the fate of the ypsibator

It’s now been made public that Ann Arbor SPARK has walked away from negotiations over Ypsi’s Smith Furniture building. It seems as though they couldn’t come to terms with the building’s owner. So, they’re looking to locate their SPARK East business incubator elsewhere. Word is they’re talking to Eric and Karen Maurer about the building on the South side of Michigan Avenue, between Bombadil’s and TC’s. Our hope is that the parties can come to terms quickly, so that the facility can open before 2009. (The building, as I understand it, still needs quite a bit of work.)

The Maurers have put a lot of time and effort into their downtown properties these past several years, and, in my opinion, they deserve the stability that a 5-year lease with a relatively stable entity like SPARK would give them. I didn’t post about it here, but I was pulling for them from the beginning. In general, I think it’s a good thing when, all other things being equal, hard-working developers win out over real estate speculators who, it would seem, bought inexpensive buildings years ago in Ypsi with no intention of improving them, waiting for the day when gentrification came and they could sell for several times what they paid. One doesn’t like to see that kind of behavior rewarded.

Of course, the really important thing isn’t where the Ypsibator lands, but that it lands somewhere. While I’d like to see the Maurers rewarded for their hard work and investment in Ypsi’s downtown, it wouldn’t be the end of the world if they didn’t get it. (Spark is talking with at least one other landlord.) As I understand it, the Maurers now operate over 100 rental units, and business is brisk. The really important thing for Ypsi, and I think that they’d agree, is that SPARK signs a lease somewhere along the Michigan Avenue corridor and starts putting down roots in the community.

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21 Comments

  1. Posted July 24, 2008 at 9:33 pm | Permalink

    Amen, MM.

    Ypsi is the perfect place for a young start-up tech company. SPARK sees this and that is why they want Ypsi as a location.

    We’re close to Ann Arbor, Metro Detroit – we’re prety much in the heart of South East Michigan. Not to mention our close proximity to airports, EMU, U-M, WCC. There is also plenty of technology companies in those areas to network and partner with.

    I’m also glad the potential businesses are recieving all those benifits as described in the mlive.com article. Having worked in a start-up tech company that failed, I know that all of those things are important. It’s one thing to have a plan, it’s another to execute it effectively. It sounds like they want to protect their investments with good, sound coaching and advice, and I think that’s a wonderful idea.

    Ann Arbor SPARK is doing great things for SE Michigan’s economy right now. I’m excited they’re coming to Ypsilanti. We’re ready!

  2. Paul Schreiber
    Posted July 24, 2008 at 11:10 pm | Permalink

    According to Washtenaw County Deputy Administrator, David Behen, two sites on Michigan Avenue in downtown Ypsilanti are being considered for the SPARK East location. The opening is planned for the fourth quarter of this year.

    Paul Schreiber

  3. Ol' E Cross
    Posted July 25, 2008 at 12:09 am | Permalink

    The owner of the Smith Furniture building seems deeply committed to preserving open space.

  4. not one of the cool kids
    Posted July 25, 2008 at 9:00 am | Permalink

    Well, AT LEAST the parking lot FINALLY got paved! HA HA Congrats Puffer Reds, the Bank, the Rocket…all the stores on that block – finally after all these years got that parking lot paved…even if it was NOT for your businesses’ benefit!

  5. Posted July 25, 2008 at 10:21 am | Permalink

    Actually the lot was patched, resealed and striped for the benefit of the businesses on that block. The project has been in the works far longer than the SPARK East incubator at Smith Furniture has even been an idea.

  6. rodneyn
    Posted July 25, 2008 at 10:27 am | Permalink

    I’m a big fan of the Maurers development projects downtown – they have done top-notch work on the old Kresge Building loft project, and I have no doubt that they will be successful with their other projects. In fact, they are the proof that competent developers don’t need government handouts, intervention or bullying to be successful in Ypsilanti (unlike the Thompson Block ‘developer’).

    The Maurers’ building next to Bombadills would be a fine “back-up” site for the incubator. However, I have no doubt that they will make that redevelopment a huge success anyway, so why not put the incubator somewhere that it can do more good. Let the Maurers do what they do well by bringing in more residents and businesses downtown. Why not put the incubator in our nearly empty City Hall?

    Surely with all of the cutting and cutting and cutting of City Hall staff that Mayors Farmer and Schreiber have insisted they’ve done over the past few years, there ought to be plenty of City Hall office space available to house the Ann Arbor Spark business incubator…

    With a little bit of effort, the whole top floor of City Hall could easily be made available for this economic development project. Just think, the City could gain a bit of rental income AND promote economic development at the same time! The 4th floor offers great views and just needs a bit of sprucing up to be all set!

    The City has a bounty of excess or underutilized office space available after all. The City Manager could take over the old City Clerk’s office on the first floor. The Asst. City Manager and their assistant could either squeeze in with the clerks or take over the old Human Resource director’s offices on the second floor. The City Planner (and anyone else I’m not aware of) could either bunk in with the Building Dept. offices in the basement or move in with the DDA or the Fire Dept. offices.

