IAMC Spring Forum: Taking a Closer Look at Industrial Real Estate Trends

Last month, the Detroit Regional Chamber, in collaboration with the Michigan Economic Development Corp. (MEDC), represented our 11-county region at the Industrial Asset Management Council (IAMC) spring forum, “Industrial Real Estate in the 21st Century” in Tampa (pictured). IAMC is the leading association of industrial asset management and corporate real estate executives and site selection consultants in the United States.

The Chamber spent April 8-12 meeting with site selection consultants and real estate professionals to promote Michigan’s manufacturing and talent assets.

“What’s enticing to a lot of these site selectors working with clients in the manufacturing and automotive industries is our high concentration of engineering talent,” said Brian Bilger, senior business development representative for the Chamber. “Additionally we’re seeing a lot more positive word-of-mouth marketing about Detroit’s revitalization. Everyone is curious about the momentum surrounding self-driving cars taking place in Michigan.”

Both the opening of the American Center for Mobility in Ypsilanti next year and the state’s passage of the SAVE (Safe Autonomous Vehicles) Act give Michigan a leg up in the competition for talent and global investment, Bilger said.

“Attending events like IAMC are critical to putting Detroit and Michigan at the top of the list for site selectors,” he said. “Michigan has a lot of competition from Georgia, Tennessee, Ohio and Pennsylvania but when it comes down to it, the brainpower is here. The amount of engineering and IT students we have is a major advantage.”

The forum also helped shed insight on key issues and trends voiced by industrial real estate developers, such as a growing trend of big box store closures.

“What’s the impact on the community when these stores close? From an adaptive reuse perspective, do these empty buildings meet the needs of companies looking to expand? What types of incentives are available? These are all questions we have to get ahead of when site selectors come to us with a proposed project,” Bilger said.

Bilger said following the forum, the Chamber has remained in contact with site selectors representing companies from Chicago, Dallas, New Jersey and South Carolina that are exploring options in Michigan. Several are planning visits to Mcity in Ann Arbor and participating in the state’s familiarization tour in September, designed to build interest in Michigan’s manufacturing and industrial real estate market.

For more information on Forward Detroit, contact Marnita S. Harris at mharris@detroitchamber.com or 313.596.0310. To view a full list of investors and past Investor Exclusive content, visit our Investor Resources page.

Mitten State: Michigan’s World-Class Testing Facilities are Magnet for Tech Startups

By Rachelle Damico

Michigan is on the cusp of innovation for automated vehicle technologies, and startups are capitalizing on opportunity.

Testing facilities, such as University of Michigan’s Mcity, the American Center for Mobility and the recently announced GM Mobility Research Center at Kettering University, provide an opportunity to attract startups to the state.

Through a partnership between UM's Center for Entrepreneurship and Mobility Transformation Center called TechLab, UM's 32-acre test facility, Mcity, is available to startups such as Zendrive, Civil Maps and PolySync.

Through a partnership between UM’s Center for Entrepreneurship and Mobility Transformation Center called TechLab, UM’s 32-acre test facility, Mcity, is available to startups such as Zendrive, Civil Maps and PolySync.

Leading this trend is Mcity, UM’s 32-acre connected and autonomous vehicle testing facility. In February, UM’s Center for Entrepreneurship and the Mobility Transformation Center partnered on a collaboration at Mcity called TechLab, which provides transportation technology startups access to university resources.

This September, three startup companies from the West Coast joined TechLab — Civil Maps, PolySync and Zendrive.

“I think these companies are coming from the West Coast because they see a tremendous value here,” said Carrie Morton, deputy director of the Mobility Transformation Center. “Southeast Michigan and the state in general bring a lot to bear.”

Zendrive, based in San Francisco, was the first startup to join TechLab. The company uses technology aimed at improving safety for drivers by using a driver’s smartphone to measure actions such as breaking, accelerating, swerving and smartphone use. The company was established by former Google and Facebook employees, and secured $13.5 million in funding this year from venture capitalists and other firms to improve their technology and hire additional team members.

Civil Maps, based in Albany, Calif., also secured funding. The company develops 3-D maps using artificial-intelligence software to direct autonomous vehicles. In July, Civil Maps raised $6.6 million in seed funding led by five investors that include Ford Motor Co.

PolySync, based in Portland, Ore., is developing an operating system built for the high-bandwidth requirements of autonomous driving.

“These companies are finding really interesting partnerships and talent that we hope will lead them to become permanent fixtures in Southeast Michigan,” Morton said.

There has been so much interest from both startups and students that TechLab is looking to expand, Morton said, adding that UM hopes to add another three startups to the program in the near future.

