Knapp’s wakes up

Sleek Lansing landmark will come back to life

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(For an interview with Bob Johnson, director of theLansing Planning and Neighborhood Development Department on this week’s “CityPulse on the Air” radio show, , click here or go www.lansingcitypulse.com.)

The Knapp’s building, Lansing’s most spectacular butconspicuously vacant downtown landmark, will be restored to its 1930s Art Decoglory for a new life as a high-end retail, office and residential complex, cityofficials and developers announced Tuesday.

Knapp’s Center owners George and Louis Eyde will move theirEast Lansing development company into the finished building, which will alsohouse a small business incubator run by the Lansing Economic Development Co. Thosetwo entities will occupy about 15 percent of the building’s 190,000 squarefeet, Bob Johnson, director of the Lansing Planning and NeighborhoodDevelopment Department, said.

“This is one for the history books,” Lansing Mayor VirgBernero said. “I’m grateful that the Eydes had the vision and the commitmentfor it.”

The Eydes plan retail space on the first floor, office spacefor the middle three floors and 19 residential rental units on the fifth floor,with 40 spaces of underground parking.

A complex package of federal, state and local loans, grantsand tax credits will finance the project, which is estimated to cost upwards of$20 million. Mark Clouse, spokesman for the Eydes, said the Eydes would put$9.2 million into the project, up front and through loan obligations. Work onthe building is expected to begin in spring 2011, with doors opening in 2013.

“Next to the state Capitol and the Ottawa Power Station, theKnapp’s Center is probably the city’s most iconic, significant building,”Bernero said at Tuesday’s announcement.

The yellow and blue Streamline Moderne structure housedLansing’s leading department store from 1937 until the store closed on anunlucky Oct. 13, 1980. It was used for office space until 2002.

Bernero said the project would return Knapp’s to its bygonestatus as a symbol of thriving downtown commerce.

The National Register of Historic Places lists Knapp’s as “alandmark in the progress of the modern movement in architecture in Michigan.”

Lis Knibbe, preservation expert for Ann Arbor’s Quinn Evansand head architect, sounded almost jealous.

“The coolest Art Deco building we have [in Ann Arbor] is thebus station,” Knibbe said. “We don’t have anything like the Knapp’s building.”

A bullet-sleek look, on a Queen Mary scale, is what makesKnapp’s unique. The building’s shiny skin is made of Maul Macotta, or concreteblocks faced with ceramic and metal. “Metal panel systems like the one used inKnapp’s can be seen in storefronts, gas stations and bus stations across thenation, but not in huge buildings like Knapp’s,” Knibbe said. “It’s very largefor an Art Deco building.”

But Knapp’s has been idle, like a beached ocean liner, sincestate offices moved out in 2002.

In a phone interview Monday, an elated Bernero said theproject is crucial to the city’s future “on so many levels.”

“There’s the sentimental longing to see it, the economicrevitalization, and the boost to the spirit it will be for downtown,” he said.“This huge, hulking structure and beautiful Art Deco design will be preserved.”

The Knapp’s building is only a few blocks away from anothercrown jewel of downtown architecture, the1939 Ottawa Power Station, nowundergoing its own epic $130 million redevelopment. The same architect, Orlie Munson,designed both buildings.

Several people involved in the Knapp’s deal said the Ottawaplant’s redevelopment into the world headquarters of the Accident FundInsurance Co. was a catalyst.

Clouse said the Ottawa project set a precedent for usingpublic-private partnerships to save an iconic downtown structure.

“It’s being done, and done well, and demonstrated that thereare no buildings that can’t be saved,” Clouse said.

As makeovers go, the Knapp’s project is less drastic thanOttawa’s leap from power station to offices, but time was a complicatingfactor. Although Knapp’s is structurally sound, the clock is ticking on thebuilding because of a fatal flaw in its multicolored skin.

Used in thousands of 1950s gas stations and diners, the MaulMacotta facing was cutting edge in 1937 — perhaps too cutting edge.

“They didn’t have all the kinks worked out of it,” Knibbesaid. At Knapp’s, the joints between the metal panels were covered with asimple metal reglet, or molding, that let snow and rain get into the concretebehind the metal.

Later attempts to caulk up the joints made matters worse bytrapping moisture inside the walls.

“There are places where it’s crumbling and places where it’sstill fine,” Knibbe said. Clouse said part of one wall is so crumbly it had tobe shored up.

The redevelopment will use a modern rain screen system thatlets water circulate in and out of the wall. It’s not a matter of replacing aplate here and there. Knibbe called it “a substantial rebuild of the skin.”

The new facing will either be concrete or aninsulation-backed metal panel. The design team may go back to ceramics or useautomotive paints to re-create the building’s vivid colors.

The plan to restore the iconic skin was essential tosecuring $7.3 million in federal and state historic tax credits, and lays torest longstanding fears that the Eydes would just give up and flay thebuilding.

Eight years ago, Knibbe did a study of the Knapp’s buildingfor the city and state historic preservation offices. “Back then, [the Eydes]weren’t ready,” she said. “Now they’re clearly ready. Seeing their change ofattitude was clearly key.”

“I can’t put my finger on any one thing that made thechange,” Clouse said Monday. “It was a combination of factors.”

Clouse said Eyde reps have talked with the city “for years”about redeveloping Knapp’s, but the scale of the 190,000-square-foot buildingmade small tenants untenable. A major capital investment and overall concept,all or nothing, was the only way to go.

