Live Work Play Redefines Lansing Skyline

Live Work Play Building to Redefine Lansing Skyline as Its Tallest Structure

By Dennis Burck

Published July 10, 2020

A 30-plus story mixed-use building is on track to redefine the downtown Lansing skyline. If approved by Lansing City Council, it would be the city’s tallest building.

Owner Live Holdings LLC plans on proposing the “Live Work Play” building to the Lansing City Council in the fourth quarter of 2020. Preliminary plans include office and conference space, private residences, shopping, dining, as well as a Magnifica Hotel and Spa.

Providing funding for the LLC’s development is longtime Lansing business CIG Capital, a project finance firm specializing in alternative lending, infrastructure, real estate, FinTech Technology, oil and gas, bio-medical, software, banking transactions and more. The firm has a dual headquarters in Lansing and Orlando.

“We are looking forward to funding projects in the Michigan area since we have called it home for so many years. It feels great to be a part of revitalizing downtown Lansing and adding to the iconic skyline,” said Charles D. Carey, CIG Capital Managing Partner and owner of Live Holdings LLC.

“Having headquarters in Lansing and Orlando, it only seems fitting that we develop a space for our employees and the community to use,” Carey said. “We believe the Live Work Play model will give CIG Capital employees the ability to have everything at their fingertips.”

With design work well underway with international architect HKS, Carey envisions the building to be two glass towers. “Ideally, the buildings will have vertical farming and sustainable energy capabilities,” he added.

Regionally, greater Lansing is seeing a surge in development. According to data from the Lansing Economic Area Partnership Inc., there was an investment of $3.2 billion among 20 active construction projects in 2019.

“We are thrilled about the funding plans we have in the Michigan area and are looking forward to our future endeavors with Live Holdings, LLC and other companies,” said Josh Leu, Underwriting Director of CIG Capital. “We are looking forward to new opportunities in the up-and-coming downtown Live Work Play building.”

Lansing’s current tallest building, Boji Tower, is 23 stories high.

Providing funding for the development is longtime Lansing business CIG Capital
Providing funding for the development is longtime Lansing business CIG Capital

CIG Capital is an alternative investment firm that possesses a unique model with a complete diverse portfolio. CIG Capital’s portfolio consists of different dynamics such as, Health Care Insurance, Alternative Lending, High Risk Industries, Venture Capital, FinTech, Technology, Bio Medical, Software, infrastructure, oil and gas and real estate projects. Please visit http://www.cigcap.com/ for more information.

Hired as a Prebid Construction News Reporter, Dennis Burck recently joined the team at the Construction Association of Michigan. Burck earned a BA in journalism from Wayne State University in 2017, spending the last two years as a new development and general assignment reporter for the Lansing City Pulse. At the Pulse, Burck was tasked with writing the paper’s “New in Town” column, tracking commercial and city developments from construction to completion. His work also appeared in the Detroit Metro Times, Metro Parent, Model D Media and the National Endowment for the Humanities’ magazine

Mid Year Forecast Recap

Optimism for a V-Shaped Recovery: A Summary of the CAM and HBA Annual Mid-Year Economic Forecast

By Dennis Burck

The CAM/HBA Mid Year Economic Forecast has been providing an annual industry review for ten consecutive years.  While the 2020 gathering had to be done virtually, it was still a much-needed insight into what we may expect from our economy in the coming months.  CAM and HBA were thrilled to welcome Elliot Eisenberg, PhD, as our 2020 economist and guest presenter.  Special thanks to all of our sponsors and participants.

Quick Links

2020 has been a year of many firsts for the construction industry and beyond. This year’s Mid-Year Economic Forecast sees many industries and sectors of the economy showing early signs of V-shape rebounding, followed by projected long-term steady growth to pre-pandemic levels in 2022.

Elliot Eisenberg, chief economist for consulting agency GraphsandLaughs LLC, lead the seminar. Known as the “Bowtie Economist,” his voice has appeared in many publications, including Bloomberg, Business Week, Bureau of National Affairs, Forbes and Fortune. He is also a member of the Expert Advisory Board of Mortgage Market Guide and is a regular consultant to several large real estate professional associations, hedge funds and investment advisory groups.

“What is going on is the following: Our economy is suffering two things at once. We are experiencing a recession, and we are experiencing suppression,” Eisenberg said.

