Crain's Detroit Business

By Bill [email protected]

Leaders at Detroit-based mar-keter CCaammppbbeellll EEwwaalldd sought a mapto guide a restructuring at the be-leaguered agency, and it turned outto be a literal type of map that ishelping the firm adapt to a chang-ing advertising world.

The firm in the past year hasbegun using a heavily customizedpaper and digital system to mapcustomer relationships for theirclients, and management has said itis part of the path to reverse five

years of flagship client losses and fi-nancial declines.

The agency developed what it callsthe Consumer Experience JourneyMap last year, and Campbell EwaldCEO Jim Palmer said it has been usedin pitches to six new client wins in thepast five months and to manage cur-rent clients more effectively.

“This is one of the main reasonswhy we’re winning what we’re win-ning,” Palmer said.

The client management system,which is similar to project manage-ment tools used by computer pro-

grammers, is part of Palmer’s busi-ness strategy to reshape the agencyinto what he calls “Campbell Ewald2.0” as it adapts to the changing de-mands of modern advertising.

Other elements of the strategy in-clude new senior management hiresand refocusing the agency on doingmore quick-turn digital contentwhile focusing on social media andreal-time analytics, and applying thebrakes to the old-school (and expen-sive) advertising habits of months-long TV commercial shoots.

By Robert [email protected]

Detroit’s two multibillion-dollarpension funds for city workers arepoised to invest money for the firsttime since the cityemerged from bank-ruptcy and a publiccorruption scandalcost retirees more than$97 million.

The funds control$5 billion in assets andare at a pivotal mo-ment to pick new in-vestments designed toreap returns for morethan 25,000 retirees,active workers andbeneficiaries reelingfrom pension andbenefit cuts thathelped Detroit exit thelargest municipalbankruptcy in U.S. history almostone year ago.

The pending investments followa lengthy review of the funds’ in-

vestment portfolios and changesmade in asset allocation.

The post-bankruptcy landscapeincludes pension fund babysittersand new investment rules aimed at

preventing the sortof bribery and kick-back scandals thatsaw five former pen-sion officials andbusinesspeople con-victed of federalcrimes this fall.

All investmentsare being overseenby independentcommittees popu-lated by people withfinance and invest-ment backgrounds,including membersappointed by Gov.Rick Snyder. That’s anew level of over-

sight and replaces the old system ofpension fund boards approving in-

By Kirk [email protected]

Nearly 100 years ago, the 40-story CCaaddiillllaacc TToowweerr indowntown Detroit was one

of the tallest buildings in NorthAmerica.

Today, it is trying to regain itsplace among giants.

With a $4 million lobby renova-tion nearing completion in January,the owners of the 88-year-old build-ing on Cadillac Square just a stone’sthrow from Campus Martius Parkhave broader ambitions.

Discussions between the owners,Brooklyn-based CCaappiittaall IInnvveesstt AAll--lliiaannccee, and several undisclosed hotelbrands are underway for a possibleconversion of up to nine floors intohotel space, said Paul DeBono, vicepresident of Southfield-based FFaarrbb--mmaann GGrroouupp, which leases the proper-ty to tenants and manages it.

That could mean the first hotelrooms that close to Campus Mar-tius, DeBono said. He envisions aboutique hotel, along the lines ofwhat’s proposed for the formerWWuurrlliittzzeerr CCoo.. building on BroadwayStreet downtown by New York City-based AAsshh NNYYCC, which is underwaywith a $20 million conversion of thebuilding into a 97-room hotel.

Residential space is also beingconsidered, but there are no activeplans for it, he said.

Then, of course, there is thedearth of large blocks of quality of-fice space in the central businessdistrict. With the city of Detroit for-mally vacating its 172,000 squarefeet in the building just over amonth ago, Farbman is now mar-

© Entire contents copyright 2015 by Crain Communications Inc. All rights reserved.

crainsdetroit.com Vol. 31 No 48 $2 a copy. $59 a year.

NE

WS

PA

PE

R

CRAIN’SDETROIT BUSINESS

Readers first for 30 Years

NOVEMBER 23-29, 2015

City pension fundsto resume investing

New rules aim to prevent bribery, kickbacks of old

Hotel rooms, offices,restaurant among

plans for the Cadillac

Paper and digital strategy helps agency win clients, reverse declines

LARRY PEPLIN

Campbell Ewald CEO Jim Palmer (left) and Kevin Wertz, president of its Detroit,Los Angeles and San Antonio offices, are winning business with a customer “map” tool.

SEE PPEENNSSIIOONNSS, PAGE 24

JOHN D’ANGELO

The revamp of the Cadillac Tower includes plans for a totally new lobby, alreadyunderway, along with talks for a substantial conversion of floors to hotel space.

SEE AAGGEENNCCYY,, PAGE 24

SEE CCAADDIILLLLAACC, PAGE 23

Pension factsDDeettrrooiitt GGeenneerraallRReettiirreemmeenntt SSyysstteemm

■ Assets: $2 billion

■ Liabilities: $3.2 billion

■ Active members: 5,389

■ Retirees: 9,737

DDeettrrooiitt PPoolliiccee && FFiirree RReettiirreemmeenntt SSyysstteemm

■ Assets: $3.3 billion

■ Liabilities: $4 billion

■ Active members: 3,164

■ Retirees: 9,228

Campbell Ewald maps future

Pie makers rev up forcrimp-a-thon to make their

holiday dough,PAGE 3

TOWERambitions

TOWERambitions

20151123-NEWS--0001-NAT-CCI-CD_-- 11/20/2015 5:16 PM Page 1

A BETTER PARTNERSHBy providing discerning and proactive lecounseel, we build a better partnership w

868686868686868686886886666.6.6.66.6.66.666.6.6.6..66..6 535353535353535353553553555333.3333.3.3.33.3.3.333.33..3..303030303030303033033330303033330181818181818181818181818181818888888881888888811818118118

IP®®egal

with cllients.

Protect your intellectual property and put it to work

When you’ve captured the proverbial “lightning in a bottle,” protecting it and putting it to work go hand-in-hand. This is the foundation of our approach, which includes:

1. understanding the potential for your vision;

2. developing a practical strategy for protection and commercialization; and

3. defending your IP with a formidable litigation team.

With this sound foundation, your IP can work harder and smarter for you. Learn more at WNJ.com.

Las Vegas company to bringbig data to Grand Rapids

Not everything hatched in Vegasstays in Vegas. The Las Vegas datacompany SSwwiittcchh has announcedplans to build a high-tech data cen-ter near Grand Rapids that it saidwould be the largest such facility inthe eastern U.S.

Pending approval of tax breaks byMichigan lawmakers, Switch wouldcreate a $5 billion, 2 million-square-foot Supernap data center campusin Caledonia, in and around a pyra-mid-shaped building formerlyowned by SStteeeellccaassee IInncc.., The Associ-ated Press reported.

Switch, which has sites in LasVegas and Reno, Nev., said part ofthe appeal is that Michigan is farfrom traditional earthquake zonesand other natural risks on thecoasts. Switch customers includesome of the biggest names in bank-ing, entertainment and technology.

Meanwhile, EEdduuccaattiioonn CCaammppuuss IInn--vveessttoorrss, an education group thathoped to buy the iconic Steelcasepyramid, filed a lawsuit last week,claiming the office furniture com-pany and its real estate broker re-

neged on a deal to sell the propertyfor $3 million last May, MLive.comreported.

Mich. Tech bowling alleybecomes linchpin for ideas

The basement of MMiicchhiiggaann TTeecchh’sMemorial Union used to be a placefor knocking down bowling pins. Bynext semester, if renovations gowell, it will be a place for buildingup dreams.

About 100 Tech students, facultyand staff recently gathered at theunion to brainstorm that transfor-mation and help design MichiganTech’s first makerspace — a lab,workshop and hangout where any-one in the university communitywill be able to go to turn their ideasinto prototype realities, accordingto The Daily Mining Gazette ofHoughton.

The ideas at the gathering wereturned into floor plans and debatedby groups that merged them intoproposals, sometimes even model-ing them out of Play-Doh and pipecleaners. It was not immediatelyclear if the public would be able touse the makerspace.

MICH-CELLANEOUS

� Matthew Missad, CEO of Lans-ing Township-based UUnniivveerrssaall FFoorreessttPPrroodduuccttss IInncc.., was named to Fortunemagazine’s Businessperson of theYear list, which ranks the nation’s top50 corporate leaders. Missad, CEO ofthe lumber products company since2011, was ranked 45th. Fortunenoted his rise from his initial workfor the company as a high schoolmaintenance crew member to hisrecent overseeing of Universal’s firstacquisition outside of North Ameri-ca, in the Australia market.

� Grand Rapids tech firm AApppprroo--ppooss LLLLCC has expanded its operationsto Germany by opening a sales andsupport office in Munich to supportdeployment of its Envoy software-as-a-service platform, MiBiz report-ed. The Envoy platform — describedas the “Swiss Army knife” of whole-sale business-to-business software— allows sales personnel and retail-ers to order products, check invento-ry, digitally display product andmore, said the 4-year-old company.

� Even as Flint’s recent watercontamination crisis was widelypublicized, the city has been mak-ing quiet progress on another front.The GGeenneesseeee CCoouunnttyy LLaanndd BBaannkk AAuu--tthhoorriittyy has demolished more than1,766 blighted houses in Flint since2014, using federal grant money.That, reports Bridge Magazine, ex-ceeds its stated goal of 1,600 homedemolitions when the city wasawarded more than $20 million in

federal blight-removal funds in 2013.The Flint program also boasts loweraverage demolition costs than thosein Detroit, which received more thantwo times as much funding.

� SSppaarrttaannNNaasshh is remodeling sixof its Michigan grocery stores, in-cluding FFaammiillyy FFaarree stores in Hol-land, Zeeland and Marshall andDD&&WW FFrreesshh MMaarrkkeett outlets in GrandRapids and Petoskey, MLive.com re-ported. SpartanNash is based inByron Township near Grand Rapids.The remodels either have beencompleted or will be by year’s end.

� Lt. Gov. Brian Calley signed anexecutive order designed to bringincreased job opportunities forpeople with disabilities, The Associ-ated Press reported. The order es-tablishes Employment First inMichigan, which seeks to improveaccess to workplace support andservices for people with disabilities.

� The Lansing region is takingsteps to develop its fledgling particleacceleration industry. The LLaannssiinnggEEccoonnoommiicc AArreeaa PPaarrttnneerrsshhiipp created astrategic plan to attract new busi-nesses to the region that relate to re-search at MMiicchhiiggaann SSttaattee UUnniivveerrssiittyy’sNational Superconducting Cy-clotron Laboratory and elsewhere,the Lansing State Journal reported.The plan identifies nearly 200 busi-nesses globally that could supportthe growing industry in Lansingthrough advanced manufacturing,biomedical engineering and infor-mation technology.

� Downtown Muskegon will soon

have a new hangout with theplanned opening of a distillery.Michael Brower, co-owner of PPiiggeeoonnHHiillll BBrreewwiinngg CCoo.., and Mark Fellwock,co-founder of the Holland-basedCCooppppeerrccrraafftt DDiissttiilllleerryy, announcedthe creation of 1188tthh AAmmeennddmmeenntt SSppiirr--iittss CCoo.., MLive.com reported. The dis-tillery will house a craft distillery bar.

� The news was bleak, at best, fortwo long-popular major-metro areadance halls. In Bay City, the ownersof PPuullaasskkii HHaallll decided to significant-ly slash its sale price to $50,000 from$100,000 in an effort to sell themore-than-century-old hall, barand banquet facility long at the epi-center of the city’s Polish communi-ty. Meanwhile, MLive.com reported,demolition began on CClluubb LLuuddwwiigg,one of the Jackson area’s most pop-ular dance halls for nearly 60 years.The site owner said he hopes to re-place the club with — wait for it — afuneral home. �

INSIDETHIS ISSUE

BANKRUPTCIES . . . . . . . . . . . . . . . . . 22CALENDAR . . . . . . . . . . . . . . . . . . . . . . . 18CLASSIFIED ADS . . . . . . . . . . . . . . . . 21DEALS & DETAILS . . . . . . . . . . . . . . . 19OPINION . . . . . . . . . . . . . . . . . . . . . . . . . . 8OTHER VOICES . . . . . . . . . . . . . . . . . 8, 9PEOPLE . . . . . . . . . . . . . . . . . . . . . . . . . 20RUMBLINGS . . . . . . . . . . . . . . . . . . . . 26WEEK ON THE WEB . . . . . . . . . . . . . . 26

COMPANY INDEX:SEE PAGE 25

2 C R A I N ’ S D E T R O I T B U S I N E S S // N O V E M B E R 2 3 , 2 0 1 5

BRIEFSMICHIGAN


By Tom [email protected]

In one form or another, in oneplace or another, despite the likelyloss of major funding support fromthe MMiicchhiiggaann EEccoonnoommiicc DDeevveellooppmmeennttCCoorrpp., there will be a seventh annualAAcccceelleerraattee MMiicchhiiggaann IInnnnoovvaattiioonn eventnext November.

The MEDC allocated $1.35 mil-lion over the past two years for theevent, nearly half of AMI’s two-yearbudget of $3 million, but FredrickMolnar, the MEDC’s vice presidentof entrepreneurship and innova-tion, said his budget doesn’t haveanything earmarked for next year.

“We’re at the end of our budgetprocess, and Accelerate Michigan isnot on it,” said Molnar.

Despite that hit, David Egner, ex-ecutive director of the NNeeww EEccoonnoommyyIInniittiiaattiivvee ffoorr SSoouutthheeaasstt MMiicchhiiggaann, toldCrain’s: “The momentum is such,the event will go at least one moreyear, and I hope it will be able to goa few more years after that.”

Egner helped found AMI in 2010,and the NEI has been a major finan-cial supporter.

“We’re definitely a go for nextyear,” said Lauren Bigelow, theevent’s executive director.

Rumors and worries that the plugmight be pulled on one of the mostlucrative business plan competi-tions in the U.S. were swirling at this

By Jay [email protected]

Executives of HHeennrryy FFoorrdd HHeeaalltthhSSyysstteemm told Crain’s last week that thefive-hospital system’s growth planswill not be affected by the loss of alucrative regional Medicaid contractby its HHAAPP MMiiddwweesstt HHeeaalltthh PPllaann.

But when the state rejected HAPMidwest’s bid to continue serving87,000 Medicaid beneficiaries inSoutheast Michigan as it had for 35

years, Detroit-based Henry Ford ef-fectively lost 10 percent of its revenueand 20 percent of its net incomebased on projections for this year.

Henry Ford officials said Fridaythat they are negotiating a sale andtransfer of HAP Midwest Medicaidmembers in Southeast Michigan re-gions it lost to an unspecified healthplan.

The contract loss will also meanat least some job losses at HAP Mid-west, though Henry Ford Health istrying to place as many people aspossible in new jobs.

In mid-October, the MMiicchhiiggaann DDee--ppaarrttmmeenntt ooff HHeeaalltthh aanndd HHuummaann SSeerr--vviicceess, which administers Medicaidfor 1.7 million recipients, recom-mended 11 HMO contract winners

for six-year, $42 billion program.After six Medicaid HMOs ap-

pealed decisions late last month,the MMiicchhiiggaann SSttaattee AAddmmiinniissttrraattiivveeBBooaarrdd made final rulings last week.The contracts are expected to besigned within days.

“We are disappointed about HAPMidwest. It contributed financialbenefits” to Henry Ford, said Wright

Lassiter III, Henry Ford’s president.“We are financially strong this yearand expect a strong financial yearnext year. This doesn’t change anydecisions we have made.”

For the first nine months of thisyear, Henry Ford generated net in-come of $104 million on revenue of$3.77 billion for a 2.8 percent mar-gin, according to the system’s unau-dited financial statement.

3C R A I N ’ S D E T R O I T B U S I N E S S // N O V E M B E R 2 3 , 2 0 1 5

Henry Ford: Contract loss won’t hurt growthHealth system says it’s negotiating sale, transfer of HAP Midwest Medicaid members

Despite fundinguncertainty, officialsconfident … of next year

Interest piquesBankers beyond primed for rising rates asFed gets ready to end eight years ofrecord lows, Page 11

Connecting through the decadesJoseph Hudson Jr. reflects on a lifetime nearcenter of local corporate, civic, philanthropic life, Page 4

MUST READS OF THE WEEK

SEE HHAAPP, PAGE 23

AccelerateMichigan:The showmust go on

By Vickie ElmerSpecial to Crain’s Detroit Business

For pie makers, today’s the start of an enor-mous bake-a-thon. Instead of their normal10-hour stints, the ovens at GGrraanndd TTrraavveerrssee PPiiee

CCoo..’s 15 stores will run a nonstop 50,000-piemarathon this morning through Wednesday.

At ZZiinnggeerrmmaann’’ss BBaakkeehhoouussee, all the marketing andaccounting staff come into the Ann Arbor kitchensto crimp the edges of pies, box them or otherwiselend a hand. Pie sales are expected to grow 20 per-cent from last year.

AAcchhaattzz HHaannddmmaaddee PPiiee CCoo.. calls in former staffersand “kid brothers” for this busiest week of the year.Co-owner Wendy Achatz figures the company sellssix normal weeks’ worth of pies on just the Wednes-

day before Thanksgiving. “It’s crazy ... a really toughjuggling act,” she said.

Welcome to the World Series of pie, the time when“everybody’s in the kitchen,” as Sara Whipple ofZingerman’s Bakehouse said.

Pie production peaks this time of year, with salesnationwide in late November almost seven times ashigh as they are during a normal week in March orMay, according to Nielsen data. December brings asecond big wave of pie buyers, but demand is morespread out. “People party for the whole month, andwe’re rocking and rolling,” said Achatz.

For Thanksgiving, though, the rush for pumpkinor apple or berry pies is compressed into just two orthree days. While many smaller pie shops and bak-

Let them make pieFor busy bakers, ‘everybody’s in the kitchen’ for holidays

LON HORWEDEL

Amy Emberling, co-managing partner and owner of Zingerman's Bakehouse, places dough into pie tins before takingthem off to a dough press and hand-crimping the top of the crusts at the Ann Arbor bakery last week.

SEE PPIIEESS, PAGE 25 SEE AACCCCEELLEERRAATTEE, PAGE 22



www.hitachibusinessfi nance.com

› A/R Financing› Lines of Credit

(248) 658-1100

EXPANDING: Machine manufacturer with a $1 million line of credit

Helping staffi ng companies, consultants, distributors and more with business cash fl ow solutions.

Prior to award, Hudson reflects on community serviceQ&A: JOSEPH HUDSON JR.

By Sherri [email protected]

When Detroit was burning,Michigan’s governor and Detroit’smayor came to JJoosseepphh HHuuddssoonn JJrr..

At their behest, Hudson con-vened NNeeww DDeettrrooiitt, the first urbancoalition in the U.S., to look at whatwent wrong leading up to the De-troit riots in 1967, what needed tochange in terms of racial disparitiesand inequities, and how to makethat change happen.

That’s just one of many corpo-rate, civic and philanthropic hatsHudson, 84, has worn during his 59-year career.

The retired chairman and CEOof JJ..LL.. HHuuddssoonn CCoo. departmentstores and vice chairman and di-rector of DDaayyttoonn HHuuddssoonn CCoorrpp. waselected in 1985 as the first presi-dent and CEO of the newlymerged DDeettrrooiitt MMeeddiiccaall CCeenntteerr, arole he held for five years.

He has served on many corpo-rate and nonprofit boards and ledthe CCiittyy ooff DDeettrrooiitt AArrttss CCoommmmiissssiioonnfor 11 years and the UUnniitteedd FFoouunnddaa--ttiioonn, now known as UUnniitteedd WWaayy ffoorr

SSoouutthheeaasstteerrnnMMiicchhiiggaann.

Hudson wasfounding chair-man of the CCoomm--mmuunniittyy FFoouunnddaa--ttiioonn ooff SSoouutthheeaassttMMiicchhiiggaann and wasa director of DDee--ttrrooiitt RReennaaiissssaannccee,now known asBBuussiinneessss LLeeaaddeerrssffoorr MMiicchhiiggaann, for

17 years until 2007.And he continues to serve on the

boards of organizations includingthe Community Foundation; theDDeettrrooiitt IInnssttiittuuttee ooff AArrttss, as an emeri-tus trustee; and the HHuuddssoonn--WWeebbbbeerrFFoouunnddaattiioonn, for which he has been a

trustee since 1956.He holds honorary doctor of hu-

manities degrees from the UUnniivveerrssiittyyooff DDeettrrooiitt MMeerrccyy, WWaayynnee SSttaattee UUnniivveerr--ssiittyy and MMiicchhiiggaann SSttaattee UUnniivveerrssiittyyand has received numerous awards.Soon, he’ll receive another.

Hudson will be presented withthe Alan E. Schwartz CommunityLeadership Award at a Dec. 1 DDeettrrooiittEEccoonnoommiicc CClluubb luncheon in recogni-tion of his work, spirit and commit-ment to the region.

Hudson spoke with Crain’s seniorreporter SShheerrrrii WWeellcchh last week abouthis past contributions, changes incorporate philanthropy, progressmade on racial equality, endow-ments and work that remains.

WWhhaatt lleedd ttoo tthhee ffoorrmmaattiioonn ooff NNeewwDDeettrrooiitt??

New Detroit was formed severaldays after the Saturday night riots.There was no charter and no othersimilar organization in the nationand no agenda to start. We were allinvited by the governor and mayorto come together to share what wefound in terms of needs to be ad-dressed in the community.

That broke down to a large seriesof issues: police-community rela-tions, fair-employment practices,housing, public recognition ofneeds for health care — the wholepanorama of services and relation-ships.

I invited 39 people to serve on thecommittee, CEOs for major corpo-rations and a number of peoplewho were providing communityservice. And quite surprising tomany people in the community, Iinvited three fairly young commu-nity activists — they were blackmen. We also had a number of blackwomen involved in communityservice.

That diversity on the committeebrought us down to earth at the veryfirst meetings. Everyone would goaround the table and talk about hisperspective. Because of the urgencycoming out of the riots, the firstyear, we set an aggressive agenda ofwhat needed to be addressed andimprovements.

In the early years of New Detroit,there was a high level of visibility forNew Detroit and a lot of action thatresulted. Corporations led thecharge.

WWhhaatt aabboouutt tthhee yyeeaarrss ssiinnccee tthheenn?? IIsstthheerree wwoorrkk yyeett ttoo bbee ddoonnee oonn iimmpprroovviinnggrraacciiaall ddiissppaarriittiieess aanndd rreellaattiioonnss??

In different parts of the country,there continues to be racial tension.What was an instructive process in1967 still needs to be addressed.There are still plenty of things in theDetroit community that need to beaddressed. The public school sys-tem is totally inadequate. One canbe hopeful the groups that havecome together in the last year canget down to identify programs andfinancing that will bring Detroit outof the nation’s bottom learningrecords to high levels of perform-

ance. That’s just one of many thingswe have to continue to work on.

OOnnee ooff tthhee cchhaarrggeess ooff tthhee CCoommmmuunnii--ttyy FFoouunnddaattiioonn hhaass bbeeeenn bbuuiillddiinngg eenn--ddoowwmmeennttss iinn tthhee rreeggiioonn.. AArree wwee mmaakkiinnggpprrooggrreessss oonn tthhaatt ffrroonntt??

