Detroit Public Schools Property Transaction: Thorn Apple Valley

1. Detroit Public Schools Property Transaction: Thorn Apple Valley
Objective: DPS sought to drive efficiencies and improve service delivery by
consolidating various support services from around the city in a “hub” location, with
excellent access to all major transportation routes.
Rationale: Previously, maintenance activities were being conducted at a number of
disparate sites across the city, a practice that was wasted time and money because of a
lack of centralized management control. A hub approach is more efficient and saves
time and money in the long run.
Course of Action: DPS identified a site for a new maintenance hub, the former Thorn
Apple Valley meat packing facility located at 1425 E. Warren.
• Cost of the building, which was completely redeveloped and in turnkey (move-in)
condition, was $25 million.
• The building is accessible by major freeways and main routes, making all
services more efficient.
• A centralized service facility also allowed centralized management control.
Cost Considerations: The current DPS emergency financial manager compares the
reported sale price of the building a year earlier to a developer to the price DPS paid for
a fully redeveloped building in 2002.
• As a result of the consolidation, DPS estimated a 10-percent savings in service
manpower costs in reduced windshield times from the landlocked buildings
formerly housing service departments.
• The developer assumed a risk when purchasing and redeveloping the building.
• The Director of Audits at the state Department of Education agreed that the
turnkey approach met the spirit of the School Code for competitive procurement.
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