Crain's Detroit Business, Feb. 22, 2021, issue by Crain's Detroit Business

SMALL BUSINESS SPOTLIGHT: Young entrepreneurs are finding ways to blossom. PAGE 3

THE CONVERSATION Ferndale chamber Executive Director Joy Wells talks post-pandemic growth, partnership. PAGE 22

CRAINSDETROIT.COM I FEBRUARY 22, 2021

FOCUS | HIGHER EDUCATION

IVORY TOWERS Crain’s special report examines how higher education is failing Black Americans in the Midwest

BY AMY MORONA

oughly 17,500 students enrolled at the University of Chicago this past fall. Eight hundred and twenty-eight of that group, just 4.7 percent of its total population, are Black, including Claire Shackleford. The 21-year-old detailed an experience where required reading lists lean heavily into works by white male authors. There are fewer professors of color, so students instead befriend Black cafeteria workers or custodians for support. It’s common, she said, to be the only Black student in a classroom. “The burden of being a student of color at a predominantly white institution is that you’re often expected to speak on behalf of your race,” she said. In three Midwestern cities, there are broad disparities in who is going where in higher education — and who is going anywhere at all. Black Americans in Chicago, Cleveland and Detroit, as well as the nation, remain underrepresented at our best colleges and overrepresented at some of our worst. Take Cleveland, for example, where nearly half of city residents are Black. Case Western Reserve University, the city’s most selective college, reported only 6 percent of its population was made up of Black students in 2018, a number that’s barely budged since 2000. The school declined to be interviewed for this piece. See FAILING on Page 20

ILLUSTRATION BY ANDREA LEVY FOR CRAIN’S

CRAIN’S DATA | BIGGEST DEALS OF 2020

COVID-19 didn’t slow consolidation in 2020; pace likely to accelerate in 2021 BY DUSTIN WALSH

Much of 2020 was about change and loss. Most businesses, at least temporarily, lost business as the pandemic drove customer spending behavior in new ways. Many more had to change — either the way their business operated or who operated it. Last year, much of the largest merger and acquisition activity wasn’t driv-

en by opportunity, but by necessity. Whether pushed by the pandemic or technological disruption, industry consolidation was the trend. But the pandemic didn’t dent deal sizes, as valuations remained high. In fact, the 20 largest deals of 2020 (See Page 9-10 for the full list) clocked in at $24.81 billion, only $50 million less than the $24.86 billion in 2019. See BIGGEST DEALS on Page 8

NEWSPAPER

The five biggest deals of 2020

For a list of more of the biggest deals of the year, see Pages 9-10.  1) Huntington Bancshares, Columbus, Ohio, acquiring TCF Financial Corp., Detroit. $6 billion  2) BorgWarner Inc., Auburn Hills, acquiring Delphi Technologies PLC, London, $3.94 billion  3) Simon Property Group Inc., Indianapolis, acquiring 80 percent ownership of Taubman Centers Inc., Bloomfield Hills, $3 billion  4) Sun Communities, Farmington Hills, acquiring Safe Harbor Marinas, Dallas, $2.13 billion  5) BMC Software Inc., Houston acquiring Compuware Corp., Detroit from Thoma Bravo L.P., Detroit, $2 billion

MENTAL HEALTH CARE

STATE OF CONFUSION

Finding a way to fix a mental health system that has too many layers to navigate PAGES 13-18 ILLUSTRATION BY FERGS FOR CRAIN’S

NEED TO KNOW

CAREER HONORS

THE WEEK IN REVIEW, WITH AN EYE ON WHAT’S NEXT  RESTAURANT GROUP SEEKS COVID BENCHMARKS THE NEWS: The Michigan Restaurant and Lodging Association on Wednesday released a plan it believes provides a clear, metric-driven road map to eventually restore normal operations across the hospitality industry, particularly in restaurants, hotels and banquet halls. The proposal is a two-tiered approach that calls for creating a reintegration schedule that ties restaurant and event space occupancy to the COVID-19 daily positive test rate. WHY IT MATTERS: Businesses affected by these restrictions have been pleading with state officials for more specific guidance than they have received so far.

 ONLINE GAMBLING GETS OFF TO BIG START THE NEWS: The launch of legal online casino gambling and sports betting gave a boost to state and city of Detroit coffers. In the period of Jan. 2231, the state brought in $29.4 million in gross receipts from internet casino gambling and another $13.3 million from internet sports betting, the Michigan Gaming Control Board said. MGCB Executive Director Richard Kalm told the Senate Regulatory Reform Committee that while $115 million was wagered in internet

got a $103,199-a-year legal job in 2019 at the mental health agency after Brooks suggested he apply for the job. WHY IT MATTERS: In a memo Wednesday, Brooks admitted he failed to submit a conflict of interest form to DWIHN’s human resources “reporting a familial relationship ... and other matters that were not properly disclosed.”

sports betting over about a week and a half, the revenue generated did not nearly equate to that amount. WHY IT MATTERS: Tax collections tied to gambling have dried up during the pandemic for the state of Michigan and city of Detroit, and online betting offers a chance to get some of that revenue back.

 NEPOTISM REPORT LEADS TO CEO’S OUSTER THE NEWS: The Detroit Wayne Integrated Health Network’s board voted 8-2 Wednesday not to renew the contract of CEO Willie Brooks after he failed to disclose that a lawyer hired in the mental health agency’s legal department is his son-in-law. His abrupt departure comes one day after Channel 7 (WXYZ) reported that Brooks’ son-in-law, Sean Riopelle,

 NESTLE SELLS BOTTLEDWATER BUSINESS THE NEWS: Nestle SA agreed to sell bottled-water brands in the U.S. and Canada to private equity firm One Rock Capital Partners in a $4.3 billion deal that puts the future of the ailing business in the hands of the man who helped turn around Pabst Blue Ribbon and Hostess Twinkies. Dean Metropoulos is joining up in One Rock’s purchase of the Nestle brands, which include Poland Spring, Pure Life and Deer Park. The billionaire investor is known for reviving worn-out products like Bumble Bee Tuna and Chef Boyardee. WHY IT MATTERS: The water business has been controversial in Michigan, where Nestle pumps water for its Ice Mountain brand from the ground near Evart, where lawsuits have been filed to try to limit how much water the company can take.

Crain’s Henderson honored by journalism hall of fame  Longtime Crain’s reporter Tom Henderson is among seven inductees selected for the Michigan Journalism Hall of Fame for 2021. Henderson joins journalists from an array of media disciplines in the honor, which is run by Michigan State University. During his long, varied and continuing career, Henderson pioneered the coverage of Michigan’s nascent venture capital industry. His journalism biography also includes covering the Detroit Red Wings for the Detroit Free Press and covering Michigan’s running scene for The Detroit News and Michigan Runner magazine. He has also authored five true crime books for St. Martin’s Press. Henderson continues writing regularly for Crain’s. Other inductees this year include: Radio and TV reporter Al Allen; sportswriter Joanne Gerstner; automotive writer Jean Jennings; Edward Lapham, longtime editor at Crain’s sister publication Automotive News; auto and labor writer and editor Marjorie Sorge; and Creem magazine editor and music columnist and Detroit News music writer Susan Whitall. The inductees will be honored at a ceremony in the fall.

Longtime Crain’s reporter Tom Henderson is among seven inductees selected for the Michigan Journalism Hall of Fame for 2021.

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SMALL BUSINESS SPOTLIGHT

Young entrepreneurs finding ways to turn passion into profit

Cultural district Wi-Fi to set stage for outdoor programs

LEARNING TO RUN A BUSINESS ON THE FLY

BY SHERRI WELCH

The free outdoor Wi-Fi planned for the cultural district in Detroit’s Midtown area is expected to set the stage for more outdoor programming, beginning this year. Midtown Detroit Inc., the nonprofit leading planning efforts for the district, is working with Wayne State U n i v e r s i t y ’s Computing and Information Technology Department and Ann Arbor-based design firm Rootoftwo LLC to extend the university’s Wi-Fi system to public Borucki Wi-Fi for the Cultural Center, with the first installations expected this spring. When complete, the system will not only provide an amenity for nearby residents and an expanded, seamless service area for WSU students to access the university’s network but also an opportunity for the 12 cultural institutions in the district to bring programming outdoors. “We know visitor numbers will likely be very low this year because of ... limited capacity, so we’re trying to explore doing programming outside,” Annmarie Borucki, director of arts and culture for Midtown Detroit, said. A $500,000 grant from the John S. and James L. Knight Foundation is funding the Wi-Fi expansion, with additional support from the Ralph C. Wilson Jr. Foundation. The Knight grant is also funding development of digital strategies and outdoor screens, whether inflatable or on building walls, and passthrough grants to the cultural institutions to help spur use of digital tools such as video projection and interactive events using widely available, existing apps.

Owner Ja’Nye Hampton at Detroit Flower Co. in Detroit. Hampton started the company in 2018. NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

BY JASON DAVIS | Ja’Nye Hampton fashions herself a typical 22-year-old, but her schedule isn’t like most people her

age. Hampton, the owner of Detroit Flower Co., gets up at 5:30 every morning and works until 8 p.m. at her new shop in northwest Detroit. When she gets back to her apartment, she spends her “free time” replying to messages and order requests via Instagram, along with checking her website for new orders. “I (work) until I fall asleep,” said Hampton, a graduate of Cass Technical High School in Detroit. “I take Sundays off. This (business) is my baby.” Running a small business can be challenging, especially so for very young entrepreneurs who enter the arena with little to no college education or experience in areas such as bookkeeping and marketing. But the allure of pursuing a passion as profession is enough for an increasing number to bet on themselves.

Blooms in new space Hampton started Detroit Flower Co. in 2018, right out of high school. She specializes in formal bouquets and unique arrangements with spray-painted flowers. Before going full-bore with her own company, Hampton worked many part-time jobs, including at a Thrifty Florist location during high school,where she learned all about the floral business. At one point, Hampton was one of

the youngest managers in the Southfield-based chain. Before getting her new space 15643 W. McNichols Road near Greenfield, Hampton kept all of her inventory at her small apartment. Then a customer whose family buys, sells and leases properties helped her find a location for her growing business. Hampton took over the new space in December and hopes to open it to the public in March. See YOUNG on Page 20

Hear Jason Davis interview 22-year-old owner of Detroit Flower Co. Ja’Nye Hampton in the debut episode of Crain’s Small Business Spotlight podcast. Go to crainsdetroit.com/podcasts or find it on Apple Podcasts, iTunes or wherever you listen to podcasts.

LESSONS LEARNED Be ready to work: No one who owns a small business starts with a full staff of employees. The owner, at first, usually wears lots of hats. That also leads to a lot of long work days. Seek help: Organizations such as Techtown Detroit, Bamboo Detroit and Detroit Young Professionals offer resources and networking opportunities to young entrepreneurs. For more tips, see Page 20

See CENTER on Page 19

INTERNATIONAL BUSINESS

Michigan leaders seek to further business ties with Israel BY NICK MANES

Interest by Israeli businesses, particularly technology-focused ones, in establishing a presence in Southeast Michigan continues to percolate. In the early weeks and months last year leading up to the coronavirus outbreak that brought much economic activity to a halt for a time, Israeli companies were clamoring to get a foothold in the region, particularly within the expanding autonomous and connected vehicle sector. Much of that work continues to be on track, according to industry executives. GuardKnox, an Israeli cybersecu-

“THE WHOLE GOAL HERE IS THAT THOSE CONNECTIONS … CREATE RELATIONSHIPS, WHICH DRIVES COLLABORATION, WHICH DRIVES INVESTMENT AND EMPLOYMENT.” —Matt Elliott, Michigan Israel Business Accelerator board chair and Michigan market president and regional executive for Bank of America

rity provider focused on the automotive and mobility sector, launched in the U.S. with an office in Livonia early last year just before the pandemic took hold. GuardKnox’s U.S. Managing Director Joe Romeo, an automotive industry veteran, said work has continued

on building up a team in Southeast Michigan. “Things are going well and probably better than you would expect,” Romeo told Crain’s. “We had a commitment early on in the pandemic (from the company’s Israeli CEO) that we’re still full-speed ahead ... and allowed

me to continue hiring in the U.S.” Romeo’s company joined others in establishing Southeast Michigan outposts in early 2020, as Crain’s reported at the time. That’s all good news for leaders with the Michigan Israel Business Accelerator, a Southfield-based nonprofit organization focused on strengthening business ties between the two states. MIBA’s work focuses on mobility, defense, cybersecurity, health and life sciences sectors, as well as food and agricultural technology. The nonprofit has routinely taken part in trade delegation trips to Israel that it hopes further strengthen busi-

ness ties. The pandemic brought travel to a halt, said Matt Elliott, MIBA’s board chair and the Michigan market president and regional executive for Bank of America. Elliott took over board chair duties on Jan. 1 of this year from Mark Davidoff, CEO of family office the Fisher Group, and who is still an active board member of the group. Despite the inability to travel, the group still helped to foster more than 100 “connections” last year, defined as a Michigan company exploring opportunities in Israel, or vice versa, Elliott said. See ISRAEL on Page 18

FEBRUARY 22, 2021 | CRAIN’S DETROIT BUSINESS | 3

REAL ESTATE INSIDER

People are at the heart of what we do. At its heart, a business is about people. A group of people coming together to create something bigger than themselves. To create a solution or a product or an experience in the service of other people. At Huntington, it’s our belief that running a business is about more than making money, it’s about making people’s lives better. So let’s roll up our sleeves and get to work, together. The Onassis Coney Island at Michigan Avenue and Trumbull in Corktown shuttered recently, surprising the restaurant’s landlord. | KIRK PINHO/CRAIN’S DETROIT BUSINESS

At The Mike Cox Law Firm we recognize the complexity of Byzantine tax laws and are prepared to assist you and your business in all aspects of state and local tax planning and litigation. - Jackie Cook Former Chair of the Taxation Sectionof the State Bar of Michigan

4 | CRAIN’S DETROIT BUSINESS | FEBRUARY 22, 2021

Onassis Coney Island’s closure took even the building owner by surprise The circumstances surrounding the closure of Onassis Coney Island at a key intersection in Detroit’s Corktown neighborhood remain a mystery. Kirk Even the PINHO restaurant’s landlord had no idea it shuttered when I talked to him Tuesday morning. Of course, restaurants in general have been battered by the COVID-19 pandemic and government shutdowns of indoor dining as part of broader efforts to slow the spread of the virus that has claimed more than 15,000 lives and infected 575,000plus in Michigan. The neighborhood has also seen a wave of residential and hotel development plans, along with, of course, Ford Motor Co.’s underway redevelopment of the Michigan Central Station building as part of a $740 million autonomous and electric vehicle campus. As Bridge Detroit’s Louis Aguilar first noted on Twitter on Feb. 12, we don’t know whether one of those factors or something else entirely was the main impetus for the closure. But regardless, it has certainly sparked speculation. In quick succession on Feb. 13, my cell phone got the same unverified rumor twice within the span of literally five minutes regarding what will next occupy the space. I sent direct messages (DMs, as the kids say) to the Onassis Instagram and Facebook accounts seeking additional information but have not heard back. “Our time serving you on the corner of Michigan and Trumbull has come to an end,” a note on the door says. “Corktown has been good to us and will always hold a special place in our hearts. We have been in the

The Roberts Riverwalk Hotel (foreground) at 1000 River Place Drive. | COSTAR GROUP INC.

restaurant business for a long time, no location will ever compare to our customers here. We will miss you and can’t thank you enough for all the love, support and appreciation we have received over the last 10 years. We will keep you posted on our social media pages (IG/Facebook) on where our next venture will be, if lucky not too far.” The 2,000-square-foot building is owned by Joe Mifsud, but he told me Tuesday morning that he was not aware of the closure. He abruptly hung up the phone, saying he had to get down to Detroit.

Redevelopment of Gabriel Richard Building complete The conversion of the Gabriel Richard Building downtown into apartments is complete. The project by developer Joe Barbat finished in November at 305 Michigan Ave., a 10-story building, which is being master leased by Sonder USA Inc. and rented to tenants in a mixture of studios, one- and two-bedroom apartments. The redevelopment cost was not disclosed, but was financed by CIBC and Invest Detroit. The Gabriel Richard Building sold for $3.2 million to Barbat in February 2015. At the time, he planned a $6.5 million renovation into apartments.

The building is being rebranded as Gabriel Houze.

Roberts Riverwalk Hotel up for auction next month The Roberts Riverwalk Hotel on the Detroit riverfront hits the auction block next month. The auction through Bethesda, Md.-based special servicer CWCapital’s RealINSIGHT Marketplace team runs March 22-24. Larry Emmons, senior managing director in the Farmington Hills office of Newmark (formerly Newmark Knight Frank), said the property is not being sold under duress (such as being in foreclosure from its lender, for example). The reserve price for the 108-room hotel at 1000 River Place Drive was not disclosed, although the starting bid is $4.5 million, according to the auction’s website. “I think we’ve set the reserve at a very competitive price,” Emmons said. The property hit the market last year for $26 million but didn’t sell. It had been under contract to a joint venture between real estate developers Christos Moisides and Dominic J. Moceri, but that deal collapsed. Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB

EDUCATION

Private colleges in Michigan try new strategy: working together Albion launches program with WMU; Adrian expands programming outside liberal arts BY KURT NAGL

With talk of mergers and acquisitions swirling around the sector, Michigan’s small independent colleges are forging more partnerships to weather the storm of a shrinking market made worse by the pandemic. The impact of COVID-19 and the downward trend of enrollment predating the pandemic has hurt higher education across the state and the country. But for independent schools, which rely on tuition as their main source of income and lack the safety net of state aid, the situation is particularly dire. “For some of our schools, 10 more students is the difference between being in the red and the black,” Robert LeFevre, president of Michigan Independent Colleges & Universities, told Crain’s in a recent interview. “You have a shrinking market. We do have less and less high school graduates every year.” The competition for those students has become so fierce that it has compelled some institutions “to do one thing higher education has never done. And that is, work together,” said Jeffrey Docking, president of Adrian College. Docking, who took the helm of the 160-year-old liberal arts college in 2005, decided a couple of years ago to upend the business model. In 2019, Adrian launched Rize, an initiative allowing students to take online classes from partnering institutions around the country, expanding the availability of different programs not offered on campus. While not without critics, the program has grown exponentially and become a major reason for stable enrollment, Docking said. “What I truly believe is that the business model for higher education in the U.S. is hopelessly broken,” he said. “Small, private colleges are first in line to start closing. These schools have one choice in my opinion: innovate or die.” The mentality is much the same at Albion College, a liberal arts school around the same age and size as Adrian, targeting the same shrinking pool of prospective students. Albion is rolling out a new program that guarantees eligible high school graduates admittance into the school and into Western Michigan University’s Homer Stryker M.D. School of Medicine after their undergraduate studies, Albion announced this week. Albion President Mat Johnson said it’s the start of a new way of doing business that emphasizes collaboration over mere competition. The school has signed similar agreements with Michigan universities for nursing and engineering programs and is in talks with other medical schools. Johnson withheld specifics on those deals. “We need to be able to convey to students and parents that we have well-worn pathways to success,” Johnson told Crain’s. “We hope that by the end of the year, we will have many of these partnerships.” Adrian and Albion have the advantage of being relatively close to large metro areas in the southern part of the state and have strengthened recruiting efforts in Chicago and other Midwest cities.

attendance is $62,970, administrators are facing similar financial issues. Fall enrollment was up about 40 students from last year to 1,492. While that equated to increased revenue, the college has also had to dole out more money for tuition discounts and recruiting. To ease financial losses, such as room and board refunds, the college tapped a $7.5 million gift — one of its largest ever — made this summer. “The financial damage has been significant,” Albion’s Johnson said. “We have been fortunate to have a few generous donors.”