    What do you think, Mr. Mayor? Council?

  7. amused1
    Posted July 25, 2008 at 12:32 pm | Permalink

    Interesting idea rodneyn. And while the idea of rental income going directly to the city is interesting, I’d rather see the money go to a local business owner. Increasing tenancy in currently vacant offices would increase profits that encourage more business in the DT area.

    Also, I can totally imagine the city’s foray into rental being a whole new source of complaints against the administration. I can see people complaining that the city didn’t charge enough rent and undercut local businesses, charged too much and so didn’t get the occupancy someone felt was appropriate, spent too much money on atty fees for writing and reviewing leases, spent too much money on movers consolidating offices, spent too much getting separate utility meters or didn’t charge enough for utilities if included in the rent, etc. etc. etc.

    So yeah, while it might bring in some income my gut tells me it would become a wedge issue. And I think we’ve got enough of those already.

    My .02, for what it’s worth.

  8. Brackache
    Posted July 25, 2008 at 3:43 pm | Permalink

    City Hall would be an awesome place to have laser tag.

  9. Posted July 25, 2008 at 5:59 pm | Permalink

    Brackache –

    Really only from the 1st floor down. The upper stories don’t really have enough maneuverability to make it all that interesting, but the building has some sweet basements.

  10. John on Forest
    Posted July 28, 2008 at 4:28 pm | Permalink

    amused1,

    I agree. If the city can consolidate it’s offices in one building and then sell one of it’s properties to get it back on the tax roles, I’d support that idea. But I don’t think the police or fire departments, either one, could squeeze into City Hall or vise versa.

    The city should NOT be in the business of competing with commercial property rentals.

  11. BrianR
    Posted July 28, 2008 at 5:36 pm | Permalink

    For what it’s worth, the City Manager was looking into consolidating City Hall functions to the 2nd floor of the 14-A2 District Court building. That way we could divest ourselves of 1 S Huron. City Council meetings would be held at some other City-owned property such as the Senior Center.

    Now that the Smith furniture building is out of play with respect to the proposed incubator, the odds-on favorite to host SPARK is most likely the Courthouse.

  12. nammeroo
    Posted July 28, 2008 at 11:15 pm | Permalink

    The courthouse is a tough location for such a venture. No visibility, lousy views, parking???, and of course the wonderful vibe that comes from the court’s operations and clientele. I would agree with the notion of parking City Hall operations there, however. The Senior Center is available for Council and other public meetings, and City Hall would make a nice loft re-development!

    Hey, Karen, Hey Eric – Here’s another one for you! Just keep it away from Beal!

  13. nammeroo
    Posted July 28, 2008 at 11:18 pm | Permalink

    You know, the former Christian Science church building on Washtenaw downtown is for sale. What a cool place THAT would be to host a business incubator! Of course, it has no more parking than the courthouse, but at least there’s church parking across the street that might be available for lease during the week.

  14. not one of the cool kids
    Posted July 28, 2008 at 11:59 pm | Permalink

    I always thought that the 2nd floor of the court building was remodeled for Tabbey to use as a Blind Pig for himself and all the landlords in town! (It is very nice up there…but empty all day long hmmm)
    But I like the City Managers idea to move the Ypsilanti city government into a county owned building better. Just think, a county owned building would be a very appropriate middle ground to start from when the township takes over the city.

  15. Posted July 29, 2008 at 12:53 am | Permalink

    JoF wrote:

    >> The city should NOT be in the business of competing
    >> with commercial property rentals.

    I guess John would not be in favor of the City and the Ypsilanti Housing Commission acquiring more commercial properties and keeping them off the tax rolls.

    Especially given that the City and the Housing Commission already have more properties without certificates of occupancy than any other landlord in the city.

    Did you know that the City/Housing Commission have 199 units in the City. Last year they paid a total of $1,900 in total taxes to the city. That is $9.54 a year they pay in taxes for each unit.

    By contrast a 4 unit apartment just two blocks away from a Housing Commission property pays $5,500 in property taxes per year. $2,2000 of that goes to the city. Yep you guessed right, a commercial property owner pays $300 more per year in taxes on a 4 unit property than the Housing Commission pays for 199 units.

    The commercial property owner pays $550 per year per unit. The Housing commission pays $9.54 per unit.

    I agree with JoF, the city should not be competing with commercial property rentals.

    – Steve

  16. Posted July 29, 2008 at 10:11 am | Permalink

    JOF –

    I’m sorry you feel slighted that you think I took one of your ideas and ran with it. The idea of aggressively marketing ACH and other industrial properties in the City is a good one no matter whose idea it is. It has been widely discussed long before our conversation by me and others but if it makes you feel better, I’ll refer to it as the JOF marketing plan. My intention was to take a policy position (not credit) that I believe is in the best interest of the City. And obviously you do too.

