marketing research, supply chain management. Ph.D.s in accounting, finance, information technology management, logistics and more
East Lansing; Troy
Full time, part time, evenings, weekends, and online
Varies
Varies
NA
Michigan Technological University College of Business
TechMBA, engineering management, accounting, and applied natural resource economics
Houghton, Michigan
Campus, full time, part time
3.0
550/NR
$1182
Northern Michigan University Walker MBA, master's of public administration L. Cisler College of Business
Marquette
Full time, part time, campus, online and evenings
2.75
500/NR
Graduate: $612 for residents, $828 for nonresidents; MBA: $717
Northwood University Richard DeVos 12-month Accelerated MBA, Evening MBA, Online MBA, Master of Science in Organizational Leadership (MSOL), Master of Science in Finance (MSF), Master of Graduate School of Management
Midland, MI
3.0
Science in Business Analytics (MSBA), Master of Science in Human Resources (MSHR), Doctor of Business Administration (DBA)
A GMAT/GRE score is not required for admission
$840
Midland 48640 800-622-9000
Full-time and part-time programs, offered in both online and inperson formats
Oakland University School of Business Administration
MBA, 100% online MBA, weekend executive MBA, M.S. in IT management, M.S. in Business Analytics, master of accounting; graduate certificates and post-master's certificates offered
Rochester, Clinton Township, Mt. Clemens
100% online, partial online, part time or full time, evenings, some Saturdays.
NA
NA
$803
Olivet College
MBA with concentrations in insurance, enterprise risk Management and general business
Olivet
100% online with a flexschedule format
2.75
NR
$904
Saginaw Valley State University
MBA
Saginaw
Online, hybrid, part time, 3.0 evenings
450
$656
Siena Heights University
Master of arts in organizational leadership, health care leadership and higher education leadership; MBA Program
Southfield, Jackson, Monroe, Adrian, Battle Creek, Benton Harbor, Lansing, Dearborn, Kalamazoo
Online
NR
$675/credit hour MBA Program: $755/ credit hour
Berrien Springs 49104 269-471-6321 Grand Rapids 49506 616-632-2924
Flint 48507 800-469-3165
Mount Pleasant (and other locations) 48859 989-774-4000
Howell 48843 517-338-3332
Ann Arbor 48105 734-995-7300
Grand Rapids 49525 616-222-1448
Warren, Detroit, Grand Rapids, Lansing, Lansing 48092 810-459-0587
Big Rapids 49307 231-591-2000
Grand Rapids 49504 616-331-7400 Flint 48504 800-955-4464
Southfield 48075 248-204-2210
Livonia 48150 734-432-5763
East Lansing 48824 517-355-8377
Houghton 49931 906-487-2668
Marquette 49855 906-227-2900
Rochester Hills 48309 248-370-3287 Olivet 49076 269-749-6612
Saginaw 48710 989-964-6096 Adrian 49221 (517) 264-7662
3.0
Researched by Sonya D. Hill: shill@crain.com | This list is an approximate compilation of colleges with a physical presence in Michigan. Information for this list was provided by the schools through surveys or their websites. It is not a complete listing, but the most comprehensive available. NA = not available. NR = not required.
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28 | CRAIN’S DETROIT BUSINESS | APRIL 25, 2022
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CRAIN'S LIST | GRADUATE BUSINESS DEGREE PROGRAMS Listed alphabetically TYPES OF PROGRAMS
MINIMUM GPA
MINIMUM GMAT/GRE
COST PER CREDIT HOUR AS OF MAY 2022
DEGREES OFFERED
MICHIGAN CAMPUS LOCATIONS
Spring Arbor University Gainey School of Business
MBA with concentrations in health care administration, management, organizational consulting and executive leadership. Master of arts in management and organizational leadership; master of arts in communication
Southfield, Temperance, Jackson, Spring Arbor, Lansing, Grand Rapids, Kalamazoo, Flint, Gaylord
Face to face (one night a week) or online, hybrid
3.0
NR
$752
University of Detroit Mercy
MBA; JD/MBA; MBA/MSCIS; MBA/MHSA; MBA for healthcare professionals; 5-year BS/MBA, Master of Science in ethical leadership
Detroit: McNichols Campus; Detroit: Riverfront Campus; and online
Part time, full-time and online MBA; part-time or full-time
3.0
Can be waived with professional experience.
$825
University of Michigan-Dearborn College of Business
MBA; Online MBA; MS in accounting, MS-business analytics, MS in finance, online MS in finance, MS-information systems management, MS-marketing, MS-supply chain management; MBA dual degrees with MS in finance, MS-information systems, MS-supply chain management, MSE in industrial and systems engineering, Master of health services administration and more
Dearborn
Full time, part time, evenings and online
Competitive with applicant pool
Competitive with applicant pool
$1025
University of Michigan-Flint School of MBA with concentrations in: accounting, computer information systems, finance, health care management, international business, supply chain management, Management
Flint
All degrees can be completed online. Also online, hybrid, hyperflex courses, part time or fulltime.
Varies
GMAT waiver available
$833
University of Michigan Ross School of Full-Time MBA, weekend MBA, online MBA, global MBA, executive MBA, master of management, master of accounting, master of supply chain management, Business1
Ann Arbor
Varies
NR
NA
Ann Arbor 48109 734-615-5002
master of business analytics and PhD.
Full-time, part-time (weekend and online), and executive education
University of Windsor Odette School of Business
MBA; master's in management, professional accounting specialization, managers and professionals, engineering management
Windsor
Full time, online
2.75
Generally required but can be waived in some circumstances.
NA
Walsh College Troy 48083 248-823-1600
MBA; Cyber MBA; Tech MBA; M.S. degrees in accounting, data analytics, finance, information technology, information technology leadership, management, marketing, taxation; dual MBA/MS in finance, dual MBA/MS in IT leadership, dual MBA/MS in management, dual MBA/MS marketing; graduate certificates and more
Troy; classes at Macomb University Center, Oakland Community College-Orchard Ridge and St. Clair County Community College
Full-time, part-time, evenings, on ground and online/remote
Varies
NR
$884
Wayne State University Mike Ilitch School of Business
MBA; MBA-J.D. dual; M.S. degrees in accounting, finance, data science & business analytics, Executive MS in Automotive Supply Chain Management
Detroit, Livonia
Full time, part time, evenings, weekends and online
2.75
GMAT 450; GRE 149 Verbal/149 Quantitative; Ph.D. 600 GMAT GMAT waivers available to eligible applicants.
