Crain's Detroit Business, Sept. 17, 2018 issue by Crain's Detroit Business

Card move helps Lafayette feed corporate hunger Page 6

LCA one of world’s busiest arenas in 1st year Page 3

SEPTEMBER 17 - 23, 2018 | crainsdetroit.com

REAL ESTATE

DETROIT HOMECOMING

Crowne Plaza pulls plans for second hotel tower By Chad Livengood clivengood@crain.com

cap has nearly doubled since its low in 2012, thanks to record sales in 2015 and 2016. But despite improved business operations and a strong automotive sector, the question looms: Are Michiganders better off now than before the economic collapse a decade ago? The answer largely depends on your socioeconomic standing in the state.

After striking out twice at Detroit City Council, the owners of the Crowne Plaza in downtown Detroit are pulling the plug on a new 500-room 28-story hotel tower connected to Cobo Center — for now — and considering new hotel investments in Houston and San Diego instead. Operadora de Servicio Para Hoteles de Lujo, a Mexican and European investor group that bought the former Need Hotel Pontchar- to know train out of bank-  $164 million, ruptcy in 2013, 500-room hotel has decided to project has been stop pursuing the twice rejected by project after coun- City Council cil members sug-  Hotel's gested the compa- ownership group ny should sign a to shift new neutrality agree- investment to ment for a labor Houston, San union to represent Diego hotel workers. The investor  Council group’s board met members wanted Thursday and de- hotel owners to cided to shift its sign neutrality new U.S. invest- agreement with ment to Texas and hospitality labor California after union two failed City Council votes on a plan that sought no tax breaks or subsidies for a $164 million project, said Gerardo Carreno, asset manager for the hotel’s owners. “We are not walking away from this opportunity; we will just put it on hold and on the queue until the time is right,” Carreno told Crain’s. “In the meantime, we will focus on other markets, but we are still fully committed to Detroit with our current operation.” The Crowne Plaza’s owners submitted plans for a second tower — which was originally envisioned when the Pontchartrain was built in the mid1960s — in December and had been in talks with Ideal Group in southwest Detroit on being the general contractor.

SEE DECADE, PAGE 17

SEE HOTEL, PAGE 21

Dan Gilbert speaks as part of a panel discussion Wednesday evening at Little Caesars Arena as part of the opening night of Detroit Homecoming. See Page 18 for a roundup of Homecoming news. LARRY PEPLIN FOR CRAIN’S

FASHIONING A HUB

Effort to base clothing design, manufacturing in Detroit gains steam By Chad Livengood clivengood@crain.com

A year-old effort by current and former Detroiters to establish a hub for fashion design and manufacturing in Detroit is starting to show signs of progress. A local coalition of clothing makers that includes Carhartt Inc., Detroit Denim, Lazlo and Shinola is planning to start a pilot manufacturing plant in February that will contract with apparel companies on small clothing orders and serve as an ongoing ap-

DETROIT HOMECOMING REPORT NEXT WEEK Come back next week for a special issue that will look at the personalities, ideas and outcomes from Detroit Homecoming.

prenticeship training center. It’s one of a number of initiatives seeking to help make Detroit a fashion hub at the nexus of design and manufacturing. The nonprofit Industrial Sewing And Innovation Center (ISAIC) has

work. We get to build it from the ground up — and we can do it right by tapping into Detroit’s manufacturing DNA.” Tracy Reese, a native Detroiter whose internationally recognized clothing line is carried by Nordstrom, Bloomingdale’s and Neiman Marcus, plans to move her New York company’s design operation to Midtown, hoping to tap into a talent pool of designers coming out of the College for Creative Studies.

gained approval from the U.S. Department of Labor to operate an apprenticeship program for clothing production that will mix traditional sewing skills with the industry’s future use of robotic assembly, said Jen Guarino, vice president of manufacturing for Shinola. “What we’ve done is create a new model for a new ecosystem for apparel manufacturing in Detroit,” Guarino said last week at Detroit Homecoming V. “We don’t have to deconstruct something that doesn’t

SEE HUB, PAGE 19

ECONOMY

A decade after financial crisis, Michigan still recovering By Dustin Walsh dwalsh@crain.com

Need to know

State's GDP per capita is up but household income, ownership is down 

On Sept. 15, 2008, global financial service firm Lehman Brothers filed bankruptcy and the entire economy was sent into a tailspin. Lehman was the tip of the spear of the banking crisis that exacerbated Michigan’s “Lost Decade.” The state lost more than 800,000 jobs between 2000 and 2009 as the subprime housing bubble burst, sending hundreds

of thousands of homes into foreclosure as the automotive industry col-

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 Unemployment is down, but fewer Michiganders are actually working  Labor force participation rate dropped to 61.5 percent in July this year from a peak of 69 percent in 2001

lapsed among the rubble, leading to the bankruptcies of General Motors and Chrysler. Ten years later, things are looking up. Michigan’s gross domestic product per capita is up 21 percent from its annual low in 2009, and up 2 percent from its peak in 2005. Michigan hit bottom and the automotive industry’s rapid recovery out of the bowels of the Great Recession For instance, General Motors’ market

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Cheboygan lighthouse

CHEBOYGAN AREA CHAMBER

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OF COMMERCE

gan, seriously eurial hot spot? Cheboy

Entrepren

this morning saying as is ing through town like lonely sentinels. But cow! It’s wall-to-wall the to myself, ‘Holy next chapter in car-less, in other cities around their efforts to write the cars,’” he said. We have a say- happening back to life people and just 4,855 the book of Cheboygan. state, the stores are coming The city of Cheboygan had their appeal; here: ‘That’s Cheboygan.’ and the as shopping malls lose message ing around residents at the 2010 census, more A few years ago, this upbeat our new role as the Entrepreneur- there is traffic downtown. Parking spots in the Area Chamber With county had just 26,080. But the post, of Northern Michigan, now on the Cheboygan little tougher to find. a Capital ial he took gotten even since have have years would becoming director than two that of Commerce website ‘That’s Cheboygan’ is quickly Scott Herceg, the executive can tally up 25 businesses cry.” seemed hallucinatory. chamber, chuckles Herceg than he is. al an enthusiastic rallying Michigan, of the Cheboygan “the new entrepre- are newer to Cheboygan “Welcome to the new Entrepreneuri of new Like other cities around Entrewhen his slogan, And more than a handful downtown storefronts Capital of Northern Michigan! Northern Michigan,” of Cheboygan’s works. capital is the in are neurial Cheboygan preneurs are finding that with “for-lease” and “out-of- is read to him. He admits to a bit of hy- businesses teams, John for the fu- were hung Two husband-and-wife a place where they can invest signs. Main Street was empty perbole. But just a bit. “Hey, I was driva communi- business” stood ture and be welcomed into and its parking meters supporting of traffic ty that is enthusiastic about

By Tom Henderson thenderson@crain.com

Brian and and Marcella Costin and part of that reSharen Lange, are a big stories). Both naissance. (See related — the families came from downstateCostins the Langes from Lansing and a lot of time from St. Clair — but spent before buying in the Cheboygan area businesses. houses and starting MarcelThe Costins opened Simply Authis and 2017 la, a boutique, in June Queen’s Head gust year opened The SEE CHEBOYGAN,

PAGE 13

ness g student forges a busi The art of metal: Strugglin By Tom Henderson thenderson@crain.com

says he In a bigger city, Tom Moran undermay have just been another severe with achieving student, a kid and probadyslexia with poor grades But he grew bly not much of a future. city where he up in Onaway, a small looked out for says everyone knew and a lumberman each other. The son of six siblings got with a large family, his as hard as he As and Bs. He had to work liked what could to get Cs. But teachers him. they saw in him. They nurtured student,” “I was a nonconventional all through Moran said. “I couldn’t read words, I high school. When I wrote wrote them backwards.” Onaway Moran graduated from population in High School in 1978. Its He wasn’t the 1970 census was 1,262. He said it diagnosed while in school. the word was the early 1980s when of attena lot “dyslexia” started getting mother said, tion in the press and his “That’s what you have.” Today, Moran is an accomplished CEO of Moartist and the founder and

knew I wasn’t something in me. They but they going to be a stellar student, because we worked with me. It was people cared were a small town and

a lot of unique last year. “We worked on always go to projects, and we could out what we Moran and they’d figure mission. needed to do to solve the our expec“Moran always exceeded and under tations and came in on time dealing were budget. A lot of times we ship had run a with emergency events, happened, aground or something had was dohe and Tom would drop what help us figure ing and come over and has since Tom out what we needed to. time. He’ll do blossomed into the big lot of people the big projects that a can’t handle.”

about you.” year, MoBy the end of his freshman desks and ran was welding broken His senior chairs back into operation. nt gave year, the school superintendeto fabrieat him all the pizza he could the school’s cate a new scoreboard for a new house gym. Moran also designed Mcteacher. another for Russ McGee, to Moran’s Gee had the house built in it today. specifications and still lives city itself when Moran even helped the for a park but it had a shot at a grant application. needed a design for the got city the and design Moran did the the grant. ” said Mo“I was like Forrest Gump, ran. MORAN IRON WORKS started his After high school, Moran jobs at night 40 inches in diameter made own business, doing odd titled Sum of Us, an orb things garage, Tom Moran created a piece rented for people in a of metal. from thousands of pieces broken springs on Cheand Lewis like welding towing assemblies drafting and for wood shop in met- vettes or fabricatinglogged with his dad. thought he might be interested By day, he Need to know school had for cars. student find al working, too. The high landed his first major customJ Teacher helps struggling its metal-shop He soon sharpen jackrecently discontinued love of metal shop er, staying up all night to ut still had all the equipment hat had been dulled

Just about anything made from metal be part of a Moran’s plants used to his uncles purlarge dairy farm. One of thought of chased the farm with the for sale or subdividing it into parcels that was development, a project area’s rapidly doomed because of the 1980, Moran declining population. In there and moved his small business as a weldeventually built a pole barn he found out ing shop. After he built it, — it was conhe couldn’t get it insured in a wooden sidered a fire risk to weld

<< Cheboygan goes from zero to 60 in new businesses. Page 10 Stormy Kromer south of the bridge. Page 11

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MICHIGAN BRIEFS

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From staff and wire reports. Find the full stories at crainsdetroit.com

Stryker to acquire medical lighting firm

Kalamazoo-based medical devices manufacturer Stryker Corp. is acquiring a San Francisco-based medical tech company for $190 million. Stryker agreed to acquire all issued and outstanding shares of Invuity Inc. (NASDAQ: IVTY), which specializes in advanced lighting for surgeons, according to a news release. Stryker will buy outstanding shares of common stock for $7.40 each after the deal received approval from boards of each company. The boards of directors of Stryker and Invuity have approved the transaction. The deal is expected to be finalized in the fourth quarter. “Invuity’s innovative products in the single-use lighted instrumentation and enhanced energy markets provide best in class illumination and help make surgery safer,” said Spencer Stiles, group president of Stryker’s Neurotechnology, Instruments and Spine division. The acquisition comes on the heels of Stryker’s $1.4 billion takeover of Virginia-based K2M Group Holdings Inc. in a move that strengthens its spine surgery solutions business. Launched in 2004, Invuity developed a strong portfolio of innovative

lighting solutions for surgeons that will add to Stryker’s instruments business, according to the release. New York City-based Moelis & Co. LLC and California-based Wilson Sonsini Goodrich & Rosati PC were financial advisers for Invuity.

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KEITH CRAIN

Michigan again extends deadline for marijuana businesses

Michigan regulators last Tuesday again extended the deadline for medical marijuana businesses to be licensed, allowing 108 facilities to continue operating while warning that 98 others will be issued ceaseand-desist letters if they do not close by the end of the week, the Associated Press reported. Gov. Rick Snyder signed the new emergency rules issued by the Department of Licensing and Regulatory Affairs. They allow certain proposed medical marijuana businesses, which would otherwise need a state license, to continue operating until Dec. 15 as long as they have secured local approval. Regulators previously ordered the closure of more than 200 other businesses largely because their owners had failed to apply for a license in time or had not received authorization from their municipalities. This is the third time the licensing deadline has been extended or softened as the state continues the pro-

CALENDAR

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Michigan regulators last Tuesday again extended the deadline for medical marijuana businesses to be licensed.

cess of more tightly regulating the medical marijuana industry under a 2016 law. Last November, the state allowed businesses to stay open while seeking a license, a reversal after it initially gave dispensary shops a deadline to close or potentially risk not obtaining a required license to grow, process, sell, transport or test marijuana. Then in May, regulators pushed the deadline from June 15 to Sept. 15. Now it is Dec. 15.

Twenty-seven applicants have been approved for licensure but have not been issued a license yet. Ten applicants have received a license but will be able to return it to keep operating under the same rules as unlicensed businesses.

Coca-Cola plant in Kalamazoo to close

Great Lakes Coca-Cola Distribution LLC is planning to lay off 102 employees and close a bottling and

OPINION

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RUMBLINGS

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distribution plant in Kalamazoo. Some employees may be transferred to other Michigan sites, but it’s unclear how many. The plant at 216 Peekstock Road, which distributes beverages under the Atlanta-based Coca-Cola Co. brand, will be shut down by Nov. 5, according to a notice filed with the state. Of the total affected employees, 69 are represented by the local affiliate of the Washington, D.C.-based labor union International Brotherhood of Teamsters. There are no bumping rights. Layoffs are “to the extent that employees are not offered or do not accept a transfer position to another facility in Michigan,” the notice said. Most affected employees will be transferred to operations in Grand Rapids and Lansing, Coca-Cola said in a statement published by MLive. Great Lakes Coca-Cola is a subsidiary of Reyes Holdings LLC, an Illinois-based foodservice wholesaler and distributor. It operates 14 plants throughout the state, according to its website.

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SPORTS BUSINESS

The Detroit Red Wings enter Little Caesars Arena last fall. JACOB LEWKOW FOR CRAIN’S

The Detroit Pistons moved to Detroit to play at Little Caesars Arena. LARRY PEPLIN FOR CRAIN’S

LCA likely will near top of world’s most-attended arenas this year Little Caesars Arena will almost certainly end 2018, its first full calendar year of operation, as one of the most-attended arenas in the world. Concert industry trade magazine Pollstar publishes an annual worldwide arena ranking based on ticketed events (excluding pro sports team games). Atop the full-year 2017 list was the O2 in London (1.4 million tickets sold), Madison Square Garden in New York City (1.1 million), Manchester Arena in England (1 million) and The SSE Hydro in Scotland (1 million). It’s unclear where LCA will fall for its calendar-year 2018 events (which are subject to tour scheduling), but it should be in the top 10, or could even top the list. Little Caesars was open for less than four months in 2017, but was 83rd in the world with 240,727 tickets sold last year.

Subtracting out Red Wings’ and Pistons’ attendance to produce an estimate suggests that LCA could have about 1.5 million ticketed attendance for 2018. That potentially makes it the most-attended arena in the world. “We’re fairly confident we’re going to finish in the top 5 in North America and hope to finish in the top 10 in the world,” said Chris Granger, hired in 2017 as Ilitch Holdings group president for sports and entertainment. The Ilitch family oversaw the arena’s construction and financing, and operates the publicly owned arena under a longterm lease. “We’re proud of the incredible diversity of events in the first year,” Granger said, noting that the lineup beyond sports included hiphop, rock, pop, comedy, family and coun-

try shows. “The programming has done a nice job of providing something for everyone in Detroit.” LCA, built with $863 million in public and private financing, in May was named the 2018 Sports Facility of the Year at the 2018 Sports Business Awards ceremony by SportsBusiness Journal and SportsBusiness Daily. It bested Notre Dame Stadium, SunTrust Park/The Battery Atlanta, T-Mobile Arena (Las Vegas), Target Center (Minneapolis), and U.S. Bank Stadium (Minneapolis). The award is based on excellence, growth, creativity, innovation, sound planning, implementation and outcomes. “The company we’re in are the best buildings in the world. To be mentioned in that group is something we’re really proud of,” Granger said. — Bill Shea

Little Caesars Arena, Year 1, by the numbers Here are some facts about attendance at Little Caesars Arena over its first year of operation:

Number of concerts Kid Rock put on to open the venue, starting Sept. 12, 2017. Total reported attendance was Kid Rock 86,893.

318

Total number of events in the arena’s first year.

2.4 million

Ticketed attendance through Aug. 4, a Shakira concert.

