NEWSPAPER
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Federal bids cost Burroughs millions PAGE 23
..... Corporate art collections grow PAGE 30
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Decision on razing Stroh brewery nears PAGE 7
WEEK OF OCT. 21 - 27,1985 VOLUME 1 0 NO. 38
BetaWest reduces riverfront plan BY MARY SOLOMON SMYKA CRAIN'S DETR OIT B USINESS
Beta West Properties Inc., unable to sign an anchor tenant in the nearly six months since announcing plans for a Detroit riverfront Detroit office complex, has scaled down its plans. Instead of a 500 ,000 square-foot first phase, the Denver-based developer hopes to start construction on a 300,000-square-foot building after it signs a tenant for half the space. BetaWest says it is negotiating with potential tenants to rent the space. The smaller building would most likely be a "signature" building bearing the anchor tenant's name. Roy Fanning, director of the Detroit devel-
opment and an officer with BetaWest's Finance Development division, said the ultimate size of the project could still total the originally planned 2 million square feet. BetaWest will proceed with the threephased project initially announced, but the size of each phase will depend on demand, Fanning said. Beta West is a consolidated subsidiary of U.s. West Inc., a $7 billion telecommunications corporation based in Englewood, Colo. U.S. West is one of seven holding companies spun off when American Telephone & Telegraph was dismantled last year. Charles Berling, vice president for portfolio development for BetaWest, said potential reductions in tax benefits proposed by President Reagan have affected BetaWest's plans
nationwide. And Berling said that after the company looked more closely at the Detroit market, it concluded that a smaller building with the tenant's name on it would be more likely to attract a major tenant. The company also concluded that secondary tenants might need less space than originally thought or the tenants would prefer to be in a smaller building. The Detroit real estate and business communities are watching the BetaWest project closely because the unsubsidized project will probably have the highest rental rates in the metropolitan Detroit market. Many believe BetaWest, with its national connections, See BE TAWEST, PAGE 34
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Detroit River
MEDUSA CEMENT eo.
Millender: the project that 'couldn't be done'
Companies join for high-tech tanks
BY HARRIET NOLAN
KMS Fusion Inc. of Ann Arbor and Wayne State University have created a venture with two outstate businesses to go after lucrative defense contracts. Termed the Michigan Automated Vehicle Research Consortium (MA VRC), the group wants to develop the technology for "autonomous" - or remote controlled vehicles for the military, an expertise it says has the potential to reap billions of dollars in business for Michigan companies. Besides KMS Fusion, the companies involved are Lear Siegler Inc.'s instrument division in Grand Rapids and Teledyne Continental Motors' general products division
BY JANE WHITE CRAIN'S DETROIT B USINESS
Specia l to CRA IN'S DETROIT B USINESS
Begun in the depths of Detroit's depression, the Millender Center dodged bullet after bullet to rise in downtown's center. By all accounts, the $71 million Millender Center - the new hotel, apartment and retail complex almost didn't make it to this week's grand opening. "Everybody said th e Millender Center project couldn't be done," reca lled Mark Schlussel, president of the Southfield law firm Schlussel, Lifton, Simon, Rands, Kaufman, Galvin & J ackier . The firm represents Millender Center Associates, which leases the land and building from the city's Downtown Development Authority. Millender Center Associates is the organization set up by Cleveland-based Forest City Dillon Inc. to operate the center. Forest City Dillon, a subsidiary of Forest City Enterprises Inc., also codeveloped and built the complex. "The unanimous opinion of everyone was that it was going to be a great fiasco, a failure ," said Stuart Kaufman, the law firm 's vice president. Between the start of the project and its grand opening, a series of financial hurdles was overcome, chiefly with public loans. Now the center stands, with its 258-room luxury Omni International Hotel and restaurant, a 339-unit apartment complex that is virtually all leased, and an 1,850-space parking deck. Between 14 and 17 small re-
GLENN TRIEST
Attorneys Mark Schlussel (left) and Stuart Kaufman, on the roof of the parking structure of the Millender Center, say the project faced many roadblocks. tail shops will be leased in the future. The center is named for the late Robert Millender, a prominent attorney and mentor to many politicians, including Detroit Mayor Coleman Young. The Millender project was a long time coming. In the 1970s, businesses in the block bounded by J efferson, Congress, Randolph and Brush were given the boot when the city condemned their land to make room for a parking garage. Time passed. The parking lot was discarded in favor of a multiuse development on the premium
piece of land - across Jefferson from the Renaissance Center and next door to the City-County Building. Harold Varner, president of Sims, Varner & Associates in Detroit, said that in the late 1970s, his architectural firm submitted plans that included a bus terminal, hotel, office building, apartment complex and garage. In the meantime, Forest City had established a track record with the DDA because of its construction of the successful Trolley Plaza See MILLENDER, PAGE 33
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o The Metropolitan Center for Hig h Technology wi ll get an $8.2 million renovation. Story, Page 27. in Muskegon. Lear Siegler is based in Santa Monica, and Teledyne Inc. is headquartered in Los Angeles. The consortium intends to capitalize on the Department of Defense's plans to automate its vehicles, said MA VRC board member J im McNaughton, who is also director of aerospace systems at KMS Fusion. "The military wants to get the man out of the battlefield," McNaughton said. "Much like our factories of the See TANKS, PAGE 34
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Hamtramck is site of freezer warehouse BY AMY BODWIN CRAIN'S DETROIT B USINESS
A group of investors plans to open an $8.5 million freezer warehouse in the Hamtramck Industrial Park. The warehouse is being built by Superior Industries in Omaha , Neb. , a privately-held company that designs and constructs cold storage buildings. Superior is also a principal in the partnership that will own the 120,OOO-square-foot building. The partnership calls itself Freezer Services of Michigan.
The warehouse will serve both national and Detroit-area businesses, such as food wholesalers and processors that need refrigerated storage space, said Charlie Myers, president and chairman of Superior Industries. "Anyone who needs product refrigerated is a suspect for us as a customer," Myers said. Myers would not name other members of Freezer Services of Michigan but said the partnership is composed of about six businSee FREEZER, PAGE 7
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