Two Library Lot Proposals Eliminated

Committee: Insufficient financial benefits to the city

 This rendering shows a proposal by Dahlmann Apartments Ltd. for a project called Ann Arbor Town Square. It was one of two proposals for the development of Library Lot that have been eliminated from further consideration.

Two of the six proposals to develop the top of the Fifth Avenue underground parking structure – known as Library Lot – have been eliminated from further consideration.

At a Friday morning meeting, members of a committee that’s overseeing the Library Lot development cited insufficient financial benefit to the city as the reason for taking Ann Arbor Town Square and Ann Arbor Community Commons out of play. Both of those projects would put primarily open space on the 1.2-acre lot. Three of the other proposals include a hotel, with the fourth focusing on housing for senior citizens.

Developers of the four remaining proposals will be scheduled for interviews throughout the day on Wednesday, Jan. 20. It’s possible that the field will be thinned even further before then, depending on how developers respond to a list of questions that committee members have formulated about each specific proposal.

The Jan. 20 meetings will be open to the public. The city also plans to hold an evening open house on Jan. 20 for the public to meet with developers and give feedback on the proposals.

In addition, the committee on Friday discussed the possibility of the Ann Arbor Downtown Development Authority paying for a consultant to help evaluate the remaining proposals.

Project Criteria: Financial Benefit

At Friday’s meeting of the RFP advisory committee, Jayne Miller – the city’s community services director – reported on results from a technical review committee that had evaluated six proposals submitted to the city in mid-November. They looked at whether the proposals met three criteria, as described in the city’s Request for Proposals (RFP):

1. Beneficial use of the site. Any proposal for this site must demonstrate a clear benefit to the community and be consistent with the recommendations of the Downtown Plan, and A2D2 initiative. Preference will be given to proposals that incorporate a use (or uses) that provides a publicly available service to the community, for instance, building or open space that may be used for public meetings, recreation, or civic/ cultural events.

2. Environmental benefits. The development proposal should incorporate to the greatest extent possible environmentally sensitive design and energy efficiency features that follow Leadership in Energy and Environmental Design (LEED) standards. In addition, the project should propose innovative and environmentally friendly runoff water management and seek to improve water quality.

3. Financial return. The proposal must provide a positive financial return to the City. In the absence of other considerations, the City has a fiduciary responsibility to obtain fair market value upon the sale of City assets. Long-term lease or other property arrangements will be considered, but must meet this financial return criterion.

Miller said that neither the Ann Arbor Town Center proposal nor the Ann Arbor Community Commons met the criteria of a financial return to the city.

The Ann Arbor Community Commons – proposed by a group of residents that include Alice Ralph and Alan Haber, who attended Friday’s meeting – identified the need for public funds, Miller said. The proposal for Ann Arbor Town Center, submitted by Dahlmann Apartments Ltd., offered to pay the city $2.5 million, but did not identify funds for ongoing maintenance. Miller said it’s also unclear what the actual cost would be to develop the Town Center project – a proposed urban park with a plaza and ice rink.

City councilmember Stephen Rapundalo (Ward 2), who chairs the RFP committee, said that the criteria of financial return was of utmost importance to the council. That sense is heightened by recent developments in the city budget, he said. [See Chronicle coverage: "Ann Arbor City Budget: Cuts Begin Now"]

“There will definitely be no public funds available for this project, should it move forward,” Rapundalo said. Council had been adamant that the project be cash neutral or cash positive, he added. He also noted that Ann Arbor Community Commons and Ann Arbor Town Center didn’t meet some of the other qualifications they were looking for, including ongoing experience with public-private partnerships.

Eric Mahler, a committee member who’s also on the city’s planning commission, said in addition to the financial benefit issue, projects that were exclusively open space brought up safety concerns, especially at night.

Several other committee members voiced agreement, and the group decided to eliminate the Ann Arbor Town Center and Ann Arbor Community Commons proposals.

