It could be called Ann Arbor’s odd couple.

On the 200 block of South Main Street, two unlikely retailers rub shoulders: eclectic gift shop The Peaceable Kingdom and a Wireless Zone, retailer of the cellular phone titan Verizon Wireless. The former boasts Sarah Palin action figures, Juvenile Delinquent Mints (“Wild depraved youth with minty fresh breath!”) and other culturally aware tchotchkes. The latter sells cell phone paraphernalia. According to its website, there are 34 Wireless Zone stores in the state of Michigan. There is only one The Peaceable Kingdom.

In premise, the idea that such culturally different brands share a wall is starkly incongruent. But observe Main Street on a crisp September evening when it bursts with night crawlers kissed by the ambient glow of shop lights, and the seemingly oil-and-water union of chain-and-local shops appears to coexist harmoniously.

In a town known for its eclectic character, this blend is to be expected.

“What makes Ann Arbor great is that it combines the character of a college town, a place you come to when you go out to school and fall in love with, with the access … that perhaps a bigger city has,” said Andy LaBarre, vice president of government relations for the Ann Arbor/Ypsilanti Regional Chamber. “It’s a perfect mix.”

Navigating economic waters while preserving a city’s identity is a difficult balance to strike — a feat that, according to Ann Arbor Mayor John Hieftje, requires dedicated maintenance and a well-reasoned approach.

“It’s always a challenge to keep moving forward economically while maintaining the culture and character of the city,” Hieftje said.

Susan Pollay, executive director of the Ann Arbor Downtown Development Authority, believes the city’s presence of chain and local businesses has long been well-balanced — labeling this mix one of Ann Arbor’s “great strengths.”

“It’s valuable to think of downtown like a forest or an ecosystem,” Pollay said. “You need old buildings and new buildings. You need big things and small things. You need national tenants who have the big advertising budgets, and you need the small independents to give you an identity. In a forest … it supports itself better by having a variety.”

According to Maura Thomson, the executive director of non-profit merchant organization Main Street Area Association, this identity is integral for attracting traffic downtown.

“Throughout this region I think Ann Arbor has the distinction as being known as the place where you’re going to see and do something different … I don’t think you can overstate the importance of keeping Ann Arbor different,” Thomson said.

A Changing Face

Brick streets, neatly tucked low-rises and a bustling farmer’s market coalesce for a pleasant dose of small town charm. The Kerrytown aura is inescapable.

So to hear Fourth Avenue, home to the neighborhood’s People’s Food Co-op, described as once akin to a “red-light district” is nothing short of surprising.

“In the ’70s when malls became the rage, downtown became a shell … You didn’t want to walk down here,” said Ingrid Ault, the executive director of independent business advocate Think Local First.

Hieftje echoes Ault’s sentiments, explaining that major retailers left en masse following the construction of Briarwood Mall in 1973 — rendering the Ann Arbor of the’70s and ’80s a “pretty dead place.”

But according to local real estate developer Ed Shaffran, who helms The Shaffran Companies, a firm specializing in historic units, locally-owned businesses were able to take advantage of the void.

“When Briarwood came that’s when all the big boys left,” Shaffran said. “That gave an opportunity for small mom-and-pops and local businesses to establish themselves and nurture and grow.”

Ault credits the formation of the Downtown Development Authority with helping to inject vitality into the city. Created in 1982 by the state of Michigan, the organization is described on its 2011 Annual Report as striving to “undertake public improvements that have the greatest impact in strengthening the downtown area and attracting new private investments.”

Main Street has evolved into a stretch of polished dining — spurred by the addition of The Real Seafood Company in 1975, one of a bevy of restaurants under the Main Street Ventures conglomerate — populating what Thomson describes as a previously retail-heavy block.

“Downtown if anything has shrunk from the perspective of retail … Less retail, more restaurants and more arts and entertainment,” Shaffran said.

Similarly, South University Avenue has experienced a significant facelift.

“When I first came here, South U really felt like a village,” Pollay said. “There was a gas station on South U, there was a movie theater on South U, I could buy all my clothes on South U, bookstores … anything you needed was there.”

