Transitioning the Ann Arbor Chamber

John Hansen’s title on his business card is “Transitionist” – and he isn’t kidding. Hansen has been on the job only a few days as interim president of the Ann Arbor Area Chamber of Commerce, but he’ll be shepherding what could be a significant physical transition too: A possible move out of the business group’s third-floor offices at 115 W. Huron St.

On Monday, the chamber announced plans to sublet all or part of its 6,300-square-foot warren of offices. There’s too much space for the 10 or so people who work there, Hansen said, and they’re paying too much for it. He declined to say how much, noting only that “it’s very expensive” – the biggest cost after payroll in a roughly $1 million budget.

The Chronicle talked to Hansen on Monday about both transitions: The possible move, and the process of choosing a new leader for the 1,200-member group. Along the way, we learned a few things about what it’s like to be a state legislator and school superintendent, too.

No, Really – He’s Interim

Hansen doesn’t blame people who might think “interim” means “trial run before taking the job full-time.” That was the trajectory of Jesse Bernstein, who was brought on as interim in the spring of 2006 after former president Sabrina Keeley’s departure. Bernstein was hired permanently that fall, but resigned in June of this year.

Over the past few years, Hansen has made a career out of being the go-to interim guy. His first career was in education – he served as superintendent of Dexter Community Schools from 1984-1998. In 1998 he ran and won a race for state representative from District 52, an office he held until 2002. In the 1998 Democratic primary race for that seat, he defeated Larry Kestenbaum, Pam Byrnes and Rebekah Warren.  All three of them now hold elected office – in contrast to himself, Hansen notes wryly.

Hansen took his first interim job in 2003 after leaving the legislature, as superintendent for Willow Run Community Schools in Ypsilanti Township. He’s had several more gigs since then, mostly – but not all – in education. The chamber is his seventh interim job – and he’s clear about not changing his “Transitionist” title.

The end date for him is Jan. 1, 2010 – assuming the chamber’s board has found a replacement by then. They’re forming a “vision committee” co-chaired by Debra Power and John Petz, who both serve on the board’s six-member executive committee.

That group will meet in September and focus on big-picture questions, looking at what kind of organization the chamber should be in the future. The answers will shape the eventual job posting for a permanent president, Hansen said, and they’ll serve as the standard they use to screen applicants “so we’re not just evaluating people on their warm smile.” A not-yet-formed search committee will handle that part of the process.

The issue of office space could also be informed by the answer to “What will be chamber be?”

What Does the Chamber Need?

When The Chronicle spoke to Bernstein upon his departure in June, he cited the chamber’s move into new offices – they were formerly located in the DTE building, at the corner of South Main and William – as one of his accomplishments. He felt the new space presented a more inviting, professional image for the chamber – and it does, Hansen says. “I would have been proud of that, too.”

But conditions have changed since 2007. The economy tanked, for one thing. Chamber membership is down, but the lease expense is locked in until 2017. In fact, the conversation about how to address this problem pre-dates Hansen. For the past six to 12 months, the board and staff have been looking at whether the amount and cost of the office space they have matches their needs, said Newcombe Clark, a chamber board member and local real estate agent who’s taking the lead on finding a sub-lessor.

The chamber’s asking rate of $18.75 per square foot, plus utilities, is close to what the chamber itself is paying, Clark said.  [Based on the 6,300 square feet of space, that would put the chamber's costs at close to $118,000.] There’s typically a 15-20% gap between the asking rate and the final deal, Clark added, but that gap has been ballooning. Landlords are cutting great deals because there’s so much vacant space on the market. Rates are especially low on the south side of Ann Arbor, Clark said – that’s why it’s unlikely that the chamber will find someone to sublet the entire space. That, plus the fact that “there’s not a lot of 6,300-square-foot tenants out there,” he said.

So how much space does the chamber itself need? They’ve enlisted architects to do some space configuration analysis, to get a better idea of the square footage they’d need. In addition to the chamber’s own people, staff from the getDowntown program and SCORE (Service Corps of Retired Executives) work out of the current space. There’s also a room with five workstations – or “hotels” – that are available for chamber members to use on a temporary basis.

In fact, the hoteling and co-office concept is an intriguing one for Hansen. As part of his outreach to get to know board members, he’s been meeting them one-on-one at their offices. He met Clark at the bare-bones offices of Ghostly International on Maynard Street. The office condo is owned by Clark, and in addition to housing Ghostly, it’s used as temporary office space for freelancers and others working on collaborative projects – essentially, there are tables and places to plug in your laptop. Until recently, Clark has worked out of there, too, though Hansen jokes that “his place of business seems to be on his feet.”

Then Hansen read an Ann Arbor Observer article that Kyle Mazurek, the chamber’s vice president of government affairs, had flagged for him – about the Workantile Exchange, a co-working space just around the corner on South Main Street. When Hansen read the description of the Workantile, he thought, “Why aren’t we them?”

The organization has been around for 90 years, Hansen said, and back in the early 1900s, its membership and services were very different than what they became a few decades later, when large corporations dominated. There’s yet another transition taking place, he said, with the “1099s” – the self-employed – making up a larger part of the business landscape. “I happen to be one of those,” Hansen added.

It will be up to the chamber board, in part through the newly formed vision committee, to figure out if the organization needs to adapt in ways small or dramatic. Hansen says he’ll have the “elderly statesman-y role” in this transition – but then, of course, he’ll be moving on.