grand rapids urban market concept plan &...

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Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand Rapids Urban Market Concept Plan & Feasibility Study Public Presentation March 24, 2010 Study Process Advisory Committee 125+ interviews –retailers, farmers, food distributors, restaurateurs, wineries, farmers’ market managers, public officials, nonprofits, developers, educators, artists, health care, ethnic representatives Consumer and farmer focus groups Demographic research Agricultural census research and farm visits Site analysis and selection Merchandising concept Partnership exploration Financial analysis Economic impact analysis

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Page 1: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 1

Grand Rapids Urban Market Concept Plan & Feasibility Study

Public Presentation

March 24, 2010

Study Process

• Advisory Committee

• 125+ interviews – retailers, farmers, food distributors, restaurateurs,

wineries, farmers’ market managers, public officials, nonprofits,

developers, educators, artists, health care, ethnic representatives

• Consumer and farmer focus groups

• Demographic research

• Agricultural census research and farm visits

• Site analysis and selection

• Merchandising concept

• Partnership exploration

• Financial analysis

• Economic impact analysis

Page 2: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 2

What makes a public market successful?

1. Great site

2. Environment

3. Engaged professional

management

4. Culture of public market

shopping

5. Great vendors

Milwaukee Public Market

Granville Island Public

Market, Vancouver

Urban Market Goals

1. To create a dynamic place that attracts the region’s diverse

residents and visitors

2. To strengthen and celebrate Grand Rapids’ local food system

3. To catalyze redevelopment around the Urban Market

4. To provide opportunities to independent entrepreneurs

5. To promote healthy lifestyles and create a model of

sustainable development

Page 3: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 3

Demand Analysis Findings

• Overwhelming support and enthusiasm for Urban Market concept, and

belief it will succeed

• Support from Fulton Street Market leadership; secure in their base of

farmers and customers; do not perceive negative impacts

• Awareness of local foods movement and viability of farmers’ markets

• Perception that downtown Grand Rapids is ready for this type of project

and the Urban Market can have a profound impact on the region

• Expect to be big draw for tourists, most of whom arrive by car

1.0 mile

ring

6%

1.0-5 m

band

43%5-20 m

band

31%

Tourists

20%

Source of Demand• Restaurants, institutions interested in accessing

local foods

• Growing ethnic community expected to be

attracted to Urban Market

• Fresh food sales potential: $20+ million from

customers in 20 mile radius and tourists

Key Agricultural Data Findings

Source: USDA Census of Agriculture

y = -15.103x3 + 1344.7x2 - 17135x + 107810

R² = 0.9696

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

80,000

90,000

100,000

1964 1969 1974 1978 1982 1987 1992 1997 2002 2007 2012 2017

Number of Farms - Michigan

Year Farms - MI

1964 93,504

1969 77,946

1974 64,094

1978 60,426

1982 58,661

1987 51,172

1992 46,562

1997 46,027

2002 53,315

2007 56,014

2012 61,932

2017 69,729

Change 2007-2017 13,715

Change % 2007-2017 24.5%

Page 4: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 4

Direct Market in West Michigan

y = 3267.8e0.379x

R² = 0.9206

$-

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

1992 1997 2002 2007 2012 2017

Direct Marketing Sales (000s) Region

y = 859.64e0.1227x

R² = 0.8322

-

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

1992 1997 2002 2007 2012 2017

Direct Marketing - # of Farms

Source: USDA Census of Agriculture

Direct marketing in West Michigan

Year # Farms Sales (000s)

1992 1,026 4,681$

1997 1,053 7,914$

2002 1,149 8,385$

2007 1,500 16,239$

2012 1,588 21,739$

2017 1,795 31,757$

Change 2007-2017 295 15,518$

Vendor Research

• Large, diverse farming region with increasing focus on specialty crops and

direct marketing

• Expanding number of small farmers

• Increase in number of farmers’ markets throughout region

• Increasingly sophisticated restaurant community, great interest in local

foods

• High quality, locally owned supermarkets with strong loyalty – nimble

competitors

• Small number but high quality specialty food retailers

• Strong interest from retailers, wineries, artists, and food distributors in

participating in Urban Market

Page 5: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 5

Site Selection

• Site Criteria

– Visibility from highway

– Accessibility by car, truck, bus and foot

– Surface parking

– Potential to influence downtown revitalization

– Context/supportive adjacent uses

– Size/mixed use opportunity (4 acres)

– Availability and cost

– Reuse of historic buildings

• Over 20 sites identified

• Recommended site

– DDA-owned Sonneveldt

property on Ionia & Wealthy

Sonneveldt siteAdvantages

• Superb highway visibility

• On-site parking

• Easy access via car, bus, foot, and bicycle

• Architectural interest and adaptive reuse

• Extends downtown, helps revitalize “frontier”

• Developable adjacent properties

• Supports nearby investments by nonprofit developers and Catholic diocese

Challenges

• Perceived as outside downtown

• Perceived as unsafe (Heartside Park)

• Off-site parking needed long term

Sonneveldt

Page 6: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 6

Development Program Principles

• “Center of local food excitement”

