City and Rockford agree on land purchase option
Development firm has exclusive rights to city-owned land near downtown.
The city of Grand Rapids entered into a two-year property purchase agreement last week with Rockford Development LLC for a one-acre parcel on the near southwest side, not far from the downtown campus of Grand Valley State University.
The option is for a city-owned vacant parcel at 30 Lexington Ave. SW, just south of Fulton Street and just east of Seward Avenue. Rockford Development will pay the city $50,000 for the exclusive rights to the property in the option’s first year and $75,000 for a second year.
“The option period allows them to go through their financials and the schematics. They intend to work with the neighborhood and business associations,” said Kara Wood, city economic development director.
The city obtained the property when it extended Seward from Fulton to Butterworth streets several years ago and listed the parcel for sale over a 30-day period from late August until late September.
“This is the only proposal we received from the listing,” said Wood.
The property is listed for sale at nearly $1.63 million. If Rockford Development goes through with a transaction, a portion of its option payment — the amount left after the city recoups its costs for offering the site — will be applied to the purchase price. Rockford would also pay the closing costs.
Then Rockford will have to enter into a development agreement with the city for the property. The city would like to see a mixed-use office development of at least 60,000 square feet built on the parcel and a minimum investment of $7.5 million, which doesn’t include the purchase price.
The option agreement also allows for a residential use and requires Rockford to maintain the parcel during the option period.
If a development agreement is reached, Rockford would have to put $200,000 into an escrow account as a completion guaranty.
“We have already seen a significant positive impact with what they’ve already done on the west side,” said Commissioner Walt Gutowski, whose district covers that section of the city, of the company’s actions there.
Rockford recently opened its new headquarters at 601 First St. NW at the corner of Seward Avenue, and has begun clearing the property at Douglas Street and Seward for a new four-building apartment complex.
Commissioner David Shaffer, who also represents the city’s west side, said the option agreement was a good example of how infrastructure improvements made by the city can lead to economic development efforts from the private sector.
“All of us have to work together to continue the development of our city,” said Commissioner James White.