Crain's Detroit Business, Nov. 26, 2017 issue by Crain's Detroit Business

Plum Market, BJ’s plan growth Page 6

NOVEMBER 26 - DECEMBER 2, 2018 | crainsdetroit.com

Guardian neighbor sold Page 3

REAL ESTATE

Moving (even) more upscale

High-end projects changing the face of Birmingham

The Townsend invests to keep athletes, execs, celebs coming back

By Kirk Pinho kpinho@crain.com

Developers are changing downtown Birmingham, no more than five stories at a time (per zoning rules). More than a half-dozen projects totaling well north of $250 million are either under construction or in the serious planning phases, working their way through the various city approval processes. In all, they will bring a new luxury hotel, swank condominiums and apartments (“affordable for Birmingham,” one developer emphasized of the rentals), tens of thousands of square feet of office, trendy upscale retail and additional parking to one of the region’s most affluent communities. The central business district’s walkability, household income, surrounding areas and desirable amenities like shopping and dining are attracting developers who see an unmet demand for high-end condos and top-of-the-line office space, among other uses. They come with the known Birmingham names: Surnow and Shiffman, Saroki and Jonna, Robertson and Simon. All working on projects of varying scales and types. But the biggest project of them all is the 4 acres at Old Woodward Avenue and Bates Street, which is targeted for a minimum $125 million redevelopment into approximately 58 apartments, 21,000 square feet of retail space and 46,000 square feet of office space, plus 1,400 parking spaces across a new public-private partnership in which the city would be responsible for improving or creating 1,276 spaces, according to public documents. SEE BIRMINGHAM, PAGE 20

By Bill Shea bshea@crain.com

CONTRIBUTED RENDERING

The Jeffrey, shown here in a rendering, is one of a raft of new projects that are rapidly changing the face of Birmingham. Sam Surnow, president of Birmingham-based real estate firm The Surnow Co., is overseeing the property redevelopment.

Need to know

 More than a half-dozen projects totaling well north of $250 million, like the Daxton hotel, above, are either under construction or in serious planning phases  Projects include new luxury hotel, swank housing, upscale retail, additional parking

Developers see a demand for high-end condos and top-of-the-line office space 

LARRY PEPLIN FOR CRAIN’S

The Townsend Hotel has long been known as celebrity lodgings. Now it faces competition from a new hotel under construction.

SEE TOWNSEND, PAGE 20

HEALTH CARE

INSIDE

Battling suicide High rates for professionals. Page 10 How VA is helping veterans. Page 15

Blue Cross ‘work-at-home’ surge emblematic of the times

By Jay Greene jgreene@crain.com

crainsdetroit.com

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The notion of a celebrity hotel brings to mind a kinetic Technicolor vision of Led Zeppelin riding motorcycles though the halls of the old Continental Hyatt House, or John Belushi overdosing a mile up the Sunset Strip at the fabled Chateau Marmont. The Townsend Hotel in downtown Birmingham is a celebrity hotel, catering to a wealthy clientele of visiting entertainers, professional athletes, business executives and politicians, but it’s decidedly not a place where rock stars are hurling TV sets out of the windows at 4 a.m. “Not that way at all. The calm of the Midwest,” said Steven Kalczynski, the Townsend’s patrician managing director and 40-year veteran of the upscale hotel industry, during a recent interview with Crain’s. Instead, the 150-room hotel offers quiet luxury and privacy to celebrities and sports stars passing through metro Detroit, and it has a long resume of awards such as AAA’s Four-Diamond ratings, Forbes recommendations, and a No. 11 ranking in Condé Nast Traveler’s “Top 15 Hotels in the Midwest” to burnish its reputation. Yet an ongoing hotel boom has the 30-year-old property looking over its shoulder and doubling down on its prestige as the metro region’s inn of choice for the rich and famous. Aside from maintaining the customer service from uniformed doormen and bellhops — they’re trained to greet guests by name — The Townsend’s ownership has put what Kalczynski said is $10 million into renovations over the past five years.

One of Detroit’s largest employers has seen a groundswell of takers for a broad experiment with telecommuting. Demand is high for eligible employees wanting to work at home in a project underway at Blue Cross Blue Shield of Michigan’s downtown Detroit headquarters. Nearly 1,400 of Blue Cross’ 6,000 employees at the Renaissance Center and five other Blue Cross buildings in Detroit have applied to participate in

BlueSpace, a telework program that began as a pilot (with 364 employees) in late 2017, said Tricia Keith, the health insurer’s executive vice president, chief of staff and corporate secretary. It was expanded in August after CEO Dan Loepp gave a positive report to the Keith Blue Cross board and senior management at a July retreat. By the end of 2019, all 1,381 approved

employees will have workat-home or out-of-office options that will range from one to four days per week, Keith said. The program is emblematic of a quickly shifting workplace environment driven by millennials’ interest in flexibility and work-life balance — a trend that also could lead to renting less pricey office space. SEE BLUE CROSS, PAGE 18

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MICHIGAN BRIEFS

INSIDE

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

Ex-MSU president charged with lying to police

Former Michigan State University President Lou Anna Simon was charged last Tuesday with lying to police during an investigation of the handling of serial sexual abuser Larry Nassar — the third current or former campus official other than Nassar to face criminal charges in the scandal, the Associated Press reported. Simon, who stepped down under pressure in January, spoke with state police investigators May 1. She is accused of making two false and misleading statements — that she was unaware of the nature of a sexual misconduct complaint that sparked the school’s 2014 Title IX investigation of Nassar, and that she only knew a sports medicine doctor, not Nassar himself, was under investigation at that time. If convicted of two felony and two misdemeanor counts of lying to a peace officer, 71-year-old Simon faces up to four years in prison. The Mason resident is scheduled to be arraigned Monday in Eaton County near Lansing. One of her attorneys, Lee Silver, called the charges “completely baseless” and said he had not seen a “shred of evidence” to support them. “In my opinion, the real crime here

is that these charges are even being brought,” he said. University spokeswoman Emily Guerrant said Simon, who stayed on at MSU to do research while preparing for a return to teaching, is taking an immediate unpaid leave of absence from her $750,000-a-year job “to focus on her legal situation.” The charges were filed by special independent counsel Bill Forsyth, who was appointed by Michigan Attorney General Bill Schuette to investigate Michigan State’s handling of Nassar. Forsyth declined comment. Simon is the fifth person to be criminally charged in the wake of Nassar’s convictions for molesting young female athletes under the guise of treatment. Numerous other people have lost their jobs or have been sued. In June, Simon told a congressional committee that she was “horrified” that Nassar’s crimes occurred during her tenure and had she known he was sexually abusing young women, “I would have taken immediate action to prevent him from preying on additional victims.” She also told senators that when she was informed of the Title IX investigation in 2014, she knew it involved a “sports medicine physician” but did not know Nassar was the one under review. In August, Schuette charged former MSU gymnastics head coach Kathie Klages with lying to an investi-

ASSOCIATED PRESS

Lou Anna Simon resigned as president of Michigan State University in January.

gator when she denied that witnesses told her years ago about being sexually assaulted by Nassar. In March, the ex-dean of the osteopathic medicine school, William Strampel, was charged with neglecting his duty to enforce examining-room restrictions imposed on Nassar after the 2014 Title IX investigation. That investigation, initiated by a patient, resulted in the school clearing Nassar. He was fired in 2016 after another victim went public. Hundreds of girls and women have said Nassar molested them when he was a physician, including while he

worked at Michigan State and Indianapolis-based USA Gymnastics, which trains U.S. Olympians. Nassar, 55, last year pleaded guilty to sexually assaulting nine victims and possessing child pornography, and his sentences equate to life in prison.

SpartanNash buying Indiana grocery chain

Grand Rapids-based SpartanNash Co. is acquiring Martin’s Super Markets Inc., an Indiana-based chain. The Michigan grocery chain announced the deal last week, the Associated Press reported. Martin’s is

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based in South Bend and has 21 stores and 3,500 employees in northwestern Indiana and southwestern Michigan. For the fiscal year that ended July 29, 2018, Martin’s had more than $450 million in net sales, according to a news release. SpartanNash supplies grocery stores and also operates its own markets, including Family Fare and D&W Fresh Market. Martin’s has been a customer since 2005. Martin’s president, Rob Bartels, said the family-owned company shares similar values with SpartanNash. He said the company was “seeking a partner we could trust.” Terms of the deal were not disclosed. The transaction is expected to close early in the first quarter of the fiscal year ending Dec. 28, 2019. The Food Partners acted as financial adviser and Warner Norcross & Judd LLP acted as legal adviser to SpartanNash. PJ Solomon acted as financial adviser and Simpson Thacher & Bartlett LLP as legal adviser to Martin’s.

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REAL ESTATE

A good horse farm is hard to find By Kirk Pinho kpinho@crain.com

If you’re in the market for equine real estate, don’t expect an easy trot finding it. That’s not because properties aren’t available; there are certainly opportunities in the five-county metro Detroit region and throughout the state. It’s because the multiple-listing service, commonly known as MLS,

Need to know JJMultiple-listing service doesn’t give real estate agents many options for listing horse-specific properties for sale JJMarket for horse farms overall declining given the state’s fading horse racing industry JJLatest Michigan State University survey found approximately 155,000 horses in the state

doesn’t give real estate agents many options for listing horse-specific properties for sale, said those specializing in that niche market. That makes searching for the right property a challenge. “The MLS isn’t set up to really give all the information that a potential buyer would want on these equestrian facilities,” said Nichole McCaig, whose Dexter-based Visible Homes LLC real estate company has sold 42

equestrian properties totaling $21.47 million since 2016. Listing options such as whether a property has an indoor or outdoor arena or more specific criteria about its type of fencing or stalls would also go a long way in helping buyers and sellers find the right property for them, said Debby DeHart, a Commerce Township-based agent with Real Estate One. “We have to put those things in the

REDEVELOPMENT

MANUFACTURING

By Annalise Frank

dwalsh@crain.com

MLS write-up,” she said. It creates unnecessary hurdles in an area where there is already an overall declining market for horse farms, particularly on the commercial side given the state’s fading horse racing industry, DeHart said. Michigan’s horse racing tracks — most recently Hazel Park Raceway and Northville Downs — have gradually been closing over the years. SEE EQUINE, PAGE 21

New CEO ready as auto Wayne County strikes deal to sell Guardian Building neighbor supplier poised for growth By Dustin Walsh

afrank@crain.com

Wayne County is close to selling the squat building hugging the eastern wall of the iconic Guardian Building in downtown Detroit. The vacant, 30,000-square-foot building on Woodward Avenue between Campus Martius Park and the riverfront has been seen as an obstacle in the county’s financial recovery, which includes offloading unused space. Pending Wayne County Commission approval, Zaid Elia of Birmingham-based Elia Group plans to buy the glass-covered building at 511 Woodward Ave. for $4.65 million. It neighbors Wayne County’s municipal offices in the 40-story, also county-owned Guardian Building. Wayne County officials said the tentative deal would include a move of the Downtown Detroit Partnership from its current headquarters at One Campus Martius, which is also home to Quicken Loans Inc. The DDP oper-

COSTAR GROUP INC.

Wayne County has a tentative deal to sell the 30,000-square-foot building at 511 Woodward Ave. in the heart of downtown Detroit.

ates parks and oversees programs aimed at improving downtown. The building’s renewal would feature a welcome center on its ground floor for the county and city, with involvement from both the county and DDP. Downtown hasn’t had a wel-

come center since Detroit Experience Factory’s closed this spring, and County Executive Warren Evans said to his knowledge the county hasn’t operated an official one in recent memory. SEE BUILDING, PAGE 19

Busche Performance Group is a company maturing. Two decades ago, the company began in a pole barn on family farm acreage in Albion, Ind. Now the automotive casting and machining supplier is based in Southfield and ramping up to hit $550 million in revenue in 2021. The company’s metamorphosis has been a slow build from when Nick Busche, 56, founded the company in 1997. Through several small acquisitions, the company was able to cement itself as a solid lower-tier solution for other regional suppliers in the automotive sector. Now it’s hired a new top executive, one who is also maturing into the role. Joseph Perkins, 50, was hired as CEO in August — his first shot at the top role in a C-suite — after years of moving up the ranks, serving as CFO for Auburn Hills-based Key Safety Systems during its quest to acquire bankrupt Japanese airbag supplier Takata Corp. out of bankruptcy. Key Safety, now called Joyson Safety Sys-

Need to know

JJSouthfield-based Busche Performance Group ramping up to hit $550 million in revenue in 2021 JJNew CEO Joseph Perkins assembles new management team JJ$150 million recapitalization left Busche with a new majority owner, influx of cash

tems, closed the $1.6 billion deal in April, more than doubling the size of the supplier. Prior to joining Key Safety in 2016, Perkins was the CFO of steering system supplier Nexteer Automotive for three years. “Look, I always wanted to be CEO, but once the Takata deal was done, the board talked to me about becoming CEO but we all agreed that taking over a $7.5 billion company wasn’t the best role to get your CEO legs,” Perkins said. “Key Safety was the little engine that could and this is the same thing all over again. This is an opportunity to build this company up to its true potential.” SEE BUSCHE, PAGE 19

MUST READS OF THE WEEK Shapero Hall demolition scheduled to begin

Menorah in the D Festival of LIghts Dec. 2

Temporary roller rink opens downtown

Former Wayne State University pharmacy school to make way for new development. Page 22

Fest will honor eight metro Detroit Jewish residents and victims of last month’s shooting at a synagogue. Page 22

A free-of-charge roller rink is opening in the first-floor retail space of the 1001 Woodward skyscraper on Nov. 30. Page 4

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McCarty named new CEO of UHY Advisors By Anisa Jibrell ajibrell@crain.com

Steven McCarty set his sights high more than 10 years ago, and this week the metro Detroiter was named CEO of national tax and advisory company UHY Advisors. McCarty, a managing director of the Chicago-based firm, will succeed Tony Frabotta effective Jan. 1, UHY announced Monday. Frabotta will Steven McCarty: assume the role of chairman. To focus on The 50-yearexpanding. old is based in Detroit and is a member of the firm’s Michigan Region Executive Committee and board of directors. He most recently oversaw UHY’s corporate finance practice and was an active member of the national manufacturing practice, according to a news release and the company’s website. He began his career with UHY as a staff accountant in 1992, eventually moving his way up to a partner role in 2004. In his 2007 Crain’s 40 under 40 honoree profile, he declared his goal to become CEO. “Our firm is growing while the accounting profession as a whole is con-

Need to know JJMetro Detroiter succeeds Tony Frabotta JJHe will assume his new role Jan. 1 JJSteven McCarty will be based in the firm’s Detroit office

solidating,” McCarty said in the release. “I look forward to focusing on the development of our associates and expanding our UHY footprint.” Before joining UHY, McCarty was director of finance at Beaumont Services Co., which manages hospital construction and facility projects for Beaumont Health. He earned a bachelor’s degree in accounting from Walsh College. “Steve has been with UHY nearly 27 years and has proven himself as an exceptional colleague, industry professional and leader within the firm,” Frabotta said in news release. “Steve has been a trusted confidant to clients and an active participant in the local communities which UHY serves.” UHY employs 380 in Michigan, making it the seventh-largest accounting firm in Southeast Michigan on Crain's largest Michigan accounting firms list. Anisa Jibrell: (313) 446-1612 Twitter: @anisajibrell

COURTESY OF LIBRARY STREET COLLECTIVE

The Rainbow City Roller Rink is under construction at 1001 Woodward and will open Nov. 30.

