It was the late 1970s. The region was hemorrhaging jobs to the South. Auburn Hills was not yet Auburn Hills; it was Pontiac Township. And then-Gov. William Milliken had an idea: the creation of a Michigan research and technology park to attract new high-growth technology and R&D jobs to the state.
Although the idea of a state-sponsored park never quite materialized, others were inspired by it and eventually the Oakland Technology Park with its more than 1,000 acres attracted large developments, the most recent of which have been on 211 acres of land purchased from Chrysler Corp. during its bankruptcy.
All told, that portion has attracted nearly $100 million in development from five major corporate relocations and consolidations totaling more than 900,000 square feet in North American or international headquarters space, according to Auburn Hills economic development officials.
The companies with new buildings in the technology park are U.S. Farathane Corp.; Henniges Automotive Inc., Faurecia North America Inc., Atlas Copco North America Inc., and Hirotec America Inc.
A joint venture between Southfield-based General Development Co. LLC and Farmington Hills-based Friedman Integrated Real Estate Solutions LLC purchased the 211 acres from Chrysler during its bankruptcy in 2010 for $2.5 million. The remaining 800 or so acres have multiple owners, the largest of which, FCA US LLC (formerly Chrysler), owns just over 500 of them. Others include Johnson Controls Inc. and Delphi Automotive plc.
“It’s the real northern boundary, at present, in terms of corporations and where they want to draw their workforce from in Oakland County,” said Gary Weisman, co-owner of General Development.
“It is between a lot of banking and shopping and housing,” he said. “It’s an all-inclusive city that is the northern boundary for large corporations in Oakland County, which are the kind of customers we deal with there, who go there for corporate reasons. They want to be next to other clients like themselves with the employee base.”
Paul Hoge, principal of Southfield-based Signature Associates Inc., said that while other large business parks in Auburn Hills were more fully developed sooner — in particular, Metro North Technology Park and Pinnacle Corporate Center — Oakland Technology Park is another example of the city’s business-friendly environment.
“Sometimes you’ll find a disconnect between the economic development people in a given city and the building department people,” he said. “The economic development people will all say we’ll welcome you with open arms, but sometimes building departments create more obstacles than they eliminate. Auburn Hills is not that way. They are very pro-business and they understand that time is usually of the essence.”
Milliken created the 12-member High-Tech Task Force to investigate the park’s creation and pitch a site for it. Ann Arbor was an obvious choice, but Auburn Hills — then largely rural — emerged as the frontrunner, with a vast swath of land bounded by I-75, M-59, Oakland University and Oakland Community College. OU’s president at the time, Joe Champagne, served on the task force, and some of the land that became part of the tech park had been owned by OU.
But roads and bridges had to be built, utility connections established and zoning changes enacted, said Steve Cohen, director of community development for Auburn Hills. The state, even though it had dropped the idea of a state-sponsored park at that point, still paid for highway and interchange improvements, while the city and Road Commission for Oakland County paid for improvements to roads surrounding the park and utility costs.
“This was Star Wars-type stuff,” he said. “All this had to occur to accommodate this large amount of development coming in. The state of Michigan, Oakland County and Auburn Hills all had to work together, and obviously the development community had to invest. It was a planned effort that everyone came together to do.”
Thirty years before the automotive development this decade, Comerica Bank opened a check processing and computer center on the property, stepping up to the plate to develop the land when the state stepped away from an agreement to buy the property.
“Someone needed to make the initial bold move and then someone followed,” said Tom Tanghe, city manager for Auburn Hills. “Someone needed to take a leadership position and invest.”
Then Electronic Data Systems Corp., owned by Ross Perot until General Motors Corp. purchased it in 1984 for $2.55 billion, developed on the land.
And slowly but surely, others followed suit, permanently changing the Auburn Hills landscape. For example, in a 1996 interview with Crain’s, then City Manager Dennis McGee said horses were still grazing the tech park land when he came to the city a decade earlier.
Fast-forward to today, and Auburn Hills is one of the bright spots in Oakland County development, regularly attracting new projects of the scope that have sprouted up in the past five years on the General Development/Friedman land.
And there’s more likely to come.
Of the 211 acres the JV purchased in 2010, another 70 or so remain available for new development.
By Dustin Blitchok, The Oakland Press
AUBURN HILLS >> Faurecia, one of the nation’s largest automotive suppliers, has invested about $30 million in new North American headquarters near University Drive and I-75 where about 700 employees work.
The French company has about 100,000 employees worldwide, and North American sales totaled $6.25 billion last year, or one-third of the supplier’s business.
