Work continues on downtown condo project

MUSKEGON -- The $10.5 million Highpoint Flats condominium project in downtown Muskegon is moving ahead, despite outward appearances indicating otherwise.

Demolition work inside the eight-story former Hackley Union Bank/Comerica bank building at Western Avenue and First Street began this week, according to Grand Rapids developer Jon Rooks.

Buck Construction of Muskegon has been contracted to do the conversion from offices to 70 new downtown residences.

"They have done some really great work on Hackley and Mercy hospitals and the Baker College culinary arts building," Rooks said. "We're excited to have them doing the project."

Rooks said Monday that he hoped to have a model condominium on the building's sixth floor finished this spring. At that point, he said, 34 customers who have made reservations will be asked to sign formal purchase agreements.

Rooks said about two-thirds of those reservations are "solid."

Planned are 70 units, ranging in price from $89,900 to $319,900 for a top-floor, three-bedroom condo.

One aspect of the original plan has changed. Instead of a building addition that would combine ground-floor commercial with second-floor residential units, the addition will be solely residential.

Rooks said he chose to eliminate the commercial portion to simplify financing arrangements for condominium buyers. In this as well as other Rooks condominium projects in Grand Rapids, his Parkland Properties company offers discounted financing arrangements.

"It's much easier when they are 100 percent residential," Rooks said. "Lenders get real nervous when there's a mixed-use component."

That proved to be "a fairly significant, complicated modification," requiring the blessing of the Michigan Economic Development Commission, the Downtown Muskegon Development Corp., and finally the Muskegon Planning Commission.

And it had to be done in such a way as not to jeopardize the project's 20 percent Muskegon Business Tax Credit, its tax-free Renaissance Zone status, previous zoning approvals, and existing agreements with the DMDC.

Getting this change approved was cited by Rooks as the reason for the delayed start of construction.

Rooks didn't comment further on the state of downtown retailing, the potential loss of which concerned some planning commission members.

"Retail would do better if there were more people downtown," he said.