New Renderings and Draft Contract Released on MSUFCU Land Sale Deal

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Saturday, February 15, 2020, 3:55 pm
By: 
Alice Dreger

The Michigan State University Federal Credit Union has released new renderings of the office building it wants to construct downtown on what is now a piece of publicly-owned land. The draft contract for selling the public property to the credit union has also been made available.

These materials were released in conjunction with the agenda for City Council’s discussion-only meeting on Tuesday, Feb. 18.

At that meeting, representatives of MSUFCU, Council members, and City planning staff are expected to discuss details of the deal, which involves the parking lot just south of Dublin Square at the northwest corner of Abbot Road and Albert Avenue. The public can also weigh in.

MSUFCU has still not submitted a formal site plan application or an application for the special use permit it will need to build to its desired height of 112 feet. The City requires highly detailed materials for these applications, so it typically takes several months for developers to prepare such applications as they must first obtain things like surveys and soil boring analyses.

The project’s success depends not only on Council approving those details, but first and foremost upon a majority of East Lansing voters giving Council authorization for the sale on the March 10 ballot. (Read more in ELi’s special voter guide.)

Above: New rendering showing the project looking north across Albert Ave, from the property on which the Graduate Hotel is now being constructed, just east of Peoples Church.

April Clobes, CEO of the credit union, confirmed for ELi earlier this week that as of now the credit union is still not requesting any Brownfield tax increment financing (TIF) to support the project with reimbursement from taxes for costs of environmental clean-up.

Environmental assessment of the property is being conducted by Triterra, a company that specializes in this work, at the expense of the credit union.

Says Clobes, “If there are significant expenses related to cleaning up the site, we will need to evaluate what are options are for the project to determine if the project is still financially viable.”

Council is also set on Tuesday to revisit its existing TIF policy, separate from the issue of the sale of lot 4 to MSUFCU.

The new renderings show an 8-story office building with a credit union branch on the first floor, in keeping with the previously-described plans. The credit union anticipates possibly renting out some of the upper-floor space to another office-user tenant for the first few years.

Above: New rendering of the project, looking northwest, with Albert Avenue to the left and The Abbot and the Graduate Hotel (now under construction) to the left. Sharp Park on Abbot Road is shown to the right.

Explains Clobes, “We have been growing 7-10% per year and have nearly doubled in asset size in five years….Our current facilities on Coolidge Road will support our growth for five to six years. This project will add capacity for growth beyond that time. If we don’t build in downtown East Lansing, in a few years we will evaluate where we locate our next facility.”

The ground-floor branch at the new building would mean the closure of the branch currently located next to Peanut Barrel at 523 East Grand River Avenue, and the new building would also involve the closure of the MSUFCU Financial Innovation and Education Center now located at 309 East Grand River Avenue.

The draft contract allows the credit union to get out of the deal if it doesn’t obtain government approvals it will seek for the project.

It also requires a closing within 60 days of voters’ approval the sale. The government approvals of the project would require more time than that unless an extraordinary rush is put on the review and approval process.

There is no provision in the contract for extension, so that would mean that if voters approve the sale on March 10, 60 days later the options would be (a) to close the sale to MSUFCU without approvals of the project in place, which could happen at the option of MSUFCU; (b) to let the contract expire; (c) to seek to amend the contract.

Asked about this, Clobes told ELi this afternoon, "We are still working through the draft document language/timelines. The draft document was released in its current state to maintain transparency. Our intent is to work through the sale process expeditiously while providing time, for our due diligence and for all government processes that are required."

She says her team will be working with the City to hammer out details of the contract in the coming days.

Want to weigh in? You can speak during the public comment period of Tuesday’s meeting, which starts at 7 p.m. in the courtroom upstairs at City Hall, and you can also write by email to City Council.

You can also read results from ELi’s survey asking voters why they’re voting “yes” and “no” on this land sale and check out ELi’s nonpartisan voter guide on the land sale question where we are answering a lot of reader questions.

 

 

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