From Raffle Winner To Businessman In Detroit

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Detroit is struggling, but one neighborhood in the southwest corner of the city is growing. Entrepreneurs —- many of them Hispanic — are opening shops and even small factories.

ROBERT SIEGEL, host:

There is no shortage of economic anxiety in Detroit these days: unemployment over 20 percent, declining population, a reeling auto industry. But one neighborhood apparently didn't get the message. It's actually growing. Southwest Detroit is home to a large Hispanic community and many other ethnic groups, as well. Local entrepreneurs and investors are trying to hold their own in neighborhood stores and small factories, including one built on the site of a long-closed Cadillac plant.

NPR's Don Gonyea reports.

DON GONYEA: Take Michigan Avenue west from downtown Detroit, go past the remains of the old Tiger Stadium, turn left on Clark Street and you're in the heart of Southwest Detroit. It's an area with its share of poverty and crime, but you also find small shopping centers and restaurants on corner after corner with customers. Our tour guide is Frank Venegas.

Mr. FRANK VENEGAS: And what's happened is entrepreneurial here in Mexicantown, it's pretty incredible because you'll see that most of the buildings don't have lease signs. There's lots of traffic, I mean, all the time and it's incredibly different.

GONYEA: Venegas is in his mid 50s. He was born here, the son and grandson of Ford assembly line workers. These days Venegas actually owns the factory on Clark Street.

(Soundbite of machinery)

GONYEA: This is a company called Ideal Shield where they make steel products. It's located on the very site where GM once assembled Cadillacs until the factory was shut down in 1987. Venegas started out with a stroke of luck. Back in 1979 he bought a $150 raffle ticket at a local charity dinner. The grand prize was a new Cadillac Coupe de Ville. He won the car, but sold it and invested the cash in his first business.

In the decades that followed, that raffle ticket became a $150-million-a-year operation. Venegas moved his business from the suburbs to his old neighborhood a few years ago. Among those he hires are former gang members and convicted felons.

Mr. DARREL PALM(ph): What I do, I'm the welder over here. What I do, I weld up everything. When I weld I need you guys to look that way because I don't want to blind you guys.

GONYEA: Okay.

As a young man, Darrel Palm spent nearly 10 years in prison on drug charges. He started working here 14 years ago. Today he's 41 years old, brags that his life is on track. He's got a family, a house. It's a non-union job, but he says he makes good money.

Mr. PALM: I've got benefits. I'm in a 401K. I mean, I've got the health care, I've got the Blue Cross, I've got the Aflac. I'm doing the whole nine yards.

GONYEA: Still, business is hurting. This shop floor on this day has only 14 workers on the job. That's down from 20. Venegas says one of his biggest operations, commercial construction, is down some 80 percent.

Mr. VENEGAS: I think that the number one question that everybody in America has is when is this going to end? Where is it going to finally bottom out at?

GONYEA: The one part of his business that's thriving, he calls it his graveyard business. He helps GM dismantle newly closed factories.

Mr. VENEGAS: Instead of hiring people to make things, I'm hiring people to take their stuff and get the maximum value out of it.

GONYEA: The parts are then sent to other GM plants that can use them or they're sold off. That the entrepreneur who revived an old Cadillac plant in his old Detroit neighborhood is now clearing out newly closed auto plants in towns where people can only hope that new development will follow, is a sign of just how tough things have gotten.

Don Gonyea, NPR News, Detroit.

SIEGEL: And Don is one of several correspondents reporting this week on the effort to retool Detroit's economy. That coverage continues tomorrow on MORNING EDITION. We'll meet a man who is buying rundown homes and a woman who finds value in Detroit's giant statue of a fist.

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