The Stadium & The Amphitheater, Some Basics

The amphitheater and the soccer stadium have flooded the news. However, there is a lot of news, as well as a lot of misinformation. For convenience and simplicity . . .

The Basics

The basics of the currently four (4) proposed projects are as follows:

The real transformative component of both of these venues for downtown, and the adjacent corridors and neighborhoods, would the residential towers.

No developers have signed on for the tower developments at either site; Grand Action, the Downtown Development Authority (DDA), and The City will need to shop around for takers. The recent history of tower development in the city has not been promising. The most recent project to get cancelled being the 10-story McConnell in 2022. Aside from Studio Park Tower, on an existing podium, there has been no new residential development over six stories in the last decade. Even development in the now amenity rich Bridge St corridor has been mid-rise [Barley Flats, Bridge St Lofts, Bridge St Market - all four floors of residential].

The parking scenario proposed by the residential towers is disappointing [assuming they happen!]. While pitching both of these projects to citizens The City and Grand Action proclaimed there was ample existing parking to support both venues. Yet the auxiliary development for both sites includes a substantial amount of traffic congestion and air pollution inducing deck parking. The amphitheater tower parking deck provides a 1:1 parking allocation for each residential unit, demonstrating that neither The City or Grand Action have yet to learn how to even spell TOD (Transit Oriented Development). 😞

Grand Action has previously projected that the venue developments will ultimately result in 1,500 - 1,700 housing units; those projections are 2.0x to 2.3x that included in the currently theoretical residential towers. We'll have to wait and see.

Economics

There's a lot of misinformation about the economics of these projects.

Simple: no checks are being written. Or, almost no checks, or not by us. Some components of the projects will be paid for by the city, most notably the movement of the public services from the amphitheater site to the Scribner site. The DDA will also be constructing the riverside trail on the amphitheater site . . . but, really, that's infrastructure which should be built anyway. The majority of the funds are either private or coming from state of Michigan. As the state of Michigan loots its cities, redistributing our tax revenues out to the economically unproductive regions of the state, its about time Grand Rapids gets some of its cheddar back. The various tax incentives are going-forward incentives over the next ~20 years and will benefit nobody other than those who incur the cost of building.

The sites in question, today, generate negligible property tax revenue. The former Big Boy restaurant (407 Pearl St) paid $42,581 in property tax in 2023 and will convert to publicly owned [and thus not taxable] property. Otherwise all ~20 acres of the proposed sites is currently publicly owned and generating no revenue. Both venues will be owned by the Convention Authority, which is a public entity.

The sites, in question, also generate negligible income tax revenue. The net loss is the income tax paid by the waiters and cooks at the Big Boy. The tax capture incentives include state income tax [which again, is largely poached for the rest of the state], while the city itself will continue to collect its state-capped maximum income tax of 1.5%. IF those residential developments come to fruition they will provide ~882 new citizens paying municipal income tax, in addition to those employed at the venues themselves. That could easily total to nearly $1,000,000/yr in general fund revenue. Aside from the 32% dedicated to the police department by the city's charter general fund revenue is the revenue our elected commissions get to use most freely; general fund revenue is good.

IF the venue developments result in the 1,500 - 1,700 housing units posited by Grand Action that would result in ~$1,770,000/yr - $~2,007,000/yr in municipal income tax; in total.

Details: The city is selling the amphitheater site (201, 225, 233 and 301 Market Ave. SW) to the Convention Authority for $24,300,000, and has purchased the site at 1500 Scribner Ave. NW from Kent county for $7,450,000; the county facilities previously at 1500 Scribner are relocating to WalkerView Industrial Park. Both of these transactions are the sale of property from one public entity to another. The city has invested ~$62,000,000 in the relocation of the facilities for a net cost of ~$37,700,000 relative to the sale of the Market Ave property. In the end the city will have a new, modern, maintenance facility . . . how much is that worth? I don't know how to quantify that, other than that it is certainly worth much more than nothing.
The direct contribution of the city to the construction of the amphitheater is $20,500,000 through a bond sale - no private entity can match the terms and rates available to a municipality with a high-rating.

Connectivity

The amphitheater includes the construction of a publicly owned 12ft wide path along the Grand River from US-131 south to where the railroad tracks cross the river. The construction and funding of the path will be managed by the Downtown Development Authority (DDA). This path is intended to be the spine connecting a the variety of other trails which converge south of downtown, and then link those routes to downtown . . . although how that interfaces to downtown under US-131 remains unclear.

So far there appears to be no infrastructure proposed which would improve access to the stadium site beyond what exists today. A bike lane [or possibly even just a bike gutter] is included in the plans on Mt. Vernon Ave along the backside of the stadium, sandwiched up against the US-131 expressway and intermixed with traffic exiting from and entering the expressway. It is difficult to imagine that as either a useful or pleasant connection. Maybe we'll get a covered bus stop? 🙄 Again, Grand Action don't do TOD.

The minutes from the Rapid's March Planning & Technology Committee meeting indicates that the Rapid is being included in conversations about the venue and hints at the possibility of a preferred entrance for transit users; which is something which could be a real amenity,

What does "an extension of our BRT service" mean? I don't know. Hopefully, that means later hour service, at least on event nights. 🤞 We certainly aren't going to get the funding for extended service from the state of Michigan under the Whitmer administration which proposes transit funding cuts in every budget. 😠

Affordable Housing

In order to maximum the tax incentives for both residential towers the developer would need to either commit to 20% of units being Affordable at 100% AMI for twenty (20) years or make equivalent payments into the city's affordable housing fund for a period of twenty (20) years. If the developer chooses to income restrict units this would create 146 income restricted units; 94 in the amphitheater tower, and 52 in the stadium town. Otherwise the Affordable Housing Fund contribution would be ~$2,500,000 for the stadium tower and ~$5,900,000 for the amphitheater tower [a potential total contribution of ~$8,400,000].

The current Area Median Income for Kent county is ~$75,000/yr. See "What is affordable" for an explanation on affordability calculations.

Misc

Related

• Grand Rapids approves $318M incentives plan for amphitheater, soccer stadium, Crains 2024-05-22
• $184M Grand Rapids riverfront amphitheater breaks ground, Crains 2024-05-21
• Planning Agenda: 2024-03-28, UrbanGR 2024-03-24
• Grand Action 2.0, Grand Action homepage
• Kent County voters pass lodging tax hike for amphitheater, soccer stadium, Crains 2024-08-07
• $700M plan to 'transform' Grand Rapids with soccer arena, concert districts, Bridge 2024-08-27
• State approves $252M incentives package for Grand Rapids amphitheater, soccer stadium, Crains 2024-08-27
• Amway secures naming rights for Grand Rapids soccer stadium for $33M, Crains 2024-11-18
• Soccer league, team to be announced soon for Amway Stadium, Crains 2024-11-18