|January 2013 • Vol. 19 • Number 18
Below and in the box on the left side of this page are some of the
stories you'll find in the most current issue.
The Hot List 2013
Every town has its buzzworthy topics and Traverse City is no exception. Whether it’s pouring multiple millions into a renovation, launching a hot new app, or just keeping something big under wraps, the business community is taking notice... and talking.
Here’s our annual list of what’s hot; stories you may be
hearing more about in the coming year.
There are close to 50 resale shops operating in the region – selling everything from gently used clothing to second-hand furniture to antiques – but Melissa Dow is banking on there being room for one more.
Dow, a personal trainer and wellness instructor, is diving into a new business adventure this spring with the help of her husband and two teenage daughters. The family will be opening a franchise in Traverse City of Plato’s Closet, a national retail chain specializing in used brand-name apparel for teens and 20-somethings. The company has over 350 stores in the country, including a dozen in southern Michigan – but Dow’s will be the first here.
“We’re excited because there’s nothing like this here in Traverse City,” says Dow. “We only sell modern clothing – usually styles from the last year-and-a-half or less.”
Dow is still finalizing the location for the store, but says it will be located close to the Grand Traverse Mall. She plans to open sometime later this spring and will accept local inventory for cash in the first weeks before transitioning to sales.
Resale shops are enjoying a boon both locally and across the country, thanks in large part to consumers tightening their wallets in a struggling economy. According to NARTS, the Association of Resale Professionals, there are currently more than 30,000 resale, consignment and thrift shops in the U.S. - a growth rate of seven percent for each of the past two years.
About 20 percent of Americans shop in resale stores regularly today, compared with 14 percent in 2008. That compares to 11.4 percent who shop in factory outlet malls, 19.6 percent who shop at apparel stores and 21.3 percent who shop at major department stores, according to NARTS.
The changing spending preference of local shoppers is a wave that Dow plans to surf successfully.
“We’re selling what you’d see on the shelves at the mall, but at a lower price,” she said. “You don’t have to weed through inventory to find trendy clothes, because that’s all we offer.”
Facebook and Twitter users all over the U.S. are buzzing about a big little app that’s making a splash well beyond its home in Traverse City.
Ozmott is an interactive mobile shopping app that features three concepts: shop, share and indulge.
“Ozmott provides a map of local merchants featuring offers in the area with a simple redemption process,” said Kristin Fehrman, director of marketing at Ozmott. “Users are able to select the offer they wish to purchase, show their smartphone to the cashier, and earn pips [reward points] toward future purchases.”
Pips can be redeemed online at the Ozmott store to purchase a “Luxe Offer” - a high-end product at a reduced price. Users are also encouraged to add their friends and share offers with them to earn extra pips, which also benefits the merchant on board, Fehrman said.
The next version of the Ozmott server application will be targeted toward smaller regional and local merchants, said Joseph Walker, founder and COO at Ozmott.
“This will allow the smaller regional and local merchants to sign up to use the Ozmott service and manage their accounts all through a simple web interface,” he said.
Ozmott’s latest client is the Grand Traverse Pie Company. They will have Ozmott offers up soon for both Traverse City restaurants as well as three Lansing-area locations.
In August, the company signed up sporting goods retailer MC Sports to provide offers for its 74 retail locations. Currently, Ozmott has a presence in 29 states and counting.
“We are rapidly growing and look forward to announcing additional national merchants in the new year,” Walker said. “As we grow within our region, we will begin to expand throughout the rest of the United States.”
And the bonus? Ozmott is bolstering Traverse City’s growing technology industry.
“It is a beautiful place to live and work,” said Walker. “We hope to attract even more talent as we strive to become a Groupon-sized company here in TC,” Walker said.
Cavallino Cafe Hagerty Insurance Agency
Latte lovers behold – a new cafe featuring the Ferrari of espresso machines opens this month in the new Hagerty building on Lake Avenue.
The Cavallino Café, managed by Morsels owners Jeff and Misha Neidorfler, seats 40 and is open to the public. It will showcase the La Marzocco Strada, a barista’s dream that can cost more than $20,000 brand-new.
