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Abrams Landing: Proposed Luxury Loft Building


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That's nice, I wish more developers would at least read forums such as this, it may give them an idea of what people want, or may spark their interest in something they hadn't thought of before. And, Mr. Fisher, if your reading this, feel free to join in on the conversation! Also, I was wondering if he has explored the idea of aquiring investors to build a bigger building, these days virtually nobody puts up a large amount of their own money to build something big.

Investors..... in theory and discussion, an excellent solution, however, frequently these investors usually want more than their share of control or profit from a project. Also, with this being a project that I intend to have both my office, and my residence, its opens the door for a perception, of a conflict of interest. I tend to have tastes that are a little excessive, and is also a personal characteristic that is not conducive to partners. They want to maximize profit, while I want to build something unique. To really go higher on this project, I figure I would need to add about an extra three stories to make it worthwile to incur the extra costs of the code requirements. That would increase necessary count of units, that the ugly issue of parking would rear its head. I believe that the area can support the parking needs the project, with a unit count of 16-25. Believe me, that I would have LOVED to build a very tall building.

The underground parking option was explored, and was abandoned on two fronts. First the square footage of the parcel, logistically it just wasn't going to work (lanes and required clearances). Secondly, cost, to construct and maintain, are almost as much as the cost to construct the apartments. Another argument for the 'cost of free parking'. To give you an idea of how badly the parking area issue was, if all the supporting beams/posts/and walls were ignored, I could maybe have fit 15 spaces. Clearly not enough. To go down another level, would have reduced the number on the first, and might have still come up short. One of the estimate figures I have used to roughly calculate underground parking cost (one level only) is 35k per parking space. This is why the Arbaugh charges an additional ~100.00 per month for the underground parking. The underground parking also requires massive overhauls every 10 years.

The Arbaugh's renovations were at a cost of approximately 8 million. I believe the Stadium Project is 13 million, while the Capital View building (Boji project estimated at 20 million, if memory serves me). Cross calculating the square footages and making this a very rough estimate it shows just how expensive crossing up over that 55' is. Obviously those are very rough numbers, but similiar to when people roughly calculate 100/sqft for residential, it gives you a generically feasible way to evaluate.

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Is it the cost of the foundation that is excessive with going over 55'? I was always under the impression that if you built something steel and over 5 floors it pretty much meant you have to go with some pretty deep footings. And is 55' the treashold, where prices jump up alot but level off above that or does the cost go up at an exponential rate after 55'? I still think your project will do quite well and if you could find a way to finance it I think you could still make all your money back even if you built taller. But maybe you can use this project to finance a bigger project down the road :D

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Yes, Mr. Gillespie has done just that with the Prudden Place, using it as a stepping stone for the larger Stadium District. Hopefully, if that is successful we shall see something even bigger and better.

I commend Mr. Fisher on taking this risk in a market still in its infancy. It's going to be very interesting to see how this project evolves over time. Hopefully, this will be the start of an overhaul of Larch and Cedar north of Michigan Avenue which currently are a mess in terms of use. The current A-to-Z rental lot is nothing more than a dirty mess in what should be a very happening area of downtown being just a block or two north of the stadium.

Mr. Fisher, are you aware that Action Discount (just next door to your new property) is up for sale, as well? Have you consulted with the owner? I know him very loosely through an former high-school classmate. Have you looked into buying this property, and demoing it to spread the development out a bit increasing the footprint, and perhaps allowing for an increased number in underground parking? This is a tricky area, though, concerning all of the small lots on this block. It's pretty much fully built out, and creativity is a HUGE thing here, and how you put this thing up.

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The cost, or so I have been told (please don't forget I'm a real estate broker and mortgage broker, and not a builder) is from added items for crossing that line. Something about an air exchanger for the stairwells, that cycles in fresh air in the event of fire (so the stairwell doesn't fill with smoke), I was told something about an electrical generator back up that must be installed. Approximately double the amount of fire suppression equipment. The list goes on and on. My architects were looking into it, to list it all out for me and guestimates of cost, all the while warning me that it would probably kill the budget on the project. A conversation with Richard Karp, very briefly threw out a number of 250-300k, which for a project of this size, was the quickest way to shoot the idea down. I would have to add so many units, that I would then need more elevators and possibly more stairwells, thereby taking up more precious square footage, and that may have eliminated a unit from each floor, therefore requiring another floor to make up for the lost units. Its a vicious cycle. Another conversation with Richard, was 'look around, that's why all the new construction is five floors or less'. He had wanted to add a residence to the top of the Arbaugh, and that would have constituted a 'sixth' floor, and he killed that idea immediately, as soon as he found he would have had to retrofit the entire building with the extra items.

