Midtown Detroit Anchor Strategy
At the height of the Great Recession, the city of Detroit faced tremendous challenges including significant disinvestment, blighted neighborhoods, underperforming schools, and a declining population. The Midtown Detroit Anchor Strategy highlights how Detroit’s anchor institutions – long considered second to the city’s auto-industry – became important catalysts for urban revitalization in a 3.5 square mile district known as Midtown Detroit. This Anchor Strategy deployed the use of housing incentives, a local purchasing program, and the creation of a new community development organization to implement place-based economic development initiatives and projects.
U3 Advisors first began working in Detroit in 2009, when a group of local philanthropies engaged U3 to assess if there was an opportunity for Detroit’s anchor institutions — its Eds and Meds — to have a greater economic impact on the city. Together, Detroit’s three largest anchors institutions - Detroit Medical Center, Henry Ford Health System, and Wayne State University - employ over 30,000 faculty and staff, enroll over 27,000 students, and spend nearly $1.6 billion in goods and services annually. Through a data driven approach, U3 Advisors concluded that there was tremendous potential to capture the anchors’ economic impact within the city, and accordingly created a place-based economic development strategy that defined Midtown as the urban core of the city. Subsequent analysis and visioning resulted in several major initiatives.
U3 Advisors worked with community partners to combine two separate community development organizations and thereby create Midtown Detroit Inc. MDI has become the economic and community development entity for Midtown – working on behalf of the anchors to improve the public realm, attract and coordinate development activity, and leverage non-profit investment. Through the creation of MDI and the anchor programs, Detroit secured a Living Cities Integration Initiative grant that has brought $22 million in investment to the Woodward Corridor in Detroit. MDI has also developed several unique financing tools such as the Woodward Corridor fund to help incentivize development in the neighborhood. For recognition of outstanding neighborhood stewardship, MDI was awarded the ULI Global Award for Excellence in 2013.
In addition to the community development infrastructure, U3 Advisors worked together with the anchor institutions to develop a series of programs designed to leverage their demand. U3 Advisors conceptualized the strategy and managed the implementation of a $1.2 million housing incentive program known as “Live Midtown.” The program provides down- payment assistance, home improvement grants, and rental incentives to employees of the three anchor institutions, and has attracted more than 1100 new residents to Midtown over the last four years. Based on its success, the program has also been adopted by multiple downtown employers. A local purchasing program - Source Detroit – was developed as a strategy to increase institutional purchasing from Detroit based businesses by creating policies and practices for greater focus on Detroit vendors, and by supporting, attracting or creating new businesses to serve the anchors’ needs. This program helped direct more than $1.5M of purchasing to local businesses in its first year, inspired institutions to begin tracking local purchasing, and helped attract a large medical supply distribution facility to the district.
U3 Advisors also created the vision of an Innovation Network for Detroit, identified partners and resource needs, and created programs that have since been implemented by The New Economy Initiative. The Innovation Network finds its physical manifestation in a growing Innovation District called TechTown. U3 Advisors worked with Midtown Detroit Inc. to develop a masterplan for the innovation district in partnership with Sasaki.
Midtown Detroit has undergone a dramatic transformation in the past five years. The neighborhood has seen a 40% reduction in crime, $210M in investment since 2009, more than 1,200 new apartment units added, and more than 150,000 square feet of new retail. Today, Midtown is thriving and is an example of how anchor and philanthropic partnerships and focused economic development strategy can create a vibrant, walkable, district.