$818
Western Michigan University, Haworth College of Business
MBA, MS in accountancy, graduate certificate and MS in cybersecurity and MBA/ MD
Grand Rapids, Kalamazoo
Evening courses (full or part-time), online
2.5
GMAT 450 or equivalent GRE score
$703
Spring Arbor 49283 517-750-6611 Detroit 48221 313-993-1200
Dearborn 48126 313-593-5460
Flint 48502 810-762-3160
Windsor, Ontario N9B 3P4 519-253-3000
Detroit 48201 313-577-4511
Kalamazoo 49008 269-387-5133
marketing & innovation management, and organizational leadership; M.S. in accounting; MS in leadership & organizational dynamics; graduate certificate in business; post-Master's certificates and more
NOTES: 1. Also known as Stephen M. Ross School of Business at the University of Michigan
Whitmer seeks bailout to keep nuke plant open Lake Michigan plant is set to close; one of three in the state BY CHAD LIVENGOOD
able lower energy costs for working families and small businesses." The plant's owner, New OrleGov. Gretchen Whitmer is urging federal intervention to help keep one ans-based Entergy Corp., announced of Michigan's three nuclear power the plan to close the plant and exit plants operating for another nine the merchant power business in 2017 and has a deal with another compayears. Whitmer sent a letter Wednesday to ny, Jupiter, Fla.-based Holtec InterU.S. Department of Energy Secretary national, to take over the plant for Jennifer Granholm — a former Michi- decommissioning. The Biden administration on Tuesgan governor — urging the Biden administration to dedicate funds from a day told the Associated Press it is new federal program to keep the launching a $6 billion effort to rescue 51-year-old Palisades Nuclear Plant in nuclear power plants at risk of clossouthwest Michigan's Covert Town- ing, citing the need to continue nuclear energy as a carbon-free source ship running through 2031. The 800-megawatt nuclear plant of power that helps to combat clion the shore of Lake Michigan near mate change. A certification and bidding process South Haven has been scheduled to opened Tuesday for a civil “KEEPING PALISADES OPEN IS A TOP nuclear credit PRIORITY.” program that is intended to bail — Gov. Gretchen Whitmer out financially shut down at the end of May, threat- distressed owners or operators of nuening 600 jobs that Whitmer said av- clear power reactors, the AP reported. The money from the federal infraerage $117,845 annually. "Keeping Palisades open is a top structure package will be the largest priority," Whitmer wrote to Gran- federal investment in saving finanholm. "Doing so will allow us to make cially distressed nuclear reactors. Entergy acknowledged WednesMichigan more competitive for economic development projects bringing day that it has had talks with governbillions in investment, protect hun- ment officials. "However, it is importdreds of goodpaying jobs for Michi- ant to note that no formal proposal to gan workers, and shore up Michigan’s acquire Palisades has been made clean energy supply and provide reli- that provides an opportunity for con-
tinued operations and that eliminates the substantial financial and operational risks associated with unwinding the existing contract with Holtec," the company said in a statement. "We remain on schedule for the plant’s permanent shutdown on our previously announced timeline and currently have no additional comment about the outreach we received." There are a number of obstacles to keeping the plant open, the company said. "There are challenges that make continued operation of the facility beyond May 2022 difficult, including the pending transfer of more than 130 employees to other parts of Entergy’s business and planned employee retirements post-shutdown," the company said. "Additionally, the plant is unable to operate beyond the target closure date due to the diminished power of its nuclear fuel as it reaches the end of its two-year operating cycle. Entergy did not order new nuclear fuel because the plant is scheduled to permanently shut down." In her letter to Granholm, Whitmer said the state would submit a "compelling" application for the civil nuclear credit program by May 18. "The state of Michigan has already had numerous conversations with the plant owner and leading nuclear operators who may be interested in purchasing the plant and keeping it operational through its 2031 licensure date," Whitmer wrote. Since 2007, Entergy has sold elec-
The Palisades plant in Covert Township. | ENTERGY CORP.
tricity generated at the Palisades Nuclear Plant to Jackson-based Consumers Energy Co., which sold the plant to Entergy that year for $380 million. The Palisades nuclear plant sits on a 432-acre complex in Van Buren County's Covert Township and is a major source of tax revenue for local schools and municipalities. Consumers Energy's purchase agreement expires this year. Both companies have previously said purchasing electricity from the Palisades plant "was higher than the projected costs of purchasing energy and capacity from the electricity market," according to a September 2017 memo from the Michigan Public Service Commission. MPSC staff has previously expressed concern about the loss of Palisades' 800-megawatt electricity
generation — enough electricity to power 800,000 residential homes — and the potential impact on electric reliability "when there is uncertainty about the future reliability in both Michigan and the Midwest region." Consumers Energy spokeswoman Katie Carey said Wednesday that the future of the Palisades plant "is really up to Entergy and Holtec who will need to decide whether (staying open) is possible." "Consumers Energy is not interested in operating a nuclear plant again, but if the power from the plant could provide competitively priced and reliable energy for our customers, we would consider working with our partners to keep the plant open," Carey said in an email to Crain's. Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood APRIL 25, 2022 | CRAIN’S DETROIT BUSINESS | 29
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CORKTOWN
From Page 3
The scoreboard was ordered to be removed by June 17, but months later, it was still standing. It wasn't until early this year that it was finally taken down. "We are glad this issue is well on the way to being resolved so that we can move forward with constructing 60 units of housing on the Left Field site, 48 of which will be reserved as affordable housing," Donald Rencher, the city's Group Executive of Housing, Planning and Development, said in a Feb. 2 statement. "Once completed, we will be able to begin the process of rebuilding the Clement Kern site and moving forward with our plan of adding 500 units of affordable housing in one of the city's most in-demand neighborhoods."
But the issue still isn't resolved. David Greenwood, PAL's director of programs and operations, said Wednesday that discussions about getting the scoreboard back up are "still in process." He said he hopes to have it operational by the Special Olympics in July, and that the preferred location is in the right field of the park. "We're working diligently with the developers and the city," he said. "We're working diligently to try to get it right and get it put back up."
