Michigan Rises in the Ranks of VC Investment
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Ford’s future- forward oce, design space, Page 3 APRIL 18-24, 2016 Michigan rises in the ranks of VC LISA SAWYER investment QLine cues investors By Tom Henderson [email protected] Real estate deals Venture capital investment in show economic Michigan is thriving, based on data from the Michigan Venture Cap- clout of mass ital Association and the National transit project Venture Capital Association. According to the quarterly By Robert Snell MoneyTree report issued Friday by [email protected] the NVCA and PricewaterhouseCoo- Real estate investors have pers LLP, based on data compiled by spent more than $1 billion ac- Thomson Reuters, 13 Michigan com- quiring properties near the QLine panies got a total of $78.5 million rail route, gobbling up buildings from venture capitalists in the first near future rail stations and in quarter of this year. That was good Highland Park in hopes the proj- for a state ranking of 14th nationally, ect will be extended northward. up from the ranking of 19th when The activity — including more 10 state companies raised $48.3 than $350 million worth of prop- million in the fourth quarter last erty acquisitions by QLine back- MICHAEL LEWIS II year. er and Quicken Loans Inc. and Rock More than $1 billion has been spent in real estate deals in the corridor that anks the QLine and beyond. Angels It was the Ventures LLC founder and Chair- fifth-best quar- man Dan Gilbert — illustrates rapid transit system, a new Am- is expected to top $3.5 billion clustered near Woodward. rising ter for state the economic impact of several trak center and the Detroit Red within a decade, M-1 Rail offi- The investment also shows Fund ready to companies in developments along the Wood- Wings arena. cials say, and include a mix of the symbiotic relationship be- start third the last 45 quar- ward Avenue corridor. Those in- All told, the economic impact 10,000 new residential units, of- hind Gilbert’s backing of the recruitment of ters, though off clude the rail line, a possible bus of transit-oriented development fices and commercial projects SEE QLINE, PAGE 19 investors, from the $144.2 Page 5. million raised in the third quarter last year. Will more natural gas ow Michigan ranked second among Midwest states in the first quarter. Illinois was well out in naturally lower cost? No front with $217.2 million in 24 deals, ranking eighth nationally. Costs of proposed pipelines burn benets Minnesota ranked 15th with $67.3 million in 11 deals, with Ohio 21st By Gary Anglebrandt sides expect approval this year, at $40.7 million in seven deals, In- [email protected] with construction following soon diana 25th at $24.4 million in three In the first half of 2017, two big after. deals and Wisconsin 38th at $1.5 natural gas pipelines are sched- How these spigots will impact million in one deal. uled to go into service, increasing customer power costs is an open “It looks as if the progression the volume of natural gas entering question, though industry officials from last year continues,” said Michigan by up to 35 percent. envision a general downward SEE VC, PAGE 21 That’s the scenario developing trend in customer bills as natural out of separate proposals, one by gas takes on a greater role in power © Entire contents copyright 2016 MARK HOUSTON the developers of Nexus, a $2 bil- generation over the next 15 years. by Crain Communications Inc. All rights reserved Backers are eager to build pipelines to lion pipeline backed by De- The idea is to connect Appala- crainsdetroit.com Vol. 32 No 16 $2 a copy. $59 a year. get Appalachian natural gas to the troit-based DTE Energy Co., and the chia, home to some of the most Midwest. other by developers of Rover, a productive natural gas fracking $4.2 billion pipeline backed by operations in the country, to Ohio, Dallas-based Energy Transfer Part- Michigan and beyond. The gas is ners LP. cheap and abundant, so much so Who pays, and how? Both plans are under review by that producers — some of them Getting a new pipeline paid for isn’t the Federal Energy Regulatory Com- with bankruptcy rumors swirling NEWSPAPER easy, or simple, but here’s how it mission, which approves interstate about them — are desperate to get happens, Page 20 pipelines. Developers on both SEE PIPELINES, PAGE 20 2 CRAIN’S DETROIT BUSINESS // APRIL 18, 2016 MICH-CELLANEOUS door public plaza and a 900-space MICHIGAN g With locations mainly in mid- parking deck, or about 300 more INSIDE size Midwestern college towns, spots than now exist at the site. The THIS ISSUE CALENDAR .........................................16 HopCat has had success as a big developer hopes to break ground on CLASSIFIED ADS ...............................17 fish in a small pond, but the