Last night the Neighborhood Advisory Council formed as part of the community benefits process for the Future of Health development approved a benefits package. We now have the details of this agreement and what developers are planning to spend their public subsidies on. On the already-built side of things, we have demolitions, apartment conversions and some good news for first-time home buyers. Here is all the development news in Detroit you need to get through the week.
Hive alive
Two blighted buildings in Eastern Market have been demolished, clearing the way for the mixed-use Hive development (paywalled). Develop Detroit, an affordable housing developer, has owned the buildings on the corner of Russell Street and Gratiot Avenue since 2016 and 2017 and plans to build 200 affordable apartments, retail and parking at the site. The organization beat its most recent demolition deadline from the city, but overall the project is behind schedule. It was set to be completed by 2020, but financing has been difficult and construction hasn’t started. Both the city and a nearby property owner sued Develop Detroit over the condition of the properties. The developer agreed to demolish the buildings by July in a settlement with the city. The other lawsuit is still ongoing. Both the developer and the city say they are confident the project can get off the ground. (Crain’s Detroit Business, Outlier Media/BridgeDetroit)
New Center’s 10-figure future
Detroit Free Press reporter J.C. Reindl did a great job breaking down emerging details about how developers of the $3 billion Future of Health project will spend the tax credits they are asking lawmakers to approve. They want $287 million in tax breaks and incentives over 35 years. In exchange, the project expects to create 662 apartments, 20% of which will be affordable, and 753 permanent jobs. Most of the New Center project’s cost ($2.2 billion) will be spent on the Henry Ford Hospital expansion. Nonprofit Henry Ford Health doesn’t pay property taxes and therefore won’t receive any tax credits. The bulk of those will go to housing being developed by Tom Gores, owner of the Detroit Pistons. (Freep)
Community benefits
The Future of Health Neighborhood Advisory Council (NAC) last night approved a community benefits package in a 6-2 vote. The city’s Community Benefits Ordinance required Henry Ford Health, Tom Gores and Michigan State University to negotiate benefits with the NAC. The final package included included promises to: accept section 8 vouchers, keep 10% of affordable housing available for tenants earning no more than 30% of the Area Median Income, donate $2 million to a home repair fund for homeowners in the impact area and $500,000 in rent help, provide 50 full-tuition scholarships to Michigan State over 10 years for students at U Prep and Northwestern High Schools, make streetscape improvements, give microgrants to small businesses, make significant improvements to the Williams Recreational Center and more. The NAC will now sign a letter of support for the project and the entire development proposal including the benefits package will go to City Council for approval.
Goodbye to the down payment blues
The first round of Detroit’s Down Payment Assistance Program officially closed last week. The city considers the program a resounding success, helping more than 300 first-time Detroit homebuyers by giving them an average of $24,400 to make a down payment. Many Detroiters have enough income to pay back a mortgage, but even they can struggle to get one. If there is a low appraisal for a home, banks won’t approve enough of a loan to cover the price, leaving Detroiters to cover the cost with a high down payment. The program was funded with American Rescue Plan Act dollars and will take applications for a second round in early 2024. The city said people in the program bought homes with an average price of $116,000 and will pay an average monthly mortgage payment of $912. Program participants’ average household income was $47,810. (City of Detroit, Outlier, WDET)
Development news quick-hitters
The Hammer and Nail building in Midtown is being converted from apartments into a hotel for longer-term stays (paywalled). (Crain’s)
Mayor Mike Duggan has a plan for the city’s trash and recycling to be picked up more often, including construction debris. (BridgeDetroit)
Detroit’s director of urban agriculture is hosting a public conversation about solar farms in the city tomorrow night. (Detroit Documenters)
Correction: This story was updated with the correct spelling of Tom Gores.
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