'Off the table' In an email to Greenwood last July, Mike Essian, the vice president of American Community Developers, said he was "most concerned with a swift resolution." "Delays thus far risk interfering with the City's broader Choice
PEOPLE ON THE MOVE
Neighborhoods Initiative timeline," he wrote. "Regardless of how the scoreboard is resolved, we continue to recommend that PAL arrange for alternative means of trash removal and field egress (other than across our site) as soon as possible. Our construction security fence will extend around the entire boundary of our site. I mentioned this to you in May, and we are quickly approaching groundbreaking." American Community Developers closed on the property in October, according to the correspondence. For a time, the agreement assumed ACD would pay for the cost to move the scoreboard — some $215,000 to incorporate it into the design of the Left Field development, according to emails. But Essian said in an email to a Detroit Housing and Revitalization Depart-
ment employee that "we have been very clear that we do not have the money for this." "This is an affordable housing development on a very slim budget," he wrote. "Our position from the beginning has been that it is up to the City and PAL to figure this out." Essian went on to say that the scoreboard, which was two-and-ahalf feet onto the development's property, wasn't in place when his company agreed to the the development. "The fact remains that ... it was installed after the fact and it encumbers our land and impedes our ability to build the project — therefore, it has to be removed from our site," he wrote. "We will cooperate with figuring out a good solution, but the solution/cost is not ours to solve." Essian didn't want to comment
Advertising Section To place your listing, visit www.crainsdetroit.com/people-on-the-move or, for more information, contact Debora Stein at 917.226.5470 / dstein@crain.com
ACCOUNTING
FINANCIAL SERVICES
INSURANCE / BROKERAGE
NONPROFIT
UHY Advisors
PNC Bank
Wilshire Benefits Group
Services to Enhance Potential
Robert Boesiger, CPA, JD, LL.M. has joined UHY Advisors as Managing Director. Boesiger will lead UHY’s Estate Strategy and Trust practice and help UHY clients to create effective estate tax and asset protection strategies that can include a variety of tools, such as trusts, advanced estate planning strategies, insurance policies, and other methods.
PNC Bank has promoted Josephine Obasuyi to executive vice president, retail distribution market executive. In this role, Obasuyi will manage PNC’s branch network in Southeast Michigan and Toledo, which includes 95 branches. Obasuyi has more than 27 years of banking experience at PNC, including her most recent role leading PNC’s Merchant Service business financials and client experience across seven states. She serves on the boards of the Boys and Girls Club of Troy and Cranbrook Academy & Art Museum.
Managing Director Lisa Chorazyczewski has been promoted to Vice President. With 30+ years of industry experience, Lisa will guide the service model, staff development and company growth. President David Sokol said, “Lisa’s dedication to legendary customer service has fostered strong relationships with clients, vendors and team members over her 10 years at our company. She embodies the Wilshire Way in everything she does, and I am honored to have her expand her leadership within the company.”
Services to Enhance Potential is pleased to announce that Michele GarrettFinley has joined the team as its Chief Financial Officer. In addition to joining the Executive Leadership Team at STEP, Michele will bring her 20+ years of financial experience to a highly skilled and experienced finance team. Services to Enhance potential is celebrating its 50th year anniversary in 2022 and provides services to over 1300 individuals with intellectual and developmental disabilities annually.
NONPROFIT
The Children’s Foundation
BUSINESS DEVELOPMENT
GOVERNMENT / NGO
DFCU Financial
Oakland Community Health Network (OCHN)
DFCU Financial is pleased to announce the recent addition of Caitlin Japowicz as Vice President, Commercial Loan Officer. Caitlin comes to DFCU Financial after serving at Huntington / TCF Bank for 8 years. Her background in commercial lending and credit analysis and her commitment to cultivating strong commercial client relationships will be of special benefit to DFCU’s evolving Commercial Banking initiatives.
Bernard Hooper, JD, M.A.E is Oakland Community Health Network’s new Chief Corporate Compliance and Diversity, Equity, and Inclusion (DEI) Officer. Hooper’s certification in healthcare compliance and experience in executive leadership and policy are essential in this position. Additionally, he leads the development and implementation of the OCHN DEI Strategic Plan, including key performance indicators regarding programmatic approach, DEI metrics, as well as organizational culture and practices.
The Children’s Foundation announced that Todd Krieger has joined the senior leadership team as Chief Officer of Strategic Partnerships and Community Affairs, a position aimed at increasing The Foundation’s footprint as a community foundation for children, young adults and families. Krieger will develop strategies that focus on enhancing the organization’s community partnership efforts, as well as developing strategic initiatives that lead to greater impact in The Foundation’s priority areas.
NONPROFIT
SME SME has named Jeannine Kunz to the new position of Chief Workforce Development Officer. She joined SME in 2000 and previously served as vice president, Tooling U-SME — manufacturing’s top provider of learning and development solutions — overseeing manufacturing workforce training and education for SME. Kunz was recognized as a 2018 Notable Women in Manufacturing and 2019 Notable Women in Education Leadership in Michigan by Crain’s Detroit Business for her professional accomplishments.
on the dispute regarding the scoreboard, but said he's "really excited" about the Left Field development and the whole Corktown project. Settlement terms went back and forth for months between the city and PAL, until the end of September, when Deputy Corporation Counsel Chuck Raimi sent a letter calling PAL out for its lack of action and agreement to the terms. In it, he said that everyone at the city "loves PAL's mission" and that the police organization had "received many considerations" in regard to the creation of its facility on the old stadium site. But, he wrote, the organization's delayed response to a proposed solution "was as negative, arrogant and insulting as could be imagined, refusing to address any issues other than the scoreboard and attempting to renegotiate the terms of the scoreboard relocation that the developer had proposed, and that PAL had agreed to in principle." "In view of PAL' s response, the proposed settlement is off the table and we see no purpose in additional meetings," Raimi wrote. "... PAL is hereby directed to promptly remove its illegal scoreboard."
Waiting for an award The negotiations later resumed and Greenwood told Detroit Mayor Mike Duggan's chief of staff, Trisha Stein, in a December email that he was "Working feverishly to get this done for you." It appeared that a final agreement was reached in January. In the meantime, Essian applied for $357,390 in Low-Income Housing Tax Credit dollars in a second round of funding for projects that were awarded credits in 2019 or 2020, but had seen costs rise. A spokesperson for the Michigan State Housing Development Authority said in an email that "discussions are still ongoing between MSHDA, the developer and the City of Detroit in regard to this project." "An official award of additional credit has not yet been made for Left Field," Anna Vicari wrote earlier this month. Essian confirmed Wednesday that the funding still had not been approved. Left Field had previously been approved for $1.2 million in such tax credits in 2020. "We're waiting for the final award from MSHDA before we can proceed," Essian said. He said if construction begins soon, the project will be able to finish by the end of 2023. But supply chain issues that are causing delays of materials could stretch the timeline. Schneider, with the city, said funding issues were reconciled at the same time the scoreboard was moved off the Left Field land, so the fault for the delays didn't lie with PAL. "The construction costs is what caused the delays," she said. "Quotes are increasing. Gaps are increasing. Knowing that we have uncovered costs, what other funding sources can be brought to the table?" The delays have also hit The Preserve on Ash, she said, a 160-unit affordable housing development that is also using LIHTC funding to help pay for construction costs. "It doesn't mean a disruption to the plan," Schneider said. "Residents are going to have housing in Corktown should they want it."
