Muskegon real estate developer gets $18 million from Michigan taxpayers

Michigan’s 2024 budget avoids naming a private Muskegon real estate developer that is getting $18 million from taxpayers.

Parkland Properties of Michigan got the eight-figure allocation by meeting a narrowly crafted description in a one-paragraph earmark.  

The 2024 state budget document describes the deal, in which Parkland receives the grant for purposes of developing a residential complex, this way:

From the funds appropriated in part for housing grants, the department shall allocate $18,000,000.00 to a development firm founded in 1988 and located in a city with a population between 36,000 and 39,000 and in a county with a population between 175,000 and 176,000 according to the most recent federal decennial census for the rehabilitation of a historic manufacturing site to support housing.

A Facebook post by Parkland Properties on July 27, 2023, announced that the company would receive $18 million from state taxpayers:

The State of Michigan appropriated $18 million in its 2024 budget to support Parkland Properties' adaptive redevelopment of the former Shaw Walker Furniture Company into a lively, mixed-use, community. We appreciate the support and confidence of our State partners as we collectively pursue this important housing project for West Michigan!

The language the legislators used makes it easier to give money to favored entities, said James Hohman, budget policy director at Mackinac Center for Public Policy.

“The state constitution requires that acts that benefit particular areas of the state or private entities receive two-thirds approval in both legislative chambers,” Hohman told Michigan Capitol Confidential. 

Not naming the beneficiary outright allows lawmakers to skirt this supermajority requirement. 

“Today, Parkland is one of the largest real estate development firms in West Michigan with over 250 employees and over 1 million square feet of building space currently developed or under development,” the company’s website says.

The money will be used to turn the former Shaw-Walker factory in Muskegon into 550 apartments and condominiums. The project will cost $220 million.

Democrats currently control the legislative and executive branches of Michigan’s government. Gov. Gretchen Whitmer campaigned on the theme of having more government transparency, a theme echoed by many legislators.

The current state budget, however, does not disclose who requested the money and why the company was picked to receive it.

Company owner John Rooks responded to CapCon’s request for comment with the following:

The City and County of Muskegon performed Housing Needs Assessments in 2023 that demonstrated the need for 2,924 new housing units in the City and 9,184 new housing units in the County by 2027. These needs are spread across all spectrums of affordability. The planned adaptive redevelopment of the Shaw Walker Furniture Company is a transformational housing project that will take one of the largest blighted structures in the State and convert it into over 550 housing units targeted primarily at the attainable housing market (also known as the ‘missing middle’). This is expected to help ease the burden on the local housing market across the lower and middle income tiers. The project is complicated due to its size (at over 730,000 square feet of building space) and its prior use as the largest furniture factory in the world. There are a variety of complex environmental and structural issues that must be addressed to preserve this important historic building and repurpose it into a meaningful use for the area. Public funding is necessary to begin addressing these complex and expensive issues and to allow the project to move forward.