Why Detroit this year has been a tale of 2 downtowns
JC Reindl, Detroit Free Press
9 min read
Detroit this year has been a tale of two downtowns.
There is the workday downtown, where office towers have tens of thousands fewer workers Monday through Friday than before the COVID-19 pandemic, while lunch spots and sidewalks remain significantly less busy than they were in 2019.
Then there is the nighttime and weekend downtown. This is when sidewalks fill with locals and suburbanites checking out the latest trendy restaurants and cocktail bars, along with tens of thousands more visitors — some overnight guests with hotel keys — coming for sports games and Detroit's increasingly packed calendar of big concerts and megaevents.
Don Brown, 56, of Beverly Hills, (right) and Eric Shreffler, 53, of Beverly Hills sit down for dinner with their wives at Leila restaurant in downtown Detroit on Sept. 29, 2023.
Meanwhile, a growing number of people have moved into apartments and condo buildings in and around downtown — many with significant disposable income.
This bifurcated downtown is captured in the latest location analytics data, and is obvious to downtown residents and regular visitors such as Shannon Jackson, 34, who moved from a downtown apartment to East Jefferson near Belle Isle several years ago, yet is still downtown a lot.
While the sidewalks can be relatively quiet at midday on weekdays compared with pre-pandemic years, the number of people out and about in downtown really starts to pick up by Thursday evening, she said.
Shannon Jackson, 34, of Detroit, carries a bag of cat food she just purchased at Premier Pet Supply in downtown Detroit on Sept. 29, 2023. Jackson says she lived in downtown Detroit before purchasing a home on E. Jefferson Avenue near Belle Isle and loves to come downtown to exercise.
“I was worried for a little bit. It seemed right after COVID, things were not at the same level they were. I think there was a core group of restaurants and hospitality groups that kind of kept the city going," Jackson said. "But I will say in the last year, I’ve really seen a huge resurgence again in the city. It just feels like it’s more lively and it’s coming back."
Downtown's Capitol Park neighborhood was bustling on a recent Friday evening that coincided with a Tigers home game.
Don Brown, 56, of Beverly Hills, was out for dinner with his wife and another couple. They visited Leila, 1245 Griswold St., a restaurant named by GQ magazine three years ago as one of the 16 Best New Restaurants in America. The building was completely empty and boarded up just six years ago.
Don Brown, 56, of Beverly Hills, (right) and Eric Shreffler, 53, of Beverly Hills walk into Leila to meet their wives for dinner in downtown Detroit on Sept. 29, 2023.
Until relatively recently, Brown only occasionally went out in Detroit and was spending more time at places in Birmingham, Royal Oak or Ferndale. Now he said he comes downtown about every other weekend, and notices that many others are coming out, too.
“A lot more people," he said. "A lot more people are staying downtown after hours, going to some of the nice bars and hanging out.”
Visitors data
The nonprofit Downtown Detroit Partnership recently published data on downtown activity captured by location analytics firm Placer.ai.
One figure showed how the average number of workers per day in downtown (Monday through Friday) was just over 35,000 in June compared with 70,000 in June 2019 — before the pandemic led to a surge in remote and "flexible" work arrangements that emptied out offices.
Jeff Komasara (left) and Brian Nottmeier, both of Grosse Pointe, walk to see the Peter Gabriel concert at Little Caesars Arena in downtown Detroit on Sept. 29, 2023.
Another showed the average number of downtown visitors — not counting workers or downtown residents — as being nearly back to 2019 levels at just under 110,000 visitors per day in June.
“We need more businesses — both new businesses coming into the city as well as more existing business to encourage their employees to be back in the office," said Downtown Detroit Partnership CEO Eric Larson. “On the flip side, we are exceeding all expectations on the visitors.”
A hot events summer
It's not only nearby suburbanites who are coming down.
The total number of downtown visitors was up this summer, according to the Detroit Metro Convention & Visitors Bureau, driven by big events such as the much-celebrated return to downtown of the Grand Prix and the annual Detroit Auto Show, plus sold-out concerts at Ford Field featuring big names like Beyoncé, Taylor Swift and country music star Morgan Wallen.
And the party isn't over. Next year, as many as 500,000 visitors are expected when Detroit hosts the 2024 NFL Draft on April 25-27.
Kam Braxton, 31, who moved here from Flint, (left) and her girlfriend Caitlin Smith, 31, of Saginaw, talk about why they moved to downtown Detroit post COVID on Sept. 29, 2023.
More of those out-of-town visitors have been spending the night. The downtown hotel occupancy rate this year through late September was 49%, up from 46% in the same period a year earlier, according to data compiled by the convention and visitors bureau. The average daily hotel rate rose 8% to $169 in about the same timeframe.
Detroit's mid-2010s mini-boom in new boutique hotels, which saw the opening of upscale properties like the Aloft, Shinola, Foundation and Siren, has roared back. This summer had three new boutique hotels grand openings:
The 117-unit extended stay ROOST Apartment Hotel in Dan Gilbert's newly restored and reopened Book Tower, 1265 Washington Blvd.
The 158-room Cambria Hotel, 600 W. Lafayette Blvd.
The 227-room Godfrey Hotel, 1401 Michigan Ave. in Corktown.
Claude Molinari, president and CEO of the convention and visitors bureau, said one thing holding Detroit back from landing even more conventions and megaevents, like the NCAA Final Four, is a lack of downtown hotel rooms — especially rooms within walking distance to the Huntington Place convention center, formerly known as Cobo Hall.
