DETROIT – The Detroit City Council on Tuesday approved the sale of a portion of the former Michigan State Fairgrounds that will be developed into an Amazon distribution center, transit center and more.
The sale comes two months after Detroit Mayor Mike Duggan announced a proposal to sell 142 acres of the former fairgrounds site to two development groups, Hillwood Investment Properties and Sterling Group. Amazon was named as the anticipated first tenant of the development site, with a $400 million distribution center slated to stretch 3.8 million square feet across the area.
Officials said in August that the Amazon distribution center would initially provide at least 1,200 jobs, with hopes of eventually employing more than 2,000 people in the area. Mayor Duggan reinforced that sentiment Tuesday, saying the development project will, in fact, provide the 1,200 jobs in addition to other entrepreneurship opportunities -- though those specific opportunities were not disclosed.
Officials have not yet announced how much the land was purchased for, but the city was asking for $9 million for the 142 acres in its initial proposal. Officials said in August that Hillwood Investment Properties and Sterling Group agreed to also provide a $7 million indoor transit center on the site under the terms of the proposed deal. Duggan confirmed Tuesday that the development project will include a new transit center.
“With Council approval now in place, construction is expected to begin in the coming weeks," Mayor Duggan said in a statement Tuesday. "Attracting large employment centers like this is a major part of our strategy to lift more Detroit families out of poverty and rebuild our city’s middle class.”
All details regarding the sale have not yet been publicly shared. City Council President Brenda Jones released a statement Tuesday saying she did not vote in favor of the deal because there was “no guarantee for permanent jobs with Amazon for Detroit residents” included in the agreement after construction is completed.
“This deal ... sets no goals or metrics for outreach or a partnership with Detroit Employment Solutions Corporation to ensure the 1,200 permanent jobs are filed by Detroiters,” Jones' statement reads. “These non-skilled labor jobs pay $15 per hour with benefits. These are jobs that can easily be filled by Detroit residents who are ready to work and bring value to Amazon, while providing a meaningful quality of life to their families and contribute to the city’s tax base. These are the type of jobs many Detroiters need.”
Jones did, however, argue that some aspects of Tuesday’s agreement are positive for the city and its workforce. According to the city council president, the sale of the untaxed land will generate $42 million in tax revenue over the next 10 years. Amazon will also hire 51% of Detroit laborers during construction and 30% Detroit construction contractors, Jones said.
Her issue with the agreement is specific to hiring terms after the construction is completed. Jones is calling on Amazon to ensure that at least 51% of post-construction employment opportunities are offered to Detroit residents only.
Jones and one other city council member reportedly voted against the agreement Tuesday, with six city council members voting in favor.
Officials previously said that, should the sale be approved, the distribution center is expected to be operational by 2022.