Grand Forks OKs redevelopment for former Townhouse Hotel spot

A series of interlocking agreements would turn the old Townhouse Hotel spot into three mixed-use buildings surrounding a publicly owned plaza and events space.

Grand Forks City Hall. Sam Easter / Grand Forks Herald
Grand Forks City Hall. Sam Easter / Grand Forks Herald

A second public plaza is set to be installed in downtown Grand Forks.

City Council members on Monday unanimously approved a series of agreements between the city and a trio of development and management companies for The Beacon, a set of three apartment and commercial buildings that would surround a publicly owned plaza and events space in the space formerly occupied by the Townhouse Hotel at the intersection of DeMers Avenue and First Avenue.

Council member Bret Weber said the redevelopment answers two longstanding civic questions: what is the city’s plan for the now-demolished Townhouse location? And how might city planners mark the entrance to Grand Forks’ core to motorists entering it from the DeMers Avenue railroad overpass?

“This is what we’ve been dreaming of for Town Square since the start of the visioning process for the whole downtown,” Weber said. “And Town Square was always seen as central to that, but this gives us so much more opportunity. This is Town Square squared, or even cubed.”


The agreements grant the developers a tax break via a “tax increment financing" plan, that, for property tax purposes, treats the site as if it had only partially been redeveloped. The land currently is worth about $2 million, according to city staff, but the apartments, commercial spaces, and plaza would push it to approximately $39 million. Of the $37 million difference between those two estimates, 80% of the taxes the developers would otherwise pay on that value each year would be refunded for 25 years. The developers, in turn, would then use that money to pay back a bond the city would issue to ultimately own the downtown plaza. The remaining 20% of the new taxable value of the property would be paid to the city and other local governments normally. Other “TIF” agreements have been used to entice developers to remake the now-former Memorial Stadium area near UND and the St. John’s Block apartments near the Sorlie Bridge.

Other parts of the agreement spell out how the public plaza would be managed. The developers put together a nonprofit -- Beacon Events, LLC -- that would be managed by a nine-member board comprised of three city representatives, two Grand Forks Public Schools representatives, two Grand Forks Park District representatives, and one representative of the developer. In an arrangement reminiscent of the one governing the city-owned but privately run Alerus Center, the board of that nonprofit would handle medium- and long-term business for the plaza -- annual budgets, for instance -- and would farm out day-to-day operations to one of the developers’ management companies.

Thames Court, Blue Zones, Waste Management

In related news, council members, acting as the city’s Committee of the Whole:

  • Reconsidered, but ultimately stuck with, an ordinance that will amend the city’s zoning map to accommodate a multi-family rental home development in Thames Court, a subdivision in northwestern Grand Forks, where MAK Capital wants to build a pair of “8-plex”es. Members of the city’s Planning and Zoning Commission worried about the impact of rental housing in that neighborhood. Council President Dana Sande, whose wife Meggen serves on the commission, said he spoke with several neighbors there who weren’t opposed to the plan.
  • Heard an appeal from members of Altru Health System and the Altru Health Foundation for between $1 million and $2 million over four years from the city to pay for consultants from Blue Zones, a Minneapolis-based company that tries to draw lessons from five “blue” regions of the world in which life expectancy is relatively long and apply it to city planning and policy. That money would pay for the foundation to hire five people, plus another two furnished by the company, to put together a plan to make Grand Forks residents healthier.
  • Tentatively approved a five-year recycling contract with Waste Management, a Texas-based recycling company. Council members are set to vote definitively on that contract Sept. 7.

Joe Bowen is an award-winning reporter at the Duluth News Tribune. He covers schools and education across the Northland.

You can reach him at:
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