The development boom in Grand Rapids
If you live, work or have traveled through downtown Grand Rapids recently, you might have seen the construction cranes that dot the skyline. Much of the growth started 20 years ago with the construction of Van Andel Arena, and the city hasn’t stopped re-shaping itself since.
Yet, industry experts naturally wonder when the construction boom will end. Most say it is inevitable at some point — but is it?
Our firm's in-house research team is always keeping an eye on the trends and the developments taking shape in our community. Here are some thoughts on Grand Rapids’ development boom and what it could look like in the years to come.
Development evolves in downtown Grand Rapids
While elsewhere in the region we’ve seen construction costs being prohibitive to new construction because of a lack of skilled labor, the downtown area continues to boom.
It seems downtown Grand Rapids has more cranes in the air right now than ever before. Rockford Construction is busy reworking an entire block on Bridge Street, with plans to continue even after the Meijer grocery store-anchored development is complete. Rockford also is building 234 Market Ave. on the city’s south side, which will feature both apartments and office space.
Pioneer Construction has two cranes up in the bourgeoning Monroe North district, while Orion Construction has one project just to the north of them along the river. In the core, Orion recently wrapped up Venue Tower and Arena Place, and is building a new home for Warner Norcross & Judd as well as Chemical Bank, which will have an attached Hyatt Place hotel.
Other sites that will be seeing cranes soon include Studio Park, to be located just south of the Van Andel Arena, and 201 Market Ave. along the river, where the city recently chose a redevelopment proposal with which to move forward.
Demand for residential grows
A key driver for the downtown developments has been the increase in demand for residential. While some developers have pivoted away from apartment to hotel, the demand for downtown rentals is evident. We now have an apartment occupancy rate of approximately 96.5 percent, which is among the highest in the country.
In Grand Rapids, 29.9 percent of the population is between the ages of 22 and 39. This age cohort is continuing to rent more than previous generations, so we anticipate the demand for apartments is going to last longer and be stronger than most could have expected.
Add this to the fact the downtown office occupancy rate is hovering around 90 percent and the growing need for hotel rooms to accommodate big conferences and events like ArtPrize, and you start to get a picture of why there are so many cranes.
Will Grand Rapids continue to boom or will it start to bust?
While it’s hard to say what the Grand Rapids skyline will look like 10 to 15 years from now, we do know developers have shifted their strategies and are catering to the needs and wants of our thriving community. We have seen developers combine uses, and even begin to add green spaces and other amenities that were previously not much of a priority. With multiple uses, the building stays relevant and becomes a traffic driver all day long, not just during work hours.
Offering a place where you can work, live and play is what people have come to expect when looking for a place to live, and I do not see this changing anytime soon. This dynamic approach is what is fueling all the activity we are seeing, and what will keep it going into the future.
What a cool time to be a Grand Rapidian.