“Suppression is ending, and we are getting a nice beginning of an improvement. There is a mechanical element to this. Just getting out of your house means you are going to spend money. There will be a rapid recovery. But then the recession sets in and the question is how fast will we recover from that?”

Eisenberg supported his forecast threefold with data-driven analysis on GDP growth, inflation and construction from a variety of accredited economic and federal sources.

Lake Michigan Credit Union and Plante Moran generously sponsored the seminar.

How Firms and Lenders Are Navigating the Pandemic

Laura Claeys, a CPA Partner for Plante Moran, said the temporary pause is over and we are seeing many organizations return to work. “Although the economy in Michigan has been slowed by the pandemic, we feel there is pent-up demand in the state,” Claeys said. “Many jobs in the state have been delayed, but not canceled. Optimism in the state remains very high even though the working conditions might be different than we’re used to.”

The pandemic provided organizations the opportunity to access their structure, look at their team and strategy to make them stronger and nimbler to address economic challenges in the future, she added. “We’ve helped many of our clients take that inventory in their organization and found creativity, excitement and plenty of opportunity for them to move forward,” Claeys said.

“Lending institutions are stronger than they were in the last downturn, which I think bodes well for all construction companies and organizations in Michigan. Plante Moran is proud to be in the State of Michigan and serve the construction community.”

As a long-time sponsor of the Mid-Year Economic Forecast, Lake Michigan Credit Union was represented by Chief Lending Executive Eric Burgoon.  “We thought it is important to give you an update for you and your customers that will really help you smoothly work through the closing process with your team since there are some things that changed in our industry,” Burgoon said.

The CARES Act dramatically changed the number of mortgages that are placed in forbearance, the deferment of payments on a mortgage. “Prior to the CARES Act, 0.2 percent of all mortgages nationwide are in forbearance. Now 10 percent are in forbearance. This has really affected the building industry a couple of key ways.” One thing it does is puts into question whether or not someone can purchase or build a home because availability to some lenders has declined, he said.

“This has really created a fear in the industry of escalating foreclosures. This has caused many lenders to dramatically change their underwriting guidelines. Specifically, large banks have created credit overlays or eliminated products completely.” Common changes are higher credit score requirements, higher down payments and higher interest rates on large products. These are things the construction industry must take a second look at now.

“You want to make sure one of your clients building with you that they have preapproval for a mortgage in process to reassess that. Make sure that preapproval is still valid, make sure the lending partner you are working with follows guidelines so when you get to the end of the construction period, it is not a problem,” Burgoon said.

The pandemic hasn’t changed Lake Michigan Credit Union, however.  “We are proud to say we have not changed our products at all. We continue to offer construction financing throughout the shutdown. We still offer our 5 percent down construction loan. We haven’t had any credit overlays or done anything to make getting a mortgage more difficult.”

GDP Growth

Though large sections of the economy were effectively shut down for months to combat the spread of the pandemic, there are enough early indicators to show the first stages of meaningful recovery, according to Eisenberg. “Do not confuse this early recovery with a true ‘V’-shaped recovery. With autos and homebuilding, I think there will be a true ‘V,’ but it will not be everywhere.”

The first sector of the economy to provide the backbone to the forecast was automotive data.

Data from LMC Automotive shows a decent ‘V’ shaped upturn, while JD Power reports it may have new car purchases recover to pre-pandemic levels by August. “Automobiles are relatively like the harbinger of housing because they are a large [purchase] like a house,” he said. “This is a pretty good sign, but temper your enthusiasm.”

Another meaningful metric was restaurant traffic, up much higher since more venues opened up across the county. “I am more optimistic about it and believe the improvement is solid and real. This is a perfect example of suppression ending. This depends on a large extent how we psychologically feel about going to a restaurant.”

Other indicators that showed meaningful growth were manufacturing and hotels.

However, there are still many obstacles to overcome to increase the GDP to pre-pandemic levels. One problem is that firms are hesitant to invest along with a growing number of unknown factors along with the pandemic to consider–a trade deal with China, a second wave of the virus and the U.S. government’s response is pressing. Furthermore, Eisenberg cites publicly traded companies are suspending their dividends or reducing their dividends in levels haven’t seen since the Great Recession (2008-2009).

