Packard Plant owner misses demo permit deadline; city considers next steps

The City of Detroit says it’s considering its next step after the owner of the Packard Plant missed a court-ordered deadline to apply for a permit to demolish the deteriorating industrial site.

Meanwhile, the owner continues to market the site to developers.

As of the close of business Thursday, Fernando Palazuelo had failed to apply for permit with the Buildings, Safety Engineering and Environmental Department, the Detroit Free Press first reported. As of Friday afternoon, the mayor's spokesman John Roach said he did not have the status of a possible permit application.

“As of the deadline at the close of business yesterday, no permits had been pulled for any of the properties listed in the court's order, so Mr. Palazuelo is in violation of that order,” Roach said. “At this time, the city is considering its next step to get these blighted properties removed.”

Last month, Wayne County Circuit Judge Brian Sullivan ruled that Palazuelo, a Peruvian developer, immediately raze the site and foot the cost and that his attorney missed a March 24 trial date. The city seeks demolition because it considers the location a "public nuisance." 

In the default judgment, Sullivan said structures on the two 2-acre sites on Detroit's east side have become "dangerous" and significantly threaten "the public's health, safety and welfare." He held Palazuelo "personally liable for the abatement of the public nuisance."

Palazuelo was ordered to get the needed demolition permits within 21 days and start demolition within 42 days of the judgment or by early June. Sullivan ordered the demolition and cleanup of the two sites to be complete in 90 days or by the end of June.

The demolition is expected to cost millions of dollars. 

If Palazuelo failed to demo the site, Sullivan empowered the city of Detroit to enter the two properties and "engage qualified contractors to perform all demolition and other necessary actions to abate the nuisance." Palazuelo would be expected to reimburse the city for the demolition costs.

Acting Detroit corporation counsel Chuck Raimi has said the city would consider doing the demolition itself if Palazuelo fails to do so. 

Despite the litigation, as of Friday, marketing of the industrial site continues, said Larry Emmons, senior managing director in real estate services firm Newmark's Southfield office. There are three industrial developers interested in the property, but no deal yet, he said.

"There's no shortage of buyers," he said. "We’re just trying to parse through those that can close and those that have big dreams."

In 2017, Palazuelo broke ground on a plan to redevelop the Packard into a mixed-use site and that would cost $350 million and take up to 15 years to complete. It never materialized. 

cwilliams@detroitnews.com

Twitter: @CWilliams_DN

Staff writer Oralandar Brand-Williams contributed.