Over the past few years, Clouse got positive signals aboutthe Knapp’s building from the state’s historic commission and Lansing’s EDC.

Johnson certainly had a soft spot for Knapp’s. “When I movedhere from Massachusetts in 1974, I was buying popcorn, getting school clothes,riding the escalators,” Johnson said. “It was the coolest building.”

Karl Dorshimer, vice president of the Lansing EDC, said hespent many summer days looking at the gleaming Knapp’s façade while eatinglunch on Washington Square.

“It just looms over downtown,” Dorshimer said. “I’d think,‘Jeez, we gotta do something.’”

At Tuesday’s announcement, Dorshimer said he got in troublefor going up the down escalator and vice versa on his way to Knapp’s toydepartment.

Now he’s got a toy that takes up most of a city block. In winter2009, after a year of dramatic progress on the Ottawa development, Johnson helda meeting in his office with Dorshimer, Nick Eyde and a financial consultantfrom California.

At the meeting, Nick Eyde floated the idea of getting aSection 108 loan from the federal department of Housing and Urban Developmentto push Knapp’s over the hump.

The Eydes would have to pay back the $5.4 million, but theloan would be secured by Lansing’s Community Development Block Grant funds.

As the others listened in, Johnson called Washington to askif the project would qualify.

“They had some HUD official explain it to us,” Johnson said.“We talked about the location, job creation. All these things seemed to fallinto place. It was sort of an ‘aha’ moment.”

Among other qualifications, Section 108 projects must havethe potential to create jobs and revitalize crucial urban areas. The Knapp’sproject, when finished, is expected to bring 200 to 300 new jobs to downtownLansing.

“After we explained the Knapp’s Center to them, they said itwas an ideal candidate,” Clouse said.

The $5.4 million Section 108 loan opened the door to afederal grant called BEDI, or Brownfields Economic Development Initiative (notto be confused with Brownfield Michigan Business Tax Credits). If the Section108 loan meets final approval, the BEDI grant will toss another $2 million intothe pot.

“They go hand in hand,” Clouse said.

Johnson said the $2 million BEDI will be put in reserve tohelp secure the Section 108 loan, lessening the risk to Lansing’s CommunityDevelopment Block Grant.

The Knapp’s-sack of financial incentives also includes $7.3million in state and federal historic tax credits, $4.8 million in federal “newmarket” tax credits, $1.8 million in Brownfield Michigan business tax credits,and a Renaissance Zone designation, under which state and local property taxesare waived for 12 years, then phased back in over the remaining three years.

Clouse said the federal and state credits can be sold tobuild up the capital needed to get the project underway.

Two tenants are already in place: the Eyde headquarters anda 10,000-square-foot small-business incubator run by the Lansing EconomicDevelopment Co., similar to the Technology and Innovation center in EastLansing.

Dorshimer said the incubator would take on businesses with apotential for growth, without regard to type. He said the space will lenditself to retail, high-tech startups and even galleries.

“It’s an ideal building,” he said. “It really inspirespeople.”

Johnson acknowledged that there is already vacant commercialspace in downtown Lansing, but said the office space at Knapp’s would be “ClassA” (state-of-the-art design, high-quality materials, prime location), and hencemore in demand.

A spokesman for the project said the Eydes are talking topotential restaurant tenants.

“This space just screams ‘restaurant,’” Knibbe said atTuesday’s announcement, gesturing toward the building’s airy northeast corner.

In contrast to the epidermal issues, Knibbe called thebuilding’s interior “quite clean.”

“It’s a very good canvas for doing new things to,” Knibbesaid.

Although layers of prismatic glass bricks funnel light intothe building, much like lighthouse mirrors, Knibbe said the building is still“internally focused.”

To lighten and brighten the interior, the renovation willfeature a four-story glass atrium from the second through the top floor, with askylight.

Knibbe said the project will aim for a LEED (Leadership inEnergy and Environmental Design) silver certification.

“It’s going to be an energy efficient, healthy building towork in,” Knibbe said. “It will be this state of the art office building withina historic envelope.”

At Tuesday’s announcement, Bernero praised the finance anddesign team.

“This could have gone otherwise,” he said. “We could havelost the building.”

“Economically, [demolition] was one of the options we lookedat,” Clouse said. “But we all had an appreciation for the building, and thegovernment has made it feasible for us to do this.”

Knibbe said the state and federal historic preservation taxcredits did their job. “If you use those fundings, you have to go historic,”she said. “You can’t change the façade.”

Bernero said the Eydes’ decision to move its headquarters tothe Knapp’s building was the turning point.

“When they are willing to move their family business backdowntown, and make the investment work, that made me believe we were going toget this done,” he said.

Taking the longer view, Knibbe sees the Knapp’s project asanother step in the ongoing reversal of automobile-focused urban growthpatterns. “The younger generation is more interested in the diverse lifestyleyou can have in an urban setting,” she said. “And the buildings are justsitting there waiting.”

At Tuesday’s press conference, Bernero said financialincentives only go so far. “Karl [Dorshimer] gave you the cold hard numbers,”he said. “But this is a labor of love and a leap of faith.”

For now, most of the building’s equity is wrapped up inbeauty and nostalgia, but these quantities have real value. 73 years from now,it’s hard to imagine anyone moving financial mountains to restore the MeridianMall or Eastwood Towne Center to its original form.

“We have gone through a period of great plenty, wherethrowaway buildings were acceptable,” Knibbe said.

“This pre-World-War-II stuff’s built to last.”



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