3 million

Milestone for ticketed attendance projected to be hit in November.

800,115

Fans who attended the Red Wings’ 41 regular-season home games, fourthbest in the 31-team NHL.

713,945

Fans who attended the Pistons’ 41 regular-season home games, 18th-best in the 30-team NBA. JACOB LEWKOW FOR CRAIN’S

MUST READS OF THE WEEK Federal-Mogul acquisition approved Tenneco shareholders approve $5.4 billion Federal-Mogul acquisition. Page 7

New worries for working spouses of visa holders By Dustin Walsh dwalsh@crain.com

Bhargavi Kondasani runs a certified in-home day care in Lyon Township. Once a grade-school teacher in India, Kondasani opened her home to four children in February with plans to become an employer by hiring an assistant caregiver next month to accommodate two more kids. But her business and others in Southeast Michigan may be in jeopardy as the Trump administration is mulling an idea to stamp out a class of immigrant visa-holders, poten-

Need to know

Trump administration plans to rescind work authorization given to some of the nearly 100,000 H-4 visa holders employed in U.S. 

 Locally, roughly 15,000 H-1B visa status applications have been approved since 2010  Removing work status of H-4 visa holders would strain family finances, study says

tially removing Kondasani from being able to work in the U.S. In a court filing in August, the administration indicated it plans to re-

scind a work authorization given to some of the nearly 100,000 H-4 visa holders now employed in the U.S. H-4 is a visa designation given to spouses and children of H-1B visa workers. They were commonly called “involuntary housewife visas” by immigrants prior to 2015, when the Obama administration approved a rule to allow some of the H-4 visa holders to gain employment. H1-B visas are a temporary visa category that allows employers to hire highly educated foreign workers in “specialty occupations” that require at least a bachelor’s degree

or equivalent. Jobs in fields such as mathematics, engineering and technology often qualify. Work visa programs, established under President Harry Truman in 1952, were designed to allow U.S. companies to hire foreign workers temporarily when qualified American workers were in short supply. But the programs have come under criticism in recent years from allegations that companies, particularly India’s technology conglomerates, are abusing the visas to access cheaper labor. SEE VISAS, PAGE 20

New Summit Place Mall owner sees mixed uses for site By Kirk Pinho kpinho@crain.com

Road projects facing delays More than 160 road construction projects in Michiigan affected by union lockout. Page 4

The new owner of the Summit Place Mall property in Waterford Township envisions a mixed-use development at the decaying site on the township’s border with Pontiac. Arie Liebovitz, president of Southfield-based Ari-El Enterprises Inc., said Tuesday that office, flex space, casual dining and even hotel uses could be built on the 74-acre property at Telegraph and Elizabeth Lake roads. Between 900,000 and 1 million square feet of new space could be accommodated, he said in an interview

with Crain’s. In a press release, Ari-El says that financing from an Opportunity Fund, which is allowed under a new federal tax provision enacted last year, could be used to help pay for the redevelopment. Such funds receive capital gains from the sale of things like real estate or stock and reinvest them into low-income Census tracts. Liebovitz declined to give specifics on possible tenants or number of buildings anticipated, but said he plans to have the redevelopment complete “as soon as possible.” SEE SUMMIT, PAGE 20

KIRK PINHO / CRAIN’S DETROIT BUSINESS

The new owner of Summit Place Mall envisions office, flex space, casual dining and even hotel uses could be built on the 74-acre property at Telegraph and Elizabeth Lake roads.

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Cranes sit idle last week at a construction site to rebuild the Gratiot Avenue overpass at I-94 in Detroit.

More than 160 road projects in Michigan affected by union lockout By Tyler Clifford tclifford@crain.com

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A total of 161 state or local road construction projects across Michigan are at partial or full shutdown due to an ongoing labor lockout. Work stoppage due to a contract impasse has impacted 89 MDOT projects and another 72 projects being overseen by local road agencies, the Michigan Department of Transportation told Crain’s Tuesday. MDOT identified 30 statewide projects that aren’t currently shut down. The standoff between the Michigan Infrastructure & Transportation Association and Operating Engineers Local 324 is going on three weeks old with no signs of progress. More than 1,000 heavy equipment workers across the state have not reported to their worksites since the trade group instituted a “defensive lockout” just after Labor Day. Major road projects on I-696, I-75 and I-96 in Southeast Michigan have been affected by the dispute in a region that has cringed about its crumbling roads for years. The $90 million I-696 project, which was awarded to Interstate Highway Construction in Colorado, was scheduled to be completed in November. It is unclear how the labor stoppage will affect that timeline or others across the state. A representative with Interstate Highway Construction could not be reached for comment. “I-696 and I-75 are completely shut down,” MITA Executive Vice President Mike Nystrom said last week. “There might be some small bits of work happening” unrelated to heavy equipment work. Some companies are using nonunion subcontractors and out-ofstate heavy equipment operators to continue projects, Nystrom said last week.

Need to know

JJMajor road projects on I-696, I-75 and

I-96 in Southeast Michigan stalled or shut down JJStandoff enters its second week with no signs of progress JJIndustry group, union at odds over new contract negotiation

Four contractors that MDOT recently chose as preferred bidders to complete the final stretch of the elephantine I-75 modernization project are also represented by MITA, which has about 40 road companies under its umbrella. Those include Shelby Township-based Dan’s Excavating Inc., Troy-based Ajax Paving Industries Inc., Detroit-based Jay Dee Contractors and Commerce Township-based CA Hull Co. Heavy equipment work is also idle on the Gratiot Avenue overpass at I-94 and the I-75 River Rouge Bridge, which is also being led by Dan’s Excavating. Contractors have deferred comments to the trade group. About 80 percent of active road contracts across the state of Michigan have been awarded to companies represented by MITA, which has been negotiating contracts in the state for over 80 years, Nystrom said. He admits negotiating contracts is tough, but said he’s never seen an impasse like this one. “We haven’t heard from the union as we said from the beginning. The lockout will end when they ratify our proposed contract,” Nystrom said. “However, the contractors are willing to talk. We’re just waiting to hear from the union.” Tensions between the two parties began building after a five-year contract ended June 1. Work continued on construction projects for three months before the lockout was instituted by MITA last Tuesday.

Union spokesman Dan McKernan told Crain’s Monday that the Local 324 had not heard from MITA, but stressed that its members are ready to work, which is “contingent on the employers.” The union has no interest in negotiating a new contract with MITA; instead, the union wants contractors affiliated with MITA to sign on to a new master agreement it negotiated directly with companies. McKernan said dozens of contractors, including some represented by MITA, have signed on to the statewide deal, but he would not provide details, saying he was concerned about retaliation. Nystrom said some companies relinquished their power of attorney with MITA in early August to open dialogue with OE Local 324, but that most contractors have since returned to the trade group. “Nobody we are aware of signed that contract,” he said. However it’s resolved, the situation may not produce any winners. Union members have reportedly begun filing for unemployment benefits and construction companies can be subject to costs incurred from construction delays. But as the dispute continues, drivers will certainly not be the winners, motoring past work in limbo on busy freeways. The Michigan Department of Transportation, which is not involved in the dispute, is holding contractors accountable to maintain work zone safety during the work stoppage. Per its contracts with road builders, the agency must allow for project extensions that could bring upon additional costs to the contractors. “Officials at MDOT take delays very seriously, working very hard to alleviate congestion and the inconvenience to drivers,” MDOT said in a statement provided by spokesman Jeff Cranson. “So, of course, we hope the two sides reach agreement soon.”

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Credit cards help Lafayette feed corporate demand By Chad Livengood clivengood@crain.com

Some will call it keeping up with the times. Others may deride it as a form of gentrification. But Lafayette Coney Island, a downtown Detroit mainstay since the 1920s, recently made a 21st century business move and is now accepting Visa, Mastercard, Discover and American Express. The owners of the longtime cash-only coney dog establishment on Lafayette Boulevard had a credit card machine installed three weeks ago after watching plastic-carrying customers walk away and downtown companies seek catered lunches elsewhere because they only accepted greenbacks for payment. It’s the probably biggest change to Lafayette Coney Island since they installed a fryer in 1990 and added french fries to the menu. “It’s time to change so the customer keeps coming,” said Ali Alhalmi, a part owner and longtime cook at Lafayette, where he’s worked behind the street-facing grill for 42 years. “A lot of customers don’t carry cash like they used to.”

Ali Alhalmi, a part owner and cook at Lafayette Coney Island, fills a counterside coney dog order from Frederick Harris, a demolition contractor who stopped into the eatery for lunch Monday. CHAD LIVENGOOD/ CRAIN’S DETROIT BUSINESS

Need to know

JJDowntown Detroit mainstay since the 1920s took cash only until recently JJFewer customers carry cash these days

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JJRestaurant was giving up large corporate orders

Call it leveling the playing field with rival American Coney Island, which has long accepted credit cards and offered a larger menu than its coney dog competitors next door. “Welcome to the new era,” said Grace Keros, co-owner of American Coney Island, which celebrated its 100th anniversary last year. Cash is rapidly becoming a disappearing form of payment for younger adults — and Lafayette Coney Island is not alone in putting the logos of major credit card companies on its glass doors on Lafayette and Michigan avenues. Nemo’s Bar, an old-school Corktown watering hole, is now accepting credit card payment for its burgers and stiff drinks. “Sometimes you got to break tradition,” said George Benavides, 65, who’s been going to Lafayette since he was 6 years old. But there are still some holdouts throughout Detroit: Sonny’s Ham-

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Lafayette Coney Island at 118 W. Lafayette Blvd. in Detroit recently began taking credit cards for payment after being a cash-only dining establishment since opening in the mid-1920s. CHAD LIVENGOOD/ CRAIN’S DETROIT BUSINESS

burgers in Brightmoor, Motz’s Burgers in Delray, Family Treats on Springwells and Taqueria El Rey and Taqueria Lupitas in Southwest Detroit. The owners of Duly’s Place coney island on West Vernor Highway responded Monday to news of Lafayette accepting plastic by explaining the credit card fees small businesses have to absorb — or pass along to customers — for the convenience. “We know some of our customers would like us to take credit cards, but ummm not so much for us at Duly’s. Bring cash — it’s what we like in Southwest!” Duly's Place wrote on its Facebook page. The owners of Lafayette Coney Island admit they were feeling the pressure to cater to a changing downtown workforce. About seven years ago, Lafayette had an ATM machine installed to direct patrons to use their bank debit cards to get cash and pay their tab. But some didn’t want to get charged the $3 service fee, Alhalmi said. “We need the customer to be happy,” said Abdo Saleh, another partner in the restaurant who works behind the main counter, usually shouting orders to Alhalmi. Alhalmi said that in recent years they’ve gotten calls from downtown

businesses such as Quicken Loans Inc. seeking to buy 100 or more coney dogs for a company lunch. At $2.80 for each chili dog, the callers would ask if they could use a company credit card for a nearly $300 order, he said. Each time, they had to turn away the business. “Sometimes, they come in and go next door,” Alhalmi said. “And I feel bad.” The restaurant’s owners figure they can absorb the 3 percent credit card company charges if they pick up more catered lunch orders from downtown customers — business that’s likely been going to American or another restaurant that sells Detroit-style dogs. “It was a long time coming. I wish they had done it before,” said Detroiter Darwin Hudnall, 51, who’s been going to Lafayette since he was 17. “If they delivered, that would be even better.” Alhalmi insisted nothing else about the place is going to change. The men who work in there still don’t give customers a written check like most restaurants. “They still gotta figure it out in their head,” said Benavides, who picked up two coneys “with everything” Monday morning on his way to work at Comerica Park.

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Tenneco shareholders approve $5.4B Federal-Mogul acquisition Shareholders of Tenneco Inc. approved proposals needed for the companyâ&#x20AC;&#x2122;s $5.4 billion acquisition of Southfield-based auto parts maker Federal-Mogul Inc. from billionaire investor Carl Icahn, Tenneco said Wednesday. The company said in a statement that the deal has received all necessary regulatory approvals, and they expect it to close Oct. 1. The acquisition is a step toward their ultimate goal of separating back into two new public companies â&#x20AC;&#x201D; one focused on replacement auto parts and the other on powertrain technology. Now, both companies compete in both sectors. The companies said in April that split is expected to happen in the first half of next year. Lake Forest, Ill.-based Tenneco

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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 // S E P T E M B E R 1 7 , 2 0 1 8

OPINION ‘DETROIT RISING’

EDITORIAL

Council drops ball on Crowne Plaza

ity Council roadblocks have cost Detroit a much-needed hotel project, and there’s no good reason that should have happened. The council for the second time last week voted against rezoning for a proposed second tower of the Crowne Plaza (formerly known as the Hotel Pontchartrain). The owners now say they’re putting the project on hold indefinitely in favor of building a hotel in Houston (see story, Page 1). The reasons are nebulous at best. Various councilpeople have complained about the quality of the hotel’s housekeeping, voiced a desire to get employees’ pay to $15 an hour and referenced a failed unionization drive at the hotel dating to 2015. None of these are reasons to reject a plan that would be a clear win for a city that needs hotel rooms in large blocks. It’s true Detroit is experiencing a hotel construction boom, but most of those projects are smaller, boutique hotels like the Foundation Hotel or the Shinola hotel that is still in the works. Event organizers have cited a dearth of hotels that can offer large blocks of rooms, several hundred or more. The deficiency was seen as a key reason the NCAA passed up the city when awarding men’s basketball Final Four bids earlier this summer. The Crowne Plaza’s owners, a Mexican investment group called Operadora de Servicio Para Hoteles de Lujo, want to build the 500-room second tower, which would seem to fill that bill nicely. The location just across Washington Boulevard from Cobo Center is a bonus. The owners aren’t asking for any taxpayer money. The project would add 250 jobs in the city. It seems like a no-brainer. Not for the council members who have now twice rejected it. They are far exceeding their mandate by interposing themselves into management-labor relations and room cleanliness. We may be going out on a limb, but we’d bet there are plenty of lodgings in the city that are more dingy. If this were Detroit’s “bad old days,” we would wonder if the hotelier failed to make campaign contributions to the right council members. But another motive is apparent in the latest request from the council members — to secure a pledge by hotel management of a neutral stance toward another unionization effort. What unionizing has to do with zoning is beyond us. Playing labor politics in a way that costs the city jobs and hotel rooms (which could help secure more jobs through more convention business) is just plain wrong.

JEFF HUARD/SPOTLIGHT RADIO NETWORK

Detroit Economic Growth Corp. CEO Kevin Johnson speaks with Crain’s Senior Reporter Chad Livengood for an interview on the “Detroit Rising” podcast at Louisiana Creole Gumbo, 13505 W Seven Mile Road, in Detroit.

Talent, not poaching, driving business moves to Detroit, DEGC CEO says D

etroit Economic Growth Corp. CEO Kevin Johnson pushes back on the notion that Detroit is poaching companies from the suburbs. Johnson came to Detroit this summer from Atlanta, where he was a senior vice president for economic development for Invest Atlanta. In Georgia’s biggest city, Johnson was involved in bringing a new headquarters for Porsche Cars North America Inc. to Atlanta. From that experience and others working in economic development in multiple states, Johnson has arrived at his own conclusion about the driving force for companies moving into urban areas. “The No. 1 person, in my opinion, as to who makes and influences real estate decisions right now is the director of human resources,” Johnson said in an interview for the Crain’s “Detroit Rising” podcast. “The talent is determining where corporations make real estate decisions.” In this region, though, that decision-making doesn’t sit well with some suburban political leaders who have found themselves in sudden competition with Detroit — for both businesses and workers. Quicken Loans Inc. arguably be-

CHAD LIVENGOOD clivengood@crain.com

gan the march downtown from Livonia in 2010. Other companies such as Microsoft, Google and now Chemical Bank have followed suit. Ford Motor Co. may be the most striking recent example after the Dearborn automaker bought the derelict Michigan Central Station and other eyesore properties in Corktown and began making plans to move 2,500 workers from Dearborn to Detroit by 2022. Ford plans to plant its autonomous and electric vehicle development teams in the train station and other Corktown buildings, which the company has said will have capacity for 2,500 additional contractors. Johnson, who is paid to promote Detroit, suggested companies would be foolish not consider where their

current and prospective employees want to work. “I think it’s wise to listen to your workforce,” Johnson said. “I think it’s wise to take advantage of a market that has assets that you can go in and revitalize and stabilize neighborhoods. They will benefit from that for generations by making these kind of decisions.” Also in the podcast interview, Johnson said Ford’s plans for a Corktown campus have spurred interest from other companies that have called the DEGC to learn about setting up shop in Detroit’s oldest neighborhood. Detroit has to start assembling and preparing land for development by suppliers and “multiplier” companies seeking to follow Ford to Detroit, Johnson said. “What we have to do is be ready,” he said. “If we stay ready, we don’t necessarily have to get ready.” The “Detroit Rising” podcast is a weekly feature profiling people and issues in business, nonprofits and government in Detroit. If you've got a story idea to feature on the podcast, email me at clivengood@crain.com or call me at (313) 446-1654.

