Economic Development, Government, and Real Estate

City approves unique parcel agreement for repair shop

Officials get creative when faced with parcels divided by an alley and CID boundaries.

January 15, 2016
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Four parcels, three business districts, two corridor improvement districts and one alley — all tied to one business — presented quite the story problem for city officials.

Due to a location technicality and a public alley, RJZ Land Holdings LLC sought approval to encumber all four properties at 846 E. Fulton St. as part of a condition of approval for the expansion of the existing company on the site and to prevent a separate sale or transfer in the future.

Community Automotive Repair is located on the four separate parcels of property bisected by the public alley and recently completed a two-story expansion project. As part of the expansion, the city previously had approved the rezoning of two residential properties to mixed-use commercial, and the Planning Commission approved a Special Land Use for the separate parcels with a request the parcels and vacated alley be consolidated into a single property.

City staff ultimately agreed to allow the four properties to be combined into two new parcels of property since the alley divided two properties to the east and two properties to the west.

When the Special Land Combination Application was submitted to the city, however, there was a snag.

During last week’s Committee of the Whole meeting, Suzanne Schulz, director of the city’s planning department, said it is a really confusing situation, despite the straightforward request.

“In the case of Community Automotive, they had the alley bisecting four parcels,” said Schulz. “We tried to require that they combine, and … as they were working through the process to do that, it was discovered the two front parcels fronting Fulton are in the Uptown CID and the back two are not.”

The Uptown CID, which is designed to support economic development and revitalization in the commercial district, includes properties fronting Lake Drive, Wealthy Street, Fulton Street and Cherry Street in the East Hills, Eastown and Fulton Heights business districts.

After a discussion on how to merge the parcels and whether it was necessary to revise the CID, city staff and the business owner’s attorney decided the easiest way to resolve the issue was a legal agreement encompassing all four properties.

The agreement would prevent current and future owners from selling or transferring each parcel individually, and essentially would accomplish the same purpose intended by the lot combination, according to a Jan. 12 city agenda memo.

“What we typically do through the planning approval process is require the parcels be combined because, over time — and we saw this with the foreclosure crisis — you might see a business with a parking lot next to it, and it is two separate parcels,” said Schulz. “They were auctioned separately so now they have different owners.”

The legal agreement, or Declaration of Restrictive Covenant, is between Ada-based limited liability company RJZ Land Holdings and the city of Grand Rapids. Through the agreement, the company agrees it shall not “individually give, sell, devise, transfer, or convey any one of the four parcels of property” unless it is sold or transferred as a single property.

The agreement is effective upon recording with the Kent County Register of Deeds until July 1, 2035, when it will automatically be extended for an additional 10 years, unless both parties agree to a change in the agreement.

“Basically, all this does by accepting this, is we are going to record it and have it formalized that these parcels are joined in some way,” said Schulz. “It is not our typical way of doing that, but they are joined in essence as one parcel so we don’t have problems in the future.”

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