Convexity Submitting New Plan for Park District

Friday, February 17, 2017, 2:38 pm
By: 
Chris Root

According to the City of East Lansing’s development staff, Convexity Properties is preparing a new, less costly plan for its blighted properties at the corner of Grand River Avenue and Abbot Road. The staff reported this at the public meeting of the Downtown Development Association (DDA) Project and Infrastructure Committee yesterday, February 16.

This news does not come as a surprise, although it does provide some details of what is to come. As Eli reported last month, Convexity told the City that it was “significantly” changing its plans because they and the City Council were far apart on the financing of the project, which involves both privately- and publicly-owned properties.

City Development Administrator Lori Mullins said the large building at the corner across from the main entrance to Michigan State University will still be a 12-story structure with a 157-room hotel and between 145 and 177 residential units. The smaller number of residential units might be possible if some office space is ultimately included.

The major change in this building’s plan is that more parking spaces will be included and all the spaces will now be above ground. Underground parking is much more expensive to build than above-ground parking. This change will significantly affect the design of the building.

The original plan had included one level of underground parking plus some spaces in a new parking garage to be built as part of this project on Evergreen Avenue, where there are now student rentals owned by the DDA. The parking structure is no longer part of Convexity’s plans, according to Mullins. Dropping plans for the separate parking structure requires that more parking be provided within the building itself.

A second building had been planned by Convexity for their properties across from Valley Court Park, at 341-345 Evergreen Avenue, where the Evergreen Arms apartments used to be. This building also will be redesigned to have parking spaces on the first floor. (For a larger view of the map shown below, click here.)

This second building probably will now be six stories, with parking on the first floor, residential units on floors two through five, and amenities for residents, such as a gym, on the 6th floor. In the most recent plans, this building was four stories. Convexity proposes that this building be condominium units or rentals for visiting faculty or professionals, for which MSU would hold a master lease.

The main change in Convexity’s anticipated new proposal is that it does not include a publicly-owned parking structure. This garage was included in previous iterations, to be built on land that the DDA purchased for this purpose in 2009, properties on which the City now has $5.6 million in debt.

Mullins said yesterday to the DDA members present that Convexity had never been interested in building this parking structure, but the City had encouraged them in the development of the last set of plans to incorporate it in their project. Then, last month, the City Council passed a 30-year Tax Increment Financing (TIF) plan for the project in which the vast majority of expenses that would be reimbursed out of additional property taxes were for construction of the parking structure, refinancing the bonds on the DDA-owned land, and water and sewer infrastructure – all of which would be owned by the City and would not yield any income to the developer.

Mayor Mark Meadows said at the time of the Council’s vote on the TIF that the ball was now in Convexity’s court. This revised project, one that includes less public infrastructure redevelopment and no public parking, is Convexity’s response.

Some DDA members expressed disappointment yesterday at the news of this change, and the tone of the meeting was generally subdued. Brad Ballein, who owns the building across Abbot Road from the main site, said the DDA bought the properties on Evergreen Avenue as part of a big vision for development for this end of downtown that is not going to happen now.

DDA member and former mayor Doug Jester had a different perspective, saying Convexity’s new plans are not a lost opportunity to do what we hoped would happen at this location so much as it is partial implementation. He pointed out that the size and function of the large building Convexity plans to build is little changed.

City Manager George Lahanas said that the new project probably will be a “big missed opportunity” and that the building design probably will be less aesthetically pleasing because it incorporates first-floor parking.

Jester stressed that the DDA and the City would need to begin making plans for the remaining publicly-owned properties as soon as possible after decisions are made about the Convexity project. This planning should include the DDA-owned Evergreen properties and two City-owned parking lots on Abbot Road – one at the corner of Abbot and Albert (next to Dublin Square) and the other north of the AT&T building, across from City Hall. Short-term plans for these properties should take into account a longer-term vision.

The DDA will also discuss at its meeting next week the design of a traffic study for this end of downtown and along Abbot Road perhaps as far north as Saginaw Avenue. Jester argues that both the City and future developers need to understand future traffic and pedestrian conditions as well as parking needs in this area. Jester has urged that this traffic study be done for the last several months.

A common concern expressed by members of the DDA and City staff at Thursday’s meeting was that the refinancing of the $5.6 million bond must somehow be included in the Convexity project. This would require that what is done with the DDA-owned land in the immediate future be of some benefit to this project.

City staff expect to receive new architectural drawings from Convexity by February 27 and engineering plans by March 3. This will allow the staff to prepare a report so the Planning Commission and DDA can consider the proposal in March.

Many issues remain before the Convexity plans can be approved. The Planning Commission’s consideration of the site plan will start from scratch. The City Council will need to adopt a new TIF plan along with the site plan. A development agreement needs to be reached by the developer, the City Council, and the DDA and Brownfield Redevelopment Authority (BRA). (The DDA and BRA are comprised of the same members.) Among the many issues included in the development agreement will be the sale price of the DDA-owned property at the corner of Abbot and Albert (the former “little bank building), which the developer presumably will still need for its large building.