Projects approved Wednesday by the Michigan Strategic Fund of the Michigan Economic Development Corp. are expected to generate nearly $3.6 billion of capital investment and support the creation of at least 741 jobs in the state.
“Today’s MSF actions build on the major investments made in Michigan’s automotive and mobility strengths over the past year, indicating our state’s continued leadership in driving future transportation solutions,” says Jeff Mason, CEO of the corporation. “Additionally, these community revitalization projects will drive sustainable and long-term vibrancy to neighborhoods throughout Detroit.”
The fund approved amendments to the Global Retention MEGA tax credit agreement with Detroit’s General Motors Co. that will foster the company’s continued investment in Michigan and ensure the state’s position as a global automotive leader. The amendments will enable the company to have more flexibility to manage its Michigan operations and will signify its commitment to delivering electric vehicles and mobility solutions.
GM has committed to invest at least $3.5 billion in Michigan over the next 10 years, including a significant investment at its Detroit Hamtramck facility, which will be the future home of a newly announced battery electric truck and other electric vehicles. The investment will eventually result in new employment opportunities.
Along with the $3.5 billion investment plan, the fund approved the following:
- A reduction of the maximum credit benefit on the remaining value of the company’s Global Retention MEGA credit term by $325 million for a remaining credit value of $2.27 billion;
- The addition of annual caps for the remaining credit term, which is in effect through 2029;
- An agreement to terminate the company’s MEGA credit at its Brownstown Township facility, reducing the state’s liability by $4.1 million;
- Increasing the average weekly wage from $650 to $1,300 statewide for the remaining credit term;
- Allowing for statewide job retention rather than limiting it to certain locations.
Estimates from the Center for Automotive Research show every job in an automotive assembly plant has a multiplier of eight jobs throughout the supply chain.
Dakkota Integrated Systems in Holt plans to construct and operate a 300,000-square-foot manufacturing facility on a portion of the former Kettering High School and Rose Elementary School sites in Detroit. The facility will supply suspension assemblies and instrument panel assemblies in support of Fiat Chrysler Automobiles’ production of the Jeep Grand Cherokee and Jeep Grand Wagoneer, as well as other future business via multimodal commerce including truck and rail.
The project is expected to generate a total capital investment of up to $45 million in Detroit and create 400 jobs. The company was awarded a $1.5 million Michigan Business Development Program grant and has been approved as a Next Michigan Business within the boundaries of the Detroit Next Michigan Development Corp. Renaissance Zone for a period of 15 years estimated to be worth $3.5 million. Dakkota chose the site over competing sites in Ohio and Canada.
The company also plans to leverage local programs to hire Detroit residents. It offers a tuition reimbursement program and training opportunities for growth within the company.
“Dakkota has made a major commitment to Detroit, bringing its new FCA parts manufacturing plant that will bring more than 400 new jobs to the site of the former Kettering school,” says Detroit Mayor Mike Duggan. “Even better, Dakkota founder Andra Rush has committed to interviewing pre-qualified Detroiters for these jobs first, before considering anyone from outside the city and giving highest priority to Detroiters living in the neighborhoods immediately adjacent to the new plant. I’m optimistic that this development will help attract another supplier to redevelop the rest of the Kettering site and bring even more new jobs to our city.”
The Michigan Department of Transportation has committed $832,939 in grant funding to help address transportation needs. The city of Detroit has matched $268,018 of these dollars to secure the grant funding. Detroit is also providing an industrial property tax abatement and street and utility vacations.
Dakkota was founded in 2001 and supplies assembly and sequencing services for the OEM automotive market.
The Mosaic Eastern Market Redevelopment Project will rehabilitate an existing structure in Detroit’s Eastern Market into a mixed-use food hub. The project will include an accelerator space for food entrepreneurs and food-based businesses, commercial and office space, restaurant space, and a common area with event space. A small ancillary building will be demolished to allow for a surface parking lot. The project is expected to generate a total capital investment of more than $24 million and support an estimated 300 full-time jobs.
The City of Detroit Brownfield Redevelopment Authority received fund approval of local and school tax capture valued at $3.7 million for the alleviation of brownfield conditions at the site. The city also is anticipated to approve a 12-year Obsolete Property Rehabilitation Act tax abatement in support of the project.
The Jefferson Van Dyke 2 community development project includes the demolition of a parking structure, construction of a mixed-use building, and renovation of four existing buildings on two parcels of property located at Jefferson and Van Dyke in Detroit’s West Village neighborhood. The new building will include commercial space and 36 residential units of mixed-income housing, and the rehabilitated buildings will include commercial space, a restaurant, a café, six residential units, and parking. It will also include a green alley, green and blue roof technology, and an art gallery. The project is expected to generate a total capital investment of $22 million and create 39 full-time equivalent jobs.
The fund approved a $3.3-million Michigan Community Revitalization Program performance-based loan in support of the project. The City of Detroit Brownfield Redevelopment Authority also received fund approval of local and school tax capture valued at $3.7 million for the alleviation of brownfield conditions at the site. The city has also approved an Obsolete Property Rehabilitation Act tax abatement with an anticipated value of $833,123. The project has also been awarded a $2.5 million Affordable Housing Leverage Fund loan.
In addition, 3820 West End plans to build a new four-story, mixed-use development along the Grand River corridor in the Woodbridge neighborhood of Detroit. When completed, the Osi Apartments at West End will include retail space and 30 units of mixed income housing. The project is expected to generate a total capital investment of $6.6 million and create two jobs.
The project is the first to be developed in the West End Gallery District, a recent community development plan commissioned by Midtown Detroit Inc.
The fund approved a $1.2-million Michigan Community Revitalization Program performance-based loan in support of the project. The City of Detroit Brownfield Redevelopment Authority also received fund approval of local and school tax capture valued at $226,767 for the alleviation of brownfield conditions at the site. In addition, the city is anticipated to approve a Commercial Rehabilitation Act tax abatement valued at $840,000.
The Michigan Economic Development Corp. is the state’s marketing arm and advocate for business development, job awareness, and community development with the focus on growing Michigan’s economy.