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Metropolitan Park Apartments - Construction


daniel nudnik

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Exactly - there is no middle ground in the dt area. That's why i was sad to see that the Hillmount was switching over because Hillmount and Oakwood were the only mid priced apartment complexes in the dt area.

I did call The Globe today, and they also have "Market Rate" price plans which are really reasonable. That may be an option for Metro Park as well :dontknow: . They give a discount to lower incomes, but will still allow you to rent if you're above the income level. It isn't fully gov't subsidized housing.

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It isn't fully gov't subsidized housing.

To be technical, the globe isn't subsidized at all because renters are required to pay their full rent, there's no voucher or anything like that, their rent is just discounted. The benefit comes to the building owner in the form of tax breaks. In the case of Metropolitan Park, "If approved by the MSHDA, all 24 units would be assisted with Low Income Housing Credits."

Dunno if they were approved.

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Maybe I'm dense, but how is that not subsidized?

Uhm... I don't know. Maybe I'm mistaken, but I thought that it wasn't considered subsidized if the tenant was paying full rent as in, they're not turning in a voucher for $300 bucks and $300 cash every month. I'm sure i'm wrong.

Edit: This is what I was told by the Globe people BTW.

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Here are the pictures:

141717507_8d9f5e57a9_b.jpg

141717509_4ea2eed015_b.jpg

141717511_10904394a6_b.jpg

Enjoy!

From what I've heard, this project needs to fill a 50% occupany target before they start to build. The foundation will be poured, but other than that nothing is to be done until they reach their occupancy numbers. Nothing has been bid on this project, because this number hasn't been reached yet.

Can anyone confirm this? I hate to see just footings sit there for any extended period of time. Especially given current housing conditions.

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Apartments usually don't have a problem of filling occupancy.

Actually the rental market in West Michigan is its worst state since the early 1970's according to the Rental Property Owner Association there are over 7,000 empty apartments in greater Grand Rapids Area. It is not only a buyers market in Grand Rapids but also a renters market as well.

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In regard to the project needing to hit a 50% occupany target before starting to build...what I can confirm is that this is standard procedure on a Tax Credit project. When one obtains a tax credit to build a project such as this, the equity ivestor that is buying and syndicating the tax credits has a HUGE amount of say in how the project is run...including when construction can start.

I would assume that to put family housing on that site is a big risk and the tax credit investors and bank providing construction financing would require milestones before putting their money in.

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In regard to the project needing to hit a 50% occupany target before starting to build...what I can confirm is that this is standard procedure on a Tax Credit project. When one obtains a tax credit to build a project such as this, the equity ivestor that is buying and syndicating the tax credits has a HUGE amount of say in how the project is run...including when construction can start.

I would assume that to put family housing on that site is a big risk and the tax credit investors and bank providing construction financing would require milestones before putting their money in.

What I don't understand then, is if they need 50% occupancy in order to go, why did they start? It would be a huge waste of money if they go through all the work of engineering and setting a foundation and then wait for occupancy before continuing. ... or am I misunderstanding?

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I don't think they'll have a problem. It's somewhat unique to what downtown already has going on and is on a great street.

Joe

(http://www.mymetropark.com/) "The residential units will feature spacious two and three bedroom apartment homes with average square footages of approximately 1,050 and 1,700 respectively with open floor plans. Each apartment and town home has two full baths, walk in closets and a fully equipped kitchen with stainless steel look appliances. New combination washer/dryer as well as central air conditioning is included in all apartments and town homes."

With rents at $498 for a two bedroom apartments and $506 for a three bedroom town homes you would think they'd have 50% by now.

What is the "income qualification" that applies?

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(http://www.mymetropark.com/) "The residential units will feature spacious two and three bedroom apartment homes with average square footages of approximately 1,050 and 1,700 respectively with open floor plans. Each apartment and town home has two full baths, walk in closets and a fully equipped kitchen with stainless steel look appliances. New combination washer/dryer as well as central air conditioning is included in all apartments and town homes."

With rents at $498 for a two bedroom apartments and $506 for a three bedroom town homes you would think they'd have 50% by now.

What is the "income qualification" that applies?

Those rents are unbelievably low. How can they possibly do that?

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There have to income restriction to get rents that low. Probably below $30,000 (or a certain percentage of GR's median income)?

The income limit at the globe for one person is around $26k. If you meet that you can get a 2 bedroom that is about 1150 sqft for like $610/month. Thats a pretty huge apartment in a great location for that price.

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The income limit at the globe for one person is around $26k. If you meet that you can get a 2 bedroom that is about 1150 sqft for like $610/month. Thats a pretty huge apartment in a great location for that price.

Right, and if you're above the income "restriction" you can still get that apartment, you just pay a higher "market" rate. Not that i've done any research.. :whistling:

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A 1700 sf condo with an association charge of $.25/sf would pay $425/month just for building maintenance.

Right, but these are apartments, so there isn't a association fee. At least I've never seen them in apts.... It's usually factored in to the rent.

Or are you saying that the first $425 of the rent would be sucked up maintaining the building?

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Yes, that leaves almost nothing for construction costs.

The low rent is offset by Low Income Tax Credits (which apparantly can be about 9% of qualified construction costs each year). A tax credit is much more valuable than a tax deduction.

For the sake of easy math, if you assume the building cost $100 per SF to build, the developer could get up to $9 per SF in tax credits each year (if I'm understanding the program correctly). That's about $15,000 a year on a 1,700 SF townhouse or $1,250 a month aditional "income" for the developer. WOW!

Lighthouse Dave, is this math reasonable?

http://www.michigan.gov/mshda/0,1607,7-141...21934--,00.html

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