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City of Muskegon takes on stalled apartment development | News

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City of Muskegon takes on stalled apartment development

MUSKEGON, Mich. (WZZM) -- The City of Muskegon is taking over an apartment project from a private developer after the work stalled for several years.

If successful, the development would create more housing options in the heart of downtown.

The City is already in a development agreement with Allen Edwin Homes to build Midtown Square. The nine single family homes are four blocks from downtown.

On Wednesday, city leaders were showing off their new housing project that will tower over Western Avenue.

"You have never seen anything like this," said Mohammed Al-Shatel, City of Muskegon Director of Public Works.

This one will be 34 market-rate apartments built inside an eight-story building that used to be a bank. The project is called Highpoint Flats -- and the city is just getting started. "Stage one out of ten maybe," Al-Shatel said.

The apartments will cover six floors, said Al-Shatel, "and some type of commercial development on the first two floors."

Commercial developers may even find a new use for the former bank's massive vaults.

The city has preliminary estimates on the cost of renovations, according to Al-Shatel. "We are talking in the neighborhood of over $8 million."

For now, the city can only say a variety of funding sources are being pursued to cover that cost. The city spent $400,000 of general-fund reserves to buy this building, one next door, and four other vacant lots that surround the two builds. All the properties were privately owned.

"We are saying, 'We are going to invest in ourselves; let's get it done,'" said Debra Warren, a new Muskegon City Commissioner. Warren said she believes in this project. "I think that in combination with the colleges and the college presence down here, it will bring more positive attention to our community."

The land is in a Renaissance Zone, which means residents would not pay state and local taxes until 2024.

Long-term ownership of Highpoint Flats is not part of the city's plan, Al-Shatel explained. "We are hoping to flip it, basically, to somebody else who may be in the business of running apartments.  As you know, city government is not in the business of renting and leasing."

An apartment model unit built by the building's previous owner remains in place on the sixth floor, offering a glimpse of what the downtown apartments may eventually look like.


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