The idea came along that we werenot taking advantage of what citieslike Chicago, Cleveland and NewYork had with organizations workingon endowments. We were very late toleaving assets in the communitythrough private, family foundations.When I was first getting involved incivic activities, there were olderfoundations like KKrreessggee, MMccGGrreeggoorr,SSkkiillllmmaann and Hudson-Webber. Butprivate support came largely fromindividuals and corporations.

Fast forward to 2015, and youhave the RRaallpphh CC.. WWiillssoonn JJrr.. FFoouunnddaa--ttiioonn that was established with $1.2billion in assets. Before that therewas the (WWiilllliiaamm) DDaavviiddssoonn FFoouunnddaa--ttiioonn and the (FFrreedd AA.. aanndd BBaarrbbaarraa MM..)EErrbb FFoouunnddaattiioonn. It’s more in stylethese days for families who’ve beenleaders in the community and en-joyed good economic advantages toleave bequests to create founda-tions. We’re making tremendousprogress.

AArree nnoonnpprrooffiitt aaggeenncciieess aanndd iinnssttiittuu--ttiioonnss mmaakkiinngg pprrooggrreessss oonn tthhee eennddooww--mmeenntt ffrroonntt??

Every one of the cultural organi-zations got caught in the bad years,suffered badly from not having en-dowments to carry them through.They suffered dramatic program-matic cutbacks. With the Commu-nity Foundation picking up mo-mentum over the past 25 years,every civic or cultural organizationrecognizes they need to build theirown endowment.

The community still suffers fromtoo modest of endowments, butnonprofits are out there aggressivelyraising permanent endowment. TheCommunity Foundation has grownto $750 million in assets. At the sametime, you have all the individual cul-tural institutions and certainly theeducational institutions in the statehaving very rapid growth in endow-ment support. The need for endow-

ment and growing them has been arecognized emphasis. And we’repicking up pace on it.

WWhhyy iiss iitt iimmppoorrttaanntt tthhaatt oouurr ccuullttuurraalliinnssttiittuuttiioonnss aanndd ootthheerr nnoonnpprrooffiittss hhaavveeaann eennddoowwmmeenntt iinn ppllaaccee??

Organizations have all sufferedthrough economic down periods,having to cut staff and programs. Inthe good years, you need to raiseendowment to have stability duringtough times.

HHooww hhaass tthhee pprriivvaattee sseeccttoorr’’ss cciivviiccaanndd lleeaaddeerrsshhiipp rroollee iinn tthhee rreeggiioonncchhaannggeedd oovveerr tthhee ppaasstt ccoouuppllee ooffddeeccaaddeess??

I find there still is a large, enthusi-astic pool of people committed topublic service, whether it’s civic orcultural activity. When I first got in-volved with United Way, there was agive-once-for-all campaign. It wasfelt there was always a proliferationof agencies running independentcampaigns.

Detroit was a leader in the way ofraising monies for agencies as give-once-for-all. That was bought intoby corporations and labor unions.The drive included health care insti-tutions and other civic needs andwas made through payroll deduc-tion. There are many more cam-paigns now. That is a difference.

Detroit in those days — the ’50s,’60s and ’70s — also had a lot of cor-porate national headquarters here,with three or four national banksand several utilities. Through con-solidations, there aren’t as manymajor corporations to draw upontheir hierarchy as there once were.

It’s interesting how it’s developed.Looking at the banking community,for example, NBD went through anumber of iterations and now ispart of JJ..PP.. MMoorrggaann CChhaassee && CCoo.. J.P.Morgan has invested millions ofdollars in Detroit in recent years.They’re working, in a sense, like a lo-cally headquartered company, con-tinuing the tradition of what hadcome before. Others in the bankingcommunity are not as forthcomingafter moving their headquarters.But J.P. Morgan’s support shows anout-of-town company can still de-liver important assistance.

My own company, all that’s left isTTaarrggeett stores. They started with aphilosophy Dayton’s had of being avery strong philanthropic contribu-tor, as Hudson’s had been. Targetcontinues that in the community. Itis possible for companies head-quartered out of town to supportthe community, and we’re gettingquite a few.

WWhhaatt aarree yyoouu pprroouuddeesstt ooff wwhheenn yyoouullooookk bbaacckk??

I am very fortunate to be healthy,live in Detroit and still participate innumerous civic activities with well-qualified volunteers working on therenaissance of Detroit. We aremaking progress. �

Sherri Welch: (313) 446-1694Twitter: @SherriWelch

Joseph HudsonJr.: Honored for hiscommitment.

About the awardJoseph Hudson Jr. will be presentedwith the Alan E. SchwartzCommunity Leadership Award at aDDeettrrooiitt EEccoonnoommiicc CClluubb luncheon inrecognition of his work, spirit andcommitment to the region.

Detroit Free Press columnistRochelle Riley will talk with Hudsonabout lessons from the past, shiftsin community and philanthropicleadership over the years andexciting plans for the future.

WWhheenn:: 11:30 a.m.-1:30 p.m. Dec. 1

LLooccaattiioonn:: MotorCity Casino Hotel

TTiicckkeettss:: $45 members, $55 guestsof members, $75 nonmembers. Formore details or to buy tickets, go toeconclub.org.


vzw.com/myrep

The holidays are coming.

Get your business ready with

the best devices on the best

network. So you can easily

handle more customers and

more sales. Better matters.

Save up to $400 when you

trade in your phone and buy

a new 4G LTE smartphone.New 2-yr activation on $34.99+ plan required. $400 = $150 instant credit*

+ $150 bill credit + $100 smartphone trade-in credit.

Avoid being overrun by the holiday rush.

Offer expires 12/31/15. Account credits applied within 2-3 billing cycles. Trade-in must be in good working condition. Bill Credit will be removed from account if line is suspended or changed to non-qualifying price plan after activation. Bill credit not available on upgrades.

*Devices eligible for instant discount: Kyocera Brigadier, BlackBerry Classic, LG G3, Samsung Galaxy S5 16GB, DROID Turbo 32GB, DROID Turbo 64GB, Samsung Galaxy Note 4, LG G Pad 10.1, Novatel 6620, Samsung Galaxy Tab® 4 10.1, LG G4, Samsung Galaxy

S6 32GB, Samsung Galaxy Note 5, Samsung Galaxy Tab E 9.6. Activation/upgrade fee/line: $40. IMPORTANT CONSUMER INFORMATION: Corporate Subscribers Only. Subject to Major Acct Agmt, Calling Plan, & credit approval. Up to $350 early termination fee/line.

Offers & coverage, varying by svc, not available everywhere; see vzw.com. While supplies last. Restocking fee may apply. DROID is a trademark of Lucasfilm Ltd. and its related companies. Used under license. © 2015 Verizon. 76375

DBpageAD_DBpageAD.qxd 11/18/2015 10:47 AM Page 1

6

Keep your business heading in the right direction.

Follow the latest market trends @firstmerit_mkt Member FDIC

2411_FM15

firstmerit.com

Treasury Management from FirstMerit Bank When John talked to FirstMerit Bank’s Treasury Management team, his goal was to increase his

company’s working capital. Together, they came up with a plan to help John effectively manage

receivables, control payments, and improve his company’s overall cash flow. Now John has all

the tools he needs to keep his business moving in the right direction — forward.

TO L E A R N MOR E, C ON T A C T : David Lochner, President, FirstMerit Michigan,at 248-228-1620 or [email protected].

Comprehensive labor-market analysis from WIN can help.www.win-semich.org/data-research

Struggling to make critical talent decisions?

Business driven. Data informed.

C R A I N ’ S D E T R O I T B U S I N E S S // N O V E M B E R 2 3 , 2 0 1 5

$5M gift targets OUbiz school, athletics

By Chad [email protected]

OOaakkllaanndd UUnniivveerrssiittyy has a $5 millioncommitment from alumni Craigand Ann Stinson as lead gifts towardenhancing its business school andathletics programs, the universityplans to announce Nov. 23.

Craig Stinson, a former CEO ofBBrreeeezzee IInndduussttrriiaall PPrroodduuccttss and advis-er to Chicago private equity firmWWiinndd PPooiinntt PPaarrttnneerrss, and his wife ex-pect to allocate about $3 million tothe business school and $2 millionto the the athletic department.

The gifts will go toward improv-ing the SSttiinnssoonn SSttuuddeenntt AAddvvaanncceemmeennttCCeenntteerr in the business school, andto naming a new SSttiinnssoonn FFaammiillyy SSttuu--ddeenntt--AAtthhlleettee DDeevveellooppmmeenntt CCeenntteerr.

Both departments are in need offacility improvements. Trustees inOctober authorized requests for ar-chitectural and design proposals forthe business school and athletics. Itexpects to review those in February.

It has not yet been determinedhow much of the donation wouldgo to facilities compared with stu-dent services and programs.

When Ann and I were studentshere back in the 1980s, the universi-

ty got about 80 percent of its totalfunding from the state. Now we get16 percent. It’s important to be ableto call upon donors and inspire oth-ers to give and be impactful,” CraigStinson said last week.

“Ann and I always felt like thebusiness school was in a kind ofback seat. And in the last 10 years,we have been working with the uni-versity to really help elevate its sta-tus within the OU community.”

OU President George Hynd saidabout 95 percent of recent OU grad-uates continue to live and work inMichigan, making the university atop producer of local talent.

Both Stinsons have business de-grees, Craig in finance and Ann inmarketing. Craig Stinson was partof the presidential search commit-tee that appointed Hynd and alsochairs the business school advisoryboard of visitors.

Both also said facility constraintsare a concern for the school, whichhad 8,000 students when they at-tended. The university reportedrecord fall enrollment of 20,711after 17 years of growth. �

Chad Halcom: (313) 446-6796Twitter: @chadhalcom


7

GIVING KIDS SPACE TO

BE HEALTHY KIDS FOR 10 YEARS IN SOUTHEAST MICHIGAN

HELP US REACH OUR GOAL! D K I O

M

www.dkwio.org

R

D K I O 10

M

.



On Nov. 25, 1985, Crain’s pub-lished a story about a Senate com-mittee in Lansing approving aBIDCO, an acronym for businessand industrial corporation, whosepurpose was to fill the gap in fundingfor new businesses between banksand venture capitalists.

It was a gap that wouldn’t be filledfor long or verysuccessfully.

The idea wasthat young busi-nesses that didn’thave pristinecredit or top-notch collateralwould pay morethan bank ratesfor BIDCO loansbut at a cheapercost than ven-ture capitalists

charged for equity investments.The Legislature approved BIDCOs

in 1986. At the time, a typical interestrate for one of their loans was about20 percent, with BIDCOs also oftennegotiating a share of revenue orwarrants to purchase stock at lowprices later as part of their deals.

It was briefly a growth industry.Fifteen BIDCOs were licensed over

the next few years, but by 2000, onlyseven were still in existence, five ofthem barely hanging on.

Today, there are just two, AAsssseettBBIIDDCCOO LLLLCC and OOnnsseett BBIIDDCCOO LLLLCC, bothrun in Lansing by Joseph Reid III,who is president of both.

“It was a great concept about cap-ital formation that had a lot of flawsin the implementation,” said ScottEisenberg, managing partner of in-vestment banking firm of AAmmhheerrssttPPaarrttnneerrss LLLLCC. in Birmingham.

Eisenberg was with arguably themost successful of the BIDCOs,Onset BIDCO, which was formed in1988 and sold in 1994 to the now-de-funct Lansing-based CCaappiittaall BBaannccoorrpp..

“Onset was the largest BIDCO atformation, with $10 million. Most ofthe others were $4 million or $5 mil-lion, and you can’t make money witha fund that size,” Eisenberg said.

“Onset’s portfolio was wildly suc-cessful. We invested in 22 companiesand had a return of 20 percent, but alot of the BIDCOs had portfolios onlya mother could love,” he said.

Another problem, Eisenberg said,is that while the surviving BIDCOs

are now limited liability corpora-tions, they were originally formed asC-Corps, which meant they general-ly paid higher tax rates than privateequity and venture capital firms.

Reid agreed with Eisenberg thatmost BIDCOs were fatally under-funded from the start.

“A lot of them had $2 million or $3million to lend, then they hired staffand opened offices and were upsidedown before they got going,” he said.

But “we’re a survivor. ... We’re prof-itable and we’re here to stay.”

Reid said his BIDCOs do between10 and 15 deals a year, for as small as$50,000 and as large as $2 million.They also do straight loans and equi-ty investments.

“A lot of our deals are short-termloans, bridge financing to help com-panies clean things up to the pointwhere they can get a bank loan,” hesaid.

Reid said that although asset-based lenders have formed since thebrief BIDCOs boom to help fill thesame funding gap, there is still aneed, particularly with banks’greater caution post-recession.

“Regulators have tied the banks’hands,” Reid said. “So many busi-nesses are struggling to get financingdespite good collateral. There’s such adramatic need for what we do, I’msurprised we’re the only BIDCOs left.”

Rochester-based HHeennnneesssseeyy CCaappii--ttaall LLLLCC, an asset-based lender, wasfounded in 2002 and bought in 2012by Connecticut-based HHiittaacchhii CCaappiittaallAAmmeerriiccaa CCoorrpp...

In 2013, MMaacckkiinnaacc FFiinnaanncciiaall CCoorrpp..,the holding company for mmBBaannkk, acommunity bank based in Manis-tique, formed a subsidiary in Birm-ingham, MMaacckkiinnaacc CCoommmmeerrcciiaall CCrreeddiittLLLLCC, to do asset-based lending.

The most active local asset-basedlender, Troy-based CCrreessttmmaarrkk BBaannkk,has a national focus. In the first ninemonths this year, it says, it loaned$61 million to 56 new clients in 16states and Canadian provinces.

David Provost is chairman andCEO of Troy-based TTaallmmeerr BBaannkk aannddTTrruusstt, the state’s fastest-growingbank, having bought the assets ofseveral troubled banks in Michiganand the Midwest as they were shutdown by regulators.

But he was not as successful witha foray into BIDCOs when he waspresident of the BBaannkk ooff BBlloooommffiieellddHHiillllss in 1991.

Provost said the bank invested$50,000 in Southfield-based LLiibbeerrttyyBBIIDDCCOO IInnvveessttmmeenntt CCoorrpp., in part tomake a return on investment, butmore so because it would introducehim to companies that presumablywould need a variety of traditionalbank services as they matured.

Liberty grew through buyingother BIDCOs, and by 1998 was highflying, showing up on a Crain’s list offastest-growing private companies.

But in 1999, nine of its 57 invest-ments went out of business, causingLiberty to write off almost a third ofits $35 million portfolio. By 2000, itwas in default on its bank loans, andby 2002, it was out of business.

“BIDCOs were going to do loansbanks couldn’t or wouldn’t do,”Provost said. That most BIDCOsfailed “shows you when banks can’tdo a deal, there’s probably a goodreason.”

He said the bank ended up writ-ing off its entire investment.

As for landing future customers,the bank didn’t do any of that, either.

“We didn’t get one,” said Provost.“Things didn’t work out to our ex-pectations.” �

Despite good intentions, BIDCOs failed to fill lending gapLOOKING BACK: Thirty years ago, Crain’s reported on state governmentapproval of BIDCOs, which would provide alternative funding for newbusinesses. Mostly, it didn’t work. More at crainsdetroit.com/30

Joseph Reid III:President of thetwo remaining BIDCOs in Michigan.


M ichigan is in contention for a major data center, andit’s a big deal — $5 billion in investment and 1,000high-quality jobs, according to the projections.

The project would be a 2 million-square-foot center, whichits owner, Las Vegas-based Switch, says would be the largestin the eastern U.S. It would be south of Grand Rapids in theformer Steelcase Corporate Development Center.

Standing between Michigan and the center, apparently,are tax incentives. Bills have been introduced in the Houseand Senate that would provide exemptions from certainsales, use and property taxes.

Are the exemptions worth it?It’s hard to tell. HBs 5074-76 and SBs 10-12 have only re-

cently been introduced, and there isn’t yet a fiscal analysis.Gov. Rick Snyder has not weighed in.

These types of centers have received a lot of attention andare often highly sought after. But they sometimes do not pro-duce as many jobs as expected, and local communities donot necessarily reap enough tax revenue to compensate forthe services provided because of the incentives. Communi-ties that don’t have the centers worry that an entire state issubsidizing a benefit for one community.

So, we believe the question should be this: How can every-one win?

The state needs good jobs and, as a Michigan Future reportnotes (See story, Page 10), the state particularly needs jobsthat are part of the information economy.

But local governments have been under stress since the re-cession, and state policies have helped contribute to that, ac-cording to a Michigan State University analysis reported byBridge Magazine.

Swift action may be called for, but it shouldn’t take placebefore strategic thought.

City pension funds on better pathAs Robert Snell reports on Page 1, Detroit’s two municipal

pension funds are in position to make investments again forthe first time since emerging from bankruptcy.

The funds’ portfolios have been assessed, more invest-ment oversight has been put in place and a strategy has beendeveloped to better protect the interests of city employees.

The funds had many problems, including underfunding,corruption and board members who were underqualified tomake investment decisions.

All of those meant the sole purpose of a pension fund —producing promised benefits for those it covers — was for-gotten.

So in the future, for example, real estate investments arelikely to be in REITs or other commingled investments,rather than individual projects like the Westin Book Cadillacor the Grand Traverse Resort, where the risks often outweighthe potential rewards.

It also means the cronyism that sometimes led to corrup-tion should be a thing of the past.

But memories can be short, so the more firmly a properstructure is set in place, the better.

State should weightax breaks structure

8

Editor:An Oct. 12 blog by Jay Greene

(“National C-section rate high, butBeaumont among Detroit-area hos-pitals that cite improvement”) statedthat Beaumont Hospital in RoyalOak is “bucking the national trend ofincreasing C-sections by cutting itsrate by one-third in only six months.”

For comparison, he offered thatBeaumont’s C-section rate of 14.6percent is down from 21 percent,and then referred to Leapfrog datain which he pointed out that only 28percent of Michigan’s hospitals re-port this data. Beaumont does notreport to Leapfrog.

The blog implies that Beau-mont’s C-section numbers are con-siderably lower than the Leapfrog-reporting hospitals. However,

Beaumont’s data on its C-sectionrate is using its Primary C-sectionrate, which is different than thecomparison hospitals use to reportto Leapfrog.

Leapfrog asks us to report ourNTSV C-section rate, which countsfirst-time pregnancies that havereached the 37th week or later markand consist of one fetus in the head-down position. The rate is derived

by the number of NTSV patientswho end up with C-sections dividedby total NTSV patients.

The Primary C-section rate isbased on the entire labor and deliv-ery population of a hospital. It is thenumber of C-sections divided bythe total number of all deliveries ex-pressed as a percentage.

The difference in methodologymeans the NTSV C-section rate willgenerally be higher than the Prima-ry C-section rate.

The NTSV C-section rate hasgained interest, and national re-search has been using this specificdefinition and patient population.The emphasis is on reducing theNTSV C-section rate because it

LETTERS

SSeenndd yyoouurr lleetttteerrss:: Crain’s DetroitBusiness will consider forpublication all signed letters to theeditor that do not defameindividuals or organizations. Lettersmay be edited for length and clarity.

Email: [email protected]



OPINION

Reported C-section rate data not comparable

Keep philanthropy from going wrongHow is it possible that Yale Uni-

versity decides to return a $20million gift to Texan billionaire LeeBass after a dispute regarding theuse of the gift? Or country singerGarth Brooks gives $500,000 to asmall Oklahoma hospital and laterwants his money back? Or morethan 40 years later the heirs of theA&P supermarket fortune suePrinceton University to return a $35million gift — now grown to $880million — because Princeton wasnot using the fund for its intendedpurpose?

The answer, in short, is bad plan-ning. Major gifts often come fromthe heart, a gift with the best inten-tions. And yet, these gifts are oftenmade with many expectations orassumptions that are not clearlyspelled out. A donor may not wantto appear ungracious, and the char-ity often will accede to any restric-tions just to get the gift, thinking“Someone else can figure out how

we will implement these require-ments later.”

Yet a major charitable gift is animportant business transaction.Donors and their advisers shouldgive some thought to how unex-pected outcomes would be han-dled. If a donor gives XYZ University$10 million for a chemistry buildingand it agrees to name the buildingafter the donor, what happens if thebuilding burns down two yearslater? If the university intends to re-build, does the new building get the

same name? Furthermore, donors tend to put

unrealistic or overly demanding re-strictions on major gifts. Donorsand their advisers should ask them-selves if any of these restrictionsharm or restrict the organization? Itis not uncommon for overly re-stricted gifts to cost a charity moreto implement than the face value ofthe gift.

As we approach the end of theyear, many families turn theirthoughts to charitable giving. If amajor gift is contemplated, consultyour professional adviser and re-member a few important guidelines:1) Be sure to assess the financialhealth and leadership stability of thenonprofit, 2) clearly state all expecta-tions in writing, 3) be wary of toomany restrictions and 4) if you dearlylove this organization, considermaking part of your gift for opera-tions and even endowment, as thiswill ensure its long-term viability. �

OTHER VOICES:Mark Neithercut

Neithercut is president of NeithercutPhilanthropy Advisors in Detroit.

SEE NEXT PAGE

20151123-NEWS--0008,0009-NAT-CCI-CD_-- 11/20/2015 4:37 PM Page 1

Some business owners expect more than just an account. They expect their bank to understand their business.

When it’s time, come to Comerica. And discover why we’re the leading bank for business,* ranked among the top 5% of U.S. banks with distinctive quality.**

I expec¶ my bank §o:Know my businessnot just my balance.

,

MEMBER FDIC. EQUAL OPPORTUNITY LENDER.

*Top 25 U.S. financial holding companies, based on commercial and industrial loans outstanding. Data provided by SNL Financial, December 2014. **Greenwich Associates is a leading provider of global market intelligence and advisory services to the financial services industry. For Middle Market, the Greenwich Excellence Awards are based on nearly 13,000 market research interviews with U.S. companies with sales revenues of $10-500 million, and honorees were recognized by their customers as providing superior quality of products, service and coverage. Among more than 750 banks evaluated, Comerica ranked within the top three percent of banks with “distinctive quality” and “performing at a differentiated level relative to peers.” For Small Business, the Greenwich Excellence Awards are based on more than 15,000 market research interviews with U.S. companies with annual revenues of $1-10 million, and honorees were recognized by their customers as providing superior quality of products, service and coverage. Among more than 750 banks evaluated, Comerica ranked within the top five percent of small business banks with “distinctive quality” and “performing at a differentiated level relative to peers.” CBP-5200-07 11/15

RAISE YOUR EXPECTATIONS.

Business Wealth Management Personal

®

comerica.com


Patient-centered medical homes in Michigan improve care, cut costs

Upper Peninsula Health Plan,among others.

As the PCMH model proliferates,

Michigan’s employers should bene-fit not only with lower health careexpenses, but also through employ-ees who are more productive due tofewer health problems and workabsences.

After fewer than five years imple-menting the new model, primarycare practices report improvementsin the biggest health care challengesfacing Michigan’s population —obesity, diabetes, hypertension andother issues that affect our agingresidents in large numbers and leadto chronic, costly hospital andemergency room visits.

Adult patients in PCMH-desig-

nated practices had a 26 percentlower rate of hospital admissionsfor common conditions that re-spond to office-based care.

Blue Cross-designated PCMHpractices also had an 8.7 percentlower rate of adult high-tech radiol-ogy use, and a 10.9 percent lowerrate of adult emergency room visits.PCMH-designated practices had a16.3 percent lower rate of pediatricemergency room visits and a22.4 percent lower rate of pediatricemergency room visits for commonchronic and acute conditions, suchas asthma.