As far as the Action Discount building goes, they were asking 750k for it, while Abrams was initially asking 550k. Abrams is larger, lot and building, and fully heated. The Action Discount's second story is supposed an unheated attic. Unfortunatley for that guy, I think once the City Sewer Separation gets underway, that is really going to hurt him, but should push his price down into the realm of feasibility. I am keeping an eye on it, but will finish this project first, before I bite off more than I may be able to chew. I think that the next development that will take place in the area (this is pure opinion here, and not conversations with anyone), Harry Hepler owns the Lansing Machining building. After my project goes in, that will stretch the redeveloped borders a bit, so that the building won't be to far off the beaten path, and his building will have great views of Oldsmobile Park as well.

I know that my building is an interesting and complicated project, but I think Action Discount might be even harder. That may be a good building for a more simple renovation, no height addtions, just rehab what's there. There are really no great views at that site, maybe a decent view down Michigan ave, since Oldsmobile Park is set back so far.

In a better economy it may happen (taller buildings), but I think you are going to find that the tolerance for risk for most developers is going to be that 55' for a while. Besides, what's the worst that could happen, we start to have a downtown that starts to resemble Grand Rapids? I feel that I am taking a considerable risk on this project, I wouldn't do it if I didn't think it would fly, but on the other hand, Michigan is not exactly booming right now. I have always felt that if you have the best property (finishes and features) you will always be filled and do okay, I am counting on that. I have noticed that the only units in the Arbaugh that are not filled are the 2bedroom 1000+ units. The pool of renters in that bracket drops considerably at that price and therefore you either have to make some really cool units to fill them, or scale your project to make it fly at lower rents. Those lower rents, kill the taller building desires. I am shooting for the 2 bedroom loft with superior features at about 1000-1200 range, with the mezzanines the units should be about 1200 square feet. So for a two bedroom they will be larger that most everything else out there.

I see my real challenge is trying to a business that will compliment the area, to fill my second commercial space. I know that a mortgage and real estate shop doesn't improve the night life, so I feel a responsibility to find one that will for the other space.

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While I wouldn't want to nag or anything, you may want to have your architects spend the time to see if building just a little taller (adding 5 or so floors) would be within your budget. Some of the things, such as a generator I don't understand why height would have anything to do eith it, typically in a residential building the only generator needed is one to light up common areas with flood lights, that is even done with battery powered flood lights a lot, so I don't know why the building would need a generator at all. Also I noticed that the cost of steel is another possible reason to prohibit building high, but the cost of steel has dropped 20% in 2005: Steel Prices Fall Sharply. The reason I'm so hung up on this "building tall" thing is for a few reasons:

First, I like tall building's, by tall I mean around 100'+

Second, there is a specific dividing line at which a building "officially" becomes a highrise- 113', the more Lansing has, the better I feel about staying here.

Third, you seem interested in building taller, but you have been told it's not feasable, I have doubts about that, since right here locally the Stadium District will cost $13 million and will be 100,000 sq ft. ($130/sq ft) Capitol View cost $16-21 million ($106-140/sq. ft.), cost including the ramp were $41 m and I'm almost sure that the ramp cost $25m. This also seems odd sense the Stadium District will benifit from (slightly) cheaper steel.

Also, I was wondering if you plan on saving the building or just tearing it down. Personally, I figure you should just tear it down, maybe save the facade of the old building, But I would definately raze the newer part and probably the older part to, just saving the important features of it to put on the new building, that would likely save some money, and actually improve on the quality of the project.

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And, just to add something, here are some key, residential/mixed-use projects going up in other city centers in Michigan. This may be an idea of something we'd be aiming for as downtown builds the critical mass it needs to see larger developments:

Ashely Terrace, Ann Arbor - 10 stories, 94 units, 3 levels of underground parking, construction to start in the spring.

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Website: http://www.josephfreed.com/property_detail...te=Michigan&t=4

The Ellington, Detroit - 5 stories, 55 units, attached parking, completion summer 2006

ellingtonsite91.jpg

Website: http://www.ellingtonlofts.com/

Icon on Bond, Grand Rapids - 9 stories, 118 units, parking beneath main structure on first floor and basement, completion 2006.

