Ann Arbor DDA report shows rapid downtown growth with more to come
Major construction projects such as The Varsity have increased the population of downtown Ann Arbor by 56 percent since 2000.
Melanie Maxwell | AnnArbor.com
With Ann Arbor residents and elected officials engaged in a discussion over the future of the city’s downtown areas, the report focuses on changes in the district over the past decade and looks forward to future developments that will have significant impact on the city’s character.
According to the DDA, the population of downtown Ann Arbor increased by 56 percent since the 2000 census and 19.2 percent between 2010 and 2012. By comparison, Ann Arbor’s population grew by 1.9 percent and the state of Michigan’s population only increased by 0.1 percent over the three-year span.
“Despite new supply, the downtown housing market is tight,” the report said, noting that the price per square foot for residential real estate rose 12 percent in 2012.
“With low inventory available and a recent focus on constructing high-end student rental units, a significant opportunity for workforce housing remains. As more units are built, options for downtown living will continue to expand.”
According to the DDA report, 337 housing units are under construction in the downtown area with approximately 460 additional units proposed.
Any future residential housing developments will likely be subject to strict scrutiny from the planning commission and city council. Recent housing projects such as the City Place Apartments and the 413 E. Huron St. development have been highly contentious and the city is soliciting citizen participation in a review of the A2D2 zoning regulations adopted in 2009.
Ann Arbor's downtown area saw a number of new restaurants open in the past year, including Lena and What Crepe? More are expected in the coming year including a new Knight's Steakhouse concept on East Liberty Street.
Melanie Maxwell | AnnArbor.com
According to the report, downtown Ann Arbor’s job density is 65,033 jobs per square mile. By comparison, a recentstudy of greater downtown Detroit found a job density of just 18,805 jobs per square mile in the 7.2 mile area incorporating the central business district, midtown and the surrounding neighborhoods.
Restaurants occupy 11.6 percent of downtown commercial real estate, while retail and wholesale stores draw approximately even at 13.2 percent.
Nearly one third of downtown’s commercial space is taken by offices, many of which house the 14,212 employees of the University of Michigan, by far the area’s largest employer. A number of office spaces not snapped up by the university have been taken by the 185 information technology companies that employ 2,400 workers in the area.
Led by Google and Barracuda Networks, which combine for approximately 500 employees, other companies such as PRIME Research, the Inovo Group, DeepField and Camis have signed leases to join the “tech hub” along East Liberty Street in the past year.
With the addition of the DDA-sponsored underground parking lot at Library Lane, downtown employees and visitors have a total of 8,249 public parking spaces to choose from. With parking at a premium, the Ann Arbor Transit Authority set a single-year ridership record in 2012 with more than 6.3 million rides.
Nearly 10 percent of those rides were completed using the go!pass, an unlimited use transit pass sponsored by the DDA and available to all downtown employees.
The report closes with an eye toward the coming year, which is expected to include the opening of Ann Arbor City Apartments and The Varsity housing complexes as well as a number of new restaurants including The Lunch Room, a new Knight’s Steakhouse and Slurping Turtle.
The Downtown Development Authority is a city agency with the stated mission of strengthening the downtown area and attracting new private investments. The authority consists of a twelve-member volunteer board nominated by the mayor and a four-person staff. The DDA is funded by a combination of tax increment funding and public parking revenues from the downtown area.
Ben Freed covers business for AnnArbor.com. You can sign up here to receive Business Review updates every week. Get in touch with Ben at 734-623-2528 or email him at benfreed@annarbor.com. Follow him on twitter @BFreedinA2
Comments
Roger Kuhlman
Thu, Aug 15, 2013 : 2:11 a.m.
Ann Arbor and the surrounding Washtenaw County does not need anymore residential, commercial, or institutional development. In fact as things now stand we have too many people and development for long-term ecological sustainability and our natural habitats, native ecosystems and biodiversity have been hit hard by existing development. Wanting more means you do not value natural environments and any environmental claims or postures you make are really just hollow, deceptive nonsense.
townie54
Wed, Aug 14, 2013 : 2:21 a.m.
not at those prices,today.if it was like in the 70's when you could afford to live above businesses then yes
Steve Bean
Tue, Aug 13, 2013 : 5:09 p.m.
