Ford Buys Historic Train Station in Detroit for Redevelopment
June 19 2018 - 3:15PM
Dow Jones News
By Christina Rogers
Ford Motor Co. has purchased a long-abandoned train station in
Detroit and is planning to redevelop it as a technology hub for
electric and autonomous cars.
The 18-story beaux-arts building has for decades stood as a
towering symbol of blight in the city, with busted out windows,
graffiti-covered walls and razor wire fencing circling the
perimeter. Completed in 1913, the historic Michigan Central Station
building once served as a rail hub for Detroit before ceasing
operations in the late 1980s.
The Dearborn, Mich., car maker isn't disclosing the purchase
price or the cost of the project, which also includes acquiring
other land nearby and creating a downtown campus that would span
1.2 million square feet when it opens in 2022.
Located less than 10 miles from Ford's suburban headquarters,
the new campus will provide office space for about 2,500 Ford
employees. It will also include mixed-use space for retail,
residential housing and offices for other employers.
The move comes as Chief Executive Jim Hackett is working to
implement a corporate "fitness" plan that aims to slash $25.5
billion in cumulative costs over the next four years and help Ford
catch up with its two Detroit rivals on profitability.
Ford, once the healthiest of the Detroit car makers, is
forecasting earnings will fall for a third straight year in 2018,
and its stock, closing at $11.99 a share on Monday, has lagged
behind the broader market since Mr. Hackett took over in May
2017.
Ford says the redevelopment costs won't add any incremental
spending because the money was already budgeted as part of a
previous plan to overhaul its main suburban campus.
Longtime Chairman Bill Ford Jr. is spearheading the campus
project, saying he hopes it will serve as a catalyst for other
high-tech startups and businesses to locate in the Motor City.
Ford is hoping the creation of a downtown campus will help it
recruit younger, tech-savvy workers from Silicon Valley and
elsewhere as it aims to transform itself from an old-line
manufacturer to a seller of high-tech transportation services.
"Even as we're cutting costs and getting ourselves fit, we also
know we have to invest in the future," Mr. Ford said during an
event at the train station.
The company has already acquired other nearby properties in
downtown, including a former pantyhose factory that it has turned
into office for employees working on driverless and electric
cars.
This isn't the first time Ford has tried to spur development
downtown. In the 1970s, Henry Ford II -- the founder's grandson --
led the construction of the Renaissance Center, a collection of
office towers that sit on the Detroit River waterfront. General
Motors purchased the complex from Ford in the mid-1990s and made it
its world headquarters.
Write to Christina Rogers at christina.rogers@wsj.com
(END) Dow Jones Newswires
June 19, 2018 15:00 ET (19:00 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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