The Auburn Hills headquarters and automotive seating technical center is “a key milestone in our development in North America and worldwide,” Faurecia Chairman and CEO Yann Delabrière said Wednesday.
Seats and interior components for Faurecia’s automotive clients are developed and tested in labs at the three-story, 278,000-square-foot building on High Meadows Drive. The company moved employees to the new facility from other locations in Auburn Hills and Troy.
Michigan Economic Development Corporation CEO Michael Finney said the state is home to more than 375 research-and-development centers.
“We’ve never had the focus on growing the auto sector that we have now.”
Finney said that when his son graduated from college, he told his father he wanted to work in the auto industry because of the technology that’s developed in the field.
Oakland County Executive L. Brooks Patterson said employment growth in the research-and-development side of the automotive business shows progress in diversifying Oakland County’s economy.
“Innovation is clearly driving the success of this company,” Patterson said of Faurecia.
The R & D work Patterson referenced was visible in the large, bright labs at Faurecia that work with everything from prototype construction to endurance testing.
Christopher Kus, 33, of Troy, conducts noise, vibration and harshness testing at Faurecia. Seats and even entire cars can be moved inside a room where the walls and ceiling are covered in dozens of perforated sound-deadening cones that bring noise levels to about 0 decibels.
When someone steps into the room and closes the door, their voice sounds different and even their balance can be affected by the deadened environment, which is used to evaluate the sounds made by parts such as seat motors.
“You can’t hear any quieter than this lab,” Kus said.
A dummy wearing a binaural ear, or microphone in each ear, sat strapped into a car seat in the room. Engineers consider factors such as how the window near a driver’s head, a “near field,” affects their perception of sound.
In the company’s pilot building lab, employees work on products that are being developed for manufacturing at plants as close by as Sterling Heights.
At the 23,000-square-foot validation lab, a small robot repeatedly pulled a headrest up and down to test its life cycle, something it will do 9,000 times. Another hydraulic robot nearby was applying a load to a seat to test fatigue.
Products are placed in environmental chambers to test them at temperatures ranging from minus 40 to 85 degrees Celsius, or minus 40 to 185 Fahrenheit.
The company’s metal shop builds prototype seats and components hands-on from engineering blueprints. Manager Jerry Lambert, 57, of Lake Orion, has worked at Faurecia for more than two decades.
“When I started here 24 years ago, there were only 18 (employees) in North America,” Lambert said. The company now employs more than 20,000 people at locations in the United States, Canada and Mexico.
Auburn Hills Mayor Kevin McDaniel said city officials have been looking forward to the opening of Faurecia’s new headquarters ever since approving the project last year.
“It’s great corporate citizens like Faurecia that make Auburn Hills a great place to live, work and play.”
To sustain its momentum, Faurecia North America grows into a new headquarters in Auburn Hills
Three years into a remarkable surge in growth, Faurecia North America today announced more details of its plans for a new headquarters building in Auburn Hills, Mich., at the hub of activity for southeast Michigan’s auto industry.
Since 2010, Faurecia—North America’s eighth-largest automotive supplier and the sixth-largest globally—has opened 15 new plants and tech centers in the U.S., Mexico and Canada and has nearly doubled the size of its workforce to more than 20,000. The region now accounts for 30% of Faurecia’s global sales. In Michigan, that growth has taken the form of six new locations since 2010 and a total of 13 sites that collectively employ more than 4,000 people. Its success has led Faurecia North America to begin construction this month on a new headquarters building that also will house technical centers for Faurecia Automotive Seating and Faurecia Automotive Exteriors.
“As the auto industry has reinvented itself over the past few years, Faurecia has been a notable success story,” said Faurecia North America President Mike Heneka. “We have grown substantially and now we are ready to extend our technical centers and headquarters operations to further support that growth. Our new location presents a distinctive opportunity to build from the ground up in a way that most suits our needs and to centralize our technical teams and administrative functions.”
The new headquarters facility, at 2800 High Meadow Circle near I-75 and University Drive, positions Faurecia North America in a more highly visible, easily accessible, more spacious location that is tailored to its needs. Upon the building’s completion in the spring of 2014, up to 700 employees will be transferred to the building from three smaller Michigan facilities: the current Faurecia Automotive Seating Technical Center on Meijer Drive in Troy; Faurecia’s Oakland Shared Services Center on Squirrel Road in Auburn Hills; and its Oakland Technical Center for Automotive Exteriors on W. Entrance Drive in Auburn Hills. The Faurecia Interior Systems Technical Center will remain at its current location at 2500 Executive Hills Blvd in Auburn Hills. Faurecia Emissions Control Technologies will continue to be based in Columbus, Ind.