Temporary roller rink opening in 1001 Woodward building By Kirk Pinho kpinho@crain.com

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A free-of-charge roller rink is opening in the first-floor retail space of the 1001 Woodward skyscraper on Nov. 30. Scheduled to run through Jan. 27, the roller rink is sponsored by Dan Gilbert’s Bedrock LLC real estate company and the Quicken Loans Inc. Community Fund. Rainbow City Roller Rink is the product of the Detroit-based Library Street Collective and the artist duo of Samuel Borkson and Arturo Sandoval III, who go by the name FriendsWithYou. It is the latest iteration of the group’s Rainbow City project, which has been shown in New York City and Miami and was originally commissioned by the Luminato Arts Festival in Toronto, according to a

fact sheet provided by Bedrock. The still-under-construction rink features a series of balloon-like sculptures suspended from the 1001 Woodward ceiling “reminiscent of carnivals or revolving signs off west coast highway roads,” the artists wrote in a statement. Anthony Curis, partner of the Detroit-based Library Street Collective art gallery, said the rink is 69 feet by 53 feet, with an overall area footprint of 88 feet by 60 feet. He said it can accommodate 50-60 skaters at a time. “The art of FriendsWithYou spreads a purity and positivity very rarely experienced outside of childhood, but is created for people of all ages,” Curis said in a statement.” The rink will be open 2-9 p.m. Wednesdays through Sundays.

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Plum Market set to open 2 stores in Detroit next year By Annalise Frank afrank@crain.com

On its current trajectory, Plum Market would open two Detroit stores by mid-2019. The Farmington Hills-based specialty grocer and food service company announced plans a year ago to open a cafe and market this spring in the Henry Ford Detroit Pistons Performance Center in the New Center area. And earlier this month it said it signed on to open in the Ally Detroit Center skyscraper downtown in the summer. The two Plum Market Kitchens won’t be full grocery stores. The location at the Ally center, owned by Dan Gilbert’s Bedrock LLC, will sell “basics” such as condiments, bags of tortilla chips, cut fruits and vegetables, and possibly select seasonal produce, Plum Market co-founder

Fa gro Plu sm De do Ma

BED

Need to know JJ Co-founder Matt Jonna sees niche for prepared foods, groceries in Detroit JJOrganics-focused grocer to open in Ally Detroit Center, Pistons practice facility JJAlly location downtown to have full-service bar, grab-and-go foods and event space

and CEO Matt Jonna said. Plum Market Kitchen is a small-format spin-off of the full organics-focused grocery stores with which the company started. It has Plum Market Kitchens at Detroit Metropolitan Airport, Oakland University and Northwestern University north of Chicago. “An emphasis on prepared foods is a big thing for all of them ... (What) kind of spurred these small formats,

Squeeze more out of your dental plan. BJ’s Wholesale plans Michigan expansion By Anisa Jibrell ajibrell@crain.com

East Coast wholesale chain BJ’s Wholesale Club Holdings Inc. is stretching its national footprint into Southeast Michigan in late 2019. Two new locations with gas stations are set for Madison Heights and Taylor, BJ’s said in a news release. Westborough, Mass.-based BJ’s operates 216 clubs and 136 gas stations across 16 states. The company went public in June after seven years as a privately held company. Both metro Detroit locations are planned to be just less than 100,000 square feet. One will be at 29101 John R Road in Madison Heights, the former site of a Super Kmart, Kirk Saville, senior vice president of corporate communications, wrote in a statement emailed to Crain’s. That’s just a mile from a Sam’s Club and 2 miles from a Costco store. The other location will be at Eureka Road and Racho Boulevard in Taylor, Saville said — about three miles from a Sam’s Club.

By A

afran

Need to know JJBJ’s operates 216 clubs and 136 gas stations across 16 states JJThe two new clubs will be located in Madison Heights and Taylor JJBoth metro Detroit locations are just less than 100,000 square feet

The company said it is still in the process of finalizing details about its investment in the new stores, and declined to disclose whether the locations were purchased or are being leased. BJ’s is a membership-based warehouse store, similar to Costco and Sam’s Club, offering fresh produce, meat and baked goods, as well as an online pickup option and digital coupons. The expansion will create 300 jobs between both locations, and the construction project will generate a total of 1,000 jobs, BJ’s said in its release. Interplan LLC has been retained as the designer of the two locations, Sav-

A rendering of one of BJ’s Wholesale Club’s new locations in Michigan.

ille said. “We’re thrilled to enter such a dynamic market and be a part of Michigan’s future ... ” CEO Christopher

Baldwin said in a statement. “Our expansion into this market is the result of our new, data-driven model for opening clubs, and we see significant

BJ’S WHOLESALE CLUB

potential in the region.” Anisa Jibrell: (313) 446-1612 Twitter: @anisajibrell

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Farmington Hills-based specialty grocer and food service company Plum Market plans to open a new small-format store in the Ally Detroit Center in the city’s downtown, between Campus Martius Park and the riverfront. BEDROCK LLC/PLUM MARKET

for us, is we see a niche in the market. Our prepared foods departments are popular in our large-format stores,” Jonna said. “We see a need for what we do on the prepared foods side in locations like the Ally center in Detroit.” The 8,000-square-foot “street concept” store, set to open in the Ally building at 500 Woodward Ave., would have a cafeteria with hot meals, salads, sandwiches, soups and sushi. It will also have a full-service bar with wine, beer and liquor; a coffee bar; fresh-cut flowers; and Zingerman’s baked goods. It’s bigger than the usual Plum Market Kitchen model, with expanded grocery items and more seating, Jonna said. It will seat 100. A rentable event space called the Spirit Room will include patio seating in the easily recognizable building between Campus Martius Park and the riverfront. Saroki Architecture is the architect and Jonna Construction is the contractor on the incoming downtown store. Plum Market declined to disclose investment and lease details. Some of the 25-year-old, 979,489-square-foot building’s main tenants are Ally Financial Inc., Townhouse restaurant and law firm

BEDROCK LLC/PLUM MARKET

Plum Market’s downtown Detroit location in the Ally Detroit Center will sell flowers, prepared foods and basic groceries at 500 Woodward Ave. It’ll also have a full bar.

Clark Hill PLC. Plum Market will replace the Bistro, which was expected to fully move out in early November. Additional details on the change were not immediately available.

More coming? Plum Market will enter a restau-

rant-laden section of downtown without much in the way of grocery options. City Market two blocks east sells some fresh produce. Further east of downtown is Detroit’s first Gordon Food Service on Jefferson Avenue and an incoming small-format Meijer nearby. The city could also see more

Plum Market stores in coming years. Jonna said he sees opportunity elsewhere in Detroit to sell prepared food and groceries as more young people choose to live in the city. “We could have several more Plum Market Kitchens and even a full Plum Market store in the city with the way it’s moving right now,” he said. The 11-year-old grocery chain co-owned by Matt and Marc Jonna has large-format locations in Ann Arbor, Bloomfield Township, West Bloomfield Township and Chicago. Matt Jonna declined to disclose revenue. He said the company has seen an average yearly sales growth rate of 15-20 percent. Plum Market also operates 11 corporate and school cafeterias, including for Lear Corp., Grosse Pointe Academy and Detroit Country Day School. It expects to open three more next year. It also expects to announce another Plum Market grocery store in metro Detroit before the end of the year and is “working on several more” between Detroit, Chicago and Indianapolis, Jonna said. Annalise Frank: (313) 446-1612 Twitter: @annalise_frank

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Child care center, The Lip Bar among Motor City Match winners By Annalise Frank afrank@crain.com

A child care center, a co-working space with retail and a coffee shop and The Lip Bar LLC, a cosmetics company that sells across the U.S. through Target are among the latest 10 winners of Detroit’s small-business funding initiative Motor City Match. Founder Melissa Butler said she’ll use her award to open a Lip Bar retail location in the new Shinola Hotel. The downtown hotel set to open in December is a joint venture between Shinola/Detroit LLC and Dan Gilbert’s Bedrock LLC. Asked for comment about the cosmetics maker as a tenant, a Bedrock spokewoman said, “We do not comment on rumors or speculation.” The Lip Bar got $20,000 from Motor City Match to assist with buildout of a 300-square-foot shop that Butler said is planned for a space in the Shinola Annex, a retail corridor next to the hotel. Butler did not disclose a total build-out cost. The store would offer makeup services, as well as products not offered online or through the 500 Target

JACOB LEWKOW FOR CRAIN’S

Lip Bar founder Melissa Butler.

stores that sell The Lip Bar’s cosmetics. The grant will help Butler create an expensive storefront that’s “young and fun and tech-savvy,” she said. “We really wanted to create a very particular atmosphere and environ-

ment, and I think that’s really what retail requires these days,” she said. People “go to shop in stores for the experience.” The Lip Bar joins other winners this round including Order THY Steps Learning Center, a childcare development facility on Mack Avenue that was awarded $50,000; Detroit-style pizza company Michigan and Trumbull, which got $55,000 for a location in Corktown; and Poppies/Rose’s Fine Food, which got $50,000 for a full service restaurant and bakery serving Polish inspired fare on the east side. Ten businesses in all are set to receive shares of $500,000 in the Detroit Economic Growth Corp. program’s 13th round of awards, according to a news release. DEGC leaders announced winners last Monday at Coyote Hawk Design Center. Motor City Match sought to highlight the co-working facility for designers and entrepreneurs in Detroit’s Islandview neighborhood that won $45,000 last year in the program’s seventh round. The latest round of cash awardees are 84 percent minority-owned, 76 percent woman-owned and 63 per-

Need to know 

The Lip Bar plans Shinola Hotel location

Awardees also include two pizza makers, Order THY Steps Learning Center 

 Small-business grant-making program announces recipients of $500,000 in 13th round

cent are owned by Detroit residents, according to the release. Motor City Match has given awards to 1,200 businesses total since it started in 2015. It also gives out smaller awards for business plans and space assistance. Crain’s reported in August on the evolution of the small-business incentives program. As of then, officials were pushing the program to become a more refined tool for small-business incubation, as well as a grant-making program. Applications for the 15th round open Friday at www.motorcitymatch.com. Winners of the 13th round cash awards are:  NOIS (Neighborhood Office and Incubator Space), $100,000 for a co-working space with retail store and

coffee shop at 3439 Livernois Ave.  Textures by Nefertiti, $70,000 for a holistic all-inclusive hair spa at 6525 Woodward Ave.  Toss & Sauce, $60,000 for a chef-inspired pizzeria at 18613 Livernois Ave.  Michigan and Trumbull, $55,000 for a Detroit-style pizza company at 1439 W. Elizabeth St.  Eats All Good, $50,000 for vegan, gluten free snacks at 2910 E. Jefferson Ave.  Order THY Steps Learning Center, $50,000 for a child care development and learning center at 10605 Mack Ave.  Poppies/Rose’s Fine Food, $50,000 for a full service restaurant and bakery serving Polish inspired fare at 1400 Van Dyke Rd.  Mt. Elliott Studios, $25,000 for a co-working art and design space at 2915 Mt. Elliott St.  The Lip Bar LLC, $20,000 for a location at 1400 Woodward Ave.  The Vehicle Services Group LLC, $20,000 for a mobile vehicle steam detailing service at 309 Harper Ave. Annalise Frank: (313) 446-0416 Twitter: @annalise_frank

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OPINION COMMENTARY

EDITORIAL

Taxpayers shouldn’t China’s not waiting while we foot wireless bill fall behind on education

his week, as lawmakers return to Lansing for the last session of the term, they should squint hard at a proposal being pushed by wireless carriers that would make it easier and cheaper for them to install new technology on utility poles. A proposal, Senate Bill 637, would set a fixed lease rate of $20 a year paid to local municipalities and agencies for each pole the carriers use to deploy the new, 5G technology. The idea is to improve the available infrastructure for faster wireless data connections. That’s a worthy goal. But this proposal puts costs for paying for those improvements in the wrong place. Much of the cost of the proMuch of the cost posal will fall on county road of the proposal will fall on county agencies. That $20 won’t come close to covering the road agencies. cost of having even one emThat $20 won’t ployee drive out to each site come close to for legally required inspeccovering the cost tions. of having even one That means that a good employee drive chunk of the cost of this bill out to each site for will fall not on the wireless legally required providers or their customers who are using the service, but inspections. on taxpayers at large. That’s not smart policy. And it could lead to the diversion of a county road commission’s finite resources away from where the money is needed most: Michigan’s crumbling roads. Bill sponsor and State Sen. Mike Nofs, R-Battle Creek, says he was trying to keep the cost low to look out for cellphone customers. But somebody is paying the freight regardless. It’s clear that the Sprints and AT&Ts of the world find the value in this technology to be far higher than that $20 a year. As Crain’s Chad Livengood reported last week, Sprint already had a contract to lease 250 traffic poles for $1,250 each to help it build out its network, which would have put $1,000 for each pole in Oakland County’s treasury. We’re not advocating that the state try to make the pole rentals a cash cow for local governments. That would unnecessarily impede the build-out of the new networks, which are an economic plus for the state. Having one policy for all installations rather than forcing companies to negotiate a boatload of oneoff agreements makes solid sense. At the same time, a compromise should be worked out to at least cover the counties’ costs and not create what would in effect be a new taxpayer subsidy.

