Jefferson East Investing Guide

Here's Model D's guide to investing in Jefferson East. Also check out our guides to visiting and moving to Jefferson East.

It is early morning in Jefferson East. The sun is rising over the old business district, and over the shopping centers, the historic homes in the Jefferson/Chalmers district, the new million dollar homes on Grayhaven Island, the infill homes for working families, and homes rehabbed by Habitat for Humanity.

It’s not yet prime time. It is a promising time, however, tempered by the risk of urban living – a perfect combination for entrepreneurs like Lisa Burnett and Josephine Marino, who own two large abandoned buildings but believe a new day is coming. They think of it as a “calculated risk.”

Marino, a Grosse Pointe Park artist, had outgrown her home studio and was looking for a larger space. She spotted one on East Jefferson, near Alter Road, that met her criteria, plus some – a three-story, 30,000 square foot former BF Goodrich tire store and warehouse. But there is a marketing challenge ahead for this huge space. Marino envisions a possible café/exhibition/performance space on the first floor, rented artists studios on the second floor and the third floor reserved for her own work. Her potential investors are people on both sides of Alter Road – Grosse Pointers looking for an artsy, urban experience and Detroiters looking for a place for creative expression. “It’s the sheer geography” of the East Jefferson location that drew her in, she says, “(and) the building itself has a really great energy. I’m not so far down Jefferson – and I’m pretty close (to Grosse Pointe).” She has her doubters. “I’ve been asked, ‘Who are you going to get to go there?’ ” Her response? “It will be so cool that they’ll want to go.”

Marketing push

Cool, in fact, is the vision of the Jefferson East Cool City initiative, recognized by the State of Michigan for its progressive goal of supporting incubation for technology and entertainment businesses in the traditional business district. Its annual music festival, “Jazzin’ on Jefferson,” gives the neighborhood a marketing push by reinforcing the brand of the area, says Chris Garland, program director for the Jefferson East Business Association (JEBA). In addition to restaurants and businesses, JEBA also showcases “Eastside Living” at the festival, featuring the various housing options available in Jefferson East.

“It doesn’t spur development, but it promotes what’s going on,” Garland says. “Investment is absolutely something we tout to anyone who is listening. We talk about “Jazzin’ on Jefferson” as something that reinforces what’s exciting here, reinforcing the importance of making that investment.”

JEBA promotes investment in the area with assistance including facade improvement grants, small business loans, historic tax credits, marketing consulting and reduced rent incentives for entertainment and technology-related business. The association is also recruiting apparel shops, specialty food markets, florists and restaurants and other businesses.

Investors now need a creative vision and a leap of faith. “Maybe I’m a little naïve, but if you offer people something that is safe and close, hopefully, they’ll step out of their security blanket,” says Marino. “Grosse Pointe does not offer much in the arts. If we want anything, we have to travel. I don’t want to drive to Birmingham. I like it because it is close. As long as it’s safe, secure, and clean, they will come.”

Marino’s project may help erase the borders between Detroit and its suburbs by stressing commonality over geographic division. “It was always my thought for the building – to bridge young and old, rich and poor, black and white. I like that in my own life. …I’ve talked to a lot of Detroiters (in the area) who are excited. They also don’t feel that they have anywhere to go.” She has been asked by Detroit residents to provide space for comedy, dance, and musical entertainment as well as restaurant space. “I have Grosse Pointe people who want me to provide art and poetry. … My real love is the youth. For teenagers, there’s no cool place to go. Grosse Pointe does a lot for sports, but we don’t do much in terms of the arts.”

A neighborhood jewel

Lisa Burnett believes her 5,000 square foot Monticello Ballroom is “a jewel that hasn’t been tapped.” She’s not deterred by the current state of the storefronts. In fact, she’s a conservative developer, says Garland. “Like Josephine Marino, she does development the old fashioned way. She’s not coming in with a massive bank of money or a great deal of history in development. Nor is she leveraging all of the economic development tools that are out there. She’s leasing out her space, bringing in revenue and reinvesting in her property.” Garland says Burnett has benefited from façade improvement funding through the Cool Cities initiative and is restoring the building’s ballroom for functions like weddings.

With the vacant buildings, lack of much business activity, scarcity of parking and personal and property risk, developers working in Jefferson East “make a calculated risk,” Burnett says, adamant that better times are ahead for the area. “Royal Oak didn’t become Royal Oak overnight. It may not have had the level of decline, (but) there are some significant parallels as to how the area was.”

One of the earliest developers in the area and longtime proponent of Jefferson East, Michael Curis, is cautiously optimistic for future development in the area. With Riverbend Plaza, Heritage at Riverbend Condominiums and Mack-Alter Square to his credit, he admits the future isn’t clear. “A lot of people are taking a wait-and-see attitude. Because of that there is a lot of indecision right now,” says Curis, who is also a JEBA Board member. “We’re going through a very difficult time. Our focus is maintaining what we have and maintaining it very well, and if the opportunity comes up, to expand.”

He’s excited about the prospect of a landscaped street improvement plan for Jefferson, under development by the business association. “That’s the one thing we need to do. Above anything else we need to push and get an island in the middle,” he says. “It extends the beautiful (streetscape) from Grosse Pointe. It slows traffic down. It makes a much prettier drive than nine lanes of asphalt. It raises the value of all the property that surrounds it and gets people to want to reinvest.”

Two development styles

In some respects, there are two main streets along East Jefferson, seemingly at odds with one another. One is the traditional business district with its vintage 1920s storefronts – some recently restored, others boarded up -- situated close to the once populated pedestrian walkways. The other is further west, featuring more expansive shopping centers with national franchise stores and other larger businesses, and an abundance of surface parking. These divergent development styles reflect a conflict: do you suburbanize the city or do you build off its historic streetscape, which was built before cars and personal insecurity were issues for shoppers?

