Michigan Locations

Downtown’s Merchants Building Slated For Redevelopment

Method Development LLC plans to revamp the Merchants Building in Detroit into a 135-room hotel. The $44 million redevelopment plan includes hotel space, and food, beverage and event space, as well as a rooftop bar. The $44 million price tag includes $5.9 million in building acquisition cost, $21.5 million in hard costs and $16.6 million in soft costs. Kraemer Design Group is project’s architect. This hotel would be one of many at varying development stages in and around downtown Detroit. The project is being financed with $16.7 million in equity and $27.3 million in debt.

Detroit City Airport ALP Approved By The FAA

The Federal Aviation Administration has given a thumb’s up to the city of Detroit’s Airport Layout Plan (ALP) for the Coleman A. Young International Airport. The ALP is expected to net about $100 million for airport development over the next 10 years. According to Mayor Duggan, the too-short runway made the airport nonviable. The grants will be used to add new hangars, a control tower, taxiways, and to improve the safety of the existing runway. Plans for the return of the Davis Aerospace Technical High School to the city airport will also be funded. The city previously received $111,000 in state and federal monies to fund plans for the airport, including the ALP.

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Detroit Regional Partnership Aims to Entice Industrial Development

The Detroit Regional Partnership has created the Verified Industrial Properties web portal, a repository for detailed information on sites in an 11-county focus area, including Wayne, Oakland, Macomb, Washtenaw and Livingston counties. The partnership views the clearinghouse as a way to get rid of leg work and improve the accessibility of metro Detroit site information. Property owners pay to have their sites listed in the web portal. Civil engineers have vetted nine sites, considering zoning, topography, geological conditions, transportation, wetlands, etc. Another 15 sites are under evaluation.  Some of the sites in process are large and prominent: The former Summit Place Mall property and 500+ acres of Lyon Township land. The partnership says its sites include urban, suburban and rural.

Inflation Impacts Property Taxes With Highest Increase Since 2007

Michigan homeowners can expect to see bigger than normal increases in their summer property tax bills. Thanks to this year’s inflation, many need to prepare for even bigger hikes next year. The inflation rate adjustment for this year’s property taxes is 3.3%, the highest it has been in 15 years. The rate is the maximum increase in taxable value that can apply this year to Michigan homes that haven’t changed ownership or seen additions to the property. The multiplier hasn’t been over 3% since 2007. Inflation’s impact on food and gas prices are obvious to consumers, but its impact on property taxes can be unexpected and somewhat hidden.

Perrigo Hosts Grand Opening At New North American Headquarters

Perrigo, the Dublin-based producer of self-care products, hosted a grand opening sneak peak of its new North American Corporate headquarters in downtown Grand Rapids. The ceremony included its project partners, Grand Rapids Mayor Rosalynn Bliss  and The Right Place President and CEO Randy Thelen. Located at MSU’s Grand Rapids Innovation Park, the project began construction in April 2021.  The $45 million investment was completed by Health Innovation Partners.

Michigan-Based Development Firm Acquires Affordable Housing Portfolio

The Michigan minority- and woman-owned development firm, Ginosko Development Company, along with New York-based L+M Development Partners, has secured a nine-property portfolio in Michigan that includes 1,640 units.  One of the portfolio’s properties includes Coventry Woods, a West Michigan senior apartment complex. The rest of the portfolio properties are in Detroit, Saginaw, Pontiac, Canton, Center Line and Monroe. Over half the units are for seniors. Seven of the nine properties have Department of Housing and Urban Development Section 8 contracts, and two are restricted to households at or below 60% area median income.

Southfield Center Shopping Mall Struggles To Keep Afloat

The Southland Center shopping mall is struggling. According to New York City-based Trepp LLC, the shopping mall is underwater on its commercial mortgage-backed securities debt (CMBS).  The mall was appraised for $66.9 million in September after it went into special servicing. It owes $64.5 million on its 2012 $78.75 million Barclay’s loan. Rialto Capital Advisors LLC is the special servicer and can determine whether to foreclose on the loan or arrange an agreement or loan modification. Special servicers are appointed upon default of a loan.

Mortgage Rates Surge Upward As Q3 Earnings Post

Rising interest rates are having a big effect in Southeast Michigan. According to Freddie Mac, the 30-year fixed mortgage rate is higher than 7%. This surge hasn’t been seen since April 2002. The U.S. Federal Reserve is hiking rates in order to control inflation. Detroit-based Rocket Mortgage parent company Rocket Companies Inc. will soon be reporting its third-quarter earnings on Nov. 3, providing a better picture of how mortgage companies will fare in the future months. Ann Arbor-based Home Point will report its earnings on Nov. 10. Pontiac’s UWM has not released the date of its third-quarter report.

New Costco Business Center Is On The Horizon

The planned Costco Business Center in Southfield is one step closer to happening. Southfield City Council approved Contour Companies LLC’s sale of the property at the southwest corner of the former Northland Center site. When complete, it will be Michigan’s first Costco Business Center. The center would be geared toward small businesses, restaurants and the hospitality industry. Michigan’s Costco Business Center would be one of 15 located in the United States. Project demolition has started, and framework for the buildings has begun. The overall plan will bring more than 2,800 housing units to the site.