Chiefly among all other obstacles to GDP improvement is unemployment, Eisenberg emphasized. Estimates from the Wall Street Journal range from 20 to 30 million jobs lost due to the crisis. The U.S. Bureau of Labor Statistics’ June report shows a 13 percent unemployment rate. Due to calculation errors by the study, Eisenberg argues that the real number is closer to 16.3 percent.

“People who lost their jobs will have to find new jobs with new employers, and that is going to take time,” Eisenberg said. “We are not going to create 20 million jobs in a month. That is simply not going to happen. If we create 2 million, I’ll be very happy.” For reference, during the height of unemployment during the Great Recession, the unemployment rate was 10 percent.

Sustained recovery comes down to the government stepping up to secure households and support businesses to get back on their feet, he stresses. “Government spending has come to the rescue. There are no ifs, ands or buts about it. The government came out guns blazing here,” Eisenberg said. “Our economy was in a coma, and this kept us alive period while we were locked in our houses and didn’t have our jobs.”

More needs to be done to get the unemployment number down. “Even at 10 percent, we saw mass dislocations and a long, miserable recession. I’d like to think it would come down to 11 or 12 by the end of the year. This will still be worse than the last recession so congress has to come through with funding.”

Due to the low-interest rates at 0.125 percent, now is not the time to worry about the national deficit, he added. According to Eisenberg, the consequences of increasing the deficit will be nothing compared to the “ravages” of what the economy will endure without additional spending.  “This is threat number one to our economy: Will congress come through, and how much will they come through with? They are going to help households get jobs and while they are unemployed. If they don’t come through and we go through this time of high unemployment in this 13 to 14 percent range, we are going to have a world of hurt in our economy.”

Eisenberg said he doesn’t see politics ultimately obstructing the recovery spending. “There is political will to do it, they are just fighting over what they want. They are going to figure it out, but they need to do it before the end of July. They do not have the luxury to be waiting.” If significant relief measures are taken, the recession will be relatively short and painful with a steady recovery, he said.

Inflation - What Inflation?

The U.S. Department of the Treasury injected $267 billion of stimulus checks for most Americans into the economy to combat the economic fallout from the pandemic.

“You are going to say ‘The money base is going up like crazy. More money, more inflation?’ I don’t think so,” Eisenberg said. It is important to note that the monetary base does not create inflation on its own, he added.

“First you have to have the velocity of money moving. The dollars here are not moving anywhere: Banks hold bonds. The Central Bank creates money then gives this to the bank.”

Though most Americans have all gotten $1,200 richer, this is moot in comparison to how the Central Bank and other banks are handling this crisis. “There is no more money in the economy since the banks are trading. The bank in turn takes the bond and gives it to the Central Bank. The bank is essentially trading bonds for cash to the Central Bank,” Eisenberg said.

Another indicator Eisenberg and his fellow economists use to measure the threat of inflation is the type of inflation. CPI inflation is more volatile as it includes food and energy prices. But Core inflation is the metric to watch. When considered, there is no evidence of inflation from the Core standpoint, he said.  “So, what is going to happen to rates? Absolutely nothing for years.”

Construction Outlook

The best construction news comes from the housing market, according to Eisenberger.

“Housing is in a ‘V’-shaped recovery. It is a sector that is doing remarkably well. It completely collapsed and completely recovered.”

An unaccounted-for psychological effect, he argues, is that after people were stuck in their houses, they realize they want to move. “There are unprecedented mortgage applications,” Eisenberg said. “Things are going to improve.”

What follows this crisis is an entirely different scenario in comparison to the 2008 crash when housing was at the center of the recession. “Housing is not the crux of the problem. Now there are no houses. Look at the inventory: 1.5 million now compared to the 4 million years ago,” Eisenberg said. “In terms of new housing, 2010-2020 is the worst decade of building in decades. There is a massive shortage of housing.” Eisenberg forecasts a full recovery in housing construction by August or September due to the higher demand.

“This is a recession that bypassed housing,” he said. “This is a true ‘V’-shaped recovery. Prices continue to rise. Rates are low and demand is strong.”

Final Thoughts

If history can be a guide to the present crisis, data from how the economy faired after the Spanish Influenza pandemic of 1918 can be an indicator. In a graph of all U.S. economic recessions in history, the data shows the pandemic as a 6-month recession.