Controversial changes Albion College is developing a new business plan focused on partnering with other colleges on programs for fields in high demand. | ALBION

Challenges in attracting, retaining students Attracting students has been one of the biggest struggles for Finlandia University, the only private college in the Upper Peninsula. Enrollment at the Lutheran university in Hancock was 405 students this fall, down 18 from the year before and more than 130 from a peak in 2015, according to data provided by the school. Finlandia recently announced a new articulation agreement with Northern Michigan University that provides a “clear pathway for students interested in pursuing a Master’s of Social Work degree,” according to a news release. “All we’ve ever wanted to do is try to figure out a way to be helpful, and we’ll continue to have discussions with them about possible partnerships and so forth,” NMU President Fritz Erickson told Crain’s. “You know, schools in the U.P. try to help each other out whenever possible.” Finlandia President Philip Johnson declined to be interviewed but said in an emailed statement, “Collaborations with NMU and other campuses have been very helpful on the programmatic side as we work through this pandemic and attempt to provide additional resources and opportunities to our students.” Partnerships among colleges in Michigan have stopped short of M&As, LaFevre said, but those deals are picking up across the industry. In the past year, there’s been at least half a dozen closures or consolidations — Wesley College in Delaware, MacMurray College and Robert Morris University in Illinois, Concordia University’s campus in Portland and Urbana University in Ohio. The closure of Marygrove College in Detroit in 2019 was the most recent in Michigan. The last significant merger locally happened just down the block from Marygrove 30 years ago when the University of Detroit merged with Mercy College. “Mergers are definitely on the table for schools that are struggling,” Docking said.

Price barrier Gov. Gretchen Whitmer has prioritized building a pathway to college education for Michigan residents. She has proposed a large funding increase for free community college programs and an increase in aid to universities. “There is a price tag that stands in the way,” Whitmer told Crain’s last week.

“We’re going to eliminate that barrier.” For many private colleges, the price barrier is increasingly difficult to navigate. At Adrian, the annual cost of attendance has ballooned to $49,529. At the same time, its discount rate has crept up to 60 percent, Docking said. So even though 2020 fall enrollment grew by nearly 50 students to 1,865, revenue remained flat at $50 million. In response to financial strain from the pandemic, the college made budget cuts, laid off or furloughed 75 employees, and raised more than $1 million in scholarships, Docking said. The college has also made several draws against its endowment in the past few years, exceeding its spending rule by $2.5 million. It aims to pay back the money to the fund by the end of the year. At Albion, where the annual cost of

Adrian’s addition of a new e-sports management program this spring, among other new courses, didn’t sit well with some students and faculty, especially those who received pink slips when the school moved to cut the history, theater, philosophy and religion programs last year. The decision, made quietly, was reversed after outcry from students and the faculty, many of whom have demanded Docking’s removal as president. Docking sent a letter to the campus community in September saying that the layoffs had been rescinded. “… We will look for other ways to manage the budget in the year ahead,” he said in the letter. Lowering the cost of college and guaranteeing well-paying jobs after graduation is crucial for sustainability, Docking told Crain’s. That’s been the goal of Rize, which began with 19 schools pooling together a few pro-

Docking

Johnson

grams. It has grown to more than 90 member schools and 20 majors ranging from supply chain management to computer science. Other Michigan-based member schools are Olivet College and Rochester University. Adrian students who enroll in a major through the program still take 90 percent or more of their classes on campus, pay Adrian tuition rates and receive their degree from Adrian without transfer credits. The upside for students is more availability of in-demand majors while still getting the on-campus experience. Just a few students took part in the program when it first launched. This semester, there are 124 students taking a class through Rize. The benefit for Adrian is being able to expand its offerings without typical upfront expenses, which normally include hundreds of thousands of dollars in new faculty and facilities. The administrative cost to be part of the consortium is $350 per class, Docking said. “We’ve incubated this idea that we can bring down the cost … spin the dial the opposite way,” he said. Contact: knagl@crain.com; (313) 446-0337; @kurt_nagl

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COMMENTARY

How to flip the script on economic development BY NED STAEBLER

DANIELSAAD FOR CRAIN’S DETROIT BUSINESS

EDITORIAL

It’s time for state to give restaurants guidance

he Whitmer administration’s aboutface on allowing high school sports to begin playing again added another month of uncertainty to Michigan’s restaurant and hospitality industry. How’s that, you ask? The order issued by the Michigan Department of Health and Human Services quietly extended the current 25 percent capacity limit for restaurants and bars and the 10 p.m. closure curfew until March 29 — without any explanation why from Gov. Gretchen Whitmer or MDHHS leaders. The capacity limits were supposed to expire Feb. 21. This is yet another example of the Whitmer administration going it alone on managing the pandemic without any justification for its actions using real-time data. How would the governor’s public health experts know on Feb. 4 what the trajectory of the virus will be like on Feb. 21, much less more than seven weeks into the future? COVID-19 has been in steady decline in Michigan since early January. The daily case count is at its lowest point since early October. The positivity rate dipped below 3 percent this past week, the lowest level in more than four months. And the mass inoculations needed to end this pandemic are finally starting to pick up, with 5.4 percent of the population now having received a second dose of a COVID vaccine. Whitmer’s mid-November “pause” of dine-in service that lasted 10 weeks this winter worked. It saved lives. But for all the sacrifice that was made during the second COVID shutdown, Whitmer’s approach now with restaurants, casi-

nos and other places of public accommodation still lacks any real benchmarks for loosening restrictions on these businesses. The Democratic governor has steadfastly refused to set those benchmarks — and now the Republican-controlled Legislature is blocking appropriation of some $5 billion in federal aid that’s needed to reopen schools, prevent an eviction crisis and build up a better infrastructure for COVID testing, contact tracing and getting badly needed vaccine shots in arms. As we approach the one-year anniversary of Michigan’s first detected cases of COVID-19, it’s high time to end this stalemate in Lansing. GOP legislative leaders need to get in the room with the governor and stop sitting on a badly needed economic stimulus. And Whitmer needs to create some path of certainty with data benchmarks rooted in science. The Michigan Restaurant and Lodging Association has proposed raising occupancy levels as the COVID positivity rate declines. There’s no disputing the governor that the pause did what it set out to do. Lives were saved. The state’s hospitals averted a disaster. Now it’s time to save livelihoods and establish clear benchmarks for re-engaging all sectors of the economy.

MORE ON WJR ` Crain’s Executive Editor Kelley Root 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.

e’ve been doing economic development all wrong. It’s not hard to see — the results are right in front of our eyes. Over the past four decades, under administrations of both major political parties, Michigan has Ned Staebler is gone from being a relavice president tively prosperous state to for economic an objectively poor one. development at Even before the panWayne State demic, more than 43 perUniversity and cent of Michigan housepresident and holds couldn’t pay for CEO of basic necessities. TechTown. A host of community, business, government, and economic development leaders have come together in an effort called Rising Income for All. Our call is to reduce this horrible statistic and make rising household income for all Michiganders the new primary goal of state economic development policy. Shifting focus to the economic well-being of Michigan residents instead of GDP growth is the first step. Next comes the important task of crafting the best set of policies to achieve this goal. While there is no magic formula, it’s clear from the experience of successful places around the country and the world that we must invest in our existing residents, places and entrepreneurs. We must develop our own talent and local businesses and create places that will retain that human capital and attract more of it. In short, we need to do the opposite of what we do now — making top-down investments in large corporations in the hope that they will bring jobs and, ultimately, prosperity. For the most part, Michigan’s economic development strategy is based on a sound concept: provide targeted incentives to businesses and define milestones and metrics that trigger the full value of the incentives. But what if the targets of those incentives weren’t companies? What if we directly removed barriers and helped people achieve goals that already align with the path to prosperity for Michigan? In other words, what if we treated people better than businesses? For example, in successful places, more people have higher levels of education, and people with higher levels of education have higher incomes. However, in Michigan, cost is a huge barrier for those seeking college degrees or other credentials. So, taking a page out of our corporate-focused playbook, why don’t we provide tax credits for people who achieve certain educational milestones, say earning a bachelor’s degree, and then stay in the state? Of course, back-end incentives won’t remove one of the prime barriers to education for lower-income people: the fact that they need money to pay for school now. So, couple this tax credit with one of the existing scholar-

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 | FEBRUARY 22, 2021

ships like Michigan Reconnect or Futures for Frontliners. For businesses making improvements to properties that are blighted or functionally obsolete, we’ve created an incentive called tax increment financing, or TIF. TIF works like this: we look at the taxes a company is paying before making the improvement and we call that the “baseline.” Once they increase the tax owed, say by constructing a new building, the increase or “increment” is used to offset the cost of the investment or pay for environmental remediation. Flipping the script, Jordan Twardy, an economic developer from Ferndale, suggests using a similar mechanism for people who are repairing or fixing up their properties in cities and inner ring suburbs, allowing them to capture the taxable value of improvements they make to their homes. This would help revitalize urban areas, increase the wealth of those residents, and improve their quality and standard of living. In the past year, we’ve all been made acutely aware of the importance of traditional small businesses to our commercial corridors and main streets. Yet we have directed very little specific economic support for these businesses. This has always been shortsighted. We must ensure that all over the state, every small business and each would-be entrepreneur has access to the financial support and technical assistance they need to start, stabilize, WE MUST and scale their busiDEVELOP OUR ness. The Michigan Eco- OWN TALENT nomic Development Corp. has divided the AND LOCAL state up into 21 small- BUSINESSES AND er areas each serviced by what it calls a CREATE PLACES “SmartZone.” Each THAT WILL SmartZone provides all manner of techni- RETAIN THAT cal assistance and fi- HUMAN CAPITAL nancial support to businesses in its re- AND ATTRACT spective geography. MORE OF IT. Business owners who work with a SmartZone have access to a statewide pool of capital called the Business Accelerator Fund. If they need to build a prototype or hire a lawyer, they can access the fund for up to $50,000. Sounds great, but here’s the catch: This support is only available to technology-based businesses. The state should create a similar structure to SmartZones, but for traditional businesses, and complement this structure with a fund to help defray startup expenses if the business works with these technical assistance providers. These are just a few of the ideas that economic developers and business leaders across Michigan have shared with me when I’ve asked: What if we treated people better than businesses? There are dozens more. You’ve probably thought of one while reading this. It’s time to flip the script. It’s time to unlock Michigan’s potential and invest in our people.

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

MDHHS director: Investments to improve mental health access BY ELIZABETH HERTEL

Michigan has made great strides in recent years in improving access to health care — whether it is physical health or mental health. A recent MichiElizabeth Hertel gan Health Enis director of the dowment Fund Michigan study estimates Department of that only 60 perHealth and Human Services. cent of Michiganders who have behavioral health needs receive necessary services. As a state, we can do better. Gov. Gretchen Whitmer’s fiscal year 2022 budget recommendations make a powerful statement about our state’s commitment to the mental health needs of our residents. The events of the past year have demonstrated the importance of access to behavioral health services. COVID-19 has taken a toll on many people’s mental well-being. We may be more isolated. We may worry about the future more. Connecting with our support networks has become more challenging. All of these changes have affected our mental health. I would like to share initiatives that the Michigan Department of Health and Human Services has implemented to help the state’s residents cope with mental health issues and detail three investments in the governor’s budget that will help us even more. A key to improving access to both physical and mental health services has been the Healthy Michigan Plan. It has expanded Medicaid coverage to more than 850,000 people who otherwise would have been unable to afford health insurance coverage. Every month, Michigan’s community mental health system delivers an average of 1.2 million encounters — defined as any face-to-face or telehealth-delivered mental health services. During the pandemic, MDHHS has seen great demand for mental health resources — and responded by adding services and resources that can be found on the Stay Well website, Michigan.gov/StayWell. There you can find phone and text lines to connect anonymously with mental health assistance provided by people who have had similar experiences with mental health needs. The StayWell website has been viewed more than 135,000 times since May 2020, and more than 25,000 people have reached out to the phone and text support lines featured on the site. The governor’s budget proposals include three important new investments in mental health. The first is $26.5 million — $21.5 million in federal Medicaid dollars and $5 million in state general fund money — to create a Certified Community Behavioral Health Clinic system, or CCBHC. A CCBHC is a new provider type in Medicaid, designated to provide comprehensive care for adults with mental health or substance use disorders and children with serious emotional disturbance. This breakthrough approach builds off U.S. Sen. Debbie Stabenow’s work to expand Certified Community Behavioral Health Clinics and secure grant funding for Michigan to help us

achieve critical goals of expanding ac- od to monitor the demonstration’s efcess, lifting quality, and integrating fectiveness and assess approaches to expand CCHBC successes statewide. mental and physical health care. MDHHS is in the planning phase After its expiration, CCBHC providers will maintain acfor Michigan’s cess to Medicaid CCBHC demonTHE EVENTS OF THE PAST and Healthy stration. It will include 14 provider YEAR HAVE DEMONSTRATED Michigan Plan reimbursement for organizations, alservices provided lowing approxi- THE IMPORTANCE OF to those promately 100,000 ACCESS TO BEHAVIORAL grams’ enrollees. Michigan resiThe second dents access to HEALTH SERVICES. budget investenhanced behavioral health services. Once funding is ment focuses on mental health serapproved, Michigan can launch the vices for our children. It provides $91 demonstration in the designated sites. million — $30 million from the state MDHHS can use this two-year peri- general fund — to make program

changes aimed at increasing consistency in access to behavioral health services for Medicaid enrollees and those served through the child welfare system. This investment reflects MDHHS’s ongoing commitment that will best serve Medicaid eligible children in Michigan. Michigan is committed to our children and helping them grow up mentally healthy. The third budget recommendation provides $360 million — including $121 million in state general fund dollars — to make permanent the recent temporary $2 per hour increase in pay for direct care workers. The budget investment makes a strong statement

about the importance of stabilizing this work force. Direct care workers are essential in assisting both adults and children with behavioral health needs to successfully live in Michigan communities. These staff provide daily support, encouragement and training to ensure that Michigan’s vulnerable residents have the opportunity to live in their communities. Combined, these three budget proposals will help Michigan take better care of its residents’ mental health needs. We look forward to partnering with the Legislature on our shared goal of improving access to behavioral health services across the state.

Enough is enough.

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A $3 billion merger between mall giants Simon Property Group and Taubman Centers Inc., whose chairman Robert Taubman is shown here, combines high-end malls under one portfolio. | ANDREW HARRER/BLOOMBERG

BIGGEST DEALS

From Page 1

The largest deals of 2020 had little to do with the pandemic. Ohio-based Huntington Bancshares Inc.’s acquisition of Detroit-based TCF Financial Corp. is the result of a long-running trend since the Great Recession more than a decade ago. Banks have been under pressure to consolidate as regulatory changes from the Dodd– Frank Wall Street Reform and Consumer Protection Act of 2010 put more barriers to risk, and thus earnings, in front of banks. And as consumers continue to prefer online banking services, it’s been critical for regional banks to invest in technology to remain relevant, leading to many “mergers of equals” like Huntington and TCF. The all-stock deal that will create a combined company with approximately $168 billion in assets and would be in the top 20 for largest banks in the country in terms of total assets, according to a recent list by the U.S. Federal Reserve Bank. The COVID-19 pandemic and federal regulations requiring banks to pause foreclosures and other investment recovery measures will likely only expedite the trend when the pandemic subsides. BorgWarner Inc.’s deal to acquire Delphi Technologies, which values Delphi at $3.9 billion, in an all-stock deal is also a deal to build scale against change. Electric vehicles accounted for a mere 1.8 percent of U.S. autos sold in 2019, yet the business is restructuring the entire automotive sector and forcing vulnerable suppliers to weld together. Experts say this is the start of a long and possibly painful consolidation throughout the automotive industry. That will come at a time when some are predicting sales of internal-combustion engines — and perhaps autos overall — may have peaked for all time. Both companies’ engine and transmission businesses are seen by analysts as entering a period of decline, but are hoping a coupling will create enough volume to sustain. The acquisition of Delphi allowed BorgWarner to outperform Wall Street estimates in the last quarter of 2020. Revenue for its air management division were up 26.7 percent in the fourth quarter to $1.94 billion with most of that increase coming

Webcast examines post-pandemic M&A outlook The pandemic reshaped mergers and acquisitions in 2020, but it didn’t halt them. Crain’s will take a look back at the deals of 2020 and what to expect in 2021 in M&A trends in a webcast at 3:30 p.m. March 10. Senior reporter Dustin Walsh will host a series of conversations with guests including:

 Mina Sooch, CEO and co-founder, Ocuphire Pharma Inc.

 Greg Lehmkuhl, president and CEO, Lineage Logistics

 Rajesh U. Kothari, CFA managing director, Cascade Partners LLC

 Laura Marcero, managing director, Huron Consulting Group

The free event will feature live Q-and-A with the panelists. You can register at crainsdetroit.com/events.

from a $312 million boost from Delphi business. Without Delphi, that unit’s revenue would have been up just 2.8 percent on the quarter. Same for BorgWarner’s drivetrain segment, which reported sales of $1.45 billion in the quarter, up more than 38 percent from the same quarter last year with Delphi business accounting for $255 million of the roughly $400 million increase in sales. “The consolidation (in the auto sector) is driven by a need for size and scale and the shift to electrification,” said Marc Holzer, partner with Deloitte’s Risk & Financial Advisory’s

“THE CONSOLIDATION (IN THE AUTO SECTOR) IS DRIVEN BY A NEED FOR SIZE AND SCALE AND THE SHIFT TO ELECTRIFICATION. AUTOMAKERS ARE PUTTING LINES IN THE SAND OR DATES ON THE CALENDAR IN PIVOTING AWAY FROM AN INTERNAL COMBUSTION PORTFOLIO TO AN ELECTRIC PORTFOLIO AND THAT’S DRIVING A LOT OF DEALS FOR SUPPLIERS EXPOSED TO INTERNAL COMBUSTION ENGINES.” — Marc Holzer, partner with Deloitte’s Risk & Financial Advisory’s Mergers and Acquisitions practice in San Francisco

Mergers and Acquisitions practice in San Francisco. “Automakers are putting lines in the sand or dates on the calendar in pivoting away from an internal combustion portfolio to an electric portfolio and that’s driving a lot of deals for suppliers exposed to internal combustion engines.” Simon Property’s $3 billion deal to acquire a majority stake in Bloomfield Hills-based Taubman Centers is much of the same. The mall operators combined to accrue more highend malls, which have fared better in recent years, under one portfolio. With more pressure to consolidate on the horizon, unprecedented funds on the sidelines from private equity and the growing optimism over the pandemic thanks to vaccine distribution, 2021 is likely to see ever-expanding deals, said Carrie Leahy, partner and chair of Detroit-based law firm Bodman PLC. Globally, uncommitted private equity funds grew 9 percent in 2020 to $865 billion, a figure that has more than doubled in the past decade, according to an EY report. “There is a lot of capital available in the market,” Leahy said. “Buyers are definitely on the sidelines waiting to see what happens with the pandemic and government assistance, but they are eager to deploy capital as soon as they can.” Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

CRAIN'S LIST | MERGERS & ACQUISITIONS IN 2020 Ranked by value of transaction VALUE OF TRANSACTION ($000,000)

ACQUIRER NAME

TARGET

ACQUIRER ADVISERS

TARGET/SELLER ADVISERS

DATE

DESCRIPTION

HUNTINGTON BANCSHARES INC.

