Year in Review: Crain's Detroit Business 2020 by Crain's Detroit Business

Stephen Ross

NEWSMAKERS O

ne of two billionaires behind the University of Michigan’s planned Detroit Center for Innovation, real estate developer Stephen Ross is Crain’s Newsmaker of the Year. And in observance of Crain’s 35th anniversary, we are creating a new honor, the Newsmaker Hall of Fame. The honoree is the man who helped sell Ross on Detroit, Dan Gilbert. Ross will be featured and Gilbert honored at a luncheon saluting all the Newsmakers on Feb. 21 at the MGM Grand Detroit. For tickets, go to crainsdetroit.com/ newsmaker.

CRAINSDETROIT.COM I JANUARY 6, 2020 M. Roy Wilson

NEWSMAKER HALL OF FAME

DECADE OF DAN How Gilbert changed Detroit’s trajectory

M. Roy Wilson | Page 19 Gretchen Whitmer

BY CHAD LIVENGOOD

In early 2009, Quicken Loans was trying to weather the worst housing foreclosure crisis in the nation’s history while two of Detroit’s Big 3 automakers were begging for federal bailouts — and the mortgage company’s chairman was stewing about Wayne County building a new jail at the foot of downtown Detroit. Matt Cullen had been working for Quicken Loans Chairman Dan Gilbert for only about a year when the boss called him into his office in a Livonia low-rise office building alongside I-275. Gilbert was fuming about Wayne County’s plans to build a new 2,000bed jail on Gratiot Avenue alongside I-375. “This doesn’t make any sense,” Gilbert told Cullen. “You have to get into it and try and change the trajectory of this thing.” Cullen came to work for Gilbert from the real estate shop at General Motors Co. — one of the automakers freefalling into bankruptcy at the time — and was flummoxed by the boss’ demand. “Well, there’s a couple of problems with that — we’re not even in Detroit,” he told Gilbert. “And this thing is already cooked.” Cullen was wrong. And it was an example of strategic thinking that would play out over and over in the ensuing year — which might as well be called the Downtown Decade of Dan. For that influence, which has landed Gilbert on Crain’s annual list of top newsmakers no less than eight times, Crain’s will honor Gilbert at our annual Newsmaker of the Year luncheon with our first Newsmaker Hall of Fame award. The jail construction project melted down in 2012 when then-Wayne County Executive Bob Ficano had to abandon the project after sinking $150 million of taxpayer money into the ground. See GILBERT on Page 21

Gretchen Whitmer | Page 18 Mark Stewart

Stephen Ross Page 10

Fran Parker

Fran Parker | Page 12 Tom Shea

Mark Stewart | Page 17 David Provost

Tom Shea | Page 13 David Provost | Page 16

Gary Jones

Andrew Brisbo

Gary Jones | Page 13 Suzanne Shank Andrew Brisbo | Page 15

NEWSPAPER

ILLUSTRATIONS FOR CRAIN’S DETROIT BUSINESS BY CHRIS MORRIS

Suzanne Shank | Page 14

THE CONVERSATION Rainy Hamilton Jr., of Hamilton Anderson Associates, on projects — and trains.

HEALTH CARE: Beaumont Health takes back pediatric hospice service. PAGE 3

PAGE 22 CRAINSDETROIT.COM I JANUARY 13, 2020

THE CASE FOR TOLLS? CHAD LIVENGOOD

ROADS

Why toll roads might not be as far-fetched as you think Since 2013, road construction companies working for the Michigan Department of Transportation have been slowly replacing a couple of I-94’s crumbling overpasses in Detroit each year. By 2039, they should be all done. You read that right. In nearly 20 years, Michigan may finally complete rebuilding one of the naChad LIVENGOOD tion’s first interstate highways this state helped invent in the 1940s and 1950s. The $2.9 billion remaining price tag for a project would effectively eat up the Michigan Department of Transportation’s capital budget for nearly three years if it were to focus only on replacing I-94 in Detroit. But there is a potential solution to waiting two decades to fix this economically vital thorSee TOLLS on Page 20 oughfare: Charge tolls.

FOCUS | CANNABIS RETAIL

MDOT to replace four highway bridges in Detroit this year BY CHAD LIVENGOOD

The Michigan Department of Transportation intends to close the crumbling Mt. Elliott Street bridge by the end of January as part of a plan to replace four aging bridges over I-94 and I-75 in Detroit this year. The 65-year-old Mt. Elliott Street bridge, part of which has had driving restrictions due to safety concerns, is slated to be demolished in late February, MDOT spokesman Rob Morosi said.

After that, MDOT’s contractors will tear down the Second Avenue bridge and East Grand Boulevard bridges over I-94, followed by the Milwaukee Street bridge over I-75 later in the spring, Morosi said. Those Mt. Elliott, Grand Boulevard and Milwaukee bridge projects are part of a $42.7 million contract MDOT plans to award to Milford-based Toebe Construction LLC in a packaged deal. See BRIDGES on Page 21

REAL ESTATE

How the recreational pot market is faring

Detroit projects scaling back

Business owners talk about the first month. PAGE 10

Rising construction costs put condos, other building at risk

NEWSPAPER

BY KIRK PINHO

Yet another condominium project in Detroit is on life support. The developer behind the planned $377 million The Mid project just north of Detroit’s Whole Foods Inc. store says that it’s “unlikely” the dozens of high-end condos that were planned as part of the two high-rises envisioned for the site will be developed after all. “We are evaluating luxury ex-

tended stay along with luxury multi-family for the residential units,” Turkia Mullin, a real estate executive working on the project, said in a statement to Crain’s. “The team has not made final decisions regarding changes to the program; however, it is unlikely we will develop condos.” Another project representative declined to say why they are now unlikely, although other luxury condo projects have been challenged in

the last year or so. It’s just the latest residential project in the city to take a difficult body blow. Developers of similarly upscale new luxury condo projects in and around downtown have said high construction costs have eaten away at their anticipated developer profit margins; lower-priced condos in Brush Park and Midtown, for example, have been completed. See CONSTRUCTION on Page 19

THE CONVERSATION Helen Taylor, state director of the Michigan Chapter of The Nature Conservancy, Lansing.

SOUR TIMES: Tariff elimination means tough road ahead for cherry industry. PAGE 6

PAGE 22 CRAINSDETROIT.COM I JANUARY 20, 2020

NAIAS

Bumpy January for some amid show shift

Businesses that benefit stay hopeful about June move BY DUSTIN WALSH, SHERRI WELCH AND ANNALISE FRANK

The North American International Auto Show’s move to June left a crater in balance sheets around metro Detroit’s business community — at least temporarily. With no January auto show at TCF Center (formerly Cobo Center), The Firebird Tavern is expected to lose 20 percent, or approximately $30,000-$35,000, in sales over a typical January. The Monroe Street restaurant in Detroit’s Greektown generally hosts three to five corporate events in the first month of the year tied to NAIAS, said co-owner Tony Piraino. Plus there’s an influx of visitors downtown during the show, and the less often accounted for workers who would land in December for setup. “We’ve been prepared for it for a long time,” Piraino said. “It’s the old adage of getting leaner and looking hard at our food costs, inventories, booze on the shelf, and understanding you’re going to have a slow month and bracing and preparing for that … a little bit less (staff ) hours based on how busy we are, but not drastic. Some of it is still an unknown. Usually the auto show kicks off around this time, so … the book is still out.” A January without an auto show played at least a minor role in a decision to close Corktown restaurant Gold Cash Gold, chef-partner Brendon Edwards said in an email to staff announcing the closure last week. The Southern-influenced American restaurant will close around Feb. 2 after five years in business. See AUTO SHOW on Page 18

FOCUS | WORKFORCE TRENDS

FACING THE FUTURE OF WORK The future is here: Automation and artificial intelligence are part of how we work today. But are Michigan businesses ready for how radically they will change our jobs and our organizations?

Plus: How to harness the power of AI to better understand your employees. PAGES 10-12.

ILLUSTRATION BY IRINA STRELNIKOVA

REAL ESTATE INSIDER

Testing the marijuana market: Business booms at safety compliance labs BY KURT NAGL

Asking $18 million for Detroit riverfront properties PAGE 4

NEWSPAPER

CANNABIS

The cost for marijuana growers and processors to certify product for safety compliance, as mandated by Michigan, is whatever a lab wants to charge. That’s because in the state’s incipient marijuana industry, there is still relatively little competition in cannabis testing and lots of demand. There are seven facilities licensed to test medical marijuana and just one approved to test both — PSI Labs LLC in Ann Arbor. The business backlog swells by the day at the lab, located in an office complex on the outskirts of the propot town. Not only is it the only place in the state to certify recreational product, it is the only lab equipped to

A vial of powdered cannabis being tested for contaminants and heavy metals. | KURT NAGL/CRAIN’S DETROIT BUSINESS

test for Vitamin E acetate in vapes. So when the state in November ordered all retailers to test for the harmful compound, PSI was inundated with marijuana-infused vape cartridges. After unburying itself from vapes — a surprise bit of work that’s likely amounted to a million-dollar-plus windfall for the company — the lab will refocus on its core business of general marijuana safety certification testing, where it has majority market share, said CEO Ben Rosman, 37, who co-founded PSI in 2015 with childhood friend Lev Spivak-Birndorf, also 37. See LABS on Page 20

THE CONVERSATION CEO of the Charles Stewart Mott Foundation, Ridgway White, is ‘nervous about Flint.’

NONPROFITS: Gleaners aims to tackle hunger through the schools. PAGE 3

PAGE 22

CRAINSDETROIT.COM I JANUARY 27, 2020

Third woman accuses Lucido of sexual harassment Alleges touching at trade-group meeting BY CHAD LIVENGOOD

LANSING — At the Michigan Credit Union League’s annual government affairs conference last May, Melissa Osborn stood at a table in the Radisson Hotel handing out name badges to legislators as they arrived for lunch with credit union executives from across the state. One veteran male lawmaker who arrived at the downtown Lansing hotel’s second-floor conference center complimented Osborn about her reddish hair. Osborn, a regulatory affairs specialist for the trade group, thought nothing of it. About 10 minutes later, Osborn said, she felt a hand on her hip. It was state Sen. Peter Lucido, she said. Osborn said she suddenly found herself being “uncomfortably” held by the first-term Republican senator from Shelby Township as he started commenting about her red-and-black plaid pencil dress and how it looked on her. “He was looking at me up and down,” Osborn told Crain’s. “And he stayed there for several minutes, making these comments about my appearance and my look and what he liked about it.” During the entire interaction, Lucido’s hand remained on what Osborn described as “my lower back/ upper butt.” “He wasn’t cupping my butt, but (his hand) was definitely not really all on my back either,” Osborn said. “It was in a strange spot, like he was toeing the line intentionally but still making me very uncomfortable.” Osborn, 40, is the third woman who works in Lansing to come forward in the past two weeks and publicly accuse Lucido of workplace sexual harassment in and around the Capitol. See LUCIDO on Page 21

Casinos go all in on sports bets

Progress, but only so much

Newly legal activity to generate fresh customer base, millions in revenue

Survey: Women inch closer to parity in Michigan boardrooms, but less so in the C-Suite | BY DUSTIN WALSH

BY KURT NAGL

Detroit’s three casinos are betting big on sports gambling with expectations for the newly legal activity to generate a fresh customer base and millions of dollars in additional revenue. Even before sports betting became legal in December, MGM Grand Detroit’s $6 million Las Vegas-like sports lounge was open. The 4,400-square-foot area was packed to the gills for the recent Conor McGregor-Donald Cerrone UFC match,

“THEY HOPE BY MARCH MADNESS. WE’RE HOPING TO MOVE IT ALONG.” — Mary Kay Bean, Michigan Gaming Control Board spokeswoman

omen-held board seats at Michigan public companies have hit record highs. By the start of 2020, women held 21 percent of board seats, compared with just 15 percent in 2017. Michigan’s 77 public companies are keeping pace with the S&P 500. Michigan companies added 121 board members between 2017 and 2019 and 26 percent were women, compared to 30 percent women among the S&P 500, according to a new study released today by Wayne State University for Detroit-based Inforum. However, that progress is mostly accounted for by heavy pressure from institutional investors demanding more gender equality on boards because research has revealed more gender parity equates to better financial performance.

NEWSPAPER

SPORTS BUSINESS

DIVERSITY AND INCLUSION

JOHN LABBE

GOVERNMENT

When it comes to the C-suite, gender parity has further to go. Women comprise only 12 percent of named executive officers — the CEO, CFO and at least the next top three compensated management employees as required to be named in U.S. Securities and Exchange Commission filings — a figure that hasn’t budged in 13 years. “We’ve seen board numbers (for women) improve as there has been tension placed on board members by institutional investors,” said Terry Barclay, president and CEO of Inforum. “The new frontier is the talent pipeline. It’s the broken rung. This all starts with the first promotion women don’t get, and we’re seeing the effects of that as it moves through the pipeline.” See SURVEY on Page 18

FOCUS | HEALTH CARE  Insight Institute invests in health care, community in Flint. PAGE 10 ‘Healing center’ aims to put services under one roof. PAGE 11

said Louis Theros, legal counsel for MGM. While nobody there bet a legal dime on the 40-second fight, the turnout had operators itching to open their sports book and expand the casino’s dominant share of the Detroit market. “We think this will bring a tremendous amount of money out of the illegal market,” Theros said. “I think we have a very unique opportunity in Michigan to capitalize. Let’s face it, we’re a sports-crazy community.” The start is waiting on rules to be finalized. MGM Grand Detroit, MotorCity Casino Hotel and Greektown Casino-Hotel are waiting on the Michigan Gaming Control Board’s go ahead. The upcoming NCAA men’s basketball championship tournament, which kicks off March 17, is the launch target. “They hope by March Madness,” said Mary Kay Bean, Michigan Gaming Control Board spokeswoman. “We’re hoping to move it along.” The control board said last week that unlike on-site sports gambling, online betting is still about a year away from reality given the greater complexity of the rules needed. Greektown Casino is putting sports betting at the center of its business — physically, anyway. Penn National Gaming Inc., which in a $1 billion deal bought the casino from Dan Gilbert’s Jack Entertainment LLC last year, is investing upward of $1 million into a temporary sports betting lounge, Greektown General Manager John Drake said. See BETTING on Page 20

THE CONVERSATION Ping Ho, majority owner or partner in four Detroit restaurants, talks of her path from Singapore to New York to Corktown.

SPORTS BUSINESS: The Ilitch family hits jackpot with legal sports betting. PAGE 3

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CRAINSDETROIT.COM I FEBRUARY 3, 2020

AUTOMOTIVE

BorgWarner to buy Delphi to stave off EVs’ impact

WELLNESS

SURVIVAL OF THE FITNESS

BY DUSTIN WALSH

Electric vehicles accounted for a mere 1.8 percent of U.S. autos sold last year. Yet the business is restructuring the entire automotive sector and forcing vulnerable suppliers to weld together. Last week, BorgWarner Inc. struck a deal to acquire Delphi Technologies in an all-stock deal that values Delphi at about $3.3 billion. The deal will unite two auto suppliers facing substantial financial pressure from the predicted shift to electric vehicles. Both companies’ engine and transmission businesses are seen by analysts as entering a period of decline, but are hoping a coupling will create enough volume to sustain. Experts say this is the start of a long and possibly painful consolidation throughout the industry. That will come at a time when some are predicting sales of internal-combustion engines — and perhaps autos overall — may have peaked for all time. “I believe the merger to be one of many to come, and one of necessity,” said Marcus Hudson, executive director at Calderone Advisory Group in Birmingham. “Suppliers are positioning themselves for the move to electric vehicles as well as declining automotive volumes. The merger allows BorgWarner, specifically, to continue to compete in traditional powertrains while setting it up to transition, however slowly, to the age of electronic vehicles.” Under the terms of the agreement, which has been approved by the boards of directors of both companies, Delphi Technologies stockholders would receive 0.4534 shares of BorgWarner common stock per Delphi Technologies share. That equates to about $1.6 billion worth of Delphi Technologies stock. See DELPHI on Page 18

Amina Daniels’ 2020 goal is differentiating her Live Cycle Delight further from competitors. | SYLVIA JARRUS FOR CRAIN’S DETROIT BUSINESS

Boutique fitness business accelerates, but competition can mean heavy lifting BY ANNALISE FRANK

The fitness studio business is accelerating in metro Detroit, with consumers seeking ever-creative ways to burn calories and get fit.

NEWSPAPER

But that means heavy competition. Options for niche exercise programs are seemingly endless in Detroit, its suburbs and the rest of the country: pilates, yoga, barre, CrossFit, high-intensity interval training, kickboxing, Zumba dance classes and indoor cycling, to name a few. Some chains or local gyms entering the metro Detroit market narrow in on specific offerings, like New York-based dance-cardio fitness chain AKT, New Yorkbased rowing chain Cityrow and indoor cycle studio Rebel Cycle Studio LLC. Others’ offerings are more gen-

POLITICS

Is a grand bonding bargain brewing? Just before Christmas, Gov. Gretchen Whitmer heralded the state’s early payoff of $3.2 billion in bonds issued by her predecessor to smooth out Chad the cost of unemLIVENGOOD ployment insurance debt Michigan employers racked up during the Great Recession. It’s exactly the kind of debt Whitmer has been loathe to take on to smooth out the high cost of teacher pensions for school districts strained by legacy costs and just a recession away from a full-fledged fiscal crisis. Last year, Whitmer rejected out of hand a proposal concocted by a group of conservative West Michigan businessmen to issue $10 billion in bonds and invest the proceeds through the Michigan Public School Employees’ Retirement System to refinance the annual cost of pensions for retired public school employees. Admittedly, I was more than a little skeptical of the idea, having chronicled the disastrous pension bond debt deal that landed the city of Detroit in bankruptcy. In a memorable one-liner, Whitmer said the pension-bonding plan was “retrieved out of Gov. Snyder’s trash can.” See LIVENGOOD on Page 18

FOCUS | REAL ESTATE

eral, but come out of need or demand for fitness options. Felicia Maxwell’s Fit 4 Life Health and Fitness, for example, opened in August 2017 in Detroit’s northwest corner, which lacked a neighborhood gym. More entrants to the market can create clusters of businesses. Downtown Royal Oak, for example, has at least 10 specialized workout studios. In Detroit, where Amina Daniels says she opened one of the city’s first new-wave boutique fitness studios, she’s feeling the burn. See FITNESS on Page 21

MOBILE HOME PARK ON CASS LAKE COULD GIVE WAY TO LUXURY APARTMENTS. PAGE 10 Q&A WITH JOHN MCLAREN, COO OF SUN COMMUNITIES. PAGE 11

THE CONVERSATION Saunteel Jenkins, CEO of The Heat and Warmth Fund, grew up with her “heart for service.”

Coronavirus impact looming. PAGE 3

PAGE 22

CRAINSDETROIT.COM I February 10, 2020

ROADS

Will bonding plan pump up construction costs? At last Thursday’s hearing for the unveiling of Gov. Gretchen Whitmer’s 2021 budget plan, the Republican chairman of the Chad House AppropriLIVENGOOD ations Committee put his finger on a blind spot in the Democratic governor’s plan to issue $3.5 billion in road construction bonds. Rep. Shane Hernandez, R-Port Huron, told Whitmer’s budget director, Chris Kolb, that he’s heard concerns in recent years from municipal officials about the inflating cost of repaving and rebuilding city streets and county roads. “How does this budget address those concerns of our locals on smaller projects, on getting competitive bids and their prices inflating?” Hernandez asked Kolb. “And does this $3.5 billion make that issue worse?” Kolb initially danced around the question. “I’m not trying to filibuster,” he said with a smile. But filibustering is exactly what the budget director did, steering clear of the nagging problem exposed by Hernandez’s question. Kolb held up a map of the state detailing how Whitmer’s budget plan boosts funding for schools. The map showed counties shaded in green with school districts that are getting the highest increase in per-pupil funding in 20 years. See LIVENGOOD on Page 20

SMALL BUSINESS

Stitching a future Adel Hamka and his nephew, Mohammad Hamka, select a tie for a shirt at the shop he co-founded with Mohammad’s late father, Abe. Mohammad says, “I want to support my uncle, but I like it. Yes, it’s my responsibility, but it’s also an honor.” | JOHN SOBCZAK/ LORIEN STUDIO FOR CRAIN’S

How a small business is trying to move on without its patriarch BY DUSTIN WALSH

Amid a kaleidoscope of thread spools and wool fabric shards, Mohammad Hamka cries. The sewing machine he sits behind is his father’s. Was his father’s. Mohammad’s father, Abdallah “Abe” Hamka and his uncle, Adel Hamka, opened Oxford Tailor & Clothing on Grand River Avenue in Novi in 1986, four years before Mohammad was born. The brothers hemmed together a loyal customer base from quality work, built from Adel’s adept hands and Abe’s charismatic attention to customers and paperwork.