“This is the recession that followed the Spanish Influenza Pandemic of 1918. It led to a depression, but the depression was unbelievably short. The Spanish Influenza killed 500,000 people. This is a very big percentage of the population. It comes in two waves and goes away. Then the economy rockets,” Eisenberg said.

Recessions coming from issues outside of the U.S. border tend to be shorter, he added. “This is a recession with nothing organic. 2000 was the Dot Com Boom. 2008 was massively organic. The recession of 1990 was too much real estate,” Eisenberg said. “Those three were all slow and jobless recoveries. I tend to think this one is going to look like those older recessions because of the evolution of it. There is nothing organic here. We were just whacked from this virus from China.”

With his personal graph utilizing data from the best available sources, he forecasts the worst will be a 10 percent real decline, then we will make up 4 percent of that loss by the end of the year. “It will take two full years until February 2022 to get things where they were. This is going to be a slow recovery. First quick, then slow, but we’ll get out of it.”

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Elliot Eisenberg, PhD
Elliot Eisenberg, PhD

Elliot Eisenberg, Ph.D. is an internationally acclaimed economist and public speaker specializing in making the arcana and minutia of economics fun, relevant and educational. He earned a B.A. in economics with first class honors from McGill University in Montreal, as well as a Masters and Ph.D. in public administration from Syracuse University. Eisenberg, a former Senior Economist with the National Association of Home Builders in Washington, D.C., is the creator of the multifamily stock index (the first nationally recognized index to track the total return of public firms principally involved in the ownership and management of apartments), the author of more than eighty-five articles, serves on the Expert Advisory Board of Mortgage Market Guide and is a regular consultant to several large real estate professional associations, hedge funds and investment advisory groups. He has spoken to hundreds of business groups and associations, often as keynote speaker.  Learn more at https://econ70.com.

Coronavirus

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Association
of Michigan

One Industry.
One Resource.

Coronavirus: Info and Updates

Michigan's Construction Industry Returns to Work

June 15, 2020

Under the current Executive Order order, construction sites must adopt a set of best practices to protect their workers from infection. Those practices include:

  • Designating a site supervisor to enforce COVID-19 control strategies.
  • Conducting daily health screenings for workers.
  • Creating dedicated entry points, if possible, or issuing stickers or other indicators to assure that all workers are screened every day.
  • Identifying choke points and high-risk areas (like hallways, hoists and elevators, break areas, water stations, and buses) and controlling them to enable social distancing.
  • Ensuring sufficient hand-washing or hand-sanitizing stations at the worksite.

Click here for MIOSHA Return to Work Resources

Click here for OSHA Control and Prevention for Construction

Click here for CAM Members assisting with Return to Work

Members Serving Members
Members Serving Members

CAM has assembled a list of CAM members providing information, supplies, and resources available to assist your safe return to work.  Click the image above to access our Members Serving Members page.

Resources

Return to Work Toolkit

On-Demand Webinars

State of Michigan Health and Human Services Recommendations

Information about this outbreak is changing rapidly. You can stay informed by regularly visiting Michigan.gov/Coronavirus and CDC.gov/Coronavirus.

Resources for Employers

On April 23, Congress approved additional funding for the federal Paycheck Protection Program (PPP), which offers forgivable small business loans to cover up to eight weeks of payroll and other costs such as rent and utilities. The loans are primarily available to companies with up to 500 employees. We strongly encourage you to apply now with your lending institution as applications are likely to be processed on a first-come, first-served basis.

Find a lender

Complete application

Small Business Assistance

State of Michigan / Unemployment

Tax / Financial / HR Information

Legal Resources

Resources for CAM Members

Precautions at the Construction Association of Michigan

CAM logo

All CAM employees have returned to the Bloomfield Hills office, effective June 15, 2020. Visitors to the building are required to wear a mask, answer health screening questions, and undergo a temperature scan. As previously announced, the 334 S. Water Street office located in Saginaw is closed permanently.

Future CAM events, classes, and meetings are being evaluated on a case-by-case basis and our team is working to notify affected parties as soon as possible. Click here for upcoming events.

