Yesterday, the Grand Rapids Press reported that the Icon on Bond condo project faces foreclosure. The bank that loaned the money for the project says that the father-son development team built the project, Joseph A. and Joseph W. Moch, owe more than $40 million–even after getting tax breaks from the city government.
The Mochs launched the project with hopes back in 2003, saying that it would bring critical a critical development. However, the project has largely failed to deliver and has been a source of controversy for years. According to the Grand Rapids Press, only four of the 118 units have been sold and 50 have been leased.
Back in 2006, the project won tax credits from the city:
Moch International, led by the father-son team of Joseph A. and Joseph W. Moch, won approval for $1.7 million worth of tax credits and rebates to help build a $15.5 million, 171-unit apartment complex at 235 Grandville Ave. SW.
They won these tax breaks even after the Mochs “threatened” to build low-income housing if they didn’t get their way on two previously planned towers:
By an 8-1 vote, the city’s Planning Commission sunk Moch’s request for permission to build two 255-foot-tall towers that would house 398 apartments in the tax-free Renaissance Zone.
Moch said his new project will fit the city’s 165-foot height restrictions for downtown buildings. They will be aimed at low-income residents or “whoever can afford them,” he said. He estimated the new project would be about 17 stories high.
“There will be no doorman, no heated sidewalks,” he told reporters. Parking will meet the city’s minimum requirements and probably cause problems on surrounding streets, he said.
Asked if he would build federally subsidized housing on the land, Moch replied, “We are seriously looking at that.”
According to the article in the Press yesterday, the Mochs are hoping to get out of the deal, “Moch said he’s prepared to hand over the building and resign from the condo association board, if that’s what’s required.”
It’s really too bad the bank won’t just take this building back and give it to the city’s homeless–on the Mochs’ tab of course. It seems like the fair thing to do.
At the very minimum, hopefully the city takes these development projects a little more seriously in the future before awarding them tax breaks.