LETTERS

In Snyder, we have had it good

To the Editor: In Rick Snyder, Michigan had as nonpolitical and non-beholden a governor as we are likely to see in America these days. Like everyone, he made his share of mistakes, and I didn’t agree with him on every issue, but he brought stability, prosperity, and needed civility for 8 years, for which I’m very grateful. Can anyone

argue we’re not leaps and bounds above where we were 8 years ago? Thomas M. Doran Plymouth Send your letters: Crain’s Detroit Business will consider for publication all signed letters to the editor that do not defame individuals or organizations. Letters may be edited for length and clarity. Email: malee@crain.com

read with interest the comments of Consumers Energy CEO Patti Poppe on education while sitting on a tarmac waiting to return to China. She believes school consolidation would free up more money for classroom instruction and supporting educators. She is right. I made similar observations in a 2004 report to Gov. Jennifer Granholm and the State Board of Education while serving as Michigan’s state superintendent of schools. They failed to act. Pretending to fix a hole in your roof does not keep the rain out. These issues are going to need to be addressed if we are going to invest in education that will prepare our children for their future and not our past. The viability of our society, the strength of our economy, the quality of our lives and our place in the world are inextricably linked to the quality of education provided to our youth. We are living in a hyper-competitive, disruptive, technologically driven (think AI) global economy where ideas can and do move around the world instantaneously. We need to educate far more of our youth to higher and higher levels, to be able to collaborate and compete on the world stage and fill the jobs here at home. Education Week’s rankings of state education systems ought to scare any thinking policymaker — Michigan comes in at 33 of the 50 states. While this fact might hurt some feelings, the first step to solving the problem lies in its identification. The individual, family, city, region, state and nation that prepares for this future will prevail, while those that don’t will fail. It is that simple.

OTHER VOICES Tom Watkins

We need to educate far more of our youth to higher and higher levels, to be able to collaborate and compete on the world stage and fill the jobs here at home. We need leaders with the political courage and will to reimagine and redesign education to ensure that all students are prepared for the disruptive world they are inheriting and targeting additional funding, particularly for non-affluent kids across the state. While fixing our “damn roads” is necessary, investing in our education system from the cradle to the grave is mandatory, critical and an urgent issue for our state leaders to address. However, as I lay out in the 2004 report, making additional investment in public education without substantial change in the structure of our schools is folly and unsustainable. These thoughts come flooding back to me as I remember the ideo-

logical battles being fought over several decades all the while we are failing far too many of our children. Reading Patti Poppe’s comments while boarding a flight to return to China to attend a Global Education Summit — the global hub for education thought leadership — the irony was overwhelming. China understands knowledge is power, and they are striving to enhance the educational opportunities for their citizens. We need to be smarter about our educational investments if we don’t want to see China’s continued rise come at the price of our demise. Having a lifelong interest in China and having traveled and worked there over the past three decades, the Chinese understand at the individual, family and government level that those that control knowledge will prevail as the 21st century continues to unfold. They are investing in what will make them strong, while we disinvest in our people. Let me assure you, China is not sitting back waiting for us to get our act together. While our roads need to be fixed, smoothing out the pot holes in our system of education and investing in quality education from pre-K-12, vocational education, community colleges, workforce preparedness, and our university system will be the true legacy of the new leadership that occupy seats of power under the Capitol Dome. Tom Watkins is the China partner and managing director of WAYAmerican Schools and was Michigan’s state superintendent of schools, 2001-05.

Shades of gray on Black Friday L

ast Friday was the traditional “Let’s make a deal” for millions of shoppers in America. The strange thing is that from what I have heard, shoppers are enjoying going back to the stores as well as doing a lot of buying on the internet. Or shopping on the internet and picking things up at stores. Or shopping at stores but having the items shipped to their houses. It would appear that, like all things, Americans like their variety. There’s no longer really a split between bricks-and-mortar and online shopping. Even Amazon is opening stores, because one size does not fit all. For everyone who likes it a certain way, there are a couple of others who want it a different way. It would appear fairly obvious. If you want our business, then be sure and offer us a whole bunch of choices, and reach us where we are. We

KEITH CRAIN Editor-in-chief

like our stores, but we also like the convenience of shopping online, or even that old-fashioned system of picking up the phone and dialing an 800 number. And yes, I would love to know about free delivery. Just about every possible way of shopping will be used and yes, we will switch back and forth as our mood and products change. Black Friday’s main lesson is that Americans love a deal. And to tell you

the truth, we do not care how we get it, whether you called it Green, Yellow or Blue Friday. As long as there is a sale, we will be there, early or late. If you want to make sure that this holiday season is successful, then just do some very smart marketing with presales as well as plenty of after sales. Do not expect it to be business as usual. Change is now business as usual. Happy Black or Blue Friday. The sales season has begun. Let the games begin.

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.

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OTHER VOICES

New clinics pose another threat to primary care By Chris Bush, M.D. he traditional primary care practice is struggling to survive. For years there have been successful attempts to chip away at the patient base of family physicians, general internists and pediatricians. These have included nurse practitioners, drug stores, internet practitioners and specialists who dabble in primary care. The hospital health systems have made concerted efforts through screening clinics, seminars and free services to capture patient activity that has been traditionally provided in primary care offices. Recently Beaumont Health system has announced that it has partnered with WellStreet, an Atlanta-based urgent care corporation, to open 30 urgent care centers in the Detroit area. The announcement states that these clinics will provide quick and easy access for patients and will refer them back to their primary care providers. This venture has far-reaching impli-

TALK ON THE WEB

Re: What does city’s renaissance mean for the RenCen? Why doesn’t the RenCen group get together with the city to create an elevated walkway over Jefferson Avenue, similar to the Pudong district in Shanghai? This would massively help connecting people to the riverfront and the RenCen without having to risk being run over by the 10 lanes of traffic. Fleetwood I’m sorry to say it but the RenCen (and frankly Hart Plaza) was a horrendous project from the day it was built, the product of people who had no idea what makes a city successful. If I were a philanthropist, I would buy and demolish the structure. It’s a wound on the civic body of Detroit. Andrew I walk the RiverWalk about three times a week. I feel that I’m taking my life in my hands every time I cross Jefferson. Basically, you have to contend with traffic speeding on to an entrance ramp and off an exit ramp of the Lodge freeway. Hart Plaza is a disgrace. It was badly designed to begin with has all the charm of a decrepit parking lot (with bunkers). Terrible design all the way around. Pat

Patient–centered medical homes are the sites that provide the highest clinical quality for the best value. cations. Many primary care practices have put considerable effort and expense to become patient-centered medical homes. This innovative concept is based on a close and enduring physician-patient relationship. Several of the tenets of PCMH make urgent

care centers unnecessary. One is 24/7 access to the clinicians through telephone, internet or after-hours visits. The other is that through open scheduling a patient can make a same-day appointment, often within the hour. Patient–centered medical homes in most cases have a lower copay for an office visit compared to the care provided at an urgent care center. Another way of looking at a PCMH office is that they are the sites that provide the highest clinical quality for the best value. The patient-physician relationship offers personal care over the continuum of time. This allows for accurate di-

agnosis and appropriate treatment of acute and chronic problems. In my experience, a patient following up at our office is often not improved and may be worse. The diagnosis is usually wrong and the treatment inappropriate. Many patients are given powerful antibiotics for viral infections. There are many pitfalls when strangers take care of strangers. I would urge Beaumont Health system to reconsider this venture. The system should instead support the patient-centered medical homes that are either part of their system or are their community partners. Patient educa-

tion can be provided to the general population that it is in their best interest to seek out a personal relationship with a physician. We all are aware that newer generations value speed and convenience. They have to be made aware the most important goals should be to receive an accurate diagnosis and proper treatment. Chris Bush, M.D., is a family physician in Riverview in private solo practice and an Authority Health Board member who is active in the Wayne County Medical Society.

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Re: Cellphone carrier plan sparks debate The higher the lease rate, the higher our cellphone bills will be. Let’s not pretend that this cost won’t be baked into our monthly phone bills. Mike Sen. Nofs, you don’t represent the “customers” of Michigan, you represent citizens of Michigan. Or are you trying to reveal something to us here? During each and every one of the senate hearings on this bill, the citizens of Michigan let you know, in no uncertain terms, that we do not want small cell towers with a total of 36 cubic feet in equipment everywhere in our public rights of way. Jeanine

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Many professional fields see suicide rates above the national average By Jay Greene jgreene@crain.com

Each day a physician dies by suicide in the U.S. — a number widely acknowledged as the highest rate of suicide of any profession — and 1.4 times that of the general male population for men physicians and 2.3 times that of the general female population for women physicians. It is possible, say some experts, that overall physician suicide rates are getting close to the national suicide rate of military veterans at 30 per 100,000, which have been treated as an epidemic. The best data on suicide by business professionals, lawyers and doctors comes from a 17-state study the Centers for Disease Control and Prevention conducted in 2016 on suicides by occupations based on 2012 data. So far, it is the only multistate study of its kind. Experts told Crain’s the published CDC data reflects widely held opinions of people in many of the professional fields. The CDC found the highest rates of suicide for people who are manual laborers, construction workers, miners and mechanics, factory and production workers, ranging from 45 to 85 per 100,000, the highest of any occupational category. But professionals come in next, above the average suicide rate for the general population: executives, doctors, nurses, medical support workers, business professionals and lawyers. For example, the suicide rates range from corporate executives and managers at 20 per 100,000, lawyers and health care professionals at 19 per 100,000 to nursing and medical assistants at 15 per 100,000, all of which are over the national rate of 13 per 100,000 in 2016. Some experts said they believe suicide rates of physicians, residents, medical students, lawyers, business executives and other college-educated professionals are increasing faster than the general population. SEE SUICIDES, PAGE 14

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Stigma often prevents doctors themselves from seeking help By Jay Greene jgreene@crain.com

In this package n Many professional fields see suicide rates above the national average. This Page n Stigma often prevents doctors themselves from seeking help. This Page n Vietnam vet turns around life by helping other vets. Page 11 n How Detroit VA is tackling suicide among vets. Page 14

When northern Michigan physician Barrett Zink, 65, died by suicide in August 2017, it was a shock to his family and patients he had treated over his 30-year plus career. Zink had struggled with depression his whole life, a common problem with suicide victims. With Henry Ford Hospital resident Ramesh Kumar, who shot himself at a rest stop outside of Saginaw, there were no warning signs. The 32-yearold Kumar, who friends and family described as outgoing and friendly, was two years away from becoming a practicing physician, a dream he had since fifth grade. Doctors who die by suicide often have untreated or undertreated depression, a fact that underscores the need for early diagnosis and treatment, said Katherine Gold, a family physician at the Depression Center at the University of Michigan and researcher who has published three studies on mental health. The irony? Doctors are often less likely than others to seek that treatment. The most recent meta-analysis study on physician suicide conducted by a Harlem Hospital researcher

in New York showed a rate of 28 to 40 suicides per 100,000, which is higher than the rate among veterans of 30 per 100,000. The study, which was presented this summer as a poster at the American Psychiatric Association, was based on studies published over the past 10 years in various peer-reviewed journals. One of the most cited studies on physician suicide was another meta-analysis published in 2004 by physicians Eva Schernhammer and Graham Colditz. Their analysis showed rates ranging from about 10 to 100 per 100,000 in men and that while female physicians attempt suicide much less often than men, their completion rate is much higher. Female doctors also are 2.3 times more likely to die by suicide than the general female population. “I did a study where I surveyed a group (2,106) of doctor moms on Facebook,” Gold said. “(About 50 percent) were depressed and needed help, but were afraid to seek help because it would be reported to the state medical board” and they feared they could lose their licenses. “Some drove out of state to seek mental health counseling” and others did not seek professional help because they feared stigma that could cost them their jobs or reputations. SEE STIGMA, PAGE 11

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STIGMA FROM PAGE 10

Barb Smith, founder of Barb Smith Suicide Resource & Response Network in Saginaw, said female doctors face additional stressors that helps to explain why female suicide rate for doctors is higher than the general female population. “They are torn between home, family and work pressures,” said Smith, who is working with the Saginaw Medical Society and Central Michigan University School of Medicine to develop physician and medical student wellness programs. “They want to get ahead but the world doesn’t stop and (some) feel hopelessness because they don’t have time to take care of families, themselves, they feel like a burden and have no fear of death.” Gold said there is a need for more studies on physician suicide. But there have been multiple surveys and articles that show that physicians have higher rates of burnout, depressive symptoms and suicide risk than the general population. Residents and medical students also can experience high degrees of mental distress and are less likely than other members of the public to seek mental health treatment. For example, 28 percent of residents experience a major depressive episode during training, compared with 8 percent of similarly aged in-

dividuals in the U.S. general population, one survey showed. “Unfortunately, mental health issues with physicians are underreported and undertreated due to many factors including stigma, shame but more importantly antiquated questions on hospital privileges and state licenses. This latter issue has to be addressed from a policy perspective,” George Kikano, M.D., dean of the College of Medicine at Central Michigan University in Mt. Pleasant, said in an email to Crain’s. Richard Landau, a trial lawyer and licensed psychologist with RJ Landau Partners PLLC in Ann Arbor, said medical students, residents and practicing physicians face immense pressure in a changing health care system that also places doctors in highly stressful and repetitive situations where life and death literally hang in the balance. “Law and medical schools place levels of stress and sleep deprivation that is a type of torture,” said Landau, who also is a clinical psychologist. “(Training) is designed to create people who are stronger, but it also inflicts trauma on people that leads to vulnerabilities.” Gold said one reason physicians don’t seek help is because many doctors worry about confidentiality when it comes to seeking help and how it can affect their jobs. “Medical licensing boards ask

questions about” whether doctors have sought mental health counseling, Gold said. That discourages physicians from seeking help when they face problems. “Michigan is more progressive and doesn’t ask those questions.” Gold said the Federation of State Medical Boards last year passed a

“Unfortunately, mental health issues with physicians are underreported and undertreated due to many factors including stigma, shame but more importantly antiquated questions on hospital privileges and state licenses. ” George Kikano, M.D.

resolution to reduce the stigma of mental health counseling and recommend state boards not ask mental health questions. She said some hospitals, medical schools and professional medical organizations are taking positive steps to help doctors manage stress and burnout. “It (improvement) is mixed,” she

said. “More attention is being paid to work hours by residents and there is more attention to burnout and satisfaction. The job has changed over the years. The family doctor is doing more work at the computer, pushing buttons, and spending less time with patients. There still is a lot of dissatisfaction.” More hospitals need to make mental health support more available in a confidential way, Gold said. For example, hospitals should try and minimize stress in the workplace and modify credentialing applications to avoid discouraging doctors from seeking mental health treatment. Earlier this year, the Michigan State Medical Society passed a resolution to encourage suicide awareness training for doctors and it later was approved at the American Medical Association’s annual meeting. The resolution is also part of a national effort to improve identifying patients with mental health problems, but also encourage doctors to start thinking about how they can help themselves stave off burnout, depression and suicide, Smith said. Smith said the physician stress, burnout, substance abuse and suicide problem in Michigan is very serious and there is little support and time given by themselves and organizations they are affiliated with to get their own needs met. “This leads to burnout, sleep deprivation, hopelessness and suicide,” she said.