TCF FINANCIAL CORP.

Goldman Sachs & Co. LLC (financial advisor); Wachtell, Lipton, Rosen & Katz (legal advisor)

Keefe, Bruyette & Woods, a Stifel Compnay (financial advisor); Simpson Thacher & Bartlett LLP (legal advisors)

Announced Dec. 2020

Under the deal, the companies will combine in an all-stock merger with a total market value of $22 billion to create a top 10 U.S. regional bank with dual headquarters in Detroit and Columbus, Ohio. Deal is expected to close in Q2 2021.

$6,000.0

BORGWARNER INC.

DELPHI TECHNOLOGIES PLC

Simpson Thacher & Bartlett LLP (Legal Advisor); BofA Securities Inc. (Financial Advisor); Rockefeller Financial LLC (Financial Advisor)

Kirkland & Ellis LLP (Legal Advisor); Innisfree M&A Inc. (Information Agent); Goldman Sachs International (Fairness Opinion Provider); Goldman Sachs International (Financial Advisor)

Closed Jan. 2020

Sold by Invesco Ltd.; BlackRock Inc.; The Vanguard Group Inc.; Ninety One UK Limited.

$3,948.2

SIMON PROPERTY GROUP INC

TAUBMAN CENTERS INC.

Paul, Weiss, Rifkind, Wharton & Garrison LLP; Latham & Watkins LLP

Honigman LLP; Wachtell, Lipton, Rosen & Katz

Announced Nov. 2020

The deal provides Simon Property Group Inc. an 80 percent ownership stake in Taubman Centers.

$3,000.0

SUN COMMUNITIES OPERATING LIMITED PARTNERSHIP

SAFE HARBOR MARINAS LLC

Jaffe Raitt Heuer & Weiss, P.C. (Legal Advisor); Citigroup Global Markets Inc. (Financial Advisor)

Citizens Capital Markets Inc. (Financial Advisor); Sidley Austin LLP (Legal Advisor); Duane Morris LLP (Legal Advisor); Moelis & Company LLC (Financial Advisor)

Closed Sept. 2020

The total deal consists of the assumption of debt in the estimated amount of $808 million and $130 million in Sun shares.

$2,133.0

5 6

BMC SOFTWARE INC.

COMPUWARE

Macquarie Capital; Jefferies LLC; Simpson Thacher & Bartlett LLP

Credit Suisse; Kirkland & Ellis LLP

Closed June 2020

Sold by Thoma Bravo LP.

$2,000.0 1

COUPA SOFTWARE INC.

LLAMASOFT INC.

Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP (Legal Advisor)

Kirkland & Ellis LLP (Legal Advisor)

Closed Nov. 2020

Sold by West Street Capital Partners; TPG Capital L.P.

$1,438.5

ACPRODUCTS INC.

MASCO CABINETRY Ann Arbor

Goldman Sachs & Co.; Barclays PLC; Ropes & Gray LLP; Baker Botts LLP; Sidley Austin LLP

Davis Polk & Wardwell LLP; Citigroup Global Markets Inc.

Closed Feb. 2020

Sold by Masco Corp.

$1,000.0

LINEAGE LOGISTICS LLC

EMERGENT COLD LLC

Latham & Watkins LLP

Debevoise & Plimpton LLP

Closed June 2020

The deal marks Lineage's entry into the Australia, New Zealand and Sri Lanka markets, further expanding the reach of the world's largest temperature-controlled logistics company.

$900.0 2

BLACKROCK INC.; ROYAL VOPAK N.V.

CERTAIN GULF COAST MARINE AND TERMINAL OPERATIONS AND ASSETS OF DOW INC.

Hunton Andrews Kurth LLP (Legal Advisor); JPMorgan Chase & Co. (NYSE:JPM) (Financial Advisor)

The Goldman Sachs Group Inc. (NYSE:GS) (Financial Advisor); Mayer Brown LLP (Legal Advisor)

Closed Sept. 2020

Sold by Dow Inc. The name of the joint venture is Vopak Industrial Infrastructure Americas LLC.

$620.0

Feb. 2020

Special purpose acquisition company B. Riley acquired Alta as part of a going-public transaction.

$541.0

Columbus, Ohio

Auburn Hills

Detroit

London, United Kingdom

Dallas, Texas

Farmington Hills

Houston

San Mateo, Calif.

Addison, Texas

Novi

New York, N.Y.; Rotterdam, ZuidHolland

Detroit

Ann Arbor

Dallas, Texas

United States

B. RILEY PRINCIPAL MERGER CORP.

11 12

SHIONOGI & CO. LTD.

TETRA THERAPEUTICS INC.

Nomura Holdings Inc. (TSE:8604) (Financial Advisor)

Closed May 2020

Under the terms of the deal, Tetra is now a wholly owned subsidiary of Shionogi.

$500.0

HEMLOCK SEMICONDUCTOR LLC

TRICHLOROSILANE BUSINESS OF DUPONT DE NEMOURS INC.

Kirkland & Ellis LLP (Legal Advisor); Mayer Brown LLP (Legal Advisor)

Skadden, Arps, Slate, Meagher & Flom LLP (Legal Advisor)

Closed Sept. 2020

DuPont received pre-tax cash proceeds of $550 million at closing and expects to receive additional pre-tax cash consideration of $175 million over the next 36 months associated with the settlement of an existing supply agreement dispute with Hemlock.

$475.0

DAIRY FARMERS OF AMERICA INC.

ASSETS OF DEAN FOODS CO.

Houlihan Lokey Inc. (NYSE:HLI) (Financial Advisor); Latham & Watkins LLP (Legal Advisor); Bryan Cave Leighton Paisner LLP (Legal Advisor); Porter Hedges LLP (Legal Advisor)

Davis Polk & Wardwell LLP (Legal Advisor); Alvarez & Marsal Holdings LLC (Financial Advisor); Evercore Group L.L.C. (Financial Advisor); Norton Rose Fulbright LLP (Legal Advisor)

Closed Feb. 2020

The deal includes 44 of the Dean Foods Company's fluid and frozen facilities and the real estate, inventory and equipment.

$433.0

ACRISURE LLC Caledonia

ARTIFICIAL INTELLIGENCE INSURANCE BUSINESS OF TULCO LLC

BDO USA, LLP (Due Diligence Provider); Sica Fletcher LLC (Financial Advisor)

Skadden, Arps, Slate, Meagher & Flom LLP (Legal Advisor)

Closed July 2020

Tulco is now a minority shareholder in Acrisure.

$400.0

GFL ENVIRONMENTAL INC.

AMERICAN WASTE INC.

KPMG Corporate Finance LLC (Financial Advisor)

Closed Jan. 2020

The deal consists of approximately $360 million in cash and $20 million of GFL Environmental nonvoting shares.

$380.0

YANFENG AUTOMOTIVE TRIM SYSTEMS CO. LTD.

YANFENG INTERNATIONAL AUTOMOTIVE TECHNOLOGY CO. LTD.

Sullivan & Cromwell LLP (Legal Advisor); Sullivan & Cromwell LLP (Legal Advisor)

Closed Jan. 2020

Sold by Adient plc. Yanfeng acquired the remaining 30 percent stake in Yanfeng Global Automotive Interior Systems Co. Ltd. It didn't already own, thus terminating the joint venture.

$369.0

WATCO COS. LLC

RAIL INFRASTRUCTURE ASSETS AND RELATED EQUIPMENT AT SIX MAJOR NORTH AMERICAN SITES

Mayer Brown LLP (Legal Advisor); Goldman Sachs & Co. LLC (Financial Advisor); Thompson Hine LLP (Legal Advisor)

Closed July 2020

Sold by Dow Inc.

$310.0

Osaka, Japan

Hemlock

Kansas City, Kan.

Ontario, Canada

Shanghai, China

Pittsburg, Kan.

Grand Rapids

United States

United States Kalkaska

Shanghai, China

United States

CORNING INC.

HEMLOCK SEMICONDUCTOR LLC Hemlock

Kirkland & Ellis LLP (Legal Advisor); JPMorgan Chase & Co. (NYSE:JPM) (Financial Advisor)

Closed Sept. 2020

Sold by DuPont de Nemours Inc.

$250.0

19 20

UFP INDUSTRIES INC.

PALLETONE INC.

Varnum LLP (Legal Advisor)

Haynes and Boone, LLP (Legal Advisor);

Closed Dec. 2020

Sold by Equus Total Return Inc. PalletOne Inc. reported sales of of $525 million in 2019.

$232.0

LINEAGE LOGISTICS LLC

HENNINGSEN COLD STORAGE CO.

Credit Suisse; Latham & Watkins LLP

BofA Securities

Closed July 2020

The acquisition adds to Lineage’s U.S. facility network and bolsters its presence in the Pacific Northwest, with the addition of 14 facilities across Oregon, Washington, Idaho, Pennsylvania, North Dakota and Oklahoma.

$225.0 1

ORAFOL EUROPE GMBH

KAY AUTOMOTIVE GRAPHICS

KPMG LLP

Honigman LLP; Doeren Mayhew Capital Advisors LLC

Closed Sept. 2020

The deal included Kay's sister companies Kay Graficas Automotrices in Mexico and Kay Premium Marking Films in the U.S. and United Kingdom.

$200.0

AGREE REALTY CORP.

FOUR WALMART SUPERCENTERS

Closed March 2020

The deal total is approximately 29 percent cash deal and 87 percent coming from the annualized base rents from tenants.

$192.4

UNKNOWN 3

INDUSTRIAL PORTFOLIO LARGELY IN OHIO

Effective Feb. 2020

Sold by Whirlpool Corp. The portfolio includes 3.1 million square feet of industrial real estate consisting of four distribution centers, one manufacturing facility in the U.S. and two office sites in Italy.

$178.9

Corning, N.Y.

Grand Rapids Novi

Germany

Bloomfield Hills

Bartow, Fla.

Hillsboro, Ore.

Lake Orion

United States

Source: S&P Global Market Intelligence (spglobal.com/marketintelligence), Bloomberg Terminal and Crain's research | In some cases, more than one estimated value of a transaction exists. In those cases, Crain's has chosen

the value it believes to be most accurate. The list does not include all 2020 transactions, only those valued at $10 million or more. It is not a complete listing but the most comprehensive available. NOTES: 1. Crain's estimate. 2. Bloomberg estimate. 3. An unknown buyer acquired Industrial Portfolio Largely in Ohio from Whirlpool Corp.

Want the full Excel version of this list — and every list? Become a Data Member: CrainsDetroit.com/data FEBRUARY 22, 2021 | CRAIN’S DETROIT BUSINESS | 9

CRAIN'S LIST | MERGERS & ACQUISITIONS IN 2020 Ranked by value of transaction ACQUIRER NAME

TARGET

ACQUIRER ADVISERS

TARGET/SELLER ADVISERS

DATE

DESCRIPTION

VALUE OF TRANSACTION ($000,000)

SAGE AUTOMOTIVE INTERIORS INC.

AUTOMOTIVE FABRICS MANUFACTURING AND LAMINATION BUSINESS OF ADIENT PLC

Morrison & Foerster LLP (Legal Advisor); Rothschild & Co SCA (ENXTPA:ROTH) (Financial Advisor)

Closed March 2020

Sold by Adient plc.

$175.0

MIRAE ASSET DAEWOO CO., LTD.; STRATEGIC PROPERTIES OF NORTH AMERICA; INTEGRATED CAPITAL MANAGEMENT LLC

CITYFRONT PLACE IN CHICAGO

Closed April 2020

Sold by DWS Group GmbH & Co. KGaA.

$154.0

AVON PROTECTION SYSTEMS INC.

TEAM WENDY LLC

White & Case LLP (Legal Advisor); PricewaterhouseCoopers LLP (Accountant); William Blair International Limited (Financial Advisor); Evercore Partners International LLP (Financial Advisor); White & Case LLP (Legal Advisor); Link Asset Services (Holdings) Limited (Transfer Agent/Registrar)

Closed Sept. 2020

Avon Protection Systems Inc. entered into an agreement to acquire membership interests of Team Wendy LLC from Moore family.

$130.0

OSHKOSH CORP.

PRATT & MILLER ENGINEERING AND FABRICATION INC.

Announced Dec. 2020

Pratt & Miller will maintain its name, team members, facilities and branding elements. The transaction is expected to close in the first calendar quarter of 2021.

$115.0

RANIR LLC

ORAL CARE ASSETS OF HIGH RIDGE BRANDS CO.

Morgan, Lewis & Bockius LLP (Legal Advisor); Sawaya Partners LLC (Financial Advisor)

Debevoise & Plimpton LLP (Legal Advisor); Young Conaway Stargatt & Taylor, LLP (Legal Advisor); PJT Partners Inc. (NYSE:PJT) (Financial Advisor)

Closed April 2020

Sold by Dr. Fresh LLC; High Ridge Brands Co.; Freshcorp Inc.; Children Oral Care LLC.

$113.0

FRAM CAPITAL GESTO DE ATIVOS SA; SAO JOSE CONSTRUCOES E COMERCIO LIMITADA

FORMER MOTOR VEHICLES ASSEMBLING PLANT OF FORD MOTOR COMPANY

Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga Advogados (Legal Advisor); Banco Santander (Brasil) S.A. (BOVESPA:SANB4) (Financial Advisor); Lefosse Advogados (Legal Advisor); Stocche, Forbes, Filizzola, Clapis, Passaro, Meyer E Refinetti Sociedade De Advogados (Due Diligence Provider)

Tozzini, Freire, Teixeira e Silva Advogados Ltda (Legal Advisor)

Closed June 2020

Sold by Ford Motor Co.

$103.0

TRIMAS CORP.

AFFABA & FERRARI SRL

Mediobanca Banca di Credito Finanziario S.p.A. (BIT:MB) (Financial Advisor); Alantra (Financial Advisor);

Closed Oct. 2020

$98.0

TRIMAS CORP.

RSA ENGINEERED PRODUCTS LLC

Houlihan Lokey Inc. (NYSE:HLI) (Financial Advisor); Much Shelist, P.C. (Legal Advisor);

Closed Jan. 2020

Sold by Cornerstone Capital Holdings LLC; Merit Capital Partners. RSA Engineered Products LLC is now part of TriMas' Aerospace segment. RSA Engineered Products reported revenue of $32 million in 2019.

$84.3

AGREE REALTY CORP.

FIVE PROPERTIES INCLUDING WEGMANS, WALMART AND HOME DEPOT

Closed Oct. 2020

The acquired properties include a Wegmans in Chapel Hill, N.C., a Walmart and Home Depot in Pittsfield, Mass., and a Home Depot in Paterson, N.J.

$83.4

24 25

Greenville, SC

Ireland

United States

Bloomfield Hills; Seoul, South Korea; Lakewood, N.J.

Cadillac

Oshkosh, Wis.

Grand Rapids

Sao Paulo, Brazil

Bloomfield Hills

Cleveland, Ohio

New Hudson

United States

Brazil

Italy

Simi Valley, Calif.

United States

33 34

APPLUS SERVICES, S.A.

RELIABLE ANALYSIS INC.

Angle Advisors LLC (Financial Advisor)

Closed Sept. 2020

$78.7

ATLAS COPCO NORTH AMERICA LLC

PERCEPTRON INC.

BNP Paribas SA (ENXTPA:BNP) (Financial Advisor); Pillsbury Winthrop Shaw Pittman LLP (Legal Advisor)

Dykema Gossett PLLC (Legal Advisor); XMS Capital Partners LLC (Fairness Opinion Provider); XMS Capital Partners LLC (Financial Advisor); Okapi Partners LLC (Information Agent);

Closed Sept. 2020

Sold by Harbert Management Corp.; Harbert Fund Advisors Inc.

$77.4

INDUSTRIAL OPPORTUNITY PARTNERS LLC

POLYVISION CORP. Johns Creek, Ga.

BDO LLP (Due Diligence Provider); Winston & Strawn LLP (Legal Advisor); Cowen Group Inc. (Financial Advisor)

Closed Feb. 2020

Sold by Steelcase Inc.

$74.0

36 37

STRIDE INC.

MEDCERTS LLC

Announced Nov. 2020

MedCerts' revenue for the last 12 months ending Sept. 30, 2020 was approximately $19 million.

$70.0

LEVEL ONE BANCORP INC.

ANN ARBOR BANCORP INC. Ann Arbor

Barack Ferrazzano Kirschbaum & Nagelberg LLP - legal counsel; Performance Trust Capital Partners, LLC - financial advisor

Sandler O'Neill + Partners LP financial advisor; Varnum LLP - legal counsel

Complete Jan. 2020

The size of the combined company is approximately $1.8 billion in assets, $1.4 billion in loans and $1.5 billion in deposits.

$67.8

MICHIGAN ELECTRIC TRANSMISSION COMPANY LLC

MICHIGAN TRANSMISSION ASSETS OF CONSUMERS ENERGY COMPANY

Announced Aug. 2020

Sold by Consumers Energy Co.

$59.1

COMPUWARE CORP.

INNOVATION DATA PROCESSING INC.

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

Tarter, Krinsky & Drogin, LLP

Completed Jan. 2020

$59.1

SUN COMMUNITIES INC. Southfield

FOREST SPRINGS MH COMMUNITY, CALIFORNIA

Closed Sept. 2020

$56.5

AYR STRATEGIES INC.

CANNTECH PA LLC

Dorsey & Whitney LLP (Legal Advisor)

McCarter & English, L.L.P. (Legal Advisor)

Closed Aug. 2020

As part of the deal, Ayr Strategies agreed to pay $25.2 million in cash, $15 million in Class B nonvoting exchangeable shares and $15.2 million in seller notes.

$55.4

REV GROUP, INC.

SPARTAN MOTORS EMERGENCY RESPONSE (ER) SEGMENT

Fredrikson & Byron; American Industrial Partners (AIP)

Varnum; Donnelly Penman & Partners, Baird

Closed Feb. 2020

Sold by The Shyft Group.

$55.0

EOTECH LLC Troy

EOTECH DIVISION OF L3 TECHNOLOGIES, INC.

David MacDonald, Warner Norcross + Judd LLP

David Reilly (in house counsel)

Completed July 2020

Sold by L3 Technologies Inc.

