Michigan

Detroit Seeks Economic and Community Development Benefits in Brewster Wheeler Restoration

Eight months after Detroit’s historic Brewster Wheeler Recreation Center was scheduled to be demolished, Mayor Mike Duggan stood in front of it with boxing legend Joe Louis, Jr. to announce a $50 million restoration and redevelopment plan.

Brewster Wheeler Recreation Center in Detroit, MI

Brewster Wheeler Recreation Center in Detroit, MI (photo – Dave Hogg/flickr)

Not only will the project save the building, but will also include Detroit economic development plans to restore the historic neighborhood with 100-150 housing units, a restaurant and other commercial spaces supporting at least 500 new jobs.

Not to mention a kitchen incubator, a culinary arts training program focused on at-risk young women, space to house a bike-friendly non-profit organization, and community and meeting space.

The iconic building will retain its rich heritage with a new restaurant built on top, so that people have the chance to dine in Joe Louis’ former training facility atop what was at one time the Harlem Globetrotters’ basketball court floor.

A bar in another section of the building will likewise honor Leon Wheeler, who became Detroit’s first African American recreation worker in 1919 and managed the Central Community Center (now the Brewster Wheeler Recreation Center) from the time it opened in 1929 until he retired in 1945.

A team of developers, all with deep roots in Detroit, will be working on separate aspects of the project.

Union Joints, LLC is undertaking the restoration of the 51,780-square-foot building and addition of the new restaurant and bar. Apart from the restaurant, they will also establish a kitchen incubator, catering space, culinary arts studio, and community and meeting space within the Recreation Center.

This $10 million project is expected to create 300 new jobs, which will include 120 new full-time jobs. Keeping in mind the historic nature of the building, the project is also expected to provide more Detroit economic development benefits than the usual construction or redevelopment projects.

Under the terms of the agreement, Union Joints LLC is required to ensure that a major part of the benefits from the project go to Detroiters and Detroit-based firms. This includes at least 30 percent of the construction cost to Detroit-based contractors, and hiring of Detroit businesses for at least 51 percent of the construction and rehab of the restaurant parcel.

At least 40 percent of the restaurant jobs must initially be filled with Detroiters, and the number must increase to 70 percent within four years. Members of non-profit Alternatives for Girls, which supports at-risk young women, will be given priority to join the culinary arts training program, which will give them a chance to gain employment at the restaurant after they complete their training.

The agreement also provides space in the building for housing the new headquarters of non-profit organization Slow Roll, Inc. Slow Roll provides bicycles to people for bike tours of Detroit.

Develoopers RHEAL Capital Management and Schostak Brothers are investing $37 million to develop the southern part of the property into a mixed-use project that will include 100-150 multi-family housing units and new commercial space.

This project is expected to create more than 200 new permanent jobs, at least 35 percent of which will be filled by Detroiters. At least 51 percent of the construction jobs will likewise go to Detroiters, and 30 percent of the cost of construction will go to Detroit-based contractors.

Mayor Duggan said in a release announcing the project that every opportunity they have, they plan to preserve buildings like the Brewster Wheeler Recreation Center that have a deep personal history in the city, and do it in a way that provides real benefits to Detroit residents.

Wayne County, MI Approves Brownfield Cleanup Plan for Gibraltar Steel Plant

Ferragon Corp’s proposed $53 million steel plant project in the City of Gibraltar, MI passed a major hurdle with the Wayne County Commission approving a Brownfield cleanup plan for the site.

Wayne County, MI brownfield plan

Photo – waynecounty.com

Ferrous CAL Co., a subsidiary of Cleveland, OH-based Ferragon Corp, has already purchased the 42.34 acre former McLouth Steel plant site in Gibraltar, and intends to produce steel for automotive companies.

The company is planning to invest more than $53 million on the project, and expects to create at least 100 jobs at the facility. There are already 15 existing employees who still take care of the site, and Ferrous CAL Co intends to hire them too.

The investment includes a significant amount that will be spent on environmental activities, asbestos and hazardous materials removal and interior demolition.

The plant location close to the Detroit River International Wildlife Refuge, the Detroit River, marshes and other wetlands makes environmental issues especially sensitive. The Frank and Poet Drain flows onto the property.

There have already been major cleanups in the area, including at the federally owned refuge, that have been undertaken jointly by the government and industry.

