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With 100% of precincts reporting, the vote count showed Duggan leading 55% to 45%.
Duggan would become Detroit's first white mayor since Roman Gribbs, who left office in 1974. Detroit's population is 83% African-American, according to 2012 U.S. Census estimates.
Duggan congratulated his opponent, popular lawman Benny Napoleon, "for his lifetime of commitment to the city of Detroit."
"When I started on this campaign, I was not under any illusion about the racial division in this country," Duggan said, "and I said from the beginning that the only way I could get past it was to sit with you … and get to know you one by one."
"At this moment what we have in common is much more powerful than what divides us. And now the real work begins," Duggan said.
He pledged to forge a constructive relationship with state-appointed emergency manager Kevyn Orr, Gov. Rick Snyder and new and re-elected members of the Detroit City Council.
Napoleon said he was disappointed he did not prevail, but he vowed to keep fighting for Detroit and its residents.
"This is not over," Napoleon said. "You will see me again."
Detroit political analysts said Duggan's message about his turnaround skills, including rescuing the Detroit Medical Center from near-bankruptcy a decade ago, caught on in a city that's facing a financial disaster of its own, fighting for survival in bankruptcy court, with residents exasperated by high taxes, poor public services, blight, unemployment and crime.
"His message of change resonated across racial lines, much the same as President Barack Obama did," political consultant Steve Hood said.
Despite Orr asserting control of city government, those who went to the polls Tuesday said they did so in hopes that the next mayor would help turn the city's fortunes around.
Bo Hanson, 28, voted for Napoleon, saying: "He's a man for the people. He's for us. He's going to make a change."
Others like Andre Moore, 41, cast their ballots for Duggan because of what he did at the Detroit Medical Center.
Napoleon "is more a police officer, and that's not what Detroit needs — black, white, purple, whatever," Moore said. "The city's in financial ruin. You need a person with business sense to come in and fix it."
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