Crain's Detroit Business, June 13, 2016 issue

Page 1

Molly Maid President Meg Roberts opted for an app. Here’s what she learned, Page 19 JUNE 13-19, 2016

Holtzman moves on after break

Ex-Village Green CEO takes buyout, leads new development company

Blue water sparkles St. Clair County is known for blue water, boat races and an economy that has lagged that of its metro Detroit neighbors. That’s changing. A spate of recent projects, totaling $234 million, has officials touting a new day. New developments include the transformation of the site of the former Thomas Edison Inn into a DoubleTree by Hilton, a new $9 million convention center and an enhanced riverwalk. A renaissance in beer and wine is drawing in new tourists. For more, see our Crain’s Michigan Business report that begins on Page 9.

By Kirk Pinho kpinho@crain.com

Jonathan Holtzman is widely considered to have one of the most brilliant minds in multifamily real estate, not only locally but nationally. But his temper is also the stuff of legend. Now he is almost certainly tens of millions of dollars richer and off in a different direction with a new development company, City Club Apartments LLC, with a Canadian investor, Alan Greenberg, Holtzman: Cites after agreeing to a buyout “differing strategic with a former business objectives and partner, Compatriot Capivisions” as reason tal out of Dallas. for split. The deal, finalized June 3, marks the first time Holtzman, former CEO of Farmington Hillsbased multifamily real estate giant Village Green Cos., will not be involved in the company’s dayto-day management and operations since he started buying out former owners’ interests starting in the mid-1980s, nearly seven decades after the Holtzman family first got involved in Detroit real estate. And some at Village Green might be breathing a little easier because of that.

PHOTO BY MARK RUMMEL

SEE HOLTZMAN, PAGE 27

Oakland Hills’ famed South Course could shutter for a 14-month restoration By Bill Shea bshea@crain.com

The members at storied Oakland Hills Country Club in Bloomfield Township will vote later this month on a proposed restoration of the legendary South Course that would close it for 14 months beginning in March 2018. Up to $11 million, generated from an increase in member dues, would be spent to restore the course

to its pre-World War II state and make it much more like the original links created by famed golf course architect Donald Ross, who designed the South Course. It opened in July 1918, and would go on to establish itself as one of the most notable courses in all of golf. Under the proposed plan, which several Oakland Hills members shared anonymously with Crain’s, the South Course’s fairways would

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be widened, bunkers redone, greens restored to their original configuration and resodded by deeper-root bentgrass. A number of trees also may be removed. “It will look a lot more like Donald Ross’ original vision and probably what the membership played for the first 20-30 years after the club opened,” said OHCC President Tim Hildebrand, a member since 1986. “The topography reminded (Ross) of an inland links course he had seen in Scotland.” The Scottish-born Ross, who designed more than a dozen courses in Michigan and more than 400 nationally from 1900-48, famously said of Oakland Hills upon first visiting the site in 1916: “The Lord intended this for a golf course.” The proposed restoration would undo some of the work done in 2006-07 by golf architect Rees Jones

Oakland Hills Country Club major tournaments 1922 Western Open

1996 U.S. Open

1924 U.S. Open

2002 U.S. Amateur

1929 U.S. Women’s Amateur

2004 Ryder Cup

1937 U.S. Open

2008 PGA Championship

1951 U.S. Open

2016 U.S. Amateur

1961 U.S. Open 1972 PGA Championship 1979 PGA Championship 1981 U.S. Senior Open 1985 U.S. Open 1991 U.S. Senior Open

aimed at boosting the South Course’s difficulty prior to the 2008 U.S. Open at Oakland Hills. It also will reverse some of the renovations done by Jones’ father, Robert Trent Jones, who remodeled it before the

1951 U.S. Open. Oakland Hills itself in recent years has widened some fairways to improve playability for club members, but the full restoration would SEE GOLF, PAGE 28

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MICHIGAN

BRIEFS Dow Chemical, DuPont to vote July 20 on merger

Dow Chemical Co. and DuPont Co. said Friday that they will hold separate shareholder meetings July 20 to vote on their merger, The Associated Press reported. Dow Chemical’s meeting will be at its Midland offices, and DuPont’s will take place at its Wilmington, Del., headquarters. The two agriculture and chemical companies in December announced plans to merge and then split the combined company into three separate publicly traded companies focused on agriculture, material science and specialty products. The deal is expected to close in the second half of this year.

Delta College is McDonald’s kind of place for class work Minding the grill could pay off for recent learners at McDonald’s Hamburger University. Managers in the fast-food chain soon will be able to use their online vocational classes to earn up to 10 credits at Delta College, thanks to a new partnership announced last week. Delta will

honor courses taken at Hamburger University as being equivalent to up to four of its business classes, and the credits can go toward an associate degree in business or general studies, MLive.com reported. Tony D’Anna, owner-operator of several McDonald’s restaurants in mid-Michigan who is spearheading the program, said the credit cash-in is available to any eligible managers in the state. A similar deal is already in place at Grand Rapids Community College; one is coming soon to Mott Community College.

Switch to save on taxes but reimburse township Nevada-based Switch may avoid $1.1 million in taxes every year when it moves its regional data management and storage center into the former Steelcase pyramid in Gaines Township near Grand Rapids, MLive.com reported. However, the company has agreed to reimburse Kent County and the township for all of the real estate taxes those communities will lose because of the tax exemptions the company will have on the invest-

ments they make in servers and other technical equipment. A Kent County finance committee gave the arrangement its blessing last week. The township board is expected to act in July. Gaines Township Supervisor Don Hilton Sr. said the agreement will allow the township to provide services to the facility, which has been vacant since 2011, without suffering tax losses. The “payment in lieu of taxes” by Switch was authorized by a bill passed by the state Legislature and signed by Gov. Rick Snyder last month. The bill addressed concerns that the tax breaks approved by the Legislature late last year could harm local communities.

MICH-CELLANEOUS n A retired general who is coordinating the effort to get the lead out of Flint water lines said plastic pipes are being studied for possible use in the city, Plastics News reported. Retired National Guard Brig. Gen. Michael McDaniel said last week that while copper lines have been specified in the current request for proposals, that may not always be the case. Plastics News, a sibling publication of Crain’s Detroit Business, earlier reported that the CEO of Los Angeles-based JM Eagle offered to donate enough free polyethylene pipe to replace all lead service lines going to homes and businesses. McDaniel said JM Eagle’s offer prompted his

request for a study of plastic pipe. n The Michigan Senate voted to rescind an annual tax break worth up to $80 million a year that was inadvertently given to auto insurers four years ago, AP reported. The move is part of a deal to enact the next state budget. Senators amended the legislation last week to ensure that companies still qualify for the credit for much of this tax year but lose it going forward. The bills return to the House for final passage. n Amway’s parent company has sold a $175 million cosmetics subsidiary to a Japanese buyer, the Grand Rapids Business Journal reported. Alticor said it signed an agreement with Shiseido Americas Corp. to sell 100 percent of the membership interests in Gurwitch Products, a Texas-based maker of “prestige” cosmetics and skin care brands.

n

Meritage Hospitality Group Inc.

says it will own 18 more Wendy’s restaurants by the end of summer, MLive.com reported. The Grand Rapids restaurant operator last week announced the purchase of eight Wendy’s restaurants and a deal to buy 10 more in the Oklahoma City area. The second acquisition is

INSIDE THIS ISSUE

CLASSIFIED ADS..............................25 DEALS & DETAILS............................24 KEITH CRAIN....................................... 6 MARY KRAMER .................................. 9 OPINION .............................................. 6 OTHER VOICES ................................... 7 PEOPLE ..............................................24 RUMBLINGS ......................................30 WEEK ON THE WEB .........................30

COMPANY INDEX: SEE PAGE 29 expected to be completed in late summer, the company said. The purchase price was not revealed. The deal marks the 15th acquisition in five years for the company. n Plans are afoot to build one of the country’s longest year-round canopy walks in Midland, MLive. com reported. The 1,100-foot walk will be built on the Dow Gardens Whiting Forest property, which consists of about 50 acres of native Michigan forest, meadows and wetlands with large elevation changes unusual for Midland County, the Herbert H. and Grace A. Dow Foundation said.

Correction n  The Power Metrics section of the Most Influential Women profile story on Laura Czelada, president and CEO of Delta Dental of Michigan, Ohio and Indiana, should have specified that revenue stated represented business in Michigan, Ohio and Indiana. The profile appeared on Page M38 of the June 6 edition.

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DPS looks to boost student numbers By Chad Halcom chalcom@crain.com

Educators don’t like to view children as customers, or classrooms as market share — but for better or worse, the new Detroit Public Schools can expect to remain in a fight for headcount with charters and private schools after a pair of restructuring bills reaches Gov. Rick Snyder’s desk. The state’s largest school district, with a total of 46,912 K-12 students last year, currently projects a net enrollment decline of about 550 students this coming

Legislation done, district now must compete

fall, or 1.2 percent. That’s an average of less than six students in each of its 97 school buildings, even though the district has averaged more than a 7 percent annual loss in the past eight years (from about 91,000 in 2008), and the state as a whole has averaged a 0.93 percent loss over the same period (from 1.64 million to 1.54 million). The legislation on Snyder’s desk appropriates about $150 million of initial funding to a successor district this fall.

State Treasurer Nick Khouri has estimated the new district will need $125 million for cash flow needs due to the timing of school aid payments and other startup expenses, and $10 million for academic program improvements. Transition manager Steven Rhodes and Interim Superintendent Alycia Meriweather said in an interview with Crain’s last week the district is working already to be more academically competitive — and Rhodes expects to submit a bal-

MUST READS OF THE WEEK

anced budget before departing as transition manager. About 27,000 school-age children in Detroit attend school outside the city daily, Meriweather said, and some families not enrolled in the district have shown interest in a new Montessori education program the district hopes to launch either this fall or next. The district also plans to offer a new enhanced blended learning program at AL Holmes Elementary-Middle School, and a new over-age English language learner

Steven Rhodes: Plans to submit a balanced budget for DPS before departing as transition manager this fall.

SEE DPS, PAGE 26

Fast-rising drug prices hit hospitals hard in bottom lines By Jay Greene jgreene@crain.com

When drug costs rose $20 million in one year for Beaumont Health, CEO John Fox asked executives like Kathy Pawlicki, vice president for pharmacy, why and what could be done about it. The answer? Not much. Leading factors for drug price increases are mostly out of providers’ control, including such recent trends as hedge funds acquiring generic-drug companies and then forcing up prices. Double-digit price increases have not affected just hospitals, but also clinics, insurers and retail pharmacies, experts said. Bob Kirby, corporate director for Chicago-based Fitch Ratings, said prices of such injectable heart medications as Nitropress and Isuprel doubled after Valeant Pharmaceuticals acquired the parent companies last year. Pfizer Inc., Amgen Inc., Allergan PLC, Horizon

Pharma PLC and others have raised U.S. prices

by up to 10 percent for dozens of branded drugs since last fall. Some drug prices might be discounted with rebates offered to insurers, other payers and group purchasing organizations. “We are seeing specialty pharma firms buying products or companies and then jacking up the price significantly,” Kirby said. “In some cases, consolidation is driving up the increases. Some drugs used in hospitals are only manufactured by a small number of companies.” Total U.S. prescription-drug spending rose 12.2 percent in 2015, accelerating from 2.4 percent growth in 2014, the Centers for Medicare and Medicaid Services said. But rising drug costs also can be attributed to an increased volume of patients because of Healthy Michigan Medicaid expansion, an improving economy and newer specialty, SEE DRUGS, PAGE 29

Whirlpool’s beer system gets a taste of crowdfunding By Dustin Walsh dwalsh@crain.com

Whirlpool Corp. launched a beer fermenting

Fit to sell ties

LARRY PEPLIN

Cyberoptix founder Bethany Shorb (pictured) ready to open a quirky new shop, Page 4

A level playing field Grand Valley State’s retiring athletics director pleased with Division II success, Page 18

How they rank Read Crain’s lists of the top publicly held companies and top-paid execs, Pages 22-23

system late last month, but the multibillion-dollar appliance giant went a route familiar to entrepreneurs to brew it up. The maker of brands such as Maytag, KitchenAid and others began offering its Vessi Beer Fermenter and Dispenser to homebrewing enthusiasts through crowdfunding website Indiegogo Inc. The move is a first for the Benton Township-based company, which is now part of a growing faction of multinational Fortune 500 corporations pitching their products through sites typically used by entrepreneurs and tinkerers. Dawn Noel Dolan, senior manager of strategic partner alliance and open innovation at Whirlpool, said the decision to launch the product on Indiegogo was to validate whether a viable market existed for the brewer — far afield from its usual washers and refrigerators. “It’s a more customer-focused way to go to

WHIRLPOOL CORP.

Sales of the Vessi Beer Fermenter and Dispenser on Indiegogo.com have surpassed Whirlpool Corp.’s expectations.

market,” Dolan said. “If, in the end, there isn’t a market, we didn’t spend millions of dollars on marketing and production to get the product out there.” The Vessi system is a single-tank fermenter that allows the users to control the pressure and temperature to speed the fermentation SEE WHIRLPOOL, PAGE 25

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Designed in Detroit Cyberoptix founder plans flagship store for ties, scarves, more By Vickie Elmer

Special to Crain's Detroit Business

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For years, Bethany Shorb, founder and primary designer at Cyberoptix, would say “no, no, no� to opening a retail store for her quirky Detroit tie and scarf company. She felt she was too busy and too much of an introvert. Now, Shorb is saying yes and will open a flagship store — in the same Gratiot Avenue building where the company has silkscreened ties by hand for a decade. But it will not be a tie shop, more like a gentleman’s and gift shop with surprises, with items made upstairs, including screen printed pillows, tea towels and cards, designer gifts and accessories focused largely on men — plus some vintage pieces. The 1,000-square-foot store is slated to open in November. “It’s a total dream,� she said, and it came together as her company grew and added more unique and affordable items that were less likely to sell online. The shop likely will be called Well Done Goods by Cyberoptix. Well Done Goods, founded three years ago as Shorb’s second brand, focuses on nontraditional ties made in fabrics such as recycled automotive leather and Michigan-made industrial felt. Besides a huge array of ties, the store will offer an array of gift and men’s fashion items, including tie bars and earrings, plenty of bags, wallets, laptop sleeves and more. They will be made in Detroit or purchased from designers in Los Angeles and elsewhere, Shorb said. “I’ve discovered so much cool stuff that nobody’s seen in Detroit yet,� she said. Shorb will sell from a building that has housed artists and art studios for decades. For 13 years, Shorb has had a studio in the Atlas Building and opened her tie business there in 2006. A Cranbrook Academy of Art graduate with a master’s in sculpture, she began making her own clothes, she said, “because I have champagne taste and a beer budget.� That frugal approach shows up in Cyberoptix’s tie prices, which range from around $30 for an angry kitten boys tie to $95, for the black hair-on hide leather tie. The company keeps its prices low by printing almost 95 percent of products to order, so there’s no inventory “collecting dust,� Shorb said. Cyberoptix sells its ties, ascots and scarves on its own website, on the online marketplace Etsy and at close to 400 museum and aquarium shops, and small independent merchants. Until recently, it had a small retail outlet in the Rust Belt Market in Ferndale. They have sold well at City Bird + Nest in Detroit since it opened in 2009. Shorb “is constantly evolving and growing her business, and her attention to detail and craftsmanship are outstanding — it’s always a

LARRY PEPLIN

Cyberoptix employee Jess Yoakum prints a tie inside the company’s studio in the Atlas Building in Detroit.

pleasure to work with her,� said Emily Linn, co-owner of City Bird. “We really admire how hard she works and her vast assortment of designs

strike a perfect balance between complete originality, and recognizing and responding to design SEE NEXT PAGE

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trends.” Yet Shorb is well aware that tie sales have been declining for years, as more workplaces go casual. “A lot of people just don’t wear ties. I feel like the ties and scarves should have some friends,” she said. Company revenue grew almost 75 percent from 2013 to 2015, going from $403,363 to $710,859. Last year during the holidays, Shorb’s team shipped around the clock, and sent out a record 250 packages in one day. Cyberoptix employs 15 people, and will add two summer interns shortly, Shorb said. (That doesn’t include a gray cat named Rozwell, or Roz, who sometimes wears a tie at the studio.) Roz is the inspiration of a variety of cat ties and cat gift items sold in the new shop. The shop will be infused with a retro feelPHOTOS BY LARRY PEPLIN ing, includThe distinctive ties sold ing a in Bethany Shorb’s new 1970s-era shop will provide a retro Emergency feeling. sign that used to mark a hospital entrance. “It’s for gift and fashion emergencies,” Shorb said. Her shop will open in tandem with another retailer, Boro. Boro is a consignment shop for contemporary clothing and accessories that will offer higher-end labels, said owner Miriam Pranschke, who lives at Atlas and has worked for three years at RunDetroit, a running shop. Shorb believes it may be the first time since Atlas Furniture Co. closed in the 1960s that retailers have sold goods from the first floor. She changed her mind on opening a store after seeing “the huge crazy world of trade shows and markets” and realizing her staff could run the shop. Shorb also sees it as a place to offer new merchandise, and some “geeky, niche” items. “I wanted to have a space where we could shout out what we do,” she said.

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For inspiration, there is a list of ideas inside Cyberoptix studios in Detroit.

Ŷ

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Hastings

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OPINION

It’s time to focus on educating DPS kids M

ichigan lawmakers adjourned last week for a 12-week summer vacation. And supporters of school reform in Detroit are angry and disappointed that lawmakers in the House carried the day and pushed their priorities in what was eventually passed. Some words of advice: It’s over. It’s done. The idea of creating an “education commission” to rationalize state investments in traditional public and charter schools won’t be happening. So adults arguing over governance models need to focus instead on what matters most: Kids. What are the best paths forward to improve the education of Detroit kids? Crisis has a way of galvanizing people and institutions. It happened with Detroit’s bankruptcy. It happened when General Motors was on the ropes. In an editorial board meeting last week, Detroit schools chief Alycia Meriweather described a recent teacher job fair, about 400 would-be teachers showed up, many of whom said they were interested in helping the district. Meriweather could use some help from the business community. Maybe that’s where the energy for reform should focus: Uniting business and civic support to make mediocre schools outstanding.

Rogers aided in ‘mobility’ shift When Oakland County Executive L. Brooks Patterson launched Automation Alley in 1999, we noted that the technology initiative sounded more like a high-tech bowling alley than a technology push. But Ken Rogers, who retires in August as the first and only executive director of the business association, built it from an initial 42 members to more than 1,000 companies, educational institutions, nonprofits and governments. Through trade missions, mentoring, networking and awards programs, “the Alley” has helped the region think of itself as more than “bending metal.” Today, Southeast Michigan is growing in its recognition as a center for “mobility” — the technology that will power autonomous vehicles can be developed here. But in 1999, the region’s view of itself was quite different. Rogers deserves credit for helping to make that shift.

TALK ON THE WEB Re: Keith Crain: Regional transit is going to be a very hard sell There are huge benefits to not only the Ann Arbor-Detroit commuter rail, but for rail travel in general from West Michigan and Grand Rapids, through Lansing and into Detroit. Living in Grand Rapids, there are countless number of times where we talk to friends and family who could take advantage of such a service. Sending kids to see family in Lansing, Ann Arbor or Detroit. Having one spouse in a single-car family be able to take a train to see friends or family across the state. Business trips. Ballgames. Concerts. Festivals. University students being able to travel home and to school. The lives of average people in Michigan can be helped by better transit op-

tions.

