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What type of development will be Grand Rapid's next tallest?


snoogit

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81 members have voted

  1. 1. What shall it be?

    • Office
      12
    • Retail
      0
    • Commercial Mixed use (Office & Retail)
      21
    • Residential
      1
    • Residential Mixed Use (Condo & Apartment)
      8
    • General Mixed Use (Residential & Commercial)
      34
    • Hotel
      4
    • Government
      0
    • Other (Please List)
      1


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I wonder what the vacancy rates look like in other state markets. Do you think the high vacancy rates, pretty much put a stopper on new office developement? For class B and class C office space, how does that work, can an owner of a building upgrade facilities to the class A level, making a market more appealing? Or is it just not cost effective.

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Very often class B and C buildings are converted to class A office, sometimes old industrial buildings are upgraded to class A office. FROm what I've heard development is class specific, so high class B vacancy doesen't equate to a lack of class A development. Typically I think new development becomes feasable when vacancy rates dip below 10%, the further down they go the better the prospects for new development.

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I still see a lot of for lease signs around downtown. And with the higher vacancy rates in the suburbs it seems like there's quite a lot of space to fill before we see any new development. Though if a large tenant comes to town that might require new development.

-nb

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But in terms of something like a large corporate presence. If a corporation wanted an HQ downtown, don't they more often than not build their own buildings? ie, Mercantile Bank ect.

Yeah, many times it seems that even when there is enough space open for a company to move into, if their anyhting big they want to build their own, or restore a high-profile older building. Maybe something the size of Mercantile Bank could of moved into something existing but I think they are sort of borderline, I guess being a bank who seems stuck on that particular design they decided to go ahead and build their own anyways.

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I still see a lot of for lease signs around downtown. And with the higher vacancy rates in the suburbs it seems like there's quite a lot of space to fill before we see any new development. Though if a large tenant comes to town that might require new development.

-nb

You can't necessarily judge office space demand by signage. There's quite a bit of science to it. There may be a few office users looking for space downtown right now, but maybe very few of the current available space fits their needs. Or sometimes lazy brokers forget to take their signs down, just to get the exposure.

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You can't necessarily judge office space demand by signage. There's quite a bit of science to it. There may be a few office users looking for space downtown right now, but maybe very few of the current available space fits their needs. Or sometimes lazy brokers forget to take their signs down, just to get the exposure.

Yeah, some of those commercial real estate signs are poractically permanant. Also, even if there is space in a building for lease, many times it may only be a few thousand sq ft, even in a large building. I wish that there was a more consistant resource for office vacancy rates in mid-size cities, CBRE only keeps up to date on the large metros, updating mid-size ones maybe once a year. Nobody else I've found even has any data on vacancy rates.

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While I personally think the next tallest will be an Office/Retail place, with the retail anchor probably something like a Whole Foods or other hip urban store thsts bandied about lately. As for an office anchor? Look at one of the medium-sized banks to enter downtown. Macatawa, Independent, or Mercantile to anchor the building. I'm sure a law firm, or even an architectural firm could look into a big office in the near future downtown to help anchor the building

Or if we are lucky 5/3rd is the source of the new building (Tearing down the concrete monster on Lyon, and building on the ashes of old.)

Hmmm... There seems to be a trend also... Of Hotel, Condo, Office it tends to repeat itself over and over again :P

1980: Ransom Towers

1982: National City Building

1983: Amway Grand Plaza

1985: Campau Square Building

1988: Eberhard Center

1991: Plaza Towers

1993: Bridgewater Place

2000: Van Andel Institute

2001: Kent County Courthouse

2003: Cook-Devos Center for Health Services

2007: JW Marriott Hotel

2008: Riverhouse Condos

(etc. etc.)

Grand Rapids seems to get growth spurts every 20 years or so that last nearly the entire decade.

The 80s were a big building boom in Grand Rapids, the 60s were a big building boom in Grand Rapids, and so far its looking like this decade is going to keep the pace, if not set GR's newest building record (I could see possibly one, maybe up to three new buildings in the future.)

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  • 1 year later...

