City OKs deal with Gilbert for old Hudson’s site

Louis Aguilar
The Detroit News

In the second huge development deal of the day, billionaire Dan Gilbert finally reached an agreement with the city of Detroit to build a modernistic high-rise retail and apartment complex on one of downtown’s landmark empty spaces: the former J.L. Hudson’s site on Woodward.

The pact was approved Wednesday afternoon by the board of the city’s Downtown Development Authority, DDA, after months of delay. The deal was announced about an hour after Gilbert said he intends to invest $1 billion to build a downtown stadium for a new Major League Soccer team.

A Gilbert-affiliated entity has held development rights to the Hudson’s site since 2010. The new deal estimates the project will start construction by April 1, 2017, and be substantially finished by April 1, 2020. The agreement will be submitted for City Council approval with the next three weeks.

“Today, we took a historic step forward,” Mayor Mike Duggan said after the vote. “It’s been a painful thing to watch that site with no activity for 33 years. We’ll have drawings by the end of the year; break ground one year from now on a high-rise apartment building with a minimum of 250 residential units, 225,000-square-feet of commercial space.

“Woodward has been coming back to life but this will speed up that process,” Duggan said.

Gilbert also has committed to an affordable housing agreement that says 20 percent of residential units will be available to moderate-income people. But that 20 percent goal will be spread over the next 1,350 rental units developed by Gilbert, which means other developments will be included to reach that 20 percent goal, according to the city.

Part of the Hudson’s deal includes allowing the Gilbert-affiliated entity, Rosko Development, to buy a 900-space parking garage underneath the site for $15 million.

Many details are still unknown about what will eventually end up on the old Hudson’s site. The final designs of the apartment complex aren’t complete, the cost of the project is still unknown, what kind of retail and offices will end up there has not been revealed and neither have the details of “civic programming” that’s part of the deal.

That “civic programming” — whether it’s an amphitheater, a downtown campus for a university or another public space — is one of the reasons the deal has been delayed, according to past statements by city officials and representatives for Gilbert. That uncertainty has made it more challenging to make the entire project financially sound.

“We want to make sure we get everything right,” said Matt Cullen, president and CEO of Gilbert’s Rock Ventures, said on Wednesday. “The uses are pretty straightforward, there’s going to be residential, there’s going to be retail, there’s going to be some community gathering spaces. But the mix is important.”

The site is where the former Hudson’s department store on Woodward once stood. It’s bordered by Woodward to the west, Farmer to the east, East Grand River to the north and Gratiot to the south.

After holding an international contest to choose a building design for the side, Gilbert didn’t select a winner and moved to hire a highly acclaimed New York architecture firm, SHoP.

Gilbert is founder and chairman of Rock Ventures and Quicken Loans Inc. The Hudson’s flagship store on Woodward closed in 1983 and the 25-story building was imploded to clear the block Oct. 24, 1998. Since then, the site has been empty except for the underground municipal parking garage.

Opened in 1911, Hudson’s was the flagship store of the former department store and eventually grew to more than 2 million square feet and 32 floors. At one point, it was the tallest department store in the world.

Gilbert, through various entities he owns, rivals General Motors as the largest private land owner in downtown Detroit. His Bedrock Detroit real estate firm controls more than 90 properties, the vast majority downtown, that amounts to 14 million square feet of space.

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