Long-empty Pinball Pete's building signaled South University redevelopment potential

It is unclear this morning whether the building will now have to be torn down or remain boarded-up.

The site been in a potential state of flux for years.

The property was bought by the Tice Family Partnership, according to city records, in 2001 for $700,000.

Three years later, it was listed for sale - and it stayed on the market for some time. Unclear this morning is whether it was an active listing at the time of the fire.

The property generated a lot of development interest due to the listing. But the price - $1.2 million in early 2004 - resulted in no serious proposals that ever were made public.

“It was off the radar because it was so expensive,” said Jeff Harshe of MAV Development in Ann Arbor. “It was hard to figure out what to do with the property that would make sense.”

The difficulty, developers have said, is the size of the lot: with 26 feet of frontage and 132 feet deep, the price and area combined to make a tall building the only viable option. The city assessor set the land value at $239,000; annual tax payments were about $8,600.

But the discussions about what that could mean on that property helped drive discussion - and policy - about development in downtown Ann Arbor.

“We want to create an environment where there’s incentive for property owners to develop property,” Maggie Ladd told me in early 2004.

Ladd, director of the South University Area Association, submitted a zoning application right before that conversation, seeking greater building height in that area.

Discussions about height and floor-area ratios in the South University district led to broader conversations about downtown building height.

It was a pressing issue in 2004, as developers sought to capitalize on the vibrancy of downtown and its proximity to the still-growing University of Michigan campus. One example of how the additional height in that district came to fruition: Zaragon Place, the student housing high-rise that opened this year on East University.

And one example of how changes in what was allowed generated backlash: The original proposal for University Village, which called for up to 26 stories of housing at the corner of South University and South Forest. It later was renamed 601 Forest and downsized to 14 stories.

Today, downtown building height is a less pressing on the submitted-project front: Economics of development downtown don’t work in this recession, which comes with limited capital availability.

But Ann Arbor is still trying to determine the best guidelines for what can be built and where. The A2D2 design guidelines will be formalized soon, and the city is hiring a new planning director to lead big-picture planning guidelines for the city.

Ladd’s original effort to add density to South University was driven in part for a greater diversity on the street.

Years ago, it catered to a wide variety of Ann Arbor residents.

Today, it’s largely student-oriented retail - both stores and bar-restaurants - with a smattering of U-M offices. Among the retail: The “new” Pinball Pete’s, in the Galleria building on the south side of South University.