Brownfield Redevelopment Fuels Brewery’s Expansion and Revitalization in Michigan’s 2nd Largest City

GRAND RAPIDS, Mich. — The outdoor beer garden at Founders Brewing Co. was packed on Saturday afternoon, despite chilly and rainy weather conditions that rolled into town this weekend. So too was the expansive taproom inside. There wasn’t a seat available anywhere.

Craft brewing is a booming business in Michigan’s second-largest city and Founders, founded in 1997, is one of the biggest draws in town. It’s a mandatory stop for out-of-town craft beer enthusiasts plus locals who often bounce from one downtown hotspot to another, especially on weekends.

Grand Rapids residents may not realize it, but Founders’ national footprint is quite expansive, with full or partial distribution in 32 states and the District of Columbia. With out-of-state demand growing, Founders hasn’t been able to keep up. Its on-site production facility simply isn’t large enough.

Outside Founders Brewing Co. on Grandville Avenue in Grand Rapids. (Photo by Michael Grass / GovExec.com)

This past week, Founders announced a major two-phase $35 million expansion that will add nearly 60,000 square feet to its facility, which will include a new brew house and room for additional fermentation tanks and packaging equipment. Overall, it’ll give Founders room to ramp up production, eventually, to a capacity of 900,000 barrels on a footprint that takes up an entire city block.

“Because of increasing demand from the growing beer enthusiast community, we aren’t able to fill orders right now. We’re expanding because we’re committed to this city, this state and the craft beer community,” Founders co-founder and CEO Mike Stevens said in the brewery’s expansion announcement.

That expansion, plus the brewery’s 2008 relocation to its current site on Grandville Avenue across from the Grand Rapids Central Station transit hub, has been made possible in part through the city’s brownfield redevelopment program, which, with tax-increment financing, helps developers pay for the costs associated with environmental assessment and clean-up at brownfield locations.

In the case of Founders’ location, once home to a trucking terminal, there were issues with on-site soil contamination. The tax credits approved Thursday will offset the expansion costs by $4.5 million over the course of 25 years, according to WZZM-TV. With other brownfield projects, like the current redevelopment of the former Morton House hotel on Monroe Center into market-rate apartments, brownfield redevelopment assistance might involve lead and asbestos removal.

Financing assistance from the Grand Rapids Brownfield Redevelopment Authority has helped rejuvenate buildings and vacant lots across the city, but especially downtown—in particular, the southern fringe of downtown, including the Heartside District.

This largely commercial and warehouse area originally developed around the city’s main railroad station, demolished in 1961 when the U.S. 131 expressway viaduct was built. But it declined through the latter half of the 20th century, when much of the city’s famous furniture industry slumped as well.

Looking toward Van Andel Arena, at left, and the Heartside District, at right. (Photo by Michael Grass / GovExec.com)

Many Grand Rapidians used to avoid this once-dilapidated part of downtown. But in 1996, the opening of Van Andel Arena helped bring more foot traffic and business to the area south of Fulton Street.

Now the Heartside District is a showcase for the city’s ongoing revitalization, with many components that support the local creative economy—bars, restaurants, coffee shops, art galleries, higher education, loft-style office spaces, newly built or revitalized residential units and many small home-grown businesses, including an artisanal doughnut shop.  

There’s also the Downtown Market, a brownfield redevelopment project that opened last year along a relatively desolate stretch of Ionia Avenue. It has created a vibrant epicurean hub that, like Founders, is a big draw both for visitors and local residents.

Inside the Downtown Market’s food hall (Photo by Michael Grass / GovExec.com)

This year, the Grand Rapids Brownfield Redevelopment Authority has provided assistance on more than 25 projects. Since 1998, when its first projects got off the ground, the brownfield program has been responsible for $1.3 billion in investment and 5,000 new jobs, according to Terry Nichols, the authority’s chairman and CEO.

“We see a very active climate for more projects for 2014 and ’15,” he says in a recent video feature on the city’s brownfield program. “It seems like there’s a big increase in multi-use development buildings and projects downtown, which would be mixed-housing, market housing and retail.”

