©2016 Michigan Economic Development Corporation

MEDC Helps Attract Kmart's New High-Tech Center to Troy

Monday, August 21, 2000

John Truscott
(517) 335-6397

753 New Jobs for StateGovernor John Engler announced today that the Michigan Economic Development Corporation’s (MEDC) incentives package has helped bring Kmart Corporation’s new high-tech development center to Troy.The MEDC won the project by making a competitive business case, against Kentucky, to expand in Michigan with a Single Business Tax credit and job training assistance. Kmart Corporation selected Troy over Louisville, Kentucky, for their new high-tech development center that will spearhead the overhaul of corporate-wide information systems.It is estimated by an economic analysis that this high-tech center will create 753 new jobs, 450 in the company, for Michigan workers.“Kmart, under the new leadership of Chuck Conaway, is making significant strides in restructuring their corporation for maximum profitability,” Engler said.“The fact that Troy is part of this new plan shows Kmart’s continued commitment to Michigan and proves the quality of the local workforce.”The new center will be located on West Big Beaver Road, near Kmart’s world headquarters.It will require a company investment of about $50 million, including building renovations and equipment purchases. “ Troy is excited about the continual growth of Kmart Corporation on Big Beaver Road.The latest investment will lead the way to a more technologically competitive company,” saidJohn Szerlag, Troy city manager.“ The nearly $50 million project will upgrade and equip an 80,000 square foot facility near its headquarters.”Of the new jobs, 303 spin-off jobs will be created from increased spending by people who receive income from the jobs at the Kmart Corporation, according to an economic analysis done by the University of Michigan.A key feature of the MEDC incentives package is a Michigan Economic Growth Authority (MEGA) tax credit, approved today by the MEGA board, worth an estimated $15.9 million over 14 years.MEGA, which is administered by the MEDC, is used to promote high quality economic growth, job creation and retention in Michigan.In addition, the incentives package includes job training assistance valued at $450,000 for new employees at Kmart’s high-tech development center. This project will provide over $43.2 million in revenue to the state over the life of the agreement, resulting in a net positive gain for the state of over $27.2 million, after the MEGA credit.The project is expected to generate over $540.4 million in personal income during that time.Kmart Corporation is one of the world’s largest mass merchandise retailers.The corporation employs 4,072 people at its world headquarters in Troy. “Kmart will invest more than $2 billion during the next two years to create a state-of-the-art technology infrastructure that will make our company more efficient and competitive,” said ChuckConaway, chairman and CEO of Kmart Corporation.“We greatly value the vision, support and leadership of Governor Engler, the Michigan Economic Development Corporation, Oakland County and the City of Troy as we pool the strengths of the public and private sectors and leverage the power of technology.”The Michigan Economic Development Corporation works in partnership with local communities and Michigan businesses to retain and expand job opportunities and improve Michigan’s overall business climate.

Kmart CorporationMEGA AnalysisSummary Estimated(All estimates in 2000 dollars)









$ 27,281,000

Revenue Forgone

$ 15,957,000

Revenue Gain

$ 43,238,000

Average Wage

$ 1,154/week

Personal Income Generated Over Life of MEGA Agreement