Slowed or stalled housing developments in Detroit hope to pick up pace
Construction has moved briskly this spring on a new grocery co-op store along Woodward in Detroit's North End.
The same cannot be said for the rehab of a nearby and vacant four-story, 44-unit apartment building that is a block away at 30 E. Philadelphia St.
That job at Quaker Apartments has been stalled for well more than a year at roughly 85% complete. The owner has been trying to sell the 100-year-old building in its unfinished condition, so far without success.
Detroit development is never easy, and Quaker Apartments is just one of various residential rehabs and new builds that have gotten started or somewhat started since the COVID-19 pandemic, only to encounter delays, slowdowns or some unforeseen challenge.
Fortunately, developments often overcome such obstacles in time and eventually do get done.
Neighborhood residents say the Quaker Apartments building has been vacant for many years and was once an eyesore. Images on Google Streetview from the late 2000s and early 2010s show it boarded-up and with a trash-strewn lot.
The building was sold for $190,000 in November 2017, land records show. The buyer, Fahad Sultan, went on to undertake an extensive rehab in hopes of bringing the building back to life.
In a phone interview, Sultan recalled how the rehab work came to a halt once the pandemic hit. It later restarted but then stopped again, he said, this time because of a personal issue.
Early last year, he put the unfinished apartment building up for sale for $4.2 million. After several price cuts, it now lists for $3,375,000.
Sultan said he is in discussions with potential buyers. But if he still can't sell the building, he is considering restarting the rehab work to finish it.
“Either we are going to sell it or maybe we’ll start back to work in June,” he said.
'Art Apartments' still to come
There are other stalled housing developments.
The Osi Art Apartments, 3820 W. Grand River, is an all-new and architecturally unique development that will have 30 apartments and ground-floor retail space.
The project had a fall 2020 groundbreaking and an expected 2022 completion. But while much of the structure is built, it isn't yet complete, and neighbors haven't seen many construction workers at the site for months.
The project's development team also is working to build the 38-unit Sawyer Art Apartments, at 7303 W. McNichols, in northwest Detroit near the University of Detroit Mercy.
That affordable housing development had a December 2021 groundbreaking ceremony. And a block of old empty buildings were demolished last year to make way for the new building.
But vertical construction has yet to start.
In an interview last week, Izegbe N'Namdi, whose father, art gallery owner George N'Namdi, is one of the Osi Art and Sawyer Art developers, said both projects are still happening and will be finished.
For Osi Art Apartments, there was a construction delay with switching to a new general contractor. Once the new contractor is in place, they hope to restart work and perhaps finish by the fall, she said.
As for Sawyer Art Apartments, there is environmental site work that they're hoping to do this summer, she said.
"Once we get through the summer phase, then we will start building up from there," she said.
She said financing for both projects remains in place and hasn't posed any problems.
"We are very grateful for both communities with their understanding of the timing and we are looking to get it done," she said.
She added, "We believe in the locations and are very heavily invested in this as private investors. We don't start something to not finish it."
Financing gap delays Lee Plaza
Financing has posed a challenge — and brought delays — to the planned rehab of long-vacant Lee Plaza at 2240 W. Grand Blvd., about a mile west of New Center.
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Plans were announced in January 2022 to redevelop the 16-story tower as a mix of roughly 177 market-rate and senior apartments.
But since then, rising construction costs and financing costs have opened up a financing gap of about $10 million, according to a project spokesman. The development team — Roxbury Group and Ethos Development Partners — is working with the city and Michigan State Housing Development Authority to close that gap. They hope to start on the rehab work by the end of the year.
Fisher 21 Lofts
Another high-profile redevelopment that was announced early last year but has yet to start is an ambitious plan to transform the long-abandoned Fisher Body Plant No. 21 into more than 400 apartments.
This industrial-to-residential conversion, to be known as Fisher 21 Lofts, underwent a Community Benefits process last spring. Nearly 60% of its $139 million in costs are to be covered by a medley of public funding sources, including tax credits, tax breaks, a Brownfield tax capture and state funding, according to project documents from last summer.
Detroit developer Richard Hosey, who is co-developing the project, said last week that it is still coming along. They hope to secure the site from trespassers and undertake cleanup and interior demolition work by the end of the year, and then close on the financing shortly thereafter.
"We’ve been getting a lot of enthusiastic response from local Detroit contractors and are working through the plans with them as we wrap up the financing and the capital stack," Hosey said. "So it’s been moving along very well. Of course, there are always twists and turns as you navigate interest rates and everything else.”
2 projects are close to opening
Another one of Hosey's housing developments is almost ready for its first residents.
That project, Six55 Willis, is a newly constructed 36-unit building at 655 Willis St. in Midtown. It took shape during the pandemic and is nearing its final phase of inspections. Leasing could potentially start in late June, Hosey said.
One long-awaited project that recently got underway is redevelopment of a former four-story Studebaker service center, 411 Piquette, in the city's Milwaukee Junction area, into 161 apartments.
The redevelopment is called Piquette Flats, and all of the units will be offered at below-market rents to income-qualified occupants. Construction work began this spring once the developer, Detroit-based The Platform, secured a $29.9 million construction loan with Flagstar Bank through the Bernard Financial Group.
Contact JC Reindl: 313-222-6631 or jcreindl@freepress.com. Follow him on Twitter @jcreindl. Read more on business and sign up for our business newsletter.
This article originally appeared on Detroit Free Press: Slowed or stalled housing developments in Detroit hope to finish