The state medical society also has a referral relationship with the Michigan Psychiatric Society for physicians who want to speak with a professional. It also supports Michigan’s Health Professional Recovery Program, a state program that encourages licensed professionals to go through a monitoring program for substance use or mental health disorders. After Kumar’s suicide last year, Lisa MacLean, director of the physician wellness program at Henry Ford Health System, said the Detroit-based system expanded its resident and fellows wellness program to all physicians and is encouraging all doctors to recognize stress, burnout and suicide warning signs of their peers. For example, if there is behavioral incident, a medical team huddles to discuss what led to the stressful situation, how to prevent it next time and provide emotional support. “There have been reporting, referrals, calls from a residency director about a change in behavior in a person and that is reported to the physician employee assistant program,” MacLean said. “We need to decrease the stigma so people receive the care they need,” she said. “We have created a policy to give residents time to get preventive medicine. They get two full days off to see a psychiatrist, get mental health counseling. We are getting reports they are using it.”

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SPECIAL REPORT: HEALTH CARE Trained and licensed also as a clinSUICIDES ical psychologist, Landau has studied FROM PAGE 10

“There is a (mental health) crisis here that is being exacerbated by how professions conduct themselves and how lawyers, doctors and business executives adapt to professional life,” said Richard Landau, a trial lawyer and clinical psychologist with RJ Landau Partners PLLC in Ann Arbor.

Melissa Bowman: Speaking more with medical students.

Rising incidence

Nicole Stromberg: Veterans struggle with adjustment issues.

“Employers who see the link between depression causing problems, affecting performance (and) lost workdays and implement programs can begin to see employee improvements, and return-oninvestment in just four to six weeks.”

Michigan’s suicide rate has increased by 33 percent since 1999, faster than the 24 percent national increase during that time. Suicide is now the 10th-leading cause of death in Michigan and the nation. With a string of recent celebrity suicides, including Kate Spade, Anthony Bourdain, Robin Williams, Hunter S. Thompson and Chris Cornell, the rock musician who took his own life in Detroit last year, the public takes more notice. Several notable cases in Michigan also have been widely reported the past several years. They include the 2001 suicide of automotive company CEO Heinz Prechter, who founded American Sunroof in 1965; the 2010 death of David Widlak, a banker who was highly suspected of taking his own life by a gunshot to the head; and the 2012 death of Fox 2 Executive Jeff Murri. In 2017, there also was the suicide death of physician Barrett Zink of Charlotte, and Henry Ford Hospital urology resident Ramesh Kumar.

Jodi Jacobson Frey

Landau said he believes suicide rates in the professions will continue to increase until more law firms, hospitals, accounting firms and corporations acknowledge their business models have deadly side effects to their employees and take serious steps to address the problem.

suicides in professions that have demanding workloads and high expectations for positive results and success. “When you look at suicide, it is culmination of a process,” he said. “People don’t just jump to the conclusion they want to kill themselves. It often is a mental illness, compromised by depression, hopelessness, with substance abuse or alcohol use making it worse. It also begins much earlier in life.” Landau said for every person who completes suicide, another two dozen or so attempt it. Besides increasing suicide rates in the professions, there has been a corresponding increase in untreated depression, burnout and addiction, he said. “Institutions have become highly depersonalized. They are now highly profit-seeking entities that amalgamate people in large numbers,” Landau said. “Medicine and the law, accounting and financial services, they all have adopted the model of large corporations in America that are profit-oriented to their shareholders.” Landau said companies want workers to be “productive, efficient and don’t complain.” He said doctors, lawyers and businesspeople have stressful work lives and employers have high expectations. “The added stress takes its toll on people, especially those who don’t have outlets and have underlying mental health problems,” said Landau. Doctors are a prime example.

The Michigan State Medical Society in a statement to Crain’s cited a long list of stressors for physicians, including “insurance and payer restrictions, unsupportive leadership, changing technology such as electronic health records and the regulatory burden of government, payer and medical oversight bodies.” High patient workloads and hours, employer’s financial incentives, medicine’s culture of competition and philosophy of work-despite-exhaustion put additional pressure on doctors. Lisa MacLean, M.D., a psychiatrist hired by Henry Ford Health System two months before the death of resident Kumar, said suicide in the medical profession has reached epidemic proportions. “I started in March 2017 and we lost Dr. Kumar in May,” said MacLean, who also is director of the system’s newly implemented physician wellness program. “The concern about physician wellness is a national concern.” In cases where physicians died by suicide, depression is found to be a significant risk factor leading to their deaths. But those physicians were less likely to be receiving mental health treatment compared with nonphysicians who took their lives, said MSMS.

Taking action Last year, the Accreditation Council for Graduate Medical Education, which accredits Henry Ford’s residency program and thousands of others in the U.S. and Michigan, mandated that programs develop a

resident and physician wellness program and policies. “The ACGME recognizes that when a resident comes into a program something happens. They are more depressed and more anxious when they leave.” MacLean said ACGME and Henry Ford decided to expand the program for all physicians. In 2001, Henry Ford also began a larger program on burnout and job stress that has led to a national movement. “We have moved to invest in a physician employee assistance program (executive), not just in response to Dr. Kumar, which is a tragic event, but we don’t want any more tragic events,” MacLean said. Some companies like DuPont and Caterpillar also have recognized that middle-aged male suicide is increasing, possibly faster than national rates, and have adopted employee and executive wellness programs to address burnout and suicide rates, said Jodi Jacobson Frey, an associate professor in the school of social work at the University of Maryland in Baltimore. “Fortune 100 companies are embracing the idea that a well-adjusted workforce contributes to productivity, compared with just thinking about performance,” said Frey, adding more companies are taking a longer-term look at their workforces, including measuring the costs of hiring replacement workers and training costs versus adding wellness programs that include mental health services. “Employers who see the link between depression causing problems, affecting performance (and) lost workdays and implement programs can begin to see employee improvements, and return-on-investment in just four to six weeks,” Frey said.

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Nationally, suicide rates have been increasing the past 19 years in almost every state, including Michigan, and across demographic and age lines, the CDC said. Michigan’s suicide rate, at 13.3 per 100,000 in 2016, ranks 34th-highest in the nation. But because of combined suicide deaths, which include deaths from misuse of drugs like opioids or alcohol, Michigan’s numbers are projected to continue to increase to as many as 65 per 100,000 by 2025, according to the “Pain in the Nation” report by Trust for America’s Health. The report said Michigan’s combined death rate was 45 per 100,000 in 2015. “When you look at overdose and opioid deaths, you can’t say for sure it was suicide, intentional or accident,” said Melissa Tolstyka, director of programs with Livonia-based Hegira Health. Hegira, a behavioral health provider, is one of a number of organizations in Michigan in the early stages of implementing a “zero suicide” program in its intervention and treatment approach with patients. “Our data used to show alcohol (addicts) as our primary population (8,000 total clients), but that has changed to opioids. We look at suicide risks differently now.” Tolstyka said the seven-step model to reduce suicides in Hegira’s patient population will be rolled out over the next two years. She said the agency decided to change its approach using the zero suicide model because of the increasing rates of suicide. SEE SUICIDES, PAGE 15

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How the Detroit VA is tackling suicide among veterans By Jay Greene jgreene@crain.com

Michigan’s veteran suicide rate has been dropping the past several years to 26 per 100,000 in 2016 from 36 per 100,000 in 2014. Nationally, the veteran suicide rate is down to 30 per 100,000 in 2016 from 38 in 2014. Nicole Stromberg, mental health chief at the John D. Dingell VA Medical Center in Detroit, said she believes those numbers at the Detroit VA have dropped further in 2018. “We are embarking on the largest public health initiative in the history of health care,” said Stromberg, a

psychiatrist and neurologist who explained that national protocols and policies have been developed in the U.S. and abroad to use the same screening tools and evidenced-based treatments to reduce suicide rates. Stromberg said veterans are now assessed for suicide risk by all primary care providers, not just psychiatrists and mental health professionals. “There is a stigma around people asking (about suicide). It doesn’t put the idea into people’s minds. Quite the reverse, people feel relieved” they are asked about it, she said. Expanding the risk evaluations,

Stromberg said veterans will be screened more closely if they access emergency services regularly, don’t sleep well, have chronic pain or are in end-of-life care, geriatrics and rehabilitation services. Stromberg said another reason for success in Detroit has been the increase in those employed in mental health services. Detroit VA has hired more than 30 professionals the past 16 months to more than 178 non-nursing mental health employees, she said. In 2018, Detroit VA provided mental health services to 13,000 veterans,

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a 3 percent increase from the same period in 2017, she said. “This increase is even with people moving away and outside of our care,” she said, adding that VA ensures they are followed up wherever they move. Stromberg said Detroit VA is partnering with many community organizations, governmental bodies and universities, including Team Wellness Center, Wayne County, Henry Ford, Wayne State University and the city of Detroit through a VA partnership program called the “Mayor’s Challenge.” Twenty-five cities, including De-

troit, are participating in the challenge, which is designed to create regional teams of community partners to eliminate suicide by using a comprehensive public health approach to prevention. Of the 20 veteran suicides a day, an average of 14 were not under VA care. “We are trying to figure out where the gaps are, how to reach veterans that none of the partners are reaching and to develop” programs for them to access mental health services, said Detroit VA spokesman Alysse Mengasen.

health counseling is setting personal goals about their futures. “It is important for them to reconnect with family, resolving criminal justice issues, finding a job, earning money, saving for something important,” said Stromberg, adding that the VA has vocational specialists to help veterans when they are ready.

“My own experience, one of the things I have seen is we have gone from bedside manners, where we listen to people for the time we felt we needed to with just pencil and paper and just talked,” Thomas said. “You really work with them. We can’t do that in 15 minutes” that professionals are expected to do today. Carmen Serpa, a psychiatrist and medical director at Common Ground, said physicians have become “prescription machines” instead of hands-on healers because of the corporatization of medicine and the increasing patient load. “Suicide has gone up (among physicians and) for residents as well,” Serpa said. “Lawyers come in with levels of stress they didn’t have before. We live in a high-pressure environment where we are expected to perform. You either get meds, get help, or get out.” Bowman said in the past year she has spoken with more medical students on the crisis line who call during their rotations. “Doctors who have patients in their offices call us because their patient has suicide” thoughts, she said. “They call us for help because they have not been taught or trained” to deal with a mental health crisis. Another problem for top managers or CEOs is they say they cannot get counseling through their own employee assistance program because of their status in the company, Bowman said. “It might show up in insurance or their EAP program, and the stigma” is too much for them to risk, she said. In a CDC-funded study on Michigan, Frey is in the second year of a study focused on reducing suicide ideation and behavior among working-age men, including those in a variety of professions. “There is a myth that when you have a job, you should be able to handle a life crisis. There have been increases in suicides of middle-aged adults without any comparable attention on prevention,” Frey said. “This includes men in health care professions, doctors and those who work in mental health fields.” Frey said isolation is a major factor in stress, burnout, depression and suicide. She said high-level business executives have fewer social circles at the workplace to form trusting relationships. “This is a major risk factor for suicide,” she said. “There is a lot of stress people face and they might go home, but they really can’t talk about it, which increases social isolation.”

Business professionals

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SUICIDES FROM PAGE 14

“We operate comprehensive crisis services for adults in Wayne County and the majority of people coming in with emergency psychiatric services have multiple factors impacting the risk for suicide,” Tolstyka said. Tolstyka said Hegira has started to make changes now including using the Columbia-Suicide Rating Scale in its screening and risk assessment process to help determine who may be at a moderate to high risk. They then follow a care pathway with treatment. “Thanks to (Detroit-based) Flinn Foundation, we will be able to train staff on evidence-based practice for suicide prevention, and that will be included in treatment,” she said. “We all need to take a proactive approach to reduce the numbers of individuals completing suicide,”

Tolstyka said. Several other organizations in Southeast Michigan also have adopted the “zero suicide” approach within their own organizations, including Oakland Community Health Network and Henry Ford, one of the national leaders in the movement.

