Eastern Market entrepreneur Sanford Nelson insists he’s not area's villain
Detroit — Sanford Nelson has a dog who's clearly fond of him. Does that help?
Chili is a year-old Australian shepherd mix, sandy-haired and adorable. She and the newest candidate for most disliked man in Detroit like to take walks together around Eastern Market.
Nelson and Chili will pass the Russell Street Deli, where the young land baron's most visible tenant has publicly called him a bully and a sneak. Pass 16 more buildings he and his father have already purchased and some others they still might. Pass the empty storefronts where businesses have left or are leaving and the lofts where he raised rents.
"People out there are saying I want to demolish everything and build strip malls," says Nelson, 30, a few days after an online columnist asked him to please stop being such a schmuck. Not so, he insists: "I want to build on Eastern Market and support what's here."
Plus, he always cleans up Chili's messes. Does that make him any less a villain?
Truth is, if Nelson and his dad, Linden, had never done anything at Eastern Market besides buy vegetables, it would still be changing.
The butcher he supposedly drove out of existence, Adams Meats, closed six months before he took over its building, and the owner of the defunct Mootown Ice Cream & Dessert Shoppe says he did her a huge favor when he let her out of her lease.
One of the properties he plans to renovate had been so studiously neglected across the decades that the smoke detectors were fake.
Oh, and he says he has already flatly rejected offers from national restaurant chains.
That's the fear: a born-rich son and a free-spending father from Bloomfield Hills will invite Starbucks and P.F. Chang's into a beloved haven for entrepreneurs, artists and the work-booted, hard-hatted companies that wholesale or process food.
Other developers have also bought into the market, among them former Detroit Economic Growth Corporation director George Jackson and ASH NYC, the New York group that created the Siren Hotel. But the Nelsons control enough real estate to potentially control the makeup of one of Detroit's most beloved destinations — Sanford without a track record, and Linden with a sometimes problematic one.
Sanford lost the public relations war with Russell Street Deli before he knew he was in it. The issue was who would pay for a $50,000 floor repair. Deli owner Ben Hall announced he would be closing the doors Sept. 28, and the landlord was in the soup.
"I told him, 'We have a tremendous amount of goodwill. We're willing to extend it to you because you already have a problem,'" Hall says. "He doesn't know how to effectively have a business relationship."
Nelson suggests that Hall, who also owns a growing packaged food company, wanted an excuse to leave. More publicly, he blamed the problem on Hall's leaky equipment.
Ultimately, Nelson looked like a guy who spent $30 million on buildings and begrudged a simple $50,000.
"Ben Hall is an angel sent by God," Nelson says, "and I'm the devil incarnate."
But Eastern Market Antiques will be closing around the same time as the deli, and one of the vendors there greeted Nelson like a favorite nephew last week. Nelson says he caught a troupe of actors living in a theater space that wasn't zoned for it, and he let them stay rent-free until they found somewhere to land even though they stopped paying the utilities. He says his FIRM Real Estate is more than 50 percent minority-backed.
"I take responsibility for not communicating properly in some instances," says Nelson, as he strolls the market in a light rain. That's sort of an apology, or at least an acknowledgment that people want more than vague assurances when new faces start sprinkling checks.
"Have I made mistakes? Absolutely," he says later over a Diet Coke at Vivio's, in a building he does not own. That's more of an apology and an acknowledgement that maybe he could have prevented some of the hostility that put him in memes and on a banner and in the Deadline Detroit column that used the colloquial term for a male body part.
The column he at least found "comical." The most recent meme, where he's standing proudly in front of awnings for Pizza Hut, Baskin-Robbins, Panera and Subway, he can dismiss. The banner on the Eastern Market water tower that said "Something's rotten in Nel$onville" misspelled Linden.
Some of the other jabs landed. "I'm a human being," he says. "The things being said about me are hurtful."
But then it's back to business.
"I can't take up capacity in my brain speculating why people feel the way they do," he says. "I have work to do."
Which is what some people are wary of. If he's not resented for what he's done, it's for what he might do.
CHANGE, TACT NEEDED
Ronnie was his dad. The Bedways started with 24 feet of counter space, hung on through two devastating fires that closed the market and kept expanding. Six years ago, Tom Bedway bought the building.
