Detroit’s Re-Do: Interview with MDI Staffers

Mar 17

12:00 PM

By Erin Piscopink

Tagged: All Neighborhoods

Read the Delicious Day post in its original format HERE


Detroit's Re-Do

The media's reports of Detroit are, at their very best, unbalanced. What they miss while running yet another "ruin porn" story are the enormous efforts (and results) of insiders, outsiders and organizations, such as Midtown Detroit.

Founded 37 years ago, Midtown Detroit's mission is to transform an area of Detroit that is not surprisingly, in the middle of the city, and home to many museums, art venues, theatres, dining options, shopping, Wayne State University and more.

I sat down with Karen Gage, Midtown Detroit's Economic Developer and co-owner of a bike shop, Wheelhouse Detroit and Lawrence Williamson Midtown Detroit's Real Estate Manager to talk about what is happening in Detroit:

Here is a bit of what they had to say:

From an urban planning perspective what are the strengths that Detroit has and some of the weaknesses it is trying to overcome?
Lawrence: It has a good fabric of historic properties, unique architecture and wonderful spaces. I have only been in Detroit for three years. I used to fly in and fly out, but then I stuck around for one weekend. It happened to be Jazz Fest weekend. I just thought, "Man there is a lot going on around here." and it was all free.

Then I went to Art Eats and Beats in Royal Oak, and then a short while after that I went to a Tigers game and sat in box seats.

I was living in an apartment downtown overlooking the river and the GM building. It had a door man, a grocery store, a fitness center and a computer room. It was 600 bucks [a month]. It was floor to ceiling glass windows. It was an experience that I did not expect.

From an urban planning perspective, it is also a city that a lot of infill development opportunities. We have a large swath of vacant and dilapidated structures. If you are in real estate, urban design, investing or planning you can come in here, get in the game and make a difference. If you go to New York City you cannot even get in the game, let alone make a difference. Here you can be a player at whatever level you choose to play.

The affordability makes it a haven for entrepreneurs. You can actually come here and not have a mortgage, invest in your start-up and have the opportunity to make some money and a difference.

What about the weaknesses?
Lawrence: I had my tires stolen one time.

Karen: Auto insurance, business insurance and house insurance is higher. Another challenge is appraised values for construction financing and real estate development. The rents are not always where they need to be in order to make a real estate deal that makes sense.

Lawrence: The good news is you can buy a house here for $30 to $50 per square foot, but there are few lenders available, and you have to shop your deal. Sometimes the appraisal does not come through, or the lender does not come through. Your options can become land contracts, pay cash or leasing.

I read that Susan Mosey, President of Midtown Detroit had said the changes in Detroit started accelerating five years ago, and three years ago they reached a crescendo. What can you attribute that to?
Lawrence: I asked her the same question and she said, "Five years ago I couldn't lease a space at the Park Shelton by the DIA, but now I get 10 calls a day. I have more space needs than I have places to put them."

Karen: The quality of the tenants looking for spaces has increased in comparison to 1998. Now, people who have financial stability and backing are contacting us whereas before it was someone who had an idea.

Lawrence: A strange idea...

Karen: Or it was McDonald's or a Walgreen's.

Do you attribute the change to something? Was there a tipping point?
Lawrence: I don't think it has been tracked or justified in way, but I think the fact that the Wayne State University Police patrol this district has an added value that is tangible and intangible. In urban spaces that are being revitalized they use Business Improvement Districts (BIDS), and those BIDS have clean and safe, economic development and destination marketing components.

Clean and safe is usually the first step. Once it is clean and safe, you can start talking about economic development. Once you start talking about economic development, you can talk about housing and real estate investing, and then you can start talking about it being a destination for people.

Karen: In 2006, we hosted the Superbowl. After the Superbowl, I think a lot of perceptions changed about what the city could be and how people feel visiting Detroit. I think that was a huge turning point; I think it changed how people look at Detroit.

Lawrence: If you experience a place your perception is not based on the media; it is based on your personal experience.

Karen: Media plays a role. Friends was filmed in a loft. They lived in urban environments. Living in urban environments is something perpetuated in the media.

It perpetuated the idea that living downtown is cool. It is different from where you grew up. It means living in a historic loft. It is different. There are historic homes. There is an attraction to that, that is not readily available in other areas.

Lawrence: It goes both ways. The local or the national media focusing on a lot of negative things, and the general media focusing on urban living.

What can the suburbs do to support the revitalization efforts?
Lawrence: I think they can share their positive experience. Go experience it yourself. That is what happened to me. It was so different than what I expected. Go to a place that makes furniture out of reclaimed lumber from demolished Detroit homes. Share a positive experience or a blog or a post.

Karen: Go visit. Go eat at a place you read about in the paper that just opened, or go back to a place you used to go to when you were little. If you go to a show or a ball game, go somewhere else before or after.

What keeps you up at night?
Lawrence: Speculators. People that are going to buy half a block, and then do nothing, and meanwhile the guy next to him is not doing anything because he is not doing anything. Then all of the momentum comes to a slow stop.

Karen: There are stronger economies, and people out there with a lot of money and buying a key piece of real estate in the city isn't that much to them.

Can you prevent speculators?
Lawrence: You can prevent it with legislation and property tax laws.