BrewPubNate

more economic development in our city. There is nothing that will hurt our image and stop all the good that has happened in the past few years more surely than a continuation of the senseless shootings throughout our community. The No. 1 priority for our elected officials and our police force is safety. We have to do whatever is required to make sure our residents are safe and shut down the violent gangs in our community. Many will blame the “Ferguson Effect,” and

system, or our car culture, or perhaps the “urban sprawl” which has no single center of commerce. Or maybe all of these combined means that mass transit isn’t a good idea. MikeInMI

As the RTA reaches full bloom, it will become just another stop on the term-limited-legislator tour and another home for the “public service” dandy. No, I’ve seen this movie before: It’s expensive and it doesn’t end well. I’ll be voting “no” and continue to complain about the lack of transportation alternatives. Wheelman

After 23 previously failed attempts to fix this (per the Metro Times), perhaps we need to accept that Detroit is not well-suited for mass transit. Maybe it is our road

Stop the violence We always seem to be competing with Chicago, whether it’s with the White Sox, the Bears or the Bulls. We compete fiercely with Chicago for economic development. But now it seems we are starting to compete with gun and gang violence, and we have to do whatever it takes to stop it in its tracks. Detroit has been enjoying a real revival in just about every area you can think. Our image has skyrocketed, and each day you hear about

Reader responses to stories and blogs that appeared on Crain’s website. Comments may be edited for length and clarity.

KEITH CRAIN Editor in chief

they may well be correct. It doesn’t really matter. Since most residents and business executives aren’t criminal experts, all they understand are the results, not the cause. The mayor and city council have to give the police department

Re: Snyder: Relentless clearing of the air? The people who have a favorwhatever support is required to get this violence stopped so it doesn’t continue. If we want to watch our economic development stop dead in the water, then all the community has to do is continue to tolerate the shootings and drive-by violence. Make no mistake that the daily press and broadcasters will delight in promoting what’s happening. The count of shootings and deaths is climbing. This has to become the top priority for our mayor. For all the good that is going on in our city, this is a cancer that must be stopped right now. It’s bad right now and has the

able opinion of Snyder are people who have not been hurt by Snyder. These people have not been impacted by the increased tax burden on senior citizens, the poisoned water in Flint or the lack of heat and toilet paper in Detroit Public Schools. Snyder attempts to solve everything with tax hikes on individuals. Snyder is a much heavier tax increaser than any Democrat that I have ever heard of. Carolyn Mazurkiewicz

Re: Aid for 6 Mich. universities will remain below 2011 levels The reality is the Michigan taxpayers are paying more of their earnings to the hidden tax called regulations, on both the state and, moreso, the federal level. In addition to these hidden taxes, we keep hearing for calls for a little tax increase here and there — each that add another feeding of inefficient politically motivated programs to

keep citizens under the thumb of Big Government.

NoSpinJustFacts

potential to be much worse if left unchecked. Right now, our residents are very aware of this challenge. Tomorrow, if left unchecked, we could knock Chicago off the front pages and reclaim our old and distasteful nickname, “Murder City.” There are plenty of experts who can tell our law enforcement officials what we need. But we know one thing for sure. This has to be the mayor’s No. 1 priority. It’s a lot more important than demolition or economic development or transportation — or anything. It’s time for the mayor to declare war on gangs and violence.

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Time to connect: Regional transit system essential to future

D

etroit Medical Center has been a committed citizen of Detroit and Southeast Michigan for over 150 years. Since opening our first facility in Detroit, DMC has added locations throughout the region to provide the best possible service. We’re proud to play a part in the revitalization of the region; however, we recognize one critical issue that is negatively affecting Southeast Michigan and the people here: disconnected regional transit. Fortunately, after years of underfunding the regional transit system, the recently released Regional Transit Authority of Southeast Michigan’s Regional Master Transit Plan gives our four counties the chance to secure a 21st century regional transit network to connect people to jobs and opportunities. This is the solution to problems of disconnected transit that have plagued the region for far too long. DMC believes that quality health care is a basic right of every human being. As one of the largest health care providers in Southeast Michigan, DMC attracts patients from across the region seeking the help of world-class specialty programs. However, in order for patients to take advantage of our award-winning programs, they need transportation that enables them to reach our facilities throughout the region. Accessibility is essential for high-quality health care. Unfortunately, Michigan’s current disjointed network of separate transit providers leaves far too many communities not served or far underserved. A lack of reliable regional transit especially affects the most vulnerable or underserved citizens in Southeast Michigan. This includes seniors and people with disabilities, who may not be able to drive. Being unable to drive should not hinder a person’s independence. However, according to the Centers for Disease Control, adults with disabilities are twice as likely as adults without disabilities to lack adequate access to regional transit, which prevents

June 21 event to honor Most Influential Women Crain’s will honor the 2016 Most Influential Women in Michigan at a June 21 event at Suburban Collection Showplace in Novi. The program runs 6-9 p.m. and will include a strolling dinner. Register at crainsdetroit.com/events. Tickets are $125 each; $115 each for groups of 10 or more; and $115 for Most Influential Women alumni. Walk-in registration, if available, will be $150. Questions? Contact Kacey Anderson, cdbevents@crain.com, (313) 446-0300. For out-of-town attendees, a block of hotel rooms has been reserved at the Hyatt Place Detroit Novi. They can be reserved at novi.place.hyatt.com or by calling (800) 233-1234.

OTHER VOICES Joe Mullany

Mullany is CEO of the Detroit Medical Center. them from reliably getting to health appointments on time. It is not just people who can’t

drive who are negatively affected by disconnected regional public transit. A majority of employees are unable to rely on public transit to get to work; 92 percent of jobs in Southeast Michigan cannot be reached within 60 minutes on regional public transit. This negatively affects employers, like DMC, and employees alike. Finally, high-quality transit is a proven economic-growth engine. The American Public Transportation Association found that, on average, every $1 invested in public transit results in $4 in economic re-

turns for the region. Cities like Cleveland and Seattle are experiencing tremendous returns on investment in their regional transit networks. Southeast Michigan’s underinvestment in comprehensive regional transit prevents our region from attracting the same type of benefits. We cannot waste this opportunity to reliably connect our communities. The Regional Master Transit Plan will connect people to jobs (benefiting employers and employees), help increase independence for seniors and people with disabili-

ties, attract and retain young talent, and spur economic development. A connected regional transit system is essential to the future of Southeast Michigan. We cannot leave Southeast Michigan’s four counties — Wayne, Oakland, Macomb and Washtenaw — disconnected. The RTA’s Regional Master Transit Plan will enable seamless, reliable and connected travel throughout the region. Please visit www.rtamichigan.org to review the plan and submit your feedback for an even greater, connected regional transit system.

When the goal is not riches, but to live richly. For the sake of discussion, let’s say wealth is a relative term. To some, it could be a matter of net worth. To others, it might mean lifelong friends, close-knit family and good health. To others still, it could be the ability to do and have what is most rewarding. Whatever the definition, and regardless of whether wealth is a means or an end, those who have it also have goals that shape their decisions. That’s why clients of Greenleaf Trust benefit so greatly from our goals-based wealth management approach. Thoughtful and holistic in its methodology, it ensures clear-minded focus on achieving the things in life that are most important and meaningful to you. Through reliable benchmarks we measure progress in meeting those goals, instead of solely measuring performance against a narrow financial index. And at every step of the way, our client centric team model puts your well-being, and peace of mind, at the center of every decision. To learn more about how Greenleaf Trust can help you live a life well spent, call us.

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WORLDWATCH WHERE MICHIGAN DOES BUSINESS: MEXICO

Autoliv Inc. Based: Auburn Hills Operations: Manufacturing

plants in Tijuana, Matamoros and Lerma, and three manufacturing plants in Querétaro Employees: 11,000 Products/Services: Airbags, seatbelts, seatbelt webbing and airbag cushions Top executive: Dan Garceau, president of Autoliv North America Clients: Volkswagen Group, General Motors Co., Hyundai-Kia Automotive Group, Great Wall Motor Co., Honda Motor Co., Peugeot SA, Chery Automotive Co., Geely Automotive Holdings Ltd.

Cooper-Standard Automotive Inc. Based: Novi Operations: Manufacturing

facilities in Aguascalientes, Atlacomulco, Juárez, Guaymas, Guaymas West, Saltillo, Silao and Torreón Employees: 4,450 Products/Services: Fluid transfer systems, fuel and break delivery systems and sealing systems Top executive: William Pumphrey, senior vice president and president for North America Clients: Bosch, Daimler Truck, Delphi, FCA, Ford Motor Co., General Motors Co., Honda, Hutchinson, Kasai, Kautex, Magna, Navistar, Nissan Renault, NormaGroup, PACCAR Inc., Plastic Omnium, Tesla Motors, TI Automotive, Toyota, Valeo, Visteon, Volkswagen Group

Domino’s Pizza Inc. Based: Ann Arbor Operations: Headquarters in

Mexico City and 618 pizza stores throughout the country Employees: 13,000 Products: Pizza, sandwiches, chicken Top executive: Alberto Torrado Martinez, CEO

W

ith a nominal 2015 GDP of $1.1 trillion, Mexico is the world’s 12th-largest economy. In the two decades of the North American Free Trade Agreement, Mexico’s economy has relied more heavily on its manufacturing industry, according to the CIA World Factbook. Mexico is the United States’ third-largest import market and second-largest export market. Mexico’s largest exports are automobiles, oil and oil products, silver, fruits/vegetables, manufactured goods, coffee and cotton, according to 2014 data. Its biggest export partner is the U.S. (80.2 percent). Mexico’s largest imports are steel mill products, electrical equipment, automobile parts for assembly and repair, metalworking machines, aircraft and aircraft parts. Its biggest import partners are the U.S. (48.8 percent), China (16.6 percent) and Japan (4.4 percent). Each World Watch features a different country. If you know of a Michigan company that exports, manufactures abroad or has facilities abroad, email Gary Piatek, senior editor, at gpiatek@crain.com. COMING UP July: United Kingdom | August: Thailand and Malaysia

Top executive: Filip Tauson, general manager for the north region of Latin America

Faurecia North America Inc. Based: Auburn Hills Operations: Shared services

center, R&D facility and production plant in Puebla; production plants in Hermosillo, Querétaro, Ramos Arizpe, San Luis Potosí and Silao as well as an R&D facility in Santa Fe Products/Services: Include door panels, IP, center consoles, wrapping, small-parts injection, full-seat architecture development, full exhaust line, product engineering and project development Employees: 9,000 Top executive: Francisco Maciel, CFO and country lead Clients: Volkswagen Group, Ford Motor Co., General Motors Co., Fiat, Chrysler, Honda, Nissan

More information: Domino’s Pizza Mexico is part of Alsea, a company that operates Starbucks and some Burger King outlets in the country.

Dow Chemical Co. Based: Midland Operations: Headquarters for

north region in Latin America in Mexico City; sales office for agricultural business in Guadalajara; four manufacturing sites in Querétaro, Tlaxcala and Toluca; two experimental field R&D centers in Puerto Vallarta and Nextipac Employees: 391 Products/Services: Polyurethane systems, herbicides and insecticides, biocides production, acrylic emulsions and polyacrylates used in paints and adhesives for packaging and leather industries

An FCA plant in Saltillo.

COURTESY FCA

FCA US LLC Based: Auburn Hills Operations: Headquarters in

Santa Fe with seven plants in Toluca and Saltillo and an engineering center in Mexico City Employees: 11,000 Products/Services: Body panels and various car models and engines Top executive: Bruno Cattori, president and CEO of FCA Mexico

Clients: 294 dealerships

Federal-Mogul Corp. Based: Southfield Powertrain operations: Facilities

in Aguascalientes, Juárez, Mexico City, Puebla, Naucalpan and Tepotzotlán; powertrain/ motorparts administration offices in Tlalnepantla de Baz Motorparts operations: Facilities in Juárez, Los Reyes, Tlalnepantla, Tepotzotlán, Tultitlán, Iztapalapa and a motorparts distribution center in Tlalnepantla Products/Services: Valvetrain, lighting, ignition, pistons, bearings, sealing, wipers, chassis, more Employees: 7,000 Top executive: Miguel Garcia, (powertrain) director general

Ford Motor Co. Based: Dearborn Operations: Two stamping and

assembly plants in Cuautitlán and Hermosillo and an engine plant in Chihuahua Employees: 8,800 Products/Services: Stamping and assembly of the Ford Fiesta, Ford Fusion and Lincoln MKZ as well as engine production Top executive: Gabriel Lopez, president and CEO of Ford of Mexico

International Automotive Components Group Based: Southfield Operations: Engineering/design

center in Toluca; manufacturing plants in Hermosillo, Monterrey, Puebla, Querétaro, Ramos Arizpe, Saltillo, Arteaga and Toluca Employees: 7,500 Products: Automotive interior

products, including door panels, consoles, instrument panels, and flooring and acoustics Top executive: Pablo Barreiro, senior director of commercial, sales Clients: Ford Motor Co., General Motors Co., FCA US LLC, RenaultNissan Alliance, Volkswagen AG, BMW, Honda Motor Co., Mercedes-Benz AG

Inteva Products LLC Based: Troy Operations: Two manufacturing

facilities in Matamoros, one technical center in Juárez, one manufacturing facility in Puebla and a manufacturing facility coming to Silao in early 2017 Employees: 4,130 Products/Services: Door latches, door modules, injection molded parts, instrument panels, sunroofs, plastic resin materials, more Top executive: Rosalinda Torres, operations director for Mexico and South America Clients: Audi, FCA, Ford Motor Co., Freightliner, General Motors Co., Mercedes Benz, Navistar International Co., Paccar Inc., Tesla Motors, Toyota Motor Corp., Volkswagen AG

Kelly Services Inc.

Products/Services: Consulting, training, auditing and certification for all the supply chain in the food industry, including agriculture, food processors, distributors and retail, product certification and registrations for the non-food compound and food equipment industries and certification for the automotive and aerospace industries Top executives: Sonia Acuña Rubio, managing director for Latin America; Isabel Coronado, regional director of operations for Mexico

Perrigo Co. Based: Allegan Operations: Nine facilities

throughout Mexico City, Ramos Arizpe and Naucalpan, including offices, warehouses, laboratories and manufacturing facilities Employees: 1,200 Products/Services: Oral liquids such as suspensions, and syrups; oral solids such as tablet adhesives; semisolids such as ointments Top executive: Sharon Kochan, executive vice president and general manager Clients: Global, national and regional retail drug, supermarket and mass merchandise chains

Based: Troy Operations: 13 offices in Mexicali,

Chihuahua, Juárez, Monterrey, Guadalajara, Aguascalientes, Irapuato, Querétaro, Celaya, Mexico City, Estado de México, Puebla and Villahermosa Employees: 12,000 temporary employees monthly and 450 full-time employees Products/Services: Staffing and recruitment; process outsourcing for payroll, business, recruitment and contingent workforce; HR consulting and socioeconomic studies Top executive: Gabriel Aparicio Segovia, GM for Mexico Clients: Automotive, pharmaceutical, IT, logistics, professional services, financial, engineering, oil and gas, other

MPG Inc. Based: Southfield Operations: Two manufacturing

facilities in Ramos Arizpe Employees: 540 Products/Services: Forged and fully machined powder metal connecting rods, differential and sprocket assemblies, transmission clutch modules, more Top executive: Alfonso Aguado, plant director Clients: Ford Motor Co., General Motors Co., Opel, FCA, Yamaha, Volkswagen AG, ZF Friedrichshafen AG

NSF International Based: Ann Arbor Operations: A facility in Querétaro Employees: 66

COURTESY TI AUTOMOTIVE

A TI Automotive plant in Monterrey.

TI Automotive Ltd. Based: Auburn Hills Operations: Ten manufacturing

locations in Mexico City, Monterrey, Puebla, Reynosa and San Luis Potosí Employees: 3,500 Products/Services: Automotive fluid-carrying systems, plastic fuel tanks, fuel pumps and modules, HVAC fluid systems, other Top executive: Alejandro Veraza, general manager of fluid-carrying systems for Mexico Clients: BMW AG, FCA US LLC, General Motors Co., Renault-Nissan AG, Volkswagen AG, Kia

Vision Information Technologies Inc. Based: Detroit Operations: HQ in Mexico City

with an IT delivery center and recruiting operation in Puebla Employees: 100 Products/Services: IT managed services, application solutions and IT security technologies, and IT talent management and recruiting services throughout the country Top executive: Luis A. González Noriega, country manager for

Mexico and Central America

Natalie Broda

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SPECIAL REPORT: ST. CLAIR COUNTY MARY KRAMER Publisher

mkramer@crain.com Twitter: @MKramerCrain

New Consumers CEO has eye on economy Mary Barra has company. The General Motors CEO has been the only woman running a for-profit multibillion-dollar enterprise in Michigan. This summer, Patricia “Patti” Poppe takes over the reins of Consumers Energy, the Jackson-based company with a statewide footprint and more than $6 billion in revenue. Interesting footnote: Poppe’s roots are in General Motors, where she worked as a plant manager before returning to her hometown and joining the company where her father had worked as an engineer. GM seems to have developed a kind of “secret sauce” of talent development — at least when it comes to identifying and developing women. Poppe is building on the initiatives created by her predecessor, John Russell, who presided over the cleanup after the tragic gas explosion in Royal Oak that killed a man three years ago. Mistakes Poppe were made when crews were installing a new gas main; procedures weren’t followed. And nine employees were fired as a result. “It was a wake-up call,” Poppe said in an interview during the Detroit Regional Chamber’s Mackinac Policy Conference. It led to a companywide culture change and the creation of “CE Way” — getting work done right the first time, eliminating waste and doing work on time. Poppe said she is putting her automotive background — focusing on processes, quality and verification — to work at Consumers. And Consumers is returning to a traditional but under-the-radar role “utilities” had for many years in Michigan — economic development. Makes sense: Michigan’s population isn’t growing, so if you are in the business of selling power, what can you do to expand demand? Answer: Bring more companies to Michigan. She expects to expand the five-person economic development team, a group that recently helped bring a German manufacturer to the state and helped to seal the decision by Nevada-based Switch to develop a massive data center in suburban Grand Rapids. What did Consumers bring to the party? A plan for 100 percent of new renewable power generation needed to offset Switch’s load. Like many customers, Switch has a focus on sustainability and renewable energy. Meeting the energy requirement means the center will likely open later this year and is projected to employ 1,000 people and spend $5 billion over 10 years. Poppe should be at the ribbon-cutting. Mary Kramer is publisher of Crain’s Detroit Business. Catch her take on business news at 6:10 a.m. Mondays on the Paul W. Smith show on WJR AM 760 and in her blog at www.crainsdetroit.com.

Catching an

economic wave

PHOTO BY MARK RUMMEL

Blue Water area navigates changing currents - including its own attitudes By Gary Anglebrandt

Collaborative investment

The economy of St. Clair County has long lagged those of its metro Detroit neighbors to the south; its biggest hurdle may be moving the mindset of its own residents. High school graduates are as likely to head for the county border in search of greater opportunities as to stay, and residents see local leaders as just as likely to get in the way of new ideas as to encourage any. “The city didn’t get along with the county. The foundation stuck to itself. Everyone just did their own thing,” said Randy Maiers, president of the Community Foundation of St. Clair County. But a spate of recent projects, totaling $234 million in planned or underway investment, has development officials touting a reversal of that trend. They say there’s a new appreciation for collaboration and making better use of the area’s natural asset, its water geography, to attract business. They aren’t predicting a massive economic boom or large-scale influx of new residents, but instead simply want to capitalize on what exists to create an improved quality of life for those who are there. “We’ve been failing in promoting our area for investment and as a place to live,” said Daniel Casey, CEO of St. Clair County’s Economic Development Alliance, which has been following Blue Meets Green, a strategic plan to boost the economy (blue referring to the Blue Water Area identity the county has long used). “What we’re trying to do is improve the quality-of-life assets we have, increase economic development efforts to take advantage of some of the lower business costs available in our county and improve the overall economic future,” Casey said. Water frontage on the St. Clair River and Lake Huron runs alongside the whole eastern stretch of the county, which has a popu-

The inn had been one of just a handful of restaurants, and even fewer higher-end restaurants, on the entirety of the 35 miles of the St. Clair River — odd for a collection of towns that calls itself the “Blue Water Area” after the striking blue tones of the St. Clair River and Lake Huron. It sits right in the shadow of the Blue Water Bridge, which crosses the the turbulent point where the river and lake meet. The inn had been locally owned and was doing poorly until a group of investors bought it and turned it into a DoubleTree by Hilton hotel with a destination restaurant called Freighters Eatery and Taproom. The county followed with the building of a new $9 million convention center there, and Baker College installed a culinary school and continues to expand it with a new set of dorms. Baker’s investment in the culinary school totals $5.9 million. A Hilton brand hotel was a step up from the Thomas Edison Inn. “When Hilton blessed that site, people started to raise their eyebrows,” said Gerry Kramer, head of Port Huron-based Kramer Realty Inc. and one of the investors. The Hilton deal was the work of investors Robert Schermer, CEO of Grand Rapids-based Meritage Hospitality Group Inc.; John Wheeler, director of business development at Orion Construction Inc., also in Grand Rapids; and Kramer, along with seven other investors from the Grand Rapids area. Meritage holds the lease for Freighters. The investors formed the Grand Rapids-based entity JB Realty LLC for the venture. Hilton demanded 105 changes to the hotel to bring it to the chain’s standards, costing JB Realty $6 million, including $1 million just for the kitchen. They plan to spend another $2 million on further renovations. Of the $234 million in recent projects, the

ganglebrandt@crain.com

COURTESY BLUE WATER SANDFEST

More coverage inside With events to promote like the Blue Water SandFest (above), St. Clair County officials are aiming to carve out a tourism niche, Page 12. The Blue Water area is tapping into the popular craft beer and wine culture, Page 14. Other projects in the works for St. Clair County, Page 13.

lation of 160,000. Most of the new development projects are in Port Huron, the county’s seat and largest city. One of the more notable projects there is the transformation of the site of the former Thomas Edison Inn.

