Are suburbs now on defense against Detroit?

Could it be that Detroit will start stealing away business from the suburbs based largely on a vibe, a feeling that the city is the place to be?

That’s a question that would have drawn hearty laughter from suburbia 20 years ago.
It’s a suggestion that would have been dismissed as wishful thinking on the part of Detroit officials 10 years ago.
But it’s a real possibility in 2013, so much so that officials in Macomb County and across the suburbs should get ready to play defense.

Campbell Ewald’s decision to move back to Detroit from Warren, announced on Wednesday, may mark a sea change in Metro Detroit economic development. The relocation was a bold move for the marquee advertising agency, but it also reveals a new way of thinking among Detroit area business owners and CEOs.
City Hall may be broke but the downtown area is drawing new businesses at a rapid rate because it’s the cool place to be.

Bill Ludwig, CEO of the 600-employee ad agency, said that the decision was “a cultural one, not a financial one.”
Civic leaders such as multi-billionaire Dan Gilbert of Quicken Loans and Tom Lewand, president of the Detroit Lions, recruited Campbell Ewald, convincing the high-profile firm to settle into the former Hudson’s warehouse for “cultural reasons” – that’s a phrase that should send shivers down the spines of Macomb County Executive Mark Hackel , Oakland County Executive L. Brooks Patterson and dozens of other political leaders on this side of Eight Mile.
Relocating to Detroit is a trendy move, it’s a show of support for America’s “Comeback City.” The intangibles that impact these decisions – creating a new home in a diverse, resurgent downtown or Midtown that offers arts, culture and entertainment – literally disarms suburban officials such as Warren Mayor Jim Fouts.

Fouts eventually admitted last week that he failed in his bid to keep Campbell Ewald in his city after arguing that Warren offers lower taxes, no city income tax, and less crime and blight.
That was the standard sales pitch that the suburbs employed for decades to steal away Detroit businesses and jobs.
But it no longer works.
Crime in the downtown area rates no worse than in many suburban cities. Blight has emerged as a major concern for Fouts and other mayors of aging, “inner ring” communities. The suburbs now struggle with violent street crime, drug trafficking and rat infestations.

And it appears that urban dynamism now trumps tax rates.

This stunning reversal, from suburbs to city, was initiated by Peter Karmanos of Compuware years ago. He broke the ice. Gilbert created a wave.
Gilbert moved his Quicken Loans employees into the city in 2010 and has purchased 18 downtown buildings since then. Other major corporations that have followed suit by choosing to locate or consolidate in the inner city include Blue Cross/Blue Shield, DTE Energy and (soon) Whole Foods.
The result: 10,000 new jobs for downtown since 2010.

Let’s face it, they have high-rise apartment buildings, stylish lofts, music festivals, artists, the DIA and other museums and some of Michigan’s best concert venues. Based on the votes cast by readers of area publications, they have the “Best of the Best” in restaurants, bars and clubs. They have the new Cobo Center and Greektown and River Walk. They have Campus Martius, street life, Eastern Market and walkable neighborhoods. A new Red Wings arena is on the way and a growing Wayne State University and Detroit Medical Center are key drivers of economic growth for Midtown.

Meanwhile, Campbell Ewald is abandoning a 10-story building on Van Dyke that the firm owns – knowing it may take many years to sell – and is setting up shop in an old warehouse that will be revamped at the cost of a small fortune. Why?
There is an optimism, a synergy about downtown and Midtown, fueled by several national publications, that is alluring. Ludwig talks about creating a “magnetism” that will lure more businesses to the outer edge of downtown near Ford Field.
“We’re just thrilled over here by this (move). It’s another independent confirmation of the excitement we’re all trying to build down here,” said Gilbert, who took Ludwig on several tours of the area to look at available buildings.

What’s more, Lewand said he had taken a very selective approach toward finding a tenant for the Hudson’s facility, which is situated on the Ford Field property.
“It had to be the right guy,” he said. “It’s important that we’ve got the kind of tenants in here that we can not just collect rent from but that we can live with, and Campell Ewald was the right mix for us.”
Can you imagine the president of a major company in suburbia saying that?

It’s also important to recognize that downtown and Midtown are gaining small businesses and specialty shops that give the area a unique character. Woodward is not about to become Hall Road.
In the latest in a series of New York Times stories about a Detroit revival, readers are introduced to a former New Yorker who opened a clothing shop in Detroit, the Peacock Room, in 2011 which proved so successful that she opened another one, Emerald, last fall. She told the Times that she tripled revenue projections in her first year.
The Detroit media has reported on Skidmore Studio, a graphic design firm that moved from Royal Oak back to downtown in 2011 and has already increased its number of employees from 20 to 28. Business is up 30 percent because the company kept all of its suburban customers and added new downtown clients. And the owner says fear of crime is not an issue with any of his employees.

For years, we’ve heard tri-county government and civic leaders declare that what’s good for Detroit is good for the whole region. But we all know that many suburbanites only believed that when the city’s modest gains had no adverse impact on our cities and townships.
The question in 2013 is: Have they snuck past us and now have the upper hand in attracting businesses and jobs and people?
Our suburban officials need to devise a strong defensive strategy – an attractive counter-offer -- to address this trend.

But, I wonder: Do we have anything that compares to Detroit’s charm offensive?