I feel this is the most optimistic I have ever been about Detroit. I feel there is a new energy. I feel like people are excited. I feel it has reached a new place. Would you agree that this is the most optimistic time in Detroit?
Karen: In 2001, there was the same sort of energy and optimism, but then the market crashed. Now it has come back, and it is a lot stronger, which is pretty cool because I was devastated when that happened, and all of those development projects just kind of fell apart.

How do we know this is not another false start?
Karen: You don't know I guess, but it is so much stronger this time. Like I mentioned before, the quality of the people who are coming in the door and inquiring is higher. We have companies like Shinola opening.

Lawrence: The largest number of hits on our commercial website are coming from New York, Chicago and Ann Arbor.

Karen: Before, in 2001, it was a local initiative, and now it is completely different.

Karen: When I came here in 2007, Dan Gilbert had bought his first building. I could see that Detroit was about to break loose, and I knew I had to buy something. The same thing happened in SoHo and in Southern California, in Los Angeles. People came in and bought the worst stuff and redeveloped it. When you see people from here investing and improving that is a positive sign. They can invest anywhere they want, and they are investing in Detroit.

How will Detroit be in 5 Years?
Karen: I think about it all the time. There will be new construction. There is not a lot of that right now. Right now it is about renovation. There will be more people living in this district and more access to goods and services. There is still a long way to go in that regard.

Lawrence: There will be new infill. There is still a challenge in getting the ripple effect to go through the neighborhoods. It is less difficult to do a deal downtown. There is a market here, major employers, perceived safety. When you go into the neighborhoods, it is a different story. It starts small and keeps going. It is the way the city grew.

Are there any projects you know will happen?
Karen: There is a big hotel and convention center. There are about 500 units of new housing. Across the street a new building is going up. It is not just Midtown. Corktown has a lot of new development. West Village has a new cute restaurant Craft Work. There is interest in the Woodbridge community.

Lawrence: There are projects in the pipeline. We just know about the ones that are capitalized or have local or state investment. With the M1 rail coming in, development will happen. Rent rates are going up. Development will happen one to two blocks off the rail line.

Why do you stay?
Karen: I lived here my whole life. I have always loved this town and this city and the people and the opportunities. Where else can you think, "I need to have my bike worked on," and open a bike store?
You can't do that in a lot of places. There are a lot of opportunities like that here. I recently bought a house. I am a homeowner in a historic district. You can do to the DIA for free. You can go to the symphony for 20 dollars. You can get season tickets for the Tigers. It is comfortable.

We have the Great Lakes and the UP. You can travel very cheap out of Detroit. You can save a lot of money because of our cost of living, but you can travel anywhere you want in the world. We have all of these natural resources and the Great Lakes, which are like the ocean.

Lawrence: I have lived in Cincinnati, Chicago, New York, LA and New Orleans. Since I have been here, I have never had a reason to move. The cost of living is reasonable. It is a small town and big city at the same time.

This is one of the only cities I have lived in where having a mortgage is optional. You can have a mortgage, but you can pay it off or pay cash – even if you are a lower wage earner. If you make $10 to $12 an hour, you can probably make it here, but in New York City you can forget it.

If I wanted to buy a three bedroom, two bath house what would that cost?
Karen: Between 80 to 200,000 dollars. There are no more houses left in Midtown. People bought them, and they are staying. Nobody is really selling right now.

Lawrence: If you really shopped, you could buy a house for $30,000, or you could buy a tax sale property, which is what I did. I have good friends here; there are great restaurants, good neighbors, extracurricular activities, access to the water. It has a major airport, the cost of living is reasonable, and I never get stuck in traffic.

Karen: Hamtramack is a really nice community, and you can buy a house there for 30,000 to 50,000 dollars.

Tell me about your bike shop, Karen.
Wheelhouse Detroit it is a bike shop on the Riverwalk. I am part owner. We do guided bicycle tours, bike rentals we sell bikes and do bike repair.

How long has it been around?
Karen: Since 2008. The bike shop came out of a bike tour that we do annually. It is called the Tour Detroit. It is one day. It takes place in September. It started about 12 years ago. The first one had 50 people, and now it has up 6000 to 7000 riders.

It is a police escorted route; as you ride they do a rolling blockade. All the participants get food at the beginning, maps and a break. We used to be able to stop at a few places and talk about back alley bikes or urban farms, but once you get up to 7000 riders you can't really do that anymore.

It goes through all of the neighborhoods. It is a set route because it has gotten so big we have to keep it the same. All of the proceeds go to build and maintain bike lanes in the city of Detroit.

How are the bike lanes in Detroit?
Karen: When we started the Tour Detroit there were none, and today there are over 180 miles of bike lanes in Detroit, and there should be over 210 miles of bike lanes by the end of next summer. It is a great biking community here, as everywhere.

Lawrence: They still ride in the winter time here.

Karen: The Wheelhouse grew out of the growing popularity of cycling. There is a Slow Roll on Monday nights. It is a free ride. They meet up at different places. They do the same type of thing that we do for the Tour Detroit except they have volunteers shut off the streets instead of police officers. It is about 3000 people a week. It is the largest weekly bike ride, I think, in the nation.

That is all I had to ask, anything else you would like to add?
Karen: Some people think I am crazy for living here, but I think they are crazy for not living here.