Hospital transfer agreement completed

Brad Canale, CEO of the Northern Michigan University Foundation, speaks during the announcement of the completion of an agreement transferring ownership of the former hospital site from UP Health System-Marquette to the NMU Foundation. It is hoped that interior demolition work will begin in the winter. (Journal photo by Christie Mastric)

MARQUETTE — Officials on Thursday finalized an agreement that transfers ownership of the former hospital site on College Avenue in Marquette to the Northern Michigan University Foundation.

Under the purchase agreement, the foundation acquired the property from UP Health System -Marquette for $1. UPHS will also give foundation $4 million as part of the agreement.

Terms of the agreement also dictate that hospital staff and services currently housed in the Neldberg Building and the U.P. Regional Blood Center will remain in those facilities for up to 18 months.

The delay gives UPHS time to finalize details for an alternative site in the Marquette area, a foundation press release states.

David Nyberg, executive director for business engagement and economic development at NMU representing the NMUF, called the announcement “a critical milestone” in the process to “enable a public-private partnership focused on building our community’s future.”

John List, president of the Northern Michigan University Foundation Board of Trustees, speaks during the announcement of the completion of an agreement transferring ownership of the former hospital site from UP Health System-Marquette to the NMU Foundation. It is hoped that interior demolition work will begin in the winter. (Journal photo by Christie Mastric)

The partnership focuses on the demolition and development of the 23-acre former hospital site.

“One year ago, focused talks began between the NMU Foundation and LifePoint, and we shared a common goal of getting the site you see behind me into the next phase of what Marquette needs, and that begins with demolition,” said John List, president of the NMUF Board of Trustees, in reference to the College Avenue structures seen outside the window of the Northern Center room where the news conference took place.

List stressed that demolition of the property now is going ahead.

“The interconnected community of Northern and Marquette had a problem: on-site blight in a critical location, both economically and socially unacceptable,” said NMUF CEO Brad Canale, who pointed out that success required “partnerships and goodwill.”

The estimated cost of the demolition is between $18 million to $20 million.

Nyberg said the foundation’s next step is to secure a contractor for demolition. The NMUF board qualified local company, The Veridea Group as its master developer partner on the project.

“We maintain close contact with Veridea about those next steps,” Nyberg said.

He noted that a “taxable business entity” will ultimately own the site and take on the development, and NMUF will become an equity investor.

Nyberg said that ideally, demolition will begin in the winter.

“Of course, there’s a lot of work that needs to be done with respect to procuring a demolition contractor, and that timeline is unforeseen,” he said.

A “best-case scenario,” Nyberg noted, would involve interior demolition — including removal of hazardous waste and asbestos removal — beginning in the winter, with structural demolition starting in the spring.

Canale said demolition is an 18-month project, with the “buildout” of the development set to take between five and seven years.

UPHS-Marquette COO Tonya Darner said the hospital is working with a separate design team to relocate the services provided at the Neldberg Building and the blood center.

“While they can start their demolition on the south campus of the property, there will be a delay just specific to relocation of those remaining services,” Darner said.

Canale addressed the issue of what type of development ultimately will be at the site.

“What will determine the final composition will be the market going forward, and the various elements of what’s possible on that site, but certainly, all types of housing are envisioned,” Canale said.

Nyberg pointed out that comments brought forth at public engagement sessions and meetings with officials dealt with housing concerns.

“We heard it loud and clear from residents and community members that housing is of high interest,” he said, noting a desire for a wide spectrum of housing.

“There’s still conversations that are occurring, and the intent expressed by all parties here, to continue those conversations, even beyond this milestone here,” Marquette City Manager Karen Kovacs said.

The NMU Foundation has established a website to share information about the project to-date, along with anticipated next steps. Included on the new site, www.RenewCollegeAveMQT.org, is information about the agreement as well as public access to reports and documents related to its work of aligning relationships and resources required to facilitate demolition and site preparation of the former hospital site.

In addition to demolition work, next steps in the process include Michigan Strategic Fund action and approval on Michigan Economic Development Corporation recommendation to invest in blight-elimination costs, officials said.

The steps also involve MSF action and approval for economic support as authorized under the Michigan Brownfield Redevelopment Financing Act, including state and local tax increment financing to reimburse brownfield-eligible activities such as demolition, site preparation and public infrastructure construction.

Steps toward redevelopment will begin in early 2023 to address pre-development planning, active community engagement, and establishment of a taxable business entity led by Veridea Group to include equity investments through NMUF and other potential partners.

“This goes beyond making sure that this site right next to Northern is protected,” Canale said of the project. “It really is a significant economic potential impact for the entire community.”

Christie Mastric can be reached at 906-228-2500, ext. 250. Her email address is cbleck@miningjournal.net.


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