Waséyabek Development Company, LLC, President & CEO, Deidra Mitchell, was recently invited by MiBiz to participate in a roundtable composed of mergers and acquisition experts across the state.

Learn what Ms. Mitchell and the panel had to say about valuations, tax & policy changes, and other factors impacting the future of acquisitions in a “post-pandemic” world:

 MiBiz roundtable: M&A experts forecast strong deal flow in post-pandemic rebound. 

The seeds for the joint purchase of the iconic McKay Tower building in downtown Grand Rapids took root years ago when the CEOs at Waséyabek Development Co. LLC and Gun Lake Investments started talking about doing deals together. 

Gun Lake Investments CEO Kurtis Trevan and Waséyabek President and CEO Deidra Mitchell both started in their respective non-gaming tribal economic development roles at about the same time, and both also planted their companies’ headquarters in downtown Grand Rapids.

Along with economic development leaders from other American Indian tribes across West Michigan, Trevan and Mitchell began to meet on a quarterly basis to build inter-tribal relationships and share collective experiences. Over time, a common theme emerged. 

“We’d talked for years about how tribes should be partnering with each other and how it doesn’t happen as frequently as it should,” said Trevan, a citizen of the Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians, or Gun Lake Tribe. 

Trevan got word through a relationship with a broker that the Borisch family’s Steadfast Property Holdings planned to put McKay Tower on the market, and immediately took an interest in the commercial property. Initially, he planned to pursue the transaction solely for Gun Lake Investments, with the tribal entity taking on “some level of debt” to finance the purchase. 

“Before we moved too far with that conversation, we thought, ‘This feels like it could be a really good transaction to partner on with Waséyabek,’” Trevan said, noting his familiarity with the firm’s investment strategy and governance. 

His instincts proved correct.

“Kurt called and we talked about it, and I said, ‘That’s perfect — that would be a great co-acquisition,’” said Mitchell, whose firm serves as the non-gaming economic development arm of the Nottawaseppi Huron Band of Potawatomi. “Like any strong relationship, it requires a lot of communication up front about how we’re going to manage the building and what the expectations are for making improvements and returns. It makes it a little more complicated, but that’s true of any partner that you go into business with.”

The two firms worked together on due diligence and ended up closing on the $17.5 million transaction on Jan. 13, 2020. Because of their similar governance structures, they were able to negotiate the transaction at the management team level, which is notable in Indian Country where many economic development firms require tribal governments to sign off on projects. 

Gun Lake Investments and Waséyabek split the cost evenly and share 50-50 ownership of the 18-story, 154,000-square-foot building at 146 Monroe Center St. in the heart of the downtown business district.

The joint acquisition was selected as the winner in the real estate category of the 2021 MiBiz Deals of the Year Awards.

To run the building, Trevan suggested a governance structure modeled after best practices from family owned business enterprises by creating a three-person board with a seat for each of the tribally owned firms and an independent third-party member. The partners recruited Scott Spoelhof from Holland-based Bayside Capital Management LLC to fill out the board. 

“With large buildings like McKay, there’s maintenance, capex and other improvements that we need to invest in to make sure the building remains in great shape, and those things cost a lot of money,” Trevan said. “You need to balance how does that fit within your strategies — and we have two distinct sets of strategies between GLI and Waséyabek — and ultimately what are your key stakeholders expecting? 

“We needed to have somebody with some independence who’s going to see things with a different perspective and help us elevate out of the weeds a bit. It’s really provided a lot of clarity around how we plan for this in a way that we can all be aligned.” 

Similarly, GLI and Waséyabek opted to work with a property management firm that aligned with their values and could deal with the day-to-day operations, ultimately selecting Grand Rapids-based Rockford Construction Co. Inc. for that role. 

“Neither Kurt nor I had heavy experience in commercial real estate, so their experience across the industry has been very, very helpful,” Mitchell said. 

In particular, Trevan cited Rockford’s assistance as being a “huge asset” after McKay Tower suffered damage during the social unrest last spring. 

So far, the partners remain bullish on the future of the building and the prospects of continuing to work together. While the pandemic affected the building’s retail tenants most acutely, the commercial and residential space has remained “remarkably stable,” Mitchell said, noting her belief that the iconic building will hold its value for years to come under the tribal stewardship.

“We’re excited to be here and feel extremely blessed to have that trust and relationship with Waséyabek,” Trevan said. “We did something that has happened very few times in Indian Country, so we hope that it serves as a model for what tribes can do together. We can be doing more of that, and I think that’s really important for our tribes and for diversification plans.”