FOCUS | MICHIGAN BUSINESS: GRAND RAPIDS

 Former Founders

chairman pursues ‘future of farming’ with hydroponic lettuce. PAGE 10

Mohammad Hamka, Abe’s son and an apprentice tailor, reaches for a spool of thread. | JOHN SOBCZAK/LORIEN STUDIO FOR CRAIN’S

death. His own son, Mike, is temporarily performing Abe’s bookkeeping and bill paying duties. Oxford, like so many small businesses, had no succession plan, no guiding system for how to navigate a tragedy. So Adel and Mohammad limp along for now, learning new skills and maintaining a business and a legacy. “His hand is everywhere,” Adel, 65, said, gesturing to the wool cutaways and plastic-sheathed suits while wiping a tear from behind his glasses with the other hand. “This shop feels empty. I feel empty ... my life is empty without him.” See TAILOR on Page 21

INSURANCE

Health insurers, employers scramble to prepare for no-fault reform BY CHAD LIVENGOOD

NEWSPAPER

Now the 29-year-old Mohammad, a brand new apprentice in the trade, is confronting a reality where each needle he threads and buttonhole stitch he manipulates brings sorrow. Abe, 55, died on Oct. 24 while swimming in the Red Sea along the coast of Egypt on vacation. The avid runner suffered from cardiac arrest due to an undiagnosed heart condition, leaving behind heartbreak and a son and brother to navigate the nuances of the business he quarterbacked. Adel only recently ordered new casual shirts for the store, some three months after his brother’s

Some major health insurance companies are warning state regulators they won’t be able to immediately comply with a key component of auto insurance reform that lets motorists drop unlimited medical coverage on their no-fault policies. The new law going into effect July 1 stipulates that motorists who want to forgo Personal Injury Protection to lower their overall monthly premiums have to prove to their auto

insurance carrier they have a qualified health insurance plan that covers auto injuries. The PIP opt-out is the centerpiece of the Legislature’s effort to lower the high cost of auto insurance in Michigan through an overhaul of the 1973 law that Gov. Gretchen Whitmer signed into law last May. The provision has some human-resources and benefit managers at major employers in Michigan reviewing their health care coverage in anticipation of a barrage of ques-

tions from employees about whether they can drop PIP coverage to save money on auto insurance premiums. Last month, Whitmer’s Department of Insurance and Financial Services issued a bulletin to state-regulated health insurers directing the companies to “develop a document that indicates whether a person’s coverage is ‘qualified health coverage’ for purposes of nofault insurance.” See INSURANCE on Page 20

CRAINSDETROIT.COM I FEBRUARY 17, 2020

CRAIN’S EXCLUSIVE

THE DAY EVERYTHING CHANGED In his first interview since his stroke, Dan Gilbert opens up on his recovery: ‘One day at a time’ BY CHAD LIVENGOOD

n the Saturday night before Memorial Day, Dan Gilbert and his wife, Jennifer, were hosting friends on the roof of his downtown Detroit apartment at the Vinton Building. High-powered lights were beaming from nearby Hart Plaza as concertgoers danced to the blaring beat of electronic music at the annual Movement Music Festival along the Detroit riverfront. That’s when Dan Gilbert started “seeing double people.” “I thought it had to do with (the lights),” the Quicken Loans founder recalled. It didn’t. In attendance at the Gilberts’ party that night was Steven Adamczyk, an emergency room physician who has coached their youngest son’s basketball team. The doctor urged Gilbert to go to a hospital, even as the self-made billionaire resisted. See GILBERT on Page 20

ILLUSTRATION BY PETER STRAIN FOR CRAIN’S DETROIT BUSINESS

NEWSPAPER

THE CONVERSATION

In the Lions front office, senior VP of business development Kelly Kozole tackles issues beyond football. PAGE 22

Kelly Kozole

CRAINSDETROIT.COM I February 24, 2020

CRAIN’S NEWSMAKERS

‘WE’RE GOING TO DOUBLE DOWN’ How Gilbert’s stroke could harness change for the better

“DETROIT IS JUST A MUCH TIGHTER CITY RELATIONSHIP-WISE THAN IT’S EVER BEEN. THAT’S THE KIND OF MARKET YOU CREATE WHERE THINGS HAPPEN.” — Dan Gilbert

Detroit businessman Dan Gilbert speaks at the Crain’s Newsmaker of the Year luncheon on Friday. | PHOTOGRAPHS BY ANDREW JOWETT FOR CRAIN’S DETROIT BUSINESS

Ross pledges $100M to UM center as Gilbert makes his first public speech since stroke BY NICK MANES AND KURT NAGL

Standing with a wheelchair behind him, Detroit businessman Dan Gilbert on Friday afternoon delivered his first public remarks since suffering a debilitating stroke on Memorial Day weekend last year. His appearance came at Crain’s Newsmaker of the Year luncheon, at which Gilbert received Crain’s first Newsmaker Hall of Fame award.

See NEWSMAKERS on Page 20

INSIDE

See LIVENGOOD on Page 20

REAL ESTATE

NEWSPAPER

New York real estate developer Stephen Ross was honored as the 2019 Crain’s Newsmaker of the Year.

The 2019 Newsmaker of the Year, New York real estate developer Stephen Ross, also announced at the event that he is pledging $100 million toward funding the planned University of Michigan Detroit Center for Innovation development. Aside from a brief mention of his nine-month “absence,” Gilbert made no mention of the stroke that left him temporarily paralyzed on the left side of his body.

“If you have a stroke, when you’re done, here’s the problem with it: Everything is hard. Everything. Like you wake up, getting out of bed is hard, going to the Chad bathroom is hard, LIVENGOOD sitting down eating at a table is hard. You name it. You don’t get a break. You’re like trapped in your own body.” — Dan Gilbert, stroke survivor When Detroit business tycoon Dan Gilbert described his new daily reality after suffering a debilitating stroke, I immediately thought of my brother, Brian, while I sat in the Quicken Loans chairman’s Detroit office. Brian, who is 16 months younger than me, suffered a catastrophic brain injury from a freak electrocution accident, leaving him trapped in his own body at age 20 — and probably for the rest of his life. For almost 16 years, Brian has required around-the-clock care for everything Gilbert said has became hard for him to do after a blood clot in his carotid artery cut off blood flow to his brain, causing paralysis on the left side of his body. My brother, who turns 36 next month, can stand only with assistance. But he can’t walk, talk, get himself out of bed, use his hands for anything or consume hard foods. You name it. He never gets a break from being trapped in his 6-foot-1 frame.

Time, thawed relationship set stage for once-unlikely Taubman deal BY KIRK PINHO

Need to know

Fifteen years ago, David Simon and Robert Taubman were not on speaking terms. The former had attempted a nearly yearlong takeover of the latter’s then half-century old mall real estate investment trust in 2002-03 while his father, A. Alfred Taubman, was in prison for his role in a price-fixing scheme. There was bad blood. Today, following an expected $3.6 billion purchase of Bloomfield Hillsbased Taubman Centers Inc. by Indi-

 $3.6 billion purchase of Taubman Centers Inc. by Simon Property Group announced this month  Simon had attempted takeover in 2002-03  Taubman family preserves protected tax status in deal

anapolis-based Simon Property Group announced earlier this month, the two have culminated

what has been described by people familiar with the matter as a gradual but painful thawing of what was at one time an icy relationship. So although they may not be getting their families together for Saturday night pizza and Netflix any time soon, they at least are able to strike a major merger of their shopping center REITs at a time when much of the retail sector nationally is facing a reckoning. See TAUBMAN on Page 19

M&A: Rocket Fiber sale marks one of first exits for a Gilbert-backed startup. PAGE 3

PLANNING FOR POT Tatiana Grant on marketing marijuana. PAGE 22

CRAINSDETROIT.COM I MARCH 2, 2020

SPECIAL REPORT

REAL ESTATE

PANDEMIC PREP

Coronavirus has companies bracing for what’s next

VW nears deal to move from Auburn Hills to Southfield Employees would move to Galleria Officentre BY KIRK PINHO

A Kalitta Air plane, chartered by the United States government, carried U.S. and Canadian citizens home from Wuhan, China, last month. The charter operator also has a big opportunity as air freight prices have spiked. | DARRYL DYCK/THE CANADIAN PRESS VIA AP

Readiness front and center for employers

BY SHERRI WELCH

With the spread of coronavirus looming over Southeast Michigan, is your business prepared? Most large employers have a pandemic policy as part of a larger business continuity strategy, but those plans may be largely untested, said Tim Williams, vice chairman of Ann Arbor-based risk management firm Pinkerton. And many small and midsized companies haven’t developed contingency plans, making their operations vulnerable in the event of a widespread outbreak, he said. And that could translate to health concerns for employees, business and market share losses and legal headaches, experts said.

Williams

Sutfin

They’re cautioning businesses that don’t have a plan in place to develop one now. But having a plan is only the first step, Williams said. Companies that practice responses to crisis events “develop a muscle memory,” he said. See PLANS on Page 20

Air freight specialists see business boom as shipping gets constrained BY DUSTIN WALSH

As factories across China continue to come on line in the coming weeks after a month-long shutdown from the COVID-19 coronavirus outbreak, the manufacturing sector is scrambling to get parts across the Pacific Ocean. Commercial flights — which carry 40 percent to 50 percent of all air freight from China — remain grounded and unable to meet the demands of the sector. But Ypsilanti Township’s Kalitta Air is waiting in the wings and may see a boon in the virus’ wake. The coronavirus outbreak slammed China right at the Chinese Lunar New Year, when most automotive and manufacturing

plants shut down between Jan. 24 and Feb. 2. But the government-mandated quarantines have lifted in most of China’s provinces and some production has resumed, albeit not at full capacity. But with typical ocean freight taking six to eight weeks to reach U.S. shores on freighters, many companies are using costly expedited air freight. “There is going to be lots of demand,” said Brandon Fried, executive director of the Washington D.C.-based Air Forwarders Association. “Shippers are not going to have time for the next ocean freighter sailing out. They are going to run out to the airport to look for air cargo space.”

REAL ESTATE INSIDER

NEWSPAPER

PRICE DROP  Ilitches say Eddystone construction costs have fallen to $35 million. PAGE 4

See FREIGHT on Page 20

Volkswagen of America Inc. is nearing a deal that would move it from Auburn Hills to Southfield. Sources familiar with the matter confirmed the contours of the German automaker’s plan, which involve moving its employees in Auburn Hills to the Galleria Officentre property near 12 Mile and Telegraph roads and building an addition west of the complex. Negotiations are not final, and no leases are signed for the property, sources said. Any number of factors could ultimately torpedo the deal, including sign-off from Volkswagen. Farmington Hills-based Friedman Real Estate owns the Galleria; David Friedman, its executive managing director and founder, declined comment. “Volkswagen Group of America is exploring its options on the leased facility in Auburn Hills. No decision has been made,” the automaker said in a statement. A site plan approved by the Southfield City Council in late January shows a 95,500-square-foot addition to the 200 Galleria building constructed across two stories. The plan refers to it as lab and tech space, but Volkswagen is not named as the user. Terry Croad, Southfield’s planning director, said representatives from Friedman Real Estate said at a public meeting there would be up to 1,800 employees across the new addition, which would cost at least $8.5 million, and 300,000 square feet-plus at the Galleria. The 200 Galleria building is 250,000 square feet across four stories, according to CoStar Group Inc., a Washington, D.C.-based real estate information service. It is part of a four–building complex that Friedman Real Estate purchased in 2016. The 100 Galleria building is about 242,000 square feet, CoStar says. Sources said VW would take all of the 200 Galleria building and possibly part of the 100 Galleria building, which Friedman has been emptying for months to free up space for the automaker. Friedman has also been in discussions to purchase the nearby AMC Star Southfield 20 movie theater at 25333 W. 12 Mile Road. See VOLKSWAGEN on Page 18

THE CONVERSATION

CORONAVIRUS IN MICHIGAN

McKinley Inc. CEO Albert Berriz talks workforce housing, Ann Arbor and Cuba. PAGE 23

 Which companies are at risk, and which stand to gain? PAGE 3  How nursing homes are preparing. PAGE 3

CRAINSDETROIT.COM I MARCH 9, 2020

CRAIN’S INVESTIGATION

Real estate executive’s lottery scheme collapses when his luck runs out

REVERSAL OF FORTUNE

More to the story

BY KIRK PINHO

Viktor Gjonaj was allegedly spending as much money each week on the Michigan Lottery as the bureau that oversees that state enterprise fund allocates each year to gambling addiction treatment and education: $1 million. And for the 42-year-old former commercial real estate executive, at times that gambling paid off tremendously, with winnings on the Daily 4 game totaling at least $21.5 million in just three winning days across a span of about seven weeks in early 2018 and no less than $28 million overall, according to sworn testimony taken in Oakland County Circuit Court in September and other records. A winning Daily 4 ticket can pay up to $5,000; the Daily 3, up to $500. But Gjonaj could manage his problem — until he couldn’t anymore. The winning streak that was allegedly financed with millions of dollars from an alleged Ponzi scheme wouldn’t last, and within about two years of his first known big payday, Gjonaj went from being a prominent player in the commercial real estate industry to a pariah. For Gjonaj, who hasn’t been heard from since the summer even as at least 11 court cases involving him have been filed, his habit culminated with him apparently drunk and upset in an Ann Arbor hotel, according to a Ann Arbor Police Department report. When law enforcement found him on a warmer-than-average August evening near a Kensington Hotel elevator, he was wearing nothing but boxer shorts outside of his third-floor room.

 A timeline of Gjonaj’s massive winnings, then trouble. Page 18  How we reported this story. Page 18  Ticket sales boosted Macomb County stores. Page 20

 Lottery took unprecedented step to limit sales. Page 20  Online extra: Q&A with former lawyer Michael Burke, now head of the Michigan Association on Problem Gambling, whose addiction led him to state prison. Read it on CrainsDetroit.com ILLUSTRATION BY MICHAEL HOGUE FOR CRAIN’S DETROIT BUSINESS

See GJONAJ on Page 18

FOCUS | CRAIN’S MICHIGAN BUSINESS: THE THUMB  Trial lawyer quit his day job for kayaking. PAGE 10

NEWSPAPER

RETAIL

How Art Van’s house burned down BY DUSTIN WALSH

Art Van began its final sale Friday. The Warren-based retailer’s sudden announcement that it would wind down operations comes only three years after its late founder, Art Van Elslander, sold the company to a Boston-based private equity firm, Thomas H. Lee Partners LP, in an estimated $550 million deal. How did a seemingly healthy,

valuable and beloved company go so wrong so fast? After its 2017 acquisition, Thomas H. Lee set an aggressive strategy to open 200 more stores and double revenue to $2 billion by 2020. But saddled with roughly $400 million in debt and no financial cushion to respond to the disruption of changing furniture habits left Art Van’s business model sitting on a tinderbox. Management missteps

were all the fuel needed to burn the house down. The story of Art Van’s demise is full of finger-pointing and finger-wagging from consumers and experts blaming bad management from financial acquirers, and consumers’ growing penchant for online retail. They’re all true. See ART VAN on Page 17

CRAINSDETROIT.COM I MARCH 16, 2020

RISING TO A CHALLENGE CORONAVIRUS IN MICHIGAN

THE RESPONSE

A week we’ve not seen before Businesses in uncharted territory as caution halts many activities BY CHAD LIVENGOOD

This week will be like nothing most living Americans have ever experienced. Schools across Michigan are shut down for three weeks, displacing 1.6 million children and causing child care headaches for working parents and guardians. Large corporate headquarters like Ford Motor Co.’s Glass House in Dearborn and General Motors Co.’s Renaissance Center in Detroit will largely be deserted as white-collar workers have been ordered to work from home. Some Quicken Loans loan officers are going to be processing a mountain of refinancing applications spurred by low interest rates from their basements. Every sporting event from the Big Ten basketball tournament to the Detroit Tigers’ Opening Day on March 30 has been nixed. Novi’s boat show sunk. Seemingly every gathering of people with common interests is canceled.

THE IMPACT

Facts are the antidote to fear A week ago, we were wondering. Should we practice working from home? Should we hold our conference? Do we have enough hand sanitizer? As I’m writing this at mid- Michael day Friday, those concerns seem quaint. The governor just LEE announced a ban on gatherings of over 250 people less than a day after ordering schools closed. General Motors and Ford ordered all workers who can to work from home starting Monday. It’s hard to say what might be next. The arrival of the new coronavirus in Michigan is a constantly changing story, affecting every aspect of daily life and every business. We’re all going to have to get used to new habits, create new routines and processes, and figure out how to get our jobs done on the fly in circumstances that none of us have seen before. We’re here to help you do that, to tell you what you need to know today to get that job done. Facts are the antidote to fears, and reliable information is what will get us through this strange time. Last week, as a public service, we lifted the subscriber-only pay wall for all stories regarding the coronavirus and its impact on metro Detroit. See LEE on Page 28

Southeast Michigan housing market will take a hit as economic fears grow BY KIRK PINHO

The widespread impact over the spread of the coronavirus in Southeast Michigan will take a toll on the housing market. How that plays out will be felt by consumers and real estate agents alike with impacts ranging from possibly depressed inventory and home showings to fewer sales as a potential recession could dampen demand. News of the inevitable first confirmed cases in Michigan came last week with Gov. Gretchen Whitmer announcing late Tuesday that two people — one in Wayne County and one in Oakland County — had tested positive for COVID-19. The aftershock of that was felt around the state in things ranging from postponed athletic events, concerts and parades to universities mandating online-only classes and delayed resumption of school. Within 48 hours of the first cases being announced, the state’s confirmed number of patients started to rise. A handful of people immediately pulled their houses off the market, said Dan Elsea, president of brokerage services for Real Estate One. That was Wednesday, one day after the revelation of the first confirmed cases. By Thursday, that could’ve been 20 or 30, Elsea said, noting that it’s still a comparatively small number of homes throughout the Southfield company’s network. That’s a bitter pill to swallow. Inventory remains low, driving up prices. According to Farmington Hills-based Realcomp II Ltd., on-market listings fell 7.1 percent, from 19,561 in January 2019 to 18,170 in January this year. That helps put upward pressure on median sale prices, driving them up 9.6 percent from $155,100 in January 2019 to $170,000 two months ago. Total sales fell 3.7 percent from 4,837 to 4,656 during that same time period. See HOUSING on Page 29

See LIVENGOOD on Page 29

NEWSPAPER

CRAIN’S DETROIT ILLUSTRATION

The Conversation: Lon Johnson PAGE 18

Coworking in the era of coronavirus Page10

CRAINSDETROIT.COM I MARCH 23, 2020

THE CORONAVIRUS IN MICHIGAN

THE GREAT ADAPTATION

THE RESPONSE

DTE’s Anderson, other CEOs put together crisis playbook

SMALL BUSINESS

ECONOMY

Impact will be painful, but extent is uncertain

BY CHAD LIVENGOOD

BY DUSTIN WALSH

Gerry Anderson has never led a major utility company through a global pandemic. Nobody in Michigan has. But some of them had been wrestling with the coronavirus and its wide-reaching effects on commerce, global supply chains and the health and welfare of workers in their overseas operations for two months before the respiratory disease was detected in Michigan’s population. And now those companies — the likes of Lear Corp., Herman Miller, Steelcase, Dow Chemical and the Detroit 3 automakers — are sharing their experiences with other Michigan Anderson companies that have been scrambling over the past two weeks to try to sustain business operations amid a biological disruption of the economy. “Some of those companies have been able to step back and essentially assemble all of that learning into detailed books of instruction,” said Anderson, executive chairman of DTE Energy Co. “And that’s what we’re sharing with other companies. If you’re being slammed by this, you don’t necessarily have the time to put that together.” Anderson has been leading the effort through his role as chairman of Business Leaders for Michigan to share, develop and coordinate responses to the COVID-19 outbreak among Michigan’s largest business for everything from the best industrial cleaning agents to messaging to employees. Over the past week, Anderson has been convening a daily conference call with top executives at Lear, General Motors Co., Steelcase, Herman Miller, Stryker, Barton Malow, Dow Chemical, Quicken Loans, Meijer and others to pull together best practices and strategies for being both reactive and proactive to the upheaval this virus is having on workforces and the economy.

