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New apartments planned for historic Century Furniture Factory

GRDadof3

By GRDadof3
in Grand Rapids

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GRDadof3 Ecumenopolis

GRDadof3

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Good news. Anyone know if the developers are optimistic on the chances of this going through? It's a great old building and would be a nice addition to that side of town (plus, it is within stumbling distance to Founders :). Joe

I think now that the urban market is a go, that has triggered this project to move forward (as well as Wealthy Jefferson). I think people are foreseeing another boom of development in that area around Wealthy and Jefferson. Available land, available old buildings, highway access, transit, etc..

I'd give it a pretty good shot.

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Gorath Whistle-Stop

Gorath

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Just a little digging and I now know who the GC is. That the building is to be fully renovated. And there will be a new, um, type of addition. I still don't know what the use is. I guess I'll just have to wait until tomorrow for the details.

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GRDadof3 Ecumenopolis

GRDadof3

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Just a little digging and I now know who the GC is. That the building is to be fully renovated. And there will be a new, um, type of addition. I still don't know what the use is. I guess I'll just have to wait until tomorrow for the details.

I hadn't heard about the addition. The project is (obviously) moving forward. 43 apartments in the first phase, 44 in the second along with 15,000 sf of commercial space on the ground floor. Rockford is the GC. Project is funded in part with LIHTC's and HPTC's, which means there will be income restrictions.

It is good that it's the first real sign of development to go along with the Urban Market, and it's the first large scale (125,000 sf) residential renovation in about 5 or 6 years downtown.

It also has a new name.

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metrogrkid Hamlet

metrogrkid

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I came in from the kitchen to the living room and caught the tail-end of WOOD TV-8 Anchor Susan Shaw talking about "former Baker Furniture Building near new Downtown Urban Market being developed into new downtown housing" . . . . . I AM PISSED THAT I CAUGHT THE TAIL-END OF THAT AND NOW CANNOT FIND IT MENTIONED ANYWHERE - even on the WOOD TV-8 SITE <ARGGGHHH>!!!! If anyone can dig this up, it is the UP-GR community. GET TO DIGGIN! That is a HUGE building and will essentially create a brand new unprecedented neighborhood for the SouthGate area of downtown! WOW!

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jthrasher Whistle-Stop

jthrasher

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again... what's with all the low income housing re-develepments in the cool old buildings? What does this city have against young professionals living in downtown lofts? Why not larger condos? I love seeing re-development like this and I get excited about the projects but it seems time and time again that I'm disappointed with the vision and results. I need to become an architect or something to stop all this madness.

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x99 Burg

x99

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again... what's with all the low income housing re-develepments in the cool old buildings? What does this city have against young professionals living in downtown lofts? Why not larger condos? I love seeing re-development like this and I get excited about the projects but it seems time and time again that I'm disappointed with the vision and results. I need to become an architect or something to stop all this madness.

These are not economically viable projects without massive taxpayer subsidies. Apparently, "the taxpayers" believe it is good to concentrate people with low incomes in downtown areas. Keeps them out of their neighborhoods, I suppose. The strings attached to the subsidies aside, it seems we continue to subsidize the cities instead of forcing them to be self-sustaining and adapt to survive. Is Grand Rapids really being reborn and becoming newly successful if it can't do it without hitting up everyone else for the money to do it? My general unease with projects like this notwithstanding, its nice to see something happening to this building.

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jthrasher Whistle-Stop

jthrasher

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These are not economically viable projects without massive taxpayer subsidies.

How do other cities do it? Tons of other cities have repurposed old buildings into livable apts. or condos that aren't for low income households. I have nothing agains low income households, in fact... right now I would probably qualify, but I don't think that's the way to make downtown successful.

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GRDadof3 Ecumenopolis

GRDadof3

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How do other cities do it? Tons of other cities have repurposed old buildings into livable apts. or condos that aren't for low income households. I have nothing agains low income households, in fact... right now I would probably qualify, but I don't think that's the way to make downtown successful.

Other cities have a mix of market rate and low income housing. Grand Rapids does too. I can think of at least a dozen projects downtown (Hopson Flats, 38 Commerce, Gallery, Icon, etc.) that are market rate. Yet people complain they are too expensive.

Some of these projects are just not viable financially without financial assistance. Pretty difficult to get any bank to finance a project that needs a massive amount of cleanup, without some help. The low income housing tax credits (MSHDA) make it possible to put together a package that will work. And they're filling those places fast, probably with service workers that work downtown. If it's working, why wouldn't a developer keep going back to it?

