Former GM plant is sold

January 14, 2011
| By Pete Daly |
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What the city of Wyoming describes as a “unique partnership” between it and a southeast Michigan property development company has been launched to find an “advanced manufacturing” company to occupy the site of the former General Motors stamping plant on 36th Street.

City officials and executives from Lormax Stern Development Co. of West Bloomfield announced last week that Lormax had bought the 92-acre site from Motors Liquidation Co. in Detroit, for an undisclosed amount. MLC is the renamed remnant of the former General Motors, formed in the GM bankruptcy in 2009 to sell off assets not needed by the new GM. That includes about 15 mothballed plants around the country, similar to the Wyoming plant.

The partnership’s plans call for complete demolition of the plant and clearing of the site within 18 months and development of it for “one or two large sites for advanced manufacturing facilities over the next 48 months. Additionally, the site would be ideal for an industrial park, with a large anchor and its multiple suppliers,” states the city’s announcement.

Deputy City Manager Barbara VanDuren said Wyoming and Lormax will form a legal partnership in the redevelopment project, with the city paying Lormax a token amount for its help — $1.

Wyoming city officials have been adamant that they want to see the GM site used again for manufacturing, providing full-time jobs.

“We have an excellent skilled workforce in Wyoming, and we remain committed to attracting and retaining high-paying industrial jobs,” said Wyoming mayor Jack Poll.

More than 1,500 people worked at the GM plant just before it ceased production in May 2009. Built in 1936, it was long the city’s largest taxpayer, generating about $1 million a year for the city treasury, according to City Manager Curtis Holt. Generations of workers from the region produced stamped sheet metal auto parts.

The Right Place Inc. economic development agency in Grand Rapids is also working with the public-private partnership to market the re-developed property to a major “advanced manufacturer.”

The sprawling site is bounded by U.S. 131 on the west, Buchanan Street SW on the east, 36th Street SW on the north and 40th Street SW.

“This is one of the best sites” among the former GM plants available in the U.S., “and a critical piece of industrial property in West Michigan,” said Birgit Klohs, president and CEO of The Right Place.

“Since the day the unfortunate announcement came (about the GM plant closing), the city and The Right Place have worked hand in hand to discuss what should happen to the site,” said Klohs.

“We are glad that it was understood by all parties — particularly the purchaser — that the building has to come down, so that a very sophisticated manufacturing site” can be developed there, she said. Klohs and other experts in industrial property have noted the existing rail spur on the property and its close proximity to major traffic arteries, plus existing utilities, enhance its value for manufacturing.

Klohs described advanced manufacturing as companies such as Autocam, Lacks and Cascade Engineering, which use “very sophisticated products and processes, for anything from alternative energy (equipment) to automobiles.”

“Most manufacturers today — from mid-size to the big ones — have become advanced manufacturers,” she said.

Advanced manufacturing “also requires a skilled labor force. It’s not the simple push-a-button kind of thing” American manufacturing work once was, she said, because manufacturing machinery today is generally “computer-driven, often robotic.”

“We are going to put together, in collaboration with the developers and the city, a marketing strategy” focused on “the kind of companies that we want to approach, who might be interested — both in the U.S. and overseas,” said Klohs.

Lormax will hold exclusive rights to redevelop the property, which must conform to the city’s current zoning requirements.  The city of Wyoming has committed to finance a road on the site and related infrastructure needed to support advanced manufacturing.

Lormax has mainly been a developer of retail projects, many in southeast Michigan, but is Centerpointe Mall in Grand Rapids, and the Lormax website lists North Kent Mall as another property in which it is involved.

Chris Brochert, a Lormax partner, said the former GM site it now owns is “not going to be an industrial park with multiple small users. The only way that could take place is if we had one anchor (factory), that would have smaller suppliers … that would need to be in close proximity. We’re really looking to bring a major facility on to this site.”

He acknowledged that Lormax has “always been in retail” but “we are currently looking to diversify our asset base.”

Brochert said that “it takes the same know-how to build a million square foot industrial facility as it does to build a million square foot shopping center. In fact, it’s easier. Everything comes down to moving dirt, putting in footings and building a structure. The only difference is, instead of having 50 tenants, you have one.”

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