Crain's Detroit Business, Oct. 3, 2022, issue

TRAVEL

COST CRUSH

Legislation seeks to regulate prices.

HEAVY HITTER

Downtown Boxing Gym poised to grow at home and internationally BY| SHERRI WELCH

e Downtown Boxing Gym Youth Program will soon be punching far above its weight class.

e nonpro t wraps free academic support, mentoring and social-emotional learning around its boxing programs. And it breaks down barriers like transportation issues, food insecurity and the digital divide to help youth age 8 and up access them.

During the 15 years it has operated, 100 percent of the kids in its program have graduated high school.

Word of DBG’s success has gotten out. It’s gotten requests to bring the program to Romulus and to license it from groups in another Midwest state, Spain and Africa.

Setbacks strike for downtown

GM pulls back on return-to-work; Meridian subleasing its space

BY KIRK PINHO

In the span of less than seven days, two major downtown Detroit employers demonstrated just how fragile the central business district's recovery is.

Even as visitors downtown rebounded to pre-pandemic levels in recent months, the o ce-dominated downtown core's economic health continues to rely heavily on the o ce employers there — and the whims of one or two can chip away at momentum.

First, in a Friday afternoon news dump, General Motors Co. told its salaried workforce that it was to return to the o ce — including the Renaissance Center — three days a week by the end of the year, which would be a boost for restaurants and other small businesses not only in the RenCen but elsewhere

Metro Detroit manufacturers ride roller coaster of issues

Shipping costs, logistics issues still a plague

BY KURT NAGL

Dramatically declining international shipping rates and rising domestic delivery rates have made for a logistics rollercoaster for Michi-

gan companies.

A Detroit-based clothing and accessories retailer and a Walled Lake-based toy manufacturer are having opposite experiences heading into this holiday season.

MyLocker.com LLC, which imports the bulk of its accessories from China and Korea, was reeling from container costs and delays this time last year. CFO Bob Kendall said it cost upward of $10,000 — nearly 10 times the pre-pandemic rate — to move a container from the Far East to the U.S. and eventually to its 120,000-square-

foot warehouse in Corktown where it customizes and ful lls orders.

“I think it’s better, big picture,” Kendall said. “We’re still baking some excess shipping time into our planning, but hopefully we won’t be blindsided like we were last year by extreme delays.”

e cost to move a 40-foot con-

tainer across the ocean from Shanghai to Los Angeles has plummeted 70 percent since last year to $3,779, according to the Drewry World Container Index. at is down 11 percent from last week but still triple where it was before the COVID-19 pandemic.

Jim Bieri thrives where real estate meets legal practice.

General Motors’ home in the Renaissance Center. | KIRK PINHO/ CRAIN’S DETROIT BUSINESS

From left, Ze’Kiah V, 11, Trystan K, 10, and Steven B, 11, partake in a boxing lesson at Downtown Boxing Gym in Detroit. | NIC ANTAYA/CRAIN’S DETROIT BUSINESS

NEED TO KNOW

THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S

POLITICS

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DEMOLITION OF PART OF PACKARD PLANT BEGINS

THE NEWS: A portion of the historic but dilapidated Packard Plant is coming down, with demolition crews starting to tear away pieces of one of its buildings. e blighted property, which sits on both sides of East Grand Boulevard, has been abandoned for years.

WHY IT MATTERS: It could take two years to demolish what can't be saved, Mayor Mike Duggan said. He hopes that properties facing East Grand Boulevard can be spared, but the city's demolition department in the coming months will determine if that's possible.

the historic United Artists eatre building downtown.

e Bagley Development Group working on converting the attached United Artists Building o ce tower into 148 apartments at 150 Bagley St. is razing the C. Howard Crane-designed theater attached to it that opened in 1928. e resulting space will provide parking to residential tenants.

WHY IT MATTERS: Construction on the 18-story building o cially began in March after years of delays caused by nancing snags and other issues. e redevelopment was announced in May 2017 as part of what was then a $160 million plan to bring 686 residential units to the Ilitch family's District Detroit area.

tion comes as Amazon giant manages a cycle of contraction following the e-commerce boom resulting from the COVID-19 pandemic.

 NOVI STARTUP ROLLS OUT BREAST CANCER SCREENING TECH

Detroit Economic Club will host Dixon, Whitmer at candidate event

 e Detroit Economic Club will host a pre-election event with Gov. Gretchen Whitmer and challenger Tudor Dixon.

e candidates will appear separately on stage Oct. 21 at the MotorCity Casino Hotel to answer questions and state their cases to lead Michigan. e same format was used in 2018.

Journalist Christy McDonald will moderate.

e lunch-hour event will come eight days after what is currently the only scheduled debate between the Democratic governor and her Republican opponent.

WOOD-TV in Grand Rapids will host the hour-long debate on Oct. 13, roughly four weeks before Election Day. Political reporter Rick Albin will moderate.

It is unclear at this time if the two will meet for another debate.

Both campaigns have accepted di erent dates for a debate later in October proposed by WXYZ-TV, WXMI-TV and WSYM-TV in Detroit, Grand Rapids and Lansing. Dixon also has expressed interest in two other debates.

AMAZON AXES DELIVERY CONTRACT, 98 LAID OFF





DEMOLITION OF HISTORIC DETROIT THEATER FOR PARKING LOT BEGINS

THE NEWS: Demolition has started on

THE NEWS: Amazon Inc. is terminating its contract with a Plymouth-based delivery contractor, resulting in 98 layo s, just a few weeks after cutting ties with another local company in the same manner. e e-commerce giant “suddenly and unexpectedly” told DETDSP Inc. that it would end its contract at the 12795 Premier Center Court warehouse e ective Friday, DETDSP told the state in a WARN notice.

WHY IT MATTERS: e contract termina-

THE NEWS: Delphinus Medical Technologies Inc., a spin-out from the Barbara Ann Karmanos Cancer Institute in Detroit, is tapping into its roots and installing its newly commercialized technology called SoftVue — designed for mammography for the roughly 40 percent of women with dense breast tissue — into the cancer hospital on the Detroit Medical Center campus in the city's Midtown neighborhood.

WHY IT MATTERS: e installation of the SoftVue technology — which the U.S. Food and Drug Administration approved last October — comes amid the company also closing its $30 million Series D funding round earlier this month. at will serve as the engine to propel the company forward.

Tudor Dixon (left) and Gov. Gretchen Whitmer. | AP

GROWING

A MIDDLE CLASS

Detroit Future City builds its own future around strengthening Detroit’s shrinking middle

Detroit Future City will focus on growing Detroit’s middle class and improving quality of life in neighborhoods as the next iteration of its longterm plan to revitalize the city.

e self-described “think and do tank” charged with implementing the Detroit Strategic Framework will seek improvements in three primary areas between now and 2030: economic opportunity and development, housing, and climate resiliency.

A strong middle class represents economic security and access to opportunity and is important for the city’s nancial well-being, DFC said.

And the city needs high-quality neighborhoods to both attract middle-class households and retain residents.

“What you will see over the next eight years is not only just the DFC reports, but you will see us leading and convening others that are working in neighborhoods to get on the same

page about how we can actually change the trajectory of Detroiters here so that Detroit becomes a place where you can stay, where you can raise your family, where you can live as a single person and thrive,” President and CEO Anika Goss said.

DFC will focus on urban planning and design with neighborhoods, disrupting systemic racism, education, employment and economic opportunity, she said.

Many othergroups in the city are focused

BY| SHERRI WELCH

on lifting people out of poverty, she said. DFC will work on lifting people into the middle class and keeping them in the city.

“Unless you have a way to move from poverty, to the middle class, and further, to create your own wealth, unless we are really intentional about how those opportunities happen in Detroit, we end up losing ground...(and) population,” Goss said.

on

RETAIL

Lover's Lane expands

BY JAY DAVIS

Lover’s Lane & Co. is spreading the love.

e 30-year-old Plymouth-based company earlier this month acquired Cleveland-based Ambiance Inc., giving the popular retailer of lingerie, sex toys and romantic gifts an additional seven locations throughout Ohio. With the acquisition, Lover’s Lane now operates 38 stores in Michigan, Indiana, Illinois and Ohio.

e move had been in the works

for some time, Michael Allmond, Lover’s Lane co-founder, vice president and general manager, told Crain’s.

“We wanted to continue to expand, but stay in the Midwest,” said Allmond, who declined to disclose the purchase price. “We’d been looking at (Ambiance) for some time. We’d talked with the owners over years about an acquisition. It’s the easiest way for us to grow because it’s expensive to open a store with a complete build-out.”

Lover’s Lane will have four locations in Cleveland, and one each in Canton, Youngstown and Cuyahoga Falls, according to Allmond. Each location over the past nine months has been remodeled and rebranded. All of the Ohio stores will be about 2,500 square feet, while locations in Michigan, Illinois and Indiana average 3,000-4,000 square feet, Allmond said.

REAL ESTATE

Subsidized housing short even with help

New fair market rents only go so far

BY ARIELLE KASS

It's so hard to nd subsidized housing in Michigan that the state Housing Development Authority had already gotten permission to pay 120 percent of a federal gure for fair market rents here — and sometimes that still wasn't enough.

" at helped, but it still didn't cover that gap," said Lisa Kemmis, director of rental assistance and homeless solutions for MSHDA. "Even at 120 percent, it's closer, but it's still not where the market will support. ... It's tight."

Across the state, thousands of low-income people who have access to housing vouchers that help pay their rent are having trouble

nding landlords who will take them, when they can get more income on the open market. A federal measure that dictates what local agencies can pay was recently raised, but even with that increase, it's not clear that it will be easier to nd shelter.

Kemmis has looked for other means to incentivize landlords to o er their apartments for subsidized housing. A $600 bonus for landlords who sign on has had some success, as has a $3,000 guarantee above a tenant's security deposit to help ensure any damage will be paid for.

"We had to employ strategies to attract and retain landlords," Kemmis said. " ey can probably achieve higher rent not accepting a voucher."

A group with the Field Guide to Working with Lots Tour (in fall 2019) visiting Detroit Future City grantee and partner Arboretum Detroit’s installed tree nursery. Since 2019, hundreds of trees from that nursery have grown and been replanted throughout the neighborhood, including at the Elmwood Circle Forest site. DETROIT FUTURE CITY

Chain hits 38 stores, with help from Net ix After a recent acquistion, Lover’s Lane & Co. has 38 stores in Michigan, Indiana, Illinois and Ohio. | LOVER’S LANE & CO

Jax Car Wash scouting 250plus sites for new locations

e car wash craze continues.

Southfieldbased Jax Kar Wash, armed with Birmingham private-equity backing, is scouting more than 250 sites for new locations in southeast Michigan and all the way out to Lansing.

Now to be clear, it's unlikely they will take all of those, or maybe even unlikely they take the majority of them. But that gives an indication of the type of growth the car wash chain envisions in the near future.

e company, now owned by TRP Capital Partners, has hired Detroit-based Stokas Bieri Real Estate to scout for sites, which are a mix of ground-up development properties as well as existing car wash locations that would be purchased and converted into new Jax locations.

Josh Zeid, associate broker for Stokas Bieri, said Jax looks for sites ranging from 0.8 to two acres in size with a tra c volume of at least 28,000 vehicles per day, preferably on a hard corner — although it's not mandatory.

"I really can't say how many of those will be going through, but we are partnering with developers all over town to ensure Jax has the best sites," Zeid said.

" ey are hungry and are opening as many as possible," he said, noting that some of the 250-plus properties are currently under contract.

Jax, certainly, isn't the only car wash chain expanding now that it has serious institutional capital along for the ride.

As Crain's Detroit Business' new

car wash beat reporter — I kid, I kid — I wrote about this earlier this month, focusing on El Car Wash, a chain based in Florida that also has a bunch of sites in the pipeline, about 50 in all, after it was purchased this summer by Warburg Pincus, the world's ninth-largest private equity rm with $73 billion in assets under management, for an

undisclosed price.

Warburg Pincus is seeing, in large part, what other PE rms are seeing: An industry that has matured from mom-and-pop shops operating with inconsistent revenue streams to one that has secured a more steady cash- ow system with monthly subscription models.

at has drawn the attention of institutional money, which sees an industry ripe for roll up, much as has happened in industries like self-storage, manufactured housing and marinas, where real estate investment trusts have muscled their way in.

e Jaxes and El Car Washes and others of the world that come into the region and expand will be ones to watch.

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

Olympia, Related execs: Hotel near LCA might not necessarily be an Equinox

BY KIRK PINHO

Conversations about what brand of hotel would go south of Little Caesars Arena remain ongoing, in spite of previous assertions that it would be an Equinox hotel with amenities tailored to professional athletes.

Two top executives of the Ilitch family's Detroit-based Olympia Development of Michigan real estate company and New York City-based Related Cos., run by billionaire Stephen Ross, told Crain's on Wednesday afternoon that while Equinox is under consideration, an agreement has not yet been nalized.

Ross said it would be an Equinox at the Mackinac Policy Conference earlier this year. Principals of Related are investors in the Equinox tness brand and its hotel and hospitality arm. Its rst hotel location is in the Hudson Yards development in New York City.

"It'll be an Equinox hotel with gyms, and all the sports teams will be staying there," Ross said in June.

" ere'll be a special oor for them to work out because all four of the major sports are located right there."

On Wednesday following discussion at the Downtown Detroit Partnership's fall stakeholder meeting, Keith Bradford, president of Olympia Development, and Andrew Cantor, president of Related's Michigan arm, told Crain's that an agreement is not yet nalized.

"We're gonna look at several brands and we are just going to make the right decision from the price point, from demand," Bradford said. " e whole thing needs to be evaluated. We were talking about this earlier today. ere are several brands we want to think about and we are going to evaluate them all.

