Show City The Money

November 22, 2006
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GRAND RAPIDS — If Grand Rapids Development Corp. of Atlanta, Barnes-Stevens Redevelopment of Buffalo, and Moch International of Grand Rapids are dead serious about buying 15.8 acres of city-owned riverfront land, as each appeared to be earlier this year, then the first step they will have to take is to write the city a check for $65,000.

Most of that money, $50,000, will go into an "earnest" account and will be refunded to the firms that aren't selected by the city to buy the Public Works Island at

201 Market Ave. SW
, a site the city has listed for $35 million.

But the remaining $15,000 won't be returned. Instead, the city will use that cash to cover the expenses the city will run up to review responses to the RFP, which city commissioners approved last week. The city promises the RFP process will differ drastically from the call for letters of interest it issued for the property last spring.

"This is where the rubber meets the road — where they've got to give us very detailed, very specific drawings that show us what's going where, tell us what's going where, show us the financing behind the project, how is it going to be phased, and how is it going to connect to downtown," said City Economic Development Director Susan Shannon.

"It's very, very detailed," she added.

The three firms will have until Feb. 23 to get their responses back to the city, seemingly enough time to answer the RFP because the developers have known since late last summer that the RFP was coming. In August, commissioners chose to limit the RFP to the trio that responded to the LOI call rather than follow a steering committee's recommendation to open up the process to any interested party.

"We've been told that it will (be enough time.) We have a consultant onboard now, who does this all the time. And remember, this isn't new to them. They've had their plans and ideas in place through their letters of interest. So this should just be the next step for them," said Shannon

Stainback Public/Private Real Estate, with offices in Houston and Orlando, has helped the city create the lengthy RFP and assured city staff that giving the developers nearly three months to respond was an adequate amount of time. Much of the information that the RFP requires is data the nine-member steering committee said was missing in the letters of interest the firms sent.

Besides the concrete financial data that was missing from all three in the LOIs — because it wasn't required in that process — only Moch International offered specific developments for the island in its response. The proposal included a performing arts center and concert hall, a market and an apartment complex.

Barnes-Stevens reported it would build a mixed-use project on the site, the contents of which would be determined after marketing studies were completed.

GR Development Corp., led by Atlanta businessman Duane Faust, said the project for the island would be part of a larger 36-acre "mystery development" that would be built in that section of downtown. Details of the project for the island weren't revealed and much of the financial data that accompanied the company's letter was kept under wraps by some city officials.

"I've talked to the Mochs because they're local. But I haven't talked to the others, I think, since August when the city commission decided to issue the RFP just to the three of them," said Shannon

Members of the steering committee will review the responses and offer suggestions to commissioners, who are expected to get the RFPs and recommendations in the spring.

Deputy City Manager Eric DeLong reiterated last week that it will likely cost the city nearly $64 million to move from the Public Works Island. And so far, the city's Economic Development Corp. has spent and committed more than $83,000 of the $125,000 that has been allocated to market the property.

"We're definitely interested in it. We've been thinking about it ever since we found out that it was potentially available," Joseph A. Moch, who owns Moch International with his father Joseph W. Moch, told the Business Journal last week.

"But ever since that time, we've been waiting for the city to kind of lead the way and explain what they wanted to do and where they are going with it."    

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