A former New York City-based developer is targeting the small lakefront town of Traverse City, Michigan, for new turnkey luxury developments.
Freshwater Development founder Andrew McCarthy moved back to Michigan last fall after 15 years developing residential projects in New York City with firms Avery Hall Investments, SDX Real Estate and JDC Development. Rather than choosing his hometown of Grand Rapids, McCarthy selected the 15,000-person city 142 miles away on the coast of Lake Michigan, where he vacationed as a child.
In Traverse City, McCarthy followed flight data to see who was attracted to the nature-rich area. Visitors came from the East Coast, Texas and Arizona, each wanting second or primary homes. Most purchased older existing homes and remodeled, managing the process from afar. McCarthy noticed an opportunity gap in the housing stock.
“They want to be around natural resources, being around freshwater and the Great Lakes, and they want something that’s quality,” McCarthy said in an interview. “They want a home that’s turnkey.”
He tested that theory with a spec home that he said sold in June 2024 for $4.7 million. It went to a family seeking a vacation home, and McCarthy began to understand the buyer profile, prompting him to pursue larger residential projects that are currently for sale.
New high-priced rowhouses and condominiums hit the market
Sales opened Tuesday for Freshwater’s latest project, The Brownstones at 100 Park, a collection of three attached homes, with prices ranging from $1.9 million to $2.3 million.
The homes will be in “white box condition,” meaning the interior design choices will be left up to the buyer. According to the listings, the final costs will be closer to between $2.6 million and $3 million. As of June 24, they were the priciest townhouses on the market in Traverse City.
Unit A offers three bedrooms and four bathrooms in 1,941 square feet of living space. Unit B is larger, with 2,295 square feet of living space, five bedrooms and four bathrooms. Unit C is a four-bedroom, four-bathroom home that's 1,845 square feet.
The priciest townhouse to sell in the past year, according to Homes.com, was a 3,595-square-foot home with four bedrooms and four baths that went for $2.15 million.
Located off the Boardman River in downtown Traverse City, each includes a private boat slip.
Freshwater launched sales of 111 State, a two-unit building, in May, priced at $2.95 million and $3.25 million. These full-floor units are also among the most expensive in the city, along with other new construction condominium buildings in downtown Traverse City, such as 330 E State St. and 207 W. Grandview Parkway. The units at 330 E State St. were listed in April, according to Homes.com, and 207 W. Grandview Parkway hit the market a year ago.
Freshwater’s 111 State penthouses include direct elevator access, private rooftop terraces, about 3,500 square feet of living space, five bedrooms, three bathrooms, a library, marble countertops, custom millwork, and white oak floors.
Both the State and Brownstone developments repurposed existing structures located on “premier corners of Traverse” to capitalize on central downtown locations. Brownstone was an office building, and State uses the brick façade of a mixed-use property.
“The trend we’ve seen is more of a move to more urban areas in this type of city, a smaller town. People like to be able to walk. In previous generations, more space and square footage and acreage was important to them, and with younger people, people like to be able to walk, and they value the lifestyle,” said listing agent Lydia Smith of @properties Christie’s International Real Estate and Freshwater’s director of sales and marketing.