Before he dashed outside to deliver a customer a curbside food order, Caffè Far Bella co-owner Jack Palazzolo asked a longtime customer Thursday a routine question that elicited an unusual answer. “Do you need silverware to go?” he asked customer Toni Mazur inside the quaint St. Clair Shores cafe on Greater Mack Avenue. “Yes, because I’m going to eat inside the car instead of in here,” Mazur replied, pointing to her car parked out front, where Palazzolo was meeting customers who didn’t want to come inside to pick up their soup, sandwich and coffee orders. Businesses and customers alike across Michigan spent last week adjusting to the disruption to their business models and processes after Gov. Gretchen Whitmer ordered a vast array of businesses to close or severely restrict patrons in an unprecedented effort to combat the spread of coronavirus.

See ANDERSON on Page 16

See BUSINESSES on Page 16

Jack Palazzolo and his wife, Karen, spent last week trying to keep their coffee shop, Caffè Far Bella, afloat by offering curbside service and putting up signs on their windows saying they were still open. | CHAD LIVENGOOD/CRAIN’S

‘We won’t let you die’ Small businesses adapt to coronavirus upheaval BY CHAD LIVENGOOD

NEWSPAPER

Detroit’s Andrews on the Corner put out signs thanking patrons for their (carryout) support | LARRY PEPLIN FOR CRAIN’S DETROIT BUSINESS

U.S. auto production is grinding to a halt amid the deadly COVID-19 outbreak. General Motors, Ford and FCA US shuttered plants last week after reporting that workers tested positive for the virus. Only days prior, Wall Street stalwarts Goldman Sachs Group and JPMorgan Chase Inside declared a global reces- ` Economists sion. More than 55,000 weigh in on what unemployment claims indicators to were filed March 16-18 watch. Page 16 alone, with Goldman predicting 2.25 million claims last week across the U.S. University of Michigan economists are projecting Michigan unemployment as high as 10 percent in 2020 and as low as 5.6 percent depending on the success of social distancing and business closures. But the reality is that there is no stencil to follow. The modern, globally integrated economy has never faced a foe like COVID-19. There are too many questions left to answer to accurately predict the fallout: How long will we socially distance ourselves from neighbors, coworkers, friends? How many business sectors will be impacted and how hard? How many of your colleagues will get sick and how many will die? How will businesses traverse this new landscape and succeed on the other side? Will General Motors and Ford pivot as they did during World War II, and jumpstart the war machine? Will it save jobs or the economy? Southeast Michigan recorded its first three COVID-19 deaths by the end of last week: a man in his 80s, a man in his 50s and a woman in her 50s (the latter two with reported underlying health conditions). More deaths will likely have been recorded between the writing of this article and you reading it. But the economic sickness could linger far beyond the coronavirus. See ECONOMY on Page 16

LEADING THE BATTLE

KEEPING YOU INFORMED

Crain’s wants to tell the stories of people who are taking leadership in the fight against the coronavirus. That leadership could be from the true front-line workers in health care, who are risking their lives to save the lives of others. And we also want to tell the stories of others who are leading the charge in educating people and making creative moves in a time of economic disruption. Please send your stories to Managing Editor Michael Lee at malee@crain.com.

If you get your issue of Crain’s delivered at the office, you can also find a PDF version at www.CrainsDetroit.com/ this-week-issue. We are creating a special button there that will allow you to pass the issue along to other people, just like passing along the printed issue. Crain’s also has created a web page where nonprofits and business organizations can list their event cancellations and provide links to more information. We encourage readers to look at www.crainsdetroit.com/eventupdates.

THE CONVERSATION Robert Takla, chief of emergency medicine at St. John in Detroit, has never seen anything like the coronavirus crisis. PAGE 22

Racing to stop lake erosion PAGE 3

CRAINSDETROIT.COM I MARCH 30, 2020

THE COVID-19 CRISIS

DETROIT STEPS UP ONCE AGAIN Manufacturers make medical devices, gear; companies eye potential long-term pivot to medical BY DUSTIN WALSH

nonprofits who responded to a survey done last week by Michael Montgomery, a consultant and lecturer at University of Michigan-Dearborn, said they’ve already canceled events. Another 37 percent said they are considering it.

RCO Engineering typically manufactures interior components for General Motors, Lear and other automotive suppliers at its Roseville manufacturing campus. But now it’s making hospital face shields — ramping up from 3,500 per day Friday to 30,000 per day by April 2. RCO is one of 600 Michigan companies heeding the call to assist in the battle against the deadly COVID-19. The pivot to medical devices fills a desperate need for gear as nurses and doctors continue to perform their duties in deteriorating conditions — and for some companies is a way to keep themselves essential and keep operating. Last week, the state received a delivery of equipment from the national emergency stockpile, including 43,000 face shields and 95,000 N95 respirators, but it’s nowhere near enough, Gov. Gretchen Whitmer said in a press briefing on March 23. “... that allotment is barely enough to cover one shift at that hospital,” Whitmer said. “Not even a full day’s worth of shifts; one shift.” Southeast Michigan became the epicenter of the global outbreak last week with positive tests growing faster than anywhere else, local hospitals were overwhelmed and critical equipment shortages rampant. Meanwhile, the newly declared “Arsenal of Health” began shipping parts and fully assembled and manufactured personal protective equipment to hospitals around the state.

See FUNDRAISERS on Page 20

See ARSENAL on Page 20

Eric Yelsma of Detroit Denim presses plastic for face shields for COVID-19 responders. | BRENNA LANE

Spring fundraiser cancellations spur cash crunch Nonprofits scramble to figure out how to make up revenue; events could crowd 2nd half of year BY SHERRI WELCH

The cancellation of spring nonprofit fundraisers and closures associated with the COVID-19 outbreak are translating to cash flow concerns and a crowded calendar for the second half of the year. Some human service agencies,

arts groups and other nonprofits have canceled events outright. But many are pushing them out into the second half of the year. That could lead to some events getting lost in the throng. And the resulting loss of revenue could irreparably harm some nonprofits that were already operating on extremely

FOCUS | FAMILY-OWNED BUSINESS

GROWING UP  How three family-led companies scaled their operations. PAGE 10

NEWSPAPER

tight budgets with little reserves. A 2018 State of the Nonprofit Sector Survey, which got responses from nearly 3,400 nonprofit leaders across the country, reported that only a quarter had six months of cash on hand. And 19 percent said they had a month or less of cash on hand. Here in Michigan, 55 percent of 63

RETAIL

Van Elslander bids to buy back Art Van brand Offer made to bring at least the store’s name back in the family BY KURT NAGL

It might not be the end for the Art Van brand after all. Gary Van Elslander on Wednesday submitted a bid to buy the Art Van brand name and trademark, according to multiple sources familiar with the situation. The bottom fell out swiftly for Art Van Furniture Inc. earlier this month. It filed for Chapter 11 bankruptcy March 9 and announced its liquidation would last around two months. Operations

across all its stores ended abruptly 10 days later as the coronavirus outbreak took hold of the region. Art Van Furniture was acquired in 2017 by Bos- Van Elslander ton-based private equity firm Thomas H. Lee Partners LP for an estimated $550 million. The Art Van trademark is owned by its credi-

tors Hilco Merchant Resources LLC, based in Illinois, and FS KKR Capital Corp., based in Pennsylvania. Any purchase would need to go through the bankruptcy approval process, expected to wrap up around the end of April. Van Elslander's bid was for less than $1 million. The exact amount was not disclosed but will eventually be made public as part of the bankruptcy proceeding records. See ART VAN on Page 18

CRAIN’S MICHIGAN BUSINESS: THE FOOD ECONOMY

The Zingerman’s effect: How a small Jewish deli launched a unique network of food entrepreneurs PAGE 8

CRAINSDETROIT.COM I APRIL 6, 2020

COPING WITH COVID-19

NOT REMOTELY EASY DO’S AND DON’TS OF WORKING FROM HOME For many of you, the social distancing forced by the coronavirus emergency means it’s the first time you’ll be working at home for an extended period. Here are some tips to ease that transition. Start and end your day with a routine: Getting dressed, eating breakfast or taking a brisk walk before diving in can help you focus. An after-work routine (think coffee or glass of wine, or another walk outside) is a critical signal that the workday is over and homelife begins. Maintain a dedicated workspace: Establish a tangible boundary to maintain the separation between work time and home time, and so that you don’t waste energy getting physically set up every day. Use a VPN: Some employers have their own VPNs for remote use, but if yours doesn’t, VPN software is readily available and a good security precaution for both work and personal data.

Minimize online time: While social media is a great way to keep tabs on friends, family and colleagues, remember to carve out a small period to deliberately disconnect. Close the laptop. Turn off the phone. Studies show too much social media is bad for mental health, after all. Manage expectations: Understand that there will be a learning curve with new communication tools, virtual meetings, rethinking paths to access to information and the like. Be clear about what can be accomplished from home. Overcommunication is key. Finally, be candid about what works, what doesn’t and what you need to get the job done.

Learn teleconferencing etiquette: The mute button is your friend, especially in a house full of kids, a partner also working from home or noisy pets. Don’t fear the webcam; videoconferencing can offer visual clues as to how ideas are accepted, but do make sure there’s nothing in your camera’s view that you wouldn’t want to share with a colleague or customer.

NEWSPAPER

BY CHAD LIVENGOOD

The closure of public and private school buildings through June for 1.61 million Michigan schoolchildren will likely wreak continued havoc on workplaces and productivity as parents will be doing double duty as someone’s employee and their child’s teacher. And that’s only if they can perform their job remotely from home. The deadly coronavirus pandemic that’s forced Michigan workers with nonessential jobs like selling mort-

gages for Quicken Loans Inc. or doing accounting work for Little Caesars Pizza has upended the traditional corporate headquarters work setting. The specter of manufacturing employees being unable to return to work in May or June because of a lack of child care will make resuming production “a little more difficult,” said John Walsh, president and CEO of the Michigan Manufacturers Association. See SCHOOLS on Page 16

Pandemic leads to new moment for remote work Working from home goes mainstream BY NICK MANES

Call it the “Great Experiment.” For many burgeoning industries, especially in the startup technology space, work from home is nothing new. Employees text “WFH” to their boss and go about their day, working in pajamas and taking necessary meetings by conference call. But for many traditional companies, work from home ranges from the occasional exception to never allowed. Until now. The onset of coronavirus and the social distancing requirements that come with it have led companies to scatter their large workforces all

Take breaks; allow for personal time: Set an alarm or timer to remind you that it’s time to get up, stretch, grab a coffee, leave the house or head to the kitchen. Your eyes and your brain need those short moments away. If your job responsibilities allow, turn email notifications off overnight. Maintain relationships: At the office, you’d take a few minutes here or there to chat with your coworkers. Keep that going via social media, Slack or some other means of staying in touch.

With Michigan schools out, businesses grapple with productivity woes

DAVID KORDALSKI/CRAIN’S DETROIT BUSINESS

Show us your work-at-home space Does your new working-from-home reality mean a dedicated home office or just a laptop, your cat and your couch? Whatever it is, we want to see it. Please email photos of your setup, your name and a few words about your job and how remote work is working out to bvalone@crain.com. We’ll share the best in an upcoming feature.

around the region in recent weeks. With that change comes new challenges — from installing proprietary technology in people’s homes to maintaining long-developed corporate cultures to ramping up employee engagement initiatives at a time of great stress for all. Take, for instance, Pontiac-based mortgage loan-originator United Shore Financial Services LLC. Known for its sprawling headquarters on two sides of South Boulevard, the company now has two buildings soon to be conjoined by a 1,000-foot pedestrian bridge connecting the facilities. See REMOTE on Page 16

Organ transplants slow as COVID-19 heats up BY JAY GREENE

Patients, one by one, are getting calls from transplant center hospitals in Michigan and elsewhere telling them their organ transplants have been delayed, essentially called off except for life-threatening emergencies during the coronavirus crisis. The reasons are varied, but mostly, doctors say, it is to protect patients who are at a higher risk of infection from contracting the virus. Other rea-

sons include fewer live organ donations, shortages of blood, plasma, staff, supplies and equipment, including mechanical ventilators. Even before COVID-19 began infecting people in the U.S. in February, transplants of kidneys, liver, lung and heart, bone marrow and stem cells could easily get derailed. A donor backs off. A recipient is too ill. Or the body rejects the organ. See TRANSPLANTS on Page 15

CHAINSAWS AND HOPE: Prison-to-work program starts to show results. PAGE 3

THE CONVERSATION Mary Lynn Foster returned home to Michigan to lead the American Red Cross Michigan as regional CEO. PAGE 19

CRAINSDETROIT.COM I APRIL 13, 2020

COPING WITH COVID-19

CRISIS WIDENS CRACKS IN HEALTH CARE SYSTEM Anxiety still heavy as PPP enters 2nd full week

As coronavirus cases surge, hospitals are brought to the brink BY JAY GREENE

BY NICK MANES

By all accounts, the $350 billion Paycheck Protection Program has noble intentions: a lifeline to small businesses and their employees hit hard by the financial impact of COVID-19. But complaints abounded last week of banks having problems getting applications processes in place and functioning and dealing with more demand than they’ve ever seen. And professional service providers like lawyers and accountants are two weeks into the program and still lack clarity on basic definitions of who may or may not be eligible. The federal program, administered by the Small Business Administration, provides forgivable loans to businesses of under 500 employees that can be used on regular costs of doing business such as paying rent, mortgages and utilities, as long as those businesses keep their employees on the payroll for at least eight weeks. It doesn’t matter whether the business is open or not. But the scale of the problem — making up for the commerce halted to slow the disease’s spread — coupled with the similar scale of the solutions on offer has led to some horror stories. “I think the fact that this is spread out over so many banks, so many industries, and the fact that virtually everyone will be applying for (loans) that qualifies, you’re going to have some good, bad and ugly stories, and the challenge is, when you put things through this quickly, there are certain uncertainties,” said Tim Hilligoss, a shareholder in the Southfield-based small and middle-market accounting firm of Clayton and McKervey PC. See PPP on Page 16

Vineet Chopra, M.D., consults with Michael Mageli, R.N. (center), and Katherine Klug, R.N., at University Hospital in Ann Arbor Chopra expects the virus to reach peak impact on hospitals over the next two weeks. | MICHIGAN MEDICINE

As the COVID-19 pandemic moves into high gear in Michigan, thousands of frontline hospital workers are facing increasing stress, fatigue and frustration going into the second month of the public health crisis that is projected to kill more than 2,000 in the state over the next several weeks. Despite a growing number of recovered patients and those able to come off mechanical ventilators, many health care workers have taken to social media to express their anger at how government and the health care delivery system have proven insufficient to deal with the growing human catastrophe. The COVID-19 pandemic has exposed flaws and vulnerabilities in how government responds to pandemics and how hospitals staff, supply and deliver health care to populations they serve. And the results have been deadly. Systemic changes will be required to avoid a similar future catastrophe, experts tell Crain’s. See HOSPITALS on Page 17

FACING THE FLAWS OF THE UNEMPLOYMENT MAZE William Blunt

Katie Kelsey

Christina Otto

Jessica and Jon Robertson

Christopher Sanders

Jori Trelfa

Lauren Waters

Unprecedented surge in filings leads to flood of problems BY CHAD LIVENGOOD

They’ve called. They’ve logged in. They’ve even faxed. But they still can’t break through. Even as more than 800,000 Michigan workers have claimed unem-

ployment benefits, there are an untold number of jobless workers who have not been able to file after four weeks of business shutdowns due to the coronavirus pandemic that has swept across the state. Their troubles are all the same: The state’s unemployment filing sys-

tem is down, the phone system puts them on hold for hours on end or hangs up. Several jobless workers report spending their days quarantined at home and redialing the Unemployment Insurance Agency’s hotline number all day long. “Calling and getting ahold of any-

one is absolutely next to impossible,” said Jessica Robertson, a wedding photographer from Northville whose line of work has been wiped out until September by a collapse of the in-person events business. See FLAWS on Page 16

FOCUS | WOMEN IN SKILLED TRADES

NEWSPAPER

ROOM TO IMPROVE  From welders to carpenters to electricians, more women are joining the skilled trades, but their numbers are still low. PAGE 8

THE CONVERSATION Co-founder and CEO of Detroit City FC Sean Mann is good with neighbors and committed to kicking a ball this year.

Nonprofits: Need for PPE has jump-started a sewn goods training hub. PAGE 3

PAGE 22

CRAINSDETROIT.COM I APRIL 20, 2020

COPING WITH COVID-19

HOW CORONAVIRUS CHOPPED THE FOOD CHAIN Comerica Bank faces backlash over PPP Bank never got ‘portal’ off the ground before money ran out BY NICK MANES

even with non-regulars. “I offer more than just product,” said Brancato of Washington Township. “I offer service and an old way of doing things ...” With backlogs for mainstream grocery delivery and curbside operations like Instacart and Kroger Pickup, local companies like Brancato’s are helping pick up slack for households across the region. But they generally don’t have the resources to meet demand, either.

While the meat cases at many local grocers are barren, a glut of bacon is piling up in refrigerated storage across warehouses in the U.S. Dairy farmers are dumping milk from their silos, cattle auctions are shut down and crop farmers don’t know if fruit and vegetables will be picked this year. People aren’t consuming fewer calories — some of us are consuming more — but where those calories are being consumed is creating challenges. More than 50 percent of food purchases occurred outside the home prior to the COVID-19 outbreak at restaurants, schools and sports arenas, according to U.S. Department of Agriculture data. With those outlets closed down, America’s complex food system is scrambling to adjust.

Trouble getting loans processed for the federal Paycheck Protection Program has Southeast Michigan business owners furious at a long-standing financial partner and looking to take their banking business elsewhere. Batch Brewing Co. founder and co-owner Stephen Rogison has had a generally positive working relationship with Comerica Inc., the Dallas-based bank and Michigan’s second-largest financial institution. Rogison opened his Detroit brewery in Corktown in 2015 with the help of a Small Business Administration 7(a) loan done by Comerica Bank. His business won the bank’s Hatch Detroit small-business pitch competition two years earlier. Rogison even served on the board of the Hatch Detroit program before resigning Friday. “I’ve long been an advocate for Comerica and their commitment to small business in Detroit,” Rogison said on Friday. That’s all changed. Like many other small business owners Crain’s spoke with, Rogison said he feels that the bank has left its customers out in the cold due to an inability to get a promised automated portal off the ground to process the groundswell of Paycheck Protection Program applications for potentially forgivable loans for struggling small businesses.

See SPECIALTY on Page 21

See FOOD CHAIN on Page 20

See PPP on Page 18

The beef industry has shifted to more versatile cuts and the supply chain has shrunk due to worker constraints caused by COVID-19. | FARM NEW MEDIA

Getting the right food to the right place a complex problem

The milkman now has more business than he can handle BY ANNALISE FRANK

As time slots fill up fast for mainstream grocery delivery and pickup, more households are turning to long-standing local sources for food essentials during the coronavirus outbreak. Take, for instance, the milkman. Steve Brancato of Old Fashioned Country Dairy, a one-man operation that still delivers milk in reusable glass bottles, calls himself a bit of a “dinosaur.” But his 43-year-old business is in high demand now,

NEWSPAPER

BY DUSTIN WALSH

FOCUS | MACOMB COUNTY REAL ESTATE  New retail reality: Hall Road and other shopping centers face a changing landscape amid COVID-19. PAGE 10 Industrial resurgence: An uptick in demand for industrial space may signal the sector is poised for a rebound. PAGE 11

THE CONVERSATION Connaé Pisani, founder of National Real Estate Management Group. PAGE 27

Editorial: New racial disparities task force can save lives. PAGE 8

CRAINSDETROIT.COM I APRIL 27, 2020

COPING WITH COVID-19

PLANNING FOR THE POST-LOCKDOWN WORKPLACE

I hear everybody from President Donald Trump to Dr. Anthony Fauci to Gov. Gretchen Whitmer to four doctors with whom I have been consulting tell me we Jay need more tests to GREENE feel safe in public gatherings, to get back to work or get a haircut, to go to the health club, to go to the dentist, or get on an airplane and even travel to Florida to hit the beaches. Oh, my, what thoughts. But what do more tests mean if nobody can count on the results being accurate? In other words — if you don’t trust them? Take, for example, my wife Olya, a health care worker who was exposed to coronavirus in mid-March. I’ve written previously about her three positive COVID-19 tests (March 30, April 8 and her latest on April 21), and her one positive serologic coronavirus antibody test (March 14). All tests were conducted during a 21day period. She firmly believes she was exposed on March 16 at her hospital in Detroit and started exhibiting strong symptoms of fever, chills and shortness of breath on March 21. This means she has probably been positive for at least 31 days, much longer than the 14 days doctors originally believed was possible. Some doctors are saying coronavirus can stay within our bodies for 35 days or more. At this point, she feels recovered and is asking about donating what she hopes is coronavirus antibody-filled blood plasma to those still suffering. Wayne State University and other researchers are studying this, but people must first answer a series of questions, including having proof of a negative COVID-19 laboratory test. See TESTS on Page 25

BY DUSTIN WALSH

A subset of executives from Roush Industries Inc. meets — virtually — twice a day. The purpose of the newly established task force is to wade through the rapidly evolving information, recommendations and mandates linked to the COVID-19 response and adjusting its own protocols. Right now, the Livonia-based engineering firm’s roughly 50 build-

See RETURN on Page 24

Black and blue: Universities take financial battering Schools make contingency plans for fall classes as they wrestle with revenue hits BY KURT NAGL

More than a month after the coronavirus pandemic closed campuses across Michigan, universities and colleges remain in triage mode. Their focus has shifted from the

NEWSPAPER

ings are only open to around 300 of its 3,000 employees and 2,000 contractors. Those select employees are working on deemed-essential work in aerospace, defense and medical programs. The massive reduction in employees, which included layoffs, during Gov. Gretchen Whitmer’s stay-at-home order makes keeping workers distanced easier, and makes performing temperature screenings and health surveys easier.