Blue Cross estimates that over

the past six years, it has saved $512million through disease prevention,reduced hospitalizations and emer-gency room visits, and manage-ment of common acute and chron-ic medical conditions that haveimproved patient care outcomes.

When primary care providers en-gage patients in their care and areaccountable for its quality, the inci-dence of disease-specific mortalitydeclines. As Michigan residents ac-cess health care services, theyshould ask for and expect to be partof a patient-centered medical homepractice through a primary careprovider. �

Michigan employers whoshoulder health care expenses

for their workforce are optimisticthat a new patient care model ishelping to transform health care de-livery in Michigan.

Corporations and small-businessowners should continue to push forthe model’s implementation to helpbring down costs.

Michigan is one of eight statestesting a patient-centered medicalhome (PCMH) model through theCenters for Medicare and MedicaidServices in a multiyear, multipayerproject.

Physicians and practices thathave adopted the PCMH modeltake a “whole person” approachand coordinate care across allproviders and settings, helping con-sumers navigate the increasinglycomplex health care system. APCMH team may include anyhealth care provider relevant to thepatient’s health issues.

The results are beginning to showpositive health outcomes and costsavings. Supporters include majorjob providers and insurers includ-ing Blue Cross and Blue Shield ofMichigan, Health Alliance Plan and

OTHER VOICES:Jeffrey BrasieBrasie is executive director of the Michi-gan Primary Care Consortium, a non-profit working to transform Michigan’sprimary care delivery system.

FROM PREVIOUS PAGE

eliminates some of the higher-riskscenarios such as twins or breechbirth. These patients often are athigher risk of C-section.

The NTSV C-section rate as re-ported in the article averages ap-proximately 27 percent in those re-porting in Michigan with a targetgoal of less than 23.9 percent by2020.

At St. Joseph Mercy Ann Arborand St. Joseph Mercy Oakland,Leapfrog-reported NTSV rates are26.4 percent and 30.5 percent, re-spectively.

St. Joseph Mercy Ann Arbor andOakland have also been working ondecreasing C-section rates. In AnnArbor, our NTSV has remainedsteady, but our Primary C-sectionrate has decreased with a similarfocus as Beaumont’s — our most re-cent Primary rate, in September2015, was 13.2 percent; in 2015, theaverage has been 17.3 percent.

At St. Joseph Mercy Oakland, ourPrimary C-section rate (CY 2015thru June) is 15 percent (down from18.5 percent in 2014). Our Leapfrog-reported NTSV rate was 30.5 per-cent for 2014. Year to date throughJune 2015, we reduced the NTSV to25 percent.

While we applaud all our col-leagues in their efforts to providesafe, cost-effective and responsiblecare, we would like to point out thatyou are not comparing “apples toapples” when applying Beaumont’sPrimary C-section metrics to thoseof Leapfrog-reporting hospitals.

Gayle Moyer, M.D.Director of obstetric patient safetySt. Joseph Mercy Ann ArborFabian Fregoli, M.D.Vice president, quality and patient safetySt. Joseph Mercy Oakland

20151123-NEWS--0008,0009-NAT-CCI-CD_-- 11/20/2015 10:51 AM Page 2


OneTeamYourFuture

CPAs

Consultants

Corporate

Investigators

Providing valuable solutionsWe’re ready to deliver

Rehmann’s dedicated professionals devote their knowledge and industry experience to customizing the ideal approach for your financial institution.

We can help you thrive in the marketplace with audit, tax, regulatory compliance, IT and consulting services. Contact us today to learn how our team can help your institution thrive.

Detroit, Ann Arbor, Farmington Hills, Troy

rehmann.com | 866.799.9580

Liz Ziesmer, CPA, CBAPrincipalDirector of Financial [email protected] | 616.975.4100

Survey: State held down by per capita income, educationBy Lindsay VanHulle

Crain’s Detroit Business/Bridge Magazine

LANSING — Michigan is strug-gling to achieve economic prosperi-ty during a boom time for the autoindustry, with low per-capita in-come and fewer than a third of itsresidents holding bachelor’s de-grees, new research to be releasedtoday shows.

The state that gave birth to carsnow ranks in the bottom half na-tionally on those two measures, ac-cording to the study conducted byUUnniivveerrssiittyy ooff MMiicchhiiggaann economistDon Grimes and Lou Glazer, presi-dent of Ann Arbor-based think tankMMiicchhiiggaann FFuuttuurree IInncc.

The researchers’ findings revealthat Michigan shed workers andwages by 2 percent since 2007, thestart of the last economic down-turn, despite growth of roughly 1percent nationally in both areas.Detroit was hit harder, because thecity disproportionately was affectedby the auto industry’s woes.

What the trends mean for Michi-gan, Glazer said, is that the state nolonger can rely on high-paying, low-skilled manufacturing jobs — thejobs that built its middle class start-ing with Henry Ford’s promise of a$5 daily wage a century ago — if itwants to prosper.

Rather, he said, Michigan needsto put more of its residents to work,concentrate more people with four-year degrees in its cities and speed

up the transition to a knowledge-based service economy — all traitsof more-prosperous states.

“This is some-thing that basi-cally has neverhappened inMichigan,” saidGlazer, whoseMichigan Futurethink tank stud-ies talent and thetransition to aninformationeconomy. “What

we’re basically saying is, the formulathat worked for Michigan in the20th century … does not work inthe 21st century.”

That shift has been going on forseveral years, partly because theauto industry had inflated Michi-gan’s per-capita income relative tothe rest of the country even thoughthe state had a lower percentage ofcollege graduates.

When the auto sector collapsedduring the recession, it took incomelevels with it. In 2000, Michigan hadthe 18th-best per-capita income inthe U.S.; in 2013, the state had fallento 37th, according to state data andthe Michigan Future report. Thatsame year, Michigan ranked 33rdfor the share of adults with a bache-lor’s degree.

Glazer and Grimes analyzed eco-nomic and education data from2007 to 2014 and compared Michi-

gan to both national averages andother states. They did a similaranalysis for the metropolitan re-gions in Detroit and Grand Rapids,comparing both regions to otherU.S. metros with at least 1 millionpeople.

They found the only sector na-tionally to add jobs and raise wageswas high-education services, whichincludes finance, health care andsocial services.

Other sectors they studied in-clude low-education services,which includes lower-paying jobs insuch fields as retail and tourism;low-education goods, often low-skilled manufacturing jobs; andhigh-education goods, a sector thathas the fewest employees and in-cludes oil and gas extraction andaerospace, chemical and computermanufacturing.

The only way a state today canland on top 10 lists for employment,wages or income is either to have awealth of energy resources, likeAlaska and North Dakota, or have ahigh concentration of adults withbachelor’s degrees, Glazer said.

The trends don’t necessarilyindicate causation, merely corre-lation. But places that performwell by those measures place lessof an emphasis on makingthings, Glazer said.

The idea that Michigan shouldaim to be a top 10 economy statehas other researchers’ attention.

BBuussiinneessss LLeeaaddeerrss ffoorr MMiicchhiiggaann, thestate’s business roundtable, re-leased a study this month showingthat Michigan continues to lan-guish in the bottom half of states

when it comes to income metrics.In 2014, Michigan ranked 34th in

per-capita GDP and 36th in per-capita personal income and had thefifth-worst unemployment rate inthe nation, ranking 46th, accordingto BLM’s study.

But signs of optimism are emerg-ing: The state’s per-capita personalincome growth rate ranked 10th,while its per-capita GDP growthrate was third-fastest in the country,according to the study.

Grimes and Glazer found:� Detroit is doing better in high-

education service fields than placeslike Milwaukee and Pittsburgh, for-mer manufacturing-heavy citiesnow transitioning to knowledgeeconomies.

That could be because metro De-troit has a greater concentration ofknowledge jobs in the auto industry,from engineering to design, Glazersaid. Metro Detroit had an averagewage of $68,222 in high-educationservices in 2014, compared with$62,480 in Milwaukee and $65,988in Pittsburgh.

� Wages are low in Grand Rapids.The region had an overall averagewage of $43,801 in 2014, comparedto $54,168 in Detroit, $56,337 inMinneapolis and $69,427 in Boston.The Grand Rapids area ranked 49thof 52 U.S. metropolitan areas with apopulation of at least 1 million, andlast when factoring for knowledge-based jobs’ share of total wages,data show.

The good news: Michigan isadding jobs at a faster rate than thenation, and the state has better col-lege attainment rates amongyounger people — ages 25-34 —than across the population as awhole. Yet, Glazer said, “no ques-tion, it’s still low.” �

Lindsay VanHulle: (517) 657-2204Twitter: @LindsayVanHulle

LISA SAWYER

Lou Glazer: Theold formula doesn’twork anymore.

20151123-NEWS--0010-NAT-CCI-CD_-- 11/20/2015 11:40 AM Page 1


Generating interestLocal bank executives see potential December rate hike by the Fed as long overdue


Bank stocks jumped on Nov. 6, im-mediately after the UU..SS.. BBuurreeaauu ooffLLaabboorr SSttaattiissttiiccss announced that the

economy added 271,000 jobs in October,much better than economists had beenprojecting.

The feeling on Wall Street was that sucha good jobs number meant the FFeeddeerraall RRee--sseerrvvee was more likely than not to start rais-ing record-low interest rates in Decemberinstead of waiting until next year, and ris-ing interest rates in turn would be good,naturally, for institutions that charge inter-est.

The share prices of 13 state, regionaland national banks with branches in

Michigan that trade publicly were all upthat Friday morning. Dallas-based CCoommeerrii--ccaa BBaannccoorrpp IInncc.., for example, was up $2.01to $47.44; New York City-based JJ..PP.. MMoorrggaannCChhaassee && CCoo.. rose $2.59 to $69.03; Pitts-burgh-based PPNNCC FFiinnaanncciiaall SSeerrvviicceess IInncc..rose $3.44 to $96.08; Rhode Island-basedCCiittiizzeennss FFiinnaanncciiaall GGrroouupp IInncc.. was up $1.36 to$25.97; Troy-based FFllaaggssttaarr BBaannccoorrpp IInncc..was up 60 cents to $23.40; and Troy-basedTTaallmmeerr BBaannccoorrpp IInncc.. was up 58 cents to$18.13.

“There’s an old expression. You’d ratherhave a quick ‘no’ than a slow ‘maybe,’ andbankers are glad the slow ‘maybe’ is aboutover,” said John Donnelly, managing direc-tor of Grosse Pointe-based DDoonnnneellllyy PPeenn--mmaann && PPaarrttnneerrss, an investment bank that

focuses on financial institutions.The “slow ‘maybe’ ” referred to the many

months of hints and teases by the Fed thatit was about to raise rates. An increaseseemed likely in September until the largeswings in financial markets in August.

The Fed sets what is called the federalfunds, or overnight, rate at which banksborrow. It has averaged 5.93 percent since1971, with the all-time high of 20 percentset in March 1980. In December 2008, inhopes of keeping the Great Recessionfrom becoming a depression, the Fed setwhat it calls its target range at the all-timelow of zero to 0.25 percent, and it has re-mained there ever since.

SEE RRAATTEE, PAGE 12

“Even if we got just three-eighths of a percentage point, that would mean $1 million a year to our bottom line.” David Provost, chairman and CEO, Talmer Bank and Trust

Sorting out thefallout of lowinterest ratesT

he federal funds interest rate atwhich banks borrow, known asthe overnight rate, is set by the

FFeeddeerraall RReesseerrvvee. It has averaged 5.93 per-cent since 1971, with the all-time highof 20 percent set in March 1980. In De-cember 2008, during the Great Reces-sion, it hit the all-time low of 0.25 per-cent and has remained there.

Regulators say low rates were crucial tostaving off a depression. Free-market ad-vocates say the Fed did too much for fartoo long with unintended consequences.

One of those critics is Jim Grant, thefounder and editor of Grant’s Interest RateObserver, a twice-monthly newsletter forfinancial insiders at a pricey $1,175 annu-ally. He was one of the guest speakersNov. 12 at the annual economic outlooklunch put on by the CCFFAA SSoocciieettyy ooff DDeettrrooiittat the WWeessttiinn HHootteell in Southfield.

He told the chartered financial ana-lysts in the crowd, not to their surprise,that record-low interest rates had both in-tended and unintended consequences.

An intended consequence? Pullingconsumption forward, with low ratesbeing just fine for auto sales, for exam-ple, which as of September were hum-ming along for U.S. manufacturers at anannual rate of 18.2 million units.

And an unintended consequence?“Pushing failure back in time,” he said.“Companies that ought to leave this lifeand make room for other entrepreneurscontinue to muddle along.”

RRaaddiioo SShhaacckk, which filed for Chapter11 bankruptcy protection in February, isthe prime example, he said. Record-lowrates and borrowed cash kept it on lifesupport. “It was an unwarranted exten-sion of a sick business,” he said.

Jason Trennert, chairman and CEO ofNew York City-based SSttrraatteeggaass RReesseeaarrcchhPPaarrttnneerrss, was the other keynote speaker.Also critical of the Fed , he nonethelessgave a relatively rosy forecast.

With a recession unlikely, he said, abear market for equities is also unlikely.Although stock markets have had a longrun-up, “the real bubble isn’t in publiclytraded companies, it’s in the private-eq-uity industry,” he said.

Private equity firms had $700 billionin assets in 2000; today, they have $3.5trillion, Trennert said. And investorsshould be leery of hedge funds, whichhave grown from about $30 billion in2008 to about $130 billion now. Despitetheir reputations, hedge funds havebeen getting beaten by traditionalmoney managers.

“It’s the cult of activist hedge funds,”he said. “They used to be called raiders.Now they’re called activists, which isgreat PR.” �

TOM HENDERSON [email protected]: @tomhenderson2

SPECIAL REPORT:

FINANCE

Traders in the S&P 500 stock index futures pit at the ChicagoBoard of Trade react to news in October 2008 that the Federal Reserve would cut the interest rate. Expected soon isnews that the Fed will finally increase the rate.PHOTO BY SCOTT OLSON

Huron Valley State Bankplans to grow, Page 14

All state banks inMichigan see stars innew ratings report,Page 14

INSIDE


21420 Greater Mack Avenue | St. Clair Shores, MI 48080

Achieving success requires a team that stands out. The professionals at GHD have years of experience helping our clients obtain success through innovative and customized services. Let our team help you reach your goals. Contact us today!

EXPERIENCE THE DIFFERENCE EXPERIENCE GHD CPAS AND ADVISORS

www.ghdcpa.com | 586-772-8100

Accounting and Assurance ServicesTax Planning and Preparation


CONGRATULATIONS TO THE 2015 ACCELERATEMICHIGAN INNOVATION COMPETITION WINNERS!

With more than 300 Michigan companies vying for funding in 2015, 14 companiescaptured cash prizes. Top award winners were:

GRAND PRIZE: $500,000 BY SECTOR: $25,000

RUNNER UP: $100,000

NEXT GENERATIONMANUFACTURING

LIFE SCIENCE MEDICAL DEVICES

ADVANCEDMATERIALS

INFORMATIONTECHNOLOGY

PRODUCTS ANDSERVICES

ALTERNATIVEENERGY

ADVANCEDTRANSPORTATION

PEOPLE’S CHOICE($10,000 PRIZE)

www.acceleratemichigan.org

SPONSORS

BLOOMFIELD TOWNSHIP • CLARKSTON • DEARBORN • DETROIT RIVERFRONT

GROSSE POINTE WOODS • LIVONIA • ROYAL OAK • STERLING HEIGHTS • WARREN

andiamoitalia.com

Andiamo is the perfect place to celebrate an extraordinary event on any budget.

• Accommodations for groups of 10-700• Experienced staff to assist with private or corporate events • Off-site catering services also available

Why Have an Ordinary Holiday Eventwhen you can have an

Andiamo Event

Every Meal is a Celebration

SPECIAL REPORT: FINANCE

If a quick “no” is better than aslow “maybe,” then a “yes,” is much,much better than a “no,” said Don-nelly. And the Fed seems poised tosay “yes” to higher rates.

Donnelly said being able to gen-erate more interest-based incomewill be more important to commu-nity banks than large national andregional banks. He said larger banksgenerate about half their incomefrom fee-based sources, such asmortgage operations, treasurymanagement for businesses, andtrust and wealth management forthe wealthy.

Cash returns, littleinterest

Community banks don’t oftenhave the resources to offer a full lineof fee-based services. “Their per-centage of fee-based income mighttypically be only 10 or 20 percent,”Donnelly said.

“Clearly this is going to be a bighelp, particularly for communitybanks, who are rate sensitive,” saidJ. Grant Smith, president and CEOof CCllaarrkkssttoonn SSttaattee BBaannkk.

Many community banks haveadded to their noninterest incomeside of the ledger as interest ratescontinued to stay at or near zero,and Clarkston State Bank was oneof them.

Smith said his bank has beenable to generate income in recentyears through offering treasurymanagement to business owners.He said the bank decided not to getinto the mortgage business but isconsidering offering wealth man-agement services.

“It appears the Fed is going toraise interest rates in December, andthat’s particularly good for commu-nity banks. We should become moreprofitable in a rising interest rate en-vironment,” said Jack Shubitowski,president and CEO of Milford-basedHHuurroonn VVaalllleeyy SSttaattee BBaannkk.

“We started doing residentialmortgages two years ago, and it’sbeen very successful generating

revenue for us,” he said.Large regional banks, already ac-

customed to getting a high percent-age of revenue from the noninterestside of the business, focused evenmore on that business, said DaveGirodat, president and CEO of theeastern Michigan market forCincinnati-based FFiifftthh TThhiirrdd BBaannkk.

“We’ve really focused on ourcommercial customers and value-added advisory services,” he said,including wealth and investmentmanagement, treasury manage-ment and currency managementfor cash business like grocery storesand gas stations.

Even so, Girodat said he is look-ing forward to getting back to wherebankers can make more profit theold-fashioned way, through charg-ing higher interest. “A normalizedrate environment is a positivething,” he said.

Buyers in a turbulent time“A rate increase is overdue,” said

Patrick Fehring, president and CEOof Farmington Hills-based LLeevveell OOnneeBBaannkk. “That interest rate was putinto effect during emergency times,and obviously the economy hascome a long way since. … Any timethere is excessive interference bythe government, it gets in the way.”

Level One was launched in Octo-ber 2007, just in time for the GreatRecession. The timing was good forFehring, because when the reces-sion hit, his bank, unlike establishedbanks, didn’t have much exposure tobad loans. Over the years, he wasable to buy the assets of several trou-bled banks as they were closed bystate and federal regulators.

More recently, Level One hasbought healthy area banks. In Octo-ber, it announced it was buyingFarmington Hills-based BBaannkk ooffMMiicchhiiggaann, whose $110 million in as-sets will give Fehring’s bank morethan $1 billion in assets when thedeal closes in the first quarter.

“For us, if there was a silver liningto low interest rates, it created asense of urgency to create a growthstrategy,” he said. “In a low-interest

RATEFROM PAGE 11

SEE NEXT PAGE



3 497 7 wo odwar d av enue b ir ming h am, mi 48 009 greenleaftrust.com 248 . 5 3 0 . 6 200

Three generations and counting—on you.At a certain level of wealth, one’s wants, needs and desires invariably change.

The merits of a family foundation, for example, become clearer. Philanthropy, and the values it imparts to younger generations, takes on greater meaning.

And the long-term balance between family wealth and family unity becomes ever more important. These and other issues relevant to generational wealth

are best served by an advisor with long-term stability, unimpeachable integrity and proven competence. In short, the Family and Foundation Services

Division of Greenleaf Trust. We listen, guide and serve your family from today’s generation to the next in a manner that is remarkable for its

attentive, discrete and wholly reliable service. Greenleaf Trust knows family matters—in every meaning of the phrase.

Call us to learn more.


FROM PREVIOUS PAGE

environment, it’s hard to be prof-itable unless you get bigger faster.Instead of getting a traditionalspread on interest, to get the samedollar volume, you have to do morevolume.”

His growth strategy meantlaunching a commercial lendingbusiness, which now employsabout 17 bankers, and a residentialmortgage department, which nowemploys about 25 bankers.

“Those were pretty big invest-ments for a community bank at theend of a recession,” he said. Butthey paid off.

Like Level One, TTaallmmeerr BBaannkk aannddTTrruusstt, which was also launched in2007, has thrived despite an un-precedented stretch of record lowinterest rates. Like Level One,Talmer, which now has about $6.4billion in assets, grew by acquiringthe assets of a string of failed banks,starting with CCiittiizzeennss FFiirrsstt BBaannkk inPort Huron in 2010.

David Provost, chairman andCEO of Talmer Bank and Trust, saidhis bank is required to have $300million set aside as reserves againstfuture losses.

“We earn nothing on that now,”he said. “Even if we got just three-eighths of a percentage point, thatwould mean $1 million a year to ourbottom line.”

Provost has been a banker since1976. “I remember in 1980, we werecharging 20 percent for a car loanand paying 15 percent on a CD,” hesaid.

Home loan at 18.5 percent?“I bought my first home 25 years

ago, and I was paying 10 percent,which was a great loan then,” saidJim Ciroli, CFO of Troy-basedFFllaaggssttaarr BBaannkk. He said higher interestrates will help the bank generatemore income, and happier cus-tomers, too.

“It wouldn’t be bad to be in anenvironment where we weren’tbeing vilified for offering low inter-est rates. And we are being vilified,”he said. Flagstar’s brightly lit LEDbillboards around town trumpetinterest rates that he says are gen-erally better than the competi-tion’s, but often get criticized by thepublic.

Last week, for example, Flagstar’swebsite was offering an interest rateof 1.05 percent on savings accounts.It was also offering rates of 3.319percent on locked-in mortgagesand as low as 2.99 percent on homeequity loans.

Ric DeVore, the president of theMichigan market for Pittsburgh-based PPNNCC, also remembers muchhigher rates early in his career.

“My first house was in Allen Parkin 1981, and our interest rate was 18and a half percent, and that was adeal,” he said. “I got a discount be-cause I worked for the bank. Mybrother later got a loan at just below10 percent and I remember saying,‘I thought we’d never see loans thatlow again.’ ”

DeVore said he expects the Fedto raise interest rates by a quarterpercentage point in December and

in each of the following four quar-ters.

That will allow PNC to begin gen-erating more interest revenue onnew loans, but he said it will alsolower the hit on existing loans, suchas home-equity loans, as they reset. For years now, “every ratethat renews renews at a lower

rate,” he said.And that, said DeVore, comes at a

time when banks have had to spendmore money on nonrevenue-pro-ducing items, such as more vigilantcybersecurity and the higher cost ofcompliance after the Dodd-FrankAct tightened regulations.

DeVore said the long-term

squeeze on interest income has re-inforced a motto for him with hisfellow bankers at PNC.

“A dollar is not a dollar,” he said.“A dollar of interest income is worthless than a dollar in fee income, be-cause you have to reserve moneyagainst those accounts.”

Despite a rise in interest rates,and interest income, his bankerswill continue to focus, and receivebetter bonuses, based on lines ofbusiness with recurring fees, such401(k)s and treasury and cash man-agement for business owners.

The BBaannkk ooff AAnnnn AArrbboorr has addedto its fee-based income by gettinginto mortgage lending and addingtrust services and wealth manage-

ment. And in 2013, it bought AnnArbor-based EErrvviinn LLeeaassiinngg CCoo.., a na-tional equipment leasing and fi-nance company founded in 1978.

“We’ve had an increased empha-sis on fee-based income,” said TimMarshall, the bank’s president andCEO.

