Downtown Lansing Inc. (Principal Shopping District)

Downtown Lansing Partnership Inc. March 13, 2025 12:30 p.m. (or directly after DLI Board Meeting) 215 S. Washington Sq. Lansing, Michigan 48933 Board Meeting Agenda – Rescheduled for March 13 1. Call to Order: 2. Approval of Agenda: 3. Approval of November Meeting Minutes (from rescheduled last board meeting): 4. Macotta Club Sub-Committee Discussion/Action Items a. ReCap of Macotta Club to Date b. Why Macotta Club c. Potential Capital Stack Sources d. Staffing & Other e. Macotta General Contractor-Action Needed 5. DLPI January & February Financials 6. Adjourn Downtown Lansing Partnership Inc. November 14, 2024 12:30 p.m. (or directly after DLI Board Meeting) 112 S. Washington Sq. Lansing, Michigan 48933 Board Meeting Minutes 1. Call to Order: Meeting called to order at 12:24 p.m. 2. Approval of Agenda: Motion by K. Dorshimer. Second by J. Durham. Motion passed unanimously. 3. Approval of October Meeting Minutes: Motion by K. Dorshimer. Second by K. Tomac. Motion passed unanimously. 4. Macotta Club Sub-Committee Discussion/Action Items a. Maner Costerisan Financial Report: Guests Abby Daugherty and Toni Horsch from Maner Costerisan attended the DLPI meeting and were introduced as the team working on Macotta Club’s financial reports, structures, as well as financial policies and procedures. They shared the complexities of the project and updates regarding the work they’re doing for Macotta. This includes guidance they’re providing, tax work, preps for audits, payroll, and more to set-up the accounting structure needed for both the construction phase, as well as once Macotta opens. Board asked questions regarding best practices for how the program and restaurant should run over time, best practices, KPI’s and other metrics we should be measuring. Maner can help with this and provide recommendations as we get closer to opening and are earning revenue. b. Financials: J. Reinhardt shared financials that have taken place since last month’s meeting. Overall the charges are few with our Owner’s rep. as well as restaurant consultant. c. Other General Updates: Board asked about the status of funding through Michigan Community Capital as well as Michigan Saves. Michigan Community Capital was finalizing review this week and will follow-up with staff before it goes through. Staff provided an update regarding the next steps with Michigan Saves in terms of electrical information and quote gathering. Also reworking loan with Lake Trust to account for additional costs. The State of Michigan MEDC is also in serious discussions to award Macotta Club additional funding. 