Workforce Housing Project Eyed for Eighth/Lake

The Traverse City Housing Commission (TCHC) is targeting a new workforce housing complex near the intersection of East Eighth Street and Lake Avenue, which could potentially bring 40-50 income-restricted apartments to the downtown area. Though still in its early stages, the project offers a unique collaborative opportunity between TCHC, the City of Traverse City, the Grand Traverse County Land Bank Authority, and S B K Properties LLC – the private property owner of the former Copy Central building.

TCHC has signed a long-term option for the Copy Central property, which gives the organization an extended due diligence period to line up the complex real estate and funding pieces needed to bring the housing project to life. TCHC also hopes to acquire a small triangle-shaped parcel owned by the City of Traverse City just west of Copy Central, plus a longer strip of land that runs parallel to Lake Avenue from East Eighth Street down past Oryana. That property, once targeted for a new road that would connect Fourteenth Street to Eighth Street, has been held by the Grand Traverse County Land Bank Authority on behalf of the city and county brownfield redevelopment authority (BRA) since the road project was abandoned years ago.

With the road scuttled, a portion of the parcel was used for a new public outdoor fitness court in 2022 near Oryana. At the time, officials noted there was still a “substantial developable area” remaining on the north end of the parcel that could accommodate a “collaborative and effective approach to expand housing options in the city.” That potential grew when Sean Skarshaug – who bought the Copy Central building in 2015 with his wife Blythe under S B K Properties LLC – consolidated Copy Central and sister company Traverse Repro into a Barlow Street facility last fall.

That move allowed the couple to start exploring options for the East Eighth Street property. Skarshaug is in Rotary with Wayne Workman, who sits on the TCHC board, and began chatting about possibilities. Given the scarcity of downtown real estate and the site’s high-profile location on a busy corridor near Boardman Lake, the Skarshaugs could have easily listed the site on the open market and made a quick sale. But Sean says the couple had a deeper motivation and were willing to give TCHC a long grace period to try and make the housing project happen.

“We believed we had a property that was perfectly suited for this project with the (adjacent) County Land Bank property and the city-owned sliver and the Housing Commission, which can do something really amazing,” he says. “We’re excited as the owners of that property to see it become something that could be cool for the community.”

TCHC Executive Director Karl Fulmer says the Skarshaugs have been “wonderful throughout the process,” calling them “community-minded people.” He acknowledges the project path ahead involves a “a very complicated process, because there are many different players involved and many different potential funding sources.” He adds that due diligence could potentially take anywhere from “eight months to 30 months. I anticipate it to be a fairly long process, just due to the funding sources we might try and utilize for it.”

Those could range from the Michigan State Housing Development Authority (MSHDA) to Traverse City’s payment-in-lieu-of-taxes (PILOT) program to local and state brownfield funds, among others. Some of those sources have competitive grant and loan cycles, like MSHDA – applicants typically go out for that funding twice a year and can sometimes endure multiple rounds before obtaining approval, if at all. “We obviously don’t want to purchase the property unless we have some significant idea that we have all the funding lined up,” Fulmer says.

TCHC also needs to secure the other two properties. The three sites together would likely total 7-9 acres, which Fulmer says could support 40-50 units. City Attorney Lauren Trible-Laucht says she’s informed city commissioners of TCHC’s desire to acquire the tiny .05-acre city triangle. The city also has a property “interest” in the Land Bank Authority parcel, Trible-Laucht says, as it was originally acquired for city purposes. There are advantages to the Land Bank Authority temporarily holding one or both of those properties – including eligibility for certain funding sources – so one discussion point will be how ownership is structured. Another discussion point will be cost. Trible-Laucht says the city can’t “donate” property outright – there “has to be an offset for the value,” she notes – but could “heavily discount” it in support of a purpose like bringing workforce housing to the city.

The TCHC housing project is listed as an agenda topic at the Land Bank Authority’s meeting Friday at 9am at the Governmental Center, though only a simple project update is expected. Fulmer says he anticipates going to the city commission for review within the next 60 days. Though there’s “still a lot of work to be done” in the planning process, Fulmer is hopeful the project could eventually help house “workers who support many of our downtown businesses.”