KALAMAZOO — With a dearth of major buildings left to renovate in the downtown Kalamazoo area, developers say new construction will soon be their only option going forward.
Driven by opportunities to meet growing demand for residential living and retail, a number of developers have started to plan and develop new building projects in Southwest Michigan’s largest city.
“We don’t have large-scale manufacturing buildings that are available for renovation,” said Steven Deisler, president and CEO of Downtown Kalamazoo Inc. “We’ve got some retail buildings where the second or third floor still has potential, but a lot (of those) have been done.
“We are heading into the new construction point, and those are much more money and much more complicated to do. But from a developer’s standpoint, they are being looked at more and more.”
While acknowledging that many of the planned projects are too early in the due diligence process to be discussed publicly, Deisler cited the Rise Real Estate project at Arcadia Commons West as one new construction project that’s gaining traction. For the project, the Georgia firm plans to build a mixed-use development on a six-acre parcel.
Rise Real Estate continues to design the project, but the various stakeholders expect to begin seeking public input on the plans in the coming months, Deisler said.
Executives from Rise Real Estate did not respond to an inquiry for comment as this report went to press.
While Deisler was unsure which of the numerous projects in the works would break ground first, he expects them to act as a magnet for further activity in the area once they do begin to take shape.
“That should get people excited, it should get developers excited and get our community excited and spur other fill-in and new projects downtown,” Deisler said.
Now, it’s up to public and private companies seeking to build new developments to identify the right mix of housing, from affordable options to higher-end downtown living aimed at young professionals or retiring empty-nesters, he added.
“We’ve got to find the right mix,” Deisler said. “That’s critical.”
Adding to the options for affordable living in downtown area, Kalamazoo-based NoMi Developers LLC will open Walbridge Common around the first of July. The mixed-use building renovation northeast of the city’s downtown will offer 47 new apartments including efficiency units, as well as one- and two-bedroom units. The 16 “microunits” measuring around 320 square feet with common kitchens and living areas will rent for about $600 per month, including wireless internet and utilities.
To hit that price point and size target, the developers eschewed amenities such as built-in beds and movable walls that are common in other small apartment units.
“Anything that was custom-built for maximizing space didn’t meet the goal of the project, which is affordable housing,” said developer Jon Durham, a partner in the project.
Walbridge Common also has commercial space for a restaurant, but the partners were still seeking a tenant as this report went to press.
NEED FOR SERVICES
Overall, Downtown Kalamazoo Inc.’s Deisler estimated that developers have between 200 and 400 apartment units in various stages of development in the core city and its adjacent neighborhoods, and more are expected.
But a recent study determined the market could absorb many more units than developers have planned. A December 2014 market analysis from Zimmerman/Volk Associates Inc., a Clinton, N.J.-based consulting firm, found that the downtown Kalamazoo market could support more than 1,400 new units.
For developers like Durham, the study drives home the point that Kalamazoo’s downtown can support the type of development his firm hopes to provide.
“That builds confidence because (of) what we have already,” Durham said. “It’s an affirming point when somebody comes and does a study and finds what we’re feeling.”
The expected demand for increased residential units also appears to be driving more commercial development in the area.
For instance, Kalamazoo-based development firm PlazaCorp Realty Advisors Inc. is renovating The Depot at 427 E. Michigan Ave. to house a HopCat beer bar and the fifth Michigan location for Maru Sushi and Grill.
The emergence of several new local and regional restaurants moving into the downtown area begs the question of when the residential demand will help attract more basic services to the city core and its near neighborhoods, Deisler said.
“The residential (component) will keep us a 24-7 downtown, and then you’ve got to provide the services for that,” Deisler said. “That includes not only entertainment and restaurants, but you’ve got to provide the convenience stores and the pharmacies. … If we can offer those downtown for people to walk to, I think it will really make a change and continue to grow the residential side.”