He said that the Fed starting toraise interest rates won’t be a bigdeal right away from a monetarypoint of view, because it will only bea quarter of a percent, “but from apsychological standpoint? It will bebig, especially if we can get short-term and long-term rates moving intandem.” �

Tom Henderson: (313) 446-0337Twitter: @TomHenderson2

“It wouldn’t be bad to be inan environment where weweren’t being vilified foroffering low interest rates.And we are being vilified.”Jim Ciroli, CFO, Flagstar Bank


14

AU

GU

ST

25TH

JAN

UA

RY

201

5

NO

VE

MB

ER

201

5D O W J O N E S I N D U S T R I A L A V E R A G E

2 4 8 . 7 3 1 . 9 5 0 0 | W W W . S C H E C H T E R W E A LT H . C O M

When markets dropped, did your advisor harvest losses? The market recently dropped 12% from peak to trough in August.

Did your investment advisor harvest tax losses before the rebound in October?

If not, you missed out. Did your advisor rebalance your portfolio?

If not, you missed out. These are just two of the reasons why so many

smart investors are moving their portfolios to Schechter Wealth.

Come learn how our process and technology deliver results.


All banks with HQ in Michigan seeing starsState banks hit the bottom in March 2010, ac-

cording to the quarterly ratings from Fort Laud-erdale, Fla.-based BBaauueerrFFiinnaanncciiaall IInncc..

The company tracks the health of banks andcredit unions, rating them from zero to five stars.

That March, 15 banks, many of them in South-east Michigan, got zero stars. Twenty-three,many of them in the Upper Peninsula, whoseisolation helped them avoid some of the mort-gage frenzy that led to the Great Recession, hadthe top rating of five stars.

Today, there are no banks headquartered inMichigan with a zero-star rating. One bank withbranches here, GGuuaarraannttyy BBaannkk of Glendale, Wis.,did get zero stars.

The much improved economic climate now ispartially responsible for the improved ratings.But the main reason for the lack of zero-starbanks is that most of them were put out of theirmisery by state and federal regulators, includingCCoommmmuunniittyy CCeennttrraall BBaannkk of Mt. Clemens, the BBaannkkooff DDeeaarrbboorrnn, PPeeoopplleess SSttaattee BBaannkk of MadisonHeights and PPaarraammoouunntt BBaannkk of Farmington Hills.

Today, there are 52 state banks with five-starratings. There are 13 top-rated banks in South-east Michigan. They are:

� AAnnnn AArrbboorr SSttaattee BBaannkk� BBaannkk ooff MMiicchhiiggaann, Farmington Hills, is being

bought by Farmington Hills-based LLeevveell OOnnee BBaannkk� Troy-based CCrreessttmmaarrkk BBaannkk� DDeeaarrbboorrnn FFeeddeerraall SSaavviinnggss BBaannkk� Detroit-based FFiirrsstt IInnddeeppeennddeennccee BBaannkk� FFiirrsstt SSttaattee BBaannkk of St. Clair Shores� HHaannttzz BBaannkk of Southfield� Milford-based HHuurroonn VVaalllleeyy SSttaattee BBaannkk� LLeevveell OOnnee BBaannkk, Farmington Hills

� Bingham Farms-based MMaaiinn SSttrreeeett BBaannkk� Southfield-based SStteerrlliinngg BBaannkk aanndd TTrruusstt� Troy-based TTaallmmeerr BBaannkk� Ann Arbor-based UUnniivveerrssiittyy BBaannkk.

Regional and national banks operating herethat got five stars include:

� Dallas-based CCoommeerriiccaa BBaannkk� New Orleans-based CCrreesscceenntt BBaannkk && TTrruusstt� Cincinnati-based FFiifftthh TThhiirrdd BBaannkk� Akron, Ohio-based FFiirrssttMMeerriitt BBaannkk� Cleveland-based KKeeyyBBaannkk; � Chicago-based PPrriivvaatteeBBaannkk && TTrruusstt

Of the 262 credit unions in Michigan, 140 gotfive stars. Only two got zero stars — LLaattvviiaann HHeerr--iittaaggee FFeeddeerraall CCrreeddiitt UUnniioonn of Grand Rapids andSShhoorreelliinnee FFeeddeerraall CCrreeddiitt UUnniioonn of Norton Shores.

Thirty-nine of them are in metro Detroit:� AAffffiinniittyy GGrroouupp CCrreeddiitt UUnniioonn of Pontiac� AAlllliiaannccee CCaatthhoolliicc CCrreeddiitt UUnniioonn of Southfield� CCeennttrraall MMaaccoommbb CCoommmmuunniittyy CCrreeddiitt UUnniioonn of

Mt. Clemens� CChhiieeff FFiinnaanncciiaall FFeeddeerraall CCrreeddiitt UUnniioonn of

Rochester Hills� CChhiirroopprraaccttiicc FFeeddeerraall CCrreeddiitt UUnniioonn of Farming-

ton� CCoommmmuunniittyy CChhooiiccee CCrreeddiitt UUnniioonn of Farmington

Hills� CCoommmmuunniittyy FFiinnaanncciiaall CCrreeddiitt UUnniioonn of Plymouth� CCoonnssttrruuccttiioonn FFeeddeerraall CCrreeddiitt UUnniioonn of Bingham

Farms� CCoorrnneerrssttoonnee CCoommmmuunniittyy FFiinnaanncciiaall CCrreeddiitt UUnniioonn

of Auburn Hills� CCrreeddiitt UUnniioonn AAddvvaannttaaggee of Southfield� CCrreeddiitt UUnniioonn OOnnee of Ferndale

� DDFFCCUU FFiinnaanncciiaall CCrreeddiitt UUnniioonn of Dearborn� DDiivveerrssiiffiieedd MMeemmbbeerrss CCrreeddiitt UUnniioonn of Detroit� DDoowwnnrriivveerr CCoommmmuunniittyy FFeeddeerraall CCrreeddiitt UUnniioonn of

Ecorse� EElleeccttrriiccaall WWoorrkkeerrss LLooccaall 5588 CCrreeddiitt UUnniioonn of Detroit� FFMMEE FFeeddeerraall CCrreeddiitt UUnniioonn of Roseville� GGeenniissyyss CCrreeddiitt UUnniioonn of Auburn Hills� IInntteerrnnaattiioonnaall UUAAWW FFeeddeerraall CCrreeddiitt UUnniioonn of Detroit� LLiinnccoollnn PPaarrkk CCoommmmuunniittyy CCrreeddiitt UUnniioonn� MMeemmbbeerrffooccuuss CCoommmmuunniittyy CCrreeddiitt UUnniioonn of

Dearborn� MMiicchhiiggaann EEdduuccaattiioonnaall CCrreeddiitt UUnniioonn of Plymouth� MMiicchhiiggaann FFiirrsstt CCrreeddiitt UUnniioonn of Lathrup Village� MMiicchhiiggaann SScchhoooollss aanndd GGoovveerrnnmmeenntt CCrreeddiitt UUnniioonn

of Clinton Township� MMoottoorr CCiittyy CCoo--oopp CCrreeddiitt UUnniioonn of Clinton

Township� PPaarrddaa FFeeddeerraall CCrreeddiitt UUnniioonn of Rochester� PPaarrkkssiiddee CCrreeddiitt UUnniioonn of Livonia� EEmmppllooyyeeeess FFeeddeerraall CCrreeddiitt UUnniioonn of Southfield� SStteerrlliinngg HHeeiigghhttss CCoommmmuunniittyy FFeeddeerraall CCrreeddiitt

UUnniioonn� TT&&II CCrreeddiitt UUnniioonn of Clawson� TTaannddeemm FFeeddeerraall CCrreeddiitt UUnniioonn of Warren� TTeeaammsstteerrss CCrreeddiitt UUnniioonn of Detroit� TThhee LLooccaall CCrreeddiitt UUnniioonn of Sterling Heights� UUnniittyy CCrreeddiitt UUnniioonn of Warren� VViibbee CCrreeddiitt UUnniioonn of Novi� VViillllaaggee CCoommmmuunniittyy CCrreeddiitt UUnniioonn of Dearborn� WWaalllleedd LLaakkee SScchhoooollss EEmmppllooyyeeeess FFeeddeerraall CCrreeddiitt

UUnniioonn of Wolverine Lake� WWaayynnee--WWeessttllaanndd FFeeddeerraall CCrreeddiitt UUnniioonn of Westland� WWeessttaaccrreess CCrreeddiitt UUnniioonn of West Bloomfield

Township� ZZeeaall CCrreeddiitt UUnniioonn of Livonia. �

Tom Henderson

Milford bankseeks $5Mand growth


Milford-based HHuurroonn VVaalllleeyy SSttaatteeBBaannkk, a small two-branch commu-nity bank that has consistently beenprofitable in recent years, earning astring of five-star ratings from FortLauderdale, Fla.-based bank ratingsfirm BBaauueerrFFiinnaanncciiaall IInncc.., is planningto grow the business.

To do so, it has formed a holdingcompany, the HHuurroonn VVaalllleeyy BBaannccoorrppIInncc.., through which it plans to raiseup to $5 million through a sale ofstock, debt or a combination ofboth, said President and CEO JackShubitowski.

“We’ve been talking to investmentbankers and they tell us that’s a smallraise. We say it’s just the right size, it’sall we need,” he said. “We were oneof the few banks in the state that did-n’t have a holding company, andhaving one gives us greater flexibilityto raise capital and borrow. Ourgrowth is organic and we need to beable to fund it adequately.”

He said loan growth is up 14 per-cent year-to-date.

Shubitowski plans to decide bythe end of the year how to raise themoney. He said it will be used tofund high demand for loans andpossibly to buy branches at a dis-count from larger banks.

“With larger banks closingbranches, it provides an opportuni-ty for us,” he said.

Shubitowski said another advan-tage of raising money through aholding company is even if it is bor-rowed money, once it is funneled tothe bank it goes on the bank’s bookas capital, increasing its tier-oneratio of capital to assets.

The bank had what Shubitowskidescribed as a strong third quarter.Net income was $278,000, or 33 centsa share, up from $210,000 or 26 centsa share, in the third quarter last year.

After-tax return on average equi-ty, a measure of profitability, was9.64 percent for the quarter, upfrom 7.91 percent in the same quar-ter last year.

Total assets were $112.6 million,up 15 percent in a year; total loanswere $98.3 million, up 17 percent;and deposits were $98.8 million, up15 percent.

Net income for the first ninemonths was $781,000, an increaseof 61 percent over the first ninemonths last year.

Huron Valley was founded in2005 by CCllaarrkkssttoonn FFiinnaanncciiaall CCoorrpp..,which sold its 55 percent stake in thebank in 2008 as the Great Recessionhit.

Unencumbered by bad legacydebt on its books, Huron Valleycame through the recession rela-tively unscathed. �





www.youngbasile.com

ANN ARBOR TROY SILICON VALLEY CHICAGO

YOUNG BASILE.Strategic advisors to the world’smost innovative companies.

Intellectual Property | Litigation | Technology

– BRAD KANCIGOR, ASSOCIATE GC

Synopsys, Inc

– BRAD KANCIGOR, ASSOCIATE GC

Synopsys, Inc

Transactional experience on par with the major Silicon Valley law firms.

State-of-the-art technology.Local banking know-how. Your hometown advantage.

COMMERCIAL LENDING | TREASURY MANAGEMENT | BUSINESS SERVICES

Banking local means our experts are always by your side. Whether providing local insight to market conditions or guiding you with state-of-the-art products designed to optimize cash flow and finance growth, you can count on us for world-class banking. Since 1917, we’ve been anchored right here in our community helping businesses move forward with decisions that come out of our office – and not out of state. It’s banking big…even when you’re banking local.

Give us a call today.www.thefsb.com/business | 866-372-1275

Survey: 94% of life science companies plan ’16 acquisitionBy Tom Henderson

[email protected]

Executives at life science compa-nies around the world think it’s agood time to go shopping.

Fully 94 percent of life sciencecompanies are planning to do anacquisition next year, according to aglobal survey of 100 senior execu-tives.

Seventy percent of those plan-ning acquisitions say they will focuson the hot sector of personalizedmedicine, where treatments andproducts are tailored specifically forindividuals, often based on their ge-netic information.

Companies said personalizedmedicine offers higher returns eventhough the patient population ismuch smaller.

“The future of medicine is to havethe rightmedicinefor theright pa-tient andthe rightdose at theright time,”said CarolLoepere, apartner inPittsburgh-based lawfirm RReeeedd

SSmmiitthh LLLLPP, which conducted thesurvey on behalf of the London-based MMeerrggeerrmmaarrkkeett GGrroouupp.

According to the survey, the firstsix months of 2015 saw about $164.3billion in M&A activity in life sci-ences, an increase of almost 53 per-cent over the same period a year ago.

Most of that involved U.S. com-panies, with 82 deals worth morethan $112 billion.

Ninety-one percent of U.S. re-spondents say they expect theirM&A to be cross border.

Deal flow continued strongly inthe second half of the year, includ-ing the $40.5 billion purchase of thegenerics division of Dublin-basedAAlllleerrggeenn ppllcc by TTeevvaa PPhhaarrmmaacceeuuttiiccaall ofIsrael.

Deal flow did get sidetrackedbriefly on Nov. 13 when Dutch drug-maker MMyyllaann NNVV said it had lost itsseven-month, $26 billion takeoverbid for PPeerrrriiggoo CCoo.. ppllcc, the Allegan drugcompany formally headquartered inDublin for tax purposes.

Mylan had to get more than 50percent of Perrigo’s shareholders toapprove the offer by the 8 a.m.deadline on Nov. 13, but securedonly 40 percent.

But analysts said Perrigo re-mained a takeover target of compa-nies envious of its tax rates in Ireland.

“Businesses are getting morestrategic about where they want tofocus,” said Diane Frenier, a partnerat Reed Smith. “They have moneyon the balance sheet that they wantto put to use for shareholders, andthey’re looking for ways to addvalue.”

“The M&A boom in the life sci-ences sector looks set to continue.

Deal volumes are on track to beat2014, itself the busiest year for trans-actions since the financial crisisseven years ago,” said Nick Cheek,global managing editor of Remark,the events and publications divisionof the Mergermarket Group.

“Despite considerable uncertain-ty, transactions will continue apace,

as life sciences companies work outwhere the pieces will fall for theirstrategies,” he said.

According to the survey, over thenext 12 months, U.S. companies in-tend to increase investment in mar-keting and distribution (29 percentof respondents), as well as clinicaltrials (21 percent) and late-stage

R&D (18 percent).The greatest challenges to growth

are changes in health care policyand reimbursements (29 percent)and high drug development costs(24 percent).

For the report, Reed Smith sur-veyed companies in Asia, NorthAmerica and Europe.

Thirty-four percent were compa-nies with between $100 million and$1 billion in revenue, 33 percentwere between $1 billion and $5 bil-lion, and 33 percent were largerthan $5 billion.

Read the full report athttp://dealdimensions.reedsmith.com/life-sciences. �


“The M&Aboom inthe lifesciencessectorlooks set tocontinue.”Nick Cheek, Remark




LOOKING BACK: CONSOLIDATION MEANS FEWER BANKS, BANK HEADQUARTERS IN MICHIGAN

The national bank consolidationbinge that has seemingly put newsigns out in front of your localbranch every few years has changedan industry that was once hyper-local.

As recently as 1985, state law pro-hibited banks in Michigan fromhaving branches more than 25miles from their headquarters.

But that year, Ohio, Indiana andMichigan opened their borders toeach others’ banks. And in 1997,

federal legislation opened interstatebanking across the U.S.

Here’s the genealogy of some ofMichigan’s biggest bank networks:

� One of the first big acquisitionshappened in 1995, when the NNaattiioonn--aall BBaannkk ooff DDeettrrooiitt was bought by theFFiirrsstt NNaattiioonnaall BBaannkk ooff CChhiiccaaggoo. Sincethen, the bank has been bought byChicago-based BBaannkk OOnnee CCoorrpp..,which was later bought by New YorkCity-based JJ..PP.. MMoorrggaann CChhaassee && CCoo..

� In 1997, Cleveland-based NNaa--

ttiioonnaall CCiittyy CCoorrpp.. bought Kalamazoo-based FFiirrsstt ooff AAmmeerriiccaa, and in 2008,Pittsburgh-based PPNNCC FFiinnaanncciiaall SSeerr--vviicceess GGrroouupp IInncc.. bought National City.

� More recently, Akron, Ohio-based FFiirrssttMMeerriitt CCoorrpp.. bought Flint-based CCiittiizzeennss RReeppuubblliicc BBaannccoorrpp IInncc..In February, shareholders at Novi-based LLoottuuss BBaannccoorrpp IInncc.. approvedthe bank’s acquisition by Farming-ton Hills-based LLeevveell OOnnee BBaannccoorrppIInncc.., and last month, Level One an-nounced it was buying Farmington

Hills-based BBaannkk ooff MMiicchhiiggaann.In 1985, all Michigan banks were

headquartered here. Now, eight ofthe 10 largest banks in the state bydeposits are headquartered in otherstates. The exceptions: Troy-basedFFllaaggssttaarr BBaannkk at No. 7 and Midland-based CChheemmiiccaall BBaannkk at No. 8.

Another change: Large bankshave been shedding branches thatin the days of the 25-mile rule weregeographically necessary, and inthe world of tapping on a smart-

phone aren’t. Last year, BBaannkk ooff AAmmeerriiccaa agreed

to sell 24 of its branches in Michiganto Columbus, Ohio-based HHuunnttiinngg--ttoonn BBaannccsshhaarreess IInncc.., which is expand-ing its footprint here.

And Jack Shubitowski, presidentand CEO of Milford-based HHuurroonnVVaalllleeyy SSttaattee BBaannkk, has formed a hold-ing company to borrow money orsell shares to fund the acquisition ofbranches big banks no longer want.

Tom Henderson

CRAIN'S LIST: MICHIGAN BANKS��$��

Rank

��$��'�"�� #�� !�(�)

��(+��&��)

� �� *��

� ��%��%��

��

�� (+��&��)

�� %��%��

� ��

1J.P. Morgan Chase & Co.611 Woodward Ave., Detroit 48226(313) 256-8500; www.jpmorganchase.com

John Cartermarket president

$39,107.1$36,983.4

249 $1,030,317.9 5,296

2Comerica Bank411 W. Lafayette, Detroit 48226(248) 371-5000; www.comerica.com

Michael RitchieMichigan market president

27,493.625,848.7

215 30,244.7 261

3PNC Bank755 W. Big Beaver Road, Troy 48084(800) 243-7274; www.pnc.com

Ric DeVoreregional president for Detroit andSoutheast Michigan

16,346.615,590.8

216 221,641.3 2,561

4Bank of America2600 W. Big Beaver Road, Troy 48084(800) 643-9600; www.bankofamerica.com

Matthew Elliottmarket president for Michigan

15,677.113,174.8

127 1,153,891.7 4,734

5Fifth Third Bank1000 Town Center, Southfield 48075(800) 246-5372; www.53.com

David Girodatpresident and CEO, EasternMichigan

15,161.613,788.1

246 90,226.3 1,093

6Huntington National Bank801 W. Big Beaver Road, Suite 500, Troy 48084-4724(248) 244-3541; www.huntington.com

John Irwinregion president

9,489.68,335.2

191 44,482.9 569

7Flagstar Bancorp Inc.5151 Corporate Drive, Troy 48098-2639(248) 312-2000; www.flagstar.com

Alessandro DiNellopresident and CEO

7,885.16,856.2

100 0.0 0

8Chemical Financial Corp. (Chemical Bank)235 E. Main St., Midland 48640-0569(989) 839-5350; www.chemicalbankmi.com

David Ramakerchairman, president and CEO

6,364.45,234.8

181 0.0 0

9FirstMerit Michigan900 Tower Drive, Suite 100, Troy 48098(248) 293-3040; www.firstmerit.com

Sandra Piercechairman and CEO

5,107.65,345.2

138 14,660.2 232

10Charter One Bank B

27777 Franklin Road, Southfield 48034(248) 226-7998; www.charterone.com

Michael Dolson, state director,commercial banking; KarenMinghine-Hagenian, executive vicepresident, consumer banking

4,951.04,542.4

98 68,388.2 753

11Talmer Bancorp Inc.2301 W. Big Beaver Road, Suite 525, Troy 48084(248) 649-2301; www.talmerbank.com

David Provostchairman, president and CEO

3,084.02,068.2

43 1,205.3 28

12Wells Fargo & Co.101 W. Washington St., Marquette 49855(906) 228-1203; www.wellsfargo.com

Sang Kimregional president

2,690.62,489.9

18 1,083,601.4 6,214

13TCF Bank17440 College Parkway, Livonia 48152(734) 542-2900; www.tcfbank.com

Joseph Doylepresident, Michigan

2,600.32,484.4

54 13,401.7 343

14Mercantile Bank Corp.310 Leonard St. NW, Grand Rapids 49504(616) 242-7760; www.mercbank.com

Michael Pricechairman, president and CEO

2,280.62,319.8

54 0.0 0

15Independent Bank Corp.230 W. Main St., Ionia 48846(800) 355-0641; www.ibcp.com

William Kesselpresident and CEO

1,998.71,941.2

67 0.0 0

16Old National Bank2723 S. State St., Ann Arbor 48104(734) 887-2600; www.oldnational.com

Todd Clarkregion CEO

1,332.9NA

38 7,549.6 152

17Macatawa Bank Corp.10753 Macatawa Drive, Holland 49424(616) 820-1444; www.macatawabank.com

Ronald Haanpresident and CEO

1,332.91,218.4

30 0.0 0

18KeyBank N.A.100 S. Main, P.O. Box 8612, Ann Arbor 48107(800) 539-2968; www.keybank.com

Kirk Albertpresident, Michigan

1,150.81,046.8

23 71,418.3 979

19MBT Financial Corp. (Monroe Bank & Trust)102 E. Front St., Monroe 48160(734) 241-3431; www.mbandt.com

H. Douglas Chaffinpresident and CEO

1,122.81,051.5

24 0.0 0

20Isabella Bank Corp.401 N. Main, Mt. Pleasant 48858(989) 772-9471; www.isabellabank.com

Jae Evans, CEODennis Angnerpresident and CFO

1,094.51,063.1

27 0.0 0

This list ranks banks and bank holding companies with a presence in Michigan. Figures are from the FDIC's deposit market reports, which are based on the branch/office deposits for all FDIC-insuredinstitutions as of June 30. It is not a complete listing but the most comprehensive available. Companies are listed with the address and top executive of their main metro Detroit office. Actual figuresmay vary. NA = not available.

B Charter One is a brand name of Citizens Bank, N.A.

LIST RESEARCHED BY FDIC


18

Pistons.com/premium

(248) 377-8477

*LIMITED INVENTORY AVAIL ABLE

HOST YOUR HOLIDAY EVENT AT A PISTONS GAME!Book your suite in December and receive a

complimentary champagne toast.


CALENDARUPCOMING EVENTS

IInnssiiddee tthhee CCEEOOMMiinndd. 8-10 a.m.DDeecc.. 11. DetroitRegionalChamber.KKoouuhhaaiillaa HHaamm--mmeerr, CEO, GGhhaa--ffaarrii AAssssoocciiaatteessLLLLCC, shares herstory andunique per-

spective on leadership. Ham-mer is the board president ofthe EEnnggiinneeeerriinngg SSoocciieettyy ooff DDeettrrooiittand is on the DDeettrrooiitt RReeggiioonnaallCChhaammbbeerr board of directors.Cranbrook Institute of Science,Bloomfield Hills. $30 chambermembers, $55 nonmembers.Preregistration is required; norefunds will be given. Contact: Beverly Maddox, (313) 596-0343; email: [email protected].