COVID Emergency Rental Assistance Staves Off An Eviction Tsunami

With the ending of the federal eviction moratorium on August 26, local legal aid funds are still being sorted out. Since the initial eviction moratorium, the U.S. Treasury has paid $25 billion to states and local governments for COVID Emergency Rental Assistance. From May to August, a total of $181,821,906 has been paid out to Michigan residents. The pace of the disbursements will continue to accelerate into September, according to the MSHDA communications director. The Director of Litigation at the Legal Aid of Western Michigan estimates that applicants are waiting 1 to 2 months before receiving a check. The processing rate varies by county and ranges from 26-72%.

Cannabis Retailer Opens in Coldwater

Skymint Inc., Michigan’s largest cannabis retailer, opened its 15th store in half of a vacant department store in Coldwater. According to the company’s president of retail, bigger spaces like the former Sears building are appealing because it gives the store a big blank canvas with which to work. The artsy, boutique-vibed store offers 60 cannabis brands. Skymint has grown quickly since entering the retail market in 2019. It can also be found in Bay City, Big Rapids, East Lansing, Flint, Hazel Park and Lansing.

Affordable Housing Options Scarce in Michigan

According to a report released by the National Low Income Housing Coalition, a two-bedroom apartment in Michigan is unaffordable for minimum wage renters…unless they work 77 hours a week. Affordable housing was an issue prior to the pandemic, and the economic upheaval has only made it worse. Lawmakers are doling out billions of dollars in emergency rent aid, but experts agree that this is only a short-term fix. Communities need more affordable housing options. With the eviction moratorium expiring, evictions are expected to increase, making it tougher still for displaced tenants to find a place to live. Governor Whitmer plans to use $100 million in federal COVID-19 relief dollars to create 2,000 new affordable rental homes, with funds going toward grants and loans for development, preservation of existing housing and security deposit assistance.

Charlevoix’s New Ordinance Inhibits Blight

Charlevoix City Council has approved a property maintenance code to address declining properties before they reach blight status. The international Property Maintenance Code Ordinance is designed to supplement the Dangerous Buildings Ordinance.  According to zoning administrator Jonathan Scheel, the city didn’t have any type of property maintenance code to prevent a building from becoming dilapidated. The new code will give the city the ability to intervene and require deteriorating structures to be corrected before they become unfixable issues.

Habitat for Humanity Awarded Grant Monies

Michigan’s Habitat for Humanity received a $2 million federal grant. The grant will cover home repair needs for 160 low-income families. Grant funding comes from the U.S. Department of Housing and Urban Development’s Healthy Homes Production Grant Program. It’s part of $104 million plus awarded from HUD to 60 nonprofit organizations and government agencies.  With the addition of this grant, Habitat for Humanity will increase its current repair program by 50%.

City Ordinance Supports Construction of Accessory Dwelling Units

Charlevoix’s city officials are searching for solutions to the area’s affordable housing shortage. Accessory dwelling units (ADUs) are small outbuildings that can be used for a variety of purposes, from guest apartments to home offices. At a January 10 meeting, Charlevoix’s planning commission  recommended approval of regulations that would make ADUs easier to build in residential areas. The ADUs increase property usage in residential districts, provide extra space for families, and allow space for multi-generational homes that support familial caretaking. They create income sources when they serve as rentals. The accessory units also increase property values.

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U.S. Pending Home Sales Decline

Limited home inventory is restricting the real estate market, causing U.S. pending home sales to fall 4.1 percent in February for a fourth straight month. With a limited number of properties for sale, home price tags remain elevated. When combined with 30-year fixed mortgage rates at a three-year high, homes are less affordable. The increase in home prices and rising mortgage rates can add up to another $200 to $300 in mortgage payments per month.  According to the NAR,  these factors have pushed up mortgage payments by 28 percent from February of last year.

Mortgage Companies Expecting Leaner Year in 2022

The year 2022 promises to be a leaner year from mortgage companies. The mortgage industry rebounded in 2020 and 2021, propelled by rock-bottom interest rates and consumer demand. In 2022, things are changing. Mortgage rates increased to a level not seen since December 2018. The average 30-year-loan increased from 4.42 percent last week to 4.67 percent on Thursday. Rates have increased more than a percentage point and a half since the new year.  Fewer consumers in the refinance pool and the limited housing inventory are contributing to the rate increase.

Michigan’s Foreclosure Numbers Highest in the Country

Michigan has the highest number of foreclosures than anywhere in the country, according RealtyTrac. However, experts say this isn’t a sign of a worsening housing market. Michigan’s 2022 January figures represent a 622 percent increase over the totals in January 2021. The big leaps are due to the ending of moratoriums that kept foreclosures from moving forward. Wayne County had the bulk of foreclosure activity, and most of those were old foreclosures that were in the process a long time. According to the vice president of RealtyTrac, Michigan’s backlog is moving faster than in other states. He expects that it could take several months before the backlog is cleared out, but that the figures are not a cause for concern.