The Tom Monaghan Interview
I’m enclosing an interview (below) done in 2008 to gain insight into Tom Monaghan’s work on building Domino’s Farms. Domino’s Farms is located in Ann Arbor, Michigan, where my office was. I moved into that building first as a successful financial planner and quickly converted my attention to creating a new company, Broadacre Network. I focused my attention entirely on Domino’s business. I built a relationship with Apple Computer (as a value-added reseller – VAR) and General Electric (as a value-added service provider – VASP) to provide the hardware and software needed for this adventure.
I created Broadacre Network (an Apple VAR and a GE VASP). I sold close to $10,000,000 in Apple computers to Domino’s to use within their new “Dominet” communication network I also created. The GE network I used had the US Army on the same satellite system. During my journey, I had the pleasure of inviting the president of Apple Computer (John Scully) to meet with Tom Monaghan at Domino’s Farms. I eventually ended up networking all of Domino’s locations in the US and 26 foreign countries over just a few years.
This was considerably before the Internet became a commercial reality, and I was too early to make much out of my efforts. I tried creating a private placement to accomplish this but couldn’t get any customers who believed the Internet would become viable. I quit and moved on in 1992. in 1994, Netscape came out with their version of the Internet with a similar user interface that I used back in 1986.
I was also the 1st outside tenant (originally as a financial planner and unintentionally as a computer network provider to Domino’s Pizza) in Domino’s world headquarters building. I watched Tom Monaghan go through his considerable asset purchases and gradually move to Florida to further that work. He, too, gave up his business and ended up dedicating his work to benefit the Catholic Church. Here is an interview that was done in 2008 that will provide you with a bit of insight into what Tom Monaghan was doing at that time:
Here’s The Interview:
“The casual driver on U.S.-23 might never consider a 30-story office tower the missing piece to Domino’s Farms Office Park.
Yet it’s just what Tom Monaghan mentions first when asked how his landmark office park differs from his original vision for the 300-acre former farmland.”I thought I’d have a tower,” Monaghan told me. “The tower was the main thing when I started this.”
Monaghan started the nearly 1 million square foot office building that redefined the northeast Ann Arbor office corridor between Plymouth Road and M-14.
That building, in turn, began as Monaghan’s vision for a lasting symbol of – and corporate headquarters for – his Domino’s Pizza, which he says, “in the ’80s, was the fastest-growing restaurant chain in history.”
The building lives today as a multi-tenant facility, part of a campus with a chapel and petting farm. To the southwest, nearby land is in litigation with Ann Arbor Township for development as a retail center; to the east, Gabriel Richard High School stands near more acreage available for future use.
Monaghan symbolized the corporate potential of the Ann Arbor business for decades, growing into a national figure even as locals challenged his direction and politics and then shifting the focus from the pizza business he sold in 1998 to Catholic philanthropy and education.
Today, he spends most of his time in Florida, growing the Ave Maria town and university near Naples, which welcomed the 11,000-home Catholic community that Monaghan once considered for Ann Arbor.
I met recently with Monaghan in his office at Domino’s Farms, which he was preparing to move into another area of the building. The University of Michigan had just leased more space but needed the remaining square footage that Monaghan was using- so, given his limited time in Ann Arbor, he said, he’ll accommodate the tenant and find a smaller unused office in the complex.
Monaghan steered the pizza company to tremendous success, then channeled his longtime passion for architecture into Domino’s Farms. Now, he generates profits to plow them back into his Catholic philanthropy, with his Ave Maria Foundation growing to $104 million in 2006.
The man who today laughs over the elaborate office that he designed then occupied as the former owner of Domino’s Pizza doesn’t regret that that office space also no longer exists in the building – it too gave way to expanding tenant needs.
I talked with Monaghan because a second book has just been published about Domino’s Farms, and the timing seemed right – even though it was years after I first asked whether I could talk with him.
The building, started in 1984, is more than a structure for Monaghan – it remains a monument to his passion for design and Frank Lloyd Wright’s influence.
Perhaps the most curious part of our conversation came when Monaghan, after detailing his building efforts in two states, his vision for Detroit near his former Tiger Stadium, and his unfulfilled vision of locating Domino’s Pizza stores in formatted retail centers – and building high-end homes near Ann Arbor around a golf course – spoke of what he might have done with his life:
“If I wasn’t in the pizza business, I think I would have liked to have been a developer.”
Pizza was his business. Advancing Catholic causes fulfills that today.
But in between, Monaghan built a lasting influence in Ann Arbor.
Here is some of our conversation:
Driving into the parking lot of Domino’s Farms, the building is still stunning. How do you feel about the building today?
“I’m quite happy with it. There are minor things … but I’m quite happy with it. The composition of it; the way it blends in with the site; the materials, the copper, the brick.”
How is it different from where you started?