“It’s top-of-the-line,” said Carmen Stevens, Hagerty’s vice president of corporate communications and community relations. “We’ll have direct-trade coffee and tea from Intelligentsia and a pourover drip coffee bar as well.”
The cafe will offer an Italian-themed breakfast and lunch menu featuring paninis and freshly prepared salads, as well as a daily selection of Morsels’ bite-sized cupcakes.
The décor has a classic 1950’s sports car feel, complete with leather seating and a car grill, Stevens said.
“The theme is built around the famous symbol of the Ferrari brand: the Cavallino Rampante, which means ‘prancing horse’,” she said.
Morsels owners Jeff and Misha Neidorfler will manage Cavallino along with award-winning barista and coffee director, Chuck Korson.
The ground-floor space will have a mix of banquette, four-top tables, and bar seating options. A staff of 15 baristas and cooks will work at both Morsels on Front Street and at Cavallino.
There are no additional retail establishments on the ground floor of the new Hagerty building, which is just west of its slightly older twin, but passersby might notice the Hagerty employee gym, Ironworks, which is currently not open to the public.
“Ironworks is a great benefit for our employees,” Stevens said. “It complements our wellness programming and supports Hagerty’s commitment to promoting a healthy lifestyle.”
Roundabouts in Traverse City have become less of a traffic calming device and more of a volatile debate topic for those at the decision-making level.
In 2013, it’s likely the arguments will heat up further, because roundabouts are surfacing as the answer to the region’s stickiest congestion points.
The advantages are hard to beat, said James Bruckbauer, transportation policy specialist at the Michigan Land Use Institute.
“Roundabouts reduce traffic congestion. They improve flow. They’re much safer for motorists, cyclists and pedestrians than traditional traffic stops,” he said. “They reduce noise in surrounding neighborhoods and emissions from vehicles. They work even when the power’s out. And the evidence is indisputable that they reduce the number of accidents.”
A roundabout is a circular intersection where drivers travel counterclockwise around a center island. There are no traffic signals or stop signs, so drivers must yield, then enter and exit at their desired street.
Studies by the Federal Highway Administration have found that roundabouts can increase traffic capacity by 30 to 50 percent compared to traditional intersections. A comprehensive plan for improvements to the city’s main transportation corridors, unveiled by city planners in October, included long-term recommendations for potential roundabouts at several major thoroughfares, such as the intersection of Garfield and Eighth streets.
A roundabout has also been mentioned as a possible component of a future Michigan Department of Transportation plan to solve traffic congestion on Division Street, particularly where it intersects with the entrance to the Village at Grand Traverse Commons on Eleventh Street.
If roundabouts – not to be confused with traffic circles, which don’t have the same yield requirements and calming design – seem to be a win-win scenario, why is there such fierce debate about them among city residents?
“In communities that have never had roundabouts, there is often fear or confusion over how they work,” said Bruckbauer. “They can be intimidating to drivers unfamiliar with them. Yet once they’re installed, it’s been shown time and time again that within a year, a majority of drivers in that city support them.”
Support them or not, drivers here will soon use them. Construction on the region’s first roundabout – at the intersection of M-115 and M-37 in Mesick – is set to begin just after Labor Day this year.
A second roundabout is planned for the intersection of Lautner Road and M-37 in Acme, located at the entrance to the proposed new Meijer store.
Traverse City locals love their trails and they have Julie Clark and TART Trails to thank. Bikers, hikers, runners and babystollering mommas happily crisscross on TART-funded trails near lakes, through woods, and along the bay.
For 2013, expect more of the same.
One of the most anticipated trails is scheduled for construction this summer: the next phase of the Boardman Lake Trail between Oryana and 14th Street.
“We’ve been working closely with the city and Lake Ridge Condominiums on an alternative design, which includes a loop trail,” Clark said, who said the design concept was approved by the city in November.
They will continue to work to bring the trail south around the entire lake.
