CHAINSAWS AND HOPE: Prison-to-work program starts to show results. PAGE 3
THE CONVERSATION Mary Lynn Foster returned home to Michigan to lead the American Red Cross Michigan as regional CEO. PAGE 19
CRAINSDETROIT.COM I APRIL 13, 2020
COPING WITH COVID-19
CRISIS WIDENS CRACKS IN HEALTH CARE SYSTEM Anxiety still heavy as PPP enters 2nd full week
As coronavirus cases surge, hospitals are brought to the brink BY JAY GREENE
BY NICK MANES
By all accounts, the $350 billion Paycheck Protection Program has noble intentions: a lifeline to small businesses and their employees hit hard by the financial impact of COVID-19. But complaints abounded last week of banks having problems getting applications processes in place and functioning and dealing with more demand than they’ve ever seen. And professional service providers like lawyers and accountants are two weeks into the program and still lack clarity on basic definitions of who may or may not be eligible. The federal program, administered by the Small Business Administration, provides forgivable loans to businesses of under 500 employees that can be used on regular costs of doing business such as paying rent, mortgages and utilities, as long as those businesses keep their employees on the payroll for at least eight weeks. It doesn’t matter whether the business is open or not. But the scale of the problem — making up for the commerce halted to slow the disease’s spread — coupled with the similar scale of the solutions on offer has led to some horror stories. “I think the fact that this is spread out over so many banks, so many industries, and the fact that virtually everyone will be applying for (loans) that qualifies, you’re going to have some good, bad and ugly stories, and the challenge is, when you put things through this quickly, there are certain uncertainties,” said Tim Hilligoss, a shareholder in the Southfield-based small and middle-market accounting firm of Clayton and McKervey PC. See PPP on Page 16
Vineet Chopra, M.D., consults with Michael Mageli, R.N. (center), and Katherine Klug, R.N., at University Hospital in Ann Arbor Chopra expects the virus to reach peak impact on hospitals over the next two weeks. | MICHIGAN MEDICINE
As the COVID-19 pandemic moves into high gear in Michigan, thousands of frontline hospital workers are facing increasing stress, fatigue and frustration going into the second month of the public health crisis that is projected to kill more than 2,000 in the state over the next several weeks. Despite a growing number of recovered patients and those able to come off mechanical ventilators, many health care workers have taken to social media to express their anger at how government and the health care delivery system have proven insufficient to deal with the growing human catastrophe. The COVID-19 pandemic has exposed flaws and vulnerabilities in how government responds to pandemics and how hospitals staff, supply and deliver health care to populations they serve. And the results have been deadly. Systemic changes will be required to avoid a similar future catastrophe, experts tell Crain’s. See HOSPITALS on Page 17
FACING THE FLAWS OF THE UNEMPLOYMENT MAZE William Blunt
Katie Kelsey
Christina Otto
Jessica and Jon Robertson
Christopher Sanders
Jori Trelfa
Lauren Waters
Unprecedented surge in filings leads to flood of problems BY CHAD LIVENGOOD
They’ve called. They’ve logged in. They’ve even faxed. But they still can’t break through. Even as more than 800,000 Michigan workers have claimed unem-
VOL. 36, NO. 15 l COPYRIGHT 2020 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED
ployment benefits, there are an untold number of jobless workers who have not been able to file after four weeks of business shutdowns due to the coronavirus pandemic that has swept across the state. Their troubles are all the same: The state’s unemployment filing sys-
tem is down, the phone system puts them on hold for hours on end or hangs up. Several jobless workers report spending their days quarantined at home and redialing the Unemployment Insurance Agency’s hotline number all day long. “Calling and getting ahold of any-
one is absolutely next to impossible,” said Jessica Robertson, a wedding photographer from Northville whose line of work has been wiped out until September by a collapse of the in-person events business. See FLAWS on Page 16
FOCUS | WOMEN IN SKILLED TRADES
NEWSPAPER
ROOM TO IMPROVE From welders to carpenters to electricians, more women are joining the skilled trades, but their numbers are still low. PAGE 8
NEED TO KNOW
AL KALINE, 1934-2020
THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT ` STAY-AT-HOME ORDER EXTENDED TO APRIL 30 THE NEWS: Gov. Gretchen Whitmer on Thursday extended her stay-at-home order to combat spread of the coronavirus by more than two weeks to April 30, emphasizing that the threat of COVID-19 to public health has not subsided enough to resume normal activity. Whitmer's new order seeks to further clamp down on human contact that can spread the coronavirus. She imposed new restrictions on the number of customers allowed in stores. And the governor also imposed a new in-state travel restriction, prohibiting residents with second homes from traveling between the multiple homes after Friday. WHY IT MATTERS: Michigan’s numbers of cases and fatalities remain among the highest in the nation. “We are not out of the woods yet,” Whitmer said Friday.
` UNEMPLOYMENT FILINGS REACH NEW RECORD THE NEWS: Nearly 385,000 people in Michigan filed for unemployment benefits last week as the total layoffs and furloughs since March 14 quickly approach 1 million in the state in the wake of the deadly COVID-19 outbreak, according to state data. Nationally, 6.6 million Americans filed for unemployment last week, a slight drop from the 6.9 million a week prior.
Nearly 17 million Americans, or about 10 percent of the U.S. labor force, have filed for unemployment in the last three weeks. WHY IT MATTERS: Orders to stay at home to combat the spread of coronavirus have closed down a huge array of businesses, leaving many workers with no jobs. It is an open question how many of those jobs will come back when the orders lift.
` UNITED SHORE CEO PROMISES NO LAYOFFS
Images from a historic career ` Tom Donoghue, 72, worked as the Detroit Tigers team photographer from 1970 to 1974, capturing the most historic moments in the final leg of Al Kaline’s legendary career. Baseball was a simpler game back then, Donoghue recalled. Kaline’s humility despite his fame brought the game a deeper meaning than money and stardom. “My strongest memory was the camaraderie,” said Donoghue, who remembers striking a friendship early on with Kaline and the other players. “It was a game. Life was more important. They were just as concerned about you and your family.”
Kaline, a Hall of Famer and career Tiger, died Monday at age 85. “Mr. Tiger” was drafted out of high school and played more than 20 years for the Tigers, becoming one of the most celebrated players to don an old English “D.” His career included 18 All-Star appearances, 10 Gold Gloves and more than 3,000 hits — a milestone Donoghue captured. “It was just fun, just this great feeling that’s hard to explain. It was passion,” said Donoghue, a Dearborn native. To see more of Donoghue’s images, go to CrainsDetroit.com/Kaline.
THE NEWS: Mat Ishbia, president and CEO of Pontiac-based mortgage lender United Shore Financial Services LLC, on Thursday promised no job losses of any kind at his company of roughly 5,800 people. During a conference call with those employees Thursday, Ishbia acknowledged that the mortgage company is all but assured to enter a downturn as the COVID-19 pandemic has brought the U.S. economy to a halt and job losses have mounted to massive numbers in just a matter of weeks. WHY IT MATTERS: The fast-growing company has made taking a greater share of the highly fragmented wholesale mortgage market catering to independent mortgage brokers its watchword. Though mortgages are expected to slow in the coronavirus-fueled slowdown, the company could take more of the business that is available.
Al Kaline takes a cut against the Cleveland Indians in 1972. | TOM DONOGHUE
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M I
FINANCE
SPECIAL REPORT
Report: VC sector coming off ‘recordbreaking’ 2019 Too early to tell what virus will mean in 2020 BY NICK MANES
Chips fly as Ansley Harris cuts a limb in the climbing tree training area, where inmates train to become tree trimmers or linemen in MDOC’s Vocational Village program at the Parnall facility in Jackson. | DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS
LEARNING TO CLIMB
Chainsaws, convicts and hope: Inside Michigan’s prison-to-work pipeline BY JOHN BARNES | SPECIAL TO CRAIN’S DETROIT BUSINESS
Balancing in a tree perhaps 20 feet up, a utility worker belays to another branch. Nearby, a mason levels a concrete floor while a wouldbe big-rig driver shifts through the 18 gears on a semi-truck simulator. They all wear orange and blue uniforms — as in Michigan prison jumpsuits. The tree climber is doing time for armed robbery. The mason was busted with more than 200 marijuana plants. The semi-driver is a felon, too. The men are convicts, part of a Michigan Department of Corrections skilled trade program that officials say is showing early success in slowing the revolving door of repeat offenders. See TRAINING on Page 18
Robbie McCaskill works on coding his webpage in the “Last Mile” classroom sponsored by Google, as inmates train for skilled jobs in MDOC’s Vocational Village program at the Parnall facility in Jackson. | DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS
Even while looking into the economic abyss stemming from the COVID-19 pandemic, a new report shows a solid foundation going forward for Michigan’s venture capital community. The 2020 Michigan Venture Capital Association Research Report notes that the state’s entrepreneurial and investment communities are coming off a “record-breaking ” year that led to Topouzian 71 venture-backed startups and a total of $2 billion in new VC funding. Those numbers represent a 39 percent increase in the number of startups to receive funding over the last five years and a 913 percent increase in the amount of capital over that same time period, according to the MVCA report. The report notes that the sharp spike in funding stems, in part, from the $350 million investment last September into Plymouth electric vehicle company Rivian Automotive LLC. “This certainly represents last year’s efforts and it was a fantastic year last year,” said Ara Topouzian, executive director of the Novibased MVCA, of the findings in the new report. “I think we’re seeing more startups, more investment overall, but we see a need for more money into the ecosystem. We’re seeing a lot of out-of-state investment, which is good. So I think overall, this is a very promising report.” Like many others, Topouzian said it’s too early to tell what the spread of the virus could mean going forward, but said the numbers presented in the report “show the strength of the ecosystem.” Other industry insiders had a similar sentiment. See VC on Page 4
REAL ESTATE
Start of spring home-buying season shattered, but agents optimistic BY KIRK PINHO
The traditional start of the spring home-buying season received a shockwave worse and more unexpected than any in recent memory last month as single-family home sales plunged. The COVID-19 spread throughout Michigan and the subsequent shuttering of most of the state’s economy plunged home and condominium sales last month by 13.3 percent from March 2019 across the multiple listing service, according to Realcomp II
Ltd., based in Farmington Hills. Now what started last month as a somewhat mild concern among real estate agents a month ago has morphed into a serious — but most agree temporary — disruption in the housing market, experts said. “This was this is a once in a lifetime thing that happened to us,” said Jeanette Schneider, vice president of management services at Re/Max of Southeastern Michigan. “To some degree, I think we are looking at the spring buying season just being pushed back to very late spring this year.”
Sales have slid and people have pulled their homes off the market or declined to list them for now. In Wayne, Oakland, Macomb and Livingston counties, sales dropped 8.6 percent from 4,154 in March 2019 to 3,796 last month, according to data provided by Realcomp. But that’s 18.9 percent off March 2017’s 4,683 sales and 10.1 percent off March 2018’s 4,223. In the MLS as a whole, sales fell 13.3 percent year over year to 5,592 from 6,448 in March 2019.
The traditional start of the spring home-buying season received a shockwave when the coronavirus hit. | GETTY IMAGES/ ISTOCKPHOTO
See HOMES on Page 15 APRIL 13, 2020 | CRAIN’S DETROIT BUSINESS | 3
REAL ESTATE INSIDER
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Miami-based Out of the Box Ventures LLC purchased the 1.5 million-square-foot Lakeside Mall for $26.5 million in December. The company is reducing tenants’ monthly rent obligations in light of the coronavirus pandemic. | LAKESIDE MALL
Lakeside Mall tenants get a reprieve on rent for April and May
800.456.3824 fishbeck.com
Count Lakeside Mall owner Ophir Sternberg as another waiving rents for the mall’s tenants this month and next. With common area mainteKirk nance fees and PINHO property taxes remaining, his Miami-based company Out of the Box Ventures LLC, a subsidiary of Lionheart Capital LLC, anticipates that most tenants across his portfolio, including in the 1.5 million-squarefoot mall in Sterling Heights, will see a 60 percent to 70 percent reduction in their monthly obligation in April and May. “Some of the larger mall owners that own large very large portfolios were taking a pretty harsh stance, in my opinion, about the rent, saying that the full rent was expected on April 1, and we thought about situation a little bit differently,� Sternberg said last week in an interview. That’s a shot across the bow at Bloomfield Hills-based Taubman Centers Inc. (NYSE: TCO), which
VC
From Page 3
“Our entrepreneurs and investors have achieved much, but we must all consider what we as a community can do to continue promoting the strength, vibrancy, and progress of our state,� Michael Gross, MVCA board hair and managing director of Farmington Hillsbased VC firm Beringea LLC, said in a statement. “While Michigan’s economic development has indeed been remarkable, it is important to note that there is still work to be done if we wish to sustain our creation of jobs and generation of innovative ideas.� The MVCA report comes less than two weeks after a new report by Ann Arbor-based entrepreneurial research organization EntryPoint LLC — which also researched and developed the MVCA report — on the state of entrepreneurship in Detroit and the broader metropolitan region. The Detroit report offered a similar outlook as the broader statewide MVCA report: while a global pandemic offers nothing but uncertainty layered on top of more uncertainty, the startup 4 | CRAIN’S DETROIT BUSINESS | APRIL 13, 2020
sent a letter last month to tenants saying they expected April rent although the company also said in a statement later that it is being flexible with them. Sternberg joins Dan Gilbert’s Bedrock LLC (complete waiver in April, May and June) and the Ilitch family’s Olympia Development of Michigan (reduction in April, May and June) as local retail landlords publicly saying they are reducing or eliminating rent as coronavirus delivers continuing aftershocks to the commercial real estate industry, ranging from hotels to office space usage to construction. Notably, Royal Oak landlord Bill Harrison has said he is cutting his rents to downtown businesses in his three Washington Avenue buildings to $1, the Daily Tribune reported. Others may be doing similar measures but haven’t come forward publicly. Out of the Box Ventures paid $26.5 million for the mall along M-59 between Hayes and Schoenherr roads. It is about 75 percent occupied, he said, but has been shut down for a few weeks. Sternberg said less than half of the purchase price came from debt.