$50.0

43 43

EBERHART CAPITAL LLC

M. J. VAN DAMME TRUCKING INC.

Closed Aug. 2020

$50.0

DE BUYER LLC

EUROPEAN SUBSIDIARIES AND ASSETS OF DURA AUTOMOTIVE

Orrick, Herrington & Sutcliffe LLP (Legal Advisor)

Kirkland & Ellis LLP (Legal Advisor)

Announced May 2020

Sold by DURA Automotive Systems LLC; Dura Operating LLC; Dura Automotive Systems Cable Operations LLC; Dura G.P.; Dura Fremont L.L.C.; Dura Mexico Holdings LLC; NAMP LLC.

$50.0

Madrid, Spain

Parsippany, N.J.

Evanston, Ill.

Herndon, Va.

Farmington Hills

Novi

Detroit

New York, N.Y.

Brookfield, Wis.

Scottsdale, Ariz. New York, N.Y.

Madison Heights Plymouth

Livonia

United States

Little Falls, N.J.

United States

Grand Rapids

Charlotte

Ann Arbor Gwinn

United Kingdom

10 | CRAIN’S DETROIT BUSINESS | FEBRUARY 22, 2021

OBITUARY

CRAIN’S AWARDS

Longtime Oakland County economic development exec Ken Rogers dies

Nominate a notable leader in Diversity, Equity and Inclusion

BY DUSTIN WALSH

Ken Rogers, the longtime executive director of Troy-based industry organization Automation Alley and former deputy Oakland County executive, died at the age of 81 on Tuesday night. The cause of his death was not immediately known. Rogers was appointed to create and lead Automation Alley by then-Oakland County Executive L. Brooks Patterson in 1999 as a way to bridge the county’s growing technology sector with traditional automotive skills. Rogers ran the organization as part of Oakland County’s economic development department until Automation Alley officially separated itself from the county in 2014 to become a regional player in the space. Rogers continued to lead the organization as its executive director until 2016 when he retired and was replaced by then-COO Tom Kelly. Under Rogers, Automation Alley expanded from 42 member companies to more than 1,000 from an eight-county region in Southeast Michigan. In a statement, Kelly said: “We are deeply saddened to learn of the passing of Ken Rogers, who

served as executive director of Automation Alley for 17 years. ... Ken proved to be one of Michigan’s most influential leaders. ... Ken was a charismatic and energetic Rogers leader whose business accomplishments were only outshined by how genuinely he cared for his staff and our members.” Rogers joined Patterson at Oakland County as a deputy director in 1993 and served as the director of community and economic development. He also co-founded Oakland County’s Economic Development Corp. In 2010, Rogers was appointed to serve on the Industry Trade Advisory Committee on Information and Communications Technologies, Services and Electronic Commerce for the U.S. Department of Commerce. He was nominated by Sen. Debbie Stabenow. His term expired in 2014. He also served as a board member of Michigan’s Strategic Economic Investment Commercialization Board; the Michigan Manufacturing Technology Center; Chrysler Tech-

nology Advisory Committee; and the Detroit Regional Chamber. “I am deeply saddened by the death of Ken Rogers,” Oakland County Executive David Coulter said in a statement. “He faithfully served Oakland County residents for 22 years as deputy county executive. I got to know him best when I was a county commissioner and he was leading Automation Alley. Ken’s legacy will be his unwavering commitment to ensuring our region remained competitive for technology jobs, including expanding Automation Alley’s presence outside Oakland County. I send my thoughts and prayers to the Rogers family and friends.” Prior to joining the county, Rogers was the president of the Oakland County Chamber of Commerce and served as a director for the North Oakland County Board of Realtors. He was named chairman of Clarkston State Bank in 2007 and served in the role until its merger with Waterford Bancorp in 2019. Rogers earned a bachelor’s in public administration and an honorary doctorate in public service from Central Michigan University. Contact: dwalsh@crain.com; (313) 446-6042; @dustinpwalsh

Nominations are now open for Notable Executives in Diversity, Equity and Inclusion — but not for very long. We are looking for business leaders who have championed effective diversity, equity and inclusion strategies and initiatives within their organization. The best candidates will be able to point to specific, measurable outcomes that demonstrate how their leadership has improved diversity and created

a more inclusive workplace culture. The deadline to nominate a candidate is March 3. After being nominated, candidates will have until March 10 to complete a separate application. Winners will be featured in a May 17 special section in Crain’s. For more information or to start a nomination, visit crainsdetroit. com/nominate. Questions? Please contact Special Projects Editor Amy Bragg: abragg@crain.com.

Time running out to be part of Cool Places to Work The deadline is approaching to register your company to participate in Crain’s Cool Places to Work. The deadline is March 5. Whether your people are fully remote, back in the office, or essential workers on the front lines, a great experience at work — one that makes people feel engaged, motivated and valued — may be more important than ever. Every year Crain’s recognizes these workplaces in our Cool Places to Work awards, a list of the 100 best places to work in Michigan. Participating companies provide detailed information on their bene-

fits and policies, and their employees complete a comprehensive survey about workplace culture, company leadership and other aspects of their experience at work. Results are analyzed and ranked to determine our list of winners. All participating companies receive results of the survey to help inform and improve the employee experience. Any company with 15 or more Michigan-based employees is eligible to participate. This year’s Cool Places to Work will be featured in the Aug. 23 edition of Crain’s. For more information or to register, go to coolplacestoworkmi.com. SPONSORED CONTENT

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Matthew Heinz, Partner and Co-Practice Leader, Transaction Liability at Lockton Companies.

in mergers and acquisitions. R&W insurance has earned a seat at the table in all M&A transactions, acting as the main recourse for breaches of representations in deals ranging from $5 million to over $30 billion in enterprise value, spanning small minority investments to large public acquisitions. The market has paid out hundreds of millions of dollars in claims just over the last three years. Buyers can now lean on the insurance market rather than sellers to address indemnity needs, creating obvious advantages in an increasingly competitive M&A environment, and sellers can utilize insurance capital to achieve cleaner exits with limited indemnity and escrow obligations.

Tax insurance not only provides comfort around uncertain tax positions in M&A transactions, but also on a stand-alone basis at the corporate tax management level or in the context of tax equity investments in renewable energy projects. Litigation insurance has emerged as a viable hedge against the appeal of a successful judgment in a client’s favor, or to simply protect against an adverse judgment in pending litigation. The combination of these insurance alternatives has added efficiency, certainty and creativity to the M&A marketplace in a manner undreamt of by M&A practitioners 20 years ago. Our transaction liability team at Lockton, staffed by former M&A lawyers and insurance industry leaders with decades of experience navigating these solutions, stands ready to assist clients in maximizing M&A potential at every phase. Together with our industry-leading insurance and health and benefits diligence experts and best-in-class property and casualty broking teams, no firm is better positioned to assist clients large and small in optimizing M&A results before, during and after the deal process. FEBRUARY 22, 2021 | CRAIN’S DETROIT BUSINESS | 11

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12 | CRAIN’S DETROIT BUSINESS | FEBRUARY 22, 2021

QLine aims for reboot, will cut ties with streetcar management firm The operators of the QLine are plotting a pandemic comeback to get the Woodward Avenue streetcar rolling again by late summer. M-1 Rail, the not-for-profit owner of QLine, has canceled its operations contract with Transdev Services Inc., the Lombard, Ill.-based transportation management firm that has operated the streetcar since it launched to great fanfare in 2017. The streetcar should be back up and running by late spring after M-1 Rail hires and trains drivers and mechanics and goes through testing of the track and cars before resuming service to the public by late summer, spokesman Dan Lijana told Crain’s. “We brought the services in-house because the level of service that the outside provider was providing wasn’t in line with our service expectation,” Lijana said last week. Transdev’s original five-year $15.5 million contract dating back to 2016 was set to expire June 30 of this year; M-1 Rail incurred no cost to cancel the contract, Lijana said. “We’re looking at it as a fresh start,” Lijana said. The QLine’s fresh start also includes a new day-to-day leader at M-1 Rail’s Penske Tech Center, the streetcar’s operations facility along Woodward Avenue in New Center. Lisa Nuszkowski, founder of Detroit’s bike-share nonprofit MoGo, joined M-1 Rail full time as the organization’s new president on Jan. 1 after coming onboard part time last July, Lijana said. Last week, Nuszkowski announced publicly she was leaving MoGo, but didn’t say where she was going. The QLine halted service March 29, 2020, during the height of the first wave of COVID-19 infections in Michigan. It has not operated since, idling a 12-stop, 3.3-mile mass transit route that runs from Congress Street downtown to Grand Boulevard in New Center. Nuszkowski’s first big challenge will

center on hiring a general manager to run the technical end of the business managing drivers, mechanics and technicians that Transdev previously supplied Nuszkowski under its contract, M-1 Rail CEO Matt Cullen said. Transdev had “constant staffing problems” that affected service, Lijana said. “It’s just never worked out the way that we expected,” Cullen told Crain’s. “They just didn’t operate the way it needed to be operated. ... And it required us to be much, much more active in the day-to-day activities.” Some M-1 Rail employees returned to work last year as the organization made plans to cut ties with Transdev. Drivers and mechanics who worked for Transdev will be recruited to work for M-1 Rail, Lijana said. Nuszkowski brings a “big depth” in public-private partnerships from her ground-up launch of MoGo and an operational background that M-1 Rail needs to reintroduce the QLine to downtown Detroit workers and visitors after the pandemic ends, Cullen said. “We really wanted to have a second opportunity for a first impression,” Cullen said. “We really want to make sure when we relaunch that it’s operating the way it should be. And (Nuszkowski’s) passion for transit and the customer service I think will be important to achieve that.” “We want to demonstrate value as we relaunch,” Cullen added. Cullen remains the volunteer, unpaid CEO of M-1 Rail. But Cullen has never been day-to-day chief executive, in part because of the several hats he has worn in Rocket Companies founder Dan Gilbert’s business empire, which Cullen exited last summer after a stint as CEO of Bedrock LLC. Cullen has since become chairman and principal of Jack Entertainment,

the Cleveland-based casino business Gilbert previously owned. Cullen and his business partners bought Gilbert out of the last two Ohio casinos in December. Gilbert and Cullen were among a group of business and foundation leaders in town who were instrumental in getting the $140 million QLine constructed with a mixture of corporate and philanthropic donations as well as taxpayer grants. Gilbert’s Quicken Loans bought the naming rights to the streetcar. The QLine had just over 1 million riders in 2019 or about 3,000 rider trips per day, Lijana said. Beyond revenues from fares, the QLine’s operations have been subsidized by a mixture of private donations and taxpayer support. In September, the Michigan Legislature approved a $15 million earmarked appropriation for M-1 Rail’s operations spread over three years to help restart operations. In the 2019 fiscal year, the last full year the QLine operated before the pandemic, M-1 Rail’s total operating budget was $9.47 million. Transdev was paid $3.1 million annually to manage and operate the streetcar, though its contract did not cover all of the operating costs M-1 Rail incurred, Lijana said. Since its inception, the long-term financial viability of the QLine has always been a question mark, especially after the streetcar’s first few years were plagued with operational problems. The most common service delay stems from vehicles parked on Woodward Avenue blocking the tracks — an inherent problem for a fixed-rail form of mass transit sharing lanes with passenger vehicles and buses. Lijana said M-1 Rail’s leaders are actively looking for solutions “to ease the path of the QLine along the route.” “We feel much more in control of the outcomes than we did with the vendor,” Lijana told Crain’s. Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood

MENTAL HEALTH CARE

STATE OF CONFUSION

Michigan’s mental health system has many layers for those in need to navigate

BY CHAD LIVENGOOD

ichigan’s $3 billion public system for treating individuals with severe mental illnesses, intellectual disabilities and addictions is heralded by advocates as being free of the financial pressures the commercial marketplace faces to squeeze out a profit. Those same advocates also acknowledge the system is sometimes inefficient, bulky and unable to meet a growing need for behavioral health care amid escalating financial pressures for the state’s overall Medicaid insurance program for low-income residents. The layers of oversight and administration of each dollar spent on mental health are daunting: Taxpayer funding starts in Washington and flows to Lansing through the Michigan Department of Health and Human Services, which contracts with 10 state-created prepaid inpatient health plans or PIHPs to manage care for fewer than 300,000 of Michigan’s 10 million residents. The regional PIHPs in turn contract with one of Michigan’s 46 community mental health authorities, an arm of county government. Those agencies then contract with behavioral health care providers, clinics and hospitals for services. “It’s not an easy system to navigate,” said Marianne Huff, president and CEO of the Mental Health Association of Michigan. ILLUSTRATION BY FERGS FOR CRAIN’S DETROIT BUSINESS

But CMHs only serve individuals with severe behavioral and mental health disorders. Medicaid recipients who have mild-to-moderate mental health disorders stay in the system run by commercial health insurers, causing some individuals to bounce between two different insurers, depending on their physical and behavioral health needs. “There definitely are a lot of layers to get down to the service lev-

el,” Kyle Williams, director of litigation at Disability Rights Michigan, a Lansing-based federally funded nonprofit that advocates for disabled adults and children. Removing a layer from this system of health care for the mind

has proved to be a daunting challenge, in part because there’s control of $3 billion in Medicaid spending at stake. An effort by former Gov. Rick Snyder’s administration to turn over management of the public mental health system to the Medicaid health plans in what’s referred to as “behavioral health integration” fizzled before the COVID-19 pandemic began consuming Gov. Gretchen Whitmer’s administration last year.

“Both sides of the issues have not accepted the fact that you’re not going to get everything you want and you shouldn’t go for everything you want,” said former state Rep. Joe Haveman, director of government relations at HOPE Network, a mental health services provider. “I think we saw that Lansing hates big changes.” See SYSTEM on Page 17

FEBRUARY 22, 2021 | CRAIN’S DETROIT BUSINESS | 13

MENTAL HEALTH CARE COMMENTARY

It’s time to end the workplace stigma of mental health treatment for em BY ANNALISE FRANK

I used to walk up a set of stairs and weave through hallways to get to my weekly therapy sessions. The familiar click of the office’s heavy front door told me it was time for that hour to start. Now it’s a ding from my laptop. “What’s on your mind?” my therapist asks to start. I’ve been seeing mental health professionals for years, one of a large and growing number of Americans who do so. And that demand has only surged during the pandemic. The stigma has faded in some of the discourse we see, but it remains ingrained in a lot of ways. One place we need to knock it back? The workplace. And the pandemic is — or at least it should be — a reckoning. Pre-pandemic, in 2019, nearly one in 10 Americans saw a mental health professional, according to the U.S. Centers for Disease Control and Prevention. Double that number experience any form of mental illness in a given year, the CDC says. And now, the percent of residents experiencing any kind of mental illness is just over 19 percent in Michigan, or an estimated 1.5 million, according to Virginia-based Mental Health America’s 2021 State of Mental Health in America report released in October. It’s skyrocketing during COVID-19, with Mental Health America seeing a 93 percent increase in the people looking for help with anxiety through its online screening program and 62 percent increase for depression. Loneliness and isolation are top factors. The American Psychological Association found that three-

fourths of psychologists treating anxiety, surveyed from August to October, reported demand was increasing and 30 percent said they couldn’t catch up with said demand. And with all this, access still lags. The financial reFrank covers the sources needed for treatment just don’t match up with what City of Detroit many people have. for Crain’s The problem is comDetroit Business pounded 100-fold for those without insurance, which make up 10.8 percent of those with mental illness, according to nonprofit Mental Health America’s October report. It’s a reality that continues during an outbreak with death, illness and isolation at the forefront of our minds. This column isn’t going to fix American health insurance. But look at how that societal disengagement with what’s going on in our heads plays out in your own workplace. “As the pandemic relentlessly persists, we are seeing the highest levels of anxiety and depression reported since the pandemic hit the U.S. in March,” Mental Health America writes of its findings, which come from the federal Substance Abuse and Mental Health Services Administration, CDC and Department of Education. “This is a troubling trend being fueled by loneliness and isolation. We are also seeing alarming numbers of children reporting thoughts of suicide and self-harm. The ... report confirms the trend that mental health in the U.S. continues to get worse and many states are

pulsive thoughts and behaviors that used to take up so much of my daily energy have receded to the back of my head. That’s been tested over the last year, with a highly contagious virus spreading, compounded with fear for vulnerable family members and the weight of the pandemic on our well-beings. Like so many of us, I needed treatment. I’m privileged and have continued to get it, through tele-therapy, and am thankful for the flexibility of my workplace. I close out my email, mute my Slack messaging notifications and log onto a HIPAA-compliant video-chatting system. How many in your workplace question themselves when, really, we all have times we need a breath of air? And how many are among the Mental Health America estimate of 24 percent of adult Michiganders with mental illness but unmet treatment needs? The report found that 86 percent of Americans who LETTING EMPLOYEES KNOW THEY DESERVE TO didn’t get treatment PRIORITIZE THEIR MENTAL HEALTH STARTS WITH did have insurance that covered it, “indiSHOWING IT’S OK. IF YOU THINK YOU CAN LEAVE IT cating that ensuring UNSTATED AND ASSUME THAT’S EVIDENT, THINK AGAIN. coverage is not the same as ensuring acdisorder make up crucial pieces of my identity. cess to care.” Michigan ranks 17th in the country for access At work, home, everywhere. Sure, that one counselor way back who con- to mental health care: insurance, treatment, sidered bringing in pig’s blood as part of expo- workforce availability and other measures, acsure therapy for my blood phobia may not have cording to the Mental Health America report. It helped a ton. But cognitive behavioral therapy ranks comparatively higher for adult access techniques, psychoanalysis, mindfulness — us- and lower for youth access. Letting employees know they deserve to priing these techniques has brought me to a place where the health-centric, germophobic com- oritize their mental health starts with showing ill-prepared to handle this crisis ...” I ask those in positions of power this, especially: How comfortable do those under you feel disclosing what they need without judgment or reprisal? Sure, they may be able to keep mental health issues and work separate to an extent, but 1) What happens when they can’t? and 2) Why should they, any more than another type of necessary medical appointment? Let’s take something as simple as, theoretically: “My therapist is booked because demand is so high. I need treatment but they only have morning appointments available.” That may wrack your employee with fear or guilt because, well, does needing this time make them weak? Are they less able to handle the challenges being thrown their way than their colleagues, and will there be concerns about their performance? No, no and no, there shouldn’t be. Things I’ve learned in therapy for my anxiety

INVESTING IN THE MENTAL WELLNESS OF OUR YOUTH

2021 VIRTUAL

Hilinski’s Hope

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• Service Providers Libby Rapin

• Educators • Parents • Anyone who works with youth Christina Meredith

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visit: YourChildrensFoundation.org/summit 14 | CRAIN’S DETROIT BUSINESS | FEBRUARY 22, 2021

T o

Join us for the 2021 Child and Adolescent Behavioral Health Summit. The virtual summit will feature a variety of topics on mental health and wellness by experts in the field. This two-day conference tackles best practices and wide range of issues affecting children and teens here in Michigan. From mindfulness for medical providers to suicide prevention and mental health of young athletes.

