Detroit's Temple Street attracting attention from mysterious buyers

**Gistok** · September-11-11, 03:11 PM

Originally Posted by davewindsor

Really?! And who's really paying for it? They want $3.7m for a $100K house in DETROIT and you're ok with that? Ford Field and Comerica Park received a $320m taxpayer subsidy to build it. If Illitch buys this section of the city for the new hockey stadium, guess who's the one that's gonna be paying a good chunk of that speculator's windfall? If the speculator wants to play that game, then they are fair game to an immediate tax reassessment of their property for their ridiculously inflated price IMO. Hell, make it retroactive to when they first asked for that kind of money. You can't have it both ways. If they think it's worth that money, their tax assessment should be based on $3.7m, not $100K.

Dave Windsor... the $320 million in public money to build the stadia was largely from 4 revenue streams... 1) oil/gas leases on state land, 2) hotel tax, 3) liquor by the glass tax, 4) car rental tax.

So a significant piece of this revenue stream is from out-of-state visitors, and drilling rights on public land.

**Gistok** · September-11-11, 03:23 PM

Originally Posted by MikeyinBrooklyn

I also would second the opinion that the Temple Hotel could be closed on vice grounds at a moment's notice; the owner [[and staff and patrons) could all face criminal charges, as well. It exists to serve drugs and prostitution. When Illitch [[or anyone else) wants them out, it'll take 90 days tops.

Bingo!! I absolutely agree with this assessment.

As in the west Foxtown area... the Cass Park area will remain [[as far as the Ilitch's are concerned) undeveloped, and as unattractive as possible, so as not to raise the price of the yet unpurchased land any further.

The Masonic Temple however was too large and important a parcel in the area to let close... so that's likely why the Ilitch's stepped in. They probably didn't want to own it... but wanted it to remain a cornerstone of any future development.

Why wouldn't the Ilitch's want to own Masonic? Property taxes would have been quite high on that massive structure. Not to mention utility and maintenance costs.

**Gsgeorge** · September-11-11, 03:52 PM

Originally Posted by Gistok

When the Eminent Domain process was proceeding by Wayne County for the Comerica Park and Ford Field sites, the Women's Exchange Building [[a beautiful Tudor structure on the Adams Ave. front of Grand Circus Park) was part of the land that Wayne County was going after. The owners balked and went to court over why that parcel next to Central Methodist Church should be included in the Stadia district. The reply was that the Ilitch's were going to put in a "decorative sidewalk" near the Comerica Park entrance. The judge decided in favor of the building owners, and the Women's Exchange [[mercifully) was spared Eminent Domain and demolition.

Well then when the folks owning the Women's Exchange wanted to develop the property for some form of entertainment to complement the stadia... the city told them they needed x amount of parking spaces. Well all the parking spaces nearby [[except for those in the GCP underground garage) were owned by Ilitch. So all development ideas [[one idea was to turn it into a "China Club" restaurant) required the building owners to contact the Ilitch organization to ask about using some of their parking spaces. All requests went unanswered...

... that is until Detroit Red Wing Chris Chelios bought [[or leased?) the building and wanted to turn it into Chelios Chili... and then the Ilitch's became cooperative. But that was after many years of having the building remain undeveloped.

Thanks for that. I was actually thinking this was the building across from Park Bar/Bucharest Grill, I believe it's called the Women's Club or something similar? Do the Illitches own that as well?

**stromberg2** · September-11-11, 04:01 PM

^^^
That's what I thought.

Stromberg2

**Gistok** · September-11-11, 04:05 PM

From a historical perspective the Women's Exchange Building is where Edsel Ford [[son of Henry) first met Eleanor Clay around the beginning of WWI. They were later married and had 4 children... the youngest and only survivor is William Clay Ford Sr. [[father of Ford Chairman), still the owner of the Detroit Lions. One would imagine that perhaps he was happy that the judges ruling went the way it did.

Recently I visited the Edsel & Eleanor Ford House and found that William Clay Ford Sr. is now 86 and getting on in years. He no longer visits the mansion as he used to, and rarely goes to more than the season opener at Ford Field.