The technical centers in the new facility will carry out prototype development, testing and light assembly activities to further Faurecia North America’s commitment to pioneering advanced vehicle systems to meet the auto industry’s evolving needs.
“Faurecia has called Auburn Hills its home for 10 years, and we enjoy an excellent relationship with the city’s leadership team,” Heneka said. “They have been a strong partner in the momentum we have generated, and we are pleased to be expanding our presence in the city.”
The layout of the new building will be more conducive to team work than were Faurecia’s other facilities and will enable program teams to sit together. Shop and testing areas will be upgraded and organized for improved efficiency, and considerably more meeting space will be available. The building will include a new showroom, dedicated innovation areas, numerous conferences spaces, a larger break room and plentiful parking for employees and visitors.
“Auburn Hills is thrilled to add Faurecia’s North American headquarters to our roster of leading national and international manufacturers headquartered here,” said Pete Auger, Auburn Hills City Manager. “Companies like Faurecia are terrific corporate citizens and bring tremendous value to Auburn Hills, solidifying our reputation as the premier global manufacturing address in the Midwest.”
Faurecia’s newest location will be constructed by General Development Company, LLC, of Southfield, Mich.
Faurecia is the world’s sixth largest automotive supplier with four key Business Groups: Automotive Seating, Emissions Control Technologies, Interior Systems and Automotive Exteriors. In 2012, the Group posted total sales of $22.5 billion. It employs 94,000 people in 34 countries at 320 sites and 30 R&D centers. Faurecia is listed on the NYSE Euronext Paris stock exchange and trades in the U.S. over-the-counter (OTC) market. For more information, visit: www.faurecia.com
About Faurecia North America
Faurecia North America had sales of $6 billion in 2012. Faurecia has 37 production sites, six technical centers, two customer centers and a shared services center in the United States, Canada and Mexico and employs more than 20,000 people in the region.
Atlas Copco to construct a 120,000 sq. ft. United States Headquarters for the tools and assembly division for, which consists of a customer center and an application center, on a 14.63 acre site zoned T&R, Technology and Research district. The property is located at the southeast corner of Cross Creek Parkway and Deepwood Drive, across the street from Marposs Corporation headquarters. Approximately 53,000 sq. ft. of the building will be utilized for office space, 45,000 sq. ft. for shop space, and 22,000 sq. ft. for warehouse space. Atlas Copco has been a world-leading provider of industrial productivity solutions for more than a century. Founded in 1873, Atlas Copco’s business has evolved into four distinct business areas. Their products and services range from compressed air and gas equipment, to construction and mining equipment, and industrial tools and assembly systems. The company moved to their current 58,748 sq. ft. Auburn Hills facility, located on Dutton Road, in 2006. The new building will provide the company an additional 61,252 sq. ft of space for future growth needs. General Development will be Developer and the General Contractor for the project. T he new facility in the Oakland Technology Park, which will employ approximately 225 people.
Leased a new NA Headquarters at 2129 Austin, Rochester Hills MI. GDC welcomes MPI Products LLC as a valued tenant. MPI is North America’s leading manufacturer of high-precision, fineblanked metal components for powertrain systems, hydraulic systems and other safety-critical automotive and industrial applications. Fineblanking is a dual-press stamping process for cutting, shaping and machining of highly engineered metal components that produces parts with uniform flatness, unparalleled dimensional accuracy, and near-net finish. The process is ideal for manufacturing geometrically-complex powertrain and transmission components.
In one of the biggest industrial real estate deals of the year, Auburn Hills-based Chrysler Group LLC signed a 400,000-square-foot lease in Redford Township.
The deal brought the 800,000-square-foot building from 35 percent occupancy to 87 percent occupancy, according to a statement from Farmington Hills-based Premier Equities, the real estate investment company run by David Friedman, which owns the building with Southfield-based General Development Co.
Chrysler will now use the space for parts distribution.
The building near Telegraph Road and I-96 was once used by Dearborn-based Ford Motor Co. for logistics. However, it has been largely vacant for the past few years.
The largest industrial deal of the year was the renewal of 632,000 square feet of space by U.S. Manufacturing Corp. in Macomb Township, according to Washington, D.C.-based CoStar Group.
However, the Chrysler deal represents the biggest new lease of the year, topping the 320,000-square-foot lease by Tognum America Inc. in Brownstown.
