Detroit's East Riverfront could see big changes in 2019

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Some recent announcements indicate that several large public and private projects will be getting underway on the East Riverfront:

  • Dan Gilbert’s Bedrock development company purchased a 2.75 acre waterfront site from Syncora for $5 million. The site, located a few blocks east of the Renaissance Center, is zoned for over 400,000 SF of what will likely be residential development.

  • New concepts were unveiled for Milliken State Park that would expand its recreational amenities and make stronger connections to the Outdoor Adventure Center and the marina.

  • City Growth Partners, a development firm headed by a former Detroit Economic Growth Corp official, purchased the site immediately east of the Syncora site and plans to build 300 apartments and a 100 room boutique hotel on the 3.1 acre site. The developer is working with international architecture firm ODA, which should bring some sophisticated design to the riverfront.

  • The Stone Soap Building, a mixed use re-development adjacent to City Growth Partners’ new site, is expected to finally get under way this spring. The project will include 48 condominiums, a food hall, and a Shakespeare theater.

Though they will take several years to complete, these projects will bring a new level of activity to the riverfront. The increased density will be key to supporting the retail establishments and restaurants that are a natural fit for this neighborhood.

Detroit 2018 wrap-up

Detroit had a busy 2018, and 2019 is shaping up to be even busier. Crain’s put out a Top 10 list for 2018, and Curbed points out developments to watch in 2019. Here’s our list of the most significant real estate developments of 2018, and trends to watch in 2019.

Ford bought Michigan Central Station

Renovations have begun and Ford has already moved part of their electric and autonomous vehicle division to a different location in Corktown. Ford is setting up a true urban campus housed in various buildings spread across the neighborhood. In total, the automaker plans to invest over $700 million to renovate the train station and other properties it has bought in the area.

Detroit has some exciting new downtown hotels

The Siren Hotel opened in spring 2018, the Shinola is opening January 2, and the Element will open in the long-vacant Metropolitan Building early next year. Despite the addition of these relatively small boutique hotels, many business leaders feel that Detroit still lacks enough hotel rooms to attract large events such as the NCAA Final Four.

The Detroit Riverfront continues its transformation

Atwater Beach started construction on the East Riverfront this year and will be complete by next summer. Noted landscape architect Michael Van Valkenburgh, who designed Brooklyn Bridge Park in New York and Maggie Daley Park in Chicago, was chosen to design the expansion on the West Riverfront. The new park will be funded in part by a $50 million donation from the Ralph C. Wilson Jr. Foundation.

Dan Gilbert’s Bedrock broke ground on the Hudsons site and on the Monroe Blocks

The two massive mixed-use developments will reshape Detroit’s skyline when they both open in 2022. At 912 feet, the Hudson’s tower will be the tallest building in Detroit.

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Transportation options got more creative

Following the opening of the Q Line streetcar in 2017, bike lanes, scooters, and driverless shuttles dominated the news in 2018.

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Get ready for a wave of residential development that started in 2018

The first residents have moved in at City Modern in Brush Park, and two projects in Corktown are nearing completion. All told, approximately 2,000 new rental units will hit the market in 2019. This would be a modest supply in many cities, but in Detroit it’s a bona fide construction boom. The vacancy rate stands at 3.1% and net absorption last year was 2,400 units, so while the new supply may slow rental growth, it’s unlikely to result in a glut of new apartments.

In Corktown, Ford starts renovations on its new headquarters

Ford began work on its planned $350 million renovation of Michigan Central Station. The historic building has been neglected for decades, so critical work needs to be done to stabilize it and protect it from further deterioration over the winter. Ford already has a 200 person advance team in Corktown, including the CEO of Ford Autonomous Vehicles. They are working from a renovated warehouse building that Ford purchased earlier this year. The space’s open, non-hierarchical design represents a big cultural shift from Ford’s Dearborn headquarters. It’s also a good indicator of what offices in Michigan Central Station may look like.

Michigan Central Station’s lobby

Michigan Central Station’s lobby

Fiat Chrysler reopens a plant in Detroit

A week after GM announced that it will idle its Hamtramck plant, Fiat Chrysler said it will build a new Jeep at its idled Mack Avenue Engine Plant II. This could add up to 400 jobs at the plant on Detroit’s East Side. It’s part of a larger facility that employs 5,000 workers and will be Detroit’s only remaining automotive factory when the GM facility closes. While the additional jobs won’t have much of an impact on the overall Detroit economy, they will offset some of the GM cuts.

Fiat Chrysler’s Jefferson Avenue Plant

Fiat Chrysler’s Jefferson Avenue Plant

GM's cuts: Short term pain, long term gain.

GM recently announced that it will stop production at up to five plants in North America, including the Hamtramck assembly plant in Detroit and a transmission plant in suburban Warren. Hamtramck employs 1,542 workers, so a lot of families will be affected by this decision. In addition, some 8,000 salaried positions may be eliminated, many of them at GM’s Warren MI technical center. Some of the plants will likely be re-opened to produce new lines of vehicles, but when and at what level of capacity remains unknown.

Let’s look at this in context. The Detroit has added 4,500 manufacturing jobs in the past year, so even if neither of the Detroit area plants are reopened, the cuts amount to less than half of manufacturing job growth. Total cuts, including salaried positions amount to less than 0.5% of the Detroit MSA’s total employment.

GM, already a leader in autonomous and electric vehicles, is taking painful but necessary steps to position itself for the ongoing disruption in the automobile industry. Future job growth will not come from designing or manufacturing gas powered sedans. It will come from developing autonomous and electric vehicles and adapting to new technologies. Detroit’s recovery will continue, and more nimble and profitable automotive companies can be important contributors to it.

© John F. Martin/General Motors.

© John F. Martin/General Motors.