Detroit’s Eastern Market Area Gains Office Space

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Detroit’s Eastern Market and its food-centric footprint is the target of a $24 million office redevelopment plan. Developer Christos Moisides has big plans for a former cold storage building at 2529 Orleans St. The 63,400 square-foot building would included 55,000 square feet of office space. The remainder would be commercial space that would included a brewery and restaurant. Moisides paid $4.1 million for the building and will spend over $17.4 million on construction and other costs. He is seeking a 12-year tax abatement from the city.

Harper Woods Shopping Mall Proposed for Industrial Development

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Harper Woods’ city planning commission is considering a proposal that would turn the struggling Eastland Center shopping mall into a new industrial/warehouse development. NorthPoint Development LLC is asking for a planned unit development that would raze the enclosed mall and build about 1.03 million square feet of industrial/warehouse space across three buildings on the site.  A 514,000 square-foot building would be built on 36 acres of the site. Another 310,000 square feet would be built on 24.1 acres, and 207,000 square feet would be built on 18.8 acres. 15 acres would remain undeveloped.

Investors Add to Competitive Housing Market

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With limited housing inventory, homebuyers are already over a barrel when shopping for a new home. But add investors into the mix and the market becomes even tougher. Nationally, Metro Detroit has experienced the second-highest increase in the number of investor-purchased homes year over year. Investors are cash buyers who can close more quickly which makes it even harder for buyers getting a mortgage. But for the seller, cash is king and a cash sale allows a seller to move on with their future.

U of D to Redevelop City of Detroit Rec Center

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The University of Detroit Jesuit High School and Academy has purchased the former city of Detroit recreation center and park in northwest Detroit. The 12.5-acre property was purchased in February 2020 for $625,000. As part of the sale agreement, the school will open the renovated center for community meetings and classes, as well as kids’ camps. The all-boys Catholic high school has raised $6.2 million toward the $7.5 million needed for redevelopment. The project will more than double the size of the school’s campus. Renovations on the rec center are expected to be completed by this fall

 

Detroit Coworking Locations Adapt Post-Pandemic

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Prior to the COVID-19 pandemic, numerous coworking spaces were opening or planned in Detroit. While the growth appears to have slowed post-pandemic, and several locations have permanently closed, there are still new coworking locations planned in Detroit.  There are currently about a dozen coworking sites open in the city, with a few more planned in the near future. Some of the new sites are planned for areas outside of the core downtown area.

Detroit Midtown Development Gets a Boost

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Petit Bateau, a $31 million Midtown mixed-use development, received a tax break from the Michigan Strategic Fund. The fund approved a more than $247,000 state tax break to fund environmental decontamination. The 92-unit project also received $2.6 million from the city in tax abatements for decontamination work. Twenty percent of the development’s residential units are set aside for individuals at 80 percent of the area median income or below.

Mall Properties Transition to the Untraditional

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With mall vacancy rate across the U.S. setting new records, it’s no surprise that malls are standing empty or being repurposed. Two new occupants of the Lakeview Mall in Battle Creek are doing just that. A climate-controlled self-storage developer bought the former Macy’s and plans to rent storage units, reachable by an indoor drive-through, and Horrocks Farm Market will move from downtown Battle Creek into the former JC Penney store. This represents the current trend for mall properties. Development experts look toward transitioning these large retail properties into housing, entertainment venues, medical facilities and other non-traditional mall tenants.

 

 

Westin Book Cadillac Penthouse Condo Sets a New Record for Detroit

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A Westin Book Cadillac penthouse sold for $3.537 million. The penthouse sits atop the 31-story high-rise hotel in downtown Detroit. The deed was recorded in Wayne County in December. The sale came at a time when the downtown Detroit condo market was oversaturated. Previously, the most expensive Detroit condo sale was recorded at about $1.8 million in 2017. Incidentally, that condo is also in the Westin Book Cadillac.

 

Midtown Development’s Tax Credits Expire

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The Mid development in Midtown is headed toward a financial loss. The developer is still trying to get the project off the ground. Almost $9 million in Michigan Business Tax brownfield tax credits expired on Thursday, June 10, 2021. The 10-year expiration looms because the development team has not built the promised seven stories of one of its proposed buildings by June 10, 2021. The Michigan Business Tax statute requires projects to be completed within 10 years of the pre-approval letter.

Century-Old 1031 Exchange Tax Break Is On The Chopping Block

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Thanks to a 100-year-old provision in the tax code, real estate investors have been able to roll earnings from the sale of one property into the purchase of another to avoid paying taxes on the gains from the properties they sold. Section 1031 covers a transaction that is commonly called a like-kind exchange and provides a tax deferral on the financial gain of a sale if the proceeds are directly rolled into a similar investment property within 180 days. The Biden administration is taking aim at the tax code in the interest of financial equity. The current administration’s efforts would generate $19.5 billion in tax revenue over 10 years.