The DDA’s State of Downtown Ann Arbor Report — sampling hundreds of businesses from the Polk Directory —published last July, highlights an upswing in downtown dining: In 1982, “restaurants, cafes & taverns” accounted for just 7.11 percent of the city’s commercial sectors. Now, in 2011, it is 18.07 percent.

But just as it is crucial to temper chain with local, so too is it to provide variety in developments.

“We fortunately have some really great landlords in our community who believe strongly in retail and won’t lease out their space to coffee shops and restaurants,” Ault said. “If you don’t have the mix we’re not interesting anymore, and we become a food court and nobody wants to be a food court.”

Staying within that mix, regardless of scale (as underscored by the recent liquidation of longtime Ann Arbor-based book chain Borders Inc.) is hardly an easy feat. And in a down economy — according to the Bureau of Labor Statistics, as of August the state of Michigan had the third-highest unemployment rate in the nation at 11.2 percent.

An Economy of Scales

“In 1971, I sold used blue jeans, for probably $5 to $10 — they had companies who would go to all the Goodwill stores and collect Levis, and then you’d buy them. Now I’m selling jeans that the manufacturers make to look used for over $100.”

Ed Davidson is the owner of popular State Street outfitter Bivouac. Next month, his store will celebrate its 40th year of business. In his time serving the community, Davidson’s key to longevity is simple.

“We’ve been here 40 years because we’ve changed with the time,” Davidson said.

Change is integral to an industry that he perceives as cloudy.

“(Nationally) there are not many independents left,” Davidson said. “This street is the same.”

An even older bastion of retail shares the block with Bivouac — Nickels Arcade staple Van Boven, established in 1921. Like Bivouac, not only has the men’s retailer survived through expanding its repertoire of offerings, but it also benefits from a loyal customer base.

“They walk through here and just look at the walls,” said Hank Schoch, a Van Boven salesman of 13 years. “I don’t know if they breathe the air to see if it still smells like an old attic or whatever we smell like to people. It’s part of who they are.”

Even if well-established, long-time Ann Arbor stores are cognizant of the tepid economy. According to Carol Lopez, the owner of The Peaceable Kingdom, established in 1973, scuttling economic times are a source of apprehension.

“They aren’t a bit more tough — they’re off badly,” Lopez said. “I don’t know how it’s going to shake out.”

Still, even though the state of Michigan might have encountered a sputtering economy since the economic crisis in 2008, Hieftje dates the state’s decline back to the early 2000s. Comparative to the state, though, Ann Arbor seems to “be keeping our head above water,” Hieftje said.

Pollay points to a handful of trends explaining tight times for retailers. Chiefly, the advent of e-commerce no longer necessitates a brick-and-mortar business for the consumer. Furthermore, Pollay suggests that consumers, being more “targeted” in their purchases, are not spending as much as decades past.

The same State of Downtown Ann Arbor Report highlights the declining presence of retail downtown: as of 2011, it accounted for 20.4 percent of Ann Arbor’s commercial sectors — compared to 21.99 percent in 1999 and 30.29 percent in 1982.

Not only are retailers at the mercy of consumer spending habits, but landlords, as well — according to Thomson, mom-and-pop shops lack the “corporate money and deeper pockets” boasted by bigger competitors.

But what local ventures lack in backing, they can make up in branding — a component essential to the makeup of downtown.

“We’ve branded ourselves as an interesting, fun, socially open place to be,” Ault said. “And that is because of the identity we’ve developed because of the small businesses.”

As per its website, Think Local First strives “to support and cultivate locally-owned, independent businesses in Washtenaw County, Michigan.” As the organization’s executive director, Ault is quick to extoll the virtues of independents.

According to Ault, not only does supporting independents better incubate money within the local economy, but it forges a stronger community-retailer connection — to purchase local is to experience a labor of love.

“When you go into a small business, you’re walking into someone’s passion,” Ault said. “They care very deeply about what they do.”

Nevertheless, Ault openly champions the value of competition in a business community, and cites Grand Rapids-based supermarket chain Meijer as an example of a large company that has bettered its community through philanthropic efforts.

“We’re not ‘think local always,’ we’re Think Local First,” Ault said. “All we’re saying is it’s a big pie, and we deserve a slice of it.”