“We’ve got a very low leverage, so we felt like this is something we can do for our tenants, so we’re doing it,� Sternberg said. He also said he wasn’t sure specifically how much the loss of monthly rent from Lakeside tenants would cost him. I requested additional details on number and types of Lakeside tenants impacted as well as more specific information on how much the rent reduction would cost. “I mean it’s definitely painful. We’re taking a big loss by doing this. But I also know that the retailers and businesses are all suffering, so it’s essentially a way for all of us to share in the pain.� In addition to Lakeside, Out of the Box owns Battle Creek Plaza (84,300 square feet); a former Macy’s (102,100 square feet) and JCPenney (86,000 square feet) at Lakeview Square Mall in Battle Creek; a JCPenney (62,500 square feet) in Bay City; and a former JCPenney (62,600 square feet) at Midland Mall in Midland, according to the company’s website.
and investment economies in the region are on more solid footing than heading into past recessions. “Our members and I think investors in general are seasoned veterans that have been doing this for a very long time. This is certainly unprecedented times, but there have been other disasters that they’ve worked through in the past and come out OK,� Topouzian said.
the report notes, adding that those companies will likely need another $1.21 billion of additional funding over the next two years. While the numbers appear solid, some of the world’s premier venture capital funds are telling founders that it’s time to buckle up. In an early March letter to its portfolio companies, Silicon Valley VC firm Sequoia Capital — which has funded companies ranging from Apple to Google to DoorDash — called the coronavirus outbreak “the black swan of 2020,� and compared the likely financial impact to the 2008 collapse. Chris Rizik, the CEO and fund manager of Ann Arbor-based Renaissance Venture Capital, acknowledged some parts of VC had begun to get too hot and could suffer, but said that at a bedrock level, the industry remains intact. “A good startup here is still pretty attractively priced, and when it’s pretty attractively priced and it’s still useful, there’s going to be a good exit down the road,� Rizik said. “None of that changes with this.�
Investment on the rise All told, data presented in the MVCA report shows five years of substantial growth for the state’s venture capital industry. Since 2014 total capital under management has grown by $1 billion to $2.7 billion. The average fund size of the state’s VC firms has grown from $38 billion to $60 billion and total investment has more than doubled from $204 million to $514 million, the report said. During that five-year period, the number of VC firms operating in the state decreased from 26 to 20. Meanwhile, the number of venture-backed companies in Michigan has grown 12 percent since 2014 to 144,
Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB
Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes
EVERYDAY HEROES
Muslim community grocery delivery service gets food to homes #MichiganMuslims, started with a Facebook post, has 270 volunteers and a hotline BY ANNALISE FRANK
A local Muslim-led volunteer effort is filling a great need for groceries. The coronavirus pandemic is making it tough for people to get food from the store — especially the elderly, those with family in the hospital and those who are at a higher risk of infection and complications. #MichiganMuslims started with a Facebook post. In three weeks it has multiplied into a three-pronged, 2 7 0 -v o l u n t e e r operation with a hotline for those in need of grocery delivery. Its umbrella also houses meal doAhmed Sheikh nation for health care workers and mask-sewing efforts. While they credit the group of volunteers and more than a dozen partner organizations, the two who began organizing the Michigan Muslim community grocery delivery service are Sumaiya Ahmed Sheikh of West Bloomfield and Riyah Basha of Bloomfield Hills. Ahmed Sheikh, 28, a former executive director of the Michigan Muslim Community Council, posted on
Imran Vaid, a volunteer with the #MichiganMuslim community grocery service, poses during a delivery. | SAMREEN VAID
Facebook looking to see what community efforts were forming to help people as COVID-19 began to bombard Michigan. Basha replied, saying she’d like to help with groceries. Basha, 22, lived in Philadelphia, where she works for the district attorney’s office. But as the outbreak became a reality in the U.S., she ended up driving to metro Detroit where her family is based. Basha and Ahmed Sheikh empha-
size that the idea isn’t new — they have been following advice and examples from other communities and organizations, as piecemeal efforts form across the country to fill gaps in services during the coronavirus outbreak. A Canton Township mosque and nonprofit organization, Muslim Community of Western Suburbs, had started its own grocery service in response to COVID-19. They modeled
their effort off of that and others. Apps like Shipt and big box stores like Kroger have been overloaded in recent weeks, making it tough to get groceries in a timely fashion. “I truly believe when we all work together, we can really build a movement and reach out to many more people than one person could do alone,” Ahmed Sheikh said. #MichiganMuslims offers the grocery service to those of any faith background who may be elderly, at high risk for complications from COVID-19 or who can’t get their own groceries for myriad reasons. “The effort follows in the tradition of the Prophet Muhammad, peace and blessings be upon him, to honor the rights of neighbors, elders, and those in need,” the group’s website says. The areas the volunteers now cover are Macomb, Oakland and Wayne counties, Lansing and Flint. They’ve served 90 families groceries and delivered around 150 meals. The team has raised more than $6,000 that is being distributed for meals for health care workers on the front lines and limited financial aid assistance. The Amity Foundation in Dearborn and Dearborn Heights is managing the finances. As they look forward, they’re considering a curbside grocery pickup model with local grocers, Basha said,
and they’ve thought about making an app. The group’s 17 partner organizations include IIC Youth, Muslim American Society Detroit, Islamic Association of Greater Detroit, AlAjal Organization of Detroit, Muslim Center and others. They’ve also received support from U.S. representatives Rashida Tlaib and Brenda Lawrence. Then there’s the logistics behind it all. Those in need of groceries can call the hotline at (734) 210-0316.A volunteer assigned to their area logs their grocery list and shoots out a call to a group of volunteers on the WhatsApp messaging app. The volunteer then gets the groceries and delivers them, with no contact, while wearing a mask and gloves. Grocery clients can also fill out lists online. Basha called the need for food services “staggering.” She said she has spoken to callers who may not have eaten for days. “It’s as much a project about goodwill and service as it is about equity,” she said. “It’s about finding what the communities and neighborhoods and families that don’t have the same social net (need) ... and allocating those resources as such.” Contact: afrank@crain.com; (313) 446-0416; @annalise_frank
SPONSORED CONTENT
THOUGHT LEADER FORUM CYBERSECURITY
MICHIGAN BUSINESSES: INVEST IN CYBER WORKFORCE Cybersecurity is growing to be one of the key issues employers need to address to protect their business. However, a larger concern many employers are overlooking is the widening cybersecurity talent gap. The National Initiative for Cybersecurity Education, a workforce framework developed by the National Institute of Standards and Technology, identifies multiple categories of cybersecurity workers, each with specific job tasks, including: Lonnie Decker is Department Chair for the College of Technology for Davenport University.
Analyze – Threat Analysis Collect and Operate – Cyber Operations l Investigate – Digital Forensics l Operate and Maintain – Network Services l Oversee and Govern – Cybersecurity Management, Strategic Planning and Policy l Protect and Defend – Incident Response, Vulnerability Assessment and Management l Securely Provision – Software Development, Systems Development l l
Whether an individual likes problem-solving (software development), teamwork (cybersecurity management) or investigation (digital forensics, vulnerability assessment), there is a place for nearly everyone in the cybersecurity workforce. The number of people interested in these jobs, however, is at a deficit. According to Cyberseek.org, there are more than 504,000 job openings in cybersecurity in the United States. With 997,000 people employed in cybersecurity today, the workforce will need to increase by nearly 50% to meet the needs of today’s market demand. In the Detroit area alone, nearly 8,700 cybersecurity jobs are currently open.
Cybersecurity as a business priority isn’t going away anytime soon. According to a 2019 Accenture study, the United States saw an 11% increase in security breaches year over year. At the same time, the U.S. Securities and Exchange Commission reports the average cost of a cyber data breach rose from $4.9 million in 2017 to $7.5 million in 2018. Michigan businesses are at heightened risk of cyberattacks if they can’t find and keep good talent. Surprisingly, many businesses are overlooking a simple solution to this issue – investing in their own workforce. Whether it’s covering the cost of a professional development or certification program or funding some or all of the costs of an advanced degree, it’s up to each individual business to understand the needs of their employees and what they can each do to keep their good employees longer. Here are three steps Michigan businesses can take to address their talent gap: 1. Understand the current talents of your workforce and key opportunities to develop your staff. 2. Create opportunities for employees to enhance their skills by completing an advanced degree or certificate program. 3. Partner with a university like Davenport to enhance your benefits portfolio and advance the skills of your workforce.
You have a dream. Whether your dream is to finish what you started, earn a better salary or show your kids what a quality education can do, Davenport University can help you get there. davenport.edu/achieve
If you aren’t taking these steps to improve your talent pool, you are leaving yourself and your organization at risk.
APRIL 13, 2020 | CRAIN’S DETROIT BUSINESS | 5
COMMENTARY
ANALYSIS
Recovery depends on a lot, but economy isn’t broken The forecasts seem impossibly wretched. Economists at JPMorgan Chase project a 40 percent decline in gross domestic product in the second quarter. Trillions of dollars in economic activity abandoned in the Dustin wake of COVID-19. April’s WALSH unemployment rate is expected to hit 20 percent or more. That’s 25 million without work. More than 817,000 filed for unemployment in Michigan in the last three weeks — and more than that tried to. The numbers are all far, far worse than we saw in the Great Recession. But there is reason to think the bounceback might also dwarf the long, slow recovery from the 2008 crisis. While the greatest economic decline in recorded U.S. history is certainly depression inducing in a clinical sense, it’s still only a temporary economic recession — for now. The economy is largely shut down because, and this is an important distinction, political, business and health leaders forced it. This is intentional and not a fundamental crack in the global, national or local economies. Economic activity cratering is exactly what we want. We hit the pause button on purpose. That has ramifications, such as the aforementioned job losses and a near total loss of demand for everything but streaming services and groceries — U.S. consumer discretionary retail spending is down 80 percent to 90 percent right now, according to credit rating agency Fitch Ratings Inc. But jobs aren’t being wholly destroyed permanently. The U.S. and Michigan purged jobs during the Great Recession at a rate that looks almost laughable today. In January 2009, the highest weekly unemployment claims figure was 665,000 in the U.S. and 76,702 in Michigan. Last week, those figures were 6.6 million nationwide and 384,444 in Michigan. But because the economic fallout was, by comparison, a much more slow-rolling disaster, policy decisions were also delayed. The Great Recession was declared a recession in December 2007, yet the Emergency Economic Stabilization Act of 2008, later to become the Troubled Asset Relief Program, wasn’t signed until October 2008. This time, Congress earmarked $2.3 trillion in aid within weeks of the outbreak in the U.S.
The latest University of Michigan forecast calls for an unemployment rate of 24 percent in the second quarter this year, but a rebound over the summer because of the quick actions of the government. The U.S. Treasury Department confirmed Friday that it began processing economic stimulus checks — $1,200 maximum for individuals below a certain income, more for families with children. Some argue it’s not enough. The expansion in unemployment insurance also occurred rapidly and is including contractors and “gig” economy workers. The U.S. and Michigan is facing a two-faced devil, the virus and the economic fallout. They are interconnected and difficult to unravel separately. That battle, often drawn along political lines, is already raging over when the state’s economy needs to reopen or stay closed longer. The truth, of course, is both. The question of when and how the economy recovers hinges on the ability to control the virus and its health impact. But it’s also true that at some point business are going to have to reopen or we face an even deadlier version of the virus in tragic economic fallout. China has largely returned to work — its auto sector is running at least 90 percent pre-coronavirus capacity. Southfield-based Lear last week released its “playbook” on how it reopened plants in China and CEO Ray Scott and a host of other multinational CEOs are advising Gov. Gretchen Whitmer on how they were able to do that. But let’s not pretend it’s back to normal. The Chinese are likely not falling over themselves to pack movie theaters and hot pot restaurants. The same will likely occur in the U.S. The economic slog could carry on for some time — economic predictions range wildly, forecasting a full recovery as early next year or not until 2021. The shock could linger like the Great Recession, which saw unemployment stuck at 9.4 percent in 2010, recovering only to 8.2 percent in 2011. Unemployment didn’t fall below 5 percent until early 2016. But the economy did recover and experienced 10 years of economic growth, the longest in U.S. history,. Whether that happens again is largely up to the virus and health officials’ ability to contain or eradicate it. Nevertheless, the economy isn’t broken. And, for that, there’s reason to hope. Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh
GETTY IMAGES/ISTOCKPHOTO
Legislators could provide hospital oversight in crisis Michigan lawmakers, feeling sidelined during the coronavirus outbreak as Gov. Gretchen Whitmer manages the crisis, could play a key role in settling some health care industry turf battles that have surfaced during the deadly Chad LIVENGOOD pandemic. The state Department of Health and Human Services has been struggling for weeks to get a handle on available beds in all Michigan hospitals and acute care specialists to relieve overloaded hospitals in Macomb, Oakland and Wayne counties, which account for 80 percent of confirmed cases of COVID-19. This all revolves around daily reporting of the number of available beds in intensive care units, ventilators not in use and open beds in negative pressure isolation units. The problem is, not all hospitals are reporting or completing the state’s daily survey, making it difficult for hospitals at capacity to figure out where to send patients on an hour-by-hour basis. As of Thursday, there was an “89 percent response rate,” according a daily report that’s buried on the state’s COVID-19 website. The state’s data on COVID-19 has been limited to total confirmed cases, deaths, specimens tested and demographic data about the deceased and infected — age ranges, sex, race and ethnicity. But there’s still no data on the number of cases inside nursing homes or the backlog of people with coronavirus symptoms who are waiting up to a week to get test results. Late last week, the state started reporting total COVID-19 patients hospitalized (3,823 as of Thursday evening) the number of people on ventilators (1,394) and how many people have recovered from the virus and been discharged from hospitals (700). Most other states with high rates of coronavirus infections are making this data public for weeks, according to the COVID Tracking Project, a collaboration of the private sector and journalists. “We’ve been struggling to get complete compliance across the state,” Gov. Gretchen Whitmer acknowledged April 7. Some hospital systems, such as the University of Michigan’s hospitals, are publicly reporting daily number of patients with COVID-19, the number of patients discharged and even
Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood
The Senate and House approriations committees, shown here during a March 5, 2019, hearing on Gov. Gretchen Whitmer’s first budget, are among several legislative committees that could play a role in providing oversight of Michigan hospitals during the coronavirus outbreak. | MICHIGAN SENATE
Write us: Crain’s welcomes responses from readers. Letters should be as brief as possible and may be edited for length or clarity. Send letters to Crain’s Detroit Business, 1155 Gratiot Ave, Detroit, MI 48207, or email crainsdetroit@crain.com. Please include your complete name, city from which you are writing and a phone number for fact-checking purposes. 6 | CRAIN’S DETROIT BUSINESS | APRIL 13, 2020
how many have been sent home in the past 24 hours. But the reporting has not been uniform. The state’s inability to get a real-time picture of the crisis within Michigan’s 20,500 hospital beds triggered stinging criticism from the CEO of the state’s largest health system. “If somebody has to wait 12 hours in one of our ERs, but they can be seen within two hours, five miles away, I think we have a moral obligation to tell the patient,” Beaumont Health CEO John Fox told Bridge Magazine and the Detroit Free Press on April 5. Fox detailed how patients are sitting in their vehicles in the parking garages of some Beaumont hospitals, waiting to get into jam-packed emergency rooms. The Beaumont CEO didn’t name names, but the implication is that some of his competitors are sitting on open beds while the state struggles to figure out which hospitals have space. This is where the Legislature could step in and provide a much-needed oversight role in compelling better coordination of hospital resources across the state during this crisis. Senate Majority Leader Mike Shirkey has been leaning on journalists to demand more data from the Whitmer administration. We have been. It took a little bit of prodding, but the state finally resumed publishing total specimens tested on March 26, giving the public a picture of the percentage of negative tests. But we don’t have the Legislature’s subpoena power. And we don’t have the Legislature’s power of the purse. The Legislature has the stick and the carrots. The chairs of key House and Senate committees that appropriate money for hospitals could start demanding real-time data out of every hospital, every day. Lawmakers could exert some pressure now on hospital executives and their lobbyists to better coordinate resources, including accepting patients that have capacity to treat and even sharing staffing and protective equipment. This may include pressuring a hospital in Coldwater to accept patients from Oakland County hospitals overrun by the pandemic. This would require a lot of backbone on the part of term-limited legislators in an election year to stand up to one of the most powerful lobbies in Lansing. But it’s well within their purview to do so.
Sound off: Crain’s considers longer opinion pieces from guest writers on issues of interest to business readers. Email ideas to Managing Editor Michael Lee at malee@crain.com.
OTHER VOICES
Digital access: The new frontier in K–12 equity BY PAULA HERBART AND DOUG ROTHWELL
With the news that our state’s K–12 schools will no longer be face to face for the remainder of the academic year, Michigan educators are poised Paula Herbart is to begin a new way of delivering president of the quality learning Michigan opportunities to Education students. Association. This is important work as we protect families now, and as we build a more robust digital education infrastructure for the future. And it requires us to ensure each and Doug Rothwell every Michigan is president and CEO of Business student has access to 21st-cenLeaders for tury learning Michigan. tools. According to NCES, 39 percent of students across the U.S. lacked access to the internet in their homes in 2015, which puts them at a very real disadvantage in today’s world. The majority of these students — 26 percent — were living below the poverty line, while other factors, like race and geographic location, were also significant. Here in Michigan, the issue is pronounced. According to Business Leaders for Michigan, our state ranks in the bottom half of states (28th) when it comes to the percentage of households with quality internet service. And the Michigan Department of Education estimates that one out of every three students, a total of 500,000 students, do not have home internet access and/or an electronic learning device. These ratios are even more dire in communities that have high concentrations of poverty or are in rural isolation. This is the most significant learning equity and social justice issue for students in our time. In Michigan, we must aim to achieve a 1:1 electronic learning device ratio for each and every one of our students, coupled with broadband internet access for every home in our state’s 83 counties. Consider the consequences of our failure to act. Students typically lose 20 to 50 percent of their learning during a three-month summer vacation, according to NWEA. Now imagine that break extended by as much as double the time — this learning loss could be as much as a year, while their more affluent peers are still moving forward in their learning. We cannot afford to delay. Our Launch Michigan steering commit-
MORE ON WJR ` Listen to Crain’s Group Publisher Mary Kramer and Managing Editor Michael Lee talk about the week’s stories every Monday morning at 6:15 a.m. Mondays on WJR 760 AM’s Paul W. Smith Show.
tee members — and the tens of terms of protecting public health, thousands of educators, business but in challenging our K–12 educaleaders and philanthropists they tors to resolve this important digital represent — are all-in to provide divide and bring quality online the necessary support at a time THIS IS OUR STATE’S MOMENT TO BRING when all-handson-deck are ur- OUR BEST EFFORTS TO THE EDUCATIONAL gently needed. The governor CHALLENGE THAT NOW LIES BEFORE US, deserves credit SO WE CAN HAVE AN IMMEDIATE, for the smart and practical POSITIVE AND LONG-LASTING IMPACT. approach she is taking to this matter. We believe the learning programs to scale. governor’s order to close Michigan Moreover, we believe Michigan schools is an important step for- parents are ready for solutions that ward for all of us — not just in help bring teachers back into the
lives of their children. If the COVID-19 crisis has taught us anything, it is about the valuable role our state’s professional educators play in keeping our students learning and directed toward a brighter future. There is a reason why many of us don’t homeschool our youngsters and, in many cases, parents are newly rediscovering it. This pandemic should elevate for us all that we can no longer let the inequities in Michigan’s education system linger and persist. Having made the call for education equity — and now technological equity for all students — Launch Michigan will help lead the charge. Our K–12
education members will be designing programs and accommodating the needs of their students, no matter what ZIP code they live in and what they may be facing. Our business and philanthropic members will be working in local communities across Michigan, providing financial and practical support where they are able. These are unusual times. This is our state’s moment to bring our best efforts to the educational challenge that now lies before us, so we can have an immediate, positive and long-lasting impact on the educational opportunities available to all Michigan students.
