Construction Underway on McKinley’s Glencoe Oaks near Ann Arbor
- Aug 25, 2014
Ann Arbor, Mich.—Construction is underway on Glencoe Oaks, a luxury apartment community being developed by McKinley in Pittsfield Township, Mich., which feeds into the Ann Arbor school system.
Part of the 600-unit Glencoe Hills development, Glencoe Oaks is a four-story building with two-, three- and four-bedroom apartments. Construction commenced in mid-June, and is slated for completion in April of next year.
Glencoe Oaks is situated on Glencoe Hills Boulevard, near a number of other McKinley rental communities, including Glencoe Hills.
Ann Arbor-based McKinley already enjoys a large market presence in this southeast Michigan community, owning and operating 5,500 units in the market.
“That gives us a very significant advantage both in execution and in collecting data. We have such a large platform in this market that adding additional units is more cost effective for us than for someone else,” McKinley Chief Executive Officer Albert M. Berriz tells MHN. “We expect to have more units come out of the ground here in the next two years as a result.”
Berriz reports rent increases have exceeded 10 percent compounded in Ann Arbor during the past three years. The rents today support the construction of new rental properties, which wasn’t the case several years ago.
“The biggest challenge for us is that this is a complicated place to get development approvals,” he reports.
“You don’t see a lot of deals coming out of the ground. You have to work hard and be very good to get approvals. It’s a high barrier-to-entry market. We work hard and do a very good job to make sure we can secure the approvals. We work hard with the municipalities and always do what we say we’re going to do.”
There are a number of good reasons to develop in and near Ann Arbor that go beyond rent growth, he adds. “The economy is driven by the University of Michigan and University of Michigan Hospitals,” he says. “It’s also driven by a high-tech community that is creating a lot of jobs. It’s really a much more robust economy, compared with the rest of Michigan and immediate Midwest.”
Construction financing for the project is being provided by US Bank.
The addition of Glencoe Oaks stands to benefit the community of upscale renters in Pittsfield Township. “This is a luxury option,” Berriz says. “We’re bringing in supply when there are few options. So this will be good for the renting community.”