100 Grand River is the new name, Jared. Might want to change the title. Anyway, a rough rendering of the section along Valley Court Park behind the Grand River frontage:
Convexity had proposed a separate six-story, 175-unit apartment complex on the site. In order to meet the requirement, it will now be two smaller condo buildings. A four-story building will house 52 condos along Valley Court. There will be an adjacent three-story building with 12 units attached to a parking garage that can accommodate 411 vehicles.
The building along Grand River:
Plans for the hotel and apartment complex have remained the same. It will include 144 hotel rooms and 176 apartments, a mix of studio, one-, two- and three-bedroom units. A parking garage under the hotel would accommodate 112 vehicles.[/img]
I think that this is the ideal result. For a city of this size, various good-size and good looking buildings are better than one huge building.It fits more with its landscape.
I am a firm believer that if the city removed it's residency requirements and allowed student housing to be built, these buildings would be built immediately without any need for brownfield funds or other tax incentives. There is continued construction down Abbot Road north of Lake Lansing, the demand is still not met.
If the brownfield plan gets final approval, Convexity will recapture all of the new property taxes generated from the development for a period of 23 years starting in 2018. Currently, the properties included in the development have a taxable value of $1.7 million. When completed, development's full taxable value is estimated at $18.5 million in 2021.
Members of the brownfield authority questioned why the estimated taxable value was $18.5 million when $148 million was being invested.
Convexity's lawyer, David Pierson, said that high construction costs raise the total investment while some parts of the development, such as the parking ramp and sewer improvements, do not translate into economic value.
If city council were to approve the brownfield and site plans on Tuesday, then the developers could submit them to the Michigan Strategic Fund, which could approve a $10 million Michigan Business Tax credit for the project, as well.
The earliest that could be approved would be late March, said Lori Mullins, the city's community and economic development administrator. Once the MSF approves the credit, Convexity can tear down the blighted buildings between the People's Church and Abbot Road. Convexity believes those buildings need to remain standing to get the credit.
Anyway, looks like this is moving forward. BTW, how can I split up quotes into seperate boxes? I'm still not used to this format. This was supposed to be three or four different quotes.
I think you can try putting spaces on the blank lines between the quotes to separate them.
Yeah I don't know why this would only have $18.5 million taxable value. If what they are describing is State Equalized Value then that is normally half of the fair market value. If they do build what they are planning, then I believe it would get a higher resale value than $37 million. How much higher I don't know, but the Chandler Crossings development was flipped for $100 million in 2013 [1], though that has 2,772 beds, a worse location (lower taxes though), and is about 15 years old now.
I don't know how many beds this development will have, the article mentioned at the top of the page says a mix of studio, one-, two-, and three-bedroom units. If I count each of those units at 2.5 beds (to average out the studio, one-, two-, and three-bedroom units), and then add in the apartments in the other building and hotel rooms, this development has 744 beds +- 100 due to my assumptions. With that being said, at the high end this development should be worth $30.44 million [2] and at the low end $23.22 million [3].
If Chandler Crossings used MACRS depreciation method with a 15-year recovery period [4], then reversing that value would have put their breaking-ground value at $263 million. Applying the above bed-values to this number (which now has much higher error) would value this development between $80 - $61 million (a SEV of $40 - $31 million).
According to the article at the top of the page, the city is buying the parking garage from the developer for $15 million, so the developer is also taking home $15 million just for doing the construction work here.
Staring at the numbers, it just doesn't look like this project will succeed. At this point I wish the city would just take their losses and sell the city-owned property on the open market. I would rather have multiple developers working on smaller projects than this languishing on for another 10 years.
I'm surprised that details of a seemingly important piece of the financing are up in the air at this stage of the development. I'm also surprised that the city owes over $5.5 million on the Evergreen properties and planned to "sell" them to the developer with no plans to recoup any money or otherwise pay off the debt. I'm just going to assume that given the mayor's strong support and the general headache this project has been for the city, that the council is going to push this through and be done with it.
Comments
The city made them split up the original six-story building:
The building along Grand River:
Is this fairly typical for a brownfield?
Anyway, looks like this is moving forward. BTW, how can I split up quotes into seperate boxes? I'm still not used to this format. This was supposed to be three or four different quotes.
I think you can try putting spaces on the blank lines between the quotes to separate them.
Yeah I don't know why this would only have $18.5 million taxable value. If what they are describing is State Equalized Value then that is normally half of the fair market value. If they do build what they are planning, then I believe it would get a higher resale value than $37 million. How much higher I don't know, but the Chandler Crossings development was flipped for $100 million in 2013 [1], though that has 2,772 beds, a worse location (lower taxes though), and is about 15 years old now.
I don't know how many beds this development will have, the article mentioned at the top of the page says a mix of studio, one-, two-, and three-bedroom units. If I count each of those units at 2.5 beds (to average out the studio, one-, two-, and three-bedroom units), and then add in the apartments in the other building and hotel rooms, this development has 744 beds +- 100 due to my assumptions. With that being said, at the high end this development should be worth $30.44 million [2] and at the low end $23.22 million [3].
If Chandler Crossings used MACRS depreciation method with a 15-year recovery period [4], then reversing that value would have put their breaking-ground value at $263 million. Applying the above bed-values to this number (which now has much higher error) would value this development between $80 - $61 million (a SEV of $40 - $31 million).
According to the article at the top of the page, the city is buying the parking garage from the developer for $15 million, so the developer is also taking home $15 million just for doing the construction work here.
[1] http://www.mlive.com/lansing-news/index.ssf/2013/02/chandler_crossings_community_p.html
[2] 844 / 2772 * 100,000,000
[3] 644 / 2772 * 100,000,000
[4] http://www.smbiz.com/sbrl012.html
Great write-up on ELi about the project, of which will go before the city council tonight: http://www.eastlansinginfo.org/content/council-may-make-big-decisions-blighted-area-tonight
Staring at the numbers, it just doesn't look like this project will succeed. At this point I wish the city would just take their losses and sell the city-owned property on the open market. I would rather have multiple developers working on smaller projects than this languishing on for another 10 years.
At the very least it would be nice if they'd tear down the buildings on Grand River. What a depressing entrance to the city.
I'm surprised that details of a seemingly important piece of the financing are up in the air at this stage of the development. I'm also surprised that the city owes over $5.5 million on the Evergreen properties and planned to "sell" them to the developer with no plans to recoup any money or otherwise pay off the debt. I'm just going to assume that given the mayor's strong support and the general headache this project has been for the city, that the council is going to push this through and be done with it.
The project is a no-go per http://www.lansingstatejournal.com/story/news/local/2017/01/11/developer-148m-east-lansing-project-not-feasible-after-tax-rebate-change/96436436/
Not surprised. It seems the city needs to think of smaller projects instead of one mega project.