An earlier commenter raised a valid concern about air quality. The report could have included data on air quality (as well as noise pollution) in the "Quality of Life and Accessibility" section. In general – and in spite of greenwashing the underground parking structure project – the DDA's undiscerning mission ("strengthening"… "attracting") conflicts with the city's environmental goals. In particular, downtown economic development continues to rely on the combustion of fossil fuels, which is responsible for the poor showing of the city in the "Stable Climate" category shown here: http://bit.ly/147TtCP. (For broader climate impact context, see here: http://bit.ly/Sdrodk.)
paul wiener
Tue, Aug 13, 2013 : 3:58 p.m.
A true "downtown" has social spaces, a mix of all kinds of people, and a rush of people 7 days a week, not two, little pocket - or larger - parks, no bicycles on sidewalks and theatre venues. A2 has none of this and never will. It has Main Street, overpriced and overhyped restaurants, nonstop self-promotion, no integration with student or university life, and endless construction. The best things there - like Le Dog - are invisible from Main Street and rarely open. People who think A2 has a downtown have probably never been to a real one.
mr_annarbor
Tue, Aug 13, 2013 : 5:54 p.m.
What the heck are you talking about? There are plenty of people downtown seven days a week. We have the Michigan Theater, the State Theater, Performance Network, and all the performances at Hill Auditorium. No, you can't compare it to Chicago or New York or San Francisco, but for a town of just more than 100,000, it's a pretty good downtown.
Brad
Tue, Aug 13, 2013 : 1:35 p.m.
Here's another question: how much of the increase in downtown population is from students vs. non-students? Let's also remember that we paid Barracuda to move into the DDA zone.
Ben Freed
Tue, Aug 13, 2013 : 1:44 p.m.
That's a very good question Brad. McKinley CEO Albert Berriz told Lizzy Alfs in a previous story that the student high-rise housing boom was driven by developers who believed that the returns are higher on student building and that they are a much safer bet. I do not have exact numbers on how much of the increase in population is students but it is certainly a significant proportion.
Veracity
Tue, Aug 13, 2013 : 1:23 p.m.
The DDA struggles to balance its budget each year and has wasted tax dollars to pay for an overly expensive subterranean library parking structure and for the mostly private Village Green Ann Arbor City Apartment parking facility. It has given tax dollars away to developers by returning TIF to pay for Brownfield remediation and site development and it has provided grants to favored private businesses. In order to obtain more TIF revenue the DDA is pushing hard to have large highrise buildings constructed on the four remaining publicly owned properties downtown which do not presently have buildings (The Connect William Street Plan). These buildings will be entirely speculative since no member on City Council or the DDA knows who or what will occupy each new building. If development failure does not seem possible then please review the ownership history of the Ashley-Terrace, 4-eleven lofts and Woodland Mews. http://www.annarbor.com/business-review/rebranding-ashley-terrace-new-owners-hope-to-fill-empty-retail-and-office-space-in-2012/ New residential construction aimed at "young professionals," "young families" and "empty nesters" can be expected to have pricey rentals, likely in the range of $1,800 to $2,750 per month. If 30% of one's income should be spent on housing these prices demand renter salaries ranging from $72,000 to $110,000. Many potential renters will be priced out of the market. "Affordable housing" is too costly to build downtown. The few units in the Village Green building set aside for such use will be heavily subsidized by.... the DDA and your tax dollars! The DDA was created decades ago to counter the blight developing downtown when merchants and shoppers fled to the then new Briarwood Mall and Arborland shopping centers offering large box retailers and plenty of free parking. Over the years downtown Ann Arbor has had a resurgence that is essentially complete. The DDA and its unrestricted spending of tax dollars
Veracity
Tue, Aug 13, 2013 : 1:27 p.m.
... is no longer needed. (to complete the sentence left dangling at the end of my comment)
Eduard Copely
Tue, Aug 13, 2013 : 11:35 a.m.
