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Metro Detroit Aerotropolis: Why You Should Care






Aerotropolis. The name has such a futuristic connotation. The word was coined by a university professor who envisioned instant cities growing up around airports that aggressively position themselves as major arteries in the flow of goods destined for need-it-now consumers around the world.

It's a word that can also be a head-scratcher around the water cooler, or since we're talking about global commerce, at the coffee shop where fair trade beans brew and consumers snap up tumblers made in China, flavored teas from round the world and Belgian chocolates.

While Aerotropolis sounds so space age, so far away and in some circles so foreign, it is here and now. Believers in the Detroit Region Aerotropolis see it as an elixir for the region's economic ills. It's an elixir that's been mixing for several years now as consultants, academics, politicians and economic development officials have studied Detroit's potential to compete globally with its not one, but two airports: Detroit Metro and Willow Run.

The studies and the support-building that's taken place have identified 60,000 acres of land around both airports, about 30,000 acres of it ready for development. This land is particularly attractive because of its multi-modal access (highways, railways and waterways)--what companies reliant upon shipping goods and services globally consider the holy grail. And thanks to cooperative governmental efforts to streamline the permitting process, and legislation put in place (some of it as recently as last week) companies could be lured to Southeast Michigan with serious tax breaks and a speedy process from proposal to opening day.

A global hub

Detroit is just one of many cities around the globe betting on airports as the next facilitator of economic prosperity. In Detroit, it could be the answer to diversifying and filing the gap left by the shrunken U.S. auto industry. Think of airports as the river of the future, say Aerotropolis supporters, a sequel to the seaports, railways and highways that shaped America's landscape in the past.

In the Detroit area, if the Aerotropolis vision is realized, it could mean becoming home to industries that trade in time-sensitive manufacturing, e-commerce fulfillment, telecommunications, and logistics. These companies in turn would be ringed by hotels, restaurants and retailers, followed by a ring of residential development. It's a model put forth by University of North Carolina professor and dean at the Kenan Institute of Private Enterprise John Kasarda, author of Aerotropolis: The Way We'll Live Next and consultant to many Aerotropolis projects around the world (including Detroit).

After Kasarda sold Metro Detroit on the Aerotropolis model, studies, research, fundraising and regional team-building began between two counties (Wayne and Washtenaw), seven communities (including Belleville, Ypsilanti, Romulus and Taylor), and several large companies and nonprofit organizations. This has led to the establishment of an airport authority, which has, for the last four years, followed a deliberate plan of action and a series of legislative policies to entice businesses to Michigan. Now entering the marketing and branding stage, Aerotropolis is as close as its ever been for a full take-off.

What it means

Looking at the economic landscape of the Detroit Region Aerotropolis so far suggests that the ground is encouragingly fertile. General Electric's Advanced Manufacturing and Software Technology Center and its 1,000-plus employees in Van Buren Township has teamed with lithium ion battery manufacturer A123 Systems to establish a Center of Energy Excellence. Tax break legislation has been put into place. Still, it's important to discuss what Metro Detroit has going for it and what's working against it.

After all, the region is competing against nearby airports like Louisville, Ky. and Memphis, Tenn., which have already become central hubs for UPS and Fedex. And with global expectations and implications, our just-budding commitment to the Aerotropolis concept will have to go toe-to-toe with airports around the world, where the idea has firmly taken root.

First let's look at the numbers behind the Detroit Region Aerotropolis. Consultant Jones Lang LaSalle's economic impact study found that with successful business attraction efforts, after 25 years of construction and full build-out of 13 primary development sites, the Detroit Region Aerotropolis has the potential to bring in 64,000 additional jobs to the region with wages of $3.8 billion per year and more than $10 billion of additional annual economic activity. By comparison, the booming Triangle Park in North Carolina employs 20,000 people.

The Aerotropolis is also expected to add an additional $30 million from the Michigan Business Tax, $67 million in personal income tax, while property taxes could generate $74 million annually for municipalities, county, local school districts, the state education tax fund, and community colleges.

The initial building of businesses, infrastructure improvements, and such will add a one time economic punch of $173 million per year and another 1,500 jobs with wages of $78 million.

Except to the detractors who call the Aerotropolis theory pie-in-the-sky, quick-fix urbanism, the numbers all sound great. But can the Aerotropolis work here? Will the Aetrotropolis, as supporters contend, return the region to the lucrative days before the auto industry went into neutral?

Wayne County Executive Robert Ficano, who sees the Detroit Region Aerotropolis as "an economic engine that will transform Michigan," says this process has been anything but a quick fix.

It is a long-term, sustained development that will be a magnet for jobs for years, building over the years, he explains. What a successful Detroit Region Aerotropolis will require is faith and commitment paired with keen marketing and understanding of which companies will make the Detroit-area airports successful beyond just transporting passengers and packages.

"You always want it to move faster, but this is a marathon, not a sprint," he says.

If you've read this far, you are at least mildly interested in what this all about, but this project does beg the question: Why should we care?

"I'm going to make it really simple: Jobs. jobs, jobs, jobs," says Verna McDaniel, Washtenaw County administrator. "That's why people should care. Period. And we're talking about all kinds of jobs."

So what's working in Detroit's favor when it comes to realizing an Aerotropolis?

