Commissioners OK more brownfields
With a month to go in 2010, Grand Rapids city commissioners have approved 13 brownfield requests this year — two more than they ratified in all of 2009.
The 13 projects reportedly will invest a combined $152.2 million in the city and are on the books to create a total of 788 jobs. Those figures come from the city’s Economic Development office. Work hasn’t begun yet on any of the proposed developments.
Commissioners gave the most recent brownfield designations to two projects targeted for downtown sites. The first went to 100 Commerce Development Co. LLC, which plans to invest about $3 million into the four-story, 22,750-square-foot building. The renovation plan includes 1,500 square feet of space on the ground floor for retail and 32 apartments for the three upper levels.
Doug Gulker, a partner in the project and owner of Fusion Properties, said the residential emphasis will be on single bedrooms. But the completed project also will offer some two-bedroom apartments and a few smaller efficiency units. “There is definitely a need for one-bedrooms,” he said.
Of the total $3 million investment, $2 million will be eligible for the Michigan Business Tax credit that comes with the brownfield status. At 20 percent, that credit works out to be $400,000 if the Michigan Economic Growth Authority approves the request before the end of the year. If approval comes after Jan. 1, the credit drops to 15 percent. The building has been vacant for more than a decade, and an analysis of the property showed its soil was contaminated, which makes the project eligible for the tax credits under state law.
“We are hoping to have all of our incentive by the end of the year,” said Gulker. “We hope to start construction in February.”
The Downtown Development Authority is supporting the project with a $50,000 Building Reuse Grant and a tax-increment reimbursement totaling $100,000. The project is expected to generate $8,455 in new taxes for the city each year.
Commissioners gave the second brownfield designation to Grand Rapids Urban Market Holdings LLC, which the Grand Action Committee created with the DDA for the new urban market proposed for 3.5 vacant acres at Ionia Avenue and Wealthy Street SW. The property, which has been declared contaminated, contains two empty warehouses that will be renovated for a year-round food market.
“The project will also include restaurants and other food services, educational facilities, food processing and production facilities, a rooftop greenhouse, and possibly other mixed-use components such as crafts, retail shops, residential units, offices, etc.,” said Kara Wood, city economic development director.
Investment into the project will be at least $27 million and possibly as much as $31 million. Up to 290 new jobs are expected to be created from the development. The development firm, which is a for-profit entity, is seeking an MBT credit worth $5.2 million. The property is expected to be on the tax roll for years and should generate almost $110,000 in new tax revenue in each of those years to the city, which will also receive an estimated $214,000 annually in new income-tax revenue from the project.
The DDA agreed in April to contribute $100,000 for the project’s design. The board also agreed earlier this month to award the development firm a tax-increment reimbursement worth $1.2 million for a number of public improvements planned for the site. Normally, those dollars would go to the DDA.