**Pam** · September-11-11, 07:04 PM

Thanks for that. I was actually thinking this was the building across from Park Bar/Bucharest Grill, I believe it's called the Women's Club or something similar? Do the Illitches own that as well?

That's the Women's City Club.

http://en.wikipedia.org/wiki/Women's_City_Club

**downtownguy** · September-11-11, 07:36 PM

The Women's City Club is owned by Chuck Forbes, who in the decade before the Ilitches even knew Grand Circus Park existed, started buying up and preserving -- to the best of his ability -- many of the historic structures in the area. I think he bought about 40 buildings all within a 3 year period. When the Ilitches, who had been given a sweetheart deal to manage Cobo Arena and Joe Louis Arena, wanted another venue to "feed" smaller acts to their larger venues, they asked Coleman Young to "persuade" Forbes to sell the Fox to Ilitch. When Forbes balked, and asked why the city didn't just finance his renovation of the Fox [[as they eventually did for Ilitch to the tune of $35 million which included all the infrastructure improvements to the area), the city suggested that the Fox was unsafe in it's current state and Forbes risked having it condemned if he didn't sell to Ilitch. If it wasn't for Chuck Forbes, we wouldn't have a restored State/Filmore Theatre, the Women's City Club, the Colony Club, The Gem/Century Theatre and the Elwood Bar. Many people give Ilitch props for being a preservationist when Chuck Forbes deserves most of the credit for stabilizing that area long before Ilitch came along.

**Gistok** · September-11-11, 10:12 PM

I think that hyphen between "businessman-preservationst" has disappeared from most vocabularies long ago....

Although one does have to give him grudging credit for the Fox [[he spent his own money on the building itself), on saving the Masonic [[had the lights gone out, the Masonic orders would have moved to the burbs... and it would have ended up a scrapper's dream), and at least stabilizing the United Artists complex [[although "too little too late" comes to mind on that one).

But one can hardly become jubilant over the facade stabaization of the former Fine Arts Building.... not yet anyway...

Steve bennet · September-12-11, 12:38 AM

Originally Posted by davewindsor

Really?! And who's really paying for it? They want $3.7m for a $100K house in DETROIT and you're ok with that?

Yes.

If the owners of the property decide to sell, they can charge whatever they want. If the buyers don't want to pay the asking price, than they can choose not to purchase it. If they want that parcel of land bad enough, they will pay the asking price, which therefore makes the property more valuable than the 100k you just claimed.

It's a pretty simple concept. Why are you having troubles understanding it?

**davewindsor** · September-12-11, 01:27 AM

Originally Posted by Steve bennet

Yes.

If the owners of the property decide to sell, they can charge whatever they want. If the buyers don't want to pay the asking price, than they can choose not to purchase it. If they want that parcel of land bad enough, they will pay the asking price, which therefore makes the property more valuable than the 100k you just claimed.

It's a pretty simple concept. Why are you having troubles understanding it?

I think you're having troubles understanding what I said. I don't have a problem with them asking an excessive amount per se. They can ask what they believe it's worth and potential buyers can choose to buy it or not. That's how the free market works. Obviously.

BUT, I do have a problem with speculators who want to have their cake and eat it too. It's not fair for them to put it on the market for $3.7m, yet pay a mill rate based on a market value of $100K since that's what neighbouring properties sold for in the past couple years. If they are asking $3.7m, then they are saying that's what they believe it's worth. Therefore, they should be paying property taxes based on an assessed value of $3.7m from the time they listed it for sale at that price.

Why should city services suffer because speculators are cheating the tax assessors office?

Do you understand what I'm saying yet?

**Django** · September-12-11, 04:46 AM

Originally Posted by davewindsor

It's not fair for them to put it on the market for $3.7m, yet pay a mill rate based on a market value of $100K since that's what neighbouring properties sold for in the past couple years. If they are asking $3.7m, then they are saying that's what they believe it's worth. Therefore, they should be paying property taxes based on an assessed value of $3.7m from the time they listed it for sale at that price.