For starters it has two airports: Willow Run, an on-demand cargo facility, and Detroit Metro, an international passenger and cargo operation - the 19th busiest airport in the world, serving 36 million passengers each year. The two airports are located less than 10 miles apart, together provide 11 runways (more than any airport in the world) and are lauded for their efficiency. This will allow Detroit to compete with global behemoths like Schipol, in Amsterdam, and in Shanghai, China.

Also putting Detroit in the big leagues is its proximity to Canada (and the nation's busiest commercial border crossing), direct flights to Asia, and its plentiful routes to India and Europe. The updated North and McNamara terminals make Detroit even more attractive, not just because of the impression a new, modern airport can give but because of the amenities it can offer.

"It's one of the the best in the world," Ficano says. "In terms of attractiveness that will definitely help the airport. It is your handshake and your calling card... It's your initial impression. I've been to many airports, and ours leaves one of the best impressions."

What also bodes well for Detroit is "we have thousands of acres of land with proximity to both Ann Arbor and Detroit.... We also have an intermodal system. We can reach 60 percent of the U.S. population overnight, not to mention Canada."

Aside from its built-in characteristics, the Aerotropolis now has more legislation behind it and that could make Michigan more appealing to companies needing ready airport access.

Last week, the Detroit Region Aerotropolis became the first certified Next Michigan Development Corporation. As such the Aerotropolis can offer new tax breaks to its development settlers, those companies that require what's called multi-modal access to compete. In Detroit that's the freeways, the Detroit River and Great Lakes, and miles of rail. Being certified also gives the Aerotropolis access to grants and programs offered by the Next Michigan Development Corporation.

Meanwhile in Washington last week U.S. Congressman Hansen Clarke inserted an amendment into a reauthorization bill for the FAA that, if passed by both houses, will require the U.S. Secretary of Transportation to encourage the development of Aerotropolis systems. The bill was authored by a Tennessee congressman aiming to promote the Memphis Airport and what's been dubbed "America's Aerotropolis."

Of course GE and the companies it will attract are pluses for Aetrotropolis, and because of the auto industry Michigan is flush with engineers and other skilled employees prime for the industries attracted to it.

Ficano says GE is already getting bigger and showing other companies that Michigan is a great place to do business. "They keep expanding. They started with 1,400 employees. Now they're up to 1,800 and moving into another building for aviation research."

He likened GE's investment to "what Hewlett-Packard was to Silicon Valley."

In another development happening in recent days, the Detroit Regional Aerotropolis board hired Applied Storytelling and the Kosmoski Group as the marketing and communication planning agency. One directive for the agencies is to better brand the Aerotropolis so that the general public understands its importance and implications.

"I think people are starting to understand it. I think they were quizzical a few years ago, but they are starting to understand it," Ficano says.

To understand the project is to know that it is an example of regionalism -- a cross boundaries cooperative of governments that have agreed to work together to attract business is better than working against each other.

"You can't work in your own silo anymore," Ficano says.

It's a kumbaya not often seen in government.

"This is a group where we drop all the politics and just work together," says McDaniel, the head of county government in Washtenaw.

What will also sell companies on Detroit is the presence of several strong research universities, a key component to success.

Also crucial to making the project work is buy-in from local leadership. Luckily, the Aerotropolis' biggest public opponent, Oakland County and Oakland County executive L. Brooks Patterson, has warmed up to the idea. Not that long ago Patterson complained about businesses being poached by the Aerotropolis. He called proposed incentives unfair and in a story in Crain's Detroit called the Aetropolis-related bills, "another example of the never-ending torrent of legislative bull---t out of Wayne County."

Since then Oakland County's new view is that such a development, if successful, could be good for everyone.

"Oakland County considers economic development anywhere in the region a benefit to all in southeast Michigan. Just as Oakland County has recognized the strength of its emerging sector of life sciences, and created the Medical Main Street branding strategy, Wayne County is building on its assets of Metro Airport and Willow Run through Aerotropolis. A key point of the Aerotropolis bill is that everyone from the counties down to the cities, villages and townships has access to the same economic development tools," says Bill Mullan, media and communications officer for Oakland County.

Where do we come up short?

While the check marks are stacking up in the pros column, there are some significant cons to consider.

First and foremost, would be the region's lack of light rail, an infrastructure improvement that many cities around the nation have embraced but Metro Detroit has struggled to initiate. It's a significant deficit in our regional portfolio.

From Phoenix to St. Louis to Portland, Ore. to Salt Lake City, light rail has become a successful development tool for cities seeking to evolve their economies. Ficano hopes and is urging light rail proponents and government officials to get on board and make it happen, especially the line from Detroit to Ann Arbor. "We really need to move on this," he says.

Funding is also crucial. Money is not only needed to market and recruit, but to prepare land and infrastructure and utilities, which are lacking in some areas. The region's Aerotropolis may be failing to take into account the quality of life for residents of an airport city, relying on old suburban development models with a professional population that expects more urban environs.

Still, Robert Ficano, Wayne County executive, believes Detroit is perfectly equipped with outstanding airports and a skilled workforce to compete and win. "This is a long-term, sustained development," he says. "We are talking about a project that will take years."

McDaniel urges patience.

"It's baby steps. It is tough when you have the vision and you can see and you can feel it, but you know it's going to take a long time and it may even extend beyond the current players. But nothing great happens unless someone starts it and works toward it," she says. "Keep your eye on us. Sometimes it's a little long and dreary, but you have to see what comes out on the other side."

- Kim North Shine is a Detroit-area freelance writer and the development news editor for Metromode. Her previous feature article was A Better Landing.

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