ILLUSTRATION BY BJORN RUNE LIE/GETTY IMAGES

Why testing may not be ready for prime time

Managing a return to work brings some devilish details

safety of staff and students to the health of the business. With hundreds of millions of dollars being hemorrhaged, and further financial hardship looming with the threat of declined enrollment and cuts in state aid, the prognosis is bleak.

“Virtually every source of revenue is going to be hit and potentially hit hard,” said Dan Hurley, CEO of the Michigan Association of State Universities. The University of Michigan said anticipated losses will range from $400 million to $1 billion through

the end of the year. Michigan State University said losses have so far totaled between $50 million and $60 million. The financial impact is likely to be more devastating for smaller schools. See UNIVERSITIES on Page 24

FOCUS | VENTURE CAPITAL REPORT  The COVID chronicles: As the fast-paced venture capital world shifts online, we asked several investors what their days look like. PAGES 10-11

TWENTY IN THEIR 20S INSIDE: MEET THE EXTRAORDINARY YOUNG PEOPLE WHO MAKE UP THE CLASS OF 2020. PAGES 10-17

THE CONVERSATION

Doing more than their share: How Michigan banks punched above their weight on PPP small-business help. PAGE 3

 State medical society president: ‘Coronavirus is where my mind is right now.’ PAGE 22

CRAINSDETROIT.COM I MAY 4, 2020

COPING WITH COVID-19

Advocates push for data as crisis hits nursing homes Not all nursing homes have reported COVID-19 data as state tries to assess impact BY ANNALISE FRANK

Shirley Bacholnik didn’t have much to do besides lay in her nursing home room and think about how she may die without seeing her family again. “It just spread and there’s nothing

Tales from the (child care) front: Juggling in the Age of COVID

anybody could do,” the 69-year-old resident of ShorePointe Health & Rehabilitation Center in St. Clair Shores said. “We had no choice but to sit here and take it.” Bacholnik watched as the coronavirus spread through the nursing home on Jefferson Avenue near the

lakeshore, eventually making her one of the more than 50,000 confirmed U.S. COVID-19 cases in longterm care facilities. The pandemic has taken an outsize toll on the vulnerable population of live-in facilities for the elderly like nursing homes. The state of Michigan

Need to know ` State of Michigan releases data on COVID-19 cases in nursing homes ` Data lacks context needed describe how hard-hit these facilities are ` Detroit tests all nursing home residents

Business of child care suffers crisis of its own BY DUSTIN WALSH

The worn-down corners of toy cars and cherry-scented markers are hardly touched, but cleaned twice as often. The doors are locked and everyone is dressed to play cops and robbers, but with no cops because everyone is wearing a mask. At Learning Tree Child Care Center in South Lyon, nothing is as it was before COVID-19. Learning Tree’s five locations across metro Detroit see a total of 25 kids daily, down from near 700 before Gov. Gretchen Whitmer’s “Stay Home” order on March 24 closed day cares to nonessential-employed parents — they are allowed to remain open to serve essential workers and first responders. Children are met at the door, getting a health questionnaire and temperature check before entering the building. While most day cares around the country — roughly 60 percent — are closed, according to an April 10 survey by the Bipartisan Policy Center and Morning Consult, Learning Tree and others remain open. Learning Tree Child Care Center in South Lyon has remained open but with far fewer children . | LARRY PEPLIN FOR CRAIN’S DETROIT BUSINESS

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See NURSING HOMES on Page 18

For day cares — and parents — a waiting game

Our days begin with a negotiation. Before our 2-year-old son wakes up, we pour some coffee, open our laptops and try to figure out whose job is more imAmy portant that day. ELLIOTT We consider BRAGG whose 10 a.m. call needs real attention, and who can half-listen to a conversation while manning the Roku remote and trying to translate our son’s demanding yelps into precisely which “5 Little Monkeys” video on YouTube he wants to watch. Whose deadlines will gnaw harder in the middle of the night if not met? Which of us owes the other a little extra time this week? We split up the day into roughly two-hour blocks, but sound carries in our small house. Every day, my husband’s co-workers overhear me say things like, “It’s time for mom to go pee on the potty, do you want to come too?” See BRAGG on Page 20

on April 24 began reporting resident testing figures for nursing homes. Advocates have complained of a lack of adequate data as the coronavirus crisis hits nursing homes especially hard.

See DAY CARE on Page 20

FARMERS TO FAMILIES  Food Box Program sets out to create distribution program from scratch in weeks, aims to enlist food-service giants in ambitious plan to feed hungry. PAGE 3

Michigan Business: Ag team targets commercializing morel mushrooms. PAGE 12

THE CONVERSATION Agricultural economist Trey Malone studies what’s at stake for Michigan’s food economy under COVID-19. PAGE 22

CRAINSDETROIT.COM I MAY 11, 2020

COPING WITH COVID-19

BURNING THROUGH SAVINGS

Michigan was recession-ready — but not for this

In March, Michigan had $4.6 billion in reserves in its unemployment trust fund, making it the most-funded social safety net for workers among Great Lakes states and the nation’s 10 most populous states. Only Oregon ($5 billion) and Washington state ($4.78 billion) had more cash in their unemployment trust funds and those states have much more generous weekly benefits of $648 and $790, respectively. Michigan’s maximum weekly benefit is $362.

State unemployment insurance trust fund value More than $5B

$3B to $4B

$1B to $2B

$4B to $5B

$2B to $3B

Less than $1B

Washington Montana

Vermont

North Dakota

Oregon

Maine

Minnesota

New Hampshire

South Dakota

Idaho

Wisconsin

Wyoming

Michigan

Utah

Illinois

Indiana

Kansas

Missouri

West Virginia

New Mexico

Delaware Maryland Virginia

Kentucky North Carolina

Tennessee

Oklahoma Arizona

New Jersey

Ohio

Colorado

California

Rhode Island Connecticut

Pennsylvania

Iowa

Nebraska

Nevada

Massachusetts

New York

Up North tourism feels squeeze of slowdown

Lockdowns will start to hurt this month BY TOM HENDERSON

Even in the bigger northern Michigan cities, it can sometimes seem as if the coronavirus pandemic is a distant worry. Still, Gov. Gretchen Whitmer’s announcement that she was dividing the state into eight regions, based on the impact of COVID-19

More tourism, pages 20-21

South Carolina

Arkansas Mississippi Alabama Texas

Georgia

Louisiana Florida

Alaska

Hawaii

Map Data from ©HERE/MAPS4NEWS CRAIN’S DETROIT BUSINESS GRAPHIC

How Michigan compares...

$4.6B unemployment cushion won’t last long

... to the top 10 largest states

Fund, one of healthiest in country, would run dry by August

California (1) Texas (2) Florida (3)

$450 $521 $275

New York (4) Pennsylvania (5) Illinois (6) Ohio (7) Georgia (8) North Carolina (9) Michigan (10)

$504 $572 $484 $480 $365 $350 $362

BY CHAD LIVENGOOD

In the decade since the Great Recession, Michigan employers built up one of the healthiest unemployment insurance funds in the country. But even $4.6 billion might not be enough to withstand the onslaught of coronavirus shutdown-induced job-

less claims from quickly bleeding the fund dry. Michigan’s unemployment trust fund, which took nine years to build up, could be drained in a matter of six months if nearly 1 million jobless workers draw benefits for an average of 19.4 weeks, according to a new analysis from the W.E. Upjohn Institute for Employment Research.

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INSIDE ` State looks to push work share programs, which are juiced by extra federal money. Page 18

Michigan entered the coronavirus pandemic’s economic upheaval with a better-funded unemployment insurance trust fund than any of the nation’s 10 most populous states and far ahead of its Great Lakes peers. A Crain’s analysis shows that Michigan’s $4.6 billion unemployment fund had more cash on hand at the outset of the public health crisis than Ohio, Indiana and Illinois combined — and twice as much savings as New York state before the pandemic shut down America’s largest city. See UNEMPLOYMENT on Page 18

State (population rank)

Maximum Trust fund weekly value as of benefit 1/1/20

$3,260,789,629 $1,934,397,487 $4,071,519,600 $2,651,482,639 $3,435,423,679 $1,946,242,074 $1,264,072,100 $2,559,981,541 $4,003,197,955 $4,661,100,963

... and to other Great Lakes states Great Lakes states

Maximum Trust fund weekly value as of benefit 1/1/20

Michigan Wisconsin Illinois

$362 $370 $484

Minnesota Ohio Indiana

$740 $480 $390

SOURCE: U.S. DEPARTMENT OF LABOR

$4,661,100,963 $1,971,405,287 $1,946,242,074 $1,705,263,924 $1,264,072,100 $895,342,153 CRAIN’S GRAPHIC

` Mackinac Island battens down the hatches for a rough ride ` Northern Michigan winery owners depend on online sales, national distribution channels

around the state, was greeted with relief by those in the northern Lower Peninsula and the Upper Peninsula. There are no lines to get into the Costco in Traverse City, where there are pallets of toilet paper lining one wall. Except for hand sanitizers and disinfectant products, the shelves at Meijer stores are well stocked, with babyback ribs, hams, steaks, trout and salmon in large supply, and little evidence yet of a rumored breakdown in the supply chain for meat. So far, the timing of stay-at-home restrictions has been forgiving for northern Michigan. Ski resorts were winding down their season in March and didn’t take much of a hit. Whitmer’s decision in late April to allow golf courses to open came just about the time tourist courses at Treetops in Gaylord, Boyne Highlands in Harbor Springs and Crystal Mountain in Thompsonville were scheduled to open, anyway. See TOURISM on Page 20

Women in Leadership: Mayor of Pontiac Deirdre Waterman

The Conversation: Ken Coleman finds inspiration in challenging times. PAGE 18

PAGE 12 CRAINSDETROIT.COM I MAY 18, 2020

COPING WITH COVID-19

Lear CEO Scott talks rebooting ‘It’s not a one-sizefits-all strategy’ BY DUSTIN WALSH

I stepped out of the rain into a black tent where a masked man thrust a pair of grill tongs in my direction. Pinched at the end was a fresh basic surgical-grade mask. A thumbs up signaled to the next masked man that I had not knowingly been in contact with a person infected with COVID-19, nor was I experiencing any symp- Dustin toms. My temperature was taken and I was per- WALSH mitted to enter the facility. I returned to work Thursday. Not Crain’s office in Detroit, but Lear Corp.’s just-in-time seating plant on Flint’s historic Buick City site.

When auto supplier Lear Corp. penned and then published its “Safe Work Playbook” on April 6, the idea of returning to work in Michigan seemed a distant reality. The state’s daily COVID-19 numbers remained on the Scott rise, recording more than 1,500 new cases and 110 deaths. The curve was not going to flatten for another three weeks. The company has suffered casualties. At least 13 people died from an outbreak at its plant in Juarez, Mexico. Others have fallen ill across plants in the U.S. prior to Lear shutting down operations last month. But Lear had reopened plants in China, including four locations in the epicenter of Wuhan, two weeks earlier in late March and would reopen plants in South Korea, Italy, Spain and Germany throughout April. Lear released an updated version of its playbook on April 27. The 80-page document is the culmination of what it learned and how it implemented health protocols and created a framework to reopen plants and do so with employee safety at the forefront. Those protocols include strenuous cleaning regimens, temperature checks, plexiglass guards in high-traffic areas and more. The company is even testing new technologies, such as thermal cameras that can monitor employees’ temperatures on the shop floor in real time.

See WALSH on Page 16

See SCOTT on Page 17

GOING THE DISTANCE ON RETURNING TO WORK Employees Teresa Frelix, left, and Douglas Dantzler listen at a safety procedure training at Lear Corp. in Flint, which restarts production Monday. | SARAHBETH MANEY/MLIVE.COM/THE FLINT JOURNAL VIA AP

Answers to burning restart questions BY DUSTIN WALSH

With manufacturers ramping up and the potential for office workers and some broader definition of retail allowed in coming weeks, the prospect of employees passing through doors into work is daunting. The new paradigm under pandemic means much more work and much more expense for employers. And most companies have questions about the logistics of keeping employees safe. Those questions

are basic yet critical to the goal of balancing work and, well, living. We consulted experts to answer some of the trickier questions below and provide guidance on the “new normal.” If you have other questions, email Dustin Walsh at dwalsh@crain.com, and we’ll answer them in coming weeks.  Should I clean my facility before workers return even if an employee never tested positive? See QUESTIONS on Page 16

NEWSPAPER

Putting faith in protocols: Lear’s playbook in real life

FOCUS | REAL ESTATE  City Living Detroit’s owner Austin Black II talks about home buying and how stay-at-home order could end popularity of open floor plans. PAGE 9

COVID-19 HEROES: Sabina Valenzuela rises to the occasion to help others. PAGE 6

TAKING ON TCF How Lynn Torossian created a hospital from scratch. PAGE 26

CRAINSDETROIT.COM I MAY 25, 2020

Crain’s Private 200 is here This week, Crain’s unveils our annual ranking of the biggest of the big privately held companies in Southeast Michigan. The ranking, the single largest data-gathering effort that Crain’s undertakes, ranks the companies based on annual revenue and offers the most complete snapshot of business in Southeast Michigan that’s available.

There’s even more available for subscribers who upgrade to an Enhanced Membership — data on hundreds of more companies, executive names and contacts and more, all available in Excel spreadsheets or a PDF format. To see the rankings, check out Pages 15-21. And if you’re interested in getting more from the data, check out crainsdetroit.com/membership.

COPING WITH COVID-19

DINING IN THE STREETS?

Coronavirus-era restaurant limits spur al fresco push BY ANNALISE FRANK

This summer Michiganders won’t be packing into their favorite brunch spots, but they could be pouring out onto streets and sidewalks. Some cities, restaurants and advocates are following those in other states, turning to expanded outdoor dining. It’s a way for eateries limited by coronavirus restrictions to seat more customers and make more money. Birmingham and Plymouth are among local governments that have taken action. The northern Michigan tourist haven of Traverse City is studying a partial closure of its popular Front Street to draw patrons to its restaurants, bars and breweries during a summer vacation season rife with economic unknowns. While it’s not proven, experts have indicated the coronavirus spreads more easily indoors. So why not take up some space in a parking lot, in front of your store or on the street? See DINING on Page 23

Traffic proceeds down Front Street in downtown Traverse City last week. | CHAD LIVENGOOD/CRAIN’S DETROIT BUSINESS

FOCUS | BUSINESS EDUCATION

COVID AND THE MBA Area colleges brace for possible enrollment declines. PAGE 10

NEWSPAPER

The post-COVID-19 office: one-way stairwells, extra cleaning, no deli spreads BY KIRK PINHO

When office workers start returning to their desks — whenever that may be — the office environment will look and feel much different. Elevator space will be at a premium as social distancing measures remain the norm, making life on the upper floors of high-rises and skyscrapers somewhat of a nightmare. Stairwells will be converted to one-way only. Turbocharged cleaning by janitors and day porters will be instituted, as will limited use of gym

and kitchen space in some buildings that provide those. And you can probably kiss goodbye those shared deli spreads, for now at least, out of an abundance of caution. Some companies will stagger their workforce so half works in the office a few days, followed by a day of deep cleaning, then the other half of the staff works in the office the other few days. “Almost the country club technique where it’s shut down on Mondays for cleaning,” said Timothy Gawel, leader of the workplace sector for Southfield-based architecture

and design firm Harley Ellis Devereaux Corp. In short, at least for the time being, nothing will be as it was prior to the first confirmed COVID-19 cases in Michigan March 10. The Detroit area has 77.8 million square feet of office space, according to the local office of brokerage house Newmark Knight Frank, and very little of it will look as it did three months ago, before more than 5,000 Michigan residents lost their lives to the virus. See OFFICES on Page 24

THE CONVERSATION Detroit City Council President Brenda Jones on life with COVID-19. PAGE 22 CRAINSDETROIT.COM I JUNE 1, 2020

INSURANCE

No-fault redo has agents scrambling

PAGES 10-15

COPING WITH COVID-19

CAN’T STOP THIS Business doesn’t stop for startup execs during crisis. But it sure changes.

In a month, coverage will look very different BY CHAD LIVENGOOD

Auto insurance carriers and agents in Michigan have staked out a new line of business selling motorists extra liability coverage in case they are sued by an injured driver who opts out of unlimited medical coverage under the new no-fault law that takes effect next month. Insurance agents are selling socalled “umbrella” policies for bodily injury claims, an added layer of protection once Michigan’s law no longer requires all motorists to carry the same limitless Personal Injury Protection, starting July 2. “We’re seeing a huge increase in umbrellas,” said Milene Plisko, a Livonia-based district manager for Farmers Insurance Co. “We’re going to have a lot of people who are woefully underinsured, and they’re going to have no recourse but to sue to recover what’s not covered.” The emerging trend of motorists buying an additional layer of insurance may eat away at the savings on Personal Injury Protection they were promised by lawmakers a year ago when Gov. Gretchen Whitmer signed into law a sweeping overhaul of Michigan’s 47-year-old auto insurance law. The cornerstone of the new law seeks to rein in Michigan’s highest-inthe-nation auto insurance rates by imposing a fee schedule on medical providers who care for injured drivers and then allowing motorists to choose different levels of PIP coverage. Those coverage levels include $50,000, $250,000 and $500,000 of PIP, resulting in average mandatory rate reductions on the PIP portion of a driver’s premiums of 45 percent, 35 percent and 20 percent, respectively. See INSURANCE on Page 20

From left: Jasnik Parmar, Seth Killian, Sassa Akervall, Jessica Willis and Michael Healander | CONTRIBUTED

BY NICK MANES

s the economic uncertainty from the coronavirus pandemic lingers, founders of Southeast Michigan startup companies are, like everyone else, wondering what’s next. Late May data from research firm Global Data shows that venture capital funding, the lifeblood of most any growing startup, has slowed down significantly in recent weeks,

` SASSA AKERVALL, CEO OF AKERVALL TECHNOLOGIES There was only about a week of downtime for Akervall Technologies Inc. before a major shift in production took place. For nearly a dozen years, the Saline-based company has manufactured mouth guards for athletic and medical uses. See STARTUPS on Page 21

HEALTH CARE

Hospitals help employers with testing, screening Henry Ford, Beaumont among systems guiding firms on safe work environments BY JAY GREENE

Henry Ford Health System and Beaumont Health are two of several health care organizations helping companies safely return to work by testing workers for COVID-19 on a voluntary basis.

NEWSPAPER

dropping 5.5 percent in March from the previous month. Higher-value deals of $10 million and above have taken the biggest hit, according to the report. That tends to ring true to executives at five early-to-middle stage companies in Southeast Michigan, many of whom have ongoing talks with the venture capital community. For them, business life hasn’t stopped — it’s just gotten very different.

