City of Grand Rapids reports 2021 economic impact

Over $181M in new private investment committed across eight projects bringing 708 new jobs.
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Spectrum Health’s $100 million Center for Innovation and Transformation will be located in the Monroe North neighborhood on the edge of downtown. Courtesy Rockford Construction

(As seen on WZZM TV 13) Grand Rapids had a banner year in 2021 when it comes to business attraction, retention and expansion.

The city of Grand Rapids’ Economic Development Department (EDD) on March 30 reported its overview of programs and impacts for 2021, and Economic Development Director Jeremiah Gracia spoke to the Business Journal about the major highlights ahead of its publication.

The city saw $181,189,556 in new private investment across eight projects — four new and expanding businesses and four real estate projects — which together included a commitment to create 708 new jobs and retain 1,717 existing jobs.

In 2021, the city added $638,237 in new taxes, $144,614 of which was from new property taxes and $493,673 was from new income taxes.

For comparison’s sake, in 2020, the city’s new private investment total was $179,618,441 across 10 projects — six real estate and four new or expanding businesses — with 486 new jobs committed and 401 jobs retained. In 2020, $294,515 in new city taxes was levied, of which $17,484 was new property taxes and $277,031 was new income taxes.

Jeremiah Gracia. Courtesy Robb McCormick Photography

In a video created to accompany the 2021 report, Gracia highlighted three of the projects underway — Blackmer’s $7 million-plus expansion, the $330,000 redevelopment of 1002 Hall St. SE reported here, and the building of the $100 million Spectrum Health Center for Innovation and Transformation — noting the city is focused on making sure it takes care of its own just as much as it is on attracting newcomers.

“One of the key components of the Equitable Economic Development & Mobility Strategic Plan is to make sure that we communicate the resources available to all businesses within the city Grand Rapids,” Gracia said.

“You’ve got to take care of the companies you have — just like anyone who has a business, it’s more important to focus on the current customers than always chasing new ones. And so, the successes of those types of companies that have been here 50, 75, 100 years, are really important for us to be able to remain competitive and an attractive place for new businesses to come.”

Bob Lauson, general manager for Blackmer/PSG Grand Rapids, a Dover company, said the city has focused on making sure companies stay and continue to invest locally “because they want to be here.”

“They’ve made us feel like we’re an important part of the Grand Rapids community,” he said. “The expansion for Blackmer is a really important next step that allows us to remain in this location. We’ve been here for 100 years, (and) perhaps (we’ll be here) the next 100 years. It’s the next generation.”

Isaac Norris, founder and principal of the Isaac V. Norris & Associates architecture firm handling the redevelopment of 1002 Hall St. SE, said the project is going to create space for three small businesses that are “very necessary and helpful to sustain the neighborhood.”

“I think we all have a role to play in showing the next generation what the possibilities are,” he said. “I always like to say that you can’t be what you don’t see, so it’s important that young minority children see Black architects, engineers, doctors, lawyers and even developers that are building up in their community, that we are people who are builders. We should not be associated with tearing down, but we’re builders and we’re creators.”

Tina Freese Decker, president and CEO of Spectrum Health, said she is proud of the Center for Innovation and Transformation project that is taking shape on the north edge of downtown.

“This is an amazingly collaborative and thoughtful process with the city of Grand Rapids,” she said. “We are optimizing the advantages of the Monroe North neighborhood, the Grand River, the businesses, the neighbors and the community to infuse innovation, inclusion and inspiration.”

In addition to the Blackmer, Hall Street and Spectrum projects, the city in 2021 supported the construction of Perrigo’s North American corporate headquarters being built at Michigan State University’s Grand Rapids Innovation Park on downtown Grand Rapids’ Medical Mile; the Victory on Leonard housing project in the former YMCA; MCPc’s new headquarters at Madison Square; Process Engineering & Equipment’s expansion in the Walker View Industrial Park; and a mixed-use development at 730 Leonard St. NW that includes 18 units of housing. (Details of each project are in the chart at the bottom of this story.)

Neighborhoods of Focus

“What’s really notable to point out — it’s not in this report, but should be — is, as we reflected on where those projects are located, (we realized) five of those projects are located in Neighborhoods of Focus,” Gracia said. “If you’re familiar with the city’s strategic plan and our Equitable Economic Development & Mobility Strategic Plan, we’re really focused on driving investments to those Neighborhoods of Focus.”

