On September 20, the City of Kalamazoo Brownfield Redevelopment Authority unanimously voted to move three projects forward:
- The sale of BRA-owned property to Schupan & Sons for the purpose of expanding their facilities
- An Agreement with Hollander Development Corporation for the development of a mixed-used project at 1101 Portage Street
- A Purchase and Sale Agreement with Harrison Circle LDHA LP (NOMI Developers, LLC) for the development of a mixed-use project on vacant parcels at 525 and 535 Ransom Street and 617 Harrison Street.
Brownfield Redevelopment Authority, Agenda Packet, September 20, 2018
Harrison Circle Building
City staff has been working with NOMI Developers, LLC (Developer) on a mixed use project on the vacant parcels owned by the City of Kalamazoo Brownfield Redevelopment Authority at 525 and 535 E Ransom, and 617 Harrison Street. The attached Brownfield Purchase and Sale Agreement (Agreement) was negotiated with the Developer’s attorneys to ensure the terms within the agreement meet the standards required for MSHDA Low Income Housing Tax Credit (LIHTC)* application. The total purchase price for the properties mentioned shall be $130,000.00 with a required $5000.00 deposit.
This would be NOMI Developers’ fourth project built on Brownfield Redevelopment Authority land in the Rivers Edge District at the northwest corner of the roundabout at Ransom and Harrison streets. The developer has invested over $10,000,000 in the Rivers Edge District and the proposed Harrison Circle Building will bring an additional $13,000,000 to $15,000,000 investment along with the potential of two food related businesses.
This new project, Harrison Circle Building, will be a mixed use development. It will consist of potentially two food-related businesses totaling 5,000 square feet and 80 apartments. The apartments will be a mix of LIHTC, Workforce and market rate housing. This approach continues NOMI’s commitment to building a community where people of all walks of life are able to live work and play.
The project will have 80 residential units. Of the 80 units, 64 will be Tenant Area Median Income (AMI) Restricted MSHDA Project Based. This translates into 16 one-bedroom units at 30% AMI with a monthly rent of $313.00; 11 one-bedroom units and 1 two-bedroom unit at 40% AMI with a monthly rent of $443.00 and $530.00 respectively; 15 one-bedroom units and 1 two-bedroom unit at 60% AMI with a monthly rent of $662.00 and $794.00 respectively; 19 one-bedroom units and 1 two-bedroom unit at 80% AMI (Workforce Housing) with a monthly rent of $959.00 and $1150 respectively. There will be 15 one-bedroom units and 1 two-bedroom unit at Market Rate with a monthly rent of $1000.00 and $1500.00 respectively. This project will add much needed Affordable Housing to this up and coming area.
*For purposes of the PILOT and the LIHTC application, Developer established Harrison Circle LDHA L.P., an organization formed to secure Low Income Housing Tax Credits and mortgage financing through the Michigan State Housing Development Authority. Therefore, the attached Agreement is with Harrison Circle LDHA LP with Developer agreeing to fulfill its terms.
The Creamery Project
City staff has been working with Hollander Development Company on a mixed use project on the vacant parcel owned by the Kalamazoo County Land Bank at 1101 Portage Street. The attached Brownfield Plan Development Agreement highlights the complexities of the project by providing affordable housing for 29 of the 48 rental units for which Developer will pay the City a PILOT as approved by the City Commission on August 20th.*
Since the project addresses many needs the City has targeted, further assistance through the capture of tax increment revenues is needed. Therefore, in order for that portion of the project to qualify for TIF, Developer will establish a condominium subdivision for the remaining residential units and commercial spaces – broken down as: (i) 19 market-rate units; (ii) approximately 5800 square feet dedicated for a 24-hour drop in childcare facility; and (iii) approximately 2400 square feet of leasable commercial space. Other key features of the project include indoor bicycle parking, rooftop green space, on-site solar energy and space for public art with the goal to qualify the project as LEED Platinum.
The Agreement covers 16 years with estimated costs for the eligible activities at $ 676,586.
*For purposes of the PILOT, Developer established Kalamazoo Creamery Limited Dividend Housing Association Limited Partnership (Creamery LP), an organization formed to secure Low Income Housing Tax Credits and mortgage financing through the Michigan State Housing Development Authority. Therefore, the attached Agreement may be with Creamery LP with Developer agreeing to fulfill its terms.
4233 Davis Creek Court and 3603 Kilgore Road, Schupan & Sons, Inc.
In 1999 BRA acquired under a quit claim deed from the City vacant approximate 6.8 acres and 0.482 acre parcels of real property with frontage on Davis Creek Court and Kilgore Road, respectively, in the City of Kalamazoo. Schupan owns a manufacturing/recycling facility located at 4200 Davis Creek Court, which abuts the Brownfield Property. Schupan has plans to expand the operations it conducts at their existing location, and its purchase of the Brownfield Property will benefit its expansion plans by utilizing the BRA Parcels for storm water management.
The planned project involves: (i) an addition of approximately 40,000 square feet to the existing building; (ii) landscaping and site improvements to the parking areas on the Schupan Parcel; and (ii) construction of the storm water management system.
With Davis Creek bisecting the 4233 Davis Creek Court Property most of the 6.8 acres is not separately developable. And with the expansion Schupan will create additional well-paying manufacturing jobs. Taken both these factors into account were considered by staff in negotiating the $10,000 sale price.
The Agreement covers 25 years with estimated costs for the eligible activities at $800,000. And this project will require an amendment to the Revised Brownfield Plan as new chapter 52, among other amendments/additional chapters covered in a separate memo.