The former Bertha Vos Elementary School in Acme Township could soon be turned into residential housing after Traverse City Area Public Schools (TCAPS) trustees voted unanimously Monday to accept a $1,225,000 cash offer for the property from Strathmore Real Estate Group. The offer is $500,000 over the listed asking price of $725,000. Strathmore – the company behind the redevelopment of the Kmart property and a 186-unit planned housing complex called Oak Shore Commons in Acme – intends to convert the school building into residential units, according to Scott Hardy of Coldwell Banker Schmidt Realtors.

TCAPS officials reviewed three offers for Bertha Vos after trustees voted in October to list the building with Hardy. The details of the other two offers were not disclosed publicly Monday, with Hardy saying Strathmore’s cash offer was the “one we felt is worth accepting and moving forward with.” It wasn’t just the price but the company’s commitment to the site that put Strathmore in front, Hardy said.

“It could be $10 million (for the offer) – if it doesn’t close, it really doesn’t make any difference,” he said. “So the other thing we did in this process was vet the potential buyer (and) do an assessment of the likelihood that they would close on this purchase.” Hardy said Strathmore – listed under SH East Bay Commons North LLC in the purchase agreement – is already in discussions with Acme Township about the site and has a relationship with both the township and Grand Traverse County due to the Kmart redevelopment. “They are a known commodity in Acme Township,” Hardy said.

The offer comes after Acme Township trustees voted to end negotiations this fall with TCAPS for Bertha Vos as a potential site for a new township hall. Township trustees cited repair costs that – when combined with their agreed-upon $600,000 purchase price – would have required an estimated $3 million investment to make the building usable, which Acme couldn’t afford. The township is now pursuing buying the Ascom office building at 6100 US-31 North for the new township hall.

Hardy acknowledged many of the costly repairs that dissuaded Acme from moving ahead will need to be addressed by Strathmore, such as replacing the roof and updating mechanical systems. The plumbing that connects to most classrooms was a “big plus” and is something the developers can tap into and use for residential conversion, Hardy said. Still, due to the cost of rehabilitation, Hardy said he couldn’t speak to the type or affordability of housing that might come to the property.

“I think residential housing in that area is a plus,” he said. “How affordable that becomes will ultimately be decided by how much they have to invest in doing (those repairs). But they are committed to making sure that we address the concerns that the whole region has about housing. Again, (the price range) is up to them. They’ve spent a million-two on the property, so they’re going to have also then figure out what they can afford to do.”

The purchase agreement includes a 120-day due diligence period. Hardy said Strathmore has already begun some of that evaluation work and is reviewing allowed uses under the zoning ordinance. “From everything I understand...they’d repurpose the building,” he said. “That was the best way to get the highest and best use out of that property, was to retain that building there. There are also building sites that are available to them if they wanted to pursue that.” Hardy said Strathmore indicated they might close sooner than the agreement deadline or “at least waive their due diligence.” A cash offer means that closing also won’t be hampered by financing contingencies, Hardy noted.

Hardy said another bidder declined to take the backup offer position on Bertha Vos, but might return to the table if the Strathmore deal falls through – leaving the door open for other options in the future if the sale doesn’t close. Still, multiple TCAPS trustees expressed optimism about the Strathmore offer. Board Secretary Josey Ballenger said that even though details aren’t available yet on what the residential development might look like, she was “excited about the housing possibilities” for the site. Trustee Erica Moon Mohr also called it a “great offer,” adding: “I feel very thankful, coming from what we have had on the table in the past.” In a brief written statement to The Ticker, Strathmore principal Jacob Chappelle thanked TCAPS for its consideration of the firm's offer, saying the company "hopes to redevelop this functionally obsolete site to provide more needed housing."