City May Leave Market

January 13, 2006
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GRAND RAPIDS — Another city-owned piece of downtown may be up for sale soon, and this time it would be prime riverfront property near the U.S. 131 Market Street exit.

Following the sale of the former City Centre parking ramp, commissioners voted last week to have 19 acres of city-owned land at 201 Market Ave. SW appraised. The parcel, just south of Van Andel Arena, is known as the Public Works Island and is home to the Parks and Recreation Department, the Streets and Sanitation Department, and the Computer Center.

Deputy City Manager Eric DeLong told commissioners the city has received a number of inquiries about the property. He said selling the parcel to a private developer would create jobs or attract new residents, depending on the type of development. In either case, DeLong said, a development on the riverfront parcel would generate from $300,000 to $400,000 in new tax revenue each year.

“We think this is a prime parcel to market at this time,” he told commissioners.

But commissioners didn’t give DeLong the go-ahead he requested, which would have included issuing a request-for-proposals for the property. Instead, they agreed to have the parcel appraised to determine its sale value, to find a consultant to help with the effort, and to review a list of potential sites that could contain the departments which would have to relocate.

“You’re going to have to move street sweepers and snow plows,” said Rick Tormala, 2nd Ward Commissioner.

Tormala joined 1st Ward Commissioner James Jendraisiak in wanting to see a relocation site that could handle all the giant trucks and road salt before giving a green light to a call for proposals. But 3rd Ward Commissioner James White had a different take on the matter.

“I see this as a way to put people to work,” said White of a new project going up on the site. “I also see this as future tax revenue to fund our ongoing services. To use riverfront property to park trucks is not a good use.”

DeLong, White and Economic Development Director Susan Shannon are meeting with the Michigan Economic Development Corp. on Wednesday to further develop a sales plan and to try to enlist some state funding for things such as having the property appraised, surveyed and marketed. If the development corporation does agree to finance all or a portion of those services, the city would repay the state agency from the sale’s proceeds.

DeLong pegged the initial cost to get the property ready for sale at $100,000. He also said he knew of several sites that could handle the relocated departments, but he didn’t want to identify any at this time.

City commissioners will have the final say on a sale, which wouldn’t include the “real” island that actually sits on the Grand River just west of the Public Service Island.

DeLong said relocation costs would be paid by proceeds from the sale and by brownfield tax credits generated from the private development. That funding process is similar to the one Gallium Group LLC first put forth three years ago in its failed attempt to buy City Hall and Calder Plaza for a new hotel. And like that project, this one involves finding a new home for some city services.

A comparable RFP method was used to sell the 37,000-square-foot City Centre ramp site at Division Avenue and Fulton Street last November for $2 million to Two West Fulton.

Mayor George Heartwell called the public works island “the most attractive piece for development to capitalize on downtown.”

“The parcel has enormous potential for redevelopment,” he said. “We have a phenomenal opportunity here and the time couldn’t be better.”   

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