As more Michigan employers begin to ramp up operations after shutdowns ordered by the state due to the coronavirus pandemic, creating safe work environments for employees has been a major priority. While mandated COVID-19 testing of employees is not recommended by the Centers for Disease Control and Prevention as part of a return-to-work plan, the U.S. Equal Employment Opportunity Commission in late April said employers can require employees to be tested before they are allowed to enter the workplace, even if they do not exhibit symptoms of the virus, and not run afoul of the federal Americans with Disabilities Act. See HOSPITALS on Page 17

A Henry Ford health care worker tests a DTE employee at Fermi II nuclear power plant for COVID-19. DTE began working with Henry Ford Health System in mid-April to test work groups critical to energy production and delivery. | MARK HOUSTON

THE CONVERSATION Andrew Blake on Blake Farms’ growth during pandemic and wholesale business coming this fall. PAGE 104

Sanford tries to rebuild after flood PAGE 3

CRAINSDETROIT.COM I JUNE 8, 2020

SOCIAL UNREST

MUCH TO OVERCOME As Detroiters take to the streets, economic inequality comes into focus

A protester listens Thursday during a rally in Detroit over the death of George Floyd, who died May 25 after being restrained by police in Minneapolis. | PAUL SANCYA/AP

Dustin

WALSH

Detroit boiled over last week as protesters took to the streets for mostly nonviolent demonstrations against police brutality. But the cries of racism extend long past policing policies in a city where recent health crises and economic recovery then fallout have been uneven. Black Detroiters represent 1,138, or 81.8 percent, of the 1,392 COVID-19 deaths in the city as of Friday. After years of paltry gains in income — only 12 of Detroit’s 297 neighborhoods are considered middle class — the coronavirus recession decimated black communities. The unemployment rate of Detroit, which is 77 percent black, climbed to 38.5 percent in April from 7.6 percent in February prior to the outbreak. See INEQUALITY on Page 102

INSIDE

 Businesses that boarded up underscore a complex reality for black-owned businesses in Detroit. PAGE 102

COPING WITH COVID-19

Restaurants get creative to reopen, while others opt to delay dine-in service BY ANNALISE FRANK

When restaurants in Michigan are allowed to reopen Monday, some will throw open their doors while others will wait weeks or months out of safety or staffing concerns. When they do restart dine-in operations, it will be at 50 percent capacity indoors. They will be balanc-

ing a list of safety regulations with training employees for a work environment they’ve never faced, and addressing concerns of customers who have never dined with restrictions or ordered from waitstaff wearing masks. The Bologna family is among those planning to reopen Monday. It’s yet another reinvention, said Joe Bolo-

gna of Bologna Via Cucina in Rochester and Via Bologna in Clarkston. The pair of Italian restaurants pivoted in the last couple of months to curbside takeout, devising and pricing out dinner packs with chicken, pasta, salad and cannoli. They made pizza kits and started a Taco Tuesday. See RESTAURANTS on Page 100 Via Bologna restaurant at 7071 Dixie Highway in Clarkston is doing curbside pickup, and expects to reopen Monday for limited dine-in service. | VIA BOLOGNA VIA FACEBOOK

DETROIT RISING ` Hudson-Webber’s Melanca Clark on protests, policing and putting more African Americans at decisionmaking tables PAGE 13

Crain’s Excellence in HR Awards PAGES 8-12

CRAINSDETROIT.COM I JUNE 15, 2020

REAL ESTATE

How the SimonTaubman deal came together, then fell apart BY KIRK PINHO

On Oct. 24, Robert S. Taubman and David Simon met for dinner. The two men in previous years had tangled, at times acrimoniously, in the shopping mall business: Taubman the head of Bloomfield Hills-based Taubman Centers Inc.(NYSE: TCO) and Simon the head of Indianapolis-based Simon Property Group (NYSE: SPG). That was in the past. The hatchet had been buried and it was time for a deal, a complex agreement that Simon ended up being worth $3.6 billion, with the Taubman family selling part of its 70-year-old business to the nation’s largest mall operator. It was eventually to be dubbed Project Metal by Taubman advisers at Bermuda-based Lazard Frères & Co. LLC, with internal documents referring to Taubman as “Titanium” and Simon Property Group as “Silver.” But 231 days after that initial meeting, the luster had worn off, with Simon attempting to pull the plug on the largest local real estate M&A transaction in recent memory. Taubman is fighting the effort, proceeding with its previously scheduled June 25 meeting to vote on the deal, and what happens is contingent upon how a case in Oakland County Circuit Court plays out. On Wednesday, Simon Property Group said it was backing out of buying Taubman Centers and seeking a declaratory judgment on its exit from the purchase, citing the COVID-19 pandemic and what the SPG called poor financial choices during the outbreak that has killed more than 114,000 nationwide and brought the economy to its knees.

HEALTH CARE

ANALYSIS | CORPORATE RESPONSIBILITY

You sent a #BlackLivesMatter statement. What’s next? Eight ways your company can address racism, starting now BY ALLISON TORRES BURTKA | SPECIAL TO CRAIN'S DETROIT BUSINESS

Since George Floyd’s death and the protests that have followed, companies have responded in different ways. Some issued statements to the public and to their employees, with various messages on police brutality and the Black Lives Matter movement. But beyond such statements, what can organizations do to address these issues — which might include systemic racism in their own space? The value of diversity, equity and inclusion (DEI) has gone mainstream, but many organizations have fallen short in practice. This moment — when public attention is focused on racial injustice and inequity — is an opportunity for

companies to evaluate where they stand, what they stand for and what they can do moving forward.

` TALK TO YOUR EMPLOYEES It’s imperative for companies “to communicate within their internal organization about what they believe in terms of diversity, inclusion and equity in the workplace,” even before issuing public statements, said Graci Harkema, a diversity and inclusion consultant.

Inside ` A letter to my fellow CEOs, by Carla Walker-Miller. Page 6

See DEAL on Page 18

NEWSPAPER

COVID-19 HEROES

Sherelle Hogan’s Pure Heart Foundation aids children of incarcerated parents from a distance. PAGE 7

“The employee shouldn’t have to look on the company’s social media post to see what they stand for,” said Harkema, who started her own firm, Graci LLC, after stepping down from her position as Founders Brewing Co.’s diversity and inclusion director. The worst thing to say is nothing at all, said Darlene King, executive director of the Michigan Diversity Council and a consultant. Even if all you say is: “I am at a loss for words. But I want to learn from you what it is that I need to do, and we need to do to be a better organization, to have better community engagement, to have better corporate responsibility.” See RACISM on Page 15

MSU steps into role with Henry Ford Health Deal mirrors what Wayne State sought BY JAY GREENE

The plans on the table in a far-reaching affiliation proposal between Detroit-based Henry Ford Health System and Michigan State University look a lot like a previous proposal with Wayne State University that fell through last year. Among the proposals contained in a letter of intent signed Wednesday by Henry Ford Health and MSU are a new health sciences center managed by a joint operating company that would undertake research, education and clinical activities. The plan would mark a big step into Detroit for MSU's medical operation, and gives Henry Ford an academic partner that could help it along the road to becoming an academic and clinical powerhouse. However, it would leave Wayne State officials with dim prospects for improving a longtime partnership with Detroit Medical Center that has been marked by conflict. It was management of the joint operating company that scuttled the proposed deal last year between Henry Ford and Wayne State, Crain’s reported in February 2019. Officials for Henry Ford and Michigan State said the details of the management and governance structure of the proposed health sciences center are still being worked out. They said they don't foresee similar problems ahead with the boards closely involved. In an interview with Crain's on Thursday, MSU President Samuel Stanley Jr., M.D., said the MSU board has approved the general concept of the letter of intent. He said the boards want to look more closely at the final language before making final decisions. "The letter of intent says we're going to work on these things. We're going to explore it," he said. "We haven't made decisions on how this would be structured it yet." Norman Beauchamp Jr., M.D., MSU’s executive vice president for health sciences, said the boards of MSU and Henry Ford will be closely involved in helping decide the structure and authority of the new company or committee that would oversee the proposed health sciences center. See MSU on Page 17

CATCHING UP WITH SMALL BUSINESS OWNERS AMID CRISIS Three months of turbulence have strained most businesses. Coronavirus, shutdowns, a tanking economy, police violence and social unrest: It’s been an overwhelming mix. And it’s even tougher for small businesses in Detroit, where challenges pile up on a good day. We caught up with several we’ve profiled before and checked in on how they’re doing. PAGE 18

THE CONVERSATION Veteran events producer Jon Witz says industry isn’t doomed. PAGE 19

THE ECONOMY Corporate bankruptcies likely to surge in second half of 2020. PAGE 3 CRAINSDETROIT.COM I JUNE 22, 2020

HEALTH CARE

DOWNTOWN DETROIT

WAITING FOR WORKERS

Beaumont deal could mean more expansion BY JAY GREENE

Townhouse Detroit has yet to reopen but is targeting July; the lack of an office lunch crowd will be a major challenge for downtown eateries. | NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

Quiet office districts present a major challenge for downtown restaurants, shops THE LIGHTS ARE STILL OFF AT CENTRAL KITCHEN + BAR in the First National Building. Next door, the Roasting Plant coffee shop facing the usually bustling Campus Martius park also remains shuttered. That’s largely because the primary customer base of both trendy establishments is still encamped at home, where they’ve been running some of Michigan’s largest businesses remotely since mid-March amid the coronavirus pandemic. Two weeks into the reopening of Southeast Michigan’s bars, restaurants and retailers, downtown Detroit remains

Chad

LIVENGOOD

NEWSPAPER

mostly desolate on weekdays — and probably will be for much of the summer and possibly into the fall, depending on whether COVID-19 makes a resurgence in Michigan’s largest and hardest-hit city. The work-from-home dynamic for Detroit’s office workforce is going better than many executives expected in March when workers started sheltering in place. Employees wary of the virus or juggling child care issues at home are opting to remain home as long as their bosses let them. See WAITING on Page 17

Lower cost borrowing, economies of scale, additional working capital and expansion in Michigan are four of the major reasons to merge eight-hospital Beaumont Health with 28-hospital Advocate-Aurora Health, say system executives. Last Thursday, Beaumont Health signed a nonbinding letter of intent to explore an asset merger with Advocate Aurora Health, the ninth largest nonprofit health system in the country. If completed later this year as executives hope, the combined 36-hospital Beaumont-Advocate-Aurora system would create a $17 billion revenue company with more than 100,000 employees, 2,500 employed doctors, 650 outpatient sites and a medical school partnership. It would become the nation’s seventh-largest not-for-profit health system by revenue, behind Livonia-based Trinity Health. But several critics of the deal say bigger is not necessarily better and the merger could lead to higher prices for employers and patients. On the other hand, they also say financial benefits could accrue to the merging health systems, helping improve quality and patient outcomes. See BEAUMONT on Page 16

FOCUS | ANN ARBOR REAL ESTATE  Student housing worries: Vast stock of off-campus private student housing could face a reckoning, depending on U-M’s fall semester plans. PAGE 8 Closures mount: COVID-19 takes a toll on usually strong downtown Ann Arbor. PAGE 9

THE CONVERSATION

COVID HEROES: Detroit Phoenix Center’s Courtney Smith takes mission to streets. PAGE 14

Michigan Association For Healthcare Quality President Rebekah Bundesen PAGE 19

CRAINSDETROIT.COM I JUNE 29, 2020

COPING WITH COVID-19

WHO’S MINDING THE STORE? Extra $600 a week makes it tough to find workers, even amid 20% jobless rate BY CHAD LIVENGOOD AND DUSTIN WALSH

Inside the two Mike’s Fresh Market grocery stores in Detroit, the checkouts and delis are understaffed because co-owner Jamal Abro can’t find enough workers for $15-an-hour jobs. At Shepler’s Ferry in Mackinaw City, Chris Shepler has received just seven job applications since March 1 and has roughly half of the employees he had a year ago running ferry boats to Mackinac Island. In recent weeks, Iileen Donnell has been turning down jobs for her Detroit-based residential and commercial cleaning service because she doesn’t have enough help, even just part time. And in downtown Detroit’s Capitol Park, Eatóri Market is keeping its outdoor patio closed on weekdays because owner Zak Yatim can’t find enough workers to manage the cafe side of his urban market. At a time when Michigan’s unemployment rate is hovering above 20 percent, each of these business owners blames their unusual labor shortage on the federal government’s unemployment assistance set to expire at the end of July. “Everyone’s taking their $600 stimulus, putting it in their pocket and running,” Shepler said. See WORKERS on Page 16

Wally Audess (left) and Sam Gappy stock a meat cooler at Mike’s Fresh Market at Seven Mile Road and Gratiot Avenue on Detroit’s east side. | LARRY PEPLIN FOR CRAIN’S DETROIT BUSINESS

HEALTH CARE

FOCUS | DIVERSITY, EQUITY AND INCLUSION

Will this time be different? Will it make lasting change? Crain’s asked Black community and business leaders about this moment of national reckoning around racial inequity. PAGES 8-12

NEWSPAPER

Hospitals: Relief cash won’t cover losses Health systems in Michigan garner more than $4.4 billion in federal COVID-19 relief funding BY JAY GREENE

Michigan’s 10 top hospital systems are expected to receive $1.7 billion in COVID-19 relief grant funds from the federal government and $2.7 billion in Medicare advanced reimbursement loans that must be paid back by the end of the year. Several health system executives told Crain’s the $4.4 billion will not cover financial losses incurred by the coronavirus pandemic through June, as measured by lost revenue from elective procedures and surgeries and increased expenses for supplies, additional personal protective equipment and hazard pay. But if there is a second wave of COVID-19 infections this fall, as nearly all public health and infectious disease

experts predict, Michigan's residents and businesses could face another round of costly shutdowns and hospitals and other providers could also absorb even greater financial losses. Of the 10 systems, Southfield-based Beaumont Health is set to receive the most funding from the $175 billion contained in the two COVID-19 relief funding bills that were approved in late March. Beaumont will receive $828 million, including $321.2 million in grant funds and $506.8 million in loans, according to data collected by Good Jobs First and provided by the U.S. Department of Health and Human Services and the Centers for Medicare and Medicaid Services as of June 26. See HOSPITALS on Page 18

Systems receiving the most COVID-19 relief Top 10 health systems in Michigan that received COVID-19 federal relief funds Medicare loans

Health System

Grants

MidMichigan UP Health Michigan Medicine McLaren Health Care DMC Tenet Henry Ford Health Beaumont Health Ascension Michigan Trinity Michigan Spectrum Health System totals

$49.3 M $121.5 M $5.8 M $5.1 M $116.9 M $269.6 M $146.5 M $344.2 M $163.2 M $149.6 M $399.7 M $408 M $321.2 M $506.8 M $242.6 M $402.5 M $165 M $219.5 M $128 M $228 M $1.74 billion $2.65 billion

* Henry Ford, Spectrum provided verified data based on amount received from all sources of relief funds. SOURCE: GOOD JOBS FIRST COVID STIMULUS WATCH, CENTERS FOR MEDICARE AND MEDICAID SERVICES, U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES, DATA AS OF JUNE 26 CRAIN’S DETROIT BUSINESS GRAPHIC

DREAM CRUISE: Unofficial event may go on, but businesses will take a hit. PAGE 3

PART OF THE CYCLE Raj Kothari, in The Conversation, knows crisis forces change. PAGE 19

CRAINSDETROIT.COM I JULY 6, 2020

COPING WITH COVID-19

REAL ESTATE

TRACKING THE TRACERS

Landlords: Evictionprevention plan lacking BY KIRK PINHO

whelmed by the outbreak in other states — South Carolina reported more people in the hospital and more deaths from COVID-19 on Wednesday than any day since the pandemic began in March. Michigan hopes not to follow suit.

Gov. Gretchen Whitmer’s $50 million Eviction Diversion Program is aimed at shoring up residential landlords and preventing evictions during the COVID-19 pandemic — but some landlords say it’s not enough to keep them afloat. Some apartment owners say the fund isn’t large enough to cover unpaid rent accrued during the public health disaster and that a related measure by the State Court Administrative Office increases landlord legal fees by lengthening the eviction process at the local level. Evictions have been banned in most cases since March, but the new order extends that moratorium through July 15. The lump-sum funding through the federal CARES Act will be paid out through the Department of Labor and Economic Opportunity provided that landlords commit to keeping tenants in their homes and forgiving late fees and some of the past-due balances. The program begins July 16. If the back-due rent isn’t fully covered by the program, payment plans will be reached. For example, under the executive order: If a landlord gets $450 from the program on a $1,000 late rent bill, the landlord would be required to forgive $50, or one-ninth of what the state covers, and the tenant would be responsible for the remaining $500 over the course of 12 months.

See TRACING on Page 16

See LANDLORDS on Page 18

Members of the Detroit Health Department’s COVID-19 team, pictured on March 24, work on virus response efforts. More on Detroit’s efforts on Page 16. | CITY OF DETROIT VIA FLICKR

How health departments are monitoring the spread of COVID-19 BY DUSTIN WALSH AND ANNALISE FRANK

Janet Olszewski is part of a growing army racing against the clock. COVID-19 outbreaks are spiking across the U.S. — a single-day record 54,357 new cases were reported Thursday, more than three months after the outbreak began. Michigan’s case count has been steadily rising since late June and with 138 cases and counting linked to Harper’s Restaurant & Brew Pub in East Lansing, proving the virus is far from over. Olszewski, 68, is part of the state’s

stable of 422 volunteer contact tracers who, along with thousands from county and municipal health departments, are charged with contacting within 24 hours anyone exposed to a person that tested positive for COVID-19. Often, Olszewski is the bearer of the news that an infection is possible. “This is not a call any of us want to receive,” Olszewski said. “Some are scared. Some are surprised. Some are even annoyed. But our role is to give them information and be persuasive that it’s really important for them to isolate and be responsible. We can only stop this virus together.”

FOCUS | SAULT STE. MARIE

NORTHERN NICHE  Crain’s Michigan Business looks at companies in the Upper Peninsula. PAGE 8

NEWSPAPER

From her home in Bath, Olszewski and the contact tracer team across the state are in daily contact with more than 1,700 exposed individuals in late June, hoping to convince them to self-quarantine for 14 days and monitor their symptoms in an attempt to control the spread. More than 10,000 volunteered to the Michigan Department of Human Health and Services to be contact tracers. More than 3,800 are partially trained. Oakland County has roughly 197 case investigators and contact tracers. No one is sure if that’s enough. Contact tracers are being over-

Inside: Detroit COVID-19 contact tracing not yet “where we need to be.” PAGE 16

HEALTH CARE

Nursing homes struggle to meet testing deadline Mandate gives until July 17 to test employees, residents for COVID-19 BY JAY GREENE

Nursing homes in Michigan are struggling to meet a state mandate to test all employees and residents by July 17, then weekly test everyone who is deemed high risk as COVID-19 numbers creep upward across Michigan and the nation. Two weeks ago, under an emergency order by the Michigan Department of Health and Human Services, nursing homes and long-term care facilities were required to perform weekly tests of all residents and staff until a

facility goes 14 days without a positive test. At that point, close screening would take place. While the Health Care Association of Michigan has Samuel long supported universal testing to reduce the potential spread of coronavirus among many elderly and immune-deficient residents, some nursing home

operators have questioned details of the order and how effective it will be because of the slow turnaround time of two to three days or more for test results. “There are challenges with using the state process at this point right now,” said Melissa Samuel, CEO of HCAM, the state association for nursing home and rehabilitation centers. “The deep swab (virus) test is challenging to administer to an elderly population.” See TESTING on Page 17

THE CONVERSATION

Wedding industry takes a plunge. PAGE 3

First Independence Bank chairman and CEO Kenneth Kelly leads the seventh-largest African Americancontrolled bank in the US. PAGE 19

CRAINSDETROIT.COM I JULY 13, 2020

CRAIN’S WOMEN IN LEADERSHIP | Q&A WITH DR. KHALDUN

MAKING THE MOST OF A SECOND CHANCE

QUICKEN LOANS IPO

NOT JUST ANY UNICORN

Company’s strong balance sheet differs from some recent offerings Investors may be happy to bet on founder Dan Gilbert Some experts worry that company may be branching out too far BY NICK MANES

In her first year of medical residency, three weeks after giving birth to her first child, Joneigh Khaldun, M.D., now the state’s chief medical officer, ended up in the ICU with a life-threatening head bleed. The recovery was difficult, but the experience inspired her life’s work. “I made a conscious decision afterwards that I was going to bounce back. I was going to finish my medical training and do something with the second chance at life that I had. My passion is not only being a good doctor, but changing systems and changing the trajectory of health for people in society.” READ THE INTERVIEW ON PAGES 8-9.