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APRIL 13, 2020 | CRAIN’S DETROIT BUSINESS | 7
WOMEN IN SKILLED TRADES
ROOM FOR IMPROVEMENT
BY ALLISON TORRES BURTKA | SPECIAL TO CRAIN’S DETROIT BUSINESS
Although women make up nearly half of the U.S. workforce, they are significantly underrepresented in the skilled trades. Women are there, across a wide range of trades — from welders to carpenters to electricians — but their numbers are low. “There aren’t enough women in the industry, for sure,” said Deana Neely, CEO of Detroit Voltage and a former secretary of the Detroit chapter of the National Association of Black Women in Construction. “It’s not diverse enough. Oftentimes, I am the only woman in the room.” In the construction industry, women account for just over 10 percent of the workforce, according to 2019 Bureau of Labor Statistics data. That includes administrative and office jobs as well, so the number of skilled tradeswomen in construction is even lower. At the same time, the skilled trades are facing a labor shortage. “The baby boomers are aging out, and then there’s this huge gap,” Neely said. “So we’re rushing to try to fill it, to try to train people to take their places.” In Michigan, 47,000 openings in professional trades are expected every year through 2026, according to the state’s Going PRO in Michigan campaign. So why haven’t more women stepped forward to fill this gap? Several barriers may be to blame, including misperceptions about working in the skilled trades and the fact that many women simply don’t consider this career path as an option. “The expectation that the skilled trades somehow require a physical strength or a mechanical know-how that only men can have, or that only men are good at, is false — but still
8 | CRAIN’S DETROIT BUSINESS | APRIL 13, 2020
pretty pervasive,” said Jen McKernan, communications director of the Michigan Regional Council of Carpenters and Millwrights. But there are signs of growing interest among women. At the Michigan Regional Council of Carpenters and Millwrights, “we are seeing a huge increase in the number of women joining every year,” McKernan said. “Every single day, women are telling me, ‘I’m working with women on a job site. I’ve never worked with a woman before.’” And although the number of women in construction is low, it is the highest it has been in 20 years, a report from the Institute for Women’s Policy Research points out. And women’s job growth in the construction trades is far outpacing overall job growth: 17.6 percent for women versus 3.7 percent overall, from 2017 to 2018.
Several organizations and programs in Michigan aim to get more women involved. Women in Skilled Trades works to promote better lives for women through skilled trades. Women Who Weld trains women to enter the welding industry, where women make up only 4 percent of the workforce. And Focus: Hope has created several workforce development programs, including a Women in Manufacturing & Technology program that it started with General Motors. Going PRO in Michigan aims to elevate perceptions of professional trades — including health care and IT — and highlight the opportunities they offer. The campaign points out that the median income for these trades is $54,000, which is 45 percent higher than other occupations. See TRADES on Page 14
Women making strides in skilled trades, but there are more gains to be made. THIS PAGE Leading a construction firm with an equitable ethos. THIS PAGE
A trailblazer’s advice for sparking the next generation’s curiosity. PAGE 10 Building a more inclusive workplace culture . PAGE 10 The skilled artistry of painting. PAGE 11
An electrician strikes out on her own PAGE 11
“THE EXPECTATION THAT THE SKILLED TRADES SOMEHOW REQUIRE A PHYSICAL STRENGTH OR A MECHANICAL KNOWHOW THAT ONLY MEN CAN HAVE, OR THAT ONLY MEN ARE GOOD AT, IS FALSE — BUT STILL PRETTY PERVASIVE.” — Jen McKernan, communications director of the Michigan Regional Council of Carpenters and Millwrights
W sk m
Leading a construction firm with an equitable ethos Tanya Saldivar-Ali | Business Development Director, AGI Construction LLC BY ALLISON TORRES BURTKA | SPECIAL TO CRAIN’S DETROIT BUSINESS
Tanya Saldivar-Ali first got into the construction industry 16 years ago, when she and her husband, Luis Ali, an electrician, decided to try real estate investments. “We purchased our first property in Detroit, and I was basically seven months pregnant, on the floor laying tile,” Saldivar-Ali said. They sold the house through a land contract to a family that wouldn’t have been able to afford it otherwise, and they were hooked. They cofounded AGI Investments (later AGI Construction). But then the market crashed in 2009. As they recovered, they switched gears into property services, and then into residential and commercial construction. Luis is in the Air National Guard, and when he deploys annually, Tanya manages the business solely. Their first large project was renovat-
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Women making strides in skilled trades, but there are more gains to be made
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ing the 6,000-square-foot basement of Detroit Cristo Rey High School. “The kids now have an amazing lunchroom and media center that enhances their educational experience,” Saldivar-Ali said. Before that, they had been eating lunch in their gym. The project changed SaldivarAli’s perspective: “It was no longer about the big contract,” she said. “We now prioritize equitable projects that have long-term positive returns for Detroit neighborhoods.”
This brings together Saldivar-Ali’s passions for urban planning and community development. “It’s about inclusion in placemaking and activating spaces for people, versus just brick-and-mortar construction,” she said. AGI is launching its own development project, converting a historic home in Southwest Detroit into a coworking incubator space.
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See ETHOS on Page 14
APRIL 13, 2020 | CRAIN’S DETROIT BUSINESS | 9
FOCUS | WOMEN IN SKILLED TRADES
A trailblazer’s advice for sparking the next generation’s curiosity
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Adrienne Bennett | President and CEO, Benkari
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BY ALLISON TORRES BURTKA | SPECIAL TO CRAIN’S DETROIT BUSINESS
Adrienne Bennett has been in the plumbing industry for more than 40 years. At a get-out-the-vote rally for Jimmy Carter in 1976, a man who was recruiting for a plumbing apprenticeship walked up to her “and said I looked like a woman who could get something done,” she said. She was intrigued, so she started working as an apprentice plumber. In 1987, she became the first female master plumber in North America. At the time, she was an anomaly, and many of her colleagues let her know in no uncertain terms that they didn’t want her around. “I was told that verbally, physically, to my face on a daily basis for over 20 years,” she said. “At the time, there were no resources for me to go to, to complain. I was told that if I couldn’t handle it, to leave.” But the plumbing industry was not unique — Bennett learned from talking with other professional women, from attorneys to doctors, that “the prejudice was across the board when entering into a male-dominated field,” she said. She was the only woman on the
worksite at a time when many men believed a woman’s place was at home. Still, Bennett persisted. She started her own company, the plumbing contractor Benkari, with her sons, Ibn-Hashim Bakari and A.K. Bennett. Ford hired the company to help with its renovation of Michigan Central Station, including getting water out of the building and winterizing it. Little Caesars Arena is another of its projects. Bennett has noticed that more women have come into the skilled trades over the years, pointing to key roles in the construction industry that men have typically held — but that women have taken over in recent years. Getting more women into the skilled trades will require getting elementary school children engaged, she said. “Children are naturally curious, and if we pique that curiosity at an early enough age,” more children will be interested in building and making things, she said. She recalled an event with the National Association of Women in Construction, where they brought in a group of kids and gave each of them a packet containing a piece of cardboard, some Legos, string, foil and other materials, and asked them to build something.
BY A SPE BUS
Adrienne Bennett (center) with her team at Benkari. | BENKARI
One boy built a structure with a rock hanging from a string, and he explained that if he had a magnet, he would use it “to go over the Flint River and pull all the lead out of the water,” Bennett said. “This was during the Flint crisis. His mother was a nurse, and she was treating lead-poisoned children.” If a simple exercise can spark that
kind of ingenuity in a child, “can you imagine what we could be producing?” she said. “We as Americans should get back to building our own, educating and teaching how to survive and how to grow — how to build,” she said. “Everybody can’t be a lawyer, everybody can’t be a doctor — because somebody’s got to maintain that
hospital that the doctors are working in.” Many people are well-suited to skilled trades, but first, you have to get their attention, she said. “And then, once you get their attention, show them how they can use their hands. We built the pyramids, and the pyramids are still standing thousands of years later,” she said.
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Building a more inclusive workplace culture
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Building Cooperatively | Gabrielle Knox, Alex Moore, Chloe Songalewski
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BY ALLISON TORRES BURTKA | SPECIAL TO CRAIN’S DETROIT BUSINESS
BY A SPE BUS
Building Cooperatively is a coop in Detroit that focuses on historic restoration and investing in the community. It includes seven co-owners — among them Gabrielle Knox, Alex Moore and Chloe Songalewski — and other members. The co-op grew out of several neighbors working on their houses. They attended a training program together, the Living Trades Academy, through the Michigan Historic Preservation Network. They built their skills, learned more about restoring old houses, loved it and decided to continue working together. “I like working with my hands, and I like being busy,” Songalewski said. “I also love architecture and the beauty in 19th century houses — the craftsmanship and what they did back then is just so beautiful.” She added that even the plastering “is like a sculpture in itself.” The group built trust in each other while spending 40 hours per week in class together, Knox said, and “there was already a lot of respect and relationship built based on being neighbors. So it was pretty easy to transfer that into a business.” 10 | CRAIN’S DETROIT BUSINESS | APRIL 13, 2020
In the co-op they built, they share the work and support each other, both as workers and as people. The co-op has included a mix of gender identities, racial backgrounds, people who speak English as a second language and people who are LGBTQ — so it broadly includes people who are underrepresented in the larger world of the skilled trades. “When we were developing what we wanted this to look like, we put into our bylaws the idea of holding that space for black and brown people, for the LGBTQ community, which a lot of us — including myself — represent, as well as Detroiters who are residents,” Knox said. “As a company, we have done a really good job at operating in a way where there’s equal pay, and where there’s equal work.” Songalewski sees this kind of group as one way to change perceptions of who belongs in the industry. She said that sometimes male subcontractors ignore her and talk to her male counterparts instead. “They don’t really take me seriously because, for one, I am female. Two, I’m queer. Also, I’m like five feet. I look like I am an 18-yearold, but I’m actually 30,” she said. When that happens, Knox said, team members advocate for each other — which might mean that if someone goes to a man with a
Gabrielle Knox (left), Chloe Songalewski and Alex Moore of Building Cooperatively | BUILDING COOPERATIVELY
question that should be directed to one of the women, he will point out, “Well, actually, this person is the site manager here.” It also might mean a conversation about “how we see masculinity being toxic in this particular way,” for example, Knox said. Perceptions that women don’t belong in this kind of work are part of what prompted Moore to get into it. Perceptions like “‘You’re a girl, you
can’t carry heavy things,’ that I had subtly sprinkled throughout my entire lifetime, added up to me wanting to learn how to do everything,” she said. “I’ve always really enjoyed learning how to do the things that I use in my life,” Moore said. “If I have to always have a roof over my head to be safe, I want to learn how to put a roof over my head.”
Moore pointed out that attitudes about women in the skilled trades are “an entire cultural thing — not just the way the trades are set up,” she said. “Our work spaces are going to reflect our culture, because humans who were raised in this culture create them.” And Building Cooperatively’s work spaces reflect the culture that the group has built.
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The skilled artistry of painting Rose Mazzola | Owner, Rose Town Painting BY ALLISON TORRES BURTKA | SPECIAL TO CRAIN’S DETROIT BUSINESS
Rose Mazzola is from Detroit but moved to Florida in 2006. She moved back last year and started her own painting company, Rose Town Painting. “I’m an artist and a musician, naturally,” she said. “I’ve always thought of painting as an art. And it is an art — you create your own style of brushing and the way that you move. And I just like making things look better.” In Florida, Mazzola worked a mix of different construction jobs, including roofing, carpentry and painting, for about 10 years. She always liked painting but didn’t really know how to paint like an expert until her then-boyfriend, who had his own painting company, taught her. “He was down on his knees, and he was running baseboard over carpet with no tape, no drop cloth — nothing — and I was just like, ‘How are you doing that?’” she recalled. “His bristles went underneath the carpet but didn’t get any paint on the carpet,” and then she watched him cutting in the baseboard to the wall. He showed her once and handed her the brush. See PAINTING on Page 14
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An electrician strikes out on her own
SPIROS ASSIMACOPOULOS PRESIDENT & CEO MICHIGAN BREAD EMBA, CLASS OF 2018
Deana Neely | CEO, Detroit Voltage BY ALLISON TORRES BURTKA | SPECIAL TO CRAIN’S DETROIT BUSINESS
Deana Neely is CEO of Detroit Voltage. Her path to becoming an electrical contractor began when she was 18 and working for the Detroit Buildings, Safety Engineering and Environmental Department and met her husband, a licensed electrical contractor, there. “We fell in love quickly, we had two babies, and before I knew it, I could no longer afford to work, because I was spending so much for child care.” So she became a stay-at-home mom and helped her husband grow his business, in part through the relationships she had built with contractors while working for the city. Several years later, she started to notice all the new construction that was going up around her, and she decided she wanted a piece of it — she wanted to start her own business. “So I studied, I tested, I became a licensed contractor and started the company,” she said. The future looked bright. “And then three months later, my husband left me,” Neely said. She didn’t know what to do. “I have this new business, these babies, and I haven’t worked in just about a decade,” she remembered. But she found a great team of electricians and started operating in 2018. “I just went out there and started network-
Deana Neely, CEO of Detroit Voltage | DETROIT VOLTAGE
ing, and my phone started finally ringing. And within six months, our revenue was somewhere over six figures. We’ve just kind of been growing ever since then.” Neely likes being able to help people through her trade. “I have people calling me all the time in emergency situations and they’re afraid, especially when it comes to electricity,” she said. She likes “just being able to put a smile on people’s faces.” But she has heard her share of negative perceptions of the industry. “People in construction get frowned
upon for some reason,” she said. Last year, her 14-year-old daughter came home from school after taking a career placement test. “She came home and said, ‘I feel so bad for my classmate. They said that he was going to be a plumber.’ And I’m like, ‘A plumber — that’s a wonderful career choice,’” she said. She explained to her daughter the necessity of plumbers and other skilled trades — including her own. “And I could see it clicking for her.” See ELECTRIC on Page 14 APRIL 13, 2020 | CRAIN’S DETROIT BUSINESS | 11
FOCUS | WOMEN IN LEADERSHIP
The unexpected rewards of a real estate career
Susan Harvey, a criminal justice major with plans to enter law, has 37 years in the business BY RACHELLE DAMICO | SPECIAL TO CRAIN’S DETROIT BUSINESS
Susan Harvey never expected to get into the real estate business. She had studied criminal justice at Michigan State University and eventually planned to become a lawyer. But in the meantime, she needed a job. She got one at a multifamily housing company in East Lansing, working in property management. She liked it so much she’s been in the real estate business ever since. “What started as just a job to make some money while I was figuring out what else I was going to do with my life turned into a career that I really enjoyed,” Harvey said. Today, Harvey has 37 years of experience in real estate and has spent 24 years at Ashley Capital. Ashley Capital has approximately 25 million square feet in its portfolio throughout the eastern half of the United States. The New-York based firm specializes in the redevelopment of large manufacturing facilities and new construction of distribution facilities. It is a large holder of industrial properties in Michigan. Harvey works in the Canton Township office among about 30 other employees. She is responsible for all aspects of the Detroit operation including property management, leasing, land acquisitions and development. Under her leadership, Ashley Capital has a number of notable developments in its portfolio, including the purchase of Hazel Park Raceway in 2018. Ashley Capital constructed two buildings on the site totaling 1.2 million square feet. Between the two buildings, the tenants include companies such as Amazon and LG Electronics. A third building totaling approximately 900,000 square feet is under way and was scheduled to be delivered at the end of 2020. Last year, the firm made Crain’s list of top industrial leases in southeast Michigan 17 times. The firm held the number two spot for a 6-year deal with Penske Logistics, a wholly owned subsidiary of Penske Truck Leasing Co. Penske is leasing 590,141 square feet at Ashley Capital’s Livonia Distribution Center. “One of the most fulfilling parts of my job is taking buildings that were sitting idle and being part of a team that transforms them into successful projects that increase the tax base in a community,” Harvey said. “Companies that lease space from us ultimately employ sometimes hundreds of people.” ` What drew you to real estate? When I took my first real estate job, it was certainly not a deliberate intent to get into real estate. I was 23, getting married and just needed a job. My first job was in multifamily real estate. It was a low income housing company. I ended up really enjoying it because of the constant problem-solving nature of the job. I found that I was able to improve the lives of the people that lived in the apartments that we rented out by cracking down really hard on activities that made it an inhospitable place for families. As somebody who wanted to go into criminal justice, constitutional law or civil rights, I’ve always had an inclination toward social service type work. To my 12 | CRAIN’S DETROIT BUSINESS | APRIL 13, 2020
The Harvey File Education: Bachelor of arts in criminal justice, Michigan State University. Juris doctor, Wayne State University Law School.
