- The prospective buyer of the abandoned Packard plant in Detroit intends to develop it for auto suppliers, housing, artists and an upscale go-kart track.
- Peruvian developer Fernando Palazuelo bid $405,000 for the property at auction and has made a 10 percent down payment.
- After paying the balance by December 18, Palazuelo plans to move to Detroit in January, live at the site and begin leasing by April.
DETROIT — Fernando Palazuelo, the prospective buyer of the abandoned Packard plant in Detroit, intends to develop it into a facility that will house automotive suppliers, artists, residences, and even an upscale go-kart track.
The derelict Packard plant has become a symbol of the decline of the Motor City and an example of what's called "ruin porn."
Palazuelo revealed his ambitious plans to the Detroit Free Press, saying that once the $405,000 deal is completed, he also intends to live on the site in an apartment he'll build in the complex's former engine plant. He intends to move to Detroit in January and have his first lease signed by April 9, his 59th birthday.
As previously reported by Edmunds, the 40-acre site, with buildings totaling 3.5 million square feet went into foreclosure in March 2012 and was put up for auction in the fall.
Palazuelo, the third-highest bidder, won the right to buy the property when the first two failed to meet the conditions of the purchase agreement.
So far, Palazuelo has paid a 10 percent down payment on his bid of $405,000 and has until December 18 to pay the balance.
Once the sale is completed, Palazuelo said he will begin the clean-up of the site — no small task considering that its buildings have been vandalized, burned and left crumbling — and developing it for mixed use over the course of a decade or more. He estimates that renovating the property into space for residences, offices, light industry, art and recreation will cost about $350 million.
A trained architect, the Spanish-born Palazuelo now lives in Lima, Peru, where he has a reputation as an aggressive and resourceful developer with his firm Arte Express. He and his Peruvian team, most between 23 and 30 years of age, have renovated hundreds of buildings, including many in an area of Lima that was abandoned and considered wasted urban space.
With some of those projects, he lived on-site during the rehab work, and in all cases, attracting solid, paying tenants was a major challenge. Palazuelo's creative solutions included such ideas as low introductory lease rates and dedicated generators, an important consideration in Lima, where power can be intermittent. In Detroit, he says he'd offer prospective tenants several years of free rent.
And why a go-kart track?
Palazuelo is the father of five, including two sons who were highly ranked kart racers. His plan is to construct a track suitable for serious competition, as well as enjoyment by the general public.
Edmunds says: We're remaining cautiously optimistic at this point, but kind of excited about karting at the Packard plant.