Developer's Condo Plans Continue

April 27, 2009
By Dave Alexander
Muskegon Chronicle

MUSKEGON -- Even as he takes over ownership of the Shoreline Inn & Suites in downtown Muskegon, Grand Rapids developer Jon Rooks continues to make progress on his Highpoint Flats Condominiums.

Rooks' Parkland Muskegon LLC is moving forward on redevelopment of the former Hackley Union Bank/Comerica building at West Western Avenue and First Street into 70 residential units that include 24 new units to be built just east of the eight-story bank tower.

Parkland has a contract with Clifford Buck Construction Co. of Muskegon to complete the Highpoint Flats project. Work has begun on a model in the bank tower to be ready for tours by the end of June, Rooks said.

With Highpoint Flats in the initial construction phase and the Shoreline Inn now under Rooks' ownership, the developer has become a major player in downtown Muskegon's redevelopment.

Rooks' Parkland Acquisitions LLC purchased the Shoreline Inn's mortgage in late 2007 and ended up in a legal battle in Kalamazoo Circuit Court over the mortgage with the hotel's founders, John and Susan Payne. An out-of-court settlement last week ended with Rooks owning and operating the Shoreline Inn, its marina and restaurant.

Rooks told The Chronicle that as he begins working on the operations and long-term future of the Shoreline Inn, he has Highpoint Flats in the position he wants -- even in a difficult economy and depressed West Michigan condominium market.

The $10.5 million Highpoint Flats project received an extension of its state low-tax Renaissance Zone status through 2023, meaning residents pay no Michigan income taxes, city income taxes, or property taxes for those years.

Late last year, the Muskegon Planning Commission also granted Rooks a change to his "planned unit development" zoning for the Highpoint Flats, eliminating commercial uses in the bank tower and newly constructed units. Rooks said the real estate market in downtown Muskegon would not currently support new commercial space.

"The city has really made every effort to make this project a go," Rooks said of city support for the zone change and for state approval of the tax-zone extension.

Rooks said he is prepared to go ahead at the same time with the bank tower renovation and the new construction. However, Rooks and his potential condominium owners have to navigate some difficult credit markets.

"We are not going to use financing as an excuse for not moving forward," Rooks said. "We will do it and finance it ourselves."

Of the 70 units, Rooks said he has reservations for 32 of them. The trick in this mortgage market is to convert those reservations to purchase contracts and obtain financing for the purchasers.

Being marketed as "your urban lakehouse," Highpoint Flats will take the historic downtown bank building and develop residential units with floor-to-ceiling windows and outside balconies. The units are expected to be priced at $89,900 to $300,000.

"The ultimate weapon against the economy is the Renaissance Zone," Rooks said. "It is the best tool in the state's toolbox of incentives. And we got zone extensions right here in Muskegon."