DETROIT, MI – Adient (NYSE: ADNT), the world’s largest global automotive seating supplier, today announced the company has acquired the 10-story, 164,000-square-foot Marquette Building located at 243 West Congress in Detroit’s historic financial district, across from Cobo Center.
The company will invest approximately $50 million into renovating the building to establish its global headquarters and bring roughly 500 jobs to the city of Detroit, of which approximately 100 will be newly created. Adient will work with the city to fill as many of those jobs as possible with Detroit residents.
Detroit Mayor Mike Duggan, Michigan Economic Development Corporation (MEDC) CEO Steve Arwood and Adient Chairman and CEO R. Bruce McDonald announced the plan at a joint press conference. They were joined by MEDC leadership, Detroit City Council members, Adient employees, local elected representatives and business leaders.
Adient debuted as an independent, publicly traded company after its separation from Milwaukee-based Johnson Controls on Oct. 31. The company will invest approximately $98 million in Detroit, of which $75 million will be for the acquisition and renovation of the Marquette Building.
“Adient’s decision to choose Detroit from among a large field of competitors to base its global headquarters is another major vote of confidence in where we are headed as a city,” said Mayor Mike Duggan.
Adient is the first Fortune 500 Company to establish headquarters in Michigan since Borg Warner moved from Chicago to Auburn Hills in 2003.
“We are excited to be a part of the growth occurring in the City of Detroit,” said McDonald. “It’s only fitting that we locate Adient’s global headquarters in the Motor City, and we have to thank the City of Detroit and the State of Michigan for the opportunity. Not only will we be bringing 500 jobs to downtown, we will also bring our history and commitment to supporting and partnering with communities where we operate. We are committed to being a good neighbor, a good corporate citizen and a vital part of the community.”
Adient’s Detroit presence is expected to generate approximately $17.2 million in income and property tax revenue for the city over the next 12 years.
For selecting Michigan as the site of its global headquarters, Adient will receive approximately $2 million from the Michigan Business Development Program for new job creation. The company looked at 40 potential sites within and outside of Michigan for its headquarters and ultimately selected the Marquette Building. In the coming weeks, a proposal will be sent to the City Council on a package of city incentives expected to include property tax abatements and brownfield tax credits.
“Adient’s decision to locate its operational headquarters in Detroit is both strategic and symbolic. We welcome Adient and appreciate their long-term commitment to the economic viability of Detroit and to being a key player in the automotive industry in Michigan, where they become part of a manufacturing and R&D community that is transforming the future of the auto industry and transportation around the world,” said Steve Arwood, MEDC CEO.
“We are going to undertake a complete renovation of the Marquette Building while preserving and honoring its place in the history of Detroit,” said Adient Chief Human Resources Officer Neil Marchuk. “Our employees, customers and suppliers will have a world-class facility to work in and visit, complete with collaborative work spaces, a product showroom, fitness center, food services, rooftop terrace and technologically efficient work spaces.”
Adient will be consolidating corporate functions from various Michigan locations to the downtown Detroit building once renovations are completed in approximately 24 months. In addition to the Detroit investment, Adient intends to refurbish its technology and engineering center in Plymouth, Mich.
“We are launching a 3- to 4-year project to completely restructure our Plymouth Technology Center,” said Marchuk. “Plans include creating agile team spaces that promote collaboration among internal teams, customers and suppliers.”
The company is still determining the required level of investment for its Plymouth facility.
The following represents the understanding between Adient PLC (“Company”) and the City of Detroit (“City”) with regards to the Company’s proposed establishment of its new global headquarters in the Marquette Building (“Building”) located at 243 West Congress (the “Project”). The terms and conditions contained in this Term Sheet are non-binding unless and until the Detroit City Council approves certain tax abatement certificates and a TIF for the Company, and the Company executes the City’s Tax Abatement Agreements (“Agreements”) that set forth these and additional mutually agreeable terms to which the Company and the City may both agree.
Project overview: The Company is proposing to move its global corporate headquarters to the Building and in the process will:
- Create approximately 500 jobs through a combination of relocating employees and creating new jobs
- Invest up to $50 million in the renovation of the Building including lead and asbestos remediation
- Become the fourth Fortune 500 company to be headquartered in Detroit and the first new Fortune 500 company to be located in the state of Michigan since 2003
Tax Abatement Incentives Package: The City will utilize commercially reasonable efforts to assist Company in obtaining the following incentives necessary for the Project:
- Obsolete Property Rehabilitation Act (OPRA), PA 146 of 2000
- Personal Property Tax Abatement, PA 328 of 1998, as amended
- Brownfield Tax Increment Financing (TIF)
Community Benefits: Company will comply with the community benefits process contained in Chapter 14 of the 1984 Detroit City Code, Article XII, titled Community Benefits, which consists of Sections 14-12-1 through 14-12-5. Company will comply with the terms of the Executive Orders to the extent applicable.
Conditions to Effectiveness:
- Detroit City Council approval of PA 146 of 2000 and PA 328 of 1998 tax abatement certificates, as well as a Brownfield TIF, for the Project.
- Execution by Company of Agreements, including the above terms and other terms as customary and not inconsistent with the foregoing.