- change ups
City approves six new business investments
Third Coast brings new real estate project to Grand Rapids
Five manufacturers and one development firm got green lights from Grand Rapids city commissioners last week to go ahead with their planned investments. All six, which are spending a total of $10.4 million, will receive tax breaks in return for completing their projects.
“It’s a sign of the recovery in the state of Michigan,” said Mayor George Heartwell. “And we are leading that recovery.”
616 Development plans to spend roughly $4 million to renovate the five-story Kendall Building at 16 Monroe Center into space for retail, office and residential uses. About half of the firm’s investment will go toward making the vacant and dilapidated structure functional. The city has declared the downtown building an obsolete property and said 616 Development’s renovation plan meets the guidelines of the city’s Master Plan. The Kendall was built in 1880 and has been vacant for 40 years.
Based on its $2 million repair budget, the commission’s action will exempt nearly $36,000 a year in property-tax payments for 10 years and allow 616 Development to collect a Michigan Economic Development Corp. community revitalization grant worth up to $550,000. Renovation work is expected to begin later this year.
“I think those of us that go downtown will be happy to see this project. It’s an important project,” said Commissioner Ruth Kelly.
Grand River Aseptic Manufacturing Inc., a life sciences firm at 140 Front Ave. SW that produces sterile and freeze-dried drugs for clinical use, received an eight-year exemption from commissioners for its investment of $3.7 million. GRAM will spend $1.1 million to create additional space at its site, which it leases from Grand Valley State University, and another $2.6 million on new equipment over the next two years.
The company currently employs 19 but plans to add up to 63 new employees when its project is completed. The exemption means it will save nearly $25,000 a year in taxes for the abatement’s duration; the city will gain roughly the same amount in new income taxes from the project.
Commissioners awarded MedDirect Inc. a seven-year personal property exemption for its investment of $1.5 million in office equipment and furniture. MedDirect manages billings and accounts receivables for firms in the medical industry and has clients in all 50 states. The company recently began leasing space at 3855 Sparks Drive NE and is transferring 52 employees from Kentwood to its new location. But more importantly, the company anticipates hiring 200 new employees over the next three years.
The exemption will save MedDirect $73,000 in state and local personal property taxes and the city stands to gain $495,000 in new income-tax revenue over those seven years from the firm’s hiring. The MEDC has also given MedDirect a business-development grant worth about $750,000 for the move and expansion.
Kent Manufacturing Co. also is expanding, adding 29,000 square feet to its new home at 2200 Oak Industrial Drive NE. The company is spending $1.2 million on property improvements and nearly $300,000 for new machinery and equipment over the next two years. Kent Manufacturing plans to add 25 new employees to its staff of 50 through its investment. Commissioners gave the company, which serves the medical, electronic and automotive markets, an eight-year abatement that will save Kent about $15,000 a year in tax payments.
Hansen-Balk Steel Treating Co., which primarily serves automotive, medical and aerospace companies in Michigan and Indiana, plans to spend $682,000 on new machinery and equipment. This investment will mark the sixth the family-owned firm has made since the business opened in 1995. Hansen-Balk Steel is located at 1230 Monroe Ave. NW, will have $5,350 in tax payments abated annually for eight years and will add two new employees from the investment.
Commissioners also gave ABLE Manufacturing Co., perhaps the region’s smallest industrial firm, at 601 Crosby St. NW, an exemption for its investment of $110,000 to install a new horizontal machining center by the end of this year at its current location. The exemption will save ABLE $530 a year in tax payments for eight years; the company will add a part-time machinist to its full-time staff of five.
“This proves that these exemptions are not just for the big players,” said Commissioner Walt Gutowski, who owns Swift Printing Co. and acknowledged that his firm has seen significant growth recently.
On top of those approvals, commissioners will host a public hearing next week Tuesday on the possible redevelopment of the vacant former Miller Zeilstra Lumber Co. structure at 833 Michigan St. NE. Third Coast Development Partners is proposing to invest $5.6 million into renovating that site and a nearby two-story building at 411 Houseman Ave. NE into commercial and office space. Art Express, which specializes in framework, is the sole tenant in the Houseman building.
Third Coast, owned by developers Dave Levitt and Brad Rosely, is asking the city to give the project brownfield status, which would allow the firm to collect up to $434,000 in tax-increment financing for the improvements it makes to the sites. The work will result in 26,800 square feet of useable space, retain 50 full-time jobs and 10 part-time positions, and create 10 full-time jobs and 40 part-time. Third Coast wants to begin construction next month.
Third Coast is largely known for its Mid Towne Village development near the Medical Mile on Michigan Street NE.