Avastar Unit 5 on market again
A mystery still lingers around the cavernous Unit 5 of the Avastar industrial park at 2150 Alpine Ave. in Walker, the largest segment of a former GM plant that was tentatively known last year as Hangar42, an erstwhile movie studio.
The Wisinski Group has announced that Unit 5 is on the market again. It is a 307,632-square-foot property that includes a renovated factory floor of 263,947 square feet. Wisinski, represented by Stu Kingma, is marketing the space for manufacturing or warehousing at an asking price of $7.5 million.
Last fall, after the earlier proposal to turn it into a movie studio that would have received state tax credits began falling apart, a group from Los Angeles called SHM Partners/Fifty-Fifty Entertainment approached Walker city officials to express interest in acquiring Unit 5 for development into a movie production center with a studio and office space.
Calls to SHM executive Steve Smith have not been returned. However, John C. Buchanan told the Business Journal that Smith and his partners “really had a big interest in it but apparently they could not get financing they needed to buy it.”
“I hear rumblings that they are still interested in trying to do something – they’d like to have it,” said Buchanan. “But that deal we had in discussions last fall has not materialized. So right now, those negotiations and discussions are really not going forward, until they can” obtain financing.
Walker City Manager Cathy Vander Meulen said she last had contact several weeks ago with Global X, a tax credit financing consulting firm that has represented SHM Partners/Fifty-Fifty Entertainment. She was unable to reach Global X last week.
Walker Mayor Rob VerHeulen said he does not know if SHM/Fifty-Fifty Entertainment still has an interest in acquiring Unit 5. VerHeulen noted that when city officials met with Global X last fall, “part of their model was keyed on film industry credits” for investment in studio infrastructure.
“In the back of my head I was thinking, well, what happens if the film credits go away?” said VerHeulen.
Kingma told the Business Journal that actor Curtis “50 Cent” Jackson and producer Randall Emmett also had expressed an interest in Unit 5. The two launched a production company in Grand Rapids in 2009 called Cheetah Vision, which has filmed four movies in West Michigan.
Last week Gov. Snyder proposed an annual $25 million cap on the total amount of production tax credits for movie makers, while about $65 million in potential credits have accumulated over the last six months. But those are movie production incentives; it is not clear what the future impact might be on the movie studio infrastructure tax credit.
VerHeulen also mentioned the negative publicity that began coming out last summer from the Hangar42 proposal, in which it was allegedly going to be sold for $40 million to a former Steelcase executive who headed a group that was supposedly going to turn it into a movie studio. At $40 million, that would have qualified the developers for a $10 million transferrable tax credit.
Both Unit 4 and Unit 5 had been on the market previously for less than $10 million total. (Unit 4 was recently sold to Kentwood Packaging for slightly less than $2.5 million.) Two individuals involved with the Hangar42 deal have been indicted for allegedly attempting to defraud the state government on the film studio incentive.
VerHeulen said when he spoke to Global X representatives prior to November, he noted that “if nothing else, there would be some scrutiny on these things” as a result of the negative publicity, “and they said, ‘Well, obviously the package looks more attractive with film credits.’ But they said, ‘We think we can put it all together even if film credits are curtailed somewhat.’”
Kingma said the open factory part of Unit 5 is unusual in that the distance between the columns is 100 feet from east to west and 25 feet from north to south.
“You could do a lot of things in here,” said Kingma.
He said there are “lots” of buildings available in the area for use as warehouse space, but when the focus is put on heavy manufacturing facilities, “the choices get pretty slim.”
The property was sold by automotive parts maker Lear to Alpinist Endeavors in 2006, according to Kingma, at which point a creosoted-wood floor was removed and a heavy-duty concrete floor was installed. The space was then leased temporarily by Amstor in 2007.
A little over a year ago, a new wireless-controlled overhead lighting system was installed, which reportedly enhanced its intended use as the Hangar42 movie studio. Scenes from at least one action film were shot inside the vacant building in the past year.
The property is in a Renaissance Zone and will be free of most state taxes for about another 10 years.