Physician suicides Increasingly, suicide is being viewed not only as a mental health problem but a public health one. Nearly 45,000 suicides occurred in the United States in 2016 — more than twice the number of homicides. The most common method used across all groups was firearms at 51 percent. But the other two leading methods include suffocation or hanging (25 percent) and poisoning or overdose (17 percent). Because guns are used in nearly half of all suicides, the states with the lowest suicide rates have stricter gun

laws. Those states include New Jersey, New York, Massachusetts, Maryland and Connecticut, all between 7 and 10 per 100,000 suicides. Michigan and Florida, which have more relaxed gun laws, have higher rates, at 13 and 14 per 100,000, respectively. Nicole Stromberg, mental health chief at the John D. Dingell VA Medical Center in Detroit, said the VA doesn’t track veteran suicides or attempts by occupation because the vast majority of those at risk are unemployed. All seven veterans under care by the Detroit VA who committed suicide last year were unemployed, she said. “They were struggling with more chronic adjustment and psychiatric issues,” she said. “They didn’t have a lot of balance (and had feelings of) isolation and depression. They also had easy access to easy means, which are firearms.” Stromberg said a key goal of mental

It can be challenging to study suicide among people in high-profile positions. When business executives die, especially C-level executives, or celebrities and other highly educated professionals, there is little data to understand differences in those populations and others, said Brian Ahmedani, director of research for Henry Ford’s behavioral health services department. “The challenge on doing suicide prevention research is you need huge populations to understand the risk factors,” said Ahmedani, who has been a primary investigator for several local and national suicide research projects. “What are the reasons corporate executives die from suicide? There are only so many corporate executives. ... There is not enough research on the field to get answers.” Ahmedani said business professionals develop stress over time with financial decisions that may determine whether a company succeeds or fails. When they fail and a company goes under, people lose their jobs and “there is always somebody who has to take it for the team. You can’t fire the entire company workforce.” Melissa Bowman, suicide presentation coordinator at Common Ground in Pontiac, said she has spoken with a number of professionals, including doctors, medical students, residents, lawyers and business executives, who have called the agency’s crisis line. “It all falls under the category of stress ...” Bowman said. “They have a sense of helplessness or hopelessness, an inability to do self-care. They have a higher stigma for receiving mental health services that is blocking them from getting help.” In addition, as usually the major income earners for their families, stress builds up more severely for some professionals, Bowman said. “They aren’t always the most resilient to stressors.” Rosa Thomas, Common Ground’s vice president for programs and services, said the faster pace of business, health care and even the mental health field creates internal stresses on people who work in those systems.

Jay Greene: (313) 446-0325 Twitter: @jaybgreene

C R A I N ’ S D E T R O I T B U S I N E S S // N O V E M B E R 2 6 , 2 0 1 8

DEALS & DETAILS MERGERS & ACQUISITIONS J Southfield-based insurance company AmeriTrust Group Inc.’s retail agency subsidiary Meadowbrook Insurance Agency has acquired Carol P. Rummel Insurance Agency dba Signature Insurance Agency, Sarasota, Fla. Website: ameritrustgroup.com J Inbound Lead Solutions, Detroit, a marketing firm, is merging with Pitchnoise Strategic Communications, Detroit, a communications firm. Websites: pitchnoise.com, inboundleadsolutions.com J LTC Global Inc., Fort Myers, Fla., an insurance company, acquired A. M. Levin Insurance Associates Inc., doing business as Financial Advisory Associates, Southfield, a life insurance agent and member of Capitas Financial Inc. Websites: ltcglobal.com, capitasfinancial.com J J & B Medical Supply, Wixom, a medical supply store, acquired a majority ownership of the Sylaps Inc. platform, San Francisco, Calif., a video conferencing service web app that provides video or audio calls, chat and file sharing between individuals or groups. Websites: jandbmedical.com, sylaps.com

CONTRACTS J Gale Group Inc., Farmington Hills, part of Cengage Learning Inc. and a publisher of research and reference resources, has a partnership with the American Antiquarian Society,

Worcester, Mass., a national research library of American history and culture through 1876, to make a collection of Americana from the Colonial period through the 20th century more accessible to researchers. As part of the partnership, Gale has released American historical periodicals from the American Antiquarian Society, Series 6, a newly digitized series of nearly 200 titles that provides researchers with a history of the American people, offering multiple perspectives on the thought, culture and society of North America through the eyes of those who lived and experienced it. Also, Gale has a partnership with the Royal Collection Trust, London, United Kingdom, manager of the royal collection, to release the digital version of the Stuart and Cumberland papers that provide insight into the social, military and personal worlds of the exiled Stuart dynasty between the late 17th and early 19th centuries. Websites: gale.com, americanantiquarian.org, rct.uk J G2 Consulting Group LLC, Troy, a construction engineering firm, was selected by the Road Commission of Oakland County as a potential geotechnical design partner on construction projects for 2019-2021. Website: G2consultinggroup.com J Realcomp II Ltd., Farmington Hills, a real estate listing and data service, has signed a multi-year license with Remine LLC, Fairfax, Va., a software company, to provide tax data in Michigan as part of the RCO3 real estate software system. Websites: remine.

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SPOTLIGHT com, realcomp.moveinmichigan.com J Valassis Digital, Livonia, a digital marketing company, has a contract with Allant Group LLC, Downers Grove, Ill., an analytics and marketing firm, to provide marketers with information about customers and reach those with similar behavior and traits. Websites: valassis.com, allantgroup. com J The Hardenbergh Group, Livonia, a temporary agency; National Government Services, Indianapolis, Ind., a health information technology and administrative services provider; Spectrum Health Inc., Grand Rapids, a health system; WellCare Health Plans Inc., Tampa, Fla., a managed care services provider, and Accenture LLP, Dublin, Ireland, a management consultant, are participating in Nashville, Tenn.-based ProCredEx LLC’s Professional Credentials Exchange, a ledger program aimed at resolving the administrative inefficiencies related to professional credentialing. Websites: hardenberghgroup.com, ngsservices.com, spectrumhealth.org, wellcare.com, accenture.com, procredex.com J BullsEye Telecom Inc., Southfield, a telecommunications company, has been selected by Beaumont Health, Royal Oak, a health care system, to be a provider of telecommunications services. Websites: beaumont.org, bullseyetelecom.com J HoMedics Inc., Commerce Township, maker of health and wellness products, and Bluestar Alliance LLC, New York, N.Y., a fashion designer, have signed a $165 million, five-year license agreement under the Brookstone brand for massage, massage chair, home environment and other products. Websites: homedics.com, bluestaralliance.com J Near Perfect Media, Bloomfield Hills, a public relations firm, has been named the agency of record for DiMaggio Fine Art & Jewelry, Lathrup Village; Healthclarity, Madeira Beach, Fla. and Mootz Pizzeria & Bar, Detroit. Website: www.nearperfectmedia.com J FEV, Auburn Hills, an engineering services provider, and Metamoto Inc., Redwood City, Calif., an autonomous vehicle simulation solution provider, have an agreement under which FEV will provide technical expertise and support to users of Metamoto’s autonomous vehicle simulation platform, Simulation as a Service. Websites: fev. com, metamoto.com J Infax Inc., Atlanta, an information technology provider for airports and other public venues, launched its Trax SmartRestroom facility analytics system at Detroit Metropolitan Airport’s McNamara Terminal, Romulus, a Delta Air Lines hub. The system monitors monitors restroom traffic flow, sends real-time data alerts to staff, and allows travelers to report any issues. Websites: infax.com, metroairport.com J The Center for Orthopedic Research and Education, The CORE Institute, Phoenix, Ariz., orthopedic surgeons and neurologists, has an agreement with Legacy Center, Brighton, a multi-sport facility, to deliver onsite medical coverage, medical care to athletes and education to staff and athletes. Websites: thecoreinstitute. com, LegacyCenterMichigan.com J O2 Investment Partners, Bloomfield Hills, a private equity firm, has invested in Vessco Inc., Chanhassen, Minn., a water treatment company serving municipal and industrial mar-

kets. Websites: o2investment.com, vessco.com

EXPANSIONS J Visteon Corp., Van Buren Township, an auto parts supplier, opened a technology center in Karlsruhe, Germany, which will develop vehicle cockpit electronics, including information display, driver assistance, cockpit domain controller and autonomous driving technologies. Website: visteon.com

NEW SERVICES J Pyramid Solutions Inc., Bingham Farms, a computer consultant, released a new version of Life Underwriting Solution software to include cognitive capture and advanced analytics capabilities. Website: PyramidSolutions.com J Property Damage Appraisers Inc., Fort Worth, Texas, a damage appraisal firm, now offers same-day and nextday damage estimates in metro Detroit. Website: pdacorporation.com J Sechrist Industries Inc., Anaheim, Calif., a medical equipment manufacturer, installed the first veterinary hyperbaric oxygen chamber in Michigan at Woodhaven Animal Hospital, Woodhaven, a veterinary hospital, allowing the hospital to offer free sessions to animals suffering from smoke inhalation as a result of house fires. Websites: sechristusa.com, woodhavenanimalhospital.com J WOW air, Reykjavik, Iceland, an airline, has reinstated seasonal service to Tel Aviv’s Ben Gurion Airport via Iceland’s Keflavík International Airport, from several U.S. airports including Detroit Metropolitan Airport, Romulus, starting June 10, 2019. Other cities include: New York, Boston, Washington, D.C./Baltimore, Chicago, San Francisco and Los Angeles. Website: wowair.us J Detroit’s 36th District Court has joined the DivDat Kiosk Network, Diversified Data & Communications Inc., Ferndale, to allow individuals to pay court fees and fines on 50 kiosks without having to travel to the downtown courthouse. Website: divdat. com, 36thdistrictcourt.org J Berry Moorman PC, Detroit, a law firm, launched a redesigned website, berrymoorman.com J MedCerts, Livonia, an online health care and IT certification provider, has a partnership with VetBloom, Woburn, Mass., provider of online veterinary courses and continuing education, to offer an online veterinary assistant program. Websites: medcerts.com, vetbloom.com J Uru Sports, Ann Arbor, a field hockey connection platform, released membership programs and features for athletes and teams, connecting field hockey players and teams at clubs and universities through an athlete and roster search engine and a social network. Website: urusports.co J ProQuest, Ann Arbor, launched Idea Exchange, an online community for library customer ideas, for libraries that use the Oasis or LibCentral services. Also, ProQuest is partnering with 10 universities to develop the Rialto service to unify selection and acquisition in academic libraries. Website: proquest.com

Submit Deals & Details items to cdbdepartments@crain.com

Michigan health association sees leadership changes

The Michigan Health & Hospital Association will see some top leadership changes come Jan. 1. David Seaman will retire after 33 years with the Okemos-based association as executive vice president and COO, where he led the association’s advocaSeaman cy and policy divisions and oversaw its operational divisions, MHA said in a news release. Seaman has also served as the longtime MHA board of trustees staff secretary. Chris Mitchell will be promoted from senior vice president, advocacy, to executive vice president, advocacy and public affairs, MHA said. Mitchell joined the association in 2006 as a fellow, serving as a lobbyist for the hospital community and for the last two years leading the association’s advocacy division. Nancy McKeague, senior vice president and chief of staff, has been named COO, and will oversee human resources, IT, graphic services and accounting and finance. Adam Carlson will join the advocacy team effective Nov. 20 as senior director, government and political affairs. Carlson joins the MHA from the State Budget Office, where he served as senior adviser since January 2017. Carlson has also worked as a legislative director and senior budget adviser for the appropriations chair in the Michigan House of Representatives. Amy Barkholz, MHA general counsel, will assume Seaman’s board of trustees staff secretary duties.

Ruth Mott Foundation promotes Thueme

The Ruth Mott Foundation has promoted Raquel Thueme to president, the Flint-based organization announced last week. Thueme, 56, succeeds Handy Lindsey Jr., who retired Nov. 2 after serving as president for four years, according to a Thueme news release. Most recently, Thueme served as the organization’s vice president of programs where she played a critical role in engaging the community on the foundation’s activities and priority areas in 2015-16 when it tweaked its strategy to focus on north of Flint, the release said. In her new post, Thueme will manage community programs at Applewood, the estate of automotive pioneer Charles Stewart Mott, which the Ruth Mott Foundation owns and where the organization operates a point of community outreach and learning.

C R A I N ’ S D E T R O I T B U S I N E S S // N O V E M B E R 2 6 , 2 0 1 8

CALENDAR MONDAY, NOV. 26 Translating the Trade Situation: Tariffs, NAFTA 2.0 and What It All Means. 5-7:30 p.m. Turnaround Management Association. The dynamics of trade are changing rapidly. What are the implications for business? How are companies dealing with these new realities? What could they mean for business in the future? Moderator: Tracy Arceci, senior vice president, Bank of America Business Capital, Bank of America Merril Lynch. Panelists: Jeoff Burris, Advance Purchasing Dynamics; Stephen Tapley, AlixPartners and Rick Walawender, Miller, Canfield, Paddock and Stone. Dickinson Wright, Detroit. $30 members; $50 nonmembers. Contact: Mary Anne LaMarre, email: Detroit@ turnaround.org; phone: (313) 9105066.

WEDNESDAY, NOV. 28 UHY LLP Annual Construction Update. 7-11:45 a.m. A tax reform update, a look at opportunity zone funds and a construction outlook. Speakers include: Diane Menzo, accounting manager, Flagstar Bank; John Gallo, principal, Tax, UHY LLP; Gina Staudacher, partner, Howard and Howard Attorneys; Mary LeFevre, regional director of business development, The Christman Co.; Anthony Bango, vice president of project planning, The Christman Co. and Jim Like, vice president, Christman Constructors Inc. Detroit Athletic Club. Free. Contact: Jessica Labut, email: jlabut@uhy-us. com; phone: (586) 843-2507. Franchising as a Career, an Investment, or Both. 5:30-7:30 p.m. Includes franchising basics, the array of categories and investment levels available, how to match vision with viable choices and conducting proper due diligence. Speaker: Mark Cory, owner of FranNet Michigan. Law Offices of Jaffe Raitt Heuer & Weiss, Southfield. Free; registration required. Contact: Mark Cory, email: mcory@ frannet.com; phone: (313) 821-5060.

