McKinley maps growth

October 8, 2007

Source: The Ann Arbor News

Date: September 19, 2007

McKinley maps growth

\New construction would link downtown properties


News Business Reporter

The McKinley Towne Centre will expand its downtown footprint from Division Street to the Michigan Theater building, under plans unveiled Tuesday night by the Ann Arbor-based real estate company McKinley Inc.

As part of the plan, McKinley says it has an option to buy the building that houses Orchid Lane and Encore Recordings at 417-419 E. Liberty St. in 2008, although current owner Ruth Fitzgerald declined to confirm any impending sale.

McKinley plans to demolish that building, as well as the empty bank building it owns that is connected to the city-owned Liberty Square parking structure.

In its place, McKinley wants to build two new, two-story facilities with matching brick facades that will cross the alley and visually connect the building that now houses AT&T and Salsarita's Fresh Cantina with the Michigan Theater building. The buildings will house office space and a mix of a half-dozen soft-goods retailers and restaurant tenants.

"This is going to tremendously revitalize the area,'' said McKinley's chief executive officer, Albert Berriz.

Berriz and McKinley's Frances Todoro-Hargreaves presented the plan to the Ann Arbor Planning Commission on Tuesday evening as part of a request to rezone the bank building at 505 E. Liberty St. and its sister Liberty Square property at 500 E. Washington St. as a planned unit development district, and approve its site plan for the new building where the bank was. McKinley owns both buildings.

The commission tabled its decision on the rezoning and site plan, due to a legal question relating to the parking structure and aesthetic issues. The request will be rescheduled for action again, likely in two weeks.

Todoro-Hargreaves said the company will begin demolition of the bank building and construction of a new, 25,500-square-foot retail and office building in its place immediately, if final approvals are received. That building will be built with a "super structure'' base, Berriz said, that will allow floors to be added on top of the building in the future.

Peter Dale, who owns Encore Recordings, said he has not heard anything from his landlord about plans to sell the building. But if a sale happens, Dale hopes McKinley will buy him out of his lease and help pay moving expenses. His space has been home to a record store since the 1960s.

"I don't have any plans to move now. I have a lease and as far as I'm concerned, I'm here for another four years,'' Dale said. "It would be very difficult to find another place to rent that I could afford with the right amount of floor space.''

The Towne Centre concept was born two years ago when McKinley bought the building at 401 E. Liberty St., the former home of TCF Bank's Michigan headquarters. The bank moved its offices to Livonia last year.

McKinley has since renovated the structure and its facade, added an entrance off South Division Street and built the building that now houses Salsarita's, which used to be a parking lot.

"This was a huge chunk of space that no one wanted to walk by,'' said Berriz.

Google Inc., the Bodman law firm and Ann Arbor Spark are located in the Towne Centre today, along with a TCF Bank branch, Bar Louie, Salsarita's and AT&T. Berriz estimates McKinley's total investment in the Towne Centre at more than $100 million.

Also in the vicinity of the Towne Centre is the planned Ann Arbor Hotel and 4 Eleven Lofts. The hotel, on the southwest corner of Division and Washington streets, was previously the site for Metro 202, which McKinley planned to develop as apartments. The hotel is going through the site plan approval process with the city.

The 4 Eleven Lofts development is a Joseph Freed and Associates apartment project that was previously know as Citi Centre Lofts and Washington Terrace.

Contact Stefanie Murray at or 734-994-6932.

Note: This story has been adapted from material provided by The Ann Arbor News.