The top 10 business stories to watch in Louisville in 2020 – Louisville Business FirstJanuary 3, 2020
This article originally appeared in Louisville Business First.
This year is shaping up to be a newsy one. From updates on controversial projects like Topgolf and One Park to the evolution of Louisville’s startup scene to high-stakes maneuvering within the General Assembly, and lots more in between, the new decade will offer plenty to read about. Here’s a roundup of 10 business stories that we know will grab headlines in 2020.
How will U of L’s big risk, big reward on KentuckyOne play out?
If the University of Louisville can stick the proverbial landing with U of L Health Inc., the school will have successfully taken over a citywide health system for just $10 million.
The school-controlled health care holding company acquired Jewish Hospital and other KentuckyOne Health Inc. assets from Englewood, Colo.-based Catholic Health Initiatives on Nov. 1, 2019. That marked an end of the more than two-year saga of uncertainty that plagued Jewish Hospital, which has long suffered from poor financial performance.
However, U of L has turned the uncertainty surrounding Jewish Hospital and the KentuckyOne Health assets onto itself by taking them over in part based on political promises from elected officials — the most prominent being from former Gov. Matt Bevin. U of L’s hopes hinge on the General Assembly providing the school a $50 million partially forgivable loan.
The loan will compete for attention in the General Assembly with issues such as public pension funding, a projected $1 billion revenue shortfall in the state’s biennial budget, Gov. Andy Beshear’s promised raise to the state’s teachers and covering increasing Medicaid costs.
While many lawmakers say that they are positive on the chances of the loan passing, they also say it will face scrutiny.
The school also has secured $50 million in support from two local foundations for the turnaround and integration of KentuckyOne into U of L Health.
To further complicate the turnaround, U of L Health is not able to bill insurers for services provided at the KentuckyOne facilities and by former KentuckyOne doctors and won’t be able to do so until about mid-January, according to U of L Health CEO Tom Miller.
By that time, U of L Health will hold about $200 million in unbilled accounts, Miller told the U of L board of trustees’ finance committee in December.
“It’s going to be very tight for us as we try to go forward over the next few months. … But we do believe that with the help of the state we believe that we will be OK,” Miller said.
If U of L can make it through 2020 in good shape, the school will control a health system that operates five hospitals, four medical centers, more than 1,000 providers and over 10,000 employees — all for the purchase price of $10 million.
— Chris Larson
Beshear, business and Bevin — oh my!
The governor’s race in Kentucky for 2019 was close: Democrat Andy Beshear won the race by 0.36 percent, or about 5,000 votes, over incumbent Republican Matt Bevin.
Even in victory, Beshear’s work is cut out for him going into 2020. The state Senate and House of Representative are controlled by Republican supermajorities and all of the other statewide races in the 2019 election went to Republicans.
But that hasn’t stopped Beshear from trying to make a splash before 2020 rolled out. In his first days in office, Beshear fired the Kentucky Board of Education and installed his own members, restored the voting rights of roughly 140,000 convicted nonviolent felons who completed their sentences and did away with the controversial Kentucky HEALTH Medicaid-related reforms that Bevin championed.
Going in to 2020, Beshear demonstrated the importance of workforce development and education to his administration, in part through the radical move to reform the board of education, but also through his appointment of Lt. Gov. Jacqueline Coleman to the dual role of lieutenant governor and secretary of the Education and Workforce Development Cabinet.
Health care also will be a hot-button issue for the Beshear administration. On the outset of his tenure, Beshear protected the expanded access and wider qualifications of the Medicaid program allowed by the Affordable Care Act. Beshear’s father and former Gov. Steve Beshear expanded the Medicaid program to match ACA’s provisions by executive order in 2014.
Beshear also decided to rescind a last-hour move by the Bevin administration to oust Passport Health Plan and Anthem Inc.’s Kentucky entity from being one of the five companies to administer about $8 billion of $11.5 billion of the state’s Medicaid program.