He knew the owner was thinking of cashing out, and "I didn't want someone who didn't share the vision I had to come break it up," Bedway says. "I didn't want someone to come in and run the little people out of here."
If that sounds like a stance against change — or the Nelsons — it's neither. Bedway needs only a short stroll down memory lane to recall when the sheds that house the Saturday farmers markets weren't covered and weren't particularly clean. Sometimes, change is good.
So is tact, though.
"They're buying from people who are ready to move on," Bedway points out, "but they've come in just a little aggressive. I know you've invested a lot of money, but a property owner is only as good as his tenants."
Dan Carmody, president of the nonprofit Eastern Market Corp., says the 128-year-old market has been oddly blessed by Detroit's stagnant commercial real estate scene — but those days are history.
Across half a century, similar districts in New York, Washington, D.C., and Chicago were gradually snapped up and redirected.
Here, Carmody says, from Gratiot to Mack and I-75 to St. Aubin, there was minimal turnover. In some cases, there was also minimal maintenance, a problem when new owners have to pay for repairs and upgrades.
Rents rise. Tenants get displaced during construction. New owners plot out new purposes or new buildings.
The Nelsons began investing in 2017. Two years before that, Carmody says, "you could see the tide turning."
"Our strategy is all about what we can do to keep our soul," he says. "We need to be a place that's still about food, a place where everyone is welcome regardless of their income, and a place where people go to start or grow their independent small business."
A smattering of empty buildings stand amid Eastern Market's 130 acres. A few will be built up, others torn down.
An expansion of 100 acres to the north and northeast will be home to wholesalers and processors, some fresh in the area and some relocated from the original market because recent food safety regulations make their former homes unsuitable.
Across 10 or 15 years, Carmody says, some of the plants left empty will be turned into something else.
He worries about what they will become. Conversely, he worries about "a narrative sometimes that says everything will lose its character."
Time, and developers, will tell.
ELEMENT OF SPIN
Sanford Nelson is on the move, headed northwest on Market Street.
He's been described by several merchants as a blue jeans guy. Today, the jeans are gray, as is his sweater. His jacket, worn open, is dark gray. The building he's pointing to is brown.
He wants a butcher shop at street level, he says. Above it will be art studios priced at $200 a month.
"People ask how we're going to do it," he says. "We're just going to. We have the portfolio to make it happen."
There's a difference, of course, between an arts community that grows organically and one that's preserved like a museum exhibit in special spaces. But there's also a difference between studios and no studios — and between Jose's Tacos and Taco Bell.
Jose's Tacos is a 20-seat restaurant downtown run by Mexican immigrants Jose and Leticia Orozco and their three grown kids.
Nelson, who has lived near Grand Circus Park for five years, is a regular.
That's important, Nelson says. He lives in the city and votes there and pays Detroit insurance rates on the black 2017 Chevy Tahoe that largely serves as his office.
What's important to the Orozcos is that he invited them to open a second location in the building on Market that housed a hydroponic gardening store. Two other restaurants will share the space, he says; though he offers no details, there are murmurs about fish and chips for one and hot dogs for the other.
"Why would I deal with Chipotle," he asks, "when I can deal with the Orozco family? It's exciting for us to help a family like that realize their dream."
There's an element of spin to that, of course — but also a very strong element of good tacos. And he definitely helped Gavrill Fermanis' family achieve what it wanted, which was to hang up its collective apron.
Fermanis-owned Farmers Restaurant and three adjoining buildings, listed for $6.5 million. Nelson finalized his purchase for a price he won't specify on March 5, a Tuesday, and on Wednesday morning a hand-lettered sign was taped to the diner's window:
"Thank you Detroit & Eastern Market for the many wonderful years of business. We have retired! God bless everyone!"
Nelson was sorry to see them go. He liked their sausage.
BUSINESS PEAKS, VALLEYS
The Nelsons' Eastern Market empire stands on a foundation of key fobs.
Linden Nelson owned an advertising specialties company in the 1980s when he sold Ford on the notion of detachable key rings for parking valets.
The idea took off, and so did his business. He made promotional items for the likes of AT&T and Harley-Davidson, and he made money by the boxcar load — enough that when his 23,000-square-foot lakefront home in Bloomfield Hills burned to the ground in July 2009, destroying various artworks and exotic cars, Crain's Detroit Business reported the eventual insurance settlement as $21 million. Investigators never identified a cause for the fire.
