DETROIT -- Prestige Automotive Group LLC plans to break ground Wednesday on an $8 million Cadillac dealership on 4.6 acres near General Motors' Tech Center in Warren, Mich.
The Warren City Council in December approved a tax break valued at more than $2.1 million for Prestige and its owner/operator Gregory Jackson, who is head of Jackson Automotive Management.
The move a mile north from the dealership's current site made sense for a number of reasons, Prestige said.
The new site will see heavier traffic patterns than the group's existing nearby Cadillac dealership, and it was logical when Prestige compared the cost of building the new dealership with the cost to renovate the existing store, Prestige spokeswoman Renae Logan wrote in an email.
Prestige also wanted to be a part of the Tech Center community, she said.
In May, GM announced plans to spend $1 billion to update its 60-year-old Tech Center campus in Warren.
The new Prestige dealership is slated to be completed by April 2016.
The new dealership site previously was home to a hotel, the Royal Conventry Inn. The sale of the land to Jackson initially generated backlash from a handful of city officials, who claimed the dealership would not adhere to the mixed-use development envisioned for the city’s "new downtown."
In 2002, the city bought the land through its Downtown Development Authority for $6 million, according to a C&G Newspapers report, then tore down the hotel as part of its plan for redevelopment of the civic center area. But the property where the dealership will sit has been vacant since.
Jackson and his dealership group paid $1.6 million for the property, Logan said.
The site plan for the new dealership, approved by the city in December, includes a two-story showroom, according to the C&G report.
Prestige acquired its existing Cadillac dealership -- previously Rinke Cadillac -- from Penske Automotive Group Inc. for $15 million in 2013. There are no plans at the moment for that site once the dealership moves, Logan said.
Prestige Automotive encompasses Warren Toyota, Prestige Warren Scion, Courtesy Ford in Okemos, Mich., and Mercedes-Benz Sprinter of St. Clair Shores, Mich.
Prestige reported $400.1 million in total revenue for 2014, down from $414.3 million in 2013 and $436 million in 2012.