MUSKEGON, MI – With approval from the city of Muskegon for a 70-lot, $12 million residential development on Muskegon Lake in hand, developer Jon Rooks is beginning the details of putting the waterfront neighborhood together.
The 11-acre site on the end of the Terrace Point property that includes the Shoreline Inn and Conference Center was once home to the historic Continental Motors plant, which left an environmental contamination issue.
Rooks and his Terrace Point Landing LLC have asked to be included in the city’s Brownfield Redevelopment Authority plan. Inclusion would offer the residential developer up to $2 million in property-tx captured dollars to complete an environmental assessment, cleanup activities and installation of roads and utilities.
Terrace Point Landing plans have progressed to potentially having home construction under way in the spring of 2014, Rooks said.
“We’d like to get started this fall on the environmental and infrastructure and finish that in the spring,” Rooks told the authority board members, adding that much of the project’s timetable will depend upon the environmental assessment and permit process through the Michigan Department of Environmental Quality.
The Muskegon Brownfield Redevelopment Authority began the process Tuesday of assisting Terrace Point Landing in securing the locally-generated environmental assistance. The authority board, which also sits as the Muskegon Downtown Authority, unanimously approved a unique arrangement in creating a tax increment financing district for Terrace Point Landing.
The brownfield redevelopment plan now goes to the Muskegon City Commission, which is expected to set a public hearing on the plan for May 14. The city commission must provide a final approval for Terrace Point Landing to be included in the city’s brownfield redevelopment plan.
“The site is contaminated and there will need ot be remediation of that,” according to Terrace Point attorney Jared Belka of Warner Norcross and Judd.
Complicating the city’s attempt to assist Terrace Point Landing with its environmental issues is the fact that the property is also in the Muskegon Downtown Development Authority district, which already captures property tax increments to support downtown development and promotion.
Rooks and city officials have come to an agreement that is spelled out in a DDA plan amendment and Terrace Point’s inclusion into the city’s brownfield redevelopment plan. Tax increment districts like the DDA capture taxes on property value increases for specific uses.
“We are sensitive to the city’s needs and want to share the captured funds with the DDA,” Rooks told authority board memebers.
The DDA, in part, is still repaying the public bonds from the Muskegon Mall era and if bond payments are not covered by DDA tax-captured funds the city’s general fund has to make up the difference, city officials have said.
As the Terrace Point residential lots are developed, sold and new houses built, the new property taxes collected will eventually be used to pay for a variety of activities. The estimated $2 million in eligible activities will be paid off over from 20 to 35 years with an additional 5% paid the developer for his cost of financing, according to the plans approved by the authority board.
The expected eligible activities include:
Conducting a first and second phase of a baseline environmental assessment.
Completing “due care” activities of putting a one-foot cap of clean fill over the contaminated areas and hydroseeding the fill materials.
Removing and properly disposing of contaminated soils
Preparing the site for development for drainage, debris removal, and repair of the Muskegon Lake seawall
Finishing infrastructure improvements such as storm sewers, water, sanitary sewers, streets, curbs, sidewalks and landscaping.
Rooks said since receiving city site plan approval for Terrace Point Landing earlier this year, work as continued on site design and preparation for marketing and sale of the lots. Eventually, Rooks will work with a builder for the houses, which will be on narrow lots and cottage-like in style.
The lots are expected to sell for $125,000 on the waterfront and $50,000 for inland locations in the site condominium development, which includes a beach, swimming pool and “forested courtyard” in the development’s interior. Homes will sell from $125,000 to $275,000, Rooks said.
“We think we can sell this development,” rooks told authority board members. “The price point that we are offering is one of the lowest in West Michigan for access to the lake.”
rooks is also the owner of the Shoreline Inn, Lake House restaurant, Terrace Point Marina and is moving his development offices from Grand Rapids to the former city central fire station, which he has purchased. Rooks’ Parkland Development also has plans to convert the former Comerica Bank tower building in downtown Muskegon into market-rate apartments in creating Highpoint Flats.