DETROIT – Detroit Mayor Mike Duggan announced Tuesday a proposal that would bring a new Amazon distribution center to the former State Fairgrounds site by 2022.
Two development groups, Hillwood Investment Properties and the Sterling Group, are slated to purchase 142 acres at the former State Fairgrounds site from the city of Detroit -- and Amazon is expected to be their first tenant.
“What Detroit needs more than anything right now is jobs and we are deeply appreciative that Hillwood and the Sterling Group have made our city its choice to purchase the former Michigan State Fairgrounds with the potential to bring more than 1,200 good paying jobs,” said Mayor Duggan. “The developers and the new tenant will be working closely with our team at Detroit at Work, which will be helping to provide outstanding candidates who are residents of the city.”
The proposed $400 million, 3.8 million square-foot Amazon distribution center is expected to provide at least 1,200 jobs during its first phase of opening. Duggan says the center will eventually hopefully employ more than 2,000 people in the area.
As part of a contract between the city and the development groups, new employees will be paid a minimum of $15 per hour with benefits. This agreement comes as Detroit faces an unemployment rate exceeding 30 percent as of Tuesday, Duggan said.
“This agreement for the proposed sale of the State Fair Grounds is a tremendous opportunity, not only for District 2 and the City of Detroit, but for the unification of Southeast Michigan,” said Councilman Roy McCalister, whose district includes the Fairgrounds property. “The potential for 1,200 Amazon jobs at this new facility represents an opportunity to diversify our economy while employing residents of our City. To that end, I hope and expect that this new facility will become a major employer, as well as a dynamic training ground for Detroit workers for years to come.”
Duggan said that in addition to the $9 million asking price, the development groups have also agreed to provide a new $7 million indoor transit center on the site under the terms of the proposed deal. The proposed Amazon distribution center will take up approximately half of the 142 acres in the southeast region of the site, while the transit center will be located further north, off of 8 Mile Road.
Duggan said Tuesday that the 8 Mile Road and Woodward Avenue transit hub is the second-largest transit hub for Detroiters -- and the conditions are less than ideal. About 30,000 riders from nine separate bus routes transfer to SMART or DDOT buses at this transit site and wait on the street or in a series of outdoor bus shelters, officials said.
The newly-proposed indoor transit center would include an enclosed waiting area with air conditioning and heat, clean bathrooms, free wifi and a bus operator break room, officials said.
Officials say the proposed transit center would also provide convenient connections to the remainder of the development site, Woodward Avenue and State Fair Avenue.
The city’s proposal for redevelopment leaves acreage available for other development projects not yet identified, in addition to planned green space. Duggan said Tuesday that he would also like to see housing built on the proposed development site.
The Detroit City Council is expected to review a purchase agreement in September after its summer recess, officials said. If the council approves the purchase, construction could begin by the end of October.
Officials say the development groups will pay for any needed demolition and environmental remediation to prepare the land for redevelopment. The project will be privately financed and excludes any tax breaks or incentives, Duggan said.
The city of Detroit previously purchased the 142 acres at the former State Fairgrounds for $7 million in 2018.
Ex-NBA star Earvin “Magic” Johnson’s Magic Plus LLC development company also bought about 16 acres from the land bank in 2018.
The site used to host the Michigan State Fair from 1905 until 2009, and has been largely unused since. It has been most recently used as a COVID-19 testing site amid the coronavirus pandemic.
In addition to the redevelopment proposal, Duggan announced Tuesday that the city is launching a Detroit Entrepreneurship Academy to help prepare Detroiters for potential jobs or for starting their own businesses.
Part of the academy will focus on helping Detroiters prepare to launch their own Amazon delivery service as part of Amazon’s Delivery Service Partners program.
Participating individuals interested in Amazon or their own ideas will gain assistance and training in budgeting, optimizing business models, hiring and managing staff and more, officials said.
“Detroit at Work is excited to expand our training to include micro- and small business readiness,” said Executive Director of Workforce Development & Detroit At Work, Nicole Sherard-Freeman. “The Academy has been on our radar for a while because so many Detroiters have the drive and creativity to be small business owners and have asked for our help. Amazon’s potential presence in Detroit could help Detroit small business community grow. It’s good news for all aspiring business-owners.”
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