“We’re thrilled to see construction start and looking forward to a better way to Right Brain Brewery!” said Clark, who whose prior work included design and development of more than 35 miles of urban trail in Charlotte, N.C.
Other big news they hope to break this year is on the Acme trail.
“We secured the easement for the trail through the new Meijer development; now we hope to see trail connections come to fruition,” she said. “Acme, Elk Rapids, the Vasa and the new shoreline project [in Acme] - there are fantastic assets within this corridor that can be better connected.”
Other hopes for 2013 include a start on the Sleeping Bear Heritage Trail between the Dune Climb and Empire, as well as phase two, which stretches from Glen Arbor to Port Oneida.
“The SBHT is a trail of state-wide significance and we’re determined to keep on target for the private fundraising dollars we need to continue construction,” she said about the project, which is a collaboration between TART, Northwest Michigan Council of Governments, Michigan Department of Transportation, National Park Service and Friends of Sleeping Bear. “We hope to have 2013 be a banner year.”
Historic Barns Park and Botanic Gardens
In a struggling economy, fundraising campaigns for local organizations can often take a hit. But Matt Cowall, executive director of the joint Traverse City and Garfield Township recreational authority, is happy to report that a $1.5 million capital fundraising campaign for the Historic Barns Park and Botanic Gardens at the Village at Grand Traverse Commons is well ahead of its December 2013 deadline.
“We’re to the point where we may be able to begin some construction in 2013 instead of 2014,” said Cowall, noting that the development timeline still depends on how many pledged donations materialize into actual funds in the coming months.
The campaign allocates $750,000 to the development of the park’s 19th century cathedral barn and $750,000 to the creation of a visitor center. It also includes professionally installed gardens by the Botanic Garden of Northwest Michigan.
The barn restoration, visitor center, and gardens are the first phase in a three-phase project anticipated to span the next decade. Cowall said that final lead paint removal is currently taking place at the barn and former grainery, the future home of the Garden visitor center.
Three local utility providers – Traverse City Light & Power, Cherryland Electric Cooperative and Consumers Energy Company – will also team up in a rare partnership this winter to drill and install a geothermal heating and cooling system on the property. The project is part of a developmental goal to use renewable energy sources whenever possible during renovations.
Cowall said the community could see the cathedral barn open and available for use as early as summer 2014. The rec authority plans to partner with a private contractor to manage event rentals on the property, a process that could begin with securing letters of interest and potential bids in 2013.
As for the gardens, board chair Karen Schmidt hopes to see the visitor center open and first major gardens planted this summer, with a completed 25-acre park featuring a walking labyrinth and healing, walled and edible gardens set to come in the next few years.
“I believe this property – with the gardens, park and barns – will be the crown jewel of our region when it’s completed,” she said.
Former Federico’s Building
In March 2011, local entrepreneur Jeff Schwartz and his wife Marie purchased the historic bank building at the northeast corner of Front and Cass streets – formerly home to Federico’s Design Jewelers – for $530,000.
In the nearly two years since, the couple have stayed busy fielding inquiries from local developers and courting national retailers for the space – though no concrete plans have yet formalized for occupancy.
With a vacancy rate of only 2.2 percent in downtown Traverse City, that’s a situation that is likely soon to change.
Schwartz says the 6,200-square foot property featuring neoclassical architecture, airy interiors and views of both Grand Traverse bay and downtown Front Street make the building “a perfect location” for the right business.
He and Marie believe the space is particularly well suited to a national brand, and says there has been interest from companies in that category.
Since the building is zoned for mixed use (retail, office and residential), the couple may settle down at the property, hinting at plans to develop an upper level into an apartment if the right tenants materialize below. They may also expand the building northward.
Given the high-profile nature of the property, Schwartz says he isn’t concerned if he’ll find the right tenant – it’s simply a matter of when.
“We feel optimistic, especially with the limited amount of space available downtown, that someone’s going to come along who’s a great fit for the building,” he said.
