Agreement Reached For Motorsport & Race Track In Howell
February 24, 2021
By Jessica Mathews / email@example.com
An agreement has been approved for the potential sale of property in the City of Howell where a large motorsport and racing track project is being proposed.
During an online meeting Monday night, Council approved an agreement between the City and JD Racing Indoor Karting LLC for the Highland-Howell property that totals 216-acres along I-96 between Lucy Road and Michigan Avenue, as well as two additional parcels to the north. The City has been actively marketing the main property for the past six years. It’s unclear what current plans look like but during an initial pitch to Council indoor and outdoor karting was described as a small aspect of the overall multi-use development that would be predominantly surrounded by high-end garage condos and a full size track for club members and availability for special events. No comments were made by JD Racing representatives at the meeting.
A press release from the City is attached. Jordan Dick of JD Racing said “We are grateful for the confidence City officials of Howell have shown us by selecting JD Racing to develop property which some have called ‘The Gateway to the City’. For us and what seems to be the feelings of people around Metro Detroit, the completion of our multipurpose Motorsports development can’t come soon enough”.
Extensive negotiations took place that resulted in the 24-month lease agreement, which would transition into a purchase agreement if certain milestones are met. There is an early termination clause for the tenant but at any point, they can buy the property for the previously agreed sum of $3 (m) million. At the suggestion of City Manager Paul DeBuff, the City shifted gears to a 24-month lease with an eventual transition to a possible purchase agreement. The purchase price would be $3 (m) million. DeBuff commented that the agreement will protect the City and not hurt the developers, who he said have been very open and patient while working through what is a fairly new process for the City. Minimum investments have to be made and developers will need to show proof of financing and name a guarantor, and be required to go through all of the normal planning processes just like any other project or applicant. There are extensive insurance requirements that must be maintained and staff was said to be very comfortable with the different benchmarks and triggers.
During a required inspection period, there is a concept plan provision to be provided to the City. Community Development Director Tim Schmitt comment that his advice to the applicants would to utilize that opportunity to get initial feedback utilizing the concept plan before making a formal submission under a separate governmental approval period. Schmitt said for a project of this nature, to have something of this magnitude just be dropped on the Planning Commission for a public hearing has generally not led to any positive outcomes. Schmitt said he had some thoughts as to how that process could go while utilizing the concept plan provision in the inspection period.
Mayor Nick Proctor commented he was very enthusiastic about the project when it was initially presented and thinks it could be a remarkable addition to the community but said his enthusiasm been tempered and he’s very concerned by the significant delays. Proctor added that granted when attorneys get involved, things get elongated but he’s very concerned it took seven months to get to this point. He said he supported the contract but also wanted to go on record that he’s pretty skeptical that there is sufficient motivation to see this vision to fruition. Proctor stressed that he really doubts their motivation and is concerned JD Racing will avail themselves of every contractually-allowable delay and he’s just not convinced there’s motivation to see a project to fruition. That all being communicated, Proctor said he hopes that he will be proved wrong.
City Attorney Dennis Perkins and an additional outside land development attorney have been working on the document. While there’s always inherent risk, it was stated that it’s a very heavily negotiated document that provides exit strategies and they were confident protections for the City were paramount. Perkins noted the agreement has been quite an endeavor and is the culmination of seven months of work, which retains ownership to protect the City and provides extensive assurances.
The agreement was approved unanimously and staff will now be working with JD Racing to get them access to all of the background information and paperwork on the property. It was stated that the City has a treasure trove of information and it would be highly unlikely the developers would discover anything new or issues of concern.
The agreement can be viewed in full via the Council packet. A link is provided.