Cherry Street draws attention of Locus

May 7, 2010
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John Green and Andy Winkel, partners in Locus Development, have put together a two-phase plan to commercially redevelop an acre of vacant property on the southeast side of Grand Rapids in the city’s East Hills business district.

The first phase consists of renovating three empty buildings along the Cherry Street and Lake Drive corridor into a mixed-use, LEED-certified development totaling 15,000 square feet. The project’s key renovation will be made to the building at 925 Cherry St. SE. While Spectrum Health most recently owned and operated it as a child care center, Locus will turn that space and a nearby structure into a new microbrewery and pub.

“We’re excited for the chance to create a new destination in the East Hills neighborhood. We feel the proposed concept demonstrates a responsible approach to building upon the existing fabric of the neighborhood,” said Winkel, whose firm is investing $3 million into the project.

Brewery Vivant is the name of the new microbrewery. It’s owned by Jason Spaulding, the former owner and co-founder of the New Holland Brewing Co. Spaulding plans to lease 9,200 square feet of space across two of the buildings — at 925 and 930 Cherry St. — and open the Belgian- and French-inspired brewery and a 140-seat taproom this fall.

“The area has such a great vibe with forward-thinking businesses like Marie Catrib’s, Green Well, Corez and Gaia. I cannot imagine a better place to locate the brewery. I look forward to adding another layer of depth to an already outstanding neighborhood business district,” said Spaulding, who added that he intends to buy most of the necessary ingredients for his business from local sources.

Spaulding will brew and package his beer at 930 Cherry St., while the pub and its outdoor seating area will be at 925 Cherry St. The city is helping Locus and Spaulding to create an obsolete property rehab district for the project and an industrial development district for the microbrewery.

“The investment in real and personal property will be significant for this currently vacant property,” said Kara Wood, city economic development director.

“In addition, the project will increase the city’s long-term tax base and place the existing vacant buildings into productive use,” she added.

The production facility for Brewery Vivant will account for about 5,200 square feet of the total space Spaulding will lease. The rest will be used for the taproom and restaurant. The business is expected to create up to 40 new jobs with wages ranging from $8 to $17 an hour. Winkel said he and Green are not equity partners in Brewery Vivant.

“We are ‘partners’ in the sense that the success of our real estate developments is largely tied to the success of our tenants, in this case Brewery Vivant,” said Winkel, who added that Spaulding impressed him and Green with his business plan.

“Not only does Jason have a passion for creating unique beer and food, he has a wealth of experience behind him and an extremely well-designed business plan that will serve as his own operating model going forward,” Winkel said.

“While we feel like we set the bar high for any operator that might become part of a project, it’s not too often that we come across an operator as well prepared as Jason. We were also drawn to the fact that the brewery is a great fit for the existing buildings on the site and that it’s complementary to the East Hills neighborhood,” he added.

When asked whether he thought the timing was right to open a new microbrewery considering the current economy, Winkel said the data show it is. Last fall, when Locus and Spaulding decided to work together, sales for the nation’s overall beer industry were down by 1.5 percent over the first six months of 2009. But that figure was much more encouraging for the craft-brewing industry, which Brewery Vivant will join. Sales of craft beers were up by 9 percent over that same six-month period last year. In addition, the volume brewed by craft brewers grew by 5 percent nationally during that time.

“I think these figures are a testament to the fact that consumers, more so than ever, are looking for a unique experience that’s highly differentiated from the ‘same old, same old’ they can get anywhere,” said Winkel. “The initial reaction from the community has been overwhelmingly positive.”

Green and Winkel are familiar with microbreweries as Founders Brewing Co. set up its taproom and production facility on Locus property at 235 Grandville Ave. SW. Green has become an equity partner in Founders and is helping the business with its next expansion plan.

Winkel said Locus is speaking with other potential tenants. At this point in those conversations, he said it was likely that the remaining Cherry Street space would be leased by retailers. M Retail is the project’s commercial retail broker. Cornerstone Architects has been signed to design the renovation, and Orion Construction will manage the work.

Locus hopes to have the first phase finished by fall. “But we don’t want to get ahead of ourselves, so we’re taking an appropriate pace with this project,” said Winkel. The project’s second phase has Locus looking at putting up two new buildings and renovating a former residential structure on the property into two one-bedroom units and one four-bedroom unit, once work on the first-phase is completed.

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