City Options Lot To BOB

April 1, 2005
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GRAND RAPIDS — City commissioners opted not to have the property appraised again and agreed to sell a three-year option on a city-owned downtown parking lot to 20 Monroe Building Co. last week.

On the same day, commissioners gave Alticor Inc. the green light to build two enclosed walkways that would connect its proposed $70 million hotel to the existing downtown skywalk system.

20 Monroe Building Co., headed by Gregory Gilmore of the Gilmore Collection, wants to expand The BOB entertainment complex at

20 Monroe Ave.
The firm wants to build a performance theater and family-style restaurant on the 11,360-square-foot lot located at
26 Monroe Ave.
, adjacent to the north end of the complex.

The multi-purpose theater would seat 1,200 in a casino-style setting and have a capacity of 1,500 for some events. A boutique hotel also may be part of the development.

Under the option agreement, 20 Monroe has to build a structure of at least 20,000 square feet on the site, invest a minimum of $3 million into the project and complete the project within three years of closing on the transaction.

“If they don’t do that within the three years, they will pay twice the purchase price,” said Richard Wendt, city legal consultant and a partner at Dickinson Wright.

The current purchase price of $498,818 is good until the end of this year. Next year it rises to $513,813, and to $529,262 in the following year.

The lot was appraised nearly three years ago at $39.31 per square foot. The current price is $43.91 per square foot, 11.7 percent more than the 3-year-old appraisal.

The Parking Commission approved the option agreement last month, but recommended that the city get the appraisal updated. Deputy City Manager Eric DeLong said last week the city couldn’t just get an update and would have to have the lot reappraised. Doing that, he said, would cost the city $3,000 and would take four months to do.

The city assessor’s office told DeLong that the value of the lot has risen by 10.7 percent since the June 2002 appraisal. With the lot’s price a point higher than that, DeLong felt another appraisal would be costly for both the city and 20 Monroe. DeLong said having the property reappraised was unnecessary and commissioners agreed.

“We know it’s a buildable site. We haven’t had any other inquiries on it,” said Susan Shannon, city economic development director.

20 Monroe will do due diligence on the site, design a theater to fit the lot’s footprint, and secure financing for the project. The option will cost the firm $10,000 this year, $20,000 to renew it next year, and $50,000 for a third year. Whatever option fees the company pays will be credited to the final purchase price.

Parking Services will operate the lot until a deal is signed. The lot has 25 monthly spaces, six metered spaces, and is worth $72,800 in revenue to the department each year.

As part of Alticor’s new

Campau Avenue
and
Pearl Street
hotel, city commissioners said last week the company could build two enclosed and aboveground walkways.

One will be built from the new 340-room, Marriott-operated hotel to the new hotel’s parking ramp. The other will extend over Campau from the new hotel to the Amway Grand Plaza Hotel parking deck and will connect the new hotel to the skywalk loop that runs from DeVos Place to the Van Andel Arena and includes Alticor’s other downtown hotels, the Amway Grand Plaza and Courtyard by Marriott.

“It’s essential for the hotel project,” said DeLong.

The only element of the 24-story hotel that hasn’t received city approval is the helistop, a landing pad for helicopters, that was designed to be on the roof of the four-story ballroom.

Alticor has plans for a groundbreaking ceremony this summer and the hotel is scheduled to open in September 2007.    

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