5. DLPI Financials: C. Edgerly presented the financials for DLPI from October. The expenditures and income are not unexpected, and Cathleen provided a highlevel overview of fiduciary partnerships, annual fees, liquor license an application charge as well as transfers in and out. No questions from the Board. J. Durham motioned to approve the monthly DLPI financials for October. K. Dorshimer seconded. Motion passed unanimously. 6. Adjourn: Motion to adjourn at 12:48 p.m. by J. Estill. Second by J. Pugh. Motion passed unanimously. Sub-ŽŵŵŝƩĞĞŵĞŵďĞƌƐ͗:͘ƐƟůů͕:͘ƵƌŚĂŵ͕:͘WƵŐŚ ^ƚĂī>ĞĂĚƐ͗:͘ZĞŝŶŚĂƌĚƚ͕͘ĚŐĞƌůLJ Project Summary: /ŶϮϬϮϮƚŚĞ>/ĂŶĚ>W/ŽĂƌĚŚĞĂƌĚĨƌŽŵƐƚĂīƌĞŐĂƌĚŝŶŐƚŚĞŶĞĞĚŽĨĂƉƌŽƉŽƐĞĚƌĞƐƚĂƵƌĂŶƚ ĂĐĐĞůĞƌĂƚŽƌƉƌŽŐƌĂŵƚŚĂƚǁŽƵůĚďƵŝůĚŽīƚŚĞƐƵĐĐĞƐƐŽĨDŝĚĚůĞsŝůůĂŐĞĂƐǁĞůůĂƐŽƚŚĞƌĨŽŽĚŝŶĐƵďĂƚŽƌƉƌŽŐƌĂŵƐ͕ŚĞůƉŝŶŐ ĨŽƐƚĞƌĂŶĞŶƚƌĞƉƌĞŶĞƵƌŝĂůĐŚĂŝŶĨŽƌďƵƐŝŶĞƐƐĞƐŝŶƚŚĞĨŽŽĚĂŶĚŚŽƐƉŝƚĂůŝƚLJŝŶĚƵƐƚƌLJ͘>/ǁĂƐƐƵĐĐĞƐƐĨƵůŝŶƐĞĐƵƌŝŶŐĐůŽƐĞƚŽ ΨϯDŝŶƐƚĂƚĞǁŝĚĞĨƵŶĚŝŶŐƵŶĚĞƌƚŚĞD͛ƐZĞǀŝƚĂůŝnjĂƟŽŶĂŶĚWůĂĐĞŵĂŬŝŶŐŐƌĂŶƚ͕ĂƐǁĞůůĂƐĂ^ƚĂƚĞŐĞŶĞƌĂůĨƵŶĚ ĂůůŽĐĂƟŽŶĨŽƌƚŚĞƉƌŽũĞĐƚ͘ dŚĞDĂĐŽƩĂůƵď ǁĂƐĚĞƐŝŐŶĞĚƚŽ ďƌŝŶŐƚŽŐĞƚŚĞƌ16 ĨŽŽĚ-ďĂƐĞĚ ďƵƐŝŶĞƐƐĞƐŝŶĐůƵĚŝŶŐϲƌĞƐƚĂƵƌĂŶƚĐŽŶĐĞƉƚƐĂŶĚƐƉĂĐĞ ĨŽƌϭϬŽƚŚĞƌĨŽŽĚĐŽŶĐĞƉƚƐŝŶƚĞƌĞƐƚĞĚŝŶǁŚŽůĞƐĂůĞ͕ĨŽŽĚƚƌƵĐŬƐ͕ĂŶĚĐĂƚĞƌŝŶŐďƵƐŝŶĞƐƐŵŽĚĞůƐ ŝŶŽǁŶƚŽǁŶ>ĂŶƐŝŶŐ͛Ɛ ŚŝƐƚŽƌŝĐ<ŶĂƉƉ͛ƐďƵŝůĚŝŶŐ͘dŚĞƐƉĂĐĞǁŝůůĂůƐŽŝŶĐůƵĚĞƚŚƌĞĞĨŽŽĚƚƌƵĐŬƐĂŶĚĨŽŽĚŵĂŬĞƌƐ͕ĂůŽŶŐǁŝƚŚĂĨƵůů-ƐĞƌǀŝĐĞďĂƌ͘ ^ŝŶĐĞƚŚĞŽƌŝŐŝŶĂůĐŽŶĐĞƉƚ͕ĂĚĚŝƟŽŶĂůƌĞĐŽƌĚŝŶŐƐƚƵĚŝŽƐ͕ĞĚƵĐĂƟŽŶĂůƉƌŽŐƌĂŵŵŝŶŐ͕ŵĞnjnjĂŶŝŶĞƐĞĂƟŶŐĂŶĚďĂƐĞŵĞŶƚ ŬŝƚĐŚĞŶƐƉĂĐĞŚĂƐďĞĞŶĚĞƐŝŐŶĞĚƚŽŽĐĐƵƉLJƵƉƚŽϯϬ͕ϬϬϬƐƋ͘ĨĞĞƚŽĨƚŚĞĮƌƐƚŇŽŽƌŽĨƚŚĞ<ŶĂƉƉ͛ƐƵŝůĚŝŶŐ͘ĐƟǀĂƟŶŐĂ ǀĂĐĂŶƚƐƉĂĐĞĂŶĚďƵŝůĚŝŶŐĂƐƵƐƚĂŝŶĂďůĞŵŽĚĞůƚŽƌĞĐƌƵŝƚ͕ƌĞƚĂŝŶĂŶĚĞŶŚĂŶĐĞ>ĂŶƐŝŶŐ͛ƐĐƵůŝŶĂƌLJƐĐĞŶĞ͘&ŽƌŵĞƌŽĂƌĚ ŵĞŵďĞƌĂŶĚůĞŐĂůĐŽŶƐƵůƚĂŶƚ:͘s͘ŶĚĞƌƚŽŶĂƐƐŝƐƚĞĚƐƚĂīŝŶĮůŝŶŐƚŚĞĂƌƟĐůĞƐŽĨŝŶĐŽƌƉŽƌĂƟŽŶĂƐǁĞůůĂƐĞƐƚĂďůŝƐŚŝŶŐ DĂĐŽƩĂůƵďĂƐŝƚƐŽǁŶ>>͘dŚĞ>ŚĂƐĂůƐŽĂƐƐŝƐƚĞĚŝŶĂƉƉůLJŝŶŐĨŽƌĂůŝƋƵŽƌůŝĐĞŶƐĞĨŽƌdŚĞDĂĐŽƩĂůƵď͘dŚĞ ƐĞĐƵƌŝŶŐŽĨĂůŝƋƵŽƌůŝĐĞŶƐĞŝƐƐƟůůŝŶƉƌŽŐƌĞƐƐ͘ Timeline: KƌŝŐŝŶĂůůLJƉůĂŶŶĞĚƚŽŽƉĞŶŝŶ^ƵŵŵĞƌ͕ϮϬϮϰ͘dŚĞŶĚĞůĂLJĞĚƵŶƟůĞĐĞŵďĞƌϮϬϮϰ͘tŝƚŚƚŚĞůĂƚĞƐƚĨƵŶĚŝŶŐ ƐŚŽƌƞĂůůƐĂŶĚĚĞůĂLJƐǁŝƚŚƉĞƌŵŝƚƐĂŶĚƌĞŽƌŐĂŶŝnjĂƟŽŶŽĨǁŚŽǁŝůůďĞůĞĂĚŝŶŐĐŽŶƐƚƌƵĐƟŽŶ͕ǁĞĂƌĞŚŽƉŝŶŐƚŽŽƉĞŶŝŶϮϬϮϱ͘ ^ŚŽƵůĚǁĞĐŽŶƟŶƵĞƚŽŵŽǀĞĨŽƌǁĂƌĚǁŝƚŚƚŚŝƐƉƌŽũĞĐƚ͕ǁĞƉůĂŶƚŽďƌĞĂŬŐƌŽƵŶĚŝŶDĂƌĐŚ ϮϬϮϱǁŝƚŚĂϲ-ϴŵŽŶƚŚ ĐŽŶƐƚƌƵĐƟŽŶƟŵĞůŝŶĞ͘ ^ƚĂīͬŽŶƐƵůƚĂŶƚƐ/ŶǀŽůǀĞĚǁŝƚŚƚŚĞWƌŽũĞĐƚ͗ dŽĚĂƚĞǁĞŚĂǀĞďƌŽƵŐŚƚŽŶhƉŽƌŽŶƚŚĞZŽĐŬƐƚŽŵĂŶĂŐĞƚŚĞƚƌĂŝŶŝŶŐƐ ĂŶĚĞĚƵĐĂƟŽŶĐŽŵƉŽŶĞŶƚŽĨDĂĐŽƩĂůƵď͘dŚŝƐĐŽŶƐƵůƚĂŶƚŚĂƐĂůƐŽďĞĞŶĂŶŝŶƚĞŐƌĂůƉĂƌƚŽĨƉůĂŶŶŝŶŐƚŚĞŬŝƚĐŚĞŶůĂLJŽƵƚ ĂŶĚĞƋƵŝƉŵĞŶƚŶĞĞĚƐ͕ŵĞĞƟŶŐǁŝƚŚƉƌŽƐƉĞĐƟǀĞDĂĐŽƩĂůƵďƉĂƌƟĐŝƉĂŶƚƐĂŶĚŵŽƌĞ͘/EĂĚĚŝƟŽŶ͕ƐŝŶĐĞǁĞĮƌƐƚ ĂŶŶŽƵŶĐĞĚƚŚŝƐƉƌŽũĞĐƚ͕ǁĞŚĂǀĞďƌŽƵŐŚƚŽŶĂŶKǁŶĞƌ͛ƐZĞƉƌĞƐĞŶƚĂƟǀĞ͕>ĞŐĂůƚĞĂŵĂŶĚWĮƌŵƚŽƐƵƉƉŽƌƚƚŚĞƉƌŽũĞĐƚ ĂŶĚŽƵƌŝŶƚĞƌĞƐƚƐ͘ &ƵŶĚŝŶŐ^ŽƵƌĐĞƐƚŽĂƚĞ͗ x ZW'ƌĂŶƚ&ƵŶĚŝŶŐ͗Ψϭ͕ϱϬϬ͕ϬϬϬ x D'ĞŶĞƌĂů&ƵŶĚůůŽĐĂƟŽŶ͗Ψϭ͕ϱϬϬ͕ϬϬϬ x >ĂŬĞdƌƵƐƚĂŶŬĂŶĚ>ĂŬĞdƌƵƐƚ&ŽƵŶĚĂƟŽŶ͗Ψϳϱ͕ϬϬϬ x ŽŶƐƵŵĞƌƐŶĞƌŐLJ&ŽƵŶĚĂƟŽŶ'ƌĂŶƚ͗ΨϭϬϬ͕ϬϬϬ x ĂƉŝƚĂůZĞŐŝŽŶŽŵŵƵŶŝƚLJ&ŽƵŶĚĂƟŽŶŽŵŵŝƚŵĞŶƚ͗ΨϭϬϬ͕ϬϬϬ x ŝƚLJŽĨ>ĂŶƐŝŶŐ͗Ψϭϱ͕ϬϬϬ dKd>ŽŵŵŝƩĞĚ͗Ψϯ͕ϮϵϬ͕ϬϬ WƌŽũĞĐƚĞĚƵĚŐĞƚĨŽƌDĂĐŽƩĂ͗ Ψϴ͕ϬϬϬ͕ϬϬϬ ĚĚŝƟŽŶĂů&ƵŶĚŝŶŐ^ŽƵƌĐĞƐ/ĚĞŶƟĮĞĚĨŽƌƚŚĞĂƉŝƚĂů^ƚĂĐŬ͗ x DŝĐŚŝŐĂŶŽŵŵƵŶŝƚLJĂƉŝƚĂů͗hƉƚŽΨϰD͕ŝĚĞĂůůLJŽƵƌĂƐŬǁŽƵůĚŶ͛ƚƚŽƉΨϯDĐŽŶƐƚƌƵĐƟŽŶďƌŝĚŐĞůŽĂŶ x >ĂŬĞdƌƵƐƚƌĞĚŝƚhŶŝŽŶ͗hƉƚŽΨϭ͘ϮDŝŶĂůŝŶĞŽĨĐƌĞĚŝƚ x ,ĂƌƞŽƌĚDĂŝŶ^ƚƌĞĞƚŵĞƌŝĐĂ'ƌĂŶƚ͗ΨϭϬϬ͕ϬϬϬ x dZh/^d&ƵŶĚ͗Ψϭ͕ϬϬϬ͕ϬϬϬŐƌĂŶƚ x d͗ΨϱϬϬ͕ϬϬϬ x ĂƉŝƚĂůƌĞĂDŝĐŚŝŐĂŶtŽƌŬƐ͗ΨϭϬ͕ϬϬϬ x WŽƐƐŝďůĞŽƚŚĞƌD^ŽƵƌĐĞƐ͗Ψϭ͕ϬϬϬ͕ϬϬϬ x ZĞŶƚĨƌŽŵWĂƌƟĐŝƉĂŶƚƐ͗ΨϴϮ͕ϬϬϬĂŶŶƵĂůůLJ dKd>ŝŶWŽƐƐŝďůĞ^ŽƵƌĐĞƐ͗Ψϱ͕ϴϭϬ͕ϬϬϬ͘ϬϬ нZĞŶƚŽĨΨϴϮ͕ϬϬϬ ƵƌƌĞŶƚdŽ-Ž͛Ɛ KǀĞƌEĞdžƚϯϬĂLJƐ͗ x ZĞǀŝĞǁŝĚƐĂŶĚ^ĞůĞĐƚŽŶƐƚƌƵĐƟŽŶdĞĂŵ x WŽƐƚĂŶĚƐƚĂƌƚƚŽŝŶƚĞƌǀŝĞǁĨŽƌĂ'ĞŶĞƌĂůŽŶƚƌĂĐƚŽƌ x ^ĞĐƵƌĞĂŵŝŶŝŵƵŵŽĨΨϭ͕ϬϬϬ͕ϬϬϬŝŶĨƵŶĚŝŶŐƐƵƉƉŽƌƚŝŶŽƌĚĞƌƚŽ ŚĂǀĞƐƵƉƉŽƌƚĨŽƌĂůŽĂŶƌĞƋƵĞƐƚǁŝƚŚDŝĐŚŝŐĂŶ ŽŵŵƵŶŝƚLJĂƉŝƚĂů x >ĞĂůƚĞĂŵƉƌŽǀŝĚĞĚƌĂŌĂŐƌĞĞŵĞŶƚƐĨŽƌDĂĐŽƩĂůƵďƉĂƌƟĐŝƉĂŶƚƐ x &ŝŶĂůƉĞƌŵŝƚĂƉƉƌŽǀĂůĨƌŽŵƚŚĞŝƚLJŽĨ>ĂŶƐŝŶŐ x EĞdžƚŵŽŶƚŚ͕ĚĞƚĞƌŵŝŶĞŝĨ>W/ŽĂƌĚĂƉƉƌŽǀĞƐŵŽǀŝŶŐĨŽƌǁĂƌĚǁŝƚŚƚŚĞƉƌŽũĞĐƚ The Macotta Club: A Transformational Investment in Downtown Lansing Downtown Lansing isn’t just changing—it’s transforming. With revitalization and growth on the horizon, The Macotta Club is more than a project; it’s an investment in our city’s future. By activating a long-underutilized space, it fosters sustainable economic growth and fuels downtown’s resurgence. A Bold Step Toward Revitalization Momentum is building with projects like Ovation and New Vision Lansing reshaping our district. The Macotta Club ĤĺĖIJŜϙťēĖŜϙſÍŽôϠϙIJĺťϙĤŪŜťϙƱīīĖIJČϙÍϙŽÍèÍIJťϙŜŕÍèôϙæŪťϙèŘôÍťĖIJČϙÍIJϙôèĺŜƅŜťôıϙċĺŘϙŜıÍīīϙæŪŜĖIJôŜŜϙŜŪèèôŜŜϟ Currently, the 300 block of S. Washington Square and Washtenaw is quiet after 3:00 p.m., with little activity. The aÍèĺťťÍϙīŪæϙèēÍIJČôŜϙťēÍťϙæƅϙÍťťŘÍèťĖIJČϙċĺĺťϙťŘÍƯĖèϠϙôƄťôIJîĖIJČϙæŪŜĖIJôŜŜϙēĺŪŘŜϠϙÍIJîϙôIJôŘČĖƏĖIJČϙîĺſIJťĺſIJϠϙŜôťťĖIJČϙ the stage for a thriving, 24/7 district. More importantly, this initiative directly supports three of the four goals in our Strategic Plan, revitalizing a top- priority building in the CMA’s downtown vision. A Sustainable Solution to Fill Vacant Spaces Rather than waiting for businesses to trickle in, The Macotta Club cultivates a pipeline of restaurant entrepreneurs, ensuring long-term tenant stability and economic resilience. x A Launchpad for Entrepreneurs – Provides mentorship, marketing, and business development, helping food startups scale before committing to standalone locations, enabling them to succeed long term. x Momentum Creates Momentum – A cluster of thriving businesses—restaurants, cafes, bars, and markets—ÍťťŘÍèťŜϙċŪŘťēôŘϙĖIJŽôŜťıôIJťϙÍIJîϙæĺīŜťôŘŜϙèĺIJƱîôIJèôϙĖIJϙîĺſIJťĺſIJЍŜϙċŪťŪŘôϟ x A Model for Smart Growth – Converts a vacant space into a dynamic food hub, proving how strategic investments can drive impactful real estate use. With our neighborhood set for major investment, The Macotta Club will be a catalyst for further revitalization along S. Washington Square. Strengthening the Local Economy & Small Business Success The Macotta Club strengthens the local economy from the ground up, ensuring small businesses don’t just survive — they thrive. x Higher Success Rates for Small Businesses – Access to capital, mentorship, and business training improves long-term viability.  