Sakthi Automotive Invests Again in Detroit

FROM: Peter H. Chapman, Executive Vice President, Business Development

When it comes to Detroit, Sakthi Automotive just can’t get enough. Today it broke ground for its third significant investment in the city in the past five years: a standalone, 60,000 sq. ft. facility directly south of its headquarters at 6401 W. Fort Street. This $7 million expansion will add 200 new jobs to its manufacturing and distribution facilities in southwest Detroit to support its expanding business with U.S. and European OEMs.

Sakthi opened its first facility in Detroit in 2014, initially with 75 employees. It expanded in 2015, adding 100 new jobs at its plant on American Way. It then opened a major manufacturing facility and an aluminum foundry in 2016 on the south side of the old Southwestern High School.

Sakthi’s experience demonstrates why companies around the world are looking to tap into Detroit’s key assets – proximity to global customers, access to high technology manufacturing research, and a strong local workforce. Once they come to Detroit, companies want to stay and grow.

At Sakthi, it’s very important to contribute to the communities in which it invests. It has committed to continue to train and hire Detroiters – including returning citizens — through its partnerships with Detroit Employment Solutions Corporation and Michigan’s Community Ventures program. Sakthi has recruited a significant part of its workforce of more than 500 employees through those programs, and 65 percent of those employees live in the city of Detroit.

That’s why DEGC’s work to target and attract business is so important – our economy, the city and its residents all benefit. Advanced manufacturing is one of five key business sectors we are focused on attracting and retaining. I’m confident that as other manufacturers see Sakthi’s success, they will want to come to Detroit too and the momentum will continue.

DEGC Board Names Arthur Jemison as its New President and CEO

FROM: James Vella, DEGC Board Chairman

The Board of Directors, Detroit Economic Growth Corporation, today announced the selection of Arthur Jemison as President and CEO, DEGC. Jemison leaves his position as Director of Housing & Revitalization for the City of Detroit, a role he’s held since September 2014. He is expected to start in his new role Dec. 15, 2017.

“The DEGC Board oversaw a very thorough and deliberate search process that included local and national candidates with proven success in economic revitalization,” said DEGC Board Chairman James Vella. “We are thrilled to have someone of Arthur’s caliber to lead a team that already has been accomplishing great things for our city.”

Before coming to Detroit Jemison served as Deputy Undersecretary and Deputy Director, Department of Housing and Community Development, for the Commonwealth of Massachusetts. He has held a variety of both public- and private- sector positions, many related to city planning and urban development. This includes his role in the Office of Deputy Mayor for Planning & Development, District of Columbia, where he worked on Major League Baseball site selection, CityCenterDC, and the Marriott Marquis Washington, D.C.

Detroit Mayor Mike Duggan said, “Arthur has been critical to our efforts to make sure the city’s revitalization reaches all of our neighborhoods.  He is an outstanding choice to lead the DEGC as it continues to a larger role in attracting equitable growth and development to Detroit.”

Since coming to Detroit, Jemison has made significant contributions to the city’s housing transformation, including:

• Three-year collaboration with City Council on recently passed affordable housing ordinance to require developers who receive discounted city land or city funding to allocate at least 20% of the units in that development as affordable housing units.

• Worked with development community to complete over 1,400 units including 400 affordable units since 2015 at approximately $200m investment.

• Secured an $8.9 million grant from the U.S. Department HUD to drive planning, housing and public improvements for targeted neighborhoods.  Notably, this grant funding represented dollars allocated to other cities that went unspent.  Because of Detroit’s track record effectively utilizing HUD dollars under Jemison’s leadership, the funding was re-allocated to the city.

“I’m honored to lead the DEGC at such a critical moment,” said Jemison. “Our city is on a trajectory of prosperity and economic leadership fueled by business development. DEGC has earned a reputation as a trusted partner, business incubator, revitalization specialist and resource network. I will continue our focus on creating opportunities for local business owners, entrepreneurs and residents that allows every Detroiter to be part of the city’s success.”

Jemison is a graduate of the Massachusetts Institute of Technology and the University of Massachusetts. He succeeds Glen W. Long, Jr., DEGC Chief Financial Officer, who has served as interim CEO.

“We are thankful to Glen and the entire DEGC team for their tremendous achievements so far this year, including their work on Little Caesars Arena, Flex-N-Gate, and a variety of programs that support local businesses,” said Vella. “The addition of Jemison will accelerate our efforts to improve the quality of life for all Detroiters through economic development.”

