Core Spaces Says It’ll Do Better as Complaints about The Hub Mount

Thursday, September 5, 2019, 10:24 am
By: 
Brad Minor and Alice Dreger

Photos of The Hub by Raymond Holt.

“It’s been a disaster.” That’s how a number of residents have described the move-in experience at one of East Lansing’s newest big developments, The Hub on Campus.

The problems have been big enough that East Lansing’s City Council decided to put the issue on its agenda Tuesday night. City staff subsequently dedicated more space to it than any other topic in this week "Council recap" mailer.

Chief among the complaints against Core Spaces, the developer and operator of The Hub, have been dysfunctional elevators, trash stacking up, construction dust, and an unresponsive management staff. Most residents had to wait hours on a line just to try to move in.

Staff from Cores Spaces came to City Council on Tuesday night to apologize and defend the company. More than this one Hub project is on the line. Core Spaces has just submitted an application to build two more The Hub towers – bigger than the one just opened.

If approved, apartments for 1,700 more MSU students would be constructed in additional Hub projects on Bogue Street, just south of the recently-opened project.

Council questions whether they really want to see more built by Core Spaces

The experience of the last few weeks with The Hub has left a sour taste in the mouths of Council members.

Council member Shanna Draheim explained at this week’s meeting that promises from Core Spaces of quality onsite management and good communication were reasons that the first Hub project had gotten the support of the Council.

She said that she expected Council would be wary of approving another project by the same developers if outstanding issues are not rectified in a way that signals systemic improvement.

Mayor Mark Meadows agreed, saying, “My expectation is that we will get a report that states how you have systematically addressed each one of these problems because, like [Council member Aaron Stephens], I'm thinking, why would we ever open another Hub? It just doesn't seem to be something that pays off for the City.”

But in a later discussion on housing issues in the City at the same meeting, Council members Ruth Beier and Erik Altmann alluded to what makes The Hub attractive to City leaders: it’s student housing in an area without owner-occupied houses, and it pays big taxes.

The Hub was constructed without tax increment financing (TIF), which means it will immediately start paying hundreds of thousands of dollars a year into the City’s coffers.

By contrast, all the eligible local taxes from The Landmark (below) in the Center City District project will be diverted for thirty years to pay for that project. Because of how that deal with Harbor Bay Real Estate was structured, City taxpayers will be subsidizing the "luxury" student housing in The Landmark in the coming year.

Core Spaces’ The Hub projects are therefore a relative goldmine for East Lansing.

Said Beier on Tuesday night, “They don’t need TIF and they never asked for TIF.”

She suggested that the City could bargain with Core Spaces to get even more than taxes out of another Hub project – like having Core Spaces buy out rental licenses in areas with many owner-occupied houses, to convert student rental houses to owner-occupied homes.

Altmann agreed with her idea, saying, “That’s exactly what I was getting at” as he suggested there might be a way to use taxes from a new Core Spaces project to deal with wider housing concerns in the City.

Residents of The Hub describe negative experiences

Council member Aaron Stephens has been spending time at The Hub talking to residents there, and he asked a number of them to come to Council this week. He specifically asked MSU student Sarah Shankie to describe her experience.

“About a week ago, me and some of my friends were stuck in one of the elevators for almost an hour,” Shankie told Council. “There were seventeen of us total in the elevator, but we did the math, and we were under the weight limit,” she said.

“There is a sign now outside the elevator saying that the maximum occupancy is nine people, but that wasn't the case a week ago.”

She said the people in the elevator tried to push the emergency button, but that it wasn’t working. There was no cell phone reception in the elevator, so the trapped people started pounding on the doors until somebody went and got help. The whole ordeal lasted about an hour, she said, and management didn’t want to talk to them afterwards.

“I was terrified hearing these stories,” said Stephens from his Council chair. “Imagine as an elected official hearing the story of constituents you're supposed to protect being trapped in an elevator for an hour with an emergency button that doesn't work.”

The building has three elevators, but not all have been working at the same time. At one point, all three were out of commission, leaving residents to trudge up and down stairs.

Called to the podium, East Lansing’s chief building inspector, Scott Weaver, explained that the building only required two operational elevators to open, and that the State, not the City, handles elevator inspections.

Weaver also explained that he would not have allowed the building to open if he and his team had not found that the building was safe and ready. He said he did not find the kind of extreme dust problems residents are describing.

Core Spaces says it will do better

Rodney King, Senior Vice President of Development, came to Council with other members of his staff to apologize and defend the company.

“We absolutely own the move-in experience,” King told Council. “It absolutely did not go as planned, and we do apologize for that. We expected the TCO [Temporary Certificate of Occupancy] earlier in the day and that did not happen. We got the TCO late in the afternoon and the plans did not go as we would have hoped. We understand that it was a bad experience for the majority of our residents and we apologize," King said.

Below: Rodney King of Core Spaces.

King went on to say that, during move-in week, management tried to do what it could and to compensate the residents by “giving them fifty-dollar gift card to Target if they needed to go get something.” He also said that they would have provided reimbursement for lunch and hotel accommodations if residents provided receipts.

Email to residents from Core Spaces and stories shared with ELi confirm that at least some residents received offers for lunch reimbursement and Target gift cards.

But Sanjana El, a grad student who moved from California, said that she had not been offered any form of compensation. She said that communication had been terrible and that, while Core Spaces had promised helpers and carts for move-in, there were no helpers and the carts turned out to be “cardboard boxes on wheels.”

According to her, residents stole move-in carts from MSU dorms. “We still have those carts,” she said.

Trash was also named as a serious problem by El. She showed City Council pictures on her phone. She also said that her closet was not yet finished, even though she was supposed to have “customized closet organization.”

“So your apartment was incomplete when it was provided? Mayor Mark Meadows asked.

“Yes," she replied. She also noted that her floor, the ninth, was supposed to have “restricted access” but that anyone could enter.

The complaints have not arisen only at Tuesday’s meeting. Angry residents can still be found in and around The Hub.

“The whole thing was just a disaster from start to finish, and I wish I would just get out of this lease,” one resident interviewed by ELi said.

“Are there any plans at this point to offer any compensation for the issues they have had?” Stephens asked on Tuesday.

Core Spaces’ Vice President King responded, “We take it by a case by case basis. We will see what their issues are and walk their units with them, if they're willing, and at that point, we can discuss compensation as well.”

“It sounds like there are problems with the building but also problems with the people running it. What do you say to the allegations that people have emailed the management company and haven't gotten any response?” Altmann asked.

“I’d have to dig into it more, King replied. “I know they were bombarded. It may have gotten lost but that's no excuse.”

 

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