Why Detroit is Built to Succeed: Looking at Detroit’s Past to See Its Future
Detroit Tigers 2008 Net Economic Impact from Attendance
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As part of its dealership restructuring efforts, one of the Detroit Three invited current dealers to submit proposals for a new luxury vehicle dealership in suburban Detroit. Our client, a large dealership group in the Detroit area, retained us to assist in evaluating the OEM’s preferred site and an alternate site that was believed to be better positioned in the market.
We began with an assessment of the current dealer network in Wayne, Oakland, and Macomb counties. This included a drive-time analysis to assess market coverage, both for the current structure and for the structure after the known dealerships closing. We next identified the most likely site for a new dealership in the OEM preferred area and our client’s preferred area, and delineated a market area for each, accounting for drive-times, infrastructure networks, natural barriers, and the market areas for existing dealerships. A demographic and socio-economic analysis was done for each trade area, focusing on variables that predict the success of luxury automobile dealerships. We also analyzed luxury vehicle registration data from RL Polk to measure historic vehicle purchase patterns in each market. Lastly, we considered site specific factors, such as visibility, traffic count data, and proximity to other luxury vehicle dealerships.
Our final results were summarized in a memorandum and presentation to the client, and found the client preferred site to be a much stronger location. Our deliverable included summary data tables and custom maps showing market areas, demographics, and luxury vehicle registrations. The memorandum and presentation was included by our client in their proposal to the OEM.
The Detroit News
The City of Detroit, founded in 1701, is one of the nation's largest cities, and the center of one of the nation's largest metropolitan areas. The City of Detroit sought the review of its existing Renaissance Zones, which were originally designated by the state in 1996 and then expanded with the assistance of our firm in 2000. The city again retained Anderson Economic Group to aid in the review, revise the criteria, examine opportunities and costs, and recommend action by the city. A review committee including our project team, the city's planning and development department, the Detroit Economic Growth Corporation, and the city assessor's office recommended that the city not extend their existing zones at the time, given the results of our cost/benefit analysis and statutory review.
The city requested our review of a new federal law establishing a “Renewal Community” economic incentive program. Our analysis revealed the city would be a candidate for such a designation, and we recommended that the city file an application with HUD.
Anderson Economic Group advised the City of Detroit Planning and Development Department during the Renewal Community application process, outlining an appropriate process, identifying specific tax benefits to employers and investors, preparing documents and graphics summarizing economic conditions, working with State economic development and housing officials to confirm a course of action, and analyzing census statistics to define the best qualified application area. Our project team, with the City of Detroit, produced and delivered to HUD the entire application packet within 15 business days.
HUD’s review process followed a competitive procedure outlined in the Code of Federal Regulations, under a federal law that limited designations to the 40 most qualified. The designation was awarded to the city on January 18, 2002, making it eligible for $17 billion in development and tax incentives.
Regardless of how much these baseball fans spend before, during, and after the games, it is a safe bet that the Detroit area economy has benefited from extra attendance at Tigers’ regular season games, and will further benefit from the playoff games. Our analysis concludes that..
Press Release For Immediate Release, February 1, 2006Contact: Scott D. Watkins, Consultant, or Patrick L. Anderson, Principal Super Bowl to Bring Significant Boost to Detroit Area Economy Though many impact estimates exaggerate benefit, Super Bowl still expected to generate millions in new economic activity.$49 million benefit compares with 2004 Ryder Cup. A report released today […]
Patrick L. Anderson
An analysis of the 1999 residency requirement imposed by the city of Detroit.