10 - The Michigan Daily - Tuesday, May 29, 2001



BUILDING
Continued from Page 1
Howard Frehsee, who owns the build-
ing through H & K State Street Devel-
opers LLC, said the development is
consistent with the city's goals and the
proposed height is necessary to cover
tie expense of construction.
"Had we only been able to build six
stories, this project would have crashed
and burned," he said.
Frehsee said he understands the bene-
fits of preserving State Street but other
factors must be taken into account.
"Times have changed," he said.
"There's only so much land in Ann
Arbor."
Building up is one way to combat
urban sprawl, he said.
This is not the first tall building to
grace the skies of downtown Ann Arbor,
Frehsee said, citing the 15-story Campus
Inn at 615 E. Huron Street and the 26-
story Tower Plaza at 555 William Street.
Doug Cowherd, co-chair of the
Huron Valley Group, the local chapter
of the Sierra Club, opposed the pro-
posed development.
"It would be grotesquely out of scale

with the surrounding area," he said.
Cowherd said he was also reluctant to
believe the building would add to the
area, saying a large development would
make it less attractive. Instead of draw-
ing people to the area, the project could
have the opposite effect and repel possi-
ble residents, adding to the problem of
sprawl, not preventing it.
Frehsee countered that argument, say-
ing the development will add character
to the area. He said he plans to construct
a modern, eye-catching building in
place of the current eye sore.
"Our project is going to take away a
lot of the blight," he said. "We think
it's really going to improve the
streetscape dramatically."
Margaret Leary, vice chair of the plan-
ning commission, acknowledged the
development has its drawbacks but said
it is legally viable and also has benefits.
"A development that provides as
much housing as this one will is impor-
tant," she said.
Leary added the building's proximity
to downtown Ann Arbor provides a cen-
tral location for its residents, making it
possible for them to live within walking
distance of their jobs. Besides the plan's

The building that used to house an Olga's restaurant at the comer of State and
Washington Streets Is slated to be demolished and replaced with a high-rise.
potential for cutting down on the use of larity in other urban areas as well, she
cars, Leary said the development could added. They provide for economically
bolster retail and entertainment in the healthy cities and place housing, office
area as well. space and retail shops next door to
This plan to combine retail and each other.
housing is only one of a crop of similar Frehsee declined to estimate how
proposals near campus to gain the city much the project will cost or when
council's approval in recent months, construction could begin. "We're
Leary said. Mixed-use developments going to move full speed ahead," he
are sprouting up with increasing popu- said.


Preliminary
estimates '
shoe gains
in revenue
R EVE NUE
Continued from Page 1
After the 1997 football team's cham-
pionship season, revenue from royal-
ties dropped considerably, plummeting
from $5.3 million in 1998 to $3.4 mil-
lion for 1999. Revenue continued t
fall to $2.8 million for 2000 and the
athletic department was expecting a
decrease to $2 million for this year.
"Over the past two years we have
experienced about a 30 perce
decline," Winters said. "WehU
budgeted another 30 percent decline
this year from last. The good news is
royalties aren't going down any fur-
ther."
But this year, officials are projecting
licensing revenues to be closer to the
$2.8 million that they were in 2000, i
not more. Winters points to the
"volatile" nature of the merchandi
industry to explain the decrease
licensing revenue over the past several
years, as indicated by the bankruptcies
of Starter and Pro Player, two majo
manufactures.
"The industry as a whole hac
declined," Winters said. "We had go
hit worse than others. It appears the
worst is over."
Officials also project monetary gif
donations to increase 10 percent fro
last year, a category in which the ath-
letic department was not expecting
increase.
Winters cites efforts to broaden th
circulation of donations and increase
donations from the Victors Club as th
principle reasons for the donatior
increase.
Despite both these increases, the ath-
letic department is still projecting a
$3.3 million deficit with $43 million is
revenue and $46.3 million in costs.
To make up for deficit, the athlet
department will pull from a three millio
dollar "discretionary transfer" from th
president's unrestrictive gift accoun
while the rest will come from departmen
reserves which have been accumulate
from previous surpluses, Winters said.
AGUut Execuiv
of & Week
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