Park Businesses Applaud Rent Subsidies For Students

The Grosse Pointe Park Business Association is hailing the newly available city housing subsidies for college students as a potential boon for the business district, saying it will bring increased revenue for existing establishments and spur the development of others.

The and the Grosse Pointe Housing Foundation today announced the creation of a student grant program that would help offset the cost of renting the 580 rental units in the rental “district” running east and west from Wayburn to Beaconsfield and north and south from Jefferson to Mack, as well as south of Jefferson on Nottingham and Beaconsfield.

The program is designed to address two problems: the city’s aging population and the high rate of rental vacancies in the district, which the city estimates at around 20-25 percent.

Joe Hebeka, president of the Grosse Pointe Park Business Association, says the stores in The Park, the business district on Kercheval between Wayburn to Beaconsfield, are enthused about the program.

“The immediate effect is an increase in business traffic, because our stores will be within walking distance of a large number of students,” Hebeka said. “But the future impact is even better because these students will hopefully return to Grosse Point Park after college and buy a residence and raise a family. And hopefully their family will do the same.”

Hebeka, who took over from his father, said this kind of loyalty, which he enjoys, is extremely important to the stability of a business district. “Today I’m servicing people who my dad gave candy to when they were nine-years-old,” he said. “Now they’re adults and have kids of their own.”

The grant program will offer qualifying students up to 50% of their rent, not to exceed $350 per month. Students must be enrolled in an undergraduate or graduate program at a four-year university, maintain a 2.5 or higher G.P.A., and take at least 12 credits per semester. They must provide a copy of their class schedule during the application process and only grant will be awarded per housing unit. Freshman are expressly excluded from the program.

Landlords must also meet certain requirements to participate in the program. They must have their rental unit approved for participation by the Grosse Pointe Housing Foundation, provide proof that the unit meets all City Code of Ordinance requirements and submit proof of valid Certificate of Occupancy. They must also provide proof that payments on the mortgage and all ad valorem taxes are current, make 12-month leases available, and file a copy of the lease with the Foundation.

Grosse Pointe Park City Manager Dale Krajniak said he was approached last year by Jon Cotton, a Grosse Pointe Farms resident and the owner of Detroit-based Health Plan of Michigan, who expressed an interest in doing something to prop up the Park’s rental district.

Cotton was alarmed by the impact on the area of the state’s economic slump, which had lead to foreclosures, unpaid taxes, a rising rental vacancy rate, and a reluctance among landlords to invest money in improving their properties. Encouraged by the city, Cotton created the Grosse Pointe Housing Foundation in December and launched the program with a single gift of $250,000 from an anonymous donor.

“That will allow us to make a fairly strong impact,” said Cotton, who said the single gift should fund about 70 grants for one year. “We want to get the program up and running and establish a track record” that should lead to more donations. As of 4 p.m. today, Cotton had received two landlord applications but no student applications. Both forms are available at the city's Web site.

Cotton, who said there are no discussions at this time of granting rental subsidies for students in the four other Pointes, reiterated that a major goal of the program is to attract people to Grosse Pointe for a lifetime.

“We lose a lot of young individuals to other communities, and that’s if they stay in the state,” he said. “The idea is if they live here during their prime, this will become their community, and then once they graduate and get a higher paying job they will move from rental and purchase a home.”

Asked if The Park has enough stores of interest to college-aged residents, Hebeka said “I think we have a good platform for it. And I think that these student might cause a demand to open more businesses to accommodate them.”

Krajniak says the new grant program is also a powerful reminder that a tiny seed can yield abundant fruit.

“A small number of people can make a great difference in a community,” he said. “The Foundation has the potential to make a very positive impact on us.”