Citing a lack of transparency by the Bevin administration, Beshear reopened the bidding process for the Medicaid provider contracts in what will be an accelerated timetable starting Jan. 10, with a target selection date sometime around April.
Despite Beshear’s reversal, uncertainty continues to surround Passport’s stalled $100 million headquarters project on Louisville’s West End, as the Medicaid contract accounts for about $1.93 billion of Passport’s $1.95 billion in annual revenue.
But the HQ on South 18th Street could see new life after it was revealed that California.-based Molina Healthcare Inc., also a Medicaid provider, will push for the development of the project, and will support the effort by committing to be a medium-term lease as a tenant at the property. The company would house its projected 1,100 employees at the property, according to a source familiar with the matter.
Passport maintains it is still moving forward with its plans for the property.
— Chris Larson
Chad Coulter/Biscuit Belly
Biscuit Belly dominated restaurant headlines in 2019, and we should expect more of the same going into 2020.
The fast-casual restaurant opened its first location in NuLu in June 2019 and announced two more locations in St. Matthews and Colonial Gardens before the year was over. Chad Coulter, who owns both Biscuit Belly and LouVino, said the concept has been in the works for several years, but it took a while to find the right location for the first restaurant.
“I’m originally from Georgia and there’s all these little mom-and-pop shops in the South with these big biscuit sandwiches,” he said. “I had been following the success of Biscuit Love and Biscuit Head and all of those concepts — I just really wanted to do it here in Louisville.”
Coulter, who was one of Business First’s Forty Under 40 honorees in 2017, said he aims to expand Biscuit Belly to 15 to 20 locations within the Louisville metro area. Part of the explosive growth is triggered by the need to saturate the Louisville market, while also keeping up with consumer demand, he said.
“The concept has already been proven and from what we’ve seen, it’s created a level of fandom,” Coulter said in a previous interview. “People are already pretty darn loyal to the brand and love the product. They have been begging for more locations.”
He shared that he wants to grow the brand as quickly as possible, averaging a rate of three to four new openings each year. Eventually, Biscuit Belly could be acquired, or add a strategic partner to help grow the concept beyond the region, Coulter continued.
“If we can grow it and get to 15 locations, I think we could be very attractive for an acquirer because we hopefully will have shown that we can be successful in many different markets, different cities and different demographics,” he said. “That’s really what someone who wants to take this and run with it would want.”
— Haley Cawthon
NuLu’s growth looks to only expand in 2020
The continued renaissance of the NuLu neighborhood was a major storyline during 2019, and growth there will continue to make headlines this year.
The popular edge neighborhood is slated to welcome several major projects this year.
Campisano Capital is expected to open the doors later this year to The Gateway to NuLu, a roughly 75,000-square-foot technology hub that will be home to Louisville technology firms El Toro LLC and EdjAnalytics LLC, co-working concept Lodgic Everyday Community and a local office for Campisano Capital. El Toro is expected to hire up to 400 workers in the next five years in that space.
Campisano also recently closed on the Joe Ley Antiques property, so we should expect to see more detailed plans for that property’s new use in this year.
Nearby, Louisville real estate investor Mo Deljoo has started rolling out tenants for his 50,000-square-foot NuLu MarketPlace at 817-825 E. Market St. The project includes about 40,000 square feet of commercial space and four eclectically designed apartments on the top floors.
Lexington, Ky.-based West Sixth Brewing plans to open a 9,000-square-foot brewery, barrel-aging warehouse and taproom in NuLu MarketPlace. The $2 million brewery is slated to open in early 2020, and other retailers and restaurants will follow.
Meanwhile. Louisville-based Weyland Ventures is putting the finishing touches on Hancock House, a micro-boutique hotel with 16 units that will include some commercial space, including a new spot for Louisville’s ‘s The Seafood Lady restaurant.
Weyland Ventures also is turning a rundown NuLu church into ChurchKey, a restaurant, sports bar and entertainment venue that is eyeing a March 2020 opening.