x Adapting to a Changing Downtown – As downtown shifts from a commuter-îŘĖŽôIJϙſĺŘħċĺŘèôϙťĺϙÍϙıĖƄôî- use community, adaptable business models like takeout, delivery, and late-night dining ensure sustainability. x
ϙ‡Ėŕŕīôϙ(ƯôèťϙĺIJϙ[ĺèÍīϙŪŜĖIJôŜŜ – “ēŘĖŽĖIJČϙŘôŜťÍŪŘÍIJťŜϙîŘĖŽôϙîôıÍIJîϙċĺŘϙæŘôſôŘĖôŜϠϙèĺƯôôϙŜēĺŕŜϠϙ entertainment, grocery stores, and retail. x A More Desirable Downtown – Increased activity makes Lansing a more attractive place to live, work, and socialize, boosting both commercial and residential occupancy. Activating Downtown Beyond Daytime Hours: Breakfast to Bar A long-standing challenge for downtown Lansing has been its lack of evening and weekend activity. Without regular ċĺĺťϙťŘÍƯĖèϠϙťēôϙÍŘôÍϙèÍIJϙċôôīϙôıŕťƅϟϙ“ēôϙaÍèĺťťÍϙīŪæϙĖIJťŘĺîŪèôŜϙÍϙîƅIJÍıĖèϙċĺĺîϙèŪīťŪŘôϙÍIJîϙČÍťēôŘĖIJČϙŜŕÍèôϙťēÍťϙ brings energy beyond the 9-to-5. x ĺĺŜťŜϙ>ĺĺťϙ“ŘÍƯĖèϙċĺŘϙ‡ôťÍĖīϙЭϙ(IJťôŘťÍĖIJıôIJť – More people downtown after hours means more support for shops, theaters, and events. x Creates a Walkable, Engaging District –
ϙîĖŽôŘŜôϙıĖƄϙĺċϙîĖIJĖIJČϙÍIJîϙôIJťôŘťÍĖIJıôIJťϙċĺŜťôŘŜϙÍϙlively, safe, and accessible environment. x Supports Evolving Dining Habits – As work patterns shift, The Macotta Club embraces new restaurant models, catering to both residents and visitors. Building Community & Downtown Identity The Macotta Club shapes Lansing’s future and strengthening its identity. x A Culinary Destination – Positions downtown as a hub for food innovation, drawing visitors and encouraging repeat visits. x A Space for Everyone – Supports diverse chefs and entrepreneurs, promoting economic inclusion and cultural vibrancy. x A Source of Civic Pride – ®ÍťèēĖIJČϙīĺèÍīϙæŪŜĖIJôŜŜôŜϙťēŘĖŽôϙċĺŜťôŘŜϙôƄèĖťôıôIJťϠϙôIJČÍČôıôIJťϠϙÍIJîϙċŪŘťēôŘϙ investment in our city. A Proven Strategy for Retention & Recruitment A strong food culture is a key driver of economic development. x Attracting Business & Investment – Studies show food-centric businesses drive downtown revitalization and attract new visitors. x Fostering a Skilled Workforce – “ŘÍĖIJĖIJČϠϙıôIJťĺŘŜēĖŕϠϙÍIJîϙèôŘťĖƱèÍťĖĺIJϙŕŘĺČŘÍıŜϙēôīŕϙīĺèÍīϙŘôŜťÍŪŘÍIJťŜϙ stay open and thrive by hiring and retaining top talent. x Showcasing Local Flavors – “ēôϙaÍèĺťťÍϙīŪæϙÍıŕīĖƱôŜϙ[ÍIJŜĖIJČЍŜϙċĺĺîϙŜèôIJôϠϙČĖŽĖIJČϙôIJťŘôŕŘôIJôŪŘŜϙÍϙ ŕīÍťċĺŘıϙťĺϙôƄŕÍIJîϙŜĖČIJÍťŪŘôϙŕŘĺîŪèťŜϟ The Time to Invest is Now The Macotta Club