New Wayne County Jail Construction.JPG

Progress of construction as of June 3, 2013 at the site of the new $200 million jail that has gone well over budget and may be scrapped.

(Gus Burns | MLive Detroit)

DETROIT, MI - The real estate arm of Quicken Loans founder Dan Gilbert’s affiliated companies has proposed a $500 million mixed-use development for a failed Wayne County jail site downtown that suddenly seems like a hot piece of property.

Eric Larson, managing partner of Bedrock Real Estate Services, said the firm had been working with the state and the county - before the county asked for RFIs - to help redevelop not only five buildings downtown, but also a facility at Mound Road.

“I think the biggest sort of difference in our proposal and our conversations with the county is that we are in talks with the county and had been prior to them issuing an RFI, helping them through a more holistic approach not just to downtown but also to the jail site,” Larson said.

The county jail project downtown has suffered from major budget problems, as projected costs have ballooned to about $65 to $100 million over budget, and a partially finished building stands idle at Gratiot and Madison.

Bedrock's proposal joins at least one other high-profile pitch to the county. On Wednesday, the owners of the owners of downtown Detroit's Penobscot Building and three structures adjacent to it, as well as the Pontiac Silverdome, told MLive they have submitted a proposal to the county for a $1 billion development that would include condos, retail and a 25,000-seat Major League Soccer arena at the site of a failed county jail project.

June West, a spokeswoman for Wayne County Executive Robert Ficano, did not respond to calls seeking comment Wednesday.

Steve Apostolopoulos, principal of Triple Properties, said the firm's proposed development would span about three blocks, encompassing the two county jails, the justice hall, the juvenile detention center and former Detroit Police headquarters on Beaubien Street downtown.

The development would create 1,000 jobs, including 500 "mid-income" positions and 500 high-salary jobs, Apostolopoulos said. Construction work would add another 2,000 jobs.

Both potential developments – that of Triple Properties and of Bedrock – would help put at least $20 million in property taxes in the city’s coffers.

Larson said Bedrock’s proposal would create at least 5,500 jobs at the downtown site alone. Bedrock is also working to convince the county to consolidate all jail services at an abandoned prison on Mound Road – a site that had originally been offered by the state to the county for a mere $1.5 million two years ago.

He said there has already been a significant amount of improvements to that 76-acre site, and infrastructure is already in place. “That in and of itself is a wonderful spring board as we try and migrate these activities,” he said, adding that his group envisions 7,000 to 9,000 new jobs at and around the site, as it attracts businesses to support activity there.

Meanwhile, on the 15-acre site downtown, Larson said all five buildings would be repurposed into a combination of residential and commercial properties. He said it would be a logical continuation of the investments Bedrock has already made in the area, such as the recent purchase of Greektown Casino and Hotel. All told, Rock Ventures and its 75 affiliated companies now control about 30 buildings and 7.5 million square feet of real estate in downtown Detroit.

“Our office product is filling up fast,” Larson said. “The residential market is at 98-plus occupancy, so there is really unique ability to repurpose those.”

While specific plans for the buildings are still in flux, Larson said Bedrock has commissioned the University of Michigan, Ernst and Young and the Smith Group to “help think through what we can accomplish.”

Larson would not comment directly on other proposals with the county, but did emphasize the seriousness of Bedrock's plans. “Our feeling is this is a time when we need to be very credible and very realistic in the city and in the county," he said. "Clearly there are very significant challenges, and we need to make sure proposals being put forth are credible and real.”