Downtown Traverse City’s Economic Past, Present and Future

Downtown abuzz with life in the summer (Photo: DDA).

Downtown Traverse City is one of Michigan's favorite downtowns.  Visitors to the area say this, as do downtown professionals from other parts of the State.  Besides this, downtown is a beloved part of Traverse City life for those of us lucky enough to live here.  This we know in part because so many residents also say this.  But can we count on continued success downtown?  What is the future of downtown Traverse City?  How do we measure downtown's success?

We cannot measure downtown's success merely from positive (or negative) comments heard in casual conversation.  Current statistics are hard to come by, but those that exist tell a story of a healthy place.  December retail vacancy in downtown stands at a very low 3.9%.   Downtown employment is over 6,000.  Grand Traverse County welcomed over 2 million visitors this year, many of whom made downtown a part of their trip.

Despite these positive indicators, downtown's existence is a fragile one.  We here at the Traverse City Downtown Development Authority (DDA) are bracing for the annual January uptick in retail vacancy - one we fear may be a bit higher than recent years.  Downtown's employment base is a great mixture of many business types.  Many are here in part because their owners want them here.  Because of this, Downtown TC is in constant competition with other parts of the country and risks losing businesses if our attractiveness wanes for any reason.  As is the case with competition, we must continually get better or we will let other places pass us by. 

External risks abound.  The soft Michigan economy has impacted tourism and other sectors of our economy in the Traverse City region.  This has helped slow the housing market in the past nine months.  Despite this lull in the economy, retail and office projects are being proposed and built around the area.  The impacts of these new developments vary with their type and retail mix.  The more similar to downtown, the greater the impact.  A broader threat is sprawl.  These new retail and office projects, along with the new residential homes that either precede or follow them, stretch out across the region and disperse the population.  This increases shoppers' and workers' reliance on the automobile and discourages shopping and working in the compact environment of downtown.

Not far from the heart of the business district recreation opportunities abound.

In the 90's, downtown Traverse City was studied and plans were put in place to guide the future of the Central Business District.  In 1994, Traverse City approved a new master plan that called for greater density and improved pedestrian friendliness downtown.  In 1997, the City approved a development plan for the north side of downtown with more specific recommendations including parking decks, sidewalk improvements, pedestrian bridges and a civic square.   This plan was envisioned to spur private development in the district, and has clearly been successful.  Since the plan was approved, seven buildings have been constructed, two more are under construction, and four have undergone major renovations.

These efforts are repeating themselves in the 00's with a new downtown market analysis underway, and a new City master plan being drafted by the City Planning Commission.  Downtown's plans will have to adjust to address the latest threats, capitalize on new opportunities, and reflect the changing needs and desires of the community.

So can we count on the continued success of downtown?  Not any more than we can count on the price of gas or snow on Christmas.  Downtown's success must be worried about, managed and planned.  Taking it for granted would be a huge mistake.  If it were taken for granted in the 90's, we might have a very different downtown than what we have today.

What is the future of downtown?  With care and planning, that is up to the community.  Planning often focuses on the physical aspects of downtown but must also recognize the economics of the place.  We must plan to attract and retain good jobs, promote continued private investment and encourage the success of our retailers.

The other night, I was downtown enjoying a cocktail with some businessmen who were toying with the idea of relocating their businesses downtown.  They were excited about the idea in part because they were enjoying their evening downtown.  We were warming up in a nice restaurant from an evening of holiday shopping.  Downtown was busy, alive and fun.   Perhaps a good measure of success is how fun downtown is.

What is downtown's future?  We don't know for sure, but change is certain.  It behooves us to be proactive and set the stage for positive change and not leave downtown's future to chance.

Rob Bacigalupi is Deputy Director of the Traverse City Downtown Development Authority and enjoys studying Downtown Traverse City from West Bay in the comfort of his kayak.