is more than a project—it’s a strategic investment in long-ťôŘıϙôèĺIJĺıĖèϙŘôŜĖīĖôIJèôϟϙIťϙƱīīŜϙ vacancies, supports small businesses, and fuels downtown’s transformation. Now is the time for bold ideas that shape our city’s future. This accelerator won’t just occupy a keystone space—it ſĖīīϙîôƱIJôϙÍϙıĺŽôıôIJťϠϙŕŘĺŽĖIJČϙťēÍťϙ[ÍIJŜĖIJČЍŜϙæôŜťϙîÍƅŜϙÍŘôϙÍēôÍîϟ By leading the charge in downtown revitalization, The Macotta Club positions Lansing as a Midwest leader in the culinary scene and a hub for economic innovation. Potential Saleable Value in 5-10 Years The following estimates are based upon The Macotta Club’s current models. Since the property is leased, valuation îôŕôIJîŜϙĺIJϙŘôŽôIJŪôϠϙŕŘĺƱťÍæĖīĖťƅϠϙÍIJîϙīôÍŜôϙÍťťŘÍèťĖŽôIJôŜŜϙŘÍťēôŘϙťēÍIJϙīÍIJîϙÍŕŕŘôèĖÍťĖĺIJϟ Valuation Methods A. EBITDA or Revenue Multiple x Restaurant incubators typically sell for 4-8x EBITDA. (ôÍŘIJĖIJČŜϙæôċĺŘôϙĖIJťôŘôŜťϠϙťÍƄôŜϠϙîôŕŘôèĖÍťĖĺIJϠϙÍIJîϙ amortization) x If the accelerator generates $1.5M - $2.5M in EBITDA annually, potential valuation: x 5 years: $6M - $20M x 10 years: $10M - $30M B. Discounted Cash Flow (DCF) Method x ÍŜôîϙĺIJϙŕŘĺĤôèťôîϙèÍŜēϙƲĺſϙċŘĺıϙŘôIJťÍīŜϠϙıôıæôŘŜēĖŕŜϠϙôŽôIJťŜϠϙÍIJîϙŕÍŘťIJôŘŜēĖŕŜϟ x IċϙÍIJIJŪÍīϙIJôťϙèÍŜēϙƲĺſϙČŘĺſŜϙÍť 5-10% per year, estimated value in 10 years: $10M - $25M. x Scalability or acquisition by a larger operator could increase valuation beyond standard multiples. Final Saleable Value Estimates (Leased Space Model) Timeframe Low Estimate (4x EBITDA) High Estimate (8x EBITDA / Growth-Based) 5 Years $6M - $10M $12M - $20M 10 Years $10M - $15M $20M - $30M  MACOTTA CLUB STATUS UPDATE (3/4/25) General Contractor x On February 11th, Wieland and Wolverine (each a “General Contractor” or “GC”) presented their initial proposals to the Macotta Club project team. Each GC was subsequently asked to conduct value ôIJČĖIJôôŘĖIJČϙ ϼЊ«(ЋϽϙ ťĺϙ èŪťϙ èĺŜťŜϙ ĖIJϙ ťēôĖŘϙ ŘôŜŕôèťĖŽôϙ æŪîČôťŜϙ ſĖťēϙ ŪŕîÍťôîϙ ŕŘĺŕĺŜÍīŜϙ îŪôϙ ċĺŘϙ ƱIJÍīϙ consideration by February 21st. Below is a summary of relevant considerations for each GC. o WOLVERINE: $5,340,169* ($5,509,677.45 after additional expenses are included) ƒ Estimate includes a $25,000 Unforeseen Conditions Allowance as well as division-ŜŕôèĖƱèϙ allowance of $35,500. Wolverine also recommends that Macotta Club “carry contingency between 5%-7% of project costs.” This would constitute an additional $267,008.45-$373,811.83. Adding a 5% contingency raises the total project cost to $5,607,177.45. Note that we recommend a contingency be included in the total project cost both for purposes of comparing Wolverine to Wieland (because Wieland includes a total project contingency) and also because it is best practice to wrap these contingencies into the