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Commission approves redevelopment district and tax-exemption for former Harbor Theater at 1937 Lakeshore Drive
Summary
Muskegon commissioners voted to create a commercial redevelopment district and to approve an eight-year commercial facilities exemption certificate for a planned mixed-use rehabilitation of the former Harbor Theater at 1937 Lakeshore Drive. Developers said the project will include ground-floor commercial space and upper-floor condominiums, and pledged to use local lenders and subcontractors.
Muskegon City Commissioners voted unanimously to establish a commercial redevelopment district and to grant an eight-year commercial facilities exemption certificate for 1937 Lakeshore Drive, the former Harbor Theater.
Isabella Gonzalez, the city’s development analyst, said establishing the district enables the property owner to apply for the exemption certificate, which "will freeze the taxable value of the building and exempt the new real property investment from local property taxes." Staff told the commission the rehabilitation would convert the 17,000-square-foot theater into ground-floor commercial suites with residential units on upper floors and that the internal tax committee recommended an eight-year term for the abatement.
Developers from Lakeside Development Properties LLC and contractor Jill Bourdon of Randers CNC presented details to the commission. "We're going to use local lenders," Bourdon said, adding that the team expects a local real-estate group to market the condominiums and that they plan to hire local subcontractors. Commissioners pressed the developer on whether the ground-floor tenant would be active retail or office; Bourdon said the likely tenant is a financial-services firm but that negotiations were ongoing.
Commissioners framed their vote around downtown activation and building re-use. "I'm personally glad to see that the theater's not just going to sit there and rot away," Commissioner Kilgo said during discussion. Several commissioners emphasized the importance of local hiring and minority-contractor opportunities as conditions of support.
The motion to close the public hearing and approve the redevelopment district was made by Commissioner Kilgo and supported by Commissioner St. Clair; the exemption certificate was later approved on a separate motion by Commissioner Kilgo with support from Commissioner Cochen. Both motions passed on unanimous roll-call votes.
What happens next: developers will proceed with design and financing and must complete required paperwork for the exemption certificate. The staff report lists an estimated project investment of about $3.66 million and an anticipated construction start in April 2026; final project costs, timing and tenant agreements were described as still being finalized by the developer.