To learn more about the Iconic Mckay Tower please click one the link below.

Mckay Tower in Downtown Grand Rapids

Deidra Mitchell, President & CEO of Waséyabek Development Company, LLC (WDC) was recently named to the Board of Directors for the Literacy Center of West Michigan.  The Literacy Center of West Michigan was founded in 1986 and has been working alongside community members as they improve their reading and language skills.  Their work is deeply grounded in the belief that West Michigan will thrive only when we can access the assets of all its community members.

“I am proud to join other West Michigan leaders on the Board of Directors,” said Mitchell.  “I look forward to collaborating with the Board and the amazing staff and volunteers at the Literacy Center to help them further their important mission that truly benefits everyone in West Michigan.”

Waséyabek Development Company, LLC (WDC) is a 100% Tribally-owned holding company that manages the Nottawaseppi Huron Band of the Potawatomi’s non-gaming economic development activities.  Mitchell became their President & CEO in 2016.  Waséyabek’s mission is to create a diversified economy to support the Tribe’s long-term sustainability and economic self-sufficiency.  This mission aligns with the Literacy Center’s mission of bringing about a just and vibrant West Michigan through the power of literacy.

“We are excited to have Deidra joining our team,” stated Wendy Falb, Executive Director at the Literacy Center.  “Waséyabek has been a great partner of the Literacy Center and we look to build on that partnership with Deidra’s involvement on the Board.”

For more information about the Literacy Center of West Michigan, visit https://literacycenterwm.org/.

As the COVID-19 pandemic first swept across the country and Michigan earlier this year, I looked around our office and wondered, like so many CEOs, what this would mean for us? What will this mean for generations to come?

The lingering economic effects of the virus seemed destined to hit tribal communities hard, just like so many West Michigan businesses. As many of us take time this week to celebrate and give thanks, I ask that you spend the remaining days of Native American Heritage Month recognizing the economic contributions of Michigan’s federally recognized tribes.

For so many tribes, our histories have been marked by resilience and fights for sovereignty. So as the pandemic tossed yet another obstacle in front us, I felt confident the growing strength of tribal nations in the state would overcome this, too. And what many don’t know is that Michigan’s tribal communities have been working on business practices that are diversified and resilient — preparing for the very challenges we’re currently facing.

It’s no secret that tribal nations’ primary revenues are driven by gaming. As the pandemic made it all but certain that gaming opportunities would be closed until deemed safe, our main source of revenue became a question mark. Tribal nations have always known that gaming couldn’t sustain the tribal communities forever and the pandemic was going to test this theory.

That’s why organizations, like Waséyabek Development Company, the nongaming economic wing of the Nottawaseppi Huron Band of Potawatomi Indians, and tribal nations have sought to expand and diversify tribal income streams.

An economic impact study of nine of Michigan’s 12 federally recognized tribes, published earlier this year, measured the successes of nongaming businesses entities owned and operated by the tribes. The study looked at a collective 38 tribal businesses entities, finding they generated an impact of nearly $289 million for the state with just over $24 million in federal and state taxes.

These 38 businesses are scattered across the state, from Wayne County to the Upper Peninsula, with a diversified portfolio of operations. Tribes now do business in utilities, construction, manufacturing, real estate, professional, scientific and technical services, as well as arts and entertainment and finance. These 38 businesses provide 1,847 jobs with an average salary of $45,600.

The impact of the businesses extends to local economies and goes far beyond the lens of gaming that so many see tribes through. These businesses have helped form a sustainable future for tribes and been a backbone during a disruptive pandemic.

Which is why this month, November being Native American Heritage Month, means much more, especially during the pandemic. Our history has been one of resilience and sovereignty. Tribal nations are sovereign within the state of Michigan, meaning tribal members rely on the tribe and its efforts for their well-being.

It also explains why tribal development companies exist — for the purpose of sustaining our community in ways out-of-the-ordinary for many tribes. We have a saying within our walls at Waséyabek Development Company: We don’t make decisions for the next seven years but for the next seven generations.

It’s principles like this from which many tribal nations make decisions. As nations, we want to diversify the opportunities for our tribes and announce to the state we are here, we welcome your business and we’re expanding the notion of what a tribal nation can do.

We do all of this for the betterment of the tribe and as an ode to those who came before us and for the ones who will come after us. It’s at moments like these during the pandemic and during Native American Heritage Month where I think about how far we’ve come, how much work is still left to do and why we do it.

For more information, visit waseyabek.com.