Here’s latest on the controversial sale of the Ann Arbor Library Lot to Core Spaces for $10 million.
The Library Lot is 0.8 acres.
East Lansing Lot 1 was 1.35 acres.
If East Lansing had followed the city charter and asked voters to allow sale of Lot 1 and sold for a comparable per-acre value, the city would have received $16,875,000.
On paper, based on value of the recent sales of the private properties for the Harbor Bay project, Lot 1 would be worth $18 million. Local commercial real estate experts estimated it would have sold for ~$15 million.
If the city had sold Lot 1 to Core or another student rental developer for $16,875,000, then put the money toward pension plan, at 7% return (approximately what MERS uses), over 20 years, this would have reduced pension liability by more than $65 million.
It appears Core will not receive tax breaks for the Library Lot project. With no tax breaks for a Lot 1 project of the Harbor Bay size, this would more than make up for any lost parking revenue or the $4 million over 20 years in lease revenue.
Put simply, it looks like the Lot 1 Harbor Bay deal has cost the city at least $50 million, maybe $60 million or more.
– Eliot Singer