The remaining proposals are:

  • A hotel, meeting space, restaurant/retail complex proposed by Acquest Realty Advisors of Bloomfield Hills.
  • “The Fifth a2″ proposed by Jarratt Architecture of Ann Arbor and South Lyon – a mix of hotel, meeting space, condos, and restaurant/retail.
  • “All Seasons of Ann Arbor” proposed by Beztak Land Co. of Farmington Hills – a complex of apartments for senior citizens, restaurant/retail and office space.
  • “Ann Arbor Town Plaza Hotel & Conference Center” proposed by Valiant Partners of White Plains, N.Y. – a hotel, conference center, condos and restaurant/retail.

[Link to city website with .PDF files of all six proposals.]

Bringing on an Outside Consultant

Susan Pollay, executive director of the Ann Arbor Downtown Development Authority, is a member of the RFP committee that’s reviewing the Library Lot proposals, as is John Splitt, chair of the DDA’s board. At Friday’s meeting, Pollay reported on a discussion that took place at a recent meeting of the DDA’s partnerships committee.

That group – which includes city councilmembers Margie Teall (Ward 4) and Sandi Smith (Ward 1) – talked about the possibility of the DDA paying for a consultant to help evaluate the Library Lot proposals. (Teall also serves on the Library Lot RFP committee, and attended Friday’s meeting. Smith serves on the DDA board, in addition to the city council.)

Some members of Ann Arbor’s Library Lot RFP advisory committee at a meeting on Friday morning at city hall. From right: Stephen Rapundalo, Roger Fraser, Sam Offen, Eric Mahler, John Splitt, Susan Pollay.  (Photo by the writer.)

The DDA partnerships committee identified several ways that a consultant could help, Pollay said: 1) evaluating whether the Library Lot proposals make financial sense, including whether it’s likely that the developer could get financing for the project; 2) assessing whether the developers are financially solvent, including what other projects they might be committed to already; 3) helping city council understand the timing of the project, and to make choices about a realistic timeline for developing the site; and 4) researching similar projects in similarly-sized communities. Some of the proposals cited comparisons to Chicago’s Millennium Park or San Antonio’s River Walk, Pollay said, which would not be realistic comparisons to a town the size of Ann Arbor.

If the RFP committee agreed, Pollay said they could bring a grant request to the DDA’s next board meeting. The DDA board meets at noon on the first Wednesday of each month – its next meeting is on Jan. 6.

Stephen Rapundalo said that in looking at the proposals, he realized that at a certain point, assessing them sufficiently goes beyond his expertise. He also wondered whether a consultant would be useful to help the developers flesh out certain aspects of the proposals that the RFP committee might identify, such as the public benefit component.

Committee member Sam Offen asked whether the city had anyone on its staff that might serve the same purpose. City administrator Roger Fraser said the city doesn’t have anyone with the kind of private sector experience they’d need. It would be useful to have someone with that kind of expertise representing the city’s interests, he said, considering what’s at stake.

Offen expressed concern over giving the DDA more power, if it financed a consultant. He wanted to make sure the DDA didn’t get “an additional vote at the table.” Pollay likened it to the grant that the DDA provided to help pay for the Calthorpe report – the city managed that initiative, but the DDA helped pay for the consultants that worked on it. [The DDA provided $175,000 for that project.]

Rapundalo suggested getting a firm or a team that could draw on expertise in several areas, from finance to architecture to real estate development. He also wanted someone who could help the city with a public engagement process. When Offen said it might be better to have someone locally handle that aspect, Fraser said that the city was short-staffed and could use someone to help manage the process.

Pollay said she also assumed that to avoid the appearance of a conflict of interest, they’d want to look for someone outside of this area and who wasn’t connected in any way to the developers making proposals for the Library Lot.

Eric Mahler said he was growing skeptical of finding a firm with all of these qualities. “If we do find that under one roof,” he said, “it ain’t gonna be cheap.” No dollar amount for the consultant was floated at Friday’s meeting.

The group discussed when to bring in a consultant, assuming that the DDA approved the funding. They agreed that Pollay and Miller would work up a request for qualifications (RFQ), and ask for candidates to respond by Jan. 5. The information would be forwarded to the RFP committee members before their next meeting on Jan. 8.