Another significant NuLu redevelopment to watch in 2020 is the transformation of the Service Machine & Welding Co. facility at 700 E. Main St. and 121 S. Clay St.
Indianapolis-based Buckingham Cos. filed a development plan with Louisville Metro Planning & Design Services in June to turn the vacant warehouse building into a 305-unit apartment community that would also house a 4,486-square-foot restaurant.
However, few details have been shared. Hopefully we will know more in the coming months.
— Marty Finley
Kevin Cogan dishes on One Park’s next steps
Kevin Cogan’s massive One Park mixed-use development late in the year won approval from Louisville Metro Council to build at Lexington Road and Grinstead Drive. But you should not expect a groundbreaking to come in 2020.
Cogan said during a recent interview at his East End office that he will spend the next 12 months or so finishing up the technical aspects of the $250 million project, from geotechnical and structural engineering to structural drawings and budgeting. Cogan also will have to finalize his financing and lender partners.
He also will work concurrently to nail down some of the tenants that will be going inside the complex. The plan calls for 421 apartments; a luxury-branded hotel with up to 250 rooms; and tens of thousands of square feet of restaurant and retail space.
Cogan described One Park as a “layer cake” that must be completed in step before you can put the icing on top.
“There’s a lot of multitasking that takes place, as it does for [all of these projects],” Cogan said.
One Park has been a highly controversial project, subject to a dozen neighborhood meeting and a major downsizing.
Cogan’s original plan called for three towers, the tallest reaching 34 stories. Neighbors balked at the notion, demanding Cogan overhaul the plan. He didn’t budge for years until he presented the new plans in April 2019 — calling for a single 18-story tower attached to a smaller commercial complex.
While the revised project still faced dissenters, there were fewer people who objected to that proposal as it appeared to be more palatable.
Louisville Metro Council had no concerns, issuing a unanimous 24-0 vote in favor of the project Dec. 12.
“I feel it was an endorsement by the leaders within the city of Louisville to embrace a new day. Something different. Something unique. And something that will help attract young millennial talent,” Cogan said of Metro Council’s vote.
• Other projects in the works
One Park is only one of several projects Cogan has in the pipeline in Louisville. He is finalizing construction costs and design plans for the 19-unit Willow Grande condo development in the Cherokee Triangle area, which should start the presale phase in early 2020.
Cogan said he also hopes to break ground on 422 e-Main — an eight-story apartment complex with 343 units and 11,000 square feet of commercial space next to Louisville Slugger Field — by March or April.
And he is finishing up the first phase of The Ivy Apartments, an upscale $50 million apartment complex with hundreds of units on Terra Crossing Boulevard off Old Henry Road in the East End.
— Marty Finley
Will Topgolf’s legal battle end this year?
That’s where Topgolf’s plan to add a golf driving range with a bar and dining venues at Oxmoor Center still finds itself heading into 2020.
But another legal showdown is brewing as nearby residents who sued are preparing their brief before the Kentucky Court of Appeals.
Neighbors of the facility, represented by longtime Louisville land-use attorney Steve Porter, will again make arguments that Topgolf was not eligible to do business in Kentucky when it filed its application to Louisville Metro Government to build the complex.
“This appeal will be based on the misinterpretation by the circuit court judge of the responsibilities and duties of the planning commission and its staff as compared to the position of the general public and neighbors,” Porter said in a July email to members of the local media. “The Kentucky statutes require a zoning application to be ‘accurate and complete.’ That was not true in this case.”
In June, Jefferson Circuit Judge Ann Bailey Smith ruled that the Louisville Metro Planning Commission and Louisville Metro Council did no wrong in approving Topgolf’s rezoning request, development plan and various waivers and variances related to issues such as lighting and height.
Smith’s ruling came after a late May hearing at which the three neighboring couples who sued Topgolf, the owners of Oxmoor Center, the Louisville Metro Planning Commission and Louisville Metro Council, argued their case. The lawsuit claimed the project and its approvals violated the city’s land-development code and comprehensive plans.
