Former GM Warren plant site redevelopment advances with tax incentives

The Michigan Strategic Fund board on Tuesday awarded $7.2 million in brownfield tax captures for the redevelopment of the former General Motors Transmission Plant site.

The owner, Missouri-based NorthPoint Development, sought incentives to offset demolition and environmental remediation costs at the 117-acre site at 23500 Mound. The company has planned a $180 million investment to create 1.4 million square feet of new industrial space across three buildings, according to the Michigan Economic Growth Corporation. 

The incentives would help fill a financing gap due to the additional cost of addressing residual soil and groundwater contamination, demolition and infrastructure improvements, the MEDC said.

"Due to these additional costs, the developer is unable to underwrite a return that is enough to attract investors to the project without financial assistance," MEDC staff wrote in a briefing memo. "Available industrial space in the area is in high demand and this project is expected to help meet that demand from manufacturing and light industrial clients."

The developer has also received local support for the project, including local brownfield tax increment financing valued at $10.8 million and a 12-year industrial facilities property tax abatement valued at $12.6 million, according to the MEDC.

The project is also seeking a $10.6 million in tax increment financing from the Michigan Department of Environment, Great Lakes and Energy, officials said.

In a project summary submitted to the City of Warren, NorthPoint Development, under its affiliate name, NP Mound Road Industrial LLC, said it plans to house multiple tenants on the site and make improvements to parking, green space and storm water management. Jobs at the site will pay at least $15 per hour, according to the summary.

In January, the company said it was in its 10-month demolition and remediation phase. The project is expected to take 36 months to complete.

The former plant opened in 1941 as a Navy Ordnance facility operated by the Hudson Motor Car Company. GM ended production at the plant in summer 2019 and closed it that fall following negotiations with the United Auto Workers. GM used the facility in 2020 to manufacture face masks for its COVID-19 pandemic outreach.

The strategic fund board previously supported incentives for other Northpoint Development's projects: redevelopment of the former Cadillac Stamping Plant on the east side of Detroit and the former Eastland Center shopping mall in Harper Woods.

The former stamping plant site, now called M3 Commerce Center, will be home to Lear Corp. as it makes seats for GM’s Factory Zero Detroit-Hamtramck Assembly Center. The Eastland Center site will become an industrial complex with three new commercial light industrial buildings scheduled for completion in early 2023.

cwilliams@detroitnews.com

Twitter: @CWilliams_DN