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Former Casino Transformed into Affordable Housing Complex

  //house-home.news-articles.net/content/2026/02/2 .. transformed-into-affordable-housing-complex.html
  Published in House and Home on Friday, February 27th 2026 at 20:32 GMT by MLive
      Locales: Michigan, UNITED STATES

PETOSKEY, MI - February 28th, 2026 - What was once a bustling casino and resort is continuing its transformation into a beacon of affordable housing in Northern Michigan. Norstar, the apartment complex built on the site of the former Odawa Casino Resort, is undergoing a significant expansion, adding 44 new units to its existing 76, bringing the total number of apartments to 120. The project, slated for completion later this year, is being hailed as a critical step in addressing the escalating housing crisis gripping many communities across the state.

Norstar's story is one of adaptive reuse, a growing trend in urban and rural development that prioritizes repurposing existing structures rather than solely focusing on new construction. The Odawa Casino Resort, a significant economic driver for the Petoskey area for many years, faced challenges in a competitive gaming market. Its closure left a sizable, vacant property--a potential eyesore and economic drain--but also a unique opportunity. Northern Initiatives, a community development financial institution (CDFI), saw the potential in converting the building into much-needed affordable housing. The initial 76-unit complex opened in 2023 and quickly proved the viability of the concept.

The current expansion, estimated to cost $15 million, underscores the sustained demand for affordable options. The new units will offer a mix of one-, two-, and three-bedroom configurations, catering to a diverse range of household sizes and needs. This variety is crucial, as the lack of suitable family-sized affordable housing is a particularly acute issue in many Northern Michigan communities.

"This expansion represents a significant step in addressing the critical need for affordable housing in Northern Michigan," stated Kelly Gillespie, Executive Director of Northern Initiatives, in a recent press release. "The ongoing success of Norstar demonstrates the power of creative redevelopment to transform blighted properties and provide much-needed housing options for families and individuals."

The growing population of Northern Michigan is a key driver of the housing shortage. The region has experienced a surge in popularity as people seek a higher quality of life, drawn by outdoor recreation opportunities, a slower pace, and a sense of community. This influx, while positive for local economies, has dramatically outpaced the available housing supply. Traditional housing construction has struggled to keep up, partly due to factors like rising material costs, labor shortages, and the challenges of building in environmentally sensitive areas.

Funding for the Norstar expansion isn't solely reliant on traditional lending. A combination of state and federal grants, including potentially Low-Income Housing Tax Credits (LIHTC), along with private investment, is financing the project. This multi-faceted approach demonstrates a commitment from various stakeholders to tackle the affordability challenge. The LIHTC program, in particular, has been instrumental in financing affordable housing developments across the country.

Beyond providing housing, the Norstar project is also providing a boost to the local economy. Construction of the expansion is projected to create approximately 150 jobs, offering employment opportunities for skilled tradespeople and laborers. These jobs provide immediate economic benefits, and the completed complex will generate ongoing employment through property management and maintenance.

The Norstar model could serve as a template for other communities facing similar housing challenges. The successful conversion of a defunct casino into a thriving apartment complex highlights the potential of adaptive reuse to address multiple community needs simultaneously. By repurposing existing structures, developers can reduce construction costs, minimize environmental impact, and revitalize blighted areas.

Looking ahead, Northern Initiatives and its partners are actively exploring additional opportunities for affordable housing development in Northern Michigan. They are focusing on innovative financing strategies, sustainable building practices, and collaborative partnerships with local governments and community organizations. The organization believes that a comprehensive, multi-pronged approach is essential to ensuring that everyone has access to safe, decent, and affordable housing in the region. The expansion of Norstar is more than just adding units; it's a symbol of hope and a testament to the power of community-driven solutions.