My frustrating search for retail space in Detroit

[MSUguy]

You wouldn't think finding space for a business would be hard in Detroit. But Pages a pop-up bookstore on Livernois looking for permanent space talks about how hard it can be. If there is any good they did recently find one on Grand River in the Rosedale Park area. But it makes you wonder how many businesses the city is losing on because of this problem.

The simple reason that Pages isn't open is that I can't find commercial retail space. How can that be?!? There are vacant storefronts up and down Livernois and Grand River where I would like to open. Just so everyone knows, I have been looking for a permanent home for about 18 months. The reason for not being open is simple, but the problem behind it is far from simple.
To be clear, my requirements for a building are a solid roof, HVAC that works, a bathroom, and a relatively clean and open space. Here is what many small businessesand I are facing:

• Vacant buildings have been unmaintained for many, many years. For them to be viable retail space, they typically need renovation work including new roofs, new HVAC systems and in many cases new windows and doors. Building owners are not willing or able to invest in their own buildings. New tenants are required to finance this renovation and all other work to get a Certificate of Occupancy from the city of Detroit. Business owners are not offered a reduced lease rate to offset these improvements.
• The point above is only applicable if I’m able to find out who owns the building. This is an amazingly difficult task. The tax records are available but are shockingly inaccurate.
• If there is a business operating in a building, or if a businessrecently vacated a building, I have tried to contact them to search out the building owner. I have found that these businesses generally have no online presence and are not registered with the state of Michigan. Contact information doesn't exist. No registration with the sate means no accountability or taxes paid.
• Building owners are unexplainably unresponsive. I’ve had too many unreturned phone calls to count.
• Building owners that I reached aren't interested in leasing. Usually, they have future plans although I haven't seen any of these plans come to fruition during the last 18 months.

A quality building leased at realistic market rates will attract a quality business. However, there is a very stubborn pattern of building owners collecting rent payments from anyone who will pay for a sub-standard building. The businesses who move in under these circumstances aren't interested in obtaining a Certificate of Occupancy, abiding by the approved use of the building, hiring licensed contractors, etc. These are the businesses that come and go and bring down the revival of neighborhood commercial districts. The community members assume a new business won’t last so they don't patronize them. This vicious cycle will continue until, as a community, we can find a way to stop it

http://www.pagesbkshop.com/my-frustr...-space-detroit

[Dumpling]

Here is what JBMcB said on the "Ameliorating Poverty" thread:

"Too long/didn't hear version:
Expensive licensing fees and lengthy, obtuse regulatory regimes affect the poor business owners much more than the big chains. It pushes them into the informal economy, where they have no resources to grow their way out of poverty, and they usually do not pay taxes or fees - revenue the city loses out on.

If it takes a year to get an occupancy permit to open a Bo Rics downtown - Bo Rics could care less - they'll sit on the property until they can move in. If you are leveraging your house to open your own barber shop, you can't wait a year until you start making money. You have mortgage payments NOW. You have to buy groceries NOW. So why bother? Cut people's hair in your basement, all-cash, no income reporting required, and you can stay on public assistance."

I can't add more to this except to wish the new retailers all the best, and that it will be a good sign if your nearby neighbors drop by, pleased as can be, while you are setting up your store, should you get that far.

[antongast]

Here is what JBMcB said on the "Ameliorating Poverty" thread:

"Too long/didn't hear version:
Expensive licensing fees and lengthy, obtuse regulatory regimes affect the poor business owners much more than the big chains. It pushes them into the informal economy, where they have no resources to grow their way out of poverty, and they usually do not pay taxes or fees - revenue the city loses out on.

If it takes a year to get an occupancy permit to open a Bo Rics downtown - Bo Rics could care less - they'll sit on the property until they can move in. If you are leveraging your house to open your own barber shop, you can't wait a year until you start making money. You have mortgage payments NOW. You have to buy groceries NOW. So why bother? Cut people's hair in your basement, all-cash, no income reporting required, and you can stay on public assistance."

I can't add more to this except to wish the new retailers all the best, and that it will be a good sign if your nearby neighbors drop by, pleased as can be, while you are setting up your store, should you get that far.

That's not her point, though. She's not criticizing onerous government licensing regimes, she's criticizing speculative property investors who refuse to do basic upkeep or offer their buildings for rent on reasonable terms.

People, on this board and elsewhere, often make the argument that the best way for Detroit to maximize the well-being of its citizens is to cater to the whims of speculative real estate investors to the greatest extent possible, and to make no effort to restrict or regulate their behavior in any way. Others then point out that this argument is a steaming pile of horseshit. This article strikes me as a compelling piece of evidence in support of the latter school of thought.