The site in question was operated as a steel plant by McLouth Steel from 1954-75. In 1995, the mill occupants went into bankruptcy and operations were entirely terminated. The mill remained vacant until 2000 when Detroit Cold Rolling began operations.They operated the mill for three years until 2003, at which time the mill operations were once again halted.

The site has been unused and mostly vacant since then, and a subsurface investigation in May 2006 found the soil and groundwater to be contaminated.

The Wayne County Economic Development Department has been working with Ferrous CAL on the project and cleanup plan. The brownfield plan has already been approved by the Gibraltar City Council, Wayne County Brownfield Redevelopment Authority, and the Wayne County Commission’s Committee on Economic Development.

Wayne County Commissioner Joseph Palamar said in a release announcing their approval of the Brownfield plan that this is a terrific reuse of an inactive steel plant, and the jobs are most certainly welcome.

Brownfield plans provide economic development incentives specifically targeting projects that require cleanup of contaminated properties and subsequent reuse to promote economic growth.

In this case, full approval by the Wayne County Commission enables Ferrous CAL to be eligible for Tax Increment Financing (TIF) reimbursement of $9,902,502 in environmental cleanup costs on the site, the 600,000-square-foot industrial building and other structures on the site. This figure includes $509,165 for site preparation and infrastructure improvement activities.

Battle Creek, Michigan Economic Development Incentives Secure DENSO Expansion

The Michigan Economic Development Corporation announced grant awards for four business expansion and community revitalization projects that are expected to create 185 new jobs and generate close to $59.6 million in investments.

DENSO

DENSO (photo – densomedia-na.com)

The biggest project of the lot is an expansion by DENSO Manufacturing Michigan, Inc. (DMMI) in Battle Creek, MI. The company is investing $53.6 million and creating 100 new jobs at this facility.

As part of the expansion, DENSO acquired two buildings in the Fort Custer Industrial Park, increasing DMMI’s footprint to more than 1.3 million square feet.

This expansion is part of DENSO’s ongoing plan to invest nearly $1 billion in North America, including more than $750 million in the United States, for strengthening and expanding its manufacturing and product development infrastructure in the region.

DMMI is a subsidiary of DENSO International America, Inc., which in turn is a part of the Kariya, Japan-based DENSO Corporation. DENSO is a leading global automotive supplier with more than 200 subsidiaries and affiliates in 38 countries and regions who together employ nearly 140,000 people. In North America alone, DENSO has 28 manufacturing facilities and more than 17,000 employees, including 14,000 in the United States.

DMMI President Shingo Kuwamura, who is also CEO of DENSO Thermal Systems North American Center, said in a release announcing the expansion that this investment allows them to expand next generation manufacturing and testing capabilities, while also creating space for their training and leadership programs as they develop their employees’ next generation job skills.

The Battle Creek, MI facility was selected for this expansion over competing DENSO sites in Mexico, Ontario and Arkansas. To support the expansion, the Michigan Strategic Fund has approved a $640,000 performance-based grant for DMMI under the Michigan Business Development Program.

The project is additionally getting City of Battle Creek economic development incentives in the form of property tax abatement.

The other job creation project awarded state incentives is a relocation by NEMO Capital Partners, LLC. The privately-held investment company has a portfolio of health-tech holdings. Last year, the company consolidated operations from Ohio and New Jersey to a new headquarters building in Southfield, MI. Now they want to relocate another 50 jobs to the facility. The project has received MSF approval for a $250,000 MDB grant.

MSF approval of state assistance was also announced for two community revitalization projects. The City of Brighton, MI is getting $76,886 for the Yogurtopia project to renovate a vacant building into a full-use yogurt store. This project is generating a capital investment of $220,940 and creating 10 jobs.

The other community project is a renovation of four partially vacant, historic buildings in downtown Milan, MI. The project will retain the existing bakery on the premises while creating additional office and restaurant space, in addition to 15 new apartments on the floors above. This project is generating a capital investment of nearly $5.3 million and will create an estimated 25 full-time equivalent jobs.

The developers Wabash & Main LLC and Wabash & Main Properties Corp are supported in this project by state, local and federal incentives. The project has been approved to receive federal historic tax credits, and the City of Milan has approved a 10-year property tax abatement worth $404,000.