Topgolf’s attorneys have countered those claims in court.
Concerns by neighbors about the height of the complex have been raised, as have concerns about lighting, noise, increased traffic and late operating hours.
Greater Louisville Inc., the metro chamber of commerce, and other members of the business community have rallied behind the project, and Topgolf reaffirmed its commitment to the development this summer. We’ll see if that commitment holds should the appeal process prove to be lengthy.
— Marty Finley
Louisville City ready to kick-start a new era
Standing inside the Louisville City Football Club team store inside Fourth Street Live the week before Christmas, team President Brad Estes talked about a new era for the soccer club that has captured the fascination of a city and racked up two United Soccer League Championships and a slew of Eastern Conference championships in its first five seasons.
Estes was there to debut the team’s new logo and crest ahead of its first home game inside the new Lynn Family Stadium in 2020. After backlash from fans, the new logo was scrapped just days after it was revealed, and Estes said the team will work with fan groups on an updated design.
Meanwhile, the new 11,700-seat stadium, estimated to cost $65 million, can hold 14,000 at capacity and is sure to have one of the most raucous sports atmospheres in the city once it debuts in April. The team’s schedule is still being finalized.
Come 2021, the stadium will welcome a second professional soccer franchise, Proof Louisville FC, when it takes the pitch for its inaugural season in the National Women’s Soccer League inside the new stadium.
Estes also said the stadium will serve other purposes when soccer is not in session. For instance, they are planning a special Thunder over Louisville event there this year, the details of which are still top secret. He also anticipates one to two concerts will be booked for the stadium in 2020, noting that three to four concerts could be held there annually going forward.
The team also has plans for the land around the stadium. As we have previously reported, an adjoining commercial district will be constructed on nearly 40 acres in Butchertown. That neighborhood is on the rise with a new brewery joining Copper & Kings and several restaurants, apartment complexes and other projects that have been announced there.
The stadium district, located along Adam and Campbell streets, could include hotels, restaurants, retail, office space and a microbrewery. The total cost of the entire project has been estimated at nearly $200 million.
Estes said last month that global design and architecture firm Gensler has been hired to create a masterplan for the commercial district, which will set the road map on how to proceed. That plan is due to club owners in early 2020.
Estes declined to comment on a timeline until the masterplan is finished, but he still expects a hotel, some mixed-use retail and potentially some office and residential components.
“We don’t have to do anything right now,” he said of the stadium district’s next steps. “We want to do it right.”
— Marty Finley
LG&E vs. Bernheim Forest
A showdown between a utilities giant and a nature preserve is expected to ratchet up in 2020.
LG&E’s plans to build a natural gas transmission pipeline that could cut through 4,000 feet of Bernheim Arboretum and Research Forest conservation land will be decided by the Kentucky Public Service Commission.
The pipeline, which would serve a growing demand in Mt. Washington, Shepherdsville, Clermont and Lebanon Junction, would affect eight acres of forest in the Cedar Grove Wildlife Corridor in Bullitt County, according to Bernheim’s statement to the commission addressing LG&E’s pipeline points. The arboretum said the area is home to rare and threatened species and placing the 12-inch-wide pipeline through the habitat would irrevocably change the land. It recently found two new species of snail along the proposed pipeline route as well, one of which may be new to science entirely.
In the latest chapter of the battle, the commission, which issued LG&E a Certificate of Public Convenience and Necessity (CPCN) in 2017, denied Bernheim’s request to void its final order in the case against the utilities company. Bernheim contended it had a right to know of LG&E’s forthcoming pipeline plans and its claims to the land in Bullitt County were violated by the CPCN.
After receiving briefs from both parties, the commission found Bernheim’s claims insufficient.
The existing distribution line, which the proposed pipeline would run parallel to, serves more than 9,500 customers in the area but is reaching capacity. Without the new line, LG&E said, 62 new businesses and residences have been denied service. The utilities company said it expects the pipeline to be 12 inches in diameter and 12 miles long and will support economic growth and development in the region by reducing the chances of outages for businesses and residents.
