Bedrock Sakthi purchase includes former Southwestern High School
Dan Gilbert's Bedrock real estate arm has purchased the vacant Southwestern High School as part of its acquisition of the former Sakthi Industrial Campus along West Fort, officials confirmed Wednesday.
The school at 6921 W. Fort Street has been closed since 2012 and had fallen into a state of disrepair. The building sits in the same block as the former Sakthi Automotive Group USA plant and is part of Bedrock's purchase of the 37-acre site that includes 529,000 square feet of industrial and manufacturing space, 89,000 square feet of office and flex space.
In 2015, Sakthi had announced plans to redevelop Southwestern High School for an advanced manufacturing facility. But the work never happened.
Bedrock has said this week that the deal, whose value was undisclosed, is its largest development outside of the city's Central Business District. It said the property allows the company "an opportunity to provide functional warehouse, distribution, and manufacturing space " close to downtown Detroit.
The property is also "attractive to regional and national companies that serve an international clientele," Sam Hamburger, vice president of acquisitions and leasing for Bedrock, said in a statement Tuesday.
While the industrial real-estate market slowed in the first few months of the novel coronavirus pandemic, developers are now latching on to new opportunities, according to a second-quarter market report by real-estate firm Newmark Knight Frank.
"In wake of the COVID-19 crisis," the report says, "developers are seeing a new market opportunity as the demand in the e-commerce industry is expected to grow, as people grow reluctant to shop at traditional brick-and-mortar stores." The report notes that Amazon.com Inc. continues to expand its presence in the region.
Between April and the end of June, industrial market vacancy in Metro Detroit climbed 40 basis points to 4.4%, according to NKF. Industrial properties in the Detroit market fetched an average asking rent of $5.97 per square foot.
MOBIS, an automotive parts supplier for Fiat Chrysler Automobiles NV and Hyundai, is currently the only tenant on the former Sakthi property.
Bedrock mostly has centered redevelopment projects downtown, though its radius has begun expanding. Last year, it opened up leasing at The Assembly, a $39 million mixed-use building in Corktown whose property Bedrock purchased in 2016. The real estate firm owned by GIlbert also acquired a warehouse in the shadow of the former Detroit Central Depot that is being renovated by Ford Motor Co.
Southwestern is not the only former Detroit school that has exchanged hands recently. Dakkota Integrated Systems last year purchased for $2.6 million Kettering High School and Rose Elementary School on Detroit's east side near Fiat Chrysler Automobiles NV's new assembly plant. Dakkota announced plans to open a $55 million parts factory.