Time runs out on Imperial Metals
While developer Jack Buchanan Jr. continues to fight fraud charges leveled at him and at Joseph Peters by the Michigan Attorney General’s office in the Hanger 42 Studio case, a project he tried for several years to get developed has had its tax abatements revoked.
City commissioners agreed last week to rescind two obsolete property rehabilitation exemptions that were awarded in 2006 to Irish Twins LLC for its renovation of the former Imperial Metals factory at 801 Ionia Ave. NW. Buchanan was the managing partner of Irish Twins and wanted the two-story, 48,000-square-foot building to ultimately resemble the converted factories in New York City’s West Chelsea area.
The plan was to spend $3 million on the property and turn it into office space with a retail component, a courtyard and a water tower to establish a landmark for the Monroe North Business District.
“We really want to enhance an old factory look,” said Buchanan in 2009. “It’s almost like a design-and-build thing. We’re going to blow out the brick and encase it in glass.”
The city’s Parking Services office bought 19,200 square feet on the site two years ago for $640,000 and built a surface parking lot to support the renovation and offer some much need parking for the district.
According to Kent County records, Irish Twins LLC still owns the property. It’s listed as being inactive and not delinquent in taxes. The Irish Twins Group, a predecessor to Irish Twins LLC with Buchanan as a partner, bought the Imperial Metals site in 2005 for a price that was never disclosed. The city said it was $1.2 million.
The agreement Irish Twins LLC had with the city and the state for the exemption certificates required that the project’s construction be completed by June 2008. When it wasn’t, an extension was granted. That extension ran out June 30 of this year.
“To date, there is still no progress being made toward the rehabilitation of any of the facilities. Should a project be undertaken by the current owner or a new owner, a new certificate could be considered,” wrote Kara Wood, city economic development director, in a memo to commissioners. Wood added that the city would let the state know it revoked the exemptions.
The urban market being developed by the Grand Rapids Downtown Development Authority and Grand Action Committee will come before the city commission Sept. 13 for a second public hearing on a brownfield request. The market is planned for 3.5 acres owned by the DDA on Ionia Avenue SW near Wealthy Street. The investment to develop the site could reach $30 million.
But instead of the DDA selling the property for $2.4 million to Grand Rapids Urban Market Holdings LLC as was first planned, the board decided earlier this month to lease the land for 99 years to GRUMH, the urban market’s for-profit developer.
The brownfield tax credits could be worth as much as $5.4 million, based on a $30 million investment. Even though the DDA, a government entity established by the city and the state, owns the property, Wood told the Business Journal that GRUMH still qualifies for the credits.
“The brownfield tax credits go to the entity making the eligible investment, excluding public infrastructure and other TIF eligible activities, so they were applied for and approved for Grand Rapids Urban Market Holdings LLC,” said Wood.
The project is coming before the commission again because the first plan called for renovations of the property’s buildings. The structures were since found to be unstable and will be razed, and new construction will be done on the site. Demolition is set to begin this fall.
The city and the DDA are paying for $4.7 million worth of public improvements to the property and the surrounding streets. DDA members are expected to learn details on the financing package and the lease agreement at their next meeting, which is a day after city commissioners hold the public hearing.