Report: Downtown Detroit housing market, visitors bounce back but workers lag
Downtown Detroit saw its housing market and visitors bounce back last year from the COVID-driven lows of 2020, but still has a ways to go to reach pre-pandemic activity, especially in terms of downtown office workers.
That's according to the Downtown Detroit Partnership's 2021 annual report, released Wednesday.
Downtown attracted 22 million visits last year (not including workers) — up about 63% from 2020's 13.6 million visits but still well below 2019's 35 million visits. On an average Saturday, there were about 85,000 people visiting, according to data compiled by DDP.
The number of downtown workers, however, was "drastically reduced" as a result of the pandemic, the organization reported. In 2019, the median number of workers downtown during the week stood at 70,629. In 2021, that number was down roughly 75% to 17,512.
Still, DDP leaders noted that some employers are gradually starting to bring employees back to the office. Rocket Cos., for example, now has workers coming into its downtown headquarters on a hybrid schedule.
“We’re seeing more and more businesses realizing that we need to get back to work, we need to get back into the offices, and we need to get back into that personal and human engagement," said Eric Larson, CEO of DDP, during an annual meeting Wednesday timed to coincide with the report's release. The meeting was again held virtually this year.
Meanwhile, DDP reported that the downtown housing market recovered "substantially" last year. The housing vacancy rate hit a high of more than 18% in the fourth quarter of 2020 but had declined to just over 11% in the final quarter of 2021. Rent-per-unit surpassed pre-pandemic levels by Q3 of last year and has continued to rise in early 2022.
Downtown's parks and public spaces, such as Campus Martius and Cadillac Square, drew more than 4.4 million visitors last year, DDP reported.
The market value of commercial property within the Business Improvement Zone (BIZ) — owned by downtown property owners who pay a special assessment — stood at $4.58 billion last year. In 2021, a $5.093 million assessment was calculated for 576 parcels, up 5.2% from 2020.
In terms of downtown development, Larson noted about 33 projects are planned, underway or in the pipeline.
The report also notes the pandemic's significant impact on the downtown hospitality sector. Last year, hotel occupancy was 34%, up from 25.1% in 2020 but still far below 2019's 70% occupancy rate.
"As 2021 fades quickly in our rearview mirror, we look forward to a returned focus on Detroit's upward trajectory as opposed to our enormous efforts to mitigate the pandemic's effects," Cindy Pasky, DDP board chair, wrote in the report.
Wednesday's meeting also featured a panel discussion led by Nathaniel Wallace, a DDP board member and Detroit director of the Knight Foundation. The discussion featured Joshua Sirefman, the new CEO of Michigan Central, and Orlando Bailey, engagement director for nonprofit news outlet BridgeDetroit.
Sirefman talked about the symbolism of the former Michigan Central Station that sat abandoned for decades until Ford Motor Co. bought it in 2018 to develop it as the centerpiece of a mobility district.
"It's not just the international poster for the decline of Detroit, but even became the international poster for the decline of the American city," said Sirefman. "At the same time, one of the things I'm discovering ... is how much positive emotional power that building has for Detroiters and the Detroit diaspora."
Project leaders, he said, have a responsibility "to figure out that narrative in a way that we can capture the importance of that history, dispel this notion of decline, and truly represent the future of Detroit. I really believe this project is the front-line of that message and narrative. I’m not smart enough to sit here and say, ‘This is the narrative,’ but that’s the opportunity I believe we have and the responsibility we have.”
Bailey, asked about the "Detroit vs. Everybody" slogan popularized by the clothing line of the same name, said it's still relevant to some Detroit residents grappling with issues such as water shutoffs and unaffordable car insurance rates.
“The Detroit experience is rooted in, No. 1, where you come from and the circumstances of which you are living. For those of us who are more affluent with resources, some of these things are inconvenient, but we can get through it and we can still enjoy this post-Detroit vs. Everybody narrative," he said. But some city residents, he said, are "still in the thick of it. And I think we have to acknowledge that."
“I love the aesthetic of Michigan Central Station. I love how downtown looks," he added. "But what are we doing and what are providing for the spirit of our humanity, the spirit of our people, Black folks in neighborhoods? … And so Detroit vs. Everybody is still going strong, in the spirit and in the lives of so many folks.”
Bailey also called attention to a looming issue: the resumption March 31 of property tax foreclosures in Wayne County.
“Property tax foreclosure is a type of violent displacement that has been a thorn in this city’s side for the last decade," Bailey said. "And so March 31, the county is coming to collect, and there are going to be people who cannot pay. What are we going to do? There is a crisis happening in and around downtown Detroit that has not been surfaced enough, that has not been talked about enough."