Welcome to the neighborhood

April 13, 2009
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Setting up shop in what can be termed a residential neighborhood isn’t a trend — at least not yet. But there are signs out there that moving an office to a tree-lined street fronting older, single-family houses just might become one.

Two trendsetters recently did just that when Lott3Metz Architecture and The Highland Group moved from two commercial locations and opened new offices late last year in the residential Cherry Hills neighborhood on the city’s southeast side.

The businesses bought a two-story 1950’s office building with 5,800 square feet, at 645 Cherry St. SE, and then renovated it for their respective uses. Lott3Metz is an award-winning urban architectural firm, while Highland is an award-winning ad agency. The purchase and historic restoration project cost them about $1 million and they split the tab.

Greg Metz, a principal with Ted Lott in Lott3Metz, admitted that locating a business in a residential neighborhood isn’t a trend, nor is it even fashionable right now. He did say, though, he felt it would become one after a few more stages occur. He said the first phase of that movement is already under way and is being fueled by another trend.

“There has been a trend to move back into the city, and we’ve seen that happen across the country in the last few years. And we’ve certainly seen that in Grand Rapids — people moving in and living in the city and living closer to the city. People tend to move to downtowns first in cities where neighborhoods aren’t fully established,” he said.

In Chicago and New York, for example, Metz said people moving to the city from elsewhere don’t move into downtown because the residential areas in those cities are clearly established. By that he means the neighborhoods are complete within themselves, with most necessary services, along with those not so necessary, available.

“That’s what draws people to places like Chicago and New York City. Rarely do you hear somebody say, ‘I’m moving right down to the Michigan Mile.’ They like to visit the Michigan Mile, but most don’t like to live in the Michigan Mile,” said Metz.

Metz said that here people have moved into downtown, which is the first stage. Now some quiet neighborhoods in Grand Rapids are getting more activity from the moves to downtown, or from moves made directly to the neighborhood in order to avoid downtown, and those areas are transitioning into the types of neighborhoods found in larger cities, which is the second stage.

That phase sets a third stage in motion, where businesses follow new residents into these transitioned neighborhoods — and suddenly there is a real, honest-to-goodness trend.

“So, as far as a trend, I think what we’re going to start seeing is larger companies are going to tend to want to be downtown, but smaller companies and businesses are going to tend to gravitate toward neighborhoods, now that the neighborhoods are starting to get established,” said Metz.

“They’re cheaper to work in. They have neighborhood amenities such as pharmacies, groceries, hardware stores, because these things have a harder time moving downtown where it’s more expensive. The neighborhoods tend to have more service-oriented businesses and small shops. You can buy local and support your local community, and that’s certainly a trend that is happening in the United States … and we’re starting to see that happen here in Grand Rapids.”

Metz said the city is about a year behind that national trend. He pointed to what is happening in the Cherry-Wealthy, Eastown, East Fulton and Stocking-Bridge areas as part of that trend, as well as Gaslight Village in East Grand Rapids. If his time projection is right, then his firm and Highland are about two years ahead of the trend happening locally.

Lott3Metz moved from downtown’s Heartside Business District into Cherry Hills, while Highland left a suburban commercial district in Cascade Township. Metz said leaving a commercial district hasn’t hurt his firm’s business.

“Ironically, I think it’s helped. You would hope that. But when you actually hear that, you say, ‘Great, good for us,’ which I think helped us to realize that we’re doing the right thing,” he said.

Scott Crowley, principal of The Highland Group, said he moved into the neighborhood because his lease was up at the Watermark Country Club and the firm’s financial position was good enough that it could afford to buy a building. At the same time, he said his company was interested in becoming more involved with a community on a daily basis.

“We struggled, I would say for over a year, to find the right place that could meet both of those criteria. We looked a lot in downtown Grand Rapids. We were actually going to buy a complex of small buildings off Lake Buena Vista, just north of Rockford. But that was too far away for us,” he said.

So Crowley got together with Metz and Lott and they found the Cherry Hills building.

“We love, love, love the new space. After we moved here, it’s almost like our people forgot about where we were at before, because they love the space and the community so much. Half of my company can walk to work now. It’s been a really easy transition into a really nice new space. I think everybody likes it. It’s been a nice story for us,” said Crowley.

The move has been good for Highland’s business too.

“I would say, by way of the public relations that we’ve gotten from moving into the space, it’s built a greater awareness for The Highland Group and what we do, and it’s really publicized the quality of work that we bring into the marketplace. So it’s been kind of a nice brand extension, if you will, to the work that we do,” he said.

So moving a company into a neighborhood like these two firms have done could mark the start of a new brand extension of the office market, especially if it’s a good business fit.

“Clients come to us for a reason and that’s because of our urban experience. So what we’re starting to hear from our clients is, they’re starting to look at these neighborhoods, as well. That’s when we started to realize that it’s not just us,” said Metz.

“We’re just indicative of an attitude that is starting to happen; people do want to be close to neighborhood centers.”

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