A Jax Kar Wash in South eld. MICHAEL LEE/CRAIN’S DETROIT BUSINESS

“WE ARE PARTNERING WITH DEVELOPERS ALL OVER TOWN TO ENSURE JAX HAS THE BEST SITES. ... THEY ARE HUNGRY AND OPENING AS MANY AS POSSIBLE.”

Zeid, associate broker, Stokas Bieri

REAL ESTATE

A rendering of a proposed 14-story, 290-room hotel south of Little Caesars Arena in downtown Detroit.

CARING FOR KIDS

Advocating for the overall health and wellbeing of children across the state

ABOUT THIS REPORT:

Dr. Matt LaCasse Child & Adolescent Psychiatrist, Children’s Hospital of Michigan

LARRY BURNS: What got you interested in substance abuse for adolescents and youngsters?

MATT LACASSE: It’s pretty mu always been an interest. I decided to focus on psy iatry in medical s ool. I qui ly became interested in substance abuse — speci cally, adolescent substance abuse.

Burns: Can you explain a little bit about your role at Children’s Hospital of Michigan?

LaCasse: I’m a sta psy iatrist and my role is to help out kids that are medically hospitalized. We also do a lot of work out of the Emergency Department, helping kids in crisis.

Burns: Have you been surprised by anything you’ve seen because of COVID?

LaCasse: It’s been a very di cult couple of years. In general, people have struggles that need to be addressed professionally. e trend has been that kids are using more services.

Burns: The Children’s Foundation and several of our donors will be working with you in the near future. Tell us about that.

LaCasse: e substance abuse arena right now, particularly for adolescents and young adults, is a very di cult spot to be in because there’s not a lot of services. What’s absolutely necessary is a clinic that provides access to kids. Philanthropic money would allow us to not turn any kids away based on their insurance or based on their ability to self pay. We’ll o er medication, treatment, as well as general mental health treatment. e clinic will be online this year and serving Metro Detroit.

Burns: Will this be a clinic that would be for people in crisis?

LaCasse: Essentially our doors will be open for anybody that calls and says, “I am struggling.” It’s going to be tailored to the adolescent population.

Burns: What other care providers will be part of this?

LaCasse: erapists and case managers will be doing a lot of the individual therapy, family therapy. e physicians will be providing psy iatric workups, medication reviews, providing medications and sort of overseeing the operations of the clinic.

Burns: Is family therapy part of the process?

LaCasse: Substance abuse rarely stands alone; there’s o en some unresolved con ict with parents or other mental health issues within the family. If we turn a blind eye, then it would be tough to expect the problems to really ange. But if we’re able to address those things and deal with the family as a whole and as a unit, outcomes seem to be better.

Anne Perry

Michigan Area Director, American Foundation for Suicide Prevention

LARRY BURNS: Tell us about the American Foundation for Suicide Prevention.

ANNE PERRY: I lost my friend to suicide in 2007. I found the Out of the Darkness Walk at Kensington Metro Park and with it, a community of people that understood what it was like to su er that particular type of loss. I continued attending that walk and began volunteering. I ended up airing the Metro Detroit walk and joined the board of directors. I stepped into the sta role almost three years ago. is is not just work for me; this is everything. I fully believe in what we’re doing and that we can bring hope to people who have been a ected by suicide. We have apters in all 50 states. I am proud to be a part of the work that we’re doing at the Mi igan apter.

Burns: What would be an example of a program that you might have in a community?

Perry: Our main program that we deliver the most is called Talk Saves Lives. It’s a one-hour program with basic information on suicide prevention, like warning signs, risk factors and current data. We also have speci c programming around teen suicide and mental health. We have di erent modules of Talk Saves Lives, including an LGBTQ model and a seniors model.

We don’t have any direct services. We provide training for support group facilitators, but we don’t run those support groups. We also don’t have a crisis line, but we advocate for better funding for those crisis lines. If we all are able to work together, then we can hopefully reduce the suicide rate.

Burns: You recently received a grant from The Children’s Foundation. Tell us about that.

Perry: We are looking to educate 75 new trainers to be able to deliver our programs. We’re going to be hosting ve di erent conferences throughout the state.

Burns: How can people support AFSP? How do they reach out if they’re worried about a loved one?

Perry: To support us, visit afsp.org/mi igan. We’re always looking for volunteers — we have community walks throughout the state. I’d highly recommend coming to a walk and feeling that sense of community.

If you are concerned about yourself or someone close to you, my best advice is to trust your gut and to not be afraid to have that conversation. ere’s a common misconception that talking about suicide will make things worse, and I can tell you that having that conversation does the exact opposite. It allows the person to feel heard and seen. Don’t be afraid to have that conversation, and utilize the National Suicide and Crisis Lifeline by calling 988 or send a text to 741741. If there is an immediate crisis, please call 911.

Johnny Crowder Founder & CEO, Cope Notes

LARRY BURNS: Tell me about Cope Notes.

JOHNNY CROWDER: Cope Notes sends randomly timed text messages to train your brain to think in healthier patterns. It could be a psy ological fact or a journaling prompt, something to pull you out of a negative thought pattern and catalyze a positive one instead.

Burns: How many of these might occur during a day?

Crowder: Usually one or two, based on your preferences. We realized that if we text people too o en, they come to expect the messages and they don’t feel as surprising. If we don’t text people o en enough, then it won’t form new neural pathways.

Burns: How do people sign up?

Crowder: Go to CopeNotes.com and type in your phone number.

You can also give gi subscriptions for friends or family members. It’s not just for people who are living with mental illness. We serve many people who are trying to stay on top of stress and take good care of their brains.

Burns: What would be an example of a message?

Crowder: Half of what makes Cope Notes e ective is the actual text message and the other half is the delivery, the fact that it’s surprising your brain. I like this text a lot: “When anxious, your body hun es over to protect the heart and lungs. Show your body that it’s not in danger by standing up straight with your shoulders ba .”

Burns: Could you share some advice?

Crowder: Experiencing abuse as a youth made me less trusting of adults. A lot of the people that were trying to help me were kind and professional, but I had this prejudice against them simply because they were adults. ey might have reminded me of people who had hurt me. Now, I tell clinicians that some of the resistance they face from a teenager or a ild might be because of past experiences that they haven’t shared with you. Establishing trust is where a lot of focus should be.

Burns: How would you encourage others to help young loved ones that may be struggling?

Crowder: e rst thing that helped me was feeling included. I had this narrative in my mind that if I just isolated myself enough, I would be safe. In fact, that put me at greater risk because I was living with fairly severe mental illness. Being included and feeling invited helped combat my tendency to isolate. If there’s an opportunity to proactively engage with that ild consciously and on purpose, include them in something that you didn’t need to include them in.

Every ounce of e ort you put into building a relationship with a troubled teen is not wasted, even if that teen rejects you.

On this monthly radio program, The Children’s Foundation President & CEO Larry Burns talks to the community, government and business leaders about issues related to children’s health and wellness. This hour-long show typically airs at 7 p.m. the fourth Tuesday of each month on WJR 760AM. Here’s a summary of the show that aired Sept. 27; listen to the entire episode, and archived episodes, at YourChildrensFoundation.org/caring-for-kids

A slowdown means that VC market is back to 'normal'

To say the economy feels topsy-turvy is an understatement.

In ation is running rampant and in terest rates are soaring. Metro Detroit’s homegrown mortgage companies are in creasingly squeezed as mortgage rates hit lev els not seen since before the Great Recession.

Capital markets have been in retreat. In deed, global M&A activity has fallen o a cli , hitting its slowest period in a decade by at least one count.

And yet despite those rocky conditions, many businesses still see plenty of runway out there. And nowhere was that more evi dent than at ursday’s Michigan Venture Capital Association annual dinner, the group’s 15th annual gala.

While celebrating 20 years of the MVCA’s ex istence, there were few signs of broader econom ic tumult.

About 175 venture cap italists, startup founders and others tied to the sec tor who were in atten dance found a bar that was approaching topshelf and plenty of oppor tunities to discuss poten tial deals.

Ask most any Michigan venture capitalist who attended the event at Green eld Village about their level of current activity — and I did — and the response was consistent: “busy.”

But peel back one layer, and the reason be comes obvious: the venture capital market — the primary mechanism for nancing emerging, high-growth tech companies — has gone through a shift in recent months.  Back in June, right as the economy was slowing, metro Detroit entrepreneur Sergio

Nick MANES

Rodriguez told me he envisioned the market ipping from favoring founders — who have been able to secure high valuations for their companies for years — and revert back to one in which VCs are in the driver’s seat.  at prophecy, at least to some extent, has been ful lled.

For VCs — especially those who fund raised funds last year or early this year — that money now goes a lot further.

“You’re absolutely right,” one Michigan venture capitalist acknowledged to me during last night’s event when asked about their ability to get a better deal on their cur rent investments than last year — or even years before that — when founders could command sky-high valuations.

And data backs that up, at least to an ex tent. e median pre-money valuation for an early-stage startup declined 16 percent quar ter-over-quarter in the second quarter of this year, according to Pitchbook, the rst drop in more than two years.

Companies with some level of traction — commonly referred to as seed stage — are far ing better, according to the Pitchbook report, which found that the median pre-money val uation for such a company was up 33 percent this year when compared with last year.

2021 was, by most accounts, a high-water mark for the industry.

COMMENTARY

Navigating a path to digital inclusion

BY SATRICE COLEMAN-BETTS

Every day, my team and I have the privilege of helping some of Detroit’s incredible seniors nd solutions to daily challenges. at often means help getting online — whether it’s accessing health care, guring out prescription coverage or video conferencing their grandchil dren. Connectivity is a paradigm shift for Detroit’s seniors — and for everyone in our community who needs to participate in our global digital economy.

But statistics show 71 percent of adults across the country without home internet say they’re not inter ested in signing up, a clear sign we're failing to help the disconnected un derstand the doors an internet con nection can unlock. Digital skills gaps are also a big hurdle: One in six Ameri cans doesn't know how to use email or a search engine.

SaTrice Coleman-Betts is the executive director of St. Patrick Senior Center, a Detroit health, wellness and activities center for individuals 55 and older.

sectors working together.

St. Patrick worked with Com cast to establish a WiFi-connect ed Lift Zone, equipped with do nated laptops for our community’s use. An additional $75,000 grant has empowered us to launch a digital navigator program, train ing our sta and student volun teers from Wayne State Universi ty to o er our seniors technology training, one-on-one support, and assistance signing up for free broadband programs.

A recent study found that digi tal navigators are key to closing the digital divide and help reduce socioeconomic inequality. A sur vey of alumni of these programs showed they helped 65 percent of participants gain access to home internet service or a home computer; 85 percent reported using the in ternet more after participating.

As a lifelong Detroiter, I know our city has what it takes to get past these barriers to con nectivity: a can-do spirit, technological knowhow, and a practical approach to doing big things. e federal government’s A ordable Connectivity Program now provides us an unprecedented opportunity to close our city’s digital divide by making home internet ser vice free for low-income households.

But to realize this program’s transforma tive potential, we rst need to get eligible De troiters enrolled — a challenge that will not be solved by just launching an online signup page and hoping unconnected Detroiters nd it. People who lack connectivity or digi tal skills need a trusted guide to help them become aware of the program and navigate the enrollment process.

At St. Patrick, the largest senior center in Detroit, we’ve embraced innovative new models for chipping away at these barriers and helping more of our senior community members join the digital age. Now, these successes o er a roadmap others across the city can follow.

It starts with an all-hands-on-deck ap proach: the public, private, and non-pro t

We’re already seeing similar results with our seniors. e personal touch of one-onone support goes a long way – particularly when it's the cross-generational partnership of “digital native” college students helping their “digital newcomer” elders embrace all the possibilities and opportunities that exist online.

Equipped with this roadmap, and unprec edented new federal funding programs, we now have an opportunity to put these lessons to work city-wide.

Using federal broadband funds already available, Detroit could engage similar digi tal navigator partnerships with a larger group of trusted nonpro ts, community centers and churches across every neighborhood so that more of our neighbors can get connec tivity assistance from organizations and peo ple they already know and trust.

By combining grassroots outreach with hands-on training, these digital navigator projects would help Detroit tackle our digital divide head-on — and bring thousands more of our neighbors into the Digital Age.

Now as in the past, Detroiters’ talent for teamwork and technology can make our city a leader in an ever-evolving economy.

writers on issues of interest to business readers. Email ideas to Managing Editor Michael Lee at malee@crain.com.

2021 WAS, BY MOST ACCOUNTS, A HIGH-WATER MARK FOR THE INDUSTRY.

DANIEL SAAD/CRAIN’S DETROIT BUSINESS

Trinity, Beaumont leaders on lingering sta ng issues

DUSTIN WALSH

The health care industry has, historically, been recession proof. During the housing crisis and subse quent Great Recession, the industry added more than 600,000 jobs nationally even as other sectors saw major declines. However, the COVID-19 pandemic that shook health care to its core led to a mass exodus as elective procedures dried up and burnout struck in hospitals overrun with COVID patients.

Even as the world returns to pre-pandemic normalcy, health care jobs have not recovered and remain lower than before the pandemic. Tens of thousands of jobs remain open across the sector in Michigan alone.

Crain’s talked with two health care system executives about the current trend and what’s being done to better improve the situation.

 Can you share an update on your organization’s sta ng challenges?

Ane McNeil, senior vice president of human resources for Livoniabased Trinity Health: “Similar to other major health care systems across the country, we continue to experience challenges in recruiting and retaining front-line sta . These challenges are primarily felt in our support services and specialized areas of care such as radiology/diagnostic imaging, critical

Ane McNeil, senior vice president of human resources for Trinity Health and Ben Schwartz, president of Beaumont Health. | TRINITY HEALTH/BEAUMONT HEALTH

care, emergency and our operating rooms. We continue to be challenged as we try to recruit and retain registered nurses and colleagues in roles such as housekeeping, and food and nutrition.”