Jefferson East believes you can have both, and believes you can link them through a thoughtful streetscape. “We recognize that there are a couple sections of commercial development,” Garland says. “At the same time, we’re saying we wouldn’t want to put up one random block of streetscape.” There needs to be a continuous linkage all along East Jefferson, to link isolated projects like Winston Place, an apartment building under redevelopment, so they feel “part of a neighborhood street.” Garland adds that this is more than landscaping the street. It also involves a plan for parking, which is a critical issue for development.

It is always morning at Joseph’s Coney Island where Kole Nikollbibaj works 10 hours a day serving breakfast any time, along with premium Coney dogs and a sandwich menu. He says, “there is a very good possibility” of a dinner menu to come. He knows there is a need and he aims to fill it. His customers are workers at the DaimlerChrysler Jefferson Avenue Plant, at various construction projects in the area, or are residents of the neighborhood. “I love the eastside,” says the Kosovo native who was raised in Detroit. “It seems so homey to me.”

Nikollbibaj, whose employees all come from Jefferson East, builds his business on value, respect for his customers, and an honest work ethic. “I put my heart and soul in this business.” That includes giving hot dogs to church and community groups for special events.

Liabilities into assets

Despite the larger shopping strips that were developed on the west end of the community, a greater challenge is stopping the deterioration of the central business district, improving the facades, and marketing the storefronts to small businesses, says Alan Levy, deputy director of Planning and Development for the City of Detroit. Levy was formerly director of the Mayor’s Office of Neighborhood Commerical Revitalization.

The acquisition of the former BF Goodrich building represents “a huge shift in the investment attitude,” says Levy. “People will buy a property to flip it (sell it quickly for a profit) or sit on it and wait for someone to clear it and use it for a strip mall, or they’ll buy a property because they think if they improve it, it’ll be worth more. This is definitely a sign of the third. She’s saying we’re turning it from a liability to an asset. … I don’t know how much she paid for it, and it wasn’t cheap, but it may be that what she’s doing there will spur other things to happen. Our position is that all the little things Jefferson East is doing – all the clean-ups, the murals, working with the police department, becoming a Cool City – they’ve determined that they’re a pretty good place for a technology and entertainment incubator.”

Citing that the vacancy rate for the old storefronts remains about 50 percent, Levy says, “The situation was getting worse before Jefferson East began doing what they’re doing. The key is that it hasn’t gotten worse. … And the renovated buildings are leased. We’re about at the point where values will start to go up. They stopped the decline by organizing themselves. I’m not sure when it will be a hot market, but it has that potential.”

Wanted: people with vision

Trek Computers is an example of how Jefferson East could realize its Cool City vision. Not only is it a new technology company, it’s owned by someone who lives in the area. “I picked here because I was born and raised in this neighborhood,” says Donnie Hall. “The other reason I picked this area was that I saw the need to bring this service into this community. … Most homes in this area don’t have computers and don’t even know about the internet. If they do happen to play with the computer the first (problem they have) they’re going to give up.”

To help cultivate a more technologically savvy community, Hall offers free basic computer and basic internet classes in his shop on Saturdays. “That’s not (funded by) grant money, (it’s) something we’re offering ourselves.”

Investing in Jefferson East is built on the faith of people like Burnett, Hall, Marino and Nikollbibaj. But realistic challenges remain. Although 25,000 cars pass through the area daily, there needs to be more traffic. Although nearly 20,000 people, with a median household income of $41,612, live in Jefferson East, there needs to be more residents with disposable income. It’s a time for a calculated risk for people with vision, and for people who care about the community. Only the strong need apply. But most need to apply patience and fiscal endurance.

But it’s still early. “It’s really on the ground floor, now,” Levy says. “There’s always the possibility that the elevator won’t go up. But we’re at the point where we know it won’t go down.”

Directions to Jefferson East

From the East:
Take I-94 West to Outer Drive Exit 222A toward Chalmers Ave. Turn left onto Outer Dr. East and stay straight to go onto Alter Rd. Turn right onto Jefferson Ave East and arrive in Jefferson East.

From the North:
Take I-75 South and merge onto I-94 via Exit 53B toward Port Huron. Take the Conner Ave Exit 220B toward the City Airport. Keep right at the fork in the ramp and stay straight to go onto Conner St until you come up to Jefferson Ave E. Arrive in Jefferson East.

From the West:
Take I-96 East and merge onto I-94 via Exit 190A toward Port Huron. Take the Conner Ave Exit 220B toward the City Airport. Keep right at the fork in the ramp and stay straight to go onto Conner St until you come up to Jefferson Ave E. Arrive in Jefferson East.

From the South:
Take I-94 East toward Detroit. Take the Conner Ave Exit 220B toward the City Airport. Keep right at the fork in the ramp and stay straight to go onto Conner St until you come up to Jefferson Ave E. Arrive in Jefferson East.

Take I-75 North toward Detroit to I-96 West via Exit 48 on the left toward Lansing. Then merge onto I-94 East toward Port Huron. Take the Conner Ave Exit 220B toward the City Airport. Keep right at the fork in the ramp and stay straight to go onto Conner St until you come up to Jefferson Ave E. Arrive in Jefferson East.

New Market Rate Housing Along Jefferson and the Detroit River

Daimler Chrysler's Jefferson North Plant

Mack Alter Shopping Plaza

Joseph's Coney Island

Trek Computers

All Photographs Copyright Dave Krieger