3 new Detroit residential buildings will have high, low rent mix

JC Reindl | Detroit Free Press

The city of Detroit announced plans Thursday for three new residential buildings containing 367 apartments or condos in the once-desolate Brush Park neighborhood that will offer an aggressive mix of market-rate and more affordable rents.

The projects, totaling $102 million in costs, will be headed by private developers on large vacant lots that were once owned by the city. All three are to begin construction next year and be done by late 2021.

"This is part of a broader plan," Detroit Mayor Mike Duggan said. "We're not having a city where wealthy people live in one area, and people with lower incomes live in another area. We really do believe in one Detroit, for all of us. This neighborhood is going to have first-class housing and a range of incomes."

The developers are expected to receive various financial incentives and subsidies for setting aside portions of their buildings for tenants who would pay below-market-rate rents.

The amount of those incentives is still to be determined, but they will be more generous for developers willing to reserve more apartments for lower rents.

"If folks want to come in here and build market-rate apartments, they could, but they will get no support from the city — no tax breaks, no federal money or anything else," Duggan said. "If you want any support from the city, you have to set aside permanently subsidized apartments for people of lower income. And the more units you set side and the lower that income is, the more subsidy we will provide you."

The lower rents will be offered to people who earn at least 80 percent less than the Area Median Income for the Detroit-Warren-Livonia geographic area, which comes out to $48,000 for a single person. That area median system and geography is used by the U.S. Department of Housing and Urban Development.

For instance, one project would set aside 45 apartments with special rents for those making 30 percent to 60 percent of the area median income.

The developers did not say how much rent they anticipate charging.

However, the maximum rent allowable by HUD for a one-bedroom apartment for a single person making 30 percent of the Detroit area's median income is $400 per month. For those making 60 percent, the max is $800 and for those making 80 percent, it is $1,065 per month.

The three newly announced buildings:

1. Brush + Watson

Total units: 180

Affordable units: 90 units, 45 to be set aside at 80 percent area median income; 45 more at 30 percent to 60 percent of area median income.

Commercial space: 8,500 square feet

Total cost: $45 million

Developer: American Community Developers

2. Brush House

Total units: 179

Affordable units: 37, set aside at 80 percent of area median income.

Commercial space: 15,660 square feet

Total cost: $52 million

Developer: City Growth Partners

3. Brush 8

Total units: 8 luxury condos

Affordable units: Zero

Total cost: $5 million

Developer: City Growth Partners

Brush Park was long ago home to Detroit's wealthiest residents and their dozens of large Victorian mansions, but many of those properties fell into disrepair and were bulldozed as the city's fortunes plummeted.

More: Big buildings planned for Detroit's once-desolate Brush Park

More: BBG moves into former Heidelberg Project offices in Brush Park

More recently, the neighborhood has seen a flurry of building activity as developers construct new townhouses, apartments and condos on the once-vacant lots. The Bedrock real estate firm belonging to Detroit businessman Dan Gilbert was the first to undertake large-scale projects, notably the 410-unit City Modern.

Longtime neighborhood resident Mona Ross, also a member of the Brush Park Community Development Corp., applauded the newest trio of projects at Thursday's announcement event, which was held on the empty grassy lot of the future Brush House project.

“This neighborhood is developing so rapidly it’s almost scary to me," she said. "I’m just so thankful I get a chance to see it in my lifetime, because being here so long, it had really went down.”

Contact JC Reindl: 313-222-6631 or jcreindl@freepress.com. Follow him on Twitter @JCReindl.