“THE ONLY THING I’LL KNOW FOR SURE FROM DAY TO DAY IS THAT SOMETHING I DIDN’T EXPECT TO BE WORKING ON WILL COME UP.” —Susan Harvey, senior vice president, Ashley Capital
Career ladder: Harvey began her real estate career in 1983, performing property management responsibilities for Lockwood Management, a former multi-family housing company based in East Lansing. She left Lockwood a few years later to join property management company Johnstown Properties in Southfield, where she performed property management responsibilities until 1987. That same year, she moved to Atlanta to work for Cushman & Wakefield, a global commercial real estate firm headquartered in Chicago. In her role, Harvey managed a large downtown office building for the real estate firm. Harvey returned to Detroit in 1989 to join Houston, Texas-based PM Realty Group, where she served as vice president in the Southfield office until 1996. For a brief period in 1993-1994, Harvey moved to Melbourne, Australia, to work for Toronto-Canada based Colliers, a global commercial real estate organization. There, Harvey was tasked with addressing the needs and concerns of companies that worked at the World Trade Center Melbourne during construction of one of Australia’s first casinos. Afterwards, she returned to her VP position at PM Realty Group, where she worked from 1994-1996. Harvey joined Ashley Capital in 1996, where she has remained ever since. Current role: Senior vice president, Ashley Capital Fun fact: Harvey worked as a store detective in college. “I arrested shoplifters at bookstores in the Lansing area,” Harvey said. “People would steal right in front of me because I was just this small, red-headed, freckled-faced girl that certainly didn’t look like a store detective.”
surprise, those instincts could be satisfied in the environment of multifamily work. ` Were there any early challenges you had to overcome in your career? Almost always in my career I’ve been the only woman in the room. Industrial real estate is overwhelmingly dominated by men. The younger you are, the more there’s a presumption that you’re not a person of authority in a situation. It’s very common for the other men on the other side of the negotiation to look to my colleagues who are men for the answer or for the approval. They presume I’m there for some other purpose, like note-taking. My theory has always been not to worry about it. The last thing I’m going to do is go into a meeting with some sort of a chip on my shoulder like I have something to prove. Now, society’s certainly changing since I graduated from college. I think those presumptions are starting to finally fade. `What’s your average day-to-day like? The only thing I’ll know for sure from day to day is that something I didn’t expect to be working on will come up. Maybe somebody calls me and says, “I have this great building I want you to look at” and before you know it I’m driving out to who knows where to look at a building. Honestly, just an incredible range of things. It’s all about problem solving. Then
there’s all the challenges that go with maintaining the physical structure of a property: keeping them in good shape, getting tenants, maintaining really good relationships with tenants. Then there’s the legal work involved with leasing and doing the purchase and sale agreements. It really comes down to the fact that there’s no monotony. No two days are the same. ` How do you make decisions regarding what real estate properties to pick? Location is always important. We always want to get properties that are reasonably close to major expressways and interstates. You want the building to be able to be renovated and useful. What that means is in the distribution building business, you want to be able to put a lot of dock doors on a building. You want to have good clear height on a building. You want to be able to divide it up in ways that distribution tenants can use, which are usually nice rectangles. (Ashley Capital) also has to buy it at the right cost so that once you put millions and millions of dollars into the renovation, you can rent it out for a rental rate that’s competitive in that market. ` Have you ever made any mistakes when it comes to investing in a property? We’ve made the mistake of building a
building too far from the expressway and it took forever to lease. Separately, when the economy was down, we should have only built one building and leased it up, but we went ahead and built two and sat on vacancy for a few years. That was pretty painful. The construction guys in my group are constantly improving on the details, from the fire suppression systems to how we design buildings. If you were to look back at all the buildings throughout the years, they could tell you how every single building was better than the last one. A lot of the learning comes from mistakes. Our successes and failures. ` What’s a project you’re particularly proud of? In 2007, we bought four and a half million square feet from Steelcase Inc. (a furniture designer and manufacturer) in Grand Rapids. It was an 18-building acquisition over 200 acres. The renovation and the rehabilitation of that campus was a ton of fun and a lot of hard work. The property was (powered) by a central coal-fired plant. That had to be dismantled and every building in the campus had to be fed with utilities. Every building was different, and we had to evaluate how to renovate each one to make it useful and marketable. It was a completely vacant complex and now there’s a couple thousand
jobs there. (The complex now includes industrial and office tenants and is still the headquarters for Steelcase on a site adjacent to Ashley Capital’s property.) ` How is the company adapting to the coronavirus crisis? How will you handle rent payments if your tenants are unable to pay? We’re trying to be responsive to tenants whose businesses are being greatly impacted by this and who may need rent relief. To get rent relief, we have to work things out with the lender because we have a mortgage to pay. We have loan covenants and lending restrictions that vary from property to property. We don’t have a one-size-fits-all approach. Regardless, I think we’re adapting really well. We’re on lockdown, but I’m still working as many hours and as hard as I ever have. I’m trying to keep as many deals moving forward as we can. There’s still plenty to be done. ` What advice do you have for women who are considering real estate development as a career option? If you have the basic skills, temperament and personality you should definitely give it a try. There’s a lot of opportunity to have a really interesting career. There’s no boredom in it. The financial rewards are good enough that you should definitely consider it.
r a ti e w ar ce a he the Eli d’s t ma gene grants a l servic years utiv e pa atic br need to ing that h E. M Offi She tient in Troy , ate boar proving ca alth c is doesn’t w e m e tim ag wit ical en u of st ogram 300 lo last fe k e. ness execabilitationprogram.ow is the fo y, he es th as trau ’s diseas s the im in 2017 r im pr wor a mix s. Yo d . 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Afte tration fr ce te for-profi ra tes gl qual cultu co ra an is ou of a fee19 port aspect ted he cal si cont based omes, . ing to mic and le living min a fin in N in ar ic cies ys on tc egood care o work mat ssen st at OCH siness ad ed into aster’s Valu on ou efficien care pa urage th d st heal Elia t job e are ntal, econ lion peop you to in bu she mov ed her m after was W t base and co , health n’t enco id. “All “ n ee en a il 12 , gr m e rn s el w lly tly 3m se nm cure or’s de in 2008 She ea sure istorica is does iassen sa mod shor “We four n. ent age nviro cing the 3 sin.” e to u Ward Detweiler chel and “H sis. Th e,” El at.” and paym pitaliz - ba er Colle ganizatioin 2013 r hav ba lum fa time n th ba if Bak e or Baker e new d hos rven full neve vice , just vo from , but Anya Eliasseissues at Lakes and at th five es ay on th s reduce isis inte sed oys role ce from man at ea com ing aw began evice re th oors it ha empl of cr d incr ov k our d you Javier Evelynin the G finan outd show ar. , now is m ce wor en said mber an d to ny g an u ly n e n ye r pa de Si av liass the n housi sailo a month rlier this roncom ssen d 15, E . le avid you h The e. vi ea Elia ,” stab in 20 reduce rved 21, so an s Now levision s of en e 33 an t s, rt tim iler is al e th ided ople se aff of es ke g g Te pa ov tion en n n La ci he ar blic ca al st of pe s, pr 30 Detw “Great it Pu raise aw issues fa basin,” ilin tion oyment financi ro n et o of s l a D ti s, sa Lake host ed on ltura ng to empl aging injec orki and cu e Great the lake ng this ch Man d laun e are w nds.” munity omic g in th aroun e enjoyi Deo “W c on in d send Com l liv wis an l, ec r from (auenta people on, in d other an hou like tota kla e m Oa w s p r e n CFO, te mostmillio grew u nting an unde hat feel of escape twork really, akbeers)anarattr In w e ibu “I m Health Ne causty”e jema y not samAnya Eliassen said. hing, hu we live. ind in the sort or e but bl r tivi-in ct CFthOs, e ot fis te rea tern s, n ck ac at to ate wit ew wes ing, tiful pl in a du hich is inhg t skil . ls. ohermbes orth e Ross n ce associ , cash ilk. ty N . l usit one w of vi au be uni c os al e s, n m mm de be th .” es Co ersicin from ca achi n in e In the nd consid everited funds troit, I wildern g cities degree BA from higan in pist ei ion med O ak ofesOakla Alerj bi to n lim ic e , ic to n prot 32 mill e As wCF ics ho m nt ma der, younages ai vice e for the pristin in most lerg his M ity of M els. ar r de e car ng onom got t u Eliasse wan e ou Foun Evelyn is inal — the mof roughlychildren,ivate l you ge t an ec , then Univers inte A got good ls to provid Network, Wesouto to,l yo rceus ess, inte n r go e Po he’s illn venta Health the the ing 2005 case the life millio hrine. Pr tions avie n in stance He ross me r-chang havepleyo wituhha 6 ctio and ity in iness at the G on and teran of stor. from eve inep od reac rding t if an litie injes and sub and to vers fish 000 peo us ve r ep rs ve ud ni 27, bu B . e, n a se abi cl U co ves of pe fo lif dist of vi ser t l ge s ss, ise gel in more tha uallyha His icans, in makers lactic 2016, ac t that hool is an ad ry smar rry Cro lopmenta ds.” annrje can agenncy a ae an lped ra eve Sc inp hy e d l/d e d er tim co le ofi lic pai tua . ve Te A al pre app lec .H ng pub se d , he Am ds of th of anap 07 an nonpr r, ion ile alth Net2012 ard is a e,” said and lo inTech company s, bille orders the 30 10 fareg ob s ,a n 20 dis ’s y han aims He an’ m ar c. So le use el ee ity e vnityApp “W sens mun in Sp r to the Techst ry of Michig ed itsmu in th nce cl betw ealth In privat e life-sa e budget nd m chCom stor As one andanneual se mon it ve H ent Oakla ra un pro- the idlion etro com artup co rly inve an advi mil th dic perc by Fair data on hile, th pply. Th s a insu 9ro lth plans, laa $31 aid inMe i- , And st ea 2013 and at D “Ward’ rogant, ill 377 is tient hea y manageson ed st d ch d an m ds, is g te e fun ar an rose research analyzes s. Meanw short su declared ar . rl ting in July Tro th al fun W rs was ot and by din genera und work in m st en to ller of cos it all with mothe tting ento He’s n and loc op of state iOSm,of Cross rrent ro he met s. gents m oved ing to s and ce clai ine is in ion fir day. gra ed to contro site mix gory g pr a th vice gra ss ith. e’s ve ct n at apal ser from Dru promoted 2014. She balanc ile working and ce loc its cu ss said ere bo rtner w higan pro cethade rs colle insura epinephr inistr rsists to founding 300 H and few n vi yea Mic or y ch e. w ro re alth dm l th p, od pa ar C last whi He rect O, in July two children wh l.” mo ca . Fothe) n, heal edicine Drug A and it pe lem by startu they rson to eniaa ciate di CF on ople ing s.m-You U.Ser s to operate of tim ee (ov ys em re ng io ob e rais rce rce is pe ng busipa d m st d, 18 at sou co sou pr re co he pe th g, you Th so p g g an ay 20 Sy hoo w d is in . r to din s to ac ue and as in nt a lot ble , he alttuh ca inistr star our M Food marto school. lve th in 2016 in fund slim n a mento an Association dmfun “I’ve spe lly ive an iler wasn’t Health to ing reea pegood20val hin A of bee ca . at wit ag ho t ori has a e U.S. tage in t to so get ts er e o 00 hig es rd to ativ a p car 20 direct uc “Histlike a lo ry coop sis etw ies box Inc. elyn isendo ou ssen als or 50,0 h the Mic leadershi ry Fo prod being cre k outside theEv 6, .DThH earlyfor dl e of rna a sh elyn set Alerje than $6 that carr with an ba l l ve ed toinpay ives throug s, a statewide -201 e. nesElia thin e ired rents, eas,ervice Ev based plish evicmesidanddiinte tiona ough the s execut have to -relat volum methods” 2013 at the cas, idr-s Officer mor ne case se, pa th fee-fo ’s ad went thr funding itlitation sin mere just ca s, pa tor is surer. ised ing ser From ationsoutco alth e an mpany lic develop ls, hou ator gram. She of Rehabi rd’s trea Detro has ra smartpho tor. The so . raisn. , hospitais alsaid 12 he on Elia genovgotaod oper to-injec moe co ynpub is the boa to sse said m that.” development pro ing the providers ive of in which ng on a to-injec to 911 encoura nycosts,trying lea el bas g ke enders g away fro sh thamong 3 and now te for improv The e au ed trat tage ki vin mpa union y in 201 lpin misHmo d, is ato puder 22g, Ev inis oca uee au alerts ion, if th gency. ks co val dem adv he adm at in wor rs ac 20 aca n an re rozat illio dev e org caTo s. er elopin ral B zation ity l tem. h— been ThThe ephr give form “We ngani n by m es in healt gu animinor ket. She has mental health sys ds of thousands epin will send r care in an em tyle in d a labe undi to engaged. $3 agenci izatio e oth e- All inauer org g he es s. vicDes ed-f lic style as cialers and necand ser hundre n lth mervid seme th ntaliohea n’t makin d at app, s or ot the case lpful lif book an allergen us of the state’s pub tem supports nagement m pro ber of reim en ses for ’s h. mill ctingcoto se s, s. We are boar me he c sole foc es, her ma ombur $2 alshaaIt is imthat t to acon nialmance lengt spou ed from ovide e recipe specifi olumbu “This sys contra h number se servic tractin scribes r with the rg w ill mem ’s lives. enfor tin W per pr af in oducbased ov C to es in a device ; react, r fo lity t work wit acting people lity of tho every yea d. “I grampr Dus tal will yn is le rem en-s e user at the ratoes, qua Valuethe qua the M inch don’t jus and pro ,” she sai of people . lerg ospi r Evel onacout app th ce com es on es. Bank. — We are imp d the clinical d. r-services and res 6 ve built reaction yn said er dollars health systs. sai -fo ser ed nci rv pay bile as an al ill alert llergists ren’s H of its pa su par fee she ary a it ce bas cie s, tax car se ea ess el ha doe erstan ntal to en e pays on e s a g off w andt effipend Detesroand d outagency el prot to und car .V., m bents profitin al. A e Child percent left th rscos e ha e it,” Ev e want e sur such r that public me into the hands lev goo the tan lth N on n at re rythe de por hea de age not wh e ent m eo e an us is ne lly, id W In unistorica get us in an encour ect” of fo“H g her lth care make sur Myl e incu n som , then scan e need ationw than 40 n they half wer First (does) not Greene ctive. have to u at doesn’t matic asp started her career 9. After earnin want to he d. “All hea N “Th r whe device Th proa troit’s is. 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40 40 UNDER
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SEPTEMBER 2 - 8, 2019 | crainsd
Motawi Tileworks molds its future
etroit.com
With brea ano big
40 40 UNDER
Since 1991, Crain’s Detroit Business has gathered 40 of the community’s overachievers for a special salute. Past winners have started (and sold) companies, precociously climbed executive ranks and made a lasting difference in their communities. Honorees will be featured in a special section on Sept. 7* and honored at the 20s and 40s Celebration in November. *REMINDER: Candidates must be 39 years old or younger on September 7, 2020 to qualify
John Haji, 32
Founder, The
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Gentleman’s
Box
Roslyn Ka