[Dumpling]

A small part of Pages' problem is due to government issues - for example, the inaccurate tax records mentioned. During the Engler administration the State of Michigan moved to online databases in a big way, so it is an oversight if businesses aren't listed in some State of Michigan database for tax purposes and identification purposes.
I checked the Grand River/Livernois business district on Google Maps. There are a good many
businesses, but the overall impression is of repurposed industrial buildings with churches and
liquor stores. Fast food outlets, dollar stores and groceries tend to be in newer buildings. There are a few old buildings with for sale signs on them. They would need massive amounts of work
well beyond adding HVAC to become bookstores. I think some of Pages' problem in that
particular area is due to scrapper forces. Either a building is an ongoing business or other entity with ongoing staffing and security provisions, or it is left alone and is then relatively quickly scrapped out. This doesn't mean that those building owners aren't speculators that won't sell or renovate.

[DetroitBoy]

You wouldn't think finding space for a business would be hard in Detroit. But Pages a pop-up bookstore on Livernois looking for permanent space talks about how hard it can be. If there is any good they did recently find one on Grand River in the Rosedale Park area. But it makes you wonder how many businesses the city is losing on because of this problem.


http://www.pagesbkshop.com/my-frustr...-space-detroit

The mayor created the Department of Neighborhoods and has a District Manager resident in each district. I would contact the one in the district you are looking for a space in and ask them for help or a referral. They interact with several business groups, clubs and organizations in their district and may be able to help you.

[sumas]

The mayor created the Department of Neighborhoods and has a District Manager resident in each district. I would contact the one in the district you are looking for a space in and ask them for help or a referral. They interact with several business groups, clubs and organizations in their district and may be able to help you.

Excellent advice I was going say exactly the same thing but was distracted cooking for company. I will add that many non profits can provide grant monies or info on whats available for start up costs. My info for orgs, retail space, is eastside based, no clue on westside.

[Dan Wesson]

All these frustrations offered here are real and of course negative.

But listen carefully, the "Market" is speaking.

Do not go forward with eyes wide shut either.

[Hermod]

That's not her point, though. She's not criticizing onerous government licensing regimes, she's criticizing speculative property investors who refuse to do basic upkeep or offer their buildings for rent on reasonable terms.

Translation: Good buildings that I want aren't cheap rent. Cheap rent buildings are not what I want.

[antongast]

Translation: Good buildings that I want aren't cheap rent. Cheap rent buildings are not what I want.

Did you read her post? Her requirements seem pretty basic to me.

To be clear, my requirements for a building are a solid roof, HVAC that works, a bathroom, and a relatively clean and open space.

I'm hard pressed to think of a market niche for a commercial building with a leaky roof and nonfunctioning HVAC. What sort of tenant could possibly find a use for such a structure?

[Dumpling]

Looks like Pages has found a new home!

http://www.deadlinedetroit.com/artic..._name=business

[Parkguy]

A small part of Pages' problem is due to government issues - for example, the inaccurate tax records mentioned. During the Engler administration the State of Michigan moved to online databases in a big way, so it is an oversight if businesses aren't listed in some State of Michigan database for tax purposes and identification purposes.
I checked the Grand River/Livernois business district on Google Maps. There are a good many
businesses, but the overall impression is of repurposed industrial buildings with churches and
liquor stores. Fast food outlets, dollar stores and groceries tend to be in newer buildings. There are a few old buildings with for sale signs on them. They would need massive amounts of work
well beyond adding HVAC to become bookstores. I think some of Pages' problem in that
particular area is due to scrapper forces. Either a building is an ongoing business or other entity with ongoing staffing and security provisions, or it is left alone and is then relatively quickly scrapped out. This doesn't mean that those building owners aren't speculators that won't sell or renovate.

Nope, not scrappers. The Livernois area she was looking at is not anywhere near Livernois/Grand River. It is miles north of there, between 7 Mile and 8 Mile. Those areas are nothing alike. The neighborhood she is moving into [[and we are very happy to have her move here!) is along Grand River between Southfield and Evergreen, in Rosedale Park/North Rosedale Park. I have talked to her about the blog entry, and what she said in the article is a good summary of her feelings about it. She expects landlords to take care of their property, offer a good product, and charge accordingly. That is not what she found, though. She realizes that the city has code requirements and permits, and expects to go through that process.

[sumas]

That's nice ParkGuy, always welcome new businesss. When she opens. Please notify. I have a couple of books I would order for neighborhood kids if she ships. I no longer drive. Geez I sound ancient but am not. I was legally blind for years and didn't drive. Surgery corrected vision problems but now I am aprehensive.

I want "Where The Sidewalk Ends, and "A slighty Messey Cookbook". I could get these on line no doubt, just prefer to support Detroit based businesses.