Lots of great opportunity

ast week, once again, the Detroit Homecoming, produced by Crain’s Detroit Business, was by all accounts a smashing success. And one of the points discussed often during the three days of sessions was just how many opportunities there still are in the city of Detroit. There is plenty of room to run in real estate. Dan Gilbert is a pioneer, but there are still lots of opportunities available all across the city. Want to start a business? Neighborhoods are crying out for inves-

KEITH CRAIN Editor-in-chief

tors who are interested in starting everything from, yes, more restaurants, to all sorts of local businesses

from grocery stores to dry cleaners to you name it. If it is something that you or your foundation might be interested in doing, there are lots of philanthropic projects just waiting for generous donors. Everything from parks to education is available to generous donors. What has been done has had huge impact. The city needs more. Don’t get the idea that it is too late, and if you were not an investor five years ago, you missed the window of opportunity. Don’t let any-

one fool you: There is plenty left. Detroit is on the rebound, and it shows. Happily, the world is noticing what is going on here. And even more importantly, there seem to be plenty of folks from all over the nation who want to get involved with the hometown they left decades ago. Lucky for us, once a Detroiter, always a Detroiter. Your blood is still Detroit blood. We are happy to invite back every year lots of folks who still feel like they belong to our city. And for the past five years, we

have helped them refresh those feelings. They also discovered the awesome opportunities that still abound here. It was an exciting three days.

More on WJR Hear Crain’s Group Publisher Mary Kramer and Managing Editor Michael Lee talk about the week’s stories every Monday morning on WJR 760 AM’s Paul W. Smith Show.

C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 1 7 , 2 0 1 8

Westland to seek proposals to develop 100-acre site By Kirk Pinho kpinho@crain.com

Westland expects to issue a request for proposals to develop about 100 acres of largely vacant land early next year. It’s the latest example of a metro Detroit community going to the real estate market with large chunks of land for redevelopment, following Troy, Commerce Township and Southfield, among others. The Westland property, which contains the 40-acre site of the former city hall that was demolished two years ago, is large enough for approximately 700 single-family home units plus retail and restaurant uses, said Charles House, the city’s economic development director. “Where in Wayne County are you going to find 100 acres that’s going to be contiguous with a half mile of frontage along a major thoroughfare like Ford Road?” House said. “The ultimate goal is to create the proverbial central place.” Robert Gibbs, an urban planner who is principal of Birmingham-based Gibbs Planning Group, is working on the property’s master plan with Northville-based McKenna Associates. A series of visioning sessions about the property were held last week. “Options include expanding the park, building a square surrounded with a village of residential and small shops,” he said. “We are exploring planning a small neighborhood with a variety of housing types, a cafe, shops and a nature park.” He said about 30 percent of the residents in a five-mile radius of the property sandwiched south of Ford Road between Newburgh Road and Carlson Street have a college degree and the average household income is about $80,000 per year. Gibbs said a lot of communities are taking their large owned properties to the market because of demand for in-fill sites surrounded by already existing developments. “That’s a big trend,” Gibbs said. Troy has planned a large-scale development on the 127-acre Troy civic center campus off Big Beaver Road, but that project has stalled after the city went to the development community with a request for qualifications. Among the snags in the effort were a ballot initiative last year that, although unsuccessful in a 57-43 vote, attempted to thwart the project, and the city manager who spearheaded the project being fired in March for domestic violence and pleading guilty last month to accepting thousands of dollars in bribes. Southfield has been making progress with the 125-acre Northland Mall site it owns, tearing down structures and talking with developers like Southfield-based General Development Co. and Bloomfield Hills-based Edward Rose & Sons, plus a San Diego health care company, for various portions of the property near Eight Mile and Greenfield roads. And the $100 million first-phase of Robert B. Aikens LLC’s Five &

Main project in Commerce Township on 55 acres is progressing with site plan work and developer negotiations. The project is part of a broader vision for 300 acres acquired by the township’s downtown development authority at M-5 and Pontiac Trail. Kirk Pinho: (313) 446-0412 Twitter: @kirkpinhoCDB

The Westland property contains the 40-acre site of the former city hall that was demolished two years ago.

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FOCUS

CRAIN’S MICHIGAN BUSINESS: NORTHEAST MICHIGAN In this package

Entrepreneurial hot spot? That’s Cheboygan . This Page 

Struggling student finds calling, founds Moran Iron Works. This Page 

Stormy Kromer to open first lower-peninsula shop in Cheboygan. Page 11 

Brothers keep gluten-free food business in Michigan. Page 12 

Online

A tiny invention makes a big impact in Alpena 

Boat-themed bar does brisk business 

Cheboygan lighthouse CHEBOYGAN AREA CHAMBER OF COMMERCE

Entrepreneurial hot spot? Cheboygan, seriously By Tom Henderson thenderson@crain.com

A few years ago, this upbeat message now on the Cheboygan Area Chamber of Commerce website would have seemed hallucinatory. “Welcome to the new Entrepreneurial Capital of Northern Michigan! Entrepreneurs are finding that Cheboygan is a place where they can invest for the future and be welcomed into a community that is enthusiastic about supporting

their efforts to write the next chapter in the book of Cheboygan. We have a saying around here: ‘That’s Cheboygan.’ With our new role as the Entrepreneurial Capital of Northern Michigan, ‘That’s Cheboygan’ is quickly becoming an enthusiastic rallying cry.” Like other cities around Michigan, Cheboygan’s downtown storefronts were hung with “for-lease” and “out-ofbusiness” signs. Main Street was empty of traffic and its parking meters stood

car-less, like lonely sentinels. But as is happening in other cities around the state, the stores are coming back to life as shopping malls lose their appeal; there is traffic downtown. Parking spots have even gotten a little tougher to find. Scott Herceg, the executive director of the Cheboygan chamber, chuckles when his slogan, “the new entrepreneurial capital of Northern Michigan,” is read to him. He admits to a bit of hyperbole. But just a bit. “Hey, I was driv-

ing through town this morning saying to myself, ‘Holy cow! It’s wall-to-wall people and cars,’” he said. The city of Cheboygan had just 4,855 residents at the 2010 census, and the county had just 26,080. But in the more than two years since he took the post, Herceg can tally up 25 businesses that are newer to Cheboygan than he is. And more than a handful of new businesses are in the works. Two husband-and-wife teams, John

and Marcella Costin and Brian and Sharen Lange, are a big part of that renaissance. (See related stories). Both families came from downstate — the Langes from Lansing and the Costins from St. Clair — but spent a lot of time in the Cheboygan area before buying houses and starting businesses. The Costins opened Simply Marcella, a boutique, in June 2017 and this August year opened The Queen’s Head SEE CHEBOYGAN, PAGE 13

The art of metal: Struggling student forges a business By Tom Henderson thenderson@crain.com

In a bigger city, Tom Moran says he may have just been another underachieving student, a kid with severe dyslexia with poor grades and probably not much of a future. But he grew up in Onaway, a small city where he says everyone knew and looked out for each other. The son of a lumberman with a large family, his six siblings got As and Bs. He had to work as hard as he could to get Cs. But teachers liked what they saw in him. They nurtured him. “I was a nonconventional student,” Moran said. “I couldn’t read all through high school. When I wrote words, I wrote them backwards.” Moran graduated from Onaway High School in 1978. Its population in the 1970 census was 1,262. He wasn’t diagnosed while in school. He said it was the early 1980s when the word “dyslexia” started getting a lot of attention in the press and his mother said, “That’s what you have.” Today, Moran is an accomplished artist and the founder and CEO of Moran Iron Works Inc., which annually vies with the Michigan Limestone and Chemical Co. in Rogers City, which operates the world’s biggest limestone quarry, as the largest employer in Presque Isle County. He employs almost 100 and expects revenue this year of about $16 million. That’s down from a peak of $25 million when his company had several unusually large projects, including fabricating Consumers Energy’s largest greenhouse reduction

MORAN IRON WORKS

Tom Moran created a piece titled Sum of Us, an orb 40 inches in diameter made from thousands of pieces of metal.

Need to know

Teacher helps struggling student find love of metal shop 

 Today, Tom Moran is an artist and founder and CEO of Moran Iron Works

system in West Olive, Mich., one component of which was the largest single thing Moran Iron has ever made at 200 tons. A shop teacher named Bob Lewis may have had the biggest impact on the struggling student as he began high school. Moran showed an affinity for

drafting and for wood shop and Lewis thought he might be interested in metal working, too. The high school had recently discontinued its metal-shop class but still had all the equipment and tools. Lewis wrote him a pass that got Moran out of study hall for the year, and he basically gave Moran a one-student metal-shop class. “I was enamored with welding. I have a picture of Bob Lewis sitting in front of me on my desk,” said Moran. “He was one of the most influential people in my life. But I had more than my share of excellent teachers who saw

something in me. They knew I wasn’t going to be a stellar student, but they worked with me. It was because we were a small town and people cared about you.” By the end of his freshman year, Moran was welding broken desks and chairs back into operation. His senior year, the school superintendent gave him all the pizza he could eat to fabricate a new scoreboard for the school’s gym. Moran also designed a new house for Russ McGee, another teacher. McGee had the house built to Moran’s specifications and still lives in it today. Moran even helped the city itself when it had a shot at a grant for a park but needed a design for the application. Moran did the design and the city got the grant. “I was like Forrest Gump,” said Moran. After high school, Moran started his own business, doing odd jobs at night for people in a rented garage, things like welding broken springs on Chevettes or fabricating towing assemblies for cars. By day, he logged with his dad. He soon landed his first major customer, staying up all night to sharpen jackhammer chisels that had been dulled during the day for Durocher Dock & Hoist in Cheboygan as it did refurbishing work on the Soo Locks. Durocher remains a customer today. “We’re in the marine construction business and have been at it a long time,” said Joe VanAntwerp Jr., Durocher’s founder and CEO, who retired

last year. “We worked on a lot of unique projects, and we could always go to Moran and they’d figure out what we needed to do to solve the mission. “Moran always exceeded our expectations and came in on time and under budget. A lot of times we were dealing with emergency events, a ship had run aground or something had happened, and Tom would drop what he was doing and come over and help us figure out what we needed to. Tom has since blossomed into the big time. He’ll do the big projects that a lot of people can’t handle.”

Just about anything made from metal Moran’s plants used to be part of a large dairy farm. One of his uncles purchased the farm with the thought of subdividing it into parcels for sale or development, a project that was doomed because of the area’s rapidly declining population. In 1980, Moran moved his small business there and eventually built a pole barn as a welding shop. After he built it, he found out he couldn’t get it insured — it was considered a fire risk to weld in a wooden building. As business picked up, he built concrete and metal additions to the original pole barn, a total of 34 additions in all. And he bought another five acres of land. “I bought 114 acres five acres at a time, which was all I could afford,” he said. SEE MORAN, PAGE 12

C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 1 7 , 2 0 1 8

SPECIAL REPORT: NORTHEAST MICHIGAN

Stormy Kromer ventures south of the bridge By Tom Henderson

Need to know

thenderson@crain.com

There’s big news coming to the city of Cheboygan: Stormy Kromer is coming to town. Until now, the clothing manufacturer known for its iconic winter cap with ear flaps has had just one store, a factory store in its headquarters of Ironwood in the far western reaches of the Upper Peninsula, so far west the city is on Wisconsin time. Retailers around the state and Midwest carry only a limited range of Stormy Kromer items. Cabela’s and Dunham’s Sporting Goods carry hats and other items. Small independent retailers carry mostly hats. Now, though, the first nonfactory store dedicated exclusively to the entire range of Stormy Kromer products is scheduled to open in late fall on Main Street in downtown Cheboygan. The store is part of a four-building makeover in the 200 North Main Street block by Marcella and John Costin that is a key component to the widespread renovation going on downtown. She has been selling some Stormy Kromer items in her Simply Marcella boutique, which opened on Main Street in June 2017, but as she and her husband have expanded business operations to the boutique’s three adjacent buildings, she decided she needed a store dedicated to Stormy. The wool cap has been a musthave piece of apparel for outdoor enthusiasts since it was invented in 1903. George (Stormy) Kromer had been a semi-professional baseball player, but when it became clear he wasn’t going to make a living playing ball, he took a job as a railroad engineer. He got tired of having his caps blow off while manning his train and asked his wife, Ida, to design something better. The result was a modified baseball cap with flaps that kept the hat firmly in place. Stormy and Ida formed the Kromer Cap Co. in 1903 and built a factory in Milwaukee. In 2001, the Kromer Cap Co. announced it was going to stop making the hats, the rights to which were then bought by Jacquart Fabric Products Inc., which moved production to Ironwood. Production of the caps skyrocketed, from fewer than 10,000 a year to more than 50,000. The product line was expanded and now includes flannel shirts, wool jackets, pullovers, cotton vests, tees and long-sleeved cotton shirts, vests and hoodies. Jeff Daniels, the actor and Michigan resident, has long been a fan of the Stormy Kromer hat and frequently wears one on his various TV appearances. He even wrote a piece for the Stormy Kromer web site about wearing his hat in Manhattan. “Every time I wear my brimless Stormy Kromer on the streets of New York City I get looks, which is saying something because it’s hard to catch the eye of a native New Yorker. They tend to be elsewhere. It has a lot to do with having seen everything there is to see and knowing everything there is to know. After a half dozen double takes, I started answering the unanswerable. ‘It’s a Stormy Kromer.’” So, when Gina Thorsen, the president of the Stormy Kromer division at Jacquart, heard from a sales rep that a

JJScheduled to open in late fall on Main Street in downtown Cheboygan JJPart of a four-building makeover by Marcella and John Costin JJBoutique, pub among other businesses the couple has opened

Marcella and John Costin at Simply Marcella’s, their boutique in downtown Cheboygan.

AARON PETERSON

The Stormy Kromer wool cap has been a must-have piece of apparel for outdoor enthusiasts since it was invented in 1903.

new business in Cheboygan wanted to open a Stormy store, she wanted to protect the brand. It wasn’t going to be a company store, she would have no control over its operations and would need to vet the would-be owner. “I already had a trip scheduled to the Lower Peninsula last spring, so I coordinated a visit to Cheboygan. I sat down with Marcella and her husband for dinner, and it was one of those cases where you feel you've known someone your whole life,” said Thorsen. The next day, the Costins took her on a tour of their buildings and shared their plans for them, including one building whose 1,000 square feet would be dedicated to Stormy Kromer. “It was incredibly impressive. Construction was already under way. I was blown away,” said Thorsen. “I know how important it is to revitalize the downtowns of small towns, and I know the Costins will do right by the Stormy name.” There will be one exception to the Stormy Kromer-only products in the

store. The Costins will sell a Stormythemed beer made in Cheboygan, marketing it with the motto: “A frosty head only looks good on a beer.”

