Keeping alumni and friends connected to U-M

A2 on the (high) rise

By Jeff Mortimer
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Michigan bus at Zaragon Place.

Zaragon Place is located on East University, bounded by South University and Willard streets. (Image: Austin Thomason, Michigan Photography.)

When she was an undergraduate at England’s University of Warwick, Linda Newman and her friends “didn’t aspire to luxurious environments.”

But, as U-M’s housing director well knows, that is so 20th century. “I think today’s 18-to-25-year-olds have grown up with expectations that are very different than when I was in school,” Newman says.

You don’t have to look far in today’s Ann Arbor to see one of the most conspicuous effects of those changing expectations. In fact, if you’re anywhere near the South University and State Street corridors, you simply have to open your eyes. Six privately owned apartment buildings, ranging from eight to 14 stories high, have opened in the last nine years, five since 2009. Two more are shovel-ready. All target the undergraduate market. Properties already on line or in the pipeline eventually will add about 1,000 units and 2,600 bedrooms to the local housing inventory.

The more recently completed buildings bill themselves as luxury high-rises, and rightly so. They come with plenty of amenities—fitness centers, game rooms, yoga studios, flat-screen TVs on living room and bedroom walls, on-site grocery stores, bars, and restaurants—that would blow the mind of anyone who graduated more than 10 years ago. Rents, ranging from $1,000 to $1,800 per person per month, are commensurate with the facilities.

As a result, Ann Arbor’s changing skyline is increasingly etched with slick brick towers, replacing many funky and fondly remembered establishments from the college town of yore. And these new edifices reflect and portend cultural shifts that transcend mere aesthetics.

Going up?

Rising towers of Ann Arbor.

Zaragon West at Thompson and East William streets joins Maynard House and Tower Plaza, two of the original high rises that mark Ann Arbor’s skyline. (Image: Austin Thomason, Michigan Photography.)


Municipal zoning changes recently signaled an end to the era in which tall buildings, with few exceptions, were anathema in Ann Arbor. The upward trajectory caught momentum with Corner House Lofts at State and Washington streets. Developers had struggled to gain city approval for years before finally getting the green light to open in 2004. This marked the beginning of a philosophical shift on the part of city leaders toward the “walkable urbanism” concept as a way to grow Ann Arbor, linking dense downtown development to viable commercial activity.

This shift converged with other forces reshaping the national economy. The financial meltdown of 2008 pushed capital markets into what were perceived as safe investments, i.e., the nation’s undergraduate population, especially at vast institutions like the University of Michigan, which are stable at worst. Many undergrads are subsidized (at least in part) by their parents. As a rule, they are a better financial bet than graduate students, who may be on their own dime with families to support. In addition, today’s undergrad is accustomed to certain amenities, from personal privacy to wireless Internet, and University leaders and real estate developers have picked up on that trend.

Campus life

Corner House lofts.

Corner House Lofts is located at the corner of State and Washington streets. One of its closest neighbors is the newest on-campus residence hall and complex, North Quad. (Image: Austin Thomason, Michigan Photography.)

When the University completes its Residential Life Initiatives program in 2016, it will have spent nearly $900 million over 10 years to renovate and rejuvenate student housing facilities on campus. In 2010 the striking North Quadrangle Residential and Academic Complex opened at the intersection of State and Huron streets, U-M’s first new residence hall in 43 years. In 2015 a new state-of-the-art residential complex for graduate students is slated to open on the north side of East Madison Street between South Division and Thompson streets. The new complex is financed in large part by a $110 million gift of securities from Berkshire Hathaway Vice Chairman Charles Munger.

The monthly tab paid by U-M’s on-campus residents is about the same as that paid for high-rise living, but the inclusion of meals in residence halls keeps them competitive with their off-campus counterparts. The real competition for undergrad tenants isn’t the private sector’s downtown high-rises, says Hank Baier, associate vice president for U-M facilities and operations. It’s Michigan’s peer institutions.

“We’re in a situation where we’re competing for the best students, and their expectations have moved upward,” Baier says. “We’re not doing anything crazy [in the residence halls]. We don’t have spas. But students today kind of expect air-conditioning.”

Even more important, “We think we offer a greater academic benefit,” Baier says when comparing the residence halls to the high-end apartment complexes. “In all the places where we do major renovations, we include student learning spaces. That’s not the private sector’s mission, but it’s our mission.”

North Quad, for example, is dubbed a complex because, in addition to 450 beds, it also houses the Department of Screen Arts and Cultures, the Department of Communication Studies, the Language Resource Center, and the Sweetland Writing Center, all components of the College of Literature, Science, and the Arts. North Quad also is home to the School of Information. There are TV studios, a media gateway, a dining hall, media-intensive classrooms and research areas, and exhibit space, as well as faculty offices, academic administration space, and graduate student workspace.

