Construction, Government, and Real Estate

City grants hotel more time to be built

Monroe North project is bigger than first proposed.

July 12, 2013
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City grants hotel more time to be built
Courtesy Downtown Development Authority

When the company first proposed a new hotel for a vacant site in the Monroe North Business District in 2007, the plan was for nine stories, 168 rooms, a 175-space parking deck, and a cost of $28 million to build on the 40,000-square-foot site at Monroe Avenue and Newberry Street.

Last week, Grand Rapids city commissioners extended a development agreement with Hotel Holdings Monroe LLC and unanimously gave the firm an additional year to start and complete the project, which has gotten taller, wider and more expensive to build.

“They’ve expanded the project quite a bit. I guess it’s good that they didn’t build it earlier because it’s better now,” said Commissioner Walt Gutowski.

Father and son Peter and Brian Beukema are partners in Suburban Inns of Rockford, which owns and operates two hotels in Holland and one each in Grandville and Midland. The Beukemas are also principals in the LLC that now wants to build an Embassy Suites with 11 stories, 284 rooms and a 340-space parking structure at a cost of $40 million. The Beukemas have until July 1, 2014, to begin construction and until Dec. 1, 2015, to finish the work.

“The property has been vacant since 2004, and (the project) will be a catalyst for major development in the North Monroe area, providing additional hotel space at a mid-market price range, as well as related facilities, in the downtown area,” said City Economic Development Director Kara Wood.

The related facilities include a café and bar with outdoor seating, a sundries shop and a retail store on the first floor. There is also a reception room with outdoor seating on the second floor that will be open on weekends and offer live music. A banquet facility with an outdoor terrace and a sports-themed bar and grill that also will offer live music are planned for the 11th floor.

The Beukemas will make upgrades to the location by replacing the utilities, adding a snowmelt system, installing new lighting and improving the landscaping.

They told Wood the hotel would create the equivalent of 150 new jobs at an average hourly wage of $11.50.

They estimated the hotel will generate more than $400,000 annually in hotel tax revenue each year for Kent County and more than $300,000 in revenue per year in room-night taxes that will go to Experience Grand Rapids

The Beukemas feel business travelers will be attracted to the site because it is located within walking distance of DeVos Place, the Medical Mile and other downtown attractions. They also believe the two nearby city-owned parks along the riverfront will appeal to guests and that their hotel will complement the district.

The project also came before the city’s Planning Commission last week, largely as a formality. Planners unanimously approved the Beukemas’ request for a special land use designation last month, but after they did so, the city discovered the meeting’s public-hearing notices hadn’t been properly sent.

The city declared the property a brownfield site years ago, and the Beukemas spent $50,000 to demolish the empty and deteriorating building that had housed Western American Mailers. They also provided the city with a $1 million letter-of-credit that was reduced to $950,000 after they razed the building.

The location was in the nearly tax-free Renaissance Zone when they first proposed the hotel in 2007, but the full tax benefits were set to expire in 2008. City commissioners extended the zone’s duration by a dozen years. The site will now be a Renaissance Zone until 2022, and the hotel will reap the full tax benefits through 2019 and then partial benefits for the three following years.

Hotel Holdings Monroe bought the property from Blue Bridge Ventures in August 2007.

The Beukemas have asked the Michigan Strategic Fund for a three-year extension to complete the hotel project in order to collect a state tax credit they applied for years ago. The  Brownfield Redevelopment Authority approved the request last month.

Suburban Inns owns and operates the Holiday Inn Express in Grandville, the Hampton Inn and Sharkee’s Bar and Grill in Holland, the Holiday Express in Holland and the Holiday Inn of Midland.

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