The Wait Is On

July 10, 2006
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GRAND RAPIDS — Their responses are in, and now all that is left to do for the three firms vying to buy the city-owned Public Works Island is to wait until the steering committee that is evaluating their proposals files its recommendation next month.

Grand Rapids Development, Barnes-Stevens Redevelopment and Moch International are interested in purchasing the 15.8 acres of riverfront land the city said is worth $35 million. Grand Rapids Development wants the parcel for a larger 36-acre mixed-use project, while Barnes-Stevens and Moch International are concentrating their efforts solely on the city land. And the project that Moch would build on the site, should the city sell the land to the Grand Rapids-based firm, would depend on the outcome of at least two feasibility studies.

One study would decide the size of the hotel the company would build there, while the other would dictate the size and contents of the performing arts center that is the key element of the firm’s proposal.

“This pre-architectural feasibility study for the arts I think is crucially important, because it takes a picture of the entire arts community throughout Grand Rapids and West Michigan and really analyzes what their facility needs are. I also think it gives kind of an unbiased, third-party perspective on that,” said Joseph A. Moch, who with his father, Joseph W. Moch, owns Moch International.

Turnaround Arts Management will perform that study, if it goes forward. Turnaround has created long-range business strategies for performing arts centers and theaters in Las Vegas, Austin, Texas, and New Brunswick, N.J. The effort will involve interviewing officials from the arts community to find out what their needs are, and that result will drive the center’s design.

“Putting together these analyses gives you a real clear picture of what is needed. In terms of what to build, that is crucially important, because otherwise you’re just taking a stab in the dark,” said Moch, who added that the report would take about six months to compile.

Moch International has said it is willing to invest about $150 million into the center. If construction becomes a reality, the company wants Pininfarina Studios to design it. Founded in 1930 in Turin, Italy, Pininfarina is best known for designing Alfa Romeo, Peugeot and Ferrari automobiles.

“They have developed quite a world-renowned name and reputation for their designs, and we want to make the building itself a piece of art and an architectural statement. Like with the Van Andel Institute, the architecture of that building has added to its reputation and to the name recognition of the facility,” said Moch.

The hospitality research division of PKF Consulting in Atlanta is on deck to perform the market study for the hotel the Mochs want to build on the site.

“Certainly it’s rational to believe there is a demand and a need for a mid-market hotel downtown. With the Amway (Grand Plaza) and the JW Marriott targeting the upper-end spectrum, I certainly think there is a demographic there for a mid-range hotel. Identifying exactly what that demand is will make a huge difference between (building) a 150-room and a 300-room hotel,” said Moch.

Another piece of the proposal is a 200-unit apartment building, and the Mochs have already done their homework for that project. Multifamily Research Consultants of Dallas looked into the housing market for two downtown projects Moch is building.

“We did a condo study for the Icon on Bond project and an apartment study for The Presidio on Grandville project, so we know those items today and feel very comfortable and confident about the need for apartments — the 200 units that we’ve included in our proposal,” said Moch.

Moch International will have a better handle on debt and equity sources for its project, which also includes a retail market, after the feasibility studies are completed. But the firm does plan to apply for brownfield status for the remediation work that will have to be done to the site, which would deliver tax credits to the company.

The city’s Economic Development Department, which is overseeing the process, has said there won’t be comments coming from City Hall until the steering committee meets again on Aug. 2. After that meeting, the nine-member panel will make its recommendation to city commissioners on what to do with the property.

“We’re just waiting along with everybody else to put our ideas forward,” said Moch.

Should the city sell to Moch International, the company would still need to purchase the NAPA Auto Parts Store at 235 Market Ave. SW, which is due south of the Public Works Island at 201 Market Ave. SW. And Moch doesn’t think that site will come cheaply. Nor does he believe the city will get a bargain on its replacement property to house its vehicles.

“We absolutely have to (buy the NAPA site). The city hasn’t made that very easy by doing this process and by making the announcements that it has. The city will probably have a hard time finding a site to relocate their facility, because everybody who has a piece of property that big inside the city limits is going to know who is coming to knock on their door,” said Moch.

“We will see what happens. But I don’t think that any of the parties developing the site are going to want to leave a NAPA Auto Parts store sitting right smack dab in the center of something. I think that one way or another, that is going to have to go.”    

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