SEE ST. CLAIR, PAGE 10

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SPECIAL REPORT: ST. CLAIR COUNTY

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ST. CLAIR FROM PAGE 9

Transforming the face of health care in our community The next few years mark a period of extraordinary growth and development at McLaren Port Huron. In 2016, groundbreaking for a four-story patient tower will begin and the new Barbara Ann Karmanos Cancer Institute will open to provide nationally-renowned cancer services. This $162 million investment represents the next step in providing our community with the very latest clinical services and technology while providing greater privacy and comfort for our patients and their families.

mclaren.org/phrising 2015

2016

Construction begins

Karmanos Cancer Institute occupancy

2017

2018

Patient Tower occupancy Cancer services full occupancy

Project completion

biggest on the list is a $162 million expansion of a McLaren hospital in downtown Port Huron that will include building a 70-room patient tower and a Karmanos Cancer Institute center; Flint-based McLaren Health Care Corp. bought the hospital in 2014. In years past, development money usually came from locals and efforts to seek outside investment focused on attracting manufacturers. But the past few years have seen outside money coming in for projects on the waterfront like hotels, restaurants and condos. An important aspect of that, county development boosters say, is participation of outsiders drawn to the area’s scenery and seeing opportunities in an overlooked area. “The difference now is we have a lot of out-of-town investment. That’s a big pivot here,” Kramer said. Other hospitality and residential projects include: n Revival of the St. Clair Inn in St. Clair. The historic inn had been a mainstay and rare spot for a higher-end dining experience in the county until mismanagement led to its closing in 2014. The inn originally opened in 1926 with money raised by the local Rotary Club. This year, California developer Jeff Katofsky bought it for a price “in the range of” $8 million. He plans to spend $40 million renovating it and building a structure across the street that will have nine retail shops and another roughly 40 rooms, in addition to the nearly 100 rooms at the inn. He is seeking historic building grants and plans to reopen the inn in the summer of 2017. n Chuck Reid, owner of CityFlats-branded hotels in Holland and Grand Rapids, has purchased two downtown buildings, one for a third location for his bou-

Econ

LISA SAWYER

tique hotel chain and another for a restaurant and movie theater. That will bring the small downtown, which many feared would go dead during the mall-frenzy of the 1990s, to near full occupancy. His total expected investment comes to more than $20 million, according to the foundation. n LeRoy and Allen Stevens, two brothers who grew up in Port Huron, plan to build an 80-unit riverfront condominium building, the SEE NEXT PAGE

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

SPECIAL REPORT: ST. CLAIR COUNTY Water Trails System, one of only 18 in the country.

FROM PREVIOUS PAGE

Bluewater View, on the site of a former YMCA, and they’re leaving open the possibility of adding up to two more buildings if the demand is there. The project is billed as luxury, though no price points have been floated yet. The investment comes to about $14 million, according to the Community Foundation of St. Clair County. Construction is slated to begin in 2017.

Talent retention

n St. Clair County Community College this year bought the McMorran

Pavilion, a small arena, from the city of Port Huron next to its campus downtown, and plans to renovate it into the SC4 Fieldhouse, housing the school’s athletic programs. The project cost is $3 million. The move will make way for the school to raze its current gymnasium and use that space to build a new home for its health and science program.

MARK RUMMEL

Top photo: A CityFlats hotel will go up at the site of a bank building in Port Huron; bottom: the St. Clair Inn is being renovated with retail shops and additional rooms.

Opportunity as a distribution hub? Casey believes the big projects list could grow by tapping into the area’s unrealized potential as a logistics center for warehousing and distribution companies. The county, via the Blue Water Bridge, connects the Canadian and American expressway systems and ultimately deep water ports on the coasts. Railways cross through the county, which contains a large railyard just west of Port Huron. A rail tunnel goes under the St. Clair River into Canada. Land and wages come at cheaper prices than in metro Detroit. “But we don’t have a cluster of warehousing and distribution centers. I’m amazed at that,” he said. St. Clair County is part of a regional study funded by the Michigan Economic Development Corp. looking at intermodal transportation. More needs and recommendations will come out of it in the months ahead. In the meantime, development officials are pitching the county to warehouse and distribution companies. St. Clair County doesn’t have the property inventory to attract big brokerage firms. “It’s still a village,” said Kramer, who's been doing commercial real estate in the area since 1975. The lack of major property brokerage firms means local boosters have to work more closely with local brokers and hire outside site consultants, Casey said. “I’d say we have to work harder than other areas to get attention.” Last year saw a total investment of $418 million in the county, according to the alliance. “For us, that’s pretty good. Macomb might be disappointed by that, but we have something like one-fifth or one-sixth the population,” Casey said. Robert Eppley, an owner of Alpine Cycles Inc., a bicycle shop downtown that's been open since 1981, pointed to the investments coming from Grand Rapids, saying these mark a shift in that they come from out of the area and have been vetted more thoroughly than “fly-by-

night” projects that failed to take off in earlier years. “The people doing the work are better moneyed than in the past,” Eppley said. The Grand Rapids connection, as seen in the Hilton and CityFlats Hotel projects, suits development leaders just fine. They see for the Port Huron area a similar and logical path in the blend of public, private and philanthropic money the West Michigan city used to revive itself. “We want to follow that Grand Rapids model,” Maiers said. The area already has some track record for that in the riverfront redevelopment led by local philanthropist Jim Acheson, who bought, cleaned up and donated a mile-long stretch of waterfront property in downtown Port Huron previously filled by a cement plant, railyard, scrapyard and the detritus of 100 years of industry. Acheson financed this with his share of the sale of the family business, Acheson Industries, a chemical company based in Port Huron for most of the 20th century until its 1998 sale to a British company for $560 million. The ensuing transformation, still under way, also is akin to that of Detroit’s riverfront, while on a smaller scale. The new appreciation for the local geography has been further carried by the building of kayak launches and bicycle trails. Tourism promoters have picked up on a water path local canoers and kayakers have been using for some time: Thanks to a man-made canal running from Lake Huron through the north of town to Black River, it is possible to circumnavigate the “island” that is roughly half of Port Huron. Kayakers go from a launch in

the Black River, up the canal to Lake Huron, down the St. Clair River to the mouth of the Black River and back to their launch point. The journey offers rural, urban, downtown and industrial scenes on a path of 10 miles. The Island Loop Route has gained designation from the federal National

Quality-of-life improvements are the lure to get people who left to return and further raise the economy. “We don’t worry so much about kids leaving after college, but can we get them to return?” Casey said. “The real target is trying to recruit families.” The county still faces headwinds. Only 17 percent of its residents have a college degree, compared with 23 percent in Macomb, 22 percent in Wayne and 44 percent in Oakland, according to federal data for 20102014. Its unemployment rate of 7.1 percent is the highest of any metro Detroit county. Port Huron has well-entrenched rough neighborhoods. About 40 percent of the city’s homes are rentals, said City Manager James Freed. The unemployment rate might be high, but “if you look at where we came from, at one point we were north of 15 or 17 percent,” Freed said. He also finds encouragement in new education initiatives to improve the higher education demographics, especially the tie-ins with the community college and efforts to plug gaps in demand for skilled labor. “The key to breaking the cycle of poverty is giving these kids the skills to get a job,” Freed said. Education is the next big priority for the area, said Donna Niester, chairwoman of the Community Foundation and president of Acheson Ventures LLC, which this

year began a “reverse scholarship” program that entices people to return by helping them pay their college loans. The first three recipients were announced last month, with each receiving $10,000. One is a veterinarian, another is a medical laboratory scientist, the third is a speech pathologist. Other efforts are aimed at career services and filling skills gaps, especially in the skilled trades. Under the Blue Water Middle College program, high school students can earn credit at St. Clair County Community College, giving them a jumpstart before graduating. “Port Huron is not perfect, but it is much better,” Maiers said. Casey, who previously did economic development for Rochester Hills, said he was surprised at the readiness to say “no” to new ideas when he came to St. Clair County five years ago. Local residents and businesses have long gotten used to living in an area that seemed it would forever be what it always has been: a sleepy backwater at the far end of metro Detroit. Perceptions lag whatever serious economic development may come. “There’s a little disbelief,” Casey said. “What’s changed is we’re all collaborating now,” Casey said, though, “we still have our detractors.” Niester at Acheson Ventures also is aware of the prevailing cultural hurdles. “I grew up in Macomb County; it’s not that far away, but the mindset is totally different,” she said. “The next big thing to happen to Port Huron is it has to believe it can, and that we’re worthy.”

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SPECIAL REPORT: ST. CLAIR COUNTY

From Blue Water Fest to SandFest, St.Clair aims to carve out tourism niche By Amy Lane

Special to Crain’s Detroit Business

In Marine City and elsewhere in St. Clair County, Kathy Vertin sees tourism opportunity. And she and her husband, Tom, transplants from neighboring Macomb County, where he until 2006 owned automotive and aerospace tooling company Visioneering Inc., are doing their part to draw visitors in. Pursuing an early passion of Kathy’s, the Vertins in 2013 and 2014 opened two live-performance theaters in downtown Marine City, putting on a combined 10 to 12 productions annually at the Snug and Riverbank theaters and drawing audiences from St. Clair County, Southeast Michigan and Canada. And now, fueled by resurgence in the downtown area and feedback from theater patrons, the Vertins are adding what Kathy calls “the next logical piece” — hotel accommodations. At a corner where a car dealership has stood will be their new $4 million Inn on Water Street, a hotel that Vertin said will have architecture and atmosphere in concert with the town’s ship-building roots and feature 24 guest rooms, meeting and conference space and four condominiums.

COURTESY PHOTO

The Inn on Water Street will have 24 guest rooms and space for meetings and conferences in Marine City. Vertin said the hotel, which she targets for opening in spring/summer 2018, will provide a new overnight option for theater patrons and other visitors she hopes to draw from current markets and a new target: Ohio. “I think that’s really important to try and bring more of that tourism market into this area,” said Vertin, once a vice president at the Detroit Metro Convention & Visitors Bureau. “Northern Michigan can be a little too far for folks who are down in Ohio, while this is a nice little road trip.”

But “there’s not a lot out this way for accommodations,” Vertin said. “To have a proper return on the marketing, you need to have more to offer. That’s why we think a small boutique inn will add to the ambience of the area.” The desire to be a destination where people come to visit, explore and stay echoes throughout the Blue Water region. A sharpened focus on tourism in 2008 led to stakeholders and communities stretching through St. Clair, Sanilac and Huron counties joining under a new “Discover the Blue” marketing banner — a collaboration led by the Blue Water Area Convention & Visitors Bureau.

“It’s a mission to cross-promote 140 miles of shoreline,” said Marci Fogal, bureau president. An initial $50,000 budget, funded by municipalities and community organizations, covered costs like creating the bluewater.org website to promote shoreline communities as tourist destinations, and participating in a Pure Michigan advertising program that included an audio ad cut specifically for the area and featuring the now-familiar voice of actor Tim Allen. The Pure Michigan ad, which has run in Indiana, Ohio and Canada and can also be heard locally on some organizations’ caller-hold lines, invites immersion in a place “that’s all about open spaces,” where people can swim and sail in Lake Huron, stretch legs on a boardwalk, bike along the shoreline, “or just watch freighters drift by.” Allen says, “Here we feel the stress of the day wash away, and out of the blue, we start to breathe again.” The budget for Discover the Blue over the years has grown ten-fold to about $500,000, adding such promotions as a Discover the Blue visitors guide, digital billboards to promote community events, seven digital kiosks with tourist information, 20 video-playing TVs installed in high-tourist-traffic areas and cross-selling — like a TV at a restaurant in St. Clair that plays an ad about shopping in Lexington. Fogal said increased hotel and motel occupancy rates in St. Clair County are an indication that efforts

to build tourism are paying off. Occupancy has risen more than 3 percentage points in the past few years to the current 65 percent, reflecting both the marketing push and an improving economy, she said. An analysis detailing Michigan county-level travel economic impact data, released late last year by Travel Michigan and compiled by Philadelphia-based Tourism Economics, shows that in 2014 visitors to St. Clair County spent $176.3 million, up 6.4 percent from the previous year but still below spending levels in 2011 and 2012. Visitor spending included $44.4 million on food and beverage, $41.1 million on retail, $25.2 million on recreation and $20.4 million on lodging. As the Blue Water promotion has increased, so have efforts to add to or develop the area’s offerings. For example, with the popular Bell’s Beer Bayview Mackinac Race and accompanying Blue Water Fest, drawing 15,000 people, a lighted boat parade has been added on the festival’s final evening to give visitors a “reason to stay one more night” after sailboats have left Port Huron for Mackinac Island, Fogal said. And there are unique new events, such as the Blue Water SandFest, a sand-sculpting competition that began as an idea of the Friends of Fort Gratiot Light steering committee, as a way to increase the Marci Fogal: Marketing the Blue nonprofit volunteer group’s Water area. membership and raise funds for ongoing restoration work at the Fort Gratiot Light Station County Park in Port Huron. The park’s grounds along Lake Huron include the state’s oldest lighthouse and historic buildings. After researching other sand-sculpting events around the country and connecting with an event management company, SandFest launched at the park in July 2013, said Dave Brooks, chairman of the steering committee and chairman of SandFest. In its first year, the event drew 8,300 people who watched five master sculptors and seven advanced amateur sculptors shape 150 tons of trucked-in sand into freestanding works of art, raising a net $36,000 for restoration work at the park. The next year, the event landed on a USA Today list of 10 best sculpture competitions in the country, heightening visibility and contributing to the nearly 13,000 visitors who attended that year, Brooks said. The three-day event now features 14 sculptors who have come from around the country and Canada. SandFest, which this year will use around 450 tons of sand, includes demonstrations, lessons, live music,

and competitions. It has seen visitors from around the United States and other countries, and many attend more than one day, Brooks said. “The people come back day after day … they’re staying in hotels, they’re eating in restaurants. They’re seeing and doing more things than just coming to the event,” he said. And he said the raised funds — some $113,000 netted so far — are in turn propelling new restoration work that gives park visitors another reason to “come back later, and see what’s next.” Michelle Grinnell, public relations manager at Travel Michigan, said the Blue Water area is among state regions that have a large potential for tourism growth. “I would consider that one of our kind of hidden gems in the state, and there are a lot of opportunities for folks to get out and explore the area, (who) maybe haven’t in the past,” she said. Another asset is the Island Loop Route National Water Trail, Michigan’s first national water trail and one of 18 in the nation. The 10.2mile paddle route circles through the Black River, Lake Huron, under the Blue Water Bridge, into the St. Clair River and back into the Black River and Port Huron. Fogal said kayaking has become a top recreational pursuit of visitors and a focus of community efforts, including the installation in recent years of six handicapped-accessible kayak launches by the St. Clair County Parks and Recreation Commission. The Blue Water region’s kayaking has also gotten a visibility boost from the state: In 2015, a partnership between the state and Google, making select Michigan destinations accessible to potential visitors around the world via images captured using Google’s Trekker portable camera system, included the water trail. And this year, a kayaker at Turnip Rock near Huron County’s Port Austin is the cover photo of the official Pure Michigan state travel guide. Another prominent outdoor recreation element is the Blue Water River Walk — a nearly 1-mile stretch of St. Clair River shoreline in Port Huron that’s the product of a yearslong process to redevelop and restore land donated to the Community Foundation of St. Clair County by local philanthropist James Acheson. The initial gift, valued at about $1.5 million, has been leveraged to draw public and private dollars, and the River Walk is now a more than $7 million redevelopment, said Randy Maiers, president of the foundation. The river walk includes an observation deck, a pedestrian trail that’s a key link of the paved Bridge to Bay Trail envisioned from northern St. Clair County to New Baltimore, a wetlands park, a fishing pier and public art.

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SPECIAL REPORT: ST. CLAIR COUNTY

Other projects in the works in St. Clair County Port Huron this year.

n Consumers Energy Co. invested $165 million in a natural gas storage and compression station.

n Other once-vacant buildings in

downtown Port Huron are getting new attention, pushing down the vacancy rate. This includes the former headquarters of the hometown newspaper, The Times Herald, where Southfield-based Michigan Mutual Inc. is setting up shop at a cost of $3 million.

n Farther downstream on the St. Clair

River, Marine City’s downtown has become more vibrant with new shops and restaurants. Marine City Fish Co., a restaurant opened by Melissa and Jeremy Fisher in 2008, has steadily expanded and this summer will add a patio that can seat about 50 people.

nTom and Kathy Vertin have opened

two live theaters and plan to break ground this fall on a $4.19 million, 24-room hotel that also will have one floor of condos that will sell for about $300,000 each. It will be the only hotel in the southern end of the county. If people think Port Huron is an unlikely place for a mini-cultural and tourism

n Manufacturers such as

International Automotive Components and SMR Automotive Systems have expanded operations, adding jobs. Gerry Kramer, head of Port Huron-based commercial brokerage firm Kramer Realty Inc., would like to see a move away from industrial parks in favor of research parks and food processing.

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20-acre site of a former DTE Energy Co. power plant in Marysville, just south of Port Huron, that was imploded last year. There is no firm plan yet for the site on the St. Clair River, but candidates include a hotel, condominiums, a restaurant, a marina and a water park.

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renaissance, then Marine City's is even more surprising. The town was long viewed by the rest of the county’s residents as even more insular and backward than their own towns. “Five years ago, this place was dead,� said Daniel Casey, CEO of St. Clair County’s Economic Development Alliance.

