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Developing
a Complex - Whiz-bang Builder Realizes 'Momentum' in
Muskegon |
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December
22, 2002
The Muskegon Chronicle
By Dave Alexander
Patrick Gillespie purchased his first house to fix up
and rent when he was in high school after reading a
book on "creating wealth" through accumulation
of real property.
Now 32, he has founded Gillespie Development, which
announced a proposed $40 to $45 million investment in
the Muskegon area over the next two to three years.
That is part of a planned seven new developments, which
will add 1,600 new apartment units and 140,000 square
feet of office and retail space.
The East Lansing-based apartment construction and management
firm already has 1,000 apartment units, 70 residential
single-family homes or condominiums, 165,000 square
feet of office/retail and a 90-room Courtyard Marriott
Hotel and Conference Center in its real estate portfolio.
Builder Magazine has named Gillespie Development one
of the top 50 builders of multifamily residences in
the nation.
And what was a mainly a Lansing-area, central Michigan
operation has expanded now to include West Michigan.
Gillespie nearly is finished completing the Hamptons
of Norton Shores at Grand Haven and Farr roads - a 104-unit
"high-end" apartment complex.
On the Gillespie Development drawing boards are four
other projects: Catalina Shores in Fruitport Township;
Chesapeake Landing in Muskegon Township; Edison Landing
in the Muskegon Lakeshore SmartZone in downtown Muskegon;
and an unnamed Allendale residential-commercial effort.
The Muskegon area is an untapped opportunity, Gillespie
told The Chronicle. Muskegon is much like other communities,
such as Jackson and Adrian, in which Gillespie has flourished,
he said.
"Some might think that Jackson is the armpit of
the world," Gillespie said. "I say, good.
Stay the heck out. I have had a lot of success going
into towns others are not going into."
If Muskegon suffers from past image problems, that doesn't
bother Gillespie. He said he likes what he has found
along the Lake Michigan shoreline.
"Muskegon's turn-around is coming," Gillespie
said. "There is a huge upswing coming. There is
good momentum."
Gillespie points to the Harvey Street corridor with
The Lakes Mall and Lakeshore Marketplace as just one
potential source of tenants. He estimates that as the
corridor develops, there may be 2 million square feet
of new retail space.
That space creates jobs, and workers like to live conveniently
near their workplace, he said. Thus, the first Gillespie
complex in Muskegon was on Grand Haven Road a mile from
the new commercial area and the next will be directly
south of The Lakes Mall.
"Usually (residential) rooftops come first before
retail, but in this case the retail is driving the need
for apartments," he said. "And that will support
more retail."
It appears that Gillespie has always been aggressive
in business since his high school days at Lansing Catholic
Central when he partnered "50-50" with his
parents to purchase a starter house in downtown Lansing.
The young Gillespie fixed it up and rented it out, eventually
living in it when he attended Michigan State University,
where he received a degree in building construction
management.
Out of college, he went to work for Wickens Builders
and learned the ropes in apartment, hotel and office
complex construction and development. By 1994, it was
time to strike out on his own.
Gillespie Development was founded to develop, construct
and manage upscale residential apartment complexes.
His first was Autumn Ridge, a 48-unit complex in Adrian
adjacent to Sienna Heights College. Gillespie Development
still owns and manages Autumn Ridge.
The company grew with more developments in central Lower
Michigan from Delta Township outside of Lansing to Jackson,
Portland, Charlotte, Ionia and Brighton. Through Summit
Property Management, Gillespie continues to own and
manage the portfolio that has a 97 percent average occupancy,
he said.
Gillespie Development has about 20 staffers in East
Lansing that handle accounting, estimating, bidding,
construction management, financing and marketing functions.
The group continues to study growth patterns, traffic
counts, competitors and land prices for potential locations.
The key team members are Rachel Michaud, who handles
finance and operations for the development company,
and Gillespie's younger brother, Scott, who handles
the construction management end of the business. Summit
Properties has approximately 40 employees headed by
Dawn Lawless, director of property management.
As is commonplace with real estate development, a limited
liability company is formed for each project, with various
partners that change depending on the development.
Gillespie finances its construction through traditional
sources, such as Fifth Third Bank for the Hamptons and
Comerica Bank for Catalina Shores. All of the West Michigan
projects exclusively will have family members in the
partnerships, Gillespie said.