In the meantime, the duo is making good use of the property by lending periodic space to a number of local non-profit organizations. The Traverse City Film Festival, National Writers Series, Goodwill Industries and Women’s Resource Center have all had a presence in the building in the past two years.
It’s a little sci-fi and a little old school. It’s a light without batteries. It’s something your grandma used to fire up for her tea.
And it’s the newest product from TC’s Tellurex Corporation.
The product is the tPOD1, a thermoelectric generator that produces hours of bright light … powered by a simple tea candle.
The tPOD1 (thermoelectric power on demand) began production in December with a pre-order of 1,200 from Kickstarter.com, a group funding website, said Richard Harmon, tPod program manager at Tellurex.
“It’s starting to get a lot of attention,” he said. “We sold 1,200 of them in 30 days on Kickstarter. Right now we have 500 in inventory and expect orders to outstrip inventory.” Tellurex raised $111,000 though the funding campaign.
The product is powered by a simple candle – not by solar energy or petroleum products. One four-cent tea candle provides four hours of bright light. The lamphead on the tPOD1 is 20 times brighter than that of a candle, Harmon said.
The tPOD1 offers an economical alternative at about 1/17th the operating cost of lamp oil. Another benefit beyond those of its solar competitors is that it’s useable night and day – not just when the sun shines.
And next up in production is using the tPOD1 as a personal power generator that can be used to charge a companion battery pack, which in turn can charge cell phones.
The tea candle idea isn’t a new one. Harmon saw it in a 1958 Radio and Television magazine for powering radios in Russia. But the difference from 50 years ago is that now thermoelectrics and modern production techniques make the technology feasible and affordable.
The $69 tPOD1 is perfect for the outdoor adventurer/camper/hiker, for people in power outages, and for those living off the power grid.
Recently, Harmon traveled to Africa to show the product in a conference where more than 600 million citizens do not have access to electricity. Traditionally, African residents use kerosene as a light source, which is expensive, inefficient and hazardous.
The tPod1 might just change that.
Petoskey Stone Tile Inc.
Pairing a post-modern suburban home with 350 million-year-old relics might seem dramatic, but fans of northern Michigan’s Petoskey stones have no trouble walking on the wild side.
Josh McMillan, co-owner and operations manager at Petoskey Stone Tile Inc., creates his pieces using the ancient coral.
The Petoskey appears in everything from kitchen back splashes to fireplace tiles – all with the look, feel and memory of a Michigan beach.
“Everyone has fallen in love with the end result of our products,” McMillan said. “They aren’t just buying tile or cabinet knobs that look great in their home – they’re buying a conversation piece and a constant reminder of the beauty and memories they had in northern Michigan.”
Each product is hand-cut, polished and assembled by local artisans. Since the real estate market has rebounded, McMillan has seen an uptick in sales. He’s also been working with more businesses for commercial applications.
“The Apache Trout and Grill inlaid some of our tile in their new bar top,” he said. “It helps to have an install where people frequently see our products.”
McMillan has customers across the board: local beach lovers to far-flung fans who cherish their trips up north.
“Petoskey stones are something we locals, as well as people that tour our area, love so much,” he said. “Just last month we had orders from people living in Florida and Texas. We also have a commercial application that’s going in down in the Detroit area.”
So where does McMillan find these beauties, stones that some people search a lifetime for?
“Before it became a business, I would find them just like everyone else, on the beaches of northern Michigan,” he said. “Because of the increase in demand, I don’t have the time to comb the beach like I used to. Thankfully over the years I have met people in the industry who I can go to if I’m in need of stones.”
And how does he know if a stone is a keeper?
“They are all unique in their own right, and no two are ever the same,” he said. “But ideally, I want one that has a good pattern and goes completely through the whole stone.”
Porterhouse Productions, Owner
Local festival guru Sam Porter will only say this: There’s something big coming in 2013.
Other than that, he’s not telling.
“It will have a huge positive economic impact and we are building advisors and welcoming community to get involved at our Good Work Collective networking events,” he said. “We are excited to go public soon.”