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

SPECIAL REPORT: ST. CLAIR COUNTY

Blue Water area tapping into craft beer, wine culture By Amy Lane

Special to Crain’s Detroit Business

Heads up, West Michigan: The east side’s Blue Water region is claiming Michigan craft beer and wine territory. It’s something businesspeople and tourism promoters hope to grow, as part of the fabric of what the region has to offer. Take Dennis Doyle, president and founder of Port Huron-based ThumbCoast Brewing Co. When he looked at creating ThumbCoast, he wanted to put the area on the Michigan craft beer map. “What I looked at is there’s a gap in the craft beer industry on the east side of Michigan. Most everything in craft beer is on the west side or in Detroit,� said Doyle, a longtime home brewer and former auto industry executive in various marketing, finance and customer relations positions. He bought a downtown building on the Black River and renovated it to open his brewpub in May 2014, a $1 million-plus investment. Doyle expects in this year, his third, to reach his five-year goal of selling 450 barrels annually, and he’s pursuing greater growth, with plans to expand into a new location to manufacture and distribute ultimately as

COURTESY DENNIS DOYLE

Dennis Doyle aimed to put the Port

Huron area on the craft beer map when he founded ThumbCoast Brewing Co. much as 5,000 barrels annually. Pairing ThumbCoast offerings with outdoor interests — like a beer brewed for the Blue Water Sturgeon Festival, an event highlighting the ancient fish — raises brand awareness and taps into craft beer-oriented tourism potential that is “huge,� Doyle said. Take “craft beer culture, which is

kind of an art-focused, outdoorfocused, environmentally friendly group, and combine that with tourism ‌ it’s a very powerful model,â€? he said. Just ask Travel Michigan, which highlights craft beer as part of its new marketing strategy playing to people’s passions. Promotion includes a craft beer spot in the national Pure Michigan advertising campaign. “People who are passionate about craft beer, will travel for craft beer. Or will plan side trips for craft beer,â€? said Michelle Grinnell, Travel Michigan public relations manager. Kris Paul, co-owner of War Water Brewery in St. Clair, sees it every week. He and brother Kevin opened the brewery last year and are drawing patrons from the Detroit area and elsewhere, amid continued monthly sales growth, Paul said. The brothers, originally from St. Clair, opened War Water as an outgrowth of their Danny Boy Beer Works in Carmel, Ind., a location with limited production capacity, Paul said. Paul, who lives in St. Clair while Kevin lives in Carmel, said Danny Boy beer production will be moving to the St. Clair location as part of a $2.5 million expansion that will include a new taproom, full-service kitchen, and capacity to initially

produce 10,000 to 15,000 barrels annually and grow to 30,000 barrels. Also new is Harsens Island Brewery in Marysville. The brewery was founded by Brian Phinney, long a home brewer and former attorney with Foley, Baron, Metzger & Juip PLLC in Livonia, and his father, Spencer. Family history with the island dates back some 100 years; Phinney’s great-grandparents met on the Tashmoo Steamer steamship that ran between Detroit and Harsens Island, and his grandfather purchased land on the island in 1950. Infrastructure and building constrictions prevented the approximately $1 million brewery from locating on the island. But some of its beers pay homage to the area, like the Hump, named for a fishing area in Lake St. Clair, and the Tashmoo Steamer. “We kind of like to have fun with it, and to tie as much back to the island as we can,� Brian Phinney said. Wineries are also looking to be on Blue Water area tourists’ stops. The Thumbs Up Wine Trail, formed a few years ago as an effort to raise awareness of the wine industry in the Thumb and Southeast Michigan and to promote tourism, stretches about 270 miles and includes 12 wineries and wine, mead and cider offerings.

One producer is Blue Water Winery and Vineyards in Sanilac County. The winery, which has made some award-winning wines, operates a tasting room as part of its Lexington Brewing Co. and Wine House in Lexington. The wine trail brings people into town who may not have ventured there before, said Connie Currie, who with her husband, Steve Velloff, owns both operations. “Sometimes we’re the introduction to the area,� she said. Karel Bush, executive director of the Michigan Grape & Wine Industry Council, said the wine trail is “a great example of people working together� to build winery visitors and sales. At Green Barn Winery in St. Clair County’s Smiths Creek, business has grown steadily since its 2012 opening, said Becky Wrubel, who with her husband, Mike, owns the winery. In addition to producing its own wines, Green Barn will make wine for customers who bring in fruit. Wrubel said visitors passing through the area are sometimes surprised to find a winery. “They think you can’t grow grapes in this side of the state,� she said. “They think you can only grow grapes in Traverse City. We’ve proved them wrong.�

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

15

SPECIAL REPORT: ST. CLAIR COUNTY

Convention center expected to help boost tourism By Amy Lane

Special to Crain’s Detroit Business

Beyond natural escapes are brick-and-mortar developments that feed into the St. Clair County tourism picture. The $9 million, more than 34,000-square-foot Blue Water Convention Center, opened in 2015, will build convention business and also leisure travel, drawing people who may return at a later date, said Jeff Bohm, chairman of the St. Clair County Board of Commissioners. He is also co-chairman of Blue Meets Green, a collaborative effort to enhance community quality of life and economic prosperity in the region. The convention center is an important element “to expose people to your area that have never been here,” Bohm said. And he said it is expected to push up hotel occupancy and lead to more demand for hotel rooms and building of new stock. Tied to the county’s convention center development on the St. Clair River was the $11 million renovation of the Thomas Edison Inn, into a DoubleTree by Hilton hotel connected to the center and operating the new Freighters Eatery and Taproom restaurant. Ahead for Port Huron is a new

“If we do it right, and we certainly plan to, it’ll become a destination for the state of Michigan, and hopefully beyond that.” Jeff Katofsky, renovating historic St. Clair Inn CityFlats hotel, planned to go into a former Michigan National Bank building and join other CityFlats-brand hotels in Grand Rapids and Holland. Developer and West Michigan businessman Chuck Reid is also redeveloping the former downtown Sperry’s department store into 12 small theaters and commercial space. And in St. Clair, much-anticipated new life is coming to the historic St. Clair Inn. California attorney and developer Jeff Katofsky, managing member of inn owner Planet Clair LLC, has plans to renovate the inn, “respecting its historical nature but updating it today as far as technology and comfort. Which is really hard,” he said. Katofsky’s plans for the inn in-

clude upgrades for 90-plus guest rooms, outdoor facilities along the river for weddings and events, and dining operations, accompanied across the street by shops, a gym and 40-45 extended-stay rooms. At finish of his approximately $40 million redevelopment, Katofsky envisions a “higher-end retreat, a getaway place” that will be marketed to Michigan, Ohio, Illinois and other areas. “If we do it right, and we certainly plan to, it’ll become a destination for the state of Michigan, and hopefully beyond that,” he said. “It’s going to be, I think, one of the premier places in the state to go and relax for the weekend, or have a party."

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

SPECIAL REPORT: ST. CLAIR COUNTY

PAUL VACHON

Six lofts, retail and theatrical space are the plan for The Citadel Loft and Theater Building on Huron Avenue in Port Huron.

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Loft, condo projects lift Port Huron’s housing options By Paul Vachon

Special to Crain’s Detroit Business

A number of loft and condominium projects — including building rehabs and new construction — are bringing more than 140 units of new housing to Port Huron. The first trend was small-scale projects composed of stylish new lofts and created for those who seek an urban lifestyle in a community that can still boast a small-town feel. Larry Jones, CEO of Maritime Construction, sees his compa- Larry Jones: ny’s role as a cat- Builder wants to alyst in this reverse trends. transformation. “Once you get your city’s central core built out, it creates a market for the nearby restaurants and entertainment,” he said. “So what we’re doing is reversing past trends, when suburban shopping and movie theaters sucked the life out of downtown.”

One of his projects is the J.J. Newberry Lofts at 230 Huron Ave. Named

after the discount retailer that once occupied the structure, the Newberry is an example of a reuse of a historic property. Eight units of different configurations occupy the upper floors and offer high-end finishes like stainless steel kitchen appliances and granite countertops — but also a surprise. In each unit, the kitchen island is topped with wood salvaged from the lanes of a former bowling alley, refinished to offer a smooth surface, but with a clear coat that reveals its original nicks and scratches. The roughness plays off against the exposed brick and ductwork. Because the work is partially financed with Federal Historic Preservation Tax Credits, (the building is part of the Military Road Historic District), Jones had to secure approval for the replacement windows he used to assure their fidelity to the original architecture. Each of the one-bedroom units will rent from SEE RESIDENTIAL, PAGE 17

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SPECIAL REPORT: ST. CLAIR COUNTY

RESIDENTIAL FROM PAGE 16

$700 to $800 per month. Another new project is the Citadel Loft and Theater Building at 609 Huron Ave. Originally constructed as a worship space by the Salvation Army in 1903, the building in recent decades has housed various retail stores. Local developers Dave and Georgina Witt purchased the building in early 2015 and are renovating it into a mixed-use site, with retail on the ground floor, six two-story lofts on the second and third floors and a simple theatrical space in the rear. When initially acquiring the building, the Witts used a $3,500 grant from the St. Clair County Brownfield Redevelopment Authority to do an environmental assessment. The Citadel is the latest in a chain of developments the Witts have completed in Port Huron. Others include another rehab project, the Bens Luxury Lofts (eight units); the Arashi, a newly constructed building with 11 units; and five commercial spaces plus others, which collectively number 40 residential spaces and 13 commercial. Price points hover around $100,000, enough to make the project profitable and to encourage reinvestment among the developers. Most buyers tend to be recent college graduates working at their first jobs.

PAUL VACHON

The waterfront Bluewater View Luxury Condominiums project is slated to begin construction late this year or early in 2017. The tipping point toward attracting more new construction, largescale projects appear to have arrived. Recently, New York developer and Port Huron native Allen Stevens announced an ambitious plan for the Bluewater View Luxury Condominiums, a project slated for a waterfront site once occupied by a YMCA. In May, the Port Huron City Council approved the sale of the land, and some adjacent parcels, to Stevens for about $1 million after a previous developer was unable to secure financing. Stevens expects to begin construction late this year or early in 2017. Preliminary renderings call for two ultra-modern high-rise towers facing the water, but flanking each other at a slight angle. Walls contain a considerable amount of glass to

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maximize the view of Lake Huron, the St. Clair River and Sarnia, Ontario, for the 80 units of housing. The building will be eight to 10 stories, though the final plans are still being worked out. Broker Gerry Kramer, who has been doing commercial real estate in Port Huron since 1975, said high-rise living is a long-deferred market. Port Huron’s skyline to date lacks residential buildings of noticeable size, whereas buildings of at least 10 stories line the view of Sarnia, Ontario, across the river. Despite being in the early stages, just the announcement of such a major development represents a huge step for Port Huron. For years, city leaders have expressed puzzlement as to the absence of high-rise housing. David Haynes, Port Huron’s director of planning and community development, offers a theory as to why. “Once a building exceeds a certain height, concrete and steel is required, increasing costs exponentially. Low-rise projects are also more easily scalable, and can be phased as market conditions warrant.� Most significantly, interest in Stevens’ project represents a maturation of the local housing market. “We see this as the next step in Port Huron’s housing scene,� said James Freed, Port Huron’s city manager. “Although new waterfront development is in its early stages, the investors’ confidence is demonstrated by their willingness to commit to the projects despite clauses in the development agreements that will penalize them if they buy the land but don’t go through with construction.� City leaders point out that Port Huron now benefits from a fairly diversified economy, which is essential in avoiding the familiar, but often calamitous, boom-and-bust cycle. Area workers are employed in a variety of industries, including tier-one automotive, agriculture, transportation and education, creating a sustainable economic base. Port Huron is also home to a number of successful professionals who commute to the Detroit area, further fueling the demand for quality local housing. “When you have a place that endured such hardship for so long, and land became so undervalued, it creates greater future opportunity,� Freed said. “This opportunity gap allows for a more robust recovery when the market eventually revives.�

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18

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

SPECIAL REPORT: CRAIN’S MICHIGAN BUSINESS

Outgoing Grand Valley AD: Division II is the right place By Bill Shea bshea@crain.com

Tim Selgo will retire next month after 20 years as Grand Valley State University’s athletics director, and part of his legacy will be a consistent message during those two decades: Keep the Lakers a Division II program. GVSU, which is near Grand Rapids, has had quite a bit of on-field success under Selgo, including 18 national championships in five of its 20 sports. That has fueled ques-

tions and pressure at times for the 25,000-student university to make the transition to Division I. Selgo, 58, has opposed such a move since being hired in 1996, and in February he gave the university’s board of regents a final presentation outlining his logic. Namely, it’s about money. GVSU spends about $11 million, or less than 2 percent of the university’s overall budget, annually on athletics. To move up to the Mid-American Conference with Eastern, Western

and Central Michigan universities, would mean students would be tapped for an increase of at least $20 million more annually for the athletics budget. And schools in the Big Ten Conference have budgets well past $100 million. “Why would we want to spend three times the amount of money we’re spending now, and tax our students to do so in this age of high tuitions, for what? Who’s getting better publicity with their athletics program, Grand Valley or Eastern Mich-

igan?� he said. The brief moments in the Division I spotlight aren’t worth it, Selgo said. “We make an NCAA tournament once every 10 years, all of Tim Selgo: 20 our alums get exyears at Grand cited because Valley State. we’re in the national news. Then we get beat by 30

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points and it fades away, � he said. Selgo was a basketball player at the University of Toledo, a Division I MAC school, in the 1980s. Because of that, there was an assumption among some that he’d want to move Grand Valley to that level. “When I came to Grand Valley in ’96, I got that question all the time. They figured this guy is coming from the MAC, coming from Toledo, he’s going to take us to D-1,� he said. “I came in with the exact opposite message. ... “I knew we could be better and we could compete nationally. I knew in the MAC you can’t. Sixty years of history, 80 years of history has told us. I played in the Sweet 16 at Toledo and I’m a proud graduate, but we had no chance. We were in the same regional as Notre Dame who then got beat by Michigan State and Magic Johnson. We’re not going to beat those guys. So I came to Grand Rapids and got hammered with that question.� These days, the D-1 question pops up only about once a year, thanks to Selgo’s two decades of proselytizing the advantages of Division II for Grand Valley. That evangelism includes a long paper he wrote in 2014 outlining his philosophy that’s posted on his official GVSU website biography. “Why would you charge your students more money to get less recognition and less success for your student athletes?� he said. “All of those schools in the MAC have dropped sports in their ever-reaching quest to be Division I. I don’t think that’s what college sports is about.� Selgo also said moving up to the Division I Football Championship Subdivision (FCS), formerly known as Division I-AA, is a bad idea. “That’s not a good option for Grand Valley at all. ... The only schools in our region that play at that level are Eastern Illinois, Youngstown State, Western Illinois, Illinois State and no one around Grand Valley or Grand Rapids is going to care about that,� he said. Academics is another reason to say Division II, according to Selgo. “We’ve just built a $70 million library. My argument is if we were Division I, a lot of that wouldn’t have happened. I guarantee you we wouldn’t have a $70 million library if we were Division I because we’d have to build a $70 million football stadium. “ Selgo, the current president of the

3/16

athletic director at Toledo prior to coming to GVSU. His retirement plan is to do some college athletics consulting, and teach athletics leadership in sports governance at Davenport University’s sports management program. He also plans to visit Europe this summer, and travel in the fall to see college football games around the country — for enjoyment. Bill Shea: (313) 446-1626 Twitter: @Bill_Shea19

19

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

SPECIAL REPORT: SECOND STAGE

Opting for apps How to know if one is right for your business Stories by Rachelle Damico / Special to Crain's Detroit Business

Mobile apps are becoming more and more important as business tools. Small, second-stage and large companies are experimenting with mobile apps as a way to gain new customers, increase productivity and even train new employees. “Providing employees with technology will help them do their job more efficiently and perhaps even with some more incentive,” said Meg Roberts, president of Ann-Arbor based franchise Molly Maid Inc. Wendy LoCicero, marketing manager for Livonia-based nonprofit American Society of Employers, said mobile apps are an innovative way business owners can attract new customers. “Everyone has a smartphone and uses mobile apps,” LoCicero said. “It’s an easy way to engage.”

Paul Anglin, vice president of Clinton Township-based company IDC Industries Inc., uses a mobile app to streamline its manufacturing process. “It cut down time, helped train new and existing employees and increased productivity,” he said. This month, we talked to three organizations — a small nonprofit, a second-stage company and a large franchisor — about why they chose a mobile app, what the costs were and how they went about vetting vendors.

Read their stories Molly Maid app rewards employees, This page IDC amps up productivity with teardown app. Page 20 ASE reaches out to members with app. Page 21

Molly Maid tests app in effort to retain, reward employees

C

ustomers are only one potential audience for a company’s mobile app. Meg Roberts, president of Ann Arbor-based home cleaning franchise Molly Maid Inc., approached her franchise advisory council last year about using a mobile app to help decrease employee turnover. “I think a lot of minimum-wage jobs in the service industry are having trouble hiring and retaining people,” she said. “We need to retain those precious employees longer — they’re harder to find and they’re harder to keep.” Molly Maid has 450 franchisees nationwide. It is the second-largest franchise brand of Texas-based parent company Dwyer Group Inc.

Roberts said the franchise tends to lose employees within the first four to eight weeks of their hiring. She believed a rewards-based app would be a way to engage and maintain its mostly millennial employee base. Team members at Molly Maid created a project plan for the app that listed objectives, goals, budget and timing. Then they began to vet vendors. “I would hope anyone who’s vetting a vendor for something that’s both marketing- and technology-related has an employee on staff with technology expertise and a marketing leader working in tandem,” Roberts said. The company chose Indiana-based Bluebridge Digital LLC because it was cost-effective and could be customized for specific franchisee needs. Cost was low because the app didn’t have to be built from scratch and instead is built upon the vendor’s custom framework. “It can be pretty expensive to build an app from the ground up,” Roberts said. The app cost about $10,000 to customize, which Roberts said allowed Molly Maid to pi-

lot a program without making a six-figure investment for an app that is still being tested. Franchisees will pay $150 to $200 to use it, depending how many employees they have. “We look at that and say, ‘How much does it cost for our franchisee to hire an employee and how much business does it lose if they’re short on employees?’ ” Roberts said. “Easily a franchisee will say it will cost more to find a new employee every month.” The mobile app will allow Molly Maid employees to receive rewards for participating in training sessions delivered through the app. “They might not sit down and read a training manual, but they will very likely watch a quick 15-second video that reminds them of proper safety or training,” Roberts said. The app also has social capabilities, such as checking in with fellow employees, sharing information or giving shout-outs to employees who did a good job. Employees may get a monetary or recognized award — such as a bonus, scholarship drawing, or a pizza party — for doing well or posting the most positive comments about co-workers. Local Molly Maid business owners can use the app to poll employees to see what type of reward they prefer. The mobile app will launch in July and will be tested for six months among 10 Molly Maid locations that range from 10-100 employees to measure results and determine how successful the app will be. “Consider how important it is to make sure your employees are happy,” Roberts said. “When you’re thinking about where an app makes sense for your business, don’t only think of your customer as the absolute end user, but think about the other people along the way who helped facilitate the growth and success of your business.”

Meg Roberts, president of Molly Maid Inc., in her Ann Arbor office. PHOTO BY LON HORWEDEL

20

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

SPECIAL REPORT: SECOND STAGE

IDC Industries uses app to increase productivity, train employees By Rachelle Damico

Special to Crain's Detroit Business

Clinton Township-based IDC Industries Inc. wanted a more efficient

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way to process reports and train employees. “I wanted to move my company further ahead of our competitors,” said Paul Anglin, vice president of IDC. The company, which was founded in 1968 and has 50 employees, manufactures and repairs industrial gearboxes, which provide power to conveyors for mining, steel and cement machinery. Technicians previously handwrote reports on product teardowns — when gearboxes are disassembled to see what’s preventing them from working. “We were using the old pen-andpaper process, and that could be difficult if a technician has bad handwriting or they forgot to note something on the report,” Anglin said. Anglin believed an app could better assist repair technicians to ensure parts were accounted for, repairs were properly documented and reports were generated promptly. After tapping a networking contact for vendor recommendations, he hired Detroit-based

Detroit Labs LLC.

He met with the vendor and liked that it came to see how IDC tore down equipment and explained how a mobile app could expedite the process. The vendor built an app that walks technicians through the teardown process step-by-step and will not allow the user to continue until each step is completed. It also helps train new employees and eliminates issues like unreadable penmanship or incomplete information because the app forces users to finish a task or step before submitting a report. “It increases productivity and is a much faster training time for employees to get them up to speed,” Anglin said. The application cost $140,000 to have built, but Anglin said it is already paying back the investment in time saved. “I would say it’s averaging us probably two or three days of cutting down time” off the previous six days it took to do a teardown, he said. “I’ll probably have a payback on that app in three to four years.” Anglin and his staff discussed with the vendor how to integrate

the app into the company. The app took about three to four weeks to build, from conversation to development. Technicians interact with the application using an iPad. Anglin said that at first some technicians resisted because they worried an iPad on the shop floor would get dirty or broken. “Once they interacted with the app, all of our office and engineering were on board,” Anglin said. “It puts us on the technological forefront and gives us a much more consistent, better-quality report.” Anglin said the positive experience has led him to work with the vendor again. Detroit Labs is currently customizing a subscription-based app that allows customers to submit job requests directly to IDC. The app will be customized with IDC branding, for which the company will pay a monthly service fee rather than paying to develop a full mobile app from scratch. “That will really set us far apart from the competition, who as of now aren’t even thinking of this,” Anglin said. “We’re investing from a quality standpoint in getting better.”

