Future of Bailey Parking Lot Uncertain

The City of East Lansing’s lease on the private land beneath the Bailey Street Parking Lot will expire in June of 2020 and, as of now, it’s unclear whether the owners of that land are interested in renewing the lease.

The lot is the last large surface lot in East Lansing’s central downtown, and has been used for the art and jazz festivals since the Center City District project led to the closure of Parking Lot 1.

The parking lot, known as Lot 11, is at the southwest corner of Albert Avenue and Bailey Street. On the south side, between the lot and Grand River Avenue, stands a series of one- and two-story commercial buildings that include The Peanut Barrel, Chipotle, an MSUFCU branch, Evergreen Cycle, and other businesses.

Back in April 2000, the City entered into a lease agreement for four parcels of downtown property owned by the Metzger and Fabian families, for the purpose of building this surface parking lot. The houses on the site were demolished and the Bailey Street parking lot was built.

The five-year lease, which in 2000 was written for an annual lease payment of $79,869, has been adjusted yearly for inflation. By 2016, the annual rent for the four privately-owned parcels of land was up to $113,490.

The City has opted to renew the lease three times, as the terms allowed. But three renewals are the maximum allowed under the original lease. It’s unclear what will happen now that the final renewal is about to expire.

According to documents that ELi obtained under the Freedom of Information Act (FOIA), Tim Dempsey, East Lansing’s Director of Planning and Development, raised the issue of the renewal in a letter to the property owners in April of 2015. That was when the final renewal of the lease was executed.

“Given that we are entering the final lease period,” Dempsey wrote, “I would suggest that we start to consider what happens in 2020. As I have communicated previously, the City may have interest in purchasing the land.”

His letter continued: “Barring a purchase, we would certainly consider a continued lease agreement. However, under that scenario we would want to look at adjusting payment terms to help address needed capital improvements and fluctuations in utilization and revenue.”

The issue of renewal was raised again an email between Dempsey and property owner Kristen Metzger in March of this year. At that point, Metzger offered to set up a time to talk about the lease after tax season, but if that conversation took place, documents provided under FOIA don’t show a record of it.

Metzger declined to comment for ELi on the status of the lease, and Tim Dempsey also did not reply to our request for information.

The land is one of the last open spaces in downtown East Lansing, and as a consequence, it could be seen as very valuable to potential developers.

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