Ben Schwartz, president of Beaumont Health: “Like most other health systems across the nation, BHSH Beaumont Health is facing industry headwinds, such as increased expenses, in ation, expiration of CARES Act funding, and a competitive labor market. We continue to take multiple steps to address these headwinds to improve e ciencies that will position us well for the future. The pandemic took a toll on caregivers everywhere and we are taking care of our team members and supporting them with resources they need for their health and well-being.”

 Did your organization use any out

side-the-box strategies to mitigate workforce issues?

McNeil: “To help address our immediate need we have invested in short-term retention strategies for certain job roles, which includes commitment incentives, sign-on bonuses and temporary labor resources. Looking more long term, we have made signi cant investments into pipeline development and training programs, which are helping us attract and retain colleagues in critically important job categories such as nursing assistants and medical assistants. These workforce development programs have created career pathways for entrylevel colleagues and individuals in communities surrounding our hospitals. They have not only promoted diversity and equity, they have lled sta ng needs and helped grow wages $1 million over two years.”

Schwartz: “... BHSH System is investing $100M in compensation increases. The salary increases come on the heels of longer-term BHSH System initiatives to boost the number of nurses in Michigan. Through a $40 million investment over the next six years, the health system is collaborating with Oakland University and Grand Valley State University to recruit and retain more than 1,000 additional nursing students. The dollars will fund scholarships as

well as additional faculty, classroom space and equipment. The BHSH Nurse Scholar Program at Beaumont Health and Spectrum Health West Michigan was created to build a stronger talent pipeline. We’ve also launched re-recruitment campaigns, exible schedules for some roles, an on-demand pay program, educational assistance programs, and we expanded our sponsorship of visas. Beaumont also has virtual sitters to help with patient monitoring, a nurse residency program and an internal ex pool of nurses to assist with sta ng needs. We know it’s important to retain our amazing talent and recruit for the future. So, we are taking a holistic approach, we listen to our sta ’s ideas and feedback, and are looking at all options.”

yoga, meditation and exercise classes); virtual health competitions; and our leadership development program, which supports managers and directors in cultivating wellbeing amongst their teams, as well as teaching them how to identify and eliminate known drivers of burnout. Several of our hospitals have respite or colleague care rooms that are furnished with massage chairs, healthy snacks and drinks, relaxation stations with meditation options (coloring, exercise, head phones for relaxing sounds). We have also successfully launched a number of colleague resource groups, the newest being WorkParent. Currently, more than 120 colleagues are supporting one another with balancing work, family, children or caring for aging parents. Finally, we have looked to

The big story in 2020 through now is worker burnout. Has that eased? Is there work to be done to address burnout?



“WE CONTINUE TO BE CHALLENGED AS WE TRY TO RECRUIT AND RETAIN REGISTERED NURSES AND COLLEAGUES.” —Ann McNeil, Trinity Health

McNeil: “Though the worst days of the pandemic are behind us, we remain committed to supporting our colleagues in developing a healthy work-life balance and to address feelings of burnout that continue to impact our industry. We continue to provide services and support through our colleague care program (employee assistance program, pet therapy, on-site

technology and innovation as a source of support for colleagues to reduce work ow ine ciencies and to create greater connections for patients with their caregivers. We are currently piloting “Moxi,” an autonomous robotic technology that completes

CONTENT

SEC climate disclosure requirements

Questions and considerations regarding public company climate disclosures proposed by the SEC

By Deloitte & Touche LLP

A new era for SEC disclosure requirements

On March 21, 2022, the SEC issued a proposed rule that would enhance and standardize climate disclosure requirements provided by public companies. The new regulation would require organizations to provide certain climate disclosures in its registration statements and annual reports, including climate-re lated nancial impact and expenditure metrics as well as a discus sion of climate-related impacts on nancial estimates and assumptions in the nancial statements.

Ready to enhance your climate-related disclosures?

Start by reviewing what’s in store for your organization and our considerations for getting prepared.

Climate risk disclosure FAQs

1. What is the anticipated timeline for implementation?

If the SEC meets its goal of adopting the climate disclosure rule by the end of 2022, the compliance date for disclosure for calendar year-end registrants would be:

• For large, accelerated lers, 2023 ( led in 2024)

• For accelerated and nonaccelerated lers, 2024 ( led in 2025)

• For smaller reporting companies (SRCs), 2025 ( led in 2026)

2. My company is already voluntarily reporting climate/ESG data. What is different now?

If the proposed rule goes into effect, for the first time in the U.S., public companies will be required to disclose specific ESG information on governance, risk management, targets, and goals, and report and obtain assurance on their impact on climate through mainstream financial filings.

3. Will the new proposed rule require quarterly updates on climate disclosures?

The proposed financial statement disclosures would only be required in the annual audited financial statements and thus would not be included in interim financial statements filed on Form 10-Q (for domestic registrants) or Form 6-K (for foreign registrants).

4. Are there any accommodations for a “smaller reporting company,” “emerging growth company,” or private compa nies undertaking an IPO?

At this time, private companies are not subject to the proposed rule. However, private companies that undertake an IPO or SPAC merger, or are the target of a public company in a merger that requires the filing of a proxy statement or registration statement, would be required to comply with the proposed rule. Therefore, private companies may consider standardizing their climate disclosure processes.

5. How might the role of the nance organization evolve if the SEC disclosure requirement proposal is adopted?

As climate disclosures move from voluntary to required, the role of the finance organization will likely become increasing ly important. Companies may need to adapt quickly to advance their climate data measurement and reporting and to drive

decision-making regarding the allocation of resources. Companies that take immediate action may be better posi tioned to comply with any rule that is ultimately adopted, address increased investor expectation, integrate the role of assurance, and seize emerging market opportunities.

Contact John Tomas, Managing Director, Deloitte & Touche LLP at jtomas@ deloitte.com 313.396.3182 or Jennifer Smith, Managing Director, Deloitte & Touche LLP at jennismith@deloitte.com 989.633.7209 to learn more about the proposed SEC climate disclosure requirements

LGBTQ IN BUSINESS

e leaders on this list are change-agents, door-openers and role models, their peers and colleagues told us. ey create safety and community where they live and work. ey hire and mentor other LBGTQ people and help them succeed. eir specialties run the gamut from nance to manufacturing to health care to politics — and their accomplishments only keep growing.

METHODOLOGY: The leaders featured in this report were selected from nominations by a team of Crain’s Detroit Business editors based on their career accomplishments, track record of success in the eld and e ectiveness of their e orts, as outlined in a detailed application form. The honorees did not pay to be included on the list. Notable LGBTQ in Business was managed and written by Leslie D. Green. For questions about this report, contact Managing Editor Michael Lee at malee@crain.com.

STEPHANIE ANDRECOVICH Front-End Development Manager Accenture

Stephanie Andrecovich’s team of developers is responsible for a key client’s global e-commerce account. She also leads Accenture’s North America Web Accessibility Practice, where she helps clients develop and remediate their digital products for sustainable, accessible systems.

“As we worked together to grow our Corporate Citizenship work in Detroit, Stephanie spearheaded several of our most important and impactful programs, including growing our Skills to Succeed internship program for rst-generation college students across three major universities and DPSCD high school students,” said Lisa Cawley, managing director of Health and Public Service at Accenture.

Before landing a job at Accenture, Andrecovich was an assistant principal at a Los Angeles high school in an underserved community. Since joining Accenture, she has become head of the Accenture Homegrown Talent Program at Central High School in Detroit, which provides web development training. She is also co-lead for Accenture’s Detroit PRIDE employee resource group, which partnered with the Ruth Ellis Center to o er web-related skills-based career training to youth members.

JULIE CRICHTON

Director of Talent & Employee Experience GreenPath Financial Wellness

Julie Crichton joined GreenPath in 2013 as human resources manager and, after two previous promotions, was named to her current position in 2021. She chairs GreenPath’s inclusion, diversity, equity and access (IDEA) steering council.

Crichton secured DiversityFIRST certi cations for four senior leaders, conducted empathy training and trainthe-trainer diversity and inclusion sessions and directed the launch of GreenPath’s employee resource groups.

Under her leadership, the company has received several Top Workplaces awards. And in 2021, the National Diversity Council named Crichton a 2021 DEI Champion.

“Julie thinks holistically about our people and integrates our talent strategies into our overall company strategy. For example, she has led our diversity and inclusion e orts to ensure they are woven throughout our strategic plan, with a clear understanding of the ‘why’ behind the work. So, it is strategic, not episodic,” said GreenPath President and CEO Kristen Holt. “As a company, we have experienced record low turnover, despite the ‘great resignation,’ all while delivering excellent results to our clients through over 450 team members spread across the country.”

JESSE BERNAL

Vice President, Chief of Sta to the President, Chief Inclusion and Equity O cer Grand Valley State University

“As my chief of sta , (Jesse Bernal) skillfully collaborates to create space for diverse voices at all levels to be authentically present ...in the university’s strategic direction. During his tenure in higher education, he has shaped a legacy of enhancing sustainable and innovative approaches to fuel the upward mobility of our diverse communities at the university and beyond,” said GVSU President Philomena Mantella.

Bernal’s responsibilities include oversight of the university’s Civil Rights compliance functions, such as ADA, Title IX and A rmative Action. He partners with the school’s social justice student service centers and supports presidential initiatives and engagement, including the charter schools’ operations ofce. Bernal has helped GVSU increase the number of employees and students of color by more than 10 percent since 2015.

One of his biggest wins has been collaborating to develop and implement GVSU’s framework for inclusion and equity in its strategic plan. He serves on the board of the National Association of Diversity O cers in Higher Education.

DIANA CALLAGHAN Managing Director Endeavor

Since joining Endeavor in 2019, Diana Callaghan has expanded operations across the Great Lakes region. e organization supports 2,355 entrepreneurs operating 1,460 companies worldwide. Her responsibilities include working with 21 portfolio companies that together generate more than $350 million in revenue annually and have created more than 1,500 jobs.

As a “queer-identi ed woman of Cuban, Lebanese and Irish descent,” Callaghan is a passionate advocate of diversity, equity and inclusion. She previously co-chaired Ernst & Young’s Unity’s Women subcommittee in New York City and the tri-state region. And she co-led advisory services for Mission rottle, where she advised more than 40 impact investing organizations in Michigan.

“Diana is a key node in our entrepreneurial and economic development ecosystem,” said Lauren Bigelow, CEO of Growth Capital Network. “She links Detroit with venture investors and high-growth startups across the Midwest and internationally with the Endeavor platform. She launched a new ScaleUp initiative, which focuses on earlier stage companies ($1 million -$5 million) with an emphasis on underrepresented founders. Diana has also expanded the Endeavor Detroit board, secured new companies and initiated expansion into the Great Lakes region.”

JAMES COLEMAN

Vice President, Client and Community Relations Director PNC Bank

James Coleman is a founding member of the LGBTQ+ employee resource group at Detroit’s PNC. e group has grown to more than 250 members from 25 in just over ve years. He is also on the Detroit Public Schools Foundation board and the Ruth Ellis Center Highland Park board, where he has served as chair and vice chair.

“It is almost like James has been in this role for years. Not only did he hit the ground running, but he made meaningful positive changes and quickly won the hearts and minds of his direct reports and community partners,” said Ric DeVore, retired PNC regional president and current president of the Community Foundation for Southeast Michigan.

HEATHER CRUZ

Director of Access & Intake Easterseals of Michigan

“Since joining Easterseals Michigan, Heather has been instrumental in centralizing intake and access departments. She has a team orientation for getting results and providing recognition to her sta . She uses data to inform and pivot for improved outcomes and recognition of sta efforts. She embodies the values of equity and inclusivity not just for employees but for people accessing care,” said Juliana Harper, chief program o cer and senior vice president at Easterseals of Michigan.

While representing the nonpro t on the PCE Systems’ Diverse Sexual Orientation, Gender Identity committee, Heather Cruz helped create a document that supports establishing a safe and inclusive, gender-diverse workplace that meets legal and compliance requirements. She also advocated for the state of Michigan to add more inclusive terms in its gender identity elds. e state updated choices to add gender uid, androgynous, non-binary/genderqueer and two-spirit, and it changed “gender assigned to birth” to “sex assigned at birth.”

BRAD DICK

Group Executive City of Detroit

Before becoming group executive over general services and recreation in 2018, Brad Dick was director of Detroit’s General Services Department. He oversees nearly 1,000 employees in six divisions — vehicle maintenance, facilities and capital planning, blight remediation, animal control, grounds, forestry and oriculture, and parks and recreation.

Dick is currently leading the design, planning and construction of the Joe Louis Greenway, Riverside Park and Roosevelt Park projects and four new recreation centers.

“Under Brad’s leadership, the City of Detroit has renovated 160 parks and planted over 2 million da odil bulbs that bloom each Spring! His alley cleanup program is making real change in neighborhoods. Brad’s vision for the Joe Louis Greenway will link neighborhoods and surrounding communities to our award-winning Detroit Riverwalk. e City of Detroit would not be where it is today without the leadership, passion, and perseverance of Brad Dick,” said Trisha Stein, chief of sta to Detroit Mayor Mike Duggan.

In addition, Dick is a senior advisor to the City of Detroit’s LGBT employee resource group.

JAMIE FABER

Business Banking Market Manager in Michigan JPMorgan Chase & Co.

Jamie Faber leads 67 bankers and regional managers serving small-business clients with up to $20 million in annual revenue. Her responsibilities include overseeing revenue, pro tability and credit quality and hiring, developing and retaining diverse talent.

“Jamie is engaged in our Business Resource Groups that support diversity at Chase. She led the Michigan PRIDE group, which includes those who identify as LGBTQ as well as allies who support them. She received a Champions of Chase award for her mentorship and support of other managers in the Midwest,” said Deb Lawrence, Midwest Division director – Business Banking at Chase Bank.