21

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

SPECIAL REPORT: SECOND STAGE

ASE sought to liven up conferences By Rachelle Damico

Special to Crain's Detroit Business

The American Society of Employers wanted a new way to attract audiences during its four yearly conferences, which about 600 business leaders attend every year. The Livonia-based nonprofit, which helps Southeast Michigan employers with human resource needs, has more than 80 Michigan-based companies in its membership, including Ford Motor Co. and Henry Ford Health System. Wendy LoCicero, marketing manager, believed ASE needed a mobile app to help engage members and allow them to easily share information with each other during conferences. “It’s moving us forward into the 21st century,” LoCicero said. “Everyone has a cellphone and uses apps.” ASE wanted the app to have social networking and gaming capabilities so attendees could talk to each other within the app and be able to receive points for attending different parts of the conference. The app would also allow members to engage in live polling and access speaker profiles and conference agendas. “Human resource topics can sometimes be pretty straitlaced, so it’s a fun way to get people pretty active,” LoCicero said. ASE decided the most cost-effec-

tive, timely approach would be to find a vendor that already had a customizable app created and ready to use. “It didn’t make sense for us to have one built,” LoCicero said. “We had a short window, and it was going to take a lot longer if we were to build it and then hire an engineer.” LoCicero vetted five vendors by searching the internet and tapping networking contacts. The staff and LoCicero then sat down with vendors and interviewed them. The company hired San Francisco-based Mission Team Players LLC, which does business as Double Dutch, because the app was customizable and encompassed other features, including document hosting and the ability for conference attendees to rate speakers and ask questions during a conference. “The features they had were more robust and their management system was easy to use,” LoCicero said. She said that initially some ASE staff disagreed about having a mobile app because they thought ASE members would not use it. “We’re an old organization, and very conservative, so we’re usually pretty slow to make big changes,” LoCicero said. “But the other side argued it shows we’re moving forward, looking to the future and us-

ing technology to do that.” The app is subscription-based and is priced according to the number of conference attendees — $5,000 for larger events (about 200 attendees) and $2,500 for smaller events (about 150 people). Altogether, the application cost ASE about $12,500. LoCicero said the app was well received by the 480 conference attendees — 302 downloaded the application and 269 used the application consistently throughout the conference. “An event is only one day, so we weren’t sure how engaged we could get people, but we were really happy to see so many people downloaded it,” she said. Due to its success, ASE plans to work with a vendor again to release an app that will be accessible yearround to members and nonmembers to promote other services and draw in members. LoCicero said business owners could benefit from hiring a vendor to create a mobile app because it could help attract customers. Similar to ASE, business owners could get their feet wet to see if they are attracting an audience. “You have to evaluate if it makes sense for your business — not just because everyone’s doing it,” LoCicero said. “Find out if customers are going to actually want to use and engage with it.”

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C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

CRAIN'S LIST: SE MICHIGAN PUBLICLY HELD COMPANIES

Ranked by 2015 revenue Rank

1 2 3 4 5 6 7 8

Revenue ($000,000) 2015

Revenue ($000,000) 2014

Percent change

Net income ($000,000) 2015/2014

Exchange/ Ticker symbol

Stock price 52-week high/low

Mary Barra CEO and chairman

$152,356.0

$155,929.0

-2.3%

$9,687.0 $2,804.0

NYSE GM

$36.88 $24.62

Automobile manufacturer

Ford Motor Co. (12/2015) (313) 322-3000; www.ford.com

Mark Fields president and CEO

149,558.0

144,077.0

3.8

625.0 3,186.0

NYSE F

15.51 10.22

Automobile manufacturer

Penske Automotive Group Inc. (12/2015) (248) 648-2500; www.penskeautomotive.com

Roger Penske CEO

19,284.9

17,177.2

12.3

326.1 286.7

NYSE PAG

54.39 29.41

Automobile dealerships

Lear Corp. (12/2015) (248) 447-1500; www.lear.com

Matthew Simoncini president and CEO

18,211.4

17,727.3

2.7

745.5 672.4

NYSE LEA

127.00 89.71

Automotive supplier

Delphi Automotive plc (12/2015) (248) 813-2000; www.delphi.com

Kevin Clark CEO and president

15,165.0 B

17,023.0

-10.9

1,535.0 1,440.0

NYSE DLPH

90.57 55.59

Automotive supplier

DTE Energy Co. (12/2015) (800) 235-8000; www.dteenergy.com

Gerard Anderson chairman and CEO

10,337.0

12,301.0

-16.0

720.0 911.0

NYSE DTE

94.23 73.23

Energy company

Ally Financial Inc. (12/2015) (877) 247-2559; www.ally.com

Jeffrey Brown CEO

9,539.0

9,667.0

-1.3

1,289.0 1,150.0

NYSE ALLY

23.83 14.55

Financial holding company

BorgWarner Inc. (12/2015) (248) 754-9200; www.borgwarner.com

James Verrier president and CEO

8,023.2

8,305.1

-3.4

609.7 655.8

NYSE BWA

61.41 27.68

Automotive supplier

Federal-Mogul Holdings Corp. (12/2015) (248) 354-7700; www.federalmogul.com

Rainer Jueckstock, co-CEO, co-chairman and CEO, Powertrain; Daniel Ninivaggi, co-CEO, co-chairman and CEO, Motorparts Keith Allman president and CEO

7,419.0

7,317.0

1.4

(110.0) (168.0)

Nasdaq FDML

12.68 3.81

Automotive supplier

7,142.0

8,521.0

-16.2

355.0 856.0

NYSE MAS

32.92 22.52

Building products

6,456.0

7,179.0

-10.1

523.0 477.0

NYSE CMS

43.44 31.22

Energy

Kelly Services Inc. (12/2015) (248) 362-4444; www.kellyservices.com

John Russell chairman, president and CEO Carl Camden president and CEO

5,518.2

5,562.7

-0.8

53.8 23.7

Nasdaq KELYA

20.15 13.47

Staffing services

American Axle & Manufacturing Holdings Inc. (12/2015) (313) 758-2000; www.aam.com

David Dauch chairman and CEO

3,903.1

3,696.0

5.6

235.6 143.0

NYSE AXL

23.00 11.44

Automotive supplier

Meritor Inc. (9/2015) (248) 435-1000; www.meritor.com

Jeffrey Craig president and CEO

3,505.0

3,766.0

-6.9

64.0 249.0

NYSE MTOR

14.42 5.69

Diplomat Pharmacy Inc. (12/2015) (888) 720-4450; diplomatpharmacy.com

Phil Hagerman chairman and CEO

3,366.6

2,215.0

52.0

25.8 4.8

NYSE DPLO

52.33 22.41

Commercial vehicle, heavy duty truck and defense supplier Drug retail

Cooper-Standard Holdings Inc. (12/2015) (248) 596-5900; www.cooperstandard.com

Jeffrey Edwards chairman, president and CEO Sachin Lawande CEO

3,342.8

3,244.0

3.0

111.9 42.8

NYSE CPS

86.61 54.03

Automotive supplier

3,245.0

7,509.0

-56.8

2.3 (295.0)

NYSE VC

81.04 55.09

Automotive supplier

3,047.3

3,144.0

-3.1

125.7 73.3

NYSE MPG

24.62 10.87

Automotive supplier

Domino's Pizza Inc. (12/2015) (734) 930-3030; www.dominos.com

George Thanopoulos, CEO; Douglas Grimm, president and COO Patrick Doyle president and CEO

2,216.5

1,993.8

11.2

192.8 162.6

NYSE DPZ

140.80 99.00

Restaurant franchisor

Tower International Inc. (12/2015) (248) 675-6000; www.towerinternational.com

Mark Malcolm president and CEO

1,955.7

2,067.8

-5.4

194.1 21.5

NYSE TOWR

31.41 19.36

Automotive supplier

Universal Logistics Holdings Inc. C (12/2015) (586) 920-0100; www.goutsi.com

Jeff Rogers CEO

1,128.8

1,191.5

-5.3

40.0 45.4

Nasdaq ULH

22.72 11.12

Transportation

ITC Holdings Corp. D (12/2015) (248) 946-3000; www.itc-holdings.com

Joseph Welch chairman, president and CEO Bharat Desai, chairman; Nitin Rakesh, CEO and president David Wathen president and CEO

1,044.8

1,023.0

2.1

242.4 244.1

NYSE ITC

46.00 30.33

Utility - electricity transmission

968.6

911.4

6.3

252.5 249.7

Nasdaq SYNT

50.92 41.07

Information technology

864.0 E

1,499.1

-42.4

(33.4) 69.3

NASDAQ TRS

25.35 14.76

Manufacturing conglomerate

Company Fiscal year end; website

Top executive(s)

General Motors Co. (12/2015) (313) 556-5000; www.gm.com

9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32

Masco Corp. (12/2015) (313) 274-7400; www.masco.com CMS Energy Corp. (12/2015) (800) 477-5050; www.cmsenergy.com

Visteon Corp. (12/2015) (734) 710-5000; www.visteon.com Metaldyne Performance Group Inc. (12/2015) (248) 727-1829; www.mpgdriven.com

Syntel Inc. (12/2015) (248) 619-2800; www.syntelinc.com TriMas Corp. (12/2015) (248) 631-5450; www.trimascorp.com

Type of industry

Daniel Coker president and CEO

856.4

811.3

5.6

95.4 70.1

Nasdaq THRM

57.95 34.09

Thermal technology

(248) 504-0500; www.gentherm.com Credit Acceptance Corp. (12/2015) (248) 353-2700; www.creditacceptance.com

Brett Roberts CEO

825.3

723.5

14.1

299.7 266.2

Nasdaq CACC

277.98 159.43

Financial institution

Flagstar Bancorp Inc. (12/2015) (248) 312-2000; www.flagstar.com

Alessandro DiNello president and CEO

825.0

646.6

27.6

158.0 (69.5)

NYSE FBC

25.05 17.25

Financial institution

Superior Industries International Inc. (12/2015) (248) 352-7300; www.supind.com

Don Stebbins CEO

727.9

745.4

-2.3

23.9 8.8

NYSE SUP

27.90 16.35

Automotive supplier

Sun Communities Inc. (12/2015) (248) 208-2500; www.suncommunities.com

Gary Shiffman chairman and CEO

674.7

471.7

43.0

137.3 22.4

NYSE SUI

73.37 61.17

Real estate

Horizon Global Corp. F (12/2015) (248) 593-8810; www.horizonglobal.com

Mark Zeffiro president and CEO

575.5

612.0

-6.0

8.3 15.4

NYSE HZN

16.25 8.04

Towing, cargo management

Taubman Centers Inc. (12/2015) (248) 258-6800; www.taubman.com

Robert Taubman chairman, president and CEO Thomas Merk CEO and president H

557.2

679.1

-18.0

192.6 1,278.1

NYSE TCO

79.74 63.32

Retail real estate investment trust

519.6

530.1

-2.0

41.3 25.2

Nasdaq RSTI

32.50 19.02

Laser-based products

Gentherm Inc. (12/2015)

Rofin-Sinar Technologies Inc. G (9/2015) (734) 455-5400; www.rofin.com

This list of publicly held companies is a compilation of the largest companies in Wayne, Oakland, Macomb, Washtenaw and Livingston counties that have stock traded on a public exchange. 52-week highs and lows are for period ending Dec. 4, 2015. Information is from SEC filings.

B Completed the sale of the wholly owned Thermal Systems business to MAHLE GmbH on June 30, 2015. C Formerly Universal Truckload Services Inc. Shareholders approved the name change in April, and the company began trading under the new name and ticker symbol, ULH, on May 2. D Fortis Inc. (Canada) has agreed to buy ITC Holdings Corp. ITC will continue as a stand-alone transmission company. E On June 30, 2015, spun off Cequent businesses, creating a new independent publicly traded company, Horizon Global Corp. F TriMas Corp. spun off its Cequent set of businesses on June 30, 2015, to form Horizon Global Corp. G Entered into a merger agreement in March to be acquired by Coherent Inc., Santa Clara, Calif. The transaction is expected to close this year. H Effective July 1, 2015. Succeeded Gunther Braun as CEO. LIST RESEARCHED BY CRAIN'S STAFF, SONYA D. HILL

23

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

CRAIN'S LIST: TOP-COMPENSATED CEOS

Ranked by fiscal 2015 compensation Rank

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Total compensation 2015/2014

Salary 2015/2014

Bonus 2015/2014

Stock awards 2015/2014

Nonequity incentive/ retirement 2015/2014

Other compensation 2015/2014

Option awards 2015/2014

Company's net income 2015/2014

Mary Barra General Motors Co.

$28,588,663 $16,162,828

$1,750,000 $1,567,803

$0 $0

$12,000,004 $11,760,567

$3,074,512 $2,421,926

$597,118 $412,532

$11,167,029 $0

$9,687,000,000 $2,804,000,000

Mark Fields Ford Motor Co.

18,576,946 18,596,497

1,750,000 1,662,500

0 0

12,133,338 3,412,489

4,323,157 6,832,336

370,451 439,178

0 6,249,994

625,000,000 3,186,000,000

James Verrier BorgWarner Inc.

17,420,632 10,005,230

1,150,000 967,500

0 0

12,136,267 5,872,638

3,458,301 2,637,175

676,064 527,917

0 0

609,700,000 655,800,000

Matthew Simoncini Lear Corp.

13,612,393 12,174,443

1,306,125 1,290,000

0 0

8,149,840 7,099,775

3,487,680 3,230,217

668,748 554,451

0 0

745,500,000 672,400,000

David Dauch American Axle & Manufacturing Holdings Inc.

13,215,216 9,349,318

1,150,000 1,100,000

0 0

5,348,595 4,454,330

6,649,490 3,719,799

67,131 75,189

0 0

235,600,000 143,000,000

Alessandro DiNello Flagstar Bancorp Inc.

13,018,426 2,417,170

1,552,500 1,495,000

0 0

11,226,400 600,000

0 0

239,526 322,170

0 0

158,000,000 (69,465,000)

Kevin Clark Delphi Automotive plc

12,196,319 6,576,067

1,066,667 825,000

500,000 500,000

9,112,214 3,938,805

1,353,000 1,180,875

164,438 131,387

0 0

1,535,000,000 1,440,000,000

Sachin Lawande Visteon Corp.

11,245,493 0

507,576 0

3,250,000 0

5,845,106 0

921,387 0

84,453 0

636,971 0

2,284,000 (295,000,000)

Joseph Welch ITC Holdings Corp. B

11,106,371 16,355,598

1,027,336 1,012,182

976,180 2,314,262

1,843,228 1,862,578

6,034,832 10,015,213

377,529 375,715

847,266 775,648

242,406,000 244,083,000

John Russell CMS Energy Corp.

10,297,766 11,451,273

1,200,000 1,110,000

0 0

5,106,998 3,618,055

3,941,383 6,677,333

49,385 45,885

0 0

523,000,000 477,000,000

Gerard Anderson DTE Energy Co.

10,174,183 12,604,355

1,268,269 1,243,269

0 0

6,299,250 6,149,900

2,472,414 5,083,351

134,250 127,835

0 0

720,000,000 911,000,000

Patrick Doyle Domino's Pizza Inc.

8,977,413 7,453,021

965,385 915,481

0 0

2,894,463 2,159,554

2,669,550 2,255,150

400,489 457,672

2,047,526 1,665,164

192,789,000 162,600,000

Jeffrey Brown Ally Financial Inc.

8,483,540 4,429,242

924,992 600,000

1,649,425 0

5,876,445 3,797,892

0 0

32,678 31,350

0 0

1,289,000,000 1,150,000,000

Keith Allman Masco Corp.

8,342,419 4,750,833

998,461 842,788

0 0

2,376,001 584,229

3,051,000 1,858,628

321,407 178,638

1,595,550 1,286,550

355,000,000 856,000,000

Rob Chioini Rockwell Medical Inc.

7,854,733 8,511,639

847,584 706,320

805,205 635,688

2,674,750 2,786,000

0 0

22,566 20,131

3,504,628 4,363,500

(14,420,450) (21,327,157)

Name Company

Top compensation for CEOs at publicly held companies in Wayne, Oakland, Macomb, Washtenaw and Livingston counties. Incentive plan/retirement column is total of nonequity incentive-plan compensation, nonqualified deferred compensation and change in pension value. NA = not available.

B Fortis Inc. (Canada) has agreed to buy ITC Holdings Corp. ITC will continue as a stand-alone transmission company. LIST RESEARCHED BY BRIDGET VIS AND SONYA D. HILL

CRAIN'S LIST: TOP-COMPENSATED NON-CEO EXECUTIVES

Ranked by fiscal 2015 compensation

Total compensation 2015/2014

Salary 2015/2014

Bonus 2015/2014

Stock awards 2015/2014

Nonequity incentive/ retirement 2015/2014

Other compensation 2015/2014

Option awards 2015/2014

1

Thomas Amato B former co-president of MPG, and president and CEO of Metaldyne Metaldyne Performance Group Inc.

$14,529,280 $4,588,063

$750,000 $658,539

$0 $0

$6,514,629 $2,000,010

$731,250 $825,000

$1,223,303 $32,185

$5,310,098 $1,072,329

2

William Clay Ford Jr. executive chairman and president Ford Motor Co. and William and Lisa Ford Foundation

12,860,840 15,110,695

2,000,000 2,000,000

0 0

7,077,764 4,777,493

2,366,677 5,337,336

1,416,399 1,245,870

0 1,749,996

3

Daniel Ammann president General Motors Co.

11,800,077 8,489,346

1,200,000 990,530

0 0

4,500,021 6,310,564

1,650,000 925,000

262,420 263,252

4,187,636 0

4

Majdi Abulaban senior VP and president, Delphi electrical/electronic architecture and Delphi Asia Pacific Delphi Automotive plc

10,385,429 3,681,517

630,000 621,250

0 0

8,489,540 1,424,843

431,047 693,874

834,842 941,550

0 0

5

Mark Reuss executive VP, global product development, purchasing and supply chain General Motors Co.

10,199,136 9,477,777

1,100,000 846,212

0 0

3,825,012 7,458,881

1,515,000 1,061,888

199,629 110,796

3,559,495 0

6

Martin Thall C former executive VP and president, electronics product group Visteon Corp.

9,876,896 2,086,106

304,183 595,000

0 0

0 0

6,226,817 690,200

3,345,896 800,906

0 0

7

Craig B. Glidden executive VP and general counsel General Motors Co.

8,439,819 0

583,333 NA

500,000 NA

4,475,042 NA

945,000 NA

145,064 NA

1,791,380 NA

8

Charles K. Stevens, III executive VP and CFO General Motors Co.

8,102,224 4,894,832

1,000,000 691,667

0 0

2,875,049 3,177,354

1,375,000 912,701

176,738 113,110

2,675,437 0

9

Liam Butterworth senior VP and president, Powertrain Systems Delphi Automotive plc

7,241,243 0

553,852 NA

577,200 NA

5,525,333 NA

464,860 NA

119,998 NA

0 NA

Jugal K. Vijayvargiya senior VP and president, electronics and safety Delphi Automotive plc

6,823,617 0

495,833 NA

0 NA

5,525,333 NA

153,510 NA

648,941 NA

0 NA

Rank

10

Name Company

Top compensation for non-CEO executives at publicly held companies in Wayne, Oakland, Macomb, Washtenaw and Livingston counties. Incentive plan/retirement column is total of nonequity incentive-plan compensation, nonqualified deferred compensation and change in pension value. NA = not available.

