Former GM Plant Offers Variety Of Spaces

April 28, 2008
| By Pete Daly |
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A 2 million-square-foot stamping plant that once housed hundreds of heavy machines has been redeveloped into two separate buildings with numerous interior spaces for a variety of uses — even office space.

The office area that will be built this spring by Tourney Consulting Group, one of the tenants of Midlink Business Park, amounts to a “box inside a box inside a box," according to David Smith, president of Midlink.

The huge GM stamping plant, east of the city of Kalamazoo, closed in 1999, resulting in the loss of more than 1,100 jobs. When the closing was announced in 1998, GM said it hoped to sell the property and industrial equipment to another stamping operation that could use the extensive space with machinery already in place. However, said Smith, "There weren't any two-million-square-feet users in the market." Instead, the 340-acre property was acquired by Hackman Capital Partners, based in Los Angeles.

Smith said Hackman was able to strike a deal with GM because Hackman has had prior experience reselling industrial equipment, and also had sufficient capital to acquire both the real estate and the personal property at the same time in a "bulk transaction."

"We understand the real estate business and we understand the equipment business," said Smith. "We kind of went to the front of the line in the mind of GM when they were trying to dispose of that asset."

"We like to say, ‘They left on Friday and didn't come back on Monday,’" quipped Smith.

Smith said Hackman paid $26 million for the real estate and personal property, and then spent "upwards of $30 million” on renovation of the 340 acres and the former building.

According to Smith, a 300,000-square-foot open strip was made lengthwise down the middle of the stamping plant, creating two 800,000-square-foot buildings: Midlink East and Midlink West. The acreage surrounding the two buildings was also developed for mixed-use, and the state granted the site tax-free Renaissance Zone status to encourage companies to locate there.

Smith credits the Charter Township of Comstock board, Southwest Michigan First and the Michigan Economic Development Corp. with enabling Hackman Capital to create "a pro-business environment here that allows us to be responsive to the market and our tenants."

One of those tenants is Tourney Consulting Group, which moved into Midlink West in August 2006. Tourney is a national consulting engineering company that specializes in concrete durability. It inspects and tests concrete structures such as parking garages, bridges and marine structures, and provides the owners or prospective buyers with detailed plans and cost estimates for repair and/or improvements.

Tourney Consulting Group has been occupying temporary quarters in Midlink West but now is about to begin construction of its new, permanent quarters in another area within the same building. Its new 20,000-square-foot home will include testing labs and research facilities, plus office space for the company’s nine employees, according to Larry Wachowski, the manager of Tourney’s laboratories.

The office area within the 20,000 square feet will be a 6,000-square-foot "box" along the exterior wall with windows facing Sprinkle Road.

"There are infrastructure challenges but, ultimately, we laid it out in a way that would be as cost-effective as possible," said Smith.

Stamping plants require high ceilings: In Midlink West, the clear height is 20 feet above the floor, and in Midlink East, where the largest machines were used, the clear height varies from 38 to 42 feet.

The buildings are on thick concrete slabs, so Midlink had to install sewer lines under the floor, and also erected floor-to-ceiling walls on the two interior sides of the Tourney space. The consulting group is building its labs and office spaces itself. The office area also requires walls and a ceiling 10 feet above the floor — "like a normal office area," according to Wachowski.

Just over 70 percent of the combined footage of both buildings is occupied today, mostly by small manufacturers and other companies needing warehouse space. The Tourney office area is the first new office space created in the revamped buildings, although the original front of the building still contains a 38,000-square-foot shell that formerly housed the GM offices.

Plans for further development at Midlink Business Park include a 38-acre office campus and a 43-acre retail area.

Smith said Midlink West would be ideal space for a company needing an open office environment such as a large call center, which would require a lot of existing infrastructure in terms of power and communications. It would also be ideal for a company needing showrooms.

"While we haven't landed one of those tenants, we have spent significant effort and gotten close on a few," said Smith.

Warehousing, distribution and advanced manufacturing are the uses most suited to the Midlink buildings, but the size does offer flexibility for growing companies and the reconfiguration of the original building has yielded additional parking space.

"We're thrilled that business is healthy and that Midlink is so supportive of our growth," said Paul Tourney, president of Tourney Consulting. "Their tremendous size and enormous flexibility enable us to expand our facilities without having to move. That will remain a huge advantage for us as we continue to grow and create jobs in the community."

Tourney Consulting Group is a new company that has clients throughout the U.S. and is growing rapidly, with the potential of doubling its employment within the next year or two, according to Wachowski. That would probably mean a requirement for still more office space since the technicians also require computerized workstations.

Midlink West is also home to other tenants, including Kenco Logistics, Wal-Mart, Erickson Flooring, ICS and ESCO-Midwest. Midlink Business Park is represented by commercial real estate firm Signature Associates.

Hackman Capital Partners specializes in the acquisition, management, development and adaptive re-use of industrial real estate. It now owns more than 16 million square feet of industrial, office and retail properties, plus more than 700 acres of land for development. Founded in 1987, it focuses on leased or vacant industrial properties, undervalued or distressed real estate, and financial restructurings or similar real estate opportunities. Headquartered in Los Angeles, Hackman Capital also has offices in Irvine, Calif.; Chicago; Columbus, Ohio; and Kalamazoo. CQX

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