beer- the first phase in early 2017. DEALS & DETAILS .............................15 bar chain now is entering big-city g Big-box grocery stores such as MARY KRAMER ..................................6 territory, the Grand Rapids Busi- Meijer can now sell beer and wine OPINION ..............................................6 ness Journal reported. Last month, at their gas station convenience OTHER VOICES ...................................9 BRIEFS HopCat’s Grand Rapids-based stores under legislation signed last PEOPLE ...............................................16 Chick-l-A could open 20 Coast Guard work turns parent company, BarFly Ventures, week by Gov. Rick Snyder, AP re- RUMBLINGS ......................................22 locations in state by 2021 Michigan Wheel faster announced the chain’s expansion ported. Snyder’s action lets gro- WEEK ON THE WEB .........................22 into Chicago, roughly a week after cery store gas stations count gro- With only two locations within At its height in the 1960s and the announcement of a HopCat cery supplies in other buildings the state’s borders — in food courts 1970s — as one of the biggest coming to Kalamazoo. Following toward meeting a booze-selling COMPANY INDEX: at Detroit Metropolitan Airport and names in the marine world, espe- an investment of $30 million from requirement. Some lawmakers SEE PAGE 21 Oakland University — Chick-l-A has cially in propeller manufacturing a Texas-based private equity firm, from rural districts and gas station only a bite-sized presence in Mich- — Grand Rapids-based Michigan BarFly owner and HopCat founder convenience store owners say it igan. Now, MLive.com reports, the Wheel Corp. saw annual sales of Mark Sellers said the company gives big businesses a leg up on to AP by the governor’s office be- Georgia-based fast-food chain will more than $100 million. The eco- would open five HopCats a year the competition, letting them fore the announcement. soon reveal plans for as many as 20 nomic downturn in 2009 reduced for the next six years, with Louis- meet startup capital requirements g Despite increased education- locations in the state by 2021. that figure to $15 million. ville, Ky., and Lincoln, Neb., among automatically. Republican Rep. al attainment and workforce par- The company plans to an- Now the bad days are in the past others, joining existing locations Ray Franz, of Onekama, who op- ticipation, Michigan’s working nounce a full “Michigan expan- for Michigan Wheel, which has in Ann Arbor, Detroit, East Lan- posed the bill, said it’s a “carve women continue to be out-earned sion” at the April 19 groundbreak- had three straight years of rising sing, Indianapolis and Madison, out” for the big retailers. by their male counterparts. Medi- ing of its first free-standing sales and expects sales between Wis. Sellers cited the “under- g Michigan would have the an annual pay for Michigan wom- restaurant in the state, in Lansing, $25 million and $27 million in served” Lincoln Park neighbor- toughest lead-testing rules in the en working full time is $37,419, where crews will begin working 2016. hood of Chicago as a potentially nation and require the replace- compared to $50,157 for men, ac- soon. “We’re like a Twinkie or a cock- strong location: “Within 10 blocks ment of all underground lead ser- cording to a new study from the The chain plans to open 15 to 20 roach — we don’t go away,” Bruce in any direction, there’s nothing.” vice pipes under a sweeping plan National Partnership for Women & locations in Michigan over the next Dieterle, the company’s president g Grand Rapids-based 616 De- Gov. Rick Snyder and a team of Families. Women in the state earn five years. A site plan for a Chick- and CEO, told the Grand Rapids velopment LLC and Loeks Theaters water experts were to unveil Fri- 75 cents for every dollar paid to fil-A location in Gaines Township Business Journal. “There’s very few Inc. detailed plans for a multi-phase, day in the wake of Flint’s water cri- men. Due to the pay gap, women near Grand Rapids was approved people in North America who can $140 million mixed-use develop- sis, The Associated Press reported. in Michigan earn nearly $16 billion last month, and a proposal for a do what we do.” ment in the Arena South District of Other proposals include requiring less than men — which could pro- second Grand Rapids-area loca- The company’s resurgence has downtown Grand Rapids, MiBiz re- utilities to test all schools, day care vide an additional 10 months of tion goes before the Wyoming Plan- been led by orders from the U.S. ported. The initial $100 million centers, nursing homes and simi- mortgage payments, on average, ning Commission this week. Coast Guard for its new Sentinel phase will include a nine-screen lar facilities — not just some peo- the study said.