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Developer Asks To Lease Lot

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Developer Asks To Lease Lot

By Ron Cordray

A tentative proposal that the city lease its S. University parking lot for development of a 400-space carport was presented to the City Council last night.

If constructed, the parking structure would help solve the problem of parking cars expected to be generated by construction of an 18-story apartment building at the corner of S. University and Forest Ave.

Towne Realty Inc., developers of the high-rise apartment building which has no facilities for off-street parking, is very much interested in this type of project. 

William J. Bott, executive director of the Chamber of Commerce, presented the proposal to the council. “Some weeks ago, we suggested to Towne Realty, Inc., of Milwaukee, Wis., that they give consideration to the construction of an off-street parking structure, built on what is now the municipal parking lot fronting on S. Forest Ave.,” Bott said.

Bott then noted that Towne Realty “is definitely interested in building such a structure, and that their initial proposal” was outlined in a letter to the chamber.

Under the proposal the firm would lease the land from city for $10,500 per year and 10 per cent of the gross receipts on the additional spaces 108, the number of spaces currently at the parking lot.

If the city were required to purchase additional properties bordering the lot to make room for the structure, the firm would pay the city an advance rental so the city would have sufficient capital to buy the properties.

The form indicated that it "would move on the project within 30 days after reaching a mutually satisfactory lease agreement,” he added. “It is my earnest hope that the City Council will give immediate and favorable consideration to the proposal submitted by Towne Realty, Inc.,” Bott said. “I feel that their proposal is extremely sound and beneficial to all parties concerned."

Initial plans of the firm call for the parking structure to consist of four ramps with the first two decks for metered parking and the top two decks for “permit” parking. “The latter would allow area residents an opportunity for off-street' parking on a fixed monthly fee basis,” the firm said.

At the end of a period of time, such as between 55 and 75 years, the city would inherit the residual value of such parking structure, however, reserving to us an option to renegotiate the lease on the basis of first refusal to meet any other offer for lengthening our lease term,” it added.

Towne Realty said it would stand the entire cost of improving and building the parking parking structure; however, the placing of meters and operation of the parking lot as such would be done by city of Ann Arbor.

The firm added that it is investigating whether additional acquisition of land is necessary to erect the structure.

Bott told the council that revenues under the plan would exceed current city income from the parking lot.

City Administrator Guy C. Larcom Jr., stating the matter should be discussed at a working session, told the council a report on the projected revenues of the lot as it now exists and the cost of operating a carport would be presented.

During the past few weeks numerous Ann Arbor residents and students have protested the construction of the 18-story apartment house without off-street parking facilities. It is believed the construction of a 400-space carport would do much to solve the problem of parking. However, the Chamber of Commerce noted, that parking permits would be sold on a first-come, first-served basis and would not be reserved for residents of the new apartment building.