Yet he is encouraged by the new hotel supply on the horizon. A 154-room Marriott International AC Hotel is under construction on Woodward in Midtown; Gilbert's Bedrock firm has plans for a potential 227-room Edition Hotel in the under-construction Hudson's site skyscraper; and the Ilitch organization and New York developer Stephen Ross are collaborating to build two new hotels in their District Detroit development. (One for next to Little Caesars Arena, the other would convert Fox Theatre office space to hotel rooms.)
Molinari also is hopeful that definitive plans can emerge soon for a hotel next to Huntington Place, which is a common request from conventions scouting Detroit as a possible location.
“This city could easily absorb another 2,000 hotel rooms and it wouldn’t even scratch the surface of the demand that’s out there," Molinari said.
New housing options
Another bright spot is the expanding quantity and quality of downtown housing. This summer saw the addition of 229 high-end apartments in the reopened Book Tower, as well as 153 apartments plus 12 luxury condos in The Exchange, an all-new high-rise at 338 Gratiot in Greektown.
People stand inside the Book Tower building during its ribbon-cutting ceremony on Thursday, June 8, 2023.
The vacancy rate for downtown apartments in the second quarter was 15%, up from 8% when the pandemic began in the first quarter of 2020. The latest figures include several new and upscale market-rate buildings that have opened since then, including The Press/321 at 321 W. Lafayette Blvd. and City Club Apartments CBD Detroit at 313 Park Ave.
However, real estate insiders have recently observed a mild softening of the housing market in greater downtown, a possible result of lower employee headcount at Gilbert's downtown-based Rocket Companies, which is feeling the current downcycle in the mortgage business, and perhaps of the market needing time to absorb all the new units.
Early next year, nearly 500 more apartments will flood the market when a new 25-story glass tower, The Residences at Water Square, opens on the former site of Joe Louis Arena near the Detroit River. Some of the units have been pre-leasing for over $4,000 a month.
Kitchen and living area of a one bedroom corner in The Residences at Water Square on the former site of the Joe Louis Arena on Tuesday, June 27, 2023.
Further ahead, 97 upscale condos are expected in the Hudson's site skyscraper, which could be done by late 2024.
The future occupants of those luxury towers would presumably have the income — or at least the credit card limits, after paying rent — to support the flurry of new high-end restaurants and bars that continue to open in downtown.
A return to Detroit
Naomi Scott, 37, is a manager at the newly opened Le Suprême French bistro in the Book Tower. Previously, the entire tower had been dark and empty since 2009.
Scott grew up in Detroit and, after 15 years of living and working in Ann Arbor, moved back two years ago and now lives near Indian Village with her partner.
Naomi Scott, 37, of Detroit, (left) is the operations manager at the Le Supreme, a new French restaurant in the recently reopened Book Tower, and walks to dinner with her wife Lauren Scott, 38, of Detroit, in downtown Detroit on Sept. 29, 2023.
At the time she left for Ann Arbor, the city's downtown “with all the abandoned buildings, there just wasn’t a whole lot of activity, except for maybe a festival. Otherwise, there wasn’t a lot going on or to do."
"And then it seemed like everyone was leaving Ann Arbor and coming back to Detroit for work," she said. "It just seemed like everything was happening here, and it was like, 'We can’t miss out on the opportunity to be in this space.' ”
Today, there are more activities, entertainment and food and beverage options in downtown than Scott has ever seen before.
“To watch everything continue to blow up is an amazing thing, and I’m excited,” she said.
Some of the first residents to move into the Book Tower's apartments this summer were Kam Braxton and Caitlin Smith, both 31, who arrived in Detroit from Flint and Saginaw, respectively.
Kam Braxton, 31, who moved here from Flint, (left) and her girlfriend Caitlin Smith, 31, of Saginaw, talk about why they moved to downtown Detroit post COVID on Sept. 29, 2023.
“We’ve only been here for a couple months, but there is always something to do," Braxton said of downtown. "We’re always having a good time. We’re always finding new places.”
Another newcomer is Caio Barros, 34, who arrived in August from Brazil for work. He said Detroit so far has been better than he anticipated. Although a once-popular fast-casual eatery in his downtown apartment building, Go Sy Thai on Griswold, recently closed, he was happy to hear that another restaurant could be going in.
“The restaurants and all the places that you can go — it’s really cool,” he said.
Caio Barros, 34, moved to downtown Detroit a month ago from Brazil for a job in Academia and talks about living downtown on Sept. 29, 2023.
Retail takes some Ls and Ws
Retail in downtown has seen losses and wins since the pandemic and accompanying drop in weekday foot traffic from office workers.
On the plus side, a Gucci store opened last year at 1274 Library St. and Rihanna's Savage X Fenty lingerie brand is expected to open soon at 1442 Woodward Ave.
The new Gucci store on Library St. in Detroit opened its doors for the public on August 19, 2022.
But downtown also saw the closure last year of an Under Armour store and women's apparel retailer Madewell. And the Moosejaw store on Woodward is also slated to close next year as part of the retailer's companywide consolidation.
"The fact that we don’t have as much of the consistency of weekday daytime population makes it harder on those businesses," Larson of the Downtown Detroit Partnership said of downtown retail, "so we need to be very focused and very deliberate on how we’re continuing to support those businesses in the near term. In the longer term, I feel very bullish about our retail opportunities."
Looking ahead to next year, new prime retail space could open in the 12-story office block portion of the Hudson's site development. The office block will also contain about 400,000 square feet of office space, and appears closer to completion than the neighboring 49-story Hudson's residential and hotel skyscraper.
Even though there are fewer people at their office seats than before the rise of work-from-home, the vacancy rate for downtown Detroit office space has lately hovered around 13%, according to real estate firm JLL, although sublease space availability is up.
Contact JC Reindl: 313-222-6631 or jcreindl@freepress.com. Follow him on X @jcreindl.
