Mayor, DEGC announce $14.5 million in grants to move five key neighborhood developments forward

Mayor Mike Duggan | Mayor Mike Duggan Official Website

By NW Wayne News Report

Jan 15, 2024

The Detroit Economic Growth Corporation (DEGC) has been awarded $14.5 million by the Michigan Economic Development Corporation (MEDC) through the Revitalization and Placemaking (RAP) 2.0 program. The grant will provide crucial gap financing to support five major mixed-use development projects in downtown Detroit and key neighborhood commercial corridors. Today, the DEGC hosted a press conference at the Jefferson Intermediate School, one of the mixed-use projects that will receive funding, and were joined by Mayor Mike Duggan, Invest Detroit, Midtown Inc. and other City officials to celebrate the investments that will drive growth in the city.

“The RAP grant activates strategic Detroit developments to advance inclusive growth brick by brick,” said DEGC Chief Operating Officer and Executive Vice President Kenyetta Hairston-Bridges. “This critical funding has the potential to uplift our neighborhoods through impactful housing, jobs and services that Detroiters deserve.”

The five projects, totaling over $255 million in investment, will add density in impact areas through a combination of commercial space, market-rate housing and workforce housing. Developers were selected based on project location, readiness to proceed, organizational capacity, long-term community impacts, financial viability and local/regional strategic alignment. Preference was also given to proposals that featured mixed-use/mixed-income housing, historic renovation, emerging and minority developers and demonstrated site control. The DEGC will administer the projects in partnership with The City of Detroit’s Housing and Revitalization Department, Mayor’s Office Jobs and Economy Team (JET) and the City’s Grants Management Office.

“We are deeply appreciative to the MEDC for this generous grant to move these important neighborhood development projects forward, and to the DEGC for making sure Detroit developers have the support they need," said Mayor Duggan. "Each of these projects will take long-vacant buildings and turn them into vibrant neighborhood and commercial corridor anchors."

Four of the five projects are expected to start construction in the first quarter of 2024. The Jefferson School is already under construction and halfway through completion. The gap funding will be reimbursed to developers as phases of their project are completed. The DEGC will remain actively engaged throughout the projects’ construction to verify expenditures and help ensure project completion.

“Revitalization and Placemaking 2.0 grants underscore our commitment to the people, places, and projects that are integral to the growth of Michigan’s economy,” said Michele Wildman, Executive Vice President, Michigan Economic Development Corporation. “Investment in Detroit and communities across the state will help further the creation of vibrant places that attract and retain talent, enable business creation and attraction, increase new housing options, and provide resources for Michiganders and our communities to Make it in Michigan.”

The five projects recommended for funding through the RAP program include:

Broadway Lofts – The Broadway Lofts development will convert three buildings at 1322, 1326 and 1332 Broadway Street into a mixed-use property with 80 residential units and ground-floor retail space. Led by Roger Basmajian, the nine-story building will feature mainly studio and one-bedroom apartments, with at least 20% offered at affordable rates for those earning 60% of Wayne County's Area Median Income (AMI). The project will receive $4.275 million in RAP grant funding to construct approximately 50,934 rentable square feet of housing and 6,626 square feet of retail space.
Fisher 21 Lofts – The Fisher 21 Lofts project will convert a 600,000-square-foot building into 433 residential units with a mix of studios, one-bedrooms and two-bedrooms, plus 26,700 square feet of retail space and 17,685 square feet of co-working space. Led by developers Gregory Jackson and Richard Hosey, 63 units will be income-restricted affordable housing, with 60 at 80% AMI and three, two-bedrooms at 50% AMI. The development will receive $4.750 million in RAP grant funding.
The Arthur Murray Building – The Arthur Murray Building at 16621-16653 E. Warren Ave. has historical significance as the first franchise location of the Arthur Murray Dance Studio, founded in the early 1950s by pioneering female entrepreneur Doris Eaton Travis. The $14.9 million mixed-use development led by developer Emery Matthews will convert the abandoned 25,242 square-foot building into 32 residential apartments with 7,900 square feet of ground-floor retail space. The project will receive $2.128 million in RAP grant funding for redevelopment effort.
Jefferson Intermediate School – In 2018, Midtown Detroit, Inc. (MDI) and Invest Detroit purchased the Jefferson Intermediate School located at 950 Selden Street and 960 Frank Street with plans to renovate the building into a multi-tenant office and innovation/co-working space. The $44.4 million project will serve as the new headquarters for Invest Detroit as well as provide space for additional tenants interested in a creative office environment in Midtown. The development will receive $1.425 million in RAP grant funding.
The Deco – The development at 16703 E. Warren is an 8,000-square-foot, two-story commercial building that has been vacant for several decades along a high-profile Detroit commercial corridor. Led by developers Brandon Hodges and Damon Dickerson, the $4 million renovation aligns with neighborhood priorities around vacancy reduction, design aesthetics and small business opportunities. The project will receive $1.197 million in RAP grant funding to activate the long-vacant structure into six new rental apartments and a ground floor restaurant to be occupied by La Jalisciense Taqueria.