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HONIGMAN
From Page 3
President Joe Biden speaks at the POET Bioprocessing facility in Menlo, Iowa, on April 12. Biden plans to allow expanded sales of higher-ethanol gasoline in an effort to lower fuel prices and counter political blowback. | RACHEL MUMMEY/BLOOMBERG
ETHANOL
From Page 3
Griffin said any reduction in gas prices is good for the station owner, as only 30 percent of profits come from dispensing fuel and the rest from convenience store options. “The higher the price of fuel, the less money customers have to spend in the store where the bulk of our profits are made,” Griffin said.
A greedy crop Ethanol is a growing market for corn farmers in the state. About 30 percent of Michigan’s total corn production, or approximately 100 million to 150 million bushels annually, supply the ethanol industry. Roughly 90 percent of the corn used to make ethanol stays in the state. There are five ethanol production plants in Michigan. Only four are currently operational, up from just two at the start of the pandemic when fuel usage plummeted 60 percent. The ethanol plant in Blissfield, 30 miles west of Monroe, remains offline. The plant is owned by Texas fuel maker Valero Energy Corp., who bought the plant along with two others out of state in a $300 million deal with Green Plains in 2018. Valero shuttered the plant indefinitely in 2019 due to weak margins. But the plant may reopen in the coming months as sources indicate several buyers are going through financial inspection to acquire the operations. A real estate source familiar with the plant told Crain’s one company performing due diligence was family owned, Brighton-based fuel transporter Corrigan Oil Co. Corrigan did not return several emails and calls about the matter. Jim Zook, executive director of the Michigan Corn Growers Association and the Corn Marketing Program of Michigan, said the other four plants are operating at full capacity, showing the demand for ethanol. For Miller, with Miller Family
Farms, more ethanol production means more opportunity. His operation farms 2,500 acres of crops including corn, soybeans and wheat and houses 15,000 hogs. With the Russia’s unprovoked war against Ukraine, the global supply of corn is being crippled — Russia supplies about 3 percent of total global corn exports — and prices are skyrocketing to the benefit of Michigan farmers. May futures have corn prices at $7.80 per bushel, up from less than $6 per bushel in May 2021. That’s double the average price Miller’s crops have received in the past eight years, he said. “We have a strong base under us with corn prices, but it’s not just pure profit,” Miller said. “Input costs are eating up the extra corn price.” The cost of nitrogen, a critical nutrient for corn production, is up 240 percent over last year, Miller said. Phosphorous and potassium, the other raw materials for fertilizer, are up exponentially as well. “Inflation is kicking our butt bad,” Miller said. “If fertilizer prices don’t settle down, we’re in for a world of hurt. We know grain prices (corn, wheat, etc.) will come back down to earth but we don’t see how fertilizer prices are going to come down.” Miller said after crop prices start dropping, it takes at least 18 months for fertilizer prices to drop at the same rate. High input prices and the temporary nature of the Biden order means Michigan farmers are reticent to grow more corn crops to meet any increased ethanol demand, said Theresa Sisung, field crops specialist for the Michigan Farm Bureau. “It’s not going to cause any huge shift in corn production,” Sisung said. “While we’ll have more corn going into ethanol, moving to E15 from E10 just isn’t a substantial amount. Corn prices make it look like farmers will be doing well, but the gross margins are not high due to rising input costs. While prices are at near record levels, costs are absolutely at record levels.”
Long ears, more years The Biden order only expands summer production of ethanol this year. Ethanol use is not typically allowed in the summer months, a rule made in support of the oil lobby based on arguably questionable science about ethanol and greenhouse gases. Without a long-term strategy, all the experts interviewed agree that the move isn’t enough to boost real ethanol demand. “A lot of farmers believe this is a step in the right direction, but they want E15 year round instead of just this emergency situation,” Sisung said. “If it’s permanent, we may see more ethanol production, but not really until then.” Griffin said it’s unlikely gas stations currently not offering E15 will make the move without a permanent rule in place allowing year round use. “We want to invest our money wisely,” Griffin said of gas stations. “This alone is not the tipping point. It’s E15 now, but what happens when it becomes E30 or something different? How do we invest for future fuels that no one can tell us what they will be? While this brings some surety to the ethanol market, it doesn’t help us invest for the future." "The diplomat in me will say I understand why the administration will try to do this," he continued. "It will give the appearance they are doing everything they can to lower the price of gasoline. But tong term it may be one of the many solutions we take.” Zook said the current state of global politics and rising costs has the farming industry hopeful and mobilized to make E15 a permanent reality. “We’re hopeful the EPA won’t yank the waiver next year,” Zook said. “This is the opportunity to set the path to provide a permanent outlet for Michigan corn and help Michiganders at the pump.” Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh
“The other (risk) was we would recruit lawyers for our private equity team who would grow to be remarkably successful and everybody would want to hire them,” Foltyn told Crain’s. “We hit the second risk — we were wildly successful.” Alex Plakas, Nathan Wilda and Drew Rosenberry all came to Honigman directly or indirectly from Kirkland & Ellis between 2015 and 2017, according to their LinkedIn profiles. Harris Eisenberg, one of the leaders in the group of 27, joined Honigman in 2018 from Katten Muchin Rosenman, according to his LinkedIn profile. Together, those four partners drove deals that made Honigman the No. 2 most active law firm in the U.S. in 2021 for private equity, and No. 4 globally, according to rankings by the global research firm PitchBook. "We've gotten our share of benefit from it," Foltyn said Friday. "It's our turn, now, to see this group go." DLA Piper saw the practice group, led by Eisenberg and Plakas, as a "tremendous opportunity" for the firm to grow through middle-market private equity deals, said Joe Alexander, DLA Piper’s US vice chairman. "This premier group, led by Harris and Alex, exemplifies what we’re looking for: top-notch practitioners who are difference makers in major markets," Alexander said in a statement. For DLA Piper, the deal adds 27 lawyers to its Chicago office, which employed 168 attorneys in 2021, making it the 12th-largest law firm in the Windy City last year, according to Crain’s data on Chicago law firms. Honigman had 324 attorneys worldwide in 2021, 274 of which were based in Michigan as of June 2021, making it the state's largest law firm by number of lawyers, according to the Crain's Data Center. Foltyn said several of the junior members of the Chicago-based