There have been peaks since, as well as valleys, some of them in the Rockies.
Nelson bought high-profile properties in Aspen, Colorado, and lost several to foreclosure. He was arrested for disorderly conduct there after he parked in a fire lane outside a grocery store and his car was booted.
He was the driving force behind a mammoth motion picture studio in Pontiac that failed when Gov. Rick Snyder did away with tax incentives for filmmakers. While he and principal partner Al Taubman had little cash in the deal, state employee pension funds wound up on the hook for an $18 million municipal bond.
"He's a forceful personality who will push forward anything he's working on with utmost vigor," says Ken Droz, a former communications manager for the Michigan Film Office.
If "some might call it bluster," Droz says, "I would just say he's really focused on the objective at hand."
The objective nowadays is real estate, particularly but not exclusively in Eastern Market.
As Sanford explains their arrangement, he is president of FIRM and his father is an investor. Also on the investor list, along with others unnamed: Larry Mongo of Cafe d'Mongo's Speakeasy, Don Foss of Credit Acceptance and developer Marvin Beatty.
The president identifies opportunities and brings them to the investors. Properties are pursued or passed over.
Sanford is the public face, the one with the cigar in it.
SAVVY OR SCHMUCK
It's an unfortunate photo to have been plucked from Twitter.
Sanford vacationed in Cuba last spring. He bought a straw hat from a vendor on the beach, put sunglasses on his wide face, stuck a large unlit cigar in his mouth and took a selfie. The cigar juts straight out like the cannon on a tank, and to anyone who wants to think he's a smug dilettante on a spending spree, it comes across as visual proof.
Even Hall, his adversary from Russell Street Deli, feels badly about it. "I'm sorry that photo exists," he says.
Nelson shrugs. He likes fedoras. He likes cigars, in moderation. He also likes to cook and ride his bike, and he collects ashtrays and matchbooks.
"He has a creative touch," says his friend Jeremy Sasson, 35, founder of the restaurant group that owns Townhouse and Prime & Proper.
Nelson enjoys being around people, Sasson says, but he's also "the guy I will find in the most random eatery in the most random place by himself. He'll be at the Dearborn Meat Market, in the back at one of the four tables."
He did not, for the record, grow up wanting to be a real estate developer. He was a serial entrepreneur, dealing in yo-yos or Pogs or whatever else was big in the schoolyard, but thanks to "Rocky," he wanted to be a boxer. The back-up plan was Formula One driver.
Later, he and two other University of Michigan students appeared on "Shark Tank," pitching a phone app called Magic Moments that sped photos onto coffee mugs and T-shirts. They wanted an ambitious $500,000 for 15 percent of the company. The sharks declined, and the app's website is inactive.
The Nelsons helped produce a horror movie, "Eloise," released in early 2017; its run was limited, and the reviews were not kind.
Now they're in Eastern Market, where Linden went to a long-gone deli with his dad and to Rocky Peanut Co. and R. Hirt with his kids.
The retail end of R. Hirt is now called DeVries & Co. Manager Megan Lewis, 36, owned the Mootown ice cream parlor, and she says Nelson has been "very friendly to me. Above and beyond."
Her lease had three years left and was personally guaranteed, "and I let her out of it," Nelson says. "Find me another landlord in town who'd do that."
He's wandering again, pointing toward certain buildings with a future and others with an expiration date. The one with an exuberant mural across the face is too decayed to save, but he promises an "an interesting twist on historic preservation" and a creative way to rescue the artwork.
Bert's Warehouse will move and shrink; the Nelsons own the entire 3.3-acre block, and a labyrinthine entertainment complex fronting Russell Street doesn't fit the master plan.
"I think it's great," says Bert Dearing, 75. "They have a vision."
As their vision unfolds, Nelson says, there will be glass in a market build on brick. If all the projects that all the developers have talked about come to pass, there will be 1,600 housing units, more than 10 times what's on site now.
Eastern Market will look different. Feel different. Smell different.
Give it time, Nelson says. He owns buildings more than a century old. Check back in 2119 and see how his new ones fit with those.
See if he was savvy, or even a savior. Or a schmuck.