APRIL 13-14

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it’s OK. If you think you can leave it unstated and assume that’s evident, think again. Do some more research on the stigma those around you may be facing. Burnout, safety issues, stress and inadequate or harmful communication practices are among risk factors that can affect mental health at work, according to the World Health Organization and CDC. “Because of the stigma associated with mental disorders, employers need to ensure that individuals feel supported and able to ask for support in continuing with or returning to work and are provided with the necessary resources to do their job,” the WHO’s website says. “Mental health interventions should be delivered as part of an integrated health and well-being strategy that covers prevention, early identification, support and rehabilitation.” As always, we can trace this back to the bottom line. The lack of attention paid hurts the economy: A 2018 study put together by a global group of health experts, the Lancet Commission on Global Mental Health and Sustainable Development, reported mental health conditions will cost the world $16 trillion in “lost economic output, more than cancer, diabetes and respiratory diseases combined” through 2030. Employers: We all know how to nod when we hear mental health is important. But in 2021, be more. Be that force showing your employees it’s not only acceptable but encouraged to work on themselves. Don’t just allow. Do.

Mental health bureaucracy needs one less layer BY JAMES HAVEMAN

The vast majority of Michiganders receive physical and behavioral health care under one integrated umbrella. The one exception is the Medicaid publicly funded system, which has grown to include one in every 10 Michigan residents. Over 60 years ago, services for publicly funded persons who were mentally ill were “carved out” via the Michigan Mental Health Code. This meant a separate system of services was set up outside the standard health care system. However, there was fear then that the fragmented health care system did not fully understand the complexity of behavioral health as it relates to physical health. Michigan chose to create county Community Mental Health Boards. These boards controlled all the state and local funds. The “carveout” continued in the Mental Health Code revisions of 1995. In 1997, Michigan switched much of its health care purchasing for uninsured persons to qualified health plans. The “carveout” continued. In 2011, the state of Michigan created 10 regional Prepaid Inpatient Health Plans that serve as the taxpayer-funded insurer for treating severe behavioral health and developmental disabilities. Each one of the 47 Community Mental Health Boards fit into a region. The result was an additional layer of bureaucracy that did not lead to the expected consolidation of services and the integration of care. The “carveout” for the severely mentally ill adults continued with the expansion of Medicaid in 2014. Over 874,000 adults funded by the public system in Michigan now receive care via the qual-

ified health plans. But the system is still bifurcated. The severely mentally ill are being served by the Community Mental Health Boards, while those with mild/moderate mental illness are being served by the qualified health plans. Politics and legacy proJames Haveman grams stymied any change. was director of In fiscal year 2017, thenthe state Gov. Rick Snyder’s budget community contained Section 298, health which called for all funding department for behavioral health to be under former Republican Govs. contracted to the health plans who in turn would deJohn Engler and cide to contract with existRick Snyder. ing providers or Community Mental Health Boards for services. That recommendation created a firestorm of resistance from Community Mental Health Boards and advocates. A planning process to achieve true integration went on for three years. It was scrubbed last spring by the Michigan Department of Health and Human Services when the COVID-19 response dominated everything in government. We know behavioral disorders are diseases, and it is time to truly integrate care for them with the outstanding health care systems in Michigan. We must not continue to hold ourselves to structures and policies that are bloated, costly, redundant and confusing. Full integration of services is possible. We no longer need lengthy study groups but instead need to focus on the outcome desired. Billions are spent

in the public health system in Michigan and hundreds of millions would be saved by the standardization of services, reciprocity of credentials, and a common electronic medical file for all providers. Critics fear it’s all about the privatization of services. However, there is a long and valued history of both for-profits and nonprofits in Michigan providing vital services. When budgets are tough, rather than cut rates and benefits, we should be creative with new models utilizing streamlined integration of services. A few suggestions for moving forward. ` Do what section 298 wisely suggested and let the health plans determine who to contract with for services based on quality and costs. ` Leave the current system serving persons who are developmentally disabled in place, but redesign so consumers and their families have more choices of providers and services. ` Phase out the 10 regional PIHPs. ` Provide more crisis beds for children and adults in Michigan and adequately pay direct service workers. ` Permit health plans to spend increased health care funds on social determinants of health. It is estimated that 40 percent of health care costs are caused by lack of transportation, inadequate housing, food insecurity, lack of pharmaceuticals and public safety. ` Establish a statewide electronic medical file system that uses the newest technology of mobile communication and monitoring. The period following COVID-19 will add new challenges and opportunities for behavioral health. I am confident that the MDHHS can write contracts that will assure the desired outcomes for those needing a medical home. SPONSORED CONTENT

The pandemic’s toll on small business owners and easing their burden

By Brian Calley, President, Small Business Association of Michigan

The odds are against you when you start a new business. It is grueling to build an enterprise from an idea to a success. Entrepreneurs commonly put everything on the line to make it work—all their heart, money, assets and time. There are no words to adequately express the risk and concentrated pressure that comes with being a small business owner— not to mention the wear and tear on that owner’s mental health. And that is during good economic times. The pandemic has brought additional, extraordinary challenges and extreme uncertainty to all small business owners, but especially those in industries most directly impacted by closure orders. From last spring’s broad lockdowns to extended closures finally relenting now, this pandemic has taken an emotional and mental toll on the men and women who own and operate Michigan’s small businesses. When a business fails, a business owner doesn’t just lose a job—they usually have their whole net worth invested in the business. They personally guarantee the debt and often use their home as collateral. When a business goes under, a business owner loses everything. But even those who make it through to the

other side of this pandemic are suffering. Over the last 10 months I’ve talked with hundreds of small business owners. I’ve seen famous pivots and heroic transformations. I’ve seen some businesses bounce right back from the economic meltdown in the spring. But I’ve also seen those who made the gut-wrenching decision to lay off employees, use the last of the equity in their home, cash in IRAs and go months without paying themselves to keep paying their employees. While trying to save their business, sometimes barely holding it together with little more than the sheer will to survive, business owners have had a slew of new challenges thrown at them with little or no warning: • Transitioning to a remote workforce overnight. • Purchasing and incorporating new technology to accommodate remote work. • Watching closures push their customers toward multinational corporations and pivoting to new, virtual business models on the fly to try to win those customers back. • Interpreting complicated and

ever-changing government orders and regulatory language. • Competing with the federal and state unemployment system for their employees. • Managing both employees with grave concerns about the virus and those who resist safety measures. • Operating under a microscope with customers and even competitors looking to catch them doing something wrong. • Dealing with angry and sometimes violent customers who refuse to comply with face mask requirements. I could go on and on. Small business owners know how to work hard. They know how to give. They treat their customers and employees like family. The communities they work in are the communities they live in. Having a strong small business community is not just a luxury, it is a necessity for our economy. The personal investment and dedication required of small business owners is enormously taxing, emotionally as well as financially. Small business owners are hurting and need support.

And yet, the second round draws of the Paycheck Protection Program are lagging, in part because many business owners do not feel right about receiving support despite unprecedented challenges. They are givers. It is not natural for them to ask anything of anyone. So I will ask for them. 1. Go out of your way to support local businesses. Take a moment to consider whether you could purchase an item closer to home. There are local options with online fulfillment and curbside pickup. 2. Don’t give staff a hard time when they enforce the safety rules. They’re just doing their job. 3. Support businesses that want to reopen and stay open. All businesses deserve an opportunity to be open when they follow the rules. The very character of our communities is built on a foundation provided by small businesses. Doing what we can to widen the lane to their survival is well worth the effort.

FEBRUARY 22, 2021 | CRAIN’S DETROIT BUSINESS | 15

MENTAL HEALTH CARE COMMENTARY

Start treating mental health crises like other medical emergencies BY EMILY KIELISZEWSKI

Every crisis has a turning point: for the better, or for the worse. Attempting to sleep under a single hospital sheet on the cold tile floor of a room in the ER, it felt like things were teetering toward worse. It was the middle of the night, and in the bed next to me was my sibling experiencing a mental health crisis. We were in limbo, desperately hoping to find an open bed at an inpatient care facility that could provide appropriate — and lifesaving — medical care not offered by our local hospital. With 276 inpatient psychiatric beds available to children in the state, we knew the chances were slim. By morning, still no openings. Eventually, we left — a family in crisis — without any medical care for a child in urgent need. No treatment. No plan for follow-up care. And what felt like no hope. It’s hard to believe any other medical crisis — a cardiac event, an asthma attack, even diabetes — would be treated similarly. Exacerbated by COVID-19 stress, anxiety, uncertainty, and trauma, mental health has moved to the forefront of social and policy discussion. To Michigan’s credit, the state moved quickly to respond with sweeping mental health services including a mental health “warm line” to connect callers with certified peer support specialists, and a service that allows individuals experiencing a mental health crisis to access a trained counselor via text. Addressing pandemic-related mental health issues is also key part of Gov. Gretchen Whitmer’s

COVID-19 recovery plan with more mental health funding included as part of her recently released state budget proposal. Despite these efforts, the surge of mental health challenges brought on by the pandemic sits atop a mental health care system Kieliszewski is already in crisis. A shortage vice president of of mental health profesthe board of the sionals, limited access to Michigan inpatient psychiatric facilichapter of the ties, and affordability chalNational lenges are among the realiAlliance on ties that plagued our system Mental Illness. long before COVID-19. Opportunity is knocking. It appears our administration, Legislature, key stakeholders and public interest may align — just enough — to move the needle when it comes to mental health care in our state. But fixing the access and capacity issues alone is a mistake. Step away from the BandAids. We can celebrate when we’ve also addressed the model of care to improve the outcomes for people who need it. For those who’ve experienced the mental health system firsthand, it’s difficult to imagine a world where care for a psychological illness is treated as seriously as any other disease — with a swift, comprehensive medical response. Most people wait an average of 74 weeks after their first episode of psychosis before they’re able to receive care. This inadequate, delayed treatment costs our

More on crainsdetroit.com ` Marianne Huff: The president and CEO of the Mental Health Association in Michigan lays out what real behavioral health integration looks like. ` Tom Watkins: Former president and CEO the Detroit Wayne Integrated Health Network presents a series of proposed reforms to Michigan’s mental health system. ` Colleen Allen and Sherri Boyd: Autism Alliance of Michigan CEO Allen and The Arc of Michigan’s CEO Boyd argue that boosting wages for direct care workers will do more to strengthen services for the mentally ill and developmentally disabled than anything else right now. ` Dennis Mouras: CEO of UnitedHealthcare Community Plan of Michigan says Michigan’s Medicaid system is riddled with overlap in physical, behavioral health.

national economy an estimated $155.7 billion a year in direct health care costs, unemployment, and lost productivity for caregivers. Studies by the National Institute of Mental Health show that if we intervene earlier with a robust approach, the clinical and quality-of-life outcomes for individuals are better, making the investment a greater value over the long run. The model already exists: Coordinated specialty care is the research-backed standard for treating individuals with first episode psychosis.

This comprehensive treatment system involves the individual, their family, and their primary care alongside therapy, medication management, peer support, and education or employment support. Coordinated specialty care-first episode psychosis manages beyond symptoms, and moves away from costly, crisis-driven models to deliver effective, recovery-oriented care. Predictably, the earlier individuals receive this team-based treatment approach, the better the outcomes. They stay in treatment longer, are more likely to stay in school or working, and are more likely to maintain social connections compared with those receiving only basic mental health care. For our young people, this programming could be particularly transformative. Roughly 50 percent of mental illness begins by age 14, and 75 percent begins by age 24. The question is not whether early intervention works, but how these specialty care programs can be implemented in community settings throughout Michigan. While a few successful Coordinated specialty care-first episode psychosis programs are already in place across the state, we need policy and fiscal support from the Legislature, the Michigan Department of Health and Human Services, third party payers and other stakeholders to encourage meaningful development of early intervention programs for all Michiganders. We’re at the precipice. Now, all we need to do is meet the moment. We get to choose, at this crisis turning point, for better or for worse. If we’re going to choose for better, let’s really go for better. SPONSORED CONTENT

Reform Medicaid to close gap in behavioral health care access

By Dominick Pallone, Executive Director, Michigan Association of Health Plans

The exponential expansion of telehealth in the last year, fueled by the necessity to limit unnecessary social interaction, has been well documented. For example, one health plan’s utilization of telehealth increased from about 100 virtual visits a week to more than 4,000 per week in April and May of 2020: many of these telehealth visits addressed behavioral health issues. We overlook that the primary driver of telehealth expansion has been to meet mental health treatment needs. In fact, an estimated one in three telehealth encounters during the pandemic have addressed behavioral health issues—including substance use—within the commercial market, compared to two in three in the Medicaid market. The last 10 months have highlighted that many Michiganders’ behavioral health needs went unmet prior to the COVID-19 pandemic. The gap in access to high quality, affordable behavioral health care for those enrolled in Medicaid has never been so apparent. Opportunities for improvement are

16 | CRAIN’S DETROIT BUSINESS | FEBRUARY 22, 2021

born out of crisis, and the Medicaid program in Michigan is in the midst of a behavioral health access crisis. Our system treats the physical and behavioral health needs of the Medicaid population as if they are unrelated. This siloed approach is a relic from a time when mental health was commonly viewed as unequal, or even unrelated, to physical well-being. Policy makers in Lansing need to take immediate action to fix our bifurcated, broken and wasteful system. Policy makers should immediately address this behavioral health access crisis by reforming the Medicaid program. The model to follow is the one used by millions of Michiganders who receive their health insurance benefits from employers or purchase them on the federal Health Insurance Marketplace. Fully integrate the financial, operational and clinical structures of the Medicaid program under one resource—the enrollee’s health plan. Studies have shown that health care spending can increase up to 75 percent when beneficiaries with a chronic

physical condition also have a mental illness. Nationally, Medicaid beneficiaries with a behavioral health diagnosis account for almost half of total Medicaid expenditures. States like Arizona and Washington have already integrated physical and behavioral health benefits under accountable managed care organizations and they have achieved amazing results—improving all measures of ambulatory care, preventive care and chronic disease management, while also achieving improvements in beneficiary satisfaction scores. This means a financially, operationally and clinically integrated Medicaid program has been proven to improve the overall health of the population it serves, reduce the

cost to taxpayers of providing those services, and improve patient satisfaction. Michigan is ripe for reinventing our behavioral health system to serve our enrollees and the model is clear. The data clearly speaks to a need and behavioral health should not be a partisan issue. In this era of hyperpartisan hyperbole, reforming Medicaid to treat the whole person would be a victory for Democrats, Republicans, taxpayers and, most importantly, beneficiaries who deserve better care.

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The global public health crisis has laid bare long-simmering problems with access to care in Michigan, reviving calls to change the way mental health services are delivered in a bureaucracy that requires a diagram to understand. At MDHHS, the pandemic has paused all activity on making wholesale changes to the community mental health system. “We’re going to continue the hiatus because COVID is our main focus,” said Allen Jansen, senior deputy director of MDHHS’ behavioral health and developmental disabilities administration. Before COVID, state and local health officials, the health insurers and behavioral health advocates spent three years debating changes to the system under what is known as Section 298, the boilerplate language that called for privatization that Snyder first proposed in the $25 billion MDHHS budget in 2017. “Nobody wanted to lose power,” said state Rep. Mary Whiteford, an Allegan County Republican who chairs the House Appropriations subcommittee for the MDHHS budget. “I would love to see them just go back to providing care. But it’s big money.”

Michigan Community Mental Health Service Program Boards

Pre-paid Inpatient Health Plans

The map on the left shows which CMHSPs currently cover each county in Michigan. CMHSPs that are responsible for a single county are shown in beige. Colored counties are covered by a multi-county CMHSP. There are 46 CMHSPs covering all 83 Michigan counties.

The map on the right shows the Pre-paid Inpatient Health Plans (PIHP) and coordinating coverage areas in Michigan that began in 2014. Currently there are 10 PIHPs responsible for 46 CMHs covering all 83 Michigan counties. Keweenaw

Keweenaw Houghton

Houghton Ontonagon

Ontonagon

Baraga

Gogebic

Marquette Iron Dickinson

Luce Alger

Chippewa

Schoolcraft

Mackinac

Dickinson

Emmet

Menominee

Charlevoix

Single county CMHSPs (32) Au Sable Valley (3) Bay-Arenac (2) CMH for Central Michigan (6) Clinton-Eaton-Ingham (3) Copper Country (4) Hiawatha (3) Lifeways (2) Manistee-Benzie (2) North Country (6) Northeast Michigan (4) Northern Lakes CMH (6) Northpointe (3) Pathways (4) West Michigan (3)

Alpena Montmorency

Clare Gladwin

Arenac Huron

Mecosta Isabella Midland Bay

Oceana Newaygo

Montcalm

Muskegon Ottawa

Kent

Ionia

Gratiot

Saginaw

Mackinac

Delta

Emmet

Antrim

PIHP regions (number of counties)

Manistee Wexford Missaukee Ogemaw Iosco Roscommon Osceola

Chippewa

Schoolcraft

Charlevoix

Leelanau Grand Kalkaska Crawford Oscoda Alcona Benzie Traverse

Lake

Luce Alger

Menominee

Cheboygan Presque Isle

Otsego

Antrim

Mason

Marquette Iron

Delta

CMHSP boards (number of counties)

Baraga

Gogebic

Tuscola

Genesee Lapeer Clinton Shlawassee

Sanilac St. Clair

Region 1 (15) Region 2 (21) Region 3 (7) Region 4 (8) Region 5 (21) Region 6 (4) Region 7 (1) Region 8 (1) Region 9 (1) Region 10 (4)

Cheboygan Presque Isle

Otsego

Montmorency Alpena

Leelanau Grand Kalkaska Crawford Oscoda Alcona Benzie Traverse Manistee Wexford Missaukee Ogemaw Iosco Roscommon Mason Oceana

Lake

Osceola

Newaygo

Clare Gladwin

Huron

Mecosta Isabella Midland Bay Montcalm

Muskegon Ottawa

Arenac

Kent

Ionia

Gratiot

Saginaw

Tuscola

Genesee Lapeer Clinton Shlawassee

Macomb Allegan

Barry

Eaton

Van Buren Kalamazoo Calhoun Berrien Cass

Jackson Washtenaw Wayne Monroe

St. Clair Macomb

Allegan

Ingham Livingston Oakland

St. Joseph Branch Hillsdale Lenawee

Sanilac

Barry

Eaton

Van Buren Kalamazoo Calhoun Berrien Cass

Ingham Livingston Oakland Jackson Washtenaw Wayne

St. Joseph Branch Hillsdale Lenawee

Monroe

Awash in red ink CRAIN’S DETROIT BUSINESS GRAPHIC

SOURCE: CENTER FOR HEALTH AND RESEARCH TRANSFORMATION; MICHIGAN DEPARTMENT OF COMMUNITY HEALTH BEHAVIORAL HEALTH DEVELOPMENTAL DISABILITIES ADMINISTRATION

Much like Michigan’s no-fault auto insurance system, the community mental health system is seen by some as a model to the country that focuses on keeping people in their homes and communities — and out of psychiatric hospitals. And like Michigan’s once-mandatory unlimited medical benefit for injured drivers, a comprehensive mental health system also is costly — and those pressures have gotten worse in recent years. In some corners of the state, the publicly run behavioral health system was awash in red ink before the pandemic. In 2019, MDHHS yanked a contract for the Lakeshore Regional Entity that oversees the flow of behavioral health Medicaid funding to seven counties in West Michigan because the PIHP had run up a $16 million structural deficit. During that same time period, the four-county PIHP that distributes $163 million annually in Medicaid dollars to behavioral health providers in Lenawee, Livingston, Monroe and Washtenaw counties said it racked up nearly $42 million in deficit spending in fiscal years 2017, 2018 and 2019, according to court records. To get by, the Washtenaw County Community Mental Health Agency covered a $10 million shortfall in 2019 with “local funds meant for other purposes ... putting other county obligations at risk,” according to a lawsuit filed against MDHHS last year seeking a state bailout. At the end of 2018, Macomb County Community Mental Health had less than $200,000 in its risk reserve fund — a dangerously low amount of cash on hand for a health care organization with a $250 million annual budget. All told, nine of Michigan’s 10 PIHPs had structural deficits of nearly $93 million in 2018, according to financial data compiled by the Michigan Association of Health Plans, the trade organization for private health insurers in the Medicaid managed-care business. For critics of the public health system, including the private insurance

companies vying for a slice of Michigan’s $20 billion Medicaid pie, the chronic deficits point to a system of care where each tax dollar travels through multiple layers of government. Having Medicaid patients in need of treatment for psychosis or a controlled substance addiction leads to a “finger pointing over who’s responsible for paying” for behavioral and physical health problems that often intersect, said Dominick Pallone, executive director of the Michigan Association of Health Plans. “At the end of the day, we’re trying to make the Medicaid benefit look and feel a lot more like a commercial benefit,” said Pallone, whose organization represents 12 major health plans. Michigan’s 10 regional PIHPs are unlicensed public insurance and managed care entities created by statute in 2011. They receive a set amount of dollars from the Michigan Department of Health and Human Services to contract with 46 community mental health authorities that encompass single counties in populous southern Michigan and multiple counties Up North. The bureaucracy of Michigan’s public mental health system comes with a contract that’s some 700 pages long. “When the money comes to us, it also comes with a lot of requirements — and a lot of those requirements just cost money,” said Dave Pankotai, CEO of Macomb County Community Mental Health.

