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Detroit's New Factory of Dreams

From our colleagues at Fortune, here's a story about Detroit's Russell Industrial Center and the old Packard car plant, two factories just down the road from each other. They have plenty in common. Except the Russell Center represents hope.

An excerpt:

FORTUNE -- This is a story of two Detroit factories, one a symbol of despair and the other of promise. On the one hand is the old Packard car plant on East Grand -- 3.5 million square feet on 38 desolate acres. Broken windows, crumbling bricks, creeping vines, and a FOR SALE sign that's been hanging there for years. "Most of the interest," realtor David Wax told us, "is to tear it down for the steel in the building."

On the other hand, just down the road, stands an icon of hope, a gargantuan factory complex, the Russell Industrial Center. It has the same lofty pedigree as the Packard plant (both were designed by Albert Kahn) and a similar vintage (it was built in the 1920s). As the former headquarters of Murray Corp., which made bodies for Ford in the glory days, this plant, too, is inhabited by ghosts. Here, however, the ghosts share quarters with some spirited company: a menagerie of glass blowers, cabinetmakers, architects, seamstresses, a sneaker designer, and three women who teach pole dancing, among others -- 160 small-business tenants in all, most of them operating on the frontlines of Detroit's burgeoning creative economy.

Their landlord is Dennis Kefallinos, 55, who immigrated from the Greek island of Zakynthos when he was 15, found a job as a dishwasher, and in all these years has never once stopped working long enough to learn how to read and write properly. Today, while he's best known around town as the owner of Niki's Pizza and a place called Bouzouki (which is, gulp, a strip club), he's one of the city's biggest real estate barons.

Kefallinos began buying "distressed properties, big structures," in the '90s, he says, thinking that "in 20 years Detroit is gonna be so hot. Isn't that crazy?" He bought the Russell Center in 2003 for $1.5 million. A bargain, except that most of its 2.2 million square feet were vacant, many of its windows had been blown out by a tornado, and it was losing $50,000 a month. Chris Mihailovich, the property manager, says he really didn't know what to do with the place. Until the artists started calling.

Read the full story here.

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