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Setbacks have long marred the development at Park District

January 26, 2017
Supply chain management junior Dante Assade walks on Feb. 9, 2016 on Abbott Road. Kendick was headed to class.
Supply chain management junior Dante Assade walks on Feb. 9, 2016 on Abbott Road. Kendick was headed to class. —
Photo by Kelly vanFrankenhuyzen | and Kelly vanFrankenhuyzen The State News

Changes to the now-passed brownfield reimbursement plan led David Pierson, attorney for project developer Convexity, to call the project unworkable. Pierson is also the attorney for The State News. 

The parties are continuing to deliberate terms for a development agreement, but the latest dispute threatens to again derail plans to rid the city of its “eyesore.” This is not the first time the city and a developer have had troubles moving a plan forward.

The original project for the site, City Center II, was announced in 2001 and was followed by several years of planning between the city and developer Strathmore Development Co. After many changes and revisions based on public opinion, the project fell apart after the Great Recession of 2008.

Numerous setbacks and extensions unfolded as a result of Strathmore’s financial woes, and the developer was ultimately unable to secure enough funding to reliably move forward with the project. Strathmore officially withdrew in June 2012, and City Center II was pronounced dead.

“That developer tried several times to make the project go, and that didn’t happen,” East Lansing City Manager George Lahanas said. “Credit markets dried up, everything dried up. It was very difficult to do anything, and this developer couldn’t get the project going.”

In October 2012, the city began to accept applications for a new project to replace City Center II, with DTN Management eventually being chosen as the developer for the new Park District project in August 2013. 

DTN’s $100 million proposal called for a 10-story building with hotel space, as well as a 400-space parking structure. However, just more than a year later, DTN withdrew from the project after residents rejected a proposal to sell the developer three public parking lots for construction purposes.

Not about to call it quits, council approved another plan for the site early 2015, then a year later reached an agreement with the new property owner, WGR Finance, to have the buildings taken down by Dec. 31, 2016. The City and WGR both took down smaller properties they owned in the Park District area in July 2016.

However, WGR and their developer, Convexity, both owned by Chicago-based DRW Trading Group, sought an extension for the demolition deadline in order to pursue a $10 million Michigan Business Tax credit.

The deadline was extended to Jan. 31 and is expected to be extended again at that day’s council meeting should the city and Convexity continue to find common ground on the project. 

The developer’s current plan calls for a 12-story mixed-use building with hotel and retail space, a parking garage and condominiums. 

The project’s site plan has been approved and will likely go forward as long as council and Convexity can finalize a development agreement on terms that suit both parties. A vote on the development agreement is scheduled tentatively for the Jan. 31 council meeting.

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