“I have a deep-seated belief in the importance of the residential experience as a complement to the classroom experience,” says housing director Newman. “We play a really important role in providing the backdrop that helps [students] be successful.”

In addition to supplemental learning/community spaces, “one of the things that differentiates us from the apartment communities is security,” Newman adds. University Housing has its own security officers who are present overnight in residence halls “helping students in all kinds of ways.”

Off-campus impact

Forest structure.

Landmark, located at South University and Forest streets, shares the intersection with University Towers (not pictured), another of Ann Arbor’s tallest apartment buildings. (Image: Austin Thomason, Michigan Photography.)


The surge in new off-campus development impacts more than students, however. It illuminates a host of new economic and cultural implications for residents and business owners in Ann Arbor.

“This is adding huge amounts of new supply in big chunks,” says Chris Leinberger, an oft-quoted urban planning authority and Brookings Institution fellow who was the first director of the University’s graduate program in real estate development. “Sure, the people who are living in those high rises are well-to-do, but it’s going to add inventory to the system and will drive down the price of rental housing in general, and that’s a good thing.”

Peter Allen, a longtime Ann Arbor real estate developer and consultant who has taught in the Ross School of Business since 1981, expects that neighborhoods close to campus, like Burns Park, the Old West Side, and the Old Fourth Ward, will see single-family homes that had been converted to student housing return to their original purpose. He foresees a time when those homes will be “fixed up and occupied by young families and young professionals” as undergrads increasingly move toward high-rise living downtown.

One of the chief arguments espoused by proponents of urban density is its effect on the environment. Unlike suburbanization, which gobbles up ecosystems with breakneck speed, the new “walkable urbanism” builds housing up rather than out. In Ann Arbor in particular, whose voters approved a millage to create and sustain a “green belt” around it in 2003, vertical expansion is the only significant way the city can grow. Many of those same voters are concerned about maintaining the city’s character amid all this new development, however.

Bubbling up?

construction site.

The Varsity, on Washington between State and Division, is still under construction. Its sign reads “Luxury Student Living: Now Leasing.” Its neighbor is Sterling 411, another new apartment complex at the corner of Washington and Division. (Image: Austin Thomason, Michigan Photography.)

Doug Kelbaugh, professor of architecture and urban and regional planning, and dean of the Taubman College of Architecture and Urban Planning from 1998-2008, teaches a course on sustainable urbanism and architecture in which, he says, “the environmental paradox of cities and the many advantages of urbanism are central. As I am wont to say, ‘If you love nature, give it a break and live in the city.’ The density is not only environmentally greener, if less leafy, than the suburbs, it also sponsors a more vibrant, diverse, walkable, bikable, transit-friendly place to live, work, and play. I think it’s a positive social trend.”

But some observers see serpents lurking in this sparkly student Eden. Even Kelbaugh notes “the growing wealth disparity in American society is reflected in the contemporary student body, with an increasingly wealthy component able to pay higher rents while the majority have become mired deeper in debt.”

And there are those in the housing industry who voice more practical apprehensions. All the high-rises essentially have been full to date, but will there be enough demand when all of the University’s housing is back on line in 2016?

Amy Khan manages Corner House Lofts for her family’s company, CMB Property Management. “It’s much more difficult to lease it out now [that the city has] allowed so many apartment buildings to be built,” she says. “There could be a bit of concern when the University is 100 percent open. I think the city is going to be really sorry in five or six years unless the University increases enrollment.”

“There’s way too much development in the short term and it is a concern,” says Brian Dinerstein, president of the Houston-based Dinerstein Companies, which owns the 11-story Sterling 411 Lofts at 301 E. Washington St. “All of the properties are targeting the highest price point in market.” Dinerstein has designed and built 58 such properties, but Sterling 411 is one of only three it owns.

“We bought this property as a long-term play because we love the asset and we’ve been very happy with it,” Dinerstein says, “but there are definitely some challenges in the market right now, with the influx of new product.”

“If I were a real estate investor, I would have stopped investing in student housing about three buildings ago,” says Ann Arbor Mayor John Hieftje, who was a realtor himself before he was first elected in 2000. “But they must know something we don’t.”

Supply and demand

Cluster behind Lane Hall.

The view beyond Lane Hall features new neighboring high rises, the Varsity and Sterling 411 Lofts. (Image: Austin Thomason, Michigan Photography.)

A cursory look at the numbers suggests some basis for a rosy outlook. The University’s total undergraduate housing capacity, when all buildings are on line, is 10,500, representing 37 percent of the undergraduate population. That leaves about 15,000 undergraduates in need of off-campus housing. When you include graduate students, that number jumps to about 30,000. And despite the seemingly dramatic upsurge in high-rise construction, Ann Arbor is adding “only” 2,600 beds to its existing inventory.