NEWSPAPER

This Rocket isn’t your typical unicorn. Once Quicken Loans LLC goes public as Rocket Cos. Inc., it will be a different kind of IPO than Wall Street is used to. Investors will find a mature, highly profitable company near the top of its industry, rather than a cash-bleeding startup with global ambitions. A company that continues to have room to grow, with a compelling digital business model. Moreover, the company is led by, and will continue to be controlled by, founder Dan Gilbert, whom investors will have little problem placing bets on, IPO experts say. While a specific valuation remains unclear, and the company has yet to announce a timeframe for when an offering could happen, initial press reports citing anonymous sources have said Quicken Loans could raise somewhere in the tens of billions of dollars. While many questions remain, there’s a simple truth, says Erik Gordon, a clinical assistant professor at the University of Michigan’s Stephen M. Ross School of Business: Quicken Loans is in the enviable position of not needing to go public. “They’re not one of those biotech companies that’s about to run out of money,” said Gordon. “They have real strong cash flow.” Indeed, the mortgage lending giant’s financials — laid bare for the first time last week in a federal S-1 securities filing — paint a picture of a company in extremely good fiscal health. In 2019, Quicken Loans and its portfolio companies reported $898 million in profits, or a 17 percent profit margin, on $5.1 billion in reported revenue. Those numbers made for a 46 percent jump from 2018 and 16 percent higher than the $771 million in pre-tax profits reported in 2017, as Crain’s reported. So why would a company that has largely operated away from the sunshine — aside from its ubiquitous marketing and highly visible presence in downtown Detroit — now choose to subject itself to the mandatory reporting requirements that come with being a public company? See QUICKEN IPO on Page 16

Quicken Loans Inc. founder Dan Gilbert speaks at Crain’s Newsmaker of the Year luncheon in February. | ANDREW JOWETT FOR CRAIN’S DETROIT BUSINESS

ANALYSIS

Gilbert isn’t giving up wealth, control — he’s amassing it Dan Gilbert can continue his real estate spending spree on Detroit if his mortgage behemoth goes public as planned — and continue it in a more robust fashion, if he so chooses. Rocket Cos. confirmed previous reports last Kirk week when it filed what’s known as a Form PINHO S-1 with the U.S. Securities and Exchange Commission, a document that declares a company’s intent to sell shares on the public stock exchange, in this case, the New York Stock Exchange with the ticker RKT. The value of the Rocket’s pending initial public offering, or IPO, is unknown but could be tens of billions of dollars, with billions flowing into the 58-year-old Franklin resident’s Rock Holdings Inc. holdings company as he retains 79 percent of the combined voting power of Rocket’s four proposed classes of common stock and stacks its board with his appointees — if it goes forward as currently envisioned. Jay Ritter, an economist at University of Florida and IPO expert, told Crain’s that the

MORE ON THE QUICKEN IPO  Who’s who in the inner circle of Rocket Companies. PAGE 16-17  How much will Quicken be worth? PAGE 17

Rocket valuation should be around $20 billion, possibly giving Gilbert a $4.2 billion haul, depending on the precise ownership structure of Rock Holdings. See PINHO on Page 15

THE CONVERSATION Jim Murray, back in the Capitol taking on Michigan’s utilities

Tigers set to return amid pandemic PAGE 3

PAGE 19 CRAINSDETROIT.COM I JULY 20, 2020

COPING WITH COVID-19

CRACKING OPEN THE GATE Business travel takes on fraught new reality

When Jimmy Pappas checked into the Homewood Suites hotel in downtown Cincinnati last week, a grocery delivery service was en route. From his rental car, he loaded two boxes onto the hotel’s bell cart — one filled with sanitizers and other cleaning materials and the other with cooking utensils and dinnerware — along with his luggage. He then proceeded to wipe down the door handles, sink handles, TV remote and other high-touch surfaces.

A passenger walks by the baggage claim at the McNamara Terminal of Detroit Metropolitan Wayne County Airport in Romulus on July 16.

See TRAVEL on Page 16

NONPROFITS

DETROIT

$10 million deficit from lost ticket, concession, events revenue

Duggan’s new blight bond plan would ‘put Detroiters to work’ — but it’s not so simple

BY SHERRI WELCH

BY ANNALISE FRANK

The Henry Ford facing budget shortfall Like other arts and cultural groups that rely on earned revenue for a significant part of their budgets, The Henry Ford has been hit hard by COVID-19 pandemic-spurred closures and cancellations. The Dearborn nonprofit is facing a $10 million to $20 million budget deficit due to event cancellations and the four-month closure of its

attractions: The Henry Ford Museum of American Innovation, Greenfield Village, Ford Rouge Factory Tour and Benson Ford Research Center. “Everything we’ve done in the past to build a robust business model to help us earn ... revenue has pretty much dissipated,” President and CEO Patricia Mooradian said. “We’ve had to look at every possible area to save and cut back.” See HENRY FORD on Page 16

NEWSPAPER

Mayor Mike Duggan’s updated plan to sell $250 million in bonds for blight removal is being pitched as a jobs initiative at a moment when Detroit is grappling with a high unemployment rate due to the coronavirus pandemic. To get a piece of the pie, contractors could be required to adhere to an executive order requiring that Detroiters perform at least 51 per-

cent of work hours for a taxpayer-financed project. But there’s an escape hatch to the rule. Duggan’s new blight bond proposal would let contractors instead take a second option — the same deal FCA US LLC got for its east-side Jeep assembly plants, prioritizing job applications from Detroiters first. See BOND on Page 15

FOCUS | HEALTH CARE ARE HOSPITALS PREPARED FOR NEXT COVID-19 WAVE?  Ready or not, it’s coming: Health systems in Michigan say they are prepared for an increase in cases, but second surge predictions vary wildly. PAGE 8

NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

BY DUSTIN WALSH

KEEP UP WITH METRO DETROIT’S FASTEST-GROWING COMPANIES

PAGES 8-13

DEVELOPMENT Statewide brownfield incentive overwhelmingly funds Detroit work.

THE CONVERSATION Adrian Tonon, Detroit’s 24-hour economy ambassador.

PAGE 3

PAGE 22 CRAINSDETROIT.COM I JULY 27, 2020

HEALTH CARE

‘No confidence’ petition drive targets heads of Beaumont

POLICE RESIDENCY RULES

Doctors cite merger, internal changes BY JAY GREENE

SHOULD COPS LIVE WHERE THEY WORK?

2020’S TENSIONS REVIVE AN OLD DEBATE. PAGE 14

Activist Williams: Mandatory residency would connect police to Detroit. PAGE 16 Chief Craig: Residency requirement would ‘severely limit’ recruiting. PAGE 17 Exec Evans: The theory is good, but residency rules are impractical . PAGE 17

JOIN THE ONLINE CONVERSATION Listen as three Midwest mayors discuss cities in transition. DETAILS, PAGE 18

Detroit police stand in formation as protesters against police brutality walk towards the Detroit police 12 precinct on July 10. | NICOLE HESTER/ANN ARBOR NEWS VIA AP

Some influential physician leaders at Beaumont Health are circulating a no-confidence petition on CEO John Fox and Chief Medical Officer David Wood Jr., M.D., they plan to submit to the board of trustees this month. The physician no-confidence petition — a step infrequently taken in recent years by doctors either to voice displeasure with management or with board oversight — asks the 16-member board of directors to immediately remove Fox and Wood, who also are board members. “Over the last five years, we the Medical Staff of Beaumont Health have seen a rapid and progressive deterioration in every aspect of patient care at Beaumont Health. We no longer have confidence in the administration’s ability to provide a safe place for us to care for our patients,” the no-confidence petition says. See BEAUMONT on Page 20

COPING WITH COVID-19

Pods? Private tutors? Parents seek creative school solutions NEWSPAPER

BY DUSTIN WALSH

When Ann Arbor Public Schools announced last week it planned a fully virtual start to the school year, Jordan Else was months into her plan to adapt. The 36-year old co-owner and office manager for off-campus rental firm Wessinger Properties created her “pod” back in June. The idea was social at first — find a group of friends with similarly aged kids and similar risk factors to con-

tracting COVID-19 and stick together. Else’s family, including her 2-year old and 5-year old, podded off with another local family, also with two kids, they’d been friends with for five years. Now that friend group plans to share teaching duties of the four children while balancing careers as the school district won’t return to inclass instruction in the fall. Podding is among the solutions parents around the country, includ-

ing in Michigan, are concocting during the ongoing pandemic. Others are holding out hope for schools to open after Memorial Day and some are looking to hire their own private teachers. The agonizing truth is none of the options is satisfactory. A private tutor is expensive. Creating a pod can be complicated. All of it will worsen educational inequality. See PARENTING on Page 19

THE CONVERSATION

Small business: Reopening a business is not always a simple decision. PAGE 3

Christian Greer, president and CEO of the Michigan Science Center PAGE 22

CRAINSDETROIT.COM I AUGUST 3, 2020

ENTREPRENEURSHIP

MOTOR CITY MATCH HITS A CROSSROADS Small-business program faces decisions on how to evolve in a fast-changing landscape BY ANNALISE FRANK

A gardening services business with plans for a fresh market and cafe. A couple looking to revive a closed-down poetry-and-jazz lounge. These two Detroit businesses earned design awards through Motor City Match, the city's flagship funding machine for entrepreneurs looking to start up along commercial corridors with storefronts that need filling. But they had vastly different experiences, positive and negative, with the program that's been much-touted by city officials and is up for either evolution or demise at the end of this year. So what's next for the 5-year-old program? The city of Detroit, as of early this year, planned to Need to know renew the small busi- ` Small business ness-funding machine as grantmaking a "version 2.0" after its program’s contract original run, focusing up at end of year more on technical assis- ` Recipients report a tance. Some have ex- mix of experiences pressed concerns about how long the program takes to complete and its viability for cash-strapped entrepreneurs without in-depth knowledge of the ins and outs of building a successful business. But those aspirations got waylaid with the onslaught of the coronavirus pandemic. The small business financing landscape has changed. It's not clear if matching grants for storefront space are still the best way to help. "What I hear from our partners … and our team … Their concern is businesses that we help open may not survive this," Arthur Jemison, Detroit's chief of services and infrastructure, said in referencing the economic fallout from the monthslong pandemic.

Ashley Logan, an entrepreneur who started Klassic Mobile Gardens LLC and won a design award in late 2018, had a rough time in the Motor City Match program, which has had a mixed record, participants say. SYLVIA JARRUS FOR CRAIN’S

See MOTOR CITY on Page 20

FINANCE

1st-day blastoff for Rocket IPO? Stock market debut, as early as this week, comes at ripe time BY NICK MANES

Ground-floor investors of Rocket Companies Inc. have some significant tailwinds behind them as the Detroit-based mortgage lending giant finalizes its initial public offering, which is expected to happen as early as this week. Beyond being viewed as a mature, profitable company, the soon-to-be parent orga-

nization of Quicken Loans Inc. could be in the upper echelons of U.S. initial public offerings. Moreover, Rocket Companies' entry into the public markets appears to come during a ripe time, even despite broader economic pain such as skyrocketing unemployment and contracting GDP. See ROCKET IPO on Page 20

NEWSPAPER

EDUCATION

In Michigan schools, fall restart anxiety reaching a ‘fever pitch’ BY CHAD LIVENGOOD

During a Grosse Pointe Public School System board meeting Monday night that lasted nearly five hours, a board member asked whether classrooms will be cleaned between each period to prevent spread of the coronavirus. “This is the minutiae that we don’t think

about that is now at the top of our list,” Grosse Pointe school board member Cindy Pangborn said. The school district's deputy superintendent on the other end of a webcast — originally a math teacher by training — didn't have an immediate answer. See SCHOOLS on Page 19

FOCUS | NONPROFIT COMPENSATION  Salaries for CEOs of state’s biggest nonprofits tangled in COVID-19’s web PAGE 10 Data analysis: The top-paid nonprofit executives, by category. PAGE 12

THE CONVERSATION Christman Co.’s Ron Staley on projects, planes and presidents.

Michigan Business: The Sunrise Side PAGE 16

PAGE 26

CRAINSDETROIT.COM I AUGUST 10, 2020

CRAIN’S DETROIT BUSINESS C-SUITE SURVEY

Work from home is here to stay, but it is still evolving Rocket Companies, the now publicly traded parent company of Detroit’s Quicken Loans, originated $72.3 billion in residential mortgages during the second quarter — a 40 percent increase from the first three months of this turbulent year. They also added 100,000 clients to their portfolio of 1.93 million mortgages they service each month.

Chad

LIVENGOOD

And the company’s 19,000 employees largely handled this growth from their home offices, basements, kitchen tables or wherever they’ve been encamped since mid-March to avoid contracting the coronavirus. “Working from home has been demonstrated — it works and it can be very, very efficient,” Rocket Companies CEO Jay Farner said Thursday on CNBC just before the company

Special Report  What’s Next? At a time of uncertainty, we take a look at what we’ve learned and what to watch, across major industries. Pages 8-13

debuted on the New York Stock Exchange. (See story, below.) For a company that just reaped at least $1.8 billion in stock sales and is known for wringing out every bit of

productivity from its white-collar workforce, working from home has been a success. It’s also probably here to stay. A recent Crain’s survey of metro Detroit C-suite executives found 53 percent of companies either haven’t asked employees to return to the workplace or are making it voluntary. See LIVENGOOD on Page 25

Marijuana industry thrives in COVID-19 economic drought

MICHIGAN MARIJUANA

GROWING LIKE A WEED

BY DUSTIN WALSH

Sales were steady, if a little slow, last Wednesday during the lunchtime hour at High Profile cannabis dispensary in Ann Arbor. A single mask-wearing customer browsed the small shop’s selection of marijuana flower grown at the company’s Online operations 45  Michigan miles northwest regulators to in Webberville. rescind law tying A handful of medical, recreothers mean- ational pot. dered in the crainsdetroit.com front door of the turn-of-the-century multitenant college town home turned commercial building, showing IDs to the receptionist for a pickup order. Employees emerged moments later onto the sidewalk two blocks away from the University of Michigan’s Ross School of Business to deliver the goods. But Ankur Rungta, CEO of C3 Industries LLC and its four retail shops in Ann Arbor, Detroit, Grant and Buchanan, said despite a lack of college kids during the summer months in Ann Arbor and an seemingly neverending pandemic, the Packard Street store is exceeding sales expectations since opening in March.

Jay Logan of Ann Arbor, left, checks out some cannabis product while being helped by Halie Stewart of Ann Arbor at High Profile - Boutique Cannabis in Ann Arbor. “I like the selection. I know what’s going to be here on a regular basis,” Logan said. | NIC ANTAYA FOR CRAIN’S

See WEED on Page 24

CRAIN’S Q&A | RIGHT FROM THE SOURCE

Rocket stock jumps in stock-market return as it shares wealth A chat with Rocket COO Bob Walters on what’s ahead for the mortgage giant after the IPO VOL. 36, NO. 32 l COPYRIGHT 2020 CRAIN COMMUNICATIONS INC. l ALL RIGHTS RESERVED

BY NICK MANES AND CHAD LIVENGOOD

first two days of trading, jumping 37 percent from the IPO price and closing at $24.67 on Friday. Founder and Chairman Dan Gilbert saw a nice bump, too: His net worth rose to about $34 billion, according to the Bloomberg Billionaires Index — more than four times previously estimated. And Gilbert is sharing the wealth, giving all employees shares in the now-public company, which includes Quicken Loans and Rocket Mortgage.

NEWSPAPER

ocket Companies Inc. had its long-anticipated initial public offering Thursday and netted $1.8 billion in doing so, giving the Detroit-based online mortgage giant a market capitalization of about $43 billion. That’s less than had been anticipated, but top executives said they’re more than happy with the outcome. The stock (NYSE: RKT) saw a nice bump in its

Walters

See WALTERS on Page 24

PAGES 9-25

THE CONVERSATION

NONPROFITS After-school providers offer virtual learning ‘pods.’

OU President Ora Pescovitz on return to campus, planning past pandemic. PAGE 32

PAGE 3

CRAINSDETROIT.COM I AUGUST 17, 2020

SNAIL MAIL TURNS SLUGGISH SHIPPING

Slow business mail delivery wrapped up in U.S. Postal Service politics BY CHAD LIVENGOOD AND DUSTIN WALSH

Daniel Haberman, the owner of a commercial mail receiving agency in Troy, breathes a sigh of relief these days when envelopes and boxes actually arrive for his more than 100 business clients who pay him to collect their mail. There are some days he gets no mail at all. “It’s inconceivable,” said Haberman, owner of Byte & Mortar on Crooks Road. Before the pandemic, Haberman said the Postal Service’s track record had been “amazing, almost no mistakes.” Now, Haberman said he’s lucky to see a carrier more than three times a week.

Some businesses are reporting a rise in late mail deliveries and days with no mail. | LARRY PEPLIN FOR CRAIN’S

See MAIL on Page 30

REAL ESTATE

HEALTH CARE

Coworking spaces hold out hope for people sick of WFH

COVID-19 patients have lingering effects

BY NICK MANES

BY JAY GREENE

Beatrice Wolnerman celebrated the grand opening of her new coworking space, Bea’s Detroit on Winder Street in Eastern Market, during the first week of March. Less than two weeks later, she shut the doors as state mandates took hold as the coronavirus pandemic spiraled out of control. Bea’s is back up and running now, and small businesses that rent a desk or a private office are welcome to return. But the traffic remains light, Wolnerman said. It’s mostly the ground level cafe and small events such as weddings that have gone forward that are paying the bulk of the bills at the almost entirely

new building, save for an old wall. Wo l n e r m a n , who owns the building and is paying a mortgage, has had to offer some concessions to struggling tenants, she said. Wolnerman “It’s definitely a little stressful,” said Wolnerman, a 2020 Crain’s 20 in their 20s honoree. “I mean, we still believe that there is a place for coworking in this world. Luckily we do have a lot of private offices that really do give people ... their own space.” See COWORKING on Page 31

Frontline doctors see post-recovery heart, lung, kidney problems

COVID-19 long haulers and post-viral COVID-19 syndrome are new phrases used to describe people who contracted COVID-19 and thought they had recovered, only to develop a range of lingering health problems. Michigan doctors tell Crain’s that some patients discharged from hospitals after COVID-19 have developed heart and kidney problems, suffered lung damage and neurological issues such as blood clots and joint pain. Doctors say these problems are likely associated with having contracted the COVID-19 disease.

“WE HAVE HAD ABOUT 10 PATIENTS WITH (COVID-19) DIAGNOSIS IN MARCH, APRIL AND MAY. THEY STILL HAVE SHORTNESS OF BREATH AND OTHER THINGS.” — Heather Abraham, M.D.

Heather Abraham, M.D., an assistant professor of internal medicine at Wayne State University School of Medicine, opened a COVID-19 continuing care clinic in late July at the University Health Center at DMC Detroit Receiving Hospital. Abraham, who also is a member of University Physician Group, a

WSU-affiliated faculty practice group, has been treating 10 patients who tested positive for COVID-19 and are having lingering health problems. “It is tricky. We are in the process of working patients up. We have had about 10 patients with (COVID-19) diagnosis in March, April and May. They still have shortness of breath and other things” such as fatigue and symptoms similar to post-traumatic stress disorder, Abraham said. “Mostly people had asthma, COPD, heart failure, stroke” and are complaining they are not well. See DOCTORS on Page 29

Lasting legacy: Colleagues recall developer Eric Means after his death at 48. PAGE 5

Rough seas: Inside-out economy, stock market produce unusual agreement among finance pros. PAGE 8

CRAINSDETROIT.COM I AUGUST 24, 2020

EDUCATION

ILLUSTRATION BY ANDREA LEVY FOR CRAIN’S DETROIT BUSINESS

SEARCHING FOR EQUITY AMID CRISIS

The coronavirus crisis has caused us to look at education through a new lens, laying bare the longstanding inequities in how we deliver and pay for the schooling of our children. In this month’s Crain’s Forum, we take a new look through that lens at the consequences of previous attempts to create a more equitable system and some of the challenges schools are facing in this most uncertain time for education.

ALSO IN FORUM

Funding tiers: How exceptions add up to inequities. PAGE 14

Virtual or live: There’s no one-size-fits-all for learning. PAGE 15

Technology: It’s tough to get tech in students’ hands. PAGE 17

Voices: Three advocates offer their views. PAGE 16 Q&A: Detroit schools superintendent Nikolai Vitti. PAGE 17

NONPROFITS

Food banks expect demand spike as school-meal waiver ends NEWSPAPER

BY SHERRI WELCH

When school is back in session, free lunches will stop for some at-risk children. Children too young to attend school and the newly vulnerable peers of students enrolled in free and reduced-cost breakfast and lunch programs will no longer be eligible to receive food through a federally

funded program that has helped keep them fed since March. A federal waiver that took effect after schools closed to provide free food for all children through food boxes distributed by emergency providers at driveup sites around the region ends Aug. 31 or the first day of school, whichever is earlier. Schools will shift back to the regular school-year programs that provide food only for enrolled students.