THURSDAY, NOV. 29 31st Annual Butzel Long Labor, Employment, Benefits and Immigration Law Forum. 7 a.m.-3 p.m. Presenters: Attorneys practicing in Butzel Long’s labor, employment, benefits and immigration law areas. Investigations in the Age of #MeToo special keynote speaker: Barbara McQuade, former United McQuade States Attorney for the Eastern District of Michigan, University of Michigan law professor and MSNBC legal analyst. Workshop topics include: retention and transition strategies; employee benefits; topics in business immigration law; understanding wage and equal pay issues; arbitration vs. litigation; the National Labor Relations Act; the FMLA; employer immigration compliance and worksite enforcement; dealing with a mentally and emotionally challenged employee; workplace investigations; protecting trade secrets and effective noncompete agreements and service/

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emotional support animals and other ADA accommodation issues. MotorCity Casino Hotel Detroit. $190. Contact: Nairi Bagdasarian, email: bagdasarian@butzel.com; phone: (313) 225-7012.

UPCOMING EVENTS 2018-2019 State of the Region. 11 a.m.-1 p.m. Dec. 4. Detroit Regional Chamber. The chamber will release its annual State of the Region report, providing an economic overview of the 11-county region and benchmarks against peer regions. Learn where the region stands in per capita income growth, unemployment, median home values, talent, innovation and foreign direct investment. Ford Field. $65 members; $120 nonmembers. After Nov. 27,$75 members; $130 nonmembers. Contact: Jordan Yagiela, phone: (313) 596-0384; email: jyagiela@detroitchamber.com Market Research Basics. 9-11:30 a.m. Dec. 5. Oakland County One Stop Shop. Workshop helps find customers, identify competitors, perform competitive analysis, identify new site locations, target direct mail campaigns, reveal untapped markets and expand to new and appropriate markets. Oakland County Executive Building Waterford Township. Free; registration required. Contact: Oakland County One Stop Shop, email: smallbusiness@oakgov.com; phone: (248) 858-0783. Toyota In Transition: Maintaining Momentum in the Age of Mobility. 11:30 a.m.-1:30 p.m. Dec. 5. Detroit Economic Club. Jim Lentz, CEO, Toyota Motor North America, will discuss how Toyota is managing the balance of present and promise. Moderator: John McElroy of Autoline Detroit. Westin Lentz Book Cadillac. $45 members, $55 guests of members. Website: econclub.org Fireside Chat with Ramzi Hermiz. 5-8 p.m. Dec. 6. Marketing and Sales Executives of Detroit. Q&A with automotive supplier Shiloh Industries CEO Ramzi Hermiz. Craft Breww City, Farmington Hills. $100 current MSED members; $125 nonmembers. Phone (248) 643-6540. Website: msedetroit.org 2019 Michigan Economic Outlook. 11:30 a.m.-1:30 p.m. Jan. 8. Detroit Economic Club. Speakers include: Kevin Johnson, president and CEO, Detroit Economic Growth Corp., and Jeff Mason, CEO, Michigan Economic Development Corp. MotorCity Casino Hotel. $45 members, $55 guests of members. Website: econclub.org To submit calendar items visit crainsdetroit.com and click “Events” near the top of the home page. Then, click “Submit Your Events” from the drop-down menu that will appear. Fill out the submission form, then click “Submit event” at the bottom of the page. More Calendar items can be found at crainsdetroit.com/events.

To place your listing, contact Kate Rozek at 313-446-6086 or email krozek@crain.com www.crainsdetroit.com/classifieds RESIDENTIAL PROPERTY

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BLUE CROSS

and not everybody has the same desire to work in an office setting. “Our pilot had strong satisfaction with the workforce. ... We need to make sure productivity remains the same or increase. We have high standards around compliance,” said Keith, adding that over the next year it will be expanded division by division to include pharmacy and health care value. “When we get to the end of 2019, we will have a very good idea how it will work for us,” she said. In 2011, Blue Cross moved about 3,000 workers from its Southfield offic-

Tune in to WJR 760 AM for Caring for Kids, a monthly radio program highlighting issues and efforts locally, regionally and nationally, that impact the health of children in our area.

es into the RenCen Towers 500 and 600. The move was projected to save the nonprofit health insurer $40 million over 15 years. Blue Cross has 9,008 employees in Michigan for Blue Cross and its subsidiaries, and 10,236 employees nationally. But two Blue Cross insider sources told Crain’s the move downtown has been costlier than expected and has led to dissatisfaction among some employees because of the additional travel time to work and associated costs. Helen Stojic, Blue Cross’ director of corporate affairs, said in an email that BlueSpace “positions us as a company that responds to employee needs, approaches change deliberately but gradually, and one that is moving to be more nimble and efficient while attracting millennial talent.” Data show that companies seeking to hire millennials are finding they appreciate the value of flexible work locations. The 2017 Deloitte Millennial Survey found 64 percent of millennials favored telecommuting, up 21 percent from 2016.

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Telecommuting trending

FROM PAGE 1

While two Blue Cross sources told Crain’s that Loepp cited cost savings as one benefit and reason to expand the program, Keith said BlueSpace was initiated solely as a employee retention and job satisfaction project. She said there will be administrative cost savings in various areas, but declined to provide projections. Keith said Blue Cross has multiple generations of people in its workforce

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Telecommuting has become a popular option that employers have been ramping up as technology has matured. Benefits include improved productivity, greater job satisfaction and cost savings for employees and employers, according to various studies. More than two-thirds of people around the world work away from the office at least once every week and 53 percent work remotely for at least half the week, according to a survey by IWG, a Swiss serviced office provider, of 96 international companies and 18,000 professionals. Matt Piszczek, an associate professor of management at the Mike Ilitch School of Business at Wayne State University in Detroit, said a growing number of companies are adding telecommuting work programs to their benefit programs mainly as a recruiting and retention strategy. He said there can be cost savings, depending on the real estate required. “As the economy picks up, it gets harder and harder to recruit workers, and these flexible benefits are important to retain talented workers,” Piszczek said. “As technology improves, it becomes more plausible for companies and telecommuting gets easier and easier.” Gongos Inc., a Royal Oak-based decision intelligence support company with 145 employees, allows all employees with more than one year at the company to work at least one day a week from home. The company feels it adds to employee job satisfaction, recruiting and retention. Twenty-two employees, or 15 percent of the workforce, work full time at home, said Cheryl Halverson, vice president of people development and people planning, who was the first fulltime telecommuter when the program began 20 years ago. In 2011, Gongos began to offer a telework program to all employees, allowing them to work at home a maximum of one day per week. Employees can choose any day to work from home except Fridays, she said. “Our employees love it. We have high satisfaction. It is one of the top three things they love about working here,” Halverson said. “We have a super collaborative (work culture) and high expectations.” For example, regardless of where an employee is working, Halverson said the expectation is that the work product will be the same or better. “If we have a videoconference, or one-one-

one call, they are on the video conference. People can see us on the screen,” she said. While the company hasn’t conducted a formal study of the results of the telework program, Halverson said the general belief is workers are more productive at home because there are fewer interruptions and distractions. There are rules for working at home, including having a dedicated workspace, using videoconferencing and working regular business hours.

Potential pitfalls In Crain’s 2018 Cool Places to Work, 74 of 100 companies, including Gongos, offer employees a variety of telecommuting options. Other large national compa- Halverson: Exec nies with tele- telecommutes commuting pro- herself grams include Troy-based Kelly Services, Amazon, Humana, Dell, Anthem and United Healthcare. While many companies report success with telecommuting programs, Yahoo and Best Buy eliminated their work-from-home programs in 2013 and IBM in 2017 because they did not achieve the positive financial results the companies wanted. IBM and the other companies have said in statements they believe having more people working in the office will increase collaboration and innovation and accelerate the pace of work. But Piszczek said studies of such large companies that used telecommuting practices showed improved productivity and lowered turnover. “Broad policies like these require a certain culture to be successful,” he said. “Best Buy got a new CEO and Yahoo quickly decided the program was not a good match for their culture.” Other large companies such as Bank of America and Aetna also have reduced the size of their telecommuting programs. Experts say it remains to be seen whether larger companies that remove an employee benefit like telecommuting will fare better financially, especially as more smaller competitors add the benefit programs. As a result, data from the Bureau of Labor Statistics American Time Use Survey shows that the number of U.S. workers who worked partially or fully from home dropped to 22 percent in 2016 from 24 percent in 2015. Still, Piszczek said many companies, including the larger ones, allow telecommuting to be negotiated informally between an employee and manager to ensure that workflow is not disrupted. Telecommuters are often those who have a good track record as a traditional employee rather than the people who might need to work from home due to other life demands, he said. Piszczek said not all jobs can be done at home. “You are not going to put a production line job at home.”

Lowering costs Two inside sources said Loepp told the board that BlueSpace has been so successful that he authorized the program be accelerated. Aside from the employee benefit advantages, the sources said Loepp believes there can be cost savings down the road with fewer in-house workers, lower turnover and job recruiting costs and that can contribute to the Blues’ effort to reduce administrative costs, which are

higher than competitors’. Citing proprietary discussions with the board, Keith and Stojic declined to comment on what Loepp might have told the board and senior management. Loepp and other senior Blue Cross officials are concerned that cost-cutting has not sufficiently reduced administrative overhead percentages, sources said. In early 2016, Blue Cross embarked on a cost reduction program called strategic business transformation to cut $300 million in administrative costs out of its $27 billion budget. Crain’s obtained a report in 2015 that demonstrated that Blue Cross’ administrative expenses were higher than competing health insurers, placing it at a competitive disadvantage. One Blue Cross insider read to Crain’s an internal report that concluded that while the company hit its overall cost reduction targets from 20162018, its administrative cost ratios remain high. The report indicated costs are still too high compared with smaller rivals like Priority Health, Health Alliance Plan and Aetna. However, the second Blue Cross insider said large employers, despite demanding lower health care costs and greater pricing transparency, are hesitant to switch insurers because Blue Cross prices are still much lower than other insurers because of the provider discounts the massive insurer can command. Piszczek said most employers don’t view telecommuting as a cost saving program, per se, although there can be savings on office space, parking, electricity, water, supplies and savings also associated with reduced turnover if employees see the program as a plus. However, one study showed that employers who offer at least part-time telecommuting saved $44 billion per year, or $11,000 per half-time telecommuter, according to Flexjobs. com. While the two sources did not know how much BlueSpace would save Blue Cross, they said there has been talk by top managers that Blue Cross could reduce its footprint at the RenCen over time to achieve greater savings. Keith said there are no plans to restructure the lease at the RenCen. A GM spokesman said the company is unaware of any office changes planned by Blue Cross. But Keith said depending how BlueSpace rolls out, there may be a need to move desks and offices around. “It has some real estate impact,” she said. One of the Blue Cross sources told Crain’s that the BlueSpace program has made some areas in the RenCen’s 500 tower look “like a ghost town” during some parts of the week. The source said Blue Cross executives have told staff they expect to eventually save administrative money with the telecommuting program. So far with the telecommuting program, Blue Cross has not reduced parking spaces at the RenCen. Blue Cross rents about 2,500 spaces at the RenCen for about $1.77 million annually, according to an internal report. Overall, Blue Cross spends about $9.4 million annually on rent, parking and other expenses at the RenCen. “We hope to see savings from less turnover and greater productivity,” Stojic said in an email. “Interestingly, the pilot generated savings from reduced printing costs as mobile employees were printing less and using more electronic options.” Jay Greene: (313) 446-0325 Twitter: @jaybgreene

C R A I N ’ S D E T R O I T B U S I N E S S // N O V E M B E R 2 6 , 2 0 1 8

BUSCHE FROM PAGE 3

As Perkins was gathering the requisite work experience to warrant the top position, Busche was also evolving. Under its founder, the company continued to grow as competitors struggled. Southfield-based Chassix Inc. crumbled under a significant debt load and poor plant performance under former owners Platinum Equity, the private entity company of Detroit Pistons’ owner Tom Gores. In March 2015, it filed Chapter 11 bankruptcy with $556.7 million in total debt and $34.3 million in assets after missing bond payments, but it was able to reorganize and emerge in July of that year. But not before automakers resourced several contracts, some going to Busche. At that time, Busche was growing thanks to a cash infusion from former Ford Motor Co. executive Michael Dingman’s investment firm Shipston Group Ltd. in 2014. The new owners put the company in overdrive, including establishing a new facility in Indiana and big new contracts from Honda and Fiat Chrysler. But fast growth plagued the supplier, Perkins said. The management team was inexperienced in the world of toptiered suppliers and its growing list of acquisitions and locations became difficult to manage. Perkins’ first order of business was to lead a $150 million recapitalization that left Busche with a new majority owner, Texas-based investment firm EF Capital Management, and an influx of cash. He also assembled a new manage-

ment team. Last week, founder Nick Busche stepped down from the company, which included replacing him at COO with Doug Forbes, a former plant manager at Joseph Perkins: Chassix. Perkins Spent years also hired Chris moving up ranks. Lilla to the company’s vacant CFO position and Tamika Frimpong to the newly created general counsel position and as the chief human resources officer. Lilla previously worked at Key Safety and Frimpong was at Nexteer Automotive when Perkins served as its CFO. “The company was disjointed; its many pieces had never been integrated,” Perkins said. “The management team was not at the level the company was performing. This is the maturing of a company, part of an evolution of a growing company.” The machining and castings business is “recovering from a hangover” tied to decades of poor contracts and mismanagement,” said Steve Wybo, senior managing director of Birmingham-based turnaround firm Conway MacKenzie Inc. “There are certain commodities in a vehicle that just don’t make money and, historically, this area has been one of them,” Wybo said. “These companies used to be a bunch of moms-and-pops that have been rolled up. There used to be just too many players and they all competed on price and totally diluted the margins. And these companies