Gillespie has married into the Eyde family of Lansing
- five brothers who have been and continue to be major
builders and developers of residential, office, convention
and retail complexes in Michigan. The Eydes were Lebanese
immigrants and are related to the Muskegon Farhat family.
"Pat Gillespie brings a solid background in development
to Muskegon," said local attorney Chris Kelley,
who is leading the partnership that is developing the
Muskegon SmartZone now called Edison Landing.
Besides a relationship with Kelley and the Lakefront
Development LLC, Gillespie has forged another partnership
with Jeff and Dave Jacobs of Jacobs Property Investments
LLC. The Jacobs have been developing Golf View Condominiums
in Fruitport Township adjacent to Gillespie's planned
Catalina Shores apartments.
The Jacobs may develop more condominiums in Muskegon
Township in conjunction with the Chesapeake Landing
complex, Gillespie said. The formula for Gillespie's
rise in the world of Michigan real estate development
is to keep construction affordable, present a creative
product and serve the tenants once they are built, he
said.
The initial Gillespie apartment complexes featured clothes
washers and dryers in every unit, patios and decks,
ceiling fans in great rooms, two bathrooms in every
multibedroom unit, private carports, vaulted ceilings
in second floor units and master suites.
Gillespie apartments usually rent on the higher end
in any given market: one bedrooms from $575-$615, two-bedrooms
from $675-750 and three-bedrooms from $780-$850. The
units are market driven with no government subsidies
or restrictions.
"We provide a good bang for your buck," Gillespie
said. "The key is serving the tenants. We have
found what they want and given them reason not to leave."
Several of the Gillespie developments have included
separate office or retail space, providing services
and conveniences to tenants. The new Gillespie complexes
are breaking out of the company's mold a bit with a
"community" emphasis at Catalina Shores in
Fruitport Township. Plans call for a clubhouse pool,
fitness center and business center. The downtown Edison
Landing project will step out of the box a bit further
with a blending of residential and retail/office space.
The new designs and concepts are coming from an alliance
with Fugleberg Koch Architects of Winter Park, Fla.
Gillespie said he met Bob Koch at an Orlando meeting
of the multifamily residential development industry.
After meeting Koch, the company's search for a new architect
ended, Gillespie said. Koch is the principal in an architectural
firm that has a development arm call Group One Productions
- the development company that had proposed a casino
for downtown Muskegon and now has joined forces with
the Archimedes Group of Muskegon to propose an entertainment-based
development for the former Muskegon Mall property.
"They are not just architects," Gillespie
said of Fugleberg-Koch. "They understand costs
but provide some creative and unique plans. They have
given us some top-notch work product."
FAXBOX: The Gillespie Development file West Michigan
projects of the East Lansing apartment developer and
manager:
The Hamptons of Norton Shores. Nearly complete 104 unit,
one-, two- and three-bedroom apartment complex on Grand
Haven Road at Farr Road.
Catalina Shores. A proposed 344-unit "full-service,
high-end" apartment complex in Fruitport Township
at Mount Garfield Road and Harvey Street south of the
Lakes Mall. Construction could begin this winter and
be completed in the fall 2006.
Chesapeake Landing. A proposed 264-unit "full-service,
high-end" apartment complex in Muskegon Township
at Apple Avenue and Walker Road. Construction could
begin in the spring 2003 and be completed in the fall
2006.
Edison Landing. A proposed upscale 40-unit, loft-style
apartment development with 40,000-square-feet of retail/office
space in the Muskegon Lakeshore SmartZone Development
that is being developed on the former Teledyne site
on Muskegon Lake. Construction could begin in the fall
2003 depending on the building of the Shoreline Drive
extension by the city of Muskegon and be completed in
the spring 2005.
Unnamed Allendale development. A proposed 63-unit, loft-style
apartment complex and 47,900-square-feet of "boutique-style"
retail and office space in Allendale west of Grand Valley
State University on M-45. Construction could begin in
the fall 2003 with completion in the spring 2005.
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Printable Version |
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“On
August 11, 2001, we celebrated 50 years in Western Michigan.
You don’t do that without excellent relationships
with everybody.”
Mike Pepper,
General Manager
Howmet Corporation
an Alcoa Business |
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