And that will leave outstanding need for emergency food providers to fill without the ability to seek reimbursement. The gaps left by resuming the regular school meal programs represent the fourth wave of need to come at food providers since the pandemic began. See MEALS on Page 22

THE CONVERSATION

Developer, school board member Sonya Mays on learning to adjust PAGE 22

UM’s Schlissel: We will test thousands. PAGE 3

CRAINSDETROIT.COM I AUGUST 31, 2020

FADING GLORY BY KIRK PINHO | On Jan. 17, workers in the Penobscot

Building downtown streamed out as an elevator fire sent them to Griswold Street in freezing weather. The fire wasn’t the first sign something was the matter with the 47-story office skyscraper that at one point was the city’s tallest. Instead it was just the most publicly noticeable manifestation of years of what some say is deferred maintenance, making it one of the last major buildings in the central business district to get a serious renovation during the decade-long historic renovation and building boom in the city’s core. The lack of upkeep hasn’t been without consequences.

FOCUS | OFFICE DESIGN

THE OPEN OFFICE ERA MAY BE OVER COVID-19 forces work spaces to evolve. PAGE 10

NEWSPAPER

LARRY PEPLIN FOR CRAIN’S DETROIT BUSINESS

Once Detroit’s crown jewel, the Penobscot Building is losing tenants, facing a lawsuit and struggling to avoid repercussions from the city

The Penobscot, 645 Griswold St., has lost two major tenants and has been socked with no less than 161 tickets totaling over $92,000 in blight violations this year alone, with the city threatening a nuisance abatement lawsuit if the Toronto-based ownership group, Triple Properties Inc., doesn’t fix the neglected portions of the building. One of the tenants that vacated, Strategic Staffing Solutions LLC, has sued Triple Properties in Wayne County Circuit Court,

claiming it sent its landlord approximately 70 written notices with building maintenance issues between May 2018 and August 2019 alone. They included “repeated and severe issues involving water leaks, heating, cooling, insect infestations, broken and/or malfunctioning elevators, lighting, construction noise and dust, plumbing, electrical wiring and structural issues.” See PENOBSCOT on Page 20

NONPROFITS

Capacity limitations strain arts, culture organizations even as patrons come back BY SHERRI WELCH

On typical busy summer days before COVID-19 was ever a thought, 10,000-15,000 people showed up to visit the Detroit Zoo. These days, the zoo is hosting 3,500 people most days but an additional 400 for special hours on weekend nights through August. Like other cultural organizations and all businesses, there are limits on how many people it can host each day. And that’s putting a crunch on

arts and cultural organizations — even those partially supported by an operating millage. “We often see the daily maximum numbers reached … (but) earning at the gate less than half of what we would normally earn … pre-COVID,” Communications Manager Alexandra Bahou said in an email. Like the Detroit Institute of Arts, the zoo benefits from a tricounty millage which covers about a quarter of its operating budget. A paycheck protection program

loan, donations, reserves and earned revenue (albeit decreased) are enabling it to continue operating, Bahou said. But it’s cut its budget from $45 million to $25 million. “We are fortunate that the community supported the millage … (and) that so many members and donors continue to support the organization,” and there is about $26 million in accessible endowment funds, she said. See LOSSES on Page 20

COVID-19 LIABILITY: Lawmakers still debating how to give businesses lawsuit protections. PAGE 3

CRAINSDETROIT.COM I SEPTEMBER 7, 2020

CRAIN’S DETROIT BUSINESS PORTRAITS CREATED FROM CONTRIBUTED PHOTOGRAPHS USING THE PRISMA APP

MEET THE CLASS OF 2020 | PAGES 8-27

UNDER

FORTY

CRAIN’S DETROIT BUSINESS SAVE THE DATE: Celebrate with the winners — as well as our 2020 Class of 20 in their 20s — during a virtual event the week of Nov. 15; visit CrainsDetroit.com/ Celebrate for details.

COPING WITH COVID-19

Migrant farm workers push back on state’s COVID-19 testing mandate NEWSPAPER

BY CHAD LIVENGOOD AND DUSTIN WALSH

BEAR LAKE — At West Wind Orchards, longtime farm laborer Leo Magana serves as the de facto recruiter of seasonal migrant farm workers to pick apples each fall in orchards along the bucolic M-22 highway in Manistee County. Magana, a year-round employee

of the family-owned farm that dates back to the 1870s, has been trying to recruit 28 migrants for fourth-generation farmer David Smeltzer and other nearby fruit farms. The Mexico-born immigrant uses a variety of contacts to get the laborers Smeltzer needs to hand-pick 100,000 bushels of apples that end up in fresh fruit markets, hard cider from

Tandem Ciders, Gerber baby food and Materne’s GoGo Squeez apple sauce in a pouch. But with the height of the apple-harvesting season just weeks away, Magana has only been able to find 13 workers this year. And there’s no guarantee all of them will show up. See WORKERS on Page 28

Kenneth Kelly, First Independence chairman and CEO

First Independence gets big boosts PAGE 6

CRAINSDETROIT.COM I SEPTEMBER 14, 2020

Country clubs turn to subdivisions PAGE 3

HEALTH CARE

Former Beaumont trustee speaks out on merger Urges AG Nessel to pressure health system’s board to delay deal, fire top executives BY JAY GREENE

A former Beaumont Health board vice chair and trustee has sent a scathing five-page letter to Michigan Attorney General Dana Nessel asking her to “require or suggest” the 16-member Beaumont board of directors fire CEO John Fox and his top two lieutenants. Mark Shaevsky, who served on the Beaumont board for 17 years until 2014, told Crain’s he has been

frustrated the past several months that a majority of the Beaumont board appears to support the proposed merger with 28-hospital Advocate Aurora Health, a nonprofit health system with offices in Chicago and Milwaukee. He also said he doesn’t believe the board has sufficiently addressed patient safety concerns expressed by doctors and nurses.

NONPROFITS

FROM HOMELESS TO C-SUITE

See BEAUMONT on Page 23

ECONOMY

Pandemic recession hits women harder than men for 1st time

Jennifer Berkemeier is one of many women whose employment prospects have suffered during the pandemic. | LARRY PEPLIN FOR CRAIN’S DETROIT BUSINESS

Job losses rise, income falls for women in downturn BY DUSTIN WALSH

Jennifer Berkemeier sells plasma twice a week to help pay off credit card debt and utility bills. It’s also a respite from the hours she spends each day writing cover letters and applying to employers that’ll probably never call back. The 54-year-old single mother to an 11-year-old daughter has worked the night shift as a cashier at Kroger since May when TCF Center in Detroit cut the pay of its workforce.

Event cancellations were mounting well into 2021 and the Army Corps of Engineers was transforming the space into a makeshift field hospital to treat overflow COVID-19 patients. Berkemeier, a sales manager for the convention hall for nearly nine years, was eventually laid off at the end of July as there appeared no chance of events resuming in Detroit any time soon. Since then she’s applied to more than 75 jobs and been rejected by all of them. See WOMEN on Page 25

NEWSPAPER

Rita Fields returned to Lighthouse as chief talent and strategy officer 29 years after her first visit. | NIC ANTAYA FOR CRAIN’S

Lighthouse executive role is ‘intensely personal’ for Rita Fields `BY SHERRI WELCH | On her own and pregnant at age 18, Rita Fields was sleeping behind the Kroger at 13 Mile and Woodward in Royal Oak when she first heard about South Oakland Shelter. She’d dropped out of high school, run away from an abusive mother and her Detroit home before winding up on the streets with her boyfriend when the money for hotels in Oakland County ran out. She was about seven months pregnant when she and her boyfriend learned of the rotating shelter SOS coordinated in area churches and sought help. It would be her first tour at SOS — which now operates as Lighthouse — but not her last. In late August, after serving as a board member at two different points, Fields returned to SOS 29 years after her first visit to join its executive team and help others get the same help she did. See FIELDS on Page 24

THE CONVERSATION

Actor, singer Deborah Joy Winans

Lansing: Much more than government town PAGES 8-13

PAGE 22

CRAINSDETROIT.COM I SEPTEMBER 21, 2020

MACK AVENUE REBIRTH

How FCA and an army of contractors raced against time to put together the 1st new auto assembly plant in Detroit in three decades

REVVED UP AND READY TO GO BY CHAD LIVENGOOD

Inside

When Fiat Chrysler Automobiles’ engineers started evaluating in 2018 whether two engine plants on Detroit’s east side could be converted into a vehicle assembly plant, they knew the structural configuration of the ceiling would be an obstacle. Powertrain plants are built for ground-level conveyor assembly of engines. Full vehicle assembly plants re-

 A list of the main contractors involved in building the assembly and paint components of the new plant. Page 20

quire different load-bearing ceiling structures to hold up the weight of a two-ton sport utility vehicle coming down the line. “We felt it was doable,” said Ben Monacelli, senior manager for building construction and manufacturing at FCA. “But we didn’t realize how

Remote work could bring revenue hit

Detroit anticipates $160 million city income tax shortfall The city of Detroit stands to lose $160 million in income taxes as many workers shift to telecommuting amid

the coronavirus pandemic. People with jobs at businesses in Detroit who live outside the city do not have to pay city income taxes for the hours they work elsewhere, per

NEWSPAPER

PEPLIN FOR CRAIN’S DETROIT BUSINESS

Left: Equipment was installed as the plant was built. | FCA

See FCA PLANT on Page 20

DETROIT

BY ANNALISE FRANK

Above: An aerial view of FCA’s new Mack Avenue plant as it nears completion. | LARRY

extensive it was going to be.” To transform the old Mack I engine plant into an assembly plant, iron-working construction contractors ended up having to cut 112 steel trusses in the ceiling and add 553 reinforcements to the building’s trusses to support the weight of next-generation Jeep Grand Cherokees set to roll off the assembly line in the first quarter of next year.

the state of Michigan. And that’s making things messy. With many people cooped up in home offices or balancing laptops while lounging on the couch during the pandemic, income tax policies are under scrutiny. And cities that have relied heavily on that money — like Detroit — are likely to end up with less revenue. Michigan’s largest city estimates a $410 million budget shortfall from the pandemic — including $160 million in income taxes, the city’s biggest source of revenue by far. Part of that anticipated income tax loss stems from the recent rise in work from home. See SHORTFALL on Page 19

DETROIT HOMECOMING VIRTUALLY HAPPENING THIS WEEK This year's Detroit Homecoming VII has gone mostly virtual and is open to all Crain's readers. The event, produced by Crain’s, seeks to engage successful Detroit “expats” with their hometown and spur investment in the city: When: Monday-Friday, Sept. 21-25 To attend: Full schedule and registration at detroithomecoming.com Program highlights: The Future of Cities, featuring Dan Doctoroff, Sidewalk Labs; Jamie Hodari, Industrious; Darryl Robinson, CommonSpirit Health Social Media & Our Future, former Twitter CEO Dick Costolo; Sam Gill, Knight Foundation Corporate Response

to Racial Equity/Racial Justice Imperative, featuring Byron Allen, founder/chairman/CEO, Allen Media Group/ Entertainment Studios; Roz Brewer, COO, Starbucks; Robin Washington, board member, Alphabet and Salesforce; Darren Walker, Ford Foundation

Byron Allen

What This Pandemic Teaches Us, virologist Nathan Wolfe and university presidents Samuel Stanley, Mark Schlissel and M. Roy Wilson.

THE CONVERSATION: Neil Hawkins, from Dow to the reins of the Erb Family Foundation. PAGE 26 DETROIT HOMECOMING: Watch videos of the annual expat event at DetroitHomecoming.com. And come back to Crain’s next week for a full report on ‘The D’s Next Decade.’

CRAINSDETROIT.COM I SEPTEMBER 28, 2020

DETROIT

QLine, TCF Center get subsidy from state

Reopening for streetcar system still unclear, ‘months’ away BY CHAD LIVENGOOD

The Michigan Legislature on Thursday authorized a new $5 million-a-year subsidy for the QLine street car in Detroit and $7 million in immediate aid for TCF Center to cover losses sustained this year from a collapse in convention business due to the coronavirus pandemic. Detroit’s struggling streetcar system, which has sat idle since late March, would get $5 million for the fiscal year ending Sept. 30 and then additional $5 million payments in the 2021 and 2022 fiscal years under House Bill 6119. A spokesman for M-1 Rail, the private nonprofit operator of the 3.3-mile-long streetcar on Woodward Avenue, said the $5 million in state aid will help restart and improve the QLine’s service. The QLine, which costs $8 million annually to operate, does not have a target date to resume service, but it’s “expected to take months due to requirements around assuring necessary qualified staffing levels,” M-1 Rail spokesman Dan Lijana said Friday. “Once passenger service resumes, funding will go toward operations of running the QLine such as staffing and maintenance,” Lijana said in an email to Crain’s. See SUBSIDY on Page 22

DEMOCRACY

READY. SET. COUNT. Official absentee vote ballots are poised and ready to mail at the Rochester Hills City Clerk’s office. NIC ANTAYA FOR CRAIN’S DETROIT BUSINESS

The coming election will be like no other in ALSO IN FORUM: Nancy Wang: Why Michigan. Much of that difference will come election reforms should from absentee votes that are expected to more make it easier to vote, and to count the votes. PAGE 16 than double any previous election. Those are Rep. Leslie Love: Give clerks creating a huge logistical challenge for the clerks enough time to pre-process Love ballots. PAGE 17 charged with getting them counted. This week’s Wang Crain Forum analyzes what they are facing — Clerks: One extra day is not enough time to count. PAGE 16 and demystifies the process. PAGE 15 Graphic: How Michigan absentee voting works. PAGE 19

REAL ESTATE

Squeezed hotels fall behind on debt, delay building projects NEWSPAPER

BY KIRK PINHO

Some of the region’s most prominent hotels are more than three months late with their lenders, no fewer than three major greater downtown Detroit hotel building projects are bumping their start dates back due to the COVID-19 pandemic and one has temporarily halted construction completely amid cost overruns.

That’s just some of the fallout the hospitality industry is facing locally, six months into a global health and economic crisis that halted travel and put the brakes on conventions and other business gatherings, dimming or muting revenue streams for the tens of thousands of hotel rooms across Metro Detroit. While hotels have been performing better in recent months, the damage

COVID-19 has wrought will continue to be long lasting on the $10 billion industry that employs 155,000 across 1,400 hotels, according to the Michigan Restaurant & Lodging Association. Of course, the effects go far beyond bricks and mortar and into peoples’ pocketbooks and financial livelihoods. See HOTELS on Page 24

FOCUS | HEALTH CARE: COVID’s deadly effect on mental health. PAGE 34

THE CONVERSATION

Lineage Logistics CEO Greg Lehmkuhl says acquisition tear is not over yet. PAGE 46 CRAINSDETROIT.COM I OCTOBER 5, 2020

HEALTH CARE

Fox blames pandemic for merger failure

THE D’S NEXT DECADE With city again at a turning point, seeking ways to advance equity

Beaumont, Advocate Aurora talks end

See BEAUMONT on Page 45

A decade makes a difference in unpredictable ways. Just look at the last 10 years for Detroit. Now Detroit seems to have hit another turning point, with great and unknown changes being wrought by a global pandemic and a national movement for racial equity. As part of the Detroit Homecoming event produced by Crain’s that seeks to re-engage successful expats with their hometown, we examine some crucial issues for the city at this turning point, and opportunities to expand the city’s renaissance of the past decade in ways that advance equity.

SPECIAL REPORT | PAGES 12-32 NIC ANTAYA FOR CRAIN’S

Beaumont Health CEO John Fox said Friday morning that the mutual decision to end more than four months of negotiations to merge with 26-hospital Advocate Aurora Health of Illinois was primarily made because the two systems and other interested parties could not meet in person because of the COVID-19 pandemic. “As you recall, in June, we had entered into a nonbinding letter of intent with Advocate Aurora that was going to lead us to a due diligence phase and a lot of other expanded work across our organizations,” Fox said in a virtual press conference with the Detroit media. “But this is all done in the middle of a terrible pandemic that gravely injured our normal interpersonal interactions,” Fox said. “(Normally) we’d have a process that are really essential for community-based organizations to build relationships, and get to know each other.” Fox said meetings between boards, committees, doctors and other constituent groups were impossible to conduct. He said more than six other hospital mergers have been canceled nationally this year because of the pandemic. “We’ve tried to Zoom a couple of times and other mechanisms, but it’s not really been adequate,” he said. The proposed merger, which would have created a 34-hospital, three-state regional system with $17 billion in annual revenue, was put on hold in mid-August after several critical surveys of Beaumont management by doctors and nurses were submitted to the 16-member Beaumont board of directors. Donors and legislators later joined the chorus to stop the merger.

LARRY PEPLIN FOR CRAIN’S

BY JAY GREENE

Caroline Sanders at the Detroit Homecoming dinner at Lumen in Detroit.

 Entrepreneurship PAGE 17

 Neighborhoods PAGE 14

 Mobility PAGE 21

 Redevelopment. PAGE 16  Riverfront. PAGE 22  Homecoming VII recap PAGES 26-32  Homecoming online: Videos of all Detroit Homecoming sessions are available at detroithomecoming.com. Click on “livestream events”

ECONOMY

Amid high unemployment, a puzzle: Where are workers?

NEWSPAPER

 Downtown PAGE 12

BY DUSTIN WALSH

The unemployment rate in Calhoun County stood at 10.9 percent in July — the 72nd worst rate out of the state’s 83 counties. But Team 1 Plastics in Albion has been unable to fill four open positions at its transparent plastic auto components plant. “We’ve had people do all the training, and then on the very first day,

they ghost us,” said Gary Grigowski, vice president and co-owner of the 64-employee company. “A few times new hires just didn’t show up after a few days, and we’ve had people who work for a few hours, then don’t come back after lunch.” The tier-two auto supplier is joined by many others in the industry in facing a labor force riddle. Most automotive suppliers are hiring as automakers look to refill deal-

er lots depleted of vehicles during the more than six-week shutdown in the early days of the COVID-19 pandemic. Yet nearly 400,000 in the state remain unemployed and hiring is as difficult or more difficult than before the pandemic during an unprecedented economic growth cycle where unemployment stood at 2.8 percent. See UNEMPLOYMENT on Page 44

BUSINESS AT HOME: Recession spurs rise in kitchen-table businesses. PAGE 3

HEALTH CARE

Michigan Chief Medical Executive Joneigh Khaldun, M.D., to keynote Crain’s Health Care Leadership Summit.

Jennyfer Crawford now operates her brand marketing and event planning firm, Ask Jennyfer, from home.

