Park District: Facts of Life

Evergreen Properties (reprise)

The city will not be building a large, bond-financed parking structure on the site of its Evergreen properties. The Evergreen properties could generate $300,000 in net operating income if repurposed and well managed. To compensate, a private developer who wants a parking structure would need to pay the city $5,000,000 for just those properties (assuming 6% debt service on refinanced bonds) then construct and manage the structure, which no developer will do. So, for all the bravado of not being willing to consider the option of keeping the Evergreen properties, the Evergreen properties will be keeping to themselves.

DTN Land Cost Valuations

The DTN Park District proposal provides an appraisal of fair market value ("land costs") to purchase various private and public properties, the city's Evergreen properties not among them. Lot 4 (0.19 acre, 8250 sq. ft.), next to Dublin Square, where DTN wants to put what looks like high density student rentals (20 units on 4 upper floors, first floor commercial, no parking), is valued at $1.5 million.

Total land cost for all the properties that are slotted for the 10-story Building A on Grand River is set at $7.5 million for 1.1 acres (according to city assessment records), replacing the 6 Strathmore-affiliated Grand River properties (tax parcels), plus the city's Little Bank Building (303 Abbot). The Little Bank Building is 0.18 acre, so this works out to $1,227,273 fair market value.

Selling the Little Bank Building

This land cost appraisal is very good news, because the City of East Lansing only owes MEDC about $420,000 (including interest). The $800,000 surplus ($350,000 of it at the expense of a write-down by state taxpayers) would go toward partial payment of the debt on the Evergreen properties, making it plausible to come close to breaking even on the bonds (after refinancing in April 2015), with strong net operating income.

If city hall had a lick of common sense, it would put sale of the Little Bank Building on the November ballot, which would nullify the likely legal and political battle over the use of the DDA to get around the city charter (a recall election just needs citizens angry at being held in contempt). Documents show the Core Communities Fund financing agreement (CCF-123) for 303 Abbot is between MEDC and the City of East Lansing, with documents signed by the former city manger, not with the DDA, signed by its chair. If sale at fair market value is stipulated, now that we know fair market value is well above what is owed, voters will almost certainly approve the sale -- nobody wants to keep the Little Bank Building. It is hard to believe there is anybody in city hall, except Triplett and, I suppose, the city attorney, who still wants to cling to using development authorities to get away with stuff of which the public would not approve, and even the would-be developers know they would be better off with public affirmation.

The Little Bank Building is Redevelopment Government Needs to Do, Parking Lots Are Not

Again, the Little Bank Building is the only city owned blighted property, the only city owned property where development needs to be done. It is also the only city owned property that is integral to redeveloping the blighted private properties. Evergreen Arms can be redeveloped on its own, whether as student apartments or something else, with adequate self-contained parking and no need to expand onto Lot 8. Redevelopment of the Grand River properties requires neither Lot 4 nor Lot 8. Perhaps a case can be made for Lot 4 and the Little Bank Building being developed together, without the Big Bank Building, as with the Lurvey-White and Studio Intrigue proposals, but that won't help with the Grand River blight. Lot 8 is totally separate.

Walking around the so-called Park District makes it apparent there is no cohesive district, with or without the private properties, just a bunch of separate parcels that, with a few combinations, could be developed separately. The only urgency is with the blighted properties, not the parking lots, which are simply development government wants to do and can wait, unless there is a project (such as a retirement community but definitely not student rentals) that could garner strong community support.

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