Third time is a charm
Three strikes don’t always result in an out. At least not for Irish Twins III LCC and the firm’s planned renovation of the former Imperial Metals building at 801 Ionia Ave. NW.
The third, and likely final, proposed term sheet to sell a portion of the project’s property to Parking Services was unanimously approved by city commissioners last week.
If all the terms are met, Irish Twins III will enter into a purchase agreement with Parking Services for a 28,100-square-foot parcel along Ionia Avenue, where the city department will construct an 81-space surface lot to support the development.
The square-foot price is $32.80, the appraised value, which means Parking Services will pay roughly $921,680 for the site.
The initial agreement had Parking Services buying two parcels for a total of 48,787 square feet at a price of $1.6 million. But when city commissioners expressed a lack of confidence that Irish Twins III had the financial resources to go forward with the project, they told Ritsema to negotiate a deal for the smaller of the two parcels on Ottawa Avenue. So the second proposed term sheet was for 19,200 square feet at an estimated price of $640,000.
“We will continue to receive brownfield revenues and tax-increment revenues to pay for the cost of parking,” said Ritsema of two contract clauses she has held on to throughout each version of the term sheet. The new contract releases the city from buying the second parcel.
When asked why she wanted her department to buy the larger of the two parcels, Ritsema said the engineers she spoke with preferred the Ionia site because it is easier to build a lot there than on the lower-level Ottawa parcel. She also said the Ionia property has a better footprint for a ramp, in case the Monroe North Business District ever needs one.
As for Irish Twins III, the firm has to provide the city with an $80,000 letter-of-credit, a title insurance commitment and a survey of the property by June 1. The firm also has to provide a letter-of-credit equal to the amount of the lot’s annual parking revenue for three years, buy 25 monthly parking passes at market rate for three years, and create a project with a taxable value of not less than $2.87 million.
Ritsema told commissioners that she was always conscious of minimizing the city’s risk in the deal and came up with a Plan B in case Irish Twins III couldn’t meet the terms. She said she spoke with building owners on Michigan Street about using the lot as a possible home base for DASH North, a new park-and-ride shuttle service that could serve Monroe North and the “Medical Mile.”
“But I do believe that in three to five years, the building will be built and tenants will be in there,” said Ritsema of the proposed project.
Ritsema said the city should be a patient investor. By that she meant if public money goes in first, then private dollars will eventually follow.
“We shouldn’t be cavalier with parking funds,” she said. “But we know that parking leads to economic development.”
City Commissioners Elias Lumpkins and Walt Gutowski praised Ritsema for staying with the agreement, overcoming the commission’s objections and making it a reality.
“I think she has stayed on top of this entire development,” said Lumpkins.
Irish Twins III, headed by developer Jack Buchanan, plans to renovate the former factory into 40,000 square feet of office and retail space.
Irish Twins Group, the first LLC formed for the project, owns the property.