“It’s completed. And that was a great feeling.”
Monaghan related how he’d been set to build on the other side of U.S.-23 when he was persuaded by Paul Raeder to consider the existing property – which had been planned for a subdivision.
“It was bigger, and we could control the environment around it more, and even more expressway visibility because you have M-14, which wasn’t much back then, but … it just made sense.
He expected to have about 1,600 acres, but at one time had over 2,000 acres, including land north of M-14.
“It was about a couple thousand (dollars) an acre (for about 90 acres of the property). I didn’t really have a use for it but I thought well, for that price, I might as well take it because what we’re doing here is of such a scale, it’s going to impact the value of everything around it.”
Over the last decade we saw a tremendous land rush in Ann Arbor. What was the climate like for land back then?
“When I bought this there was an economic lull. In fact, a big housing company … had planned to build quite a few homes on this property. Because of the housing slowdown, they pulled out … It was a very receptive welcome that I got from the township. It changed after we were committed.”
“They committed to us verbally … (but) one issue that’s coming back to memory now is the amount of retail that we could have in here. I wanted to have a situation where retailers could afford to be here. It was going to be a big building, with a lot of clientele for a retailer, but I wasn’t sure it was going to be enough by itself to bring in top retailers and I wanted to be able to have enough … not like a shopping center, but services … there seemed to be a big issue about that. They came up with a number that was not in the spirit of what we’d discussed.
Why build at all?
“I was getting tired of moving. Dominos was growing so fast. In the ’80s we were the fastest growing restaurant chain in history. We went from 300 to 5,000 stores from 1980 to 1990 – we opened up 954 stories in 1985. Our problem was, we kept running out of space, no matter what location we were in. We moved probably every other year – sometimes we had multiple locations, which was really difficult, in different parts of town.
“I also wanted room to expand. That was the idea of having other tenants in the building. And that would enable us to have more amenities for our people. Cafeteria, fitness center, other retail spaces. As we grew, those other tenants could move out and the pizza company could pick up the space and at some point build the tower. That was the plan – and at the same time controlling everything around it. It was a rural – urban environment.
“And we wanted to sell pizzas, too. We wanted it architecturally significant enough like the Johnsons Wax tower or John Deere headquarters or something. It was a consumer business.”
The Golden Beacon tower, a Frank Lloyd design that never was built, was planned for the property.
“But when we got into the design of it, with the codes changed so much, you couldn’t build that building. It was pencil thin – that was part of its appeal. It was designed as a residential building. To convert it to office, you had to have an extra set of stairways, extra elevator – so for the amount of square feet you’d have for each floor, there wasn’t much for (office) use.”
So it never happened.
“No. If I had kept the pizza company, it might have happened, but that’ s the only justification for it. It would sell pizzas. … The corporate identity, it would be unique enough that it would have attracted some attention.”
Does this building make sense from a corporate perspective?
“Yes. Every time I go by this building or approach it, I’m taken aback by the awesome view and scale. Over the years, the landscaping has softened the lines of the building … it looks like it was here forever. It looks like it belongs here.”
People must have told you that it was too expensive.
“Yes. On the landscaping in particular. … I did not cut back on the landscaping. Someone told me it might have been the most expensive landscaping project in the history of the state, but I don’t know if it’s true or not.”
The building took shape in phases, with the sixth and final – “The Connector” – completed in 2005.
Monaghan reminisced about phase five, in 1991, when the pizza company was experiencing problems and construction started on spec – and then he lost the construction financing.
“That was probably the single biggest setback I’ve had was in that downturn back then.
“We just put plywood up, we didn’t think it would take long to do the final phase. But it took almost 15 years. The original plan wasn’t to take 20 years – it was to take three to four years at the most and build the tower right after that.”
You were so involved in the design aspects of the building. How did you balance that with running this fast-growing pizza company?
“I had good people. I’d been in the business so long; I’d made every mistake in the book. Not many people have an understanding of their company like I did. I started it, I went through all the pains of up and down and growing it … I only got involved in the conceptual part, the planning.
“…. Except I saw my office and thought, “That looks pretty good, but I can do better than that.” I can’t afford to get involved in every detail in the building, we did have a world-class architect on it. But for my office, I wanted to do that myself … I had more fun.”
And it was in the Frank Lloyd Wright style?
“Sure. That’s all I know. I don’t get off into areas of architecture that I don’t know. And this is one that I know better almost than anyone. I like him and I think other people like him when they’re exposed to it.”
Was that painful for you?
“I thought it was kind of a shame, but I didn’t worry about it too much.
“The bathroom was spectacular. It had the world’s most glorious urinal. So much so that I never used it. I understand when President Ford came here, he used it.”
Monaghan has specific memories of the Palmer House, the home in Ann Arbor designed by Frank Lloyd Wright and now on the market, listed by Bob Eckstein at Edward Surovell Realtors for $985,000.
