Studio Park - $140 Million Celebration Cinema/mixed use project

[GRDadof3]

49 minutes ago, WMrapids said:

Will this have IMAX? I can’t remember if this was mentioned at all.

That one theater looks awfully large but it doesn't look like IMAX. I think the rise is steeper in IMAX and the screen is curved usually. 

[GR8scott]

Would have liked to see more of a retro cinema look than the modern boring glass

[GRDadof3]

20 hours ago, GR8scott said:

Would have liked to see more of a retro cinema look than the modern boring glass

I was going to say that the arched windows are a bit dated looking but I'm trying not to complain about every little thing going on in this town.

[x99]

19 hours ago, GRDadof3 said:

I was going to say that the arched windows are a bit dated looking but I'm trying not to complain about every little thing going on in this town.

I'm just counting my blessings on an attractive design element that is more than one story tall and which is fairly pedestrian friendly.   Couldn't agree more with gr8scott about the theater entrance.  It's rather understated, which isn't how I would have thought a downtown theater would do things.  Hopefully it's a bit more bold in person.  Someone needs to call Cinemark and ask them how to do "the movies" right.  

[joeDowntown]

6 hours ago, x99 said:

I'm just counting my blessings on an attractive design element that is more than one story tall and which is fairly pedestrian friendly.   Couldn't agree more with gr8scott about the theater entrance.  It's rather understated, which isn't how I would have thought a downtown theater would do things.  Hopefully it's a bit more bold in person.  Someone needs to call Cinemark and ask them how to do "the movies" right.  

I originally thought the same thing, but my worry with going for a full retro cinema look is that it’d come off half-baked if they didn’t execute it perfectly. And it seems like that rarely happens.

so maybe it’s good that they didn’t attempt it and have something that ends up looking like a cheap rendition of a classic theatre. I actually think it’ll all look good when it’s done because there is so much variety in the different buildings (or at least that’s my hope). 

Joe

[GRDadof3]

I assume this portion is the bottom corner section of the hotel that we were all wondering what it would look like. Presumably the new "listening room" music venue:

Previous iterations:

 

[RustTown]

Quick questions:

1.  What's exactly under construction at the moment?  The hotel, theater and parking garage, right?  Or is it also Building's B & C, too?

2. Are there any documents in the city package that show how many feet the Canopy tops out at?

I'm having a hard time orienting myself in the construction photos and the site plans.

[MJLO]

22 minutes ago, Lmichigan said:

Quick questions:

1.  What's exactly under construction at the moment?  The hotel, theater and parking garage, right?  Or is it also Building's B & C, too?

2. Are there any documents in the city package that show how many feet the Canopy tops out at?

I'm having a hard time orienting myself in the construction photos and the site plans.

I believe all buildings are under construction.  Based on the ariel photos buildings B, and C, the Hotel, the parking facility, and the office building  are under construction for sure.  The only one that seems to have open space on it is the theatre itself.  Even then it's difficult to say that it's not under construction because it's going to have a different construction footprint and appearance compared to the other buildings. 

[GRDadof3]

This is my rough interpretation of what's going on right now. The office building in the upper right corner has NOT started yet.  I don't recall the height of the hotel but I believe it's buried in this thread somewhere. It's almost identical in height to the Embassy Suites in Monroe North (according to Pioneer). 

 

 

[GRDadof3]

Here ya go @Lmichigan

 

And similar view of the Embassy Suites (which is about 200 feet longer)

[RustTown]

Thanks for all this.  What was throwing me off was that I didn't realize the city was bringing Ionia through.  Love this truly mixed-use project, BTW.

[GRDadof3]

2 hours ago, Lmichigan said:

Thanks for all this.  What was throwing me off was that I didn't realize the city was bringing Ionia through.  Love this truly mixed-use project, BTW.

Actually they're extending Ottawa (not Ionia). They vacated the street which was essentially an extension of the 131 offramp, which is where the theater now sits and the plaza. Ottawa was extended South of Oakes and now meets up with Cherry. Which I believe was applauded by the Rapid which now has a more direct route out of the central station to Fulton (?)