CEO, Détroit ng a s orDET tieROIthat they box that mon is th CRAIN’S got from our “I was the guy th,”FORsaid LEWKOW the founder box JACOBpan of subscriptio ITS BYcom oslyn Karamo y The Gentlem PORTRA n ko an’s Box. The Gentlem who dressed for ing fashion an’s Box cate sce roughly 40,0 rs to a com munity orga munity of 00 men who nizin the job I wante fashion acc receive lifes essories on Her compan tyle and d eith y, terly basis. er a monthly brand — a Each box is or quarrecognizabl rather than the topped off copy of GQ tote bags and with the late Magazine. T-shirts al st The Gentlem But at its core job I had. I dre an’s Box gen , it exis million in erates clos local brands ssed revenue ann e to $3.5 and des ign ually, said earned his bution that in a shirt and bachelor’s a brick and degree in exe Haji, who tie from Grand m “There’s not rcise science Valley State hing supe University. become an there are coll when other guy He planned exercise phy ectives all ov to s siologist, he didn’t take said. “I just any busines said, and thin k that s or would wear the marketing clas After graduati me doing it.” ses. ng, Haj i worked as director of Prior to laun the the Imports ching her polos.” Center at The assistant Collection, Seattle nati overseeing Suburban ve worked six dealers as a during that and Singapo hips. It was time that a re. Since then female frie about her , in differen nd told him Birchbox sub t spa ces around scription. The women’s bea G.R. N’Namd uty box got monthly i Gallery and the wheels turning. Corktown, in Haji’s hea eve ntu d ally year, Haji settlin “I thought manent flag is excited that there nee ship loca about how tion in like that for ded to be som Woodward PHOTOGRAPHS BY JACOB LEWKOW FOR CRAIN’S the next five men ething Avenue, nex years will unf week and didn , like me, who worked t d Madewell. old. He’s 70 hours a ’t have time Pages 8-29 also co-f said. to get to the “Every year ounded store,” he the city has a REAL ESTATE trade asso Focusing The bee the brand has ciation and Gen bee tlem n diff has created an’s Box on a no-brainer erent, e has been diff an annual fashion was for Haji. eren t,” Kar conference amoko “I was the guy true nature for subof this city who dressed scription box rather than and a tr for the job I uncertain all the job I had compawan of ted this is.” ,” he says. “I nies. shirt and tie Through app dressed in when other By Kirk Pinho lications, DIT a ers wou guys would And when I’d “More con signers and kpinho@crain.com “There’s a dearth of N ld ask me to this wear polos. year or the Summit walk into sulting brands on a Place Mall lift up my pan that kind of space,” the and outreac cousaid deapropLuke quarter ld see lers ny partnered ty primed fort legs erty that’s just been torn down, my Bonner, that and h is what’s If anything, 2019 so far has been a space in Southeast my cow it’s good to see crazy socks.” so they majorhip CEO with Pure Mic of orkAnn on deck. The Now thateconomic these properties turned over.” tion industry is to launch the higa big year for big sites. Michigan. It’s difficult milestones for large, and in some cases incentive, realArbor-based subscripThe Gentlem a bubble that bran estate and d accelerator economic I’m really look an’s has not bur Details previously troubled, properties have Boxofisthe The most recent example: A devel- to find 20 acres, The compan Silverdome in planned st yet, so ing forward development consulting company its fifth let y’s inde to where thin project by Atlanta-based Seefried he said been met since the beginning of the year. pendent oper has been revealed for the Ponti- alone sists of casu . — Jaishree Ings will go,” Bonner Advisory Group LLC. 50 to 100 acres. al denim, Drepaul-Br dustrial Properties Inc. have been Real estate experts see the progac Silverdome property, a 127-acre accessori uder along with “These larger sites at some point scarce These are good lifestyle prod so far, although there is a Sept. ress as signs of optimism for new deswath that for years had been a major ucts such sential oils. were going to come down and accomThose items 18 public hearing of the Pontiac things.” velopment, particularly industrial blemish in the Oakland County seat. are mostly modate that. There’s a dearth of space in Planning Commission scheduled for and distribution, in one of the naWhether it’s the Palace of Auburn — Luke Southeast Michigan. It’s difficult to find Fou wealthiest Bonner, CEO er, Natur the project, according to a notice tion’snd Hills that’s facing the wrecking ball later counties. alic 20 acres, let alone 50 to 100 acres. These ious of Bonner Advisory Group LLC posted last week to the city’s website. “It’s representative of the need for are good things. The market’s been pretn 2015, Gw SEE SILVERDOME, PAGE 32 en hair care pro Jimmere, founder of crainsdetroit.com Vol. 35 No. 35 natural duct compan $5 a copy. $169 a year. © Entire contents copyright 2019 by y Naturalicio came the Crain Communications Inc. All rights first African reserved us, beAmerican hold a pate woman to nt for a natu ral hair pro She was surp duct. rised when she learned blazing acco Michelle Aristeo Barton, 34 and Anne Aristeo Martinelli, 39 of her trailmplishment. “I thought ‘Are you kidding don40 me? No one e this UNDER ?,’” Jimmere 40,said Page else has 8 M . “It’s been Black History surreal. Eve Month I get ry tons of med and invitatio ia inquiries ns toTO BROUGHT YOU spe BYsch ak at myDELTA picture DENTAL MICHIGANools. Teachers hav up onOF bull e etin boards like Dr. Mae next to peo Jemison and ple Martin Luth Jimmere is er King Jr.” happy to sha with young re her success and old alik stor y e. It started she was laid in 2013, whe off from a cus n hy corporat Motor Co. e job at Ford The timing was terrible who had rece for Jimmer ntly left an e, abu was the new ly single mom sive marriage and messy divo of a 1-year-o Kate Baker, 39 rce trial left ld. A her with just bank. $32 in the “I was forc W ed into entr epreneurshi said. “I look p,” Jimmere ed at my son and realized was not an that failure option. I nee ded him to when things know that fall apart we don’t just fall make things down. We happen.” And she mad e thin gs happen in turning her a big way by personal hob hair care pro by of mak ing natural ducts into a business over 36,000 that impacts wom 1,200 retailers en yearly. Naturalicio us is now in nationwide, stores and including Sall Whole Foo ds. It also laun y Beauty online Ulta ched in the Beauty stor e. “We get ove r 3,000 orders site alone, a month on and that doe our websn’t include retailers or orders from salons,” Jim mere said. in my kitchen “This all star and now the ted be a 3,700-squar setup that has e-foot facility” company occupies a allowed me ers. I employ in Livonia. She stresses to help so man special nee that her win y othds workers tion line. And one. s are wins on my produc “I was forced for everyour return cus in an industr tomer rate into entrepren “The setback is 74 percent y where the I had six yea eurship. average repe rate is 11 perc I looked at my rs ago turn my produc at customer ed out to ent to 18 perc ts are tran son and realize three quarter PORTRAITS ent. That mea sformative life-changin BY JACOB LEW d that s of our cus ns g — becaus — lite alm fail ost KOW FOR CRAI ure was not an tomers retu e our produc much time, N’S DETROIT rn and say option.” ts save them frustration BUSINESS that and money. “World dom ination wou run,” Jimmer ld be nice e said, “but in the lo empowering a big victory. people is a ” — Jaishree Drepaul-Br uder
R
UNDER
Silverdome deal seals 2019 as a big year for
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ichelle Aristeo Barton and Anne Aristeo Martinelli are the next generation of leadership at the growing Livonia-based Aristeo Construction Co., founded by their father Joseph Aristeo and grandfather Agostino Aristeo in 1977. They are also a bit of a rarity: Women in the male-dominated construction industry, in which more than 90 percent of the workforce is men, according to data from the National Association of Women in Construction. The health of the automotive and supplier and utility markets has been key for the company, which employs more than 700, as it has gone from about $448.6 million in 2017 revenue to $470 million last year, an increase of 4.77 percent (the company expects revenue to remain flat this year). In 2004, it had 220 employees and $100 million. “(The) automotive and utility sectors, the growth of the Michigan Three plus Toyota and Nissan have helped fuel our expansion,” Aristeo Martinelli said. The sisters took different paths to their current president and chief strategy officer positions, respectively. Aristeo Barton graduated from Duke University (BA) and the University of Michigan Stephen M. Ross School of Business (MBA), but got her first taste of working in the family company when she was just 7, when her father “let her” answer phones on Saturdays. After college, she returned to take an HR role and rotated through various positions, including leading Aristeo’s minority business enterprise, Stenco Construction LLC, from 2014-17 before beginning the transition from Aristeo EVP to president, starting a year ago. “I have been here since I was a punk kid,” Aristeo Barton said, chuckling. “I did little odds and ends, a couple internships and then started full time.” Aristeo Martinelli, however, worked for 15-plus years in the retail and consulting sectors in the Bay Area and Chicago after graduating with her BA and
MBA from Stanford University. “[Swimming] She worked for Gap Inc. and The Boston Consulting Group. taught us at a She most recently served as very early age COO/senior practice manager for McKinsey & Co.’s North ... that you American Consumer Practice in Chicago before returning to have to work metro Detroit to become Aristeo’s chief strategy officer, for something.” which puts her in charge of strategy, marketing and busiAnne Aristeo ness development. Martinelli “In the spring 2017, my dad called me and said, ‘I think we need to start going through our official transition,’” she recounted him saying. “‘This is your last opportunity to officially be involved in the business in a way
“I have been here since I was a punk kid.”
you would want to be for awhile. Would you like to consider moving back to Detroit?’ At that point, we talked about what that would look like for our family and how I could help the rest of the management team in the transition.” Both sisters are also accomplished swimmers; Aristeo Martinelli swam for Stanford, while Aristeo Barton swam for Duke. “There is a lot of delayed gratification. You are training for a decade to have a race that’s two minutes long, and it ties with what we are doing,” Aristeo Martinelli said. “It taught us at a very early age, outside of academics, that you have to work for something.” — Kirk Pinho
Michelle Aristeo Barton
Executive Director, Oakland Housing
hen all was said and done, Kate Baker and her team had taken part in 300 public events in 365 days — and had helped collect 500 oral histories. Her efforts were in the creation and support of Detroit Historical Society’s award-winning Detroit ’67 exhibition — the project that Baker calls “the most important work I have done.” Baker was chief community and operations officer of DHS at the time of the exhibition. “Everything that was happening in our country with race relations so closely mirrored what happened in Detroit in 1967; it would have been irresponsible of us to not dig into this issue,” Baker said of the year-long community outreach effort that significantly changed how Detroit Historical Society approaches public history in the city. “It could not just be photos on a wall with a box of text next to it. This was visceral. The opportunity to bring individual voices into a space usually dominated by white academics was powerful.” Service to her community has always been a driving factor for Baker. With a bachelor’s degree in government and urban studies from Smith College, a master’s in urban planning from Wayne State University and a career path in community development, Baker’s new position as executive director of Oakland Housing allows her to sync all her passions. Oakland Housing is a nonprofit that seeks to support middle class housing with loans, mortgage advice and building opportunities. “The middle class that helped drive American prosperity is very squeezed,” Baker said. “They are working people in a very restrained income space —
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40 40
UNDER
President Chief Strategy Officer Aristeo Construction
W
e may live in the connected era, but connection, besides being an old-fashioned adage of business success – “it’s not what you know, it’s who you know” – is part of the basic business of human society. Our lives depend on collaboration, community and what we do together in our organizations, institutions and neighborhoods. These 40 leaders embody connection: some went to the same schools, or the same business accelerators, or share coworking space. More importantly, they’re connected to each other through their work on Michigan’s most pressing issues: technology, inclusivity and opportunity for all. Pages 8-9
John Haji
Ryan Hertz
Gwen Jimmere
Roslyn Karamoko Pages 18-19 Tina Kozak
Alexander Leonowicz Lisa Ludwinski Pages 20-21
Jason Mars and Lingjia Tang Nathan Martin
Brian McKinney
Palencia Mobley Pages 22-23
Jon Oberheide Devon O’Reilly
Michelle Aristeo Barton and Anne Aristeo Martinelli
John Perkovich
Kate Baker
Pages 24-25
John Barker
Dayne Bartscht Pages 10-11
Allandra Bulger Aaron Burrell
Ryan Cockerill
Chris DeRusha Page 12
Ward Detwiler
since the recession,” Baker whether from student “The middle class that helped drive said. “We are trying to reloans or overpaying rent — that can’t save for a down American prosperity is very squeezed.” build that.” Baker believes Detroit’s payment.” rebound will come from Baker is excited for Oakland Housing’s latest project, a development of 14 home ownership in neighborhoods where the proptownhouses in Corktown. The goal is to help renters erty will appreciate and owners can make investments for the long term. already living in the neighborhood, or people with As someone driven to be of service, Baker said, “the family in the neighborhood, buy in the neighborwork I find important or fulfilling does not necessarily hood. involve climbing a corporate ladder.” — Laura Cassar “Black home ownership was lost in the last decade,
Pages 16-17
Anya Eliassen
Robert Platt Luke Polcyn
Timothy Ponton Portia Powell Page 26
Summer Ritner
Tiffany Sanford Greg Schwartz Pages 28-29
Javier Evelyn
Alissa Sevrioukova
Pages 14-15
Matthew Walters
Mike Flores
Dan Ward
Dandridge Floyd
Gabrielle Sims White
Jocelyn Fuller
PORTRAITS BY JACOB LEWKOW FOR CRAIN’S DETROIT BUSINESS
Garlin Gilchrist
PAULINA PETKOSKI, STYLIST
FOCUS | WOMEN IN SKILLED TRADES From Page 11
“And I did it, and he goes, ‘You want a job? You picked that up immediately. You need to paint.’” She’s been painting full time ever since. Here in Detroit, she collaborates closely with two other companies that do drywall and other complementary work. “We’ve been tight for almost three months now, and it’s great. We just work together and get jobs together and get stuff done.” Painting, like many skilled trades, is dominated by men. Mazzola said she’s never met another woman painter in real life, although she has connected with many of them through social media. She hasn’t exactly felt discriminated against because she’s a woman. But she explained that she gets annoyed when she gets extra praise when people are surprised that she’s so good at her job. Someone will exclaim, “She’s so good — and she’s a girl!” Mazzola said that while on jobs, women often say to her, “Wow, I wish I could do that.” She encourages them to try it if they’re interested. But becoming a professional painter is not as simple as “just throwing some paint on the wall,” she said. “It takes skill, knowledge and practice. It’s not just about rolling a wall out. You’ve gotta know what product to use where, and what kind of naps to use on different textured surfaces. You can’t just pick up a sprayer and expect to be able to spray,” because without the right experience, you can cause some major problems. The painting business has brought together several things that appeal to Mazzola. Along with the artistic element and working with her hands, she said, “I like being outside, I like being on ladders, I like remodeling. And I like seeing a happy homeowner.”