— Daniel Duggan
There were plenty of ear-to-ear smiles in Auburn Hills for the ground-breaking to celebrate the 55,000-square-foot headquarters for Henniges Automotive today.
Yeah, people are always happy at those events.
But this one was significant for a couple of reasons. The obvious: There have been very, very few of these events in recent history.
But the not-so-obvious reason for excitement on the deal is the math. Robert DePierre, CEO for the company, told me a little bit about his exhaustive search for office space. Buildings on the north side, east side and west side were all considered and then thrown out, he said.
“We looked at a lot of buildings and no one building had what we needed,” DePierre said.
Finding the combination of contiguous space, an additional lab component to be combined with the office space, and obviously the right price, was harder than it seems, he told me.
Matt Farrell, executive principal with Core Partners, and Randy Thomas, principal with InSite Commercial Group, the two brokers in the deal, said that the idea of new construction came up and proved to be a savings for Henniges compared to what he was paying in rent in Farmington Hills and compared to some of the rental options out there.
People talk all the time about how high the vacancy rate is for office space in metro Detroit, ranging from 15 percent to as high as 30 percent in some areas. But at the end of the day, brokers tell me over and over that Class A companies looking for Class A space have a very limited number of options.
While the cost to put up a building remains expensive, there are some exceptions to be found, as in this case. Driving the deal is that it’s in the Oakland Technology Park; land that was purchased for a song-and-a-dance from Chrysler in bankruptcy.
With the low land cost, Schostak Bros. & Co. is developing the building to lease to Henniges at a price competitive to using an existing building.
“As Michiganders, we have to benefit from moments like these,” said Gary Weisman, a principal with General Development Co., one of the owners of the park.
Weisman went on to say that through the tough times come great opportunities, such as the Oakland Technology Park. They bought 211 acres for $2.5 million – a price that would have landed them 6 acres of land in that park in 2006.
But it’s that ridiculous land cost that put the Henniges deal in the position to compete with existing buildings. It means bad news for development on land that people still value at $400,000 an acre, but good news for Weisman and his partners as they finish their second building in the park and think about doing more.
“After the meltdown, we begin anew,” Weisman said.
But at a lower price, he should have added.
The Farmington Hills-based auto supplier Henniges Automotive North America Inc. is set to break ground as early as next month on a 55,000-square-foot headquarters in Auburn Hills.
The deal marks the second in the Oakland Technology Park — former Chrysler Group LLC land purchased in March 2010 by Southfield-based General Development Co.
While General Development will develop the building, Livonia-based Schostak Bros & Co. will own it and lease it to Henniges, said Randy Thomas, president of Southfield-based Insite Group. Insite brokered brokered the deal along with Matt Farrell, executive principal with Birmingham-based Core Partners LLC.
Thomas said Henniges will move into a building that is smaller and more energy-efficient than its current headquarters. The developers will seek LEED certification for the building.
“It’s a deal that means a bottom-line savings in both rental costs and energy costs,” he said. “They’re right-sizing their space and getting a new, LEED-certified building, with a cost savings as well.”
Henniges Automotive, which also has offices in Germany and China, manufactures automotive sealing systems for doors, windows, trunks, liftgates, sunroofs and hoods, according to its website. It also supplies the automotive market with anti-vibration products, encapsulated glass, obstacle detection systems and other rubber components. It sells to all major automakers and has 4,500 employees worldwide.
In November, Chicago-based Wynnchurch Capital Partners sold Henniges Automotive to Greenwich, Conn.-based Littlejohn & Co. LLC for an undisclosed sum.
The company currently occupies a 75,000-square-foot building in the Farmington Hills Corporate Campus, according to the Washington, D.C.-based CoStar Group.
The deal continues General Development’s momentum in the park.
The Southfield-based company bought 211 acres from Chrysler’s liquidation arm, Old Carco L.L.C., for $2.5 million. The land had been valued as high as $400,000 an acre several years ago.
U.S. Farathane Corp. was the first to develop in the park, with the construction of a 78,000-square-foot building. It started as a lease and was later converted to a sale, with Farathane buying the building for $15 million and paying $2 million for some of the land around the building.
The holding company for the former Chrysler Corp. is closing today on the sale of 211 acres in Auburn Hills to a Southfield-based developer.
The property is the undeveloped portion of the vast Auburn Hills complex called Oakland Technology Park.
While some portions of the property were valued at as high as $400,000 per acre in past years, the entire 211 acres sold for $2.5 million, according to bankruptcy court documents.
It was purchased by General Development Co., said owner Gary Weisman.
