Reflections from the Board Chair
Hug Your City Today | February 23, 2011
Budget proposals coming out of Lansing recently make a couple of things very clear: 1) Cities in Michigan will have trouble providing anything but very basic services over the coming years and 2) Cities are not a priority for Michigan’s current government. For a governor who campaigned on a platform that he would create a better business climate, punishing Michigan’s cities just seems wrong-headed.
If Michigan is truly committed to diversifying its economy and encouraging new business development it needs to support its cities because this is where Michigan’s future opportunities lie. A new book, reviewed in a New York Times book review, tells why. Economist Edward Glaeser, in his book Triumph of the City, How Our Greatest Invention Makes Us Richer, Smarter, Greener, Healthier, and Happier, talks about “the urban ability to create collaborative brilliance.” His theory, supported by a lot of historical examples, is that cities bring people together, and it’s only when many people are bouncing their ideas off one another that inspiration occurs.
In contrast to the volumes we read lately on social media and how everyone connects with everyone else by sitting behind a computer screen, Glaeser’s book champions actual relationships: “Cities are the absence of physical space between people and companies. They are proximity, density, closeness. They enable us to work and play together, and their success depends on the demand for physical connection.”
That people-to-people connection is what makes Ann Arbor’s Downtown so attractive to businesses. If you’re working Downtown, you don’t have to hop in a car, you can head down the street to find interesting short seminars at LA2M or coworking space and conversation at The Workantile Exchange. If you want a diversion from work, you can meet some friends for dinner at any of the dozens of restaurants and then see a play, concert or movie at Performance Network, University Musical Society, or The Michigan Theater.
The DDA’s mission is to provide the framework for the creative endeavors of Ann Arbor’s Downtown community and to work to bring more people and more businesses Downtown. That’s part of the city government’s mission, too, but economic realities are pushing that mission lower and lower on the list of budget priorities. It remains to the DDA, which doesn’t have the constraint of having to provide basic services, to fulfill the economic development function that will ultimately improve the city and its financial security.
Both the city and the DDA are going through the very scary process of budgeting for the next couple of years. A percentage of parking revenues, managed by the DDA, will help the city maintain basic services temporarily, but now is not the time to skimp on the “development” part of the Downtown Development Authority role. The DDA will continue to promote “our greatest invention.” But the State is an essential partner, and we can only succeed if priorities in Lansing are aligned with its cities.
Downtown Ann Arbor Scores Again | January 6, 2011
Most of the talk on the street these days is about the hiring and firing of football coaches, but other news shows that Downtown Ann Arbor scores again. The vacancy rate for downtown office space is dropping, according to numbers collected by Swisher Commercial and reported in ann arbor.com. Companies want to be downtown. One of the country’s fastest growing tech businesses, MyBuys, has expanded its Ann Arbor staff and will be moving into the office space on Liberty that used to house FedEx/Kinko’s, which didn’t leave downtown but moved across the street.
Last night (January 5), I joined a couple of dozen other interested downtown residents and others who gathered at the Downtown Library to listen to a presentation about a new hotel proposed for the corner of Willliam and Division, across from Google, 411 Lofts, and the Michigan Credit Union (formerly the Ann Arbor News building). This 104-room hotel will have an outdoor plaza, valet parking, and other hotel amenities that business travelers seek. The exciting part is that the Chicago company planning to build and manage the hotel, First Hospitality Group, is already in the Ann Arbor market and is bullish about the downtown. They own and manage the Hampton Inn on Green Road, outside of the DDA, and know that their customers want to be downtown so they can be close to restaurants, theaters, retail shops, and the University.
The proposed hotel will be one of the first new building projects since implementation of the ambitious A2D2 zoning revisions. Streamlining the development process, so that Ann Arbor can reap the benefit of property taxes, construction and hotel jobs, and more visitors contributing to the livelihood of the downtown, is another good sign that Ann Arbor continues to lead in optimism about Michigan’s economy.
Things are Looking Up | December 6, 2010
Among all the dire stories about the Michigan economy, there are a few bright spots. An article in the New York Times pointed out that Michigan and Ohio have become major manufacturing centers for solar power equipment. According to the MEDC, “Michigan has leveraged the 2009 federal stimulus bill and an array of state manufacturing incentives, tax credits and other public aid to produce $4.1 billion in public and private investment in the state’s solar manufacturing industry in the last three years.”
Here in Ann Arbor, where we don’t do much manufacturing, we tend to gloss over these kinds of stories. Maybe that means more factory jobs, but what does it mean for us? It means that we have to be ready to take advantage of a Michigan renaissance, and especially the renewal of southeastern Michigan for jobs and industry relating to clean energy.
Clean energy manufacturing doesn’t just bring factory jobs. This industry needs scientists, administrators, marketers, advertisers, and planners. These are people who want the quality of life that a city like Ann Arbor has to offer. The DDA is primed to move into the next phase of Michigan development. Our mission has been to prepare the downtown infrastructure for things to come and people walking around the downtown can see that in action.
The DDA’s biggest project is the underground parking garage on South Fifth Avenue. We are now working with the city to study the feasibility of a downtown mixed-use hotel and conference center on top of the underground garage. Professionals, like those involved in the clean energy business, need places to meet, and those are currently hard to find in Ann Arbor. Even University of Michigan groups can’t find conference locations within the UM system. People involved in medical and other sciences are jumping at the chance to bring their colleagues to meet in Ann Arbor.
