The office building will have floor plates ranging from 25,000-sf to 30,000-sf. Of that space, 10,000-sf to 15,000-sf will be available for retail uses. The project will cost about $55 million, with $30 million in development planned for the first phase.
The company had planned on building a six-story, 229,030-sf office building; a seven-story, 101,188-sf hotel and 14,025-sf of retail. The $95 million project was shortened due to a lackluster economy and recent world events, according to the company.
Michael Polsinelli, the Royal Oak project manager for Schostak, said the project will probably begin in about a year. The company must spend 180 days for due diligence. Also, potential tenants have asked to suspend negotiations for 60-90 days as they go over current cash flow in light of the drop in revenue since the attacks in September.
The company is paying $2 million to build the office, retail and parking deck on the land. They can then bring in a hotel firm within three years, or the company will build another office building of the same size. Schostak will then pay another $2 million to the city for the property.
The land in Royal Oak is seen as a gateway to the downtown, one of Southeast Michigan's most popular nightlife spots. Tri-Mount Construction built condominiums just north of the site but lost its bid to build a hotel and more condos on the site in March, after the company scrapped an office project that was supposed to adjoin the hotel.
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