What’s next for the former Marquette hospital property after agreement reached with NMU Foundation

Economy

MARQUETTE, Mich. (WJMN) – Action continued on Wednesday after an agreement was reached between the Northern Michigan University Foundation (NMUF) and UP Health System – Marquette to potentially make use of the former hospital property on College Avenue in Marquette.

On Thursday morning, the Marquette Brownfield Redevelopment Authority (MBRA) approved an application from the NMUF for use of MBRA’s local revolving fund to pay for part of the initial assessments of the property.

“It’s an area that the Brownfield Authority has been quite interested in. It’s sort of right in the middle of our wheelhouse. An obsolete are we don’t want to become blighted. We don’t want it to become completely abandoned so we’re quite happy the foundation is interested to catalyze this. We were quite happy to add our own catalyst to it too,” said David Allen with the Marquette Brownfield Redevelopment Authority.

That money will help fund a Phase I Environmental Site Assessment (ESA), and a Limited Phase II ESA, a Hazardous Materials Assessment.

“We’re in that period right now of trying to get a better understanding of whether a development project is financially and practically feasible. We’re working with a variety of experts that are working as consultants for the the NMU Foundation on that project including TriMedia on the environmental side of things. We’re including the Veridea Group which has just agreed to provide services pro bono to the NMU Foundation on the master planning side of things. If we get to a point next spring where we determine the project is financially and practically feasible, the agreement contemplates the NMU Foundation would take possession of the property. And either before that point or after that point we would immediately issue a request for qualifications to a master developer and we would enter into a partnership with that master developer to develop the site,” said David Nyberg with the NMU Foundation.

We asked David Allen with MBRA how the first phases will work and what they hope to learn from them.

“The first thing that happened in the Phase I is you look at historical records and you try to figure out how were these building built, and for what purposes and with what materials and in what eras to try and figure out if they may have used asbestos. They may have lead paint. That there is some reason to think there was some sort of process where contamination could have ended up in the ground water and soils. Then based on what you find out from those Phase I look at historical records, you then go out and potentially do some sampling. It could be samples of the interior of the building for lead based paint or asbestos or soils and groundwater. Those two together then give you a much better idea of what activities might be eligible under Brownfields,” said Allen.

Allen went on to explain how the results of these initial phases could impact the rest of the process.

“The whole idea of a Brownfield is that you’re putting some front end effort to get a very difficult site, that’s difficulty to develop. You’re getting it over some hurdles so that the property value will go up in a way that it wouldn’t otherwise. Once those property values go up, you then capture those increased taxes to pay for these extraordinary activities. So it’s a way of getting something done that wouldn’t otherwise be done without it costing a bunch of general revenue kinds of taxes. So these are self-reinforcing activities where the developer causes the property values to go up, those make the property taxes go up, and that then covers some of these extraordinary costs at sites like this,” said Allen.

Those extraordinary costs could include things like demolition or cleanup of groundwater contamination. The agreement with the NMUF includes an evaluation period which lasts through the end of February. If at the end of that process, the NMU Foundation does take possession of the property, they would not be the entity to develop the site. They would be an equity investor to bring in an expert master developer to develop the site if all the determinations are made that it can be done.

“It’s very important to understand that the Northern Michigan University Foundation is acting as a catalyst at this stage. Our mission is to develop and foster relationships and resources that benefit Northern Michigan University. Which this endeavor really is seeking to do. We view ourselves as an enabler, an enabling entity. We’re convening a consortium of partners in the public and private sector that are experts in this work, and hope to get beyond the due diligence phase to a point where we’re establishing a formal private sector partnership. But for right now and for the next several months, all of the hard work is being done to understand whether or not we can proceed,” said Nyberg.

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