A lively downtown can be one of the top attractions for businesses that want to locate in this area. It’s not just the tax incentives and other perks mentioned in the Times article that can bring businesses here. It’s us – we’re the heart of the city.
After a Retreat, a Step Forward | September 27, 2010
Reading a recent column by New York Times columnist Thomas Friedman made me think about downtown Ann Arbor. Friedman was in Tianjin, China, and admired a gigantic, new conference center there that was built in only 9 months. In the column, he was wondering why Americans can’t seem to get this kind of infrastructure built – in a democratic manner – the way the Chinese seem to be able to do.
The idea of fast-tracking needed business development hit home because the DDA board has just finished a half-day retreat where we focused on what we want to achieve in partnership with the Ann Arbor City Council. Other cities in Michigan seem to be making greater strides than we are. For example, Battle Creek has had $20 million in construction activity this year, according to an article in the Business Review West-Michigan. Their business development is led by Battle Creek Unlimited, a private, non-profit corporation that developed a Downtown Transformation Plan two years ago. BCU President Karl Dehn made some statements in the article that fit exactly with what we discussed in our DDA retreat: “In infrastructure, you can’t have a build-it-and-they-will-come mentality,” Dehn said. “Having an attractive setting is part of it, but there has to be a reason for people to be here. Economic development strategy really has to lead this.”
City Council and the DDA are really on the same page. We both know that we have to have significant development downtown to bolster our tax base and bring in jobs so that more people can live and work downtown. What we discussed at the retreat was how the DDA can manage both the economic and structural development to make this happen. One important task that the DDA can begin with is a micro/master plan of unbuilt downtown parcels. I call it micro/master planning because up until now Ann Arbor has had master planning at a more abstract level, through the Calthorpe-run public process that led to the A2D2 re-zoning of the downtown. The Calthorpe and A2D2 planning processes did not seek or make site-specific recommendations. We are now at the point where we need to get to the micro level and plan what we want our downtown to look like with the empty lots that are available, many of which are now only being used for parking.
This kind of planning can’t take place without having a vision for economic development as well. Karl Dehn is so right about having an economic strategy that creates a reason for people to be attracted to the downtown. That is why the micro/master planning has to include not only urban planners but also experts in commercial real estate and business. All the resources are here, with the DDA, the University of Michigan, and SPARK. Over the next few months, we will be working to create a framework for our vision, through a new DDA committee and on-going discussions in the joint Mutually Beneficial Committee (DDA members + City Council Members and City staff).
It is easy to argue that a town like Battle Creek, with the giant cereal manufacturer Kellogg’s, has built-in economic development it can count on. That may be true, but a world-class city like Ann Arbor should also be able to attract world-class business. We can’t wait to have those businesses come to us. We have to make plans – now – to seek and welcome them.
Parking that's Just Right | September 1, 2010
Nothing gets people riled up like parking. Think of the times you’ve really lost it recently. Was it when you had that extra cappuccino, were late to your meter and got a ticket? Was it when you had to tailgate that person driving really slowly around and around the parking garage? Maybe it was when you saw the perfect parking spot in front of your favorite restaurant, made a U-turn to get it and ran right into another car.
At the DDA, we hear complaints about parking all the time. Some people claim they can never find a spot downtown. Others say they see way too many parking places and why are we spending so much money on parking anyway? Remembering the story of the Three Bears might help to figure it out.
Donald Shoup is the guru of smart city parking. An economist and urban planner, the UCLA professor espouses what he calls the “Goldilocks principle”: If too many curbside parking spots are empty, the price is too high. If there are no parking places, the price is too low. About 85% occupancy is just right because drivers can see that there is some availability and won’t be scared away. The best practice is to manipulate prices by charging more for high-demand spots and times, called “performance-based” pricing.
In Downtown Ann Arbor, the meter time is limited so cars can’t monopolize spots all day. But in Redwood City, California, which implemented performance-based pricing, they removed the limits because the pricing, which changes at different times of day, took care of the problem. Those who want to pay a lot can stay all day, but most people are pretty frugal with parking money and most long-term parkers park in cheaper, off-street parking. As we move towards replacing all meters with ePark machines, performance-based pricing will be easy.
Shoup recommends parking districts, where parking meter money goes to fund street and sidewalk improvements. Ann Arbor was ahead of its time when the city turned parking management over to the DDA instead of simply having all parking funds go into the city’s general fund. The DDA can use parking money to maintain parking garages and fund street improvements like the Fifth and Division changes that are winding up right now.
Of course, street meters look more like a cash cow than a Papa Bear, so ideas are often floated about to place more of them in more places. Instead of literally nickeling and diming drivers in particular locations, the City Council asked the DDA to come up with a comprehensive parking plan to address the ebb and flow of parking, along with the ebb and flow of funding. That plan can be found at this link: http://www.a2dda.org/current_projects/public_parking_plan/ Through smart management, including performance-based pricing, we think we’ll reduce hot tempers over parking issues and have more Ann Arbor downtown visitors feeling just right.
DDA Board Chair, Joan Lowenstein, became a committed member of the DDA Board in 2007 and a downtown advocate many years before that. She is an attorney at Jaffe Raitt Heuer & Weiss, located in the First National Building in downtown Ann Arbor. Joan has worked in downtown Ann Arbor since 1986, practicing intellectual property law and teaching communication law at the University of Michigan. Ms. Lowenstein served on City Council in 2000 and then from 2002-2008, doubling as a planning commissioner for part of that time. She lives in the Ann Arbor Hills neighborhood, a short distance from downtown, and bikes to work. Ms. Lowenstein is married and has two sons.