The project also received MSF approval for a $873,601 performance-based grant under the Michigan Community Revitalization Program, and is getting $967,200 from the Michigan State Housing Development Authority.

Michigan Department of Talent and Economic Development Launched

In December last year, Governor Rick Snyder had announced an executive order creating the new Department of Talent and Economic Development (TED).

This new department led by Steve Arwood, who is also the CEO of the Michigan Economic Development Corporation, has now been officially launched.

Video – MEDC

In a release announcing the TED launch, Gov. Snyder said that “This new department will accelerate the state’s effort to become a national leader in connecting highly skilled talent with in-demand jobs.”

Arwood said in the release that Michigan is rebounding and the governor’s vision will take them to the next level. “The launch of this new department is a critical step and we are ready to go,” added Arwood.

TED brings together MEDC, the Michigan Strategic Fund, and the Michigan State Housing Development Authority into one department, along with the newly created Talent Investment Agency (TIA) that was authorized through the same executive order.

TIA now includes the Workforce Development Agency, the Unemployment Insurance Agency, and Pure Michigan Talent Connect. The latter is the state’s labor exchange system.

The Unemployment Insurance Agency collects unemployment taxes from employers and provides unemployment benefits for workers who are unemployed through no fault of their own. The Workforce Development Agency supports a demand driven workforce system through an alignment of workforce and economic development efforts.

TIA, led by Stephanie Comai, formerly the deputy director of the MI Department of Licensing and Regulatory Affairs, will coordinate state workforce development and training programs.

The immediate priorities that TIA, working with other organizations within TED, will focus on for enhancing talent development include a review of the state’s entire talent system and creation of more broad-based messaging and outreach efforts. A comprehensive talent enhancement strategy that fits regional needs while benefiting Michigan as a whole will be developed.

An informational marketing campaign stressing the value of STEM education will be created. TIA will also work on implementing the Governor’s FY 2016 budget recommendations related to bridging the talent gap and better matching the workforce needs of Michigan employers.

“This team is poised to help Michigan prosper by engaging partners across the state with the bold goal of tackling the skills gap head on through innovative and effective workforce development programs,” added Gov. Snyder.

The website for the new Michigan Department of Talent and Economic Development is at michigan.gov/ted and the Michigan Talent Investment Agency website is at michigan.gov/tia.

Michigan Economic Development Support for Marquette Brownfield Redevelopments

The Michigan Economic Development Corporation announced MSF approval of three community revitalization projects, two of which are brownfield redevelopments in the City of Marquette.

Pure Michigan

Pure Michigan (photo – PunkToad/flickr)

The third project is a 13-story building renovation in downtown Grand Rapids. Together, these three projects will generate $225 million in investment and create 194 new jobs.

But the impact on City of Marquette economic development is going to be much bigger because the City’s Brownfield Redevelopment Authority is planning the redevelopment of a 37-acre property by demolishing existing structures and constructing the new regional acute-care DLP Marquette General Hospital and medical office building.

This project will generate a capital investment of at least $170 million, create 150 new jobs and retain 2,300 existing jobs. The Michigan Strategic Fund has approved over $55.76 million in local and school tax capture for the City of Marquette Brownfield Redevelopment Authority.

The other project that received MSF approval is the redevelopment of a brownfield site in Marquette by Liberty Way Hospitality, LLC. The company is redeveloping a blighted industrial baking facility into a mixed-use development that includes space for offices and residential properties, along with restaurant and hotel space.

This is a three-phase project involving a $20.4 million investment and will create 19 jobs. MSF has approved a $4.1 million loan for the project under the Michigan Community Revitalization Program loan for the construction of a second building, extended-stay hotel, residential facility and underground parking.

The City of Marquette is supporting this project with brownfield tax increment financing of more than $7.5 million.

Apart from these three community revitalization projects, the Michigan Economic Development Corporation also announced MSF approval of a bond issue to fund a $50 million grant program to boost skilled trades instruction.

Eighteen community colleges across the state have been selected to receive funding through the Community College Skilled Trades Equipment Program. Announced last year in October, this program aims to provide funding for Michigan community colleges to purchase equipment required for educational programs in high-wage, high-skill and high-demand occupations.