Porterhouse Productions is a family-built company that creates events for the music, arts, ideas and community of northern Michigan. In the past four years, more than 50,000 attendees have come to events, which range from the Winter Microbrew & Music Festival and Paella in the Park to more than 20 City Opera House shows and a dinner event with Mario Batali.
So what can he divulge?
For starters, the Feb. 9 Winter Microbrew & Music Festival is going to be held in downtown Traverse City at the Sara Hardy parking lot at Cass and Grandview. There will be craft beers and music in four large heated tents that hold about 1,000 people each, he said. The venue will offer more capacity than last year’s event, which sold out at 3,200.
The biggest new component is “Craft Brew Week” running Feb. 2-9 where they will team with area venues and restaurants to highlight goodies such as beer pairing menus and “meet the brewer” events.
What else to watch for in 2013? Think fun and funky.
“This winter we are tricking out our historic 1946 Ford food truck, Curbie,” Porter said. “It’s a project I’m excited about because it connects youth with historic vehicles and its mission is to promote local foods.”
He says to stay tuned to Iscreamfood.com as details unfold.
The other big news is that alongside their event planning, Porter and friends are launching a new company where “events marketing and storytelling” meets “design and development.”
“We have in-house projects, herds of talented contractors and the ability to support entrepreneuring in our region from napkin startup to investment positioning,” Porter said. “Think of it as a micro-economic gardening hub with everything from legal to creative involved.”
Holiday Inn West Bay
A familiar downtown landmark will undergo a multi-million dollar extreme makeover with increased conference space, a redesigned nightclub, and modern landscaping.
Last summer, the private equity investment firm ValStone Partners of Birmingham, Mich. bought the Holiday Inn West Bay, a late 60s-era hotel.
The redesign and upgrades, expected to be finished by late spring, will begin this month in partnership with Interstate Hotels & Resorts, a U.S.-based global hotel management company.
“One of our key goals is to ensure that no area of the hotel goes untouched,” said hotel manager Deborah Brown. “We want to ensure that our guests and patrons feel the upgrades in every corner.”
Each of the hotel’s 179 rooms and its lobby will be “completely new, from floor to ceiling,” said Brown.
There will also be an additional 1,000 feet of conference space for group meetings.
Brown also said Shimmers Lounge will remain a nightclub, but undergo an “amazing facelift,” which includes a new name. It will also be open for lunch and dinner.
“That will allow for everyone to enjoy its amazing views all day long,” said Brown. “It will then transform into a dance club during the later part of the evening.”
The building’s exterior, along with its landscaping, will also get a makeover. The bayside patio will be resurfaced, and new furnishing, fire pits, heat lamps and a stage will be added. All other public spaces, pools, and outlets will be renovated as well, with more than half a million dollars slated for fire and safety upgrades.
While the renovations are extensive, Brown said that the hotel will remain open during the entire project, which is expected to be completed by the end of April.
It’s nothing new for a dad and his sons to knock a few boards and screws together for a weekend project. But for Scott Diment and his two sons, Dugan, 18, and Jensen, 14, playtime turned into serious business this summer with the launch of 3DEE Boardworks.
Just now hitting store shelves, 3DEE’s longboards - a hugely popular, larger variation of a skateboard used for downhill, carving, slalom and free ride – are the result of a mutual interest in the sport the father and son trio have.
“This was something my boys and I always dreamed of doing,” said Scott Diment, a technology education teacher at Traverse City East Middle School who taught his boys how to carve turns when they were about six. “We are having a blast designing, testing and developing the best longboards we can make.”
After coming up with their unique design, they ship it to California, where the boards are produced.
Scott Diment’s connection to his manufacturer in California resulted from a popular unit he teaches called “Create-a-Skate,” in which students develop their own skateboard decks incorporating math, science, engineering and design in the process.
Participation in this program, which is national, gave Diment and his sons the connections they needed on the west coast.
“Sales have been local and small so far, but the product has been received well and we are fine tuning our initial design for 2013,” he said. “This is the year we plan to market throughout the state and at a national level.”