“…It’s a great opportunity for the state to make sure that this technology is developed here,” Morton said.

In the coming years, the region is likely to attract other startups with the addition of the American Center for Mobility.

The 335-acre Willow Run site will become an advanced automotive testing and product development center that can test vehicles at various weather conditions, including ice and snow, at highway speeds.

“Both as an attractor and retainer of talent, I think this offers a much wider array of opportunities, particularly for our young people who are getting educated at our universities,” said Steve Arwood, CEO for the Michigan Economic Development Corp.

The state contributed $20 million to the Ypsilanti Township-based site, which is expected to open at the end of next year.

The American Center for Mobility at Willow Run is an advanced testing and product development center scheduled to open in 2017. It is designed to test vehicles in a variety of real-world environments.

The American Center for Mobility at Willow Run is an advanced testing and product development center scheduled to open in 2017. It is designed to test vehicles in a variety of real-world environments.

“I think this certainly is our opportunity to advance our thinking in how we situate ourselves for economic development given where this is going,” Arwood said. “We’re in a position where within two to five years we may see the rise of one or two new automakers or OEMs.”

Ann Arbor SPARK initiated the project and will play a key role in economic development tied to the Center.

“We see a great deal of potential for lots of different companies to start up and grow to scale,” said Paul Krutko, Ann Arbor SPARK’s president and CEO.

Krutko said an adjacent property on the project’s site may be used as a devoted space for early stage technology companies to collaborate with bigger players in the industry. He also said the Center has been in touch with companies from Silicon Valley that are interested in its capabilities.

“I think it will be really important not only in retaining talent, but attracting talent here, because there’s going to be great opportunities to be a part of,” Krutko said.

Glenn Stevens, executive director of the Detroit Regional Chamber’s MICHauto initiative, said Michigan’s testing sites are a selling point for not just established technology companies, OEMs and suppliers, but also puts Michigan on the map among national and international companies looking to expand their prescence in the United States.

“The entire ecosystem for the development of automotive and next-generation mobility exists here in Southeast Michigan,” Stevens said.

Stevens, who sits on the American Center for Mobility’s Land Services Board, has been instrumental in helping establish the legal and financial operating parameters for the testing site.

MICHauto has also been a key voice in strengthening the state’s global leadership in mobility development for connected and autonomous vehicles through its partnership with the Michigan Mobility Initiative.

“It’s extremely critical for Michigan to use its presence in leadership and automotive as a platform for diversification into next-generation mobility because the economic opportunity for new companies, new technologies and new deployment of technologies is extremely immense,” Stevens said. “Our future depends on it.”

Rachelle Damico is a metro Detroit freelance writer.

Michigan Cements Mobility Leadership with American Center for Mobility Groundbreaking

One of the 2016 “To-Do” list items from the Mackinac Policy Conference is to support the establishment of the American Center for Mobility at Willow Run. A special event, held on Monday, Nov. 21, makes achieving that goal, well on its way.

Gov. Rick Snyder, U.S. Sens. Debbie Stabenow and Gary Peters, U.S. Rep. Debbie Dingell, D-Dearborn, John Maddox, president and CEO, American Center for Mobility, and Steve Arwood, CEO, MEDC, as well as some of the state’s top automotive technology leaders were on hand to celebrate the official groundbreaking of the $80-million project in Ypsilanti Township.

“This is a significant day for Michigan,” said Glenn Stevens, executive director of MICHauto at the Detroit Regional Chamber. “We put the world on wheels and now we are leading the world in bringing autonomous vehicles to the world.”

As one of the founding partners of the Michigan Mobility Initiative, MICHauto worked tirelessly to keep the Center’s opening a focus for the state.

Stevens, who sits on the Center’s Land Services Board, has been instrumental in helping establish the legal and financial operating parameters for the testing site.

The Center, located on 335 acres at the existing Willow Run site, is designed to test new and emerging technologies and will play an integral role in positioning Michigan to lead in the race for the connected and autonomous vehicle development.

The Center will be available for use by private industry, government, academia, among others and will serve as a technology hub, allowing companies to lease office space, garages and other amenities.

Construction is scheduled to begin next spring with the Center being open for business by December 2017.

More information on the American Center for Mobility can be found at www.acmwillowrun.org. To learn more about the future of mobility and its importance to Michigan’s ongoing economic resurgence, visit www.planetm.com.

Clayton & McKervey Proud to Support the American Center for Mobility

Clayton & McKervey is pleased to announce it will provide financial and accounting consulting to the newly funded American Center for Mobility, working in collaboration with the board of directors and the Michigan Economic Development Fund (MEDC).

