Port Huron considers selling top half of city hall

Port Huron city leaders are considering a partial sale of the Municipal Office Center at 100 McMorran Blvd.

Port Huron city leaders are considering a partial sale of the Municipal Office Center at 100 McMorran Blvd.

By Tony Wittkowski | Local Government Reporter | The Times Herald

With a view of the Blue Water Bridge and passing freighters, the Port Huron Municipal Office Center has a location that is hard to beat.

And city officials are looking at the possibility of offering a portion of it to private owners.

City Manager James Freed calls it a “conceptual idea,” at this point. But he’s determining if it would be possible to sell the top three floors of the building at 100 McMorran Blvd. to a private developer who might turn it into condominiums or high-end offices.

“The idea would be to consolidate city offices to the bottom three floors and develop alternative uses for the top three,” Freed said. “The second goal would be to sell the building outright to a private developer.”

The idea of partially selling the 88,000-square-foot building came after Freed met with regional developers to look at what could be done to the top floors. Freed hopes the building can be sold partially or outright within the next three to five years.

Freed said because the city has no use for the top three floors and because there is a surplus of office space downtown, developers would need to change the use of those floors.

The option of selling the entire building has been on the table for years, but Freed said a sale isn’t likely because the city hasn’t been able to find a developer that could afford it.

Ed Brennan, director of finance, said the building is insured for $21.4 million this year and cost $13.8 million to build in 1978.

An asking price for the building has not been determined.

By moving city offices into the bottom three floors, Freed said the cost of the top floors might be more attractive to developers.

Putting the property into private hands also would mean putting it on the property tax rolls.

“This is the most desirable place for development in the city,” Freed said. “It’s right on the water. We want to be able to tax this property.”

The city has kept an eye on available office space that could allow for a smooth transition if the building were sold outright. Freed would not say what building that would be.

“This real estate isn’t the most appropriate place for government,” Freed said. “We can operate from a much more modest location. When I say more modest, I mean something smaller and not on the water.”

Gary Fletcher, the city’s lawyer, said the city could legally own part of the building and a private investor could own the remainder.

However, he said, the voters would have to approve the sale.

“The city can sell surplus property,” Fletcher said. “The issue falls on a charter amendment and would require it to go to a vote to the people.”

Mayor Pauline Repp said the proposal to sell the building became serious when the city listed the building for sale eight years ago.

The building did receive an offer, but it was too small, Repp said.

The city manager, public safety and forestry and parks departments occupy the fourth floor. The state of Michigan leases the fifth floor, and Michigan Works! leases the sixth floor.

Repp said while the state leases the majority of the top two floors of the building, Gov. Rick Snyder is proposing a change in districts that would move those offices to Macomb County.

“We could find ourselves facing that scenario,” Repp said. “This is all in concept right now, so there is no concrete plan to turn those floors into apartments.”

The building is six floors, plus a basement that currently houses the city police department.

In 2002, Port Huron had 324 full-time employees. It now has 235 full-time employees, and the city office building is about 70 percent occupied.

“It’s different now than 10 years ago because we have been able to consolidate so many jobs with the use of technology,” Repp said. “We don’t need all that space in the building and we do have state offices that rent the fifth floor and part of the sixth floor. If they were to go away then we would have vacant spaces.”

Thomas Tocco visited the Municipal Office Center for the first time Wednesday to pay a parking citation and was surprised by the size of the building.

The Port Huron resident said he wouldn’t mind seeing the city sell it and move further into town.

“I always wondered why this building was tucked away as opposed to main street,” Tocco said. “I think it might be a good idea business-wise to sell them out as condos.”

Port Huron resident Cassandra Long said selling half of the building is something she has never heard of before, but supports.

“If there is space that is available then why not? It would be beneficial if larger cities did this as well,” Long said.

Contact Tony Wittkowski at (810) 989-6270 or twittkowsk@gannett.com. Follow him on Twitter @tonywittkowski.

(Author’s Note: This article was originally published on Feb. 25, 2015)

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