Other business ventures In late August, the official grand opening and ribbon cutting was held at another of the Costins’ ventures in Cheboygan, The Queen’s Head wine pub, though it had been open for a month and the Costins say it had been packed most nights. The small pub is behind Simply Marcella and can be entered either through the Marcella’s entrance on North Main or through a door off the parking lot around the block. Though called a wine pub and serving a wide range of wines at prices ranging from $18 to $114 a bottle, a variety of cocktails and beer are available, too. The pub seats 38 inside and about 25 outside, weather permitting. The modestly priced food includes a variety of gourmet cheeses, appetizer platters, soups and seafood dips. The name of the pub and

TONY JOHNSON

the name of some of its platters — the Queen Mary’s platter, the Queen Anne’s peasant platter and the Queen Caroline platter — can be traced to John Costin’s native England. He was an executive with General Motors from 1992-2007; owned his own St. Clair-based consulting firm from 2008-2010; was president of Helsinki-based Delta Motor Group from 2010 to 2012 and was its chairman for another year after moving back to St. Clair; and has been president of Troy-based Humvee Export LLC since 2012. Marcella taught theater and language arts in the East China school district for 22 years. A lover of pearls who thought them too expensive, in 2005, she began a hobby business out of the basement of her St. Clair house designing and importing pearl-based jewelry. She began selling to her teacher friends, hosted shows at her house and at her friend’s houses, then in 2010 opened her first Simply Marcella boutique in what had been a Gulf gas station across from the St. Clair Inn. She opened another Simply Marcella in Lake Orion in 2012. She continued teaching for a while but quit to move briefly to Helsinki with her husband. The Costins had frequently taken their boat from St. Clair to Cheboygan. In 2012, they had propeller trouble and had to dock in Cheboygan to get it fixed. They went for a walk, saw a property they liked on Lake Huron, bought it and ended up buying the house on the lot next door. In 2014, John was diagnosed with leukemia and given a year to live, but a stem cell transplant in Boston proved successful and he has been declared cancer-free. In the fall of 2015, “I woke up one day and said to John, ‘There’s a cute little store downtown. I wonder what the chances are they’ll give me

a short-term lease,’” recounted Marcella. What she had in mind was a pop-up store in an empty storefront in the 200 block of N. Main Street to sell Simply Marcella merchandise. The idea popped into her mind on a Monday. Eight days later she opened the pop-up. It did land-office business, said John. Over the holidays the next year, she opened the pop-up, again, and again it did a brisk business. “We found out the people of Cheybogan needed us,” said Marcella. It was time to make this Marcella permanent. In May 2017 they bought the building, opened up their boutique in the front and began construction on the wine pub in the rear. Marcella sells a wide range of jewelry, all designed by Marcella and all incorporating pearls. Prices range from $15 to $12,000. Other items include women’s evening jackets, dresses, purses and Scottish plaid vests. Last November, the Costins got a financial boost of $10,000 to help defray expenses for the wine pub when they won first prize in the first annual business-plan competition hosted by the Cheboygan Area Chamber of Commerce. Marcella beat out the other nine finalists by dressing like Queen Elizabeth and reciting her four-minute pitch in rhyming verse. She said she will pitch the Stormy Kromer business plan at the second annual pitch event this fall. They have other plans for the Marcella/wine pub building, where they currently employ 10. It has three apartments upstairs, which they are remodeling and will operate as what they call a couple’s weekend getaway. After they bought that building, they bought the three adjacent buildings, at 217, 219 and 221 N. Main Street, to the south of Marcella’s. They are building a small performance theater next door to Marcella’s and the wine pub; want to lease the next building out to a fudge shop, fudge being a tourist staple but without a store selling the stuff in Cheboygan; and are in discussions with potential tenants to open a salon in the third building that will style hair, do facials and offer body massages and Botox treatments. As if he wasn’t busy enough helping launch a series of new businesses, more than a year ago, John was recruited to be chairman of Cheboygan Main Street, a volunteer organization involved in the ongoing revitalization of downtown. “The Costins have come to town and just been phenomenal. They brought a can-do attitude,” said Scott Herceg, the executive director of the Cheboygan chamber. Tom Henderson: (231) 499-2817 Twitter: @TomHenderson2

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SPECIAL REPORT: NORTHEAST MICHIGAN

Brothers keep gluten-free food business in state By Tom Henderson

thenderson@crain.com

Shah and Haq Chaudary had a plan last fall: Buy a product line from a failing maker of gluten-free products in Hillman, a small village east of Alpena, and move production to Chicago, where they lived, or to Iowa City, Iowa, where in 2016 they bought their first gluten-free food company, Wholesome Treats Inc., which sells bread and muffin mixes under the Breads From Anna brand. Things didn’t work out as planned. The product line they bought when they launched Next Phase Enterprises Corp. last November was from a company called Mrs. Glee’s Gluten Free Foods LLC, which used navy beans to make pasta and flour for cookies, muffins, bread, pancakes and other baked goods. The company was founded in 2010 in a nonprofit in Hillman called the Food Incubator Center, which had been designed to foster startup food-related companies in northeast Michigan. But the incubator wasn’t sustainable and neither was Mrs. Glee’s. Its

Haq Chaudary: Chairman of Next Phase Enterprises

Shah Chaudary: President and CEO

Need to know

JJBrothers bought a product line from a failing maker of gluten-free products in Hillman JJLaunched Next Phase Enterprises Corp. last November JJPlanned to moved business to Chicago, but decided to stay in Michigan

lender took the business over and notified its seven employees on Sept. 30 that the plant was being shut down immediately. Meanwhile, Shah and his brother were in a meeting in Chicago with one of Breads From Anna’s suppliers. She told them about a supplier of hers in

a small town in Michigan that had gone out of business. There might be an opportunity to buy product lines, inventory and machinery, she said. (Subsequently, they bought that woman’s business, too.) Before buying Wholesome Treats and becoming its president and CEO, Shah had been director of procurement for Little Lady Foods Inc. of Elk Grove Village in Illinois, a contract maker of frozen specialty pizza for retail and food-service companies. Before that he was a management consultant in supply-chain management for Accenture, the worldwide consulting firm. “At Little Lady, I learned that gluten-free foods is a strong niche. There are a lot of people with celiac disease and the gluten-free segment is growing,” he said. So Shah was intrigued by the idea of growing through an affordable acquisition. “We were in that meeting with our supplier on a Wednesday. On Thursday my brother and I drove all night and got here early Friday morning,” said Shah. “We slept in the parking lot of the BP gas station for an hour

MORAN FROM PAGE 10

Moran has two large fabrication facilities in Onaway, another fabrication facility in Cheboygan and a 25-year lease on a 2,000-foot dock in a deep-water port in Rogers City called Port Calcite, named for the principal ingredient in limestone, which allows his largest projects to be hauled off by ship. A visitor driving east on M-68 from I-75 to the Moran Iron Works headquarters passes miles of corn fields interspersed with stretches of forest. There are few houses. Just west of Moran Iron Works is a sign proclaiming you are about to enter Tower, a centennial village founded in 1899. It is a ghost town. The Tower Tavern: Food and Spirits sits shuttered, surrounded by tall weeds, its parking lot barricaded; across the street is a former gas station, the tall glass Zephyr sign broken in half. “Groceries, beer, wine, liquor” says a sign on the building, which is vacant. Tower is followed by more cornfields and trees until, suddenly and incongruously, on the left loom two structures, four stories tall, with huge bay doors to allow big projects to be made inside and then trucked off to clients. In the meadow just east of the plants sits one of Moran’s gleaming artworks, a 12-foot metal sculpture of George Washington’s head, with long pony tail seemingly caught in the wind and blowing straight out behind him, his jaw set resolutely. It’s been sitting there for 20 years. Across the street from the plants, two horses graze in a field. Moran Iron Works designs, builds and installs just about anything made from metal, including ductwork, furnaces and pollution-control equipment for steel mills, power plants and cement plants; silos; large stairways; large boats and barges and even, currently, a small fishing boat for a Native American client. Fabricated components can be as tall as four stories, which are loaded onto massive flatbed

MORAN IRON WORKS INC

The Miss Margy, a ferry for the Shepler Ferry Co. in Mackinaw City that was launched in September 2015, is a 68-ton vessel with three 2,000-horsepower engines, took five months to build and cost $4 million.

trucks and hauled 20 miles to Port Calcite. In part to help train the highly skilled workforce his business requires, in 2004 Moran established a foundation to provide vocational education and training for local communities and school districts, with welding classes accredited through Alpena Community College. Eventually that evolved into the Industrial Arts Institute in Onaway. In 2012, Moran Iron Works was honored in Lansing by the Lowe Foundation as one of 50 Michigan companies to watch. It had 67 employees then. In 2013, the company was named business of the year by the Cheboygan and Onaway chambers of commerce, and Moran has served on the executive committee for the Michigan Economic Development Corp. and on the board of directors of McLaren Northern Michigan Hospital in Petoskey. A time-lapse sequence created by Moran shows two large recent projects as they went from start to finish on the shop floor. The first is Miss Margy, a ferry for the Shepler Ferry Co. in Mack-

inaw City that was launched in September 2015. It is a 68-ton vessel with three 2,000-horsepower engines, took five months to build and cost $4 million. The first new ship for Shepler since 1986, it was named for Margaret Shepler, the wife of company founder William Shepler, who died in 2004. The other was a 57-foot research vessel called the Stanford H. Smith that was built last fall for the U.S. Fish and Wildlife Service for $2 million. “When you do projects for the federal government, there are 15 bidders and thin margins, but it keeps your trained workforce working while you wait for higher-margin jobs,” said Moran. Currently Moran has crews working offsite on projects at the Alpine power plant in Gaylord and on a ship in Toledo.

A knack for art “I never went to art school. I never took a class. I didn’t know art, but I knew how to fabricate,” said Moran.

and got here for our 8 a.m. meeting.” They met with a representative of the lender, made an offer and closed on the acquisition of machinery and inventory in mid-November. The building had been leased by Mrs. Glee’s, and subsequently the Chaudarys bought two buildings totaling 12,000 square feet and the surrounding land, too. Shah is president and CEO of Next Phase, and Haq, who has been an executive in the food industry since 2000, including positions at San Leandro, Calif.-based La Brea Bakery; Rosemont, Ill.-based U.S. Foods Inc.; and Downers Grove, Ill.-based Sara Lee Corp., is chairman. Until recently, he was CEO of The Food Institute, a New Jersey-based provider of data and news to the food industry since 1918. The brothers migrated to the U.S. from Pakistan in 1992, joining their father, Abdul Hamid Chaudary, who had come to the U.S. several years earlier. They went to high school in Burbank, Ill., and attended universities in Chicago. “My brother and I are working 14 to 18 hours a day seven days a week

to achieve our dreams,” said Shah. “We come from a small village in Pakistan, and we understand what even a small business can mean for a small community,” said Haq. After the close of the purchase in mid-November, the Chaudarys met with former employees and offered them their jobs back. The brothers had decided they want folks to be employed over the holidays. They’d keep the production going into January or so. “The plan was to shut it down after the holidays. We thought we’d run the business for two or three months, then move the equipment back to Chicago,” said Shah. “I was relieved to get my job back,” said Barb Beegen, the plant manager. “There had been talk we were going to be shut down. There was talk every week, and then on Sept. 30, we got the word. We’re shut down. And then Shah and Haq showed up. I got a call in November to come in, we want to talk to you. And I came in and they offered me the job of plant manager. Now, we’re [growing] by leaps and bounds. I’ve had many jobs in my life, and this is my favorite.”

That’s an understatement. He has welded an astonishing range of art work, most of which he donates to nonprofit organizations, museums and to the city of Onaway for installation in its Awakon Park. “By the time I’m done with them, I’m sick of them. I need to get rid of them,” Moran joked. He discovered his flair for art in high school when a teacher brought him a Native American peace pipe that had been dropped and broken. Maybe he could do something with it, the teacher asked. Moran made a cast of the original pipe stem and used one of the metal shop’s pieces of equipment, a small foundry that could melt aluminum, to recreate it. He then painted it a terra cotta color and attached it to the unbroken bowl. His first piece was a success, and he had found something he excelled at. Now, there’s Washington’s head in the meadow; a 20-foot high interpretation of the Statue of Liberty along M-68 as you head into Onaway, made from welded steel that is painted to look like the green patina of copper; President Gerald Ford’s head in downtown Onaway; a 40-foot-long pickax at the Cheboygan County Fairgrounds; a 14-foot-high head of Abraham Lincoln that watches over the baseball field at the United Auto Workers retreat in Black Lake; and Liberty’s torch on the waterfront in Rogers City. Anyone who has driven across the Upper Peninsula, heading west from Marquette, has marveled at two massive creations at the Yooper Tourist Trap near L’Anse, a whimsical place to pull off and charge batteries before continuing on. One is a 50-foot muzzle loader that actually works, shooting 550-caliber shots of compressed confetti. “It’s deafening,” said Moran. It’s been the star of small-town parades, firing confetti at those along the route. “We’ll get people knee deep in confetti.” The other piece is a giant chainsaw, too big even for Paul Bunyan, its blade powered by a Ford V-8 engine.

Other art works include winged dragons; a gorgeous monarch butterfly alighting on a flower; Atlas kneeling, the earth on his shoulders; a sleek sturgeon that honors Onaway’s motto as the sturgeon capital of Michigan; and a black steam locomotive so realistic you expect to see steam pouring from its chimney. Moran says he isn’t an artist but a craftsman. Nonetheless, he indulges his love for art by traveling the world to visit its museums, from Paris to Beijing. In 2006, he was honored as patron of the year by the Crooked Tree Arts Center in Petoskey. And in 2014 he was the featured artist at Crooked Tree’s annual fundraiser, D’Art for Art, an honor that required him to create a sculpture to be auctioned off. What he created was a piece titled Sum of Us, an orb 40 inches in diameter made from thousands of pieces of metal, including an antique French tea pot, hand guns, nuts and bolts. The art work fetched $20,000 from a bidder who lived in Dallas, breaking the fundraiser’s record by almost double. “Tom is simply one of the most interesting people I’ve ever known,” said Casey Cowell, the founder of Boomerang Catapult LLC, a funder of startup tech companies in Traverse City. Cowell founded U.S. Robotics Inc. in 1976 when he was 23 and grew it into the world’s dominant maker of computer modems. “He is obviously extremely talented and creative. He can make anything, sometimes planned out in excruciating detail, sometimes it just comes to him and is revealed as he works,” said Cowell. “It’s simply amazing to me. He’s a thinker and an experiencer. I guess the part of Tom I like the most and have the most respect for is that he is fully engaged in life and he is a lifelong committed learner.” An classmate from long ago might have said: “Tom Moran? A life-long committed learner?” Mr. Lewis might have said: “Sure, why not?”

SEE BROTHERS, PAGE 14

Tom Henderson: (231) 499-2817 Twitter: @TomHenderson2

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CHEBOYGAN FROM PAGE 10

wine pub behind Simply Marcella. They’re getting ready to open up a Stormy Kromer’s retail store, a three-apartment couple’s getaway rental business, a performance theater, a fudge shop and a salon and spa. The Langes opened up the Nauti Inn, a marine-themed bar and restaurant that features live jazz, in July 2017 and have bought two other buildings, one with a gift shop on the ground floor and an apartment upstairs, the other being rehabbed. The Langes are also looking at other properties and plan to open a second restaurant within a year. “In cities that are on the upswing, like Cheboygan, there are still great deals available,” Sharen said. “There were 16 vacant downtown buildings for sale just two years ago, and at prices that were remarkably affordable.” “When I started to take a look at Cheboygan, the thing that jumped out at me was this was a community with a ton of potential,” said Herceg. Herceg said the attitude around town has changed dramatically since he arrived in May 2016. “When I got here, the status quo had been very pessimistic,” he said. He said a magazine profile then had included two longtime business owners in Cheboygan who were about to close, Scott Herceg: and their take on Cheboygan has a life in the small ton of potential. city was depressing, he said. At the time, the Michigan Economic Development Corp. offered small cities a blueprint for improvement it called Michigan Main Street. City and chamber officials were interested and launched some initiatives. “It lit the fire. There was a lot of dried brush, and it just needed a flame,” said Herceg. One initiative was branded as Bring It Cheboygan, and it has gone from a handful of members to about 400, including the Langes and the Costins. “They started with simple things, like washing the windows on empty buildings downtown. They started setting up displays in empty storefronts. They walked the length of Main Street and picked every weed from every crack,” he said. Soon after Bring It launched, Michigan State University held an environmental boot camp in Sault Ste. Marie, and on the way back, Herceg and the three others in his car began talking about whether a “Shark Tank”-type pitch contest for would-be startups would work in Cheboygan. The result was the first annual Invest Cheboygan event last November at the historic opera house in town. Organizers raised a first-place prize of $10,000 and in-kind services from sponsors; 16 interested entrepreneurs applied. “People said, ‘Oh, it’s fine to have a contest, but nobody is going to attend. Three hundred and fifty showed up. It was phenomenal,’” said Herceg. Marcella Costin took first for her pitch for The Queen’s Head, appearing as Queen Elizabeth and delivering her four-minute pitch in rhyming verse. The second annual Invest Cheboygan will be held on Nov. 1 at the Opera House, with the prize increased to $15,000 in cash and $6,000 in in-kind services. For information or to apply, go to northernlakes.net/upcoming-events.