contract. ƒ IIJϙ ÍîîĖťĖĺIJϙ ťĺϙ ťēôϙ «(ϙ ĖIJèĺŘŕĺŘÍťôîϙ ĖIJťĺϙ ťēôϙ ƱIJÍīϙ ôŜťĖıÍťôϠϙ ®ĺīŽôŘĖIJôϙ ŕŘĺŽĖîôîϙ ÍîîĖťĖĺIJÍīϙ ϼıĺŘôϙ aggressive) VE recommendations. Even incorporating such recommendations, the Wolverine estimate (with the 5% contingency added) would total $5,509,677.45. ƒ Wolverine held its fee at 5% in all proposals. ƒ In its initial proposal presentation, Wolverine indicated that numerous subcontractors and Wolverine personnel would be traveling from the west side of Michigan. This means increased travel expenses. o WIELAND: $5,352,715 ƒ Estimate incorporates a 3% Construction Contingency and division-ŜŕôèĖƱèϙÍīīĺſÍIJèôŜϟϙ ƒ Wieland’s proposed contract provides for robust transparency via access to the digital project management platform. The platform includes subcontractor invoices, project timeline, and more. ƒ Wieland is willing to enter a hybrid contract that includes the potential cost-ŜÍŽĖIJČŜϙæôIJôƱťŜϙĺċϙÍϙ cost-plus contract with the security of a guaranteed maximum price. ƒ Wieland reduced its total construction fee from 5% to 4%. ƒ Wieland has demonstrated superior reliability and professionalism in the bidding process. Their presentation was polished, their budget was thorough, and their response time was ôƯĖèĖôIJťϟϙ Moreover, Wieland has routinely emphasized their desire to be involved in this project. x RECOMMENDATION: Based on the foregoing, we believe it is in the best interest of the Macotta Club to move forward with Wieland as the project’s GC. IIJϙ ÍîîĖťĖĺIJϙ ťĺϙ ĺƯôŘĖIJČϙ ťēôϙ īĺſôŘϙ æĖî, in our opinion ®ĖôīÍIJîЍŜϙ ŕŘĺċôŜŜĖĺIJÍīĖŜıϠϙ ťŘÍIJŜŕÍŘôIJèƅϠϙ ÍIJîϙ èĺIJťŘÍèťϙ ƲôƄĖæĖīĖťƅϙ will better serve the Macotta Club’s needs. x AIJϙÍîîĖťĖĺIJÍīϙŜťÍƯϙıôıæôŘϙĖŜϙadvised to assist your current team with project management and partner communication during the 7+month construction phase. Contracts x In IJôČĺťĖÍťĖIJČϙťēôϙƱIJÍīϙ@ϙèĺIJťŘÍèťϠϙÍīīϙŘôŗŪĖŘôıôIJťŜ imposed by the Macotta Club’s funding sources will be incorporated, including but not limited to: Davis-Bacon language, Guaranteed Maximum Price, rights for our construction consultant (Mike Stolz), and change-order guidelines. x Because Eyde is no longer the GC, what was formerly the Lease and Development Agreement must be amended to remove the “Development” portion (the “Amendment”). The Amendment also rôƲôèťs all  other negotiations since execution of the original Lease and Development Agreement in 2023. The Amendment’s key terms are summarized below. o “ēôϙ ĺŽôŘÍīīϙ ŜŗŪÍŘôϙ ċĺĺťÍČôϙ ĺċϙ ťēôϙ aÍèĺťťÍϙ īŪæϙ ēÍŜϙ æôôIJϙ ĖIJèŘôÍŜôîϙ ťĺϙ ŘôƲôèťϙ ťēôϙ ÍîîĖťĖĺIJϙ ĺċϙ ťēôϙ elevator access space. The rentable square footage increased from 22,802 to 23,194 (+390 square feet). This results in a total rent increase of $12,149.54 