B Stepped down as co-president at the end of 2015. C Left the company June 28, 2015. LIST RESEARCHED BY BRIDGET VIS AND SONYA D. HILL

24

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

DEALS & DETAILS CONTRACTS

Medical Advantage Group, Ann Arbor, a provider of health care consulting services for physicians, announced its relationship with Live Compliance LLC, Tampa, Fla., which specializes in HIPAA Omnibus regulations and training, to leverage the Live Compliance program, portal and partnerships as part of its HIPAA consulting services. Websites: medicaladvantagegroup.com, livecompliance.com. Single Source Technologies, Auburn

Hills, a distributer of machinery

brands, tooling and EDM supplies, announced an agreement with Synova, Lausanne, Switzerland, a manufacturer of three- and five-axis laser cutting systems that incorporate Laser MicroJet, to distribute the MicroJet machines. Websites: singlesourcetech.com, synova.ch.

EXPANSIONS

Magna International Inc., Troy, a

manufacturer of automotive body, chassis and engineering, is opening a 225,000-square-foot facility in Telford, U.K., to support Jaguar Land Rover manufacture. Website: magna.com.

Great Expressions Dental Centers PC,

Southfield, a dental service organization, has expanded its footprint in Florida to 150 offices

through the affiliation with Your Gentle Dentist in the age-restricted communities of The Villages. Website: greatexpressions.com.

NEW PRODUCTS

GKN Driveline, Auburn Hills, part of GKN plc, announced a series of new

C-Segment vehicles, which will offer the option of plug-in electric all-wheel drive using its electric axle drive technology. Website: gkn.com. Altair Engineering Inc., Troy, released the latest HyperWorks 14.0 Student Edition, a computer-aided engineering suite available to aspiring structural and mechanical engineers. Website: altair.com.

NEW SERVICES

Gravity Software LLC, Southfield, a

cloud business management

software company, has announced its import wizard that helps Quickbooks online customers easily upgrade to Gravity software in a few hours. Website: go-gravity.com. Wilson Partners, Troy, launched its

Talem Rewards platform, an online, health, wellness and employee benefits solution for Michiganbased employers with 100 to 2,000 employees. Website: wilsonpartners.com. Deals & Details guidelines. Email cdbdepartments@crain.com. Use any Deals & Details item as a model for your release, and look for the appropriate category. Without complete information, your item will not run. Photos are welcome, but we cannot guarantee they will be used.

ADVERTISING & MARKETING

The Grosse Pointe-based

Director of Licensing / Director of Merchandising Carhartt Inc. Carhartt Inc. Carhartt has named Randy Meza as its new director of licensing. Meza, previously Carhartt’s director of marketing, will now create a strategic plan for licensing and continue to strengthen brand alignment between Carhartt and its licensing partners.

Bringing a background focused on helping companies improve the value of their products and services to his role at Patina, Mr. Bernhard will be responsible for growing the company’s presence in Metro Detroit, primarily within the automotive sector. Bernhard joins Patina with over 15 years’ experience in automotive and management consulting. Prior to joining Patina, Mr. Bernhard was Senior Director of Automotive at J.D. Power, where he was responsible for the global automotive supplier business.

Melissa Yutzey Partner

Kelley Cawthorne The leading Michigan Lobbying firm of Kelley Cawthorne announced today that Melissa Yutzey has been named a partner in the multi-client organization. Ms. Yutzey, who has been with the firm since 2005, was named one of Michigan’s top five (5) women lobbyists in surveys by both MIRS News and Inside Michigan Politics and one of the Top 10 overall in the state. “I’m proud to join the leadership team at Kelley Cawthorne and excited to help shape the firm’s strategic direction and serve our clients”.

Haven president-CEO to leave agency next month

Ralph C. Wilson Jr. Foundation

Randy Meza & Rob Morrow

Patina Solutions

Ken Rogers, executive director of Automation Alley, said last week he will retire Aug. 26 from the Troy-based technology business association. Rogers was appointed in 1999 to create and lead Automation Alley. He left his job as deputy county executive of Oakland County at the end of 2014 to run Automation Alley full time.

Wilson foundation names 3 new executives

PROFESSIONAL SERVICES

Managing Director

Longtime Automation Alley director to retire

Beth Morrison, longtime president and CEO of Pontiacbased Haven, will leave the social services agency at the end of July. Morrison, who has led Haven for 13 years, is moving to Tucson, Ariz., to serve as CEO of Our Family Services. Haven named Emily Matuszczak, senior director of programs, and Marianne Dwyer, director of business operations, as co-interim CEOs.

ADVERTISEMENT SECTION

Andrew Bernhard

PEOPLE: SPOTLIGHT

Carhartt has named Rob Morrow as its new director of merchandising operations. Morrow, previously Carhartt’s director of corporate performance, will now have oversight of the go-to-market process and lead the operations of product-led strategies.

FINANCE

FINANCE

Brendan Hanley

Sam G. Huszczo, CFA

Cambridge Consulting Group

CFA Society of Detroit

Financial Consultant

In his new role, Hanley will focus on helping individuals and small businesses accumulate and protect their wealth while minimizing tax implications through sound investment and insurance strategies. Brendan has a successful track record of providing strategic counsel to clients to help them effectively maintain and build wealth. Prior to joining Cambridge, Brendan worked at AXA Advisors as a Financial Professional. He has a Bachelor of Arts in economics from Michigan State University.

President

Sam G. Huszczo, CFA has served on the board for the past 5 years and has taken on roles as Treasurer, Programming Chair and Public Awareness Chair. During his initiatives the CFA Society of Detroit has seen increases in attendance and sponsorship. In addition, he brings over 13 years of experience in the investment management industry and is a graduate of the University of Michigan. Mr. Huszczo is voted in as the 2nd youngest president in our CFA Society of Detroit’s history, since 1948.

For more information or questions regarding advertising in this section, please call Lynn Calcaterra at (313) 446-6086 or email: lcalcaterra@crain.com

filled three newly created executive team roles by naming Amber Slichta as vice president of programs, James Boyle as vice president of programs and communications, and Maura Dewan as director of programs and strategy. Slichta had been vice president and interim president of the Health Foundation for Western & Central New York, Boyle was senior program officer for the Community Foundation of Southeast Michigan, and Dewan was

foundation coordinator at the governor’s Office of Foundation Liaison in Lansing.

Horan named Avalon CEO Bloomfield Hills-based IT company Avalon Technologies Inc. appointed former Dell executive Mark Horan as CEO. Horan spent 19 years at Dell, most recently serving as vice president and general manager of its Preferred Accounts division for commercial and public sector customers.

Nexteer tabs Quigley Nexteer Automotive Corp. has named former Visteon Corp. CFO William Quigley as senior vice president and CFO. Quigley replaces Joe Perkins, who left the Saginaw-based steering system supplier last December to become senior vice president and CFO at Sterling Heightsbased Key Safety Systems Inc.

WHIRLPOOL FROM PAGE 3

process and shorten the time it takes to brew beer. Whirlpool claims it can brew a batch of beer, which can take up to four weeks traditionally, in just seven days. Different types of yeast used to brew different varieties of beer grow and ferment best at different temperatures. The Vessi is handmade on the Whirlpool campus with a capacity to produce 2,000 units annually, Dolan said. As of last week, Whirlpool had sold 71 of the expensive Vessi units — 50 at $1,199 and 21 at $1,399. Whirlpool will sell 150 units at the $1,399 price before raising it to $1,599 and eventually retailing in traditional retail outlets at $1,899, Dolan said. A goal of raising $100,000 was set a target to validate manufacturing the product. As of June 10, Whirlpool has raised $118,359 through the Indiegogo site. Besides ponying up the cost for the Vessi, supporters can also buy a beer growler featuring a Vessi logo for $30. “I think the early indicators have surpassed our expectations,� Dolan said. Indiegogo, the San Francisco-based site, launched its Enterprise Crowdfunding service in January at the Consumer Electronics Show in Las Vegas. “The enterprise business happened organically,� said Jerry Needel, senior vice president of revenue and corporate partnerships at Indiegogo. “We had different organizations reaching out to us and, in some cases, just doing it.� General Electric Co. was the first large corporate user of the site, using it in a similar way to Whirlpool, Needel said. “GE really started all this; they ran a couple of campaigns and it started to snowball,� Needel said. “Those campaigns got a lot of attention, and other companies started to see the power of this as a product development tool.� Needel said corporate clients use

Dawn Noel Dolan: Thought crowdfunding was good way to test market for Whirlpool.

Jerry Needel: Companies save money by launching on Indiegogo.

the service to garner ideas for innovation, sponsored innovation (i.e., funding others’ innovations), and to validate a product market, like Whirlpool. “Whirlpool doesn’t need the money to bring the product to market, but they are looking for validation,� Needel said. “People vote with their dollars, and using our service takes out all the hypothetical of launching a product.� Needel said it costs one-twentieth as much to launch a product on Indiegogo than the traditional method. “Companies are now taking what traditionally was a cost in market research, etc. and turning it into sales and revenue driver,� he said. The Vessi system was developed as a result of an internal pitch competition at the company two years ago, Dolan said. Whirlpool recently created W Labs, a small division designed to bring the entrepreneurial ideas of its employees to market. “We really have a robust innovation pipeline coming, that we think could be disruptive, that isn’t typically considered in our market,� Dolan said. “This is way for us to tell our employees that their ideas can come to life right here at Whirlpool.� Besides testing the consumer waters, Whirlpool is gaining access to the early-adopter crowd in homebrewing, Dolan said, and soliciting insight from Vessi buyers. “We get to hear directly from the consumer right away, and we’re already getting ideas for future iterations of the product,� Dolan said. “We’re hearing they’d like a WiFi-connected product and other futuristic things the current product

doesn’t have.� But for others, those who use the service in a much smaller way to get products or services launched, the entrance of large corporations into the crowdfunding space is diluting its power. Kristine Sholty, social media and communications officer for Wayne State University, oversees the university’s crowdfunding platform used by student groups and affiliates to bring in donations to the school. Sholty said the university relies on gifts from passionate donors in small denominations and is worried the influx of corporations in the crowdfunding space could negatively impact the “movement.� “Crowdfunding comes down to passion, and I don’t know if that same passion exists for a large corporation,� Sholty said. “I see it as an avenue for projects that don’t have other options; I hope it remains a place for those projects and stays a little more underground instead of becoming a buzzword washed out for big companies.� Needel said Indiegogo is “an equal opportunity platform� and that its audience gets behind the projects it deems worthy, regardless of whether it’s a company or tinkerer. “The internet is smart; our audience wants to see cool, new innovations come to life,� Needel said. “They don’t care how big a company is, they just want to get early access and help shape it. We’re here to help people rally together around the projects they want to get behind.� For Whirlpool, crowdfunding allows it to operate more like a startup and experiment, Dolan said. “This is a very unique way to take a product to market for a corporation of our size and history,� Dolan said. “We’re experimenting and Indiegogo has really encouraged us to try things we’ve never done before.� Whirlpool will launch production of the Vessi system in September and after the Indiegogo supporters get delivery, it will launch a retail campaign in Grand Rapids and Denver. Dustin Walsh: (313) 446-6042 Twitter: @dustinpwalsh

Nutrition incentive program launched in Detroit expands to another seven states swelch@crain.com

A program launched seven years ago by the Fair Food Network at Detroit’s farmers markets to get SNAP beneficiaries eating healthier, while boosting local farmers, is expanding to another seven states this year. With the addition of Arizona, Arkansas, California and Colorado, which were awarded federal funding to implement the program this week, and Idaho, Iowa and Texas set to roll it out this year, the Ann Arbor-based Fair Food Network’s Double Up Food Bucks program will be operating in a total of 18 states. And the Fair Food Network is con-

sulting with organizations in Nevada and Alabama to bring the program there, while providing separate consulting support to a grocery program in Louisiana, said Communications Director Emilie Engelhard. The Double Up Food Bucks program enables participants of the Supplemental Nutrition Assistance Program (formerly food stamps) to purchase more locally grown fruits and vegetables by providing matching tokens they can use to buy additional produce. It encourages healthier eating, while also providing a boost to local farmers. Fair Food Network launched the program in 2009 at Detroit’s Eastern

Market and four other markets in

the region. Since then, the program has expanded to other farmers markets around the state and to 10 other states: Ohio, Oklahoma, New York, Oregon, Utah, New Mexico, Kansas, Missouri, Illinois and Wyoming. In 2015, low-income Michigan shoppers spent almost $2 million in combined SNAP and Double Up Food Bucks to purchase fresh, nutritious fruits and vegetables in 22 grocery stores and more than 140 direct marketing sites around the state, according to the Fair Food Network. Today, 90 percent of Michigan residents live in a county with a participating farmers market or grocery store.

Page 25

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25

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6 CRAIN’S DETROIT BUSINESS

June 13, 2016

MATCH

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DPS

FROM PAGE 3

classroom for the Arabic-speaking community. The Montessori program has already drawn enough initial interest, she said, to fill the initial three classrooms in one school building that DPS envisions. Some of that interest, she said, she has seen personally from families of children not currently enrolled in the district. The legislation still authorizes the State School Reform Office to close an underperforming charter or traditional public school after three years, as it could in past versions of the reform package. But it does not include a previously proposed Detroit Education Commission that would have set some of its grading criteria and could review the siting of new charters, in previous legislation. Rhodes, for his part, rejects the charter school advocates’ argument that open competition forces all schools to improve and that too much governance would preserve DPS’ health at the expense of a free market. The Great Lakes Education Project has argued previous versions of the legislation that placed more oversight on charters were trying to “prop up the new traditional district at the expense of parental choice.� A free market, Rhodes said, implies every customer has equal access to the market and every vendor in it has roughly the same goals. Charters choose which grade levels of students they teach, and where to locate, and educators know that high schoolers and special needs student populations require more resources than younger, general education primary school pupils. So for-profit charter schools factor that into their business decisions. “Students become generally more expensive to educate when they reach that (high school) level, and because the charters have figured that out, that changes they way they operate,� he said. “So it’s not a free market — it’s just not. We take everyone, we’re happy to take everyone, but we don’t control who we take and we have no interest in controlling who we take. The charters do control what students they take, by the kinds of schools that they open and the (grade level) slots they create.� Meriweather also saw hope in a recent teaching job fair earlier this month, she said, which drew about 400 potential applicants and 200 conditional job offers, compared with 40 or so last year. Also, she said, at least nine teachers have voiced interest in undergoing training in the Montessori method curriculum for the new program. The district has been communicating with the New York City-based American Montessori Society, which credentials Montessori educators and has two affiliated teacher education centers in Adrian and Waterford. Marcy Krever, marketing and communications director for Amer-

“People have used the term ‘culture of corruption’ in past practices, but I don’t see that. I have seen instances of corruption. And they have been loud, and they’ve been public, but they are isolated.� Judge Steven Rhodes

ican Montessori, said the organization accounts for about 1,400 member schools of the estimated 5,000 or so Montessori schools in the U.S. and elsewhere, and membership grows by about 6 percent each year. But public Montessori schools and programs have been on a growth trajectory all their own, she said. The separate National Center for Montessori in the Public Sector reports there are at least 439 public programs educating more than 112,000 children nationwide, including 11 public programs in Southeast Michigan. “It’s exciting that Montessori has been growing among public districts, because that makes Montessori available to populations that can’t afford it at private institutions, and they are often happy with the results,� Krever said. Rhodes and Meriweather said last week the public interest in DPS’ new student programs, and in a teacher job fair, might reflect a new optimism that the district is going to find its footing and stabilize after the state reforms take effect, much the way investor confidence in Detroit city finances increased within the year after it completed the bankruptcy reorganization in which he presided as a former federal bankruptcy court judge. The new funding bills will mean more than $70 million per year in state-directed operating revenue for the new Detroit school district, or more than $1,600 per pupil, by replacing a lost non-homestead property tax levy that will be used to retire legacy debt and eliminate costly current debt service on DPS’ budget. But Rhodes also noted that the city district has needs that its suburban and outstate counterparts don’t all share. “We’re all different, and equal treatment is not necessarily equitable treatment,� Rhodes said. Don Wotruba, executive director of the Michigan Association of School Boards, said a 1.2 percent decline next year is higher than the average population decline statewide, though results vary widely by district and he believes DPS administrators’ projection methods are sound. He also said Montessori and magnet school programs have already proven a competitive tool for

other school districts like Grand Rapids Public Schools. That district last year almost leveled off a population decline of 2,500 students or about 13 percent between 2010 and 2014, according to state Department of Education figures, and the Lansing Public School District has offered magnet programs, Montessori and Spanish and Chinese immersion programs for several years. “They’re out in that more competitive model of educating now, and magnet schools are becoming a key part of that,� Wotruba said. “If Detroit’s going in that direction, then they’re basically following the example of other districts who have already found some success at battling enrollment declines.� Meriweather also said the district has taken some steps to improve accountability among administrators, including new senior staff meetings where administrators review and personally sign off on expenses. Some 13 district employees were charged earlier this year in a $2.7 million corruption scheme involving former district contractor Norman Shy, and many, including Shy and former DPS assistant superintendent Carla Flowers, have already pleaded guilty and await sentencing later this year. Rhodes said last week he has referred more than one matter to the U.S. Attorney’s office for investigation since his appointment as transition manager in March, and that some federal investigations were already underway before his appointment. “So there may well be more indictments coming, but that would be part of the process of making a fresh start,� he said. But he adds that the district administrators and employees he works with are largely committed to performing their duties with integrity — corruption is the exception. “People have used the term ‘culture of corruption’ in past practices, but I don’t see that. I have seen instances of corruption,� Rhodes said. “And they have been loud, and they’ve been public, but they are isolated.� The bills headed to Snyder’s desk are expected to retire Detroit Public Schools’ accumulated operating debts and the new district startup costs, a total currently pegged around $565 million, with new longterm bonds that will roll in interest and bond costs for a total of $705 million, and be repaid by diverting an 18-mill non-homestead property tax levy from the district’s current operating revenues, likely for at least 10 years. The state will backfill the lost operating revenue for the new Detroit school district through a $72 million allocation per year through the state’s tobacco fund settlement money, supplementing its state school aid per-pupil funding each year, up to a limit of $617 million. If bond repayments continue after the backfill cap is reached, the rest of the lost revenue comes out of the state general fund. Chad Halcom: (313) 446-6796 Twitter: @ChadHalcom

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HOLTZMAN FROM PAGE 1

Holtzman, 61, is viewed as someone who has a first-rate real estate mind but also a quick temper and not much of a filter, according to discussions with former employees and real estate sources who have worked with and for him. Many also say his exacting expectations made them better and guided them toward success. A billion-dollar-plus deal with the real-estate investment trust Avalon Properties (now AvalonBay Communities Inc. after a 1998 merger with Bay Communities) was torpedoed by what has been described as a Holtzman flare-up nearly 20 years ago, according to a source familiar with the situation. Three or four years ago, Compatriot considered ousting him because of his behavior. Holtzman is seen as the grand visionary for Village Green, the seeds of which were planted in 1919 when Holtzman’s grandfather, Joseph, started one of the first licensed single-family homebuilding companies in Michigan. Over time, Jonathan Holtzman grew Village Green, founded by his father, Irwin “Toby” Holtzman, a half-century ago, into one of the nation’s largest with about 150 apartment communities and 40,000 units under ownership and management. It is the 28th-largest multifamily housing manager in the country, according to this year’s rankings from the National Multifamily Housing Council; it was 32nd-largest last year. And now he takes his money and that vision that helped make him so successful to the new City Club Apartments, which Holtzman said has 15 employees, seven of whom he brought over from Village Green, including CIO Rob Platt. “City Club Apartments will be a market disruptor, delivering unrivaled luxury apartment communities in urban, downtown markets (green, technology, customer service, amenities),” Holtzman said.

