A twice-delayed Detroit City Council decision on whether to give Dan Gilbert's Hudson's site project a $60-million tax break was delayed a third time today.
Gilbert's Bedrock sought the delay. Councilmember Coleman Young II, who supports the break, reportedly said it lacked the votes to proceed.
The Detroit Free Press reports Gilbert has said he can't get a bank loan to complete the project as planned without the funds:
Gilbert's Bedrock firm insists that the abatement, which would freeze property taxes for 10 years, is financially necessary because of the project's high costs and low anticipated return-on-investment.
Yet critics, including community activist groups, question whether such a tax break is needed when the project's two buildings are already well under construction and the ultimate beneficiary — Gilbert, founder of Detroit-based mortgage giant Rocket Mortgage — is one of Michigan's wealthiest businessmen. ...
"The tax abatement is necessary is because the bank won’t give us a loan without it," Jared Fleisher, the lobbyist for Gilbert and Bedrock, said during [a] June 20 information session hosted virtually on Zoom by council members Latisha Johnson and Mary Waters.
Anticipated costs have soared from $909 million to $1.4 billion since the 2017 groundbreaking, the developer's representative added.
Gilbert is contributing $1 billion in equity or cash, the lobbyist said, and the other $400 million would be borrowed. ... "We’ve been depending on this for five years." ...
Bedrock representatives did not respond to Free Press information requests for further details on the costs and financing, or for the identity of the bank that would refuse to loan money for the project without the tax abatement.
The Detroit Economic Growth Corp., a quasi-public nonprofit development agency, recommends approval of the tax freeze.