MARQUETTE - A new downtown development is one step closer to becoming a reality after receiving an important state approval last week.
Marquette's Veridea Group, which is planning a $31 million commercial, retail and residential development on the west edge of the city's downtown area, received approval Nov. 28 from the Michigan Strategic Fund's board, classifying the site as a brownfield.
"We appreciate the support of the Marquette Brownfield Redevelopment Authority, the city of Marquette and its staff, the (Michigan Economic Development Corporation) and the State of Michigan to make this expanded project happen and we are excited to get started," Veridea Group President Bob Mahaney said in a written statement.
The way has been cleared for work to begin on the site of a former bakery located at Marquette’s 857 W. Washington St., seen here. The Veridea Group, which is planning a $31 million commercial, retail and residential development on the site, has received state approval that helped the company secure tax breaks and a low-interest loan package. (Journal photo by Matt Keiser)
The property - a former bakery located at 857 W. Washington St. - has been deemed functionally obsolete by the city assessor and is thus eligible for brownfield status.
The Brownfield Redevelopment Financing Act allows for the capture of incremental local and school property taxes from redeveloped properties to pay for environmental costs, infrastructure improvements, demolition and site preparation costs associated with those properties.
The captured taxes will be directed to the city's brownfield redevelopment authority, which will reimburse Veridea for the additional costs.
The MSF board last week approved the brownfield status on a state level, allowing for the additional abatement of state taxes. That move should allow Veridea to recoup the associated costs faster.
Veridea has estimated it will spend more than $10 million on brownfield-eligible activities, including environmental remediation, lead and asbestos abatement, demolition, site preparation and infrastructure work, which would include two levels of underground parking.
The city master plan calls for high-density development in the area and a parking structure would be necessary to accommodate associated traffic.
The Veridea plan calls for the development of a four-way stop light at the intersection of Washington Street and Lincoln Avenue, which would also serve as the entrance to the complex. A traffic study is currently under way in that area.
Under the previously proposed plan, the tax capture can run through 2036 and would net $17.6 million.
After more than six months of planning and approvals - the project was first proposed to the local brownfield authority in May - last week's state approval opens the door for work to begin, according to Carol Vining Moore, chairwoman of the MBRA.
"We are excited about the prospect of a major investment in this important area of Marquette and happy the Brownfield Authority was able to assist," she said in a written statement. "This cooperative approach will result in the cleanup of a blighted industrial site, provide jobs, increase density and tax base, offer downtown living opportunities and spur additional investment in the West Washington Street area."
Additionally, the MSF Board last week approved a $1.875 million low-interest loan package through the MEDC's Community Revitalization Program.
Mahaney said that money will go toward construction of some of the project infrastructure, such as the parking structure.
Veridea estimates that, following the retirement of brownfield obligations, annual tax revenues for the property will total more than $1.3 million.
The project, according to Veridea officials, will be constructed in four phases and is scheduled to be completed by June of 2016.
Kyle Whitney can be reached at 906-228-2500, ext. 250.