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Tuesday, 18 October 2016 12:18

VanGessel works strategic partnerships for large developments

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Mike VanGessel, CEO of Rockford Construction Company Inc. Mike VanGessel, CEO of Rockford Construction Company Inc. Courtesy Photo

Finalist | Dealmaker: Executive

Mike Van Gessel, CEO, Rockford Construction Company Inc.

  • Annual sales: $523 million in 2015
  • Total employees: About 270 full-time employees
  • Business description: General contracting, development and property management firm with offices in Grand Rapids and Bonita Springs, Fla.
  • Personal info: Wife, Gayle; three children
  • Education: Bachelor’s degree in construction management from Michigan State University
  • Community involvement: CEOs for Cities, Davenport University Foundation, Grand Valley State University Foundation, Legacy Trust, Michigan State University West Michigan Campaign Leaders, The Right Place Inc., Talent 2025, West Michigan Environmental Leadership Network, West Michigan Policy Forum
  • Advisers: Rhoades McKee PC (legal); Crowe Horwath LLP (accounting); Works with several banks

Mike VanGessel likes to talk about the “why” behind his company’s decision to invest in the long-neglected west side neighborhood of Grand Rapids.

That could be because the “how” makes for a significantly more complex story. 

Three years ago, the west side native and CEO of Grand Rapids-based Rockford Construction Company Inc. opened the firm’s ultra-modern headquarters just blocks from where he grew up.

Since that time, the general contracting, development and property management firm — as well as several strategic partners and other investors — have left their mark along Bridge Street and Fulton Street, where new mixed-use projects seem to pop up daily. 

In mid September, the company opened the first phase of perhaps its most ambitious project in the area: a $25 million mixed-use development featuring apartments, office and commercial space, and a massive 40,000-square-foot satellite taproom and production facility for New Holland Brewing Company LLC of Holland.

“So how did we do that? We had some setbacks — two steps forward, sometimes, and one step back,” VanGessel said while sitting for an interview in one of the several bars featured in the New Holland Brewing space. “We had hoped that this would be one of the first things that got done on the west side, and that’s not quite what happened. This was a complicated deal.”

Specifically, VanGessel, along with New Holland Brewing President Brett VanderKamp, a partner in the development, had to figure out how to structure the project. 

New Holland Brewing wanted to own its space, while a Rockford Construction subsidiary would own the rest of the project and the land it sits on along Bridge Street between Turner and Summer Avenues. 

The site was formerly home to a lingerie and adult store, which VanGessel thought did not represented the “west side brand” he had grown up with and hopes to bring back, at least to some extent. 

Additionally, the partners had to rework their deal several times with the Michigan Strategic Fund, which ultimately committed $2.5 million in loans to the project.

Ultimately, VanGessel credits his development partners with getting the project over the finish line. 

“I think what was driving all of that the entire time was understanding the value of unity in this,” VanGessel said. “We really needed to stay nimble in those negotiations to get to a situation where it was a win-win-win. I think that’s where we ended up. We’re really pleased with the project and its impact, but we’re also pleased that it’s a real estate deal we understand makes sense.”

Strategic partnerships and creative development tactics such as the New Holland Brewing deal made VanGessel a finalist in the 2016 MiBiz M&A Deals and Dealmakers of the Year Awards in the executive category.

“I think people outside the business don’t realize the non-linear fashion of development that happens,” Jennifer Boezwinkle, Rockford Construction’s vice president of communications, said of complex deals such as the New Holland project. “Somehow, miraculously, through all these different series of twists and turns, everything will finally come into place all at the same time.  … And I think what carries you through some of those difficult times where something goes wrong or something doesn’t align … is that trust you build over the course of a relationship.”

The New Holland Brewing space directly overlooks the recently completed 61-unit Lofts on Alabama apartment development, a 616 Lofts LLC project that also involved Rockford Construction.
616 Lofts partnered with Rockford Construction to buy the land for the development in addition to serving as the project’s construction manager. 

“It’s a win-win-win,” VanGessel said of the 616 Lofts partnership. “They brought a new set of investors in, they get to enjoy a good project and we’re very happy for them.”

Now with the New Holland Brewing and 616 Lofts projects wrapping up, VanGessel and his company will soon commence work on a series of new developments a few blocks west along Bridge Street.

As MiBiz has previously reported, the company and a variety of partners including grocery chain Meijer Inc. and nonprofit affordable housing developer Inner City Christian Federation (ICCF) will come together for what VanGessel has described as a “superblock” project. 

Current plans call for the mixed-use project that will include apartments, office space, a Meijer store and parking to be built on the mostly-vacant block bordered by Bridge Street and First Street from Seward Avenue to Stocking Avenue. 

Overall, VanGessel said the partnerships and strategic maneuvering needed for the New Holland project will be just as necessary on the next planned development. But the addition of a grocery store and affordable housing options excites him.

“The next project is significant. It takes a lot of attention and that’s where we’re at,” VanGessel said, adding that having a variety of housing types as part of the development is critical. “At the end of the day, you need to know you’re competing with other developers, so that’s part of the plan. But you’re also trying to do the best thing for the community.” 

Read 3719 times Last modified on Wednesday, 19 October 2016 10:36
Nick Manes

Staff writer

nmanes@mibiz.com

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