Gilbert’s Trojan Horse: Capturing the City Core

By Antonio Rafael and Matthew Irwin

Local activists and pundits have, rightfully, ridiculed Detroit’s new downtown streetcar, the QLINE, also known as the M-1 Rail. It covers only three miles of prime real estate (only 5 percent of the city), stands apart from a larger rapid transit plan, serves sports fans and tourists, and relies on outdated technology that has proven unreliable in other cities. The project also went about $40 million over budget, and covers the same route as the Woodward Ave. bus, which actually goes much faster. The QLINE’s intended public clearly is not the 26 percent of Detroit residents who don’t have cars.

Less prevalent in local debate is what lies beneath the QLINE—namely, the intention to develop Detroit as a Third Coast Silicon Valley by Detroit’s very own white savior, Dan Gilbert. The Quicken Loans founder and real estate mogul, whose lending practices helped to propel Detroit’s financial crisis, used the QLINE to install Rocket Fiber, Detroit’s first gigabit internet provider. The fiberoptic cable that makes Rocket Fiber possible runs literally underneath the streetcar line to Gilbert’s newly renovated downtown properties, offering connection speeds around 100 times faster than standard lines (on par with Google Fiber).

The project is the culmination of Gilbert’s decade-long land grab that accelerated in 2013 with the state’s forced implementation of Emergency Management. That system imbued a single person with the power to decide, with impunity, when and how to sell off assets, fire elected officials, and rearrange finances to pay bondholders. Between Gilbert’s real estate and technology investments, he is setting up Detroit for a San Francisco-style gentrification storm.  [Sources: Motor City Muckraker, Detroit News, Progress Michigan Study, Detroit Free Press, DBusiness.]

Dan Gilbert’s empire includes a slew of businesses at the intersections of finance, private equity, urbanism, entertainment, sports, and gambling, many of them under the Rock Ventures umbrella. After squeezing a $50 million tax break out of Detroiters, Gilbert opportunistically relocated Quicken Loans headquarters from the wealthy sprawl/suburb of Novi to downtown Detroit in 2007. However, his downtown buying spree began in earnest when the city was desperate after the 2008 real estate crisis. In 2008, he acquired One Woodward, a 29-story skyscraper situated at the head of Woodward Avenue, for $8.4 million—a steal, given that the same building sold for $20 million a decade before. Gilbert and his companies went on to buy more than 95 properties on or near the Q-LINE, in many instances paying $10 or less for vacant city-owned land and buildings he promised to develop later. Perhaps his most ostentatious of these purchases was the Z, a parking structure that he bought for $1 and adorned with murals from 27 international street and graffiti artists.

With his properties as the center, Gilbert announced his plan to develop retail stores, apartments, and offices along Woodward—an effort he branded “Opportunity Detroit.” He made the announcement on the same day that a lame duck legislature passed Public Act 436, a referendum-proof Emergency Management law. Public Act 436 overturned a successful statewide ballot initiative rejecting the previously enacted emergency manager law, Public Act 4. Before the legislature acted, Gilbert endorsed emergency management at a press conference for the Detroit Economic Growth Corporation and his venture capital fund Rock Ventures in March 2013. He said, “As hard as it is to suspend democracy for a short period of time, I think it’s in the best interest of everyone.” With government out of the way, Gilbert worked directly with bankruptcy lawyers and others to purchase and renovate buildings along Woodward, from I-75 to the water.  [Sources: PR Newswire, MLive, Crains Detroit, Detroit News]

The 21.5-mile-long Woodward Avenue (Michigan Highway 1) has long been the symbolic aorta of Detroit industry— legendary as the former site of Highland Park Ford plant, Hudson’s Department Store, and the 1967 rebellion. Today, the route carries Dan Gilbert’s redevelopment scheme, both by “modeling” the city’s potential in the hope of attracting young (tech) entrepreneurs and by providing Gilbert with the means to cash in. But a deeper look into Woodward’s history reveals not only the city’s settler colonial origins and its history of labor exploitation, but also a pattern of investment and disinvestment that benefits land speculators. Gilbert is only the latest beneficiary of this cycle. Once known as the Saginaw Trail, Woodward exists on top of a Native American trade route, one of many throughout the nation making the U.S. trade and expansion possible that pioneers, statesmen, and militia depended on for survival. Well-known as the first highway in the United States, Woodward was fully paved by 1916. Construction and modification continued into the mid-century often utilizing prison labor and repeatedly forcing the removal of residents and businesses. Further development along the highway in the mid-1920s contributed to the mass exit of industry into the suburbs that took place in the 1960s. M-1 not only connected cities and neighborhoods from Detroit to Pontiac, but routed infrastructure investments away from the city, providing the American model for suburbanization.