Ending the partnership Holtzman said in emailed responses to questions from Crain’s that the June 3 sale of his ownership interests in Village Green’s fee-based companies — which do not own any of the real estate that is controlled by separate corporate entities — was the result of differing visions for the partnership between him and Compatriot Capital, the real estate division of Sammons Enterprises Inc., which has $71 billion in assets. “Due to differing strategic objectives and vision, including my desire to acquire and develop in downtown Detroit, the parties mutually agreed that it would be [in the] best interest of both groups to dissolve the partnership,” he said. “They proposed buying me out of the operating companies, to which I agreed. I proposed buying them out of the real estate portfolio and development pipeline to which they agreed and the deal got done.” The real estate portfolio includes eight jointly owned apartment communities; Holtzman bought Compatriot Capital’s ownership interests

Jonathan Holtzman Title: Chairman and CEO, City Club Apartments LLC Multifamily units: Approximately 10,000 Complexes: 30 Value: $2 billion-plus Development pipeline: $500 million-plus in Detroit, Cincinnati, Chicago, Minneapolis, Pittsburgh, Louisville and Kansas City Source: Jonathan Holtzman

in five of those eight and rights to purchase Compatriot’s ownership in two of the remaining three. The five he purchased are in Detroit, Ann Arbor, Chicago, Kansas City and Louisville, and the right to buy two more in Pittsburgh. “I also purchased the entire pipeline of apartment communities that we had under development,” he said. Holtzman also sold Compatriot Capital the brand names Village Green, Village Park, Regents Park and

City Apartments.

The result? Holtzman ownership in about 10,000 apartment units in 30 apartment communities valued at over $2 billion with various partners and investors, Holtzman said, plus another $500 million in the City Club Apartments development pipeline in downtown Detroit, Ann Arbor, Cincinnati, Minneapolis, Kansas City, Louisville, Pittsburgh, Chicago and other East Coast locations. “City Club will build on the evolving platform that was created and refined with the City brand, with an eye toward taking the product to the next level with changing demographics and new attitudes of urban living,” Holtzman said. Sammons, parent company of Compatriot Capital, is a Dallas-based holding company with financial services, industrial equipment, real estate investment and infrastructure businesses in four countries. Village Green, which will keep its name, will be led by longtime president and COO Diane Batayeh, who has been with the company since the 1980s, and CIO Jason Koehn. Locally, one of the first in City Club Apartments pipeline is the Statler City Apartments project. Holtzman declined to discuss development cost, but previous city of Detroit press announcements say it’s a $35 million to $40 million development. It’s planned for Washington Boulevard and Park Avenue on the site of the former Statler Hilton Hotel at Grand Circus Park. With a planned 284 units and about 12,000 square feet of restaurant and retail space, it would be the first new ground-up apartment building construction in the central business district in recent memory. Holtzman said the project, site plan approval for which the Detroit City Council gave in March last year, is “moving full speed ahead.” “Our plan is to move as quickly as the various agencies and approval processes will allow. The plan is to begin this fall with the new name and brand,” he said. The development would be just

north of the Detroit City Apartments, which is jointly owned by Holtzman and Jim Avergis. Other downtown multifamily holdings in the Holtzman portfolio are the Elmwood Park Plaza Apartments, in which he has a co-managing membership interest along with other investors. The property is at Chene and East Larned streets. The Renaissance City Apartments at Millender Center is jointly owned by Holtzman and Greenberg, along with other limited partners. It will become a City Club branded property. The property is on Brush Street between Congress and East Larned. Greenberg, the Ottawa-based real estate investor who has come aboard as Holtzman’s development partner and co-founder and co-chairman of City Club Apartments, said he and Holtzman first crossed paths about 12 years ago. Greenberg, who spent 30 years with his family’s Minto Group of Companies, most recently as president and COO of MintoUrban Communities Inc., said his and Holtzman’s apartment developments will include “a lot of green initiatives” and cater mainly to millennials, as well as empty-nesters.

Negotiating a split Village Green employees were notified as far back as January that a deal between Compatriot Capital and Holtzman was taking shape. Last fall, Holtzman and Compatriot Capital decided it was best to sever the business relationship. Initial discussions of the split were held in late summer. Negotiations then ensued throughout the winter on a business plan and an agreement, which created the transition process, was signed in January, Holtzman said. Compatriot first took a stake in Village Green at the end of 2011 with a $15 million buyout of the interests of Chicago real estate investors Ronald Benach and Wayne Moretti, according to court documents. It’s not known exactly how much Benach and Moretti invested in the company 17 years earlier, beginning in 1994, but court filings from last year state that the men have received “throughout their years of ownership” what amounted to “a very favorable return on their investment.” The two men, currently chairman and president of Chicago-based First American Properties, respectively, owned 50 percent interest in each of five Village Green subsidiary companies, according to court documents. Holtzman sued them last year in Oakland County Circuit Court, alleging they failed to comply with contracts on multifamily projects in Royal Oak; Ann Arbor; Chicago; and St. Louis, Mo. Messages left at their Chicago office were not returned.

For generations Village Green’s beginnings date back to Holtzman’s grandfather, Joseph, a Russian immigrant who moved from St. Louis to Detroit in 1914 for a job on a Ford Motor Co. assembly line earning $5 per day. In 1934, he partnered with Nathan Silverman, his brother-in-law, and built working-class Detroit homes as

Holtzman & Silverman, branching out into the suburbs after World War II. Village Green apartment developments started in 1966 under Toby Holtzman. The next generation of the families, Toby Holtzman and Gilbert Silverman, continued in the business together and Jonathan and Gilbert “Buzz” Silverman continued the company largely as it was until 1993. That year, Buzz Silverman branched off to create Silverman Cos., selling its home-building business to national home builder Toll Bros. Inc. in 1999. In 2005, Crain’s included the Holtzman-Silverman breakup in its 20 top feuds in Detroit area business. A message left at Silverman’s Birmingham office was not returned last week.

Strong personality Holtzman is seen widely as a demanding executive with a management and negotiation style that doesn’t ring well with everybody. Sources call him demanding; some say he can be insulting and prone to verbal outbursts. Holtzman says it’s all about making his companies the best. “I am passionate about what we do for our residents, our employees, our communities and our investors.” “I don’t see my style as any different than any other leaders that expect the highest level of excellence from those around them.” One former prominent employee described his more than 10 years working under Holtzman as tough but formative. “Jonathan was an incredibly

challenging and difficult boss to work for, and at the same time, incredibly bright and pushed me to the point that I know he helped me become the business owner that I am today,” said Tim Smith, president and CEO of Detroit-based Skidmore Studio LLC, who was senior vice president of advertising and communications for Village Green from 1988 to 2000. Kevin Dillon, managing director of the multifamily investment sales division of the Southfield office of Philadelphia-based Berkadia, called Holtzman a “strong personality with a strong vision.” It’s that vision that makes the Village Green acquisition a good move for Compatriot, he said. “Village Green was a strong value. Jonathan was a visionary with his downtown redevelopments and suburban properties.” Richard Hosey, a former senior vice president for Bank of America NA who now owns Detroit-based Hosey Development LLC and is a member of the Detroit Historic Commission board, has worked with Holtzman on the Statler City Apartments project. “Developers tend to have somewhat aggressive personalities,” he said. “You have to look at a piece of land or an empty building and decide, to some degree, that the rest of the world is wrong and that you can do it. “His personality does not stand out to me as being outside the norm. I expect him to be aggressive.” Kirk Pinho: (313) 446-0412 Twitter: @kirkpinhoCDB

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CALENDAR TUESDAY JUNE 14

Intellectual Property Law for the Growing Business. 8:30-10:00 a.m.

Automation Alley. Partner company Brooks Kushman PC will offer an overview of common intellectual property legal issues for growing businesses; how to overcome common obstacles and strategies to maximize protection; and guidance on trademarks, patents and licensing agreements. Automation Alley, Troy. $20 members; $40 nonmembers. Contact: Lori Podsiadlik, phone: (248) 457-3212; email: podsiadlikl@ automationalley.com.

WEDNESDAY JUNE 15

MiQuest CEO Growth Symposium. 8 a.m.-1:30 p.m. Small Business Association of Michigan. The symposium, for leaders of growthstage businesses, will include a number of sessions designed for maximum connection and action for attendees. Ann Arbor Marriott, Ypsilanti. $200. Website: sbam.org. Local Breakthrough Summit. 8 a.m.-1

p.m. YP. Help for local business owners as they try to break through with innovation, technology and expertise in digital marketing. Speakers along with YP partners Google, Yahoo, Bing and Verve will present the latest insights around mobile, display, social and search to power a business. Garden Theater, Detroit. Free. Phone: (314) 300-

GOLF FROM PAGE 1

7303; email: dw8988@yp.com.

THURSDAY JUNE 16

2016 Investment Breakfast. 7-9:30

a.m. Southwest Detroit Business Association. The breakfast attracts more than 300 leaders representing Detroit-area businesses and corporations, foundations, government entities and residents from Southwest Detroit and Southeast Michigan. Sound Board, MotorCity Casino Hotel, Detroit. $80; $650 table of 10. Website: mhcc.org/events.

FRIDAY JUNE 17

The Impact of Mission, Vision, Core Values. 7:30-9 a.m. The Business Round Table. Speaker Roger Norberg, chairman of the C12 Group,

will be the speaker. Birmingham Country Club, Birmingham. $35 prepaid; $40 at the door. Contact: Christa Moxon, phone: (269) 685-7829; email: christa.moxon@ thebusinessrt.org.

Calendar guidelines. Visit crainsdetroit.com and click “Events” near the top of the home page. Then, click “Submit Your Events” from the drop-down menu that will appear. Fill out the submission form, then click “Submit event” at the bottom of the page. More Calendar items can be found at crainsdetroit.com/events.

alleviate issues with too-steep bunkers and add up to 6 acres of landing space on fairways, Hildebrand said. The club’s 500-plus stock-owning members were informed of the restoration plan in the spring, and a series of informational meetings have been held by Oakland Hills’ management to spell out details of the proposed project. They will vote beginning June 20, and if a simple majority OK the project by a July 8 deadline, the course will be shuttered from March 2018 through May 2019. The project would be financed through an increase in member dues over time rather than in an upfront lump sum. It costs $72,000 to join the private club, which does not disclose its finances or annual dues information. Oakland Hills in 2014 retained noted architects Hanse Golf Course Design from suburban Philadelphia to survey the South Course — golf icon Ben Hogan famously termed it “The Monster” after winning the 1951 U.S. Open there — to determine what should be done with it after nearly a century. Hanse was chosen over three other course designers, including Rees Jones. The club’s management is seeking to ensure the South Course is playable by members while also maintaining its status as one of the tougher sites for major tournaments. “What we think we can achieve is both a course that can host future championships, but also be more

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“What we think we can achieve is both a course that can host future championships, but also be more enjoyable for our members day in and day out, because they’re the ones that pay the bills and they’re the ones that play it.” Tim Hildebrand, Oakland Hills Country Club president

enjoyable for our members day in and day out, because they’re the ones that pay the bills and they’re the ones that play it,” Hildebrand said. “You’re always looking at the balance between championship golf and member playability. You don’t have to compromise either one.” Oakland Hills has hosted six U.S. Opens (the second most in the tournament’s history, which dates to 1895), and last October the club informed the Far Hills, N.J.-based United States Golf Association, the Open’s organizer and the governing body of U.S. golf and golf clubs, that OHCC is again formally interested in hosting a U.S. Open. Hildebrand, who is managing director of Crain Custom Content for Crain’s Detroit Business corporate parent Crain Communications Inc., is adamant that the restoration project is unrelated to the desire to host another U.S. Open. Some members have expressed worry the project was fueled by a desire to host more tournaments. “We are not doing this plan to pursue another major championship. We are doing this plan first and foremost for the members,” he said. He also said the USGA has never commented on the South Course’s condition or difficulty. Oakland Hills is hosting the USGA-run U.S. Amateur in August, and USGA officials toured the South Course earlier this year. “They have never communicated to us that we would have to do anything to our golf course,” Hildebrand said. There is no timetable for when the USGA will award the next round of U.S. Opens. Last summer, it awarded Opens for 2022-24. A message was left for USGA management. Oakland Hills is trying to gauge its chances at another U.S. Open so it can plan its long-term business strategy. “What we’re trying to figure out sooner rather than later is where we are as it stands to future U.S. Opens so we can figure out where to go moving forward,” Hildebrand said. Oakland Hills long has had a reputation as an elite club with a deep history of hosting major tourna-

ments, and club management said the strategy is to continue seeking out USGA and PGA Tour events to burnish that reputation. It also has hosted three PGA Championships, the 1929 U.S. Women’s Amateur, the 1981 and 1991 U.S. Senior Opens, and the 2004 Ryder Cup matches. “Oakland Hills has tremendous history, hosting numerous championships and operating at an incredibly high standard over the last 100 years — this is what has established our brand,” Hildebrand said. While Oakland Hills expects the U.S. Amateur to lose money, the major tournaments such as the U.S. Open and PGA Championship are money-makers — although they’re not as lucrative as they used to be. “The financial upside of these things isn’t what it was 20, 30 years ago. We do it more because it’s our place in golf history, and a big part of it is giving back to the game of golf. This is (OHCC members’) way of giving back to the game. It’s a big commitment and sacrifice by the members, but the members are committed to doing that.” While the South Course is closed for restoration, members will be able to play the Ross-designed North Course, which opened in 1924 and underwent a nearly $2 million upgrade in 2013. Additionally, Oakland Hills has worked out reciprocity deals with nearby clubs for members to use, Hildebrand said. The South Course project will be Oakland Hills’ largest project since the original clubhouse, built in 1921-22 by local architect C. Howard Crane, underwent a $16.2 million renovation in 1999-2000. Michigan golf industry observers are keen to see what unfolds with OHCC’s South Course project. “It’s a positive thing. When Rees came in and made the changes, he made it very difficult. He did it for tour pros. They’re not playing these courses every day,” said Kevin Frisch, CEO of Gaylord-based Fusion Media Strategies, a golf and travel marketing firm. “It makes the game very difficult and not fun to play.” Frisch, who has played Oakland Hills a few times since the 2006-07 changes, thinks the project could inspire other courses to do the same. A trend beginning in the 1970s was to make golf course more difficult, especially those that host major tournaments. “Hopefully, the industry will look at Oakland Hills, and other golf courses interested in improving member playability will follow their lead,” he said. Oakland Hills traces its origins to October 1916, when it was founded by Norval Hawkins, the first Ford Motor Co. general sales manager, and Joseph Mack, a printer for automotive industry sales materials. There were 140 charter memberships at a cost of $250 apiece, according to the club’s official history. The first club pro was Walter Hagen, one of the most instrumental figures in the development of modern golf and whose 11 major championships are third-most in golf history. Bill Shea: (313) 446-1626 Twitter: @Bill_Shea19

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DRUGS FROM PAGE 3

biotech and personalized medicine drugs, Pawlicki said. “We have really seen significant increases the past few years. Last year was just intensified and much larger than in the past,” Pawlicki said. Last year, Beaumont spent about $250 million for pharmaceuticals, but this year costs are projected to rise above $270 million, an 8 percent increase, she said. “The majority of the price increases are for existing drugs, but we also are paying higher prices than usual for newer biotech drugs that are coming into the market,” she said. “We have approved 13 new biotech drugs, and we estimate spending about $14.3 million. This is to treat 476 patients, usually in an infusion center, for a chronic disease or oncology.” Executives at St. John Providence Health System and St. Joseph Mercy Health System in Ann Arbor also confirm high drug prices are becoming a problem. St. John’s average pharmacy prices are up 13 percent this year, and St. Joe’s projects more than a 10 percent increase, up from 5 to 7 percent in recent years, executives said. Generics made only by a single source, such as Daraprim, are increasing in price without warning due to lack of competition, said Chris Cook, St. Joseph Mercy’s regional director of pharmacy. “Specialty medications for complex disease states such as HIV or cancer are high-technological products and very expensive,” said Cook, adding that oncology medications are “not only expensive but the utilization is rising as we get better at detecting and treating more cancers.” Experts project that by 2020, specialty drugs will make up 50

percent of all medication costs nationally, including hospital, retail and clinics, rising from $98 billion spent in 2016 to $212 billion in 2020. Last year, the Food and Drug Administration approved 45 novel medicines for marketing. Biologics accounted for 12 of the 2015 approvals versus 10 during 2014. More than half were drugs to treat cancer (33 percent), cardiovascular disease (17 percent) and infections (8 percent). In May, Pfizer agreed to acquire Anacor Pharmaceuticals for $5.2 billion to gain control over its eczema treatment, Crisaborole, which has projected annual sales of $2 billion. But U.S. regulators recently nixed the merger of Pfizer and Allergan. Other recent targeted transactions include Bristol-Myers Squibb’s acquisition of Padlock Therapeutics, which could expand its presence in the treatment of rheumatoid arthritis, and Eli Lilly’s acquisition of Glycostasis Inc., which is seeking to develop a form of insulin that self-releases when a diabetic patient’s blood sugar level is too high. In addition, Merck bought IOmet earlier this year, adding new immune-oncology technology to its portfolio.

Will the high prices continue? Kirby said he believes some drug companies will be hard-pressed to justify or demonstrate additional value that higher prices might warrant because the drugs have been on the market for some time. “They claim the drug is so significantly undervalued they had to jack up the price a multiple of times,” Kirby said. Because of the increased scrutiny from Congress and the media, Kirby doubts that drug companies will be able to continue to increase prices. Several national organizations,

INDEX TO COMPANIES

These companies have significant mention in this week’s Crain’s Detroit Business: Acheson Industries ............................................11

IAC Group ........................................................... ..8

American Society of Employers ......................21

IDC Industries ...................................................20

AutoLiv ............................................................... ..8

Inn on Water Street ...........................................12

Beaumont Health ............................................. ..3

Inteva Products ................................................ ..8

Bedrock Detroit ................................................29

JB Realty ............................................................ ..9

Blue Water Area Conv. & Visitors Bureau ......12

Kelly Services .................................................... ..8

Blue Water Winery and Vineyards ..................14

Kramer Realty ................................................... ..9

City Bird + Nest ................................................. ..4

Meritime Construction .....................................16

City Club Apartments ....................................... ..1

Michigan Association of School Boards .......26

CityFlats ........................................................... ..10

Molly Maid ..........................................................19

Consumers Energy ........................................... ..9

MPG Inc. ............................................................. ..8

Cooper-Standard Automotive ....................... ..8

NSF International ............................................. ..8

Cyberoptix ......................................................... ..4

Oakland Hills Country Club .............................. ..1

Detroit Labs LLC ...............................................20

Perrigo ................................................................ ..8

Detroit Public Schools ..................................... ..3

St. Clair County Community College ...............11

Domino’s Pizza .................................................. ..8

St. Clair Co. Econ. Development Alliance ...... ..9

DoubleTree by Hilton Port Huron ................... ..9

St. Clair Inn ...................................................10, 15

Dow Chemical ................................................... ..8

St. Joseph Mercy Health System .................. .29

Fair Food Network ............................................25

ThumbCoast Brewing .......................................14

Faurecia North America .................................. ..8

TI Automotive ................................................... ..8

FCA US LLC ........................................................ ..8

Travel Michigan ............................................12, 14

Federal-Mogul ................................................... ..8

Village Green Cos. .............................................. ..1

Ford Motor ......................................................... ..8

Vision Information Technologies ................... ..8

Grand Valley State University ..........................18

War Water Brewery ...........................................14

Green Barn Brewery ..........................................14

Wayne State University ...................................25

Hamilton Anderson Associates .....................29

Well Done Goods .............................................. ..4

Harsens Island Brewery ....................................14

Whirlpool ........................................................... ..3

such as the Campaign for Sustainable Rx Pricing, The American Society of Health System Pharmacists and the American Association of Retired Persons, have mounted strong cam-

paigns against high drug prices. “I am critical of how and what is going on in the pharmaceutical industry,” Pawlicki said. “There are a number of examples where manufacturers have increased costs without demonstrating any sudden change in the value of drugs.” But Kirby added that some newer specialty drugs for oncology and hepatitis are being priced significantly higher than their predecessors. “If a drug has been around for 20 years, it shouldn’t be priced 500 percent more today,” Pawlicki said. “There are some drugs that benefit patients immensely. They reduce hospital length of stay and improve conditions.” For example, the Hepatitis C specialty medicine, which can cost up to $100,000 a year to treat patients, has proven value, Pawlicki said. “These drugs (Sovaldi, Olysio or Harvoni) cure and can save money over time as patients don’t have to be chronically treated for two years,” she said. Pawlicki said drug prices appear to have stabilized the past few months but haven’t dropped. “Valeant held back some further price increases and promises some retooling, but I haven’t seen anything yet,” she said. Meanwhile, executives at Beaumont, St. Joseph Mercy and St. John have taken steps to more effectively manage costs and supplies. “It’s challenging and costly both for health care organizations and the patients and families who need the medications,” Pawlicki said. Hospital systems and medical staffs are coaching doctors and patients about best use of pharmaceuticals and when to use generics or other alternative therapies.