SSuucccceessssffuull TTuurrnnaarroouunnddss:: TThhee UU..SS..BBaannkkiinngg IInndduussttrryy aanndd DDeettrrooiitt. 11:30a.m.-1:30 p.m. DDeecc.. 77. DetroitEconomic Club. Speaker is BBrruucceeVVaann SSaauunn, chairman and CEO,CCiittiizzeennss FFiinnaanncciiaall GGrroouupp. WestinBook Cadillac, Detroit. $45 DECmembers, $55 guests of DECmembers, $75 nonmembers.Contact: (313) 963-8547; email:[email protected].

SSttaattee ooff tthhee RReeggiioonn. 5-7 p.m.DDeecc.. 99. Detroit Regional

Chamber. The chamber willrelease its second annual Stateof the Region, which offers ananalysis of the economicindicators related to businessgrowth, talent, innovation andinternational commerce forSoutheast Michigan. WestinBook Cadillac, Detroit. $30chamber members, $595 tojoin. Contact: Janelle Arbuckle,(313) 596-0340; email:[email protected].

MMiicchhiiggaann SSuupprreemmee CCoouurrtt JJuussttiicceess.11:30 a.m.-1:30 p.m. DDeecc.. 1155.With Justice BBrriiddggeett MMaarryyMMccCCoorrmmaacckk and Chief JusticeRRoobbeerrtt YYoouunngg JJrr. MotorCityCasino Hotel, Detroit. $45 DECmembers, $55 guests of DECmembers, $75 nonmembers.Phone: (313) 963-8547; email:[email protected].

MMuullttiiccuullttuurraall mmeeddiiaa lluunncchheeoonn. 11a.m.-2 p.m. JJaann.. 1144. The AjamuGroup LLC. Honors ethnicgroups for their achievementsin the automotive industry.Keynote speaker is HeismanTrophy winner TTiimm BBrroowwnn on“Managing Your Brand’s Image.”Portion of the proceeds benefitsOOrrcchhaarrddss CChhiillddrreenn’’ss SSeerrvviicceess ofMichigan and PPrroojjeecctt MMeeddiisshhaarreeof Haiti. Westin Book Cadillac,Detroit. $75 general admission;$150 VIP admission includingreception with Tim Brown afterlunch. Contact: Cheryl Ajamu,

Calendar guidelines. Visitcrainsdetroit.com and click “Events”near the top of the home page.Then, click “Submit Your Events”from the drop-down menu that willappear. Fill out the submission form,then click “Submit event” at thebottom of the page.

More Calendar items can befound at crainsdetroit.com/events.

(248) 223-0904; email:[email protected];website: www.ajamugroup.com.

PPrrooffeessssiioonnaallLLeeaaddeerrsshhiipp —— TThheeJJaacckk AArroonnssoonnSSttoorryy. 7:30-9a.m. JJaann.. 2200.LeadershipOakland.Featuring JackAronson,founder, GGaarrddeenn

FFrreesshh. MSU ManagementEducation Center, Troy. $32members, $36 nonmembers.Website: leadershipoakland.com.

DDeettrrooiitt PPoolliiccyy CCoonnffeerreennccee. 7:30a.m. FFeebb.. 2244. Detroit RegionalChamber. Keynote remarks byDDaavviidd MMaarraanniissss, Pulitzer Prize-winning journalist. MotorCityCasino Hotel, Detroit. $159chamber members, $225nonmembers. Contact: JanelleArbuckle, (313) 596-0340; email:[email protected].

Aronson

Hammer


19

Finance Experience In Your Corner.®

Commercial, asset-based and real estate fi nance.

Loan restructuring and workouts, mergers and acquisitions.

Contact Michael Romaya at [email protected] Detroit Novi Grand Rapids Kalamazoo Grand Haven Lansing

First Tier Ranking in Corporate Law and Commercial and Construction Litigation


DETAILSDEALS &

Deals & Details guidelines.Email [email protected] any Deals & Details item as amodel for your release, and look forthe appropriate category. Withoutcomplete information, your itemwill not run. Photos are welcome,but we cannot guarantee they willbe used.

ACQUISITIONS &MERGERS

PPeennsskkee AAuuttoommoottiivvee GGrroouupp IInncc..,Bloomfield Hills, announced ithas acquired AAuuddii EEaattoonnttoowwnn,PPoorrsscchhee MMoonnmmoouutthh, JJaagguuaarr MMoonnmmoouutthhand LLaanndd RRoovveerr MMoonnmmoouutthh inMonmouth County, N.J., fromSScchhnneeiiddeerr NNeellssoonn AAuuttoo GGrroouupp. Thefranchises are expected annuallyto sell approximately 2,400 newand used vehicles and generateabout $175 million in revenue.Website: penskeautomotive.com.

BBoorrggWWaarrnneerr IInncc., Auburn Hills, aglobal powertrain supplier, hasfinalized its acquisition of RReemmyyIInntteerrnnaattiioonnaall IInncc., Pendleton, Ind., amanufacturer of rotatingelectrical components. Websites:borgwarner.com, remyinc.com.

MMCC33 CCaarrddiiooppuullmmoonnaarryy, Dexter, amedical device company,announced it has acquiredsurgical cannula product assets,including brand names such asSarns Soft-Flow Arterial Cannula,from TTeerruummoo CCaarrddiioovvaassccuullaarr SSyysstteemmssCCoorrpp., Ann Arbor. MC3 will build a60,000-square-footmanufacturing facility on itsDexter campus, with the goal ofbringing back Sarns Soft-FlowArterial Cannula during the firsthalf of 2016. Websites:mc3corp.com, terumo-cvs.com.

GGrreegg FFrraazziieerr CCPPAA PPLLLLCC, Detroit, anaccounting firm and MMiiccrroossoofftt-certified partner, completed thedevelopment of a cloud-basedfield service tracking and billingapplication that runs on Mi-crosoft Azure for SSiillvveerrssmmiitthh IInncc..,an engineering company in Gay-lord that provides hardware andsoftware that automatically col-lect data and enable the process-ing of billable transactionsthrough Microsoft Dynamics GP.Websites: silversmithinc.com,gfcpa.com.

ZZiippLLooggiixx LLLLCC, Fraser, a real estatetechnology company, announcedthat RReeaallttyy PPiilloott LLLLCC, Phoenix, a vir-tual, cloud-computing enterprisetechnology platform for real es-tate professionals, has beenadded to the zipAlliance Pro-gram. Also, the California, SouthCarolina and the Hawaii associa-tions of realtors have renewedagreements to offer ZipLogix’szipTMS as to all their members.The Texas and Wisconsin realtorsassociations renewed their agree-ments to provide real estate pro-fessionals access to their officialforms and zipForm Plus Software.Website: ziplogix.com.

CONTRACTSAAllcchheemmyy GGrroouupp, Troy, a market-

ing agency, has added CCuussttoommHHoommee HHeeaalltthh IInncc.., Royal Oak; TThheeCCoommmmuunniittyy HHoouussee, Birmingham;and OOrrllaannss GGrroouupp, Troy, to its clientroster. Website: alchemygp.com.

55 SSttaarr OOuuttddoooorr LLLLCC, West Bloom-field Township, an outdoor adver-tising business, has built its firstdigital billboard face on I-94 atJoy Boulevard for southbound

traffic, next to the Gibraltar TradeCenter, Mt. Clemens. Website: 5staroutdoor.com.

WWeebbeerr SShhaannddwwiicckk, Birmingham,has been appointed public rela-tions agency of record for MMGGMMGGrraanndd DDeettrrooiitt, a unit of MMGGMM RReessoorrttssIInntteerrnnaattiioonnaall, Las Vegas. Website: webershandwick.com.

AAggrreeee RReeaallttyy CCoorrpp.., BloomfieldHills, and MMeerriiddiiaann RReessttaauurraannttss UUnnlliimm--iitteedd LLCC, Ogden, Utah, a franchiseoperator of 80 Burger King restau-rants in Arizona, Minnesota, Mon-tana, North Dakota, Utah andWyoming, announced they haveentered into an agreement to de-velop up to 10 more Burger Kingrestaurants operated by Meridianin the regions in which they oper-ate. Website: agreerealty.com.

QQuuaalliitteecchh, Bingham Farms, atechnology integrator and soft-ware reseller, was selected by HHiillll--ssiiddee IInnvveessttmmeennttss, Plymouth, a prop-erty management company, topurchase the Skyline Property

Management Solution. HillsideInvestments also contracted forSkyline training. Websites:hillside-investments.com,qualitech.net.

RRuubbiiccoonn GGeennoommiiccss IInncc.., Ann Arbor,announced an agreement with EEuu--rrooffiinnss GGeennoommiiccss for U.S. distribu-tion of its DNA library preparationproducts, including the ThruPLEXDNA-sequencing kit and Rubi-con’s new ThruPLEX Plasma-se-quencing kit. EEuurrooffiinnss SScciieennttiiffiicc,Luxembourg, sells selected bioan-alytical products worldwide. Web-sites: rubicongenomics.com,eurofinsgenomics.com.

EXPANSIONSLLuubbyy’’ss FFuuddddrruucckkeerrss RReessttaauurraannttss LLLLCC,

Houston, part of LLuubbyy’’ss IInncc.., hasopened a Fuddrucker’s restaurantat 13883 Lakeside Circle, SterlingHeights. Regional franchisee isDean Antonis of AAGG FFooooddss LLLLCC.Telephone: (586) 566-7002. Web-site: fuddruckers.com.

AAssppeenn DDeennttaall MMaannaaggeemmeenntt IInncc..,

East Syracuse, N.Y., has openedan AAssppeenn DDeennttaall ooff MMiicchhiiggaann PPCC officeat 4929 S. Baldwin Road, Suite104, Lake Orion. Telephone: (248)426-7209. Website: aspendental.com.

MMiinnaaccss GGrroouupp UUSSAA IInncc.., Farming-ton Hills, an outsourcing busi-ness solutions company, is open-ing a center in Richmond, Va.Website: minacs.com.

DDoommiinnoo’’ss PPiizzzzaa’’ss IInncc.., Ann Arbor,has opened a store in Minsk, Be-larus. DDPPEEUU FFrraanncchhiissiinngg is the fran-chisee for the brand in Belarus.Website: dominos.com.

RRee//MMaaxx ooff SSoouutthheeaasstteerrnn MMiicchhiiggaann,Troy, opened RRee//MMaaxx DDyynnaammiicc,7495 N. Telegraph Road, Monroe.The office is owned andmanaged by broker/owner CraigBollerud. Telephone: (734) 264-1502. Website: dynamic.remax-detroit.com.

MMaattttrreessss UUSSAA IInncc.., Brighton, hasopened a UU..SS.. MMaattttrreessss warehouseand store at 35799 IndustrialRoad, Livonia. Website: us-mattress.com.

MOVESLLuubbyy’’ss FFuuddddrruucckkeerrss RReessttaauurraannttss

LLLLCC, Houston, part of LLuubbyy’’ss IInncc..,announced that the Fuddruckers restaurant at 42757Woodward Ave., BloomfieldTownship, has moved to 25309

Evergreen Road, Southfield. SaadHabba of SS&&ZZ IInnvveessttmmeenntt LLLLCC is thefranchisee. Telephone: (248) 809-6714. Website: fuddruckers.com.

NEW PRODUCTSCCaarrbboonn MMeeddiiaa GGrroouupp LLLLCC, Bing-

ham Farms, a digital media firm,announced that CCaarrbboonnTTVV islaunching a new original series“American Harvest,” a docu-se-ries about farming. “AmericanHarvest” is airing on RRFFDD--TTVV andis available on demand and forfree at www.carbontv.com andthrough the CarbonTV apps onRoku, Samsung Smart TVs andXbox One.

HHiinnoo TTrruucckkss, Novi, a TTooyyoottaa GGrroouuppcompany, has expanded its In-sight platform to create a con-nected vehicle for all customers.The platform delivers telematics,remote diagnostics and casemanagement. This platform willbe standard fit across all 2017models. Website: hino.com.


ADVERTISING SECTION

Crain’s has moved its complete list ofappointments and promotions towww.crainsdetroit.com/peopleonthemove.Guaranteed placement in print and online canbe purchased at this website.

Susan KampeChief Information Officer,

Cooper Standard

Susan Kampe will beresponsible for leading thetransformation of the

Company’s information technology (IT) functionconsistent with Cooper Standard’s ProfitableGrowth Strategy. Most recently served asmanaging partner and founder of ZangConsulting, a business technology consultingand IT services company. Prior, she held ITexecutive roles with Johnson Controls andMeritor (formally Arvin Meritor) for more than 10years.

Keith ReynoldsStrategic Account Directorfor Carhartt's Farm andRanch Channel,

Carhartt, Inc.

Reynolds will be responsiblefor driving Carhartt’s distribution strategy for theFarm and Ranch channel, as well as leading thebusiness and team that serves the strategicFarm and Ranch accounts. Prior to Carhartt,Reynolds served as Vice President ofMerchandising at Tractor Supply Co. Also,Reynolds previously owned a company thatimported and sold lawn/garden items, toys andcommercial bath products to mass channel andspecialty stores.

AUTOMOTIVE

MANUFACTURING

Edward S. GuskyAttorney,

Kotz Sangster WysockiP.C.

Edward S. Gusky, an attorneywith Kotz Sangster Wysocki

P.C., has been appointed Real Estate PracticeGroup Leader. Mr. Gusky focuses on all aspectsof real estate law, including complex acquisitionand financing transactions. He representsborrowers and lenders in sophisticated financialtransactions, including multi-family, assistedliving, commercial shopping and office inMichigan and throughout the nation. He hasextensive experience representing borrowerswith multi-family loans insured by HUD/FHA,closing transactions in excess of $400,000,000.Mr. Gusky, a graduate of the University ofMichigan Law School, is licensed to practice inMichigan and New York. He holds aMartindale-Hubbell AV Preeminent Ranking.

LAW

David BoneVice President of BusinessPlanning,

Carhartt, Inc.

David Bone will provideoversight for Carhartt’s new

business planning team which includes threedistinct functional areas – Partnership Planning,Central Planning, and Strategic Planning andPricing. Bone worked at American EagleOutfitters in several leadership positions,including Director of Planning, MerchandisePlanner and Planning Manager. He alsoreceived substantial merchandising experienceat Montgomery Ward and Famous Footwear.

MANUFACTURINGTECHNOLOGY

E'Lois ThomasChief Administrative Officer,

SEEL, LLC

Thomas reports directly toLouis E. James, CEO, withdirect responsibility for

Purchasing and Contract Management with allclients as well as all Administration for SEEL.Her role internally includes management ofFinance, IT and Risk Management. Afterworking for SEEL’s parent company fornumerous years, Thomas joined SEEL in 2011as a Program Mgr. Thomas has served as CorpController with an automotive company, DeputyFinance Director with a local municipality andVP at a small nonprofit.

Shelby MedinaDirector BusinessDevelopment,

G-TECH Services, Inc.

Medina will spearhead G-TECH's efforts to market

and brand across a broader industry scale andestablish a new sales program for the firm.She brings more than 12 years of sales,professional staffing, management, and teamleadership experience. Medina joins G-TECHfrom Volt Workforce Solutions, where sheserved as Sales Manager and Senior BusinessDevelopment Manager. Shelby consistentlyexceeded sales revenue goals and added newcompanies to her previous employer’s clientlists.

STAFFING &SERVICES

ENGINEERING &CONSULTING

Robert M FulkChief Operating Officer,COO,

Centric HERO LearningSystems

Rob will manage the HEROlearning system technology, business,marketing, and software development teams.He has the responsibility of scaling theplatform with customers across the USA,South America, and Europe and expanding thebusiness globally. Entrepreneurial focusedexecutive serving Fortune 100 corporate,education, and government institutions acrossverticals - streamlining operations to supportstrategic objectives. Former CEO ofCourseWeaver, CTO Federal Program, EVP HRPartners.

Katie ClowDirector of Risk andTreasury Services,

Carhartt, Inc.

Clow had been a SeniorManager of Risk and

Treasury Services since 2012 at Carhartt,where she was responsible for evaluating riskand developing a cash flow forecasting modelthat allowed for proactive solutions forfinancing Carhartt’s growth. Clow will manageCarhartt's corporate insurance program andtreasury needs, assess business practices toensure risks are mitigated and transferredappropriately, forecast and manage cash flow,and evaluate foreign currency and commodityrisk.

MANUFACTURING

Ford Estates CEO Woodnamed Lions president

RRoodd WWoooodd, who had been pres-ident and CEO of FFoorrdd EEssttaatteesssince 2007, has been namedpresident of the DDeettrrooiitt LLiioonnss.

Wood, 55,will overseethe businessside of theNNaattiioonnaall FFoooott--bbaallll LLeeaagguueeteam and re-port directlyto owner andChairmanMMaarrtthhaa FFoorrdd.

Ford also announced the cre-ation of an advisory board tosearch for a general manager forthe team. The board is com-prised of Ford family membersand the team’s board that in-cludes Ford, MMaarrtthhaa FFoorrdd MMoorrssee,SShheeiillaa FFoorrdd HHaammpp, BBiillll FFoorrdd JJrr.., EElliizz--aabbeetthh FFoorrdd KKoonnttuulliiss and Wood.

Prior to joining Ford Estates,which advises the Ford familyon business and investments,Wood was executive vice presi-dent of wealth management forWWiillmmiinnggttoonn TTrruusstt CCoo. in Delawareand served in various executivepositions at CCoommeerriiccaa BBaannkk.

The move comes after MarthaFord fired President TToomm LLeewwaannddand General Manager MMaarrttiinn MMaayy--hheeww in a management shakeup.

St. John promotes Hobanas president in Detroit

Warren-based SStt.. JJoohhnn PPrroovvii--ddeennccee HHeeaalltthh SSyysstteemm promotedRRoobbeerrtt HHoobbaann to president of SStt..JJoohhnn HHoossppiittaall aanndd MMeeddiiccaall CCeenntteerrin Detroit.

Hoban, 60,replaces DDaavviiddBBrrooookkss, wholeft in June tobecome pres-ident of SStt..JJoosseepphh MMeerrccyyAAnnnn AArrbboorrand SStt.. JJoosseepphhMMeerrccyy LLiivv--iinnggssttoonn.

Hoban previously was presidentof SStt.. JJoohhnn PPrroovviiddeennccee CCaarree CCoonnttiinn--uuuumm.

Davidson Foundationhires Ziraldo, 2 others

The Southfield-based WWiilllliiaammDDaavviiddssoonn FFoouunnddaattiioonn has hiredthree program/grant managers,among them JJoohhnn ZZiirraallddoo, formerpresident and CEO of LLiigghhtthhoouusseeooff OOaakkllaanndd CCoouunnttyy, who will serveas a senior program officer forSoutheast Michigan.

Also new are KKaarrii AAlltteerrmmaann, asa senior program officer of Jew-ish life portfolios, and SSuuzzaannnneeMMoorraann, who in August wasnamed the first grant managerfor the foundation. Altermanwas Detroit regional director forthe AAmmeerriiccaann JJeewwiisshh CCoommmmiitttteeee inBloomfield Hills, and Moran wasgrants manager for the Detroit-based SSkkiillllmmaann FFoouunnddaattiioonn. �

Rod Wood

Robert Hoban

Advertising information: Marla Wise at [email protected] (313) 446-6032CLOSE DATE: Dec. 7, 2015PUBLISH DATE: JAN. 18, 2016

IN THE 2016 NORTH AMERICAN INTERNATIONAL AUTO SHOW GUIDE

IN PARTNERSHIP WITH

*2014 SHOW STATISTICS

PEOPLE:SPOTLIGHT


21

POSITIONS AVAILABLE

MISCELLANEOUS

AUCTIONS AUCTIONS COMMERCIAL PROPERTIES

REAL ESTATE

JOB FRONT

MARKETPLACE

The Crain’s reader: 29.2% are with companiescontemplating moving/expanding. Help them find you by advertising in Crain’s Real Estate section.

313.446.6086 • FAX: 313.446. 7E-Mail: cdbclassi [email protected]

034 Advertise yourProducts and Services inCrain’s Detroit Business

Investment Home Auctions

MI DANIEL SCOTT NELSON RE LIC 6502380607; WILLIAMS & WILLIAMS RE LIC 6505363368.BUYER’S PREMIUM MAY APPLY.

800.982.0425 • williamsauction.com/MI

real estateauctions

11735 Kennebec St, Detroit 16817 Asbury Park, Detroit

Bid Online December 4-11

DETROIT, MI• 11095 Findlay St• 11130 Portlance St• 11257 Roxbury St• 11401 Minden St.• 11420 Engleside St• 12505 Laing St• 13074 Kilbourne St• 14907 Saint Marys St• 15490 Asbury Park• 15838 Washburn St

• 15844 Lindsay St• 15894 Bringard Dr• 16257 Manning St• 16567 Mark Twain St• 17359-63 Wisconsin St• 17559 Santa Rosa Dr• 17583 Stoepel St• 17597 Stoepel St• 17605 Stoepel St• 18111-13 Santa Barbara• 18244 Stansbury St

• 18290 Prairie St.• 18291 Faust Ave• 18301 Mendota St• 18685 Prest Street• 18831 Charest St• 18911 Rosemont Ave• 19006-10 Moross Rd• 19763-69 Schaefer Hwy• 20034 Ferguson St• 5315 Lodewyck St• 5945 Three Mile Dr

• 6143 Hereford St• 6403 Brace St• 7022 Thatcher• 7245 Evergreen Ave• 9269 Philip St• 9925 Somerset Ave

EASTPOINTE, MI• 16821 E 8 Mile Rd

WARREN, MI• 8663 Jewett Ave

DETROIT, MI • 11735 Kennebec Street3BR 1BA 1,207+/- sf home. Built in 1930.Nominal Opening Bid: $500Bid Online Only at auctionnetwork.comAuction Starts: 10am EST, Mon Dec 7Auction Ends: 12:40pm EST, Fri Dec 11

DETROIT, MI • 16817 Asbury Park3BR 1BA 797+/- sf occupied home. Nominal Opening Bid: $5,000Bid Online Only at auctionnetwork.comAuction Starts: 10am EST, Mon Dec 7Auction Ends: 2:30pm EST, Fri Dec 11

AUCTIONBy Order of the Court Appointed Receiver

Monroe Golf & Country ClubDonald Ross Design - Located at 611 Cole Road, Monroe, MI

Auction in Conjunction with Steve Reeser MI Real Estate License 650414079

CrainsDetroit.com/JobConnect |

MATCH

SURVEY

ANALYZESENIOR STAMPING PROCESS AUTOMATION ENGINEER

for Christy Industries Inc., in Troy, MI. Duties: Support design of transfer press automations throughcomputer-aided simulations; create automation press curves from existing stamping plant equip; program& dev software apps for automation & part handling, & apply FEA to solve stamping & structural designproblems; coor. stamping ops in support of new program launches, inc’l determining tool & die specs;interface w/ tooling eng’rs re product & die design, design for manufacturability, & quality assurancetesting; dev auto component mfg tools & dies in accordance w/ given specs, inc’l providing design support;process & determine automation reqs for progressive, tandem & transfer dies; maintain CAD data for datatracking & storage, & organize data exchange b/twn customers & Transfer Kinematics team; trainDesigners & Program Mgrs to maximize prod’n speeds by optimizing die designs; supervise Transfer

Kinematics team. Req’s: Mas. Deg. in Ind’l or Mech’l Eng’g, or foreign equiv; 2 yrs of exp in a mfg or

mech’l eng’g pos’n in auto industry. Will also accept Bach. Deg. & 5 yrs of app. work exp. Exp must

inc’l: Sheet metal stamping & die processing, inc’g associated FEA tools for formability simulation; dieconstruction standards for draw, trim, flange, re-strike, cam trim, & flange ops, inc’l stamping & transferpress automation simulation; Unigraphics NX9 & CATIA CAD systems for parts & assembly design &surface modeling; FEA analysis for stamping die strength validation & vibration analysis w/ Nastran orLS-DYNA; programming Windows apps or MS Excel for motion calculations; & mechanism simulation &optimization w/ MBD software, inc’l customizing MBD software for press automation simulations. Exp canbe acq’d concurrently.

