By Dottie Barnes
GVSU
A study by a GVSU economics professor reexamined the economic impact that coastal restoration to Muskegon Lake is having on area property values and recreational opportunities for the surrounding community.
Paul Isely, associate dean of the Seidman College of Business and professor of economics, first analyzed the housing market surrounding restoration sites along the southern shoreline of Muskegon Lake in 2011. His original study predicted $11.9 million in additional housing value and an additional $2.8 million annually in recreation value.
Using data from 2018 and 2019, Isely’s team found the total value of shoreline improvements based on home sale prices to be estimated at $7.9 million, and the value of additional recreational benefits estimated at $27.9 million annually.
Isely said the increase in recreation value between the two studies is due to additional restoration activity across the lake and a larger increase in the numbers of visitors than what was forecast in 2011.
“There have been major improvements to Muskegon Lake and the downtown Muskegon area,” said Isely. “However, the additional visits to the area in this study can be attributed to the lake. Cruise ships are coming to Muskegon Lake, more people are purchasing homes, launching boats and going sailing. The improvements are drawing people to Muskegon Lake even more than we thought.”
Isely said the removal of the Sappi Paper Mill, replacement of hardened shoreline with a softer shoreline and the removal of fill from sawmills has helped home values increase.
“This is exciting. It shows really powerful value,” he said. “In 2011, the housing value and additional recreational opportunities represented a 6-to-1 return on investment. This study validates that is true, if not bigger.”
Study highlights:
• An estimated 485,000 additional annual visits to the lake following restoration, an 11 percent increase
• People who visited the lake before restoration now visit two to four times more per season
• The total value of increased home values due to shoreline restoration was estimated at $7.9 million
• The total value of additional recreation following restoration was estimated at $27.9 million annually
• The additional recreational spending represents an estimated 4 percent increase annually for Muskegon County
James Clift, Great Lakes commissioner and deputy director at Michigan Department of Environment, Great Lakes, and Energy, said: “This study provides further evidence that restoring the Great Lakes benefits both our environment and economy. The Great Lakes Commission is proud to work with local partners like GVSU, as well as state and national partners, to create jobs, provide new tourism and recreation opportunities, and improve the quality of life in communities across the Basin.”
Approximately $35,000 was made available for this project through the Great Lakes Restoration Initiative. Grand Valley also received funding from the National Oceanic and Atmospheric Administration and U.S. Department of Commerce, through a Regional Partnership with the Great Lakes Commission.
More information is available in the final detailed report.