DETAILS, PAGE 2 CRAINSDETROIT.COM I OCTOBER 12, 2020

CRAIN’S MICHIGAN BUSINESS | AGRIBUSINESS

FEAST OR FAMINE

Federal farm payments yield uneven rewards — but for how long? External forces like trade disputes and government bailouts haven’t changed Stutzman Farms’ field plans for its rows of soybeans, corn and winter wheat. STUTZMAN FARMS

INSIDE FOCUS PAGES 8-11  Hope for a healthy hops market: Even with the challenges of COVID-19, Michigan’s hop growers remain optimistic. PAGE 8

TOP HOPS

 Agribusiness’s quiet giant: Large Michigan footprint, low statewide profile? Must be Corteva Inc. PAGE 11

BY DUSTIN WALSH | Matt Stutzman planted 700 acres of winter wheat in recent weeks across his family farm as usual. The 2,000 acres of clay loam soil see a mix of soybeans, corn and winter wheat as reliably as the sun rises and sets on Stutzman Farms Inc. in and around the village of Blissfield in Lenawee County. The third-generation farmer hasn’t adjusted crop planning in two to three years, despite prodigious movements to the agricultural market thanks to ongoing U.S. trade wars and the unrelenting coronavirus. Stutzman Farms has received increased government support in the past year as a counterbalance to the harm caused by retaliatory tariffs from China and the supply chain interruptions brought on by the pandemic. These new market disruptions are another in a line of challenges farmers face. Increased periods of rain and drought have decimated past growing seasons. See FARMERS on Page 16

EDUCATION

Degrees deferred: MBA programs adapt to new way of doing business BY KURT NAGL

Once considered the gold standard of career development, the MBA degree faces a new question of relevance. Business schools in Michigan are struggling to sell the master’s programs as they face staggering budget cuts and enrollment declines brought on by the COVID-19 pandemic. Increased demand in graduate education often coincides with economic uncertainty, but in the case of a global

pandemic, experts aren’t so sure. Many companies throughout Southeast Michigan halted corporate-sponsored MBAs for employees as they rein in spending during the pandemic. At the same time, prospective students are reluctant to spend tens of thousands of dollars on tuition for mostly online classes. What’s more, even if the core tenets of business remain, the pandemic has influenced monumental change everywhere from auto plants

to office buildings. So, while business school administrators are updating delivery models and marketing methods, professors are racing to reconfigure lesson plans. The MBA is still worth the investment, said Brad Killaly, associate dean for fulltime and global MBA programs at the University of Michigan’s Ross School of Business. But he admits that the marketplace has changed considerably. See MBA on Page 17

UM Ross MBA class size, applicants dropping The MBA program at the University of Michigan’s Ross School of Business, like many such programs, has seen a falloff in the number of applicants and class sizes. Michigan Ross

Class Size Applications Acceptance Rate International Women U.S. Minority SOURCE: UM DATA

2020

2019

358 2,567 37% 18% 43% 36%

2018

421 2,990 31% 27% 45% 31%

2017

423 3,188 27% 32% 43% 35%

2016

422 3,485 25% 34% 43% 37%

413 3,353 26% 35% 40% 37%

CRAIN’S DETROIT BUSINESS GRAPHIC

THE CONVERSATION

Innovation: UM grads use invasive plant to create healthier hair extensions. PAGE 6

Deloitte’s Tina Wheeler navigates health care industry in COVID age. PAGE 22 CRAINSDETROIT.COM I OCTOBER 19, 2020

REAL ESTATE

Cemeteries plot their future

As cremations become the norm, the industry looks for new lease on life Mt. Elliott Cemetery in Detroit was consecrated in 1841 — just four years after Michigan became the 26th state.

KIRK PINHO/CRAIN’S DETROIT BUSINESS

BY KIRK PINHO | If you die in the next 20 years, the chances are good that you’re

going to be cremated. Data from the National Funeral Home Association says that by 2040 in Michigan, 83.6 percent of the people who die will be cremated, compared to 47.3 percent in 2010. And according to the NFHA, the median cost for a cremation funeral with an urn is $6,645, compared to $9,135 for a funeral with a burial, including the cost of the casket and the burial vault.

That’s causing cemeteries and funeral homes to search for new revenue streams. “It does affect cash flow,” said Bert Edquist of Mission Hills Memorial Gardens in Niles in southwest Michigan. “But also it gives you the opportunity to make more burials because you’re using smaller spaces for the

cremation burials. Your land is producing more income, but you’re not getting that income as quickly as you did before. Basically it’s going to make the cemeteries last longer.” Much of the equation comes down to simple real estate. See CEMETERIES on Page 20

HEALTH CARE

Once a COVID-19 vaccine is ready for prime time, how will people get it? BY JAY GREENE

Even if vaccines become available to the public in the coming months to address the COVID-19 pandemic, how will the hundreds of millions of doses get to people in an evenly distributed way? Experts tell Crain’s there is a general distribution plan, but it is highly variable depending on which of the half-dozen coronavirus vaccines and the amount of doses are available. The federal government still hasn’t made a final decision on which populations will be first to receive the vaccines. Health care workers, first responders and those elderly or at high risk for infection will likely be the first to be inoculated in the opening weeks as

A health worker injects a person during clinical trials for a COVID-19 vaccine at Research Centers of America; several different vaccines are now in late-stage testing. | BLOOMBERG

NEWSPAPER

REAL ESTATE Big deal: Friedman sells Troy Technology Park in one of 2020’s priciest sales. PAGE 4

Ryan Hertz, CEO, Lighthouse Michigan

COVID-19 vaccine shipments roll down the highways to their designated distribution centers. Through the Advisory Committee on Immunization Practices, the U.S. Centers for Disease Control and Prevention will decide this fall which groups of people could receive an initial shipment of 100 million doses once the Food and Drug Administration grants approval, said CDC Director Robert Redfield in a statement last month. Once those decisions are made, Irving, Texbased McKesson Corp. will work with the CDC and the Department of Defense to ship COVID-19 vaccines to states and other pointof-care distribution sites. See VACCINE on Page 21

FOCUS | NONPROFITS  Merge? Close? Or something else? As nonprofits face down tough times, now is time for hard conversations. PAGE 10

THE CONVERSATION

Employment: Kapstone seizes growth opportunities in aerospace, energy. PAGE 3

Recently retired attorney Denise Lewis on diversity, development and Dan Gilbert. PAGE 38

Kapstone Employment Services cofounder Tammy Turner

CRAINSDETROIT.COM I OCTOBER 26, 2020

POLITICS

Amid a pandemic, lawmakers get fewer free lunches with lobbyists

ELECTION 2020

Several critical issues now facing Michigan will be of national importance in 2021. We asked journalists and thought leaders to explain why.

Lobbyist-paid meals for legislators down 62% through July; firms ponder strategies for 2021 BY CHAD LIVENGOOD

The Essay Issue Anna Clark: The state of Michigan’s cities | PAGE 25 Rick Haglund: The automotive economy faces the future | PAGE 26 Dustin Walsh: How tariffs harm manufacturing and agriculture | PAGE 26

A steep decline in lobbyist-paid lunches and dinners for Michigan lawmakers this year because of the coronavirus pandemic has altered the way the state's advocacy industry gets access and information to decision-makers in the halls of power. Meals and drinks paid for by multiclient lobbying firms, corporations, industry groups or individual lobbyists is on pace to be at its lowest level since the Great Recession ended in 2010, according to public disclosures of lobbying expenditures in the first seven months of this year. The coronavirus pandemic has upended the way registered lobbyists communicate and interact with the Legislature's 148

members and key officials in Gov. Gretchen Whitmer's administration. Much like other professional services, communication has moved to Zoom video conference call screens — mostly wiping out the time-honored tradition of dinners and schmoozing in Lansing's finer dining establishments. “No one is doing lunch anymore — very rarely, once or twice," said Matthew Miner, CEO of Capitol Strategies Group Inc., a multiclient lobbying firm in Lansing. Through July 31, lobbyist expenditures for food and beverages were under $220,000. Much of that spending came in the first quarter of the year, before the public health emergency prompted an immdiate halt to business travel, large group meetings and restaurants were shuttered in the spring. See LOBBYISTS on Page 36

Eric Freedman: Why the Detroit River is a bellwether of environmental quality | PAGE 28

INSIDE

Laura Berman: Women in politics need to play the long game | PAGE 29

NAMES TO KNOW IN LOBBYING

Nia Winston: Labor, equity and the pandemic | PAGE 30

 A who’s who of movers, shakers and influencers. PAGES 12-22

TECHNOLOGY

Ann Arbor AI company Clinc looks to upscale under new CEO NEWSPAPER

BY NICK MANES

With a new chief executive and a growing focus on serving the financial services sector, AI startup Clinc Inc. still has some “phenomenal” problems to overcome, according to new CEO Jon Newhard. The Ann Arbor-based company has gained buzzworthy attention in recent years as its Siri-like voice-controlled software has been put to use

in mobile-banking applications. However, the company has found both high times and low in the last 18 months. In May 2019 the company netted more than $50 million in new funding, and then in February this year Clinc found itself under the microscope as its co-founder and then-CEO Jason Mars left the company amid allegations of inappropriate behavior. Now, with a laser-eyed focus on

expanding within the financial services sector — particularly banking institutions — Newhard said he sees a bright future for the company. With Clinc possessing “great technology,” it would have been easy to get “spread ... too thin,” the 51-yearold said. So instead, the decision to focus on providing software to banks was an intentional one. See CLINC on Page 36

THE CONVERSATION

Detroit election workers brace for absentee ballots

JPMorgan Chase Co.’s Terrah Opferman steers middle market businesses through tough times PAGE 22

PAGE 3

CRAINSDETROIT.COM I NOVEMBER 2, 2020

WHAT THE VOTE MIGHT MEAN FOR BUSINESS We asked experts in sectors from health care to real estate to manufacturing how Tuesday’s vote will affect Michigan Eager for direction after a chaotic year, industry leaders in Michigan are tuning in closely to this year’s elections. Top of mind for executives across sectors is emerging from the COVID-19 pandemic and returning to some form of business as usual. A host of other issues, from immigration and trade policy to health care and tax plans, will have a big impact on what that looks like. Key to most sectors is a second federal stimulus or relief package, which has been held up for months. Whether Joe Biden takes the White House or President Donald Trump wins four more years, business leaders agree they are ready for 2020 to be over — the election, the pandemic, the uncertainty. SUPPLIERS

READ THE REPORTS, PAGES 20-21

CITIES ENERGY FINANCE & TECHNOLOGY HEALTH CARE HIGHER EDUCATION MANUFACTURING & SUPPLY NONPROFITS REAL ESTATE SMALL BUSINESS

WORKFORCE

Shyft Group shifts gears

Company rides wave of rising e-commerce spending

As COVID cases surge, big firms stress safety outside work

BY DUSTIN WALSH

BY CHAD LIVENGOOD

For 40 years, Spartan Motors operated out of a manufacturing plant and headquarters in Charlotte, a town between Battle Creek and Lansing of fewer than 10,000 residents. A

public company, but run by two generations of the Sztykiel family since its founding in 1975, it focused primarily on building firetruck engines and ambulances and expanded into delivery box trucks at the turn of the last decade.

NEWSPAPER

In 2014, Spartan Motors stock traded at a mere $5 per share and it ended the year with net income of only $1.2 million after a loss of $6 million the year prior. But it also ended that year with a new CEO in longtime auto supplier executive Daryl Adams. Adams led a major overhaul of the business, resulting in new lean processes, 12 new operations across the U.S., the sale of the company’s legacy emergency response vehicle business, a major contract with Amazon and a new headquarters in Novi and new name, The Shyft Group Inc. The move and name changed occurred in July of this year. See SHYFT on Page 17

After reporting $218 million in third-quarter profits, Consumers Energy Co. CEO Patti Poppe ended a quarterly earnings call with Wall Street analysts last Thursday using what she calls her “mom voice.” “Please be safe, be well and make sure to wear your darn mask,” Poppe said. Eight months into a global pandemic that has upended American life, some of Michigan’s business leaders are trying to reinforce their internal company and public messaging about the seriousness of the novel coronavirus amid a resurgence of infections, COVID fatigue and a divisive national election just days away.

As public health experts have predicted for months, the second wave of COVID-19 infections has arrived in Michigan, sending the seven-day average of new cases skyrocketing from 854 on Oct. 1 to 2,623 on Thursday and an 8.6 percent testing positivity rate. While the average number of deaths is a fraction of the first wave, the rapidly rising number of hospitalizations has some business and health care leaders warning that there may be worse days ahead as the holidays approach and families gather indoors, where transmission of the virus is most common. See COVID on Page 17

NEXT PLAY: Lions great Calvin Johnson’s marijuana business is catching his attention now.

THE CONVERSATION: Eric Larson, CEO of the Downtown Detroit Partnership. PAGE 26

PAGE 3

CRAINSDETROIT.COM I NOVEMBER 9, 2020

MANUFACTURING

ELECTION 2020

CASH FLOW

7 months into pandemic, supply chain issues remain

Shortages still span a wide array of goods

POLITICIANS POURED $375 MILLION INTO MICHIGAN RACES. DID IT MATTER?

BILL OXFORD VIA ISTOCK/GETTY IMAGES

BY DUSTIN WALSH

BY NICK MANES | That feeling of being unable to

watch an NFL football game or local news without being bombarded with political commercials the last several months wasn’t just a feeling. Political advertising hit an all-time record in Michigan in the run-up to last week’s election. An Election Day report from the Lansing-based money-in-politics watchdog organization Michigan Campaign Finance Network (MCFN) found that the $375 million spent on just television, cable and radio advertising in the state outpaced the total spending of $324 million in the 2018 midterm elections.

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That political spending means a windfall for local television networks, which stand to receive about $151.1 million in revenue from political ad spending this year, according to data from Advertising Analytics and analyzed by MCFN. Of that money about $125 million comes from just two races: the presidential race between incumbent President Donald Trump and former vice president Joe Biden, as well as the U.S. Senate race between incumbent Democrat Gary Peters and GOP challenger, Detroit businessman John James. See SPENDING on Page 24

LON HORWEDEL

TV stations clean up, but money doesn’t equal victory

Q&A: GOP fundraiser Ron Weiser on money in politics, affordable housing in Ann Arbor and his health. PAGE 24

2020

VETERANS

THEIR STORIES, PAGES 15-20

For Belinda Kusibab, a trip to the home improvement store is a treasure hunt. The owner of Romeo-based Queen Bee Soiree scours the lumber aisles in search of 1-inch thick square edge whitewood boards across the metro region’s Home Depot and Lowe’s stores. She uses the thin boards to make square pallet boards for ever-popular painting parties. But more often than not, her search is futile. Lumber is part of a long list of products that remain in short supply more than seven months after the COVID-19 pandemic tossed supply chains off course. From lumber yards to manufacturers, demand continues to outstrip supply in an economy that ruptured then nearly recovered in record time. “The most popular medium people like to paint on is wood,” Kusibab said. “I’m now forced to find the materials before I can schedule a class where before I could book a class and find the wood just about anywhere.” Access to the common boards is important to her business. Kusibab charges $45 a head for her wood-painting courses, compared to just $35 a head for a canvas class. At Mans Lumber in Trenton, lumber deliveries remain erratic. “It’s a mess,” said Chris Mans, co-owner and vice president of sales. “When everything shut down in March ... That’s when lumber yards and box stores prepare for the year. But none of us knew what the hell was going to happen and we were caught unexpectedly with overwhelming demand and limited supply.” Mans employs 135 across lumber yards in Canton, Trenton and Ann Arbor. It also operates a showroom in Birmingham. See SUPPLY on Page 25

THE CONVERSATION Dave Bing looks back on the many roles he’s had

Hunting businesses get a boost PAGE 3

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CRAINSDETROIT.COM I NOVEMBER 16, 2020

THE LAME-DUCK AGENDA

A SESSION LIKE NO OTHER

DALE YOUNG FOR CRAIN’S DETROIT BUSINESS

SPECIAL REPORT | PAGES 13-18

The Michigan Legislature’s biennial session in December is always a frenetic three weeks of lawmaking before a third of the state House members leave office due to term limits. This year’s lame-duck session is clouded by a once-in-a-lifetime global pandemic that’s worsening as COVID-19 infections, positivity rates and hospitalizations soar. In Crain’s Forum this month, we take a look at issues that may bubble up in the Legislature’s year-end session and how the fragile relationships among leaders in Lansing could shape state government’s COVID-19 response in the coming winter months. LAW

Law schools hope to stem enrollment slide Pandemic could help reverse a decade-long decline BY KURT NAGL

The U.S. legal industry took a beating during the Great Recession of 2008-09 from which it never fully recovered. And while the COVID-19 pandemic has caused

another economic downturn, industry observers are not predicting the same doom and gloom as a decade ago. In some cases, bad times are good for business. Law firms in Michigan are report-

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ing a rebound in work as industries tentatively reboot. Predictably, demand for employment and cybersecurity attorneys is surging as companies untangle a mess of issues related to layoffs, workplace safety and the work-from-home shift. At the same time, the public health crisis and national spotlight on social justice issues is spurring new interest in the legal field. That’s cause for cautious optimism from law schools in Michigan and around the country, many of which are a fraction of their former size. For others, however, the downsizing likely isn’t done. See LAW SCHOOL on Page 20

MORE ON THE ISSUES OF THE LAME-DUCK Infrastructure: Roads not on the agenda. PAGE 16 PACE: Metro Detroit elder care under scrutiny. PAGE 16 Unemployment: Benefit relief is set to expire. PAGE 17 Tax Relief: Should small businesses get a break? PAGE 18 CRAINSDETROIT.COM/CRAINSFORUM

FINANCE

To house growth, United Wholesale buys an arena BY KIRK PINHO

Pontiac-based United Wholesale Mortgage is buying the Ultimate Soccer Arenas property near its headquarters for yet another expansion of its corporate campus in the Oakland County seat. The company, formerly known as United Shore Financial Services LLC, said Thursday that an affiliate is paying $23.3 million for the 378,400-square-foot building at 867 South Blvd., part of which will be turned into office space for its growing staff and the remainder of which will be kept as indoor soccer fields. It’s another big real estate move for UWM, which said in September

that it intends to go public in a deal expected to be worth about $16 billion, not long after crosstown rival Rocket Companies Inc. (NYSE: RKT) announced its IPO. UWM said it has added nearly 3,000 employees in 2020 alone, bringing its current workforce in Pontiac to more than 7,000. An estimated 2,000 people would work in the western portion of the soccer building; construction is expected to begin soon and be complete by March. That space is about 180,000 to 200,000 square feet, said Mat Ishbia, UWM’s founder and CEO. See SOCCER on Page 19

SMALL BUSINESS The health of small firms is top of mind for Brian Calley.

WORKFORCE: Employee health and wellness during COVID and beyond. PAGE 8

PAGE 18 CRAINSDETROIT.COM I NOVEMBER 23, 2020

COPING WITH COVID-19

DESPERATE TIMES Cutter’s owner Chuck Nolen said he is down $500,000 in revenue from last year. | ANNALISE FRANK/CRAIN’S DETROIT BUSINESS

Also in this package

Small business owners in Michigan worry that ‘pause’ could be death knell

 Commercial landlords should brace for a rough ride. Page 16

BY KURT NAGL, JASON DAVIS AND ANNALISE FRANK

All Paul Glantz wants for Christmas is his business back. That’s at the top of the wish list for owners of movie theaters, bowling alleys, entertainment venues and dinein restaurants in Michigan forced to

close again right at the start of the busy holiday season. Worries abound that the “threeweek pause,” imposed by the state to beat back a surge of COVID-19 cases, could extend through the holidays and sound the death knell for many struggling small businesses. Glantz, chairman of Troy-based

Emagine Entertainment Inc., said revenue loss for his chain of 21 movie theaters has topped $40 million since the pandemic started in March. Theaters were closed for more than half a year before being allowed to reopen Oct. 9, while the ban on dining in lifted June 8. “To put us out of business again, I believe, is unjust and wrongful,” Glantz

 COVID-19 safety compliance complaints surge, overwhelming state oversight. Page 17

said business suffered from a lack of new product from Hollywood and a hesitation among guests to return. See DESPERATE on Page 16

HEALTH CARE

ENERGY

Poppe faces big challenges in new role BY JAY GREENE

CMS Energy CEO Patti Poppe is taking on a big new job heading up a bigger company that has had some of the biggest problems in the utility industry. Poppe was named last week as the next CEO of the mammoth Pacific

Gas & Electric Co. The challenge is huge: PG&E has faced years of criticism for lack of infrastructure maintenance that led to a guilty plea to 84 counts of manslaughter earlier this year for deaths in a fire caused by its equipment. Poppe, 51, who has served as president and CEO of CMS Energy (NYSE:

CMS) and Consumers Energy since 2016 after joining the company in 2011, will step down effective Dec. 1. An industrial engineer by training, she Poppe worked at General Motors Co. for 15 years before joining DTE Energy Co. in 2005 for five years. See POPPE on Page 17

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said. “I question whether our governor ever has studied actual science or data.” It is not the shutdown orders alone that crushed “dinner and a movie” and other conventional entertainment options — the general fear of the coronavirus has led to more reclusive lifestyles. Even in the short time open, Emagine was still losing money. Glantz

Hospitals gear up for long winter surge as beds, ICUs fill BY JAY GREENE

Hospitals are gearing up for a catastrophic surge of COVID-19 patients over the next three months that could result in another 200,000 deaths nationwide and stretch the limits of staff, bed and intensive care capacity, and the availability of personal protective equipment. Many critical care doctors, nurs-

WHAT ARE MICHIGAN’S TOP 3 PRIORITIES FOR STATE HEALTH REFORM? READ THE REPORT AT crainsdetroit.com/MAHP

es and other health care workers expect to work 12- to 16-hour shifts to take care of the numbers of increasingly ill patients — not just from the coronavirus, but from a combination of influenza and the normal winter uptick in medical activity with heart attacks and strokes that typically happen at the end of the year, experts say. See HOSPITALS on Page 16