Also at the Friday meeting, the RFP committee decided to schedule presentations for the four remaining proposals on Wednesday, Jan. 20 – tentatively to be held at the Community Television Network (CTN) studios on South Industrial. The plan is to give each developer 90 minutes, including 30 minutes for a presentation, 30 minutes for questions from committee members, and 30 minutes for questions from the general public.

In addition, an open house for the public to meet with developers of the four proposals is tentatively planned for the evening of Jan. 20 at the downtown library, 343 S. Fifth Ave.

What about the Library?

Stephen Rapundalo asked if anyone had talked with leaders of the Ann Arbor District Library to get feedback on the proposals. The library’s downtown building is located adjacent to the proposed development, where the DDA is currently building an underground parking structure.

John Splitt reported that the library board planned to discuss the proposals at their meeting on Monday, Dec. 21. Jayne Miller asked if the board planned to share their feedback formally with the city. Saying she didn’t know the answer to that question, Susan Pollay noted that the library is the most significant property that faces the site, and that whatever development goes there will likely affect future plans that the library might have to rebuild its facility.

The agenda for Monday’s library board meeting allots an hour to the discussion of Library Lot proposals. The board packet includes a list of questions that Pollay provided to library director Josie Parker, from a discussion the two of them had earlier this month. In a note to board members, Parker wrote that the board might find the questions useful as they review the Library Lot proposals. Here’s a summary of the questions:

What are your thoughts about proposals that would bring restaurant or retail uses on the first floor? Design considerations? Kinds of businesses to be considered that would complement the library? Hours of operation?

What are your thoughts about proposals that would bring hotel rooms and conference/meeting space to the library lot? Peak activity hour conflicts with the library? Types of users? Potential benefits or negative impacts to the library?

What are your thoughts about proposals that would use the entire site as open space? Active versus passive uses? Maintenance/management? Potential benefits or negative impacts to the library?

The city established that at least part of the site should be used as a public plaza. What are your thoughts about how this portion of various projects should be developed? Do you have design concerns/ideas? Programming concerns/ideas?

At Friday’s meeting of the RFP committee, Sam Offen reported that he had attended a University of Michigan Ross School of Business class on Monday taught by local developer Peter Allen. Students had made presentations of proposed developments that they’d worked on during the semester – including two teams who designed developments for the Library Lot. He said he’d been impressed by those presentations, and said he hoped that the developers’ presentations would be as impressive.

Allen’s students also made presentations to the library board on Thursday evening. The Chronicle attended that meeting, as well as Monday’s class, and will be reporting on those presentations in a future article.


  1. By Bob Martel
    December 18, 2009 at 5:26 pm | permalink

    The scope of consulting services they are talking about is quite broad and as previously indicated not likely to exist “under one roof.” I agree that the disposition of the Library Lot is a big decision for our community and should be made carefully and with credible analysis. A consulting firm should definitely be employed since, despite the capabilities of the folks already involved, we simply do not possess the expertise in house to evaluate the proposals and make recommendations to City Council. In my opinion, the City should have already hired a consultant to assist with the entire RFP process and recommendation process, but that is water under the bridge. Certainly the identification and selection process for the consultant needs more time and thought than can be provided in the proposed time frame. This is not like buying twenty cases of toilet paper. To expect competent firms to be identified, an RFP prepared, and proposals prepared in time for a January 8th meeting is completely unrealistic.

  2. By Tom Whitaker
    December 18, 2009 at 6:35 pm | permalink

    Two things:

    1. They are just now figuring out that they don’t have the expertise to analyze these proposals? Really? No one thought aboutatwhen they were writing the RFP? Why on earth does the City keep trying to get into the public-private partnership business if no one has any idea what they’re doing? If this was the first time, I suppose we could understand some missteps, but this is the third time that I’m aware of. 415 W. Washington never materialized into a project, and the YMCA lot is now the subject of a lawsuit. Have they learned nothing?

    2. Two proposals with huge public (i.e., taxpayers,constituents, voters) support have now been taken off the table by a small, hand-picked group of insiders, with no public input. This is exactly what Mike Anglin and others feared back when this RFP was authorized. Will public participation in this give-away of City land consist of being marched past two renderings: Conference Center A and Conference Center B?

