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Nov
2015
30

$30M AFL-CIO Pension Investment Will Renovate Detroit Homes, Boost Union Workers and Apprenticeship

Detroit Mayor Mike Duggan is all smiles after the AFL-CIO's announcement

Detroit Mayor Mike Duggan is all smiles after the AFL-CIO’s announcement


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The AFL-CIO Housing Investment Trust (HIT) has announced $30 million of pension fund investment into Detroit’s Neighborhood Home Repair program. The work associated with the investment will employ union workers to renovate up to 300 blighted homes across the city and expand local apprenticeship, thus kickstarting careers for the local community, construction unions hope.  

Detroit Mayor Mike Duggan praised the AFL-CIO for its continued role in the growth of the city:

“It is wonderful to see the AFL-CIO, an organization that played such an important role in building Detroit, investing so much to help build Detroit again through the Housing Investment Trust.  This will create jobs and training opportunities to Detroit residents, and will do so much to strengthen our neighborhoods.”

AFL-CIO President Richard Trumka also touted the HIT’s decision, saying: “Union workers using union pension money to rebuild homes for working families is the right formula for rebuilding Detroit.”

The program will first concentrate on roughly 25 homes in the Bagley, Shultz, Crary/St. Mary’s, and East English Village neighborhoods of Detroit.  The plan is to find blighted houses that are surrounded by properties in good shape so that renovation will raise all property values in the area.  The rationale for the location of the neighborhoods was explained to Crain’s Detroit by David Eubanks, an assistant investment officer for HIT:

“We were looking at neighborhoods that were relatively stable.  We wanted to make sure the cost to rehab is limited to $25,000. We don’t want to stress the resources of the city.”

Following the initial renovations, HIT aims to expand into other neighborhoods.  The $30 million investment is expected to spread across a 3-5 year period. HIT Executive Vice President Eric Price told Michigan Public Radio that his first priority is a good return on investment. He sees Detroit as a safe bet: “We view this as the first investment, hopefully, of many.  We want to make this more than just this particular program.”

The Michigan Building Trades Council, Building Detroit Futures, Southwest Housing Solutions, and the Detroit Land Bank Authority will work together to ensure local residents find opportunities to become apprentices.  The plan will also be aided by a $900,000 Community Development Block Grant from the city.  Mayor Duggan said that using the grant money for this program is better than funding an effort to knock the buildings down.  

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