Grand Rapids Area Black Businesses is investing half a million dollars to flip a building on Eastern Avenue SE into a center for entrepreneurship and development for Black-owned businesses.
The Grand Rapids City Commission held a public hearing to consider an application from GRABB for an obsolete property rehabilitation exemption certificate, as well as the establishment of an obsolete property rehabilitation district for the project, located at 2012 Eastern Ave. SE.
GRABB owns the property and plans to rehabilitate the obsolete building for commercial use.
The single-story, 4,410-square-foot structure was originally constructed in 1950 and is currently vacant. The city assessor inspected the building on May 27 and determined it meets the definition of “functionally obsolete,” as defined by Public Act 146 of 2000, and will require significant investment and rehabilitation prior to future use.
The plan for rehabilitation includes renovation of both the interior and exterior to accommodate a retail space and a business incubator. The incubator space will include affordable co-working and meeting space and will offer important resources for businesses and entrepreneurs in the community.
GRABB expects to invest $500,000 in the rehabilitation project, $450,000 of which includes hard construction costs. Once complete, the project is anticipated to result in the creation of four full-time equivalent jobs with average wages of $20 per hour. The proposed exemption will assist GRABB in transforming a vacant and unusable property into “District 2012,” a commercial building that will serve as a center of entrepreneurship, innovation and business development for Black-owned businesses.
The organization also is working toward the following subcontractor participation goals in connection with the project for Micro-Local Business Enterprises (MLBEs), Women-Owned Business Enterprises (WBE), and Minority-Owned Business Enterprises (MBE) in construction: 70% MBE, 2% WBE and 3% MLBE.
Additionally, the applicant plans to utilize 90% MLBE subcontractors for professional service expenses in support of the project. These levels of participation would amount to 76.5%, or approximately $382,500, of the overall project costs.
The project meets multiple objectives of the city’s strategic plan and equitable economic development and mobility strategic plan, including:
- Supporting the creation, retention and growth of business, specifically minority and locally owned businesses.
- Increasing the number and diversity of developers, property owners, and businesses participating in economic development programs.
- Creating employment opportunities in the Neighborhoods of Focus (NOF).
- Prioritization of MBE, WBE and MLBE subcontractors for projects supported by city incentives.
Grand Rapids Economic Development Director Jeremiah Gracia previously told the Business Journal developers are encouraged to have a certain percentage WBE, MBE and MLBE participation through contractors, service providers and the like.
While the EDD puts the expectation on the contractor — and the business — to on-board WBE, MBE and MLBE subcontractors, legally, the office can’t enforce a certain percentage of participation in these areas for any incentives to be available. It is, however, highly encouraged, because the EDD will report those levels of participation in its evaluation and public presentation.
The project is permitted in the current zone district and aligns with the Southtown Business Area Specific Plan (BASP) future land use map, which labels the property as located in a Traditional Business Area (TBA). Additionally, the property is included in the Seymour Square priority investment area in the BASP.
GRABB also received approval from the Southtown Corridor Improvement Authority (CIA) for a $45,000 reimbursement grant through the Third Ward Business Retention Incentive Program on Sep. 16, 2020.
The project recently received support from the Garfield Park Neighborhoods Association, the Alger Heights Business Association and board members of the Southtown CIA. It was presented to the Economic Development Project Team at its meeting on July 13.
GRABB did not immediately respond to requests for an interview at press time.