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BROTHERS FROM PAGE 12

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By the time January rolled around, the move to Chicago was in doubt. “Our employees are just really good people. I don’t have the words for it,” said Shah. “My brother and I were used to the big city and how people treat you there. My brother and I said to each other, ‘Did you notice how nice everyone is?’” And it wasn’t just employees happy to keep their jobs. Local officials and business leaders greeted the brothers warmly. “The town elders were very helpful. The town was just excellent,” said Shah. One of those elders was Dave Post, the village manager for more than 20 years. “Dave was extraordinarily helpful,” said Shah. Post said his village and the region were particularly hard hit by the Great Recession, with businesses closing and young people leaving for other areas. “And we have been hurt by big-box stores. They sucked the life out of small towns.” A new business owner coming to town, getting a closed operation back on the tax rolls and saving a handful of jobs has been a big deal for the village, he said. Like other small towns, Hillman has seen a recent revitalization. Post oversaw a streetscape improvement program, the downtown park got a makeover and high-speed internet is available throughout the village and even in a campsite adjacent to the park. “When Shah and Haq came here, we got their water and sewer hooked up right away. We were talking back and forth, and they saw we are welcoming people. They saw they might have a better opportunity here, that we were a place where people wanted them. We’re looking forward to watching them grow,” said Post. Jack Matthias owns the Thunder Bay Resort, an 18-hole public golf course, restaurant and lodging operation in Hillman. A school-board member and community activist, he and Post helped Next Phase network with local and state officials. So far, the Chaudarys have had preliminary discussions with the Michigan Economic Development Corp. about possible funding assistance to move Breads From Anna operations to Hillman from Chicago, and have begun talks with officials at Alpena Community College about setting up a training program in Hillman as Next Phase ramps up production and employment. “I am guardedly optimistic about their plans to make Hillman a center for gluten-free food production,” said Matthias, who has a daughter with celiac disease. “Montmorency County is one of the least populated counties in the state. It’s a great place to live, but it’s hard to find a good job. Shah and Haq are smart, they’re well capitalized and they are well connected. The have shelf space at big retailers, which is important. Mrs. Glee’s couldn’t get that shelf space, which is why it went out of business.” Montmorency had a population of just 9,756 in the 2010 census. Of the seven smaller counties in the state, only one, Oscoda, is in the Lower Peninsula. “People here won my heart. I could not take this company away from this town,” said Shah. In August, he moved his family and three young children, ages 7, 4 and eight months to the Village of Hillman, which had a population of 701 at the last census. “That’s my commitment

to this place. The goal, now, is to make Hillman known as a mecca for gluten-free products. Our plans are big.” Haq remains in Illinois. Currently, Next Phase’s customers include Breads From Anna, the Legit Bread Co. of Arlington, Va., and Al Dente Pasta Co. in Ann Arbor, all makers of gluten-free products. Shah said Breads From Anna will have revenue of more than $1 million this year and Next Phase will have revenue of about $500,000. Next Phase has bought some baking machinery that sits in crates on the factory floor, with the plan to launch a line of baked goods next year, including a variety of fruit breads, muffins and cookies to be sold under the Breads from Anna brand, which is sold in Meijer and Whole Foods stores. “That will grow our revenue exponentially,” he said. Next Phase is also about to launch its own pastas made from navy beans under the Incredibean brand. “We want to promote Michigan navy beans,” he said. Thus far, the brothers have funded growth out of revenue, “but the time will come when we will need outside funding for growth,” said Shah, who has begun talks with Marquette-based Northern Initiatives, a nonprofit that is a lender to small Michigan companies.

“I am intrigued with their vision for making Hillman the gluten-free manufacturing capital of the Midwest and perhaps the U.S. If they can use locally produced beans and ag commodities from that part of the state, it becomes an even bigger deal.” Chris Wendel

“We are not lenders or investors with Shah and Haq, yet. We’ve expressed an interest but they have yet to decide to utilize our funding,” said Chris Wendel, a business coach with Northern initiatives who has vetted Next Phase. “I am intrigued with their vision for making Hillman the gluten-free manufacturing capital of the Midwest and perhaps the U.S. If they can use locally produced beans and ag commodities from that part of the state, it becomes an even bigger deal. Their ability to purchase other gluten-free companies shows that they have some financial strength,” he said. Shah said the brothers are currently negotiating to buy two more small gluten-free food companies and consolidate at least some of their operations to Hillman. “Our five-year plan is quite ambitious. We want to have a 50,000- to 100,000-square-foot facility with 200 to 300 or more employees,” said Shah. “We plan to become a onestop-shop for the gluten-free category. This will require a significant amount of capital investment to achieve.” Tom Henderson: (231) 499-2817 Twitter: @TomHenderson2

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CRAIN'S LIST: INTELLECTUAL PROPERTY LAW FIRMS

Ranked by number of IP lawyers Rank

Firm Address Phone; website

Top local executive(s)

Local intellectual property lawyers June 2018/ 2017

Total number of local lawyers June 2018/ 2017 Practice areas

Brooks Kushman PC 1000 Town Center, 22nd Floor, Southfield 48075 (248) 358-4400; www.BrooksKushman.com

Mark Cantor president

78 79

Patent prosecution, trademarks, intellectual property litigation, post-grant proceedings, open source compliance, IP due diligence, trade secrets, licensing, copyrights, legal IT consulting, compliance and technical design consulting

Harness, Dickey & Pierce PLC 5445 Corporate Drive, Suite 200, Troy 48098 (248) 641-1600; www.hdp.com

Executive committee

61 61

Patents, trademarks, copyrights, litigation, transactions/due diligence, anticounterfeiting, foreign rights, appellate litigation

Dickinson Wright PLLC 500 Woodward Ave., Suite 4000, Detroit 48226 (313) 223-3500; www.dickinsonwright.com

William Burgess CEO

36 42

171 174

Intellectual property, business technology, copyrights, patents, trademarks, intellectual property and trade secrets litigation

Honigman Miller Schwartz and Cohn LLP 2290 First National Building, 660 Woodward Ave., Detroit 48226-3506 (313) 465-7000; www.honigman.com

David Foltyn chairman and CEO

36 34

225 219

Trademark and copyright, patent and intellectual property litigation practice groups

Howard & Howard Attorneys PLLC 450 W. Fourth St., Royal Oak 48067 (248) 645-1483; www.howardandhoward.com

Mark Davis president and CEO

32 32

80 74

IP litigation; patents; trademarks; copyrights; licensing of IP rights; EDI; technology acquisition or sale; technology law audit; advertising; gaming

Young Basile Hanlon & MacFarlane PC 3001 W. Big Beaver Road, Suite 624, Troy 48084 (248) 649-3333; www.youngbasile.com

Andrew Basile Jr. president

28 26

28 28

Patent and trademark litigation, prosecution and counseling; technology-related transactions, including licensing, acquisitions and divestitures; representation of emerging growth companies; and commercial and employment litigation

Carlson, Gaskey & Olds PC 400 W. Maple Road, Suite 350, Birmingham 48009 (248) 988-8360; www.cgolaw.com

Theodore Olds III president and CEO

24 22

Patents, trademarks, copyrights and trade secrets worldwide; intellectual property and commercial litigation

Reising Ethington PC 755 W. Big Beaver Road, Suite 1850, Troy 48084 (248) 689-3500; www.reising.com

William Francis chairperson and president

23 21

Patents, trademarks, copyrights, trade secrets, counseling, opinions, portfolio management, litigation

Price Heneveld LLP 695 Kenmoor, S.E., Grand Rapids 49546 (616) 949-9610; www.priceheneveld.com

Brian Cheslek managing partner

19 20

18 0

Patents, trademarks, litigation, copyrights, trade secrets and non-compete covenants, information technology and cyber law, antitrust, entertainment law, licensing agreements, interference, international law

Quinn IP Law (Quinn Law Group PLLC) 21500 Haggerty Road, Suite 300, Northville 48167 (248) 380-9300; www.quinniplaw.com

Christopher Quinn president and CEO

19 18

Patent, trademark, copyright and trade secret procurement and enforcement; licensing, IP due diligence; technology-related agreements and transactions; IP asset and portfolio management; strategic consulting

Bodman PLC Sixth Floor at Ford Field, 1901 St. Antoine St., Detroit 48226 (313) 259-7777; www.bodmanlaw.com

Ralph McDowell chairman

18 18

122 134

Technology transfer, IP litigation, digital publishing, trademark selection, registration and licensing, economic espionage, entertainment, IP brand protection

Miller, Canfield, Paddock and Stone PLC 150 W. Jefferson Ave., Suite 2500, Detroit 48226-4415 (313) 963-6420; www.millercanfield.com

Michael McGee CEO

18 17

137 136

Patents, trademark, copyright and trade secret prosecution, counseling and litigation

Fishman Stewart PLLC 39533 Woodward Ave., Suite 140, Bloomfield Hills 48034 (248) 594-0600; www.fishstewip.com

Michael Stewart and Michael Fishman founding partners

17 14

Trademark, copyright, patent, patent prosecution, trade secrets, social media, due diligence, litigation and dispute resolution, IP consulting, transactional and ecommerce services

Warner Norcross + Judd LLP 2000 Town Center, Suite 2700, Southfield 48075-1318 (248) 784-5000; www.wnj.com

Linda Paullin-Hebden executive partner

14 12

38 39

Copyright law, intellectual property, IP enforcement and litigation, patent prosecution and portfolio management, technology and IP licensing, purchase and sale, trademark portfolio and brand management

Brinks Gilson & Lione 524 S. Main St., Suite 200, Ann Arbor 48104-2921 (734) 302-6000; www.brinksgilson.com

Steven Oberholtzer managing partner Ann Arbor office

13 15

Patent prosecution, intellectual asset management, trademark litigation, green tech licensing, biotech/pharma, nanotechnology

Dinsmore & Shohl LLP 900 Wilshire Drive, Suite 300, Troy 48084 (248) 647-6000; www.dinsmore.com

Mark Schneider office managing partner

13 9

14 12

Patent, trademark and copyrights

Butzel Long PC 150 W. Jefferson Ave., Suite 100, Detroit 48226 (313) 225-7000; www.butzel.com

Justin Klimko president and managing shareholder

13 6

128 126

Darrow Mustafa PC 410 N. Center St., Suite 200, Northville 48167 (248) 864-5959; www.darrowmustafa.com

Christopher Darrow president

12 11

Procurement and litigation of intellectual property rights

Bejin Bieneman PLC 2000 Town Center, Suite 800, Southfield 48075 (313) 528-4882; b2iplaw.com

Charles Bieneman partner Daniel Hegner, Stephen Kontos, Christopher Francis, Thomas Bejin members Eric Dobrusin president and shareholder

11 13

Patent prosecution, IP litigation, trademarks, licensing, due diligence

10 11

Patent practice, trademark practice, IP strategy and counseling, patent opinions, IP due diligence, technology transfer, government contracts, customs enforcement

19 20

The Dobrusin Law Firm PC 29 W. Lawrence St., Pontiac 48342-2813 (248) 292-2920; www.patentco.com

Cantor Colburn LLP 201 W. Big Beaver Road, Suite 1101, Troy 48084 (248) 524-2300; www.cantorcolburn.com

Scott McBain managing partner, Troy office

8 8

Litigation, patents, trademarks, copyrights, licensing, opinions, IPRs

Garan Lucow Miller PC 1155 Brewery Park Blvd., Suite 200, Detroit 48207 (313) 446-1530; www.garanlucow.com

John Gillooly chairman of the executive committee

7 7

56 63

Insurance defense and coverage analysis, appellate law, commercial banking and real estate, commercial transportation and logistics, ERISA and employee benefits law, municipal law, intellectual property, no-fault and auto negligence and workers' compensation

This list is an approximate compilation of intellectual property firms in Wayne, Oakland, Macomb, Washtenaw and Livingston counties. It is not a complete listing but the most comprehensive available. Unless otherwise noted, information was provided by the firms. Firms with headquarters elsewhere are listed with the address and top executive of their main Detroit-area office. NA = not available. LIST RESEARCHED BY SONYA D. HILL

C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 1 7 , 2 0 1 8

PEOPLE BANKING/FINANCE J David Hale to director, Angle Advisors LLC, Birmingham, from vice president, finance, Tribar Manufacturing LLC, Howell.

LAW Krista Haroutunian to judge, 17th District Court, Redford Township, from shareholder, Haroutunian Licata Haroutunian PC, Bingham Farms. Haroutunian was appointed to the position by Gov. Rick Snyder, filling

SPOTLIGHT the vacancy created by the resignation of Judge Charlotte Wirth. She must seek election in November 2020 for a full term. J Patrick Belville to partner, M&A Practice, Jones Day, Detroit, from vice president and associate general counsel, Mergers & Acquisitions, Cardinal Health Inc., Dublin, Ohio.

EDUCATION J Fran Brown to president, Michigan School of Professional Psychology, Farmington Hills, from program director.

MANUFACTURING

TELECOMMUNICATIONS

J Michael McHale to director, communications, Rivian Automotive LLC, Plymouth, from director, corporate communications, Subaru of America, Camden, N.J.

J Vilas Uchil to vice president of technology and engineering, BullsEye Telecom Inc., Southfield, from director of network engineering.

NONPROFITS

TRANSPORTATION

J Lisa Chapman to director of strategic initiatives, Community Housing Network, Troy, from Michigan director, Corporation for Supportive Housing, Detroit.

J David Tisdale to transportation operations manager, Evans Distribution Systems Inc., Melvindale, from transport manager, Glovis America Inc., Belleville.

chairman and CEO, Tag Holdings LLC; Alina Morse, founder, Zollipops; Rochelle Riley, author and columnist, Detroit Free Press and Dawn Verbrigghe, digital marketer and Riley founder, Jottful. Lawrence Technological University. $97. Contact: ZaLonya Allen, email: supportstaff@ nationalentrepreneurs.org; website: nationalentrepreneurs.org

Oct. 10. Detroit Regional Chamber. Event includes automotive industry leaders, students and interns from regional universities, colleges and trade schools. The Beacon at One Woodward. $75 members, $125 nonmembers. Contact: Jordan Yagiela, phone: (313) 596-0384; email: jyagiela@detroitchamber. com

CALENDAR TUESDAY, SEPT. 18 The Impact of Additive Manufacturing On Small Manufacturers. 8 a.m.-noon Lawrence Technological University. Session will include case studies that share how companies are applying new generation tools to improve the delivery of durable goods. The event includes exhibits featuring regional additive manufacturing service firms, a live additive manufacturing casting demonstration as well as a tour of Lawrence Technological University’s Additive Manufacturing Lab. LTU Buell Building. Free with online registration. Email: mbrucki@ltu.edu; website: ltucollaborator y.com/events/ techtuesday-additive-manufacturing/

WEDNESDAY, SEPT. 19 Top of Troy: Women of Influence. 8-9:30 a.m. Troy Chamber of Commerce. Panel members discuss the challenges they faced on their paths to success, the key tools they have used to remain focused along the way, the hard decisions they are faced with on a daily basis and how being a woman has affected the choices they made. Panel includes: Mary Mbiya, vice president, diversity and inclusion program manager, Flagstar Bank; Kelly Finley, owner and broker, New Century Realtors; Joan Haakonstad, owner, Intelligent

Office; Julia Kellogg, chief people officer, North American Bancard Holdings LLC. Beaumont Hospital Troy. $20 members, $30 nonmembers. Contact: tracie@troychamber.com

UPCOMING EVENTS Attracting and Retaining Top Talent Lunch. 11 a.m. to 1 p.m. Sept. 27. Detroit Regional Chamber. Regional business leaders discuss strategies for attracting the nation’s top talent, while also retaining and growing Southeast Michigan’s current talent pool. Speakers include: Marcus Collins, chief consumer connections officer, Doner; Lisa McLaughlin, CEO and co-founder, Workit Health; Dan Ngoyi, director, talent acquisition, Quicken Loans Family of Companies. $30 members, $50 nonmembers. Greektown Casino-Hotel. Contact: Andrea Rayburn, phone: (313) 5960340; email: arayburn@detroitchamber.com Entrepreneur and Small Business Conference: Small Business Doing Big Business. 9 a.m.-4 p.m. Oct. 3. National Entrepreneurs Association. Event will focus on specific strategies entrepreneurs can implement to scale and generate larger profit margins. Topics include working with corporations, government contracting, joint ventures, funding large projects and digital marketing. Speakers include Joe Anderson,

Reintroducing Wayne State University: Transformation After 150 Years in the Heart of Detroit. 11:30 a.m.1:30 p.m. Oct. 9. Detroit Economic Club. Wayne State University President Dr. M. Roy Wilson will share his perspectives on the importance of Wilson universities and on the transformation of Wayne State. Westin Book Cadillac. $45 members, $55 guests of members. Website: econclub.org 2018 MICHauto Summit. 9:30 a.m.

