Developers Need More Zone Time

September 17, 2007
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GRAND RAPIDS — Peter and Brian Beukema unveiled their plan to build a new hotel in the Monroe North Business District before the city’s Economic Development Project Team last week.

The father and son own three hotels under the Suburban Inns of Rockford banner and want to build their fourth on the southeast corner of Monroe Avenue and Newberry Street, less than a mile north of downtown. The Beukemas bought the 40,000-square-foot parcel last month from Blue Bridge Ventures LLC and are getting ready to ask the City Commission to extend the property’s Renaissance Zone status.

The site, once home to Western American Mailers, was included in the city’s original Ren Zone in 1997, and that designation, which fully exempts most state and local taxes for a dozen years and offers a partial exemption for three years, runs its course in 2012.

“This project meets all the threshold criteria and 10 of the 11 evaluation factors. The 11th doesn’t apply to the project,” said attorney John Byl of Warner Norcross & Judd LLP.

“The use of a Ren Zone here is simpler than going through a brownfield,” he added.

Byl said a brownfield requires more administrative work than a Ren Zone, and he noted that the district’s SmartZone already captures most of the gains in property taxes. Should the city extend the zone for the hotel, the Beukemas would still be required to pay the county’s lodging excise tax that adds 5 percent to every guest’s tab.

The Beukemas said they are willing to invest $28 million in a nine-story hotel that would have 250 rooms, a banquet room that would seat 300, a rooftop restaurant, balconies for the rooms on the west side that face the Grand River, parking for 395 vehicles with 95 of those spaces below ground, and other amenities such as outdoor patios.

Their plan also includes 8,000 square feet of retail space along Monroe Avenue.

“We want to serve the mid-price market,” said Brian Beukema, the son of the father-son ownership team, who defined that market as $139 for a night’s stay.

Peter Beukema told the city that they would make the hotel as environmentally friendly as possible, but would stop short of applying for LEED certification due to budget constraints. He said the plan includes a “green” roof and a number of energy-saving elements. He also said they would upgrade the sewer and water infrastructure situated behind the property.

Byl said the hotel would create 150 new jobs, and employees would earn an average of $11.50 an hour with benefits.

“This project would certainly enhance that part of the city,” said Byl.

The hotel would be located across Monroe Avenue from the city-owned Sixth Street Bridge Park and historic bridge, a setting that Brian Beukema felt would be good for business.

“It’s a great fit for what we do,” he said.

Suburban Inns operates both the Hampton Inn and the Holiday Inn Express in Holland and the Holiday Inn Express in Grandville. The firm has been in the hotel business for 30 years.

The former WAM building needs to be razed and the property needs to be cleaned. Byl said a portion of the building’s roof has collapsed and the site is contaminated with heavy metals and oil.

The Beukemas hope to go before the City Commission next month with their request to extend the property’s zone designation.    

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