Apply: [email protected]. Identify Sr. Stamping Process Automation Eng’r pos. EOE.

MULTI-TENANT

INDUSTRIAL BUILDINGS

10 ~ 2,400 Sq. Ft. and 5 ~ 1,500 Sq. Ft. Bldgs

34,000 Sq. Ft. Total ~ Utilities Indivually Metered

$1.5M O.B.O. ~ 10% Cap

**********************

50 Acres Residential Land on 25 Mi Rd. Just

E. of Gratiot. WNS on prop - $650K O.B.O.

*********************

GRAND BLANC ~ 9 - 50 ft. Lots in very nice sub

all together, City WNS, paved Rd. $8500 Ea. O.B.O.

**********************

14,000 Sq. Ft. Off. Bldg, Sterling Heights on

Van Dyke N. of 17 MI Rd. $950K ~ 90% Leased

BILL MCMACHEN ~ 586-915-4441

[email protected]

NEED WAREHOUSING?

Plymouth & Livonia Area• Cross-Dock Services • Trucking Services

• Diverse Supplier • Reasonable Rates

Call 810-701-0833


Crain launches digital biz publications in 9 U.S. marketsBy Marti Benedetti

[email protected]

CCrraaiinn CCoommmmuunniiccaattiioonnss IInncc.. lastweek launched a series of personal-ized, digital business publicationsin nine U.S. markets as part of aplan to expand the Crain brand na-tionwide as it approaches its 100thanniversary.

The markets for the Monday-through-Friday morning emailnewsletters are Boston, Philadel-phia, Atlanta, Houston, Dallas, SanFrancisco, Silicon Valley, Los Ange-les and Washington, D.C.

The new publications are beingadded to Crain’s established citybusiness journal brands in NewYork, Chicago, Detroit and Cleve-land, including Crain’s Detroit Busi-ness. Next year marks Detroit-basedCrain Communications’ centennial.

Under the tagline “Business NewsJust Got Personal,” each brand willcarry the Crain name and market,such as Crain’s Boston, Crain’s LosAngeles and Crain’s Houston.

Crain hired 11 journalists tomanage the brands and providecontent.

The nine new brands expand thecompany’s mission to provide one-stop news sources for businessleaders.

“For almost 100 years, Crain hasbeen the leading source of businessnews for top executives and deci-sion-makers in the U.S. andabroad,” KC Crain, executive vicepresident and director of corporateoperations at Crain Communica-tions, said in a news release. “Thelaunch of these new brands offersCrain the ability to better grow ouraudience with daily and breakingbusiness news in our readers’hometowns and customized totheir preferences.”

The new city business brandsfeature email newsletters that cus-tomize content based on readerpreferences and engagement.

Daily content includes a mix ofcurated local and industry business

news, articles from Crain publica-tions and original content, includ-ing a series titled “If I Knew Then…” featuring interviews with localindustry leaders.

“While the way we deliver con-tent continues to evolve, what re-mains the same is our commitmentto giving readers a business edgeevery day by providing the newsmost important to them,” Crainsaid.

Crain has appointed Sean Flana-gan as publisher of the new brands.Formerly the vice president andworldwide publisher of NationalGeographic, Flanagan previouslyheld positions at Maxim, Reader’s

Digest and Men’s Health maga-zines.

Technology being employed in-cludes customer relationship man-agement software, which is de-signed to help businesses managecustomer data and interaction, and“technology around email thathones in on what people want,”Crain said.

“Success for this is greater readerengagement and growth, seeingmore people sign up for the emails,”KC Crain said. “We’re excited to seewhat happens in its first coupleweeks.”

The company said that in thepast when Crain launched a new

publication, it cost millions of dol-lars, but with the latest technology,it can simultaneously launch ninenew digital brands at a much lowercost.

KC Crain said the company isstarting this now because currenttechnology allows for it. “And we’rebeing smart about using our data,”he said.

Readers can sign up to receivethe free e-newsletters by visitingCrains.com.

The company’s portfolio also in-cludes Automotive News, Autoweek,Advertising Age, Modern Healthcare,Plastics News, Business Insuranceand Pensions & Investments. �

“The launch of these new brands offers Crainthe ability to better grow our audience withdaily and breaking business news in ourreaders’ hometowns.”

KC Crain, executive vice president and director of corporate operations, Crain Communications


year’s Accelerate Michigan eventNov. 5 at OOrrcchheessttrraa HHaallll in Detroit,where 10 finalists made their pitchesfor the first-place prize of $500,000.

During the strolling dinner thatpreceded the announcement thatBBaannzzaa LLLLCC, a Detroit company found-ed last year to make pasta fromchickpeas, had won the grand prize,and as a jazz band played, conversa-tion by attendees alternated be-tween praising the caliber of en-trants this year and wonderingwhether there would be another Ac-celerate Michigan next year.

Those rumors and worries werereinforced by a comment made a lit-tle later by Bigelow at the podium onthe Orchestra Hall stage before thewinners were announced.

“We’re about to go into stormywaters over the next 12 to 24 months.Let’s hope for smooth sailing afterthat,” she said.

Recent turmoil at the MEDC start-ed the waters roiling. Mike Finney,then president and CEO of theMEDC, co-founded AccelerateMichigan with Egner, and the organ-ization had been a big booster eversince.

But the MEDC has long been atarget of Republican legislators for itssupport of a range of entrepreneurialprograms, and it suffered a budgetcut of 27 percent and 65 layoffs onOct. 1.

Ironically, Egner was one of the

reasons for the worries. Late in Octo-ber, he announced he was leavingthe NEI to join the RRaallpphh CC.. WWiillssoonn JJrr..FFoouunnddaattiioonn as CEO on Jan. 1.

The NEI was launched in 2009with a fund of $100 million raisedfrom regional and national founda-tions to help spur economic devel-opment in Southeast Michigan.

The NEI raised a much smallersecond fund of $35 million last year,and no decision has been made yeton whether there will be a third fund.

But Egner said that whether or notthe NEI raises a third fund, “the NEIhas it in its budget next year to go an-other round with Accelerate Michi-gan.”

He declined to disclose anamount but said it would be sub-stantial. He said the NEI contributed$1 million to the first AccelerateMichigan and has contributed de-clining amounts since as other or-ganizations and sponsors came onboard.

Bigelow said the NEI contributed$350,000 for the most recent event.

Funding commitments for nextyear include $250,000 from AAnnnn AArrbboorrSSppaarrkk’s Pre-Seed Capital Fund,$150,000 from Detroit-based IInnvveessttMMiicchhiiggaann and $50,000 from IInnvveesstt DDee--ttrrooiitt’s First Step Fund for the grand-prize winner.

Molnar said he and his staff metlast week to evaluate the recent Ac-celerate Michigan event.

“I consider the event a success,”he said. “It highlights what is goingon in the state of Michigan, but that’snot to say it can’t be done more effi-

ciently or cheaper. They might wantto take a look at other venues.”

The agenda this year included anopening reception Tuesday night inthe GGuuaarrddiiaann BBuuiillddiinngg, pitches by the55 semifinalist companies in threeconference rooms at the WWeessttiinn BBooookkCCaaddiillllaacc on Wednesday and Thurs-day, and the finals Thursday night.

Molnar didn’t rule out the possi-bility of being persuaded by Egner,Bigelow and Martin Dober at InvestDetroit to have the MEDC change itsmind about funding.

“Can I take something we haveearmarked money for and work it sowe can give some of that money toAccelerate Michigan? I don’t have ananswer for that yet. I’ll look into it,”he said. “I’ll try to look at alternatives,but there’s no guarantee.”

Bigelow said she’s open to cuttingcosts. “We’ll figure out how to keepthe integrity and quality of the eventand cut corners on the things thataren’t so important,” she said.

She said she is open to findingother venues, too, but likes the West-in because it can provide three largeconference rooms for the semifinaljudging and likes Orchestra Hall be-cause it helps showcase Detroit andis a setting that helps draw attentionto the event.

“This has done everything every-one involved at the beginning want-ed to accomplish. It’s not a programthat’s getting old or stale,” said SkipSimms, senior vice president at AnnArbor Spark.

He said the quality of finalists hasimproved year by year, and the num-ber of out-of-state venture capitalistswho serve as preliminary onlinejudges or fly in to serve as judges atthe semifinal pitches has gone upevery year.

Invest Michigan, a nonprofit thatmanages the $6.8 million MichiganPre-Seed Fund 2.0, contributes$100,000 toward the $500,000 first-place award and $50,000 toward the$100,000 runner-up prize. The run-ner-up prize was won this year byAnn Arbor-based GGeennoommeennoonn IInncc.., aUUnniivveerrssiittyy ooff MMiicchhiiggaann spinoff that fo-cuses on personalized medicinethrough genomic information.

“The pipeline that comes throughAccelerate Michigan is extremelystrong,” said Charlie Moret, InvestMichigan’s president and CEO.

“I went to my first AccelerateMichigan in 2012, two days after Icame to town. It was my first intro-duction to the ecosystem here, and Iwas completely jazzed,” he said.

“One of the questions I had com-ing here was: Would there be ade-quate deal flow? There was a firehose of deal flow.”

“This has become a crucial must-go-to event in the state of Michigan,”said Dober, a vice president at InvestDetroit and former vice president atMEDC. “It’s really important, and itneeds to take place every year. The 10finalists this year were the best we’vehad. There wasn’t a dud in the mix.”

Invest Detroit is the fiduciary forthe event, with all funding flowingthrough it.

“We will continue to be the fiduci-ary,” said Dober, who said he ismeeting with Egner this week to findout the size of the NEI contribution.He said the bills are still coming in

and being paid, but he is confidentthere will be money left to put to-ward next year’s event.

“I’m not sure how much it will beafter we pay this year’s event, but itwill be substantial,” he said.

“When we started this thing, Ithought it would have a shelf life of10 years, and I still think it will,”Egner said. “People around thecountry are trying to copy it. It wouldbe a shame if we stopped it.” �



Several past winners, finalistshave had further success

“We wanted to turn Michiganfrom a flyover state to a fly-tostate,” said David Egner, execu-tive director of the NNeeww EEccoonnoommyyIInniittiiaattiivvee ffoorr SSoouutthheeaasstt MMiicchhiiggaann,who helped launch the Acceler-ate Michigan Innovation event in2010.

The idea, he said, was to have abusiness plan competition with abig enough grand prize —$500,000 — to attract the atten-tion of venture capitalists fromaround the country and providethe winner with enough capital,$500,000, to make a difference.

“We would not be around if itwere not for the Accelerate Michi-gan money we won,” said KaylanHandique, the president and CEOof Ann Arbor-based DDeeNNoovvoo SSccii--eenncceess IInncc.., which won the grandprize in 2011 for its medical devicefor early-stage cancer detection.

Since then, DeNovo has raisedmore than $7 million, including$1.3 million last month, and isplanning for a big equity raisenext year. “We wouldn’t have gotany of that money without the at-tention we got from AccelerateMichigan,” he said.

Danny Ellis, president andCEO of SSkkyySSppeeccss IInncc.., Ann Arbor,said: “If we had not won Acceler-ate Michigan last year, there’s agood chance we would eitherhave moved the company to an-other state or gone out of busi-ness.” The company’s drones doinfrastructure inspection, andearlier this month it closed on afunding round of $3 million.

This year, Accelerate Michigansurveyed semifinalists for the first

five years of the event. The 119 re-spondents said they went on toraise more than $550 million infunding following their exposureat the event.

Here are some of them:� Plymouth Township-based

PPrrooNNAAii TThheerraappeeuuttiiccss IInncc.. was asemifinalist in 2010, then a strug-gling drug-development compa-ny kept afloat by a series of smallangel investments. In 2014,ProNAi raised a venture capitalround of $59.5 million, the largestin state history, and in July thisyear had an initial public offeringof $158 million.

� Ann Arbor-based LLLLaammaassooffttIInncc.., a maker of supply chain soft-ware, won $25,000 as a sectorwinner in 2011, raised a VC roundof $6 million in 2012 and in Octo-ber got an investment of $50 mil-lion from New York-based GGoolldd--mmaann,, SSaacchhss && CCoo.., the largest VCround for an IT company in statehistory.

� Ann Arbor-based CCoommppeennddiiaaBBiioosscciieennccee was a semifinalist in2010. It later raised $5.7 millionand in 2012 was sold for $50 mil-lion.

� VVeessttaarroonn CCoorrpp.., a biotech inKalamazoo, was a semifinalist in2010. It has raised $14 million inventure capital since.

� AAllggaall SScciieennttiiffiicc CCoorrpp.. of Ply-mouth Township won first placein 2012 for its technology, whichgrows algae as an antibiotic-freefood for farm animals. Algal hassince gone on to raise $10 mil-lion, most of that from out-of-state investors.

Tom Henderson

ACCELERATEFROM PAGE 3

The following business filed forprotection in UU..SS.. BBaannkkrruuppttccyy CCoouurrttin Detroit NNoovv.. 1133--1199. Under Chap-ter 11, a company files for reorga-nization. Chapter 7 involves totalliquidation.

AAssssuurriittyy IInnssuurraannccee AAggeennccyy II LLLLCC,1908 Woodside Circle, CommerceTownship, voluntary Chapter 7.Assets: $20,000; liabilities: $52,000.

NNaattaalliiee BBrrooddaa

BANKRUPTCIES

LON HORWEDEL

Mina Sooch is CEO of ProNAi Therapeutics, an Accelerate Michigan semifinal-ist in 2010; it had an initial public offering of $158 million in July.



keting the 350,000-square-footbuilding as one of the few remain-ing downtown where you can findcontiguous space totaling 50,000square feet or more.

“Nothing like it in the CBD,”DeBono said. “One of the main fo-cuses will be ownership reinvestingin the building and actively workingto upgrade the building class overall.”

Along with adding at least onenew restaurant to the city’s growingroster, all this is to bring the pre-De-pression era building — completewith its nearly windowless westernside — into the 21st century after atumultuous ownership history,planned developments next doorthat went bust, and years of vyingfor the attention its flashier compa-triots receive.

‘A complete overhaul’Walking into Cadillac Tower

today, you’d be surprised to learn,with its exposed pipes and unfin-ished walls, that renovations to thetwo-story lobby are nearly completeafter about six months of work.

Among the improvements arenew granite, an updated entryway,new business directories in the lobby,a pair of new restrooms, new tile, wallfinishes, and lighting.

Southfield-based HHuunnttiinnggttoonn CCoonn--ssttrruuccttiioonn CCoo.. is construction manager,and Detroit-based NNeeuummaannnn//SSmmiitthhAArrcchhiitteeccttuurree is the project architect.

Perhaps the most striking, how-ever, is what will surround a pair ofelevators that would go up to thepossible hotel space on the thirdthrough 11th floors. Designed byNeumann/Smith and manufac-tured by Livonia-based QQuuaalliittyy MMeett--aallccrraafftt IInncc.., the plan calls for a two-story wall made of laser-cut metalpanels featuring Detroit neighbor-

hoods and streets that together willcompose a skyline of the city, saidJaimelyn Neher, a Neumann/Smithdesigner. Street names will protrudefrom the panels to add texture.

“It’s a complete overhaul. We aretaking something that was manygenerations (old) and making it first-generation,” DeBono said.

Once the lobby renovations arecomplete, efforts to lease the ap-proximately 180,000 square feet ofavailable office space will begin.

“We were kind of handcuffed” byDetroit’s lease, DeBono said. “Wedidn’t have much space in our arse-nal to go out and lease, and now wehave a big chunk, and we are re-thinking the building.”

Current main tenants are the DDee--ttrrooiitt PPuubblliicc LLiigghhttiinngg AAuutthhoorriittyy; thehuman services nonprofit TTrraavveelleerrssAAiidd SSoocciieettyy DDeettrrooiitt; RReexx WWoorrllddwwiiddee;and Toledo-based MMaannnniikk && SSmmiitthhGGrroouupp IInncc.. If all goes well for CapitalAlliance and Farbman Group, ex-pect that roster to grow.

“There are not a lot of large blocksfor users downtown that are lookingto potentially move,” said Jim Berke-meier, vice president in the South-field office of AAddvvooccaattee CCoommmmeerrcciiaallRReeaall EEssttaattee AAddvviissoorrss.

Among those with 20,000 squarefeet of contiguous space availableare the buildings at 211 W. Fort St.;the FFoorrdd BBuuiillddiinngg at 615 Griswold St.;the MMaarrqquueettttee BBuuiillddiinngg at 243 W. Con-gress St.; and the MMaaddiissoonn OOffffiiccee

BBuuiillddiinngg, formerly PPrriicceewwaatteerrhhoouusseeCCooooppeerrss LLPP, at 1900 St. Antoine St.,said Steve Morris, principal of Farm-ington Hills-based AAxxiiss AAddvviissoorrss LLLLCC.

A dearth of neighborsCadillac Tower, built in 1927 by

John Barlum, in recent years hashad a troubled relationship history,full of would-be suitors who neverturned out to be long-term relation-ship material.

In 2003, it was purchased by NewYork City-based NNoorrtthheerrnn GGrroouupp IInncc..for $15.4 million. Then six years ago,the company lost control of CadillacTower under order from a federaljudge after a $17.5 million loan onthe building went into default, anda financial overseer from FarbmanGroup was appointed, Crain’s re-ported at the time.

Cadillac Tower was just one offive buildings Northern Groupbought between 2003 and 2007 andlet slip into foreclosure. In all, $95million in unpaid loans were left be-hind.

And then there have been theprospective Cadillac Tower neigh-bors that never materialized.

Northern Group announced theCCaaddiillllaacc CCeennttrree development, a $150million entertainment and apart-ment complex on the Monroe Block,in January 2008 to fanfare. The devel-opment was expected to include 84apartments, a cinema, a health club,22,000 square feet of space for small-

er boutique retail and a 100,000-square-foot space for a larger retailer.

But those plans were announcedjust two weeks before the text-mes-sage scandal that eventually broughtdown then-Detroit Mayor KwameKilpatrick, one of the project’s chiefproponents. In October 2008, thedeal went dead after NorthernGroup changed plans and a keydeadline was missed.

Fast-forward to 2013, when De-troit-based MMeerriiddiiaann HHeeaalltthh unveiledplans to build a $111 million, 16-story skyscraper on the MonroeBlock, next to Cadillac Tower andbounded by Monroe, Farmer andBates streets, Woodward and Cadil-lac Square east of the former CCoomm--ppuuwwaarree CCoorrpp.. headquarters building.

But plans for that 320,000-square-foot building were scuttled last yeardue to changing economic factorsand the cost of new constructionversus leasing. Instead of building anew headquarters next to CadillacTower, Meridian opted to jointly pur-chase the 1.1 million-square-footCompuware building with DanGilbert’s BBeeddrroocckk RReeaall EEssttaattee SSeerrvviicceessLLLLCC for $142 million last year.

As part of an agreement five yearsago to bring QQuuiicckkeenn LLooaannss IInncc.. down-town from the suburbs, Gilbert’sRRoosskkoo DDeevveellooppmmeenntt CCoo.. LLLLCC, registeredto one of his closest confidants, hasdevelopment rights for the MonroeBlock with the DDoowwnnttoowwnn DDeevveelloopp--mmeenntt AAuutthhoorriittyy, owner of the property.

When Meridian approached theDDeettrrooiitt EEccoonnoommiicc GGrroowwtthh CCoorrpp.., whichstaffs the DDA, Rosko’s developmentrights were suspended until the newdevelopment plans collapsed lastyear. Then the rights reverted back toRosko, which has to submit a devel-opment plan next year.

So for the time being, CadillacTower is in search of a neighbor.

Lower rent, high upsideThe building does face challenges

for leasing such as small floors ofabout 10,000 square feet and nolandlord-owned parking, Morris andother brokers said.

But still, they said Capital Investis wise to spend millions on thebuilding to bring it up to speed.

“It offers an alternative to the rentsthat are going up around it,” Morrissaid. “The trend is that rents continueto go up north of $20 (per squarefoot). But this building can competeand make good money at under $20.”

Rents at some of the buildingsaround Campus Martius start at $21or $22 per square foot. Asking rent atCadillac Tower is about $16.50 persquare foot currently, DeBono said.

But “rates are likely to only creepupward on the office side as morerenovations are completed at thebuilding,” DeBono said.

DeBono said tenant parking ismuch easier on the east side ofWoodward Avenue than the west,and that many current tenants in the30 percent occupied building “don’thave problems finding parkingspaces just a few blocks east.”

Regardless, the building im-provements and possible redevel-opment of some of its space arewelcome news, said Danny Sam-son, chief development officer ofDetroit-based SStteerrlliinngg GGrroouupp.

“It’s a good plan and it’s a longtime in the making,” he said. �

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

During the same period in 2014,Henry Ford recorded net income of$15.4 million on revenue of $3.46billion, for a 0.4 percent margin.

So far this year, HAP Midwest hasposted $20 million in profit and hascontributed more than $70 millionin income to Henry Ford since itwas acquired in 2011. Projected rev-enue this year is $500 million.

Lassiter said Henry Ford plans toclose on the acquisition of Flint-based HHeeaalltthhPPlluuss ooff MMiicchhiiggaann laterthis year, which would add $410 mil-lion in projected annual revenue.

Early next year, Henry Ford plansto merge with Jackson-based AAllllee--ggiiaannccee HHeeaalltthh and add a projected$500 million in annual revenue. Thesystem also plans to build a $110 mil-lion outpatient cancer center in De-troit near HHeennrryy FFoorrdd HHoossppiittaall, he said.

Despite the expected $500 mil-lion annual revenue hit from HAPMidwest, Henry Ford officials proj-ect it will grow into a $5.5 billionhealth company by mid-2016.

Lassiter said multiple healthplans have signaled interest in buy-ing HAP Midwest’s Medicaid busi-

ness, but he said the system couldnot disclose the names because ofconfidentiality agreements.

However, six Medicaid HMOshave been approved for Region 9and eight for Region 10. Region 9 in-cludes the counties of Washtenaw,Livingston, Jackson, Hillsdale,Lenawee and Monroe, and Region10 is Wayne, Oakland and Macomb.

Plans serving both regions areAAeettnnaa BBeetttteerr HHeeaalltthh ooff MMiicchhiiggaann, BBlluueeCCrroossss CCoommpplleettee ooff MMiicchhiiggaann, MMccLLaarreennHHeeaalltthh PPllaann, MMeerriiddiiaann HHeeaalltthh PPllaann ooffMMiicchhiiggaann, MMoolliinnaa HHeeaalltthhccaarree ooff MMiicchhiiggaannand UUnniitteeddHHeeaalltthhccaarree CCoommmmuunniittyy PPllaann.

A lawsuit is still being contemplat-ed to reinstate HAP Midwest to re-gions 9 and 10, Lassiter said, but op-tions are limited because Medicaidmembers need to be contacted thisweek about changes in health plans.

