Published: August 18, 2008 08:00 pm      

Loan expected to help pay for clean-up

$1M would go toward asbestos, lead paint removal at proposed

TRAVERSE CITY -- Asbestos removal and other cleanup work is ready for two century-old cottages and a dining hall at the Grand Traverse Commons property to make way for a $24 million hotel.

A $1 million loan from the state Department of Environmental Quality to help pay for asbestos and lead paint removal, mold clean-up and some demolition at Buildings 20, 28 and 40 is awaiting formal state approval, said Jean Derenzy, who runs Grand Traverse County's brownfield program.

The three adjoining structures are planned for The Inn at the Commons, a hotel project planned to include 83 rooms in its first phase, with future plans for 34 additional rooms and a health spa.

"It will be a nice shot in the arm for the project," Derenzy said. "It's pretty much ready to go."

The county and project developers applied for a $2 million loan through the DEQ, but received only half the request because of the state's budget constraints. That won't slow the project, said Raymond Minervini of The Village at Grand Traverse Commons.

"It's one of those things where we'll have to find other (financing) options ... we can make it work," Minervini said.

The long-term DEQ loan is repaid through increased tax revenue generated by building restoration at the project. Developers also are in line for an estimated $2.5 million state business tax credit, based on approximately $20 million in private investment and the creation of an estimated 190 jobs.

That request will be considered by the Michigan Economic Growth Authority Board this fall, Derenzy said.

Hotel developer John Weeman of Partners in Development said he's pleased the state is making a major commitment to the site, but voiced frustration at the long wait for state funding.

State and federal tax credits are needed to make the project financially feasible because of the high costs associated with historic preservation of the buildings, he said.

"Several things have happened to get us excited again about the project," said Weeman, who hopes to open the initial phase in early 2010. "Everything right now is on go."

Derenzy said the county also will update its brownfield plan for the Commons to include the hotel site and other structures located in Garfield Township to make them eligible for other state brownfield funding.