City approves artist lofts, will write letter of support for Artspace

By BOB OLIVER
Times-Herald Newspapers

DEARBORN — The City Council approved two agenda items to help Artspace in its quest to receive funding so that it can move into the city hall complex.

At its Aug. 13 meeting, the council voted 4-1 to amend the city ordinance to allow artist lofts in city hall, and 5-1 to approve the East Dearborn Downtown Development Authority’s Community Revitalization Plan and authorize Mayor John O’Reilly Jr. to sign an associated letter of support for the Artspace project.

O’Reilly said that the EDDDA’s revitalization plan includes a summary of its projects that the city already has approved and describes how Artspace will fit into the economic development of the city into the future.

Council President Thomas Tafelski voted against both items while Councilwoman Nancy Hubbard abstained from voting on the ordinance addition.

Artspace is a Minneapolis-based nonprofit real estate developer that wants to renovate the city hall building to house and create work spaces for artists as well as spaces for art studios, art organizations and creative businesses. It has similar properties throughout the country, but this would be its first in Michigan.

The changing of the city ordinance to have artist lofts will allow Artspace to renovate current rooms in city hall into 45 to 49 livable apartments. It also is a necessary step in Artspace’s application for financing from the Michigan State Housing Development Authority under the Low Income Housing Tax Credit Program. The application deadline was Thursday.

Another important component of the application process was that Artspace needed to have the deed to the building. Last month, the city council approved the sale of parts of the complex “as is” for $1.65 million, the price at which the complex was appraised.

The sale did not include city hall park or the city-owned parking lot south of John Nagy Drive. The war memorials and statue of former Mayor Orville Hubbard in the park would be moved to the Dearborn Administration Center (the old ADP building) at 16901 Michigan Ave., which is where the city is expected to move its operations. City officials estimate that the move would save the city $400,000 annually in operating costs.

Artspace will receive notification in November if it is approved for the MSHDA grant, for $6.9 million. If not, it can re-apply in February.

If approved, the money could be used only for converting rooms to lofts in the east and west wings of the complex because the money can be used only for housing. Renovations to the complex are expected to take 12 to 15 months with the first tenant moving into the development in October 2015.

Other repairs needed at the complex — such as the concourse or fixing the parking deck — would have to be paid for by Artspace or through donations from outside sponsors.

One source of income for the renovations could be Severstal North America, which has offered $1.45 million to develop the concourse and $345,000 for Artspace’s development costs as part of an $8.5 donation offer to the city for the project and the moving of city operations. In return, Severstal would receive naming rights in the project.

If the MSHDA application is approved in November, the city will move out of the building in June 2014. If the funding is not approved until February, the city will not move until the fourth quarter of next year.

(Bob Oliver can be reached at boliver@bewickpublications.com.)

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