MEDC grants semiconductor wafer maker $6M for site near Bay City

Breana Noble
The Detroit News

Michigan's quasi-government economic development agency on Tuesday approved nearly $6 million in incentives for a semiconductor wafer manufacturer setting up shop near Bay City.

SK Siltron CSS LLC's plan to invest almost $303 million in Monitor Township comes amid a global scarcity of semiconductors that has shutdown auto plants and led to shortages of new vehicles and other consumer electronics. The Auburn-based subsidiary of Korean conglomerate SK Group expects to hire up to 150 people from semi-skilled operators to engineers as a part of the rehabilitation and expansion project.

A scientist at SK Siltron CSS holds a silicon carbide wafer produced at the company's Michigan facility. The company plans to expand its Michigan operations to increase production of these wafers, which can be used in power system components for electric vehicles.

The Michigan Economic Development Corp.'s governing body also approved incentives for mixed-use buildings in Detroit's Corktown and Lafayette neighborhoods.

"Today’s actions show our continued focus on jumpstarting Michigan’s economy by creating good-paying jobs, building on our state’s advanced manufacturing and tech sectors, and supporting transformational placemaking efforts in communities,” Gov. Gretchen Whitmer said in a statement. “These projects are further proof that Michigan is a place where technology, research and innovation are paired with a fierce work ethic that creates economic opportunities for businesses of all sizes.” 

The Michigan Strategic Fund Board granted a $1.5 million Michigan Business Development Program grant for the semiconductor project. It also approved a 100% exemption for up to 15 years of the State Essential Services Assessment required of manufacturers that do not pay personal property tax on eligible property. The exemption is estimated at $4.488 million.

Additionally, Monitor Township anticipates approval of a real property tax abatement in support of the project in conjunction with an MEDC-approved state education tax abatement.

SK is required to hire at least 100 people at the site and is working with Delta College. The purchase and renovation of the 140,000 square-foot site will allow for the production of silicon carbide wafers, a type of wafer the company's parent does not make. Anticipated to be 6% to 13% more energy efficient than other silicon wafers, the silicon carbide wafers are desirable for electric vehicles and 5G connectivity.

"SK Siltron CSS is proud to partner with the State of Michigan to build the supply chain and create the skilled jobs required to support the next generation of EVs," SK Siltron CSS CEO Jianwei Dong said in a statement, "ensuring Michigan remains the automotive center of the world.” 

SK is one of three companies in the U.S. producing the product, according to the MEDC, and has a 5% to 10% market share after the acquisition of DuPont de Nemours Inc.’s Silicon Carbide Wafer last year. The Company has 107 employees in Michigan with annual revenue of $10 million to $25 million.

SK Group is investing $10 billion into the U.S. for increased wafer production, EV batteries and life sciences. Some of that has gone to Georgia. It needs assistance in Michigan for talent attraction compared to locations in North and South Carolina, Tennessee and Texas, according to the MEDC.

“The company’s investment in Michigan is a clear example of how top attraction projects are finding opportunities to grow in the state underscoring Michigan’s leadership position in electric vehicle R&D and manufacturing," MEDC CEO Quentin Messer Jr. said in a statement.


The MEDC also approved $5.034 million in state tax captures for eligible brownfield redevelopment costs for the construction of six new five-story mixed-use buildings totaling $133 million on a vacant 5.2-acre parcel in Detroit's Lafayette neighborhood east of downtown. The project is by Lafayette Acquisition Partners LLC, which was established in 2018 by a group of real estate development investors and contractors.

Rendering of the mixed-use buildings for the Lafayette neighborhood project.

Three of the six buildings include for-rent apartments along Chrysler Drive. Two will include condominiums along Rivard Street. A third condo building will be at the center of the northern portion of the property. Each will include parking decks with 272 spaces and amenities, including a pool, clubhouse and greenspace.

The mixed-use development will be off Chrysler Drive in the Lafayette neighborhood.

There will be 230 studio, one-, and two-bedroom residential apartments; 88 studio, one-, and two-bedroom residential condominiums; and six 600-square-foot commercial spaces across the property.

Approximately 20% of the rentable residential units will be affordable, meeting the 80% area median Income threshold. The apartments will be marketed at rents between $1,229 for a studio and $2,876 for a two bedroom, with an average of $2.88 per square foot. Condominium units will sell for $475 per square foot, or $216,000 to $585,000 per unit.

Rendering of the mixed-use buildings for the Lafayette neighborhood project.

The project also is expected to receive an estimated $12.72 million as a local portion of brownfield tax increment financing and $9.47 million in support over 15 years with a Neighborhood Enterprise Zone certification. It is requesting $9.691 million in tax increment financing from the Michigan Department of Environment, Great Lakes, and Energy, as well.


The MEDC also approved $5.883 million in state tax captures over 28 years for eligible brownfield redevelopment costs for the demolition of an obsolete restaurant structure and construction of three mixed-use buildings in Corktown. Total costs is expected to be $92.03 million for the project on the 2.4-ace site that offers space for further redevelopment. The project is by Chicago's Oxford Capital Group LLC development entity in partnership with Farmington Hills' Hunter Pasteur Homes, which together are behind the Godfrey Hotel also in Corktown.

Rendering of the mixed-use project in Corktown.

For this next 313,830-square-foot project, one building will be a seven-story, 188-unit apartment building with ground floor retail and parking spaces. The second will include seven four-story townhomes each approximately 2,100 square feet with ground-level parking and a rooftop terrace. The third building will be a three-story, 216-space parking structure with 3,200 square feet of ground floor retail. At least 10% of the units will have rents targeting those at 60% of the average median income.

The mixed-use development will be located in Corktown along Michigan Avenue and Trumbull Street.

The existing business on the site will be retained as part of the development and located in a mixed-use structure. Residential units range from studio to three bedrooms at rents from $975 to $7,000 per month with an average of $2.80 per square foot. The developer expects returns of 5% over 20 years.

Rendering of the mixed-use project slated for Corktown.

Local support for the project includes an estimated $10.13 million in local brownfield reimbursement. The development team also is pursuing a 10-year, $10.62 million Commercial Rehabilitation Act tax abatement. Tax increment financing of $505,300 also is being requested from EGLE.

Twitter: @BreanaCNoble