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Website: http://icononbond.com/

Ashely Mews, Ann Arbor - 9 stories, 8 unit penthouse rest office space, underground parking, completed 2003.

highrise_oval.gif

Website: http://www.ashley-mews.com/penthouses.html

I will post more later of other's going up in suburban Detroit.

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Hood, adding 5 more floors would be skyrocket cost. I thought he pretty much explained that. This is his personal project, so he's not going to be able to put up a single high-rise by himself. He's not Donald Trump, you know. He's putting up his own money, here. In a perfect world, we'd see Sim City skyscrapers popping up left and right, but to nag about height for height's sake is only wishing. The only way we'll see a high-rise any time soon is if the big developers in town join into a partnership. Maybe something between the Bojis and Ferguson and Granger?

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The plan has been to keep the structure of both buildings. Tear off the roofs, and build up. The newer portion would have a few runs of bricks knocked out, to lower the ceiling to match the older building. A new facade was going to be put across the whole thing to make it one building, instead of two. The foundation and structure of the older building is definetly worth saving. These savings on the foundation is making it possible to save a considerable amount of money. I did explore the complete demo option, but that building is SOLID. It has 14 inch thick walls, steel interior structure with poured floors, the architects were quite surprised at just how overengineered the building was. In a conversation with a representative of Abrams, there were saying that they improved it to support some of their very heavy equipment.

Not much will be remaining of the current building as far as features, but then again, there are almost none to preserve. I am trying to put a few Art Deco features on the building.

There are still a few things that are not set in stone yet, as this project is proceeding very quickly on several different fronts. I am trying to get it going, to coordinate with the sewer separation, so hopefully, BWL will change out a few things and save some money, since the street will be torn up anyway.

I am hoping to save some money also with some panelized walls, and shift the savings into extra sound proofing and extra premium windows and doors. The front I intend to use some more expensive facade features, but will probably go less expensive on the back and sides, since they won't be as visible.

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Are you going to build off the existing building or put supports throught it? That building really does seem odd that it was built so strong, from the outside it appears to just have cinderblock walls supporting the roof. Also when you get some rendering's post them, I'm anxious to see what it will look like. And (if you don't mind, of course) what kind of budget are you looking at for this?

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Mr. Fisher, do you know when Larch is suppossed to be torn up? I've heard that Michigan Avenue from the rail-road tracks through downtown is going to get a resurfaced and streetscapped this year (with a grassy/treelined center median in some spots, a bit improvement in my book).

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Sorry guys, being a finance guy, I have a real good idea what I can leverage, and what I can't. Those projects are beautiful, but I can't pull them off in this spot, maybe in another project down the road.

Also one thing that factors pretty heavy in those other projects is rent and incomes of the areas they are being built. The Skyloft projects in Royal Oak sold out fast and for top dollar, but the average sales price is significantly higher than here. A 2x4 or a kitchen faucet costs about the same across the state, so its not that building costs are so terribly different to justify the prices, but if the residents of the area can't afford to live there, your doomed, you build the coolest thing you can for the price bracket that people will buy or rent. Granted this can lead to a chicken and eqq argument, but I do think that Lansing is definetly sowing the seeds for creating a district that may attract more affluent people. A few more things need to happen before it really takes off though.

My opinion is that it would be nice if the Eydes would let go of the Knapp's building for a price that would allow for an attractive redevelopment. Papa Joe's on the first floor with residences in the middle floors, and a restuarant on the top floor with summertime dining on the terrace. A price tag of 6 million, plus what would be a staggering redevelopment cost, doesn't make it seem like anything that would happen any time soon.

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Believe it or not, I feel pretty confident that I can pull it off for around 3-3.5 million. I'm also able to 'recycle/reuse' the current sprinkler system in the building. I feel that I got a little lucky with what I am able to reuse, and still having so much new construction on the building, I kinda got the best of both worlds.

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Those are some pretty impresive numbers, I guess I understand what you mean by extra cost, I would estimate adding five floors would cost around $6-7 million, exactly how many floors are you planning on adding now?

The median idea on Michigan may have been shot down, a lot of people fought against the idea and I'm not sure if the city council listened or not. The city does have a pretty bad track record with maintaining such things, it would probably be pretty ugly after just a couple years.