Why should city services suffer because speculators are cheating the tax assessors office?

Do you understand what I'm saying yet?

I dont agree with that at all. What if the property goes for $1 million down the road instead of $3mill, their supposed to pay taxes for a $3 million building just because thats what they asked for? Im obviously not schooled in property and/or taxes but if I own something that goes up in value I dont think I should be taxed for it, thats just my good luck or foresight. Isnt their a tax ascessor for that job, something like that. The building might not be worth 3 mill but someone may pay 3 mill.

sorry about my spelling, I cant get my spell check to work, uggh!

**downtownguy** · September-12-11, 07:13 AM

Originally Posted by Gistok

Although one does have to give him grudging credit for the Fox [[he spent his own money on the building itself)

I was pretty active with the GCP business association when Ilitch moved into the neighborhood, and 25 years can make my memory a little fuzzy. But, as I recall it, the city [[probably through DEGC) fronted most of the cost to Ilitch. The Fox was a great success from day one, and Ilitch paid off his debt rather quickly, but the same deal could have been granted to Forbes, and wasn't.

**downtownguy** · September-12-11, 07:18 AM

daveinwindsor, I'm with Django. The ultimate value of a property is what it sells for, not what a person asks for it. The marketplace determines its value. And if the buyer believes it is worth that much, then the buyer should assume a higher assessed value and pay property taxes on that.

**casscorridor** · September-12-11, 08:43 AM

Originally Posted by downtownguy

I was pretty active with the GCP business association when Ilitch moved into the neighborhood, and 25 years can make my memory a little fuzzy. But, as I recall it, the city [[probably through DEGC) fronted most of the cost to Ilitch. The Fox was a great success from day one, and Ilitch paid off his debt rather quickly, but the same deal could have been granted to Forbes, and wasn't.

Yeah and now so many people praise Ilitch because he "restored" the Fox, and apologize for all the urban planning atrocities he has committed since.

Imagine how west "Foxtown" would look if it were all filled in with small scale residential and office buildings with retail on the street level. A single parking garage could eliminate ALL the surface parking in the area, and make way for urban-positive development. Maybe Illitch just wants everyone to know this is HIS empire, by tearing everything down, putting chain link fences around the lots, and slapping an Olympia entertainment sign on the fence. Maybe the DEGC uses Foxtown as their ideal development model.

**esp1986** · September-12-11, 09:16 AM

Originally Posted by casscorridor

Yeah and now so many people praise Ilitch because he "restored" the Fox, and apologize for all the urban planning atrocities he has committed since.

Imagine how west "Foxtown" would look if it were all filled in with small scale residential and office buildings with retail on the street level. A single parking garage could eliminate ALL the surface parking in the area, and make way for urban-positive development. Maybe Illitch just wants everyone to know this is HIS empire, by tearing everything down, putting chain link fences around the lots, and slapping an Olympia entertainment sign on the fence. Maybe the DEGC uses Foxtown as their ideal development model.

My biggest worry, is that all of the land that Olympia currently 'maintains' as surface parking stays that way. I fear that Ilitch will continue to use it in this capacity until there is some sort of demand by someone to develop it. Given the obnoxiously large tracts of land amassed together, one little parcel is unlikely to attract a serious developer, meaning only a serious project could ever occupy the land that [[assuming Ilitch actually owns all of the land on either side of I-75) doesn't eventually have an arena built on it.

**hamtown mike** · September-12-11, 09:37 AM

I like the "buyer beware" thinking. That the buyer be placed on the hook for the new value. Forgive my ignorance, is there a sales tax when property is sold? If so, a 3 million dollar price tag will still give the city/state some juice. But does this thinking inhibit investment?

Similar scenario to the guy who caught Mark Maguire's 70th homerun ball. He was looking at a tax bill against the ball's estimated $1 million dollar value. [[He intelligently 'gave the ball back' in exchange for some trinkets and I think dinner with Maguire.)