The DDA report is wonderful fiction.
EcoRonE
Tue, Aug 13, 2013 : 12:20 p.m.
What non-fictional measures do you propose instead?
A2comments
Tue, Aug 13, 2013 : 10:57 a.m.
I wouldn't live in ANY downtown. I like quiet, like my windows open, year the birds chirping, etc. Not a dig against A2, but the way survey is designed it could appear to be.
PineyWoodsGuy
Tue, Aug 13, 2013 : 5:11 a.m.
I would not live Downtown. I apply the "Stink Test." 1. Disgusting automobile exhaust and 2. The aroma from the restaurants (many of them Very Spicy. Excuse me if this is not Politically Correct).
Roger Kuhlman
Thu, Aug 15, 2013 : 2:20 a.m.
Shouldn't the left-wing thought police be on hand to complain about the probable ethnic or racial slur of aromas from Very Spicy restaurants?
Indymama
Tue, Aug 13, 2013 : 5:24 p.m.
You don't need to be excused PineyWoodsGuy. Your Stink Test DOES affect the Downtown here. Those people who like the ugly smells and gas exhaust are not true Ann Arborites...they have migrated here from such places like Chicago & NY City, etc. They really don't belong in Ann Arbor, but it looks as if we may be "stuck" with them!!
PersonX
Tue, Aug 13, 2013 : 3:30 a.m.
Downtown and the near downtown are getting worse not because of development as such, but because of bad development. Developers are building things without the slightest sense of context and so we now have such visual blight as City Place and the Varsity, not to mention the coming horror on Huron that Council could have stopped, or at least curtailed. These developments did not have to be so ugly and misplaced, but developers who care only about the bottom line and Mr Highrise and his allies have made Ann Arbor uglier and downtown less pleasant. No one listens to the residents who opposed all of these in their present configurations, but many of the same people praised and supported the plans for the new Kerrytown development, because it is a good one. Most us us who live downtown are not against change and progress, only against change that is for the worse. Stop the visual pollution, and please vote out the rest of the Highrise allies next year.
Veracity
Tue, Aug 13, 2013 : 1:47 p.m.
To start with let us hope that the zoning ordinance will be changed to reflect the concerns of many residents of Ann Arbor. The process is underway and all citizens are encouraged to participate. Meeting schedules can be found at the city's website and in annarbor.com articles. http://www.annarbor.com/news/ann-arbor-downtown-zoning-review-rethinking-incentives-offered-to-developers/ Some meetings are scheduled for tonight: Planning Commission Work Session/Committee Meetings Tuesday, August 13, 2013: 7:00 pm: CPC Working Session: Discussion regarding Sale of Former Y Site (Council workroom) 8:00 pm – Master Plan Review Committee: Review of Non-Motorized Plan Update (Council workroom) 8:00 pm – Ordinance Revisions Committee: Review of Downtown Zoning Evaluation Project (Basement level conference room) In addition, a R4C/R4A Revisions Meeting is scheduled at 7 PM tomorrow (August 14, 2013) at 301 E. Huron Street in the basement conference room.
The Eyes of Justice Team
Tue, Aug 13, 2013 : 2:27 a.m.
These numbers are a joke. The Mayor is trying to change the public image of himself and the DDA.
JBK
Tue, Aug 13, 2013 : 2:11 a.m.
YOU ARE KIDDING, RIGHT? Led by Google and Barracuda Networks, which combine for approximately 500 employees, other companies such as PRIME Research, the Inovo Group, DeepField and Camis have signed leases to join the "tech hub" along East Liberty Street in the past year. A tech hub? I guess the call centers at Google count. A2 is NOT a tech City. Get over it. This town will never be a tech city. ProQuest and Truven emply almost 3000 'tech' positions. Quantitatvie Stats, heavy math, etc.......... What a joke this article is. Ann Arbor is NOT tech. Now if you want to talk about coffee shops and pedicures,.......then that is a whole nother discussion.:)
mr_annarbor
Tue, Aug 13, 2013 : 5:49 p.m.