(Busche and Chassix) have had to deal with all those old contracts that weren’t profitable from all those little guys beating the shit out of each other on price.” But Wybo said the vertical integration and professionalization of the space is starting show margin improvement. “There’s a lot of capital required for this segment, but we’re seeing vertical integration of the casting and machining business,” he said. “They are getting economies of scale and now we’re seeing smart people get behind them (financially) and they are starting to make money.” Busche will close the year out with revenue of about $370 million with 1,600 employees. Chassix revenue remains more than $1 billion with 4,000 employees. Perkins plans to capitalize on the past troubles of the industry. On top of building a backlog with General Motors, Ford and Honda, Busche is standardizing procedures and processes across its machining operations in Indiana, Ohio and Michigan and its foundries in Fruitport, Mich., and Franklin, Ind. Its goal is to take away business from its primary competitors, Chassix and Detroit-based Sakthi Automotive Group. “Our competitors are struggling a bit, in my opinion, so our focus is on continued organic growth,” Perkins said. “Really, we want to take this company to the next level, beyond what it could do before, and be resilient, execute. I’m excited.” Dustin Walsh: (313) 446-6042 Twitter: @dustinpwalsh

BUILDING FROM PAGE 3

“More modern” Elia plans to invest more than $9 million in the Woodward building built in 1972. The total comprises the purchase price and a substantial redevelopment that would include remaking its distinctive exterior. “We intend to completely modify the glass, change the entire façade of the building, make it more modern, approachable, exciting and unique in the sense that it’s the only building that’s not a high rise in that area and that gives us the unique opportunity to stand out,” Elia said. The potential buy is part of Elia’s strategy to invest in “landmark” locations in Detroit. He bought the Mercier Building on Fort Street, which houses the Anchor Bar. Elia also owns the Ford Building downtown, and the restaurants Fountain Detroit and Parc in Campus Martius Park with developer partner Matthew Shiffman and 220 Merrill in Birmingham. He hasn’t yet signed on an architect or general contractor for the incoming project. Other redevelopment decisions have yet to be made — whether Elia Group would expand the building, for example. Either a retail tenant or a restaurant operated by Elia’s Iconic Collection brand would take a spot on the ground floor next to the welcome center, he said. He would place office tenants in the three upper floors.

DDP CEO Eric Larson said his organization is “committed” to the potential deal that would include moving its operations. The 40-employee DDP currently resides in 10,000 square feet in the Dan Gilbert-owned One Campus Martius building, formerly the Compuware Building. The DDP subleases from a Compuware spin-off company, not directly from Dan Gilbert’s real estate firm Bedrock LLC, Larson said. The partnership oversees various planning strategies and programs, including the Business Improvement Zone that provides cleaning, safety and lighting services. He said there’s no firm schedule for moving, as the DDP has around a year left on its sublease term. “We are very pleased and honored we could potentially do this partnership,” he told Crain’s. The DDP is “continuing to build on its strategy to be closer to the community we serve.”

Amid rebound The tentative deal with Elia Group isn’t the first time the building has publicly neared a sale in recent years. Under previous county Executive Robert Ficano, the Detroit-based developer Roxbury Group had considered a $1.8 million deal for the building. Wayne County’s economic troubles and an incoming administration scuttled the plan. In the new, tentative deal, the rest of the $4.65 million sale price would go to the county’s general fund, after payback of approximately $2 million on bonds.

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TOWNSEND FROM PAGE 1

That’s partly to keep up with the industry, but also because pressure from competition is increasing — and getting uncomfortably close. An immediate challenge looms in the form of the Daxton, a $55 million, 120-room luxury hotel under construction a few hundred feet away from The Townsend’s front door. The Daxton intends to market itself at the same affluent customer base as The Townsend by offering upscale luxury but also on-location retail. “I’m sure there will be some people that want to check out the new kid on the block. They’re definitely on our radar,” Kalczynski said. “For what (the Daxton owners are) spending for that hotel ... they’re going to have to charge to decent dollars to get any kind of return. Whether they’re going to be able to do that is a different conversation.” The Townsend’s basic room rates range from $300 to $1,500 a night. There’s also a hotel boom underway in Detroit proper, with no fewer than 2,000 more rooms expected to come online in coming months and years. That’s been fueled in part by a rise in tourism as the city experiences billions of dollars in downtown investments and positive attention. A decade ago, between 11 million and 12 million people visited the region. Last year, that reached 19 million-plus, according to Michael O’Callaghan, executive vice president and COO of the Detroit Metro Convention & Visitors Bureau. The city has about 5,000 hotel rooms now in and around the central business district, but needs more to attract major sporting events such as the Super Bowl, NCAA Final Four and all-star games. “I still think there’s plenty of good business to go around (for hotels). Detroit is growing,” Kalczynski said.

Keeping up with the Joneses The Townsend has felt the effects of the wave of Detroit hotel construction — boutique hotels such as the Foundation, Shinola, and Siren hotels most recently — and hospitality projects elsewhere in the region. It’s even lost a little bit of business, like most hotels, to Airbnb, the service that allows private residential owners to rent their properties much like ho-

BIRMINGHAM FROM PAGE 1

Ron Boji, one of the developers on the project that also includes John Rakolta Jr., Victor Saroki and Paul Robertson, said a development agreement has not yet been signed but that public design meetings are tentatively slated for the spring. A term sheet is expected by January, he said. Multiple buildings are planned. While the outcome of that project isn’t yet set in stone, one thing is certain. “There is a greater demand for this kind of community, with a walkable feel,” said Sam Surnow, president of Birmingham-based real estate firm The Surnow Co., which is redeveloping the Church of Christ, Scientist property at 191 Chester St. into The Jeffrey, a 24,700-square-foot, $12.5 million office building named after his late father, well-known Birmingham developer Jeff Surnow, who

C R A I N ’ S D E T R O I T B U S I N E S S // N O V E M B E R 2 6 , 2 0 1 8 tel rooms, Kalczynski said. The Townsend, however, relies on its long reputation for luxury and one-on-one customer service to maintain its client base. “We’ve lost a couple pieces of business downtown, but what we may have lost we picked up in other things because of our reputation, because it’s a luxury property,” Kalczynski said. Since taking over day-to-day management of The Townsend, Kalczynski has overseen a series of renovations that have seen the hotel transition from an English manor decor to what he calls a more “modern luxury” look. “We’re in a renovation mode, just to keep up with the Joneses,” he said. “I would say that because of the lack of some really nice hotels, we’ve had an added advantage. I’m a believer in ‘bring on the competitors’ and everything that we’re doing now is preparing for whatever may happen in the future.” The Townsend averages 80 percent occupancy, Kalczynski said. Hotels overall in the metro Detroit region average 66.6 percent, according to data from Westbury, N.Y.-based hospitality research company HVS. Visiting pro baseball, hockey and basketball teams in town to play the Tigers, Red Wings, and Pistons can take up half the hotel, giving The Townsend steady business that its competitors don’t have. Teams can occupy 50-75 rooms or more. High-level customer service and a focus on privacy helps maintain that business, Kalczynski said. While some teams have tried other hotels, they return to The Townsend, he added. Suburban Boston-born Kalczynski, 64, assumed his role in September 2012 after running the Sheraton Doha Resort & Convention Hotel in Doha, Qatar. His 30-plus years in the industry also include general manager roles at the Ballantyne Hotel & Lodge in Charlotte, N.C., and the St. Regis Los Angeles. Ownership hired him because of that resume. The Townsend is owned by THC Investors LP, and its general partner is local businessman David Sillman. THC has made steady improvements over the decades, with perhaps the most significant being a $12 million expansion in 2000 that added 75 rooms, the 5,000-square-foot banquet room, a second lobby and more parking. The Townsend completed renovations of its tea lobby in January 2013 died in 2015. “People are veering away from malls, and it’s becoming more and more attractive to have this type of atmosphere. The market is hot and people are jumping on opportunities. People are paying crazy prices on things and are willing to take risks.” Example A: The $7 million price tag for less than an acre of land in 2016 on which construction is now taking place on the luxury 126-room, 17-residence Daxton Hotel, a project led by Mark Mitchell of Birmingham-based Lorient Capital (see related story). Matt Shiffman, whose Birmingham-based Alden Development Group LLC has more than $90 million in development projects nearing completion or in the pipeline, agreed with Surnow. “Values seem to be a little bit high on raw land,” he said. “That said, you have a lot of land owners that, in a strong economy, are trying to maxi-

and in 2016 it closed its 2,000-squarefoot street-facing The Corner bar after 16 years and renovated it into The Clancy Room, a space for group dining, meetings and small events. The 60-seat Rugby Grille restaurant, where notables such as Detroit Red Wings and Little Caesars pizza owner Marian Ilitch and Pistons owner Tom Gores have been spotted dining, regularly receives lavish praise and awards. It’s due for a makeover in couple years, Kalczynski said.

Inside The Townsend The hotel’s room inventory includes three large and especially elegant “Executive” suites and three even bigger and more opulent “Presidential” suites typically used by entertainers, elite athletes, coaches and other VIPs.

“We’ve lost a couple pieces of business downtown, but what we may have lost we picked up in other things because of our reputation, because it’s a luxury property.” — Steven Kalczynski, Townsend managing director

The Townsend boasts of luxuries such as 100-percent Egyptian cotton sheets with 316-thread count, goosedown comforters, large flat-screen LCD televisions in every room, marble bathrooms and Gilchrist & Soames bath products. The elite rooms have horse hair mattresses from Swedish maker Hästens that can cost up to $40,000, Kalczynski said. The deep-soak bathtubs are being replaced with showers in most rooms over a multiyear bathroom renovation that will be finished next year. Most travelers don’t use the tubs, Kalczynski said. “The individual traveler, they’re taking a shower,” he said. Other recent amenities include Bose radios, Frette linens and a wireless in-room control system for lighting and temperature. Each room has a digital doorbell. Its 24-hour gym remodeled this year now includes two Peloton stationary bikes. mize the biggest return that they can. But pricing on their land, to eager developers who want to do things at very high numbers, is challenging in order to make solid returns on investment.” Mark Nickita, co-founder and president of Detroit-based architecture and planning firm Archive DS and a Birmingham City Commission member, said the activity in Birmingham is a continuation of an ongoing drift toward downtown urban cores. “It has become of primary interest to development groups, in Detroit, Birmingham, Ferndale, Royal Oak. It’s become more and more prominent and downtown Detroit isn’t the only place people want to be. Birmingham has a certain character, a certain type of downtown that certain businesses, retailers and residents want to be in, just like Detroit and Royal Oak.” Kirk Pinho: (313) 446-0412 Twitter: @kirkpinhoCDB

The clientele The investments are to keep the influential and wealthy returning. Helping cement the hotel’s reputation early among entertainers were stays by Michael Jackson, Rod Stewart and Elton John, who were playing The Palace of Auburn Hills when it opened in 1988, the same year as The Townsend opened, said Kalczynski, who wears the hotel’s 30th anniversary pin on his suit lapel. Entertainers still stay at the hotel after the region’s primary concert venue switched from the now-closed Palace to new Little Caesars Arena in downtown Detroit. Business clientele tends to be C-suite executives and other senior leaders, often in town for corporate board meetings, Kalczynski said. All three major local automakers use the hotel, he said, as do many other companies. The guest mix is one of recognizable and influential names. “It’s really like being in Los Angeles; it’s the who’s who,” Kalczynski said. To keep them coming back, The Townsend is strict about privacy. The hotel forbids anyone from seeking autographs or photos with celebrities. The lobby elevators connect directly to the hotel’s underground parking garage, meaning athletes and celebrities don’t have to exit onto the street. Elite customer service also is part of the strategy. “One of the differences between a luxury and economy hotel is that my staff is empowered to make decisions in relations to guest satisfaction. We’re going to make sure that you’re serviced the proper way,” Kalczynski said. The hotel has more than 200 employees, and more than 100 have worked there for a decade or longer. They’re not unionized. Unlike the L.A. or Miami celebrity hangouts, The Townsend doesn’t get much in the way of strange requests, he added. “I had one Hollywood star that brought his own meat and cooked his own steak,” Kalczynski said. Also, teams and entertainers often have detailed travel arrangements, especially for their diets. Chefs and trainers work with the hotel kitchen on meals. Occasionally, teams will use a large meeting room and ask the hotel staff to leave because of sensitive issues, Kalczynski said. A couple of notable pro athletes were willing to talk about The Townsend.

The Jeffrey is a planned 24,700-square-foot, $12.5 million office building at 191 Chester St. CONTRIBUTED RENDERING

Draymond Green, the former Michigan State basketball star who now plays for the NBA’s Golden State Warriors while launching a business empire, has lavish praise for the hotel. “Spending more time traveling than at home, I make it a priority to find my go-to hotels that check every box I’m looking for — comfort, privacy, a high-quality gym facility and elegance,” Green said via email. “I’ve stayed at hundreds of hotels all over the country and there is none in the Midwest that better combines all of these things and feels like a home away from home.” Former Detroit Lions star Ndamukong Suh, who now plays for the L.A. Rams but maintains business interests in metro Detroit, regularly stays at The Townsend. “The Townsend Hotel is one of my favorites. The service is excellent. Everybody from upper management to the front desk staff always have their guests’ best interest at heart and it shows on every visit,” he said via an emailed statement. “I especially appreciate the bellmen — my interactions with them have always been fantastic and they are extremely helpful and accommodating.” Ninety percent of pro athletes who stay at the hotel do so under assumed names, Kalczynski said, a common privacy practice in sports. He has seen endless fake names. “Clark Gable. You name it, they’ve probably used it, something that doesn’t relate to them. I have one gi-

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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 // N O V E M B E R 2 6 , 2 0 1 8

Bad press

LARRY PEPLIN FOR CRAIN’S

The Townsend Hotel has undergone a series of renovations that have seen the hotel transition from an English manor decor to a more “modern luxury” look.