As Detroit put the country on wheels, it gave white people the option of leaving “dangerous” urban areas. With his properties secured in downtown Detroit, Gilbert has driven the current period of investment with a distinct anti-black narrative. Macroeconomic trends that led to Detroit’s decline are blamed on black management. Nearly 50 years of black leadership are blamed for industrial (white) flight. In this story, Detroit is now an “opportunity” for young hip pioneers to settle the “empty” lands created in part by Quicken Loan’s aggressive subprime mortgages.   [Sources: Detroit Free Press (Burton Historical Collection, Detroit Public Library), Indigenous People’s History of the United States, by Roxanne Dunbar-Ortiz]   

The QLINE is the first private-sector public transportation initiative in the U.S. to hijack a  federal grant originally issued for a citywide rapid transit system, in this case for $25 million. Out of a total cost of $238.6 million, $105.2 came from foundations, private corporations, and hospitals. Gilbert contributed $10 million, more than any other single donor—with half of it going to the naming rights, transforming the M-1 Rail into the “QLINE.” With $140 million going to the purchase of the streetcars and the laying of the tracks, the remaining $98.6 million will update infrastructure and pad operations for the next decade, because the QLINE will need to be the second most popular streetcar in the country to pay for its own operating costs.

Even with this investment, Gilbert’s toy train will not be enough to fill his buildings and inflate his property values. Enter the tech sector: While the street was torn open for the M-1 rail construction, an idea for a new company took root. Seeded by some of Gilbert’s employees and fertilized with a $31 million Rock Venture investment, the scheme involved fiber optic cables installed below the QLINE, forming the “spine” of Rocket Fiber’s in-ground infrastructure, connecting Wayne State/Midtown to Campus Martius, what we’ve come to know as Gilbertville. Rocket Fiber saved millions of dollars on the deal, avoiding the costly process of tearing up streets or running fiber on telephone poles. So far the company has laid over 30 miles of fiber throughout many of the newly renovated Gilbert buildings along Woodward. Public Relations from the Gilbert team report Rocket Fiber won a “competitive bidding” process to provide free wifi service to the QLINE and at the 14 train stops along Woodward. It must be hard to compete with the internet provider that fed its wires underneath the track. Three miles of free public wifi is hardly an equal exchange for the millions of dollars Rocket Fiber saved with the QLINE installation—all for an internet service that exceeds the needs of the average internet user. In other words, Gilbert’s service is a pitch to the tech industry and related industries, such as finance. He wants them to pay rent and buy into the new network at his downtown properties. [Sources: RocketFiber.com, CrainsDetroit.com, OpportunityDetroit.com, transportation.gov]

The QLINE maps Gilbert’s takeover of Detroit. It represents the latest upturn in the investment/disinvestment cycle on Woodward Avenue, continuing a process that began with depictions of the city as an “urban wilderness.”  “Ruin porn” and stories of resurgent nature made the city visible to tourists seeking tales of adventure, disaster, failed industry, and resilient people. Adventurous young entrepreneurs and artists, hearing these tales, moved to the city to build their businesses and make their work on terra nullius, land represented as empty. Like nineteenth century pioneers on the Western frontier, these urban settlers made the land more attractive to investors and helped to increase property values. Their run-ins with squatters justified a regime of law-and-order.

Traversing less than a sixth of Woodward and disconnected from the larger metro system, the Q-line is not a solution to the city’s transportation problems.  It is a narrative device, designed to demonstrate the city’s capacity for change at the same time that it detours the racializing and racist processes and policies that have sustained a century of investment/disinvestment in Detroit, from redling and neighborhood covenants to water shutoffs, tax foreclosures, and opt-out clauses on cross-county transportation routes. Even negative coverage of the Q-line project brings it and the city into view, while suggesting that city administration and its corporate sponsors have the ability to get things done in the face of opposition. In short, the Q-line increased Detroit’s visibility to Gilbert’s primary audience—tech entrepreneurs. [Sources: Detroit Free Press (Burton Historical Collection, Detroit Public Library), “‘Your Wilderness’: The White Possession of Detroit in Jim Jarmusch’s Only Lovers Left Alive” by Matthew Irwin (Capitalism, Nature, Socialism, Dec. 2, 2016), Out of Nowhere: Disaster and Tourism in the White Mountains by Eric Purchase]

In a city where 40 percent of the population doesn’t have internet access, Rocket Fiber, much like the QLINE, isn’t meant for Detroiters. It’s intended to fill Dan Gilbert’s properties with tech workers, self-styled urban pioneers eager to gentrify/settle the city. It’s no secret that Gilbert imagines Detroit as another, if not the “next,” Silicon Valley. His $1.6 billion investment in Detroit real estate included a portion for tech business incubators.