“ WE’RE REALLY DOING A LOT NOW TO TRY TO ACTIVELY RECRUIT WOMEN IN THE SKILLED TRADES AND PROMOTE WOMEN WITHIN THE SKILLED TRADES.” — Jen McKernan, communications director of the Michigan Regional Council of Carpenters and Millwrights
GETTY IMAGES/ISTOCKPHOTO
PAINTING
TRADES
From Page 8
“I think that Michigan is one of several states that is working really hard to promote the skilled trades at a state level,” McKernan said. “We’re really doing a lot now to try to actively recruit women in the skilled trades and promote women within the skilled trades.” Neely wants people to able to see more women in construction. “Representation is everything,” she said. “So the more that people
ELECTRIC
From Page 11
Neely is a member of the National Association of Black Women in Construction and is the former Detroit chapter secretary. “I attended that first meeting and literally fell in love. It was so powerful being in a room full of like-minded women,” she said. “A lot of us have some of the same issues, and just being able
can see themselves, they’ll be like, ‘Oh, OK, well, if she can do it, I’m pretty sure I can give it a shot.’” Many women have told McKernan that they thought they had to know the trade before they started an apprenticeship, she said. “I think that a lot of people don’t realize that unionized apprenticeships in the skilled trades are four-year training programs where you’re paid to learn, and you graduate with no debt.” But investing in vocational programs and high school pro-
grams can help expose young women to the skilled trades, McKernan said. Her group ran a summer camp last year for kids in junior high and high school, and girls who participated told them, “I didn’t know I could like this. I didn’t know I’d be good at this.” Getting more women into the skilled trades will require “an ongoing process of recruiting and training and promoting,” McKernan said. “But we’re definitely seeing an influx now like we’ve never seen before, and it’s terrific.”
to kind of lean on each other (and) help with resources — it was just amazing to me. So I’ve been hooked ever since.” In 2018, Neely entered DTE’s Bright Ideas pitch competition. Her pitch was to create a workforce development program for youth, and she won first place. It was supposed to be a $500 prize, she recalled, but DTE’s president and COO, Trevor Lauer, told her he was so impressed with her that he was going to add
another zero to that check, and gave her $5,000. Three weeks later, she won $10,000 in another pitch competition at Essence Festival in New Orleans. Since then, she said, “I’ve been working with some educators and electricians, alongside DTE, to create this workforce development program.” They are in the process of working out the details, including potential ways to get middle school children involved.
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PEOPLE ON THE MOVE 14 | CRAIN’S DETROIT BUSINESS | APRIL 13, 2020
ETHOS
From Page 8
The process has included a year of community engagement, using storytelling to preserve neighborhood stories and community design-build workshops that engage and educate public stakeholders. “Hopefully by the end of the year, we’ll be launching our AGI Design Build Green Hub, where we are at the center of our neighborhood, building wealth from the bottom up, prioritizing growing capacity and opportunities for other minority contractors and locals,” said Saldivar-Ali, who is Hispanic. People are often surprised that Saldivar-Ali is at the helm of this construction company. Sometimes, if Luis is there, “they assume because he is the man that he is the one making all the executive project decisions and always the person to communicate with directly,” she said. “I’ve had a few men that push back and totally ignore me,” she said. To prevent that, she’s always conscious of how she carries herself. For example, she said, “when I talk, my shoulders are squared off, and I’m making direct eye contact. And I’m being very specific about what I’m asking or what I’m looking for.” Saldivar-Ali thinks women are more accepted in the industry now, in part “because of the simple fact of labor shortage within the construction industry,” she said. “Detroit used to have trade schools, and back in the early 2000s, they were all shut down. The few fractured pipelines that we did have were all cut off.” She is working with other organizations to figure out how to create new pipelines. “I think there are a set of kids in the schools that don’t do well in a traditional school setting (who) are built for trades — (who) would excel in trades,” she said, but they get written off because they don’t fit the mold for college. “I think we should do a better job of identifying kids that are naturally bent” toward skilled trades. Saldivar-Ali recently spoke to a group of 75 high school girls as part of a panel on women in construction through Ideal Contracting. “I told the young ladies that women are natural builders. We build our families, we build our homes, we build communities. And you know, we are excellent at multi-tasking and project managing,” she said. She added that the design-build ecosystem “needs to be more diverse and visible, especially for people of color, women of color and Detroiters, because we understand how to build and fix our own communities.”
Homes for sale by county
SPORTS BUSINESS
Residential and condominium sales in Wayne, Oakland, Macomb and Livingston Counties. Each datapoint equals one month of activity. Data is from April 6, 2020.
USPBL founder still optimistic about rescuing baseball season
7K Wayne
Oakland
Macomb
Livingston
6K 5K
BY KURT NAGL
4K
The United Shore Professional Baseball League is delaying the start of its season at Jimmy John’s Field in Utica due to the pandemic. The professional baseball league was scheduled to start playing May 8. It has now set a target date of May 29. League founder Andy Appleby said he knows that could change depending on how the health crisis shakes out. There Appleby are advantages to independently owning and operating a small league, such as the flexibility to move games around with little difficulty. There are also disadvantages — mainly, having less of a cushion than major pro leagues to absorb financial blows. “It’s a huge threat, not in the sense that we’ll go out of business or anything because we can’t really afford to do that,” Appleby said. “We built an $18 million privately funded ballpark, which is very atypical.” The USPBL is entering its fifth year. A couple of weeks ago, Appleby would have said this will be its best year, in
3K 2K
April 6, 2020
1K 0
JAN. 2017
JAN. 2018
JAN. 2019
JAN. 2020
SOURCE: REALCOMP II LTD.
HOMES
From Page 3
Pending sales, another key barometer, are also sharply down, with 4,063 in the four-county region last month. That’s 18.5 percent lower than March 2019 (4,983 pending sales); 22.4 percent lower than March 2018 (5,237 pending sales) and 26.2 percent lower than March 2017 (5,502) pending sales), according to data provided by Realcomp. Pending sales in the MLS plunged 21.2 percent from 7,738 to 6,096. “This would have been where we would really start ramping up,” said Frank Tarala, chair of the Realcomp board and principal broker for Sterling Heights-based Sire Real Estate. “People are gonna move for schools, people are gonna move for whatever reason. But this is the time of year historically where they do it the most often. “I don’t know if I want to go see a baseball game in November. I don’t know if I want to sell my house in November, either. Mentally, that’s just not what I’m used to.” The region’s inventory of homes and condos for sale also fell 11.8 percent from 11,505 in March 2019 to 10,142 last month. That’s up 4.5 percent from March 2018 (9,703 homes for sale) and down 5.5 percent from March 2017 (10,735 units for sale). New listings across the entire MLS dropped 20 percent year-over-year from 10,628 to 8,501. Mortgage applications, despite low interest rates, have also dramatically fallen. Applications nationwide dropped 17.9 percent in one week, according to a Mortgage Bankers Association survey released last week. Purchase applications, which hint at future activity, slid 12 percent in a week, and a whopping 33 percent from the same week
last year. It’s far worse in regions where COVID-19 is raging, according to the Associated Press. Compared with last year, purchase applications tumbled February 17,in2020 38 percent Washington state and 31.3 percent in New York which reDecember 2019 corded 7312,new coronavirus deaths, the biggest one-day jump yet. California reported a 15.9 percent drop in applications. “Mortgage applications fell last week, as economic weakness and the surge in unemployment continues to weigh heavily on the housing market. Purchase activity declined again, with the index dropping to its lowest level since 2015 and now down 33 percent compared to a year ago,” said Joel Kan, the Mortgage Bankers Association’s associate vice president of economic and industry forecasting. “With much less liquidity and tighter credit in the jumbo market, average loan sizes declined, and mortgage rates for jumbo loans increased to a high last seen in January.” Jumbo loans are those that exceed the servicing limits of Fannie Mae and Freddie Mac, which right now is $510,400 with few exceptions. Real estate agents nationally remain optimistic that the slowdown will be short-lived and merely delay sales, not cancel them altogether. “Home sales will decline this spring season because of unique economic and social consequences resulting from the coronavirus outbreak, but much of the activity looks to reappear later in the year,” said Lawrence Yun, the chief economist for the National Association of Realtors in Washington, D.C. “Home prices will remain stable because of a pandemic-induced reduction in inventory coupled with less immediate concerns over foreclosures.” Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB
CRAIN’S DETROIT BUSINESS
The USPBL has pushed back its baseball season at least three weeks because of the coronavirus outbreak. | CRAIN’S DETROIT BUSINESS
terms of attendance and revenue. S DETROIT BUSINESS Now,CRAIN like ’business owners and people across the country, he’s not sure ’S DETROIT BUSINESS aboutCRAIN anything. “We could still have our best year ever, but obviously we’ll have to play the games to do that,” he said. Early April is typically the peak of selling season for the league, but would-be corporate sponsors have taken a big step back. A silver lining is that fans can likely look forward to more talented play this year, if and when the season starts. When the NCAA canceled the remainder of the college baseball sea-
son, the USPBL was flooded with tryout requests from affected players looking to get their reps in. Appleby said he doesn’t want to rush things, but he’s optimistic about playing ball this season before other pro leagues are able to sort out the logistics of restarting. “Even if it has to be July 1 or Aug. 1, you know, we’re going to play,” he said. “I think at some point in the not too distant future, people are going to want to get back to normal.” Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl
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Mortgage applications, despite low interest rates, have also dramatically fallen.
Business Development Sales Associate The Global Polymer Group is looking for a Business Development/Sales Associate who will be expected to work with inactive accounts and new prospects to pre-sell the brand with the objective to set up a meeting with the Regional Manager. They will work with the sales team to help
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APRIL 13, 2020 | CRAIN’S DETROIT BUSINESS | 15
PPP
From Page 1
“And as great as this program is and is meant to stimulate the economy and help retain these jobs ... a small business is sitting there going, ‘wait a minute, I’ve got my bank telling me this and my CPA telling me that.’ I think that’s taking what is unilaterally good for small business, (but) is still not taking away the anxiety as much as some small business owners would like.” Still, many CPAs last week responding to a survey from Crain’s said they were seeing loan applications moving forward at a variety of Michigan lending institutions, and banks toward the end of the week were just beginning to disburse the first payments.
New Bohemian Cafe proprietor Kevin Murphy | CHAD YERRICK
Taking the ‘zen’ approach There’s no shortage of small business owners feeling anxiety as statewide stay-at-home orders are being extended through at least the end of April. But some are also acknowledging that the global situation is well beyond the scope of any one person’s control, so it’s a good time to simply hunker down and hope for the best. “I’m taking a zen view of this,” said Kevin Murphy, who co-owns the New Bohemian Cafe located in the summer tourist hot spot of Northport on the Leelanau Peninsula 40 miles due north of Traverse City. Murphy and his wife, Amy, opened the deli, coffee and wine shop last
FLAWS
From Page 1
Her husband, Jon, also got laid off from his job as a production supervisor at a machine shop in Plymouth. Jon Robertson’s $362 weekly unemployment check was initially approved, and then the online system showed it was denied, the wife said, causing “panic” to set in about how to feed four children ages 1 to 14 in the coming weeks. “We have a screen shot that said he was approved,” Jessica Robertson said. “We have no idea what’s going on.” Some workers report that a missing hyphen in their last name screwed up an online application, requiring hours of calls to reach a state worker in Lansing to correct the typo. Others forced out of their jobs last month told Crain’s they get an online notice to check their email or mobile phone for an authentication code, but the code never comes. “I clicked to get my text and I never got it. So I couldn’t log in. And that’s basically what’s been going on since,” said Adam Pressley, 34, of Highland Park, who got laid off March 15 from his server job from the Green Dot Stables bar in Detroit’s Corktown. “There was an option to get (the authentication code) by text, email or both. I think I put both. And I’m not getting either.” Detroiter Christina Otto, 48, said she also ran into the authentication code roadblock. “That’s where I’m stuck,” said Otto, who lost a home care job because of the coronavirus threat. “(The website) told me to call the number and I’ve been repeatedly calling the number and it’s either a busy signal or (a message) will come up saying they’re extremely busy and not taking any calls.” Pam Coultis, a laid-off administrative assistant at Hagopian World of 16 | CRAIN’S DETROIT BUSINESS | APRIL 13, 2020
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year. He told Crain’s that July and August of 2019 accounted for roughly half of their yearly sales. He said he remains hopeful that the store can open for those months this year. “I’m thinking in terms of whether there will be a summer tourism season in our community and if there’s
Rugs in Birmingham, considers herself “fairly computer savvy” but found the state’s system incomprehensible when she “finally” was able to log in at 3:30 a.m. on Saturday, April 4. “It was almost impossible to follow the instructions as they were laid out,” she said. “It was terribly frustrating.” Democratic Gov. Gretchen Whitmer has blamed the problems on “years” of disinvestment in the technology systems that have seen filing volumes in three weeks equivalent to total unemployment claims in 2018 and 2019 combined. Michigan is not alone; other states have seen online unemployment filing systems crash from the “incredible number” of people put out of work during the coronavirus pandemic, Whitmer said. “I don’t give that as an excuse because we’ve got to get it right,” Whitmer said Thursday. “But I do give that for perspective — this is an unprecedented number of people looking for help.” Coultis, a self-described Democrat from Redford Township, said she blames the Whitmer administration for being unprepared for scores of people being put out of work by her executive orders. “If, as a governor, you’re shutting businesses down, you should be prepared for the onslaught,” said Coultis, 70, who has worked in Hagopian’s corporate office for 30 years. “She was not prepared for it.” The state’s Unemployment Insurance Agency has taken steps to handle the volume of claims for a $362 weekly benefit. They’ve quadrupled the number of employees in the agency answering phones and processing claims, said Jeff Donofrio, director of the Department of Labor and Economic Opportunity. On Friday, the labor department said the unemployment agency had launched new tools for users of the
not, what does that mean?” Murphy asked, adding that if indeed establishments are unable to open for the final half of summer, it will be the end of many businesses. Columbus-based Huntington Bank, the state and country’s largest SBA lender, is the only bank located in the Northern Michigan village, so Murphy said he does his banking there largely out of necessity, but added that he very much likes the staff in the Northport branch. Murphy said he got his PPP application in just before the lender hit pause midweek last week on accepting new applications due to overwhelming volume. Murphy said he received confirmation that his appli-
MILogin and Michigan Web Account Manager systems to report technical issues. “I would say 95 percent of people are getting through and filing their claims without any problem,” Donofrio said last week. William Blunt, 27, of Detroit, said he’s been struggling to file an unemployment claim since being laid off March 28 from a factory job at Magna Automotive in Warren. Blunt said he’s been locked out of the system after numerous attempts to reset a password.
“IT WAS ALMOST IMPOSSIBLE TO FOLLOW THE INSTRUCTIONS AS THEY WERE LAID OUT. IT WAS TERRIBLY FRUSTRATING.” — Pam Coultis, a laid-off administrative assistant at Hagopian World of Rugs
Blunt said the state unemployment agency offices should be reopened to accommodate workers who cannot get past the technological troubles of the current system. He suggested the state erect plexiglass at counters to protect state workers and residents from spreading the coronavirus. “They need to reopen the unemployment office and let in 10 people at a time ... the ones who cannot log in,” Blunt said. Donofrio acknowledged the closure of unemployment agency or Michigan Works offices: “because of the desire to flatten the curve and stop the spread of (coronavirus), really the phone lines are our only alternative right now.” “We appreciate the patience that people are showing as we try to process this massive amount of claims,” Donofrio told reporters on April 6.
cation was in Huntington’s queue but said he still feels he lacks clarity on multiple points when it comes to the minutiae of the PPP process. Ultimately, he’s falling back on his “zen” thought process of whether he’ll be able to bring back his half-dozen employees, some of whom are struggling with the stressed unemployment insurance process. “Like everything else, I am but a puff of dandelion fluff in the air being swept where the breeze may take me,” Murphy said. Murphy is far from alone in feeling a general lack of clarity and guidance, even as the PPP enters its second full week this week, as questions remain particularly around definitions of compensation and who specifically can be eligible for loans. While the struggles of financial institutions such as Huntington and Comerica to implement PPP systems were well-documented last week, accountants note that the banks are “drinking out of a firehose” and give them relatively high marks for their work. “I think the banks are in very similar positions as we were as professionals. You’re taking imperfect information and you’re trying to work with it and set up something as best as you can,” said Ali Baydoun, a principal in the Farmington Hills office of CPA firm UHY LLP. “To me, the disappointment doesn’t come from the bank perspective, it really comes from the fact that guidance was very, very slow to be issued.”