Faber recently held a Proud Families event to educate LGBTQ+ employees and allies on the bene ts available to help them start families. She serves on the Chase Business Banking DEI council, is an executive sponsor of the local PRIDE ERG and a member of the statewide Leadership Team DEI.

In addition, she is a member and supporter of HRC, A rmations, Ruth Ellis Center, Equity Fights AIDS and the Jim Toy Community Center and serves on the Eastern Market Development Corp. board.

ANDREA FOSTER

Chief of Sta & Director for Program Development of Opioid Response

Michigan Health Improvement Alliance Inc.

Michigan Health Improvement Alliance hired Andrea Foster as an executive coordinator in 2021 and promoted her a year later to her current position.

In addition to being the liaison to the CEO and board of directors for the Great Lakes Bay Region nonpro t, she leads its CAREring Quick Response Team. Funded by the Michigan Department of Health and Human Services, QRT uses peer recovery coaches and emergency medical services personnel to support survivors of overdoses. Foster is also the Midland Mentors coordinator at the Midland County Juvenile Detention Center, connecting with adjudicated youth and pairing them with adult mentors.

She leads three groups at MHIA — the Safer System of Care team, the Secondary Response team, and the Opioid Steering team — comprised of community members assisting in the e ort to decrease opioid and fentanyl drug use.

Foster is also a volunteer advisor for Great Lakes Bay Pride and an advisor to the economic development start-up RE:Saginaw.

“ is is what Andrea embodies: She acts in the best interest of others, often thinking of them before thinking of herself. She remains focused on the work, and she is in a constant state of learning so that she is ever evolving to understand and care for those who need her most,” said MHIA CEO Heidi Tracy.

KIM HARTY

Associate Professor and Section Lead of Glass College for Creative Studies

“Kim has accomplished great things at CCS in her roles as former chair of the Crafts Department, chair of Craft & Material Studies, associate professor, section lead of Glass, and co-lead of the Anti-Racist Learning Community,” said Deirdre Young, chief diversity o cer and assistant dean in CCI’s O ce for Institutional Equity & Inclusion.

“During the pandemic, Kim worked actively to ensure students felt valued and included during their learning experience through the creation of the Inclusive Classroom Agreement to support student learning and engagement. I have found her contributions essential toward cultivating an environment where ideas and contributions can ourish,” said Young.

Harty has also launched initiatives to advance crafts in Detroit, including implementing the online marketplace Shop CCS and curating the Stop Making Sense exhibit at Center Galleries. She is also a founding board member of the Glass Education Exchange.

Moreover, she is a successful artist with a large-scale permanent installation in Detroit’s Foundation Hotel and a solo exhibit at Heller Gallery in New York that is now in the permanent collection at the Toledo Museum of Art.

ROD HILDEBRANT Owner

ShineWater

“Rod Hildebrant has been a very successful business owner in downtown Bay City since 1986,” said Dominic Monastiere, retired executive vice president and chief risk management o cer at Chemical Bank and executive-in-residence at Saginaw Valley State University.

Hildebrant started Allen Home Health Care in 1984 and built it into a $65 million company before selling it to a publicly traded company and purchasing a small hospice with $100,000 in revenue and growing it into a $60 million company. en the serial entrepreneur launched a hospice company, increased revenue to $150 million and sold it for $250 million.

His company ShineWater, which makes infused water and distributes it to retail chains nationwide, started with $40,000 in sales in 2019 and is on track to surpass $10 million in sales in 2022.

“Rod also has had a role in redeveloping and repurposing commercial buildings that have brought a new vibrancy to the downtown community,” Monastiere said.

Since 2015, Hildebrant has turned a condemned 1890s bank building in Bay City into mixed-use commercial and residential space and redeveloped an empty newspaper plant into luxury apartments.

PING HO CEO and Founder Backbone Hospitality

Ping Ho’s Backbone Hospitality is the umbrella company for several of her businesses, including e Royce, a retail shop and wine bar named in Wine Enthusiast magazine, and restaurants Mink and Marrow, which was listed in Food and Wine magazine. In addition, she plans to launch a meat processing company and restaurant in Eastern Market in 2023.

Ho, a graduate of Columbia and Brown universities, hasn’t always been in the food and beverage industry. She was previously vice president of Global Digital Business Development for Warner Music Group.

“From a consumer perspective, her food and beverage entities were always hospitable, welcoming, and of great taste. However, once I was able to work with Ping behind the scenes and see all of the nancial and operational thought and detail in her execution, my admiration became even more fervent. Ping is one of the smartest, hardworking people I know,” said Alissa Novoselick, founder and principal of Greater Impact LLC.

Further, Ho’s businesses support numerous organizations, including the Ruth Ellis Center, Alternative for Girls, Detroit Black Community Food Security Network and Keep Growing Detroit.

CARA MADZY

Vice President of Operations for Coatings Americas BASF Corp.

Cara Madzy leads about 600 people at manufacturing sites in ve countries in North and South America, including teams in new facilities in West Memphis and Geismar, Louisiana. In 2021, global sales for her division were €3.44 billion.

In addition, Madzy is the executive sponsor of BASF’s ALLchemie chapter in South eld. Under her direction, ALLchemie, an employee resource group representing LGBTQIA+ community members and allies, partnered with the nonpro t A rmations Detroit.

After the murder of George Floyd, Madzy created inclusion action plans to provide sharing opportunities for diversity and inclusion and implemented inclusive leader performance goals for greater accountability and improved employee experiences. She is also a member of the company’s Manufacturing Community steering committee, leading workstreams to enhance the retention, development and attraction of women employees along with their inclusion on the plant oor.

“I had the honor of partnering with Cara in several sessions of the … programs where we connected with our frontline supervisors across North America on their graveyard shifts. I experienced Cara’s passion and engagement, along with her authentic leadership on the topic of inclusion,” said Kristen Pforr, vice president of operations-Care Chemicals at BASF.

ANGIE MARTELL

Founder, Partner and Attorney Iglesia Martell Law Firm PLLC

Angie Martell spent four years as a senior attorney in the Inspector General’s O ce of the New York State Metropolitan Transportation Authority before founding Iglesia in 2012. Now Martell handles various litigation cases in federal, criminal, family and civil courts.

Martell also conducts free legal workshops for LGBT, Latino and deaf community members.

e Michigan Supreme Court appointed Martell commissioner of Diversity, Equity and Inclusion in the Judiciary.

And they are the chair of the State Bar of Michigan LGBTQA section and a member of the State’s Elder Abuse Task Force.

“Angie is a committed and capable advocate for the LGBTQ+ community, a person who attacks and breaks down barriers,” said Donald Wheaton Jr., past chair of the State of Michigan LGBTQA section.

In addition, Martell is a cooperating attorney for the LAMBDA Legal Defense and Education Fund, the National Center for Lesbian Rights, the Transgender Legal Defense Fund and the National Association for the Deaf.

Martell recently founded the Colibri Institute of Social Justice to help further their commitment.

AMIE NOLAN-NEEDHAM

Assistant General Counsel General Motors

“Amie is extremely astute at identifying problems and setting paths to resolution. When considering the equality challenges facing the LGBTQ community in the workplace, she takes an empathetic yet pragmatic approach to engaging stakeholders in the right conversations, paving paths for understanding and improvement,” said Telva McGruder, GM’s chief diversity, equity and inclusion o cer.

GM made Amie Nolan-Needham a senior executive in 2021. As assistant general counsel over manufacturing, human resources and workplace safety, she leads teams of attorneys. She also serves on the executive board of GM Plus, the LGBTQ+ ERG, and as an executive mentor to employees who identify as LGBTQ+. She is also the corporate secretary of Mary Barra’s Inclusion Advisory Board.

Previously, Nolan-Needham was on the boards of St. Louis Urban League, where she helped advance the rights of Black residents, and Food Outreach, serving underrepresented people living with HIV and AIDS.

KRIS RAY

Partner, Not-for-Pro t Practice Technical Leader Plante Moran PLLC

Plante Moran named Kris Ray, who develops and implements training for not-for-pro t sta and clients, a partner in 2021. She has helped grow the practice to 200 sta members and more than 1,000 clients. She also speaks on behalf of the American Institute of Certi ed Public Accountants.

In addition, Ray is co-founder of Plante Moran’s rst sta resource group, called PM Pride, and advocates for providing gender-afrming care for trans individuals on sta . Her work earned her the 2021 Professional Leader award from Oakland County.

“When Kris Ray started her career at Plante Moran in 2002, the rm looked very di erent. ere were no ‘out’ partners. ere wasn’t a DEI Council, let alone a Pride sta resource group, and being LGBTQ+ wasn’t openly discussed,” said Plante Moran Group Managing Partner Laura Claeys. “But during Kris’ tenure at the rm, she not only focused on her own career growth, but she has also been passionate about helping the rm make progress on its journey to diversity, equity and inclusion.

Outside the o ce, Ray is a Ruth Ellis Center champion and serves as treasurer and a member of the nance committee.

BOLD LEADERS INSPIRE BOLD INNOVATION

Congratulations Phillip Smith, director, ADMS and Operational Technology, for being named a 2022 Crain’s Detroit Business Notable LGBTQ in Business award honoree. Phillip innovates better experiences for our customers, and encourages others to do the same.

We admire your leadership, Phillip. Thank you!

MISTI RICE

Executive Director of Government A airs Magna International Inc.

Misti Rice is responsible for the global pub lic a airs strategy for Magna, a $40 billion auto parts manufacturer. She has so far managed 250 economic development projects valued at more than $300 million. Before joining Magna in 2016, Rice was vice president of govern ment a airs for Fiat Chrysler and director of government a airs for GSK.

Rice is the “high est-level openly gay Magna employee” and a member of the compa ny’s PRIDE Employee Resources Community Leadership team.

“In a time of political and cultural division, Misti both through example and advocacy speaks up proudly for change. She utilizes her extensive lobbying skills to in uence and pro mote LGBTQ+ issues and stand up against an ti-LGBTQ+ elected o cials,” said Tracy Fuerst, Magna vice president of corporate communi cations and PR.

RUSS RUSSELL Chief Development O cer Lighthouse MI

“Russ Russell is arguably the most ambi tious and enthusiastic fundraising profession al in our region. He is unwaveringly mis sion-focused, and when he cares deeply about a project, he lets nothing hold him back from bringing it to fruition,” said Lighthouse Presi dent and CEO Ryan Hertz.

Russell was instru mental in the merger of SOS and Lighthouse of Oakland County to cre ate Lighthouse MI and helped increase the budget from about $7 million to more than $14 million. He orga nized a pandemic relief campaign that raised more than $4 million, which saved thousands of people from foreclosure, increased shelter capacity by 400 percent and increased food support of 225 people to more than 5,000 each week.

Previously, Russell led Detroit Pal’s $20 mil lion fundraising e ort to turn the former Tiger Stadium into PAL headquarters and a youth leadership and conference center. At Forgot ten Harvest, Russell garnered 90,000 new do nors in less than ve years, helping expand the budget to nearly $12 million annually from $3 million. While at the Salvation Army Eastern Michigan Division, he set records when he generated $2.7 million in funding during a one-day radiothon.

PHILLIP SMITH

Director of Operational Technology for Distribution Operations

DTE Energy

Phillip Smith has received numerous pro motions since rst joining DTE in 1999. His team of 80 employees are responsible for roll ing out a ve-year strategic plan that includes service operations mod ernization, grid tele communications, sens ing and monitoring, distributed energy re sources, mobile eld technology and substa tion connectivity and automation.

“In my 20-plus years working at DTE, no one is more passionate and committed to excel lence than Phillip Smith. His strategic drive for results combined with a unique ability to en list others along the way creates a team win time and again,” said Steven Ambrose, vice president and chief information o cer at DTE. “In addition to delivering business re sults, Phillip is a constant voice within the leadership team, helping us to mature our cul ture on many fronts.”

As a founding member of the company’s In clusion and Diversity Oversight Committee, he drives LGBTQ+ topics, focusing on the Trans community. His committee work in cludes holding a “20-minute mini-teach around the company” on topics such as pro nouns and the di erences between race, eth nicity and nationality.

Smith also serves on the Equality Michigan Education Fund board of directors.

Vice President of People Experience StockX

David Staels is responsible for employee re tention, engagement, culture and talent plan ning at the 1,200-employee online market place and reseller. His StockX team works not only with U.S. employees but also collaborate with local leaders in Mexico and Canada. He also champions an in clusive culture.

“He is the co-chair and a driving force for PrideX, our active LGBTQ+ employee re source group, (which holds) activities that in clude a panel discussion around Transgender Day of Visibility, spon sorship of Motor City Pride and philanthropic donations to NPOs diligently working to sup press e orts to reduce the rights of LGBTQ in dividuals,” said StockX Chief People O cer Tracy Cote.

Staels has long experience in the retail in dustry and as head of human resources at technology and e-commerce companies, such as VER Technology. He also worked for Cen tria Healthcare, which provides Applied Be havior Analysis therapy to children with au tism.

DAVID STAELS

Extraordinary Mackinac Island event experiences await.

ANDREW STONE

Andrew Stone, Kahn’s youngest elected board member and corporate director, oversees a sta of 60, a multimillion-dollar budget and millions of square feet in new projects.

Highlights of Stone’s projects include a 40,000-square-foot expansion at Oakland University, a 346,000-squarefoot sustainable o ce building for Erie Insurance and an award-winning concept for a 3D-printed habitat on Mars for the NASA 3D-Printed Habitat Centennial Challenge.

“ e team designed a self-printing structure to support life within an inhospitable environment. eir design won third place, a noteworthy accomplishment for the team and a newly licensed architect,” said Pankaj Patel, principal and director of Architecture at Kahn.

A foundational member of Kahn’s diversity and inclusion committee, Stone works toward ensuring equal pay among genders and that company policies are inclusive.

Patel added that Stone also uses his talents to serve the community.

