The good, the bad, the up and coming

Dozens of construction workers in fluorescent green jackets are heading toward their cars, filtering out from a massive, $182 million construction project that towers over the neighborhood. The workday is over.

There’s a lot of promise these days for the area bounded by Malcolm X Street to the north, Mt. Hope Avenue to the south, Cedar Street to the east and Townsend Street to the west, known as REO Town. There are also signs of urban decay, which could fairly characterize REO Town’s life since the 1980s.

While momentum has been building for several years, much of today’s hope is pinned on the daily influx of a few hundred people.  They will be here as part of the Lansing Board of Water and Light’s new $182 million headquarters and cogeneration power plant in the heart of REO Town. The plant is set to be operational in July, with the offices to open in the fall. The public utility is also restoring the historic Grand Trunk Western Railroad Depot adjacent to the site (see page 10).

The major investment may be the start of returning REO Town to its glory days when Ransom E. Olds (whom the area’s named after) started producing cars here in the early 1900s.

On Monday, Mayor Virg Bernero will be in the old train depot to deliver his eighth State of the City address. And perhaps more than anywhere else in Lansing — downtown, Old Town and the north, south, east and west sides — REO Town is a symbol of the city’s progress. Major redevelopment is happening across the street from boarded-up storefronts. High-end apartments neighbor crumbling housing stock. Businesses are eager to move into renovated storefronts as a long-time anchor business owner is trying to get out. Art and craft beer festivals occur in the late summer and winter months while an innovative food project fizzled out a few years ago. The yin and yang of Lansing is captured in REO Town.

Ryan Wert, who has lived on Elm Street for eight years and owns a recording studio nearby, says in his eight years here, REO Town’s resurgence has gained steam, from “wishful thinking” to “concrete things in motion.” Wert, 30, also serves on the REO Town Commercial Association.

“Many of the same struggles from before are struggles now: A commercial corridor not occupied, buildings burning down, empty lots. But there’s also a lot more coming,” Wert said. “The last two to three years have seen a really good group of committed people who I think really believe in the area and want to see what it can be. That’s been a huge impact on just the outlook and morale of the business community. Now it’s like people get together and are looking toward the future.”

Coming

The nine REO Town business owners, residents, public officials, developers and visitors interviewed for this story placed more emphasis on the renovations and new construction in REO Town than the vacancies.

Local developers Alan Hooper and Tom Arnold are redeveloping properties on the 1100 block of South Washington Avenue, dividing the buildings for multiple uses.

In the former Michigan Electrical Supply building at 1118 S. Washington, Arnold is turning the three-story building into an upscale residential apartment, offices for the Great Lakes Capital Fund and the Community Economic Development Association of Michigan and first-floor restaurant space. It’s been three years since the Lansing City Council approved tax incentives for the property. The owners behind Fork in the Road, a gourmet food truck that opened a restaurant on Lansing’s west side, plan to open a gastro pub in Arnold’s space in 2014. The nonprofit tenants, whom Arnold credited for helping his redevelopment along, plan to be moved in by April 1. The 25,000-square-foot building was virtually gutted down to the exterior walls, flooring and roof, Arnold said.

When Arnold bought the property five years ago, “You’d think (a resurgence) was going to happen and then the economy started sputtering. It didn’t really go anywhere for a while. Now you’re starting to see some really positive changes,” Arnold said, referring to BWL as well as the two nonprofits about to move into his building. “We just hope it will continue.”

Jesse Hahn, a co-owner of Fork in the Road, called REO Town “kind of that new frontier” of Lansing — and with easy access to Interstate 496, close proximity to downtown and a relatively quiet food scene, moving there is an easy choice.

“We’re trying to get there before other people get there,” he said. “It seems like a good area to be.”

Hahn said it’s undecided whether Fork in the Road will add the gastro pub location — with a focus on Michigan craft beer and wine and locally sourced food — under a different name or if it will relocate the west Lansing business. He hopes the REO Town location will be open by late 2014 as the building’s redevelopment finishes.

“People have been talking to us about possibly moving to East Lansing or Okemos,” Hahn said last week. “But we’re Lansing folks. It’s where we want to be, and it’s the demographic we’re going after.”

Meanwhile, Hooper is more guarded about plans for his building at 1146 S. Washington. Hooper sought the site, formerly Ramon’s Mexican restaurant, from the Ingham County Land Bank before he knew of BWL’s plans. He closed on the site in April 2011 for $160,000, according to property records. 

