Lofts start at $950 at historic Detroit rehab that some said couldn’t be done

A 100-year-old Detroit apartment building west of Henry Ford Hospital that emptied out and fell into disrepair has undergone a full rehab — one that some said couldn’t be done — and will soon welcome its first occupants in more than a decade.

The 83-unit, 4½-story building, 1800 W. Bethune St., is set to reopen Feb. 1 as the Bethune Lofts with asking rents on the lower end of what is typically found in newly built or rehabbed buildings in the city.

The building also features unique and energy-saving heat pumps for heating and cooling in its apartments that are more commonly found in Europe, although starting to catch on in North America.

The roughly $10 million redevelopment was done by Design Build Detroit, a family-run company whose founder and chief executive, Michael Rivait, 65, moved his business to Detroit from Windsor in 2000.

Rivait, who also now lives in Detroit, has a background as an architect and licensed builder, which he says helps to control construction costs for his projects — allowing him to not have to charge high rents.

He also benefits from help from his adult daughter, who does interior design for the apartments, and from his wife, who handles leasing and marketing.

“Everything is in house,” he said. “My objective is to build equity into the deals, as opposed to spending all of the equity on fees. I don’t charge developer fees, I don’t charge contracting fees, because it’s my own deal.”

Rivait does, however, hire out for construction labor, which included Detroit-based contractors for the Bethune project.

The result is new market-rate apartments that are close to what development experts call workforce or “naturally affordable” housing, meaning rent levels that ordinary working people might afford.

The asking rents at Bethune Lofts start at $950 per month for studio units and $1,200 per month for one-bedrooms. (There are also a handful of two-bedroom units.)

What’s more, 20% of the building’s 83 total units are set aside at lower, below-market rents for those with qualifying incomes.

There will be on-site parking without charge and some electric vehicle charging stations. And residents can expect to save money on utilities, thanks to the installation of compact through-wall heat pumps in each Bethune apartment.

The Italian-made heat pumps provide both heat and air conditioning, and result in year-round savings of 20%-30% off ordinary utility bills, according to Toronto-based Gigawatt, which is licensed to distribute the Ephoca brand of heat pumps that are in Bethune Lofts.

This type of heat pump is unique in how each unit provides both heating and cooling, with no separate outdoor compressor, said Gigawatt cofounder Belinda Gilbey. Unlike some older generation heat pumps, these units were designed for all weather conditions — even well-below-zero temperatures, when a backup heat strip kicks on.

“The technology has come so far over the past 10 to 15 years that they’ll work in cold, cold climates and provide heat even when it’s zero degrees outside or negative 5,” Gilbey said.

From Windsor to Detroit

Back when Rivait first brought his business to Michigan, he did a lot of custom-built home projects as well as senior housing.

In the wake of the 2008 housing crash and recession, he pivoted to fix-and-flip house projects in Royal Oak, Berkley and Ferndale, and later in Detroit’s Bagley and University District neighborhoods.

Today, his primarily focus is rehabbing older apartment buildings.

Besides the Bethune project, Design Build Detroit has several other active or completed developments in Michigan, including in Jackson, Battle Creek and more in Detroit. One of the finished buildings — and where Rivait calls home — is the 24-unit Elaine Lofts at 5918 St. Antoine in Detroit.

The old Bethune apartment building dates to 1924 and was originally known as The Churchill Apartments. It has been vacant since about 2011, after suffering damage in a fire and getting shut down by the city.

Property records show a doctor in New York state bought the property for an undisclosed price in 2011. Rivait bought it from the doctor in January 2022. That sale price also wasn’t disclosed.

Rivait found the building in dilapidated condition with missing windows and two holes in the roof that ran all the way to the basement.

In an interview, Rivait recalled how not everyone believed at first it was even possible to rehab the building. But from his decades of experience in construction and restorations, he knew such a project could be done.

“I had some people when they walked through, ‘You can’t fix this.’ So I’m like, ‘OK, we’ll see, we’ll get it fixed,’ ” Rivait said.

“It was difficult, but I just kind of knew what to do and how to do it,” he continued. “From my perspective, it was just another rehab — but it was an extensive rehab. So there was a lot of reframing, there was a lot of stuff we had to do to get it structurally sound.”

The project did a gut rehab of the interior and kept the apartments within their previous footprint of mostly studios and one-bedrooms.

Higher interest rates have lately added to the challenge in Detroit of getting construction financing for new developments. Rivait said he feels fortunate to have secured lending for Bethune Lofts just before rates shot up.

“When I closed on this particular loan, the market was just starting to move, so I was able to get in just under the wire,” he said.

The project also received crucial help from a federal Housing and Urban Development loan and the city’s approval of a 12-year freeze on local property taxes

“Quite frankly, that is one of the main reasons I was able to put all of the funding together,” Rivait said of the tax freeze, known as an Obsolete Property Rehabilitation Act incentive or OPRA. “If you don’t have those incentives, the project’s numbers just don’t work.”

Units leasing up fast

Bethune Lofts is in a middle-income Detroit neighborhood that is several blocks west of New Center and Henry Ford Hospital.

Likely attracted by the non-luxury rents, the building has already preleased about 50 of the 83 apartments, Rivait said. There has been significant interest from hospital workers and other young professionals, he said, with most prospective tenants between ages 25 and 40.

“They’re young, they’re just starting out, they don’t want ownership,” he said. “They want to be in the city, they want the nightlife, they want the lattes — all of the things the city offers. And they just want some affordable housing.”

Residents can start moving in Feb. 1, although not all of the rehab work will be completed for another month.

Rivait is also finishing work on a nearby rehab of an 11-unit, two-story apartment building at 1732 Bethune, which could open in March with a coffee shop on the ground floor.

Further ahead, Rivait hopes to begin work this spring on his ambitious redevelopment plan for the former St. Agnes Catholic Church and school campus at 7601 Rosa Parks Blvd., which is close to Bethune Lofts. The church closed years ago and famously hosted visits by Mother Teresa in 1979 and 1981.

His St. Agnes redevelopment plan would create about 80 new apartments within the old church, rectory, convent and school buildings.

Contact JC Reindl: 313-222-6631 or Follow him on X @jcreindl.

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