“I knew the Palmers well. Many years ago, I tried to buy the house (as a recruiting tool for the University of Michigan College of Architecture)…
“Their house sits on the site so beautifully. And the garden that Bill Palmer did was spectacular.
“… I think it’s one of the best cared-for Frank Lloyd Wright homes. … when I was a kid I used to drive out there all the time. I had a Sunday morning New York Times route in that neighborhood. I’d drive up to that driveway and just stare at the house … It really sits there quite nice. And I’d drive around the back, where I could see the big, cantilevered roof sticking out.
“It became a Sunday ritual for me. One time I got the nerve to knock on the door and ask if I could see the inside of the house. Mrs. Palmer was not too polite.”
Monaghan’s vision of creating a Catholic community didn’t progress in Washtenaw County, where he established Catholic schools from elementary through Ave Maria College and Law School. He turned to the Naples area, where Ave Maria Town is now in process, with partners such as Pulte Homes, contracted to build 8,000 homes.
The financial arrangement is complex, with Monaghan’s development arm driving the project even as his faith-based foundation forges the ground for the higher education component.
Monaghan said his fund-raising efforts for the school have yielded $50 million from 45,000 donors.
While he’s in Florida, he mostly stays in the dorms, giving him a presence on campus.
“We ended up finding this piece of property outside of Naples, it was just under 11,000 acres, and they offered us free land – as much as we need, if we build our campus there. At first I turned them down, I thought it was too far out – but after I spent some time around Naples and I saw how it was growing out that way anyhow, I thought we’d better take it.
” I asked them to sell us 50 percent of the remaining land so that we could be the beneficiary of the value gain on the property. So we bought at current agricultural value. We got 930 acres for the campus and 9,900 for the town and the partnership.
Is it bigger down there than what was envisioned here?
“Let’s put it this way: I can talk about it getting bigger – here it would scare the township away. Here we were talking about a little more than 3,000 (homes) – there we were talking about 5,000, 5,500. If you’re going to be a world-class university, you need to be a certain size.”
What’s happening there today?
Monaghan cited resistance from faculty, resulting in the lawsuit against him that continues. But he also points to student population growth.
The town itself is proceeding slowly. A Publix supermarket is under construction, but a bank recently pulled out of a deal to establish its headquarters there. And home sales have dropped to a handful a month – a total of 250 have been sold.
“We also picked the worst possible time to build buildings. We had hurricanes and booming growth – you just couldn’t get the subcontractors. We ended up paying double over a three-year period from what our original bids came in at. We had to cut back on what we build – we still don’t have a gymnasium.”
How do you describe your work today?
“Help as many people as possible, particularly through the university, which I hope will be a beacon and a model for other Catholic universities. By and large, most of them are in financial straits – and they’re afraid to be too religious.”
I’m curious about the business aspect, which you’ve grown so much, but also the faith aspect of your life – and their intersection. How much time do you spend thinking about the foundation and its business and your natural business leanings versus anything more faith-directed?
“The business aspect – the university would fill the business classification. They all go together. I go to Mass every day, I say at least four rosaries while running … every meeting we have at the university and the foundation starts with a prayer. We have morning and evening prayer.
“Business-wise, I spend as much time as I did with Domino’s – I’d say quite a bit more. I’m working harder than now than I did in the last 10 years at Domino’s, but it’s more fulfilling and meaningful. I’m 71 years old, soon to be 72, and I’m not looking forward to anything in the way of leisure, anything the world has to offer
“…Virtually every evening I’m doing something for the university. It’s either a fund-raising event or a university event, or it’s a community event that my presence is important to be at.”
Monaghan’s interest in architecture clearly went beyond buildings into urban planning, from the Domino’s Farms site to Ave Maria. In between, he also owned the Detroit Tigers, giving him a chance to explore options in Detroit.
Much of the reason appeared to be business-related: A well-designed building was a showcase for his pizza business. And a vibrant area near Tiger Stadium could have fueled sales for his team.
“I was really excited when I bought the Tigers. I thought the stadium was a shrine. And I wanted to restore it. … it had a lot of historical significance and it meant a lot to me…. I wanted to buy the property around it and develop the whole area, sort of a Tiger Town North.”
That included some property purchases, such as the former St. Boniface Church.
“That’s all I was able to get. I wanted to … buy up all of the homes in Corktown across the street and make them chalets (for corporations to buy) because we didn’t have the opportunity for a lot of suites like most stadiums.”
Monaghan’s time in the public eye in Ann Arbor has faded. He spent years running a national business near the city, but today isn’t personally connected to many of the local or state issues.
His focus, he says, is creating “something that’s more meaningful and eternal for more people.”
When Ann Arbor considers Tom Monaghan, what do you want them to think about?
“I don’t think I really think about it or really care.”