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Your idea for the Knapps Center downtown is a great one! I had never thought of actually utilizing the roof-top for a restaurant.

You will find no support for the Eyde's here. They are much better suited at working in suburban environments, and can't seem to get anything done in the central city. They are asking far too high prices for their land and property, and it shows in how they've set vacant for years despite some plans (most less than spectacular).

It seems the only way the Knapps is going to be renovated is if a full team of developers go in on it, which I just don't see happening. It stinks seeing it sitting empty, easily one of the most unique buildings on the Square while the other former department store just down the block is now renovated and up and running nearly.

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I also love that idea for the Knapps, I think a respectable price for Knapps would be $3-4m tops, the city may have to use emminent domain, or maybe the Boji's can muster something, I know they have the funds to do something. I would guess the cost of redevelopment would be ~$10m.

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Our city council doesn't have the balls to take on any big developer. The only people or group they've ever taken on is poor land owners to grab land. The legal costs would be too great.

Know, the second option of the Boji's fronting the money could work if they are interested. They seem to be pretty good at both preserving and updating older buildings (i.e Boji Tower).

What they Eyde's have said from day one is that they want to completely strip the building of what makes it special: it's glazed ceramic tile facade. That's unaccetapble. And not just that, they want to keep it an office building. That would be foolish, and against the idea of Washington Square as a residential and retail corridor. It's one of the last large building blocks on the Square.

I know I'm getting of subject, but I think a revitalized Knapps would do a lot to show that Washington Square can support a residential neighborhood thus drawing in more quality and up-scale retail. The Arbaugh is just not enough, though it was a GREAT first step.

I'd also LOVE to see some thin mid and high-rises go up along the few vacant blocks of the Square such as the huge gravel lot RIGHT on Washington in between the Knapps and Cooley Law Library.

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That rendering of the Ashley-Mew building is probably quite similiar to what the building will look like.

With respect to the developers of Lansing, I have respect for most all of them, with the exception of the Eyde's. Honestly I don't believe they are cut out for almost any development. I have been through so many of their crappy properties with clients, and they are SO bad, I consider them unacceptable.

I think it is a travesty that they have the Knapp's building.

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That, and that HUGE tract of land on the very western edge of downtown that they refuse to put anything acceptable one. Their current proposal is a suburbanish office building in which they were FORCED by the city to consider residential in. It is unacceptable. They've also purchased that beautiful Walter French Academy on South Cedar which continues to sit vacant save for a temporary tenant at the moment. The sooner someone else gets these properties the better. I think it is very telling that all of their largest properties, and largest tracts of land in urban Lansing sit empty, don't you think?

Anyway, some more mid and high-rises were approved in Michigan just to give some more examples of urban mid-to-high-rise infill:

Kingsley Lane Lofts - now 9 stories and 4 stories respectively, 44 units, off-site parking, construction to start 2006

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(old rendering)

Webiste: http://www.kingsleylane.com/

Main North Place, Royal Oak - Lofts, Terraces, and Residences of varying heights, hundreds of units, under construction.

terraces_rendering.jpg

lofts_rendering.jpg

Website: http://www.mainnorth.com/

These are all great examples of what I'd like to see in Lansing in the coming years.

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Actually, that's two separate building (one under construction), and the rendering has yet to be released for the third one. There is also a 17-story tower on hold in downtown Royal Oak. You've been there haven't you? It feels like a small Ann Arbor (Kalamazoo maybe) without the university presence.

The one currently under construction. This was sometime in the fall of last year, I believe, so it should almost be done by now:

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Not really. Royal Oak is more of a independent city that was surrounded by sprawl. It lies on the dense Woodward Corridor that stretches from downtown Detroit to downtown Pontiac, and is full of small city with nice downtowns. Royal Oak is now a bit larger than the City of East Lansing, but falling in population.

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You really should take a day and stroll around Royal Oak and Birmingham, both downtowns are beautiful!!! Excellent business mixes, both independent shops and the proper mix of corporate stores.

So, just out of curiosity, what would you guys think would be the right business to try to attract to the commercial space of the Abrams? Its going to be about 4200 square feet of usable space, with tons of space in the basement that could be utilized.

I have some ideas, but I would like to see what you guys think.

Also, you guys realize that most of those renderings, are basically all the same? With the exception of that white building.

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