But patience is running thin for some Michigan residents whose bank accounts are running low as a second pay period approaches without a paycheck on the way. “We’re beyond frustrated,” said Robertson, the out-of-work wedding photographer. “And now the panic is starting to set in because we thought we’d be OK with the unemployment, at least (my husband’s) right away. I wasn’t counting on getting anything. But we’ve got nothing.” Even when they have broken through jammed phone lines and an online system that’s experienced almost daily crashes, jobless workers seeking access to Michigan’s financial safety net say their applications have been hamstrung for weeks, especially if they had more than one employer or changed jobs in the past six months. “Everyone I know has a hard time getting into the unemployment system. Like days, if not weeks,” said Christopher Sanders, 51, who lost his job at an aerosol factory. Sanders has been trying to navigate the system completely by mobile phone because he doesn’t have access to a home computer. “And you can’t go to the library to use one because they’re all closed,” he said. One of the common problems jobless restaurant and bar employees have faced is their applications for an unemployment check have been held up because they switched jobs or were holding down multiple jobs, which is common in the hospitality industry’s workforce. Katie Kelsey, 27, in Wyandotte, a waitress at the Truago restaurant in Trenton, said her unemployment claim is being held up while the state agency investigates why she quit her previous job on good terms. “I feel like if it’s a state-mandated shutdown of the state you need to be giving people something to live off, es-
Who’s eligible? Also creating headaches for some is just what types of companies can apply for the loans. Take Southeast Michigan startup technology companies. As more of them find themselves the beneficiaries of venture capital largesse, with that comes increased difficulty in applying for PPP loans. That’s because the SBA’s “affiliation rules,” which essentially make workers at startups employees of the venture capital fund, often put them over the 500-employee threshold. The issue, said Chad Kime, a partner at the UHY accounting firm, is the lack of a hard-and-fast rule. “A lot of those affiliation rules are determined on a case-by-case basis. You have to look at it where there’s no bright-line test, so that’s the difficulty,” said Kime. “We have found that several of our private equity groups we work with just don’t qualify because of that affiliation rule.” Advocacy groups like the National Venture Capital Association have sought clarity on the issue and practitioners like Chris Rizik, CEO and fund manager of Ann Arbor-based Renaissance Venture Capital Fund, hopes they’re successful. “Because Southeast Michigan has so many early-stage, venture-backed companies that are vulnerable at a time like this, the PPP loans would be particularly helpful,” said Rizik. Contact: nmanes@crain.com; (313) 446-1626; @nickrmanes
pecially when they expect to have funds every week or every day, however their job pays them,” Kelsey said. “It’s going on four weeks. People can’t survive.” Jori Trelfa, a bartender at Royal Oak Taphouse, said she was approved March 20 for $293 in weekly unemployment benefits. But a week later she received a debit card with no money on it. She has since learned the unemployment agency is doing a “fact finding” inquiry for a job at a Waterford bar that she left last fall. “I talked to someone about a week ago and they told me that there’s ‘nothing we can do’ and I just have to sit and wait,” said Trelfa, a 36-year-old single mother of two children from Oak Park. Some workers stranded at home during the pandemic said applying for unemployment benefits has become a daily mission. “The time I used to spend on my actual job I’m dedicating the same number of hours to proving I don’t have a job right now,” said Lauren Waters, a 26-year-old Wayne State University graduate student from Madison Heights. Waters lost her day job as a research lab manager at Wayne State as well as her night job waitressing at One-Eyed Betty’s bar in Ferndale. The millennial pursuing a master’s degree in social work resorted to using the 20th Century technology of facsimile to send the unemployment agency documentation and letters. “At least if I fax something, I get a confirmation that it sent,” Waters said laughing. “Whereas these other forms of communication I don’t. I think I’m going to be using carrier pigeons (next) or something. Maybe smoke signals.” Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood
HOSPITALS
From Page 1
“When the dust settles and when we have made it through the worst of this crisis, and hopefully that day is coming sooner rather than later, there will be an opportunity to learn a great deal about our health care delivery and financing system,” said Brian Peters, CEO of the Michigan Health and Hospital Association, which represents 157 hospitals. “The list of opportunities for improvement is growing,” said Peters. “It’s going to be a lot longer a month or two months from now. We will know all the things we were not as prepared for as we could have been.” The strain on metro Detroit’s health care system has exposed the need for “better coordination, better communication between health care systems,” said Nabil Suliman, M.D., owner of Premier Medicine, a primary care and urgent care physicians group with clinics in Livonia, Dearborn and Hamtramck. “You can see how fragmented this effort has been,” Suliman said. “Testing’s been sporadic, different protocols, different approaches.” If there were a cohesive approach in the health care system, Suliman said, “then you would see the big health care systems, instead of competing, trying to work together, trying to coordinate, trying to share the knowledge, trying to share the experience. “And I don’t see this happening, unfortunately,” Suliman added. In Michigan, COVID-19 as of Friday had killed more than 1,200 people and infected at least another 25,000-plus people over the past month. Experts say the numbers may be underreported as some deaths have been initially categorized as pneumonia or heart attacks. While the number of daily positive cases statewide and in certain cities, including Detroit, appeared to level off or drop late last week, the number of daily deaths and hospitalizations continued to climb and health experts warn blips in slowing are possible. Gov. Gretchen Whitmer said last week hospitals are days away from running out of personal protective equipment, or PPE, as the number of cases climbs. Donations have increased and the federal government recently transported a large number of N95 masks, but frontline health care workers continue to complain about rationing. “At Beaumont hospital we have less than three days until N95 masks run out. At Henry Ford Health System we have less than four days; and at the Detroit Medical Center, less than 10 days,” Whitmer said. “At all three health systems there are less than three days until face shields run out, and less than six days until surgical gowns run out.” Moreover, more than 3,000 health care workers in Southeast Michigan have become ill with COVID-19 or have placed themselves in self-quarantine as a precautionary measure. Those numbers are growing as well. The data is incomplete because some health systems refuse to disclose numbers. Some medical experts fear once the current emergency is over, political leaders and hospital executives will go back to bickering over holding down budget deficits and rising health care costs instead of focusing on real solutions. They say permanent changes in health care delivery and financing should be made because future killer outbreaks should be expected.
Left to right: Alison Granados, M.D., and Trini A Mathew, M.D., of Beaumont Health, which has had more cases than any other system in the state. | CONTRIBUTED
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“Inertia is a powerful force. (After a crisis is over), people tend to step back to their baseline position,” said Mark Schweitzer, M.D., incoming dean of the Wayne State University School of Medicine, the largest single-campus medical school in the nation. “I hope we learn from this and change.”
Is the peak happening now? But the current crisis is still very much a reality for the health care workers on the front lines, prompting many to wonder when the tunnel will start showing some light. Depending on the geographic market, predictions when positive cases and hospitalizations will peak varies because of patient volume experience and different models used by hospitals, officials told Crain’s. Top doctors at Detroit’s two largest hospitals — Henry Ford Hospital and Detroit Medical Center — predict the worst of the expected patient surge will hit ERs this week, starting Sunday, April 12, and maintain intensity over the next two weeks. Henry Ford Health System’s predictive models show peak ER visits and hospitalizations will hit its six-hospital system Sunday and early into the week, said Steve Kalkanis, CEO of 1,200-member Henry Ford Medical Group. “We’ve been in active preparation mode for the last five days” and into this week, Kalkanis said. “We believe (this will be) the brunt of it. I would not say we are in crisis mode. We’ve spent the last month preparing for this moment.” To increase inpatient capacity for the surge, Henry Ford created a mini-hospital at Fairlane Medical Center in Dearborn and opened another building in Detroit that will be able to house about 60 stable patients, freeing up beds for more serious patients, Kalkanis said. “What this is doing is allowing patients who are inpatients currently in the hospital but aren’t quite well enough to go directly home” to go to a step-down unit, he said. “Maybe they’re waiting to go to a skilled nurs-
ing facility. Maybe they need some level of care, but not necessarily intense care. But we can’t send them home.” Kalkanis also said from April Chopra 6-8 Henry Ford doctors took more patients off ventilators successfully than have needed to go on them. “To me, that’s the single most impactful metric because it just shows not only how many patients are out in the community or who are admitted, but those who are really, really sick and need of ventilators,” Kalkanis said. “We seem to be leveling off” ventilator use. Another good sign is that Henry Ford has discharged 931 patients in last 30 days with average stay of 7.68 days in intensive care, indicating early treatment helps. It currently has 714 COVID-19 inpatients, officials said. Teena Chopra, M.D., DMC’s corporate director of epidemiology, said COVID-19 has exposed Detroit’s broken public health system and fragile health care infrastructure. She said high incidence of chronic disease, poverty, low literacy rates and lack of trust in the medical system of many inner-city residents contributes to the high numbers of cases and hospitalizations in Detroit. “We will see even worse than what we are seeing today (last Thursday). We haven’t peaked yet. We are going to see a lot of cases; we are going to see a lot more deaths. We are on the exponential phase of the epidemic curve,” said Chopra, who also is a professor at Wayne State University School of Medicine. Over the last two weeks, DMC has been sending stable patients to Ann Arbor hospitals to clear beds and resources for an even greater expected surge of patients, Chopra said. DMC also will send patients to the field hospital set up at the TCF Center in Detroit, she said. Robert Takla, M..D., chief of emergency medicine at Ascension St. John Hospital in Detroit, said predictive models vary for when the peak on ER visits and hospitalization will occur. He said it’s difficult to pick a date on the calendar for when the peak will occur. “There’s still growth that’s happening. ... We’re frequently close to our maximum capacity and then we have the ability (to take more) patients. Other times, it’s best to transfer,” Takla said. “My belief is that we haven’t
reach a peak in terms of maximum cases. ... However, (Wednesday and Thursday), the rate started to increase again. It’s going to take a little bit of time to have accuracy.” Officials at Beaumont Health, which has publicly acknowledged the most deaths in Michigan with more than 312 and more than 4,100 patients hospitalized or discharged with COVID-19, has charted a flattening of confirmed hospitalized COVID-19 cases. Beaumont officials have been unavailable for interviews with Crain’s. At the University of Michigan Hospitals in Ann Arbor, chief hospitalist Vineet Chopra, M.D., said the big patient surge is expected over the next two weeks. Chopra said the Michigan Medicine team he leads of 129 hospital medicine doctors and 30 advanced practice nurses have been extremely busy caring for an increasing number of patients transferred from Detroit hospitals and coming in from upstate and western Michigan on survival flights. “We are seeing more patients come to ER, but we are taking many patients from other institutions: Henry Ford, Beaumont and DMC,” said Vineet Chopra, who is not related to DMC’s Teena Chopra. “They are completely overwhelmed with critical care and beds and we have been taking transfers everyday. The next couple weeks will be tough for us. It’s going to get worse before it gets better.”
Helping stressed workers Under crisis conditions, hospitals are offering doctors, nurses and health care workers a variety of ways to alleviate stress and fatigue they feel as they care for very sick and dying patients. “Obviously there is a huge amount of stress,” Takla said. “We are getting a little tired. We encourage each other to take care of ourselves. Like what they say on the airplane: Place the air mask on yourself before others. Many are sleeping in different areas of the house to lower risk of possible transmission. My daughter would rather live in her apartment in Ann Arbor than come home.” Like all health systems, Ascension provides resources such as virtual counseling seven days a week to deal with the stress of seeing many fatalities, Takla said. “Someone placed a ‘Heroes Work Here’ sign in front of the hospital,” Takla said. “That is extremely uplifting. It makes us feel like we’re appreciated and recognized. When you have little (energy) left, that somehow fills up the tank.” At Henry Ford, Kalkanis said multiple wellness programs are available, including physician-to-physician hotlines and nurse-to-nurse hotlines, and quiet zones where staff can go to decompress. “I would say that stress is very high as you would imagine, but morale is high as well,” Kalkanis said. “We have our wellness teams working around the clock to identify people on each shift. ... We’ve made hotels available for staff who are worried about being exposed and not wanting to carry the virus home to their families.” Chopra at DMC said the health system also is working with academic partner Wayne State on a wellness program that allows health care workers and staff to talk with psychologists or therapists at any time. “What also has helped is we’ve been able to discharge so many patients in an efficient manner (more recently) and provided quality care to them that that has boosted morale
of our entire staff,” Chopra said. “We also have received tons and tons of donations from the community,” Chopra said. “The hospital has provided free meals for our trainees, our residents, our nurses, our staff so that they can always be fed, and they don’t have to hunt for food during these times when we are working long hours.”
Easing anxiety, stress While patient visitor restrictions prevent friends and families from seeing patients, most hospitals have exceptions for end-of-life patients or those about to give birth, doctors said. “We are constantly staying in touch with the families,” DMC’s Chopra said. “I have personally called families when patients are not doing well. I put them on the phone, and they talk with each other. I say prayers for them, with their families. These things are so important for closure for families.” Chopra, who grew up in India, was in medical school two hours away when her father died in her hometown. “I can understand what families go through. When my father passed away, I never got closure for the longest time. I still remember that,” Chopra said. Kalkanis said early on Henry Ford created a policy to allow communication with patients through Zoom, Skype or Facetime. “We have iPads in every unit. There’s instructions to nurses assigned to a patient. Here are the numbers and times and ways to connect with family members,” he said. “Each nurse on each shift tries to identify a window of time where they’re regularly calling family members for updates. That’s gone as well as could be expected.” UM’s Chopra said doctors and nurses try whenever possible to bring together patient and family member because it helps outcomes or provides closure. For example, a daughter of her hospitalized father wanted to sing a song to him. “We FaceTime’d her, put her on a speaker and let her sing the song. We do that as much as possible,” he said.
How bad will the surge be? Kalkanis said the biggest challenge for Henry Ford and other pressed hospitals is having enough nurses to staff ICUs and emergency rooms. “These are the areas of expertise, where we have significant numbers”of patients still coming in, Kalkanis said. Some of these workers, now more than 872 health care workers at Henry Ford, have tested positive for COVID-19. More than 1,500 (including 500 nurses) at Beaumont and 110 at University of Michigan also tested positive. “We were not overly shocked by those numbers. It’s what we expected and planned for,” said Kalkanis, adding Henry Ford provided as much personal protective equipment and tested as many employees as it could. Based on about 32,000 employees, Kalkanis said the number of positives is what would be expected in the community at about 2.5 percent. “We have the names of every single one of our employees: nurses, doctors, physician assistants, all,” Kalkanis said. “We’re active in communication with them to make sure that number one, people feel safe.” Contact: jgreene@crain.com; (313) 446-0325; @jaybgreene APRIL 13, 2020 | CRAIN’S DETROIT BUSINESS | 17
TRAINING
From Page 3
Consider the story of Tyques Banks. Twice imprisoned for drug convictions, Banks landed a union job with a building contractor straight out of Parnall Correctional Facility near Jackson last summer. The Detroit man is laid off now, sidelined by the coronavirus that is like sand in the world’s economic engine, but the apprentice carpenter is bullish on his future. “At first I thought it was bull----,” said Banks, who lives with his son and the boy’s mother. “They put my foot in the door. My life was locked and they actually cracked them doors (open) for me.” Employers, unions and prison officials give the state’s Vocational Village program high marks for creating opportunity for ex-offenders who historically struggle to find gainful employment when they get their freedom back. Perhaps more importantly, so do inmates past and present. Juan Ortiz spent five years looking through the wrong side of bars inside the federal penitentiary in Milan, getting out in 1992. Today he is a business rep for the carpenters union. “I spent years on the streets tearing down this city, and now I get chance to build Detroit back up,” said Ortiz, 56, who was convicted of laundering drug money. Ortiz estimates 20 to 25 parolees found work through the union, good paying jobs with benefits and health care. None have been re-arrested, a testament to the life-stabilizing power of a middle class living, Ortiz said. After prison, “They go and try, taking whatever (work) they can get,” he said. “But they can’t pay their bills, and they get frustrated and go back to what they know.” “We’re trying to change that,” Ortiz added.
