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Former Detroit-owned prison property in Plymouth Township eyed for large new warehouse

The city of Detroit plans to sell off its owned portion of the former Detroit House of Corrections site in Plymouth Township for $5.5 million.

If all moves forward under the current plan, the 190.5-acre vacant site would be developed into a 1.2 million-square-foot build-to-suit building by an out-of-state developer that does work for FedEx Corp., Inc. and others.

The Detroit City Council is considering the sale to Kansas City, Mo.-based developer Jones Development, which plans what are only described as “industrial uses” on property at the southeast corner of 5 Mile and Napier roads, according to a council briefing memo.

But Kurt Heise, Plymouth Township supervisor, said Jones Development has briefed township officials on a large distribution facility on the site.

“These guys specialize in that kind of large-scale logistics … We don’t think it’s a speculative project,” Heise said.

An email was sent to Nicholas Jones, the company’s executive vice president of development, seeking comment on Tuesday and a voicemail was left on Wednesday.

Elizabeth Kmetz-Armitage, deputy group executive for planning, housing and development under Mayor Mike Duggan, said the city’s brokerage firm, Summit Commercial, briefed her on a serious offer from Jones Development in July, about five years since the city began marketing the property for sale.

“Since 2016, we’ve had, I think, four significant, credible offers,” Kmetz-Armitage said. “For the most part, those have not gone through because of the zoning. With a couple of cases, folks were approaching us because they thought they could get Plymouth Township to rezone the land to allow for single-family (residential uses) and they were not successful in that endeavor, so the deal fell apart.”

The Jones Development website says it has Southeast Michigan projects in Auburn Hills and Pontiac, as well as statewide in Battle Creek, Kalamazoo, Portage and Portland Township.

A resolution authorizing the sale was sent to the Planning and Economic Development standing committee on Tuesday. That committee typically meets on Thursdays although the Nov. 11 meeting has been postponed.

The briefing document says a purchase agreement between the city and Jones Development requires closing within 30 days after a 180-day due diligence period.

“We’re very pleased to have a deal that looks viable and is moving in the right direction,” Kmetz-Armitage said. “This has been something that we’ve been looking to sell for some time, so we’re pleased that we’re here.”

This proposed sale comes three years after the council approved a sale of the property to Prime Land Holdings LLC, which is registered in the Southfield headquarters of Ciena Healthcare, for $6 million. However, that deal never closed and Prime Land Holdings terminated the purchase agreement.

The Detroit Building Authority, which manages the property, would receive $330,000 from the sale proceeds while Summit Commercial LLC, would receive $275,000, according to the resolution approving the sale.

The 190.5 acres is part of the broader former Detroit House of Corrections site, sometimes abbreviated as DeHoCo, which sits in Plymouth and Northville townships and is now marketed as the Michigan International Technology Center. That area consists of 800 acres across 15 different chunks of land both north and south of 5 Mile Road spanning between Napier Road to the west to just west of Beck Road to the east.

Detroit’s owned site used to be the DeHoCo farm, Heise said.

“Regardless of what side of Five Mile, at one time this was all owned either by the city of Detroit or the state of Michigan,” Heise said. “That goes back to the 1920s because in the 1920s and 1930s, this was tundra. This was Alaska. This was No Man’s Land, so land was cheap and Detroit and Wayne County put their undesirable people way out here in No Man’s Land.”

The Detroit News reported in early 2017 that DeHoCo replaced a former city corrections facility within its borders by buying approximately 1,000 acres in the two townships at about $30 per acre and building a $2.5 million prison in 1931. Over time, the prison closed and the city sold off much of the property for millions.

Some of the properties that were once part of DeHoCo have been sold or are under control of other developers such as Southfield-based Redico LLC, which controls the Michigan Land Bank Fast Track Authority-owned site where the prison itself was located, and Novi-based Hillside Investments.

Northville Township owns much of the former DeHoCo site that sits on the north side of Five Mile Road, minus a couple parcels, Heise said.

He also said another portion of the property in Plymouth has been sold to Raleigh, N.C.-based Brookwood Capital Partners, which plans a 300,000-square-foot warehouse on the site.


Posted By: Crain’s Detroit Business on November 10, 2021.  For more information, please click here to read the source article.

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