Success in the
Support from commercial,
retail and service providers is crucial. Care
must be taken to ensure supply doesn’t
outweigh demand. But many residents, city planners
and developers agree that as of now, the downtown
Grand Rapids housing boom clearly represents
By Mark Johnston
Photography by Michael Buck
It’s been 20
years since Charles and Stella Royce moved out
of their large Colonial house on Grand Rapids’ northeast
side and into the downtown Pearl Street condominium
they still call home. Their address hasn’t
changed. Downtown has.
“On a scale of one to 10?” Charles
Royce mused. “Go to 11.”
How fitting, to frame downtown’s evolution
numerically: For the buzz these days is all about
numbers, in the context of the burgeoning housing
market that is transforming what Stella Royce says
was a “sleepy town” two decades ago
into a vibrant, resurgent city.
Consider that only 10 years ago there were about
1,200 housing units and 2,000 residents in the
downtown area, according to a 1995 Downtown Housing
Task Force report. Since then, more than 1,300
apartments and condominiums have been added and
an estimated 800 more are planned or under discussion,
according to city planning department figures.
And a 2004 city-commissioned study by New Jersey-based
Zimmerman/Volk Associates conservatively projects
that the housing market potential for downtown
is an additional 355 dwellings a year for the next
five years. (Downtown is roughly considered the
area bordered by Sixth and Wealthy streets on the
north and south, respectively, and Prospect and
Seward avenues on the east and west, respectively).
Those numbers have generated headlines
broaching too-much-too-soon concerns of housing “saturation,” countered
by assurances from developers, Realtors and city
planners that supply would not exist without healthy
What lies ahead will likely coalesce somewhere
between the divergent viewpoints. Until then, the
only in-focus view of downtown housing development
is taken from the known, rather than the projected:
an analysis built on asking not what downtown housing
development can do for Grand Rapids, but rather
what has that development already done?
Something for Everyone
Jay Fowler, executive director of the Downtown
Development Authority, said urban housing’s
comeback has diversified the city in several ways.
Comparing downtown to what it was 20 years ago — essentially
an office park — it is much more of an active
neighborhood,” he said.
If “comeback” implies
a return to what was, it’s tempting to apply
a metaphorical “big-bang” theory
to the current housing boom: Perhaps the downtown-living
era that peaked in the post-World War II decade
before exploding into suburban flight in the ensuing
40 years is simply recurring in Grand Rapids, as
people gravitate back to the urban core.
In some ways, it does seem it has cycled itself
through,” said Greg Metz, partner in Lott3Metz
Architecture, which developed a dozen apartments
in downtown’s Donovan Building. “Maybe
downtown is the new thing again. It’s evolution,
but it’s also returning to how it used to
be as people rediscover downtown.”
Yet, they are not returning to what
was for a couple of reasons. First, the demographic
The Zimmerman/Volk study targets two distinct groups — empty
nesters and 20-to-30-something “millennials” — as
the primary downtown buyers and renters of the
present and future, as opposed to the approaching-middle-age-with-a-young-family
consumers of the past.
I’m single, I’ve never married, have
no children and I’m active socially,” said
Joseph Niewiek, a “sub-30” downtown
condo owner. “People aren’t getting
married at as young of an age anymore.”
Secondly, the single-family homes
downtown-area neighborhoods have given way to other
forms of housing. The Zimmerman/Volk study identifies
no single-family detached units in its “appropriate
residential mix” for potential downtown development
(likely due to lack of available property), instead
targeting loft apartments and/or condos for rent
or purchase, as well as “row” housing
(brownstones, for example) or townhouses.
That housing mix alone doesn’t necessarily
preclude families from living downtown, but when
combined with other family-friendly factors — for
example, access to schools, desire for a yard or
play area — the modern demographic lines
are clearly drawn.
Downtown housing and its amenities are a lifestyle,” according
to city planner Eric Pratt. “It creates an
environment that appeals to a different consumer.”
That doesn’t rule out diversity.
Lost in the glare of glamorous $1.2 million condominiums
and penthouse living is the across-the-income-range
makeup of existing
downtown housing and residents. For example, 38 percent of the nearly 1,100 apartments
developed in the past decade provide housing to people on limited incomes, including
college students and people with disabilities.
Actually, the market for high-end units is very thin,” according to Fowler. “In
order for downtown housing to be successful, there has to be that broader market.
We’re not just building condos for lawyers who work in law offices. The
market is for working-class people too.”
Included in that demographic are
people who work service-industry jobs — in
downtown restaurants and hotels, for example — typically with $25,000-or-less
annual salaries that preempt purchase of a 1,200-square-foot luxury loft. Yet,
many of these people lack the transportation they would need if they couldn’t
live close to their places of employment.
The healthiest neighborhoods are diverse neighborhoods,” according to Dennis
Sturtevant, chief executive officer for nonprofit Dwelling Place, which provides
housing to low- to low-moderate income earners. “And I mean diversity in
many different ways — land use, the makeup of folks who live downtown.”
Sturtevant concedes perception is
a “huge issue” in pursuing
projects committed to helping people in challenging circumstances, including
But downtown Grand Rapids, for the most part, has been very accepting and affirming
of the need to encourage diversity,” he said. “There is
the recognition that displacement does not have to be a consequence
What’s more, “low income” is not synonymous with “indigence,” and
affordable downtown housing can be a means as well as an end.
For example, Dwelling Place plans are progressing for the Division Avenue Martineau
Project, which would create 23 live/work loft spaces for emerging artists and
their families. Rents are expected to be under $600 per month for two- and three-bedroom,
850- to 1,700-square-foot apartments, which would feature large open areas, moveable
glass walls and potential gallery space. The building plans also include commercial
space, an attempt to combine affordable housing with economic development, according
The Martineau Project, which encompasses
renovation of four vacant buildings, is emblematic
of yet another aspect of downtown housing
It has less to do with new construction (although there is some)
is called “adaptive
re-use of existing structures,” which often mixes residential
with commercial uses.