The 18 colleges receiving the CC STEP grants will be coming up with more than $21.5 million in matching funds. The colleges are also required to collaborate with school districts and provide a detailed plan on how the funding will be used to help meet employers’ workforce needs.

Gov. Snyder said in a release announcing the grant awards that this serious investment, one of the largest of its kind in the country, will tap top-notch community colleges in Michigan and help new students and adults looking for new opportunities gain the skills sought by companies looking to grow and expand, creating more and better jobs in Michigan.

Michigan Economic Development Corp Update on Tech Startup Growth

The Michigan Economic Development Corporation announced that the number of tech startup companies in Michigan has more than tripled in the past four years.

Pure Michigan

Pure Michigan (photo – PunkToad/flickr)

This according to the annual metrics report from the MEDC’s Office of Entrepreneurship, Innovation and Venture Capital.

The report says that 248 new technology companies were launched in Michigan last year.

It also reveals that an average of 240 companies has been created annually in the last three years, along with an average creation of 1,100 new tech jobs each year.

This growth in the number of tech startups parallels the growth in the number of venture capital firms in Michigan, which has grown to 35 firms in the last five years. Even as the number of venture capital professionals doubled in Michigan during this period, their numbers decreased by 13 percent at the national level.

MEDC Vice President of Entrepreneurial Services and Innovation Paula Sorrell said in a release announcing these figures that a general trend they’re seeing in the ecosystem is that venture capitalists dedicated to Michigan are moving to larger funds or into more senior positions, or both.

Sorrell added that they’re also seeing that traditional investment groups are now interested in venture capital investing, and the number of early-stage tech companies has been growing over the last three years. “People are starting to view Michigan as a great place to invest in Michigan tech companies,” said Sorrell.

Private investment in new tech companies in Michigan added up to $710 million last year. Comparing this to the amount spent by the Michigan Strategic Fund on tech entrepreneurship last year shows that small tech startups are raising $35 from private and federal contracts for every Michigan economic development dollar they get from the MSF.

This doesn’t just happen on its own. MEDC’s Office of Entrepreneurship, Innovation and Venture Capital (EVIC) works to leverage private funds into early-stage tech companies. One of these startups that received assistance is Plymouth, MI-based ProNAi Therapeutics, Inc. The company is developing DNA (DNAi) interference technologies for cancer treatments.

ProNAi received Michigan economic development incentives through the 21st Century Jobs Fund, along with additional support from other EVIC programs. They were subsequently able to close on $59.5 million in Series D financing, which allows them to continue Phase II clinical studies for a drug that is being tested on patients with non-Hodgkin’s lymphoma.

Michigan also has an Emerging Technologies Fund that provides matching funds to Michigan-based companies that have been awarded federal funding for exceptional research and technical innovation.

The state’s network of SmartZones is designed to incubate growth of technology businesses and jobs. Accelerators such as Detroit-based NextEnergy and Wayne State University’s TechTown support tech startups all the way from incubation to commercialization.

Many of the state’s tech startups are the result of research conducted at Wayne State University, Michigan State University, and the University of Michigan, which are collectively called the University Research Corridor (URC).

Sorrell said in the release that no other state does what Michigan does in funding an entire entrepreneurial ecosystem that supports innovative early stage companies.

Michigan Approves Incentives for Five Economic And Community Development Projects

The Michigan Economic Development Corporation announced approval of incentives for three business expansion projects and two other community development projects.

Pure Michigan

Pure Michigan (photo – Royalbroil/wikimedia)

The Michigan Strategic Fund approval for these projects supports the creation of 218 jobs and brings more than $24.3 million in investments to Michigan.

One of the three expansion projects is being undertaken by the Irwin Seating Company in the City of Walker, MI. The company specializes in manufacturing public seating for venues such as convention centers, arenas, auditoriums and movie theatres.

Irwin has two manufacturing facilities in North America – a seating division in Walker, MI and a telescopic platform and bleachers division in Altamont, IL. The company picked the Walker facility over a competing site in Mississippi for manufacturing a new recliner product for the cinema market.

They’re going to invest $1.9 million to repurpose 50,000 square feet of space in the Walker facility and provide training for new employees who must have specialized skills to handle the complex nature of the work.

This state is supporting the investment and the 60 new jobs being created by providing a $300,000 performance-based grant through the Michigan Business Development Program. The company already has more than 400 employees, of which 287 are located at the Walker facility.