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Steven Kalczynski is The Townsend’s managing director and a 40-year veteran of the upscale hotel industry.

ant football player that comes in under a woman’s name,” he said. Most guests simply enjoy a traditional hotel stay without much fuss. Among the known “names” to have stayed at The Townsend are President George W. Bush who stayed after he was out of office, and both Clintons who attended fundraiser functions at the hotel but were not guests. One legend, maybe apocryphal but perhaps not, is that boxer Mike Tyson once left a $10,000 tip at the

hotel. The Townsend has a built-in geographical advantage over many local rivals because of its location: Upscale Birmingham is something of a self-contained walkable retail and dining ecosphere. “This hotel is more unique because it’s almost like being in New York, where you’re in a certain neighborhood of New York you can walk out the door and get a variety of things,” Kalczynski said.

While The Townsend doesn’t have the legendary celebrity antics of some of the L.A. hotels, it has had a few incidents over the years have slipped through the veil of secrecy. Perhaps the most famous incident at the hotel came in 2009 when Quicken Loans Inc. founder Dan Gilbert and his former business partner David Hall got into a brief physical altercation during a bar mitzvah attended by NBA stars Dwyane Wade and rapper T.I. It garnered a brief round of media attention. Detroit Tigers star Miguel Cabrera made headlines in 2009 for partying at The Townsend with friends from the Chicago White Sox before getting into a domestic squabble with his wife that night at home in an incident that led to the slugger being driven home from the Birmingham police station by then-team President Dave Dombrowski. The team reportedly also warned him not to drink at The Townsend after an incident reported as the first baseman taunting an overweight teenager. Other Townsend gossip has been the garden variety industry news of large unpaid bills. In 2010, the hotel filed a lawsuit against a film crew that it alleged stiffed the hotel for $37,000. And in 2014, police said a man using a stolen credit card ran up a $20,000 bill at the Townsend. The hotel tries to handle incidents discreetly, but much of how a situation plays out is in the hands of those involved, the police and the media. “In everything that we do, it’s communications. If there’s a negative public relations thing that happens to an entertainer or someone in sports, we’re obviously communicating very closely with the team or a manager who’s handling that particular individual, and working with them in how it’s approached,” Kalczynski said. The Birmingham Police Department is near The Townsend. “We’re very fortunate because the police department is right next door. When we have to push the button, they’re here very, very quickly. In my six-plus years, we’ve not had too many instances, not with entertainment and not with sports teams,” Kalczynski said. “There was one entertainer who wanted to keep the bars open ’til after 2 a.m. He wasn’t happy that we told him that wasn’t going to happen because it would be

EQUINE FROM PAGE 3

That requires unique property marketing, McCaig said. That marketing repertoire should include things like professional and drone photography and individual and personalized property websites, for example. Social media also helps, she said. “One of the things we have done recently is lifestyle videos, showing barn tours and putting life into these properties, showing people riding horses in the arena, feeding horses carrots,” McCaig said. Couple the limitations of the MLS with varying municipal ordinances on things like acres needed per horse, and allowed structure sizes, and you have a niche real estate industry that is tussling with not only market demands but also bureaucracy. DeHart said demand remains

against the liquor laws in the state of Michigan. Sometimes you have to work with them. ‘What you do in your room, sir, is up to you. Unfortunately, I can’t keep the bars open.’”

The threat Good press or bad, The Townsend is braced for serious competition from the Daxton, which is being built at the northwest corner of South Old Woodward and Brown Street, The project is a mixed-use commercial and residential building with street-level restaurant, ballroom, kitchen, commercial space and hotel lobby; a mezzanine level of meeting rooms, three floors of 143 hotel rooms, and 17 residential penthouse rental units on the top floor, according to online descriptions from the project’s Lansing-based building Clark Construction Co. The building also will have two floors of underground parking. The project is from Birmingham-based private investment firm Lorient Capital LLC, which normally pursues investments in the healthcare “micro” middle market. A message was left for Lorient’s management and for Chicago-based Aparium Hotel Group, which runs Detroit’s Foundation Hotel that opened last year and has been contracted to manage the Daxton. Hotel industry insiders say Aparium will use its management experience to siphon some Townsend business. How much won’t be known until the hotel opens. “They know what they are doing,” Brandon Leversee, senior project manager for hospitality research company HVS, said of Aparium. “They are going to try to disrupt the Townsend a little bit and take some of their clientele.” He said he thinks the Daxton will perform well because of demand for high-end hospitality space along the Woodward corridor and in Troy. The Townsend and Daxton have engaged in some bureaucratic squabbling, city records show, but the real action will come with the challenger opens. Advertising luxury is one thing. Whether the Daxton can deliver as The Townsend has is another. “The jury is still out on that,” Kalczynski said. Bill Shea: (313) 446-1626 Twitter: @Bill_Shea19 strong for 5- to 10-acre horse farms being used for personal use, even though horse ownership and the number of people taking riding lessons has declined in Nichole McCaig: Properties require the last two deunique marketing. cades. Part of that demand is caused by the high cost of boarding a horse on someone else’s property. There are an estimated 7.2 million horses in the country with more than 5 million of those being used for recreation, showing and racing, according to the American Horse Council. The latest survey by Michigan State University conducted in 2007 found that there are approximately 155,000 in the state. Kirk Pinho: (313) 446-0412 Twitter: @kirkpinhoCDB

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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 // N O V E M B E R 2 6 , 2 0 1 8

THE WEEK ON THE WEB

RUMBLINGS

Pedestrian plaza over I-696 likely to be replaced

Menorah in the D festival set for Dec. 2

NOVEMBER 16-21 | For more, visit crainsdetroit.com

unique pedestrian bridge over I-696 in Oak Park that’s home to a nearly 4-acre park is likely headed for replacement after a $6 million fix in 2016 didn’t work. The Michigan Department of Transportation is looking at funding for an estimated $25 million-$30 million “major modification” of the plaza that would likely convert it into more of a traditional bridge, said Matt Chynoweth, MDOT chief bridge engineer. The problem? Icicles. The bridge over the major thoroughfare at Church Street, between Woodward Avenue and Greenfield, isn’t “like any normal freeway bridge,” Chynoweth said. It has extensive landscaping, including soil and trees. It was built with a waterproof membrane in 1985, but water has since leaked through. That water forms icicles in the winter that could fall and hit a car on the freeway, causing injury. It hasn’t happened so far that MDOT knows of, spokeswoman Diane Cross said. But it’s still a safety issue. Simpler fixes, including injecting foam to seal joints, haven’t made for adequate remedies. Major reconstruction work in 2016 involved removing everything above the bridge beams, installing a concrete cap, and then replacing the sidewalks, parking lot, street, park and other landscaping on the plaza area. It was aimed at eliminating the icicle problem. “As that project was completed ... it became apparent to us that wasn’t the case,” Chynoweth said. “Water was still getting through.” At that point, MDOT began discussing long-term solutions. “We were thinking we could manage the bridge for another 10 years, but with the frequency and magnitude of icicles” a strategy is needed sooner, he said. He estimated MDOT will spend more this year contracting with companies to knock down the icicles, which it must sometimes close lanes to do — around $200,000, double the normal per-winter cost of around $100,000. Current discussions around funding center on a projected start date in 2024-25. Money would likely come from MDOT funds regularly set aside in a pot in varying quantities for “large, complex” bridge work, Chynoweth said. He said the project isn’t “set in stone,” but will most likely be a replacement. It would also likely be turned into more of a traditional bridge that is easier to maintain, but still includes a park element. The Oak Park plaza is among three built in the mid- to late 1980s. The one with the most significant leaks was built first and lessons learned were used for the other two, Chynoweth said. Icicles also occur on the other two, but they are in isolated areas and are more manageable, he added. The three bridges were built for members of the Orthodox Jewish community who generally don’t drive during the Sabbath, for easier travel around the community and to synagogues, following a lawsuit sur-

MICHIGAN DEPARTMENT OF TRANSPORTATION

In 2016, major reconstruction work on the plaza over I-696 in Oak Park included removing everything above the bridge beams, installing a concrete cap and then replacing the sidewalks, parking lot, street, park and other landscaping.

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

$500,000

The grant DTE Energy Foundation gave for the Motown Museum’s expansion.

$530 million

The amount in capital needs and deferred maintenance at Detroit Public Schools Community District. Signs point to need for another state bailout in the district, Moody’s said.

2.7 percent

The amount metro Detroit median home sale prices ticked up in October.

rounding the building of a section of I-696.

BUSINESS NEWS J Shinola/Detroit LLC was expected last week to open its fourth retail location in metro Detroit. It’s part of the soon-to-open Shinola Hotel downtown and features the Detroit-based brand’s full line of products, including watches and leather goods. The Woodward Avenue location will also exclusively offer the Shinola Hotel Runwell Timepiece gift set with the hotel’s address and details in the company’s blue color. J Untuckit LLC, a New York Citybased fashion brand specializing in men’s shirts meant to be worn untucked, opened its first store in Michigan last week at Somerset Collection in Troy. The store opened on the third floor of Somerset Collection North. The brand has also started selling clothes for women and boys. J New York-based Cowen Inc. agreed to acquire Quarton International, a financial advisory company with its North American base in Birmingham. Under the deal, expected to close Jan. 2, Cowen would take on all of Quarton International’s equity interests for $75 million up front. An additional $40 million would be paid dependent on Quarton hitting certain four-year performance mile-

stones that were not disclosed. The commercial mortgage-backed securities market in metro Detroit continues to see improvements over the last year. The most recent industry data from New York City-based Trepp LLC shows that there are more CMBS loans on the books, fewer delinquencies, lower overall delinquent balances and delinquency rates and a higher aggregate loan balance in the Detroit-Warren-Livonia metropolitan statistical area. J

OTHER NEWS J Without sufficient state support, the growing capital needs of Detroit’s public schools pose a potential threat to the city’s economic revitalization, Moody’s Investors Service said last week. A recent evaluation of the district’s facilities, along with the discovery of high lead levels in the district’s drinking water, has increased the urgency. J NBA Commissioner Adam Silver is looking at some changes for the pro basketball league, including legalized sports betting and dropping the minimum playing age to 18, he said in a wide-ranging talk in Detroit last week. About 300 people gathered for the discussion titled “Speed of the Game: A Conversation with Adam Silver and Dan Gilbert on the World of Business and Basketball,” hosted by the Detroit Economic Club at MotorCity Casino Hotel in Detroit. J Skillman Foundation, a Detroit nonprofit with an eye toward assisting Detroit children, revealed the winner of its float design contest for America’s Thanksgiving Parade in Detroit. Karayna Wayne, 9, a fourthgrade student from Weston Prep Academy in Detroit, saw her illustration — a globe dotted with smiling faces surrounded by children titled “Let’s Be Thankful!”— transform into 14-foot tall float last week at The Parade Co. studio. J Detroit entrepreneurship academy Build Institute is seeking a relationship with Ford Motor Co. as it plans an “affordable” co-working space on Michigan Avenue in Corktown. The nonprofit, which spun off this year from fiduciary Downtown Detroit Partnership, is looking to raise $50,000 through crowdfunding platform Patronicity to help fund a new headquarters. It has signed on as a tenant of The Corner, a $30 million mixed-use development at the old Tiger Stadium site.

he eighth annual Menorah in the D Festival of Lights will honor eight metro Detroit Jewish residents in their 8s — from ages 8 to 98 — and victims of last month’s shooting at a synagogue in Pittsburgh. This year’s festival is scheduled for Dec. 2 in Campus Martius Park in downtown Detroit to light a 26-foottall menorah and mark the first night of the eight-day Hanukkah holiday. The local honorees were selected for making an impact in their communities, organizers said in a news release. Among the honorees are 8-year-old Ariella Bednarsh of Shelby Township, who “made it her mission to educate everyone about the Jewish holidays and being Jewish,” according to the release, and Birmingham resident Martin Abel, 98, a founding member of the Shul Chabad Lubavitch in West Bloomfield Township. The Shul Chabad Lubavitch will host the event alongside the Jewish Federation of Metropolitan Detroit and Chabad of Greater Downtown Detroit. The festival is sponsored by DTE Energy Co., Quicken Loans Inc., Kroger, Beaumont Health and more. In the past, the event has drawn up to 3,000 people, and the same size crowd

or larger is expected this year, event spokeswoman Robin Schwartz wrote in an email to Crain’s. The event is funded by The Shul Chabad Lubavitch in conjunction with corporate sponsors. Schwartz declined to disclose the cost. Confirmed attendees include Detroit Mayor Mike Duggan, U.S. Rep. Brenda Lawrence of Southfield and Michigan Attorney General-elect Dana Nessel. StockX CEO Josh Luber is also expected to attend on behalf of the Quicken Loans Family of Companies, Schwartz said. The festival will also pay tribute to the 11 victims of the Oct. 27 shooting at the Tree of Life Synagogue in Pittsburgh. “We take strength from the menorah, always increasing in light, as the best possible way to combat the darkness that swirls around us,” Rabbi Kasriel Shemtov, spiritual director and founder of the Shul Chabad Lubavitch, said in the release. The free event, which starts at 4:30 p.m., will offer a range of activities, including face painting, balloon sculpting, glow-in-the-dark giveaways and more. The lighting of the steel-and-glass menorah is set for 5 p.m.

ZOYES CREATIVE

The Shapero Hall site is slated to be turned into a $108 million development known as Lafayette West.

Wayne State’s Shapero Hall demolition to begin S

hapero Hall is coming down. Demolition on the 151,000-square-foot former Wayne State University pharmacy school in Detroit’s Lafayette Park neighborhood is set to begin Dec. 6 with a “ceremonial sledgehammering.” Once complete, the 5.2-acre site is slated to be turned into a $108 million development known as Lafayette West, which is expected to bring 374 apartments and for-sale lofts to the neighborhood in a series of buildings, including a 12-story midrise.

The project is being developed by Novi-based Ginosko Development Co. Farmington Hills-based Hunter Pasteur Homes is the construction manager for the condos. An entity tied to Ginosko paid $16 million to Detroit real estate investor Dennis Kefallinos earlier this year for the property, according to city records. Lafayette West is one of several projects planned for the area that, in all, are slated to bring about 1,200 new residences over the next few years.

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