March 21, 2005

By Tim Gwozdz
MiBiz Network

MUSKEGON — Muskegon Construction Co. President Gary Post PE has agreed to purchase three buildings on the former Muskegon Mall site. The three structures — the Century Club, the Daniel’s Building and the old Muskegon Savings Bank Building make up what is known as the Russell Block. This is the first piece of property on the 17-acre site to be sold.

Situated in the heart of downtown Muskegon, the former mall property is owned by Downtown Muskegon Development Corp., which is comprised of the Community Foundation of Muskegon, the Paul C. Johnson Foundation and the Muskegon Chamber of Commerce.

Community Foundation of Muskegon President Chris McGuigan said the announcement of this first purchase is only the beginning of the good news surrounding the site. She told MiBiz that confirmation of a second purchase agreement could just days or weeks away. “It would certainly be within a month,” she said.

The most serious developers are within the state and the region, added McGuigan. An offer is expected on the National City Building, which sits kitty-corner from the Muskegon Savings Bank and McGuigan remarked that negotiations also are underway with developers wanting to purchase vacant land to build residential units.

The Century Club, Daniels and Muskegon Saving Bank buildings will be owned by Western Avenue Properties LLC, of which Post has a controlling interest. Post told MiBiz the acquisition of the site and the projected renovation and restoration of the structures represents a $3.5-$4 million investment. Approximately 80 percent of that will be construction costs.

Development plans for all three properties are being formed. The Muskegon Savings Bank Building would be converted into two or three street level retail/office suites, the largest of which is being considered for a coffee shop or deli. The upper floor of the 44,000-square-foot building would most likely be turned into apartment space. Retail would fill the first two floors of the Daniels Building. The third floor would be ideal for several condominiums, stated Post.

“I’m toying with the idea of rebuilding the back section of Daniels so that the condos would have access to a rooftop garden.”

The Century Club would feature an entertainment component — either an upscale restaurant or a nightclub. McGuigan said Post’s plans for the buildings will create “the vibrancy that we need to build on for downtown.”

There is a lot of work to be done on the three structures and Post recognizes that there is a lot of risk involved, but he’s willing to take it. He said he is pleased to take the lead on the redevelopment of the downtown site.

“I believe that what it’s going to take is one or two people to step up and make this happen,” Post told MiBiz. “I just believe the time is right and downtown Muskegon is going to come back better than ever. It’s going to take a little effort, but it’s bound to happen.”

McGuigan said it is apropos that it is three of the five structures remaining on the property that were the first to be sold.

“I laud Gary for his intent to restore the buildings rather than tear them down,” said McGuigan. “His plans are consistent with the DMDC’s recommendations for buildings along Western Avenue.”

Muskegon Construction Co. and it parent, Grand Rapids-based Owen-Ames-Kimball Co., have shied away from property development, however, Post said Muskegon Construction will be involved in construction phase of the Western Avenue Properties project. He also is hopeful that Owen-Ames-Kimball will consider exploring the property development possibilities of the mall property as well.

“There are opportunities in Muskegon that can benefit the company and the community,” said Post. “I’m hopeful the company consider the site.”

Work continues on the engineering and surveying of the former mall property while the DMDC nails down the government funding that is needed to add streets and install the proper infrastructure. Once the infrastructure is in place, Post said he would move quickly on renovation, restoration and leasing his three buildings.

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This article appeared in the March 21, 2005 issue of MiBiz, read by upper management executives in West and Southwest Michigan. Print subscriptions are free to qualified individuals who do business in West and Southwest Michigan. For further information about MiBiz Network, visit www.mibiz.com.