Located at the Willow Run site in Ypsilanti Township, the center will help accelerate advanced mobility vehicle development safety while bringing economic opportunity to southeast Michigan and the United States. The MEDC previously announced approval of a $2,999,900 million performance-based grant and $100 equity investment in funds to support the American Center for Mobility, from the Michigan Strategic Fund (MSF). On Tuesday, July 26, 2016, the MEDC announced that “the MSF approved a $17 million investment for the finalization of the acquisition of the land at Willow Run, operations and to facilitate the design and construction of phase one of a state-of-the-art global center for research, development and testing for automated vehicles.”

“We are honored to be working with the state of Michigan to help advance the future of our economy through next-generation vehicles,” said Clayton & McKervey Principal – Assurance Julie Killian. “Clayton & McKervey is excited to share our knowledge with the leaders of this visionary work.”

The American Center for Mobility is a joint initiative among the State of Michigan – including the Michigan Department of Transportation and MEDC, the University of Michigan, Business Leaders for Michigan and Ann Arbor SPARK.

Clayton & McKervey is a metro Detroit-based accounting and business advisory firm helping internationally-minded, growth-driven companies compete in the global marketplace. The firm was established in 1953, and services clients throughout the globe. To learn more, visit claytonmckervey.com.

Global Automotive Forum Offers Insight Into Future of Mobility Industry in China

As part of a strategic effort to learn more about Chinese automotive market trends and strengthen existing industry relationships, the Detroit Regional Chamber traveled to Chongqing, China in June to participate in the 2016 Global Automotive Forum. The three-day trip provided an opportunity to share the current state of the auto industry in Michigan with leading Chinese industry executives, as well as explore developments in electric vehicle manufacturing and the connected and autonomous vehicle landscape in China.

The trip builds on the Chamber’s longstanding relationship with the Chinese Council for the Promotion of International Trade (CCPIT) and was conducted in partnership with the Michigan Automotive Industry Office and Michigan-China Innovation Center.

While abroad, Justin Robinson, the Chamber’s vice president of Business Attraction, attended several events around the show and participated in a panel discussion on doing business with the Michigan automotive industry attended by representatives from Chinese suppliers. Kevin Kerrigan, senior adviser for automotive initiatives at the Michigan Economic Development Corp. (MEDC), also led a panel discussion on connected and autonomous vehicle development and electric vehicle development for over 600 attendees.

Robinson said a key takeaway from the trip was the stark difference between the two countries on a next-generation mobility strategy and current progress by our respective domestic suppliers in this space.

“While the U.S. has made a pretty full pivot into connected and autonomous technology, China’s priority still seems to be focused on new energy/electric vehicle development,” he said. “We are roughly a couple years further along in the connected mobility discussion with the exception of a very small number of leading Chinese automotive and technology firms.”

That’s where Michigan’s numerous research and development and vehicle testing assets, such as the American Center for Mobility at Willow Run, will benefit the state and country in the long-term, Robinson said.

“How can Chinese companies keep up with the technology demands of both new energy and connected and autonomous vehicle markets? Most of the Chinese OEMs and suppliers don’t have the dollars to invest in that type of research and development. It will be interesting to see how that plays out,” Robinson said.

Other key takeaways:

  • Chongqing is China’s largest manufacturing base. The city has an annual auto capacity production of 4 million vehicles with Chang’an and Ford Motor Co. making up a large percentage of this capacity.
  • Chinese brands held over 30 percent share of the Chinese passenger auto market in 2015.
  • Chinese industry execs know that the country must transform its smart mobility strategy as the industry continues to rapidly develop due to disruptive technologies. The challenge is that China’s domestic auto industry lags behind the world’s auto powers in terms of development levels, professional expertise and other related criteria.

In addition to the Automotive Forum, the Chamber and MEDC traveled to Chengdu, China in support of Michigan’s sister state, Sichuan Province. While there, the team met with Sichuan government leaders and a small number of Chinese OEM and Tier 1 suppliers with a focus on electric and autonomous technology.

As a follow up, the Chamber assisted with the hosting of the Executive Vice Governor of Sichuan to the Detroit region at the end of June featuring 80 delegates from government, industry, education and tourism. The visit was anchored by a reception hosted by Gov. Rick Snyder, and a tour of the city hosted by the Chamber featuring delegation representatives and Sichuan Executive Vice Gov. Wang Ning.

For more information on Forward Detroit, contact Marnita Hamilton at 313.596.0310. To view a full list of investors and past Investor Exclusive content, visit our Investor Resources page. For more information on Business Attraction, contact Justin Robinson at 313.596.0352.