Food Hub Filling Up
By Bill Palladino
This story was originally published in the February 2016 Issue of Traverse City Business News.
Early most Monday mornings there’s a delightful aroma emanating from suite 108 at the Grand Traverse Food Innovation Hub (GTFA). It tells us that Courtney Lorenz is busy in the kitchen brewing up something special. Her business, Cultured Ferments, occupies two small rooms inside this building at 1610 Barlow in Traverse City.
In one of the rooms sits nine 60-gallon plastic fermenting tanks, each holding a waxy substance that completely covers the contents. Each of her “babies,” these are known as scobies, makes up a symbiotic colony of bacteria and yeast that turns a simple mixture of water, tea and sugar into a delicious and nourishing effervescent drink known as kombucha.
Until moving into the food innovation hub, Cultured Ferments could only sell their kombucha under “cottage food” regulations that restricted sales to farmers markets. In the seven months since moving into the hub, Lorenz has grown her business substantially and received certification from the Michigan Department of Agriculture for the retail sale of her products.
“I’ve expanded from 15 gallons to 540 gallons of production capacity,” she said.
Cultured Ferments is now available in retail stores across the region and they’ve just signed a distribution deal with Cherry Capital Foods. “I couldn’t have done this without the support, community, and foundation provided by the food innovation hub,” she said.
This facility is the first food infrastructure project of the Grand Traverse Foodshed Alliance (GTFA), a nonprofit organization dedicated to creating food infrastructure investments for northwest Michigan. With nine suites available for rent ranging in size from 380 to 1,600 square feet, the food innovation hub provides below-market rent to qualifying food businesses, along with access to a menu of support services. The “white-boxed” suites are already prepped for the strict requirements of the food industry.
“Most importantly for food entrepreneurs, rents are well below market rates. Leases start at just $5 per square foot per year,” Rob Sirrine, chair of the GTFA board explained.
That compares to other commercial spaces renting for $10 to $20 per square foot. This price break is designed to allow new and expanding local food businesses to use their capital for equipment, build-out and inventory, rather than rent.
“This takes some of the burden of growth off the shoulders of tenants and gives them a chance to get a head start on their business model,” said Sirrine.
Other tenants occupying suites or pending build-out inside the 12,000 square feet of space include: As You Dish, Fab Fresh Foods, the Michigan Hop Alliance, WhiskTC, the Big Dipper Dough Company, The Two Vals, and The Redheads. All these tenants share a desire to grow and expand their local food-based businesses but have met obstacles along the way that the food innovation hub is designed to mitigate.
The food innovation hub and its business-friendly leasing arrangement are due to the work of the GTFA, which partnered with Cherry Capital Foods, MSU Extension, Networks Northwest and the Michigan Department of Agriculture and Rural Development and others on the project. The entire facility and its philosophy are designed to accelerate the growth of local food businesses and make lasting impacts on the regional economy.
The unique design of the partnership offers an opportunity for food businesses to take advantage of the warehousing and distribution resources of Cherry Capital Foods (CCF), which is co-located in the same building. Through an arrangement, food innovation hub tenants can use CCF’s vast cooler, freezer, and dry storage capacity. These services are available just a few steps away from tenant suites.
Food innovation hub tenants can also access business counseling and support services through relationships with the MSU Product Center, SCORE, SBDC, Taste the Local Difference, Venture North, lending institutions, and other business services. The facility includes a large gathering space, conference room and classroom. These are used to host meetings, events and gatherings sponsored by partners and are available at no charge to tenants.
Back in suite 108, after Courtney Lorenz finishes bottling a batch of kombucha, she can often be found relaxing with a cup of tea or catching up on email in the food innovation hub lounge area. She’s convinced moving to the food innovation hub was the right choice.
“Being involved with this organization allows any small business to tap into new markets through retail sales, potential distribution partnerships, and local small business resources,” she said. “As a community member, entrepreneur, and locavore (one who eats foods grown locally whenever possible), I couldn’t be happier with the opportunities that the food hub is providing our local food economy.
There are only a few spaces remaining at the Grand Traverse Food Innovation Hub. To find out more, visit gtfoodshedalliance.org.
Bill Palladino is director of Taste the Local Difference®, a social enterprise of the Groundwork Center for Resilient Communities, and is the facility manager for the Grand Traverse Food Innovation Hub.