**bailey** · September-12-11, 10:33 AM

Originally Posted by hamtown mike

I like the "buyer beware" thinking. That the buyer be placed on the hook for the new value. Forgive my ignorance, is there a sales tax when property is sold? If so, a 3 million dollar price tag will still give the city/state some juice. But does this thinking inhibit investment?

How about taxing the parcel NOW at the seller's claimed value? They just went public with the ridiculous idea that piece of property is worth 3 million +. CoD should be slapping 86 mills on that. Seriously, sort of hard to argue the assessment if its YOUR assessment of the parcel's worth. I think that would end the speculation game overnight.

...whoops. just noticed dave windsor already said that.

Unless and until there are deterrents to placing outrageous values on derelict property, detroit is going to have developments continue to stall [[like the riverfront) because no one can assemble a parcel of property due to intransigent speculators.

**Wesley Mouch** · September-12-11, 10:48 AM

Originally Posted by downtownguy

I was pretty active with the GCP business association when Ilitch moved into the neighborhood, and 25 years can make my memory a little fuzzy. But, as I recall it, the city [[probably through DEGC) fronted most of the cost to Ilitch. The Fox was a great success from day one, and Ilitch paid off his debt rather quickly, but the same deal could have been granted to Forbes, and wasn't.

The deal was based upon the move of Little Caesar's 500 employees downtown, not just for the Fox. Forbes did not have 500 new Detroit jobs.

**Novine** · September-12-11, 12:22 PM

"How about taxing the parcel NOW at the seller's claimed value? They just went public with the ridiculous idea that piece of property is worth 3 million +. CoD should be slapping 86 mills on that. Seriously, sort of hard to argue the assessment if its YOUR assessment of the parcel's worth. I think that would end the speculation game overnight."

Can you play this game both ways? Can someone claim a $3 million parcel is worth $100,000 and pay taxes on that amount? Assessments are based on what the market says a parcel is worth. Unless every other property in the area is selling for those kinds of dollars, there's no basis for charging taxes other than what the market thinks those properties are worth.

**bailey** · September-12-11, 12:28 PM

Originally Posted by Novine

"How about taxing the parcel NOW at the seller's claimed value? They just went public with the ridiculous idea that piece of property is worth 3 million +. CoD should be slapping 86 mills on that. Seriously, sort of hard to argue the assessment if its YOUR assessment of the parcel's worth. I think that would end the speculation game overnight."

Can you play this game both ways? Can someone claim a $3 million parcel is worth $100,000 and pay taxes on that amount? Assessments are based on what the market says a parcel is worth. Unless every other property in the area is selling for those kinds of dollars, there's no basis for charging taxes other than what the market thinks those properties are worth.

As is lamented often...most recently in the forclosure buy-back article and discussion here, the ACTUAL FMV of property is not being used to set taxable value. If the CoD can say a parcel with a $10,000 FMV has a value for tax purposes of $50k ....no mattter what proof to the contrary brought by taxpayer, why not extend it to these situations? Look i'm only half serious here, but it seems like the same thing happens day in and day out to those who are not speculators, why not ding the d o u chebags that think 3 mill is an actual value....and because they hang on to that value, nothing moves. I'd bet dollars to doughnuts no one is going to a tax assessor with that 3 million dollar valuation.

**Gistok** · September-12-11, 01:03 PM

Do the words "Headley Amendment" sound familiar?

Back in the mid 1990s when that amendment was passed, the sales tax went up to 6%. But property taxes were reduced, and a "cap" was put on to NOT ALLOW property taxes to rise more than inflation or 5%, whichever was lower. Doesn't this prevent sudden spikes in "unimproved/unsold" property assessments? Or is that just related to residential properties?

I too don't remember the specifics of the Fox Building restoration. But as to the question of Chuck Forbes restoring the Fox.... he still hasn't completed restoring the Fillmore/State... the outer lobby and rotunda lobby were restored in the 1990s. The Grand Foyer was started by Forbes, but Live Nations finished that restoration in 2010. In the auditorium... only the procenium arch framing the stage was restored [[as were 2 columns on one side of the stage). But the other 90% of the auditorium is still in its' unrestored state [[which like the Fox never received severe damage by neglect)... however the main floor did have the cabaret style seating/bar/dancefloor put in, in the 1990s.