According to Bernheim’s website, 8,371 people have signed a petition to protect the Cedar Grove Wildlife Corridor.
“Every cut across Bernheim adds to a reduced quality of life for all due to loss of clean water, air and beauty,” a Bernheim release says. “Bernheim plans to exist for 90 more years and 900 after that, so we must avoid the slow death by a thousand cuts over time.”
To view documents pertaining to the case, visit the Kentucky Public Service Commission’s website at psc.ky.gov.
— Sarah Shadburne
Bellarmine enters the big time
The Bellarmine Knights will usher in a new era in 2020 with its inaugural season as a member of Division 1 NCAA athletics.
In June, Bellarmine was formally accepted as the 10th member of the Atlantic Sun Conference, branded as ASUN, which is a mostly Southeastern collegiate league of schools, including Kennesaw State University, Liberty University, Florida Gulf Coast University and Lipscomb University.
ASUN will sponsor 17 of Bellarmine’s 22 sports programs, not including men’s lacrosse, men and women’s swimming, field hockey and wrestling. The university had been a member of the Division II Great Lakes Valley Conference, which Bellarmine helped create in 1978.
The private university is looking to spend between $6 million and $7 million toward the improvement of its athletic facilities — including an expansion and renovation of the 2,196-seat Knights Hall — as well as the $1.6 million application fee and $1.7 million to be paid to the NCAA and ASUN, respectively. The money will also go toward athletic fields for the baseball and softball programs.
A capital campaign will be launched to help raise funds.
University President Susan Donovan said she hoped the move to Division I will raise the school’s national profile and boost enrollment overall. As of fall 2019, Bellarmine reported a total enrollment of 3,331 students.
The Atlanta-based ASUN conference has a long-standing partnership with ESPN and its programming is featured on the ESPN+ format.
— Sarah Shadburne
Keep your eyes on these 5 startups
As the startup reporter for Business First, I’ve met with so many inspiring and thoughtful founders this year to learn about their innovative business ideas. While there were many worthy startups that could have made this nonranked list, I had to whittle it down to just five that I expect will be newsmakers in 2020. Here they are:
EdjSports has also been working on a $5 million fundraise this year.
The data-science company aims to help coaches and teams make better calls through predictive models and custom software. It takes away the subjectivity and focuses on the likelihood that a play will lead to a win.
EdjSports, a subsidiary of EdjAnalytics, is poised for a unique opportunity heading into 2020, including EdjZone, which can be utilized by both media and fans. EdjSports also recently formed a partnership with Massey Ratings to develop products around other sports.
Truman’s, an innovative cleaning products company, made headlines in September by announcing a $5 million raise.
The startup offers a product line of four non-toxic cleaners for kitchens, floors, showers and glass that come with tongue-in-cheek names and comical taglines.
The brand’s forward-thinking approach to marketing is making its products stand out on social media.
Untitled, a data-driven marketing firm, has grown rapidly in 2019.
Aaron Peabody, Kramer Caswell and Connor Gaffney founded Untitled Firm in October 2018, offering four core services: web development, digital marketing, data analytics and data architecture. To put it simply, Untitled aims to guide daily decisions through data to remove subjectivity.
RCM Brain is the third company on my list that closed on $5 million raised this year.
The funds will be used to build products, build operations and kick-off sales and marketing efforts for the revenue cycle management company. RCM expects its number of clients to grow in 2020, as it has launched an official version of its software and shifted to a full-service model.
Unitonomy is the newest startup on my list of five. It was founded over the summer by Charley Miller, co-founder of TouchCast, a New York-based video communication company.
Unitonomy — a combination of “united” and “autonomy” — is working on a platform that will help companies grow, manage and measure their culture via SaaS software. The startup was a Vogt Award winner in and planned to use the $25,000 of seed money to build the analytical tool.
— Haley Cawthon