State Report Questions Whether Grand Rapids Can Support Million-Dollar Condos in DeVos, Van Andel Riverfront Project

State Analysis Raises Doubts About Fulton and Market Luxury Development

An independent state-commissioned analysis is raising questions about whether downtown Grand Rapids can support the ambitious luxury housing and condo market envisioned for a massive $796 million riverfront development led by members of the DeVos and Van Andel families.

The report, produced by SB Friedman Development Advisors in July 2025, was required by the Michigan Strategic Fund as part of its evaluation of a $560.9 million request for Transformational Brownfield incentives for the Fulton and Market project. The Michigan Strategic Fund approved the incentive package in December 2025.

The project would transform a nearly seven-acre riverfront parking lot next to Acrisure Amphitheater into luxury housing, a boutique hotel, retail, restaurants, and an office tower. The development is led by Fulmar Development Partners, a joint venture between members of the DeVos and Van Andel families and Chicago-based Magellan Development Group.

Apartments Priced at the Top of the Market

The 43-story residential tower would contain 595 apartments and ground-floor retail. The building, which would become the city's tallest, is expected to cost $328.3 million with construction slated to begin in summer 2027.

According to the SB Friedman report, the project targets apartment renters with household incomes of roughly $120,000 for studio units, $180,000 for one-bedroom apartments, $210,000 for two-bedroom units, and up to $240,000 for three-bedroom apartments.

The report estimated that the condos would be priced 36 percent to 92 percent higher than today's most expensive downtown apartments. However, the specific projected rents were redacted from the version of the report obtained by MLive through a Freedom of Information Act request.

The report noted that no site-specific market study has been conducted to evaluate demand for the project's 595 apartments at their proposed rental rates. To gauge demand, SB Friedman reviewed Kent County's housing needs assessment, which estimates that higher-income households in Grand Rapids will need more than 1,000 rental units and nearly 1,400 owner-occupied homes by 2029.

Even with this demand data, SB Friedman cautioned that only site-specific market studies can identify the appropriate unit mix, pricing, and absorption for particular development sites.

Housing advocates such as Housing Next have stated that adding housing at all price points, including luxury units, is necessary to help close Kent County's housing gap.

Condos: A Luxury Bet

The report's most pointed questions focus on the project's 76 luxury condominiums, which would occupy the same 27-story building as a 130-room boutique hotel.

The Fulton and Market development team expects to sell the units over approximately four years, representing an average pace of 19 condominiums per year, according to the SB Friedman analysis.

To test this assumption, SB Friedman reviewed recent sales data from Zillow and found that at least 11 downtown Grand Rapids condos priced at $1 million or more sold over the past five years, averaging about 2.2 sales per year.

Based on this comparison, the report concluded there is limited evidence that the market can support condo sales at the pace and price point projected.

The report stated, The pace of condo sales anticipated by the development team is significantly more aggressive than what has been observed in the market recently.

One local realtor disputed the completeness of the data included in the SB Friedman report, noting that public listing databases such as Zillow can miss high-end transactions that occur before units are formally listed for sale.

The report estimated the condos would be geared toward residents with average household incomes of $515,000.

Developer Bears the Risk

Despite concerns about demand, officials stated that taxpayers are not financially exposed if leasing or sales fall short.

Ultimately, the financial risk of lower than projected occupancy is entirely on the development team, said Joe Agostinelli, founder of Michigan Growth Advisors, who helped lead the project's request for public funding through the state's Transformational Brownfield program.

The $560.9 million incentive package is not an upfront payment to developers. Instead, it allows Fulmar Development Partners to be reimbursed with up to that amount in future state and local taxes generated by the project over 30 years to offset construction costs.

If the Fulton and Market development underperforms once it opens, less tax revenue would be generated and therefore less would be reimbursed to the developers.

Hotel and Office Tower Concerns

The project includes a 130-room luxury boutique hotel designed to offer services and room finishes above those currently available in the downtown market.

While the projected average daily room rate was redacted from the version of the report obtained by MLive, the analysis cited a CBRE market study that found a $271 average rate is feasible when the hotel opens, potentially in 2029.

That is higher than downtown's top-tier hotels, which averaged $194 per night in 2023, the most recent year of complete data, according to the report.

The average daily rate estimate cited in the SB Friedman report was prepared by AHC Hospitality, which is owned by the DeVos and Van Andel families. The company owns or manages several downtown hotels, including the Amway Grand Plaza, the JW Marriott, and the AC Hotel by Marriott Grand Rapids Downtown.

The projected occupancy for the Fulton and Market hotel is notably higher than that of comparable downtown hotels, according to the SB Friedman analysis. Developers estimate the hotel will open at 75 percent occupancy in its first year, increasing to 78 percent in subsequent years.

However, the SB Friedman analysis cites data from the firm STR, which shows that top-tier downtown hotels averaged 65 percent occupancy in 2023.

The report stated that the projected occupancy rate for the hotel appears aggressive relative to the existing market.

The Fulton and Market project includes a 21-story office tower with approximately 420,000 square feet of office space, along with ground-floor retail and an integrated parking deck. The building is envisioned as a single-tenant headquarters building.

State Funding Process

The Michigan Strategic Fund's requirement for an independent analysis as part of the incentive approval process demonstrates the state's commitment to ensuring taxpayer funds are used wisely.

The Transformational Brownfield program is designed to incentivize the redevelopment of brownfield properties in Michigan's most distressed communities. The program reimburses developers with future state and local taxes rather than providing upfront payments, creating a direct link between project success and public benefit.

The state's approach ensures that if a project fails to generate the anticipated economic activity, the reimbursement to developers decreases accordingly. This structure protects taxpayers from bearing the financial risk of development failures.

The Fulton and Market project represents one of the largest development proposals the Michigan Strategic Fund has evaluated in recent years. The state's decision to require independent analysis reflects the significant public interest and scrutiny surrounding projects of this scale and cost.

What This Means for Grand Rapids

The SB Friedman analysis highlights important questions about whether the downtown Grand Rapids market can support the ultra-luxury development envisioned by Fulmar Development Partners.

The report's findings suggest that while there is demand for housing in Kent County, the specific price points and sales pace projected for the Fulton and Market condos may exceed what the current market can support.

The analysis also raises questions about whether the luxury hotel occupancy projections are realistic given the existing downtown hotel market.

These findings do not necessarily mean the project should not proceed, but they do indicate that developers should carefully consider market realities when planning such ambitious developments.

The state's requirement for independent analysis demonstrates that public funding decisions are being made with thorough review of market data and project feasibility.

For West Michigan residents, this story underscores the importance of state oversight in development projects that receive significant public funding. It also highlights the ongoing housing challenges facing Kent County and the diverse approaches being taken to address them, from affordable housing initiatives to luxury developments.

The Michigan Strategic Fund's approval process and the findings of the SB Friedman analysis will be closely watched as the Fulton and Market project moves forward. The development's ultimate success will depend on whether it can meet the ambitious projections while delivering value to the community and taxpayers.