for the initial 5-year term (was $840,242.75, now $852,392.29). o The obligation to pay “Additional Rent” originally began on February 15, 2024. Under the Amendment, Additional Rent costs begin tolling on January 1, 2025. Factoring in the $30,091.43 rent credit, Additional Rent obligations for the remainder of 2025 are as follows: Commencing Ending Additional Rent Rent Credit Remaining Amount Due 1/1/2025 1/31/2025 $5,353.49 $24,737.94 $0.00 2/1/2025 2/28/2025 $5,353.49 $19,384.45 $0.00 3/1/2025 3/31/2025 $5,353.49 $14,030.96 $0.00 4/1/2025 4/30/2025 $5,353.49 $8,677.47 $0.00 5/1/2025 5/31/2025 $5,353.49 $3,323.98 $0.00 6/1/2025 6/30/2025 $5,353.49 $0.00 $2,029.51 7/1/2025 7/30/2025 $5,353.49 $0.00 $5,353.49 8/1/2025 8/31/2025 $5,353.49 $0.00 $5,353.49 9/1/2025 9/30/2025 $5,353.49 $0.00 $5,353.49 10/1/2025 10/31/2025 $5,353.49 $0.00 $5,353.49 11/1/2025 11/30/2025 $5,353.49 $0.00 $5,353.49 12/1/2025 12/31/2025 $5,353.49 $0.00 $5,353.49 o While Eyde will no longer serve as the project’s GC, the Macotta Club will pay a 2% fee to Eyde’s “Landlord Construction Representative.” This role is necessary to ensure all work at the premises is compliant with the building’s restrictions and historical preservation requirements. o The original $1,300,000 deposit paid to Eyde will be refunded as set forth in the table below. Original Deposit $1,300,000 Landlord Construction Representative Fee $100,000 (initially based on a $5,000,000 project estimate at Eyde’s requested 2% – to be reconciled upon completion of the project) T.H. Eifert Deposit $150,000 Total Refund $1,050,000 Permitting & Timeline x The City has required all plumbing to be rerouted to the kitchen’s grease interceptors. Plans are being ÍîĤŪŜťôîϙ ťĺϙ ŘôƲôèťϙ ťēĖŜϙ ŘôŗŪĖŘôıôIJť. The City indicated its intent to approve such revised plans upon receipt. Plans are set to be submitted by ťēôϙƱŘŜťϙſôôħϙĺċϙaÍŘèēϟ x Construction is estimated to take 7-9 months. Assuming a March ground-breaking, the Macotta Club is slated to open late Fall 2025. Next Steps x T.H. Eifert (“Eifert”) was the only subcontractor to be partially paid and begin work prior to Eyde’s choice to outsource the GC role. On March 3rd, the Macotta Club project team met with Eifert to review its bid. In the meeting, limited opportunities for additional cost-saving measures exist, and overall Eifert wasn’t willing to provide line item estimates, so alternative solutions may be considered. x iIJèôϙÍϙ@ϙĖŜϙƱIJÍīĖƏôî and approved by the Board, the Macotta Club project team – including the GC and all major subcontractors – will meet to identify ƱIJÍī VE opportunities. bĺϙÍîîĖťĖĺIJÍīϙæĖîîĖIJČϙÍIJîϙŜŕôèĖƱèϙ  estimates for sub-contracted work outside of Studio Intrigue and Boelter’s