 

I found this old ditty. Don't know how many people remember when just a movie theater was proposed for this site?

https://www.mlive.com/business/west-michigan/index.ssf/2012/04/celebration_cinema_looks_at_do.html

[joeDowntown]

This sucks:

https://mibiz.com/sections/real-estate-development/item/26260-developer-cancels-downtown-gr-office-project-amid-low-demand

Maybe the reason we complain about all of the mediocre architecture downtown is that there is no appetite for the $$ it takes to build something really nice?

Joe

[mpchicago]

23 minutes ago, joeDowntown said:

This sucks:

https://mibiz.com/sections/real-estate-development/item/26260-developer-cancels-downtown-gr-office-project-amid-low-demand

Maybe the reason we complain about all of the mediocre architecture downtown is that there is no appetite for the $$ it takes to build something really nice?

Joeann

1

This does suck, but I can't say I'm surprised.    The failure of 12 Weston project and the very conservative  Warner Building are big clues that there is not a lot of interest in expensive, new office space downtown.   Still, I was hoping I would be surprised with some big announcement of an out of state company setting up shop or a large suburban tenant finally making it's way downtown.    You can blame parking, as one issue (though I think this had built in parking), but I think ultimately Grand Rapids is still a manufacturing town, and there is not a lot of need "white collar" office space.   If you look at the industrial real estate sector, it's still red hot with something like 1% vacancy rate in most areas of town.  I don't think this will be a hurt the overall Studio Park project, but it will look a little awkward with a hole there.  Let's hope something happens there sooner rather than later. 

[RustTown]

1 hour ago, joeDowntown said:

This sucks:

https://mibiz.com/sections/real-estate-development/item/26260-developer-cancels-downtown-gr-office-project-amid-low-demand

Maybe the reason we complain about all of the mediocre architecture downtown is that there is no appetite for the $$ it takes to build something really nice?

Joe

Damn.

Quote

 

Franklin Partners Principal Don Shoemaker said the firm approached a wide variety of large suburban employers across the region, expecting that they’d jump at the opportunity to lease space in a modern, Class-A office building. 

“We didn’t really gain any traction,” Shoemaker said, adding that he thought West Michigan firms would follow the trend of multiple large suburban Chicago companies in seeking out urban office space. “It led to very few second conversations. I’m a little surprised.”

 

I can not countenance the parking reason, though.  This thing was literally going to be built around a parking garage.  If there wasn't enough space in it for all the uses planned, it could have easily been extended another floor or two to accomodate a large office tenant. 

[GRDadof3]

1 hour ago, mpchicago said:

This does suck, but I can't say I'm surprised.    The failure of 12 Weston project and the very conservative  Warner Building are big clues that there is not a lot of interest in expensive, new office space downtown.   Still, I was hoping I would be surprised with some big announcement of an out of state company setting up shop or a large suburban tenant finally making it's way downtown.    You can blame parking, as one issue (though I think this had built in parking), but I think ultimately Grand Rapids is still a manufacturing town, and there is not a lot of need "white collar" office space.   If you look at the industrial real estate sector, it's still red hot with something like 1% vacancy rate in most areas of town.  I don't think this will be a hurt the overall Studio Park project, but it will look a little awkward with a hole there.  Let's hope something happens there sooner rather than later. 

That is a bummer. It was a nice looking building. 

[ProtoSapien]

2 hours ago, joeDowntown said:

This sucks:

https://mibiz.com/sections/real-estate-development/item/26260-developer-cancels-downtown-gr-office-project-amid-low-demand

Maybe the reason we complain about all of the mediocre architecture downtown is that there is no appetite for the $$ it takes to build something really nice?

