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It's Good To Have Land

The silver lining in Detroit’s economic downturn of the last oh, decade or so is that the metro Detroit area is now having a fire sale for emerging businesses. While “The Great Recession” continues to wail away at the real estate market, metro Detroit’s cash crop of affordable rent and labor offers a cost-cutting measure to growing businesses that, according to Grubb & Ellis, a real estate investment and consulting firm, is lower even than what is available in southern cities like Atlanta, Orlando, and Dallas where Michigan jobs have fled for the past ten years, lured away by cheap wages and no unions.

Also, it seems that Detroit’s blue collar work ethic has lit a fire under CEOs watching the “savings” from outsourced labor vanish as the global economy corrects itself. Just last October Systems in Motion, a Freemont, California outsourcing firm, set up a delivery center in Ann Arbor where 35 employees do information technology work normally done in India. Debashish Sinha, Chief Marketing Officer was quoted in the Detroit Free Press as saying, “It’s actually substantially less expensive to set up infrastructure in Ann Arbor than it is in Bangalore,” adding “I love the Midwestern work ethic.”

While it makes sense that Michigan’s initial economic recovery would take root along “silicon alley”, the nickname for the corridor along I-94 between Detroit and the University of Michigan, the question remains as to whether or not it will ever spread to the City of Detroit itself. Ever since forced bussing redistributed the city’s residents over sixty years ago, an uneasy economic balance has been kept between the city and it’s outlying suburbs through economic siege and counter siege, a history which residents on both sides of eight mile must struggle to overcome if either is to move forward.

In Metro Detroit today, a debate raged over how best to manage Urban Agriculture in Detroit. Nonprofit and for-profit plans for the city of Detroit clashed at University of Michigan’s Dearborn campus where businessman John Hantz proposed transforming the cities vast potential for Urban Agriculture into a lucrative business. However, as the CEO of Hantz Farms, many in the audience questioned aloud whether or not Hantz’s motives were in the best interest of Metro Detroit. After all, the last time the Detroit residents bought into an outsider’s “economic vision for Detroit” it brought us companies like Rock Financial, whose subprime lending in the thick of Michigan’s ten-year recession have given us the blasted landscape we see today.

However the gut reaction that Detroiters feel when anyone outside the boundaries of the city proper suggest what might be best for the city’s residents hasn’t been the best metric by which to assess economic opportunities and the stakes this time are quite high. The potential profits for urban farmers in Detroit are vast, as the city’s reduced population and wide tracts of unused land offer annual harvests far beyond what would be needed to feed the city’s residents. Add to that the positive cash flow of being the first major American city that can feed itself without export, and the profit margin nearly doubles. Add again the rise of developing nations and the global demand that follows and the potential for growth in Metro Detroit is almost beyond calculation. Finally, add to the whole equation that John Hantz is not an outsider to the city of Detroit and his strategy for economic revival might start to seem considerably more appealing.

The City of Detroit itself is what is called a “food desert”, meaning that obtaining fresh produce is nearly impossible when compared to how easily accessible unhealthy food is. It doesn’t take much more than a trip to any neighborhood store to find rows upon rows of chips, candy, and soda and mark the absence of anything leafy or green. Compound that over Detroit’s 2000 square miles and what we have in the city of Detroit is not only a long-wasted economic opportunity, but a health epidemic that could easily have Detroit leading the nation in childhood obesity in as little as five years.

Headquartered in Detroit, John Hantz and Hantz Farms are both residents of the city of Detroit and have been for twenty years. After contacting his office for a more measured conversation than what was available in Dearborn today, I had the opportunity to go over his plan at length and learned more about the man than his earlier turn as a suit behind a podium was able to provide.

Part of what might make Hantz’s vision so unsettling to Detroit’s residents is that it seeks to establish scarcity of land. The plague of abandoned, tax-delinquent properties are a burden on all the city’s residents and the only way to lift that tax burden and raise the property values for all the city’s residents is to eliminate them. This is where Hantz’s plan runs into opposition, and rightfully so, as the debate over who will come to own these now worthless, but soon-to-be valuable, tracts of land comes to the forefront.

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