Developer, London Agree To Sale
GRAND RAPIDS — In a manner that places a definitive timeline on the “mystery development” in downtown Grand Rapids, the unidentified developer has signed a 15-day option on the property Mark London is currently renovating into an adult entertainment complex.
Over the past year, the developer, represented by broker Deborah Shurlow of Grubb & Ellis/Paramount, has secretly angled to obtain first-rights-of-refusal on roughly a dozen acres adjacent to 19 acres of city-owned land at 201 Market Ave. NW.
There has been a flurry of excitement since the development was first revealed in the Business Journal last month, and an announcement is expected to come as early as this week.
But the most significant development to date came last week, when two projects key to the development were placed under option — Joel Langlois’ The Intersection nightclub at 133 Grandville Ave. NW and London’s planned Showgirls Galleria strip club and novelty store at 234 Market Ave. NW.
Of particular note is the London agreement, which came with some stiff terms for the developer. Construction on his project will continue throughout the option period until March 23, when the contract expires. The developer’s $100,000 deposit is nonrefundable.
For each day that the deal does not close, the sale price will increase $20,000, roughly the price of construction. London said that he will not sell after the March 23 deadline passes.
“If they don’t close by March 23, the deal’s off; I’ll be in business within a month after that,” he said. “I’m not interested in selling after that point. I’ll be buying stock.”
While the sale price was not revealed, London indicated that he sold it for less than what its appraised value would be — he has invested $3 million into the originally $800,000 property.
“I want everyone to know that they had a choice,” London said. “I think that it’s very critical people know I met their terms. If they walk away, it’s because they don’t mind my being here.”
The developer could have purchased the property for much less had an agreement been reached when London was first approached by Shurlow in 2004. After a series of “low-ball offers,” London said he first received a reasonable offer in January 2005, but the developer was not interested in an outright purchase, only an option.
After a year in flux, negotiations began anew this year, and an agreement was reached on Feb. 21. The property now commanded a much higher price.
“I brought them through and they saw all the work that had taken place,” said London, who still plans to open the club in May. “That’s when they got serious again.”
London initially contacted the Business Journal on Feb. 24 after being told that the developer had been unable to raise the deposit. In an interview on Feb. 28, Shurlow said the deal was still being negotiated.
That day, London signed the sale agreement. He received a check for $100,000 last Thursday, following 15 days of due diligence by the developer. At press time, no closing date had been set.