The city of Detroit has announced yet another partnership to rehab blighted homes.
Now it’s with the AFL-CIO’s Housing Investment Trust, which uses labor pension fund money to finance a variety of housing projects.
Executive Vice President Eric Price says the HIT’s first priority is to get a good return on investment, and it now sees Detroit as a good bet.
“We view this as the first investment, hopefully, of many,” said Price. “We want to make this more than just this particular program.”
Detroit Mayor Mike Duggan says the idea is to start small, and hopefully expand from there.
“We’re going to try this on the first 25 [homes],” Duggan said. “Like so many things, we are trying things that haven’t been done before.”
The housing trust will be rehab and sell the properties, said Duggan, adding that the city and trust will find a way to share “upside or the downside” depending on how much the houses ultimately sell for.
The program will target four neighborhoods to start, “And if it’s going well, we’re just going to keep expanding it to more and more neighborhoods,” Duggan said.
AFL-CIO officials say the investment could ultimately increase to $30 million and 300 homes over the next 3-5 years.
The Michigan Building and Construction Trades is also on board, saying the program “aims to create a sustainable and replicable model program to acquire, repair, and finance abandoned homes and properties in the Detroit Land Bank Authority inventory utilizing union labor,” city and union officials said in a joint statement.
The Detroit City Council will need to approve the transfer of the first 25 properties from the land bank. That’s expected to happen Tuesday.