Along with launching their website this year, the Diments are planning on designing and selling a smaller “urban assault” board to complement their longboard line.
3DEE longboards cost about $90, or $250 with the full set that includes wheels and trucks. They are available at the M-22 store and Brick Wheels in Traverse City, and at the Wet Mitten stores in Traverse City and Grand Haven.
Keen Technical Solutions
One Traverse City company now shares a pedigree with Intuit, Zappos, Patagonia, Oracle, and Microsoft.
In its annual “500 Fastest Growing Private Companies” profile, Inc. Magazine recently awarded Keen Technical Solutions 60th place.
The company, which helps other companies cut their energy usage and costs, reported 4,101 percent growth over three years and revenue of $4.2 million.
CEO and co-founder Steve Morse says his goal is to make the list again in 2013.
“Our first year, in 2008, we had two customers to keep happy,” he said. “Now, we’re pushing 1,200.”
So what’s behind the success? According to Morse, it’s more than just selling products and services. Keen’s energy advisors consults with businesses on how to save money by doing things like installing energy-efficient lighting, using green technologies, and performing energy audits.
The team will also administer available rebates and incentives, provide an energy guarantee, and fund the projects based on savings if capital is a concern.
As of press time, its recommendations had saved clients more than $20 million, with more businesses coming on board.
“In 2012, our business was up 50 percent over last year,” company president and co-founder Tim Pulliam said. “In 2013, we’re planning for four times over 2012.”
Although the company’s presence is primarily Midwestern, Keen has fielded projects in Louisiana, North Carolina, Connecticut, and Florida.
One new area of expansion this year will be into Michigan’s tribal communities. Derek Bailey, former tribal chairman of the Grand Traverse Band of Ottawa and Chippewa Indians, was hired in September to head up that effort.
“In every community there’s a need for energy sustainability, and with tribal communities it’s no different,” Bailey said. “At Keen, our intention is to build first a relationship, and then offer exciting cost-saving measures.”
Keen’s initial focus would be on the Midwest tribal nations and then reaching out to Native Americans in other regions, including Canada, Bailey said.
“The energy savings can be put to use in other areas, such as elders and youth programing,” he said. “This is a true win-win situation.”
Morse and Pulliam said they are working on another division that will “put Keen on the national map.” They hope to have an announcement in the coming months.
Traverse City Whiskey Co.
Prohibition-era distilling patents approved by the feds inspired one of the most recent spirit manufacturers to open up shop.
“The patents were approved by the U.S. government during the prohibition,” said Chris Fredrickson, who stumbled across a few of his great-grandfathers’ distilling patents a few years ago. “Crazy, right?”
Today, Traverse City Whiskey Co., owned by Frederickson and two college classmates, reflects quite a different cultural mindset than the one faced by Frederickson’s ancestor.
In the coming months, the partners are expected to finalize construction in downtown Traverse City on their 1,200 sq. ft. distillery and tasting room, which will seat about 25 and serve food.
For now, they have collaborated with a Midwestern distiller to launch their straight bourbon whiskey while growing their grains on Fredrickson’s family farm in Empire. He said they’ve worked to create a taste and brand profile that complements the “hometown character” of Traverse City.
“As we build a larger national footprint,” Fredrickson said, “our mission is to continue strengthening our area’s notoriety, continuing to build Traverse City’s presence on the map and adding new jobs to the area.”
They are also hoping the product will draw media attention and tourism to the area. In September, TC Whiskey got a mention in an online New York Times article.
“Sales have been incredible,” Fredrickson said. “In the last couple months we have been blessed with a few major jumps which have allowed for rapid expansion into two new markets [Illinois and Indiana] and potentially three additional markets [California, Tennessee and Colorado] by early 2013.”
A 750ml bottle sells for about $27 and can be found at Bayside Market, The Beverage Company, Deering’s Market, Dockside Party Store and more.
Or if you’d like, tip your glass to the guys at Fire Fly, Boone’s Long Lake Inn, Brothers Tap Room, Red Ginger, The Boathouse, Trattoria Stella and others.
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