FORD SITEGREEN

MANUFACTURING REUSE STUDY

January 11, 2010Presented by:

Jay DemmaBonestroo, Inc.

PRESENTATION TOPICS

Project History/Background Market Interviews Workforce Analysis Site Assessment Conclusions

SITUATION/CONTEXT

Closing of Ford plant in 2011; 800 employees

Declining manufacturing base Emerging green economy Green attributes of the Ford site

PREVIOUS STUDIES

2007: Redevelopment of the Ford Motor Company Site Five land use scenarios

2008: Green Cities Green Jobs Minneapolis Saint Paul HVAC Controls Sensors & Monitoring Systems Bio-fuel Systems

RFP SCOPE

1. “Feasibility study and cost assessment for redeveloping or reusing the existing Ford site, and perhaps the buildings, for a new manufacturer.”

2. “Identify the specific site characteristics and building needs, and employee qualities and skills, sought by manufacturers in each of the identified green industry sectors.”

3. “Identify the job skills needed in the identified green industry sectors.”

“Analyze the findings from the above work tasks to determine if the Ford site is appropriate for reuse by any of the identified industries.”

CONSULTANT TEAM

OVERVIEW OF RESEARCH PROCESS

MARKETINTERVIEWS

WORKFORCEANALYSIS

SITEASSESSMENT

OVERVIEW OF RESEARCH PROCESS

MARKETINTERVIEWS

WORKFORCEANALYSIS

SITEASSESSMENT

OPTIMALOUTCOME

NATIONAL TRENDS IN MANUFACTURING

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

1939 1949 1959 1969 1979 1989 1999 2009

Em

plo

ym

ent

(in t

housa

nds)

All Non-Farm JobsManufacturing Jobs

Source: US Bureau of Labor Statistics, CES database

US Non-Farm Employment, 1939-20091944

Mfg is 38%of jobs

1979 Mfg peaks at19.4 mil jobs

2009 Mfg is 9.3%

of jobs(12.4 mil jobs)

TRENDS IN GREEN INDUSTRIAL PARKS

Highly competitive environment “Green” has caught on among

economic developers Estimate of 100+ green parks

actively marketing nationwide All industrial properties, though, are

potential competition Many local governments

subsidize cost of clean-up, land, and sometimes rent

MARKET INTERVIEWS

In-depth interviews with green manufacturers (45-50 min)

Company decision makers Challenging environment

2,500 firms profiled 74 firms contacted (59 refusals) 13 completed interviews Several interviews with firms

outside of target industries (e.g. solar companies)

MARKET INTERVIEWS

Subsidies are essential Access to highways is important Green sites are desirable but not

essential Companies that sell direct to

consumers need to be perceived as green

Companies on a supply chain are not motivated by a need to be perceived as green

WORKFORCE ANALYSIS

Alignment of workforce skills at Ford plant with skills/staffing patterns in 5 green industries Electric vehicle manufacturing HVAC controls manufacturing Wind component manufacturing Sensors and monitoring equipment

mfgr. Bio-fuels component manufacturing

Evaluation of training center

WORKFORCE ANALYSIS

Industries with strongest overlap with Ford workforce are: Electric Vehicle Manufacturing HVAC Controls

Occupations with strong overlap & retraining potential Team assemblers Painters Inspectors Electronic & electromechanical equipment

assemblers Welders, cutters, solderers, and brazers

WORKFORCE ANALYSIS

Manufacturers are increasingly integrating production with design & engineering

Ford facility and workforce is almost exclusively production-based

Most interviewed maintain a more diverse staffing pattern (production, engineering, sales, etc.)

Location of site will draw interest from firms looking for young engineers, technical & professional workers as well as production workers

WORKFORCE ANALYSIS

Built in 1997 Classrooms, media center, auditorium,

robotics lab Could be valuable for retraining workers Most desirable among emerging industries

with new technologies and skills (e.g. solar and wind)

Location of training facility may seriously limit effective reuse of site Could be interim use in other redevelopment

scenarios

Training Center40,000 square feet

SITE AND BUILDING ASSESSMENT

Tour of site to identify issues and assets

Estimate costs associated with four development scenarios

Scenario 1: Demolish All Buildings

COSTSDemo: $8.2 mil

Construction : TBD

Manufacturing Sq Ft: TBD

Scenario 2: Reuse All Buildings

COSTSDemo: $0.7 mil

Const : $17.6 mil

Manufacturing Sq Ft: 2 Million SF

Scenario 3: Reuse Paint Building Only

COSTSDemo: $5.4 milConst: $5.8 mil

Manufacturing Sq Ft: 550,000

Scenario 4: Reuse Warehouse Building Only

COSTSDemo: $5.9 milConst: $2.7 mil

Manufacturing Sq Ft: 250,000

CONCLUSIONS

Development Scenario

Investment RiskMarket Potential

Among Green Manufacturers

Potential to Tap Existing Ford Workforce

Alignment with 2007

Planning VisionDemolish All Buildings and Rebuild

Most Flexibility for Market Absorption

Most FlexibleTiming of Job

CreationStrong

Reuse All BuildingsRequires Heavy

SubsidiesNominal

Strong For Electric Vehicles

Doesn't Allow For New Uses

Reuse Paint Building

Property Would Have Competitive

Lease RatesModerate

Opportunity for Immediate

Replacement

Allows for Mix of Uses

Reuse "Newer" Warehouse Building

Property Would Have Competitive

Lease RatesModerate

Opportunity for Immediate

Replacement

Loss of Valuable Land Along River

Road

Subjective Decision Chart

CONCLUSIONS

Expect Heavy Subsidies Focus the Marketing Effort

HVAC Controls Sensors & Monitoring Systems Solar Panels

Strategically Reuse Portions of the Site

Track the Economy and Time Any Investment

Consider Creating a Park or District with Strict Green Standards

QUESTIONS