State ‘very shorthanded’ MAHP has argued for years that integrating care will not just lead to cost savings, it will create better outcomes. The association representing Health Alliance Plan, McLaren Health Plan, Molina Health Plan and other insurers contend they can better manage a person’s care than having them move into the public system when they require hospitalization or

contracts with the 10 PIHPs and 46 community mental health authorities. “A lot of the problems legislators and others hear about in community mental health would go away if people could be held accountable in the contracts,” Huff said. Whiteford acknowledged the 14,000-employee state health department is “very shorthanded” in this area. Allen, the MDHHS official, said he needs eight employees to oversee the contracts and that hiring for those positions is a priority. Whiteford said she wants to see the 10 PIHPs consolidated into one entity. But such a move wouldn’t obliterate an entire bureaucracy, Huff said. “That would still mean administrative costs because you’d have to have the ability to hold 46 CMHs accountable,” she said. Kevin Fischer, executive director of Michigan’s chapter of the National Alliance on Men”NOW WE GET TO CONTROL tal Illness, said the public OUR FRONT DOOR MAKING mental health system THOSE CRITICAL DECISIONS needs to become more effiABOUT WHO GETS IN, WHERE cient. But Fischer is not convinced privatizing the pubTHEY RECEIVE SERVICES.” lic mental health system — Eric Doeh, Detroit Wayne Integrated will help matters. Health Network deputy CEO “Those cost savings can “That’s something I don’t think the be achieved without turning it over to health plans and the traditional in- the health plans,” Fischer said. “The surance companies have a knowl- health plans don’t see or truly appreciedge and understanding of,” said ate all of the social supports that the Huff, who ran the Allegan County public system provides for the person.” Community Mental Health agency from 2010 to 2017. Changes underway Huff contends what ails the multitiered community mental health sysThere have been incremental tem is a policy change in 2014 that changes in recent years to integrate shifted money out of Medicaid mental care without turning the payment health and into the expanded Medic- model on its head. Some hospitals aid physical health insurance benefit have established specialized crisis for low-income adults. units to keep people with mental Allegan County alone sustained a health crises out of emergency rooms. 65 percent reduction in funding that The federal government is now year. “The carnage that caused is still funding the establishment of Certihappening today,” Huff said. fied Community Behavioral Health MDHHS has just three full-time Clinics that are designed to integrate workers whose sole job is to enforce primary care with mental health. intensive outpatient therapy. Advocates for the public mental health system are skeptical the health plans understand the intricacies of case management for individuals whose needs go beyond clinical treatment. “We don’t look for cost savings in terms of denying care,” said Dana Lasenby, CEO of the Oakland County Community Health Network. “I don’t think (the health plans) truly have an idea of all the things that we do. I think they’re looking at bottom lines and our budget ... (and) thinking they can do it cheaper and have cost savings. It’s not an apples-to-apples system that you can just take over.” Community mental health agencies are involved in placing individuals in housing and ensuring they’re stabilized to remain there — cost-intensive case management work, said Marianne Huff, president & CEO of the Mental Health Association of Michigan.

There are 18 such clinics across the state, though none have been established in the northern Lower Peninsula and Upper Peninsula, according to the Center for Health and Research Transformation in Ann Arbor. “I think we’re all trying to figure out what that integration is going to look like,” said Dr. Amy McKenzie, associate chief medical officer for Blue Cross Blue Shield of Michigan. In recent years, the Detroit Wayne Integrated Health Network axed a vendor contract for inbound phone calls from Wayne County residents seeking mental health services and eliminated a layer of its bureaucracy that created sub-networks of providers. Those functions were brought in-house, DWIHN Deputy CEO Eric Doeh said. “Now we get to control our front door making those critical decisions about who gets in, where they receive services,” Doeh said. Since the statewide behavioral health integration project failed to reach a conclusion, DWIHN has been working on developing a smaller-scale project integrating physical and behavioral health. DWIHN has partnered with two health plans that serve 14,000 common Medicaid clients to coordinate care and get medical doctors talking with behavioral health clinicians to work together on each patient’s needs, DWIHN Deputy CEO Eric Doeh said. Doeh said he could not disclose the names of the two health plans. Mindful of the political pressures to produce savings within the Medicaid budget, DWIHN is trying to be proactive about behavioral health before lawmakers make another run at privatizing the system, Doeh said. “And believe me, we don’t want legislators deciding this issue for us,” Doeh told Crain’s. “Legislators, as much as they have great knowledge, when it comes to this piece right here, the folks who are knowledgeable are the folks who experience it every day.” Contact: clivengood@crain.com; (313) 446-1654; @ChadLivengood

FEBRUARY 22, 2021 | CRAIN’S DETROIT BUSINESS | 17

MENTAL HEALTH CARE COMMENTARY

Medicaid needs to account for physical, behavioral health overlap BY DENN S MOURAS

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October 30, 2017 | crainsdetroit.com PHOTOGRAPH BY JACOB LEWKOW FOR CRAIN’S

UBS to open downtown Detroit office By Annalise Frank

October 30, 2017 | crainsdetroit.com

• UBS plans to open wealth management office in Detroit in mid-2018 • Office to include 6,000-squarefoot space30,nonprofits and civic October 2017 | crainsdetroit.com

UBS to open downtown Detroit office By Annalise Frank

groups • UBS plans to open wealthcan use free of charge • Bedrock-owned buildings

office in Detroit “I’m impacting lives now. management I know undergoing renovations in mid-2018 6,000-squarethe effect food insecurity• Office had onto includeUBS plans to open an office in downfoot space nonprofits and civic town Detroit in mid-2018, the company Annalise Frank growing groups meByand my peers up, andcan useannounced free of charge Monday. • Bedrock-ownedUBS buildings Group AG’s U.S. and Canadian UBSan plans to open wealth this•was opportunity toundergoing make a renovations wealth management business, New Jermanagement office in Detroit sey-based Wealth Management change I wish an adult UBScould plans to open an office UBS in downin that mid-2018 Americas, to lease 13,000 square town Detroit in mid-2018, theplans company • Office to include 6,000-squarefeet on the connected sixth floors of have made for me.” announced Monday. foot space nonprofits and civic

UBS to open downtown Detroit office Bedrock LLC

hroughout Dandridge Floyd’s careers — whether as a social worker, attorney or assistant superintendent of Oakland Schools — making change has always been a center point. When United Way pitched a framework to Oakland Schools for a countywide breakfast program to address poor nutrition as a way to improve academic achievement, Floyd — who experienced food insecurity growing up — knew firsthand the powerful impact it could have. To secure the needed funds, Floyd led a team that earned support from all 28 local districts to finance the program — despite the fact that a majority of them would see no benefit. “The local districts were phenomenal,” Floyd said. “The biggest surprise was how quickly it happened. Education is a democratic system and democracy can be very slow, but this happened in six to seven months. That showed how committed people were to making sure the students of Oakland County have everything they need to be successful.” In a county where over 7,000 children suffer from hunger, and only two in five eligible students access a school breakfast, Floyd said a common misperception is that “Oakland County is rich.” “That makes this program all the more important, because if that is the bias or the thought process people have about Oakland County, then these kids would have never gotten help.” In a groundbreaking public/nonprofit partnership between the Oakland County Board of Commissioners, Oakland Schools and United Way, Oakland County is Better with Breakfast was born. “I’m impacting lives now,” Floyd said. “I know the effect food insecurity had on me and my peers growing up, and this was an opportunity to make a change that I wish an adult could have made for me.” — Laura Cassar

UBS will lease 13,000 feet from Bedrock LLC starting around mid-2018 in two buildings: the Grinnell Building (center left) at 1515 Woodward Ave. and the Sanders Building (center right) at 1529

Bedrock LLC

buildings at 1515 Wood- Woodward Ave. Group AG’sneighboring U.S. and Canadian groups can use free UBS of charge ward Ave. and Fourteen metro Detroit employees don’t really have adequate resources wealth management business, New 1529 Jer- Woodward Ave. • Bedrock-owned buildings The twoManagement buildings built around 1900 are will move to the downtown office to or adequate office space to host dosey-based UBS Wealth undergoing renovations by Detroit-based will lease LLC 13,000 feet from Bedrock LLC starting around mid-2018 buildings: Grin- meetings or things nor events the or board start, but the office has the capacity toin two Americas, plans toowned lease 13,000 square UBSBedrock nell Building (center at 1515 Woodward andnew the Sanders Buildingalong (centerthose right) at 1529 Bush said. and are undergoing said left) lines,” hold another six toAve. eight staff memon inthe connected sixth floors of renovations, Reprinted with permission from Crain’s Detroit Business. © 2019 Crain Communications Inc. All RightsUBS reserved. plans to open anfeet office downAve. for bers, Bush said. It will act as an extension John Bush, 60, WoodMichiganWoodward market head UBS’s investment in the new ofneighboring buildings at 1515 Further duplication without permission is prohibited. Visit www.crainsdetroit.com. #CD1134 town Detroit in mid-2018, the company UBS Wealth ManagementFourteen Americas.metro of fice will resources be “significant,” he said, as its the other wealth management offices. don’t really have adequate Detroit employees announced Monday. ward Ave. and 1529 Woodward Ave. “The real impetus open atonew The twoCanadian buildings built around 1900 arefor us “uniqueness Bush is based Birmingham office space to hostcomes do- at a price.” He said willto move the downtown office out to ofortheadequate UBS Group AG’s U.S. and office inBedrock Detroit is to support what’s owned by Detroit-based LLC he could or not yet provide an estimate but travels to to the will meetings norothers eventsand or board things start, but the goofficeoffice, has the capacity wealth management business, New Jering renovations, on in the city, ” saidhold Bush, a Detroit and are undergoing said on the be spending in thealong Detroit branch. those lines,” Bush said.cost of the build-out, as some another six to eight new stafftime memsey-based UBS Wealth Management nativemarket who grew City. “We John Bush, 60, Michigan headup forin Garden have yet The location have atheless UBS’s investment in the new of- to be finalized. said. will act asDetroit an extension fromBush Bedrock LLCItstarting around mid-2018 in twowill buildings: Grin- contracts Americas, plans to lease 13,000 square UBS will lease 13,000 feetbers, UBS Wealth Management Americas. really felt like we wantedofto have a physfice will be “significant,” hecompany said, as its the other wealth management offices. The plans to start its buildtraditional, more “urban” feelright) than 1515 Woodward Ave. and the Sanders Building (center atthe 1529 feet on the connected sixth floors of nell Building (center left) at “The real impetus for us to open new ical presence downtown to reinforce “uniqueness comes at saidnext year, depending Bush is based outothers, of the he Birmingham outa price.” processHeearly said. New York-based architecAve. a neighboring buildings office at 1515 Wood- toWoodward in Detroit is our support go-particular vision what’s for this areatravels and toture he will could not yet an estimate office, but the firm others and will Cale on when renovations on the buildings Verderame design the provide ward Ave. and 1529 ing Woodward don’t really have adequate resources Fourteen metro Detroit employees on in theAve. city,”tosaid Bush, a Detroit reinforce our on Barton the cost of the build-out, as some be spending time inspace; the Detroit branch. are complete. Southfield-based Malow The two buildings builtnative around 1900 areup in adequate office space to have host dowill moveCity. to tothe officelocation to or will who grew Garden “Wedowntown commitment contracts finalized. The Detroit have aon less based in Switzerland, employs Co. has signed as general contractor.yet to beUBS, owned by Detroit-based Bedrock nor events or board or things start, thea physoffice has the capacity really felt likeLLC we wanted tobut The company plans to startacross its buildtraditional, moreto“urban” than the outmeetings the city. ” have 60,000 54 countries. About 34 UBS feel plans to rent about half of the and are undergoing renovations, along those lines,” Bush said. early next year, depending hold six to eight new he staff memical presencesaid downtown toWealth reinforce others, said. New office York-based architecUBS another — 6,000 square out feetprocess — at no cost percent of them work in the AmeriJohn Bush, 60, Michiganour market head UBS’s investment the renovations new of- on the buildings bers, said. It will act an extension vision for for thisMparticular oninorganizations, when tureasfirm VerderametoCale will design theother a n aBush g e marea e n tand cas, according to a news release. UBS nonprofits and UBS Wealth Management will beMalow “significant,” he said, as its of the other also wealth management offices. ficeBarton to Americas. reinforce our Americas are be complete. space; Southfield-based Bush said. The space will called UBS Wealth Management Americas em“The real impetus for commitment us to open a new “uniqueness comes at a price.” He said is based thehas Birmingham to has Bush based signed on as Woodward general contractor. metro De- out ofCo. ploys 280employs in Michigan, 225 of whom Gallery. Its UBS, design and in artSwitzerland, office in Detroit is to support what’s go- office, but travels to theUBS heabout couldhalf not an estimate others and the city. ” 60,000 across 54 countries. 34 Detroit. plans towill rent will out of yet the provide troit offices in are basedAbout in metro aim to showcase Detroit’s history ing on in the city,” said Bush, on the cost the build-out, asthem somework in the Amerispending Detroit branch. UBS a Detroit Wealth B be percent office — 6,000 square at noofcost irm i n g h a time m , in the The wealth management business andfeet a— hub-and-spoke layout ofwill renative who grew up in Garden contracts have yet tocas, be finalized. M a n a gCity. e m“We e n t Troy, The Detroit locationtowill have a and less other according to a news release. UBS nonprofits organizations, Farmington recorded operating income of $2.13 flect the city’s road system. really felt like we wanted to have a physAmericas also Hills, The plans to startManagement its buildtraditional, more “urban” Wealth Americas em- quarter of 2017 — a Bushfeel said.than The the space will becompany called Plymouth in the third “Some of theUBS organizations that op- billion ical presence downtown reinforce has tometro De- others, he said. New York-based outdesign process early year,280 depending architecploys in Michigan, 225 of whom Woodward Gallery. Its and art next John Bush erate and Dearborn. and provide services in the city 7 percent increase over last year. our vision for this particular area and troit offices in ture firm Verderame Cale when renovations the buildings the onDetroit’s in metro Detroit. will will aimdesign to showcase history areonbased to reinforce our B i r m i n g h a m , space; Southfield-based complete. Malow arelayout The wealth management business andBarton a hub-and-spoke will reReprinted with permission from Crain’s Detroit Business. © 2019 Crain Communications Inc. All Rights reserved. commitment to Troy, Farmington Co. has signed on as general UBS, basedis prohibited. in Switzerland, employs income recorded operating contractor. flectFurther the city’s road without system. duplication permission Visit www.crainsdetroit.com. #CD936of $2.13 Hills, Plymouth the city.” billion in About the third “Somehalf of the organizations that op60,000 across 54 countries. 34quarter of 2017 — a UBS plans to rent out about of the John Bush and Dearborn. UBS Wealth 7 percent and provide city work percentinofthe them in theincrease Ameri-over last year. office — 6,000 squareerate feet — at no cost services Management to nonprofits and other organizations, cas, according to a news release. UBS Reprinted with permission from Crain’s Crain Communications Inc. All Rights reserved. Americas also Wealth Management Americas emBush said. The space will be Detroit calledBusiness. UBS © 2019 Further duplication without permission is prohibited. Visit www.crainsdetroit.com. #CD936 has metro DeWoodward Gallery. Its design and art ploys 280 in Michigan, 225 of whom troit offices in will aim to showcase Detroit’s history are based in metro Detroit. Birmingham, The wealth management business and a hub-and-spoke layout will reCRAINSDETROIT.COM I MARCH 9, 2020 I Troy, Farmington recorded operating income of $2.13 flect the city’s road system. THE CONVERSATION Hills, Plymouth “Some of the organizations that op- billion in the third quarter of 2017 — a John Bush erate and provide services in the city 7 percent increase over last year. and Dearborn.

Albert Berriz talks workforce housing, Ann Arbor and Cuba

Reprinted with permission from Crain’s Detroit Business. © 2019 Crain Communications Inc. All Rights reserved. | BY KIRK PINHO Further duplication without permission is prohibited. Visit www.crainsdetroit.com. #CD936

MCKINLEY INC.: Ann Arbor-based real estate company McKinley Inc. saw the writing on the wall for its retail portfolio a few years ago and cut bait, turning its focus primarily to its large crop of tens of thousands of workforce housing units across the country. One of the people at the helm of that decision was Albert Berriz, CEO and managing member, who came to America as a young boy fleeing Cuba and now steers a large company with a portfolio valued at more than $4 billion. `Crain’s Detroit Business: Can you talk a little bit about how the McKinley portfolio began and where it’s at today? Berriz: McKinley started in 1968 in Ann Arbor, and it was founded by (former U.S.) Ambassador Ron Weiser. It started in the student housing business and eventually transitioned into more traditional multifamily housing, and in addition to that, office and retail, as well. Today, we’re primarily a workforce housing multifamily operator. We have essentially disposed of our retail and office assets in an effort to really focus on multifamily and also focus on an asset class that I think is more in line with our current goal, which is to have a generational multifamily real estate enterprise and a pool of assets that really are long term in nature. ` Explain workf workforce housing versus affordable housing. We’re not in luxury housing. Our residents are working. They’re going to wake up tomorrow morning and go to work. Our average rents are, for example, in Washtenaw County, about $1,100 to $1,200 or in Orange County, or Seminole County, Florida, $1,400 or $1,500. So these are affordable rents. And the difference between us and affordable housing is our buildings are not subsidized. They’re all market rate, and they’re all privately owned. The owners are not receiving any form of subsidy, nor are the residents. However, if you wanted to sort of assess residents and low-income housing tax credit deals compared to ours, they’re probably not too dissimilar, the median incomes. The McKinley residents in, let’s say, Washtenaw County, when you look at the numbers are probably not going to be too much different than what you would see in a traditional LIHTC deal. But again, our buildings, the primary differences, our buildings are market rate and they’re not subsidized any way.