Neighborhood Restaurants Opening At a Fast Pace

FROM: Michael Rafferty, Vice President, Small Business Services

There’s a restaurant resurgence underway in Detroit neighborhoods … by Detroiters. Across our city Detroiters are opening local restaurants and eateries with unique themes that celebrate cultures and support the community.

Just last week, PizzaPlex opened on Vernor Highway in southwest Detroit to “create comfortable spaces and serve good food for a more sustainable city.” Two weeks ago, Brix Wine & Charcuterie Boutique opened its doors in a bank it renovated in the historic West Village district. Coming next spring, Simply Breakfast will open on West McNichols. Owner Ken Brown plans to employ returning citizens and provide them with the time, tools and training to make a successful transition back into the community.

And the list goes on! There’s Detroit Vegan Soul, with locations in West Village and Grandmont/Rosedale; Social Sushi pop-ups all over the city; and Narrow Way Café, which opened in August on Livernois, Detroit’s Avenue of Fashion.

It seems like every month there are more places to mix, mingle and eat in Detroit’s neighborhoods. That’s great news because restaurants and cafes create foot traffic and can be the seeds for walkable neighborhoods and small business development around them. They are destinations and gathering places that add to the vibrancy of our city.

DEGC is proud to support both new and existing small businesses through our Motor City Match and Motor City Re-Store programs, which combined award $1 million in matching grants each quarter. In fact, all the restaurants I mentioned have won a Motor City Match grant. Motor City Match is now starting its third year of supporting city entrepreneurs while Motor City Re-Store was launched this June and will announce its first grant winners later this fall.

We know there are many more eateries in the pipeline, since Motor City Match awarded cash grants to six specialty cafes or restaurants, a mushroom farm and two microbreweries last month. So, as you can see, Detroit’s food scene is “boiling” as Detroiters make the Motor City a culinary destination for our region. We’re happy to be a part of this resurgence.

Little Caesars Arena: A Collaborative Effort

FROM: Charlotte Fisher, Director, Marketing and Communications

Nearly five years and countless DEGC staff hours culminated in the ribbon-cutting at the new Little Caesars Arena in Detroit Sept. 5, 2017. Crowds gathered under sunny skies in Chevrolet Plaza at the corner of Woodward Ave. and Henry St. to witness the monumental event, which included remarks from a variety of city and state dignitaries.

Michigan Gov. Rick Snyder called the arena and surrounding area the glue connecting midtown and downtown. Detroit Mayor Mike Duggan said the economic benefit of the project is deeply woven in the urban fabric of the city. Ilitch Holdings President CEO Chris Ilitch gave special kudos to DEGC for helping bring the project to life.

The new 20,000 seat arena is the centerpiece of a 50-block area of the city dubbed The District Detroit that will include development of office space, retail, housing and hotels.

DEGC team at groundbreaking event
The DEGC team participates in the 2015 arena groundbreaking event.

DEGC CFO & Interim President Glen Long credits the collaborative efforts of DEGC staff working with the DDA board, city government, Ilitch Holdings, and numerous private and public entities to maximize the project’s benefit to Detroit.

“What started as a hockey arena is now a world-class multi-purpose facility that unites Detroit’s four professional sports teams within a four-block area of the city core,” said Long.

“All four major sports teams haven’t been together in Detroit since 1975, and the arena opening makes Detroit the only city in America that has all of its teams downtown. The arena will now host events 225 days of the year, bringing additional economic opportunity to the city and its residents in terms of jobs and new business creation.

“The DEGC, acting as the city’s non-profit economic driver, was instrumental in every facet of the area’s development, including bond sales, construction management and innovative incentive development. The DEGC has been Detroit’s catalyst for economic growth and opportunity for nearly 40 years, and our participation in the development of The District Detroit will maximize financial benefits for all Detroiters,” said Long.

DEGC facilitates large projects like Little Caesars Arena that bring jobs and revenue to the city. Other recent investment brought to Detroit by DEGC include a $95 million manufacturing facility from automotive supplier Flex-N-Gate in the I-94 Industrial Park on the city’s east side and a $57 million Sakthi Automotive investment at its campus on the city’s west side.

In addition to helping bring the Detroit Pistons back to the city, DEGC is also working with developers on the development of the team’s new corporate headquarters in Detroit.