The City of Walker is additionally considering approving a tax abatement to support the expansion. This project was assisted by West Michigan’s regional non-profit economic development organization The Right Place, Inc.

Win Irwin, President and CEO, Irwin Seating Company, said in a release announcing the expansion that the company was built in West Michigan and they are proud to be reinvesting in the community that has grown with them.

“We are particularly grateful that the Right Place and the State of Michigan were willing to partner with us on this exciting opportunity,” said Irwin.

The other two expansion projects that received MSF approval are automotive companies. Plymouth, MI-based LOC Performance Products, Inc., which manufactures driveline and suspension systems, is investing $12.1 million at its facility in Plymouth Charter Township and creating 95 jobs. LOC is getting a $600,000 MBD grant and additional property tax abatements from the Township.

NHK International Corporation, a subsidiary of Japanese suspension springs manufacturer NHK Spring Co., Ltd., is investing $9 million to purchase a building in the City of Novi, MI for its headquarters and R&D center.

The company will be creating 26 new automotive research and engineering jobs as part of the headquarters relocation and expansion project. NHK is getting a $150,000 MBD grant, and the City of Novi is further supporting the project by providing funding for permit fees.

Two other community development projects received approval for CDBG funding. Neuvokas Corporation’s expansion project in the Township of Allouez received $275,000 in CDBG funds for on-the-job training for new employees. The company is investing $1.3 million and creating 31 new jobs as part of an expansion.

The other project community development project is the Harrietta Hills Trout Farm expansion in Slagle Township. Wexford County was provided $210,000 in CDBG funding for this project, and the company is getting it as a working capital loan that will help them grow and create six new jobs.

Michigan Economic Development Corporation Executive Vice President and Chief Operating Officer Steve Arwood said in an MEDC release that the commitment of these companies to grow and create jobs in the state demonstrates the significance of Michigan’s greatly improved business climate and infrastructure.

Gov. Snyder Signs Bills Encouraging Detroit Economic Development and Job Creation

Governor Rick Snyder signed a slew of bills that includes legislation that will encourage Detroit economic development and job creation.

NMDC

NMDC (photo – michigan.gov)

The bills (SB 398 and HB 4783) allow the Michigan Strategic Fund Board to establish another Next Michigan Development Corporation zone for the City of Detroit.

Michigan already has five such NMDCs, and a sixth one for the Upper Peninsula has been approved through legislation passed in 2013. The creation of these NMDCs was originally authorized under the Next Michigan Development Act in 2010 to foster economic opportunities in the state.

Each NMDC that is created is authorized to grant economic development incentives to both new businesses as well as expanding businesses already located within the region it covers.

The NMDCs are strategically located industrial zones that support the development of businesses engaged in, relying on or supporting multimodal commerce. The NMDCs are able to deploy various tax-break statutes to promote logistics-related businesses around transportation centers. Businesses located in an NMDC may be eligible for property tax abatements and possibly also renaissance zone reductions of state and local taxes.

The five original NMDCs include:-

- Northern Nexus NMDC located within the Northwest Region of Michigan;

- I-69 International Trade Corridor NMDC located in the East Central Region of Michigan;

- Port Lansing NMDC located within the Central Region of Michigan;

- VantagePort NMDC located within Southeast Michigan; and

- West Michigan Economic Partnership NMDC located within the West Central Region of Michigan.

Both the Detroit and Upper Peninsula NMDC bills were sponsored by State Sen. Tom Casperson and State Rep. John Kivela.

In a statement issued after the bill signing, Gov. Snyder said that creating opportunities for additional economic development and investment helps continue Michigan’s growth and comeback.

“Adding a Next Michigan Development Corp. in Detroit will help create jobs and opportunities in the city as it moves forward,” said Gov. Snyder.

Apart from the bills that will allow the MSF to create the City of Detroit NMDC, the Governor also signed nine other bills, including House Bills 4481 and 4482. These bills, sponsored by State Representatives Harvey Santana and Frank Foster, respectively, are part of the legislation for updating the requirements for using of the 21st Century Jobs Fund.

The overall legislative package these bills are a part of is aimed at ensuring continued funding for Michigan economic development efforts including Pure Michigan ad campaigns, business development, job training and community revitalization programs.

