Council postpones decisions on downtown 224 Washington redevelopment and tax capture plan

The Grand Haven City Council on Sept. 2 voted to postpone consideration of two linked redevelopment incentives for 224 Washington Ave., the longtime vacant Grand Haven Jewelry property, until the council’s Sept. 15 meeting.

Council members debated whether to establish an obsolete property rehabilitation district for the building and separately whether to adopt a brownfield plan that would capture tax increment revenues to subsidize three “attainable” apartments there. The council approved separate motions to delay each item: a motion to postpone the obsolete-property designation was moved by Councilmember Kevin McLaughlin, seconded by Councilmember Karen Lowe and passed on a 4–1 roll call (McLaughlin yes; Lowe yes; Fritz no; Maneta yes). A motion to postpone the brownfield plan was moved by Councilmember Fritz, seconded by McLaughlin, and passed unanimously by the council members present.

City staff presented background that the property has been vacant since February 2017, was purchased by the current owner on July 30, 2020, and that the owner seeks an obsolete-property certificate to convert the upper stories to seven residential units (three described as attainable) and the ground floor to commercial space. The developer requested a 12-year obsolete-property period; the brownfield plan materials in the packet included language referring to a 20-year plan, while staff said the developer is asking to capture just over $200,000 over 15 years to cover the attainable-unit rent shortfall.

During the discussion, Councilmember Karen Lowe raised multiple concerns about the owner’s five-year period of limited activity and questioned whether the owner had sufficient cash equity in the project. “To me, that’s not skin in the game,” Lowe said, citing demolition work done soon after purchase and a long interval of inactivity. Other council members pressed staff and the developer on the project budget and on whether the attainable units — described in the materials as targeted at 80–100% of area median income (AMI) — would be genuinely affordable. Councilmember Mike (surname not specified in the record) called 100% AMI “not affordable” in the local context.

Developer’s representative Jared Belka told the council rising interest rates and post‑COVID construction cost escalation paused the project after initial due diligence and that state and local incentives — including the housing TIF and a possible MEDC grant — are being combined to make the project feasible. “The developer initially wasn’t intending to ask for incentives,” Belka said, adding that market changes and financing dynamics changed that calculus.

Council members asked for additional financial detail before approving any incentives. Staff and several council members noted spreadsheet and valuation issues in the packet: the pro forma materials used the 2024 taxable value rather than 2025 values, which staff said would need recalculation. Multiple council members asked for clear performance milestones or “clawbacks” that would require the developer to meet start/completion targets and design commitments before the city released tax capture funds.

Because city code requires separate actions for establishing an obsolete-property rehabilitation district and for approving a brownfield/tax-capture plan, council members said they were deliberating the two items together but voting on them separately; both actions were ultimately postponed to allow time for revised financials, a clearer timeline, and written performance milestones from the developer.

Carol Acone, a Grand Haven resident, urged council in public comment to deny obsolete-property and brownfield designations for the property, arguing that demolition and replacement might better serve downtown and questioning the building’s architectural or historic value. City Manager Dana and other staff confirmed the assessor’s letter declaring the property functionally obsolete is in the record.

The council’s postponements mean the city will take up the two items again at its regular meeting on Sept. 15, after staff and the developer provide updated financial data, clarification about tax base years used in calculations, and proposed developer commitments on milestones and affordability terms.