`II don’t don’ think it’s overblown to use the word “crisis” for Ann Arbor’s affordafford able housing situation. Give us your perspective on how the city should go about addressing it. I think it’s a supply issue. The reality is that Ann Arbor has not really welcomed solutions from the private sector and has only sought solutions from the public housing side or the community nonprofit side. And both of those groups, while I think they’re very well intentioned, don’t have the capital and the expertise to resolve the problem at the scale it’s needed. To put it in perspective, you know, the Washtenaw County study that came out had a need of about 3,000 units. And if you look at the cost per unit today, and let’s say $250,000 or $300,000 per unit to build a brand new unit today, you know, it’s an $800 million to a $1 billion problem, so I don’t think that’s a problem that gets resolved on the public side or on the community nonprofit side. You know, they have to go to places to seek capital and there just isn’t enough capital, nor do they have enough resources or expertise to resolve the problems. So the city I think, by and large, has attempted to do this in those ways because they really haven’t welcomed the private side. And there is a lot of expertise and there’s a lot of capital that could do this, from the private side perspective. It just hasn’t been the way that Ann Arbor operates, so you see what has happened in Ann Arbor year over year, decade over decade is there’s a lot of conversations about affordable housing, but there’s no solutions. `You were talking a little bit earlier about how McKinley got out of retail and office. What led to that decision and how has that reflected or shaped your business strategy? It was a risk profile that we were just not comfortable with. We are a generational business and so we look at our assets in

a way that we never expect to sell them. We expect to invest in them so they last for long term, and we just couldn’t see that on retail. We saw a significant degradation of our rent rolls. We had buildings that were, let’s say, 70 percent to 80 percent investment-grade credit tenant composition and then we saw that we saw that quickly degrade. We just didn’t see a place where we could really have an asset class retail that would last for the long run. And then office in many ways, the same way. The way people are shopping and the way people are occupying offices today, the risk profile is very different than it was, let’s say, when we were making those investments 20 and 30 years ago, so for us, it was the right move. It’s paid off because, had we held many of the assets today, they would be significantly compromised. I think they would be worth a lot less. We started those sales about six years ago, and we sold a lot of that early on, so we sold them still at a time they were being valued significantly more than they would be worth today, in our opinion. And we sold some big buildings. I mean, these weren’t small buildings. We sold a 1 millionsquare-foot shopping center, for example, in Norfolk, Va., which is one of the largest power centers in the state of Virginia. So these weren’t small assets. So they were important for us to move them out at the right time, and for people that thought that was there was a good upside for them, so we actually sold them at good prices, and certainly we couldn’t have sold them at those prices today.

trajectory was to where you are today in terms of the head of McKinley. I left (Cuba) compliments of Fidel Castro in early 1959 because of the Cuban Revolution. We had to flee. It was survival to leave the country at the time and my parents relocated to Miami. We were fortunate for that. We’re fortunate to have left alive, fortunate to have resettled in what is without question the greatest country on the planet. I was not born here. I was born in Havana and I emigrated as a Cuban refugee just before I was 4 years old with my parents. `What consumes your day outside of the office? My wife and I walk. We like to boat, so those are the two things. In our summers we live at Saugatuck, and it’s a great place to live. We’d live there year-round, but it’s a little too cold in the winter.

`Can you give thumbnail sketch of coming here and what your

Albert Berriz, CEO and managing member, McKinley Inc.

Laura P car e o

Rep n s Sa es Manage Phone (732) 723 0569 Fax (888) 299 2205 Ema p ca e o@c a n com

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18 | CRAIN’S DETROIT BUSINESS | FEBRUARY 22, 2021 Laura Picariello

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icant comorbid behavioral health and physical health conditions, individuals who are served by 46 Community Mental Health Service ProvidDenn s Mouras s ers and 10 reCEO o gional Prepaid Un edHea hcare Inpatient Commun y P an Health Plans. o M ch gan All our care management programs include a focus on integrating physical and behavioral health with Community Mental Health Service Providers and other behavioral health providers. Michigan’s nationally recognized public mental health system is critical to providing community-based care to individuals with serious mental illness and substance use disorders. While we continue to support efforts to strengthen the current system and better coordinate care, the longstanding bifurcated structure in Michigan whereby Medicaid enrollees receive physical health benefits and care management from MHPs like ours, and their behavioral health benefits and case management from another entity will never fully address the significant overlap between physical and behavioral health. We know from our national experience serving approximately 6.4 million members across 31 states and the District of Columbia that a fully integrated system is effective in providing truly innovative, whole person-cen-

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“The who e goa here s ha hose connec ons … crea e re a onsh ps wh ch dr ves co abora on wh ch dr ves nves men and emp oymen ” E o o d Cra n s n an n erv ew a e as year Bu he ha on rave s com ng o an end as he ra e o COV D-19 cases wor dw de has subs ded n ac M BA CEO Sco H pakka rave ed o he Un ed Arab Em ra es o represen he s a e and ake par n he n erna ona De ense Exh b on and Con erence ha akes p ace h s week The con erence says has s r c COV D-19 proec on pro oco s n p ace nc ud ng manda ory PCR es ng or a endees “We ve con nued o move orward You know ke everyone e se we ve adap ed o he pandem c” E o sa d “And we ve con nued o push orward” The srae c y o Te Av v has emerged as a g oba s ar up echno ogy hub n recen years and has proven a rac ve or nves ors ke Adam F nke a par ner a B oomfie d H s-based Orfin Ven ures a am y office w h severa ech s ar up nves men s and many n srae compan es Among hose nves men s was O onomo an srae company ha co ec s da a or connec ed veh c es and wen pub c ear er h s year a a va ua on o $1 4 b on accord ng o a repor n TechCrunch The dea o ake O onomo pub c was done v a a spec a purpose acqu s on company or SPAC n wh ch nves ors be on a she company o merge w h an ex s ng firm and

tered and well-coordinated systems of care for all individuals. According to the Substance Abuse and Mental Health Services Administration, “integrated care produces the best outcomes and is the most effective approach to caring for people with complex health care needs.” Increasingly states are recognizing this by including behavioral health benefits in contracts with managed care organizations. Currently 31 states have integrated behavioral health financing arrangements. For instance, since Tennessee implemented care integration in 2008, UnitedHealthcare and MHPs have helped the state improve quality of care and reduce the potential for duplication of services and cost shifting between programs. The state reported a significant reduction in its Medicaid cost trend (from 13.5 percent in 2010 to 4.5 percent in 2016). Michigan should consider bolstering the current public system while simultaneously moving down the pathway toward a truly integrated system of care, as states like Tennessee have done. In doing so, MHPs can accelerate innovation and customization at the local delivery system and ensure services are easier to access, more consistent across the state, simpler to navigate, and better coordinated for all Michiganders. By supporting physical and behavioral health integration at all levels of the Medicaid program — including benefit design, service delivery, and administrative structure — Michigan can achieve its vision for whole-person integrated care. ake ha company pub c F nke a Cra n s 2018 40 under 40 honoree od Cra n s ha he expec s more compan es rom srae o ook o me ro De ro or he r F nke U S opera ons “De ro s an exce en marke or an srae company o be based n order o go a er he au omo ve manu ac urng and (financ a echno ogy) opporun es on he ground here” F nke sa d “There s no be er marke w h n he au omo ve space o be based” srae s ands as M ch gan s 22nd arges expor marke as o 2020 w h $223 m on n M ch gan goods headng o he coun ry accord ng o U S Census da a The s a e mpor ed abou $265 8 m on o srae goods n 2019 As he pandem c hope u y w nds down Romeo w h Guardknox sa d he expec s o see more connec ons beween srae and M ch gan bus nesses par cu ar y w h n he connec ed and au onomous veh c e space and w h Europe mp emen ng new regu aons “Th ngs are s ar ng o hea up” sa d Romeo add ng ha many srae cybersecur y compan es are n a pos on o he p Amer can manu ac urers ge up o speed w h regu a ons eadng o more connec on be ween he wo reg ons “ see on y as ncreas ng o be hones w h you” Con ac nmanes@cra n com (313) 446 1626 @n ckrmanes

entities, from the city of Detroit and the Southeast Michigan Council of Governments to the Michigan Department of Natural Resources and the U.S. Environmental Protection Agency, Borucki said. “We’re trying to get their buy-in to make sure there’s nothing in our plan that is out of line with other green infrastructure (plans),” she said. Steps to identify open spaces where anchor institutions and small arts groups and local artists will be able to host programming are underway. CRAIN’S DETROIT BUSINESS And Midtown is talking with institutions about ways to open up their buildings by reimagining how cafes and museum gallery stores open up to the outdoors. “That’s going to be a really slow process. Not only do you have to get all of the leadership to buy in, you have to get all the board members to buy in,” Borucki said. “Some are more interested than others.”

February 22, 2021

Public outdoor Wi-Fi going in throughout Dewtroit’s developing cultural district is expected to draw more people and push more outdoor digital programming, such as this installation at the Detroit Historical Museum during Dlectricity in 2014. | DETROIT HISTORICAL SOCIETY

CENTER

From Page 3

While the near-term initiative is focused on digital to help bring cultural programs to the district’s outdoor spaces, “the larger plan will take place with all kinds of art,” Executive Director Susan Mosey said. Increased outdoor programming will enable the cultural institutions to welcome more patrons amid continued uncertainty about when they’ll be permitted to safely reopen their doors without capacity limits, but it’s also “a good, long-term strategy for the district,” Mosey said.

Connecting this summer By late summer, public Wi-Fi is expected to be available throughout the cultural district, which is bounded by Brush Street to the east, Kirby to the north, Cass Avenue to the west and Warren Avenue to the south. The Detroit Historical Museum at Woodward Avenue and Kirby Street will be the first institution in the district to see outdoor Wi-Fi, given its close proximity to the WSU building right next door. WSU has extensive fiber and network infrastructure throughout the Midtown area that intersects with its campus, including partnership agreements with Merit Network Inc., a nonprofit statewide provider to educational and nonprofit organizations, said Rob Thompson, interim chief information officer and associate vice president for computing and information technology. “Community residents and guests will have free access to public Wi-Fi during their visits to Cultural Center sites. Additionally, Wayne State students, faculty, and staff will have expanded, secure and seamless access to Wayne State services through their university Wi-Fi credentials while traveling between the Cultural Center sites and our campus,” he said. “This project aligns with our mission, and we are very excited to be a part of making it a reality,” he said. The Detroit Historical Museum is trying to do more programs on its outdoor Legends Plaza, so it’s a good early candidate to get Wi-Fi, Borucki said. Though the museum has Wi-Fi inside, it does not extend onto its Legend Plaza. Outdoor Wi-Fi at the museum will launch this spring, said Elana

Mosey

Rugh

Rugh, president and CEO of the Detroit Historical Society, the nonprofit that operates the museum. “Having districtwide Wi-Fi will bring more people to the district, and having it will allow us to be much more creative in the programming we bring to the community,” she said. The museum had already started to utilize Legends Plaza more in the last couple of years through events like the Techno Tuesdays series of food truck lunches and live music on Tuesdays during the summer. “We intend to increase the amount of usable space on our plaza and my team is already working to plan experiences that will engage people outdoors and hopefully lead them to want to discover more of Detroit’s stories inside of the museum,” Rugh said. The museum will host the lunchtime Techno again this summer, and it’s considering bringing its popular Motown Karaoke event onto the plaza for the first time this spring, she said. “Of course, we are active participants in the ... Dlectricity event and will now be able to play a larger role in that with outdoor Wi-Fi.” The extended Wi-Fi capability is the first of many steps the museum —

“WE INTEND TO INCREASE THE AMOUNT OF USABLE SPACE ON OUR PLAZA AND MY TEAM IS ALREADY WORKING TO PLAN EXPERIENCES THAT WILL ENGAGE PEOPLE OUTDOORS AND HOPEFULLY LEAD THEM TO WANT TO DISCOVER MORE OF DETROIT’S STORIES INSIDE OF THE MUSEUM.” — Elana Rugh, president and CEO of the Detroit Historical Society

which is celebrating its centennial this year — plans to enhance its activation of its outdoor spaces, Rugh said. It’s also considering reopening its grand Woodward-facing entrance, which has been closed for decades. And as part of interior space reconfiguration, it’s planning to put in a new grab and go café and larger gift shop that will be easily accessible to the plaza for passersby. “I am really looking forward to partnering with the other members of the district in joint planning of new programs and events as we all are hoping to fully activate new shared spaces as we move forward with the plans for the district,” Rugh said. The Michigan Science Center is contemplating new strategies to take advantage of the cultural district WiFi, President and CEO Christian Greer said. But they are likely to be a way to augment the plans it already has for this year rather than being something new developed specifically for a digital outdoor platform, given the lack of staffing and expertise that can be assigned to the effort. But the science center does have pending grant requests and partnerships in the works that could change that, he said. Mosey expects other programs to take shape as the Wi-Fi network is expanded and pass-through grants to fund digital outdoor programming are made to the cultural institutions. For its part, Midtown is planning to relaunch Dlectricity, an outdoor visual light and art festival, this September, within the cultural center footprint.

Moving pieces Though slowed by the pandemic, planning efforts continued to move forward on many fronts, Borucki said. In addition to the Wilson and Knight foundations, funders supporting planning for the district include: William Davidson Foundation, Milford-based Walters Family Foundation, Kresge Foundation, Hudson-Webber Foundation, Fred A. and Barbara M. Erb Family Foundation and the Community Foundation for Southeast Michigan. They’ve contributed a total of nearly $3.68 million to planning efforts, Mosey said. Conversations to finalize landscaping plans are underway, with Midtown working to secure needed approvals and buy-in from public

Midtown is also finalizing a request for proposals process for a marketing, communications or advertising firm to create a brand and new website for the Cultural District. It hopes to issue the RFP in March and have a brand identity and new website in place by fall, she said. At the same time, Midtown and the anchor institutions are starting to discuss how the district will be governed and administered. A governing organization, which could be set up as a nonprofit, would have oversight of a number of things, she said, including: public space maintenance, programming of public spaces and oversight of the Wi-Fi for the district. “That’s what we’re trying to figure out: What is the governing entity for the district? What does that organization look like and ... how would it be funded?” Borucki said. Contact: swelch@crain.com; (313) 446-1694; @SherriWelch

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FEBRUARY 22, 2021 | CRAIN’S DETROIT BUSINESS | 19

FAILING

From Page 1

The record of nearby public universities doesn’t fare much better — just 8 percent at Kent State and nearly 15 percent at Cleveland State in 2018. The story is similar In Detroit, where nearly 80 percent of its residents are Black, but Black students made up just 15 percent of Wayne State University’s population three years ago and just 11 percent at the University of Detroit Mercy. Roughly a third of Chicago’s residents are Black, but Black students made up just 6.9 percent of Loyola University Chicago’s population that same year. Students at selective institutions have higher chances of graduating. Those campuses also reportedly spend about three times more per student on instructional and academic support compared with open-access schools, the institutions where students of color enroll at much bigger rates. Those places, including community colleges, historically receive less funding and have fewer resources. But Black students are overrepresented at for-profit colleges — where the rates of debt tend to run high and the graduation rates tend to skew low — by more than 12 percentage points in Ohio and more than 15 percentage points in Michigan, according to one recent estimate. And some of the most problematic outcomes are linked to students at those institutions. Many have a long history of predatory practices. Students there tend to graduate with more debt and are more likely to go into default than their peers who enroll elsewhere. What this all adds up to is stubborn gaps in who’s getting a degree. In each of the counties that house Chicago, Cleveland and Detroit, the rates of white people with bachelor’s degrees are more than double the number of Black

YOUNG

From Page 3

So far, she’s spent about $11,000 on inventory and $6,000 on renovations and estimates she’ll spend about $20,000 on upgrades. Detroit Flower Co., which saw revenue of close to $120,000 in the last quarter of 2020, is not Hampton’s first business venture. She’s also a personal trainer and previously co-owned Detroit Juice Bar, which was inside the nowclosed Crossfit Detroit. That experience, Hampton said, prepared her to branch out on her own. Now she employs three floral designers, two delivery drivers and an assistant. Hampton relies on Twitter and Instagram to advertise her business. “I’ve seen a lot of businesses fail — for whatever reason,” said Hampton, who has pulled in more than $30,000 in revenue so far this year. But she said the pandemic has not hurt her business “because everybody always wants flowers.” The future is bright for the young entrepreneur, but she’s trying not to get too big too fast. “There are a lot of things I’d love to do now that I have my own shop, but I’m not in a huge rush,” Hampton said. “It shows when you rush into things. If you can see it, customers can see it.”

What’s old is new Jordan Werthmann didn’t rush into opening a brick-and-mortar location for his sneakers and vintage clothing shop, Former Vintage. Prior to opening the doors in July 2016, he made most of his sales via Instagram. It was when he saw what started as a passion project could turn into a profitable business that the Royal Oak resident opened his first store with $4,000 of his own money. Werthmann, 24, now runs one of the more popular such shops in metro Detroit, specializing in buying and selling new, used and retro sneakers as well as vintage clothing and streetwear. Werthmann, whose website went live Feb. 5 and who also uses social media as his main form of advertising, has seen revenues increase each year. The store, which has been operating at 1301 Broadway St. in Detroit while his Royal Oak location undergoes renovation, broke even 20 | CRAIN’S DETROIT BUSINESS | FEBRUARY 22, 2021

“WHEN THEY LOOK AT THE TEST SCORES OF OUR AVERAGE STUDENTS, THEY DON’T SEE SUCCESS. THEY DON’T EVEN GIVE THEM A CHANCE TO COME AND TRY AND GROW AS A STUDENT.” — Jowan Smith, fonder of Getting Our Babies to College 101

Americans with those same credentials. “These systems were created to keep people of color out, so I think we have to shift our paradigm,” said Ryan Fewins-Bliss, the executive director of the Michigan College Access Network. “We think about it as like the system is failing, when actually the system is really, really successful because it was designed to keep these people out. And it’s keeping them out.” He added, “We have to do systems-level change at the K-12 level and definitely at the higher ed level in order to see these problems be fixed.” These stark enrollment and attainment gaps have far-reaching impacts. Earning a bachelor’s degree, of course, affects one’s personal earning potential, but research also shows having higher levels of education creates healthier and more engaged citizens. “Education in the African American community changes generations,” said Laura Williams, president of the Cleveland Council of Black Colleges Alumni Association. “It is a game changer for individuals. It is a game changer for families.” It’s also vital for the economic health of a region. A 2015 report from The Brookings Institution found that a bachelor’s degree holder contributed more than $278,000 in lifetime direct

spending to a local economy compared with an average high school graduate. And those economies are changing, placing more emphasis on earning higher credentials. By 2050, the bulk of residents in Chicago are forecast to be people of color. There are expected to be fewer jobs in manufacturing and transportation, but increased opportunities in industries such as finance, real estate and other professional/technical services. Michigan is pushing for 60 percent of its residents to have a postsecondary credential by 2030. Sixty-five percent of Ohioians are expected to need either a two- or four-year degree or “marketable skill” by 2025. In Cleveland, high school senior Nia Babley is researching colleges right now. She plans to major in biomedical engineering, a sector that’s expected to see growth over the next few years. She’s looking at the demographic makeup of each campus on her short list. “I want to understand the college and I want the college to understand me, all at the same time,” she said. She’s also pushing for a full ride. Higher education is expensive. A 2019 report from The Century Foundation, a progressive think tank, reinforced a link between student debt and the racial wealth gap, finding that Black families “rely more heavily on student debt, and on riskier forms of student debt, than white families do.” Black Americans who take on student loans are also more likely to “never” be able to repay that debt, according to a 2020 report from the JP Morgan Chase Institute. Those findings noted that this is due in part to Black borrowers making about 22 percent less than their white counterparts, as well as being less likely to receive financial help from family members or friends to pay for their education. Overall, Babley said she feels lucky to attend a high school with a strong college-going cul-

ILLUSTRATION BY ANDREA LEVY FOR CRAIN’S

last year despite being closed for extended periods due to the COVID-19 pandemic. Werthmann, who is researching opening another store in Los Angeles, did not apply for any Paycheck Protection Program funding. “Last year was the most creative year I’ve ever had. During the closure, we had to be creative to find a way to make money,” said Werthmann, who works with three friends he refuses to call employees. “When we were able to reopen, we couldn’t let everybody in the store. We had about 30 people in line every day. We had to learn how to handle things differently. “By posting things on Instagram, and only there, that gets people to come right into the shop to either pick up what they were looking for and to see what else we have to offer.”