  3. By UM88
    December 18, 2009 at 8:32 pm | permalink

    Funny how the project with the highest number votes (though informal) has been eliminated.

  4. By Pete
    December 18, 2009 at 11:04 pm | permalink

    What a shame that having a few hundred square feet NOT dominated by high-rise isn’t considered beneficial. Not only that, but plantlife and open air is infinitely more environmentally friendly than said high-rises, no matter what level of LEED they qualify for.

    Even financially, who can say whether making the city more attractive wouldn’t have as much or more financial benefit, albeit indirect, as making another (sigh) conference center/hotel.

  5. By Tom Whitaker
    December 18, 2009 at 11:31 pm | permalink

    Why was this statement not included in the RFP? And if it’s true, why were the two hotel/conference center proposals that involve the use of public money not tossed out at this meeting?

    Both proposals expect the City to pay to build its own conference center, either on the same spot or across the street on the Y lot. And as the Valiant boys say in their own proposal: “…Conference Centers rarely generate enough revenue to cover debt…”

    Are we seriously thinking of bonding yet another huge capital project on shaky financial projections? Are we seriously going to toss out a $2.5 million gift from Mr. Dahlmann with no public discussion? Unbelievable.

  6. By Tom Whitaker
    December 18, 2009 at 11:33 pm | permalink

    Re: (5), This is the statement I was referring to:

    “There will definitely be no public funds available for this project, should it move forward,” Rapundalo said.

  7. By jcp2
    December 18, 2009 at 11:36 pm | permalink

    It’s hard politically to support developing a park when being critisized for putting in a giant water fountain in front of a controversial new City Hall, all while laying off firefighters.

  8. By jcp2
    December 19, 2009 at 12:48 am | permalink

    Oops, spelling error above, should be criticized. Darn texting non-smartphone!

  9. By suswhit
    December 19, 2009 at 7:46 am | permalink

    Well honestly, my heart sunk when I read this piece. I shouldn’t be surprised, though. And no one should be too surprised when they ultimately decide that the “best” proposal is the one our leaders secretly agreed on some time ago. Despite their denials — which seem pretty ludicrous now since the proposal actually states how long one group has been working with the city and it’s curiously longer than the supposed timetable. Doh.

    And as far as jcp’s comments go. Certain people think a million dollar decoration at the entrance to city hall is ok, but a park that will benefit anyone and everyone is not? Give the DDA Liberty Plaza to build, build, build and give the citizens an ice skating rink downtown on the library lot. And while they are at it, they could use that million on art at Town Square instead. Can one not see the difference between a sculpture stuck next to the sidewalk on Huron Street and a place for people to gather in the heart of town? You want Ann Arbor to be a little Chicago? Here’s your chance. Grab it! A destination that will bring people downtown who will park in the new underground parking lot and then shop, eat, drink. Hurray! The site could even be self-funded if the city leased out space to the right vendor.

    A hotel/conference center/apartments for which there is no market sounds like yet another City Hall “fail.”

  10. December 19, 2009 at 8:21 am | permalink

    I had the same thought, suswhit. The Dahlmann proposal had a lovely water feature in it that the Percent for Art moneypot could be applied toward if such is really needed.

  11. By jcp2
    December 19, 2009 at 9:09 am | permalink

    Actually, I like the public plaza idea. It’s just that I think that City Council feels like it’s under siege from all the negative feedback it is getting now, so that the last thing it is going to do is to support any endeavor that does not have an immediate direct financial benefit to the city. If the general message now is government austerity is needed, then park development doesn’t really fit in. Think of McCain’s ridicule of the Adler’s purchase of a new planetarium projector. It was phrased as $3 million for an overhead projector. Wrong, but effective.

  12. December 19, 2009 at 9:29 am | permalink

    For those folks keeping score at home, the language to which Suswhit is referring comes from the introduction to Valiant’s proposal: “For well over 18 months we have been meeting with institutions, businesses, public officials, individuals nd focusgroups throughout the Ann Arbor community to determine what is the type of project that will best meet the needs of the City and the broader community.” “Well over 18 months” would be some time in early 2008.

