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Business North - Around The Region - Duluth & Superior Newspaper
Developer eyes Central School for restaurant, brewpub
A West Range development group wants to open a first floor restaurant and brewpub at the Old Central School in Grand Rapids.
Last week, members of the Grand Rapids Economic Development Authority took first steps toward that goal – entering into a predevelopment agreement with Northrock Development LLC.
Northrock is a partnership between Grand Rapids State Bank Senior Vice President and City Councilor Ed Zabinski and Magentation President and Chief Operating Officer Matt Lehtinen. In a telephone interview, the two said they had been thinking about the concept independently for some time then decided to join forces.
“There’s a glaring need for a good restaurant downtown,” said Lehtinen, adding that the vision was a mini version of Fitger’s, located in downtown Duluth. “We intend this to be a cool place to eat and gather.”
The business partners say initially the establishment would be a restaurant, like a gastropub, but might later expand to include beer brewing.
The potential development fits well with defined goals for the structure. City planners have long hoped for a restaurant to drive traffic into the building.
The GREDA manages Central School on behalf of the city of Grand Rapids, and occupancy has recently reached 100 percent, noted Community Development Director Ron Mattei. The predevelopment agreement extends through October of 2015. Under its terms, the GREDA would not sign any Central School tenant leases for the area under review that extend beyond the end of next year.
Because tenant capacity has been reached at Central School, the predevelopment agreement does carry some risk to the city. Tenants may choose not to renew a lease in light of the uncertainty. There are five current tenants in the suites sought by Northrock that would potentially be impacted. Leases are signed on a year-to-year basis and renew on Jan. 1.
“There is the risk that a tenant won’t renew based on the possibility that this comes to fruition,” Mattei told the GREDA. He also noted that the Central School was on track to break even in 2015 after years of operating in the red.
Locating a restaurant/brewpub in Central School would require redevelopment of the property. Minneapolis-based architectural firm Miller Dunwiddie, which specializes in historic building preservation work, will conduct the necessary facility/feasibility study.
That study will cost between $15,000 and $35,000. Mattei will be seeking grant funding to offset costs, with the remainder to be paid by the GREDA and the developer. The preliminary agreement contains no lease rates. Those would be negotiated at a later date if the project moves forward. Central School lease rates are structured to be cost-neutral to the city.
Lehtinen and Zabinski hope to move the project forward before the Oct. 2015 predevelopment agreement expires. However, Zabinski noted that taking the project from feasibility to actual development is still “a long way from happening.”
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