“The state’s process handcuffsus,” he said. “If we don’t affirmative-ly take steps to transfer members, itwill be done for us” by the state.

Therefore, Lassiter said thesmoothest transition would be forHenry Ford to sell those regions’membership to a single health plan.

A membership transfer would sat-isfy two goals, he said. First, it wouldensure continuity of care for HAP

Midwest members. Second, it wouldgenerate a return on investmentfrom HAP Midwest, Lassiter said.

Ed Chadwick, Henry Ford’s CFO,said the substantial income HAPMidwest generated for the nonprof-it system over the years has helpedto cover losses incurred by HenryFord’s physicians and hospitals fortreating the Medicaid patients.

“The state has not provided rateincreases for 14 years,” Chadwicksaid. “Providers (physicians andhospitals) are generally underpaidby Medicaid and people losemoney” providing Medicaid care.

Chadwick said state officialsmade a grave mistake in not re-warding integrated systems likeHenry Ford and Lansing-basedSSppaarrrrooww HHeeaalltthh SSyysstteemm, which alsohad its HMO ejected from the Med-icaid program, for providing effi-cient and coordinated care for morethan 110,000 combined patients.

“We are a leader in the nation, andthis process just killed that,” Chad-wick said. “There are economic con-sequences to Ford, and it makes itharder for us to provide care on inte-grated basis going forward.”

One result from the contract losscould be layoffs of some of the 150

employees at HAP Midwest, saidJim Connelly, CEO of HHeeaalltthh AAlllliiaanncceePPllaann ooff MMiicchhiiggaann, which overseesHAP Midwest.

“There are severe implicationsfor employment levels. We werestripped of 90 percent of our Medic-aid business,” said Connelly,adding: “We are working throughthat (job needs) assessment.”

Late last week, Susan Schwandt,a HAP spokesperson, said between“50 to 100 HAP Midwest HealthPlan jobs are being evaluated for re-deployment throughout” the HenryFord system. It was not known howmany jobs HAP Midwest wouldneed to administer the only territo-ry it would still have, Region 6 inmid-Michigan and the Thumb.

With only 1,000 members left forHAP Midwest in St. Clair County,Connelly said adjustments need tobe made to be ready to accept newmembers Jan. 1.

Region 6 includes St. Clair,Lapeer, Genesee, Shiawassee, Sani-lac, Tuscola and Huron counties.

Another result will be the loss ofcontinuity for many HAP Midwestmembers, the majority of whom areArab-Americans, Hispanic andAfrican-Americans, Connelly said.

“Hassan Jaber (executive director ofAACCCCEESSSS) spoke eloquently” at lastweek’s hearing before the state admin-istrative board, Connelly said. “Themajority of his constituency used HAPMidwest for decades. Many are immi-grants and have language and culturaldifficulties that could disrupt theircare.” with another plan.

ACCESS is a Dearborn-basedArab-American community organi-zation with 70,000 members.

Because of the dense populationin Southeast Michigan, however,many physicians contract with mul-tiple Medicaid health plans, includ-ing physicians employed by the HHeennrryyFFoorrdd MMeeddiiccaall GGrroouupp, sources said.

Besides HAP Midwest, anotherbig loser in the contract wars was21,000-member Sparrow PHP, whichlost Region 7 and includes the coun-ties of Ingham, Clinton and Eaton.

Dennis Reese, CEO of PPhhyyssiicciiaannssHHeeaalltthh PPllaann and Sparrow PHP, saidthe company also is considering thelegal avenue. If that fails, PHP hasmade arrangements to transfermembers to another plan. Physi-cians Health Plan is a commercialplan with 60,000 members. �

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

HAPFROM PAGE 1

CADILLACFROM PAGE 1

KIRK PINHO

The two-story lobby at Cadillac Tower is still under construction after about six months of work.



vestments with, in some cases,friends, acquaintances and busi-nesspeople who lavished boardmembers with cash, gifts and freetrips to the Caribbean.

The Detroit pension funds,meanwhile, continue to dump indi-vidual real estate investments.Some real estate deals were tied upin the corruption scandal, whileothers were bad investments, likethe Westin Book Cadillac Detroithotel, pension officials said.

“There’s still garbage in the portfo-lio that needs to be cleaned up, andwe’re working hard on that,” said RyanBigelow, the funds’ investment officer.“The Book Cadillac was a dog.”

By the end of November, the PPoolliicceeaanndd FFiirree RReettiirreemmeenntt SSyysstteemm pensionfund could hire two firms to managea $150 million investment in globallow-volatility stocks, Bigelow said.The investment represents 5 percentof the $3 billion pension fund.

The strategy is aimed at protect-ing against the kind of losses seenduring the 2008 global financial cri-sis, Bigelow said.

“Low-volatility stocks don’t al-ways lead to the highest return, butit does provide a little protectionwhen the markets are really frothyor when there is significant down-ward pressure,” he said.

The stock strategy also couldhelp the fund reach its assumed an-nual investment return of 6.75 per-cent, he added. The return targetwas set by the two pension fundsduring the city’s bankruptcy case.

The Police and Fire fund’s invest-ments are being overseen by a nine-member board led by Robert Smith,chairman and CEO of SSppeerroo--SSmmiitthhIInnvveessttmmeenntt AAddvviisseerrss IInncc.. of Cleveland.

Smith is among five members ap-pointed by the state as part of thebankruptcy case. He is helping over-see a pension fund that has survivedbankruptcy and corruption that in-volved paying pension officials bribesand kickbacks and, in return, receiv-ing millions from the funds.

“One great benefit of a crisis isthat there is a sense among the peo-ple who are in charge now about‘never again,’ ” Smith said.

The city’s GGeenneerraall RReettiirreemmeenntt SSyyss--tteemm pension fund, meanwhile,could hire multiple firms to oversee

the fund’s fixed-income portfolioearly next year as part of a broaderrestructuring. The number of firmsis undetermined, Bigelow said.

The selection process will beoverseen by a seven-member in-vestment committee headed byKen Whipple, retired chairman andCEO of CCMMSS EEnneerrggyy CCoorrpp.

The pending investments andoversight are wise moves, said EricScorsone, a MMiicchhiiggaann SSttaattee UUnniivveerrssiittyyeconomist.

“They will protect the retirementincome of folks who earned thesebenefits and protect the city fromany financial burden,” he said.

Both committees are dominatedby members with professional in-vestment experience who can pro-vide a layer of oversight and skill,Whipple said.

The committees also shouldeliminate the chance politicallyconnected or bribe-paying busi-nesspeople could obtain multimil-lion-dollar deals from the pensionfunds, officials said.

“That is absolutely out of thequestion,” said Mark Diaz, presi-dent of the DDeettrrooiitt PPoolliiccee OOffffiicceerrss AAss--ssoocciiaattiioonn. Diaz sits on the Police and

Fire pension fund board and its in-vestment committee.

“The idea of someone bringing ina friend to the table, that’s not hap-pening,” Diaz said.

Both pension funds, meanwhile,are shifting away from individualreal estate investments and areshedding properties when possible.

In the future, the city retirementsystems are more likely to partici-pate in a commingled real estatefund with other investors.

“It’s a risk thing,” Whipple said. “Ifa single hotel goes down, pensionersaren’t going to take a hit. The fundmanager could invest in 100 BookCadillac hotels and spread the risk.”

Both pension funds were in-volved in a complex 2006 financingtransaction that renovated the BookCadillac Hotel.

The GRS pension fund loaned $9million toward the Book Cadillacproject, while the Police and Firepension fund backed a $15 millionloan from FFiirrsstt IInnddeeppeennddeennccee BBaannkk.

The investments are tied up in alawsuit that alleges a secretivescheme bumped the CCaarrppeenntteerrss PPeenn--ssiioonn TTrruusstt FFuunndd ahead of other in-vestors, including the pension funds.

“The Book Cadillac is going to bereasonably successful financiallyand a good thing for the city, butthings like that are way too high-risk,” Whipple said. “That’s a thingthat the pension funds don’t haveany business investing in.”

The pension funds have been un-loading property in recent months.

In March, Dan Gilbert purchasedthe 1 million-square-foot One De-troit Center building downtown for$100 million. The Detroit Police andFire Retirement System fund owneda 10 percent stake in the buildingand parking deck.

That investment previously washandled by MMaayyffiieellddGGeennttrryy RReeaallttyy AAdd--vviissoorrss LLLLCC, a firm owned byChauncey Mayfield. He was sen-tenced in October to three years’probation after being convicted inthe pension fund corruption case.

He was among six pension fundofficials and businessmen foundguilty of crimes following a corrup-tion trial last year.

Mayfield’s firm was replaced, butincomplete records have made itdifficult, if not impossible, for thepension fund to assess investmentsmade years earlier.

PENSIONSFROM PAGE 1

Campbell Ewald also now does work such as app develop-ment, interactive design, and list and data management as partof its holistic approach to managing a client and its customers.

Part of the strategy is to eliminate as much ad fraud — on-line content being clicked on by computer “bots” rather thanreal people is a hot topic in the ad industry — as possible.

The change in how it does business has been necessary forCampbell Ewald to stave off further bad news.

Over the past several years, Campbell Ewald has suffered astring of high-profile account losses: GGeenneerraall MMoottoorrss strippedthe massive Chevrolet account away in 2010 after 91 years withthe agency, and then the UU..SS.. PPoossttaall SSeerrvviiccee went elsewhere aftera decade. Last year, the $280 million Cadillac account was lost.

“We’ve had some really challenging days,” Palmer, 57, said.Because of the economy and the vagaries of the advertising

world, a handful of smaller clients also jumped agencies, andheadcount at Campbell Ewald fell from more than 1,200 adecade ago to about 500 today.

Revenue also slumped, dropping nearly 53 percent from ahigh of $239.2 million in 2007 to $113.4 million last year, ac-cording to yearly estimates from Advertising Age. CampbellEwald is the 94th-largest U.S. advertising shop by revenue.

Palmer, a 24-year veteran of the agency who became CEOin 2013, declined to comment on specific financial data, butdid say CE isn’t in the red.

“This has always been a profitable agency,” he said.The agency’s corporate owner, New York City-based ad

holding firm IInntteerrppuubblliicc GGrroouupp ooff CCooss.., doesn’t disclose individ-ual agency revenue.

Making matters worse, the UU..SS.. NNaavvyy announced earlier thisyear it would transition its $457 million recruiting marketingaccount, which has been with Campbell Ewald for 15 years, toNew York City-based rival YYoouunngg && RRuubbiiccaamm IInncc..

Anchors going away?The Navy account is one of CE’s largest, along with KKaaiisseerr

PPeerrmmaanneennttee and UUSSAAAA, and the agency responded with a seriesof appeals and court actions to keep the work. It’s accusing theNavy of unfair treatment in the procurement process.

Palmer said a hearing on the matter in the UU..SS.. CCoouurrtt ooff FFeedd--eerraall CCllaaiimmss will happen in December or January.

“We’re going to make a strong case that we followed theprocurement to the letter,” he said.

The loss of the Navy account, which Campbell Ewald contin-ues to work on during the appeals process, won’t be catastrophicfor the agency. At worst, fewer than two dozen jobs could be lost— or none at all if the agency continues to pick up new work.

“We don’t fear that like we did,” Palmer said.The agency is better positioned now to absorb the loss than

it was six months ago, thanks to its new client mapping systemand new accounts. And if the Navy does end up with Y&R,Campbell Ewald will pursue the UU..SS.. AArrmmyy’s recruiting work thatwill be up for grabs in the next couple of years, Palmer said.

New York City-based MMccCCaannnn WWoorrlldd GGrroouupp IInncc.. in April got aone-year, $200 million contract to handle the Army’s recruit-ing marketing.

It will be a new-look Campbell Ewald that pitches for thework.

Mapping a strategyPalmer credits the client/customer mapping system and

the philosophy around it for the agency’s rebound. The map — a literal, massive paper on a table or mounted

on a wall, but also used digitally on tablets and phones — is avisual representation of a customer decision-making cycle fora particular client, along with vertical categories for theagency’s handling of aspects of the cycle. CE managementtermed it a playbook for clients and the agency.

It includes the processes and tools available for the client andagency to affect different parts of how the client’s customers in-teract with a product or service. It uses real-time analytics tomeasure effectiveness and react to problems. It also does data-based market predictions.

“The less guessing you do, the better,” said Palmer, whocalled the timing of the development of the client mappingsystem “serendipity” for the agency’s renaissance.

For example, the agency last week had a map spread on aconference room wall showing how people in California makedecisions to opt into, or not opt into, the state’s federally man-dated health insurance exchange, CCoovveerreedd CCaalliiffoorrnniiaa.

The map illustrated why a Californian may choose to buyinsurance, such as because of sickness or injury, and it showedthe lifecycle of that person’s involvement with Covered Califor-nia and how marketing affected things along that timeline.

The intent is to illustrate opportunities to bolster advertis-ing at weak points, where messaging is working, and what sortof marketing works best.

CE has created 50 such maps, 13 of them for USAA.One of the key figures in retooling the agency around the

processes is Kevin Wertz, one of several management promo-tions and new hires by Palmer as part of his reinvention strategy.

Last year, Palmer promoted Wertz, 42, to president of theDetroit, Los Angeles and San Antonio offices. The New York of-fice has its own president.

Wertz joined the agency in 2007 and led the opening of theTexas office in 2009 and the successful pitch of the USAA ac-count serviced there.

Palmer and Wertz credit the mapping for helping it win abatch of new clients: In June, CE picked up the advertising ac-count for Detroit-based HHeennrryy FFoorrdd HHeeaalltthh SSyysstteemm, and it won athree-year, $150 million contract to market Covered California.

It also recently picked up work for Minneapolis-based hotel

chain CCoouunnttrryy IInnnnss && SSuuiitteess bbyy CCaarrllssoonn, online travel agencyTTrraavveelloocciittyy, and EEmmppiirree SSttaattee DDeevveellooppmmeenntt CCoorrpp.., New YorkState’s chief economic development agency. The last is a two-year deal worth $150 million with a pair of one-year options.

Major current Campbell Ewald clients include the DDeettrrooiittLLiioonnss, TThhee DDiissttrriicctt DDeettrrooiitt, DDooww CChheemmiiccaall CCoo.., MMoottoorrCCiittyy CCaassiinnooHHootteell, AAttkkiinnss NNuuttrriittiioonnaallss IInncc.., LLiiffeeLLoocckk IInncc.., SSnnuuggggllee, EEddwwaarrdd JJoonneess,CCoouunnttrryy CCrroocckk and CCaarroolliinnaass HHeeaalltthhCCaarree SSyysstteemm.

CE continues to do some General Motors work, such as theglossy Cadillac magazine and OOnnSSttaarr.

The agency is finalizing a national agency-of-record relation-ship with a major firm that Palmer said he cannot yet disclose.

The new work and philosophical changes have improvedagency morale, too.

“We’re back on a growing trajectory,” Wertz said.

Staffing changesIn addition to development of the mapping system and

philosophy in how it handles clients, Palmer said, the agencyis in the process of re-staffing. It spent $15 million to move intofive floors of the office warehouse attached to Ford Field inJanuary 2014. It had been in Warren since the late 1970s.

While Palmer expects headcount to remain the same, theagency will adjust its mix of jobs to meet the needs of its map-ping strategy for clients.

“This has been the basis for reinvention of our staff,” hesaid.

That staff has to create advertising messaging, branding, con-tent, campaigns (and the agency has to bid the right price), for themapping system and philosophical changes to have any value.

“This, with good ideas, is really powerful. With bad ideas, it’sjust a map,” said Palmer.

New leadership is charged with making sure the agency thatcoined iconic taglines such as “See the USA in Your Chevrolet”develops creative content that meets client needs.

For example, Jo Shoesmith was hired in August away fromLLeeoo BBuurrnneetttt CChhiiccaaggoo as executive creative director based in LosAngeles, and Zenaida Torres was added as group account di-rector from DDDDBB CCaalliiffoorrnniiaa.

Palmer this month hired Wojtek Szumowski away from CCrriissppiinnPPoorrtteerr++BBoogguusskkyy to be the agency’s director of invention strategy.

His job is not only to oversee the creative strategy depart-ments across all four offices but also to quarterback CE’s “In-vention Strategy,” aimed at inspiring “invention of new formsof storytelling and new emotional links between people,brands, technology and culture.”

One business strategy that dates back to the agency’s 1911founding by Frank Campbell and Henry Ewald continues towork: Being a one-stop shop.

“We built this all under one roof to serve clients,” Wertz said.“We’ve always been built as an integrated agency.” �

Bill Shea: (313) 446-1626Twitter: @Bill_Shea19

AGENCYFROM PAGE 1


eries are closed, Achatz stays openon Thanksgiving Day until 2 p.m.Many grocery stores are open, too.

“We’re gracing a lot of tables atThanksgiving. That’s pretty spe-cial,” said Mike Busley, co-ownerof Grand Traverse Pie Co. Insteadof selling 150 pies a day, its Tra-verse City restaurant will send2,000 pies out on Wednesday, heestimated.

Thanksgiving week accounts forabout 7 percent of the 700,000 piesGrand Traverse sells annually in all15 outlets, wholesale and online.

Grand Traverse is seeing stronggrowth in pies as gifts, Busley said.Many go to family or friends orbusinesses that want to show ap-preciation to their clients. One re-cently purchased 150 custom pieswith “thank you” cut into the topcrust, he said.

Starting earlyAt LLoovvee’’ss CCuussttaarrdd PPiiee, which bakes

and sells at Eastern Market in De-troit, the orders started in October.Donnie Love, co-owner with herhusband, Allen, keeps a running listof customer requests.

“The last few days, you get a lot ofcalls,” said Allen Love, estimatingthat the couple will bake close to100 pies for Thanksgiving, morethan double the normal weeklysales.

Pie preparation starts right afterthe Fourth of July at ChesterfieldTownship-based Achatz, when itsbakers commence creating rawfrozen pies. They are stored in alocal deep freeze, then are shippedto grocery store customers out ofstate in the fall. Its frozen, ready-to-bake line goes out by the semi-truckloads to Canada and grocers inthe Mid-Atlantic states.

Starting in September, bothAchatz and Grand Traverse Pie ex-ecutives start estimating out howmany apples and how muchcanned pumpkin, sugar and flour tobuy. “We pre-buy all that and get itin house” said Tim Rice, a GrandTraverse Pie vice president.

Pie is a seasonal dish with region-al flavor preferences. Banana creamand pumpkin are popular in Texas,and pecan is a favorite in the south,said Robin Henley, a consultantwith SSyynneerrggyy RReessttaauurraanntt CCoonnssuullttaannttss,based in San Antonio. For restau-rants that bake them in-house,“there’s good profitability,” she said,better than cheesecake.

The favorite flavor this time of

year, of course, is pumpkin or sweetpotato, but others sell well, too. AtZingerman’s, apple wins runner-uppopularity and cranberry walnut isthe most unusual.

“Some people are not quite surewhat it is,” said Whipple, who notedthat it uses the same brown sugarand vanilla filling as pecan and yetthe cranberries give it a tart flavor,too.

At Achatz, “most everybody getsour signature” Michigan four-berry,Wendy Achatz said. And at GrandTraverse, pecan pie is the second-most popular choice for Thanksgiv-ing dinner.

Because of the big bump inbusiness, pie companies hire plen-ty of seasonal help. At Achatz, for-mer staffers and managers returnto its stores, including one womanwho’s eight months pregnant andwill sit on a stool and run the cashregister for a few days, WendyAchatz said.

After some unfavorable experi-ences with temporary workers, thebakery crew said, “We’ll all workOT, we’ll all work 65 hours a weekto get it done,” she said.

Yet the addition of new whole-sale clients, including one grocerychain that’s already reorderedpecan pies, mean the companydid hire about 20 temps to supple-ment the 60 year-round bakerystaffers.

Wendy Achatz still helps out inthe kitchen at the company startedin 1993 that has grown to morethan $10 million in revenue. Butshe noted that, at 51, she feels theeffort in her back and knees.

“I was only pressing shells foreight hours. I used to be able to do16 hours,” she said.

Daylong effortIn October, Zingerman’s Bake-

house, which has about $10 millionin annual revenue, brings on closeto 30 temporary staffers, a 23 per-

cent boost. They work through theend of December baking pies, thencookies and cakes for Christmasholidays.

The crew prepares pie shellsahead, using a “pie stamper” — amechanized device that removesthe need for a rolling pin andshapes the dough to the pie plate.The pie shells are stacked andfrozen, ready to be filled with freshapple or pumpkin pie filling thisweek.

“People are making pies all daylong, filling and baking, filling andbaking,” Whipple said. “We do ourbest not to run out.”

One idea, though, did run itscourse quickly. Zingerman’s Bake-house created a Thanksgiving cakefor a couple of years, decorated withfondant and a cute, googly eyedturkey on top.