team "were shocked" they were leaving Honigman abruptly this week to follow their bosses to DLA Piper. "But they don't have much choice because those were the guys they were working for," Foltyn said. A 27-attorney grab is not the largest lateral move on record — there was a 43-attorney move earlier this month in New York — but it's significant, said legal recruiter Kay Hoppe. Hoppe said it adds to the trend of large group hires from smaller firms, which can be more efficient for staffing up quickly. "Private equity is highly prized and getting substantial business in private equity is something many firms aspire to," Hoppe told Crain's Chicago Business. "So you have to take note when you see a deal of this size." Given the active market for lawyers jumping to other firms, those in the deal-making space are more than used to hearing about these types of moves. M&A experts note that the work generally continues uninterrupted given the long-standing relationships that tend to exist, said Rajesh Kothari, a managing director with Cascade Partners, a Southfield-based investment bank. “So much of (this business) is relationship-driven,” said Kothari, who said he has done several deals with Honigman M&A attorneys, largely in Michigan. Honigman's CEO was optimistic the 74-year-old law firm would be able to rebuild as it continues its years-long strategy to grow through lateral hires. "We are hearing from the street that there are other lawyers interested in bringing their practices to us," Foltyn said, "and growing their practice off our platform in the same way that Harris (Eisenberg) and Alex (Plakas) did." Crain's Staff Reporter Nick Manes and Elyssa Cherney of Crain's Chicago Business contributed to this report. Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood
Honigman’s headquarters in Detroit’s First National Building. | WIKIPEDIA
Advertising Section
CLASSIFIEDS To place your listing, contact Suzanne Janik at 313-446-0455
JOB FRONT POSITION AVAILABLE
U.S. District Court, Eastern District of Michigan – Chief Deputy of Administration (Type II)
Vacancy Announcement at http://www.mied.uscourts.gov. Located in Detroit, this senior executive-level, professional position (equivalent to a vice-president) is responsible for the day-to-day operation and supervision of the administrative departments of the Court. EOE APRIL 25, 2022 | CRAIN’S DETROIT BUSINESS | 31
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CASINO
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Drake, who took on his Greektown role in 2019 following the Penn acquisition. “Connectivity between some of our properties, more specifically Toledo, is a big part of it. A lot of our customers go back and forth to enjoy events and activities. We’re trying to showcase the entire Penn network in terms of what they have available in other states and locations.” Drake and Marvin Beatty, Greektown vice president of community relations, said market share in Detroit plays a role in the rebrand. In 2021, the three Detroit casinos reported $1.294 billion in revenue, according to the Michigan Gaming Control Board. MGM Grand Detroit had 43 percent of the overall market, followed by MotorCity Casino Hotel at 35 percent and Greektown at 22 percent. Beatty said the corporate backing from Wyomissing, Pa.-based Penn Gaming (NASDAQ: PENN) will bolster the Greektown casino’s market share. Drake, who previously served as president and CEO of Casino Rama Resort in Ontario, said the rebranding will bring up the standards at the property, which opened in November 2000. “We’re absolutely looking to improve our market share,” Drake said. “Our team members are up for the challenge, too. So I really see this as bringing our customers a better experience.” Greektown currently has a staff of 1,000 and aims to be fully staffed at 1,200 team members, down from more than 2,000 pre-pandemic. The majority of the staff works in the casino, with 60 employees staffing the hotel.
Greektown Casino Vice President and General Manager John Drake (left) and Chief Community Officer Marvin Beatty, in Greektown Hotel’s newly renovated lobby in Detroit. | PHOTOS BY CYDNI ELLEDGE PHOTOGRAPHY/SPECIAL TO CRAIN’S DETROIT BUSINESS
Upgrades underway Penn since taking over has invested $100 million into the Greektown property.That includes renovation of all 400 hotel rooms in the 30-story tower, which will be complete later this summer, according to Drake. The rooms will reopen in phases. More than 200 rooms have already been renovated. The renovations began during the height of the coronavirus pandemic. Greektown’s hotel remained closed for 18 months until reopening just last monthwith a new 6,500-square-foot, $30 million lobby featuring a cocktail bar and interior design celebrating the city of Detroit, including several pieces of art. A Dunkin’ coffee shop will open later this summer in the southwest corner of the lobby. All of the property’s carpets, hallways, elevator vestibules and other common areas have received a floorto-ceiling refresh. The site also has a
A newly renovated hotel room on the 18th floor of Greektown Hotel.
Greektown Hotel’s recently updated lobby.
from the Dunkin' shop, additional undisclosed dining options will be available in the coming months. The casino will offer Urban Cocktail and Rock bar lounges for guests on its first floor. The Monroe Market food hall will feature a new Detroit Taco Company location. Prism, the property's steakhouse, will unveil a new menu from Chef Petro Drakopoulos. A first-floor bar/restaurant concept is set to open in August with seating for 120 guests that add 20 jobs. “PART OF OUR BUSINESS IS LOOKING FOR will T h e 3 8 , 0 0 0 -s q u a re DIFFERENT WAYS TO BRING PEOPLE IN, foot fourth floor of EVEN PEOPLE WHO DON’T LIKE TO the casino, currently unoccuGAMBLE.” pied, will become — Marvin Beatty, Hollywood Casino Hotel home to a 1,3001,500 seat entertainment venue, Drake said. new HVAC system. “Part of our business is looking for “Now that we’re moving through a horrific element that we’ve experi- different ways to bring people in, ence the last two years, we’re now even people who don’t like to gamstepping up to do much more on a ble,” Beatty said. “What we’re doing is creating a huge amount of variety more aggressive basis,” Beatty said. and new possibilities for our customers. We want to have something for Focus on entertainment everyone.” The casino, which doesn’t have a New food and entertainment options are on the horizon as well. Aside dedicated musical entertainment
space, has entered into a partnership with Music Hall Center for the Performing Arts that will bring in a variety of musical and comedy acts to perform at the more than 1,700-seat Detroit venue. Acts such as Boyz II Men, Dionne Warwick and Pat Benetar are already scheduled to perform later this year. The new Hollywood Casino at Greektown is investing about $200,000 in upgrades to Music Hall and will provide guests transportation to and from the casino, according to Beatty. The upgrades include updated restrooms, digital boards and a new marquee outside the 94-year-old Music Hall. For the Greektown-run shows, the entities split the tickets, said Vince Paul, Music Hall's president and artistic director. "They've developed a program and an entertainment component the casino didn't have before," Paul said. "We love it because it adds to the 300 shows we already do each year and brings in a new audience." Beatty said the concerts help both parties. “When the Music Hall can put thousands of people in its seats, the benefit speaks for itself,” he said. “The Music
Hall a few years ago was on the brink of bankruptcy. Today it has more shows than it's had in years. This will move people into a lot of the restaurants in the area.” Greektown’s partnership with Barstool Sports for its on-site sportsbook, which has generated 60 jobs, will remain intact, although Penn's stock last year took a significant drop following a negative report on Barstool's founder, Dave Portnoy. Sports betting, which came to the Detroit casinos just as the coronavirus pandemic took hold in March 2020, has accounted for a substantial portion of Greektown’s revenue, according to Beatty, who declined to disclose specific figures. The state gaming board reported that Greektown casino brought in $9.47 million in retail sports betting in 2021.