“We are looking heavily at clinical evidence to make sure we are utilizing appropriate clinical medicine and keeping doctors abreast of pricing,” Pawlicki said. “We are working alternatives and looking at our formularies, leveraging supply contracts, using different-size vials, a whole host of things to reduce expenses.” Cook said because St. Joseph Mercy is part of Novi-based Trinity Health, bulk purchasing helps minimize costs compared with smaller hospitals or health organizations. Trinity operates 90 hospitals nationally, including 11 in Michigan. “We created a task force to identify the most cost-effective drugs, utilization strategies and dispensing practices across our five-hospital system,” said Cook, noting the effort will save several hundred thousand dollars. “We continuously look for drug alternatives and advanced utilization strategies to maintain cost effectiveness without sacrificing quality and safety,” Cook said. Pawlicki said hospitals are capped at how much they can charge payers like Medicare and Medicaid for higher drug costs. In outpatient settings, however, patients absorb the higher costs, she said. “If treatment is at an infusion center or self administered at home, the reimbursement is a little different,” she said. “Reimbursement may or may not cover the costs. If a patient obtains meds through outpatient pharmacy, the patient pays out of pocket” for the price increase. But Pawlicki said Beaumont — like most other hospitals — have special programs to help lower income patients pay for higher-priced drugs. Last year, Beaumont helped 206 patients get access to free or drug company rebates that were worth about $2.4 million, she said. Jay Greene: (313) 446-0325 Twitter: @jaybgreene

Bedrock, Hamilton Anderson win grand prize for Brush Park design By Marti Benedetti mbenedetti@crain.com

Two Detroit-based companies,

Bedrock Detroit and Hamilton Anderson Associates, last week were named winners of the 24th Annual Congress for New Urbanism’s grand prize for the

design of their Brush Park project. The honor was awarded Thursday at the CNU conference in Detroit, which was to run through Saturday. The $70 million Brush Park Development Partners revitalization project took the prize based on how its plan preserves existing historic houses while filling in with new housing that will be appropriate to the neighborhood’s size and scale. “With our particular team, everyone involved was passionate in rebuilding a neighborhood and not proposing a development,” said Amy Chesterton, director of planning for Hamilton Anderson, master planners for the project. Bedrock

is the project developer. Other partners in the development are Marvin Beatty, chief community officer for Greektown Casino-Hotel in Detroit and an investor in the planned $160 million redevelopment of the former Michigan State Fairgrounds site; Sam Thomas, president of Benton Harbor-based Star Development Co.; Darrell Burks, former senior partner of PricewaterhouseCoopers LLP and a member of the Detroit Financial Review Commission; former Detroit mayoral candidate Freman Hendrix, president and CEO of Detroit-based Advanced Security & Investigative Solutions; and Pamela Rodgers, owner and president of Rodgers Chevrolet.

Other architectural firms working on the project include Grosse Pointe Park-based Christian Hurttienne Architects, Los Angeles-based Lorcan O’Herlihy Architects, Boston-based Merge Architects and Chicago-based Studio Dwell.

www.crainsdetroit.com Editor-in-Chief Keith E. Crain Group Publisher Mary Kramer, (313) 446-0399 or mkramer@crain.com Editor Jennette Smith, (313) 446-1622 or jhsmith@crain.com Director, Digital Strategy, Audience Development Nancy Hanus, (313) 446-1621 or nhanus@crain.com Managing Editor Michael Lee, (313) 446-1630 or malee@crain.com Managing Editor/Custom and Special Projects Daniel Duggan, (313) 446-0414 or dduggan@crain.com Assistant Managing Editor Kristin Bull, (313) 446-1608 or kbull@crain.com News Editor Beth Reeber Valone, (313) 446-5875 or bvalone@crain.com Senior Editor Gary Piatek, (313) 446-0357 or gpiatek@crain.com Research and Data Editor Sonya Hill, (313) 446-0402 or shill@crain.com Newsroom (313) 446-0329, FAX (313) 446-1687, TIP LINE (313) 446-6766

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30

WEEK

C R A I N ’ S D E T R O I T B U S I N E S S // J U N E 1 3 , 2 0 1 6

ON THE WEB JUNE 4-10

SSG partners Detroit Digits with national firm 3.95 percent

R

ochester Hills-based Strategic Services Group has joined Indianapolis-based United Benefit Advisors, a national employee benefits advisory group, to take advantage of additional services to serve its local customers, SSG officials said. The partnership arrangement, which is not a sale or acquisition, gives Strategic Services Group access to many UBA programs and services. UBA has nine other partner companies in Michigan, including Comprehensive Benefits in Southfield and BenePro in Royal Oak.

COMPANY NEWS n Demolition is scheduled to begin within the next month on the Henry Ford Macomb Hospital campus in Warren to make way for a $30 million retail development anchored by a Meijer store. The 225,000-square-foot development at East 10 Mile and Schoenherr roads is expected to generate about 160 construction jobs and 100 full-time equivalent jobs. n StockX, one of Dan Gilbert’s portfolio companies, announced it has formed a strategic partnership with Detroit-based Marshall Mathers, better known as rapper Eminem. Mathers and his partner, Paul Rosenberg, will invest in the online auction platform, whose focus is the resale market for high-end collectible sneakers, and Mathers will make shoes from his personal collection available. n Troy-based Cambridge Consulting Group is moving its corporate headquarters to Royal Oak to accommodate planned growth. The insurance and financial services company is taking about 20,000 square feet in the Howard & Howard Building at 400 W. Fourth St., with occupancy expected in August. n Auburn Hills-based Faurecia North America is hiring and laying off workers almost simultaneously in recent months, as its seating business continues to expand but a separate automotive interiors business struggles with falling production orders. Faurecia, a subsidiary of French auto supplier giant Faurecia Group, recently finished hiring 90 new employees in an $8 million Sterling Heights plant upgrade, but it is letting go of 105 mostly production employees at a separate Faurecia Interior Systems plant in Sterling Heights effective July 1, and another 130 interiors employees in Fraser starting July 1, according to notices filed with the state. n The Jenoptik Group, a German-based technology company that specializes in metrology and laser machines for the auto industry, is investing about $15 million and adding jobs at its Rochester Hills location. Ground

The tuition increase for undergraduate students in the 2016-17 academic year passed by trustees at Oakland University. The increase for graduate students will be 3.93 percent.

21 million

The number of fully and semiautonomous vehicles to be sold globally by 2035, according to a forecast from Southfield-based IHS Automotive, reported by Automotive News, a sibling publication of Crain’s Detroit Business.

$14.4 million

The expected investment by Laird PLC, a London-based supplier of wireless and antenna components, to move its engineering, research and design center from Holly to a building in Grand Blanc. Expected to open in 2017, the project will create at least 20 new jobs, the company said.

was broken May 31 on the planned 16-acre technology campus, adjacent to the building Jenoptik rents at 1505 W. Hamlin Road. n Southfield-based seating and electronics supplier Lear Corp. is planning to build a new headquarters for its Asia-Pacific operations in the Yangpu District of Shanghai, China. The new complex will be built near Lear’s current headquarters, also in the Yangpu District, the company said, with completion slated between late 2018 and early 2019. The cost was not disclosed. n Karma Automotive LLC, formerly Fisker Automotive Inc., will establish an engineering and sales office in Troy. The investment is expected to total $3.6 million and create up to 150 new jobs, the Michigan Economic Development Corp. said. n Detroit-based DTE Energy Co.

plans to shut down eight more coal-fired units at three power plants in Michigan within the next seven years. The units to be retired between 2020 and 2023 are at the River Rouge facility, the St. Clair facility in St. Clair County’s East China Township and the Trenton facility, the utility said. n Nearly half of the $5.4 million in grants made by the Detroit-based Children’s Hospital of Michigan Foundation for fiscal 2016 are supporting pediatric health care research, the foundation said. Of the grants, $2.37 million went to 23 pediatric researchers from the Wayne State University School of Medicine, University Pediatrics and DMC Children’s Hospital of Michigan. n KLA Laboratories Inc., a Dearborn-based IT firm, was to hold a ribbon-cutting ceremony and celebrate the grand opening of its first west-region headquarters

RUMBLINGS

on Friday in Las Vegas.

n Wayne State University said it would collaborate with Southfield-based Automotive Industry Action Group to develop degree and certificate programs in the field of automotive supply chain. n Detroit-based Strategic Staffing Solutions plans to continue sponsoring the city police department's unit of horses, AP reported. The company made a $300,000, three-year commitment through the Detroit Public Safety Foundation. OTHER NEWS

n The state House approved two bills that would update Michigan’s horse racing law, including how money from wagers is distributed between the state’s two remaining tracks, Hazel Park Raceway and Northville Downs. The bills would create a site-specific formula to distribute revenue from wagers placed on simulcast races at Hazel Park, which hosts thoroughbred races, and Northville Downs, which holds standardbred harness races. That formula would replace the common purse that shares revenue with the tracks and their respective horsemen’s groups, with 65 percent going to standardbreds and the rest to thoroughbreds. n Wayne County Community College District announced it will

build a two-story, 80,000-squarefoot health and wellness center affixed to the downtown Detroit campus to provide training for students pursuing careers in related fields, and a $15 million horticulture center at its Taylor campus. n The Wayne County Medical Examiner’s Office has earned national accreditation for the first time in 40 years. The National

Association of Medical Examiners

awarded the accreditation after an inspection and evaluation of its practices, processes and resources. n After Will Power raced to an IndyCar victory, Bud Denker, chairman of the Detroit Belle Isle Grand Prix, announced the event will return next year on June 2-4, AP reported. n The state said the city of Inkster’s finances have improved and it is being released from the terms of an agreement that allowed it to avoid a Michigan-appointed emergency manager, AP reported. n Detroit Mayor Mike Duggan announced that he will not fill Deputy Mayor Ike McKinnon’s position when McKinnon retires at the end of the month. In Duggan’s absence, Police Chief James Craig will act as mayor.

OBITUARIES

n Al Ackerman, a former sportscaster at WDIV-Channel 4 and WXYZ-Channel 7 during a 25-year career in Detroit who coined the rallying cry “Bless You Boys” for the Detroit Tigers leading up to the team’s 1984 World Series victory, died June 6. He was 90.

M

Gordie Howe’s business genius was at his side

r. Hockey had plenty of help, during and after his hockey career, from Mrs. Hockey. Mr. Hockey, of course, was iconic Detroit Red Wings superstar Gordie Howe, who died Friday at age 88. And Mrs. Hockey was his wife of 56 years, Colleen Howe, who died at age 76 in 2009. She was his late-career agent, and his business manager for decades, running their enterprises and Gordie Howe: Held a successful charitable business brand. ventures as Rochester Hills-based Power Play International Inc. Together, they crafted what became the successful Gordie Howe brand. They trademarked “Mr. Hockey” and “Gordie Howe” in August 1993 with the U.S. Patent and Trademark Office, and “Mr. and Mrs. Hockey” followed in 2005. Apart from appearances, autographs and some endorsement work, Howe was relatively low-key in his post-playing business career. A fierce beast and elegant scoring machine on the ice for decades, he was said to be modest and deeply polite away from it. After his playing career, Howe had his hand (often directed by Colleen) in a number of endeavors, such as being a sports adviser for Canada’s now-defunct Eaton’s department store chain, doing promotion work for a Detroit car company, having a financial interest in a ranch, co-owning a string of hockey schools, and selling insurance at one time, according to a profile of him in Canada’s Globe & Mail newspaper. For fans and philanthropy, Howe put his signature on untold pieces of merchandise, apparel, and trading cards over the decades, and such things command a premium online. The priciest Gordie Howe item on eBay on Friday afternoon was what a seller described as a rare misprinted Topps hockey trading card from 1970-71, which was listed for sale at $19,006.51.

Mobility center targets possible funding sources Developers of the American Center for Mobility in Ypsilanti

Township say they plan to target federal transportation, energy and commerce departments for $60 million in funding to help build out the planned test facility for connected and automated vehicles. In addition, they plan to seek $17 million in state funding this summer from the Michigan Strategic Fund, a division of the Michigan

Economic Development Corp., said John Maddox, the center’s CEO, at the Detroit Regional Chamber’s recent Mackinac Policy Conference. Total state funding for the estimated $80 million project will total close to $20 million. The MEDC already has awarded $3 million to cover startup costs, including for a related entity, Willow Run Arsenal of Democracy Landholdings LLP, to purchase the

335-acre site and lease it back to the American Center for Mobility. The site is owned by the RACER Trust, which was created during then-General Motors Corp.’s 2009 bankruptcy proceedings to handle environmental cleanup of GM’s closed plants. Federal transportation dollars are a likely choice, along with the energy and commerce departments, Maddox said. Connected and driverless cars have potential to reduce the amount of energy spent on transportation or, conversely, to increase it, so the energy department “has a very strong policy desire to help ... understand what that impact may be,” Maddox said, adding that commerce administrators could be interested in the economic development implications these vehicles bring. “There’s not likely one federal agency that would fund all of that,” he said. “It’s hard to ask the federal government for money. Bottom line is, it takes a legislative and/or an executive branch decision.” Maddox said he and other Michigan mobility advocates are in frequent communication with the state’s congressional delegation.

Ciura named among nation’s top women in retail A local retail and marketing consultant has been honored as one of the top women in retail nationally. Cindy Ciura, principal of Bloomfield Hills-based commercial real estate and retail consulting firm CC Consulting LLC, was one of 26 honorees as Real Estate Forum’s Top Women in Retail this year. Ciura started CC Consulting in 2005 after working as vice president of marketing and retail for the Detroit Economic Growth Corp. in 2004-05, vice president of corporate marketing for Livonia-based Schostak Bros. & Co. from 1998 to 2004, and corporate marketing director for Southfield-based The Forbes Co. from 1991 to 1997, according to her LinkedIn profile. She counts Oakland County, the city of Royal Oak, Detroit-based Olympia Development of Michigan and Troy-based Emagine Entertainment Inc. among her

clients, according to a news release. She was presented her award in Las Vegas last month.

TO THE RECIPIENTS NAMED CRAIN’S MOST INFLUENTIAL WOMEN OF 2016!

This year’s 100 award recipients join these esteemed past Most Influential Women Honorees in exemplifying proven corporate success and civic achievements*. Barbara Allushuski

Michelle Crumm

Joy Greenway

Elizabeth Lowery

Karla Scherer

Trudy Archer

Linda Cummins

Cindy Grines

Maud Lyon

Kari Schlactenhaufen

Lizabeth Ardisana

Julia Darlow

Beverly Hall Burns

Rebecca Maccardini

Lorraine Schultz

Anne Asenio

Vernice Davis Anthony

Elizabeth Hardy

Sharon Madison Polk

Martha Seger

Donna Bacon

Dottie Deremo

Carmen Harlan

Barbara Mahone

JoAnne Shaw

Nancy Bacon

Alicia Diaz

Kim Harris Jones

Joan Mahoney

LaVonne Sheffield

Linda Bade

Andrea Dickson

Susan Harvey

Robyn Marcotte

Lou Anna Simon

Penelope Bailer

Deborah Dingell

Joyce Hayes-Giles

Florine Mark

Susan Skerker

Brenda Ball

Geralda Dodd

Karen Healy

Vickie Markavitch

Rebecca Smith

Leslie Banas

Jacqueline Dout

Susan Hendrix

Bella Marshall

Janet Sparks

Kathleen Barclay

Gail Duncan

Rita Hillman

Linda Marshall

Shirley Stancato

Terry Barclay

C. Beth DunCombe

Deborah Hitch Hopkins

Patricia Maryland

Denise Starr

Vicki Barnett

Melissa Dunham Cragg

Pearl Holforty

Kathleen McCarroll

Anne Stevens

Gladys Barsamian

Peggy Dzierzawski

Kathleen Holycross

Nina McClelland

Linda Taggart

Sarah Bates

Susan Edwards

Michelle Horowitz

LeAnne McCorry

Teri Takai

Lillian Bauder

Sue Ellen Eisenberg

Carole Hutton

Colleen McDonald

Susan Beale

Irma Elder

Denise Ilitch

Shiela McKinnon

Christine Beatty

Lynne Ellyn

Marian Ilitch

Elaine McMahon

Kate Beebe

Beverly Erickson

Jill Jablonski Miller

Terry Merritt

Kay Benesh

Haifa Fakhouri

Heidi Jacobus

Patricia Mooradian

Lucy Benham

Amy Farmer

Mildred Jeffrey

Joan Moore

Nancy Berg

Maureen Fay

Kathryn Jehle

Sue Mosey

Stephanie Bergeron

Ann Federici

Eleanor Josaitis

Shirley Moulton

Pamela Berklich

J. Kay Felt

Marilyn Katz-Pek

Carmen Munoz

Maxine Berman

Julie Fershtman

Pauline Kelly

Leslie Murphy

Jan Bertsch

Marianne Fey

Maureen Kempston Darkes

Mariam Noland

Linda Blair

Lisa Fildes

Debbie Kenyon

Janet Ofodile

Penny Blumenstein

Andrea Fischer Newman

Mary Kline-Cueter

Judy O'Neill

Barbara Boyden Labadie

Jodee Fishman-Raines

Phyllis Knight

Kathleen Oswald

Mary Jo Braun

Luana Floccuzio

Susan Kornfield

Cynthia Pasky

Beth Brockmann

Linda Forte

Susan Lackey

Judith Pelham

Marcie Brogan

Karen Francis

Jill Lajdziak

E. Jill Pollock

Shari Burgess

Blance Fraser

Nicole Lamb-Hale

Waltraud Prechter

Connie Calloway

Maureen Gallagher

Eileen Lappin Weiser

Glenda Price

Carol Walters

Sharon Cannarsa

Julie Galliker

Carol Larson

Nanci Rands

Billie Wanink

Beth Chappell

Barbara Gattorn

Brenda Lawrence

Deborah Ravetta

Jane Warner

Seema Chaturvedi

Zelda Geyer-Silvia

Maria Leonhauser

Anne Regling

Linda Watters

Doretha Christoph

Grace Gilchrist

Maureen Lesourd

Terry Ann Reiley

Marilyn Wheaton

Denise Christy

Nancy Gioia

Mara Letica Saad

Martha Richardson

Tommi White

Susan Cischke

Louise Goeser

Til Levesque

Catherine Roberts

Marina Whitman

Noreen Clark

Marcia Goffney

Denise Lewis

Ruth Roby Glancy

Cynthia Wilbanks

Rhonda Cohen

Lorraine Golden

Kathleen Lewis

Pamela Rodgers

Marilyn Wilbarger

Mary Sue Coleman

Edie Goldenberg

Kathleen Ligocki

Barbara Rom

Geneva Williams

Anne Cooke

Deborah Gordon

Karen Livingston-Wilson

Mary Roth

Karen Wiltsie

Christine Cortez

Carol Goss

Frederica Lombard

Barb Samardzich

Toni Wisne

Brenita Crawford

Verna Green

Judy Love

Lynne Schaefer

Mary Zuckerman

Margaret Talburtt Iris Taylor Margaret Taylor Smith Linda Thomas Brooks Maria Thompson Gail Torreano Jeanne Towar Diana Tremblay Darlene Trudell Susan Unger Lorna Utley Jan Valentic Amanda Van Dusen Deborah VandenBroek Edie Waddell Deborah Wahl Meyer Norma Wallis

*this list includes Crain’s Most Influential Women honorees from 1997, 2002 & 2007.

To learn more about this year’s Honorees and register for the awards ceremony on June 21 at Suburban Collection Showplace in Novi, visit www.crainsdetroit.com/events or call 313-446-0300.

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