GRAND RAPIDS, Mich. (WOOD) — A developer has hit the brakes on a proposal to add dozens of apartments to Grand Rapids’ Eastown neighborhood.

The decision by Wheeler Development Group comes almost a year after the company began sharing its Robinson Flats proposal with the community. Wheeler Development Group spokesperson Jason Wheeler said that while pricing the project out in the bidding phase, all numbers across the board were significantly higher than what the group could adjust through its “normal process,” including shifting to alternative materials that are more readily available.

“Because of the economic conditions that we’re facing, that particular project design does not make financial sense at this time,” Wheeler said.

He said inflation has driven up the cost of key materials that would be needed for the underground parking Robinson Flats requires. According to Associated General Contractors of America, the cost of materials and services needed for new, non-residential construction projects jumped nearly 21% from April 2021 to April 2022.

While the price of lumber remained flat compared to the previous year, the AGCA’s producer price index showed steel, concrete and glass rose 25.1%, 10.9% and 9.8% respectively over the same time period.

Add to that the unknowns of renovating an existing building and the economic uncertainty of the near future and the project wasn’t viable, according to Wheeler.

Wheeler said it’s rare for their company to halt a project like this, but he thinks a lot of construction projects at other firms may also be reconsidered this year because the industry is “dealing with unknown factors that haven’t been present in the decision-making process for a long time.”

Wheeler says it’s now up to the owner of 1407, 1409 and 1417 Robinson Road to decide if and how that site will be activated. He says Wheeler Development Group will “always leave the door open” to revisit Robinson Flats if the market shifts.

“This doesn’t mean we’re not interested in looking at the Eastown area to bring market rate and affordable housing options, just this particular design at this particular site doesn’t work for us right now,” he added.

“What we’ve decided to do is put that project on ice and focus on the projects now that we’ve been able to get moving,” he said.

Wheeler Development Group’s focus now is on other projects that are pricing out fine, including Village East of Ada. While market challenges with materials also forced Wheeler Development Group to change and update its plan for the building exteriors of Village East, construction of the 92-apartment project is expected to start this year and wrap up next year, according to Wheeler. Wheeler Development Group also expects to complete its 52-unit townhome project called Evergreen Flats by the end of this year.

Both Village East and Evergreen Townhomes are market-rate housing, which Wheeler says is also in high demand by people who may be looking to move out of one home into another, or from a larger market to Grand Rapids. Wheeler says 40% of the units planned for Evergreen Townhomes are already spoken for, and they’re only in the preleasing stage for that project.

“Getting projects to move forward is tough right now, that’s the reality. But the demand for housing is so high right now,” Wheeler said. “The market’s not dead but certain projects need to be better considered.”

Between construction and completion, Wheeler Development Group expects to add 150 housing units to the area this year.

As for Wheeler Development Group’s plan for the Wedge property in downtown Grand Rapids, the company has until October to decide if and how it will move forward with the proposal dubbed City Tower.