Education 2.0: Engaging in the Race to Create a Future Workforce. 8-9:30 a.m. Oct. 17. Troy Chamber of Commerce. The future of higher education is in flux as colleges and universities take steps to create the next workforce. Speakers include: Marsha Kelliher, president and CEO, Walsh College; Ora Hirsch Pescovitz, president, Oakland University; and Peter Provenzano Jr., chancellor, Oakland Community College. MSU Management Education Center, Troy. $22 Troy Chamber members, $32 nonmembers. Contact: theteam@troychamber.com. Website: troychamber.com/events/ education-2-0-engaging-race-create-future-workforce/ Robots Won’t Take Your Job, But They Will Change It. 11:30 a.m.-1:30 p.m. Oct. 23. Detroit Economic Club. Ranjit de Sousa, president, Lee Hecht Harrison, will talk about changes and trends. Westin Book Cadillac. $45 members, $55 guests of members. Website: econclub.org

DEALS & DETAILS EXPANSIONS J Virginia Tile Company LLC, Livonia, a tile and natural stone distributor, has opened a larger showroom in Warrensville Heights, Ohio. The previous showroom was 4,500 square feet and the new location is 9,000 square feet. Website: VirginiaTile. com J Fred Astaire Dance Studio Michigan, Bloomfield Hills, a dance studio, has opened a second location at 5526 Drake Road, West Bloomfield Township. The new location has two dance floor ballrooms and occupies 3,400 square feet. Website: fredastaire. com/bloomfield-hills J FCA US LLC, Auburn Hills, an automaker, has opened the HW Hunter Ram of The West Truck Center, a 40,000-square-foot Ram facility, on seven acres in Lancaster, Calif., at a

cost more than $10 million. It employs 70 people. Website: fcanorthamerica.com

MOVES J JRED Engineering Inc., Dearborn Heights, consulting engineers in the construction industry, has moved to the Livonia Metro-Plex Office Park, 14137 Farmington Road, Livonia. Phone: (734) 855-4904.

NEW PRODUCTS J Ann Arbor-based software company Pixel Velocity’s Event Velocity software will be included in Round Rock, Texas-based technology company Dell Technologies’ IoT Connected Bundles program for industrial operating companies. Event Velocity incorporates data from multiple loca-

Adient hires DelGrosso as CEO

Adient plc is hiring Douglas DelGrosso, the top executive at Southfield-based Chassix, as its president and CEO, replacing Frederick “Fritz” Henderson in the role. DelGrosso, 56, takes over the top executive role at the DelGrosso P l y m outh-based automotive seating supplier effective Oct. 1. He’s currently president and CEO at Chassix. Chassix’s CFO Michael Beyer will serve as interim CEO while the company searches for DelGrosso’s replacement. DelGrosso has experience fixing sinking auto suppliers. He joined Chassix in 2016 to help the supplier emerge from bankruptcy and has since led a turnaround.

Goodwill taps former Detroit CEO

Goodwill Industries International has tapped Lorna Utley, retired CEO of its Detroit affiliate, to serve as its interim CEO. In August, Utley succeeded former president and CEO Jim Gibbons, who sigUtley naled his intent to leave the Maryland-based nonprofit in April to pursue new opportunities in social impact investment and entrepreneurism. Utley said she will hold the role while a search continues for a permanent successor, likely until early 2019. Goodwill Industries International is the membership organization that serves the 161 Goodwills in the U.S., Canada and some international affiliates. It’s supported by membership dues and pass-through federal funds, making it “quite a bit different from running a revenue-generating nonprofit like (in) Detroit,” Utley said.

Ascension Michigan's interim CEO takes permanent job

tions from video cameras, infrared cameras, microphones, microwave sensors and industrial equipment into a single virtual operator. Websites: pixel-velocity.com, delltechnologies.com J Federal-Mogul Powertrain, a division of Federal-Mogul LLC, Southfield, an automotive supplier, is launching IROX 2, a high performance polymeric coating for heavy-duty applications. Website: federalmogul.com J RedViking Group LLC, Plymouth Township, a manufacturing engineering company, has added a battery power source solution to its automatic guided vehicle offerings. Website: redviking.com J Spinner Grow, Waterford Township, a gardening technology company, has introduced the SpinnerXP modular plant growth chamber for

personal and commercial use for growing plants indoors. Website: spinnergrow.com J BorgWarner Inc., Auburn Hills, an automotive supplier, has developed a dual volute turbocharger for gasoline engines in light-duty vehicles to allow quicker engine response time when accelerating from low speeds. Website: borgwarner.com

STARTUPS J Canopy Wealth Management, an investment adviser, has opened for business with offices in Southfield and Middleton, Wis. The Southfield office is at 25200 Telegraph Road, Suite 425. Phone: (248) 663-7505. Website: canopy-wealth.com

Submit Deals & Details items to cdbdepartments@crain.com

Ascension Health Michigan’s interim CEO has officially taken the 15-hospital regional system’s top title. Joseph Cacchione, M.D., began serving in April after former top executive Gwen MacKenzie resigned around Cacchione a month after publicly announced layoffs of 500 employees. Cacchione will also continue to lead Ascension Medical Group, the national provider organization of Ascension, as CEO, according to a news release. He was named to his previous title at the medical group, president, in March 2017.

September 17, 2018

C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 1 7 , 2 0 1 8 CRAIN’S DETROIT BUSINESS

17 Page 1

CHARTS BY LISA SAWYER/CRAIN’S DETROIT BUSINESS

DECADE FROM PAGE 1

And it’s not always evident in the data. Michigan’s GDP per capita actually eclipsed the 2005 peak in 2016 by a tenth of a percent. Michigan is, in fact, wealthier. But most of its residents are not, and GDP per capita growth is still stagnant when compared with other states. Michigan’s income inequality gap has widened, as it has nationally, since the Great Recession — ranking as the 11th worst income gap in the nation, according to a 2016 study issued by the Michigan League for Public Policy. Median household income for the state adjusted for inflation is down more than 15 percent — $57,700 in 2017 — from its peak in 1999 and remains down 3 percent from its preGreat Recession peak in 2006. Homeownership also hasn’t recovered, with fewer young people buying homes and many of those who lost homes not recovering enough to buy again. There are more renters in the U.S. than in any period since 1965, according to a report last year by the Pew Research Center. The ownership rate was down nearly 6 percent last year at 72.9 percent, down from the peak of 77.4 percent in 2006. Charles Ballard, an economist at Michigan State University, said the recovery has largely been reserved for the wealthy and upper-middle classes. “This is a continuation of the disequalization of the last 40 years,

In 2000, Michigan ranked eighth highest in per-pupil K-12 spending, but slipped to 24th by 2016. In inflation-adjusted numbers, Michigan’s per-pupil spending fell by $663, while the U.S. average increased by more than $1,400 per student. Michigan ranks 46th in the U.S. for fourth-grade reading proficiency — a metric that continues to trend down — 42nd in career and technical education and 47th in out-of-state college enrollment, according a 2017 Business Leaders for Michigan report. And with an inevitable recession looming, there’s no indication the future for Michigan’s residents will be which has been called the ‘Great Divergence,’” he said. “The folks at the very top have pulled away from the folks near the top, and those near the top have pulled away from those in the middle, although the middle hasn’t pulled away from the bottom.” Employment remains the reason. While the unemployment rate for the state plummeted to 4.8 percent in July this year from 15.4 percent in July 2009, there are fewer people actually working. The unemployment rate only captures the part of the labor force that is either working or seeking work. The number of people of working age, 18 years old to 64 years old, who have left work altogether is also growing.

“The folks at the very top have pulled away from the folks near the top, and those near the top have pulled away from those in the middle, although the middle hasn’t pulled away from the bottom.” Charles Ballard

Michigan’s labor force participation rate dropped to 61.5 percent in July this year from a peak of 69 percent at the beginning of 2001. The labor force has only recovered by 1.5 percent since its low point of 60 percent in 2012, despite having nearly 100,000 fewer residents and 250,000 fewer jobs than before the recession. Meanwhile, more than 64,000 unfilled jobs are posted on the state of Michigan’s talent recruitment site. But hurdles remain for the state’s lower classes, such as failing schools in Detroit and other communities. Michigan ranks 40th in the nation in high school graduation rate, with only 79.7 percent of students receiving a diploma. And roughly 13 percent of Michigan’s youth between 18 years and 24 years old are neither in college or seeking employment, which will further perpetuate adult poverty.

any better than before Lehman Brothers collapsed. “If times are hard, you can’t put off buying groceries, but you can put off buying a car,” Ballard said. “Thus any recession is likely to be unusually difficult for a state, like Michigan, that concentrates in the production of durable goods. Because of the longterm shrinkage of the manufacturing sector, Michigan isn’t as heavily dependent on manufacturing as we used to be, but we still depend on manufacturing more than the average state.” Dustin Walsh: (313) 446-6042 Twitter: @dustinpwalsh

JOB FRONT POSITIONS AVAILABLE HARMAN CONNECTED SERVICES - SENIOR TEST ENGINEER, 1 POSITION Perform Multimedia, BT/Wi-Fi & connect (Carplay/Android Auto) testing, Feature spec, Integrated, Part/Full Regre, Automated tests. In-vehicle test/troubleshoot, Bench test/ troubleshoot, Carplay & Andr Auto Self Certi Test, Repro Defec veri fix/resol issues, supp Devs, Iden Test scen based func & busn req & crea & m’tain test case Supp cust test driv Crea test rep error with supp trace, log files & excel descr. Ensu test res are docu & comm appro & defe ente in defect mgmt tool. I’face with cust as need to reprod an issue found in v ehi/sys. Need Bachelor’s deg (or foreign Equi) in ComSci, Eng, InfoTech, Electro/Electri Eng or rel & 5 Yrs overall progr exp IT indus of which 3-5 yrs exp into Automotive Infot Test accep. Alt: Master’s deg (or foreign Equ) in ComSci, Eng, InfoTech, Electro/Electri Eng or rel & 3-4 Yrs overall prog exp in IT indus of which 3 yrs exp into Automotive Infot Test is accep. Work k’ledge of func & non-func SW test, SW test life cyc & vari test des method (func, perfo, stress, accep, smoke etc.). Creat test plans, test case dev Req anal Exp with auto test tools & FW, test auto. Exp with defect mgmt tool, log tool, MS Office, QNX, Android, WiFi, BT. Apply: Pls send CV’s to Harman Connected Services, Attn: Mahesh GM/Job Code STE-M09, to 2002 156th Avenue NE #200, Bellevue, WA 98007. Work Loc: Novi, MI may have long term assign in other loc in U.S. incl Livonia, MI areas.

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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 // S E P T E M B E R 1 7 , 2 0 1 8

DETROIT HOMECOMING

StockX investment, Ford among Homecoming highlights The fifth annual Detroit Homecoming gathering of Detroit expats took place last week. Here are some of the news highlights from the threeday event:

StockX raises $44 million from new investors with boost from Silicon Valley

Detroit-based e-commerce startup StockX has raised $44 million from investors as the exchange that bills itself as a “stock market of things” got a boost from Silicon Valley funders at the venture capital arm of Google's parent company Alphabet Inc. The new round of venture capital for the rapidly growing company is a seven-fold increase from the $6 million StockX raised in its February 2017 funding round that attracted high-profile investors including rapper Eminem and actor Mark Wahlberg. StockX CEO Josh Luber and his co-founder, Detroit billionaire businessman Dan Gilbert, announced the results of the Series B funding round Wednesday night during the opening dinner of Detroit Homecoming event at Little Caesars Arena. The new investment round was co-led by Silicon Valley venture capital firms GV (formerly Google Ventures) and Battery Ventures and attracted more high-profile investors to the rapidly growing company. "It's the first and the largest venture capital investment Silicon Valley" has made in a Detroit company, said Gilbert, the founder and chairman of Quicken Loans Inc. and its family of companies. StockX has said it has been doing more than $2 million in daily sales of sneakers, watches, bags and luxury streetwear. Luber said Wednesday that the company is "closing in on a billion-dollar run rate" in sales on the exchange for the calendar year. The company makes money by taking a commission of 8 percent to 9.5 percent on each sale plus a 3 percent processing fee. "This is how you go from a $1 billion company to $10 (billion) or $20 (billion) or $50 billion company — because that's the goal at this point," Luber said. StockX is an e-commerce website that serves as a secondary market for buying and selling and authenticating highly collectible sneakers and other items after they sell out in stores. The new funding will help the company expand into international markets and original retail sales of high-end merchandise, Luber said. Since launching in February 2016, the company has been experiencing what Luber calls "a state of hypergrowth of hiring" as its workforce swelled from 150 employees this winter to 400 this month. The company expects to hire 300 more employees for customer service, information technology and its authentication centers in Detroit and Tempe, Ariz., by year’s end. “Honestly, it’s as fast as we can find people,” Luber said in an interview with Crain’s. “We could easily use 1,000 people tomorrow, if we can find them.”

PHOTOS BY LARRY PEPLIN FOR CRAIN’S

StockX CEO Josh Luber makes a presentation on the e-commerce website that serves as a secondary market for buying and selling and authenticating highly collectible sneakers and other items after they sell out in stores.

Kresge puts $50 million behind Marygrove ‘cradle-to-college’ center

The Troy-based Kresge Foundation has committed $50 million to the "cradle-to-college" center planned for the Marygrove College campus in Detroit. The grant to the project, which also will expand the University of Michigan's presence in Detroit, is the largest philanthropic commitment made by a foundation to any Detroit neighborhood. It will fund an effort two years in the making, including an early childhood education center led by Starfish Family Services set to open in fall 2020 and a UM-led residency teaching school modeled after a doctor residency program. UM President Mark Schlissel said the resident teaching school is believed to be the first of its kind in the country. The preschool-through-college program, also known as “P-20,” is expected to serve more than 1,000 students, Kresge CEO Rip Rapson said Thursday. Rapson first revealed details of Kresge's involvement on a Homecoming panel that preceded the partners' press conference Thursday. It's happening with a long list of collaborating organizations, including the UM School of Education, Detroit Public Schools Community District, the Marygrove Conservancy and Marygrove College, Starfish, IFF and the Detroit Collaborative Design Center of the University of Detroit Mercy. Kresge led development of the campus plan after stepping in with $16 million to support Marygrove over two years, saving the campus from going dark and ownership shifting to creditors after it accumulated $10 million to $15 million in obligations owed to Comerica, Wayne County and the U.S. Department of Education.

Ford: Corktown plan aims to ‘curate’ mobility’s future

Ford Motor Co. is aiming to “curate” the future of mobility for major cities with its $740 million investment in the city of Detroit. Executive Chairman Bill Ford Jr., speaking at Detroit Homecoming’s

opening night at Little Caesars Arena, said its acquisition of the sweeping 1.2 million-square-foot area surrounding and including the vacant Michigan Central Station will be the home of an entire mobility ecosystem. “If you look at the total addressable market (of mobility), it’s huge,” Ford said. “It’s not only (automakers) and suppliers, but Uber and Lyft, and scooters and bikes. It’s not just ways of moving people, but ways of moving goods, drones, etc. Somebody has to make sense of this all. This needs to be thoughtful. We want to help curate all this. This makes sense for us. This is a need that’s unfilled.” The investment, which is spread across five buildings, will sway heavily toward including startups and entrepreneurs in the space, Ford Jr. said on stage with Detroit Mayor Mike Duggan and Crain Communications Inc. President KC Crain. “We’re going to experiment with all kinds of stuff,” Ford said. “Look at scooters. We’re finding ... it solves a lot of the last mile. Who would have thought a year ago that all these things are going to evolve and develop? Cities are all asking for solutions. They are all overcrowded with traffic. A lot of cities around the world, you simply can’t move. They are all desperate for solutions. Detroit is a great place to build that future to experiment.” Ford is hoping the 104-year-old train depot will be the beginning of a mobility corridor spanning Michigan Avenue from Detroit to Ann Arbor, connecting the most tech-forward cities in the region, that would serve as a “talent magnet” for the company, with the depot being the centerpiece.