Joe

It's kind of bummer to hear things like this while Dan Gilbert's project in Detroit just keeps getting bigger - https://www.detroitnews.com/story/news/local/detroit-city/2018/10/28/new-renderings-released-bedrock-old-hudsons-site/1799125002/

[GRDadof3]

22 minutes ago, ProtoSapien said:

It's kind of bummer to hear things like this while Dan Gilbert's project in Detroit just keeps getting bigger - https://www.detroitnews.com/story/news/local/detroit-city/2018/10/28/new-renderings-released-bedrock-old-hudsons-site/1799125002/

Downtown Detroit has a lot of momentum and excitement going on right now, with Dan Gilbert's projects, the new arena, and Ford moving into Central Station (not to mention Midtown being totally rebuilt from scratch almost). 

 

[wingbert]

25 minutes ago, Lmichigan said:

I can not countenance the parking reason, though.  This thing was literally going to be built around a parking garage.  If there wasn't enough space in it for all the uses planned, it could have easily been extended another floor or two to accomodate a large office tenant. 

I thought the parking reference was more a general comment about why larger suburban HQs are hesitant to move downtown.  In that context, it’s a more legitimate statement.

[x99]

1 hour ago, mpchicago said:

This does suck, but I can't say I'm surprised.    The failure of 12 Weston project and the very conservative  Warner Building are big clues that there is not a lot of interest in expensive, new office space downtown.   Still, I was hoping I would be surprised with some big announcement of an out of state company setting up shop or a large suburban tenant finally making it's way downtown.    

John Wheeler is smart guy who builds to a price where he's going to make a profit.  Much of what they do seems heavily client client-driven in the office space, with next to no office space on spec. So, how much of the boring downtown office chintz is actually Orion's fault vs the primary tenant's fault?  No idea.  But this is not a guy who wants to risk going bust on a grand vision.  And he's got a great insight here: 

“That’s the question [whether a major suburb office user would come downtown] I’ve been asking myself since I got into the business,” Wheeler said, noting that the city’s income tax and lack of free, available parking continue to serve as a hindrance for poaching large employers from the suburbs. 

I think that hits the nail on the head right there.  The income tax is incredibly stupid for a city this size when no one surrounding us has one.  I haven't really gone into depth on this in years here (probably since our last RenZone discussion).  But, in light of this, the discussion warrants revisiting.  High(er)-end white collar office users have the same incentive not to come (or to leave) that high income residents do:  $200,000 in income for a couple results in $150,000 out the window (assuming static salaries) over 20 years with an 8% discount (interest) rate on the foregone money.   Over the course of a 30 year career, it's a $340,000 penalty to live and work in the city.  Then if you live here you (probably) have to pay for schools on top.  Screw that.  Even if you shrink it down to $100k, well, it's still a $170,000 hit to live and work.  So, move the office or the house to GR, and your retire account magically shrinks by $85,000 (unless you're making it up in gas or time).  And that's for someone who "only" makes $100k.  Convincing a high end office user to make a deal with  their employees like this is probably next to impossible.  As long as the CFO can do math.   

[RustTown]

14 minutes ago, wingbert said:

I thought the parking reference was more a general comment about why larger suburban HQs are hesitant to move downtown.  In that context, it’s a more legitimate statement.

I mean, if it is, it isn't trelevant  to this particular project, which is what we're talking about.

[demhem]

22 minutes ago, x99 said:

John Wheeler is smart guy who builds to a price where he's going to make a profit.  Much of what they do seems heavily client client-driven in the office space, with next to no office space on spec. So, how much of the boring downtown office chintz is actually Orion's fault vs the primary tenant's fault?  No idea.  But this is not a guy who wants to risk going bust on a grand vision.  And he's got a great insight here: 

“That’s the question [whether a major suburb office user would come downtown] I’ve been asking myself since I got into the business,” Wheeler said, noting that the city’s income tax and lack of free, available parking continue to serve as a hindrance for poaching large employers from the suburbs. 