Highs and lows Hampton and Werthmann have dealt with the ups and downs of the life of a young small business owner and take pride in having established their brands on their own. Both used their own money to finance their ventures, which is typical of most small businesses, according to the Small Business Association. Hampton drew from her experience with Thrifty Florist when it came time to finance her business. At Thrifty, Hampton learned the cost of flowers isn’t very high. The $200 with which she started Detroit Flower Co. went to stickers and business cards. Werthmann said he didn’t seek any loans simply because he “doesn’t like to owe anybody for anything.” In fact, at least 81 percent of entrepreneurs do not access a bank loan or venture capital, according to the Kauffman Foundation. Neither Hampton or Werthmann attended college or took business courses before starting their businesses. Werthmann admits he wasn’t the strongest student in high school, exhibited by his 1.8 grade-point average. That made serving as his own accountant, handling bills and payroll difficult. Lack of experience with finance cost him money in the early stages, he said. “I knew I had to put more of a focus into learning the technical aspects of owning a business,” Werthmann said. “All I really know how to do is buy and sell sneakers and pick out cool

Former Vintage owner Jordan Werthmann (left) poses with Detroit Lions running back Adrian Peterson during a visit to Werthmann’s store. | FORMER VINTAGE VIA INSTAGRAM

vintage pieces. I’ve had to learn there’s a lot more to owning a business than that. Making sure bills get paid on time, things like that, I had to put that at the forefront for a while. “Having to learn how to run sales tax, do payroll and things like that, that was tough, I’m still learning things someone who took some business classes in college would already know.” Werthmann said he made some bookkeeping mistakes early on. He also admits he didn’t put his all into the business at first, instead opting to focus on things most 19-year-olds do. “It was a lot of trial and error,” the Former Vintage owner said. “When you’re young and trying to run a business on your own, you get turned in so many directions that sometimes things just slip your mind or you forget what you were supposed to pay on one bill and pay that on another. Just having things in order, having a system and setting aside time for bills, inventory, things like that. That’s important.” Hampton works with a banker at Chase, but handles all money coming in from orders. The florist primarily works through Paypal and

Owner Ja’Nye Hampton, 22, prepares flowers at Detroit Flower Company. Hampton started the company in 2018 and has been able to pursue the business full time since July 2020. | NIC ANTAYA FOR CRAIN’S

Cashapp. That gave her some headaches during the holiday season. “My website wouldn’t allow me to take (credit card) payments because the state was going through its mail crisis,” Hampton said. “I was only able to take payments through Paypal. In December and January, I lost out on a ton of money.” Purchases were made via her website, but Hampton could not touch the funds made from the sales because of an expired ID, which is needed to withdraw funds. Hampton said $30,000 from web sales sat idle for two months until she

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Bamboo Detroit co-founder Amanda Lewan established her coworking business in 2013 as a 26-year-old. | CONTRIBUTED

MORE LESSONS LEARNED Start at home: Depending on your financing and where you would like to open a brick-andmortar location, you may not have the funds to do so at the outset. Inventory can be stored at your home. Items can be displayed on a website or via social media. You can also offer delivery service and shipping. Be patient: Small businesses typically take two to three years to turn a profit, so consider taking a smaller salary in the early stages. Have fun: Aside from having what they believe is a great idea, small business owners typically go the entrepreneur route out of passion.

received a new ID. She took the credit card issue as a lesson to always be prepared in advance, making sure all bookkeeping is in order. Hampton said she’s recently looked into working with programs such as Techtown Detroit and Motor City Match, both of which provide resources to small business owners, along with seeking grants because she believes she’ll need to grow the business again sooner than later. She will need warehouse space soon, and is already pondering moving into a larger retail space. “It took me a while before I realized I could turn this into something,” the Detroit Flower Co. owner said. “I’ve never taken a business class. That’s not something I’ve ever been interested in. With this business, though, you learn quickly how to manage money and time because if you don’t, that can hurt you.” Hampton has put in a lot of effort to get to where she is. While working out of her apartment, Hampton said she got a bit overwhelmed. She would sleep on her couch and use her bedroom to store inventory. Watering the plants on a schedule proved challenging as did ensuring the flowers were kept at the correct temperature.

ture. She feels supported. But she knows that not all students have that experience. For those who don’t, Cleveland resident Jowan Smith helps families fill in the gaps through her grassroots group Getting Our Babies to College 101. She said she finds that many institutions, especially the top ones, seem to have requirements in place that can diminish Black students’ applications from the beginning. High school students might not be able to fulfill community service hours because they’re working, or they may be at a lower-performing high school without resources. Research shows students of color have fewer opportunities for advanced classes or gifted programs. “When they look at the test scores of our average students, they don’t see success,” Smith said. “They don’t even give them a chance to come and try and grow as a student.” According to The Education Trust’s Wil Del Pilar, if institutions’ admissions offices are placing a higher priority on opportunities that Black students have less access to, they’re systematically disadvantaging them. “That is why students end up at community college or for-profit institutions, because we’ve effectively shut the doors to our best and best-funded institutions to the majority of those students,” the vice president of higher education at the national nonprofit educational advocacy group said. Black students, along with Hispanic students, are reportedly three times more likely than their white peers to enroll at a for-profit college. A Bryant and Stratton outpost in Cleveland, a barber college 30 minutes outside of Chicago and a beauty school in Detroit each reported Black people made up at least 80 percent of their total enrollment in 2018. “I think they reach a population that feels like they cannot access college, that college isn’t for them, by telling them this is different, this is bet-

ter, this is newer,” said Fewins-Bliss in Michigan. And while not all jobs require a four-year degree, MCAN’s Fewins-Bliss said that some credentials issued by for-profits aren’t actually industry recognized. “It’s not stackable, so you can’t take it to the institution down the road and stack credits on top of that to get an associate degree or a bachelor’s degree,” he said. “So students get done and they’ve paid $30,000 for a two-year certificate that doesn’t get them anywhere.” When it comes to closing the overall gaps, some work is being done on these fronts. College scholarship opportunities linked to cities’ K-12 systems have been established, including Cleveland’s Say Yes to Education, the Detroit Promise and the STAR scholarship in Chicago. Wayne State University in Detroit touted an uptick in enrollment for first-time Black college students this past fall. The University of Chicago, which didn’t respond to interview requests for this story, reported that the freshman class of 2024 is the “most diverse student body and freshman class” in its history, according to the university’s independent student newspaper. The publication added the university has used similar language to describe other classes before. But for sustainable progress to be made, Ed Trust’s Del Pilar recommends more accountability fall on states and cities, along with giving more thought to funding formulas. “Truthfully, the way we should be funding these institutions should be flipped,” he said. “We provide the most resources in higher education to the students with the most advantage, and we provide the least resources in higher education for those students who are most disadvantaged.”

“It got to a point where I thought about getting one of the big (commercial) refrigerators to put in my apartment, but that DTE bill would’ve killed me,” Hampton said. “I made it work out of my apartment, but having a retail space can hopefully put the business at another level.” Now she’s paying $1,500 a month on the twoyear lease for her floral shop. She was able to negotiate that down from $2,700 a month after the property owner realized how much foot traffic a flower shop would generate, Hampton said.

avenues for people with flexibility to take something they had been doing on the side and make it more substantial without taking away time from what they may have been doing to pay the bills,” Calley said. “The relative risk proposition is lower now. Many people are working with more flexibility than they’ve had previously with being able to work remotely, and that’s even prior to the pandemic. People, of all ages, now have more of an opportunity to pursue entrepreneurial aspirations.”

‘Something to call their own’

It’s all worth it

In 2019, 15.9 percent of small business owners in the U.S. were younger than 35, according to the Small Business Association. But the rate of new entrepreneurs was lowest among those aged 20–34 (0.23 percent), according to a Kauffman Foundation report that measured activity from 1996-2018. Amanda Lewan, co-founder and CEO of Bamboo Detroit, fits into that demographic. The graduate of Michigan State University started the coworking space business at 25 years old after a one-year stint with an advertising agency. Lewan was living at her parents’ home at the time, and said her mother was confused to see her spending hours on a laptop working to get her business off the ground. Lewan, a Crain’s 2017 Twenty in Their 20s honoree, believes a stigma attached to young people taking an unconventional route is no more. “I feel like it’s more culturally acceptable now for people in that demographic to start a business,” said Lewan, whose company now generates nearly $80 million in revenue annually. “I grew up in a lower-class, ‘work one job until you retire’ culture. That’s partially tied to economic conditions, I know, but there is now a diverse group of people under 30, under 25 now starting their own businesses. People are attracted to having something to call their own and having a more flexible work style.” Brian Calley, president and CEO of the Small Business Association of Michigan, said he’s seen a “tremendous amount” of new business employer ID filings. While startup companies, like Hampton’s, don’t usually join groups like SBAM due to a lack of finances or time, Calley in his research believes the number of new business owners includes younger entrepreneurs. “People are going for it. Particularly during the pandemic, remote work has created more

Both small business owners realize the risk incurred in starting a business. Lewan believes that risk is well worth it. “You’re learning on your own dime,” Lewan said. “There’s a slower learning curve. As you pick things up, you accelerate that learning curve. In places like (Silicon) Valley, they’re used to younger business owners. In the Midwest, it feels like people want to see you grow your portfolio before owning your own business.” While capital is key when starting a business, Lewan said she has witnessed entrepreneurs with little funds hustle to make their dream a reality. “It may take a couple of years to get the venture capital, but people go after it,” Lewan said. “It is a big barrier when you’re younger. You might not have credit built up, you might not understand credit and debt. Oftentimes you have to invest your own capital to get people to believe in you and then they’ll invest, too.” It’s hard work, but it’s rewarding, Werthmann said. It gives him a chance to serve as somewhat of a mentor for others, too. “I’m around a lot of creative people who want to have their own business,” he said. “If you work hard every day, you can do it. If you don’t think about failing, it usually works out.” Hampton is a big proponent of betting on yourself. “I don’t know if people think this company blew up overnight. I had seven jobs when the pandemic hit,” the florist said. “People have to bet on themselves. I think everybody should do what they love. A lot of people do what’s comfortable. The best thing I ever did was make myself uncomfortable by starting this business.”

Amy Morona covers higher education for Crain’s Cleveland Business, a sister publication of Crain’s Detroit Business.

Contact: jason.davis@crain.com (313) 446-1612; @JayDavis_1981 FEBRUARY 22, 2021 | CRAIN’S DETROIT BUSINESS | 21

THE CONVERSATION

Ferndale chamber director talks post-pandemic growth, partnership FERNDALE AREA CHAMBER OF COMMERCE: Executive Director Joy Wells has kept busy during the pandemic. Over the past year, Wells has showcased her passion for public service, helping establish the first strategic collaboration in the area to include various downtown development authorities, departments of community and economic development and the chamber as joint services on emergency business response at the start of the COVID-19 pandemic. The groups together assisted businesses with resources in navigating the shutdown and reopening. Wells, a Macomb Township resident who took her post in February 2019 after 15 years working in operations and project management, is focused on bringing back the vibrancy that makes the communities she covers, which include Ferndale, Oak Park and Hazel Park, popular. | BY JASON DAVIS ` You’re in a position that calls for a lot of being out and about, among people. What’s the last year been like for you? So, I’ve been working remotely like everyone else. All of the (City Council) meetings have been held virtually. Over the last six months, since the first stay-at-home order was lifted, I’ve been in kind of a hybrid “some things in person, some virtual” space. I really don’t do a lot of site visits with the developers. Where I come in is for the groundbreaking or grand opening. ` Tell me how the pandemic has changed the business landscape in the communities the Ferndale Area Chamber of Commerce encompasses So, every business and industry has been impacted to varying degrees. All of them have been forced to adapt to changing circumstances. I think the biggest issue for everyone is just general uncertainty. It affects daily routines and long-term planning. That’s definitely not a way to create success for a business. ` With Ferndale specifically, how has the pandemic affected what is known as such a vibrant city? One of the great things people love about Ferndale is its sense of community. That’s a vital component of people’s lives. We’ve had large gatherings like the (Woodward) Dream Cruise canceled, but even more important is that people have had to stop visiting family and friends. That directly contributes to the vibrancy (of the city). What makes Ferndale what it is, it’s still there. Our focus is going to be reintroducing the sense of vibrancy that makes Ferndale such a great place.

` Are you seeing new businesses ready to take over the vacant storefronts? Actually, there are still a lot of zoning requests that are going around, a lot of licenses being issued. I do have a pretty good list of some new or relocated businesses moving into the vicinity. There are going to be new businesses in all the communities. They’ve definitely been picking up. They never completely halted. (City personnel) has been tremendous at assisting business owners who wanted to proceed during the pandemic — safely, of course. ` In Ferndale specifically, a number of new businesses (vegan comfort food restaurant Spacecat V Stro and Tai/Vietnamese/Chinese restaurant Got Pho among others) have opened. Are you surprised by that? I’m not. Ferndale is known for having unique food options. Their timing was tremendous. They’re doing well, all things considered. They bring new, unique offerings to the community, and the residents like that. ` What types of new businesses are doing well? Any business that’s able to keep its doors open is a testament to the tenacity of the business owner. It also makes us heartsick for those who are not able to open, whether the 25 percent capacity isn’t viable or for some other reason. Nightlife has taken a hit. Boogie Fever has been closed since (March). The owners are still holding the space. It’d be a big detriment if we lost places like that. ` Can you go into more detail about the nightlife?

There’s lots of uncertainty there. Boogie Fever is an exceptional circumstance because it doesn’t fall into a space that makes it eligible for some of the loans restaurants have been getting. The PPP loans aren’t applicable if they’re not able to open their doors. Boogie Fever’s issues aren’t unique. Similar circumstances exist everywhere. The county has done a good job of stabilizing businesses. There are just some venues that don’t qualify for funds, then some grants are first-come, first-serve and they miss out. Some are holding on. There’s so much uncertainty because there isn’t a definitive end. We just don’t know. I expect the 25 percent capacity threshold to be around for a while. We’re just now starting forward momentum with the vaccines. I equate this to a slow turn of a faucet rather than a quick flick of a light switch.

put in place, that halted everything. That definitely changed the timeline (for the project). I’ll go back to that uncertainty. There continues to be interest in occupying the space, but I’m not at liberty to discuss details. It’s been a struggle for residents. Parking has always been a concern in the community. The initial development took up parking spaces the city couldn’t spare. Now that (the deck) is open, we’re able to relieve parking issues. I’m confident the development will be occupied. The community will be excited about what goes into it.

Joy Wells executive director Ferndale Area Chamber of Commerce

REPORTERS

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Dlectricity festival coming back to Detroit this fall MIDTOWN DETROIT INC. IS bringing the Dlectricity event back to the city this fall. The visual light and art festival will take place in September, marking the first time the event has been held in the city since 2017. Exact dates for the festival have not yet been announced. The event includes installations featuring video art, 3D video mapping, lasers and interactive design and engineering, showcasing the works of internationally acclaimed and emerging artists from Detroit and around the world. A total of 250,000 visitors attended the event in 2017, according to the Dlectricity website. About 3,000 people participated in the four-mile Light Bike Parade as part of the festival.

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Apetechnology, “The Shadows of Stendrotron” at the foot of the Detroit Iinstitute of Arts’ back staircase at Dlectricity 2017. | DLECTRICITY

The footprint for this year’s event is expected to shrink slightly to align with the footprint for the developing cultural district, a 10-block area around 12 cultural institutions in Detroit’s Midtown neighborhood, to provide more control for public health and safety reasons, said An-

22 | CRAIN’S DETROIT BUSINESS | FEBRUARY 22, 2021

nmarie Borucki, director of arts and culture for Midtown Detroit. The cultural district is bounded by Brush Street to the east, Kirby Street to the north, Cass Avenue to the west and Warren Avenue to the south. Dlectricity was conceived as a biennial event, Borucki said. But the

festival has happened sporadically since it began in 2012. The 2021 festival will also include installations at DTE Beacon Park, per the event’s website. A curatorial committee with representation from Midtown, cultural institution and digital design leaders is selecting the artists and projects that will be placed on the facades, grounds and surrounding buildings of the anchor institutions in Midtown, including: ` College for Creative Studies ` Charles H. Wright Museum of African American History ` Detroit Historical Museum ` Detroit Institute of Arts ` Detroit Public Library ` Michigan Science Center ` MOCAD ` Wayne State University

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3:30 p.m. | March 10 Join us as we dive into the nuances of the state’s largest mergers and acquisitions in a year like no other. Hear from Mina Sooch, the veteran biotech entrepreneur who led a reverse merger for her Ocuphire Pharma last year. The deal was one of several involving reverse mergers or SPACs during 2020. Learn from Lineage Logistics CEO Greg Lehmkuhl, who led his company through an aggressive growth strategy that included more than 50 acquisitions over the past five years. Also: M&A advisors Raj Kothari, Managing Director of Cascade Partners LLC and Laura Marcero, Managing Director of Huron Consulting Group, offer an outlook of the activity forecast for this coming year. FEATURING A LIVE Q&A WITH PANELISTS

Dustin Walsh

Senior reporter Crain’s Detroit Business

Greg Lehmkuhl CEO Lineage Logistics

Rajesh U. Kothari, CFA Managing Director Cascade Partners LLC

Laura Marcero

Managing Director, Huron Consulting Group

Mina Sooch

CEO and Founder, Ocuphire Pharma Founder and General Partner, Apjohn Ventures Fund

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