Setting new standards Penn is also investing in customer experience, making the Greektown property the first casino in Michigan to offer a new cashless, cardless feature called mywallet within its mobile mychoice rewards app. The Bluetooth-connected technology allows guests to connect to slot machines and table games without going into their pockets for cash. Winners will see funds added to their balance on the free app. The app is a part of the casino’s efforts to go cashless and contactless, according to Drake. A feature for cashless parking will be added to the app in
the near future. Cash payments for games and parking will continue to be accepted, Drake said. “In today’s world, we know people are carrying less and less cash. This gives them a chance to be a part of a cashless system with the comfort and security of not needing to come in with money in their pockets,” Beatty said. “We’re the first entity in the market to offer the feature, which is a real opportunity for customers to feel comfortable about the way money exchanges hands. This is certainly going to be the wave of the future.” The company said it has also invested more than $1 million in improvements to the casino’s self-park and VIP parking garages. Beatty and Drake are confidence the rebranding and upgrades at Greektown will lead to a shift in the market, making the soon-to-be Hollywood Casino at Greektown a major player in Detroit. “Really, we’re just pleased to be able to put in this level of investment into the property,” Drake said. “Greektown has been open for almost 22 years. We want to further mark our place in this market,” Beatty said. “All the moves — the upgrades and name change — demonstrate the strength of our entity because this corporate relationship with Penn provides us with a lot of things being an independent agency might not. There’s the financial aspect, but now we’re providing team members with growth opportunities. This relationship has added a lot of value.” To celebrate its rebranding, Hollywood Casino at Greektown will make a $10,000 charitable contribution to the Greektown Neighborhood Partnership and host red-carpet-themed private VIP and community special events on May 19 and May 21. Find more details at greektowncasino.com/casino/promotions. Contact: jason.davis@crain.com; (313) 446-1612; @JayDavis_1981
32 | CRAIN’S DETROIT BUSINESS | APRIL 25, 2022
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REFUGEES
vices; and various throughout the city.
From Page 1
gaps, more important than ever. Resettlement agencies began conservative hiring and reengaging with volunteers in May, after President Joe Biden raised the annual cap on refugees to 62,500 from what was 15,000 during the last year of the Trump administration. Refugees from Middle Eastern and African nations were still being vetted and processed when the Taliban took control of Afghanistan last year, forcing more than 76,000 Afghanis to flee their native country. The U.S. government prioritized the resettlement of those refugees here. More than 1,160 Afghan refugees have arrived in Southeast Michigan since last fall, according to the combined counts from the region’s four local resettlement agencies. Jewish Family Services of Washtenaw County is resettling just less than 300 of the refugees in the county, said Mira Sussman, refugee resource development manager. Detroit-based Samaritas is helping another 550. It’s continuing to move Afghan refugees from a Detroit hotel where they were temporarily being housed, along with other refugees being resettled by Catholic Charities of Southeast Michigan. Samaritas is moving refugees into housing in Wayne, Oakland and Macomb counties, said Kelli Dobner, chief advancement officer. And thanks to a new partnership between Samaritas and the city of Detroit, even more families from war-torn regions should be finding a safe home in Detroit.
The Detroit Refugee Network The Detroit Refugee Network, spearheaded by Samaritas — which is serving as the fiduciary — is seeking $1.125 million in additional funding as it works to help refugees with things like housing, education, transportation, English as a second language classes, employment and other services, the Detroit-based nonprofit announced Wednesday. It is co-chaired by Dobner from Samaritas and Dr. Sonia Hassan, a Wayne State University-affiliated OB-GYN and the wife of Detroit Mayor Mike Duggan. The Detroit Refugee Network will work with Samaritas, the U.S. Committee for Refugees and Immigrants — which is based in suburban Washington, D.C., but has a field office in Detroit — and Southfield-based Catholic Charities of Southeast Michigan. Combined, those groups have helped settle more than 650 refu-
WALSH
From Page 6
credits followed —to the disdain of Northern Michigan politicians who can’t use those economic wins and investment to run for reelection. It’s an election year, after all, and Whitmer has plenty of political enemies from Republican strongholds north of Saginaw. The $50 million investment might effectively buy some good graces from politicians like Wentworth and Sen. Curt VanderWall and their constituents. It also likely helped get the $4.7 billion infrastructure spending bill — with more than $1.7 billion for drinking water and wastewater system
landlords
Other refugees
Samaritas welcomed a family from Afghanistan into their permanent home in Southeast Michigan in mid-March. There were 115 new residents from Aghannistan who also received laptops, home internet and free tech support to help them get established in their new lives. The donations were made possible through a partnership with Human-I-T and General Motors Co. | SAMARITAS PHOTOS
Sanya Gholamy stands near baggage claim at Detroit Metro Airport as she waits for her sister, brother-in-law and their baby to arrive from Afghanistan.