Besides, says Leinberger, “Real estate developers are optimists by their very nature. Boom and bust [is] the nature of the business. We overbuild any market no matter how good it is.”

The limits of that optimism may be in for a test. A review of zoning laws is underway, in the wake of Ann Arbor City Council’s controversial approval in May of a 14-story development at East Huron and Division streets. The location abuts an historic neighborhood to the north.

Whether one welcomes or recoils from recent developments, Ann Arbor’s skyline is certainly changing. So are the streets below. As the towers began to rise, knowledge companies like Google and Barracuda Networks came downtown. Experts like Allen suggest that students, who have increasingly shunned the automobile (which frees up money for rent, after all), may be drawn to this modern blend of congenial employment, full-service residential living, and a pedestrian-friendly downtown after they graduate, further contributing to Ann Arbor’s economy.

“Adding a lot of density to downtown will improve the sidewalks, the shops, and the overall vitality, creating a downtown culture that attracts these students to stay as graduates,” says Allen. “High density is what makes great cities, whether it’s Chicago or New York or Ann Arbor.”

Tell us about your experience as a college student living in Ann Arbor.

COMMENTS

  • Scott Kashkin - 84

    Seems a bit that A2 is taking over as the hub of SE Mich from Detroit.

    I can see how some are afraid the town will lose some of its charm. I can see how this might be a necessity given the economic state of the world and Michigan.

    When I was at UM, the town seemed a bit too small, but I’m from New York City, so don’t go by me.

    They probably should limit this to certain parts of town and not too close to campus or old downtown.

    Reply

  • Corinne Land

    I really dislike the changing skyline. Most of the tall buildings lack taste and look like huge corporate boxes, stamped out of tired blueprints. It’s a shame to see a cute and unique town transform into a place that looks like everywhere else.

    Reply

  • dory leifer - 91

    I come back to AA from SF every year to visit friends. The density may be practical but the commercial side was permitted without any consideration to style consistency creating a city of frankenbuildings.

    Separately, students already have very little exposure to real life, having spent their elementary years confined to play dates, high school activities scheduled by parents and now they are dropped in posh high rises at college. Gone seem to be the days that four students who hardly know each other, get the experience of moving into a crappy place with no AC because that’s what they can afford and turning it into a home together.

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  • Robin Wilson

    I am not a fan of the changing skyline. As often the case with developers, they forget about things like the impact on commercial rents for long-established businesses, the “canyon-effect” as it impacts access to sunlight for our beautiful tree-lined and gardened city, and other effects. Their myopic view is quite troublesome and erases much of the unique charm of Ann Arbor. Just ask the owners of Seva, being forced to leave their location of 40 years to move out to a sanitized strip mall on the westside of town; Why destroy the very character of a community that made it attractive in the first place? Muddle headed thinking.

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  • James Mercier - 2003

    I’m not a fan of the high-rises. I am skeptical that there was really a great demand among students for these complexes. They are definitely changing the character of the city and making it feel more impersonal. Look to Evanston, Illinois for an example of what Ann Arbor could be down the road; it’s basically one high-rise after another. I’m concerned that that’s where we’re headed.

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  • Mike Simo - Student from 2006-2012

    As a recent grad who happened to stick around A2 for a bit before returning to NY, I can definitely see similarities between what is desired between recent graduates with high-paying jobs here in NYC and college undergrads @ umich. The only thing is, a lot of people I know who have luxury apartments here in NY have been working a couple of years for high-paying firms either as accountants, I-bankers, etc. Of course, the rents are much higher here, but luxury definitely seems to be on the mind of many recent grads, and, when looking at Ann Arbor, also on the mind of many students. The things is, and we all know this: students don’t have money. As a student who worked 30+ hours a week throughout my college years, luxury living always remained something I felt I could achieve years down the line with hard work and effort. As a screen arts and culture graduate, I now realized I probably won’t ever have a luxury apartment unless I work very hard for the next five years or so. I’ll be 30 years old by then. The point I am trying to make is that there are many students in Ann Arbor in my previous situation: working to make enough to supplement housing and food costs. I never lived in luxury apartments and would have never been able to. My rent ranged from $450 to a max of $600 I dished out one fall semester since I knew I’d be studying abroad the next (I wouldn’t have been able to afford it if I had stayed all year). I think these buildings are going to create, if they already haven’t to some extent, greater social inequalities amongst students. I have no problem whatsoever with students whose parents can afford such high rents ($1000-$1800/ month), and luckily Ann Arbod is such a laid-back town that most students (and I hope this stays this way) won’t feel superior in any way and still socialize with those who can’t afford such luxurious living. But things have certainly changed since the days of waiting until September 1st to sign leases with the best deals on the street-level. You used to have to fight for the best housing. If you were too late in the game, you either got shafted in rent or ended up in a hole-in-the-wall type of apartment and oftentimes farther from central campus than you would have wished.
    I believe the people and culture of Ann Arbor will stay true to being diverse and accepting, and that there will not be any social disparities, but with all the new high rises, it’s definitely something to worry about at least a little, at least if I were part of the University’s Administration.
    Also, the days of the dorms are not the same. The dorms was what made students feel equal and brought students from all types of backgrounds together. My freshman year roommate and one of my best friends came from Dubai, for example. I am not so sure this circumstance is as likely given the current situation. Unless the University requires freshmen to live in student housing, I think some of the student ideogy is going to change on campus. But hey, maybe this is all for the best.

