Muskegon County busy with redevelopment projects
With a $19 million convention center underway, several projects on the waterfront, a micro hotel and some mixed-use buildings, downtown Muskegon has become an epicenter of development activity along the lakeshore.
“We are in a historic transformation,” said Dave Alexander, the business development manager for the city of Muskegon.
While downtown Muskegon remains arguably the busiest area when it comes to development projects, developments are happening elsewhere around the county as well. Muskegon Area First is tracking roughly 35 projects countywide that total $162 million in new investment over the next 18-24 months, according to CEO Jim Edmonson.
Arconic, an aerospace and alloy metal manufacturer headquartered in Pittsburgh, is wrapping up a $100 million expansion at the former Howmet location in Whitehall, while Mercy Health is building a $20 million outpatient facility in Norton Shores.
Fueled by the aerospace, automotive and medical device industries, Muskegon County also has a very diverse manufacturing base, according to Edmonson.
As well, the new developments are one factor that officials hope will attract talent to the potential 676 new jobs in the county.
“Site visits to employers indicate that developing a pipeline of talent is the number one thing on their radar,” Edmonson said.
Muskegon Community College is working on ways to train new employees, and employers are “thinking outside the box” and bringing students into manufacturing facilities to get them interested earlier, said Muskegon County Administrator Mark Eisenbarth.
Additionally, the construction of new apartment units throughout the county will help attract people to live and work there, officials told MiBiz.
The new developments, coupled with the county’s relatively affordable prices, should continue to fuel the real estate market in Muskegon County, which officials don’t see slowing down anytime soon.
Real estate market
Muskegon County’s commercial real estate market in general is “very active,” said Bryan Bench, a partner at Muskegon-based Core Realty Partners LLC who has worked in the area since 2000.
“It’s a little bit different than it’s been in years past, primarily because of all the momentum and activity in downtown Muskegon,” he said.
According to data provided by Core Realty, 217 commercial properties are currently listed on the market with an average list price of $896,000.
For residential, the average sales price is $162,581, and inventory is low across most sectors of the real estate market, according to Nexes Realty Inc., headquartered in Roosevelt Park, a small city sandwiched between Muskegon and Norton Shores.
The county’s multifamily housing market is particularly busy, with multiple mixed-use projects coming online or in the works, said Edmonson of Muskegon Area First.
“It’s a very strong market,” he said. “We don’t see that really falling off much. Housing prices are edging upwards, an indication that there’s more demand than what’s available.”
That is especially true for downtown Muskegon, where several apartment projects have recently come online, including Lake View Lofts, Terrace Point Landing, Heritage Square, Highpoint Flats and Berkshire Muskegon, a senior living facility.
“We have a window of opportunity for affordability in residential that will close, and we will become closer (in prices) to Grand Rapids,” Alexander said. “We need to move forward as aggressively as possible in the next couple of years when we still have that advantage to price competitively in the market.”
Edmonson said Muskegon County is “ahead of other municipalities” because its zoning laws allow for smaller square footage in apartments and encourage the creation of “market-rate affordable housing.”
Muskegon County features several sites, including the former Sappi Paper Mill and the former West Shoreline Correctional Facility, that could offer opportunities for new developments.
Another possibility is the Foundry Square site in downtown Muskegon, where about 5 acres of property is available for more development. The project is being developed by Great Lakes Development Group.
Meanwhile, some significant square footage is coming online in the industrial market. That includes a 490,000-square-foot distribution center available at 2420 Remembrance Drive and listed for $24.9 million.
“That’s a pretty big nut for us to crack to find users for that kind of space,” Core Realty’s Bench said.
Bench has heard from automotive users that the sector has “flattened out,” but companies in aerospace and food processing seem to be pretty optimistic.
What concerns Bench the most is the office market, which is not taking up as much square footage as it used to because of the changing nature of office work. The trend is bolstered by large health care companies in Muskegon turning their attention to their main campuses in urban areas as opposed to suburban medical office spaces, he said.
“The office side has been the toughest to backfill space county-wide, not necessarily downtown, but in Norton Shores, Muskegon Heights and other areas,” Bench said. “There’s plenty of space available.”
As well, demand for retail space has increased in the downtown market, with mixed-use developments underway to help fill the need, Bench said.
“There’s some nice projects coming online that will start construction this year,” he said. “We’ll still see more demand downtown than probably we can handle, as far as filling small retail spaces.”
Posted By: MiBiz on February 2, 2020. For more information, please click here to read the source article.
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