Training grounds Parnall Correctional Facility is a minimum security prison off Interstate 94 and U.S. 27 near Jackson. CMS Energy’s headquarters is just down the road. Corn is king around here. So is the prison industry. Concertina razors coil across the 34-foot-high wall that lent the former Jackson State Prison the title of “world’s largest walled prison.” The state busted the monolith into smaller prisons beginning in the late 1980s. In the shadow of the wall, utility poles rise 45 feet in the yard outside the prison’s Vocational Village building. Crossbeams connect the poles. This is where inmates learn to climb. “The real pucker factor is when the trees get 60, 70 feet high,” said tutor Jeffrey Gunnells, 50, a utility line clearer before opiate addiction and an armed robbery in 2012. He is scheduled to be paroled soon. On a February day inside Parnall’s Vocational Village, before coronavirus shut down classes, men with chainsaws are dropping limbs from real trees, anchored 25-footers replenished from state land. There are computers for coding, power tools for government cars and polished steel, Rubik’s Cubetype puzzle-paperweights, gifted to visitors. Equipment is staged by skill set amid a mostly open floor plan. Fifteen to 20 inmates a group is standard. The state actually has two Vocational Villages. The first opened in 2016 at Handlon Correctional Facility in Ionia. Handlon can handle 165 students. Parnall has the capacity for 240 and a few dozen tutors. Both offer instruction 18 | CRAIN’S DETROIT BUSINESS | APRIL 13, 2020
Davione Samuels sorts equipment in the climbing tree training area, where inmates train to become tree trimmers or linemen after they are paroled in MDOC’s Vocational Village program at the Parnall facility in Jackson. | DALE G. YOUNG FOR CRAIN’S DETROIT BUSINESS
in skilled trades and have created a new pipeline of talent for employers. There are a dozen or so disciplines: carpentry, plumbing, automotive, CNC/robotics, trucking, welding, electrical, masonry/concrete and forklift certification. A partnership with Google.org and The Last Mile teaches computer and website coding. The newest skill provides inmates with chain saws. Those who prove adept are guaranteed a job with DTE Energy Co. The Line Clearance and Tree Trim Program is a partnership with DTE and the International Brotherhood of Electrical Workers. The carpentry program is affiliated with the Michigan Regional Council of Carpenters and Millwrights. The DTE Foundation gave the state a grant to pay for the tools and equipment for the tree-trimming program, including an indoor tree stand. A third Vocational Village was to be dedicated this spring at the women-only Huron Valley Correctional Facility near Ypsilanti, but that’s delayed due to social gathering precautions. The corrections budget for education is $38 million this year. The villages cost $1.5 million to $2 million annually, mostly for faculty, said Chris Gautz, spokesman for the state Department of Corrections. Startup costs for each village are much more.
Training is offered to applicants throughout the state system. They must be within 18 months of freedom. That’s to ensure their skills are fresh, aptitude and interests are tested. No one with a major misconduct need apply — or more than a few minor ones. Counselors evaluate local job markets; it’s important there be a demand for the skill close to their home. A white board in the Vocational Village “war room” tracks individuals’ progress. About 90 days from release, an email blast is sent to scores of employers. Full-time job counselors get on the phones. Want a prospect video? They’ll send it. Want to see him working in person? They’ll arrange it. Successful villagers take with them proof of their certifications, a driver’s license or state ID, and copies of vital documents, all in a packet. Inmates
“I THINK IT CREATES FOR A BETTER MICHIGAN. IT’S SAFER. I CAN’T SAY ANYTHING ELSE OTHER THAN INSTEAD OF THEM BEING A CRIMINAL IN THE NEIGHBORHOOD, THEY’RE A CITIZEN, AS YOUR NEIGHBOR.” Ready to work upon release — Melinda Braman, Parnall’s warden
In the past, prison career programs often amounted to a couple hours a day. Vocational villagers put in an honest day’s work, Monday through Friday, much more like the world beyond the razor wire. “They are completely segregated from the rest of the prison population so they don’t have to run into other prisoners,” Gautz said. “They are completely focused on their skills and what they need to do and all the follow-up that happens.” The state touts the village approach as the “first of its kind.” The claim is largely anecdotal and difficult to confirm. But Parnall’s warden Melinda Braman points to attention from corrections officials across the nation. Kentucky, Kansas and Washington have sent a delegations to check out the program, Braman said. “I think it creates for a better Michigan. It’s safer,” said Braman, whose career began as a guard. “I can’t say anything else other than instead of them being a criminal in the neighborhood, they’re a citizen, as your neighbor.”
who score well on the ACT WorkKeys test receive a National Career Readiness Certificate. Steady work at living wages hopefully sets them on a path away from one that led here. Society saves lockup costs. Companies get highly vetted workers with hard-to-find skills. Parole officers keep tabs on them. Inmates get a career. “They’re overwhelmed with going to actually get a skill using their mind and not wrecking their body,” said Brian Friedman, principal of Parnall’s Vocational Village.
From skepticism to buy-in Recidivism rates typically represent ex-cons who are re-arrested within three years. Statewide, the rate was 26.7 percent statewide last year, an alltime low, the department announced March 4. Fewer than 5 percent of the 700 vocational grads have re-offended, Gautz said, acknowledging it’s barely three years since the first villagers graduated.
DTE Energy so far has hired five workers from the tree trimming program. One has been re-arrested. “He got into kind of an innocent situation that was, I’ll say, just wrong place at the wrong time. He was actually one of the better performers,” said Terrell Lockhart, manager of local resource development for the Detroit-based utility. “Everybody was a bit sad and we have to remember that nobody is perfect, and we’re not going to get all of them.” Three hundred more would be enough. That’s how many more instate workers DTE wants to hire. Some 1,200 trimmers were needed to clear trees and branches from 4,100 miles of power lines last year, Lockhart said. Four hundred had to be contracted from elsewhere, Lockhart said. He’d like to reduce that to 100 out-of-staters. “Those that are homegrown, they end being the cream of the crop,” he continued. DTE has many more mature trees to clear than nearby states like Ohio and Indiana; the technical skills often don’t translate, Lockhart noted. The job is not for the faint-hearted. Falls, electrocution and being struck or crushed by objects are the construction industry’s “Fatal Four.” They accounted for nearly 600 U.S. deaths — or one in five workplace fatalities — in 2018, the most recent year available. “DTE has committed to hiring everyone who successfully completes the program,” Lockhart said. At first, hiring returning citizens straight out of prison was a hard sell. “A lot of skepticism,” Lockhart recalls. “We had to win them over and show them that we were going to stand next to them, and it definitely took a lot of standing with them.” “Once you see the hope on their faces, that genuineness, it’s hard not to walk away without sensing that,” Lockhart added. “It’s enough to brighten your day.” To build on the effort, the utility is working with a nonprofit to establish the Detroit Tree Trimming Academy, to open soon. The focus is on DTE’s service area primarily in the Motor City.
‘It’s behind us now’ As a child, Ichard Oden would scavenge doors from vacant homes in his Detroit neighborhood. “I always wanted to be construction,” said Oden, 41. “I’d hammer them together for a clubhouse.”
Today, Oden is a poster child. Wearing a hard hat, a wide smile and a T-shirt tested by his biceps, his image appears on the back of a glossy fourpage pamphlet promoting the carpenter union’s partnership. His path took 20 years and a terribly wrong turn. Oden was convicted with two others in the kidnap-murder of an acquaintance over stolen drugs. Lit cigarettes and hot quarters were used to torture the victim before he was shot, court records show. Detroit was dealing with a wave of juvenile crime. The man and woman are still serving mandatory life sentences for first-degree murder, according to prison records. Oden, convicted separately without testifying, was sentenced in September 1999 for second-degree murder. President Bill Clinton had just survived impeachment. Y2K was months away. The radio played “Livin’ La Vida Loca.” Oden was paroled on Feb. 28, 2019. Six days later he had a job. He works for Manic Construction, a framing contractor in Clinton Township. He’s especially proud of the apartments he helped frame near where Tiger Stadium once stood Today, Oden lives with his sister in Taylor. He can’t afford a home yet. As an apprentice, he makes $15 an hour, but figures to double that. He’s saving and wants to buy a house. But that will take time. Oden’s done enough of that. So he took a second job. After punching out at 4 p.m., he punched in an hour later at a seafood restaurant (now offering takeout only). Oden would serve until 11 p.m. and be at his construction job by 7:30 a.m. He’s laid off now, but expects to return. “They set up those programs to help you stay out,” Oden said. “Anybody that does not take advantage, they’re foolish.”
Laid off, but confident Banks said his life has taken a completely different turn for the better since he completed the Vocational Village program. In 2016, the 28-year-old Detroiter was sent to prison for three years. Cocaine and a gun were found during a traffic stop. “I didn’t even know it was in the car,” he starts, then stops. It’s a long story and anyway he’d been out less than two years on a cocaine dealing arrest. “I was working at a temp service and stuff like that, and I would work my a-- off at those jobs,” Banks said, but the work was never steady. “The only thing I could get back into is going back to what I know. “This time I had the opportunity to come (to prison) and change my life,” he said. The carpenter apprentice was released Aug. 13 and hired by construction contractor Pontiac Ceiling and Partition LLC. He has worked on a hotel in Birmingham and a music room at Michigan State University. He’s earning $17.99 an hour with benefits. “I bought a car within like 20 days of me working and making my own money,” he said. Banks is laid off now, sheltering in place like most of the state’s workforce. But that does not worry him. After the coronavirus outbreak subsidies, Banks has career goals — work hard, earn his journeyman’s card and become a crane operator. “They want me back,” he said. “They see the hard work this brother can do. I don’t see any problem in that area.”
THE CONVERSATION
Mary Lynn Foster on Red Cross, COVID-19 and making cakes
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AMERICAN RED CROSS MICHIGAN: Mary Lynn Foster came home to Michigan last July to lead the American Red Cross Michigan as regional CEO. A CPA by trade, she spent years with the firm now known as PricewaterhouseCoopers but was always an active volunteer. When her kids went away to college, she channeled her passion for giving back, entering the nonprofit sector. Foster, 58, grew up in Eastpointe and St. Clair Shores, before moving north to Petoskey when her dad left a career at General Motors and her parents bought a hotel. Working there gave her a real-life business education that’s proving as useful in the nonprofit sector as it was in public accounting. | BY SHERRI WELCH `You joined the Red Cross here in Michigan after it had gone through some consolidation, right? Over a year ago, the American Red Cross looked at where blood was being collected and where it made sense and didn’t make sense to continue that. We have competition. The American Red Cross supplies on average 40 percent of the nation’s blood supply. It’s really important that we have the network to supply that. But also we have to do it fiscally responsibly. We have to be able to maintain infrastructure and invest back into blood mobiles and everything it takes to continue to meet the demand for blood.
Has that abated?
` Who else collects blood nationally? Within our region and Michigan, Versiti (another nonprofit) is a competitor.
`Are you testing donated blood for COVID-19? No, the Red Cross is not testing your blood for the virus. The reason for that is there is not the ability to do that, even if we wanted to. We’re asking people to notify the Red Cross if they’re positive.
`So the Red Cross was looking strategically at where blood was being collected? There was an evaluation done. Blood continues to be collected in Michigan but not in the UP and not in the very northern part of the Lower Peninsula, north of Traverse City across the state. But the Red Cross is very much continuing to collect blood in Michigan. Michigan is one of highest blood-collecting states. `Why is that? There’s just a rich history of the Red Cross in Michigan, with the growth in need and the hospital systems here. Blood is transferred from here to a northern Ohio lab system. It’s processed there and moved to wherever the need is. So it’s the proximity to the labs, warehousing and distribution network here that allows Michigan to continue to collect. `The Red Cross was seeing blood shortages as the pandemic led to cancellation of blood drives everywhere.
It was really critical a few weeks ago. On March 23, across the country, 7,000 drives had been canceled, equating to 200,000 blood units. It was critical up until early April. We got the word out to the American public we are an essential organization, we’re safe and there’s no evidence transfusing blood can transfer the virus. Everyone just came out and really helped fill the immediate need for blood. But — and this is the big but — what about next week and the week after? The need for blood for is constant. A lot of elective surgeries aren’t happening, but there are other surgeries, cancer patients who need blood.
`The Red Cross is working with the U.S. Food and Drug Administration on a convalescent treatment of some sort for those with COVID-19? The Red Cross is partnering with FDA on this but is not the lead. Once you’ve had the virus and recovered from it, your blood can be tested to see if you have antibodies. If your blood indicates you have the antibodies from the virus, it’s possible, but very fluid and developing, there may be a treatment where those antibodies from your blood can be used as a treatment in the future. The Red Cross is working closely with the FDA to develop a process to identify and qualify individuals who have recovered from the virus and have the necessary antibodies to participate in this effort. `Is COVID-19 impacting the Red Cross in any other way?
Yes, on disaster services. Every night in Michigan somewhere we are responding to home fires. That’s very much an in-person service, and our workforce is 90 percent volunteers. We’ve had to revise how we’re responding. We’ve gone to a virtual response through our phones, computers, just how everyone else is doing it. Michigan is fortunate we don’t experience the huge hurricanes and other large events. But we typically deploy volunteers to assist. Our population of volunteers is weighted toward retirees. We have to be careful now. Safety comes first.
beautiful. But mine fell. So I thought I’ll cover it up with frosting. I have recipe for a stay-soft frosting that you cook on the stove. But when I took it off the stove, it was pure liquid. I had all the ingredients I needed for my mom’s buttercream frosting. I used it to fill in the crater in the cake, put sprinkles on it and we ate it all week. It took six to seven hours to make. I thought, “I’m not going to get this time back in my life.” It was fun but took a lot more time than I thought. Sunday afternoon I was exhausted. Mary Lynn Foster, regional CEO, American Red Cross Michigan
`What are you doing for fun or to catch a break amid it all right now? With my team, we definitely are using technology more through Microsoft Teams and Zoom so we can see each other. We had a call this morning — we all made cards and took selfies. One of my fundraisers this morning had a witch hat on. It just kind of makes you smile and laugh. All Red Crossers are working extraordinary hours. But sometimes we just have to give each other a few minutes to laugh and enjoy each other. In late March on a Sunday morning, I had this crazy urge to make something. I hadn’t made anything from scratch in decades. And of course I had to use my mom’s recipe. I got all the ingredients out and started putting it together. But I don’t know what happened — the cake came out with a big crater in the center. I remember my mom making it, and it was always
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Nonprofits exchange ideas on navigating new reality Metro Detroit nonprofit and fundraising leaders shared ways to shore up cash flow and operating budgets in the era of coronavirus-induced cancellations during a webinar hosted by Crain’s Detroit Business. Find a replay at crainsdetroit. com/nonprofitfundingwebinar. Panelists for the Nonprofit Funding Crisis webinar included: ` Brad Coulter, president and CEO of Matrix Human Services, Detroit’s largest Headstart provider ` Alissa Novoselick, executive director of Detroit arts education nonprofit Living Arts, which was Crain’s Best-Managed Nonprofit last year ` Steve Ragan, executive vice president of Hope Network and president of the Association of Fundraising Professionals, Greater Detroit Chapter
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` Portia Roberson, CEO of Detroit-based Focus: HOPE Living Arts lost $200,000, or a fifth of its annual budget, in event and earned revenue with the cancellation of its only major fundraiser and the closures of schools, Headstart and community centers, Novoselick said. “We are incurring administrative costs even without the in-person programs, and further, cash projections into the next year ... are even more frightening,” she said. To recoup $200,000 in lost revenue, Novoselick said Living Arts launched a crowdfunding campaign seeded with the proceeds from tickets and sponsorships made in support of its now-canceled annual youth performance and networking event. The event has already exceeded a quarter of its fundraising goal.
Innovative fundraisers can help attract new revenue, Ragan said, pointing to events held on online video platforms like Zoom. And they may be something nonprofits need to consider for the foreseeable future. Large events could come back yet this year, but “we’re operating on the assumption that we will probably never put 10 people at an eight-top table again, (and) we will probably always space tables out a little more than in the past.” Direct outreach to donors is also a powerful way to shore up nonprofit budgets, he said, noting there could be a silver lining in looking at alternative fundraising. Events are generally one of the most expensive ways to raise money. “There are benefits with events. ... but if people throw that energy into
making one-on-one calls ... and to finding creative ways to tell their story ... I think they could find that they could raise just as much( or) more money and with less cost.” The unrestricted dollars events bring in are incredibly important for nonprofits like Matrix, Coulter said. “As anyone who runs a nonprofit ... painfully knows, your funding streams are extremely restrictive. Even though you may have a large top line, you really don’t have that much money available to move between programs. “So what happens is some programs, especially now, are cashrich, while others that rely on program billing or per-unit of service or just general funding like our community center to support it, are struggling.”
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APRIL 13, 2020 | CRAIN’S DETROIT BUSINESS | 19
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