Findings are from The Right Place’s first-ever report that accesses several markets in the area, including industrial, office, retail and housing.
The report attributes the tight housing market to a lack of supply. But the report also found that the demand for housing has shown signs of cooling, due to high interest rates, when compared to last year.
Still the Greater Grand Rapids-area would need 35,000 housing units based on a separate study conducted in 2022 by the Greater Grand Rapids community.
Tim Mroz is the Senior Vice President of Community Development at The Right Place. He said The Right Place report found that that number could be chipped away through the development of more multi-family housing units.
“When you start talking about more dense housing, multiple floors that requires a lot of changes in a community both through technical zoning and regulations and things like that but also just you know community awareness and community acceptance of that type of development in those communities,” he said.
Mroz said because of the demand for housing and competitive rental rates in West Michigan, developers do see an opportunity to build in the area.
“Traditionally in West Michigan, rental housing has been a fairly weak sector. Over the past 10-15 years, that rental model has gotten stronger, and stronger… to the point where the rental rates that landlords are getting here in Greater Grand Rapids are nationally competitive,” he said. “So that’s changing the equation for a lot of developers, and they’re seeing that there’s a tremendous amount of opportunity here.”
Another key takeaway from the report found that the industrial market is “primed with demand” and several large-scale projects are consuming much of the available inventory.
Mroz said the lack of space for industrial development could stymie economic growth if it isn’t addressed.
“If we want our local economy to continue to grow, if we want are local businesses to continue to grow, if we want to attract new businesses to the area, we will stymie our economic growth, it sounds like a ‘duh’ statement, but we have to have places to put them,” he said.
Mroz adds a critical component of the report is to give the developer community and the wider community information to help plan for future growth in the region.