News

Mid Year Forecast Recap

Mid-Year Forecast Recap

June 13, 2019 – At today’s Mid Year Forecast and State of the Industry Breakfast, co-hosted by Construction Association of Michigan and Southeastern Michigan Home Builders Association, 250+ attendees were presented with information concerning the national economy and Michigan’s economic outlook.

During the first presentation by Gabriel Ehrlich, Director of Research Seminar in Quantitative Economics (RSQE) and Assistant Research Scientist with experience in the Financial Analysis Division at the Congressional Budget Office (CBO), statistics indicated that by July 2019, the national economy will set a record for longest sustained period of growth.  To view all of the charts and graphs presented by Gabe, click here.

The second half was presented by returning speaker Eric Bussis, the Michigan Chief Economist and the Director of the Office of Revenue and Tax Analysis at the Michigan Department of Treasury.  Eric’s remarks focused on Michigan and demonstrated that Michigan has outperformed the US and Great Lakes States during the economic recovery.  To view Eric’s presentation, click here.

To view photos from the event, click here.

Special thanks to our sponsors:

Platinum

Construction Federal Credit Union
Michigan Talent Investment Agency
Doeren Mayhew

Gold

Progessive Plumbing Supply
Testing Engineers & Consultants
Rehmann
Progressive Sweeping Contractors
CMIT Solutions
Surework Construction
PlanGrid
Plante Moran
Operating Engineers Local 324 LMEC & JATF
Pella Window & Door

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Member Benefit: New Voluntary Dental Plan

Your association-sponsored group plan may be an effective way to reduce your employee benefit costs!

We are pleased to announce the introduction of new voluntary, employee-paid dental plans being offered by the CAM Benefit Program. These plans are for groups with as few as 5 eligible employees, require zero employer contribution, and have a low 25% employee participation requirement (e.g. 5 eligible employees, 2 enroll, participation equals 40%).

Network access is provided by Dentemax PPO network. There are no waiting periods for services, and these plans are competitively priced. Higher participation may result in lower rates. The vast majority of CAM members will qualify for the rates illustrated below:

Dental Benefits   Basic Plus Plan   Value Plan
In Network Out of Network In Network Out of Network
Deductible

 

$0 $50 $25 $50
Preventive 100% 80% 100% 100%
Basic 80% 50% 80% 80%
Major Not Covered Not Covered 50% 50%
Ortho Not Covered Not Covered Not Covered Not Covered
Annual Maximum $750 $1000
Enrollment Status Rates Rates
Employee $26.10 $34.35
EE/Spouse $48.60 $71.26
EE/Child(ren) $45.30 $66.43
Family $72.98 $98.59

 

For more information, contact Rob Walters at CAM Administrative Services – 248.233.2114 or rwalters@camads.com.

Quote Request

Update on the Wayne County Criminal Justice Center Project

On Wednesday, August 16, 2018, the project team of the Wayne County Criminal Justice Center presented an informational seminar at Greektown Casino Hotel in Detroit. The project partners are contractor Barton Malow, Bedrock Detroit, HOK Architects and Wayne County.

On behalf of the Wayne County Department of Human Relations, Victoria Iniss-Edwards gave tips on how to successfully qualify to be a part of the project, including becoming a Wayne County Certified company, and considering Mentor-Venturing or Joint-Venturing. A Wayne County Certification is good for three years and can be re-issued by contacting her office. Additional information, including how to register in Procure to Pay, can be found at www.waynecounty.com or by telephone at (313) 224-5021.

Dannis Mitchell, Barton Malow diversity manager, spoke on local participation and what interested parties will need to know in order to bid and work on the job. The project requires that 51 percent of total hours worked be completed by Wayne County residents.
Ms. Mitchell works closely in conjunction with Victoria Iniss-Edwards from Wayne County. Both women are available to answer any questions regarding the qualification process.

Jeff Goodale, ACA, global justice director at HOK Architects, spoke on the design of the Wayne County Criminal Justice Center. The project will include a juvenile detention facility (JDF), a courthouse (Court), and an adult detention facility (ADF) that will house 2,200 beds and offer counseling and rehabilitative spaces. Inclusively, the project will be 1 million SF located in Detroit at the intersections of Ferry Street, Russell Street and the Chrysler Service Drive. HOK Architects is the number-one architectural firm in the United States doing sustainable government work.

