Water Damage Restoration in Coopersville, MI

The city of Coopersville is trying to figure out its housing priorities after a developer’s proposal for a workforce rental housing project sparked outrage in the rural community and raised questions of how to manage future growth.

The city council initially supported Grand Haven-based Westwind Construction’s plan for the $51 million Meridian 43 housing project by recommending that Ottawa County approve a housing brownfield plan for the 216-unit project. The project would be the largest investment in multifamily housing that the city of 4,800 residents has ever seen, according to City Manager Dennis Luce.

However, after months of opposition from a small but vocal minority of residents, the city council voted 5-1 on Feb. 10 to rescind its prior recommendation.

Luce said the past few months of public engagement have revealed the city is going through an “identity crisis.”

Council Member Peter Weise, who at first supported the project as a way to ease the county’s housing supply crunch, was among the five members to rescind the incentives support.

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While some community members and elected officials aligned with the Ottawa Impact political faction opposed tax increment financing on principle, Weise found through his own public surveys that opposition extended beyond the incentives. Those concerns hinged on changing Coopersville’s small-town feel by increasing traffic congestion, and shifting the balance between rentals and owner-occupied units, he said.

According to data compiled by the city assessor, Coopersville had 1,027 owner-occupied housing units and 649 rental or multifamily units as of Dec. 31, meaning about 38% of the town’s housing stock is renter-occupied. If this project was built, the balance would shift to almost 46% rental/multifamily housing.

Joel Spoelman, a local certified public accountant whose firm Spoelman Hovingh & Feldt Inc. is across the street from the proposed development site, opposes both the tax incentives for this project and its potential effect on Coopersville.

“I think we’ve got to keep our rental units in check with ownership, and I think if that complex came in there, that would put things out of whack,” he said.

Betsy Merkins, another partner at Spoelman’s firm, worries the additional housing would bring more families to town and cause overcrowding in the schools. She also questions whether there’s a market for apartments that would be sandwiched between Fairlife and Continental Dairy’s processing plants to the north and the Republic Services Ottawa County Farms Landfill to the south.

Weise said the process uncovered the need to reassess Coopersville’s approach to housing development. The city staff and city council launched a review of Coopersville’s 2017 master plan just over a week ago as part of an effort to get residents on the same page about future land use.

The city council also is looking into housing alternatives, like small-footprint homes that could be affordable while still preserving the city’s “small-town charm,” Weise said. He said the council plans to take a hard look at the micro-homes design pilot floated by Ottawa County as part of that review.

“I think it will be really important … to help figure out what the community views as future growth, because it’s going to happen, and we need to be ready for it and have a plan,” Weise said. He estimates the master plan review will take about 12 to 14 months.

The process has also left Westwind Construction with no clear path forward.

Pete Oleszczuk, president of Westwind Construction, said he’s not sure how to pivot, as changing course on the project density could require a site plan amendment he’s not confident the city council would approve.

He also doesn’t want to scrap the plan, as Westwind has spent “hundreds of thousands of dollars” on it already.

“I want to work with the community to be able to make a housing community and project that is a step in the right direction for community growth, for business growth, for business opportunity, and for the school growth and opportunity,” he said. “That’s the type of communities we do. I don’t want to be the group that comes in and bastardizes a town. I believe our developments are a gem when it comes to what it is that we add. … It just spurs new growth, new opportunity, new residents, and new life into the towns.”

The proposed mixed-use project has been planned since 2023 on 20 acres of farmland at 49 S. 64th Ave. in Coopersville, just north of I-96. An affiliate of Westwind Construction is under contract to buy the land for an undisclosed price from an entity tied to Ottawa County farmer, businessman and philanthropist Ed Hanenburg.

The incentives plan would have reimbursed an affiliate of Westwind up to $6.4 million in eligible expenses over 15 years.

The city council’s move to rescind its support for the incentives came after a couple hundred residents and businesses began organizing last fall to oppose tax incentives for the development. About 40 residents and business owners showed up to the Feb. 10 meeting to speak against the project. Much of the opposition has been based on misinformation, which city officials previously addressed on social media, about how brownfield tax increment financing works.

The city council’s withdrawal of support was just the latest hurdle the developer has faced in the process.

Last November, the Ottawa County Finance & Administration Committee, which at the time was dominated by members affiliated with Ottawa Impact, voted against advancing the brownfield plan to the full county board, citing the opposition in Coopersville and the committee members’ own ideological issues with tax incentives.

Oleszczuk said in January his firm was planning to resubmit its incentives application to the county brownfield authority after the Ottawa Impact members who initially voted against it lost their majority on the board in the Nov. 5 election.

However, per state statute, a county cannot approve a brownfield plan without concurrence from the local government unit.

Now that brownfield incentives are off the table, Westwind is facing some tough choices about how to fund the project, Oleszczuk told Crain’s this week.

“(We’re) assessing, really, what our options are,” he said.

Because of high interest rates, construction costs and the looming possibility of tariffs, the firm’s inability to secure incentives may mean “changing the dynamics of the project,” he said, including shifting away from affordable housing.

The developers had planned to allocate 43, or 20%, of the proposed 216 units for households earning 95% or less of the area median income.

But now, “there isn’t the incentive there to try to help create that (affordability) unfortunately, and so it’s probably going to be scaled back a little bit,” Oleszczuk said. “To what extent, I do not know yet, but that’s going to kind of flush itself out as we work toward efficiencies to, candidly, have a bank engage.”

Oleszczuk said even with the possibility of incentives, it was proving tough to hit the metrics needed for a bank to feel comfortable with the project’s level of risk. That’s partly because Coopersville lacks comparable multifamily developments to use to benchmark demand.

Now, in order to “de-risk” the project enough to appeal to lenders, Westwind will likely have to bring down the price tag, which may mean reducing the density, he said.

Mandy Cooper, vice president of strategic initiatives at Lakeshore Advantage Corp., the economic development agency for Ottawa and Allegan counties, said it’s just a fact that affordable housing today can’t be built without incentives.

“Tools like brownfield TIF typically are a necessity if one of the goals is to ensure access to affordable housing,” she said. “Because without them, affordable housing projects just aren’t happening. The math just doesn’t work out. So the first question is, is it a priority for the community that there is housing available to all of their residents, for working professionals and families with moderate incomes who might not otherwise be able to afford the market-rate housing that can be developed without these tools?”

Cooper said most communities are comfortable with single-family residential, but more diversity will be needed in the housing stock to ensure affordability. Developments supported by brownfield TIF incentives will need to be part of that matrix, she said.

“Our hope is that as communities become more familiar with brownfield TIF and more successes are (being) shared, that they’ll become more open to it, because it really is a solid tool,” she said. “… In some ways, it really does become a simple binary choice between, do we want to make these projects possible and have a hand in it, or would we prefer not to participate in that way and invest in other housing options, which are more than likely going to be market rate?”

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