Panel: Freezing out minority entrepreneurs is ‘leaving money on the table’

Michigan’s workforce and economy are increasingly represented by people of color, yet equitable opportunities for success are scant. By 2030, Michigan’s workforce will shrink by 350,000 people as retirees exit but the share of people of color will grow from currently a quarter of

Executive Chairman Bill Ford Jr. talks about Ford’s acquisition of the area surrounding and including the vacant Michigan Central Station.

the workforce to nearly a third, according to recent research by the W.K. Kellogg Foundation. “What we’re finding is there is tons of potential in the market,” LaJune Montgomery Tabron, president and CEO of the foundation, said during a Homecoming panel Thursday at the Lexus Velodrome in Detroit. “Employing all those not in the workforce today would create more than $3 trillion in GDP nationally and $36 billion today in GDP in Michigan. There’s an opportunity there because right now we're leaving money on the table.” That opportunity lies in giving people of color access through entrepreneurship, she said. The panel included Regina Gaines, co-owner and founder of wine tasting room House of Pure Vin; Ron Bartell, president of popular eatery Kuzzo's Chicken and Waffles and R&J Development; and Adrienne Bennett, president and CEO of plumbing contractor Benkari Mechanical LLC. The group shared the challenges of being black entrepreneurs. Bartell, a former cornerback in the National Football League, recalled the inability to access capital from banks to build out his restaurant — which generated $2.3 million in sales last year. “I had assets, cash and other business interests,” Bartell said. “They looked at me like a football player, not a businessman. If a black male like me, with money and a good credit score, can’t get financed there’s a problem.”

Michigan Women Forward to do $10M offering to support women entrepreneurs

Detroit-based nonprofit Michigan Women Forward will offer $10 million in community impact notes to support Michigan’s women entrepreneurs. It announced Thursday during Detroit Homecoming the launch of the Detroit Expats Loan Fund, within the larger offering, to target investment to Detroit women who are starting businesses. “Detroit Homecoming is an inspirational opportunity to (give)

people who have already come back to Detroit to invest” another vehicle to do it, Michigan Women Forward President and CEO Carolyn Cassin said. “Women are an important part of the revitalization of Detroit.” Over the past five years, MWF (formerly known as Michigan Women’s Foundation) has used philanthropic contributions and money from the state loan fund (that had to be paid back in just three years) to make microloans to 180 women entrepreneurs through loan programs and pitch competitions. About 90 percent of those investments have been in Southeast Michigan, the rest scattered around the state. The businesses range from drinking vinegars and a coffee shop, a hydroponic farm and a mushroom factory to an architecture firm and a phlebotomy training school. All but four of those companies are still operating, Cassin said, noting they collectively produced $18.5 million in revenue last year. MWF is seeking: J $6 million to fund microloans to women-owned businesses in the state J $3 million to fund a new, Detroit headquarters for MWF that will also serve as home to a women's entrepreneurship center and the Michigan Women's Historical Center and Hall of Fame, acquired by MWF last year. J $1 million for a new equity fund to enable MWF to begin making higher-risk, equity investments in a handful of select organizations as a pilot for a larger fund. “Before you’re ready for angel investing or venture funding, women, especially, have a very hard time finding small amounts of equity funding,” Cassin said.

Live music, local talent to play nights at Motown Museum’s new Ford Theater

Motown fans and music lovers have a new reason to visit the old music house on West Grand Boulevard in Detroit: live music. The new generation of sounds from the Motor City could take the stage each night at the Motown Historical Museum when its $50 million expansion is completed. A new theater being built on the museum campus will serve as a community space for local, national and world renowned recording artists to showcase their music and talent, museum CEO Robin Terry said Thursday at Detroit Homecoming. The theater is being sponsored by Ford Motor Co. and will don the automaker's name as part of Motown Museum's effort to restore neighboring properties and expand the museum. “This is a space where we take the best of the best that Detroit has to give, an authentic Detroit brand, and use that to provide inspiration,” Terry told the Homecoming audience. “We want to inspire entrepreneurs and enliven Detroit’s cultural community. We want singers, musicians to be cultivated as result of this space.” Phase one of the restoration began last October.

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DETROIT HOMECOMING

HUB

FROM PAGE 1

“I’m shifting the back end of my business — the design end — to Detroit,” said Reese, who has a store in Manhattan’s Garment District. “The front end will remain in New York — sales and outreach.” Reese is on the board of ISAIC. The local leaders of the group weren’t ready to announce the location of the manufacturing facility at Detroit Homecoming last week. But they say they have orders from clothing companies in place to start producing 3,000 units per month in February. At the same time, a former Detroiter and longtime fashion industry executive says he’s in talks with an international clothing brand to on-shore manufacturing from Asia to the Motor City. Jeffry Aronsson, a former CEO of Donna Karan International, has spent the past year leading an initiative for Mayor Mike Duggan called Project Treadwing that seeks to scale up Detroit’s fledgling fashion apparel industry. Aronsson first presented the idea at the 2017 Detroit Homecoming and gave an update at last week’s gathering of former Detroiters — an annual event produced by Crain’s Detroit Business. In early October, up to seven suppliers for the unnamed clothing brand will send representatives to Detroit for Aronsson and Duggan to make their pitch for establishing a

AARON ECKELS FOR CRAIN’S

A panel on Detroit’s fashion industry at Detroit Homecoming included Jen Guarino, vice president of manufacturing for Shinola (left); moderator Kelley Carter of ESPN, a Detroit expat; designer Tracy Reese; and former Donna Karan CEO Jeffry Aronsson.

manufacturing presence in the city, Aronsson said. “It’s exciting, but it’s still a dream, it’s still a vision and an idea,” Aronsson said. “We’re a work in progress, however — a precarious one.” The tier-one and tier-two suppliers are the key to establishing a largescale manufacturing presence for clothing and apparel in Detroit, Aronsson said.

Aronsson, Guarino and others in the fashion and apparel business contend the $2.5 trillion global industry is ripe for disruption as robotic assembly technology advances and customers have become more socially conscious about where their garments and accessories are made. “The fashion industry is running out of people and places to exploit,” said Guarino, whose Detroit-based

employer, Shinola, has grown into an internationally recognized brand for its made-in-Detroit watches, handbags and other luxury goods. Part of the argument the ISAIC group and Aronsson are making for Detroit to be a new U.S. hub for manufacturing centers on the waste and inefficiency built into a system that relies heavily on cheap labor in Third World countries to produce most of

the clothes Americans wear. Globally, the fashion and textile industry overproduces 15 billion more garments annually and the excess clothing ends up in landfills, Guarino said. That’s partly driven by “fast fashion” brands like H&M and Zara which depends on producing fashionable clothing in huge quantities cheaply to capitalize on trends quickly. “If Detroit could build on demand and reduce that amount of surplus by 500 million, that’s doable,” she said. “That’s a possibility.” The ISAIC facility will serve as a training center for textile workers to learn both traditional sewing skills as well as how to operate robotic machines, Guarino said. “We live in a time where robotics are coming — and coming quickly,” Guarino said in an interview for the Crain’s “Detroit Rising” podcast. “They’re not totally replacing manufacturing (workers). You still need human hands.” Reese said the push for Detroit to be a new hub for design and production of luxury clothing is not an altruistic cause. “We have a huge problem with overproduction and fast fashion, and that’s something I’m not about and I don’t want to be about,” said Reese, a Cass Tech High School graduate. “As we slow things down and become more reflective, being in Detroit feels right.” Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

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ATE N I M O TO N E C N A H LAST C Crain’s Leadership Academy isn’t your prototypical leadership development experience. The program puts leadership in motion and is intensely focused on the individual growth of its participants. Attendees get to make important connections and learn about industries and companies in their own back yard. Plus, they’re developing as leaders in ways that they can apply new concepts on the job and get feedback from peers. If someone comes to mind, don’t miss out on providing them an experience that could be career-changing.

CONTACT KEENAN COVINGTON AT KCOVINGTON@CRAIN.COM OR (313)446-0417 FOR MORE INFORMATION OR TO NOMINATE.

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SUMMIT FROM PAGE 3

“I always try to be reserved and not blow a lot of smoke with no results, so when I am concrete with what I am doing and concrete with the information that I want to disclose, I disclose it,” he said. He declined to say how much he paid Santa Monica-based SD Capital LLC for the mall, which has been deteriorating for years and has been the subject of a variety of redevelopment ideas. The property had been listed for just under $6 million. An entity affiliated with Ari-El closed on the purchase on Sept. 7. As part of the deal, Ari-El is slated to pay $2.89 million to demolish the 1.4 million-square-foot mall, a process that must begin by Sept. 25, 2019, and be complete within a year. Redevelopment plans for the mall have been varied over the years, but none have come to fruition to date. Most recently, the plan for the mall included a 12,000-seat arena with basketball courts, four hockey rinks, a wave pool, an IMAX theater, a hotel, 100,000 square feet of sports-related retail space, outlot restaurants, soccer and football fields and other uses. Those plans collapsed earlier this year. Among those involved in the planned redevelopment were former Detroit Lions wide receiver Herman Moore and former University of Michigan basketball player and current Oakland Community College men’s basketball coach Antoine Joubert. Moore was in talks to invest with the development group, while Joubert was a committed investor. Things ranging from baseball stadiums to water parks to multifamily housing have also been pitched. An effort to build a $9.5 million, 3,900-seat baseball stadium for the Ypsilanti-based Midwest Sliders baseball team in the Frontier League failed because of lack of financing. In 2013, a plan to build housing for

VISAS FROM PAGE 3

The average H-1B visa holder in metro Detroit earned $72,300 in 2016, according to data from the Pew Research Center, well above the $52,100 mean salary for the region. When elected, Trump pledged to overhaul visa programs to protect American workers. In April 2017, he signed the Buy American, Hire American executive order that sought to curb H-1B visas, and by proxy, H-4 visas. The U.S. Department of Homeland Security began the process to reverse the eligibility of H-1B spouses to work soon after and are pushing forward on the plan to rescind previously granted H-4 work eligibility. Technology groups, which represent large H-1B visa sponsors like Google and Amazon, among others, have argued it will hurt spouses, typically women, as well as the visa holders themselves. But their arguments are meeting deaf ears in the Beltway. H-1B denials were up 41 percent between October and December last year, compared with the three months prior, according to a July 2018 study by the National Foundation for American Policy. H-1B visa denials are likely sending many families back to the coun-

KIRK PINHO/CRAIN’S DETROIT BUSINESS

The enclosed portion of Summit Place Mall closed in 2009 following years of decline. Anchor stores Macy’s and J.C. Penney closed in 2010 and Sears closed in December 2014. Competition from nearby Great Lakes Crossing combined with the rise of Amazon.com to sink the shopping mall.

about 100 veterans and their families on the site fell apart. Ari-El owns the 22-acre Sears store at 435 North Telegraph, a purchase that was completed last year. DTE Energy Co. is planning a new storage facility with 225 workers there. The Detroit-based utility plans to tear down the building and build a new

50,000-square-foot building so it can consolidate workers from the Pontiac Service Center and leased space in Farmington Hills. The press release says the DTE project will serve as one of the overall mall project’s anchors. Summit Place opened in 1963 and was developed by what is now Farm-

ington Hills-based Ramco Gershenson Properties Trust (NYSE: RPT). First known as the Pontiac Mall, it began declining when nearby Great Lakes Crossing in Auburn Hills, developed by Bloomfield Hills-based Taubman Centers Inc., opened in 1998 and siphoned shoppers northeast.

The enclosed portion of Summit Place Mall closed in 2009 following years of decline. Anchor stores Macy’s and J.C. Penney closed in 2010 and Sears closed in December 2014.

try they emigrated and curbing H-4 work authorizations will put further strain on H-1B visa holders by cutting into family incomes by removing their spouse’s ability to work — spouses like Kondasani. Kondasani, 41, earned a bachelor’s of science in mathematics from Kakatiya University in India and immigrated to the U.S. in 2008, two years after her husband, Satya, came to metro Detroit to work as a mechanical engineer in the automotive industry. While she taught fifth-seventh grade in India, U.S. immigration rules prevented her from working here. By the time the rules changed in 2015, Kondasani hadn’t worked since leaving India in 2008. “I hoped I could continue working in the U.S. after pursuing additional education, but we had our own difficulties; recession, then kids and I was never able to pursue any further education,” Kondasani said. “After I received H-4 (an employment authorization document) in 2015, I explored several job opportunities but potential employers were not interested in someone who had a long absence from work.” She found work as a technical recruiter and pulled shifts at a local Kroger to bring additional income to her family before founding her day care this year. As of December 2017, the U.S. Citizenship and Immigration Services

had approved 90,946 H-4 work authorizations. If the administration revokes the work status, more than 90,000 people will lose their jobs, 93 percent of whom are women — potentially undermining the administration’s pledge in March 2017 to ensure the U.S. economy is fair to working women. More than 90 percent of H-4 visa holders have at least some college education and 46 percent with a bachelor’s degree, more than 24 percent with a master’s and 7 percent with a doctorate, according to a 2017 study published by researchers at Purdue University. Locally, roughly 15,000 H-1B visa status, a designation for skilled workers in specialty careers, applications were approved since 2010. The spouses of those workers are on H-4 visas, many with the employment authorization status like Kondasani. “At least a dozen of my friends are in a similar situation like me and live in the nearby neighborhoods,” Kondasani said. Research on international workers published earlier this year from the University of Tennessee found that removing the work status of H-4 visa holders would isolate them socially, raise domestic tensions and strain financial resources for families. “We are concerned policy changes like the one being considered for America are often made in the absence of complete information that

might help policy makers better understand the true breadth of likely consequences,” the study said. “... as many expatriate families who were temporarily benefited by the Obama administration’s immigration policies may have, in this time, bought a home or started their own businesses, which they may soon have to forgo if spousal work permits are canceled.” Kondasani said the potential revoking of her H-4 work authorization has created an atmosphere of fear for her family. “If I have to shut this home day care I will lose my earnings, won’t be able to support my family financially and won’t be able to provide additional employment to a caregiver and help parents who only prefer home day care,” she said. “And I wouldn’t be able to pay any more taxes to the government.” Kondasani and her husband live in an affluent community thanks to her husband’s mechanical engineering job — though he’s employed by a temp agency that farms him out to a local automaker — but the extra income has allowed her to provide her kids with additional education, such as music lessons. Her husband Satya, 41, has to apply to renew his H-1B visa next year and he’s fearful that the administration’s efforts to reduce immigration paths could cause him to lose his status. He’s been on a green card wait-

ing list since 2011. “If I don’t get an extension, my only choice is to head back to India,” said Satya, who was educated in Germany. “I haven’t lived in India for almost two decades. My kids were born here. They are pretty much regular American kids.” But Michael Nowlan, attorney and co-leader of the immigration practice group at law firm Clark Hill PLC in Detroit, said the administration isn’t likely to end the practice in the near future, despite those efforts. “It’s much harder to take away a benefit than it is to give it in the first place,” Nowlan said. “My prediction is it’s going to go a lot slower than the Trump administration wants. I expect litigation and if the plaintiffs find a judge that doesn’t think the administration followed the proper rules (in eliminating the work eligibility), we’ll get an injunction.” Nowlan said he’s still telling clients with H-1B workers to continue to apply for H-4 work eligibility because the rules haven’t changed. “H-1Bs (and H-4s) are under attack like I’ve never seen,” Nowlan said. “I’ve seen more denials since the beginning of this year than I’ve seen in my entire career. Meanwhile, employers are screaming that they want workers. It doesn’t make much sense.”