“We sold a few but not verymany,” said Whipple, so the cakewas discontinued. “They wantpie.” �


www.crainsdetroit.com

EEddiittoorr--iinn--CChhiieeff Keith E. CrainGGrroouupp PPuubblliisshheerr Mary Kramer,(313) 446-0399 or [email protected] PPuubblliisshheerr Marla Wise, (313) 446-6032or [email protected] Jennette Smith, (313) 446-1622 [email protected] EEddiittoorr Cindy Goodaker, (313) 446-0460or [email protected],, DDiiggiittaall SSttrraatteeggyy,, AAuuddiieennccee DDeevveellooppmmeennttNancy Hanus,(313) 446-1621 or [email protected] MMaannaaggiinngg EEddiittoorr Michael Lee, (313) 446-1630 [email protected] EEddiittoorr//CCuussttoomm aanndd SSppeecciiaall PPrroojjeeccttssDaniel Duggan, (313) 446-0414 [email protected] MMaannaaggiinngg EEddiittoorr Kristin Bull,(313) 446-1608 or [email protected] EEddiittoorr Beth Reeber Valone, (313) 446-5875 or [email protected] EEddiittoorr Gary Piatek, (313) 446-0357 or [email protected] aanndd DDaattaa EEddiittoorr Sonya Hill,(313) 446-0402or [email protected] SSuuppppoorrtt (313) 446-0419; YahNica Craw-ford, (313) 446-0329NNeewwssrroooomm (313) 446-0329, FAX (313) 446-1687 ,TIP LINE (313) 446-6766

REPORTERSJJaayy GGrreeeennee,, sseenniioorr rreeppoorrtteerr Covers health care, in-surance, energy, utilities and the environment.(313) 446-0325 or [email protected] HHaallccoomm Covers litigation, the defense indus-try and education. (313) 446-6796 [email protected] HHeennddeerrssoonn Covers banking, finance, tech-nology and biotechnology. (313) 446-0337 [email protected] PPiinnhhoo Covers real estate, Oakland and Ma-comb counties. (313) 446-0412 [email protected] SShheeaa,, eenntteerrpprriissee eeddiittoorr Covers media,advertising and marketing, the business ofsports, and transportation.(313) 446-1626 or [email protected] SSnneellll,, rreeppoorrtteerr Covers city of Detroit and regional politics. (313) 446-1654 [email protected] VVaannHHuullllee, LLaannssiinngg rreeppoorrtteerr. (517) 657-2204 or [email protected] WWaallsshh,, sseenniioorr rreeppoorrtteerr Covers the busi-ness of law, auto suppliers, manufacturing andsteel. (313) 446-6042 or [email protected] WWeellcchh,, sseenniioorr rreeppoorrtteerr Covers nonprofits,services, retail and hospitality. (313) 446-1694 or [email protected]

ADVERTISING

SSaalleess IInnqquuiirriieess (313) 446-6032; FAX (313) 393-0997SSaalleess MMaannaaggeerr Tammy Rokowski SSeenniioorr AAccccoouunntt EExxeeccuuttiivvee Matthew J. LanganAAddvveerrttiissiinngg SSaalleess Christine Galasso, CatherineGrace, Joe Miller, Sarah StachowiczCCllaassssiiffiieedd SSaalleess MMaannaaggeerr Angela Schutte, (313)446-6051CCllaassssiiffiieedd SSaalleess Lynn Calcaterra, (313) 446-6086EEvveennttss MMaannaaggeerr Kacey AndersonCCrreeaattiivvee SSeerrvviicceess DDiirreeccttoorr Pierrette TempletonSSeenniioorr AArrtt DDiirreeccttoorr Sylvia KolaskiMMaarrkkeettiinngg CCoooorrddiinnaattoorr Ariel BlackSSppeecciiaall PPrroojjeeccttss CCoooorrddiinnaattoorr Keenan CovingtonSSaalleess SSuuppppoorrtt Suzanne Janik, YahNica CrawfordEEddiittoorriiaall AAssssiissttaanntt Nancy PowersPPrroodduuccttiioonn MMaannaaggeerr Wendy KobylarzPPrroodduuccttiioonn SSuuppeerrvviissoorr Andrew Spanos

CUSTOMER SERVICE

MMaaiinn NNuummbbeerr:: Call (877) 824-9374 or [email protected] $59 one year, $98 two years. Out ofstate, $79 one year, $138 for two years. OutsideU.S.A., add $48 per year to out-of-state rate for sur-face mail. Call (313) 446-0450 or (877) 824-9374.SSiinnggllee CCooppiieess (877) 824-9374RReepprriinnttss (212) 210-0750; or Krista Bora [email protected] ffiinndd aa ddaattee aa ssttoorryy wwaass ppuubblliisshheedd (313) 446-0406 or e-mail [email protected]

CCrraaiinn’’ss DDeettrrooiitt BBuussiinneessss iiss ppuubblliisshheedd bbyy CCrraaiinn CCoommmmuunniiccaattiioonnss IInncc..CChhaaiirrmmaann Keith E. CrainPPrreessiiddeenntt Rance CrainTTrreeaassuurreerr Mary Kay CrainEExxeeccuuttiivvee VViiccee PPrreessiiddeenntt//OOppeerraattiioonnssWilliam A. MorrowEExxeeccuuttiivvee VViiccee PPrreessiiddeenntt//DDiirreeccttoorr ooff SSttrraatteeggiiccOOppeerraattiioonnss Chris CrainEExxeeccuuttiivvee VViiccee PPrreessiiddeenntt//DDiirreeccttoorr ooff CCoorrppoorraatteeOOppeerraattiioonnss KC CrainVViiccee PPrreessiiddeenntt//PPrroodduuccttiioonn && MMaannuuffaaccttuurriinnggDave KamisCChhiieeff FFiinnaanncciiaall OOffffiicceerr Thomas StevensCChhiieeff IInnffoorrmmaattiioonn OOffffiicceerr Anthony DiPonio GG..DD.. CCrraaiinn JJrr.. Founder (1885-1973)MMrrss.. GG..DD.. CCrraaiinn JJrr.. Chairman (1911-1996)EEddiittoorriiaall && BBuussiinneessss OOffffiicceess1155 Gratiot Ave., Detroit MI 48207-2732; (313) 446-6000Cable address: TWX 248-221-5122 AUTNEW DETCRAIN’S DETROITBUSINESS ISSN # 0882-1992 is pub-lished weekly,except fora special issue the third weekofNovember,and no issue the third weekofDecemberbyCrain Communications Inc.at 1155 Gratiot Ave.,DetroitMI 48207-2732.Periodicals postage paid at Detroit,MIand additional mailing offices.POSTMASTER: Send ad-dress changes to CRAIN’S DETROITBUSINESS,Circula-tion Department,P.O.Box07925,Detroit,MI 48207-9732.GST# 136760444.Printed in U.S.A.Entire contents copyright 2015 byCrain Communica-tions Inc.All rights reserved.Reproduction oruse ofedi-torial content in anymannerwithout permission isstrictly prohibited.


Achatz Handmade Pie....................................... 33Asset BIDCO........................................................ 77Bank of Ann Arbor ............................................ 1133Campbell Ewald .................................................. 11Clarkston State Bank....................................... 1122Crain Communications.................................... 2211Donnelly Penman & Partners.......................... 1111Farbman Group ................................................... 11Fifth Third Bank................................................. 1122Flagstar Bancorp ............................................... 1111Grand Traverse Pie ............................................. 33Health Alliance Plan of Michigan..................... 33Henry Ford Health System ............................... 33Huron Valley State Bank ............................ 1122,, 1144

Invest Detroit ................................................... 2222Invest Michigan ................................................ 2222Love’s Custard Pie ........................................... 2255Michigan Economic Development .................. 33Michigan Future................................................ 1100Neumann/Smith Architecture ...................... 2233New Economy Initiative for SE Michigan ... 33,, 2222Oakland University ............................................ 66Onset BIDCO ....................................................... 77Physicians Health Plan ................................... 2233PNC Financial Services.................................... 1133ProNAI Therapeutics....................................... 2222Talmer Bancorp.............................................. 77,, 1111Zingerman’s Bakehouse.................................... 33

INDEX TO COMPANIESThese companies have significant mention in this week’s Crain’s Detroit Business:

PIESFROM PAGE 3

PHOTOS BY LON HORWEDEL

Carlos Gonzales (above) adds milk to pie dough in one of the giant mixers inside Zingerman's Bakehouse in Ann Arbor last week.The bakery expects pie sales to grow 20 percent over last year. Zingerman’s uses an automated dough press (below left) but bakerscrimp the edges of the pie crust by hand.


Lions to switchradio flagshipto WJR for 2016

The DDeettrrooiitt LLiioonnss will have anew radio flagship home in2016 — WWJJRR--AAMM 776600, new

team President RRoodd WWoooodd an-nounced Friday on WJR’s “Paul W.Smith Show.”

WJR, a 50,000 watt news/talk sta-tion, is owned by Atlanta-based CCuu--mmuulluuss MMeeddiiaa IInncc.. Financial terms ofthe deal were not disclosed. TheLions’ radio rights have been withCCBBSS RRaaddiioo IInncc..-owned WWXXYYTT--FFMM 9977..11since 2004. Accusations that theLions sought to stifle criticism onWXYT emerged shortly after theformal announcement and weredenied by the team.

COMPANY NEWS� DDaann GGiillbbeerrtt, founder and chair-

man of Detroit-based QQuuiicckkeenn LLooaannssIInncc.. and RRoocckk VVeennttuurreess LLLLCC, is in talksto buy a city-owned parking garageunderneath the former HHuuddssoonn’sstore site on Woodward Avenue, ahighly desirable downtown Detroitproperty. Gilbert is willing to payabout $15 million for the 900-spacePremier Underground Garage, asource with knowledge of the nego-tiations told Crain’s.

� SSOOKK VVeennttuurree LLLLCC, an affiliate ofLivonia-based TTeeaamm SScchhoossttaakk FFaammiillyyRReessttaauurraannttss, won an auction for thebankrupt assets of Troy-based OOllggaa’’ssKKiittcchheenn IInncc.. with a $10.95 millionbid. SOK was competing with Troy-based joint venture CCoossmmoo HHoossppiittaallii--ttyy LLLLCC for the 26 Olga’s restaurants.

� DDaaiimmlleerr TTrruucckkss plans to invest$375 million to bring production ofmedium-duty engines to its RedfordTownship manufacturing facility.The company said the new produc-tion will add more than 158 jobs.

� TTrruucckk HHeerroo IInncc.., an Ann Arbor-based maker and seller of aftermar-ket parts for trucks and SUVs, can-celed a planned initial publicoffering Friday after finding that theappetite for its stock was short ofexpectations.

� About 130 employees of vinylwall graphics maker FFaatthheeaadd andfootball helmet maker XXeenniitthh LLLLCCare taking three floors in the formerKKrreessggee building at 1201 WoodwardAve. in downtown Detroit.

� AAttwwaatteerr BBrreewwiinngg CCoo.. this weekwill open a biergarten and tap-house adjacent to its Rivertownbrewery in Detroit. The 5,000-square-foot space at 237 JosephCampau includes a full-servicerestaurant. Renovations cost ap-proximately $100,000, Atwaterowner MMaarrkk RRiieetthh told Crain’s.

� The DDeettrrooiitt CCiittyy CCoouunncciill ap-proved a Renaissance Zone tax ex-emption for supplier SSaakktthhii AAuuttoommoo--ttiivvee GGrroouupp UUSSAA IInncc.. aimed atenabling a $60 million investment

on the Southwest Detroit water-front. Sakthi is expanding to pro-duce aluminum castings with anontraditional workforce of con-victed felons.

� Detroit-based DDTTEE EEnneerrggyy CCoo..said it will spend $415 million overthe next five years to replace powerpoles and add electric lines andequipment in an effort to continueimproving power reliability inSoutheast Michigan.

� Detroit-based GGeenneerraall MMoottoorrssCCoo.. and DDyykkeemmaa GGoosssseetttt PPLLLLCC andDearborn-based FFoorrdd MMoottoorr CCoo..were among seven Michigan com-panies on a list of more than 400U.S. firms to earn 100 percentscores on the HHuummaann RRiigghhttss CCaamm--ppaaiiggnn FFoouunnddaattiioonn’s 2016 CorporateEquality Index. The index surveysand grades companies’ policies to-ward lesbian, gay, bisexual andtransgender people.

� Bloomfield Hills-based PPeennsskkeeAAuuttoommoottiivvee GGrroouupp IInncc.. bought SScchhnneeii--ddeerr NNeellssoonn AAuuttoo GGrroouupp in a deal ex-pected to add four stores in NewJersey, Automotive News reported.

OTHER NEWS� Emmy award-winning re-

porter KKaarreenn DDrreeww was named an-chor of WWDDIIVV--CChhaannnneell 44’s 4 p.m.newscast, beginning Dec. 21. Shewill replace RRuutthh SSppeenncceerr, who is re-tiring from the Detroit TV station inDecember.

� Celebrity chef RRaacchhaaeell RRaayybrought her TV show and about$50,000 worth of appliances toDDoowwnnttoowwnn BBooxxiinngg GGyymm and visited

with children involved in the De-troit gym’s after-school youth pro-gram. Footage from the visit onRay’s Thanksgiving special is to air at2 p.m. Nov. 25 on WWDDIIVV--CChhaannnneell 44.

� Detroit Bike Share, the firstpublic bike share program forgreater downtown, rolled forwardwith a three-year financial commit-ment of an undisclosed amountfrom Detroit-based HHeennrryy FFoorrddHHeeaalltthh SSyysstteemm/HHeeaalltthh AAlllliiaannccee PPllaann.

� AAnntthhoonnyy TTeerrssiiggnnii, the formerCEO of what is now SStt.. JJoohhnn PPrroovvii--ddeennccee HHeeaalltthh SSyysstteemm, agreed to do-nate $1 million to SStt.. JJoohhnn HHoossppiittaallaanndd MMeeddiiccaall CCeenntteerr in Detroit to en-hance its neonatal intensive careunit and birthing center.

� The UU..SS.. GGeenneerraall SSeerrvviicceess AAddmmiinn--iissttrraattiioonn announced plans to spendnearly $75 million to renovate anoffice building at 985 Michigan Ave.in Detroit and consolidate IInntteerrnnaallRReevveennuuee SSeerrvviiccee workers in it.

� 331133 BBrraazziilliiaann JJiiuu--JJiittssuu LLLLCCopened in 1,800 square feet in theformer SS..SS.. KKrreessggee CCoorrpp. headquar-ters in Detroit.

� In a letter to Pontiac MayorDDeeiirrddrree WWaatteerrmmaann, Oakland CountyExecutive LL.. BBrrooookkss PPaatttteerrssoonn urgedWaterman to stop accepting Syrianrefugees because of security risks.

� The DDeettrrooiitt SSyymmpphhoonnyy OOrrcchheessttrraawas set to debut “Symphony in D,”a compilation of city sounds cho-sen from more than 100 hours ofaudio and some 15,000 sound clipssubmitted by Detroiters.

� Dearborn physician HHiicchhaamm EEll--hhoorrrr, owner and president of HHoouusseeCCaallllss PPhhyyssiicciiaannss PPLLLLCC, must serve sixyears in federal prison and pay morethan $2 million in restitution forrunning a Medicare fraud schemethrough his practice. He was sen-tenced on a charge of conspiracy tocommit health care fraud.

OBITUARIES� SSaannddyy EEiilleerr, co-founder and

president of Ann Arbor-based EEiilleerrCCoommmmuunniiccaattiioonnss, died Nov. 18 frominjuries suffered in a car crash. Shewas 73.

� MMaarrkk MMuurrvvaayy, founder and for-mer owner of Warren-based cuttingtools and fasteners supplier MM..AA..MMuurrvvaayy IInncc.. (now MM..AA.. MMuurrvvaayy LLLLCC),died Nov. 13. He was 76. �

Toonnyyaa AAlllleenn, president andCEO of the Detroit-basedSSkkiillllmmaann FFoouunnddaattiioonn, won’t

perpetuate the blame game law-makers accused her of playing lastweek when she said the stateshould not count on foundationfunds for DDeettrrooiitt PPuubblliicc SScchhoooollss debt.

Allen also co-chairs the CCooaalliittiioonnffoorr tthhee FFuuttuurree ooffDDeettrrooiitt SScchhooooll--cchhiillddrreenn, whichhosted a round-table on theschool district’seducationallandscape lastweek, and saidfoundationsweren’t inclinedto invest in retir-

ing district debt that had built upunder state oversight.

Some lawmakers then accusedthe coalition of playing a blamegame, and focusing on handouts orpolitics rather than schoolchildren.

“I don’t think that’s worthy of(another) comment,” Allen said Fri-day. “We are all working hard ontough issues and need to be spend-ing our time on addressing theneeds of Detroit schoolchildren.”

House Speaker KKeevviinn CCootttteerr, R-Mt. Pleasant, said in a statementlast week that the coalition hasdone more than most to derail De-troit school reform. Gov. RRiicckk SSnnyyddeerrhas a $715 million plan to split thedistrict into two entities — one toimprove academics and another topay down $515 million in debt.

“Blaming the state for the finan-cial failures of DPS is like blaming arelief pitcher who enters the game inthe ninth inning already down 20runs ... ,” he said. “If the coalition isso hell-bent on preventing a deal toreform Detroit’s schools, they shoulddo the right thing for the kids andstand aside so the rest of us can worktogether to try to fix this.”

Rep. TTiimm KKeellllyy, R-Saginaw Town-ship, said in a separate statementthat foundations that spend mil-lions per year to help improve aca-demics may also share blame forthe district’s failures.

‘Desire,’ maybe? The MM--11 RRaaiill streetcar line official-

ly gets a name Tuesday, after DDaannGGiillbbeerrtt’s QQuuiicckkeenn LLooaannss IInncc.. boughtthe naming rights earlier this year.

Quicken is the largest single cor-porate donor to the $137 millionstreetcar project, now under con-struction and scheduled for com-pletion in early 2017. The companyincreased its capital contributionfrom $3 million to $10 million.

An announcement is coming 10a.m. Tuesday outside the formerCCoommppuuwwaarree CCoorrpp.. headquarters inCampus Martius. On hand will beQuicken President and Chief Mar-keting Officer JJaayy FFaarrnneerr; SSoommmmeerrWWooooddss, vice president of external af-fairs for M-1 Rail; and President andCEO TToonnyy MMiicchhaaeellss of TThhee PPaarraaddee CCoo.

The 3.3-mile rail loop will runalong Woodward Avenue from Con-gress Street downtown to GrandBoulevard in New Center. Organiz-ers project 5,000 to 8,000 riders daily.

Gilbert and RRooggeerr PPeennsskkee co-chairthe rail project. MMaatttt CCuulllleenn, presi-dent and CEO of Gilbert’s RRoocckk VVeenn--ttuurreess LLLLCC, is CEO of M-1 Rail.

CityLoft returns downtown SSoommeerrsseett CCoolllleeccttiioonn CCiittyyLLoofftt re-

turns this week to downtown De-troit, offering a new wine and beerbar from TToowwnnhhoouussee restaurant, andwith the wares of 30-plus retailersfor the holidays. The retail pop-upreturns for a fifth holiday season,this time in a larger venue on theground floor of BBeeddrroocckk RReeaall EEssttaatteeSSeerrvviicceess’ building at 1001 Wood-ward Ave. with several new retailers.

Somerset Collection is also mov-ing TThhee DDeettrrooiitt SShhooppppee from 1261Woodward Ave. to a new, 3,000-square-foot store at 1520 Wood-ward, clearing the way for NNiikkee IInncc..to move in and open a 22,000-square-foot community store.

New CityLoft retailers this yearinclude BBaacchhrraacchh, BBaannaannaa RReeppuubblliicc,CChhiiccoo’’ss, CCooaacchh, CCrraattee aanndd BBaarrrreell, EEiilleeeennFFiisshheerr, HHeennrrii BBeennddeell, LL’’oocccciittaannee, LLoouuiissVVuuiittttoonn, SSoommaa IInnttiimmaatteess, TTrruuee RReelliiggiioonnand VVeerraa BBrraaddlleeyy. �

Skillman CEO draws firein school debt blame game


RUMBLINGSON THE WEBWEEK NOV. 14-20

Detroit DigitsA numbers-focused look at lastweek’s headlines:

22,000The square footage of the NNiikkeeDDeettrrooiitt store to open in the springat 1261 Woodward Ave. DDaann GGiillbbeerrtt,chairman of QQuuiicckkeenn LLooaannss IInncc.. andRRoocckk VVeennttuurreess LLLLCC and owner ofthe building Nike will occupy,confirmed plans for the store viaTwitter.

$13.4 MThe total value of legacy grantsmade to 18 local nonprofits fromthe RRaallpphh CC.. WWiillssoonn JJrr.. FFoouunnddaattiioonn.The grants range from $25,000 to$2 million to fund organizationssupported by the late Wilson, whoowned the BBuuffffaalloo BBiillllss and GrossePointe Park-based RRaallpphh WWiillssoonnEEqquuiittyy FFuunndd LLLLCC.

52The number of corporate suites tobe part of the new DDeettrrooiitt RReeddWWiinnggss arena opening in 2017, all ofwhich have been sold. The corporatesuites at the new arena lease formore than $300,000 per year inincrements from seven to 10 years.

AARON ECKELS

The winners ofCrain’s annual 40 under 40 awards gathered Nov. 19 in an event at the Detroit Marriott Renaissance Center.The program honors high achievers who have made an impact as executives, managers, entrepreneurs and community leaders.

A night to celebrate

Tonya Allen: “Weare all working hard.”


Find out what happened and keep up with future plans as they unfold.

“Homecoming opened my eyes to all the amazing passion, activity and results that are rebuilding the city of Detroit. I came away thinking there is no better canvas for a young entrepreneur to make impact than what

we have going in Detroit.”NICK SHAH, Co-founder and COO, Ampush

“Detroit's foundation is rooted in innovation, and that's evident by the great people it produces. I leave this year's event extremely confident that Detroit will flourish again, and soon. I can feel the momentum continuing to build.”ANDREW MOERS, President, Ask Partner Network at Ask.com, a division of IAC

“For years, when asked about Detroit, I've replied that it's not just where your grow up, it's a heritage. Becoming connected with so many other expats, who feel the same way, will help create conscientious and thoughtful contributions to Detroit.”MICHELE VARIAN, Owner, Michele Varian

“In 25 years of participating in various events, the 2015 Detroit Homecoming made a lasting impression. The opportunity to directly see and hear about the tangible progress being made in Detroit was incredible.”BILL KOTCHER, Vice President, Superior Supply & Steel

“I was truly humbled and inspired by all of the amazing and wonderful things my fellow expats are doing and have committed to doing for the

great city of Detroit. Meeting expats from all over the globe who are not only visionaries but disrupters who are helping to foster the change taking place

has inspired me to come back and also make a diff erence.”ANDREA DESY, Broker, Douglas Elliman Real Estate “The Homecoming went above and beyond all of my expectations. I

was blown away by the enthusiasm, and the subsequent excitement of fellow expats to talk and engage aft erwards to find out synergies to work together. I am very excited for next year and bringing one of my businesses back to my hometown.”SHAWN WARD, President, Ward & Fift h Consulting

Jay Adelson, General Partner, Center Electric | Shane Battier, Co-founder, The Battier Take Charge Foundation |Martha Boudreau, EVP and Chief Marketing & Communications Off icer, AARPGwendolyn Butler, Vice Chairwoamn, Capri Capital Partners | Bradley Cooper, Managing Director, Capital Z Partners | Laurent Crenshaw, Head of Federal Public Policy, Yelp | Kerry Duggan, Associate Director for Policy, Off ice of Vice President Joe Biden | Ron Fournier, Senior Political Columnist, National Journal | George Gervin, Marketing Director, George Gervin Foundation | Elzie “LZ” Granderson, Columnist, CNN and ESPN | Deborah Hopkins, CEO, Citi Ventures | Mike Jbara, EVP of Technology and Business Processes, Warner Music Group | Randall Kaplan, Managing Member, JUMP Investors | Adriana Karaboutis, EVP of Technology and Business Solutions, Biogen | Christopher Keogh, Regiona Head of Private Wealth Managmement, Goldman Sachs | Charlene Li, Principal Analyst, Altimeter | David Maraniss, Associate Editor, Washington Post | Karen McDonald, Head of Talent Management, Zurich North America | Ann Marie Petach, Board Member, JLL & BlackRock Institutional Trust Lisa Pollina, Board of Directos, Ritchie Bros. Auctioners | John Rhea, Managing Partner, RHEAL Capital Management | Teresa Sebastian, President and CEO, The Dominion Asset Group | Actor Tom Skerritt | Michael Soenen, CEO, Soenen Capital | Lauryn Williams, Olympian and President, Lauryn Williams Inc. | Bob Woodruff , Correspondent, ABC News

SECOND ANNUAL DETROIT HOMECOMINGCrain's Detroit Business invited 170 prominent Detroit area "expats" to reconnect with their hometown, see first-hand

the reinvention taking place, and discover opportunities to reinvest in Detroit. Maybe The Detroit Homecoming was historic. But we know it was just a beginning. The “expat” Detroiters are now on a mission to make a diff erence in their hometown.

You can read about it — and see the video — at detroithomecoming.com.

DETROIT HOMECOMING 2015 BROUGHT MORE THAN 170 EXPATS BACK TO THEIR HOMETOWN TO

RECHARGE, REINVEST AND REDISCOVER THE CITY.

News, information, video and photo galleries available at DetroitHomecoming.com

ATTENDEES INCLUDED

DBpageAD_DBpageAD.qxd 11/20/2015 3:44 PM Page 1

David Girodat, BBA ’85, MSF ’92Regional President, Eastern MichiganFifth Third Bank

At Walsh College, real-world insights and practical knowledge from the conference room are taught in the classroom. That’s why many of our alumni have become respected business leaders. If you’re looking for a degree that will help you become a future business leader, turn to Walsh.

TRROOOYYYY NOVI CLINNTTOOONNN TTWP PORT HURON

REGISTRATION STARTS NOVEMBER 23 GET STARTED AT WALSHCOLLEGE.EDU/WINTER


Documents

Crain's Detroit Business