Traverse City Approves RFP to Redevelop Six Downtown Parcels with Housing, Parking

Six downtown parcels that a developer offered to buy for $1 are heading instead to competitive bidding. Traverse City commissioners voted Monday to approve a formal request for proposals for the West State and Pine streets site, capping a debate that stretched over an hour and touched on green energy policy, building height limits, and whether the city could recoup its $7.6 million land investment.

Those parcels, assembled for $7.6 million from city parking funds, cover just over an acre and have sat largely idle since the Downtown Development Authority first called for a west-end parking garage in 1997. In 2023, the DDA spent nearly $1.6 million on schematic designs by engineering firm Fishbeck and Cornerstone Architects for a concept with 534 parking spaces and 56 housing units, only to shelve the plan when parking operations returned to the city.

The competitive process gained momentum in December 2025, when developer John Socks of ShoreNorth Development proposed acquiring the parcels for $1 in exchange for building parking and workforce housing, financed privately through a tax abatement or PILOT arrangement. City Manager Benjamin Marentette pushed back, encouraging commissioners to pursue an open process "rather than solely negotiating with one party who approached us first." Commissioners agreed in January and retained consultant Rob Bacigalupi of Mission North LLC, a former DDA executive director, to structure the RFP framework after a February study session.

The approved RFP requires public parking and workforce housing with long-term affordability protections, and bans short-term rentals by deed restriction. A scored criterion includes space for a Traverse City Police Department substation. Developers must submit a full fiscal impact analysis covering projected tax revenue and proposed subsidies, so the commission can compare proposals beyond purchase price alone. The city's Building Electrification Policy, which mandates full electrification through Traverse City Light and Power, applies to any land sale, though commissioners may grant case-by-case exceptions.

An $800,000 state environmental assessment grant tied to the site expires in August. DDA officials said they would seek an extension; the grant is listed in the RFP as an available incentive for the selected developer.

Housing North puts the area's median rent at $1,695 per month against a shortage of more than 2,600 rental units, and the median home price at $392,500 against a for-sale gap exceeding 7,100 units. Two new hotels and more than 100 residential units are already under construction in the immediate area, intensifying demand the RFP is meant to address.

The RFP posts April 13. Proposals are due June 11, with commissioner selection anticipated in July.