Arbor Hills Crossing developer asking for 21-year tax break on redevelopment of 'obsolete' Washtenaw Avenue property
A map of the proposed Arbor Hills Crossing shopping center on Ann Arbor's east side, across the street from Whole Foods, at the corner of Platt and Washtenaw.
The city's Brownfield Review Committee will discuss the developer's brownfield plan — complete with tax-increment financing over a period of 21 years — for the Arbor Hills Crossing project when it meets today at 5:30 p.m. on the sixth floor of city hall.
A brownfield property is one in which site conditions present an obstacle to redevelopment. In Michigan, that can include properties that are contaminated, blighted or functionally obsolete.
Through tax-increment financing, no existing taxes are abated. However, the incremental increases in tax revenues that result from improvements to a property are channeled back to the developer to help cover costs and incentivize the development.
The eligible activities that the developer of Arbor Hills Crossing is asking for assistance on include environmental site assessments, preparation of the brownfield plan, public infrastructure improvements, lead and asbestos abatement, site preparation and other work.
A conceptual look at the Arbor Hills Crossing project.
Nearly $1.6 million of that would go to what's known as a Local Site Remediation Revolving Fund to pay for future remediation activities.
City Planner Jill Thacher, the city's historic preservation coordinator, said she expects there to be some revisions presented at tonight's meeting.
Brett Lenart, who oversees administration of the county's brownfield program, said he anticipates the LSRRF capture being reduced.
Ann Arbor real estate owner and developer Campus Realty is partnering with Chicago-based North Shore Properties Group on the project.
The 7.22-acre property the developer argues is eligible for assistance is situated on the south side of Washtenaw Avenue between Platt Road and South Huron Parkway. The developer proposes a contemporary multi-story retail and commercial development that requires demolition of existing structures and development of four new buildings.
The brownfield plan notes that a company called Fisca Oil operated a gas station on a portion of the property between 1971 and 1990. It also claims several hazardous substances, including lead and chromium, were detected in the soil and groundwater on the portion of the property where an auto dealership once stood up until recent years.
Construction is expected to begin by the end of this year.
In addition to walking and biking amenities, and a new bus stop, Arbor Hills Crossing would include some of the first electric vehicle recharging stations in Ann Arbor, according to the brownfield plan. The developer is not seeking tax credits from the state at this time.
The current taxable value upon which the TIF would be based is about $2.9 million. The plan estimates that would increase to about $9 million after redevelopment.
Ryan J. Stanton covers government and politics for AnnArbor.com. Reach him at ryanstanton@annarbor.com or 734-623-2529. You also can follow him on Twitter or subscribe to AnnArbor.com's e-mail newsletters.
Comments
mun
Tue, Jun 28, 2011 : 2:29 p.m.
With vacancies at Arborland, what makes you think that developing this property into retail will yield results? How do you know there won't be vacancies here too?
SemperFi
Tue, Jun 28, 2011 : 2:02 p.m.
The drawings look real nice, but enough of the namby pamby stuff. The developer will expect police and fire protection, well-maintained roads, working street lights & good traffic control. However, he doesn't want to pay for any of it. Good gig if you can find a sucker to swallow it.
Andy Piper
Tue, Jun 28, 2011 : 1:06 p.m.
I would rather see the development in the city of Ann Arbor. This site is perfect for high density retail and commercial development and it would be fine if there were some multi-family housing as well. This is as good of a location that exists in the city of Ann Arbor - it should be developed to its potential.
Adam Jaskiewicz
Wed, Jun 29, 2011 : 2:05 a.m.
Oh, I'd love to see it developed... and added to the tax rolls.
Terry Redding
Tue, Jun 28, 2011 : 9:02 a.m.
"City Planner Jill Thacher, the city's historic preservation coordinator, said she expects there to be some revisions presented at tonight's meeting." I had to do a double take when I read this. Not sure if Jill is just commenting about revisions in general or if this quote means that there might be some sort of "historic preservation" input to the sight? I said to myself WHAT????? Good grief, how many people have to pile on? Having lived here when the place was thriving the only thing I can think of that people might be trying to preserve is when the strip that's still standing housed a furniture store and they want to preserve their memories (it was last a dog business.) I say NO to tax breaks for this development. However, if we are going to make the developer bow down to an imaginary "historic" perspective on the vacant lot they deserve some sort of consideration for Ann Arbor's overreaching meddling...
Mike D.
Tue, Jun 28, 2011 : 11:22 a.m.
I read it the same way and had the same reaction at first, but I think she's saying that as a city planner, not specifically from the perspective of historic preservation. I'll chalk it up to Ryan being slightly unclear in his phrasing. But then again, crazier things have happened!
snapshot
Tue, Jun 28, 2011 : 6:12 a.m.
