Packard Plant to be fully torn down by year's end as city seeks new auto plant: Duggan

Detroit — The Packard Plant, one of Detroit's biggest symbols of blight, will be fully torn down by the end of the year and city officials hope to have a new automotive-related plant built on the site, Mayor Mike Duggan said during a Monday a press conference.

The city on Monday afternoon celebrated the start of the third phase of demolition at the massive decayed plant that used to house a luxury automaker almost 70 years ago, touting "promises kept." The city owns 42 acres of the location after Peruvian developer Fernando Palazuelo failed to comply with a 2022 court order to demolish the deteriorating industrial site and missed other deadlines.

The city will rehab the site for a new automotive factory in the next two years, the mayor said. Detroit's economic department in the next two months will open bids for land development plans, but is hoping for a new auto supplier, Duggan said.

"This project is monumental for the city's mission to (eradicate)...blight," said LaJuan Counts, director of the Detroit Construction and Demolition Department. “It symbolizes Detroit's resilience and its commitment to revitalization. As we look to a new era for this site, we honor the history of the old Packard Plant while embracing future possibilities for our city.”

Detroit-based contractor Adamo Group began demolition at 5409 Concord Street, comprised of about 200,000 square feet, on the southern section of the plant. This portion of teardown work is expected to take five months and cost $1.2 million to complete.

Three more portions of the plant will need to come down, Counts said. All told, about $26 million in American Rescue Plan Act pandemic relief dollars will be used to demolish the plant.

The Packard Plant spanned 3.5 million square feet on Detroit’s east side and was last active in 1956. Dozens of smaller businesses worked out of part of the factory until the late 1990s.

"Sixty-eight years ago, Packard Motors stopped operating at this plant and for 68 years, the ruins of this building have been a weight around the neck of Detroit's recovery," Duggan said. "Because of Joe Biden and the Rescue Plan, Detroit has resources that we've never had, and it will all come down in 2024."

On the other side of Grand Boulevard, environmental abatements have already started and $12 million in demolition will occur later this year.

The city has been chipping away at demolishing the Packard Plant for years. Emergency demolition began on a portion of the plant at 6199 Concord in September 2022. In December 2022, demolition started on the next major section of Packard at the south end of 1539 E. Grand Boulevard. The northern portion of 1539 E. Grand Boulevard has been secured for redevelopment to honor the plant’s history, city officials said.

The Packard parcel at 1539 E. Grand Boulevard was the last remaining city-owned portion of the plant up until 2022 when 33 additional parcels previously owned by Palazuelo's Art Express were converted to city ownership. The vacant property went into tax foreclosure due to $1.5 million in unpaid taxes, water drainage costs and blight tickets.

After small businesses abandoned part of the plant in the late '90s, the city foreclosed on the property and the facility began to be torn apart by scrappers and vandals.

Palazuelo paid $405,000 for the site at Wayne County's tax foreclosure auction in 2013. He tried to find investors to back a $350 million mixed-used development with industrial, offices, retail and cultural elements, but did not succeed. In 2021, the city sued Palazuelo and Arte Express to have the abandoned plant declared a public nuisance and torn down.

"But it's not enough to knock things down," Duggan said Monday. "Our economic department will be putting out proposals in the next two months for a new auto supplier for this site."

The Packard site is yards away from General Motors Co.'s Factory Zero. Duggan pointed to the redevelopment of the Cadillac Stamping on Conner and the old AMC Headquarters on Plymouth as examples of what could emerge.

"We are going to convert this from an abandoned building to a vibrant employment center over the next two years," Duggan said. "The one part of it we are preserving is on Grand Boulevard because this plant is a big part of Detroit's history. ... There will be a small section of the plant on each side of Grand Boulevard that will be incorporated in any developer's proposal so we can recognize the history at the same time we're building the future."

So far, no one has expressed interest in the site, the mayor said.

"There is significant demand in this location both for the Jeep plants and GM Factory Zero. This is a prime location," Duggan said. "We're going to start taking competitive bids this year... and hope to award this as the last of the walls are coming down."

Detroit City Council President Mary Sheffield said she remembers nine years ago when there was a proposal for the site.

"Unfortunately, that didn't work out. But we didn't give up, and I'm looking forward to a future for this site," Sheffield said. "We are committed to taking down blighted eyesores and creating productive spaces."

The site is located in the city's Gratiot Town Kettering area, comprised of seven neighborhoods that are excited to see the development, said Joshua Roberson, District 5 neighborhood manager.

"We have hope," said Valeria Berry, a community member who was invited by the city to speak. "I hope to be able to see a community garden, a playground for the children and a community building that will help bring us back together."

srahal@detroitnews.com

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