GRAND RAPIDS — City commissioners should get their first look at the most expensive per-space parking ramp in the city’s history in two weeks, and it’s the same price the city has agreed to pay for spaces in a proposed privately owned downtown ramp.
A new city-owned parking ramp planned for the northwest corner of
in the Heartside Business District carries a price tag of $27,000 per space. The total cost for the six-story structure with 318 spaces is expected to reach $9.4 million, with $950,000 of that amount to be spent on acquiring the almost half-acre of land the ramp will occupy. The price includes all development and pre-construction fees.
But the city has agreed to buy 149 spaces for $4 million, or a per-space price of $27,000, from Two West Fulton as part of its mixed-use development planned for the former City Centre ramp site at
. RSC Associates of Chicago and Second Story Properties of Grand Rapids make up Two West Fulton.
The most the city previously paid for a space was $21,000 in the
. The city, though, already owned that parcel so acquiring land wasn’t part of the price.
Parking Services Director Pam Ritsema said if the city had bought the property for the
The city would purchase the property from Cherry Street JV LLC, a partnership of Rockford Companies and RDV Corp. The city will pay $46 a square foot for the parcel that measures 20,576 square feet.
At first the city and Cherry Street JV were going to build the ramp together, but Ritsema reported that both sides believed the city would feel more comfortable with the project if the city managed it by itself.
“In our taking it over, it will lower the cost [to build] because we can borrow money for less,” said Ritsema.
City CFO Scott Buhrer said Parking Services has enough working capital to make the investment. That account has close to $6 million in it and Buhrer said $2 million could be used for expansion. Most likely the department will pay cash for 25 percent of it and borrow the rest through municipal bonds. Buhrer thought Parking Services would end up paying an interest rate ranging from 5.5 percent to 5.75 percent on the bonds.
“By and large, it’s a pretty stable organization,” said Buhrer of Parking Services.
The city’s building authority is reviewing the project’s financials this week.
Ritsema said the biggest question concerning the ramp is whether it will be filled when it opens; early returns show it will.
As of last week, 283 of the 318 spaces have been spoken for on a monthly basis. Monthly parkers are likely to pay $110, which is less than what the city charges at its other downtown ramps. Ritsema said the fee should be lower because parkers in Heartside have routinely paid $45 a month for surface parking.
In addition, the ramp’s location isn’t that far from Van Andel Arena and it should rake in a decent revenue number from events held in the building.
“If the ramp is full and is used for event parking, at $110 a month that should cover debt service, operations and maintenance,” said Ritsema.
Buhrer projected revenue from the ramp should be around $700,000 in its first full fiscal year, while operating expenses should reach about $225,000. He said the department needs $60 each month to operate and maintain a ramp space.
Ritsema said she hopes construction will begin in November and that the ramp will open the following November. Design Plus and Walker Parking Consultants are on board for the project. The city will take construction bids, if commissioners approve the project. They are expected to review it on Aug. 1. Parking commissioners approved it last week.
The Heartside Business District needs the parking because of the business growth in the area and because the district lost its largest source of parking when the city razed the City Centre ramp at
and then offered the property to RSC Associates of Chicago and Second Story Properties of Grand Rapids.
Parking Commission Chairman Jack Hoffman acknowledged that the per-space cost in the new ramp was “steep,” and that he had hoped to keep it lower through a joint venture with Rockford Companies.
“We tried a partnership with