Despite the arrival of a CVS Pharmacy to State Street last March and a pair of 7-Eleven stores on State and Main Streets last January and September, respectively, coupled with the addition of the Sterling 411 Lofts on Washington Street in 2009 and Zaragon Place on East University Avenue in 2008 (and with Zaragon West currently under construction), Hieftje does not think the city has strayed from traditionalist roots.

“There are folks in Ann Arbor that, so to speak, would like to see the city kind of frozen in amber,” Hieftje said. “Like, ‘Wow, I want it like the way it was in 1966 or something.’ I’ve been here a long time, and it never was that way. It’s always changed, and it’s going to continue to change. We can’t keep it from changing.”

And while a leviathan chain might lack the typical Ann Arbor imprint, this factor doesn’t neccessarily translate into an awkward community fit.

“Residents are good, traffic is good, 24 hours is very convenient for all of the students around here … So it makes everyone happy over here,” said owner Vipul Patel of his recently opened 7-Eleven on South Main Street.

“I’m very confident that over some time we’ll be very welcomed by the community,” Patel added.

Moving on Up

Though the tally between chain and local businesses might be harder to detect, more noticeable within recent years has been the city’s vertical expansion encompassing the addition of Zaragon Place on East University Avenue (with its sequel, Zaragon West, already under construction) and Sterling 411 Lofts on Washington Street. This development marks a rash of “mixed-use” — a combination of retail and residential space — real estate in the city.

According to Pollay, previous zoning restrictions forbade developments of the buildings’ respective heights. But while working on a “Green Belt” initiative in 2003, the city realized that developing its “core” — the more central area of downtown, and not its outskirts — helped combat urban sprawl by providing increased downtown residential options.

“The zoning was changed to enable mixed use and residential … both of which are seen to be assets to downtown,” Pollay said. “The more people that live here, the more likely our retailers are to survive and thrive.”

The efforts culminated into a six-year rezoning process, according to Hieftje.

Unsurprisingly, the development had its detractors: In particular, the construction of Zaragon Place required the demolition of the 84-year-old Anberay Apartments complex — a move which, according to a February 2007 article in The Michigan Daily, struck a nerve with those attached to the historic building.

Even today, a few years after the project’s completion, not all are pleased. For some, low-rise developments are preferable.

“That’s what Ann Arbor was,” said Ann Arbor resident Don Danyko. “If you want a big city, go to New York. This isn’t New York, it’s Ann Arbor.”

Pollay concedes that there are those “not comfortable” with high-rises. However, she thinks the project’s completion signals an understanding toward the importance of density, sustainability and, with the presence of ground-floor retail to grab individuals’ attention, a pedestrian-friendly city.

Also, she feels that mixed-use high-rises contribute to the diversity and character of Ann Arbor.

“That’s downtown’s strength,” she said. “Same way that you have an older building next to a new building. Same way that you have a tall building next a smaller building.”

Still, similar to a distinct, small business, the historical low-rises further cement the city’s welcoming appeal.

“I think maybe from the generational standpoint it’s a remembrance of good times or ‘that’s the way things always used to be,” Shaffran said. “Not that we want to freeze dry everything.”

While the city cannot legally block any development that meets zoning requirements, the mayor noted that developers must adhere to aesthetic criteria outlined in the Downtown Ann Arbor Design Guidelines. The extensive report dissects the style of each area, encouraging developments to “reflect the design context and traditions of its character districts, blocks and streets on which it is located.”

“It makes me feel pretty comfortable about some taller buildings going in downtown also knowing that we have 14 historic districts in the city so there are some parts that are never going to change,” Hieftje said. “So when you get back to it, how can we have this economic activity going on in the city and also protect this culture and heritage that we have? That’s part of the way we’re doing it — parts of the downtown will be preserved.”

Looking forward, Hieftje remains focused on, among other initiatives, continually strengthening the city’s green identity — through, for example, improving public transit to eliminate the number of automobiles entering the city — and, by extension, its overall diversity.

Ultimately, any strand of downtown evolution highlights a complex intersection of policy, economics and identity preservation.

“What we can do is plan for (change) and try to direct that change in a good direction,” he said. “And hopefully we’re doing that.”

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