gees from Afghanistan in the region since last year, when the Taliban regained control of the country. The group also expects to help refugees from the Ukraine in the coming weeks. "We also know that refugees from Ukraine are expected to come into our care in the coming weeks and months, and the Detroit Refugee Network will play a key role in combining support, services and resources to ensure their safety and resettlement," Dobner said during a news conference Wednesday in Detroit announcing the organization's formation. Among the new organization's priorities are finding affordable housing for the refugees while putting them on the path to home ownership, basic needs, safety and legal services, health care and family wellness, employment programs, transportation, cultural a nd social education, education and school integration and faith community partnerships. "When these families arrive in the U.S., they have to feel safe," Hassan said during the announcement. "They need homes, food, transportaimprovement projects, $450 million for parks and trails, $317 million for road and bridge repairs and $250 million for broadband infrastructure grants to expand high-speed internet to underserved areas — across the finish line with bipartisan support. Critical infrastructure spending, thanks to a little pork in the middle. We’re likely to see more subsidies heading toward the Mackinac Bridge in the future as well. A source tied to economic development in the state confirmed more dollars, thanks to ample federal stimulus funding linked to the pandemic, are likely headed up north to placate those typically Republican legislators. There’s little doubt the mine is good
tion, and legal help. For their futures, they need an education, a career and financial stability. They need furniture. When I met some of these families in their very modest new homes, they were extremely happy. This was despite having no living room furniture, or tables. They were happy just to have their own kitchen, to be able to make their own food and feel like they were at home. Their dream is simply to become a contributing member of the society here in Detroit." Billed as an effort between the civic and business communities, the Detroit Refugee Network has secured funding from Atlanta-based CARE USA ($50,000) for cash payments of up to $1,000, and an inkind donation of $750,000 from Detroit-based Rocket Community Fund, which will have seven employees embedded within Samaritas as part of the Detroit Refugee Network focusing on finding housing for the refugees as well as providing workforce support. "They will manage relationships with landlords, monitor inventory leads and coordinate move-ins," Laura Grannemann, vice president of the Rocket Community Fund, said Wednesday afternoon. Dobner said the needs are great and will require a lot of support from a lot of organizations. "This absolutely takes a village," she said. Dobner said the organization has also received assistance from the city; Wayne County; Livonia-based NYX Inc., which has hired more than 100 refugees; Ride United, which has provided transportation; Christ Church Cranbrook, which has created medical and dental clinics; Kroger Co., which is providing food; Gardner-White Furniture, Serta Inc. and Lighthouse have provided mattresses; Wayne Metro Community Action Agencies, which has provided food, hotels and other ser-
Refugees from other countries, including Syria, Iraq and Congo, started arriving in the region in January and February, agencies said. The Dearborn office of the U.S. Committee for Refugees and Immigrants has resettled 109 refugees from those countries since the cap was lifted, in addition to 271 Afghans, Director Tawfik Alazem said. Samaritas expects to resettle about 1,000 people from those and other countries in the region, Dobner said, before the end of the federal fiscal year in September. Catholic Charities of Southeast Michigan, which closed its small refugee resettlement program in 2018, after the U.S. Conference of Catholic Bishops pulled back on sending refugees to smaller resettlement programs, restarted the program in September. The Clinton Township-based nonprofit, which is helping 49 Afghans resettle, should be done moving them from hotels to housing by the end of the month, said Omar Tucktuck, director of refugee resettlement. Over the past few months, it’s begun taking in refugees from Syria, he said, and expects to resettle about 110 primarily from the Middle Eastern country by summer. At the same time, local agencies are hearing from their national affiliates that a new wave of refugees from war-torn Ukraine will also be coming, given the significant population of Ukrainian Americans in the state and region. Michigan has more than 39,000 residents of Ukrainian descent, according to the 2019 American Community Survey conducted by the U.S. Census Bureau. Agencies don’t know how many Ukrainian refugees will come or when, but they are preparing. USCRI “is continuing to follow the developments in Ukraine closely and will determine the course of action as we get more information from the Biden administration about the most imminent needs,” Alazem said. “We stand ready to accept and help Ukrainians who are fleeing violence and persecution.” Many of those expected to come to the southern border of the U.S. when that reopens with the May 23 expiration of Title 42 — the Trump-era policy that allows rapid expulsion of migrants at the border and blocks them from seeking asylum due to the coronavirus pandemic — will be seeking asylum and granted humanitarian parole status, a protection that does not afford the same resettlement benefits as pre-vetted refugee status, Dobner said. But a small number
from Venezuela could also secure refugee status and come through the southern border to the U.S. and wind up in Southeast Michigan.
Staffing up Each wave of refugees brings the need for specialized staff who can speak their language and new volunteers to help with expanded acculturation efforts, resettlement agencies said. They are on the hunt for housing specialists, social workers and people with specialized language skills amid tight competition for talent. But they are also being strategic in their hires, given that funding follows the refugees. USCRI is “planning to carefully staff back up to hopefully regain back our old capacity,” Alazem said. “Our agency used to resettle around 800 refugees each year between 2008 and 2016 in Wayne, Macomb, and Oakland counties.” All of Catholic Charities of Southeast Michigan’s current employees speak Arabic, Tucktuck said. “Eventually we’ll need to step up with more staff” to help with translation needs for the Afghan and Ukrainian refugees, he said. “If we can’t find (those), we might have to rely on (the U.S. Department of Homeland Services) or web-based translation apps. We’ll see how other agencies are doing that,” he said, noting resettlement agencies meet virtually each week with the state’s refugee coordinator. As with other resettlement agencies, policies during the Trump administration “decimated” resettlement infrastructure at Samaritas, Dobner said. Samaritas resettled just 68 refugees in the region in 2019. This year, it projects it will assist 1,500 or more and at least that many in 2023. Seventy-five percent of refugee families resettled by Samaritas achieve self-sufficiency in 180 days, Dobner said, and that requires a deep team providing services around housing, employment, transportation, education, cultural orientation and legal services. The agency last fall hired about 20 employees who were critical to Afghan refugee resettlement, adding to its skeleton crew of five at the time, Dobner said. Like other resettlement agencies, Samaritas is looking for people who speak Ukrainian and Russian and staff to handle the larger number of programs that will be available for Ukrainian refugees. “It will be a more traditional refugee situation than the Afghans have been ... we need to beef up our staff to handle this quickly,” she said. Contact: swelch@crain.com; 313-446-1694; @SherriWelch
for Osceola County and for Michigan — and Midwestern farmers and agricultural suppliers and the politicians that represent them. But it’s not clear if Michigan tax payers really needed to be involved in the deal. When the governor, whomever that may be in 2025 when the mine opens, and legislators pose for photos with giant scissors to commemorate the grand opening of the mine, remember they bought their way in. And we’re likely to see more of those scenarios among the Michigan jack pines of the Upper Peninsula and northern lower peninsula in the years to come. Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh
A rendering of what the potash mine could look like at the Michigan site. | BARTON MALOW APRIL 25, 2022 | CRAIN’S DETROIT BUSINESS | 33
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THE CONVERSATION
David Tsai on the future of MGM Grand Detroit and gambling Since the COVID-19 pandemic shutdown in 2020, revenue at the three casinos in Detroit has rebounded significantly, but not completely. Business at MGM Grand Detroit is down 10 percent to 15 percent from pre-pandemic days, said David Tsai, president of MGM Resorts’ Midwest Group. Tsai, 42, said it could be because of a lingering hesitancy to be out in public, more competition with online gaming, or a yet-to-be-lifted indoor smoking ban that has driven away some regular customers. Detroit Mayor Mike Duggan credited the casinos with offsetting some of the city’s pandemic losses. That’s one major reason Tsai said he sees the casino’s future as being intertwined with that of the city, and he’s determined to make it a bright one. This conversation has been condensed and lightly edited for clarity. | BY KURT NAGL `How did you start in the gambling industry? I started actually in management consulting and corporate strategy, working for a consulting firm called McKinsey way back when and then started doing corporate strategy work for Capital One and expanding their bank business. And I’ll be honest, I kind of loved what I did, knew I wanted to be in business in general, but wasn’t excited about the industry. I kind of took some time off to go back to business school and pursue my MBA and really kind of give some thought to what I wanted to do with my career and my life. I went to Vegas … and kind of just started thinking about it as a career. I tried it for a summer and absolutely fell in love. It’s just incredibly exciting. That was probably 15 years ago, and now I can’t imagine working anything else. `Why did you leave Vegas for Detroit? I was in Vegas for about 12 years … I always kind of knew I wanted to, you know, lead an organization and really own a part of the business. So an opportunity came up to be able to do that in Tunica, Miss. So, I made the move and decided to put my hat in and decided to move out to Las Vegas and actually work in Tunica for a couple of years right before the pandemic … And then when an opportunity came up to come to Detroit — we have a much larger scale operation here at a beautiful property — I kind of jumped at that opportunity. I’d never been to Detroit at that time. Of course, I moved here right before the pandemic. It was a little bit hard to really get to know a city with everything that was going on. But as things opened up, I really enjoyed being out here. Love the summers more than the winters.
` Detroit isn’t usually thought of as a destination city for gambling, but have you thought about ways to position MGM Grand Detroit as a destination property within the portfolio? There’s a lot of thought being put into it. As you know, Detroit over the last 20 years hasn’t had the greatest reputation. Now that I’ve been here, I see what Detroit’s all about. I see the excitement of the city. I see how far it’s come. I think when you talk to some other folks outside the state, even in the suburbs outside of downtown Detroit, there’s still sometimes this lack of awareness that downtown Detroit has come a long way. It’s safe. It’s clean. There’s a lot of amenities. There’s restaurants and bars and lounges and entertainment. It’s actually a great destination … We have partnerships with all the local professional sports teams in Detroit. We have suites at the stadiums and arenas. We use it as an opportunity to bring in people from other states and say, ‘Hey, your team is playing in town. Come watch your team, and by the way stay at our property,’ and use this as an opportunity to hopefully (make them) fall in love with Detroit and then make Detroit more of a tourist destination. There’s no reason why they need to hop on a plane for five hours and go to Vegas or Atlantic City when we’re a shorter distance and there’s very convenient flights here. They can get all the entertainment experience here in our city just as much as they get anywhere else.
finding that a lot of our customers have come back and a lot of new customers, too. If you look at where the overall market is, we’re probably running about 10 to 15 percent below where we were in 2019.
sure now that we provide an elevated customer experience. Definitely more about entertainment hospitality to give people a reason to come in. That’s where every gaming market has evolved.
` Do you think that is going to be recovered? It’s very hard to say. We know that there’s a couple of things that have been at play for the market. Because our community was particularly hard hit by COVID when it first came out … I think there’s still the lingering effects of that … I think the fact that we currently don’t have smoking, which is also something that we have not brought back for obvious reasons with the pandemic — we know that there are some customers who have limited the visitation because of that, or maybe have even traveled down to Ohio as a result. And then possibly, you know, the fact that we also have online gaming at the same time, you know, which we think is a good thing because it’s generated a lot of incremental revenue for the city and for the state and we’re very happy, but now we offer convenience. So, folks now, if they want to smoke for instance, they can stay at home and also place a sports bet or gamble without having to come in. So that’s why our focus is very much, we got to make
` Any changes or new offerings on the horizon at the property? We think there’s an opportunity for upscale nightlife. Many other cities already have this, and we actually have this at many other casinos, but we’re thinking about more of an ultra lounge that can also provide some type of gaming experience. The idea of upscale nightlife where a group of girls or a group of guys can kind of get dressed up and have a nice night out. We want to be able to think about providing that kind of experience.
David Tsai president MGM Resorts' Midwest Group
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Ex-Domino's staffer to pay $2M in trading case
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BY CRAIN'S DETROIT BUSINESS
A former accountant for Domino's Pizza Inc. will pay a penalty of nearly $2 million in an insider-trading case, the U.S. Securities and Exchange Commission announced Wednesday. The complaint against Bernard L. Compton was filed April 13 in the U.S. District Court for the Eastern District of Michigan. It alleges that Compton used confidential financial data he obtained through his role as an accountant in the Ann Arbor corporate office of Domino's to trade the company's stock ahead of 12 of the company's earnings announcements between 2015 and 2020. The complaint also alleged Compton spread these trades across seven different brokerage accounts
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belonging to himself and members of his family, which led him to make $960,000 in illicit profits. "The SEC investigation uncovered
that Compton allegedly accessed and reviewed Domino’s confidential data to prepare financial performance reports for senior manage-
ment," Joseph G. Sansone, chief of the SEC’s Market Abuse Unit, said in a press release. "Using innovative analytical tools, SEC staff exposed the defendant’s repeated misuse of this inside information and are now holding him accountable." More specifically, Compton violated the antifraud provisions of Section 10(b) of the Securities and Exchange Act of 1934 and Rule 10b5, according to the complaint. Compton consented to the court's April 19 order to pay a civil penalty of $1,921,394 without admitting guilt or denying the allegations. He also agreed to be suspended from practicing as an accountant before the SEC, which means he can no longer participate in financial reporting or audits of public companies.
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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.
34 | CRAIN’S DETROIT BUSINESS | APRIL 25, 2022
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DETROIT
Other Mackinac issue opportunities are available: email Lisa Rudy at lrudy@crain.com for details.
MAC TL full 2022.indd 1
4/12/22 2:37 PM