Around the time Gilbert’s land grab in Detroit began, he also started the nonprofit Bizdom to provide office space, training, and up to $125,000 in startup funding for young tech entrepreneurs. In 2011, he purchased the Madison Theatre building on Broadway to open a tech hub he christened M@dison. In 2012, Rock Ventures rolled out “IT in the D,” a program to give local university students real-world tech experience and the “Valley to Detroit” campaign to recruit laid-off Silicon Valley techies. These programs took off at the very same moment that the state implemented Emergency Management.

In 2014, Gilbert made his pitch at the TechCrunch: Disrupt San Francisco annual conference: come to Detroit, there is opportunity for innovation and cheap real estate. The plan seems to be working. Among the more than 60 tech start-ups that claim Detroit as their home are Cribspot, which maps off-campus rentals for college students; Remake Detroit, which tells stories about products made in Detroit and the people who make them; and, not surprisingly, Kidpreneur, which teaches entrepreneurship and technology to kids. Adding corporate credibility to Gilbert’s vision, in late 2015, Amazon opened a corporate office in Detroit, and, at the beginning of the 2017, Microsoft announced the relocation of its Southfield office to downtown Detroit. [Sources: Detroit Free Press, GrowDetroit.com, WXYZ.com.]

To understand what all this tech development means to Detroiters, just have a look at San Francisco’s Mission District, where politically themed murals beautify the streets of a neighborhood that the average artist can’t afford. Tech industry gentrification is relentless and total, often literally hidden behind public art projects that make the city more appealing to white people, like Shepard Fairey’s mural/brand on Gilbert’s One Campus Martius property.

More importantly, “creative city” initiatives help to deflect criticism from gentrification by recasting arts and technology as new American industries, lifting up the city. Indeed, the Detroit Institute of Arts, which sits on the QLINE route, attempts to historicize and naturalize this transfer to the new economies by claiming on its website that Diego Rivera’s industry murals depict industry and technology as the “indigenous culture” of Detroit. This is, of course, another deferment of the real conversation: real estate is the industry of the U.S. and has been from the nation’s very earliest conception of itself as an inheritor—rather than a beneficiary and legislator—of settler colonial conditions. The architects of Detroit’s bankruptcy, like Dan Gilbert, have perpetuated these conditions through disinvestment and depopulation, portraying their speculations on land as acts of benevolent redevelopment. Debt in Detroit has been used to rationalize land, water, and privatization for the benefit of the white and wealthy. [Sources: DIA.org, New York Times]

Despite the hegemonic force of Emergency Management and its related technologies of exploitation and dispossession, Detroiters have not been silent. Detroiters Resisting Emergency Management organized firefighters, welfare rights advocates, activists, and community organizations to lead protests such as the Motown Slowdowns and other civil disobedience actions. In the face of land grabs and subsidies for corporate development, Detroiters have been advocating for community benefits and more local participation with projects such as the Community Benefits Agreement. The North End Woodward Community Coalition also galvanized residents and faith communities around transportation justice, specifically concerned with QLine’s effect on the North End community.

When Allied Media Projects learned of Gilbert’s plans for the Rocket Fiber install along Woodward Ave, they pushed for free public Wi-Fi in the Cass Corridor as an exchange for Detroit’s investment in Gilbert’s project. Since 2009, AMP’s Detroit Digital Justice coalition has been working on creating more and more equitable access to internet services, and, in 2010, AMP launched the Digital Stewards Program to train citizens in organizing and hardware installation to create mesh wireless networks for marginalized neighborhoods. Through that program, AMP fomented the deal with Rocket Fiber, squeezing out one gig per second wireless signals to neighborhood hubs located at Grace in Action in Southwest Detroit, WNUC community radio station in the North End, and Church of the Messiah in the Islandview Village neighborhood. Rocket Fiber sells the service to the programs at wholesale and a cadre of nonprofits and business development organizations currently pick up the bill. Over the long term, each neighborhood community will be responsible for managing and paying for their own networks, and the question is how they can do it without duplicating the systems of dispossession and dislocation the program is meant to combat.

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