DEGC’s D2D Program was instrumental in ensuring Detroit businesses were a major part of the arena’s construction. Ilitch Holdings reported the following statistics regarding state and city business utilization/employment:
• 94% of construction contracts for LCA were awarded to Michigan businesses.
• 61% were awarded to companies in Detroit, totaling nearly $475 million.
• LCA represented the most hours worked on a single project by Detroiters in over 40 years.
• 836 new skilled-trades apprentices were trained during the arena construction.
• 2,000 people will be hired in post-construction jobs.
• 61% of these jobs will be filled by Detroiters.

One of those apprentices trained was Detroit resident John Perkins, now a project engineer at Barton Malow.

“You change a person’s life when you give them an opportunity to work,” Perkins said. “This project opened doors that I didn’t know existed. I’m proud to have helped build this arena alongside other hard-working Detroiters. ”

DEGC Contributions to Little Caesars Arena Development

• Led negotiation of Memorandum of Understanding approved by the DDA in June, 2013
• Led negotiation of Concession Management Agreement originally approved by DDA in December, 2013
• Managed process to amend DDA TIF plan in 2013 to allow Catalyst Development taxes to be captured to finance arena construction and to support other development in the district – approved by DDA, Detroit City Council and the Michigan Strategic Fund (MSF)
• Managed process to sell $250 million in bonds to finance the public portion of construction – approved by DDA and MSF in December, 2014.
• Monitored subcontract bidding process on behalf of the DDA throughout construction – 2015 to present
• Participated in negotiations for Memorandum of Understanding that returned the Pistons to Detroit – approved by the DDA in November, 2016
• Managed approvals of $233 million in private ancillary development in the District Detroit to date
• Managed DDA and City Council approvals of amendments to DDA TIF plan in June, 2017 to allow Catalyst Development taxes to finance arena construction changes required for the Pistons
• Managed subsequent sale of $36 million in bonds to finance the construction required by the Pistons
• Managed approvals of Brownfield tax increment financing, and real and personal tax abatements in June, 2017 to accommodate development of the new Pistons corporate headquarters and practice facility in New Center.

DEGC Programs Actively Connect Detroit Business with Opportunity

FROM: Michael Rafferty, Vice President, Small Business Services

Three small business programs are actively connecting Detroiters with opportunities to renew and expand their businesses.

The D2D program is an ongoing pipeline to match developers with local contractors specializing in renovation, rehabilitation and redevelopment projects.

Recently, Joe Tate and Keyra Cokley hosted a D2D PRO Session for Detroit contractors to showcase opportunities with the new Pistons Performance Center and Henry Ford Health System Center for Athletic Medicine. The $70 million construction project will kick off this fall for an anticipated opening in mid-2019. The 167,000-sq. ft. facility will house the headquarters for Palace Sports & Entertainment as well as basketball courts, advanced training rooms and a parking structure.

More than 60 representatives of Detroit’s business community came to learn more about the project and the opportunities available.

“The D2D PRO Session on the Detroit Pistons Performance Center and Henry Ford Health System Center for Athletic Medicine provided not only several bidding opportunities within the city of Detroit, but created an environment that fosters other collaborative project opportunities with my peers in the construction industry,” said Kimle Nailer, president, Nail-Rite Construction Company, Inc.

The next PRO Session is September 8, 2017, and will focus on 7 LIV, a mixed-use development of retail, residential and parking on the corner of 7 Mile Rd. and Livernois. The estimated investment is $8 million.

Motor City Match
Motor City Match (MCM) connects entrepreneurs who operate new or expanding businesses in Detroit with real estate opportunities and a variety of other resources. Since launched by the Mayor in early 2015, more than $3.9 million in grants have been awarded to 87 winners, and infused a total of $24 million in Detroit’s neighborhood commercial corridors. Grants are awarded on a quarterly basis throughout the year.

On August 14, Motor City Match announced 13 matching grant awards totaling $500,000 to a variety of businesses in neighborhoods across the city of Detroit, including Rosedale Park, Islandview, Bagley, Southwest, We Care Community, Boston Edison and Jefferson. MCM will provide additionally selected entrepreneurs assistance with business plan writing, space locating and renovation planning.

The next application window for building and business owners to apply for grants and other assistance opens Friday, September 1, 2017, and closes October 2, 2017.

Motor City Re-Store
The newest program, Motor City Re-Store, helps established neighborhood businesses boost their curb appeal. Every three months, selected businesses will receive matching grants to improve the exterior of their business and enhance Detroit’s walkability and attractiveness.

Its next application window also opens September 1 and closes October 1.

DEGC is proud to offer a network of support for every kind of small business in every phase of growth. Working in partnership with Mayor Duggan’s office and private, philanthropic, and non-profit organizations, our goal is to help businesses locate and thrive in Detroit.