    In January, 2009, City Administrator Roger Fraser showed Council members some drawings of a Valiant proposal at a retreat. A FOIA request for them was denied.

    Then, several months ago, Vivienne Armentrout revealed the Valiant “secret plan” which had been circulating in City Hall. She later posted part of that plan verbatim. They are similar to the final Valiant proposal.

    I wonder when Valiant first met with “public officials”, and who they were.

  13. By Gill
    December 19, 2009 at 10:36 am | permalink

    I like the idea of an ice rink downtown, but NOT on top of an underground parking structure. The cost per square foot for open space on top of a structure makes it yet more of a waste of money. If the people decide they want the ice rink here, and on no other lot downtown, then do not install the underground parking.

  14. By Joanne
    December 19, 2009 at 11:15 am | permalink

    Ann Arbor wants green space but doesn’t want to build a green park on top of the parking lot? Of course. Such shortsightedness. They want a building that can generate property taxes instead of supporting the mayor’s idea of creating green space, or creating a much needed downtown park (aside from Libery Plaza),or a nice place for people to sit with the book they just received at the library.

  15. By mr dairy
    December 19, 2009 at 11:51 am | permalink

    The “secret plan” is scam to give public land to private developers and the payback with future parking money is dubious at best. The city, especially Roger Fraser lied when he/they denied that there was a plan and discussions.

    Who will be complicit in this scam?

    The fix is in.

  16. By Karen Sidney
    December 19, 2009 at 1:31 pm | permalink

    The Committee has an odd idea of financial return if they are rejecting $2.5 million.

    I don’t think the city needs another consultant, especially the hired gun variety they seem to favor. What they need to do is listen to the citizens.

  17. December 19, 2009 at 1:46 pm | permalink

    Mr Dairy, when did Roger Fraser deny there was a plan and discussions? Can you provide his exact words?

    This is important.

  18. By Rob
    December 19, 2009 at 8:26 pm | permalink

    It’s ironic, but with the demise of the newspaper and the necessity of reading our twin on-line editions, I feel that I have a lot more insight into what is happening within city government. To put it bluntly, I’m not pleased. I’m going to vote against every incumbent in city hall the next primary (since we only have one party). Project after project seems ill conceived; I’m particularly concerned with the long term vision of the city leaders at this point — especially their fanaticism with density. I’m sure that the current RFP process will leave us with another ugly underused monstrosity smack in the middle of downtown.

    I’m concerned that the decision process is too narrowly focused around financial return of the specific site. My main concern with most of the city’s decisions are that they are all ‘fine’ within a vacuum, but when looked at through the lens of the city as a whole, are found lacking. It may be that the business plans for the open space responses show neutral to break-even profitability versus the four ‘winners’ that I’m sure have been ‘optimized’ for site-specific profit. However, I’m certain that in the long run, building a downtown area where people want to be is the smart financial play.

    I like Gill’s simple solution above: cancel the underground parking lot project and put in the park with water feature/ice rink.

  19. By Christopher
    December 20, 2009 at 9:50 am | permalink

    Where is the specific information on which plans will bring in more revenue over time? The committee must have done more than just hand-waving on this question. What information did they use? Did they just make things up? What’s on the record?

    I hope that the people thinking about fiscal responsibility took indirect revenue (and indirect expenses) into account when they put together their long-term financial projections.

  20. December 20, 2009 at 4:06 pm | permalink

    Christopher, those are the questions the consultant will presumably answer. But they didn’t look at beneficial financial impacts of the open space proposals before eliminating them.

  21. By Lisa Dengiz
    December 22, 2009 at 1:34 pm | permalink

    How sad that the wise words and sentiments of the citizens are once again rejected and relegated to the business- as- usual back room politics. More of the same….

    The ice rink/slash summer green space and gathering area that Dahlmann ( do not know him) graciously offered to fund- think Martias Park in Detroit, Rockerfeller Plaza, and much of visionary, cultural development of downtown Chicago- would have been a lovely draw for townies, tourists, business and university folks that would happily spend more time and revenues downtown.

    Seems we are still lacking a downtown cultural vision/space.

