Riverfront Exit Stage Two

August 4, 2006
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GRAND RAPIDS — A few months ago, the city began what it hoped would be a 12-stage process that would lead to the sale of the 16 riverfront acres it owns at 201 Market Ave. SW.

Last week, the city learned that the process may have ended in stage two when a nine-member steering committee recommended that the city remarket the parcel, also known as the Public Works Island. The committee meeting was the second stage in the 12-stage process.

The final decision on what to do will be left up to city commissioners. They could start the process over. Or they could continue the process with the three developers who expressed an interest in purchasing the land that carries a price tag of $35 million.

The steering committee, which was asked to react to letters of intent, agreed that the information they had was insufficient to make any other recommendation. They said the developers mostly presented unacceptable visions of what they would have liked to build on the property, and fell short on experience and evidence that they had the capability to finance their projects.

“I think we should remarket the property,” said committee member David Cassard, also chairman of the Waters Corp.

“I would like to see it opened up to more developers,” said committee member Kayem Dunn, chairwoman of the Downtown Development Authority.

“Maybe we should give it a little more time,” said committee member James White, a 3rd Ward city commissioner.

The committee was disappointed that the city’s call for letters-of-intent drew only three responses, even though the land was marketed nationally.

“I think we should give it a lot of exposure — a lot,” said committee member Samuel Ojo, president of SKO & Associates.

Moch International of Grand Rapids, Grand Rapids Development Corp. of Atlanta, and Barnes-Stevens Redevelopment of Buffalo, N.Y., were the three that answered the call for letters-of-intent. Their reported investments ranged from $150 million up to $2.5 billion, with the latter figure representing 36 acres that GR Development Corp. wants to develop. The city’s property would account for about half of that acreage, and the company didn’t issue an investment figure solely for the city parcel.

Committee member Rick Chapla suggested the city offer more information about the property, if commissioners decide to remarket the land. Chapla, with The Right Place Inc. as a redevelopment specialist, said the city should include its cost to relocate its vehicles from the site and also provide an estimate of the property’s pre-construction cost that a developer would encounter.

“Maybe that would attract more development interest,” he said.

If commissioners decide to start the process over, chances are they will invite the three firms that responded to resubmit, and likely would ask for RFPs and not letters-of-intent. If the steering committee had the financial information usually found in an RFP, they might have arrived at a different decision.

“I think the critical portion is the money, and if it’s not there, then I think we’re spinning our wheels,” said Ojo. “I won’t sleep much at night if we put the city on a bridge to nowhere.”    

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