“A couple of months ago, he led an outreach event for MENSA, leading children through the conceptual design of a park on the Detroit Riverwalk. (And) each year, he leads Kahn’s CANstruction submission for Gleaners Food Bank, resulting in thousands of donated canned goods,” Patel said.

MARK WARE

CEO

Mission Point Resort

Mark Ware began his career as a math teacher and eventually became director of business operations for patient care services at Stanford Hospital and Clinics in California. In 2016, he joined the family-run Mission Point as chief nancial o cer.

Now Ware is responsible for the 241-room $15 million historic resort. Mission Point hires 200 seasonal employees from all over the world each year. In 2021, he and his sister received the Hospitality Star of the Year award from the Michigan Restaurant and Lodging Association.

“As long as I have been here, Mark chooses to do the right thing. I have brought him a few sticky situations, and he always chooses to do what’s best for the team,” said Mission Point Controller Frank Bower.

Ware, who serves on the DEI committee of the Small Business Association of Michigan board, recently received its Political Impact award for his advocacy of the H2B visa program.

EMME ZANOTTI

Manager of Diversity, Equity & Inclusion

Ally Financial

Emme Zanotti joined Ally Financial as a senior analyst of Auto Finance Accounting and Securitization in 2017. e company promoted her to manager of DEI in 2022. Zanotti is responsible for a $3.7 million budget and the company’s DE&I Champion program, where she works one-on-one with executive leaders to implement the DEI strategy and “integrate an equity- rst mindset” into operations.

Zanotti’s big wins include increasing ERG membership and participation, implementing mental health programming, advocating for Ally to sign on to the Human Rights Campaign’s business coalition statements to support passing the Equality Act and standing against anti-LGBTQ+ legislation.

“In spite of the hectic, sometimes unnerving environment, Emme achieves strong results across the board. I continue to appreciate her conviction for the work and her ability to create safe spaces for all,” said Ally Chief Diversity O cer Reggie Willis.

Moreover, she came out as transgender to a previous employer and successfully advocated for the company to add LGBTQ+ identities to its anti-harassment and non-discrimination policies.

Zanotti is also chair of the #HateWontWin coalition and vice chair of the Michigan Democratic Party’s LGBT&A caucus.

Corporate Director and Senior Architect Albert Kahn Associates Inc.

LARGEST SE MICHIGAN EMPLOYERS

COMPANY NAME LOCATION CONTACT INFO

1 FORD MOTORCO.

1 American Road, Dearborn48126 313-322-3000;ford.com

2 STELLANTIS (FORMERLY FCA US LLC)

3

1000 Chrysler Drive, Auburn Hills48326-2766 248-576-5741;stellantis.com

GENERAL MOTORSCO.

300 Renaissance Center, Detroit48265 313-667-1500;gm.com

4 UNIVERSITY OF MICHIGAN , Ann Arbor48109 734-764-1817;umich.edu

5 BHSH SYSTEM 6 formichiganbymichigan.org

6 U.S. GOVERNMENT

7

477 Michigan Ave., Detroit48226 313-226-4910;usa.gov

HENRY FORD HEALTH

1 Ford Place, Detroit48202 800-436-7936;henryford.com

8 ROCKET COMPANIESINC. 1050 Woodward Ave., Detroit48226 313-373-7990;rocketcompanies.com

9 TRINITY HEALTH MICHIGAN

1600 S Canton Center Road, Canton48188 734-343-1000;trinity-health.org, .stjoeshealth.org

10 ASCENSION MICHIGAN 28000 Dequindre Road, Warren48092 866-501-3627;ascension.org/michigan

11 U.S. POSTAL SERVICE

1401 W. Fort St., Detroit48233-9998 313-226-8678;usps.com

12 STATE OF MICHIGAN 3042 W. Grand Blvd., Cadillac Place, Suite 4-400, Detroit48202 313-456-4400;michigan.gov

13

AMAZON.COMINC.

150 West Je erson, Detroit amazon.com

14 CITY OF DETROIT

2 Woodward Ave., Coleman A. Young Municipal Center, Detroit48226 313-224-3700;detroitmi.gov

15 UWM HOLDINGS CORP. (UNITED WHOLESALE MORTGAGE) 585 South Blvd. East, Pontiac48341 800-981-8898;uwm.com

16 DTE ENERGYCO.

17

One Energy Plaza, Detroit48226 313-235-4000;newlook.dteenergy.com

BLUE CROSS BLUE SHIELD OF MICHIGAN/BLUE CARE NETWORK 600 E. Lafayette Blvd., Detroit48226 313-225-9000;bcbsm.com

18 DETROIT MEDICAL CENTER 3990 John R, Detroit48201 313-745-5146;dmc.org

19

20

21

DETROIT PUBLIC SCHOOLS COMMUNITY DISTRICT 3011 W. Grand Blvd., Fisher Building, Detroit48202 313-240-4377;www.detroitk12.org

ILITCH HOLDINGSINC. 2211 Woodward Ave., Detroit48201 313-471-6600;ilitchcompanies.com

MAGNA INTERNATIONAL OF AMERICAINC.

750 Tower Drive, Troy48098 248-631-1100;magna.com

22 MCLAREN HEALTH CARE

One McLaren Parkway, Grand Blanc48439 810-342-1100;mclaren.org

23 WAYNE STATE UNIVERSITY

42 W. Warren, Detroit48202 313-577-2424;www.wayne.edu

24 COMERICA BANK

411 W. Lafayette, Detroit48226 248-371-5000;www.comerica.com

25 FORVIA NORTH AMERICA (FORMERLY FAURECIA NORTH AMERICA) 16

2800 High Meadow Circle, Auburn Hills48326 248-724-5100;forvia.com

TOP LOCAL EXECUTIVE(S)

JamesFarleyJr. president, CEO & director

FULL-TIME EMPLOYEES IN SOUTHEAST MICHIGAN JULY 2022

FULL-TIME EMPLOYEES IN SOUTHEAST MICHIGAN JULY 2021

WORLDWIDE EMPLOYEES JULY 2022/2021TYPE OF BUSINESS

47,750 e 47,750 183,000 1 186,000 2

MarkStewart COO, North America 42,444 37,761 NA NA

MaryBarra chairman and CEO 38,600 33,935 166,194 157,853

Mary SueColeman 3 interim president

35,620 35,185 51,979 4 51,426 5

Automobile manufacturer

Automobile manufacturer

Automobile manufacturer

Public university and health system

TinaFreese Decker president and CEO, BHSH System 21,674 NA NA NA Hospital system

NA 19,953 7 19,953 2,093,961 7 2,093,961

Federal government

RobertRiney 8 president and CEO 17,469 17,875 9 32,754 32,500 Health care system

JayFarner vice chairman and CEO DanGilbert chairman and founder

RobertCasalou president and CEO

JonathanNalli 10 interim ministry market executive, Ascension Michigan

14,109 18,000 23,000 26,000

13,186 e 12,991 9 NA 123,000 9

12,085 12,452 19,096 20,014

RichardMoreton district manager 11,680 7 11,680 e 640,000 7 640,000 e

FinTech platform company consisting of personal nance and consumer technology brands

Health care system

Health care system

Postal service

GretchenWhitmer governor 9,871 9,195 NA NA State government

AndyJassy 11 CEO Je Bezos executive chair and founder

9,567 e12 NA NA NA Ecommerce, tech and telecom

MikeDuggan mayor 8,942 8,563 8,942 8,563 City government

MathewIshbia chairman, president and CEO 8,058 9 9,126 8,058 9 9,126 Mortgage lender

Gerardo (Jerry)Norcia chairman, president and CEO 7,637 e 7,398 NA 11,366

DanielLoepp president and CEO 7,467 7,417 11,465 10,722

Energy company

Nonpro t mutual insurance company and subsidiary companies

BrittanyLavis CEO 7,294 9 8,338 9 7,294 9 8,338 9 Health care system

NikolaiVitti superintendent 6,665 13 6,892 13 6,665 13 6,892 13 Public school system

ChristopherIlitch president and CEO 6,253 e 6,000 e NA 24,000 e

SwamyKotagiri CEO 5,492 4,637 161,000 154,000

PhilipIncarnati president and CEO 4,824 5,340 19,982 23,719

M. RoyWilson 14 president 4,468 4,668

MikeRitchie executive vice president, head of national and specialty businesses 4,155 4,254

NikEndrud executive VP North America

Food, sports, entertainment and real estate development industries

Mobility technology

Health care system

Public university

Financial institution

7,424 7,527

2023.

Faurecia's

16 | CRAIN’S DETROIT BUSINESS | OCTOBER 3, 2022 ResearchedbySonyaD.Hill:shill@crain.com |ThislistofSoutheastMichiganemployersencompassescompanieswithlocationsinWayne,Oakland,Macomb,WashtenaworLivingstoncounties.Numberoffull-timeemployeesmayinclude full-timeequivalents.Itisnotacompletelistingbutthemostcomprehensiveavailable.Unlessotherwisenoted,informationwasprovidedbythecompanies.Companieswithheadquarterselsewherearelistedwiththeaddressandtopexecutiveof theirmainDetroit-areao ce.Actual guresmayvary.NA=notavailable.NOTES: e. Crain'sestimate. 1. FromForm10-KendingDec.31,2021. 2. FromForm10-KendingDec.31,2020. 3. SucceededMarkSchlisselafterhewas redonJan.15.Santa Onotobegina ve-yeartermastheuniversity'spresidentonOct.13 4. Includesapproximately15,600in-statepart-timeemployees. 5. Includesapproximately15,000in-statepart-timeemployees. 6. BeaumontHealthandSpectrumHealthmerged asanintegratedhealthsystemwiththetemporaryname,BHSHHealthonFeb.1. 7. AsofJuly2021. 8. NamedpresidentandCEOonSept.8.PreviouslyservedasinterimCEOafterWrightLassiter'sdepartureinAugust. 9. AsofJanuary. 10. Succeeded JosephCacchioneinAugust. 11 SucceededJe BezosasCEOinJuly2021. 12. EstimatebasedonnumbersfromMWPVLInternationalInc. 13. FiguresareFTEcountsfromtheCenterforEducationalPerformanceandInformation. 14. Willstepdown

Bill seeks to tamp down travel nurse industry costs

DUSTIN WALSH

Michigan is joining at least 15 oth er states in an attempt to tamp down the high costs of contract travel nurs es, even as demand for health care workers continues to grow post-pan demic.

Earlier this month, Republican Rep. Sarah Lightner introduced House Bill 6364, which would limit travel nurse agencies to charging hospitals no more than 25 percent above what the agencies pay their nurses.

e intention of the legislation is not to punish nurses, but to limit how much money these contracting agen cies can make o them, Lightner told Crain's.

e health care industry says travel nurse agencies exploited the pan demic for billions of dollars. at gold rush is largely over as the pan demic has settled down, but now many states want to prevent a repeat as the industry struggles to make ends meet in a post-pandemic world.

ere are plenty of challenges ahead. Legislators are running out of time as only a few legislative days re main ahead of the November elec tion. At the same time, experts are questioning whether the law would even be e ective at reducing costs.

Crain’s reached out to nearly a dozen national and local travel nurse agencies and did not receive a call back.

Travel nurses made headlines across the U.S. during major surges of the COVID-19 pandemic as many nurses quit their jobs for short-time contract work through an agency where they could double or even tri ple what their counterparts em ployed directly by health systems were earning.

Locally, travel nurses were making as much as $5,000 a week, or as much as $100 an hour, as hospitals and nursing homes struggled with sta ing shortages during the pandemic.

e sta ng agencies reportedly were charging facilities as high as $200 per hour.

Local hospitals and health systems saw labor costs rise rapidly — travel nurses made up 39 percent of hospi tal nursing budgets in January of this year, up from just 5 percent in 2019, according to the American Hospital Association.

Friends to foes

Sta ng remains a critical issue for hospitals and nursing homes across the country, pushing pro t margins into negative territory for an im

STAFFING

From Page 7

time-consuming tasks that would otherwise be required of nurses and support sta , thereby freeing them to spend more time at the patient bedside and Virtual Nurse & Partners in Care, which utilizes a virtual nurse and partners in care for purposes of safety surveillance, assessment, education, coordination of care, and

mense numbers of facilities.

An analysis released earlier this month by the AHA said more than half of all U.S. hospitals are losing money in 2022, with projected mar gins down between 37 percent and 133 percent compared to before the pandemic.

Expenses for health systems are projected to increase by nearly $135 billion in 2022 over 2021 levels, large ly due to labor costs. e AHA analy sis projects labor costs to rise by more than $57 billion over last year with contract labor accounting for more $29 billion of that total. Con tract labor costs are 500 percent higher than before the pandemic, the analysis said. e remaining costs are attributed to equipment costs due to in ation.

Lansing-based Sparrow Health has seen labor costs rise more than 22 percent this year to a projected $832.3 million from $682.1 million in 2019. Contact labor there has risen 369 percent to $50.2 million this year. Overall labor costs at Michigan Med icine are up 18 percent since 2019, the health system told Crain’s in an email.

Many nurses were departing health systems and then returning for a much higher wage as a travel nurse.

Rep. Lightner said the legislation came at the behest of Michigan’s nursing home industry, which has arguably been hit hardest by labor challenges. Albeit, many of those la bor challenges occurred due to his

communication between patients, signi cant others and their caregiver.

Schwartz: “No, the challenges have not eased. The pandemic took a toll on health care workers across the world and demands continue today. We are looking for creative solutions to ease burnout including ways to support and recognize our incredible team members. We are o ering more exible work schedules and bene ts packages, and numerous training and learning

torically low pay and bene ts.

“In talking to some nursing home facilities, they are struggling to nd workers,” Lightner said in an inter view with Crain’s. “ ey are put in a place where they are not able to com pete due to the additional dollars put on by headhunters. is (legislation) should bring some of that in line.”

e legislation is currently with the Health Policy and Human Services committee.