Consider this sampling: The 237-unit
Boardwalk Apartments are housed in the former Berkey & Gay
furniture factory; the 101 Ferguson Apartments
are housed in what was formerly Ferguson
109 Globe Apartments
in a series
of buildings constructed between 1903 and 1928; and the apartment-to-condo
conversion underway at the Peck Building is taking place in
a structure built in 1875.
Fowler estimates that 20 years ago downtown had 75 empty buildings. Now there
are only about a dozen.
Almost all of them have been redeveloped as either residential or commercial
developments,” he said. “And there is a great variety of housing.
One type doesn’t meet the needs of everyone but there
is something for almost everyone.”
Developer Jon Rooks shares Fowler’s satisfaction
with adaptive re-use.
City government is the downtown property manager and it has done a great job
in the last five years,” said Rooks, as he sat
in the upper-level solarium of his Monroe Terrace condominium.
Warm spring temperatures prompted Rooks to open one of the sliding glass doors
in the solarium, inviting the breeze to rustle his papers and muss his hair.
But he remains unflappable when it comes to the winds of change downtown.
I know downtown is better than it’s ever been and I only see it getting
better,” he said. “It’s easy
to see why people want to live here.”
It’s also easy to see from whence Rooks’ optimism
stems. Through his Parkland Properties, Rooks has
24 luxury condominiums
in Monroe Terrace and 25 more in the Peoples Building.
All of them sold within weeks of completion.
His company is developing 151 additional condos in Union Square, formerly home
to Union High and West Middle schools, due to open in spring 2006.
Rooks likes rehabbing old buildings for a number of reasons. New construction
is extremely expensive, driven by prevailing steel, fuel and other volatile costs.
He enjoys the creative challenge of blending old and new. And he likes the fact
that his clients like it too.
Buyers lean toward creative, adaptive re-use,” he said. “Our
Grand Rapids buyers are smart. The young ones are
smart, the empty nesters are smart,
the entry-level buyers are smart. They research.
They look at potential appreciation. And they take
the tax rates.”
Union Square, Monroe Terrace and
the Peoples Building are all in tax-free zones,
established by city
leaders as market-based
and investment. The concept has certainly worked
in terms of
but he regards other indicators as truer tests of downtown living’s
There has to be reward for your investment,” he said. “Whether it’s
a house, a condo or an office building, if it’s
a good investment, people can rationalize making
condos have appreciated
to $50,000 in less than a year. They have become
a better investment here than in
And that investment goes beyond
homeowners. National City Bank’s
Community Development Corp. has invested $18 million
in downtown Grand Rapids projects.
I am very confident we do need additional housing by way of condominiums at various
price points,” said Jefra Groendyk, National City division manager for
investment/real estate in West and Southwest Michigan. “I don’t know
what the right number is, but as projects become available, we’re
going to get to a point where developers will determine
that on their own.
Developers in this community are very smart — they’re
not going to put up a project that they think will
The current market bears that out.
The five condominium projects (of eight units or
more) completed in
the last 10 years averaged
as of this
writing, with two — the Peoples Building and Monroe Terrace — at
Groendyk added that lenders’ confidence
in developers is complemented by other checkpoints
that could help
demand. When lenders
underwrite projects, they usually factor in pre-sales
as a good indicator of market demand, Groendyk
said. A typical
on a mid-rise
be 50 percent, meaning that if 100 units are planned,
50 of them
would be pre-sold.
So it’s not a matter of, “If you build it, they will come,” but
rather, “If you are building it, many of
them have already come.”
There is always the opportunity for saturation and vacancy on the market,” Groendyk
said. “But not all proposed projects will
hit the market at the same time. Ideally, it would
of a process.”
Worth the Wait
Darcey Critchell, a single mortgage broker and former suburban homeowner who
moved into a downtown condo last fall, said the changes are already evident.
Grand Rapids is growing,” she said. “It’s
exciting to be down here. I never thought that
as a city we would be where
But for all the talk of a “boom,” the operative word remains “gradual” when
it comes to downtown development. Housing is only
one component in the domino effect that must include
support services growth (grocery and drug stores,
Downtown dwellers have to be patient,” Rooks said. “Their
expectations will be met eventually. There is already
great entertainment downtown,
which drives residential, which drives retail.”
Emblematic of that formula is Monroe
Center, home of the 10-unit Front Row Condominium
this month’s downtown residential tour. Jimmy
John’s Gourmet Sandwich Shop recently opened on Monroe Center, the first
location for independent franchisees Tom Kirkpatrick and Phil Maguran. The shop
joins several other businesses that have located on the block between Ionia and
Division streets, including a women’s clothing
boutique, shoe store and others.
Maguran said he and Kirkpatrick did their homework before locating downtown,
which Maguran termed the business center of West Michigan.
In the past three or four years, I’ve noticed a tremendous change in terms
of what downtown is looking like,” Maguran said. “It’s an ideal
situation for someone who wants to live and work there. And just from walking
around, you can feel it in the air — the
excitement of being downtown.”
Which truly does bring the downtown living discussion full circle.
Twenty years ago, Stella Royce said
she and her husband thought it would be fun to
could be “right in the center of things,” where
they had easy access to their beloved Grand Rapids
Symphony, a variety of restaurants and all the
other cultural amenities
Two decades later, the atmosphere is even more intoxicating.
The momentum is so enormous with the things that are happening downtown,” Charles
Royce said. “Why would you want to go anywhere