GRAND RAPIDS, MI — An East Grand Rapids insurance and risk management firm is the latest tenant to lease space within a new 15-story office building under construction in downtown Grand Rapids.
Van Wyk Risk Solutions will lease the 10th floor of the Warner Building, 150 Ottawa Ave. NW., and plans to move in once construction wraps up by late July or early August, Orion Construction spokesperson Jason Wheeler said Friday.
The addition of Van Wyk means commercial space at the building is now fully leased. Other tenants include Chemical Bank and the law firm Warner, Norcross + Judd.
“It’s huge for us,” Wheeler said. “For us, it was confirmation that providing new commercial office space in the urban core is still an important facet, because we are running out of inventory when it comes to renovated space.”
The Warner Building is being built alongside a 12-story Hyatt Place Hotel that’s also under construction. Both buildings are owned by a partnership that includes Orion, DTM Management of Lansing and SIBSCO, the real estate firm run by the family of Peter Secchia, a local business leader and former U.S. Ambassador to Italy.
Together, the two buildings have a $72 million price tag. They are located at the site of a former 125-space parking lot.
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David Wiener, a senior vice president at Colliers International, a real estate firm that worked to bring VanWyk to the Warner Building, said the fact that the building’s commercial space is fully leased demonstrates the demand for high-end office space downtown.
“Any building that has had some money put into it recently, space is almost non-existent,” he said.
Warner, Norcross + Judd will occupy the most office space in the Warner Building – floors 11 through 15. Chemical Bank is leasing the 9th floor for its West Michigan headquarters.
A 432-space parking garage will occupy floors 2 through 8.
And the first floor will host a Chemical Bank branch and space for about two retailers. Wheeler said the retail space has not been leased, but there are a “bunch of interested partners.” Possible uses for that space could include a coffee shop or other retail options. Wheeler said it also could possibly be used as office space for a nonprofit organization.
Wiener’s firm tracks vacancy rates at 104 office buildings downtown. He said the overall vacancy rate is 11.3 percent. But when examining high-end office space, that’s either newly constructed or renovated, the vacancy rate is about 5 percent, he said.
The Warner Building is the only major office building under construction in downtown Grand Rapids, Wiener said.
While his firm’s statistics show a high-demand for office space, the sector hasn’t been without its challenges.
At least one project underway in downtown Grand Rapids was once eyed for office space, but the developer backed away from the idea.
Commercial real estate firm SIBSCO originally planned to build a 12-story, 150,000-square-foot building with several stories of office space, as well as ground-floor retail and restaurant space, at the corner of Division Avenue and Weston Street SW.
That plan didn’t materialize after developers failed to draw sufficient interest from tenants and retailers. The project has since been scaled back to include a three-story building, with first floor retail space and apartments on the two remaining floors.
backed away from its plans to develop a seven-story office building – aimed at attracting one of the region’s large employers to high-end space downtown – at the Studio Park development.
Studio Park is a $140 million movie, housing, hotel and parking development south of the Van Andel Arena. The developers behind the project still plan to include an office space component, though it will differ from what Franklin Partners envisioned.