    My concern here, John, is that we have an area of agreement and you want to fight about it. I’m much more interested in building a consensus around things we agree on and moving forward than creating disagreement where none exists just for its own sake. That’s how I approached things in the past and will, if elected, approach them in the future.

  17. Posted July 29, 2008 at 10:19 am | Permalink

    Whoops. Sorry I meant to post the above post on the other thread. Apologies for the duplication.

  18. Posted July 29, 2008 at 2:03 pm | Permalink

    Steve –

    For whatever faults it may have, the Ypsilanti Housing Commission (YHC) is not in competition with the private sector. It provides housing for a low income population that is not served by the private sector. As I have suggested to you before, anytime you, Barnes and Barnes or another private rental operation wants to provide housing to the same identified population under all the same bureaucratic rules and regulations of HUD that the YHC has to operate under, I’m all ears. Not only that but the Section 8 program that is suppose to “replace” public housing by providing certificates that can be used anywhere is woefully under funded with a waiting list of nearly two years. Many rental owners do not except section 8 families, further exacerbating the situation. Incidentally, this is a discrimination that is prohibited in the City of Ypsilanti.

    I am familiar with public housing. I have relatives that grew up in public housing (in another era) and I have served on the Ypsilanti Housing Commission for a rough period or time. I have first hand knowledge of how difficult HUD and its bureaucracy is to deal with and how the Feds (both Democrats and Republicans) have abandoned public housing over the years. Yes there are problems that can and should resolved and the management of YHC can always be improved but the idea that eliminating public housing is somehow an answer is running away from the broader issue of affordable housing and how we in Washtenaw County deal with it.

  19. Posted July 30, 2008 at 1:32 am | Permalink

    Hi Pete,

    There have been and there are still quality companies that can and will operate public housing and meet the myriad and sometimes byzantine HUD requirements.

    For example McKinley runs a public housing section 8 property in Taylor Michigan. You can find more information here.

    http://www.mckinley.com/apartments/michigan/taylor/the-courtyards-at-the-villages-of-taylor

    There have been a number of Hope VI projects in Boston and Connecticut that could serve as models for increased private/public participation in subsidized Housing. Some of these projects go back to 1998.

    The concern that I have is the current Housing Commission has demonstrated that they cannot successfully maintain safe and quality housing in Ypsilanti.

    Yet you are about to see an announcement from the City and Housing Commission that they are moving forward in taking over the Parkridge apartments along Hamilton and I-94.

    – Steve

  20. Posted July 30, 2008 at 7:18 am | Permalink

    Steve –

    Running a Section 8 housing complex where through the Section 8 certificate process, the property owner-manager receives “market value” for the rental property is NOT the same as operating public housing. But I’m listening…

  21. Posted July 30, 2008 at 11:18 am | Permalink

    Pete, I agree with you.

    I understand how much more difficult public housing is over subsidized voucher housing.

    However, I believe the Hope VI programs are public housing not voucher programs.

    Mckinley proposed a Hope VI program for Ypsilanti several years ago. But it was poo-poo’d by the policy wonks at City Hall and the Housing Commission before they could get a full hearing on their plan. (Queue someone from City Hall stepping in to tell us why the McKinley Plan would never work. Though I am not to sure how you do that without being negative.)

    I am not advocating we get rid or even privatize public housing. Though I think it should be looked at if it can save money and provide better service and safer housing then what is currently being provided.

    The concern I have is the Housing Commission and the City are not able to take care of the 199 units they have right now, it is hard for me to see that adding another 144 units will make things better for everyone currently in Public Housing.

    Worse, it will provide a distraction for the current Housing Administration to have to deal with the Parkridge and their lofty plans, rather than focusing on fixing the problems they have right now.

    I think you let an organization, public or private, expand their scope and take on new projects, AFTER they have shown that they can take care of the things they are tasked with today.

    If an employee is failing to take care of the projects and customers they currently have, you don’t give an employee a new project and expect success. The new project typically fails and the current projects fall further behind.

    The Housing Commission and the City should not be taking ownership and begin the process of marketing Parkridge to other investors, while the current Housing Commission properties have failed numerous city inspections including issues for health and safety.

    Notice the words, “marketing Parkridge”.

    The City and the Housing Commission are in many ways undertaking another land speculation deal hoping to market the property to other investors with the promise of big tax breaks and give-a-ways. It is with the best intentions, but doesn’t this sound eerily familiar. Reminds me of Water Street.

    The City has no proven track record and nor does the staff at the Housing Commission have a proven track record of being successful in marketing investor properties for subsidized housing.

    In fact, they have a proven track record of NOT being able to market properties and manage a redevelopment project.

    Worse, they are unable to safely manage the properties they currently own.

    I am not arguing against Public Housing, what I am suggesting is before the City and the Housing Commission take on new projects, they should fix the properties they have and address the numerous health and safety problems and get CofO’s for their current properties.

    Show the community the City and Housing Commission can responsibly manage their existing properties then come to the community to say they want to take on more.

    Cheers!

    – Steve

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