• Complexity of uses, with multiple income streams

• Large enough to be regional and tourist magnet but not too

large that exceeds potential demand or supply

• Able to be phased

• Production focus – products made by the vendors

• Address opportunities in retail, wholesale, food production

and education

Proposed Development Program

Program Element Square feet

Permanent market retail and indoor day tables 26,766

Outdoor farmers’ market shed 9,700

Crafts/art studios 9,310

Complementary retail 10,930

Restaurants/wine bar 13,925

Food aggregation and distribution 2,770

Kitchen incubator/food processing 3,910

Education, meeting rooms, community space 6,000

Events, performance, public space 3,750

Rooftop greenhouse 23,915

Wine cave/root cellar 5,000

Housing 19,410

Office 11,680

Basement storage 10,000

Page 7: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 7

Development Concept – One Story Building

Market Hall

North Market, Columbus, OH

Development Concept – Two Story Building

Restaurant, shared commercial kitchen,

education

Page 8: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 8

Development Concept – Logan Street Buildings

Retail, produce distribution,

housing/office

Development Concept – Triangular Building

Artist Studios/Market hall expansion

Page 9: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 9

Design Concept – Site Plan

Design Concept – Ground Level

Page 10: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 10

Design Concept – Second Level

Sustainable Design Elements – Initial Ideas

• Reuse of historic buildings

• LEED or Energy Star rating

• Construction materials

– Reuse of materials

– High R factor insulation

– Green materials

• Energy

– Geothermal

– Greenhouses with heat capture;

green roofs

– Clustered refrigeration compressors

– High efficiency appliances

– Vegetable oil cogeneration

• Waste handling

– Composting and recycling

– Vegetable oil cogeneration

• Water

– Submetered water

– Low water fixtures

• Lighting

– Natural lighting

– High efficiency

• Transportation

– Access to public transportation

– Convenient for walking

– Bicycle racks and promotions

Page 11: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 11

Financial Analysis

• Reasonable rents

– Permanent vendors: rents = 5.4% of sales

– Farmers’ market: $22/day at peak season

• Market operations

– Multiple income sources

– $2.0 million rents and fees; $1.5 million

operating costs (3rd year)

– Positive cash flow can pay land rent and/or

bonds

• Development budget

– Initial projection: $27 million

– Based on design schematics only

– Land costs not included

Funding Opportunities

• Tax credits

– New Market

– Historic

– Brownfield

– Housing

• Foundations

– Grants

– Program Related Investments

• Individual/Corporate donors

– Naming opportunities

• Federal government

– Legislative appropriation and grants

– Department of Commerce, EDA

• $2.5 mill for Milwaukee Public Mkt

• $2 million for Eastern Market, DC

– Department of Agriculture

• Healthy Food Financing Initiative

– Department of Health & Human

Services

• Community Food & Nutrition

Program

– Department of Energy

• Bonds

• Private investment

Midtown Global Market, Minneapolis

Page 12: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 12

Partnership Opportunities

• Education

– Food and nutrition

– Cooking

– Entrepreneurship

– Kitchen incubator

– Gardening and food

production

• Local food system

– Greenhouse gardening

– Area farmers’ markets

– Hub for local initiatives

• Tourism/promotions

– Ag tourism

– Downtown promotions

– Events

• Health

– Wellness initiatives

– Food rescue

Important for achieving goals, creating community loyalty and enhancing sales

Benefit Analysis: Economic

• Economic benefits

– Direct benefits of increased sales

– Indirect benefits from increased purchases of other materials and services

– Induced benefits to household incomes and consumption

• US Bureau of Economic Analysis RIMS II Multipliers

– 11 county region

– Create 1,271 jobs (construction and sales)

– 10 year economic impact: $775 million

• Other economic benefits

– Business creation and support

– Increase neighboring land values

– Complement recent neighborhood investments

• Cathedral Square

• Dwelling Place

• Ionia Avenue entertainment corridor

Page 13: Grand Rapids Urban Market Concept Plan & …media.mlive.com/businessreview/western_impact/other/...Grand Rapids Urban Market Feasibility Study Market Ventures, Inc. March 2010 1 Grand

Grand Rapids Urban Market Feasibility

Study

Market Ventures, Inc. March 2010 13

Benefit Analysis: Social

• Downtown revitalization

– Expand walkability of downtown

– Dynamic gathering place

• Food access/food security

– Culturally appropriate foods

– Subsidized fresh food (Project Fresh)

• Model of sustainability

– Greenhouse roof

– Construction

– Composting

• Tourism

– Major new downtown attraction

– Elevate national/international

profile of West Michigan foods

• Health

– Access to healthy fresh foods

– Community space for health

education programming

• Regional agriculture

– Engine to support development

and marketing of regional foods

– Place to connect food

professionals with producers

Next Steps

• Secure DDA endorsement of concept

• Predevelopment phase fundraising

• Architecture & Engineering team RFP and selection

• Tax credit planning and syndication

• Partnership development

• Development fundraising

• Concept refinement and leasing