I had an urban history class at GVSU a while back and the professor explained why GR would forever be a regional city. If you think of cities with "spheres of influence" (surrounding countryside where a city draws upon natural resources and human capital), there are two very large spheres eminating from Detroit and Chicago (both within a 3-4 hour drive from GR). They both touch roughly where GR is and thus, resources tend to go instead to those cities than to GR. Examples could include college students, companies, and finished products. In comparison, GR's "sphere" only includes west Michigan (hence the strong presence of regional companies). Why would a major world-wide company want to set up shop (a 400+ foot tower) in Grand Rapids when they could set up shop in Detroit or Chicago (or worse yet, the suburbs of those cities) and have better amenities? Thus, the only way such towers would probably be built, short of wiping those two cities off the maps, is if more mixed use is incorporated into their designs. A mixed use development would have the best potential to succeed economically in a regional city like GR. We all know that the city will never build a new governmental building because of our economy now and the fact that they'd have to proposition the public again to pay for it. So that idea is dead.

GRDad is probably right: mid sized high rises are probably the best bet and would infill most of GR.

I hate to be the pessimist because I so badly want to see a signature high rise building gracing GR's skyline, but my professor seemed to have a point.

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I had an urban history class at GVSU a while back and the professor explained why GR would forever be a regional city. If you think of cities with "spheres of influence" (surrounding countryside where a city draws upon natural resources and human capital), there are two very large spheres eminating from Detroit and Chicago (both within a 3-4 hour drive from GR). They both touch roughly where GR is and thus, resources tend to go instead to those cities than to GR. Examples could include college students, companies, and finished products. In comparison, GR's "sphere" only includes west Michigan (hence the strong presence of regional companies). Why would a major world-wide company want to set up shop (a 400+ foot tower) in Grand Rapids when they could set up shop in Detroit or Chicago (or worse yet, the suburbs of those cities) and have better amenities? Thus, the only way such towers would probably be built, short of wiping those two cities off the maps, is if more mixed use is incorporated into their designs. A mixed use development would have the best potential to succeed economically in a regional city like GR. We all know that the city will never build a new governmental building because of our economy now and the fact that they'd have to proposition the public again to pay for it. So that idea is dead.

GRDad is probably right: mid sized high rises are probably the best bet and would infill most of GR.

I hate to be the pessimist because I so badly want to see a signature high rise building gracing GR's skyline, but my professor seemed to have a point.

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I had an urban history class at GVSU a while back and the professor explained why GR would forever be a regional city. If you think of cities with "spheres of influence" (surrounding countryside where a city draws upon natural resources and human capital), there are two very large spheres eminating from Detroit and Chicago (both within a 3-4 hour drive from GR). They both touch roughly where GR is and thus, resources tend to go instead to those cities than to GR. Examples could include college students, companies, and finished products. In comparison, GR's "sphere" only includes west Michigan (hence the strong presence of regional companies). Why would a major world-wide company want to set up shop (a 400+ foot tower) in Grand Rapids when they could set up shop in Detroit or Chicago (or worse yet, the suburbs of those cities) and have better amenities? Thus, the only way such towers would probably be built, short of wiping those two cities off the maps, is if more mixed use is incorporated into their designs. A mixed use development would have the best potential to succeed economically in a regional city like GR. We all know that the city will never build a new governmental building because of our economy now and the fact that they'd have to proposition the public again to pay for it. So that idea is dead.

GRDad is probably right: mid sized high rises are probably the best bet and would infill most of GR.

I hate to be the pessimist because I so badly want to see a signature high rise building gracing GR's skyline, but my professor seemed to have a point.

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there may be a lot of compelling reasons for companies to choose an area like Grand Rapids over a much larger city like Detroit or Chicago, one of those might be lower costs or higher standards of living. But the fact that 3/4's of Michigan identify with Detroit is a challenge to overcome, especially when the metro Detroit economy is not doing well. Although it may shift population to West Michigan for people who want to stay in Michigan.
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I don't know if I'm buying all of this. I get the point that we're sandwiched between two cities with a much larger sphere of influence, but I think there is more to take into consideration.

1) Look at Delaware. All the credit card offers you get are generally from Wilmington, DE. Why? The state has adopted corporate laws that don't tax companies on business they do outside of the state. Incentives like this could be used to draw certain industries to the area...whatever those incentives may be.

