Developer secures brownfield funds
City approves two financing requests for 16-story Bond Avenue project.
City of Grand Rapids officials launched 2016 by supporting the establishment of the 601 Bond Neighborhood Enterprise Zone for the 16-story redevelopment project planned at 601 Bond Ave. NW, and approved a tax increment financing plan to reimburse the developer for up to $4.3 million in eligible brownfield activities.
Kara Wood, economic development director for the city of Grand Rapids, said developer 601 Bond Nassau Dutch John Equities LLC was not only seeking reimbursement for brownfield activities but also seeking approval of a Neighborhood Enterprise Zone along with the Neighbors of Belknap Lookout.
“The residential portion of the project is eligible for the NEZ for a period of up to 12 years,” said Wood. “This project is located in the SmartZone, and that board has recommended this project for consideration because, although they would not capture the taxes levied on the NEZ, they would capture taxes on the commercial portion of the project.”
The designation of an NEZ is intended to promote investment in areas where projects are likely to spur continued development in adjacent neighborhoods. Owners receive tax abatements from rehabilitating existing properties or new construction projects.
Since the property’s soil and groundwater shows a presence of “volatile organic compounds, polynuclear aromatic hydrocarbons and various metals” exceeding the State Generic Residential Cleanup Criteria, the site is eligible for the city’s Brownfield Plan, according to the Jan. 12 city agenda.
The total cost of brownfield eligible activities, such as an environmental site assessment, and including a 15 percent contingency is estimated at more than $4.69 million.
The city-approved proposed amendment to the Brownfield Plan Amendment allows the New York-based developer to receive a reimbursement of $4.3 million for the associated costs to clean up the site through the remaining term of the plan, which ends in 2036.
The New York-based developer proposed a redevelopment project for the site after purchasing the property for nearly $1.2 million from Turing Park LLC in September 2015.
Although the developer initially planned for an approximately 13-story building, revised plans call for a nearly 172-foot, 16-story mixed-use building at a total private investment estimated at $53 million.
The project would include 5,000 square-feet of commercial retail space at the ground level, five floors of ramped parking or 214 parking spaces, and more than 200 market-rate residential apartment units. The construction alone is anticipated to reach $41 million.
Suzanne Schulz, director of the city’s planning department, said although the number of stories now exceeds the zoning ordinance, the height of the building is within the requirements.
“In consultation with legal staff, they determined we would adhere to the feet measurements, since that favors the applicant, which is what the ordinance requires us to do,” said Schulz. “Where there is ambiguity as to which way we are interpreting, we find in favor of the applicant, so I did not need to go to the Board of Zoning Appeals.”
Schulz also indicated the developer is working on revised drawings for the building after concerns regarding parking, screening openings in the parking ramp, and shielding lights due to the proximity of nearby residential units.
“They are well aware of that, and the expectation is we have to do some modifications to the building to soften that look,” said Schulz. “I think it is an interesting side note, though, to note we do not have a public parking facility in North Monroe, so you do see more private development that is likely to go up there wanting to provide their own parking.”
The project is anticipated to have one- and two-bedroom apartments ranging between $1,265 and $1,813 per month, and to contribute nearly $63,192 in new income taxes allocated to the city. The developer also estimates the retail space on the ground floor will generate 10 new jobs with wages of approximately $10 an hour.
The two resolution items were presented during the Jan. 12 Committee of the Whole meeting, which marked the first official meeting presided over by Mayor Rosalynn Bliss and two new commissioner members: Jon O’Connor, representing the First Ward, and David Allen, representing the Third Ward.