So if the Fillmore/State was not completed, how would one assume that the Fox would have been? Also the Ilitch's entertainment arm... Olympia Entertainments is in the business of putting on shows... Forbes never had such an infrastructure available, and has always depended on other companies to do so.

I'm not disparaging Forbes, whom I think most would agree is "Detroit's Patron Saint of Historical Preservation"... but he owned so many properties [[purchased so cheaply)... that I think he would have overextended himself by keeping/restoring the Fox.

Forbes main windfall, money wise... was in getting something like [[IIRC) $14 million from the sale of property [[mainly the YMCA, YWCA and Wolverine Hotel) to the stadium authority. And he got the Gem/Century moved to a new location... which I believe may have been paid by the DEGC [[since then DEGC chief Beth Duncombe was involved with that).

**Autoracks** · September-12-11, 09:34 PM

a stadium there is a lot better than the Temple Hotel. Those hundreds of millions of dollars invested on the north side of the freeway works towards connecting downtown with midtown. The lower Cass neighborhood gets a facelift. The current residents of the neighborhood are uprooted and who knows what happens with them. Get squeezed back towards WSU? Kinda doubt it. The neighborhood will probably improve.
I look at this area as being one of few depressed areas in the city that stand a chance of a real rebound. Connect the dots

**MSUguy** · September-14-11, 03:11 AM

The area has been a real estate hot spot for the past two years. A mysterious
buying frenzy has seen 22 mostly empty or blighted parcels sold or optioned for
higher-than-market prices.

Is this reasonable amount of land for an arena? I don't have ton of faith on Mike Ilitch's ability to development something appropriate for an urban setting I wouldn't want this part of Midtown turning into on big decorative sidewalk.

**gameguy56** · January-30-12, 04:42 PM

And still, nothing!

**Wheels** · January-30-12, 05:36 PM

Do the words "Headley Amendment" sound familiar?

Back in the mid 1990s when that amendment was passed, the sales tax went up to 6%. But property taxes were reduced, and a "cap" was put on to NOT ALLOW property taxes to rise more than inflation or 5%, whichever was lower. Doesn't this prevent sudden spikes in "unimproved/unsold" property assessments? Or is that just related to residential properties?

I too don't remember the specifics of the Fox Building restoration. But as to the question of Chuck Forbes restoring the Fox.... he still hasn't completed restoring the Fillmore/State... the outer lobby and rotunda lobby were restored in the 1990s. The Grand Foyer was started by Forbes, but Live Nations finished that restoration in 2010. In the auditorium... only the procenium arch framing the stage was restored [[as were 2 columns on one side of the stage). But the other 90% of the auditorium is still in its' unrestored state [[which like the Fox never received severe damage by neglect)... however the main floor did have the cabaret style seating/bar/dancefloor put in, in the 1990s.

So if the Fillmore/State was not completed, how would one assume that the Fox would have been? Also the Ilitch's entertainment arm... Olympia Entertainments is in the business of putting on shows... Forbes never had such an infrastructure available, and has always depended on other companies to do so.

I'm not disparaging Forbes, whom I think most would agree is "Detroit's Patron Saint of Historical Preservation"... but he owned so many properties [[purchased so cheaply)... that I think he would have overextended himself by keeping/restoring the Fox.

Originally Posted by Gistok

Forbes main windfall, money wise... was in getting something like [[IIRC) $14 million from the sale of property [[mainly the YMCA, YWCA and Wolverine Hotel) to the stadium authority. And he got the Gem/Century moved to a new location... which I believe may have been paid by the DEGC [[since then DEGC chief Beth Duncombe was involved with that).

An interesting side-note to the Forbes Ilitch dealings, Mr. Illich was not happy with Mr. Forbes when all was said and done.

Have you ever wondered why the scoreboard is so far of center in Comerica?
It does seem to block any view of Forbe property.
Can you say vindictive?