A Smart Renaissance On Monroe
GRAND RAPIDS — Monroe North has it all.
Retail, industrial and office, along with housing, parks and parking.
The business district, which is beginning to look more like a neighborhood, is also home to a Renaissance Zone, is part of the downtown SmartZone, and has one of the last remaining riverfront properties in the city that is available for commercial development.
Monroe North also has its own financing authority, which is one reason why it was included in one of the city’s two high-tech SmartZones.
The district is also close to the Van Andel Institute for Research and Education and the new GVSU Health Professions Building, which is the other reason why it was included in the zone.
“We believe there is a synergy in being close to those areas where we hope a lot of technology is going to come out of,” said Susan Shannon, city business advocate.
The SmartZone differs from the Ren Zone in that the former is more regional in nature than the latter, and the benefits for being in one differs from the other.
Being in the Ren Zone means a nearly tax-free status on state and city taxes for an owner of any type of business, while being in the SmartZone means assistance from the city for a list of infrastructure items for owners of high-tech firms.
Funding for the downtown SmartZone benefits will come from the Monroe North Tax Increment Financing Authority, or TIFA. The TIFA can capture a portion of the property taxes landowners pay and the city can use that revenue for upgrades within the zone.
“If a high-tech company were to come there, there are some things that we can do to make infrastructure improvements in the area,” said Shannon.
“So, say along the river, which has a nice property there, we got a high-tech company,” she added. “We can spend the tax increment that will come out of the district to do some things. We can make road improvements, the same kind of public improvements we can make downtown.”
The city can also use that money to buy land, add ADA access to a building, and bring a broadband connection to a site.
The nice property that Shannon referred to is on the west side of North Monroe Avenue.
Those 1.5 acres are on the east bank of the Grand River, between Michigan and Trowbridge streets.
To the south are the post office and an I-196 overpass. A city parking lot sits just north of the vacant parcel. Across the street are two more parking lots and an auto repair business. One block south is where the new $211 million convention center is going up.
Investors from here and Lansing bought the parcel from the city a few years back and it’s for sale.
S.J. Wisinski & Co., the area’s largest commercial real estate broker, has the listing.
While that property hasn’t exchanged hands yet, two others in the district are close to being sold. A pair of buildings that housed the former Grand Rapids Foundry recently went under contract. The structures are located on the northwest and southeast corners of the Trowbridge and Bond intersection, a block east of Monroe Avenue.
It is possible that a high-tech company could land in both the Smart and Ren zones, if the firm picks the right spot. Only a few such parcels exist and one is the Brass Works Building at 648 Monroe Ave., a 200,000-square-foot office building a half-block north of Trowbridge. If a firm located there it would get the tax benefits of the Ren Zone and be able to ask for some street upgrades — say, along Bond Avenue, the street east of the Brass Works.
But Jack Buchanan, CEO of Blue Bridge Ventures and part owner of the Brass Works, told the Business Journal that the SmartZone hasn’t been a draw for luring tenants to his building because the benefits it offers haven’t been made clear.
“We’ve focused more on the Ren Zone. When people look at this building, or look in the area, they’re not looking here because of the Ren Zone or the SmartZone. When we say this is a Ren Zone, they say that’s great. But then when we ask a couple of questions, they don’t know what that means,” said Buchanan, whose company brokers and develops properties.
“And it’s the same with the SmartZone,” he added. “I think the SmartZone is that much more confusing for people. They don’t know what value they gain from that. So we focus more on the marketing toward getting them into the area.”
Buchanan said his firm’s marketing efforts first revolve around what Monroe North is becoming, and, secondly, on the benefits the Ren Zone provides.
“They know it’s a good thing. But they really don’t know what it means, for the most part,” he said of what potential tenants know of the Ren Zone. “It’s even that much more difficult to explain the SmartZone value.”
Shannon said the city has begun working with a marketing consultant to get the SmartZone benefits out to the public.
Although all of Monroe North is in the SmartZone, not all of it is in the Ren Zone.
And the part that is in the Ren Zone isn’t contributing tax-increment dollars to the TIFA, which is funding the SmartZone. And it looks like the city will only have about $210,000 in TIFA funds available to be spent on the SmartZone this year.
But as Shannon pointed out, a lot of commercial investment has been made in the Ren Zone. And when the tax-free status expires in 2012, those properties will go back on the tax roll and will increase the amount that will be available for the SmartZone.
So — in sort of a tax-free, roundabout way — the Ren Zone will fund the Smart Zone.
“That will start to generate some good revenue for us,” said Shannon.