Post Office Wouldnt Deliver Hotel Site

November 8, 2002
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GRAND RAPIDS — Second Ward City Commissioner Rick Tormala flatly stated recently that he doesn’t want the post office to move from its downtown site just north of DeVos Place in order to make room for a new convention hotel on that property.

His concern is over the amount of income-tax revenue the city would lose if the local United States Postal Service processing plant left downtown for a large parcel in a suburb. If that did happen, the city would lose approximately $526,000 annually in tax revenue. (See related story.)

Tormala has heard the same rumbling that most everyone has over the past month: That Amway co-founders Richard DeVos and Jay Van Andel are getting ready to build a hotel on that site because they signed a letter of intent to buy Olds Manor from Peter Secchia.

The Olds sits just a few steps east of the Post Office building and if the two properties were combined, there would be room for a high-rise riverfront hotel with parking.

The buzz has DeVos and Van Andel — longtime financial backers of Republican Party candidates and causes — getting enough support from GOPers in the nation’s capital to move the downtown postal station to another location.

The most talked about site is property on Patterson Avenue in Kentwood near the Gerald R. Ford International Airport, where the postal service processes mail. If the downtown plant goes there, the income tax revenue Tormala fears losing would accompany it, and some have estimated that a move of that magnitude would cost around $15 million.

But there are a few kinks in that scenario.

One, the USPS doesn’t own the property on Patterson. Two, the land the postal service does own isn’t large enough to house a processing plant big enough to process everything. And three, moving the plant from its central location would raise delivery costs.

“We do not own that property, that is a leased facility,” said Gina Haisma, customer relations coordinator for USPS, of the Patterson processing plant.

The postal service processes flat mail, periodicals, newspapers and parcels at its Patterson location, while all the letters are processed downtown on Michigan Street near Monroe Avenue.

“I don’t believe that we have property large enough that would accommodate a processing facility. We would need more than we have downtown, quite a bit more for a processing plant,” said Haisma, who has been with USPS for 19 years.

“Usually when they put up a processing facility it’s going to be one big, flat, one-story building and it usually takes up quite a bit of space,” she added.

The downtown site is also the home base for carriers in two nearby postal zones: 49503 and 49507. If USPS moves its letter-processing operation from downtown, it would have to find another base or two for its delivery service to those zones.

“Ideally they’d be centrally located in their ZIP codes or their zone area because you want them to have as little travel distance as possible to and from their carrier routes,” said Haisma. “They wouldn’t be able to move out into the suburbs. It definitely would be too costly to do that.

“I know that it might not seem like a lot, but if you just add five or 10 minutes to every carrier route, and you’re dealing with six days a week, it adds up to big bucks.”

Haisma said that a while back USPS looked at property further south of the airport in the 52nd Street area, but nothing came of that search. She added that since the terrorist attacks and increased security at the airport, USPS moves a larger share of the mail on the ground than it did a year ago. So the agency’s need to be near the airport has diminished.

“We do fly the express mail, priority mail, and I’m sure a lot of first-class mail, but I don’t think we’re as dependent on that as we once were,” she said.

The postal service has had a moratorium on new facilities for a few years now, only allowing projects to go ahead for serious reasons such as life-threatening conditions. And, as Haisma pointed out, the cramped quarters downtown doesn’t qualify.

But she did say that USPS will soon unveil a new policy to replace the moratorium, one the agency feels will make operations more effective and less costly. The plan could involve consolidation, construction and closings for some cities.

“I really don’t know the details about what is coming up but the postal service has been working on what it calls a transformation plan, and part of that includes rightsizing and right-locating postal operations where we can be as efficient as possible,” said Haisma.

“I do think after the first of the year we will see some major changes in the postal service.”

Of course, if DeVos and Van Andel are fully committed to building a hotel on the Olds Manor and downtown postal site, they are completely capable of straightening out the kinks facing such a project. It just could be very expensive to do so.

But neither DeVos nor Van Andel has said what they eventually plan to do with the site. Nor has Alticor, Amway’s parent firm, disclosed what it intends to do with the parking lot it owns at Monroe Avenue and Fulton Street, a site that was at one time discussed for a hotel.

Still, the rumor involving Olds Manor and the postal service persists and probably will as long as the discussions for a new convention hotel on Calder Plaza continue. That plan is being proposed by Blue Bridge Ventures and Hines Interests LP.      

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