Michigan Creates New Department of Talent and Economic Development

Governor Rick Snyder announced an executive order creating a Department of Talent and Economic Development and also the new Michigan Talent Investment Agency. The executive order also restructures several state departments.

Michigan executive order creates dept. of talent and economic development

Photo – michigan.gov

The aim of the reorganization is to put Michigan’s job creation and economic development efforts under one new department in order to leverage the state’s ability to build talent with in-demand skills while helping businesses in Michigan grow and thrive.

The executive order authorizes the director of the Department of Talent and Economic Development to be the new CEO of the Michigan Economic Development Corporation, subject to the MEDC executive committee making this determination.

The new director of the Michigan Department of Talent and Economic Development will be Steve Arwood, who is currently MEDC executive vice president and chief operating officer. Arwood will be a member of the Governor’s cabinet.

Current MEDC CEO Michael A. Finney will move into a new role as senior adviser for economic growth, as a member of Gov. Snyder’s executive staff.

The executive order moves the Michigan Strategic Fund and associated programs into the new department, along with the Michigan State Housing and Development Authority.

The MSF Board of Directors is abolished, and the new board will consist of the MEDC CEO or their designee, the Director of the Department of Licensing and Regulatory Affairs or designee, the State Treasurer or designee, and eight residents of the state appointed by the Governor with the advice and consent of the Michigan Senate.

The state Workforce Development Agency and the Unemployment Insurance Agency will be moved into the Michigan Talent Investment Agency. This new agency will coordinate all workforce training programs across the executive branch of the state government, including skilled trades training, employment assistance, and STEM training programs.

Stephanie Comai, who is currently the deputy director of the Michigan Department of Licensing and Regulatory Affairs, will be the director of the Talent Investment Agency and a member of the Governor’s cabinet.

In a release announcing the executive order, Gov. Snyder said that “One of my top priorities has been to make Michigan a national leader in talent development by focusing on workforce training for the jobs of today and tomorrow.”

The Governor added that this effort will require a comprehensive, unified approach to best help Michiganders while working to retain and attract businesses to create more and better jobs.

See the full executive order – No. 2014-12 (pdf)

Three Year Planning Effort Brings Pork Processing Plant With 810 Jobs to Coldwater, Michigan

Clemens Food Group will establish a new pork processing operation in Coldwater Township, MI. The company will make a $255.7 million capital investment to build the 550,000 square-foot facility, and expects the project to create 810 new jobs.

The Michigan Economic Development Corporation announced Michigan Strategic Fund actions to support the project, including $12.5 million in CDBG funding for the City of Coldwater.

Video – MEDC

The CDBG funds, which are supporting 644 out of the 810 jobs being created, will be used by the City for land acquisition, infrastructure improvements, and to provide workforce development and training support for the project.

The City of Coldwater is collaborating with Coldwater Township on a land transfer agreement that will enable the City to contribute $4.5 million to support infrastructure improvements at the project site. Including local incentives, the MSF CDBG approval and nearly $16 million in tax savings, the total support for the project adds up to around $55 million.

Clemens considered locations in both Michigan and Ohio for their Midwest expansion before selecting the Coldwater site based on state and community support, site feasibility and labor preparedness.

Governor Rick Snyder said in a release announcing the project that “The new project in Coldwater Township is agricultural entrepreneurism at its best with producers, the state of Michigan and local government working together to bring 800 new jobs to our state.”

The work done to bring this project to Michigan began three years ago, when the Michigan Department of Agriculture and Rural Development (MDARD) began working with pork producers in the state to consider the possibility of establishing a pork processing plant in Michigan.

MDARD awarded a $100,000 grant for a feasibility study. The producers and MDARD began pursuing a strategy to find a business partner with the requisite expertise for this project and establish a relationship with this partner that would benefit the pork industry in the state.

This feasibility assessment was one of the key components that led to Michigan’s pork processing partnership with Clemens Food Group.

MDARD Director Jamie Clover Adams said in the release that the project highlights the commitment and partnership by local and state officials, economic development groups and private industry to bring new companies and investment into Michigan.

MEDC President and CEO Michael A. Finney noted that these are significant jobs for the Coldwater community and the region, and added that they commend MDARD for its commitment to bringing this project to Michigan.

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