Detroit — The years-long effort by Wayne County to finish its partially built jail in Greektown has come down to whether officials will embrace another blockbuster downtown development or take what they may view as a safer choice of completing the jail.
On Wednesday, billionaire businessman Dan Gilbert submitted a revised plan to build a criminal justice complex for the county with a 2,280-bed jail that will cost at least $520 million on a different Detroit property near Interstate 75 than he initially proposed last year. But the county also would be responsible for $380 million of the project plus the cost of acquiring the land from the city.
That complex would allow Gilbert’s Rock Ventures to build in Greektown another multimillion development that includes three high-rise buildings and potentially an MLS soccer stadium. That development could have more than $2.4 billion economic impact for construction of both sites, the company said.
Also on Wednesday, Gilbert’s competitor, Chicago-based Walsh Construction, pitched its plan to complete the existing Greektown jail site with two options: one has 1,608 beds at $269 million and the other calls for 2,200 beds at $317.6 million.
Now it’s up to Wayne County Executive Warren Evans to decide which deal is better. He has stressed the chosen plan can’t put county taxpayers at risk.
“It’s not about soccer, and it’s not about politics,” Evans said in a statement. “It’s about a county, with very real fiscal limitations, financing a desperately needed jail, which has already cost taxpayers millions.”
Evans plans to make a decision by late July.
The competing bids are symbolic of two different visions for the booming downtown. Gilbert seeks more marquee development while county officials say Rock Ventures has yet to prove its idea doesn’t put county taxpayers at risk by moving the jail elsewhere.
Rock Ventures’ plan calls for the criminal justice complex to be built on separate land owned by Detroit adjacent to its formerly proposed location on East Forest. The new proposal would build the complex, including the jail, on a 13-acre property that is bounded by the I-75 Service Drive, East Warren, East Ferry, Russell and Frederick. The site currently houses administrative offices and bus maintenance facilities for the Detroit Department of Transportation.
Rock Ventures’ bid didn’t put a price on buying that DDOT property. But a commercial real estate analyst said it’s an expensive proposition.
“An industrial/warehouse property like that is very prized property,” said John DeGroot, a research analyst for Newmark Knight Frank, which is a commercial real estate advisory firm. “It’s valuable because there is about 1 percent vacancy rate in the area for that kind of facility.”
The city would have to find another space to move its DDOT facilities, assuming it doesn’t own an existing space it has in mind, DeGroot said.
Gilbert’s criminal justice complex would have a jail, criminal courthouse, prosecutor offices, sheriff administrative offices and a juvenile detention facility.
“We are confident” about the new proposal, said Matt Cullen, Rock Ventures principal. “We will build you a new $520 million criminal justice complex, and the city will end up with another beautiful new development” in the current jail site, he said.
Once Evans decides on a proposal, the county will then negotiate a contract and send it to the Wayne County Commission and Wayne County Building Authority for approval.
“The goal was to provide the county with alternative solutions to the jail project, and we’ve done that,” Evans said in a statement. “We’re finally able to fully evaluate the proposals and pursue what’s best for Wayne County.
“... Just like everyone else in Wayne County, I’m tired of talk. I want the jail project resolved.”
County spokesman Jim Martinez acknowledged there are benefits to Rock Ventures’ proposal with new criminal justice buildings and a soccer stadium. However, Evans needs to determine what the county can afford to finance long term, Martinez said.
Wayne County Commission members say they’ll await Evans’ recommendation.
“We’re deferring to the (county’s) administration to do some due diligence on the two options, and we’re waiting for the county executive to make a recommendation, which should be in a few weeks,” Chairman Gary Woronchak said after the commission’s full board meeting Thursday.
City officials say they are willing to consider Rock Ventures’ offer to build the jail complex on the DDOT property. But city spokesman John Roach said Detroit has not determined the cost of that land.
“Any proposal also would have to consider the unique replacement needs of a facility like this one, which must be able to accommodate a large number of city buses, many of which are 60-foot-long, articulated vehicles,” DDOT Director Dan Dirks said. “However, our first consideration for any proposal is that it not negatively affect taxpayers or DDOT customers.”
Cullen said the new proposed jail site “has more options and scale.” He added the city informed Rock Ventures it was looking into consolidating DDOT facilities and that space may be available.
Rock Ventures’ latest bid is a bit fluid about the MLS soccer and stadium part of the deal.
“We are going to be creating very significant development that may or may not include an MLS project,” said Cullen, referring to Major League Soccer, the U.S. pro soccer league.
“We are going to move forward whether MLS is there or not.”
The official bid also puts building a stadium in flux by saying the development could have “potentially a Major League Soccer stadium.”
Rock Ventures originally proposed a 1,600-bed jail with a criminal justice complex on East Forest. The county would be on the hook for the first $300 million of that project, which was estimated to cost $420 million. Rock tossed in an option to increase the jail to 2,000 beds if the county paid an additional $43 million.
After that proposal was submitted, the county’s administration said it worked with key stakeholders to vet the plan and advise Rock Ventures on what it needed to change to meet the county’s needs. Rock Ventures took those recommendations and created the revised proposal, county officials say. The original proposal is no longer on the table.
Rock Ventures anticipates the criminal justice complex would be completed by Nov. 5, 2020.
While Rock Ventures worked with the county to revise its plan, Walsh received two deadline extensions to submit its proposal.
It was no surprise that Rock Ventures turned in its new plan on the same day as Walsh, Martinez said.
“It was made clear that we needed to be reviewing these proposals at the same time,” Martinez said.
Walsh said in a letter attached to the proposal that the company met weekly with county stakeholders, including the sheriff’s department and facilities department.
The company expects its jail project to create “countless” jobs for the local community.
“Delivering a project of this significance to Wayne County is a unique opportunity to adaptively reuse the existing construction site and materials while simultaneously developing a state-of-the art correctional facility in an economic method,” Walsh said in a letter to the county dated Wednesday.
Walsh’s proposal said construction of the jail would be complete by Aug. 31, 2020. The company wants to maximize the use of existing materials and equipment stored by Wayne County from the failed project, according to the proposal.
Peter Doherty, a spokesman for Walsh, declined to comment further on the plan when reached by email Thursday.
Officials have said the county will seek bonds to pay to complete the Greektown project. The county also has about $50 million in unspent bonds from the previous project.
In 2011, Wayne County began construction on its then $220 million jail project, when Robert Ficano was Wayne County’s executive. The 2,000-bed project, across the street from the Frank Murphy Hall of Justice, was stopped June 2013 after $100 million in overruns and charges of corruption.
About $151 million was spent in construction, acquisition and design of the jail, with much of the work done underground, according to officials. The half-finished jail has sat unused at a cost of $1.6 million a month, county officials estimate.