Detroit – — An Illinois developer is in talks with the Wayne County treasurer to buy the notorious Packard Plant out of foreclosure for its $974,000 unpaid tax bill and convert the decayed landmark into a commercial, housing and entertainment complex.
Bill Hults, of Evanston, Ill., told The Detroit News he’s leading a group of investors who want to rehabilitate the crumbling 3.5-million-square-foot plant and build housing nearby. To complete the transformation, Hults has retained the legendary architectural firm that built the complex in 1903, Albert Kahn Associates.
Crews could begin adding concrete barriers, fences and armed security guards within a week to secure the 40-acre facility on East Grand and Mount Elliott, said Hults. He said investors want to save as many of the 47 buildings as possible despite their skeletal state and then build multi-family housing nearby.
The project could cost at least $350 million and take up to 15 years, but the renovation of the Packard itself could be complete in several years, according to Hults’ early estimates.
“Packard is a global brand and has a global identity. It’s kind of like buying Coca-Cola,” said Hults, 57. “I couldn’t spend enough money to have that built-in identity. It would take a couple of lifetimes to build that. … If Packard wasn’t there or was bulldozed, we wouldn’t be doing this.”
Resurrecting one of the city’s most recognizable ruins would be a massive job, and critics question whether Hults’ plan is realistic. The developer acknowledged he hasn’t completed a project of this magnitude and has a mixed record in Chicago, where he left debts from a failed home building company.
“It will be no small feat,” said Nate Ford, a former director of the city Buildings, Safety Engineering and Environmental Department. “The whole integrity of the building has been compromised, top to bottom, side to side.”
David Szymanski, the Wayne County chief deputy treasurer, confirmed he’s been in talks with Hults for about eight months and that a sale to a company he recently formed, Packard Detroit LLC, could be completed within several weeks. Szymanski said within days he expects to give Hults permission to begin a cleanup pending the final sale so he can insure the complex.
“We want to make sure the neglect of this property does not continue,” Szymanski said. “If this comes to fruition, it will be a home run. I have a difficult time imagining any property that presents the issues that the Packard Plant does.”
Once a hub of innovation that made the nation’s most luxurious cars, the plant closed in 1956. Since then, it’s become a mecca for urban explorers, artists and scrappers. Its metal and windows have been picked clean, walls are disintegrating, floors have collapsed, and it’s the site of so many blazes that a website tracks whether it’s currently on fire. Most development proposals have focused on demolition, estimated to cost up to $20 million depending on the amount of asbestos remaining.
But the project’s experts are optimistic much is salvageable because when building the complex, AlbertKahn and his civil engineer brother Julius used techniques revolutionary at the time to strengthen construction, including their own version of rebar.
“The bones are still good,” said Rick Dye, a principal on the project at Kahn. “If you look deeper … it looks like the concrete is holding up pretty good. There are still decent structural capabilities.”
Vision tough to execute
Hults said he’s backed by local and out-of-state investors he can’t yet disclose. He said they’ll emerge once the project develops and include a humanitarian group that wants to spend at least $85 million on veteran and senior housing near the area.
He envisions converting the ruin into the Villages of Packard, a mix of startup businesses, shops and restaurants, a boutique hotel and affordable and market-rate homes. Proposed designs from Kahn’s group include a main entrance along Grand Boulevard featuring ground-level shops and angled parking.
The complex’s most recognizable feature — a covered bridge connecting buildings over Grand Boulevard — would be preserved as a focal point for the project. Hults said his group may add more glass windows and build a restaurant or coffee shop inside the bridge.
Hults said nine startups he’s affiliated with are expected to locate inside the complex. He said he is confident there will be demand from other companies.
“Detroit is blowing up,” Hults said. “Midtown in Detroit is 98 percent occupied. That’s crazy. There is tremendous interest.”
Eventually, Hults said he’d like to expand into nearby neighborhoods in a 630-acre triangle bordered by Interstate 94, Gratiot and Mt. Elliott that are dotted with vacant lots and abandoned buildings. He said he’s talked to city and school officials and private buyers about buying land for new multi-family housing.
The housing and some of the restoration of the main complex will be done using precast concrete walls the developers plan on manufacturing at a facility they are negotiating to buy near Coleman A. Young Municipal Airport, Hults said.
“We are going to try to employ everything we have to do in Detroit,” said Hults, who pledged to give hiring preference to city residents.
Hults said his group has money to launch the project and expects more funding to come as they sign on tenants. He said the group plans on applying for local and state aid, such as brownfield and historic tax credits.
“We have plenty of resources to do what we need in the short term. Something this large is going to have a variety of funding options,” Hults said. “Nobody goes into a project this size and has all the money on Day One.”
Douglass Diggs, a former city planning and development director who is now a consultant on mixed-use projects, predicted a “long, tough road.”
“It will be a very high cost to rehab and you probably won’t be able to recover those costs with the drop in rental rates,” Diggs said. “I would imagine it would be very difficult to put together the financing.”
“I would never say it’s impossible,” he added. “Ten years ago, people would have said the Fort Shelby or the Book Cadillac were impossible. The size and scope of the project, that would be a game changer for that neighborhood.”
String of unpaid debts
Hults has a low profile as a developer in the Chicago area and a string of unpaid debts. State and federal liens indicate he owes nearly $208,000 in back taxes. Hults disputed the figure, said the debt is closer to $50,000 and should be resolved soon.
In the early 2000s, he owned a company, Urban Homes Development Inc., that built about 30 housing units in Chicago using the same precast concrete system he hopes to bring to Detroit. The company collapsed prior to the 2008 market crash, leaving several debts to contractors, according to lawsuits in Chicago.
“We were in the same boat as every other developer. I plan on paying everyone,” said Hults, who added he is now involved in projects to build a boating and entertainment complex in Waukegan, Ill., and a bio-science facility in Elk Run, Minn.
Hults said he’s backed by investors who are a mix of private backers, foundations and real estate trusts. The humanitarian group involved in the Packard project is a collection of individuals and corporations that fund projects globally related to education, affordable housing and medical causes, said John Collier, who said his North Carolina-based company, CNS Ventures, researches projects for the group.
Collier wouldn’t name the group, saying: “They don’t need or want publicity for what they do.”
Hults has been working on the Packard deal for more than 15 months, first with the complex’s former purported owner, Dominic Cristini, and then with Wayne County Treasurer Raymond Wojtowicz’s office.
The county officially foreclosed on the Packard’s approximately 40 parcels in March for the $974,000 in back taxes dating to 2006. The plant was set to be sold in the fall tax foreclosure auction, but Szymanski said the county plans on brokering a deal with Hults and his Detroit-based attorney Joe Kopietz before the sale. Hults also may have to pay the city about $450,000 from a past debt tied to the property.
The deal may require the Wayne County Land Bank — which Wojtowicz leads — to acquire some of the parcels and sell them to Hults and his group, Szymanski said. Muncipalities and land banks by state law can buy foreclosed properties by paying the back taxes before they are auctioned.
Szymanski said his office has had no other interest in Packard. Hults and his buyers will be required to secure the building in six months or demolish it, according to the sale agreement.
Hults said he first was attracted to the Packard in 2011 on a tour of the city while visiting his older brother who lives in the area. Once cleaned up, the group plans several events to drum up interest including tours and street art contests.
“I can’t tell the future … All I know is I am making an effort to do this,” Hults said.