I think that hits the nail on the head right there.  The income tax is incredibly stupid for a city this size when no one surrounding us has one.  I haven't really gone into depth on this in years here (probably since our last RenZone discussion).  But, in light of this, the discussion warrants revisiting.  High(er)-end white collar office users have the same incentive not to come (or to leave) that high income residents do:  $200,000 in income for a couple results in $150,000 out the window (assuming static salaries) over 20 years with an 8% discount (interest) rate on the foregone money.   Over the course of a 30 year career, it's a $340,000 penalty to live and work in the city.  Then if you live here you (probably) have to pay for schools on top.  Screw that.  Even if you shrink it down to $100k, well, it's still a $170,000 hit to live and work.  So, move the office or the house to GR, and your retire account magically shrinks by $85,000 (unless you're making it up in gas or time).  And that's for someone who "only" makes $100k.  Convincing a high end office user to make a deal with  their employees like this is probably next to impossible.  As long as the CFO can do math.   

Gas, vehicle maintenance, and time could easily account for a good chunk of that if you are in the $100,000 range. Per the US Dept of Labor, the average vehicle costs nearly $10,000 per year to own and operate. Eliminate a car from a family of four and reduce gas, wear/tear, and time from commuting with other vehicles and the tax benefits are likely marginal. 

[MJLO]

I wonder if FP talked to any out-state companies as well.   There are some pretty massive and progressive Fortune 500 companies scattered throughout the state, located in cities that are downright toxic to attracting the modern talent base.  No offense to Jackson, Battle Creek, Midland, or Benton Harbor. but the companies headquartered in these cities have been desperately finding creative ways to attracted an educated talent pool for a least 20 years.  If a shiny new office building is going get filled downtown it would be from companies like that.  Not one of the big, cash shy private W. Michigan companies that are doubling down their investments in their suburban fortresses.  To me their assumptions about these companies show a bit of an amateur naivety I wouldn't have expected.  Anyone on here could have told them this and saved them $.  It's not a secret.

[joeDowntown]

It feels like a big punch in the gut. If we can't fill a (relatively) small Class A office building, it says a whole lot about what downtown *won't* look like anytime soon. And Franklin Partners seems like the type of company that could get it done. 

After a few failed attempts (this building, the Keeler Building, Site 36, putting the Display Pak building on the market), you wonder if Franklin Partners and other outside companies will give up on this market and go back to where they can get deals done?

Joe

[x99]

3 hours ago, demhem said:

Gas, vehicle maintenance, and time could easily account for a good chunk of that if you are in the $100,000 range. Per the US Dept of Labor, the average vehicle costs nearly $10,000 per year to own and operate. Eliminate a car from a family of four and reduce gas, wear/tear, and time from commuting with other vehicles and the tax benefits are likely marginal. 

Virtually no family of four with a six figure income is going to live without a car.  Just get over that ridiculous fantasy.  Enough, already.  You clearly were never in a downtown parking ramp at 7PM 10 years ago and then in one today.  Even the people who bought stuff right downtown mostly have car(s).  You might save a few bucks on commute gas, best case.  That's how I lie to myself and tell myself I make up the tax difference. 

For a company already in the suburbs, moving your HQ (and executive suite) downtown makes no sense.  I'm just glad Wheeler finally made the point (albeit indirectly) that the way the city chooses to manage and fund itself means it really only markets to people without a lot of disposable income.  You can't support lots of Class A office space and expensive residential with that formula in a market like this.  Are taxes the only factor that are a problem?  No, but they're another nail in the office space coffin, on top of the nailed on, spiked, dead, and buried lid on the retail coffin.   I'm glad someone is finally publicly pointing to more problems other than parking.  This Studio Park project is only the latest in a string of stillborn office and residential projects.  It's high time to starting identifying some causes.   Hint:  None of the causes are "lack of public transit" which none of the projects have relied on.

Edit:  I thought I had run across a study at one point explaining the city income tax problem.  Here it is:  https://www.nber.org/papers/w2197.pdf.   If you don't care to read through pages of complex regression analysis and math, the important takeaway for our purposes here is this:  "Assuming constant total tax revenue... the net effect of shifting away from property taxes toward income taxes is to reduce the size of the property tax base."  The corollary would be that the net effect on development of a higher income tax versus elsewhere is indeed to shift development elsewhere, or stop it from happening at all.

Edited October 29, 2018 by x99