C'mon, Ben. Asking these people to actually show up for events like the one you mention would be way too hard for the complainers. I do think calling the jobs at Google "tech" jobs might be a stretch, though. Barracuda is unquestionably tech, however.
Ben Freed
Tue, Aug 13, 2013 : 1:25 p.m.
JBK, I encourage you to come out to the A2NewTech meet ups and events like Beer Thirty at the Tech Brewery. Ann Arbor may never have the scale of some tech centers (i.e. silicon valley) but there is certainly a significant "tech" presence in our city.
Brad
Tue, Aug 13, 2013 : 1:14 p.m.
They do love to beat the "tech hub" drum, don't they?
Eduard Copely
Tue, Aug 13, 2013 : 11:36 a.m.
Amen
Steve Bean
Tue, Aug 13, 2013 : 2:05 a.m.
"Welcome to our third edition of the State of the Downtown report, an objective look at some of the factors that contribute to downtown Ann Arbor's vitality and quality of life." It's not quite objective. The transportation costs numbers comparing downtown with the broader region don't adjust for household size, for example. The slant is very toward the positive, of which there is much to report. An objective report would also include business closings, as well as absolute quantities along with the percentages, among other things. Some of the comparisons with the rest of the city (e.g., job density, walk scores) might give critics like council member Steve Kunselman something to point to with regard to relative revenue spending in the city. That said, I continue to enjoy the downtown and am happy for everyone else who can as well. Thanks to all those who make it what it is.
Brad
Tue, Aug 13, 2013 : 2:01 p.m.
Totally agree, Steve -- the "rising tide" is a major factor. I don't blame the DDA for trying to take credit, but I do blame those on council who seem to be falling for the charade.
Steve Bean
Tue, Aug 13, 2013 : 1:45 p.m.
The success of the downtown is mostly a reflection of the broader economic trends in the country, which follow the movements in the stock market (which in turn is the most immediate reflection of social mood, i.e., optimism vs. pessimism). The DDA's role is largely facilitating what arguably would otherwise have happened anyway during a rising market and positive economic trend, along with cheerleading (see the "report"). But then that's their mission, after all. Assigning (or taking) credit is a tricky matter, though.
Brad
Tue, Aug 13, 2013 : 1:16 p.m.
Let's not forget that almost half the jobs in the DDA district are university jobs. How much credit are you going to give the DDA for those? Should we spend more DDA dollars there because of those jobs? I don't think so.
EcoRonE
Tue, Aug 13, 2013 : 12:16 p.m.
Finally, a sane and calm assessment of the report. Perhaps Kunselman could create a similar report about the state of the 3rd ward for comparison's sake. The downtown is so much more improved since the DDA was formed. Its work should be lauded at the same time adjustments are made to its revenue formula. Compliment, suggest an improvement, encourage.
a2grateful
Mon, Aug 12, 2013 : 10:59 p.m.
Oh, yes, and don't forget that the DDA incubated and hatched U of M (and then the internet, much to the chagrin of and lore of Al Gore) . . . The DDA is "udderly nurturisitic fabulouso," as they will be the first to attest. . . It is another of you-know-who's self-aggrandizement machines. When liars figure, figures lie. Beware of DDA assessments, both yours (tax) and theirs.
newsboy
Mon, Aug 12, 2013 : 10:53 p.m.
Build bigger, build it taller, build it better! Grow or die; but keep it Ann Arbor not UofM!
EcoRonE
Tue, Aug 13, 2013 : 12:04 p.m.
I would add, keep it out of Pittsfield - and make a ring of high density zoning around the UM.
B2Pilot
Mon, Aug 12, 2013 : 10:04 p.m.
65,000 jobs per square mile vs. Detroit's 18k per sq. mile? Really? do these numbers seem unreal or is it just me? Do those numbers include university employees & student employees ? seems like a poor comparison seeing the city has just over 100k residents.
B2Pilot
Tue, Aug 13, 2013 : 1:58 a.m.
So they are including University positions ?
David Frye
Tue, Aug 13, 2013 : 12:24 a.m.
