A wrecking ball was looming over four old buildings in the 100 block of East Michigan Avenue in downtown Kalamazoo until Portage developer James Dally came along.
Dally, president of
MAVCON Properties LLC headquartered in Portage, says he knew he could bring the buildings back to life even when others told him wasn't possible. In the latter part of 2012 his project known as the Metropolitan Center was completed much to the surprise of many in the community who didn’t think the buildings were worth saving.
"This was a project that just about everybody told me couldn’t be done," Dally says. "But, you’ve got these very special buildings in a very special location which aren’t hidden on the mall. It was mind-boggling that nothing had been done with them."
In 2001 officials with Downtown Tomorrow Inc., an arm of
Downtown Kalamazoo Inc., assembled the property and had gotten ownership of it over a 10-year period. During that time ideas had been put forward, but dirt was never turned, says Steve Deisler, president of DKI.
"We were very close to moving forward with tearing down the buildings and finding someone to put up a new building," Deisler says. "We were talking to him (Dally) about a project on West Michigan Avenue and he asked what else was available downtown. We told him about the East Michigan properties and I think it was a little bit of a shock when he saw the condition the buildings were in."
MAVCON acquired the buildings from D.T.I. in 2010 for $1.5 million. The
Kalamazoo Community Foundation offered $1.25 million in financing to the developer.
The Metropolitan Center has 14 layers of funding, including federal New Markets Tax Credits as the largest piece, followed by federal and state historic tax credits, state brownfield tax credits and funding from the city's Brownfield Redevelopment Authority and Downtown Development Authority, among others, says Joe Agostinelli, vice president of governmental affairs for MAVCON.
"This was the second most sophisticated in terms of financial complexity of any state redevelopment," Agostinelli says.
The buildings are more than 140-years-old and had seen little activity in 50 or 60 years.
They now house 18 one-bedroom apartments and six two-bedroom apartments, all of which are occupied. These units range between 1,000- and 1,600-square-feet and six of them are leased at discounted rates of between $560 and $800 a month to tenants with an annual income of $35,000 or less. Market rate units range from $900 to about $1,674.
The income-qualified units were the result of
HOME program funding which is designed to build workforce housing. Occupants of these units include a nurse at Bronson Hospital and a clerical worker at Western Michigan University. Under the New Market Tax Credits the rent on these units can’t increase for a seven-year time period.
"These units have a modern, industrial loft feel that doesn’t exist downtown," Dally says.
In addition to the residential part of the $12 million project, PNC Bank relocated from its former location at 108 E. Michigan Ave. into a 5,500-square-foot space at the Metropolitan Center and a Subway restaurant also moved into a new space in the development. Subway’s former location will be available for occupancy as soon as it’s renovated.
"We only have two commercial spaces left and we have a waiting list for the residential units," Agostinelli says. Close to 80 percent of Metropolitan Center residents are single young professionals and the remainder are empty nesters. A number of these tenants chose downtown because they are able to walk to work and want an urban living experience.
"A spinoff of the 2008 crash was the difficulty of getting a bank loan to finance a home of one’s own," Agostinelli says."It’s easier for people to rent. We’ve got a few tenants who have the means to buy, but they would rather rent."
Deisler says rental properties downtown are doing very well, with few if any vacancies.
"Young people want urban living with walkability and empty nesters want the excitement of an urban experience," Diesler says. "Kalamazoo’s downtown has got a little bit of that now with the many restaurants, specialty shops, and entertainment venues."
However, the work involved in turning the 100 East Michigan Avenue buildings into the Metropolitan Center was not easy and Dally admits to questioning his decision halfway through the development process. He relied on the expertise of specialists in many areas so that as much of the original construction materials in the buildings could be saved and used.
A student attending a college out West was brought in to study the timber in the buildings because the quality of timber used in the buildings is no longer available. More than 500 hours were spent researching the buildings with assistance from historians at the Kalamazoo Public Library, Kalamazoo Valley Community College, and Western Michigan University. Photographic prints were found of various events downtown which had the buildings in the background. Finally, a photo was found on eBay which provided a good look at what the buildings had looked like in their heyday.
Dally says he and his team had to develop their own mortar mix for bricks, some of which were found buried underneath the site of a parking lot on West Michigan Avenue. They also had develop stabilizers for the buildings which were in very bad condition.
Deisler offered up a laundry list of things wrong with the buildings before Dally got to work, including leaky roofs, unstable beams and joists that needed to be reinforced before any work could be done, and old mechanicals that needed to be removed.
"The challenge was assembling a team of tradesmen and convincing them these buildings could be fixed," Dally says. "With historical buildings you have to take everything you know about new construction and throw it out the window."
Because of the age of the buildings, Angostinelli says certain standards had to be met before anything could be removed or replaced. MAVCON crews also had to meet National Park Service guidelines.
"We built under LEED guidelines and with sustainable construction procedures," Dally says. "We also called upon a lot of environmental specialist and had an environmental company do all of the abatement."
Dally says he’s very happy with the results and is looking ahead to some other projects now that the Metropolitan Center is finished.
"I’m very happy with the results on all accounts," he says. "We accomplished a lot of things we were told we couldn’t get accomplished."
Jane C. Parikh is a freelance reporter and writer with more than 20 years of experience and also is the owner of In So Many Words based in Battle Creek.