Developer will pay $1,000 to Froebel School in Muskegon if affordable housing plan gets approval

MUSKEGON, MI – The sale of the old Froebel School for $1,000 to a housing developer has been approved by the Muskegon City Commission.

The commission approved the sales agreement conditional on the developer obtaining the low-income housing tax credits (LITHC) necessary for the affordable housing project.

The school, located at 417 Jackson Street, has been vacant for 20 years. Before Samaritas came forward with a plan to reuse the historic structure, city officials were concerned it might be torn down.

“The low purchase price represents an opportunity to save the building for high-priority adaptive reuse while avoiding our current costs and potential future demolition expenses,” Muskegon Director of Development Services Jake Ekholm wrote in a memo to the commission.

Samaritas has expressed interest in developing affordable apartments in the 93-year-old building. Its plans rely on tax credits, a federal program that provides credits to housing developers in exchange for keeping rents low.

LIHTC’s competitive program provides bonus points for historic preservation, and Samaritas has expressed a willingness to do the extra work for those points, Ekholm previously told commissioners.

The purchase agreement requires Samaritas to apply for LIHTC in 2023 and, if not granted, in 2024.

The development proposal is one of many that have resulted from the city’s courtship of developers to address the city’s great need for housing.

A city-commissioned housing study released in April found that the city would need more than 3,000 additional housing units, including more than 1,600 rentals, over the next five years.

Related: Details of two more affordable housing projects in Muskegon have been announced

Muskegon Public Schools closed Froebel 20 years ago as a cost-saving measure amid declining enrollment. Froebel served as an elementary school and later as a special education facility.

The district sold the building in 2014 to a company that defaulted on property taxes, leading to the city taking possession of it in 2018 through foreclosure.

The “extensive” asbestos and other materials that need to be addressed as well as the “significant infrastructure” make demolishing the old school “extremely expensive,” Ekholm wrote in his memo to the commission.

Earlier, he pegged this cost at more than $1 million.

The nonprofit Samaritas proposes to redevelop the historic Spanish Mission-style building into 46 apartments. Units will be reserved for those earning between 30% and 80% of the area median income.

Plans call for two studio apartments, renting for up to $241 per month, 37 one-bedroom apartments with rents ranging from $244 to $860 depending on renters’ income, and seven two-bedroom apartments renting from $446 to just over $1,000 per month. .

Ten units will be reserved for members of the Little River Band of Ottawa Indians.

The school’s renovations will include a 400-seat auditorium, and plans call for services such as substance abuse treatment, some physical and mental health services, financial literacy and homeownership classes and youth theater activities.

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