“We are extremely grateful for the DEGC's support for the renovations at Jefferson School,” said Marcia Ventura, Senior Vice President, Lending for Invest Detroit, and leader of the Jefferson School project. “The ability to redevelop and repurpose abandoned buildings that truly benefit neighborhoods is at the heart of Invest Detroit's revitalization strategy. We want to ensure that residents and businesses in the immediate area can utilize these spaces as well, which is why 20% of the space is reserved for emerging Detroit resident-owned businesses at below market rents. Grants like this are critical to making sure our developments are as inclusive as possible.”

An Urban Land Institute report found that Black developers comprise less than 5% of residential real estate developers nationally. Historical discrimination and ongoing systemic barriers have made it harder for Black entrepreneurs to access the capital needed to enter this industry. As part of a broader effort to address these longstanding inequities, the DEGC and City of Detroit are focused on expanding participation in a field where Black professionals have been significantly underrepresented. The majority of the Detroit-based projects receiving grant funding are led by African American developers.

“Detroiters are connected by the stories we share. This neighborhood and this building are full of stories of our proud past and our hope for the future,” said Matthews, who also serves as principal of Real Estate Interests, LLC. “We are grateful to be given the opportunity to continue the narrative. This is a project by Detroiters, for Detroiters, made possible by the essential assistance of the team at the DEGC and the MEDC’s RAP 2.0 gap financing program.”

“Our development team is humbled to have been selected for the RAP 2.0 grant. This award will ensure that we're able to execute a high-quality adaptive reuse of the subject property and offer affordable housing and community driven retail for residents and visitors,” said Hodges, who also serves as principal for TRIBE Development. “We're very excited about the activation along the E. Warren commercial corridor and are happy to be a part of its future.”

“This vital gap funding from the DEGC will enable the team to bring our vision for equitable, community-centered development to life in a neighborhood that has begun to receive transformative investment,” said Hosey, who’s also the owner and founder of Hosey Development, LLC. “Thanks to the leadership of DEGC and other partners, we have a seat at the table to create housing, jobs and amenities that reflect the community's aspirations. Our project will honor the history of this corridor while creating opportunities for existing residents. We look forward to getting to work and writing a new chapter for this neighborhood.”

“The RAP grant will bring to fruition the vision we have had on Broadway Street since winning an RFP to redevelop three historic properties six years ago. We have since been designing and redesigning the project as we deal with rising construction costs and interest rates, while staying true to our original promises to respect the history of the neighborhood and create density,” said Basmajian, who also serves as president and CEO of Basco Detroit. “With this grant we will be able to save these historic buildings, while adding significant residential units and affordability in Downtown Detroit's Paradise Valley Neighborhood. We are deeply honored and grateful for the MEDC, DEGC and Mayor Mike Duggan for supporting this project.”

Administered by the MEDC, the RAP 2.0 program was designed to provide access to real estate and place-based infrastructure development gap financing in the form of grants of up to $5 million per project for real estate rehabilitation and development, grants of up to $1 million for public space place-based infrastructure per project and grants of up to $20 million to local or regional partners who develop a subgrant program. Funds under the RAP 2.0 program must be expended before September 30, 2027. In October, MEDC approved $99.2 million in grant funding for RAP 2.0 projects across Michigan’s 10 prosperity regions.

About Detroit Economic Growth Corporation (DEGC):

Detroit Economic Growth Corporation is a non-profit organization that serves as Detroit’s lead implementing agency for business retention, attraction and economic development. DEGC is led by a board comprised of business, civic and community leaders. Its staff provides services for key public authorities that facilitate incentives and other forms of financing for projects that bring new jobs and investment to the City. DEGC also manages important initiatives to support small businesses and grow neighborhood commercial corridors. DEGC is dedicated to inclusive development and access to economic opportunity.

Original source can be found here.

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