work can take place without securing a GC. The need to implement cost saving measures will be prioritized with the understanding that a minimum reduction of Macotta Club overall construction costs need to be reduced by an estimated $1,000,000.00, or additional funding sources to meet that $1,000,000 request is necessary for consideration by MCC for a loan. Additional Revenue Sources C. Edgerly has been continuing to work on the Capital Stack for Macotta Club. To date, we have the following : Funding Secured: RAP Grant funding: $1.5M State of Michigan Enhancement Grant: $1.5M City of Lansing Grant Funds: $15,000 Consumers Energy Foundation: $100,000 Lake Trust Credit Union: $375,000 ($75,000 annually for 5 years) Capital Region Community Foundation: $100,000 ($50,000 annually once construction is complete) TOTAL Secured: $3,590,000 In Process/Applied for: Hartford Main Street America Grant: $100,000 TRUIST Grant: $1,000,000 Jackson National Life Grant: $250,000 Lake Trust Credit Union: $1,500,000 Michigan Community Capital: $3,500,000 State of Michigan addt’l funding: $1,000,000 TOTAL In Process : $7,350,000
ťϙťēĖŜϙťĖıôϠϙ"[IϙŜťÍƯϙĖŜϙèĺIJƱîôIJťϙſôϙèÍIJϙťŘim $500,000 in costs prior to any sub-contractors and additional cost anÍīƅŜĖŜϙſĖťēϙ@ϠϙƱIJĖŜēôŜϠϙŕīŪıæĖIJČϙÍIJîϙôīôèťŘĖèϟϙ  DL3I General Fund -DQXDU\)LQDQFLDOV Suggested budget amendments for FY December Year to Date Budget 2025 Balance from end of December $67,392.32 Ordinary Income/Expense Income Sponsorships 100,000.00 139,000.00 5,000.00 150,000 Transfers-In 1,200.00 44,428.33 25,000.00 50,000 Fudiciary Income 0.00 2,250.00 5,000.00 Ticket/Merch Sales 200.00 200.00 1,500.00 Misc 0.00 500.00 TOTAL INCOME 101,400.00 185,878.33 37,000.00 Expense Sponsorships 700.00 1,700.00 2,000.00 2500 Transfers Out 1,408.28 39,683.67 25,000.00 50,000 Fudiciary Expenses 12,000.00 14,650.00 5,000.00 Fees/Charges 2,447.50 1,500.00 5000 Misc 151.20 5,536.40 3,500.00 7500 TOTAL EXPENSE 14,259.48 64,017.57 37,000.00 DLPI Net Balance 154,532.84 121,860.76 0.00  DLI General Fund Statement of Activity Suggested budget May 2022 amendments for FY February Year to Date Budget 2025 Balance from end of December $154,532.85 Ordinary Income/Expense Income Sponsorships 0.00 139,000.00 5,000.00 150,000 Transfers-In 0.00 44,428.33 25,000.00 50,000 Fudiciary Income 0.00 2,250.00 5,000.00 Ticket/Merch Sales 0.00 200.00 1,500.00 Misc 0.00 500.00 TOTAL INCOME 0.00 185,878.33 37,000.00 Expense Sponsorships 0.00 1,700.00 2,000.00 2500 Transfers Out 0.00 39,683.67 25,000.00 50,000 Fudiciary Expenses 0.00 14,650.00 5,000.00 Fees/Charges 0.00 2,447.50 1,500.00 5000 Misc 147.50 5,536.40 3,500.00 7500 TOTAL EXPENSE 147.50 64,017.57 37,000.00 DLPI Net Balance 154,385.35 121,860.76 0.00