The DDA report doesn't give exact figures, but working backwards from what it does present, it looks like the DDA area has 27,300 jobs (or as they say, "nearly 30,000") and the rest of Ann Arbor has 78,600, for a total of 105,900 in all of Ann Arbor. It makes sense. A lot of people who work in Ann Arbor, including for example many of the people in staff positions at U-M, live in surrounding communities where the rent is less expensive.
Brad
Mon, Aug 12, 2013 : 11:12 p.m.
But it also says that 26% of the city's jobs are in the DDA zone which would extrapolate to like 120K jobs here??
Brad
Mon, Aug 12, 2013 : 10:53 p.m.
The DDA district is .42 square miles, so 30K jobs in that area would be in that vicinity. Of that 30K almost half (14,212 per Ben Freed) work at the university.
Colorado Sun
Mon, Aug 12, 2013 : 8:42 p.m.
I luuuuuuv DDA executive director Susan Pollay - but I do not agree with this report. The 413 East Huron debacle is what ruined the political fortunes of 14-year incumbent Marcia Higgins - and helped save Steve Kunselman from a well-financed opponent in the Democratic primary last week. Anyone who was at the 413 East Huron project approval vote before the City Council saw dozens and dozens of ordinary citizens jeer and boo City Council members who voted for this monstrosity. Armed police were present for audience control. Jack Eaton, a staunch opponent of the 413 East Huron development, was mobbed by citizens outside City council chambers asking to volunteer for his campaign for Fourth Ward City Council Democratic seat then held by Marcia Higgins. Most citizens welcomed the retirement of Leah Gunn and revel in the arrest and resignation of Nader Nassif from the DDA board. The DDA has been operated for the benefit of political insiders and well-connected business owners at the expense of taxpayers. It is a good idea that in practice is a joke. The Downtown Area Citizens Advisory Committee has been chaired by political insider Ray Detter for 31 years. Detter had negligently allowed all CAC seats to expire as of October of 2012 until a citizen filed a FOIA request and discovered this fact in May of 2013. The CAC does not look out for citizens but is quintessentially a rubber-stamp for the Mayor. Ask Steve Kunselman and Sumi Kailasapathy their opinions of the DDA and you will realize that abuses are occuring that they are trying to correct. Ann Arborites need to contact their City Council representatives to express their support for their proposed ordinances to rein in the DDA. Marcia Higgins' 35% vote total was a wake-up call to allies John Hieftje and Steve Postema to heed the wishes of the electorate. No one bought the garbage that they were acting on Postema's sagacious legal opinion to approve the project. Vote against Postema for circuit judge in 2014!
The Eyes of Justice Team
Tue, Aug 13, 2013 : 5:50 p.m.
We have organized a Anti-Postema for judge blog......Look for details coming soon.....We the People of Ann Arbor need to move forward.....Postema as Judge would be a huge mistake!
Veracity
Tue, Aug 13, 2013 : 2:06 p.m.
EcoRonE - During one of the public comment sessions when the 413 E. Huron St project was being considered 15 local residents broke down Chapter 5 (if I recollect correctly) of the zoning code and showed that the developer was not compliant with many secondary zoning requirements. The litany was impressive and I thought that grounds were well established for legal action to prevent construction (though I am not a lawyer). Of course, this presentation was prior to a closed door meeting between City Council members and the city attorney with the subsequent decision to approve the project. Brad - As far as I know Postema has never submitted a recommendation to the City Clerk's office for dissemination to the general public. In fact, City Council members are sworn to secrecy and so can not discuss any of Postema's opinions.
Brad
Tue, Aug 13, 2013 : 1:44 p.m.
Where IS Postema's recommendation? Has anyone outside council seen it?
M-Wolverine
Tue, Aug 13, 2013 : 1:27 p.m.
EcoRonE, I think anyone who asks for someone else's credentials needs to put out what his or her's are first, and your background and employment, so we know whose pocket you're in. Fair's fair. Or are you not qualified to comment on the situation also?
EcoRonE
Tue, Aug 13, 2013 : 12:02 p.m.
