Proposed senior housing facility moves to Kelly’s Corner

Published 9:28 am Wednesday, August 24, 2016

A Wisconsin-based private real estate company still plans on building an independent senior housing facility in downtown Niles — just in a different location.

In June, General Capital Group proposed constructing the facility at the site of the Cowboy Saloon on Second Street, but has since changed the location to 211 Broadway St. — the area commonly referred to as Kelly’s Corner.

Josh Hafron, vice president of General Capital Group, said his company believes Broadway Street is a better fit.

“We felt this location was a better location with more visibility,” said Hafron after Monday’s meeting of the Niles City Council.

City Manager Ric Huff said the company changed locations because it could not come to a purchase agreement with the owner of the Cowboy Saloon.

The plan for the estimated $10 million housing facility remains largely unchanged, Hafron said, with 53 units available to low-income seniors, including 35 one-bedroom and 18 two-bedroom units. There will also be a parking garage located beneath the facility with 45 spaces available for tenants.

Hafron said he believes there is a demand for this type of housing.

“We are doing a market study to prove that there is,” he said, “but with the aging population and not a lot being built in Niles the last five to 10 years there is probably an untapped demand for senior housing.”

Although General Capital Group has a purchase agreement for the property, Hafron said it is contingent upon several things happening, including:

• Receiving site approval from the city

• Receiving zoning approval from the city

• Receiving a payment in lieu of taxes (PILOT), or tax exemption, agreement from the city

• Receiving a letter of support from the city

• Receiving financing from the Michigan State Housing Development Authority

If everything goes through, Hafron said the company could begin construction in 2017 and begin leasing units in 2018.

“We will know in January whether or not we will get MSHDA financing,” he said.

If General Capital Group does not receive state financing, Hafron said the company would likely reapply for the funding.

The city’s attorney provided a first reading of an ordinance that would establish the PILOT at Monday’s council meeting. Huff said a second reading is necessary before it can be approved.

The PILOT essentially would allow General Capital Group to forego paying property taxes on the property for the next 30 years in exchange for paying the city an annual service charge of $10,000 or 6 percent of the annual rents collected, whichever amount is greater.

Huff said General Capital Group would not be able to obtain MSHDA funding without the city approving the PILOT.

The council did not discuss the senior housing project or the PILOT during Monday’s meeting.