A big idea that would transform 300 acres near Milan into a housing development for Chinese immigrants faces some major roadblocks.
A group of Chinese investors who bought property, presold housing units and began making plans to build a housing complex for other Chinese businesspeople said they are rethinking their plans after further researching U.S. immigration rules, an adviser to the group said last week.
Tongqing "Joe" Zhou of North-ville Township, an adviser to Sino Michigan Properties LLC, said, for now, "that project has been stopped."
Formed by mainland China businessmen, Sino Michigan Properties in recent months has acquired 300 acres in Milan Township and neighboring London Township, each of which border the city of Milan in northern Monroe County, adjacent to Washtenaw County.
The group planned to develop more than 400 housing units that would be sold to Chinese buyers, creating a concentration of Chinese immigrants on what is now mainly farmland.
According to warranty deeds filed with Monroe County, Sino Michigan Properties paid $1.9 million for the land.
But Zhou said the group has since discovered that the project wouldn't satisfy job-creation requirements of the U.S. government's Immigrant Investor Program, also known as EB-5.
The program is a way for foreign investors to obtain a green card and become conditional permanent residents of the U.S. Under the program, foreigners are required to invest a minimum of $1 million in an enterprise that creates or preserves at least 10 full-time jobs, or $500,000 if the enterprise is rural or in an area of low employment.
Under Sino Michigan Properties' plan, homebuyers would also have been investors in the project, and each housing unit would have needed to produce 10 permanent jobs in order to meet EB-5 requirements and ensure that the homeowners could continue to live in the U.S., Zhou said.
But the Chinese developers determined that each residential unit would not create that many permanent jobs, putting the homeowners at risk of losing their investment -- and of being deported, Zhou said.
"Right now, the bad news is it does not sound so good, so it's on hold," said Zhou, a Ford Motor Co. retiree who was born in China but became an American citizen after obtaining a master's degree in computer science at Wayne State University. He said he is an adviser to his friends who are Sino Michigan Properties investors. Sino includes three investors, but the names are not disclosed.
Zhou said the would-be developers didn't realize how stringent EB-5 requirements were when they started buying land. "Maybe some of the information they got was not very accurate," he said.
He said the group now is trying to determine what to do with the land.
Even though the original plans are in jeopardy, the investors still consider the land purchase a good investment because property in the U.S. is significantly cheaper than in China, Zhou said.
Sino Michigan Properties had more than 400 Chinese investors at the ready to buy houses, he said. Many Chinese are looking to emigrate to the U.S. because they want to experience American society, form businesses here or educate their children here, he said.
Linda Lim, a professor of strategy and an international business specialist in the Ross School of Business at the University of Michigan, said upwardly mobile Chinese are increasingly looking to move to the U.S., although she has not heard of similar Chinese-centric proposals elsewhere in the country.
However, Lim said she didn't doubt there would be interest in the project in China.
"It's nothing to get 400 people in China with $1 million in cash," she said.
Lim said Chinese immigrants are eyeing the U.S. because of its relatively cheap land, cleaner environment, political and social freedom, and less stressful lifestyle -- including in the education system, where there's far less competition than in China.
"They want their kids to have a relaxed childhood," she said.
Having Michigan residency also would boost the chances of getting into top colleges such as UM andMichigan State University, Lim said.
Arthur Dudley II, an attorney in the Detroit office of Butzel Long PC who is listed as the registered agent for Sino Michigan Properties on documents filed with the Michigan Department of Licensing and Regulatory Affairs, said he had "no comment at all" on the possible Milan-area development.
Milan-area officials say they have received only sketchy details about the possible development, but talk about the project has swirled around the community.
Milan Mayor Kym Muckler said she has been deluged with emails, many of them political in nature and critical of the project.
London Township Supervisor Barbara Henley said news of the idea caught her by surprise.
"Why Milan? What do they know that we don't know?" she said.
But area officials point out that no formal plans have been presented.
"People are trying to pick out the drapes, and we haven't designed the house yet," Muckler said.
Milan Township Supervisor Phil Heath said he also is waiting to hear more details.
"Nobody can say it's Company A, and this is what they're doing and this is what they want," Heath said.
Henley said she has not met with the Chinese developers, and the first step toward developing the property would be to file a site plan with the township planning commission. The project approval process would likely take months, she said.
Muckler said conceptual drawings of the project are circulating among Milan-area officials.
She said none of the land purchased for the possible project lies within Milan city limits. But the project would require city water and sewer services, which the city would extend under what are known as 425 Agreements. "The road to even negotiating one of those is a long one," she said.
Sino Michigan Properties representatives have discussed the project with Michigan Economic Development Corp. officials, but it's uncertain that the state would offer any financial assistance to the proposed development.
"We're not actively working on this project," MEDC spokesman Michael Shore said last week.
Heath said he is skeptical about the project because of the mysteriousness of it.
"I'm not sympathetic to the cause," he said.
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04/09/2013 postreply
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