Coming Soon! New Midtown Office Building, south of MLK

[DetroitPlanner]

http://detroit.curbed.com/archives/2...apartments.php Was wondering what happened to this development...turns out it's been flipped from offices to apartments. Hope it all actually comes together...believe it when I see it.

Something is fishy. $485,000 for each apartment unit development costs seems a bit high.

[animatedmartian]

Something is fishy. $485,000 for each apartment unit development costs seems a bit high.

That's improper oversimplified math.

Assuming the overall building size is the same [[75,000 square feet), then having 25,000 square feet of retail [[originally was 10,000) means there's 50,000 left over for apartments [[originally was 65,000 for offices). That comes out to about 735 sq ft per apartment.

If the market rent is $2/sq ft, then average rent within this building should roughly be around $1,470 per apartment [[actual rents will vary depending on the actual size of the individual apartments, but the average should be around that number nonetheless). That's on par with other downtown and midtown rents as of right now.

[DetroitPlanner]

That's improper oversimplified math.

Assuming the overall building size is the same [[75,000 square feet), then having 25,000 square feet of retail [[originally was 10,000) means there's 50,000 left over for apartments [[originally was 65,000 for offices). That comes out to about 735 sq ft per apartment.

If the market rent is $2/sq ft, then average rent within this building should roughly be around $1,470 per apartment [[actual rents will vary depending on the actual size of the individual apartments, but the average should be around that number nonetheless). That's on par with other downtown and midtown rents as of right now.

For there to be 25,000 sq ft of retail and 75,000 sq ft of apartments that means a 4 story building. what is shown is at least a 5 maybe 6 story.

The apartments would be a lot smaller. Yeah you deducted for retail but what about public space like hallways, the residential lobby, possibly laundry or other amenities such as exercise facilities? By your estimation then each property would generate a lot less in rent.

So they start making a profit in what? about 20 years? Just in time for the building to need major maintenance.

[mwilbert]

For there to be 25,000 sq ft of retail and 75,000 sq ft of apartments that means a 4 story building. what is shown is at least a 5 maybe 6 story.

The apartments would be a lot smaller. Yeah you deducted for retail but what about public space like hallways, the residential lobby, possibly laundry or other amenities such as exercise facilities? By your estimation then each property would generate a lot less in rent.

So they start making a profit in what? about 20 years? Just in time for the building to need major maintenance.

Not saying this makes a gigantic difference in the economics, but it looks like they are eligible for about five million dollars in TIF money.

[animatedmartian]

For there to be 25,000 sq ft of retail and 75,000 sq ft of apartments that means a 4 story building. what is shown is at least a 5 maybe 6 story.

It's 50,000 sq ft for the non-retail portion of the building. The total size for the whole building is 75,000.

What is shown is a building that has a two-floor lobby on the north section of the building which means the 2nd floor is an odd size. It's still 4 and a half floors of non-retail plus the first floor retail. And since there's no half floor on the roof of the building, then it can be assumed they added space until the building was a perfect square.

The apartments would be a lot smaller. Yeah you deducted for retail but what about public space like hallways, the residential lobby, possibly laundry or other amenities such as exercise facilities? By your estimation then each property would generate a lot less in rent.

The rents would be slightly higher than my estimation then but still at market rate [[assuming market rate is $2/sf).

So they start making a profit in what? about 20 years? Just in time for the building to need major maintenance.

A couple different things could and will likely happen; 1) Rents continue to go up which means they make a profit quicker than 20 years or whatever, or 2) The condo market gets strong enough to the point that it'd be more profitable to turn the apartments into condos. Either way, a good portion of the owners will get their income from retail even with everything else.

[Spartan]

It's 50,000 sq ft for the non-retail portion of the building. The total size for the whole building is 75,000.

What is shown is a building that has a two-floor lobby on the north section of the building which means the 2nd floor is an odd size. It's still 4 and a half floors of non-retail plus the first floor retail. And since there's no half floor on the roof of the building, then it can be assumed they added space until the building was a perfect square.


The rents would be slightly higher than my estimation then but still at market rate [[assuming market rate is $2/sf).

A couple different things could and will likely happen; 1) Rents continue to go up which means they make a profit quicker than 20 years or whatever, or 2) The condo market gets strong enough to the point that it'd be more profitable to turn the apartments into condos. Either way, a good portion of the owners will get their income from retail even with everything else.

3) The commercial space will bring in much more than $2/sq ft, don't you think? This is where the real profit in owning a building can be, not the residential.