Hope city officials see the value in this project. The east side of Ann Arbor seems to be neglected and deteriorating rapidly. I wonder if some of the folks so opposed to tax credits work for the auto or auto support industry, the government, real estate, or banking industries that have been and are propped up with tax dollars. Maybe a "windfall" tax on these folks might be imposed upon those receipients instead of withholding tax credits for improvements in blighted areas of the city.
Basic Bob
Tue, Jun 28, 2011 : 4:56 a.m.
That is a hideous piece of property right at one of the main entrances to Ann Arbor. Then again, all the entrances have abandoned buildings and vacant contaminated land. Why should this be any different from South State, North Main, Jackson, or Plymouth? We wouldn't want people coming to Ann Arbor to actually be impressed or want to come and spend money, would we? That might actually improve property values and generate more tax revenue to support the local economy and schools. Better we turn it into a feral hog refuge.
John A2
Tue, Jun 28, 2011 : 4:20 a.m.
Why are we building new shopping centers when we have many not in use? That corner is plagued with them already. It's good that we are building, but are we being economically sound with our decisions? I say use the old shopping centers before we build new ones.
debling
Tue, Jun 28, 2011 : 3:19 a.m.
Ok you Republicans, it's time for you all to stand up and say "NO CORPORATE WELFARE"! Let the free market reign and let's end socializing of costs and privatizing of profits! The $7.9 million in tax breaks is $7.9 million you taxpayers will be paying out of your pockets.
David Paris
Tue, Jun 28, 2011 : 2:41 a.m.
Read my lips... No New Tax Breaks! Tax payers keep taking it in the chops, while businesses get off the hook. We need the tax revenue Now, and if they don't develop it, it won't go vacant for the 21 years that they want to skip out. Just say No!
belboz
Tue, Jun 28, 2011 : 1:53 a.m.
Then you shouldn't have bought the property, or let it become obsolete.... Ann Arbor certainly seems to be developing a reputation of approving wasteful use of taxpayer money. Ala... Zingerman's getting $1 million for a burnt house redevelopment. More of my beef can be thoroughly enjoyed at.... <a href="http://www.annarbor.com/community/community_wall/ann_arbor_isnt_overrated_-_but_its_getting_there/">http://www.annarbor.com/community/community_wall/ann_arbor_isnt_overrated_-_but_its_getting_there/</a> Ann Arbor Isn't Overrated, But Its Getting There....
a2susan
Tue, Jun 28, 2011 : 1:51 a.m.
I know that piece of property is an eyesore right now, but I hope it doesn't get developed. The traffic on that stretch of Washtenaw is just horrendous. Can you even imagine how bad it will be with a shopping center there? The traffic already gets backed up at the traffic lights, there's no more room for new traffic lights. The traffic also gets backed up with drivers coming to and from the university for work. I don't want my taxes paying for development in that location.
Old Salt
Tue, Jun 28, 2011 : 1:24 a.m.
Right you are and home owners also
scan
Tue, Jun 28, 2011 : 1:23 a.m.
What about all the other shopping complexes that are fast emptying? Arbor Land right up the road? hm. Empty buildings in 10 years.
dotdash
Tue, Jun 28, 2011 : 1:21 a.m.
I agree with Nemo. If the site doesn't warrant the developers or financiers taking on the risk, why should it be subsidized by taxpayers, who won't get a return on their investment? I guess they wouldn't be responsible businesspeople if they didn't try to squeeze every dollar out of every project and shift as much of the risk as they can, but that is no reason for elected officials to agree. I hope that if the taxpayers end up kicking in on every project where a gas station, dry cleaner or car dealership ever existed, that we get to stipulate no more of those on publicly-financed projects (just to save future taxpayers the same costs next time around).
xmo
Mon, Jun 27, 2011 : 10:43 p.m.
I guess the developer thinks that the taxes are too high. Maybe the city might consider a review of the taxes it imposes on businesses in Ann Arbor.
nemo
Mon, Jun 27, 2011 : 9:57 p.m.
No handouts: The site is worth it, or not. If so, you don't need my money, if not, walk away and let some other guy take a shot at it. Capitalism is about taking risks, not corporate welfare. Otherwise I want a 75% tax on your profits.
Roadman
Mon, Jun 27, 2011 : 9:17 p.m.
"The developer is not seeking tax credits from the state at this time." Why not? If the state wants to promote a better business climate, why expect local government to be providing all the tax incentives, especially when local tax revenues have declined greatly?
Maxwell
Tue, Jun 28, 2011 : 1:56 a.m.
I believe the key part of the phrase is "at this time".
Adam Jaskiewicz
Tue, Jun 28, 2011 : 1:15 a.m.
Why should the state give them any more of my tax dollars, especially after giving a $1.8 billion tax cut to businesses? Isn't that enough? Why should a business get a tax break above and beyond that? Shouldn't they have considered any potential conditions that "present an obstacle to redevelopment" when they decided how much to offer for the property?