Aerotropolis push attracts firms, jobs near Detroit

Nicquel Terry
The Detroit News

A development organization in Wayne and Washtenaw counties is renewing its efforts to use thousands of acres of vacant land near Detroit Metropolitan Airport to attract more companies to southeast Michigan.

The Detroit Region Aerotropolis Development Corp. already has secured nearly $350 million in investments and an expected 2,300 jobs from Amazon, Penske Logistics and Brose North America to set up operations in the area. Amazon and Penske will be in Romulus, where the airport is located, while Brose is expanding in Huron Township, about 10 miles from the airport.

The three companies are expected to begin operations within the next year. Officials say the companies are expected to generate about $68.8 million in tax revenue over the next 15 years.

The recent successes come after nearly eight years of little to no movement within the Aerotropolis organization. Consulting firms previously managed Aerotropolis but made minimal progress attracting companies, said Robert Luce, executive director of Aerotropolis.

Aerotropolis is now bringing companies to the area by not only marketing the 6,000 acres of land but also touting the location’s proximity to the airport, railways and freeways.

“We are bringing in corporate investment that results in new jobs,” Luce said. “We are powering the economy in southeast Michigan.”

Luce was hired in March 2017 and has been able to dedicate more time to moving Aerotropolis forward. The consulting firms were working only part time, or about 20 hours a week.

“Previously, we were more reactive ... but we weren’t out in the market actively prospecting,” Luce said. “Now we are generating leads; we are bringing companies to the table that might not otherwise have considered this location. So communities obviously find that very, very valuable.”

Aerotropolis, founded in 2009, is a public-private partnership that focuses on the recruitment of corporate investment and expansion in the immediate region surrounding the airport. Target communities are Romulus, Taylor, Van Buren Township and Huron Township.

Aerotropolis is a Next Michigan Development Corp. entity, giving it the authority to capture tax revenue from new developments and use the money to subsidize public infrastructure. The organization can also help companies get industrial property tax abatements.

Much of the land near the airport is zoned for commercial and industrial development. Luce said the region’s airports — Detroit Metro and Willow Run — five railways and major highways, such as Interstate 94, can be a draw for companies that transport goods.

Wayne County Executive Warren Evans lauded the work done by Aerotropolis, saying it has the potential to make the county “one of the world’s finest logistic hubs.”

“Luckily, we have a world-class airport and other transportation assets, but that doesn’t mean business is just going to fall in our laps,” Evans said. “We need the Aerotropolis to proactively market the opportunities in the region to help ensure we get more than our fair share of the new jobs and investment that are coming.”

The Aerotropolis is composed of several entities that fund its $500,000 annual budget and sit on the corporate board or executive committee — they include Romulus, Taylor, Van Buren Township, Huron Township, Wayne County, Washtenaw County, Wayne County Airport Authority and the Michigan Economic Development Authority. DTE Energy Co. and real estate broker CBRE are the organization’s private investors.

Luce announced the new partnership with CBRE on Thursday at the Aerotropolis annual meeting.

“We’ve supported the Detroit Region Aerotropolis Corp. since its inception, as we wholeheartedly support its mission to drive corporate expansion and new investments around Detroit Metro and Willow Run Airports,” said Jacqueline Young, economic development manager at DTE. “DTE Energy is one of the largest investors in Michigan’s economy, and partners with economic development agencies across the state to bring new business to the communities we serve.”

The $500,000 budget covers Aerotropolis’ marketing efforts, salaries and administrative costs, according to Luce.

He said the Amazon facility has been one of Aerotropolis’ biggest accomplishments. The online retailer is set to open a distribution and fulfillment center in Romulus this fall with 1,600 jobs and a $140 million investment.

Amazon’s new 855,000-square-foot facility is under construction and will be located at Ecorse and Vining, just north of the airport.

Aerotropolis will capture a portion of the tax increment revenues from the facility for the next 15 years, Luce said.

Those revenues will be used to reimburse the city of Romulus for the construction of Vining and improvements on Ecorse. Romulus took out a bond to cover the road project, which cost about $12.5 million.

Tim Keyes, director of economic development for Romulus, said Aerotropolis’ help with the road project near the Amazon facility was significant. With the construction of Vining and improvements on Ecorse, the city will now be able to market 300 acres of vacant land, Keyes said.

Amazon will also serve as a magnet for development opportunities.

“Aerotropolis for Romulus offers what I would call a national, international sales arm,” Keyes said. “They are out marketing on behalf of the city of Romulus and other communities every day.”

Additionally, Penske announced plans to build a 600,000-square-foot food-grade distribution center in Romulus just south of the airport, which will create 400 jobs. Its investment totals $98 million.

The facility is under construction and expected to open next year.

For that project, Luce said he helped Penske land a 10-year industrial property tax abatement.

Nate Barnes, director of real estate at Penske Logistics, said the company partnered with a developer, InSite Real Estate, for its project, which connected the company with Aerotropolis and Romulus officials.

“From a logistics and operations perspective, the site offers easy access to the main arteries and gives us the opportunity for expansion in the future,” Barnes said in a statement. “We felt the business-friendly environment in Romulus and the Aerotropolis would let us execute our project on an abbreviated timeline.”

Aerotropolis also wants to see existing companies in the region expand.

Brose North America, a German-based automotive manufacturer, announced in December that it would be doubling the size of its operation in Huron Township. That $105 million investment will result in the creation of 300 jobs, Luce said.

“In particular, Huron Township offers the tremendous benefits of easy access to airports, freeways and rail lines in good condition, at our doorstep,” said Frank Lubischer, president of Brose North America. “The Detroit Aerotropolis clearly highlighted these advantages to us while also facilitating a tax abatement with a value of over $10 million.”

Luce said Aerotropolis has been able to accomplish more in the last seven months than in its history of nearly 10 years.

As Aerotropolis beefs up its efforts to attract companies to southeast Michigan, Luce said a mass transit system will be key to securing those projects.

Evans presented a 20-year regional transit proposal this month that would require voters to approve a $5.4 billion tax later this year.

The plan includes commuter rail service connecting Ann Arbor and Detroit. Aerotropolis’ target area near the airport is located between the two cities. There also would be 15 new express regional bus routes connecting major destinations across the four counties. Four of the routes would provide express service to the airport.

Regional transit would allow for a more mobile workforce in southeast Michigan — a draw for companies looking to build new facilities and hire, Luce said.

“That’s going to further enable the workforce of the future that might not be here currently,” Luce said. “More than anything, companies look at is there a workforce there that I can hire to run my operation? Having mass transit allows for the mobility of that workforce.”

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Twitter: @NicquelTerry