Take the building across the street from the new DOMA (snicker). Last I saw in an engineering report that came with the listing, it needs about $700,000 in hydraulic jacking on the Northwest corner before you can even begin working on renovating it. Even though the building is priced very decently, that's pretty much cash out of pocket for a developer. It will probably require some kind of tax incentive package to help pay for that kind of infrastructure work.

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gvsusean Burg

gvsusean

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Other cities have a mix of market rate and low income housing. Grand Rapids does too. I can think of at least a dozen projects downtown (Hopson Flats, 38 Commerce, Gallery, Icon, etc.) that are market rate. Yet people complain they are too expensive.

Some of these projects are just not viable financially without financial assistance. Pretty difficult to get any bank to finance a project that needs a massive amount of cleanup, without some help. The low income housing tax credits (MSHDA) make it possible to put together a package that will work. And they're filling those places fast, probably with service workers that work downtown. If it's working, why wouldn't a developer keep going back to it?

Take the building across the street from the new DOMA (snicker). Last I saw in an engineering report that came with the listing, it needs about $700,000 in hydraulic jacking on the Northwest corner before you can even begin working on renovating it. Even though the building is priced very decently, that's pretty much cash out of pocket for a developer. It will probably require some kind of tax incentive package to help pay for that kind of infrastructure work.

I think that the tax/building credits aren't just to make it so the buildings are profitable. It would be easy to just knock these buildings down and build new but we choose to rehab the buildings to preserve our history. It can be expensive (the building jacking). Id rather give my money to contractors that build upon our past than those whom build some suburban, ugly in 5 years, run of the mill building...

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jas49503 Hamlet

jas49503

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again... what's with all the low income housing re-develepments in the cool old buildings? What does this city have against young professionals living in downtown lofts? Why not larger condos? I love seeing re-development like this and I get excited about the projects but it seems time and time again that I'm disappointed with the vision and results. I need to become an architect or something to stop all this madness.

From what I understand, the developer can use the tax subsidies as a "down Payment" this makes financing much easier and projects can be built with a fraction of the out of pocket expenses.

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Jippy Whistle-Stop

Jippy

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Developers can usually sell tax credits to other companies that have corporate tax liability, which can be converted into equity into the project. For example, if one has $1 million in tax credits then a company may buy it for 85% of its value ($850,000). The company then reduced its tax liability $150,000 and the developer now has $850,000 cash for its project. The state then achieves its public purpose goals via the tax code (reduction of corporate tax revenue of $1m). This is the distinction between grants and tax credits -- grants are direct government contribution via revenue collected, and tax credits are a reduction in what a corporation has to pay in taxes.

Personally, I think grants are a more efficient method of achieving the public purpose goals. However, corporations like getting in on the action via tax credits. Again, democratically-elected officials have identified goals deemed desirable for the broader public purpose, and utilizes tools within its domain to achieve those goals -- economic development, historic preservation, redevelopment of contaminated or blighted properties, quality housing for low to moderate income individuals, etc. The influx of low-income developments is a direct result of eliminating or drastically scaling-back other tax credits developers formerly had access to. Broader considerations should also be given to the government's return on investment via other forms of tax collection. If a project requires a financing bridge via a tax credit or grant, one can also do analysis of the increment increase the project produces via additional property, sales and income tax returns. Thus, the "subsidy" is not necessarily as great as it initially appears.

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Quercus Whistle-Stop

Quercus

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I too was thinking this project would be market-rate apartments, but I'm fine with it being a low-income project. Heartside / South division is seeing a healthy mix of developments, so I'm not concerned about the area becoming saturated with a particular land use. There are plenty of empty lots to be developed at market rate, and if saving some of GR's great brick warehouses requires tax credits, I'm all for it.

Part of the problem, though, is the definition of "low income housing." I think for most people that brings to mind something negative, when in fact affordable housing is a complex subject involving local median incomes, nutrition, mental health, preservation, and the differing needs of rural and urban populations.

The Michigan Association of Planning defines (pdf - page 9) affordable housing as " ...a housing cost that does not exceed 30% of a household’s gross income. Housing costs considered in this guideline generally include taxes and insurance for owners, and sometimes include utility costs. When the monthly carrying costs of a home exceed 30 to 35 percent of household income, then the housing is considered unaffordable for that household."

This 2010 Housing and Urban Development spreadsheet (pdf) I found outlines what that means from region to region. In Grand Rapids, for instance, individuals with an income under $35,000 qualify for low-income housing. A lot of folks probably qualify for affordable housing and they just don't know it. And low-income projects can be targeted at various levels of affordability. I'm guessing this project will be aimed at several tiers of the affordable housing program.

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