A large proposed mixed-use project on the outskirts of downtown Pontiac has taken a major step forward in its financing.

The Michigan Strategic Fund has given its blessing to a $79.2 million transformational brownfield program package for The Exchange, a nearly $106 million redevelopment and new construction effort on approximately 7.5 acres at the northeast corner of West Huron Street and Woodward Avenue.

The Exchange — not to be confused with a project of the same name in downtown Detroit — would include a new $80.2 million, nine-story, 287-unit apartment building called The Exchange Flats; a $16 million redevelopment of the former Oakland Press building at 48 W. Huron St. into 75,000 square feet of event and community space, plus a food hall; and a $9.2 million redevelopment of a former department store building at 91 N. Saginaw St. into 59,000 square feet of office space geared toward small businesses and nonprofits.

According to MSF board briefing documents, 57 of the 287 rental units in The Exchange Flats would be deemed affordable at 80% of the Area Median Income. In Oakland County, 80% of AMI for a two-person household is $61,440, while it’s $76,720 for a four-person household. Generally, a one-bedroom at 80% of AMI is $1,440 per month, while a two-bedroom is $1,728 and a three-bedroom is $1,995, under Michigan State Housing Development Authority guidelines.

In addition to the TBP award, the project has received approval for a 12-year Obsolete Property Rehabilitation Act tax abatement valued at $1.28 million and a 15-year Neighborhood Enterprise Zone abatement is anticipated for approval in the spring 2027, although the value of that has not yet been determined, according to the MSF board briefing documents.

The construction timeframe is not known.

It is being spearheaded by Alan Bishop, the founder of the Mr. Alan’s sneaker chain that started in 1974 and whose commercials were a fixture on metro Detroit TV stations in the 1980s and 1990s. The company was bought in 2019 by the German-based streetwear brand Snipes.

Bishop, in a text message, thanked the Michigan Economic Development Corp., the MSF, city of Pontiac and Oakland County, and said he is “very excited to continue our project in Pontiac.”  

In effect, transformational brownfield funding for large-scale projects comes from the following buckets: tax-increment financing on state property taxes at the developed property over 30 years; exemption on 100% of the state sales tax on construction materials and 100% of the state income tax on construction labor; a 20-year capture of 50% of the state income tax on permanent employees at completed buildings; and a 20-year capture of 100% of the state income tax on residents of new residential properties.