City of Southfield sells former Northland Center to Contour Companies for $11.1M
Sale of property paves the way for massive mixed-use redevelopment
The city of Southfield sold the majority of the former Northland Center for $11,093,000 to Contour Companies of Bloomfield Hills following the Michigan Economic Development Corporation’s (MEDC) approval of a $26M Michigan Strategic Fund (MSF) investment on July 27.
Contour Companies (Northland City Center, LLC) have proposed a true dynamic mixed-use redevelopment including apartments at various rental rates, retail and restaurants, office and green space that very closely mirrors the City’s original vision for the Northland redevelopment based upon residents’ collective input.
“We are thrilled to be moving the Northland redevelopment project further closer to fruition,” commented Southfield Mayor Dr. Ken Siver. “Contour Companies vision for this property closely aligns with the City’s and we are confident that they will exceed all expectations. We are collectively grateful to the State of Michigan for the economic development incentives that will help to make it a reality. I believe that this dynamic and forward-thinking mixed-use redevelopment will be a major economic driver for the entire State of Michigan and serve as a model for other communities across the country.”
Contour plans to save the original five retail pads from the former mall as well as the underground tunnels and Hudson's building. Previous purchase offers and other developer interest in the property have all stipulated that demolition occur at city expense; however, this sale is based on Contour assuming the cost of demolishing the JC Penney's building, later mall additions and the 1974 enclosure of the free-standing structures. The company has already completed extensive work on its redevelopment plans which includes the adaptive re-use of the former Hudson’s Department Store, the underground tunnels and the original (1954) retail pads.
“The City purchased Northland because we wanted to control the destiny of this very strategic and historic property,” added Northland Steering Committee Chair/Councilman Dr. Lloyd C. Crews. “This redevelopment will create jobs and opportunities for our residents and provide our community with something that we can all enjoy and be proud of for years to come.”
The city of Southfield purchased the shuttered Northland Center mall at Eight Mile Road and the Lodge Freeway, located in the City’s Downtown Development Authority (DDA) District, from the court-ordered receiver in December of 2015 for $2.4 million with plans to remediate, demolish and sell the property to a qualified developer. The environmental assessment, asbestos abatement and remediation for most of the mall has already been completed in addition to the demolition of the former Target and Firestone buildings.
The overall project is expected to generate a total capital investment of $402.5 million, ultimately supporting the creation of the 500 new, full-time equivalent jobs, and will revitalize an underutilized site into high-quality commercial space and housing. The project will improve density and walkability in the area and is expected to serve as a catalyst for future development.
The City of Southfield Brownfield Redevelopment Authority received MSF approval of $26 million on July 27 in state tax capture for the alleviation of brownfield conditions at the site. In addition, the city of Southfield is contributing the local portion of the work plan valued at $35.4 million. The project is at a priority redevelopment site for the city of Southfield, which is making a total commitment of approximately $49.3 million in direct support to the project. This consists of predevelopment activities totaling $22.8 million which includes previously completed eligible activities totaling $4.1 million. The city has also agreed to provide future funding for eligible activities completed by the developer estimated at approximately $20.1 million and $2.3 million in future city eligible activity costs. The city of Southfield is certified with MEDC’s Redevelopment Ready Communities (RRC) program.
“The redevelopment of Northland will transform the property into a lively new urban center while respecting and reinforcing the history of the site, as well as its unique Mid-Century Modern design.,” said Contour Companies CEO David Dedvukaj. “The project consists of two phases: A 1,339-unit mixed-use apartment community that will provide comfortable and dynamic work-force housing in 14, five-story buildings. Six of these buildings will have a commercial component on the ground floor facing Greenfield Road. The massive J.L. Hudson Co. store, once the largest branch department store in the world, will be returned to use as the Hudson City Market, a vibrant food-and-specialty home furnishings marketplace, filled with dining and entertainment options. The marketplace will be developed in the spirit of the highly successful Ponce City Market in Atlanta. Phase II, located along Northwestern Highway and on J. L. Hudson Drive, will compliment and complete the development’s sense of community by incorporating more mixed-use residential buildings, townhomes fronting on a landscaped green space complete with a pond and other amenities. The landmark power plant will become a community clubhouse and the familiar Northland water tower will also remain in place.”
The Southfield City Council approved a master plan for the 114-acre redevelopment that is a conceptional, market driven blueprint that outlines the standards and vision for developers of the former mall property. Planning consultants OHM Advisors and Hubbell, Roth & Clark (HRC) conducted a thorough technical analysis of the site, examination of the existing buildings/structures, an assessment of environmental factors, and a market analysis to determine the best possible development potential for the former mall.
This closing follows the recent sale of five acres to Ascension Health for an expansion of the Providence Hospital campus. With the sales to Ascension and Contour, the City expects to ultimately be made whole on all of the funds invested in Northland redevelopment project.
About the former Northland Center and past, present and future Southfield
When Northland Center opened in March 1954, it was the largest shopping mall in the world, 20 years later, in 1974, the mall was enclosed. Northland led the way for Southfield to become a major commercial, business and residential center in metropolitan Detroit. At the time of the original center’s completion, Southfield’s population was only 25,000. Fifteen years later, the population had more than doubled to 69,000, and today the city boasts over 73,000 residents and a daytime population reaching 175,000. Alongside the contribution to population growth, the Center helped foster enormous office expansion. Today, Southfield boasts more than 27 million square feet of office space, making it one of Michigan’s leading business centers.
About Contour Companies
Based in Bloomfield Hills, Michigan, Contour Companies is all things real estate. From commercial and residential developments to multi-family revitalizations, the Contour stamp is designed with complete attention to detail, insuring that spaces blend seamlessly into their surroundings. Contour Companies’ mission is to provide residents with an at-home feeling, for comfortable and idyllic living.
About Michigan Economic Development Corporation (MEDC)
The Michigan Economic Development Corporation is the state’s marketing arm and lead advocate for business development, job awareness and community development with the focus on growing Michigan’s economy.
For more information, contact the Southfield Downtown Development Authority at (248) 796-5190 or the Mayor’s Office at (248) 796-5100.