Earlier this year, the Grand Rapids Brownfield Redevelopment Authority applied for and was awarded a $400,000 grant from the U.S. Environmental Protection Agency, which will help the authority provide funding for environmental site assessments. The assessments are required for purchasers of commercial and industrial properties under Michigan’s Natural Resources and Environmental Protection Act.

The authority previously offered environmental assessment assistance from an earlier $700,000 EPA grant, which, according to Jonathan Klooster of the city’s Economic Development Department, was used on 50 projects on 80 acres of property that resulted in $80 million in new private investment. Projects are assessed based on a variety of criteria, including projected job creation and level of private investment.

The former Morton House hotel, one of the redevelopment projects that’s received assistance from Grand Rapids’ brownfield authority, sits on Monroe Center, the historic heart of the downtown commercial district. The city removed the ailing, largely vacant Monroe Center pedestrian mall more than 15 years ago and since then, it has seen storefront vacancy drop.

The Morton House was once a fashionable 13-story hotel, but its fortunes declined with those of Monroe Center. The hotel served as subsidized apartments until 2011. Many of its previously grand public spaces and ornate staircases were walled off from tenants in an attempt to reduce energy costs, according to WOOD-TV. It’s now being transformed into market-rate apartments, with retail and restaurants planned for the ground floor.

“Symptomatic Constant,” an ArtPrize installation, occupies the ornate lobby of the Morton House, which is being redeveloped. (Photo by Michael Grass / GovExec.com)

Although the renovations, spearheaded by a group of private investors, won’t be complete until next year, the public has been busy checking the place out as a popular venue for Art Prize, the annual multi-week international art competition that transforms sidewalks, public spaces and other buildings into an urban artistic showpiece. ArtPrize attracted nearly 400,000 visitors to the city and pumped $22 million into the local economy in 2013, according to the Grand Rapids Business Journal.

In the Morton House’s vaulted lobby is a mixed-media installation titled “Symptomatic Constant,” by artist Julie Schenkelberg. In a statement on the work, she called it a “representation of a shipwreck in the Midwest” intended to “engage with the American Rust Belt’s legacy of abandonment and decay.”

It’s certainly an appropriate installation for a brownfield redevelopment building, but one that might not reflect the previously sickly Monroe Center, which is now home to the Grand Rapids Art Museum, the nationally recognized MadCap Coffee, new restaurants and revitalized office space and retail.

The 616 Lofts, at right in the red brick building, on Monroe Center. (Photo by Michael Grass / GovExec.com)

Two other brownfield redevelopment projects, the CityFlats Hotel and 616 Lofts, are also on Monroe Center, which is anchored on its eastern end by the recently restored Civil War memorial fountain at Fulton Street and Division Avenue, adjacent to the Urban Institute for Contemporary Arts and Grand Rapids Children’s Museum.

The 616 Lofts project was also the first in Grand Rapids to receive state grants through the Michigan Community Revitalization program, which replaced the state’s brownfield and historic properties tax credit programs, according to The Grand Rapids Press, in 2011.

Looking toward Division Avenue corridor in the Heartside District (Photo by Michael Grass / GovExec.com)

To the south along Division, in the Heartside District, clusters of ArtPrize goers with umbrellas checked out some venue locations during Saturday afternoon’s rain. This included the 122-year-old Harris Building, another recipient of brownfield redevelopment assistance.

Once used a furniture showroom and a secret fraternal organization meeting space, it’s now home to an organic pasta company and cafe and is used as gallery, pop-up retail and special-events space.

It’s a perfect setting for an ArtPrize venue, where the building’s cool interior and exterior “HARRIS” sign are themselves as much of a conversation starter as the art on display inside.

The Harris Building is very much one of the many standard bearers for the city’s ongoing renaissance, a revitalization that’s been helped in part by craft brewing, local entrepreneurship and events like ArtPrize, but made possible in large part to Grand Rapids’ successful brownfield redevelopment efforts.

Michael Grass is Senior Editor for GovExec State & Local.

MORE PHOTOS from the Morton House and Harris Building ArtPrize venues ...

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