Neighborhoods of Focus (NOFs) are 17 census tracts in the near west and south sides of Grand Rapids in relation to downtown. Due to systemic and historic inequities, residents in NOFs experience the most disparate outcomes compared to other Grand Rapids census tracts in the areas of income, educational opportunities, homeownership and wealth accumulation.

The 2021 projects in the NOFs are 730 Leonard, Victory on Leonard, Blackmer, Hall Street and MCPc.

Equity impacts

Gracia said the economic development team was pleased that despite not having set a hard-and-fast numbers target in its inclusion plan, the city made $13.2 million in commitments to minority business enterprise (MBE), women-owned business enterprise (WBE) and minority-led business enterprise (MLBE) contractors.

“That’s significant because 2021 was the first year of implementation of our inclusion plan policy, (which) is focused on helping MBE, WBE and MLBE subcontractors with gaining contracting opportunities with the economic development projects we’re doing,” he said.

“We developed this policy in support of our city’s strategic plan and our Equitable Economic Development & Mobility Strategic Plan so that we can start to build in wealth-generating opportunities for those minority-owned businesses in the construction projects that we have receiving incentives through our department.”

Gracia said the city anticipates it likely will hit or exceed that $13.2 million target in 2022 based on the number of projects already in the pipeline.

Affordable housing

Gracia said there is an affordable housing shortfall of about 9,000 units in the city of Grand Rapids at which the EDD is slowly chipping away. The two housing projects it supported last year — 730 Leonard and Victory on Leonard — will contain a total of 137 new units. Since 2016, the city created 1,827 new units, 355 of which were affordable units at 80% of area median income or below.

But to meet the vast need, he said the city continues to need help from the surrounding region.

“The city of Grand Rapids should be contributing to that as the largest urban core, but also we should be looking at our surrounding communities in terms of providing affordable housing units,” he said.

CIA, BID investments

Gracia said he is particularly proud of the various corridor improvement authority (CIA) and business improvement district (BID) investments in 2021.

According to the report, the CIAs approved 24 façade improvement projects totaling $346,383 and 20 murals with a total investment of $87,000. The CIAs and BIDs together made streetscape investments totaling $275,375, which includes street furnishings (bike racks, trash cans, etc.), maintenance and beautification of the right of way, banners and décor.

Together, the CIAs and BIDs invested $708,758 in these improvements.

“Our corridor improvement authorities and business improvement districts are really, really important in driving investments and placemaking in our business neighborhoods,” Gracia said.

The money from the façade grants is given directly to small businesses to enhance their building facades, and many of the CIAs are removing barriers to accessing those dollars by removing the match requirement for the grants, Gracia said.

Southtown Corridor Improvement Authority alone, as of a couple months ago, already had committed over $142,000 for façade grants in its territory for 2022, he added. 

Long-term accomplishments

The second page of the report included incentivized project outcomes from 2016-20 and showed that during that period, the city incentivized 65 projects, completed 51 and had $210 million in projects under construction.

It reported a four-year total of $885,864,590 in new private investments, $795,669,067 in committed private investments and 111% of commitments fulfilled. 

The project development breakdown for 2016-20 was 32 real estate developments; 19 businesses retained, expanded or attracted; and 14 additional projects under development.

The full report is available to view at growgr.grandrapidsmi.gov/news/2021-annual-report.

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BY THE NUMBERS

GR projects supported in 2021

The following numbers are from the project applications filed with the city of Grand Rapids. Some of the estimated investment amounts and job totals have risen in the meantime.

  • Spectrum Health Center for Transformation and Innovation, occupying 710 Monroe Ave. NW and 706 and 725 Bond Ave. NW — $100 million project, 350 new jobs
  • Perrigo corporate headquarters downtown, 400-430 Monroe Ave. NW — $37,632,556 million project, 150 new jobs
  • Victory on Leonard, 900 Leonard St. NW in the former YMCA — $18.6 million project, 10 new jobs, 119 apartments
  • MCPc new headquarters, 1601 Madison Ave. SE — $12.5 million project, to bring 69 existing jobs and create 26 new jobs
  • Blackmer Grand Rapids expansion, 1809 Century Ave. SW — $7.4 million project, 54 new jobs
  • Process Engineering & Equipment Co. in the Walker View Industrial Park — $3 million project, 32 new jobs
  • 730 Leonard St. NW mixed-use development — $1.727 million project, 12 new jobs, 18 housing units
  • Redevelopment of 1002 Hall St. SE to house three small businesses — $330,000 project, six new jobs

Total new private investment = $181,189,556

New jobs committed = 708

Jobs retained = 1,717

Source: City of Grand Rapids and Business Journal research

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