There’s potential market for some 400 new residential units in downtown Battle Creek in the near future — and about half of those who would fill them already live in the city, according to results of a study presented Thursday.
The report by Clinton, N.J.-based Zimmerman/Volk Associates found 375 to 455 new rental and for-sale market-rate units could be built or created over the next five years through reuse of existing space downtown and in its surrounding neighborhoods.
And while about 27 percent of the dwellers could come from outside the region, consultant Laurie Volk said there’s no need for a national campaign to attract new residents; about 56 percent of whom would live downtown already live in Battle Creek.
Volk said the market could allow for 75 to 91 new units each year, most of them apartments. There also is potential demand for between 260 and 315 affordable housing units during the five-year period.
About 55 percent of potential downtown residents would choose rental units.
The study found the annual income of potential renters downtown would allow them to pay rents ranging from $500 to $1,800. Buyers could afford condominiums between $100,000 and $275,000; townhouses between $155,000 and $200,000; and cottages and homes between $185,000 and $265,000.
- READ THE REPORT: 2015 target market analysis of downtown Battle Creek
Researchers used data from the U.S. Census and the Internal Revenue Service to make their projections. About 4,234 households were considered as the study area, which overall had lower incomes and lower housing values than the city as a whole.
“It’s not guesswork,” Volk said Thursday morning during a public presentation. “This is really the way in-migration and out-migration has been working over, let’s say the past 10 years here in Battle Creek and the county as a whole.”
Younger singles and couples make up 58 percent of the target market. Volk pointed to millennials’ desire to live in urban environments and walkable neighborhoods, and the tendency of young professional couples to rent or buy townhouses. Retirees and so-called empty-nesters, many of whom have large incomes and want to move into a smaller dwelling, make up the second largest portion of the target market at 22 percent.
Family households are the smallest share of the target market. Volk said even the “most devoted urbanist” is likely to leave an area if it means his or her child will go to a better school.
“Except for cities like Chicago or New York, family households don’t typically choose a downtown to live in,” she said. “However, they do choose to buy houses in the surrounding neighborhoods, depending on what the school situation is.”
Volk said the best approach for developing downtown housing would include options for different income levels.
“We have found time and time again taking a mixed-income approach is the most effective way to revitalize neighborhoods,” she said.
She also recommended mixed-use development on vacant property and converting buildings’ upper floors into residential space.
“It’s something that really should be a priority because that brings the downtown to life,” Volk said. “Many of the residential studies we’ve done have been in response to the retailers. They say, ‘We cannot survive on the nine-to-five market, we need people living here.’ “
The city embarked five years ago on a major downtown redevelopment project; the need for more residential options downtown has long been known by local economic developers.
But finding solutions remains a challenge. Other than the Battle Creek Tower’s luxury apartments, options are scarce. A plan to convert the abandoned Heritage Tower would create much-needed residential space, but construction has yet to start on the project despite being announced almost two years ago.
Volk said developers must grapple with high construction costs and low real estate values, while the area is suffering an aging housing stock. Neglected and vacant property also can hurt the perception of the area, she said, and financing challenges still linger from the economic downturn.
When residential options are developed downtown, it will need to be promoted, Volk said.
“It’s really important to emphasize that downtown is the heart of the city,” she said. “It’s the neighborhood that belongs to everybody.”
Battle Creek Unlimited Downtown Development Director Rob Peterson said he believed the area could absorb more units than projected by the study because it didn’t consider the potential of workers from major employers moving into town.
Those local companies have conducted their own internal studies and found their employees say they don’t live in Battle Creek because of a lack of updated housing stock, he said.
“What happens when we have the housing stock they want?” Peterson said during the presentation.
The study on downtown housing began in October and was paid in part by a state grant obtained by the Calhoun County Land Bank Authority. The land bank, the county treasurer and the city of Battle Creek contributed matching funds, along with the city of Albion. Researchers found downtown Albion has market potential of about 250 units over the next five to seven years.
Call Jennifer Bowman at 966-0589.