2) Consider what a company looks at when choosing a HQ destination. Tax rates, cost of living, commuting time/cost, agglomeration economies created when many players in the same industry are near each other, labor costs, overall appeal of the area...these all come to mind, but there are many others I'm sure. If we can ever get the State on track with a long term solution to our budget crisis, most of the factors of doing business in GR are very appealing.

3) Knowledge base. Why did Ann Arbor get 1,000 Google jobs? I'm willing to bet that U of M played a large role. If GR can continue the path it's on--GVSU growing in size and prestigiousness, Kendall adding programs and continuing to have a great reputation, largest community college in the nation, increasing presence of WMU, CMU, and MSU, and the VAI--we will continue to become more attractive to companies looking for an educated employee base.

4) Availability of Labor/qualities of the GR worker. A buddy of mine recently returned from working on a Toyota plant in Mississippi. He has made comments on how the general contractors down there love bringing in people from the north because they are generally harder workers. Our blue-collar culture is hard working, and many businesses know this of the Midwest.

...just some food for thought.

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I picked Other. Forget office space and residential, focus on tourism and the visitor experience of those who arrive for a convention at Devos Place. Make this iconic skyline addition a part of the new urban mall at the corner of Fulton/Division and put a nice restaurant up top along with an observation deck (see Lake Michigan!), etc. Sweet!

1889386033_456435b0a4_o.jpg

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I don't think anyone is saying that Grand Rapids will ever be a Detroit or Chicago. Also, if you look at the general high-rise building industry in the U.S., the great majority of the high-rises going up are not corporate HQ. Even in big corporate relocation cities like Nashville, the corporations that are setting up shop in these areas 9 times out of 10 are moving into or building suburban office spaces, not 400 footers in the downtowns. 95% of high-rises going up right now in the U.S. are residential or hotel/hospitality. The high-rise world has changed since the 80's and 90's.

And I have to disagree about the school systems. Even though GRPS is struggling, I'd put our suburban districts up against any in the country. There are people moving here from the East Coast because of the quality of the school systems here, trust me.

Rhino, that's so interesting that you bring up Wilmington, DE. My brother designed a massive data center for one of the big credit card companies in an office park there where 75% of the tenants were banks and credit card companies. But he said there were very few employees there. Just massive numbers of air-conditioned server warehouses.

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TC has a high percentage of people that retire from the Detroit area in it. Plus the vacationing numbers that Detroit can put into the TC market versus Grand Rapids, makes it easier for TC to identify more with Detroit.

As for the spheres of influence, there is no doubt that GR will be hard pressed to ever compete with Chicago. I'm not so sure, however, about Detroit. Detroit is, and probably will forever be, dependant on the auto industry for it's fortunes. If GR can carve out it's own niche other than an industrial feeder city to Detroit, however, I don't see any reason why Michigan cannot mimic Ohio and support multiple large cities.

Cleveland, Cincinnati, Dayton, Columbus, and Toledo all have major influences in Ohio. None of those cities rival Chicago, but combined they are an impressive collection of metro areas for just one state. Each city has a unique niche that it economically fills as well, and so while one city my be suffering, it's very hard for the entire state of Ohio to suffering at once because there is a good economic balance created by these cities. Given where Grand Rapids is situated in the state, I can see GR becoming such a city given good planning. Especially if it can develope an economic engine that is independant of the auto industry. If GR can stay healthy while the auto industry goes through it's cycle of boom times and lean times on the east side of the state, GR will have chance at growing and gaining more influence in the state. Which IMHO would be a good thing, as Michigan depends way too much on the health of the auto industry to drive it's economy. A growing Grand Rapids area with a strong economic engine separate from Detroit would be much healthier for the state as a whole.

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Rhino, that's so interesting that you bring up Wilmington, DE. My brother designed a massive data center for one of the big credit card companies in an office park there where 75% of the tenants were banks and credit card companies. But he said there were very few employees there. Just massive numbers of air-conditioned server warehouses.
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Maybe I need to do some homework. But I never really have read Grand Rapids as a feeder city to Detroit other than Autodie in North Monroe and the huge GM stamping plant in Wyoming. I've always though that GR is pretty much self contained economically and culturally. Detroit was one of the first areas to go south when Michigan took its economic nose drive. If GR were tied to Detroit more so than it is now I think this city would be in far worse shape than it is now. Maybe some one can provide some enlightenment in a new topic.
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