Plans for a new three-story, mixed-use building in the Old Fourth Ward Historic District are moving forward after winning approval from the Ann Arbor City Council.

Dan Williams of Maven Development intends to demolish the 560-square-foot former gas station at 544 Detroit St. and construct a 4,077-square-foot building in its place.

The first floor is expected to contain 857 square feet of office space, while the second and third floors contains 1,557 and 1,663 square feet of residential space, respectively.

The plans show one condominium on the second floor and one on the third floor. Each story is expected to have steel balconies featuring metal work by a local artist.

The City Council separately approved a site plan Monday night for two retail buildings totaling 8,490 square feet at 3945 S. State Road.

That includes a one-story, 1,700-square-foot Jimmy John's with drive-thru facilities, and a one-story, 6,790-square-foot retail building behind the restaurant.

The property is northeast of the State-Ellsworth intersection; it's between Research Park Drive and the new Tim Hortons.

The flatiron-style building proposed for Detroit Street won approval from Ann Arbor's Historic District Commission in October, and then received Planning Commission approval in December. The plans include four covered and one uncovered parking spaces on the ground level.

Modifications were approved to allow the developer to exceed the 35-foot height limit by 3.5 feet, to reduce the front setback requirement along Detroit and Division Streets from 10 feet to 5 feet, and to reduce the rear setback from 30 feet to 7.5 feet. City Planner Jill Thacher said the lot's configuration would render it unbuildable without setback modifications.

A landscape modification also was approved to reduce the conflicting land use buffer along the rear property line.

The city's Brownfield Review Committee recommended approval of a brownfield plan for the project in late May, and the City Council gave its blessing Monday night.

The brownfield plan now advances to the Washtenaw County Brownfield Redevelopment Authority to authorize tax-increment financing to reimburse the developer for costs associated with the project.

The overall investment for the project is estimated at $1.5 million, with "eligible activities" for reimbursement in the brownfield plan totaling $698,773. That includes soil remediation ($174,620), infrastructure improvements ($70,350), and vapor mitigation ($32,000).

The property qualifies for brownfield financial incentives because of the presence of petroleum hydrocarbons in the site's soil and groundwater.

Ryan J. Stanton covers government and politics for AnnArbor.com. Reach him at ryanstanton@annarbor.com or 734-623-2529. You also can follow him on Twitter or subscribe to AnnArbor.com's email newsletters.