MP1, the new ownership group for Thirty-Eight, is very familiar with the building after holding the structure's maintenance contract for the past three years.
The new owners of Thirty-Eight had a distinct advantage most buyers can only dream of when purchasing a building.
A portion of the ownership group, MP1 LLC, held an important contract for the three-year-old, mixed-use building at 38 Commerce Ave. SW, and it gave them valuable insight into the structure’s quality.
“We were doing their maintenance for the last couple of years, so we were involved with the building already at that level,” said David Emdin, an owner of Maplegrove Property Management, which is based in East Lansing and manages the firm’s West Michigan operations.
Maplegrove and 38 Partners LLC, whose resident agent is Holland’s Shelly Padnos of the noted Padnos recycling family, make up MP1 LLC.
MP1 is the firm that recently purchased Thirty-Eight from Locus Development partners John Green and Andy Winkel for an undisclosed amount.
“We knew a lot about the building and we had a real good relationship with Locus Development — and one thing led to another,” said Emdin, who also is a licensed broker. “Locus Development did an excellent job with the design, construction and management of Thirty-Eight.”
Winkel told the Business Journal the sale left him and Green with a bittersweet feeling. “We have so many great memories of working hand-in-hand with the city to make this project a reality, so it was hard to pass the reins on. At the same time, we couldn’t have chosen a better group to sell the building to. Their management team is extremely well qualified, and we have no doubt that they’ll do an excellent job going forward,” said Winkel in an e-mail to the Business Journal.
Thirty-Eight is actually two “liner” buildings uniquely built around a city-owned parking deck at the intersection of Commerce Avenue and Weston Street SW, just a downtown block south of Fulton Street and a block east of the Van Andel Arena. The buildings have earned silver LEED certification.
One structure contains office space, while the other houses 43 one- and two-bedroom apartments. The parking facility has 379 yellow-outlined spaces. Both buildings offer ground-floor retail space. Locus Development invested $16 million into the buildings, which opened to rave reviews in the spring of 2010. Total construction topped $26 million. The structures offer more than 90,000 square feet of office, residential and retail space.
Almost all of the commercial space is leased. Adtegrity was the first business to move in. Other tenants are Deloitte, Ameriprise, Robert Half, Tiger Studio, Agent X and Two Beards Deli. Locus Development also has a suite there.
“The building is nearly 100 percent occupied. There are two commercial vacancies. There is a first-floor retail space on the corner of Commerce and Weston that is vacant. It’s a pretty big space sitting right on the corner there. The fourth-floor commercial is vacant and the developer is retaining ownership of those two units and is working on getting those leased,” said Emdin.
The retail space has 3,900 square feet available, and there is 12,000 square feet of office space available on the fourth floor. 38 Commerce LLC owns those spaces.
“The fourth floor can accommodate one tenant up to 12,000 square feet or several tenants as small as 1,000 square feet. Both spaces connect directly to the adjacent parking ramp, have floor-to-ceiling glass, and can be built out to meet tenants’ needs,” said Winkel.
As for the residential building, Emdin said all 43 units are occupied, including the eight penthouses. As he also pointed out, apartment complexes are not always fully occupied because people do move out from time to time. “But, basically, it’s 100 percent occupied,” said Emdin. “There is actually a wait list.”
The transaction has closed.
“We believe Locus did an outstanding job managing the building and it’s a great project,” said Emdin. “It’s so well designed, and we think it’s one of the premier properties in downtown Grand Rapids and are just so excited to now be the owners and managers.”