State OKs incentives for $215.3M in Detroit investments

Michael Gerstein
The Detroit News

Lansing — State officials on Tuesday approved millions of dollars in incentives to assist three companies in investing $215.3 million in Detroit.

The projects range from a new facility for a steel manufacturer near I-94 to the restoration of a hotel to a seat manufacturer moving its North American headquarters to downtown Detroit. The projects are expected to create 265 jobs.

“This is amazing for Detroit,” said Michigan Economic Development Corp. CEO Steve Arwood. “I think working with the city of Detroit, very closely with the mayor’s office, they’ve had a vision for filling in that I-94 Industrial Park. It wasn’t very many years ago that was completely empty.

“That’s just a very big deal to begin filling that in. And not only that, they’re very high paying jobs.”

The largest investment of the three companies will come from Johnson Controls spin-off Adient to relocate its operational headquarters from Plymouth to Detroit.

The global automotive seat manufacturer plans to invest $97.8 million and create 115 new jobs as part of the move.

The project was awarded a $2 million Michigan Business Development Program performance-based grant by the Michigan Strategic Fund board.

“We will take these incentives into consideration as we make a final location decision in the next several days,” said Adient Chairman and CEO in a statement. “We look forward to a continued partnership as we expand our presence and bring new jobs to the area.”

The company is expected to announce the location of the facility next week in Detroit.

Crain’s Business Detroit earlier this month reported Adient planned to move into the Marquette Building at 243 W. Congress. David Roznowski, an Adient spokesman, previously told The Detroit News the building — located across from Cobo Center — was one of two locations in downtown Detroit that the company has scouted out.

Adient, like Johnson Controls, is domiciled for tax purposes in Ireland. Corporate offices outside Metro Detroit are in Milwaukee; Burscheid, Germany; and Shanghai, China.

Metropolitan Hotel Partners LLC, a joint venture between Detroit-based Means Group and Roxbury Group, plans to invest more than $34 million to redevelop the historic Metropolitan Building on John R St. into a mixed-use extended-stay hotel that will include 110 rooms, retail space and meeting facilities. The project is expected to create 30 jobs.

"This is about more than brick and mortar,” said Eric Means, founder and CEO of the Means Group, in a release. “This breathes life into downtown Detroit and is strong evidence of the commitment the state has to preserving an important piece of history in urban America."

Redevelopment of the Neo-Gothic, 98,000-square-foot hotel, which opened in 1925, was awarded a $6.4 million Michigan Community Revitalization Program performance-based loan by the state.

The city of Detroit also is supporting the project with a $6.7-million Obsolete Property Revitalization Act tax abatement.

ArcelorMittal Tailored Blanks — a subsidiary of one of the world’s leading steel and mining companies, ArcelorMittal — plans to lease and renovate a 317,000 square foot building in the I-94 Industrial Park.

The facility will house welding equipment for the production of high-strength steel laser blanks. The project is expected to generate a total capital investment of $83 million and create 120 jobs.

The Michigan Strategic Fund board approved a $2 million performance-based grant for that company.

“Having Adient and ArcelorMittal locate in Detroit deepens and broadens Michigan’s rightful claim as the global auto capital,” Arwood said.

Separate from the Detroit investments, the board also approved a Renaissance Zone designation for the American Center for Mobility and Willow Run Arsenal of Democracy Landholdings Limited Partnership for 15 years in Ypsilanti Township.

The state estimates estimated that on average $1.85 million will be abated annually in property taxes, which will be partially offset by a Payment in Lieu of Taxes agreement between Ypsilanti Township and the companies.

A groundbreaking ceremony was held Monday for the long-anticipated facility, which will serve as a state-of-the-art global center for testing, education and product development for connected and automated vehicles.