Barton Malow Project Director Andrew Miller and Project Manager Steve Ocana spoke on their company’s rich history of construction in the City of Detroit. They also presented the project timeline, as follows:

– Fall 2018 – Project begins / Site Mobilization / Demolition
– Winter 2018 – Foundations ADF
– Spring 2019 – Foundations ADF / Court / JDF
– Summer 2019 – Foundations ADF / Court / JDF /Prosecutor Sheriff / Superstructure ADF
– Fall 2019 – Foundations Pro-Sheriff / Superstructure ADF / Court / JDF
– Winter / Spring 2020 – Prosecutor / Sheriff Structure – All
– Summer / Fall 2020 – Superstructure Court, Pro-Sheriff / Enclosure MEP / FP, JDF / Court / Pro-Sheriff, Interior Rough & Fit-Out ADF / JDF / Court
– Winter / Spring 2021 – Building Enclosure Court / Pro-Sheriff, Interior Rough & Fit-Out ADF / JDF / Court
– Summer / Fall 2021 – Interior Fit-Out – All
– Winter / Spring 2022 – Interior Fit-Out – All, Commissioning – All
– Summer 2022 – Substantial Completion – FINISH

Note – All times are “targets” and are subject to change.

The Wayne County Criminal Justice Center will be bid in multiple bid packages – please refer to the timeline. At press time, only one contract has been awarded for precast work to Kerkstra Precast, Grandville, MI.

To find out more about the Wayne County Criminal Justice Center, visit www.bartonmalow.com/outreach and click on Projects; select Wayne County Criminal Justice Center; click on Project Registration; and complete the Project Registration Form. The page will also be frequently updated for bid package outreach events, project news, and more.  CAM Virtual Leads subscribers can stay up to date by tracking project #2018-580F.

The Mid-Year Economic Forecast a Success

The Construction Association of Michigan (CAM), American Institute of Architects Michigan (AIA) and Home Builders Association of Southeastern Michigan (HBA) partnered to present the eighth annual Mid-Year Economic Forecast and State of the Industry Breakfast on Wednesday, June 20, 2018. The event was held at the Suburban Collection Showplace in Novi and featured Keynote speakers Eric Bussis, Michigan Chief Economist and Director of the Office of Revenue and Tax Analysis in the Michigan Department of Treasury and Jim Baird, partner with Plante Moran Financial Advisors, Chief Investment Officer and Investment Committee Chair.

Kevin Koehler, president of CAM noted, “With this annual event, we have created a valuable service to everyone involved in construction. We offer them the opportunity to convene to gain national and regional perspectives on our economy and the impact on our industry.”

Michael Stoskopf, CEO of HBA chimed in before the event, “This is the eighth year we are producing this event and we anticipate that both speakers will offer important insights to aid the audience in making their business plans for the remainder of 2018 and beyond.”

Click here to view the presentation as given by Mr. Eric Bussis, Michigan Chief Economist and Director of the Office of Revenue and Tax Analysis in the Michigan Dept of Treasury

Click here to view the presentation as given by Mr. Jim Baird, partner with Plante Moran Financial Advisors, Chief Investment Officer and Investment Committee Chair

 

 

 

Member Benefit: Virtual Planroom

The Construction Association of Michigan has been providing project reporting since our earliest beginnings in 1885.  Our newsroom works tirelessly to bring you the most accurate, up-to-date information on projects bidding throughout Michigan and surrounding areas.  We report on approximately 8,000 unique projects every year!  All CAM members are welcome to access the online planroom from our offices located in Bloomfield Hills and Saginaw.  For a more personalized experience, the planroom may be accessed from your home or office through a paid subscription.  We offer monthly, quarterly and annual payment plans.  For more information or to request a FREE trial, visit our Virtual Planroom page.

The Mid-Year Economic Forecast

Join the Construction Association of Michigan (CAM), the Home Builders Association of Southeastern Michigan (HBA), and the American Institute of Architects (AIA) as we assess the national and regional perspectives of our economy and how it is affecting our industry.


On Wednesday, June 20, 2018, these organizations will present the eighth annual Mid-Year Economic Forecast and State of the Industry Breakfast at the Suburban Collection Showcase in Novi.



Click here for more information and to register. Also, sponsorship opportunities are available!