    Here is just one other point to consider. It isn’t only the private real estate companies doing this. The university is as well. I was able to witness the first 1.5-2 years of North Quad, and I can say from my experience and from what I’ve learned about it from the people I knew living there and people I’ve talked to about it: it seems that like the high rises, the majority of people living in north quad come from families who can afford it. north quad is also very expensive compared to halls like Lloyd and Markley, and most students cannot afford it.

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  • Christine Zugaro - 2013/2014

    Must be nice to be a student who can afford a $1,000-$1,800 rent per month. Not me. I think it says a lot about a person who is smart enough to attend a college such as UM but who also is modest enough to live like a “normal” college student.

    Reply

  • David Somers

    It’s about time Ann Arbor shed the brutality of nostalgia. My grandparents went to high school when Ann Arbor High was in the Frieze Building. When my grandfather heard of plans for its destruction, his reply was ‘it served its purpose.’

    I often felt that it was the higher-income newcomer who sought to keep Ann Arbor a quaint little town as it fit their imagined profile in contrast to a sterile suburb. However, I think it’s critical not to hold back the potential it could serve to the resurgent Southeast Michigan economy and culture. There is plenty of room to grow up.

    Reply

  • Bob Bell - 1954

    I am very disappointed in what I see and the direction being taken in addressing the housing problem in Ann Arbor. Students don”t have to live on campus to enjoy the benefits of the neighborhoods!!In fact……neighborhoods are being destroyed to make room for these ugly structures!! The neighborhood of S. University and Forest was special to me and to the University but no longer is. Ann Arbor is becomong like Chicago, Detroit and other big cities and the decisions to go this route are wrong and will be regreted in the future.

    Reply

  • M. McClune - 1955

    I don’t like it at all. One of the reasons that New England colleges and universities are so attractive is that they build (for the most part) in a style that is compatible with the old buildings. Also, it seems to me that U of M is just adding to divide among Americans between the rich and the rest of us – another example of the 1% being catered to.

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  • Ramona B - 84,11

    The charm of the 1970s and early 80s has been gone for some time, so we might as well embrace change….

    Reply

  • Paul Dembry - 1981

    I lived in Couzens for two years. The room did what it was supposed to do. The food service was fine, it kept me alive. I was not there for the experience, I was there to get my engineering degrees. Too many people consider university life as a four+ year resort vacation. Fortunately these new residence buildings are privately held (best of luck to them) so it’s not the tuition payers who are footing the bill. There is more than enough froo-froo waste on the part of UM which is why tuition has exploded in the last thirty years.

    Reply

  • John Floyd - Master of Public Policy, 1987

    Piling up undergraduates in unattractive towers doesn’t seem to have much to do with “Density”, if your goal is to end families living in Scio Township subdivisions. Families – the units that drive “Sprawl” – will never live in these private student dorms. This new student housing, on the other hand, will not vacate enough WWI-era homes to have much impact on the purchase price of a Burns Park home. The 413 Huron high rise will not make The Old 4th Ward more attractive to families.

    I am both a native of Ann Arbor who lived in Chicago after college, and a current resident of Ann Arbor. Recognizing the draw of Charm is different from mere nostalgia. Name-calling by those who like drab tall buildings, built on narrow streets with narrow sidewalks, does not help civic discourse on this subject.

    Our Mayor has spent years trying to destroy the things that make Ann Arbor’s built environment unique, in the name of “Progress”. Now that he has had much success at this destruction, his “Overbuilt” comments seem like crocodile tears

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  • Patrick P. - 1963

    I returned to Ann Arbor last fall for a visit after being away for more than 20 years. I have to agree that the bland, architecturally uninspired high rises I saw will lead to just another American suburb of”ticky-tacky” boxes that Tom Lehrer sang about in my era. Why can’t the designers of multi-dwelling structures be more creative…Yes, do so even if you have to use more land and incorporate landscaping, an architectural “look” (think Cook Law Quad) and a 6 floor height limit, for example. Maybe I’m too nostalgic, but I hardly recognized AA, but the central campus looked the same…and it looked good. P.

    Reply

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