Weisman, who has developed property in Rochester Hills and Auburn Hills for 25 years, said the land represents a great opportunity. He plans to create a corporate campus on the site, drawing medical, industrial, office and other corporate tenants over the long term.
General Development has built several sites in Auburn Hills, such as an $80 million facility for United Solar Ovonic L.L.C. in Auburn Hills in 2005 and a three-building complex totaling 158,000 square feet in 2000 along the I-75 corridor.
Weisman said the sale has been approved by the bankruptcy court and the final closing documents are being signed this afternoon.
“We are open for business,” Weisman said. “This is a tremendous opportunity for us to continue developing property in an area that has been a sweet spot for us.”
He declined to verify the sale price.
The “notice of proposed sale” document filed in U.S. Bankruptcy Court indicates the property was sold for $2.5 million. UGL-Equis Corp. represented Chrysler as a broker, the document states.
The property purchased is between I-75 and Squirrel Road, north of the Chrysler L.L.C. headquarters.
Weisman said there are no buildings on the land, but there are paved roads, street lights and property that is ready to be developed.
Weisman said he and co-owner, Bruce Brickman, have been on the sidelines for the last few years waiting for the right purchase opportunity to come along.
“We’ve kept our powder dry waiting for the right deal,” Weisman said. “This was it.”
Ryan Beene contributed to this report
Though Rochester Hills is often considered a bedroom community, industrial real estate brokers would beg to differ.
The industrial corridors near Hamlin Road, Crooks Road and M-59 have become among the most active in the area.
Buildings put up in the past 10 years are unlike the older manufacturing buildings in nearby Troy and Warren, fueling activity for companies looking for new images, said Peter Kepic Sr., a principal in the Southfield office of Colliers International.
He recently represented Southfield-based Thyssen Krupp Materials N.A. in a deal for 53,000 square feet of space at 2923 Technology Drive. After an extensive search, he said the image of Rochester Hills appealed to the company.
“They wanted an updated image,” he said. “That’s a high-tech corridor, and it fits the image of being a modern, updated, technology-driven company.”
In addition, two companies given grants by the Michigan Economic Development Corp. took space in the area: Rochester Hills-based fluid-handling company Rayconnect Inc. and Israel-based vapor valve company Raval USA.
Rayconnect plans to spend $14.5 million on a new plastics injection-molding assembly plant and headquarters. Raval plans a $7 million design, development and manufacturing center.
Dan Casey, manager of economic development for Rochester Hills, said the recent deals build momentum that will yield more deals in the future.
The Rayconnect development, for example, will be built on 25 acres of vacant land near M-59 and Crooks Road. Among the incentives for the company is a new industrial road providing access to the land.
“We could see another 300,000 square feet of development in the area from that road,” Casey said.
In addition, the city plans to widen Hamlin Road between Crooks and Livernois roads and is taking advantage of greater access to the corridors with the new Adams Road exit from M-59.
Transportation has become a major selling point, said Kris Pawlowski, a sales associate with Southfield-based Signature Associates.
“You have quick access to M-59, you’re seconds from I-75,” he said. “You’re west of the Mound corridor, just south of Chrysler, and you can head to Telegraph and get to I-275. It’s a location that will hold its value.”
His client Hot Melt Technologies Inc. looked at buildings in Auburn Hills, Shelby Township and other industrial hubs when it was considering a move from its longtime home on Hamlin Road, Pawlowski said.
After the search, the company decidied to build a new headquarters and plant next door to its current location.
Occupancy in the area is strong.
The area bounded by Auburn Road to the north, Livernois to the east, Hamlin to the south and Crooks to the west includes 104 industrial buildings and had a vacancy rate of 8.7 percent at the end of the second quarter, according to data from Bethesda, Md.-based CoStar Group. That figure is down from a five-year high in the first quarter of 2004 of 14.4 percent.
The city of Rochester Hills had a 7.2 percent vacancy rate at the end of the second quarter for industrial and flex properties. Current asking rate is $6.24 per square foot.
CoStar listed a 12.2 percent vacancy rate for the metro Detroit area with an asking rate of $5.06 per square foot.
Gary Weisman, owner of Southfield-based developer General Development Co., has built more than 1 million square feet in that corridor since 1984. He said it has become a place known for new buildings.
“We’ve looked at M-59 as the dividing line in terms of where to own products with the best opportunities for customers, but will also bring a return on our investments that’s better than the rate of inflation,” he said.
Daniel Duggan: (313) 446-0414, firstname.lastname@example.org