Warning shot?

But the legislation attempts to toe a line where it does not diminish the bene t to nurses who choose an agency job to earn a better living while also pinching the margins on the agencies.

Mark Kopson, partner and chair of Plunkett Cooney’s health care prac tice, said the proposed legislation may be a “tempest in a tea cup.”

" e industry is challenging that the agencies are engaging in an ti-competitive behavior, not by a mo nopoly but in cornering the market during a vulnerable time,” Kopson said. “ e approach is to put a cap on the pro t margin of the agency. Oth er states that are introducing similar legislation are instead capping mar gins tying the what an agency can charge on the prevailing market rate for nurses based on geographics and position. Michigan’s legislation is less tied to the market and there’s no guarantee agencies will reduce what

opportunities. In addition, we o er a robust employee wellness program for all our team members.”

 What percent of jobs remain open at your organization?

McNeil: “We have roughly 2,800 open positions, which equates to roughly 8 percent (at Trinity Michigan).”

Schwartz: “Approximately 10 percent at Beaumont Health.”

they charge.”

H.B. 6364 regulates that an agency can only charge a facility 25 percent more than it pays its contract nurse. So an agency charging a nursing home $125 for contract labor, they must then pay the nurse $100 of that hourly fee. Agencies may choose to continue to charge as much as possi ble to maximize their margin even un der the law. And in return, that could raise pay for travel nurses even higher.

Melissa Samuel, president and CEO of the group that helped author the legislation, the Health Care Asso ciation of Michigan, said the legisla tion is designed as a shot across the bow of the travel nurse agencies.

“Our legislation is nuanced be cause we didn’t want to cap what the employees can make,” Samuel said. “We’re really just dipping our toes in on this to get a dialogue started. We need framework around a regulatory structure for these companies. It is clear we need to do something here and getting what is happening exposure is part of it.”

HCAM represents the state’s longterm care providers, including forand not-for-pro t, county medical care, hospital-based providers and assisted living communities.

Runaway gurney

Minnesota and Massachusetts are the only two states currently with a law capping travel nurse agency rates.

 Do you think the situation will improve in 2023?

McNeil: “We remain optimistic that our sta ng situation will improve with our focused e orts on innovative models of care, exible work schedules, alternative ways to work, workforce development and many other programs that directly support the attraction and retention of colleagues. We have a strong culture and mission and continue to be proud of all 24,000

e Minnesota law, passed in 2001, bars an agency from charging more than 150 percent of the average hourly wage of an employee in that role. During the pandemic, the state did al low for agencies to apply for wage cap waivers. Massachusetts has an overar ching anti-price gouging law that ap plies to services like nurse agencies, but in May 2020 raised the cap agen cies could charge by 35 percent.

Several other states, including Pennsylvania, Illinois and Connecti cut, are considering similar legisla tion. And hospital and nursing home associations are all putting pressure on Washington D.C. to act.

In February, the AHA and 200 oth ers urged U.S. Congress to use its fed eral powers to investigate travel nurse agencies for “price gouging” and other anti-competitive practices.

“ e conduct of some of these sta ng agencies bears all the hall marks of widespread collusion and perhaps other abuses,” the letter read. “Preventing sta ng agencies from exploiting hospital and health systems’ need for providers would help mitigate some of the nancial and operational pressures currently facing hospitals and allow them to continue focusing on critical care for patients.”

e Michigan Health and Hospital Association supports the proposed Michigan legislation.

“ e MHA supports HB 6364 be cause it would help to address exor bitant contract labor expenses that threaten the nancial sustainability of hospitals,” it said in a statement on its website.

Health systems believe the nan cial viability of their entire industry is at stake given a projected shortage of 450,000 registered nurses alone in the next three years, according to a recent report from McKinsey & Co. And with more and more nurses reaching retirement age, the facilities don’t want to compete, or aren’t able to, with travel nurse agencies. e fear is too many patients, too few nurses and, ultimately, a reduction in quality of care.

“We’re seeing double-digit increas es in costs at long-term care facilities and wages are the number one drive of that,” Samuel said. “Sta ng agen cies are just a part of that picture but it’s just not sustainable. We need to do everything we can to attract workers back to the sector, and we can’t do that under these costs.”

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

caregivers for being a transforming, healing presence in the communities we serve.”

Schwartz: “We are putting a lot of things in place to address the issues now and in the long term so we can continue to provide excellent health care and coverage for our patients, members and communities.”

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

The health care industry says travel nurse agencies exploited the pandemic for billions of dollars. That gold rush is largely over as the pandemic has settled down, but now many states want to prevent a repeat as the industry struggles to make ends meet in a post-pandemic world. BLOOMBERG

At least 15 other states have laws that limit costs for contract help

“WE NEED TO DO EVERYTHING WE CAN TO ATTRACT WORKERS.”

—Melissa Samuel, president and CEO, Health Care Association of Michigan

VOUCHERS

From Page 3

Next month, the amount of money landlords can get will increase. HUD recently announced it was raising fair market rent rates by an average of 10.3 percent across the state, includ ing by 11.9 percent in metro Detroit and 9.7 percent in Ann Arbor. at puts rates at $1,213 a month for a metro Detroit two-bedroom apart ment and $1,384 for a two-bedroom apartment in Ann Arbor.

Nationwide, there's an increase of 10.4 percent, on average. Since 2016, HUD said, the annual increases have been around 4 percent.

e voucher program uses federal HUD dollars to pay private landlords rent, covering some or all of the cost of housing for low-income families, the elderly and the disabled. ere is high demand for the program, and local wait lists — some of which have thousands of people on them — have largely been closed for years.

Housing providers have leeway to spend their funds on housing vouch er recipients up to 110 percent of the federal measure, which is an esti mate of how much it would cost to cover both rent and utilities on rent als in an area at or below the 40th percentile in costs. But the extra 10 percent Kemmis is using required special permission, and she's hoping for continued approval, even with the large increase in rates.

"Another 10 percent, we see it giv ing our families a better opportunity to access a ordable housing," Kem mis said.

When the new rates go into e ect Oct. 1, Kemmis said they will help provide leeway for about 2,500 fami lies — including about 500 in metro Detroit — that have received housing vouchers, but are still looking for places to use them. ere are about 27,700 housing vouchers in use state

wide, MSHDA said, including about 8,000 in Wayne County.

But the more she spends, the fewer families can be served.

In Ann Arbor, where rents can "wild ly exceed" 110 percent of the fair mar ket rent, Jennifer Hall, the executive director of that city's housing commis sion, said she's started to intentionally

spend more money than she has. She already can't use close to the 1,938 vouchers she has access to, and with 20 percent of tenants who have vouchers unable to nd housing, Hall said she regularly exceeds her allotment in the hopes that HUD will use money other areas haven't spent to cover the gaps.

" ey don't promise they have

enough money," she said of the gam ble. " e rst year, I was scared to death."

But now, she said, it makes sense from a strategic perspective to show the need — and hope the funding fol lows. is year, it did and funds were increased midyear for Ann Arbor and other housing authorities, Hall said.

Additionally, HUD announced ad ditional vouchers and funding last month — Ann Arbor will receive funding for an additional 16 vouch ers; there are more than 500 new vouchers being funded in Michigan.

e wait list for access to Ann Arbor housing vouchers was last open in August 2020; there are about 2,900 people on it.

ere are other ways to try to make the math work. Both Hall and Eboni Nugin, the executive director of the River Rouge Housing Commission, said they try to negotiate rents down with landlords. Nugin has some luck, she said, when there's less than a $100 gap between the asking rent and what vouchers can cover — hers are also at 110 percent of the federal gure; she moved the numbers up months ago when participants were having trouble nding apartments.

Of River Rouge's 253 vouchers, about 185 are in use, with more than 700 on a wait list that was last open in 2018. Nugin said she's wary of further adjusting payments to cover the higher rent numbers because there's so far no guarantee that she'll get more money from HUD to pay for the increase — and she doesn't want to leave people in the lurch.

"We're still balancing how much we can help," she said. "We have yet to receive anything from HUD to get more dollars. Until we get that, we're not moving."

A HUD spokesperson said the availability of money came down to congressional appropriations.

" e lack of funds means it poten tially doesn't matter," Hall said of the

new gures. "It still doesn't mean people can nd a place to live."

In Detroit, the 3,000-person wait list last opened for 72 hours in Febru ary 2020. Sandra Henriquez, CEO of the Detroit Housing Commission, said 22,000 households applied for a spot. A lottery winnowed the list down, she said, so those remaining might have a chance to get help.

"People sit forever, and that's just not fair," she said.

Now, there are about 400 Detroit residents who have vouchers and are looking for housing; Detroit also of fers 110 percent of the fair market rent gure.

e goal, she said, is to have new voucher recipients using the subsidy within 60 days — but it often takes longer than that to nd a home.

Rent negotiation with landlords who are willing to cooperate can take time, Henriquez said. e new g ures might give her more exibility in coming to agreements with potential landlords, where gaps can be several hundred dollars.

While she said some voucher own ers are willing to help cover the gaps out of their own pockets, the system doesn't allow it. To do so would mean tenants become rent burdened, she said, and are more likely to miss rent payments, negating the bene ts of the aid.

Henriquez said there's a gap of about 1,400 between the number of vouchers she's allowed to give out and the number she has the money to fund. ere are penalties, she said, to overspending. And landlords after the rst year are eligible to apply for rent increases, further eating into the available pot.

" ere's just not enough for peo ple," she said. "Having fair market rents go up, getting more vouchers on the street is exactly what's needed."

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

sage oils and lubricants.

Most of the sta , with the excep tion of some warehouse employees, have been retained, adding 42-50 employees to the Lover’s Lane ros ter. A Cleveland distribution center has been closed, with operations moving to Michigan, Allmond said.

“ ere’s been some attrition be cause some people don’t like change,” he said. “We had to replace some people, but the positions remained intact.”

Lover’s Lane now has 294 employees. As the holi day season approaches, that number will jump to 325, according to Allmond.

e busiest time of year for the company is Valentine's Day, followed by Halloween, Christ mas and Sweetest Day.

"Halloween is big because people like risqué costumes and provoca tive accessories," Allmond said.

e recent expansion signals a business founded in 1992 on solid footing.

Across all categories, Lover's Lane has evolved to o er items of better quality with a strong focus on sexual wellness — helping customers in spire a positive, respectful approach involving sexuality and sexual rela tionships, according to Allmond. Items from the Womanizer brand are big, he said, and CBD is now in cluded in some Lover's Lane mas

e women's lingerie market is projected to surpass $78 billion by 2027, more than twice that of 2018, according to a study conducted by e Insight Partners. e industry has changed over the years, with lingerie now a form of outerwear, with leather harnesses and bustier tops found on fashion runways and on the streets.

"By incorporating these trends into our selection, we can wardrobe our customers in the bedroom and out," Allmond said.

Lover’s Lane projects $40 million in revenue for 2022.

e privately owned com pany did not disclose previ ous years' revenue, but All mond said revenue has increased by more than 20 percent since the start of the COVID-19 pandemic.

Allmond said the pan demic gave those who were locked down an opportunity to relight a re that may have burned out.

"I think the reason we were so suc cessful during the pandemic is be cause Lover’s Lane was the next best thing to a vacation," he said. "Restau rants were closed, you couldn't trav el or go on vacations, yet you could shop at Lover’s Lane, have a pizza delivered, and enjoy intimacy and rekindle your love life behind closed doors in the bedroom."

Still, there were some challenges. Early in the pandemic, Lover's Lane was unable to open 10 of its then-33 stores due to safety concerns raised by sta . e company temporarily

closed all of its stores and laid o 265 employers, keeping on just ve to work remotely. e stores were closed for 80 days in 2020 before re opening June 9 with reduced hours.

Now business is strong despite what some would call an antiquated model: Lover’s Lane does 97 percent of its business in-store.

“ ere’s so much competition on the internet. Most people don’t un derstand that places like Target, Walmart and Walgreens all sell linge rie and romantic gifts,” Allmond said. “We’re competing with a lot of out lets. We’ve been doing the web since 1998. Our heyday on the web was before we had so much competition.” at competition isn’t hurting Lover’s Lane’s business strategy. e company has plans to expand into another undisclosed market that Allmond said “will be a good mar

riage for the company.”

One other thing that’s helped sales recently is a new Net ix show titled, “How to Build a Sex Room.” Allmond said customers over the past couple of months have come in to stores and asked for furniture and items featured in the show, includ ing bedroom toys, fetish items and bondage gear.

It’s not the rst time an entertain ment property has helped spike sales.

“You can’t project things like that. People really like that stu ,” All mond said. “Who knew Net ix would spur so much activity for our space? e same thing happened when 'Fifty Shades of Grey' came out. You never know who or what’s going to help your business.”

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

VC MARKET

From Page 6

U.S. venture capitalists last year in vested $329.9 billion across an esti mated 17,054 deals, according to a year-end report from Pitchbook and the National Venture Capital Associ ation. Some 730 U.S. VC funds last year raised a record $128.3 billion, a 47.5 percent year-over-year increase compared to 2020’s record of $86.9 billion, according to Pitchbook and the NVCA.

So given the record-setting year, yes, things have slowed by most ac counts. But that’s probably for the best, said Erik Gordon, a nance pro fessor at the University of Michigan’s Ross School of Business.

“I don’t think it’s so much that the VCs now have control,” Gordon said. “I think it’s more that it’s gone back to normal. e best-looking companies get higher valuations and the not-sogood-looking companies that are fundable get lower valuations.”

Put another way: e frothy days of 2021 when a web3 startup could command a $1 billion-plus valuation just because they said they were in the sector du jour are largely over.

Some level of “sanity” has returned to the marketplace, said one VC source.

And regardless of which party may have the upper hand at the negotiating table, that’s something to celebrate.

Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes

The Brush Watson development in Brush Park, where representatives from the City of Detroit and various stakeholders and developers met Wednesday to discuss additional funding for low-income housing units. | PHOTOS BY ARIELLE KASS/CRAIN’S DETROIT BUSINESS

Detroit Mayor Mike Duggan (at podium) and several members of City Council and other o cials announce a program to boost the number of available housing units in the city in July 2022.

LOVER’S

Plymouth-based Lover’s Lane has expanded into Ohio by purchasing seven properties from Cleveland-based Ambiance, Inc. | LOVER’S LANE

Allmond

“People are going to leave.”

e 2021 American Community Survey showed exactly that, she said, with Detroit losing as many as 17,000 households.

“We’ve got to stop the bleeding on that. We are not a place (that) Black middle-class households see as a place where they want to invest and grow their own income,” Goss said.

Early e orts

e Detroit Future City strategic framework, a 50-year blueprint for Detroit, was made public in January 2013 after two years of research and community input. Largely funded by the Troy-based Kresge Foundation, the resulting, 349-page plan focuses on job growth, land use, improving neighborhoods and rebuilding infra structure in the city.

neighborhoods and rebuilding in frastructure in the city.

Following its release, Kresge made a ve-year, $150 million commitment to supporting its recommendations.

Early e orts to turn the plan to ac tion focused on converting vacant land into farms and green space, job creation and stabilizing hard-pressed city neighborhoods.

After operating as part of the Detroit Economic Growth Association for the rst few years, the e ort spun o as an independent nonpro t in late 2015 and named Anika Goss to lead it.

Goss “has sharpened DFC’s focus on equity, as well as created the re search heft to help Detroiters under stand and measure our progress to wards an equitable and inclusive, revitalized city,” said Wendy Lewis Jackson, chair of the DFC board and managing director of Kresge Founda tion's Detroit program.

Under Goss’ leadership, DFC estab lished the Center for Equity, Engage ment, and Research which has pro duced 30 studies and reports to date, on Detroit’s mortgage originations in dustry, entrepreneur perceptions, transit, Detroit’s rental housing mar ket, green infrastructure, vacant indus trial sites and middle-wage job market.

Its e orts have attracted annual operating support since the begin ning from Kresge,and other funders are now supporting the work, includ

ing the Fred A. and Barbara M. Erb Family Foundation, Hudson-Webber Foundation, Skilllman Foundation, United Way of Southeastern Michi gan and W.K. Kellogg Foundation.

Today, DFC operates on a budget of about $3 million, with a 17-member team focused on the research, com munity and economic development and land use and sustainability and convening cross-sector coalitions

working on Detroit’s housing ecosys tem and environmental sustainabili ty. It plans to add as many as ve new employees by next year, Goss said.

DFC’s research will continue. But it will also play a more active role in implementing strategies to grow the city’s middle class through expanded convenings of key groups and new advocacy and policy e orts around areas that impact Detroiters’ ability

to prosper, including jobs, housing and home ownership, Jackson said.

Growing Detroit’s middle class

With its 2019 report, DFC was among the rst to sound the alarm on the need for growing the city’s middle class, Jackson said.

Over the past decade, Detroit has seen new commercial investment and development, rebounds in hous ing values and mortgage lending, riv erfront and neighborhood greenway enhancements and new green infra structure and community-developed open-space projects.

Yet, economic and racial dispari ties in jobs, income, housing and op portunity persist in the city, DFC said, with a lack of middle-wage jobs for Detroiters; persistent, concentrat

ed poverty, a loss of middle-class neighborhoods and increased im pact from climate change manifest ing as signi cant ooding in Detroit neighborhoods.

Households of color, which make up over 90 percent of the city’s popu lation and have been subjected to historic and ongoing patterns of rac ism that limit their economic oppor tunities, DFC said. About 75 percent of those Detroit households earn less than $50,000 per year.

DFC will measure its progress on growing the city’s middle class among people of color by looking at factors like the number of Detroiters holding middle-wage or better jobs, owning homes and businesses. It will also track other data including the number of majority, Black mid dle-class neighborhoods and the number of land use projects that contribute to health, well-being and climate resilience in the neighbor hoods and city as a whole.

rough its research, DFC has found “that a major existential threat, if you will, to the city’s prosperity is lack of a growing middle class,” Jack son said.

“Having a greater middle class in the city will help stabilize its econo my and growing the city’s population by keeping folks in the city and demonstrating improved quality of life for new residents.”

DFC is likely to begin expanded ef forts in neighborhoods where it has already been focusing, like East Ferry Warren, Elmwood Park and McDou gall Hunt. But will also be open to other neighborhoods looking for change, Goss said.

It’s working in the East Ferry War ren neighborhood, now, helping it to build an urban forest to anchor other green amenities including a commu nity garden, meadow and tree farm.

“Being able to combine that e ort that green e ort with new communi ty development, so housing, com mercial retail, in that neighborhood, imagine what the back could do to the neighborhood for the existing residents,”she said.

“ at’s the kind of neighborhood that you would want to live in if you were surrounded by green and beau ty, but you also have amenities and services just like everyone.”

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

"We would love for it to be an Equinox," Cantor said. "We are just working through that as part of our evaluation. It's in the running, for sure, absolutely."

Construction on the proposed $190.5 million hotel with 290 rooms is expected to begin in the third quarter 2024 and take approximately three years to complete.

Earlier this month, the Downtown Development Authority signed o on a development agreement for the hotel, which would stand 180 feet tall and include 30,000 square feet of amenities and retail space.

e development agreement says the developer expects to apply for public incentives for the project, which it says are necessary for it to be economically viable.

Olympia and Related will be man aging members of the developing entity and contribute equity to the project, the development agreement says.

A copy of the project budget says the construction would cost $137.3 million, with architecture and engi neering costs totaling $13.4 million; project management, developer fees, legal fees and other fees costing $11.6 million; permit and utility fees costing $2.47 million; leasing and marketing fees costing $5.18 mil lion; nancing costing $6.7 million; and contingency costs of $13.8 mil lion.

In December 2019, Olympia re ceived a three-year extension to sub mit a development proposal for the hotel property on Woodward Avenue south of the arena in exchange for about $500,000 in land to be used as park space. e original deadline was June 28, 2019, but Olympia failed to submit a development plan by that deadline and was in viola tion.

Olympia and Related have joined forces in the last year to work on projects in the Ilitch family's District Detroit area, primarily the Detroit Center for Innovation graduate school campus for the University of Michigan, which received a $100

million budget earmark from the Legislature during the state budget process; Ross is also contributing $100 million to the project, which is expected to start construction by the end of 2023.

Earlier this year, Related and Olympia unveiled a series of revived visions for new and redeveloped buildings.

For years, the District Detroit proj ect as it was originally proposed in July 2014 lagged expectations, par ticularly with regard to housing, al though some apartments have come online in the former Hotel Eddys tone in the last year and construc tion began earlier this year on the United Artists Building into about 150 apartments.

In addition, Bradford said Wednesday that construction on a series of redeveloped apartment buildings at Cass Avenue and Henry Street is expected to begin early next year, bringing about 170 apartments to the area.

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

at

Detroit Puppet Theater, a 2019 Working With Lots grantee, hosts an an outdoor theater show. | DETROIT FUTURE CITY

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Goss Lewis Jackson

SHIPPING

From Page 1

e exorbitant cost of ordering freight from overseas had an upside for American Plastic Toys, which sources most of its materials domes tically and manufactures in Walled Lake and Mississippi. President John Gessert said the company avoided logjams at the ports, putting it in a stronger position to capitalize on booming demand than some of its import-heavy competitors.

It no longer has that advantage and is now struggling with domestic delivery price hikes, Gessert said. While domestic carriers such as Fe dEx and UPS have increased rates by at least 6 percent this year and indi cated another hike for next year, Ges sert said his customers are also slap ping on surcharges to loads that he has no choice but to accept.

“ ey’re just deducting it. It’s non-negotiable,” said Gessert, whose customers include big-box retailers throughout the U.S. and Canada.

“ ere’s really no easy way to antici pate what that is, and boom, they just take it. e bigger customers can do that, and you can ght till you’re blue in the face.”

e average cost for American Plas tic Toys to move goods in the U.S. in creased by 40 percent year-over-year, according to Gessert. e cost to move product on lanes to the western part of the country nearly doubled.

Increases were even more dramat ic in Canada, where a soon-to-end vaccine mandate for truck drivers drove up delivery costs — in some cases tripling them, Gessert said.

He said that just this week a major U.S. retailer, who he declined to name, subtracted about $4,000 from its payment to the company with a “freight ow through charge” based on increased fuel prices. Gessert’s options were grin and bear it or nd a new buyer.

“I’m not quite sure how that be comes our responsibility because that’s the cost of doing business that

DOWNTOWN

From Page 1

downtown that have struggled with less than half the downtown core's o ce population back.

But when met with resistance from some calling it abrupt and misguided, GM softened its posi tion just a few days later, no longer saying it would require a certain number of days back at the o ce and that its "Work Appropriately" policy would not be adjusted before 2023.

A day after that, it was revealed that Meridian Health, a major em ployer in a pair of downtown o ce buildings, is looking to shed more than 300,000 square feet of prime space in One Campus Martius and One Kennedy Square.

Two steps forward, and one step back.

at's a key indicator that Meridi an Health, which is owned by St. Louis-based Centene Corp., does not believe it will need that space beyond the terms of its existing leases in the two buildings — a blow both to the businesses those Merid ian employees once supported, as well as a blow to the buildings' land lords which will seek to nd some one else to occupy those big chunks of space when few o ce users of that size are to be found.

Ocean shipping costs

$12,000

$3,300

of the nation’s GDP, the highest since 2008.

However, heftier pro ts for logis tics rms came with higher labor and fuel costs, which have remained up despite uncertain demand.

ing and inventory are relatively sta ble, but it’s demand he worries about. Some customers are pulling back on orders, while others are stocking up as usual to avoid shortages like a year ago.

“Last year at this time, people were clamoring for product because you couldn’t get product into the coun try,” he said. “You have retailers now that are really concerned about what a recession is going to do to their vol ume and how it’s going to a ect con sumer demand. at’s yet to be seen, but I think it’s going to have a nega tive e ect.”

MyLocker said its direct-to-con sumer business, driven by custom school and sports team clothing, has rebounded since the pandemic shut down schools and sports, resulting in higher pro tability. Its most pressing challenge now is trying to ll 200 open jobs in Detroit for the hiring season, Kendall said.

"You're ghting di erent ghts," he said. "Maybe where we were try ing to gure out contingency plans for shipments that weren't going to be here and backup sources of sup ply, some of the energy that was fo cused there last year is focused on some of these other initiatives."

While MyLocker and American Plastic Toys deal with a varying mix of input costs, any price increases ul timately fall on the consumer.

"We do pass along price increases that we get from our suppliers, and we’ve been generally successful in doing that, but those aren’t always easy conversations," Kendall said.

they should be anticipating and working into their retail,” he said. “It was very disappointing.”

e surprise surcharge on the toy company underscores the continued volatility in the supply chain, accord ing to experts.

Road freight, the largest segment of expenditure for U.S. companies, rose 23 percent to $831 billion, ac cording to a recent study commis sioned by the Council of Supply Chain Management Professionals. Logistics costs represented 8 percent

“ e logistics sector must simulta neously contend with the hangover of red-hot demand and worries of a reve nue-diminishing and inventory-swell ing downturn,” the report said.

A year ago, Gessert was struggling to nd workers and couldn’t make enough toy trucks and kitchen sets to meet demand. Now, he said his sta

For example, American Plastic Toys has increased the wholesale price of its popular Gigantic Dump Truck by 15 percent to around $30, which is then hiked up at the retailer's discretion, Gessert said. He is consid ering increasing the price more to make up for all the surcharges.

"You're going to have to increase your prices if they're going to keep charging you after the fact," he said.

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

Still a struggle

e Sept. 23 news of GM's pend ing return — bringing perhaps a few thousand workers back downtown three days a week — was welcome to restaurant owners who have cut hours and other small business own ers still feeling the pinch brought on by the 2 1/2 year old global health crisis that upended virtually every facet of the economy.

Yet by Sept. 27, the automaker did somewhat of an about-face, modify ing its return-to-the-o ce plans fol lowing backlash, leaving those small business owners waiting longer for their more regular patronage.

In addition, Meridian Health, fol lowing the lead of its parent compa ny Centene thats shedding o ce space writ large, is giving back 40,000

square feet in the Redico LLC-owned One Kennedy Square and 266,000 square feet in One Campus Martius, which Bedrock and Meridian bought jointly in 2014.

Redico declined comment Wednes day; Bedrock and Meridian did not re spond to emails seeking comment and additional information.

e Downtown Detroit Partner ship, which on Wednesday held its fall stakeholder meeting, says that pre-pandemic, the median number of o ce workers downtown was 70,629; in 2021, that was just 17,512.

While the average number of of ce workers per day has been gener ally creeping up this year — going from 18,791 in January to 27,765 in July — that still pales to 2019, which hit a low of 60,913 per day in July that year but had 75,281 per day in Octo ber 2019.

A harbinger

e Meridian subleases are hefty blows for its two landlords on Cam pus Martius Park.

One Kennedy Square is about 247,000 square feet, and a 40,000-square-foot loss amounts to about 16 percent of its total square footage, according to data from Co Star Group Inc., a Washington, D.C.based real estate information service.

One Campus Martius is approxi mately 1.3 million square feet fol

lowing a more than 300,000-squarefoot addition that was completed recently, making Meridian's sub lease space about 20 percent of the building's footprint.

While Cushman & Wake eld bro kers could nd one or more tenants to eat up that abandoned square footage, o ce users of that size have been hard to come by.

Meridian is still on the hook to pay rent in the buildings — unless it ter minates the leases and pays a onetime termination fee — through the end of 2025 for One Campus Martius and 2024 for One Kennedy Square.