Kirk Pinho: (313) 446-0412 Twitter: @kirkpinhoCDB

Dustin Walsh: (313) 446-6042 Twitter: @dustinpwalsh

C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 1 7 , 2 0 1 8

United Way for Southeastern Michigan cuts 22 jobs By Sherri Welch swelch@crain.com

United Way for Southeastern Michigan has laid off about 10 percent of its employees and cut other operating costs to counter an unrestricted funding shortfall of $3.5 million. The Detroit-based nonprofit yesterday and today announced the layoffs of 13 people and eliminated another nine positions. The job cuts, made from the top down, are expected to save $3.5 million, president and CEO Darienne Driver said. At the same time, United Way has reduced operating costs on everything from consultant contracts to budgets for meetings, events and travel by 20 percent, she said. It’s now operating on a $56.7 million budget for fiscal 2019 with 171

employees. “This is a difficult decision. We definitely feel for our employees... but we have to pay attention to trends we see over time,” Driver said. Darienne Driver: Over the past Job cuts expected several years, to save $3.5M. more of the donations coming to United Way have been restricted to specific programs, Driver said, making them unavailable to help cover operating costs. “Seeing this is an ongoing trend, it was really important ... that we had to amend and review our current expenses and make sure all of our program agencies are kept whole and

Need to know

Detroit United Way cuts other operating costs by 20 percent J

J Moves made to counter $5.5 million shortfall in unrestricted funding J Program/agency cuts not planned heading into fiscal 2019

that we are absorbing any of the changes that need to be made within our current expenses,” she said. United Way is meeting its campaign goals annually, she said, but had to respond to a $3.5 million shortfall in unrestricted funding in fiscal 2018, which ended June 30. No cuts to programs or the agencies operating them are planned for fiscal 2019, Driver said. Instead, Driver, just two months

HOTEL FROM PAGE 1

“They just feel upset that we’re a current constituent, we’re current on our taxes, we’re a good citizen, and we’re treated with this kind of defamation of character,” Carreno said of his company’s board members. “It’s just not right.” Detroit City Council voted 2-6 on Tuesday on the plans for a second tower, which would have included a bridge over Washington Boulevard connecting the hotel to the Cobo Center — a standard feature for most convention centers in northern cities. Mayor Mike Duggan’s administration has been neutral on the project. “The silence from the administration is deafening in this situation,” Councilman Scott Benson said before voting “no” on the second hotel tower. Duggan’s planning department greenlighted the site plans for council approval months ago. “No one from Crowne Plaza has asked the mayor to get engaged in resolving their issue,” Duggan spokesman John Roach said Friday. “If they do, we will study it at that time.” Crowne Plaza hotel mangers say City Council members have leveled “false claims” that the hotel has faulty elevators; is staffed by temporary workers; doesn’t pay the state minimum wage; and has a bedbug infestation. The hotel’s managers have worked for months to disprove all of those claims, hoping to satisfy council members, who even questioned whether the company had the support of Cobo Center and the Detroit Metro Convention & Visitors Bureau to build a new hotel to support Cobo's large convention business. “We’ve gone to meeting after meeting and worked to tell the truth about the hotel and abide by any standard that they’ve set,” said Lee Cote, assistant general manager of the hotel. “And then every time that we go back, they’ve said, ‘Well, even though we said that was really the standard, here’s the new standard.’ And we’ve gone and met that time after time.” The one consistent request from City Council members has been for the hotel management to talk with Unite Here Local 24, the hospital workers union that Crowne Plaza

The Mexican-European investment group that owns the Crowne Plaza hotel in downtown Detroit is pulling the plug on a 28-story second tower next to the existing hotel at the corner of West Jefferson Avenue and Washington Boulevard. The new $164 million hotel would have created 250 new jobs.

employees rejected joining in a 1580 vote three years ago. “They keep mentioning over and over and over again that it’s not an issue of labor, but we spent about 70 percent of our time talking about labor,” said John Sabbagh, general manager of the Crowne Plaza. “So if it’s not about labor, then why are we talking about labor as much as we are?” At the request of council members, Crowne Plaza managers met with Unite Here Local 24’s leadership. But it wasn't until Tuesday’s meeting did council members ask the hotel operators to sign a neutrality agreement that would have waived the right of workers to have a secret ballot vote, Cote said.

“It’s not the council’s role to tell us or tell our employees that they should or should not be represented — that’s the employees’ decision,” Cote said. Councilwoman Janeé Ayers previously worked for Unite Here and on the campaign to organize the Crowne Plaza employees before she was appointed to an open at-large seat on City Council in February 2015. She was a leading voice of opposition to the new hotel on council based on working conditions in the existing hotel. At Tuesday’s council meeting, Ayers suggested there should be a “standard” minimum wage of $15 per hour in downtown Detroit’s hotels.

into her new position at United Way, said she’ll look to create a community impact council seated with nonprofit agency representatives and a volunteer engagement committee. “We need to pay attention to our donors and what they’re expecting. And it’s also critical we have a mechanism to listen to our community and partner agencies and what the needs are,” she said. United Way’s plan to relocate to the Fisher Building in March from its current location in the Bedrock-owned First National Building in downtown Detroit was in the works prior to Driver joining United Way, she said. But the move aligns with being more fiscally conservative, Driver said. “It’s not about whether or not you’re union,” Ayers said. “It is about the standard in the industry, and that’s what I’ve always talked about as far as this goes.” Ayers could not be immediately reached Friday for comment. Before voting “no” on the project in her own district, Councilwoman Raquel Castañeda-López said it was “disappointing” that Crowne Plaza’s managers wouldn’t sign a neutrality agreement with Unite Here. If the hotel’s management were neutral on a union vote, Castañeda-López said, it would “create an environment where everyone has equal access to participate and not to feel threatened.” Council President Brenda Jones said her “no” vote was based on bad customer experiences she hears from visitors to the Crowne Plaza hotel. Council members James Tate and André Spivey were the two lone “yes” votes for the second Crowne Plaza tower on Tuesday. Councilman Gabe Leland was absent. Operadora de Servicio Para Hoteles de Lujo bought the Pontchartrain hotel for $8.5 million in March 2012, according to CoStar Group Inc., a Washington, D.C.-based real estate information service. The hotel had sat vacant since August of 2009 after undergoing a series of name changes before the recession. The hotel reopened on July 17, 2013, under the Crowne Plaza brand name. The next day, the city of Detroit filed the largest municipal bankruptcy in U.S. history. “I do recall having investors calling and asking, 'What the hell have we done?’ ” Carreno said. “But our CEO was firm it was the right decision, and even though the city was going through rough times, the economy was in the right moment to make this investment.” Carreno said the ownership group has continued to invest $600,000 annually into the capital upkeep of the 367-room hotel. The hotel’s owners are not interested in taking legal action to fight for zoning approval to build a second tower, Carreno said. “I’d rather sit down and start building relations all over,” he said. “I would welcome (council members) to actually stay here and get the feeling of what we really are.” Chad Livengood: (313) 446-1654 Twitter: @ChadLivengood

www.crainsdetroit.com Editor-in-Chief Keith E. Crain President KC Crain Group Publisher Mary Kramer, (313) 446-0399 or mkramer@crain.com Managing Editor Michael Lee, (313) 446-1630 or malee@crain.com Product Director Kim Waatti, (313) 446-6764 or kwaatti@crain.com Digital Product Manager Carlos Portocarrero, (313) 446-6056 or cportocarrero@crain.com Creative Director David Kordalski, (216) 771-5169 or dkordalski@crain.com Assistant Managing Editor Dawn Riffenburg, (313) 446-5800 or driffenburg@crain.com News Editor Beth Reeber Valone, (313) 446-5875 or bvalone@crain.com Special Projects Editor Amy Elliott Bragg, (313) 446-1646 or abragg@crain.com Design and Copy Editor Beth Jachman, (313) 446-0356 or bjachman@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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C R A I N ’ S D E T R O I T B U S I N E S S // S E P T E M B E R 1 7 , 2 0 1 8

THE WEEK ON THE WEB

RUMBLINGS

Ford seeking fast-tracked tax breaks for train station

Is ‘scooter-able’ new way to measure distance?

SEPTEMBER 7-13 | For more, visit crainsdetroit.com

etroit City Council is being asked to fast-track $104 million in tax breaks for Ford Motor Co. to anchor its autonomous and electric vehicle development in Corktown so the automaker can begin work late this fall shielding Michigan Central Station from further winter deterioration. Mayor Mike Duggan’s administration intends to submit a plan to City Council by Wednesday that asks council members to abate $104 million in city taxes over 35 years as part of nearly $239 million in tax breaks Ford is seeking for the $740 million project, according to the Detroit Economic Growth Corp. Ford is seeking approval from City Council by Oct. 16 in order to meet an Oct. 31 deadline to secure $18.7 million in tax breaks from the State Tax Commission under the Obsolete Property Rehabilitation Act (OPRA), said Arthur Jemison, chief of services and infrastructure for Duggan’s office. The Dearborn automaker wants the OPRA designation before it starts working to secure the structure of the Michigan Central Station, which has been internally exposed to years of harsh Michigan winters due to leaky roofs and years of sitting windowless. “If (Ford) were to start doing that work, they would have to forgo part of the (tax incentive) package that is enabling the development to go forward,” Jemison told Crain’s. “The longer that they leave it exposed to the elements, in particular during the coldest part of the winter, the more likely they are to have increased costs later.” Ford needs to make major improvements to the roof over the front concourse of the 115-year-old depot to prevent further water damage, said Sarah Pavelko, senior real estate manager for the DEGC. Preserving the historical elements of the roof over the front concourse “will be more difficult, if not impossible, to salvage” if repairs aren’t made before year’s end, Pavelko said. “They need to stop the damage and stabilize the structure,” she said. Under state law, “work cannot begin” on the train station until the State Tax Commission grants the creation of an OPRA district for Ford’s property in Corktown, according to a DEGC presentation made Monday at a Corktown community meeting. “Severe structural issues exist in the train station that will affect Ford’s ability to preserve and restore the historic structure,” the DEGC’s memo says. “These repairs must be completed before winter.” A spokesperson for Ford said the company has been working within city and state guidelines for tax incentives to “ensure that we can begin some of the critical work to winterize the building and protect it from further damage over this next weather cycle.”

BUSINESS NEWS J The 28,000-square-foot Elevator Building near the east Detroit river-

LARRY PEPLIN FOR CRAIN’S

Ford needs to make major improvements to the roof over the front concourse of the 115-year-old Michigan Central Station to prevent further water damage.

Detroit digits A numbers-focused look at last week’s headlines:

2-6

The vote by which Detroit City Council rejected a request from the owners of the Crowne Plaza hotel downtown to build a second hotel tower across from Cobo Center. It was the second rejection of the plans.

$5,400

The average retail price for a Vespa. A pop-up dealership opened last week in the Fisher Building in Detroit’s New Center.

The number of metro Detroit White Castles where customers can now get Impossible Burgers, the plant-based patties advertised as looking and smelling like real ground beef.

front has sold to New York City investor Jean-Michel "Mitch" Wasterlain, who plans upgrades. The former bootlegging hub for the notorious Purple Gang had also been a Studebaker factory. Work such as roof improvements and window replacement will begin soon and take place over the next six months. J Federal regulators have cleared the $3.4 billion acquisition of Troybased Syntel Inc. by French computer services company Atos SE. In the acquisition’s last regulatory hurdle, the Committee on Foreign Investment in the United States approved that the deal was free of national security concerns, a news release said. Other previous approvals included clearances from regulatory agencies in Austria, Serbia and India. J United Shore Financial Services LLC is rescinding an earlier request for $1.9 million in brownfield tax incentives for its new headquarters in Pontiac. The wholesale mortgage company, previously based in Troy, had received approval from the state for the financing in February. President and CEO Mat Ishbia said the money that would have been spent

reimbursing United Shore for certain aspects of the redevelopment project could be better spent elsewhere. J After announcing plans to open a third restaurant south of downtown Ferndale, Bobcat Bonnie’s has found a more centrally located option that requires less work: the Zeke's Rock and Roll BBQ space in the heart of downtown. The eclectic Corktown-based restaurant business expects to move in quickly after Zeke’s closed last week, and to keep on as many of the 20 Zeke’s staff members who want to stay. J The Detroit Pistons and partners building the team's new headquarters and practice facility in the city’s New Center area have launched a jobs portal to help meet a hiring quota. The Platform LLC, the developer, and Christman-Brinker, the construction manager, joined the Pistons in rolling out the hiring system through Skillsmart Inc., a skills-matching website based in Gerantown, Md. Officials behind the project hope the workforce development system will help contractors fill more than half of construction jobs with Detroit residents. J The Pistons’ new headquarters will also be home to the state's first gym from New York-based Blink Fitness. It will take up 15,000 square feet in the Henry Ford Detroit Pistons Performance Center and be open to the public. It’s the first in a string of Blink gyms franchisee Tom Shumaker plans to open. He partnered with Saginaw native Draymond Green of the Golden State Warriors to pepper 20 locations across Michigan and the Chicago area.

NONPROFIT NEWS J The Belle Isle Conservancy is investing $400,000 to upgrade the historic James Scott Fountain. The investment announced last week represents nearly half of the amount raised during this year’s PwC Grand Prixmiere presented by Chevrolet, which took place during Grand Prix weekend. It will be dedicated to repairs to the fountain including improvements to the marble stairway starting this fall. Next season, repairs will be made to leaky and broken pipes and the control room. The main fountain bowl will also be repainted.

he electric scooter in Detroit is now having an impact on how new developments are being marketed. One of the developers behind the Lafayette West project on the site of a soon-to-be-demolished former Wayne State University pharmacy school building in Lafayette Park revealed a site plan describing the project as “scooter-able.” When a Crain’s reporter shared a photo of the slide depicting that on Twitter during the Detroit Homecoming event last week, it generated a discussion about whether that, in fact, was the most appropriate term to use when describing a project’s proximity to common Bird and Lime electric scooter hot spots. Should it be “scootable,” as the reporter suggested? “Scooter optimized,” as another Crain’s journalist believes? “Although ‘scootable’ is SEO-friendly,” replied one former Crain’s editor, using shorthand for search engine optimization. “Gotta

ANNALISE FRANK/CRAIN’S DETROIT BUSINESS

Lime-S electric scooters are pictured on Gratiot Avenue near Russell Street.

give it that.” One of the other developers on the project responded in a text message: “Lol! We never talked about anything being ‘scooter-able,’ but I can see why (he) would say that.” A groundbreaking ceremony on the $108 million Lafayette West project, which is slated to have 374 residential units by Novi-based Ginosko Development Co., is expected early next year.

ANNALISE FRANK/CRAIN’S DETROIT BUSINESS

Corktown-based social enterprise Rebel Nell made 300 jewelry pieces decorated with paint peeled and collected from the walls and floors of Michigan Central Station. The proceeds from the series commissioned by Ford Motor Co. Fund will go to four metro Detroit charities.

Ford Fund commissions graffiti art from station T

he Ford Motor Co. Fund commissioned Corktown jewelry maker Rebel Nell to create a collection from Michigan Central Station graffiti paint. The 104-year-old depot that Dearborn-based Ford Motor Co. plans to rehabilitate as part of a mobility-focused Corktown campus stars in the 300-piece jewelry series. An estimated $35,000-$40,000 in proceeds from the pendants, rings, earrings and pins will go to four metro Detroit charities. They’re on sale now on Rebel Nell’s website; prices are $75 and up. Rebel Nell, co-founded by Amy Peterson and Diana Russell in 2013, employs disadvantaged women in Detroit to design and manufacture jewelry adorned with graffiti that’s fallen from walls around the city. Ford commissioned the pieces as part of a larger $25,000 gift to Rebel

Nell, said Shawn Wilson, manager of community engagement for the Ford Fund. It also went toward hiring two employees, bringing the jewelry maker’s staff to 15, and holding graffiti-jewelry workshops during Ford’s public tours of Michigan Central Station in late June. When Wilson first looked around the long-vacant depot as the automaker’s plans took shape, “right away I thought about Rebel Nell,” he said. The four recipients are: Plymouth-based Love Runs, which fights human trafficking; Dearborn Heights-based Vista Maria, which provides services to vulnerable youth; Covenant House Michigan, which provides shelter and programs for homeless and at-risk youth; and Detroit-based Coalition on Temporary Shelter.

COUNTDOWN

TO THE BOOK OF LISTS

DAYS LEFT The Book of Lists is an annual data resource which culminates Crain’s yearround efforts to gather business intelligence and data in Southeast Michigan. It is a staple resource used all year long. AD CLOSE DATE:

HERE’S WHAT OUR READERS HAD TO SAY* • 82% save the Book of Lists issue • 96% reference the issue more than once • 77% of those surveyed actively use the lists • Top 3 ways readers use the issue: generate business leads, competitive analysis, find/reach vendors • Top 3 actions taken as a result of reading the issue: saved issue, researched a company further, shared list with coworkers

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Don’t miss your opportunity to extend your brand reach in this must-read and highly-valued issue. For more information and to reserve your ad space contact advertising director Lisa Rudy at lrudy@crain.com

*Qualtrics Book of Lists subscriber survey, 2018.

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