    Back to the drawing board, kind folks.

    But please, can we forgo high paid consultants which our leaders often seem to ignore anyway?

    Can we ask the UM or other bright stars/ citizens that reside here to volunteer their time and energy to help fill the current fiscal /vision gap? After al, they have the most to gain- and lose.

    Thank you!

  22. By David Lewis
    December 22, 2009 at 2:14 pm | permalink

    Lisa: If you read the article on the caucus meeting you will see that there is a willingness (3 council members) to hear the proposals the committee tossed out. The city council will have the final say, not the committee.

    A consultant paid for by the DDA seems wise in this case. The UM won’t volunteer people with expertise in real estate finance in part because they don’t have anyone who does it daily.

    I do wonder if the city can possibly support a park on this site and the Greenway Parks. Seems like the city needs to choose one or the other and that it would still be a stretch.

  23. By Rod Johnson
    December 22, 2009 at 6:58 pm | permalink

    Seems like one of the few successful uses of Liberty Plaza has been music. It would be great to develop a space downtown where bands could play outdoors in a pleasant setting. A couple summers ago, driving back from out west, I stopped for the night in some Illinois town that had a public square right in the middle of town with a little bandshell/gazebo, and a band (the oompah kind) was setting up to play and half the population of the town must have been there with blankets and picnic baskets (then an enormous thunderstorm hit, which added another whole level of public participation, but that’s another story). It was great.

    The more open visions for the library lot would be ideal for this. Skating rinks are nice in the winter, but what about summer? Imagine the West Park bandshell, but downtown and a central part of city life. Wouldn’t it be cool to see music, speeches, plays, dances, weddings, hootenannies? We don’t really have a public space like this downtown, and I think we suffer for it. (If the library lot options are foreclosed, at least think about reconfiguring Liberty Plaza to lower the suck quotient for music.)

  24. By Lisa Dengiz
    December 22, 2009 at 7:02 pm | permalink

    Thanks for clarification, David.


  25. By John Floyd
    December 24, 2009 at 12:40 am | permalink

    Downtown Ann Arbor has no “there” there. The last time it had a central spot seems to have been when the old county courthouse was torn down to make way for the current one. The town square/gazebo concept, altered to fit a community of our size, gives a sense of place to
    Ann Arbor.

    Again, if the city envisions adding 10,000, 20,000, or 30,000 new residents in central Ann Arbor, where are they going to walk their dogs or throw a frisbee? Cramming several thousand more residents to the middle of town, without making any provision for park space, is not recipe for long-term success.

  26. By jcp2
    December 24, 2009 at 10:50 am | permalink

    Dog walking will take place on the Allen Creek Greenway, if dogs are still allowed. I hear that their carbon footprint is greater than a car. Frisbee throwing will be at the fields in Fuller Park, the Arb, or on the Quad. Helmets and mouthguards mandatory, of course.

  27. By Anon
    January 6, 2010 at 4:48 pm | permalink

    How many parks does a city the size of Ann Arbor need? This space is just around the corner from the Liberty Square and I can honestly say that I have entered that space maybe two times in the 20 years that I’ve lived here.

    On the other hand, I have tried to organize meetings and conferences for my organization in downtown Ann Arbor and have been stuck dealing with the Campus Inn and the Bell Tower, and neither have ever been able to accommodate large group meetings. Clearly, fact that the Dahlmann Group was pushing for a park was to limit competition from other hotels. Ann Arbor needs a solution that will generate income for the city.

  28. By Ecarter
    January 24, 2010 at 12:13 pm | permalink

    I like the idea of a park in the center of town, at this time however, there are several beautiful areas that encompass a more continuous space for play. It is wonderful how the people of Ann Arbor want to keep as much green space as possible, but if one were to think clearly it would, in time just be an expensive liability instead of something that generated employment and city revenue. Additionally, if the city were really concerned about green space and revenue they might consider a plan that included both a green space and a structure, which would take care of most of the the requirements for construction to begin. This would help the local economy, create new employment and maybe a new center of activity would rise in that space that would attract new people to the area further enhancing the cities progressive, not regressive attitude to change.