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Michigan Strategic Fund Incentives Sparks $362 Million In Capital Investment Throughout The Great Lakes State

Area Development Online News Desk (02/26/2014)
The Michigan Strategic Fund approved economic development and community revitalization projects that are expected to generate $362 million in capital investment and create a total of 1,444 jobs throughout the Great Lakes State.

“These projects cover a broad range of industries and technologies and assure very strong economic opportunities for Michigan businesses and citizens,” said Governor Rick Snyder. “These new investments in our state will strengthen Michigan’s role in advanced science, improve our communities, and fuel more and better jobs for our talented workforce.”

In a major development project, a proposed 220,160-square-foot Facility for Rare Isotope Beams, which will be constructed Michigan State University campus, received Michigan Strategic Fund approval for issuance of up to $100 million in private activity bonds. The project involves more than $600 million in direct investment, mainly from the federal government. The proposed facility will consist of a newly constructed $165 million building to adjoin the existing National Superconducting Cyclotron Laboratory.

MSU estimates that in the next 10 years, approximately 400 new full-time jobs will be created. When construction of the facility begins, an estimated 5,000 one-year construction jobs will be created.

Additional state business development incentives include grant awards to;

Eberspaecher North America, an automotive supplier specializing in automotive exhaust systems, part of Germany-based Eberspaecher Group, plans to expand its manufacturing capacity in Brighton, Michigan, to over 300,000 square feet. When combined with other investments in Michigan, the project will generate a total capital investment of $122 million and create 545 new jobs, resulting in a $4.5 million Michigan Business Development Program performance-based grant.

In addition, the City of Brighton is considering support of the project in the form of a property tax abatement. The Michigan Department of Transportation is also considering support of the project in the form of a Transportation Economic Development Fund grant.

Kalitta Air, LLC, a Federal Aviation Administration certified provider of aircraft maintenance, repair and overhaul services, plans to construct a new 80,000 square foot airplane hangar in Oscoda Charter Township. This hangar will be built in addition to Kalitta Air’s current operations at the Wurtsmith Airport. The project involves a total capital investment of up to $9.7 million and the creation of 200 jobs, resulting in a $2 million Michigan Business Development Program performance-based grant. In addition, Oscoda Charter Township has offered tax increment financing at an estimated value of $2.3 million over 29 years.

State community revitalization incentive grants were issued to;

Ashley Owner, part of Princeton Domino Investments and Lamont Street Partners, which plans to renovate the vacant, historic Milner Hotel in Detroit. The renovated building will include 61 apartments, 5,200 square feet of commercial office space and two retail units.

The project is anticipated to generate $8.2 million total capital investment and create 25 full-time jobs. As a result, the project is receiving a $1 million Michigan Community Revitalization Program performance-based grant. The City of Detroit Brownfield Redevelopment Authority also received approval for state school tax capture valued at $482,075.

Midland DTH LLC, a single-purpose entity organized by SSP Associates, Inc., is proposing a mixed-use, five story redevelopment in Midland, Michigan. The new 65,000 square-foot building will include extended-stay hotel suites, apartments, a restaurant, office space and an underground parking garage.

The project is anticipated to generate $23 million in total capital investment and create 46 full-time jobs, resulting in a $4.8 million Michigan Community Revitalization Program performance-based loan. The City of Midland also received approval of local and school tax capture valued at $4.65 million.

Strathmore Apartments Limited Dividend Housing Association, in coordination with McCormack Baron Salazar and Midtown Detroit, plans to historically renovate the former Strathmore Hotel in Detroit. The project will convert the vacant, blighted eight-story building into 129 apartments with 2,000 square feet of retail space on the first floor. The project is expected to generate $28.4 million in total capital investment and create three jobs. As a result, the project will receive $3.5 million in Michigan Community Revitalization Program performance-based equity contribution.

State job creation tax credits were awarded to;

AVL Powertrain Engineering, an Austria-based powertrain consulting company, which is considering an expansion project with the potential for up to 100 new jobs at its Plymouth Township and Ann Arbor locations. As a result of this growth, MSF approved an increase in the total new qualified jobs by 100 for the years 2015 through 2017.

McLaren Performance Technologies, a division of Linamar Corporation, plans to consolidate its sales office in Southfield and engineering center in Livonia to create a Sales and Engineering Center on the existing property in Livonia. The consolidation will result in the creation of 75 new jobs and create a technology and sales center to support Linamar and McLaren customers. As a result of this growth, MSF approved an increase in the maximum allowance for new qualified jobs on McLaren’s MEGA credit by 75 from 34 to 109 for the years 2015 through 2019.

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