LINKEDINCOMMENTMORE

Seventeen months after the Fisher and Albert Kahn buildings were sold in a $12.2 million deal, owners of the New Center properties say they plan to invest up to an estimated $100 million to revive the architectural jewels.

The building owners are in talks with a national home furnishing store to become the anchor tenant in the Albert Kahn building. The unidentified retailer could take up to 30,000 square feet in the space where a Saks Fifth Avenue store operated for years, until it closed in 1980.

In addition, the space from floors 3-11 of the Kahn building will be converted into 162 rental apartments. The existing Albert Kahn Associates architecture firm would remain in the building named after its famed founder.

Already the Fisher Building is getting infrastructure upgrades and maintenance both inside and on the exterior. The West Grand Boulevard skyscraper has National Historic Landmark status, the highest level of recognition of a building’s importance in the United States.

On Thursday evening, an artistic and cultural programing effort at the Fisher called The Beacon debuts. It will be based in the building’s “arcade” — essentially the building’s opulent lobby. The first program will be a series of photographic portraits, with accompanying narratives, of local “makers” — artists, community organizers, etc. The portraits will be in the large display cases that line the Fisher Theatre.

“Someone described the overall plans for the area as turning New Center from the end of downtown to the beginning of downtown,” said Dietrich Knoer, who co-owns both the Fisher and Kahn buildings with Peter Cummings.

Knoer and Cummings were part of the group of investors that bought the buildings in an online auction in June 2015, along with a nearby Baltimore Street parking garage with 2,061 spaces, for a total of $12.2 million. In 2001, the Fisher and Kahn buildings sold for $31 million. Cummings and Knoer are principals in a new firm called The Platform.

The two buildings could each get an infusion of $50 million in investments, the owners say, with the parking lot likely to get an estimated of $6.5 million in upgrades. The money will come from private financing, though the buildings could be eligible to receive some tax credits.

Cummings is the son-in-law of the late Detroit businessman and philanthropist Max Fisher. He was active in Detroit investment, then focused on working in Florida before returning to the Motor City. One site he developed along Woodward in Midtown is now home to Detroit’s Whole Foods grocery store. Earlier, Cummings developed Orchestra Place also on Woodward, as well as the Ellington residential project, a parking garage and townhomes near Wayne State University.

James Bieri, a development expert and principal of Southfield-based Stokas Bieri Real Estate, said the investment in the Fisher Building could be “a game changer” for the area.

“It was sort of just hanging on,” Bieri said. “With the M-1 Rail going back and forth, it will be good to have an anchor in New Center. Any time you can put people on the street at different hours of the day, it brings vitality to the area.”

Bieri said using a large portion of the building for residential development is smart, as the new development won’t leach office tenants from surrounding buildings. The apartments will be filled with new people instead of people already living somewhere downtown, Bieri said.

Cummings admitted the neighborhood north of Wayne State University has struggled to find its niche since General Motors moved its headquarters downtown 20 years ago. But lately, various investors have purchased empty storefronts and run-down apartment buildings in the neighborhood. Many believe the area will see new life as housing demand outgrows Midtown, downtown and Corktown and moves north along Woodward.

Daren Blomquist, a California-based housing expert, said work on the Fisher and Albert Kahn buildings would be a catalyst for other development in the area.

“We’ve seen booming downtowns ripple out to surrounding neighborhood housing markets in other cities such as Denver and Portland because the younger generation workers flocking to those areas for jobs are more interested than previous generations in living and playing close to where they work,” he said.

The upcoming QLine light-rail trolley is another factor behind the increasing level of investment. Within 10 years, its supporters contend, the QLine will drive $3 billion in development and 10,000 housing units, filling the yawning gaps of dead buildings and empty lots along Woodward, Detroit’s most storied street.

Last year, the influential Midtown Detroit Inc. bought 11 New Center properties, mainly vacant storefronts, near the corner of Woodward and West Grand Boulevard. The nonprofit development agency is among those aiming to spend millions in New Center. In addition, Henry Ford Hospital aims to build a $110 million outpatient cancer center in the area, and the nearby Motown Museum recently announced plans to expand its space.

The Kahn building is now only 30 percent occupied. Late next year, work is expected to begin to convert the floors of offices into residential space. Knoer says they have the potential anchor store identified and are in “very good discussions” with the retailer to take up half of the 60,000-square-feet of retail space.

“It’s a little too early to announce,” the potential anchor, Knoer said. “We only do that when we have the lease signed.”

The conversion of office space into apartments should begin mid-2017 or later.

Cummings said the retailer is in “home furnishing, art, craft, design.” The amount of space that can be offered at the Kahn — compared with downtown and Midtown — is more appealing to large retailers, he added.

As for the Fisher, the emphasis is about getting more retailers — including restaurants — and giving people a reason to view the building as a gathering place beyond the Fisher Theatre.

“It’s really about programming, polishing and leasing,” Cummings said.

Cummings and Knoer aim to build 1,000 new residential units and up to 150,000 square feet of retail in the area. Last month, the pair formally debuted Third and Grand, a six-story, 231-unit apartment complex at the northwest corner of Third and West Grand Boulevard. The new complex is expected to open in spring 2018.

“We bring very much a neighborhood perspective to literally everything we do,” Cummings said. “There are solutions to problems that can impact way beyond the four corners of the building. I would call that a home run in the real estate business

“We have that opportunity with these buildings,” he said.

Detroit News Staff Writer Ian Thibodeau contributed.

LINKEDINCOMMENTMORE
Read or Share this story: http://detne.ws/2fUeyzl