413 was located in the original downtown zoning district, next to one of the tallest buildings in AA at the time. The owner of the property argued against down zoning as a taking immediately after the supreme court ruling on that matter. "Voters" do not have a right to tell owners how they can use their property and to base your view of a city council person on this one issue is the height of narrow-mindedness. What are your credentials to criticize Postema's recommendation? Where is your case law argument to support your position and demonstrate Postema was wrong and the city (taxpayers) would not have incurred court costs to fight the owner in court? Claiming garbage doesn't make it so.
The Eyes of Justice Team
Tue, Aug 13, 2013 : 5:50 a.m.
Postema needs to move on......he has milked the tax payers for years.
An Arborigine
Mon, Aug 12, 2013 : 8:14 p.m.
All seems rosie thanks to the DDA, or so this "justify our existence" report would lead you to believe.
EcoRonE
Tue, Aug 13, 2013 : 11:53 a.m.
All seems dark and sinister to the anti-DDA forces (Kunselman, Easton, Kailaspathy and their supporters) or so their many undocumented accusations would lead you to believe...
Brad
Mon, Aug 12, 2013 : 8:05 p.m.
Does that "30,000 working the district" include UM/UMHS employees?
Brad
Mon, Aug 12, 2013 : 8:11 p.m.
Thanks.
Ben Freed
Mon, Aug 12, 2013 : 8:10 p.m.
The 30,000 working in the district does include UM employees (14,212 to be exact) but the hospital system falls outside the DDA area as you can see here: http://www.a2dda.org/wp-content/uploads/business/2.2.2DDAStreetMap.pdf so it is unlikely that very many UMHS employees are included.
Anonymice
Mon, Aug 12, 2013 : 8 p.m.
The town would benefit from more residential space downtown. Unfortunately, "strict scrutiny" means more high-rises so many people hate, not fewer. Nobody's going to go through the hassle of the permit process for a modest townhome development.
Tom Whitaker
Tue, Aug 13, 2013 : 6:27 p.m.
There was a lot more to the City Place story than was made public, but one thing that was clear in the end was that the players with the money were only interested in the student project. It's simply not accurate to say that City Place only happened in its ultimate form because a large segment of the Ann Arbor population wanted to preserve the houses and the traditional neighborhood feel. A project that preserved the houses, provided underground parking, and additional new construction in the rear could have been built within historic district guidelines had there been any interest from the moneyed partners, but there was not. The historic district was not a popular idea with many neighbors either, but was pursued as a last resort. It was defeated by those on Council who voted against it: Christopher Taylor, Marcia Higgins, Margie Teall, Tony Derezinski, Stephen Rapundalo, and Sandi Smith. You might note that three of them have since been voted off of Council, and one chose not to run again. On the subject of Anonymice's comment, I don't know about townhomes, but there are at least three current downtown projects of a much smaller scale that appear headed for quick approval (in fact, one was already approved). Zaragon West, a high-rise project, also sailed through. Small, medium or large, a well-designed project that respects its context will find the approval skids well-greased. This has been shown again and again. It's the badly conceived and designed projects that have difficulty.
EcoRonE
Tue, Aug 13, 2013 : 11:49 a.m.
Modest townhomes are inappropriate for downtown and many developers will tell you they don't market well. City place (outside downtown in r4c where townhomes are appropriate) went through three site plans (maybe more) before they settled on the student housing design as a by ordinance plan. I much preferred the second proposal which was targeted for young professionals with underground parking and geothermal heat. People's nostalgia for old buildings clouded their judegement so that you got city place instead. (Old does not equal Historic)
Anonymice
Mon, Aug 12, 2013 : 8:06 p.m.
It is just a theory, of course, by somebody typing on the Internet. I think there's a market for something between a single-family house and a condo/rental downtown, but whether developers can make money will depend on how much space they are required by the city to give to setbacks, surface parking, etc. and how much they can use for actual housing.
Ben Freed
Mon, Aug 12, 2013 : 8:03 p.m.
Interesting theory. Do you think residents or developers would be willing to pay the cost of building modest town homes regardless of permit process?