But subleasing is generally con sidered a harbinger of things to come.

While Meridian could temporarily vacate the sublease space, ll it up with someone else until the lease ends, and then ultimately opt to re new once that happens — that's un likely. Brokers view subleasing as a sign that the company putting the space out has no more use for it, and will not renew.

Ultimately for those two buildings, the pain may come at the expiration of the Meridian leases — and the landlords are left with big blocks of empty space that once contributed to their cash ow.

According to commercial mort gage-backed securities data posted to CoStar, One Kennedy Square has a $36.4 million loan that matures in

February 2028; the loan is current. Net cash ow was $3.62 million last year, down from 2020 ($4.19 million) and 2019 ($3.94 million).

One Campus Martius, which was purchased with a $125 million CMBS loan in 2014 that was paid o in late 2019, currently has a $50 million CMBS loan on it that was originated in July. It matures in July 2032.

e broader trend points to o ce rents downtown softening, one longtime expert said.

Over the last decade-plus, land lords — primarily Dan Gilbert, but a small handful of others — have pur chased a slew of downtown o ce buildings, pumped millions into renovating them, leased them up to tenants and began jacking up rents from the high teens to, in some cas es, the upper $20s and low $30s per square foot, said Steve Morris, man aging principal of the Farmington Hills-based tenant representation rm Axis Advisors LLC.

But with lease rollover from that period coming up and landlords looking to lure users to replace ones who ed — small legal rms and nonpro ts, to name a few — expect rents to fall, Morris said.

"Clearly rental rates in the (central business district) will be decreas ing," he said.

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

The worst of the supply-chain crisis may be over, but the problems haven’t gone away for the neighborhood surrounding the US’s busiest ports near Los Angeles. | BLOOMBERG

“YOU’RE GOING TO HAVE TO INCREASE YOUR PRICES IF THEY’RE GOING TO KEEP CHARGING YOU AFTER THE FACT.”

—John Gessert, American Plastic Toys

The One Campus Martius building in downtown Detroit. | COSTAR GROUP

BOXING

From Page 1

“ e whole dream is to go global with this, to help as many kids as pos sible. at’s always been the dream since the beginning. ere are peo ple who need the help all around the world, not just in one spot,” said Kha li Sweeney, DBG’s founder and CEO.

DBG teaches “books before box ing.” It's something Sweeney learned rst-hand.

When he dropped out of school in 11th grade, he was illiterate. But a few years later, as he saw kids from his neighborhood killed or jailed, he knew he had to make a change. Sweeney got a construction job and taught himself to read. Savings from his job enabled him to launch the DBG program in 2007, but the money ran out after a few years.

He met Jessica Hauser in 2010 who helped cover costs when she learned the gym was struggling and helped to boost funding from corporations, foundations and celebrities, enabling DBG to move into its current site. She's currently the executive director.

e nonpro t hires certi ed teach ers to help kids master the basics: reading, writing, math, science and social studies. It also exposes them to computer coding, ber optics, robot ics/engineering, cooking, music, com munity service and other programs.

In 2013, DBG began working with Amanda Case, assistant professor of counseling psychology in the De partment of Educational Studies at Purdue University to gure out what makes its program e ective. It has been working with the organization and its students ever since to main tain individualized programming for students and to re ne and build the program, Case said.

DBG’s impact stems from the fact that it provides high-quality, multi faceted, individualized program ming in a safe, caring, and accepting climate, she said.

e safe, caring and accepting en vironment at DBG is the truly im portant part, Case said.

“ e bene ts wouldn’t be possible outside of the welcoming and accept ing climate of the gym, the trust that is established between gym sta and stu dents and their families, and the sta ’s wholehearted belief in the greatness of all their students. Within that context, students are able to let their natural strengths and talents out.”

Grassroots nonpro ts can struggle to ensure their missions live on be yond their founders, but DBG is look ing to ensure the magic continues, even when Sweeney departs.

With a $500,000 grant from the Ralph C. Wilson Jr. Foundation, DBG began in 2018 training youth in the program to emulate Sweeney’s style as a leader, mentor, life coach, athlet ic trainer and, often, a surrogate fam ily member.

For those e orts, DBG was named a nalist in Crain’s Best-Managed Nonpro t contest in 2019.

Local growth

With a waiting list of 1,000 or more kids waiting to get into its program, most from Detroit but some from neighboring communities like Dear born, DBG is planning its rst expan sion in its own backyard.

It recently completed $3 million in capital improvements in its longtime home, a former book-binding factory on Detroit’s east side in the Island view neighborhood. Projects in the building, located on East Vernor Highway between Meldrum and

Beaufait streets, included a new roof, windows, insulation, solar panels and a high-e ciency heating and cooling system that dropped its monthly energy costs during the summer to $500 from $7,000-$10,000 before, Hauser said. It also created o ce space, renovated classrooms and created a commercial kitchen.

Building on those e orts, it recently purchased three parcels from the land bank across from the gym on Meldrum for about $12,600 from the Detroit Land Bank, Hauser said. It is working with Faber Design Co. in Detroit to de velop plans to construct and open within two years a $3 million building that will house its music, art and ro botics programs and science labs.

e new, 17,000-square-foot building will enable DBG to serve nearly double the number of stu

dents currently in the program, or about 400 each year, Hauser said.

DBG, which drew support from Madonna in 2015 while she was in town during a tour, is in talks with donors who are interested in helping fund the building, Hauser said.

“ e hope is won’t have to launch a formal campaign, but I don’t want to rule it out.”

DBG is operating on a budget of $3.4 million for scal 2022, with about $2 million in operating re serves that won’t be tapped for capi tal projects, Hauser said.

Regional expansion

DBG has also been talking with neighboring Romulus Community Schools, a district that’s seen years of academic and extracurricular de cline and student loss, about bring ing its programs there.

e move would mark its rst foray outside of Detroit.

DBG was making plans to launch the rst cohort of the Romulus pro gram by early December after the district’s board in mid-September approved a three-year contract with

the nonpro t and spending $500,000 to help stand up its operations in a space in Romulus High School.

Romulus Community Schools’ In terim Superintendent Donald Weatherstone, a member of the Michigan Unarmed Combat Com mission, which regulates profession al boxing and mixed martial arts, and some faculty members asked DBG to come into the district, Hauser said.

“ ey are working around the clock in Romulus to reinvigorate the district and provide the supports needed for the community,” Hauser said.

“ ey thought our program, be cause we are so individualized and have years of data to back up the model, would be a perfect puzzle piece for what they are trying to put together out there.”

Uncertainty around the move to Romulus arose last week, however, after the board voted to terminate Weatherspoon’s contract over nan cial concerns before naming Yolanda Bloodsaw, director of curriculum and instruction for the district, as in terim superintendent while the search for a permanent administra tor takes place.

e Romulus Community School District Board of Education could not be reached for comment Friday.

Sweeney said DBG is closely moni toring the developments in Romulus.

“We are committed to making ev ery attempt to provide support to children and families in the Romulus community who have expressed the need and desire for additional re sources. As always, no matter where we are, the best interests of the stu dents, families, and our team are our number one priority,” he said.

Beyond Michigan

DBG has been asked for years to either replicate its program in other place or license its model, Hauser said.

It’s in conversations with groups from another, undisclosed state in the region, and others in Africa and Spain, she said.

“We’ve spent the last year and half building out a licensing model, (and) we are close to rolling out.”

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

King B, 16, participates in a workout at Downtown Boxing Gym in Detroit last week.

| NIC ANTAYA/CRAIN’S DETROIT BUSINESS

Khali Sweeney, founder and CEO of Downtown Boxing Gym, and Jessica Hauser, executive director. | COURTESY OF ISAAC MINTZ

Emanuel S, 8, left, and Samyia H, 9, works on school work at Downtown Boxing Gym in Detroit on Sept. 29, 2022. NIC ANTAYA/CRAIN’S DETROIT BUSINESS

“THE WHOLE DREAM IS TO GO GLOBAL WITH THIS, TO HELP AS MANY KIDS AS POSSIBLE.”

—Khali Sweeney, Detroit Boxing Gym founder and CEO

Jim Bieri thrives where real estate meets legal practice

In his nearly 50 years in retail real estate brokerage, Jim Bieri, founder of the eponymous Detroit-based Stokas Bieri Real Estate rm, has seen the highs and lows of the industry. A graduate of Western Michigan University and the Detroit College of Law, Bieri maintains both real estate and legal practices, and represents landlords and retail tenants both large and small. He spoke with Crain's about the past, present and future of the industry.

 Brick-and-mortar retail took a beating in the early days of the pandemic. Has it rebounded at all or is there still a ways to go?

Retail is constantly evolving. Clearly internet and delivery became more prevalent during the pandemic for obvious reasons, because stores were closed. But basically internet retailing has passed catalog retailing from 30 years ago. The percentage is right around 15 percent, give or take. What makes retail work is that the customer provides the labor. Amazon is losing money hand-over- st under delivery service. There is no grocery store in America that can make money on delivery. Retail depends on the customer walking in and picking up the good and taking it home. And it’s pretty much back ... The volumes are about the same as they were before the pandemic. Tra c is down in certain areas. Sometimes they close malls. But open-air and streets, sales are back. Certainly places that are dependent on central business districts are still challenged because people aren’t back in their o ces, but in general, retail is doing just ne.

 How has leasing activity been?

There are a lot of companies going crazy. If there was one word for the

BY| KIRK PINHO

a new store; the rents won’t support new construction. So much of retail is recon guration of old spaces. We just lled a space at the old Kmart on Hall Road that was vacant for 40 years. That space is becoming gobbled up. The real growth in retail, you’ll see all this retail up on the street.



What’s the future of retail?

Look at Burlington, which is a company that’s on re. They used to be 100,000 square feet. Now they are down to 22,000 to 25,000. They are following the successful pattern of T.J. Maxx. They are providing value and a treasure hunt at the same time. Costco is o the charts. Walmart continues to knock ’em dead. Target has ups and downs, but their trajectory is very good. Amazon continues to roll along, but they have stopped 50 million square feet in warehousing in the last few months. I think retail needs to be omni-channel. They need to provide a lot more experience to their customer. Models like Bonobos and Warby Parker provide a really heavy online experience, combined with an in-store experience.

 What scares you most about the future of retail? What makes you most hopeful?

What scares me most is cost. Retail margins keep shrinking because the cost of labor, cost of goods keeps going up and rent percentages haven’t really come down to the point they need to.

to interact with each other. We have a half-dozen small companies we’ve worked with, like Rebel Nell that come up with an idea, do a pop-up store. Skinphorea is another one. Busted Bra is another one. These are all three small companies that have incubated in Detroit.

Skinphorea is going to Dallas, Rebel Nell is trying to do Atlanta and Chicago, Busted Bra is in Chicago. If you can create a formula that works, you can duplicate it, and that’s the most positive thing about retail.

 You founded the company nearly 50 years ago. Any sense on whether you’ll slow down and retire at any point soon?

I’m still enjoying myself. I nd myself in more of a mentor role now as you become the more senior person. It’s good that they have this experience because you see how deals are done in the past. Real estate is a business of relationships and I have fortunately many relationships I can call upon, when necessary, to help get things done.

big box stores, it’s lack of space.

Construction costs have gotten to the point where it’s very di cult to build

Also the lack of capital. What I do like is all the innovation and understanding that retail is very personal and people really do want

 What do you do to keep busy? We are fortunate to have a house on Lake Huron we like to go visit. I work out every day. I have been an active member of the Detroit Athletic Club for 40-some years, and my hobby is what I do for a living.

RUMBLINGS

Bill to protect Airbnb-style rentals approved by Senate panel

 A Michigan Senate panel on Wednesday advanced legislation that would prevent local governments from passing or enforcing ordinances that have the effect of prohibiting short-term rentals.

 The bill, which the House narrowly passed nearly a year ago, was sent to the Senate on a 6-3 vote after no debate in the Republican-led Senate Regulatory Reform Committee. The Senate was not expected to vote Wednesday, potentially the last day of voting until after the Nov. 8 election.

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CUSTOMER SERVICE

residential, not commercial, use of property that is not subject to special permits or procedures.

Local governments could limit the number of short-term rentals owned by the same person and cap the total number of shortterm rentals as a percentage of all residences.

Municipalities could continue to enforce certain ordinance provisions if they existed in July 2019.

The fight over short-term housing rentals has been waged in the Legislature for years.

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Editorial & Business O ces



The measure is supported by Airbnb, the Michigan Association of Realtors and the Rental Property Owners Association. Municipalities and the Michigan Restaurant & Lodging Association oppose it.

The legislation would say that renting a dwelling is a permitted

Local governments have been accused of trampling on property rights with overly restrictive and unfair rules. On the other side are lodging, tourism, and city and township officials who worry about the unrestrained growth of short-term vacation rentals through online platforms like Airbnb.

1155 Gratiot Ave., Detroit MI 48207-2732; (313) 446-6000

“THEY NEED TO PROVIDE A LOT MORE EXPERIENCE TO THEIR CUSTOMER. ”

Jim Bieri, founder, Stokas Bieri Real Estate

Jim Bieri is the founder of Stokas Bieri Real Estate

system

$82,199 in energy savings each year?

That can really heat things up.

The Westwood Heights school district in Flint was dealing with 60-year-old facilities. That meant older equipment — including their HVAC systems. Not only did that make school less comfortable, the equipment was also less efficient, which means valuable budget dollars were being lost in the ducts.

For help finding a way to reduce operational costs, they turned to the experts at Consumers Energy. Working together, they made a plan that included a cash rebate of over $197,000 through Consumers Energy’s business energy efficiency program. That rebate helped offset the cost of the school’s new energy efficient lighting and HVAC system, which improved the learning environment for students and staff — and saved over $82,000 in annual energy costs.

Is your business ready for some hot energy cost savings? Learn more at ConsumersEnergy.com/startsaving