Plante Moran CRESA | BAE Breaks Ground in Sterling Heights
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BAE Breaks Ground in Sterling Heights 

 11/2/2009 


In one of the largest commercial construction projects currently in the state of Michigan, $31 billion defense contractor, BAE Systems, broke ground September 1, 2009, on what will be a new $58 million, 200,000-square-foot, state-of-the-art research and development facility. In attendance were elected officials and Senior BAE executives including: Governor Jennifer Granholm, Congresswoman Candice Miller, Mayor of Sterling Heights Richard Notte, Brigadier General David Ogg, and president of BAE Systems and Land Armaments, Linda Hudson.

Challenges


BAE Systems was looking for a location for an armored vehicle research and development facility. While one of BAE’s priorities was to be near key clients, it also wanted to have access to a talented workforce and to complete construction within a short time period. Many states were vying for BAE’s attention. BAE engaged Plante Moran CRESA to locate potential sites, identify incentives, and perform a project feasibility study.

Solutions


Plante Moran CRESA initially worked with BAE to identify locations that would, according to the company’s objectives, provide a workforce and location near one of its biggest clients, the U.S. Army Tacom Life Cycle Management Command. Plante Moran CRESA was also able to identify the tax incentives associated with each potential site. Because of available tax credits, the location of a former TRW automotive property in Sterling Heights proved to be the most strategically sound long-term investment for the company. Plante Moran CRESA represented BAE in the purchase as well as in leasing the temporary facilities.

Results


Acting as an owner’s representative, Plante Moran CRESA will work with and advise BAE on all phases of the project from concept to completion including demolition, design, and construction of the new facility.

The Sterling Heights campus, slated to span nearly 200,000 square feet on 81 acres, will represent a $58.4 million investment in the state of Michigan. It is expected to be completed by fall of 2011, with portions complete and occupied by summer of 2010. The campus will house 600 employees—400 of whom will be new hires.

The Sterling campus will feature a 250-seat auditorium and a virtual reality dome to accommodate modeling simulations and test programs. There are also plans to overhaul the existing test track and construct an adjacent 5,000-square-foot structure to support testing operations.

In addition, BAE intends to pursue the U.S. Green Building Council’s Silver Leadership in Energy and Environmental and Design certification.

Project Details


  • Completion: To be completed in late 2011
  • Cost: $58.4 million; more than $25 million in total tax credits over the next 14 years
  • Size: Nearly 200,000 square feet on 81 acres
  • Services: Asset positioning, buyer representation, capital markets, lease administration, project feasibility, real estate project management, site selection and incentives, strategic planning, and tenant representation
  • Results: Incentives include a state tax credit worth $22.1 million over 14 years and a $460,000 grant to train workers, while the city of Sterling Heights approved a 12-year, $4.6 million tax abatement