Electronic engineering firm grows local effort

May 30, 2009
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A local company that develops high-tech embedded software systems and provides engineering services to the aerospace, medical, automotive, consumer electronics and legal industries says it is ready to grow.

In fact, DornerWorks Ltd. wants to double its space and its sales, from $5 million annually to $10 million, and increase its staff from 46 to 66 employees within the next five years by offering its products and services nationally. Those 20 new jobs would come in the embedded software and electronic-hardware engineering fields, and could be filled in as quickly as two years.

DornerWorks has applied to the city of Grand Rapids for an industrial development district, which would abate half the firm’s new property taxes for a dozen years and save the company $8,500 annually. In return for the exemption, the city would receive nearly $9,600 a year in new income-tax revenue from the jobs the firm will create through its expansion. Those positions are expected to pay an average of $23 an hour.

DornerWorks is located at 3445 Lake Eastbrook Blvd. SE and wants to expand on an adjacent parcel. According to City Economic Development Director Kara Wood, the firm plans to invest $705,000 in the project and spend roughly $1.5 million to take its business nationwide.

David Dorner is president, CEO and founder, having started the electronics engineering consulting business in 2000. His brother, Jeffrey Dorner, is vice president of finance and administration; Todd Burghgraef serves as vice president of engineering and technology.

Wood said the state has approved the incentives. The City Commission will hold a public hearing on the request from DornerWorks June 16, the first step of that process here.

City commissioners approved two brownfields last week. One was for TIA2K LLC, a private investment firm comprised of George Larimore and Kent Hildebrand that wants to build a hotel at 45 Ionia Ave. SW, just east of the Van Andel Arena. Larimore and Hildebrand have teamed on the project with Tall House Enterprises, which planned to build a condo tower on the site until the housing market collapsed.

TIA2K plans to invest up to $29 million in the hotel that will include retail space and offer an extended-stay option. The property is a city-run parking lot. The developer won’t receive tax-increment financing from the project because the site is within the Downtown Development Authority district, but will request a Michigan Business Tax Credit from the state for $4.98 million.

Commissioners awarded the other brownfield to Wealthy Street Historical Development LLC for its proposed renovation of a pair of small, two-story, adjacent buildings at 632-636 Wealthy St. SE. Developer Todd Ponstein plans to turn both ground floors into retail space and both upper levels into residential apartments. His proposed investment totals $700,000.

The buildings are in the city’s nearly tax-free Renaissance Zone. Commissioners gave the properties a full, 12-year zone extension last January.

In a somewhat unusual but necessary move, the city terminated eight existing industrial exemptions last week for B&J Die Cutting, Commercial Printing, GLT Packaging, Great Lakes Triad, Integra Printing, Miller Products, National Correct Color and National Printing.

“This is simply a cleaning up of our files. There is no reason to have them on the books,” said Wood of the formality.

The exemptions were awarded by the city and the state between 1995 and 2006, and just one of the properties has a positive taxable value today. The Miller Products site on the city’s northwest side has a taxable value of $418,900, while the seven others were listed at zero.

“They’re either fully depreciated or the properties are not there. A lot of these companies are probably not in business,” said Wood.

The former Miller Products property got its exemption in 2000, but the company closed last year. Wood said Comerica Bank has hired a broker to sell the property, located at Seward Avenue and First Street NW.

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