“I really wasn’t expecting the level of investment and redevelopment that the city and the Board of Water and Light have made down there,” he said. “It’s been awesome. If you step back and kind of squint and look into the future about a year, it’s going to be a really nice little area down there.”

Construction on the building, which he says will likely house two or three tenants, will ramp up in the spring after it was delayed this summer during Washington Avenue construction. While he said potential leasers have expressed interest in the site, he declined to share who they are.

Hooper and Arnold aren’t alone. At 1135 S. Washington, Paul Trowbridge opened Cuttin Up barbershop in November. Trowbridge is a former owner of Barber Love on Lansing’s Eastside. At 1107 S. Washington, a Famous Taco opened late last year. The REO Town Pub is rebranding itself to offer more Michigan craft beer to target a new demographic.

Roxanne Nye, who owns REO Town Pub at 1145 S. Washington and also lives above it, is helping coordinate Art & Craft BeerFest on Feb. 2 in REO Town. Taking place in Arnold’s building at 1118 S. Washington, the event will pair Michigan artists with craft beer from their hometowns, Nye said.

“It’s about helping people discover REO Town. It’s us saying, ‘Look, we’re on our way back,’” she said. “It’s to help people realize we’ve weathered the storm, basically.”

(Unfortunately for Nye, the bar had been robbed of several bottles of liquor the night before I stopped in — the first such incident in the 10 years she’s been there, she said.)

And going

Across the street from Arnold’s and Hooper’s projects, though, is a businessman looking to get out of Dodge. “Discount” Dave Sheets owns two furniture stores on Washington Avenue totaling 50,000 square feet, as well as a vacant lot that resulted from a fire nearly four years ago. Sheets put his “heart, soul and life savings” into opening the failed Cadillac Club eight years ago at 1121 S. Washington in an old bowling alley and “thought that would be the catalyst to get things going down here. I was dead wrong on that. … Now this new BWL plant hopefully is going to be the catalyst and makes the difference.”

Sheets says he’s ready to get out of the furniture business and move on to fixing up houses and renting them throughout the city.

“I would love to find a buyer for any of these buildings,” Sheets said.

At the Famous Taco location, which used to be Dalmatians Firehouse Grille — a diner once frequented by local police and firefighters — and then the Southern Grille, local developer Pat Gillespie had plans for a small restaurant concept as part of the REO Eats Project. Architectural renderings and a social media blitz for public input on the restaurant’s concept surfaced at the end of 2010. From there, the project fizzled out, said Wert of the commercial association. He said Gillespie had trouble finding someone to manage the day-to-day operations of a restaurant.

“They sort of got it through the idea phase. He hoped to put the project together and pass it off to someone,” he said. “I think when the new captain never emerged, that idea kind of died out, unfortunately.”

Gillespie could not be reached for comment.

Also, Wert said some REO Town businesses were negatively impacted this summer when the city started its streetscaping plan, which widened Washington Avenue sidewalks and reduced the number of lanes from four to two. Some business owners are concerned about the reduced number of on-street parking spaces, which Nye estimated decreased by one-third. The timing of the city’s project with that of BWL’s infrastructure work — separate, but timed coincidentally — was a sign for some businesses to take “an early retirement,” while others weren’t “so happy with the timing,” Wert said.

“In general I think people viewed it as the storm before the calm: It’s going to be bad, but it will be worth it in the end,” Wert said. “We’re all optimistic that come June or July things will be dramatically different on that block.”

And coming back?

To the north is a conspicuous vacant lot with large white letters greeting visitors to REO Town. The site was home to the Deluxe Inn, a hotel that slowly deteriorated into a seedy eyesore. The Ingham County Land Bank acquired the property through foreclosure and cleared it in September 2010. A local developer and Land Bank Chairman Eric Schertzing unveiled a $30 million mixed use “vision” for the site. At the time, Schertzing said it was nothing more than an idea without a dollar behind it.

He’s had “nibbles” at the property, “but not the level I’d like.” The plan is to send out a Request for Proposals to develop the site. “Whether that will attract anyone or not, I don’t know,” Schertzing said.

But many agree it’s prime property. As for changes in real estate prices, Schertzing couldn’t isolate REO Town from other areas of the city, except that when the BWL announced its plans, “The number of for-sale houses went down — a lot got picked up,” he said. “That tells you that at least the investor market place responded.

“I think the potential of REO Town is greater than it was two years ago,” said Schertzing, who is also Ingham County treasurer. “BWL isn’t just a magic bullet that’s going to transform the place, but certainly it’s going to transform the corridor.”