City Center II site plan update likely

This project continues to be a joke! The city could make this a very unique, great development for the city. Instead they continue to bow to a developer that is in over their head when it comes to actually developing a large scale project. It is time Chappelle does the honorable thing, and stop moving forward with a continuously diminished project. The city could be doing so much more with this.

Chappelle doesn’t exactly have a lot of credibility. If he has multiple options for filling commercial space in adowntown and general area glutted with empty commercial space and a general trend away from store front shopping and people too broke to shop at high prices or go to upscale restaurants, he needs to be forced to name names.

They are also talking about a performance arts space. Who is going to perform there and how much are they going to have to charge to turn a profit?

Obviously, continuing to build new residential units in a city glutted with residential units and the university and state governments shedding jobs, is going to harm existing home owners (and drive down property values, putting stress on the city budget). There is no such thing as a niche market for residential units that won’t affect the overall glut. And the demographic this and other upscale apartments and condos is aimed for is some fantasy demographic in the cool city of Ted Staton’s spin, full young, unattached, very well paid, professionals—apparently well-to-do artists, since the future of East Lansing is in the arts, according to some consultant paid with taxpayer money that could have been spent on city services.

As to office space. The claim that there is a need for office space because of the glowing success off the Hannah Technology center and the Technology Innovation Center is spin to its extreme. There is so far no sign of technology innovation at these places, by the standards of anyone who knows anything about technology innovation, with potential for a real impact on the local economy. Look at the list of who is in the subsidized Technology Innovation Center: they are filling it with warm bodies to say it is filled. And last I heard, the Hannah Center was desperately seeking tenants. Of course, most people who are not clueless about the future think there will be much less need for office space. There is nothing in the way of software development, web design, internet content, etc., that can’t be done on an iPad at a coffee shop, so anyone renting high priced office space for those kind of “high tech” businesses is wasting money. If Strathmore is thinking medical offices that do require physical contact, that needs to be specified and analyzed (even if there were parking, driving to downtown will always be a pain in the butt).

The East Lansing Planning Commission and City Council fail in their fiduciary duty to tax payers when they do not demand the kind of prospectus, with detailed financial projections, anyone with common sense looks at before investing in anything. We can hope the bankers will demand numbers and that HUD will be smart enough not to provide loan guarantees to a company with a history of unpaid taxes and teetering near bankruptcy. But if bankers can launder the money, they won’t care, and HUD tends to bow to the desires of local officials, without asking whether these local officials could pass a beginning course in finance.

Debbie Downer has two sisters!

I would echo Eliot’s comments. Come to the council meeting tonight to hear my alternative proposal —which is essentially built on one simple theme: the city needs to let the private market do its thing and get out of the “public development” business once and for all.

Abandon the crazy idea of a theater; abandon the crazy idea of yet another unused parking ramp, and abandon the crazy idea that hordes of empty-nesters and young-millenials will be standing in line to snap up the proposed luxury condos and townhouses.

What planet do these people live on?

That would be the real world, which is clearly not where you and the other nuts dwell.

This project is great for East Lansing. It’s a shame that it’s taken so long to get it done. Phil and other wing nuts are not going to be be able to stop it because they speak only for themselves while the rest of the community wants to move our city in the right direction.

Thankfully the voters handed Phil and his lap dog Hans a sound trouncing in the last election. East Lansing has rejected your negativism Phil.

Post all the comments you want. No one is listening to you anymore.

That would be the real world, which is clearly not where you and the other nuts dwell.

This project is great for East Lansing. It’s a shame that it’s taken so long to get it done. Phil and other wing nuts are not going to be be able to stop it because they speak only for themselves while the rest of the community wants to move our city in the right direction.

Thankfully the voters handed Phil and his lap dog Hans a sound trouncing in the last election. East Lansing has rejected your negativism Phil.

Post all the comments you want. No one is listening to you anymore.

Sadly, anonymous name calling by CC II supporters, presumably someone in city government paid by our tax dollars, is what we get, instead of financial analysis that could justify this project. I want to know, out of $120,000,000 and rising, what % is devoted to residential, what to office, what to theater, what to commercial. I want to know how many units. I want to know, given Strathmore’s debt for the project (I would use junk bond interest rates), taxes, and ongoing expenses, what kind of annual return it needs to get per unit/space. How would rental costs compare with going rates in the area? Who is going to use the space (real people, not fantasies)? This is standard financial analysis stuff, but it has not been done for this project.

As to nobody listening. Obviously, the powers in city government thought city reformers would shut up after the election. East Lansing has a long history of apathy about city elections and government—people run for council on the grounds they have had kids in the school. If people running for council had to state positions and show political affiliations, results would be very different. Reform movements take time. For a city with apathetic residents, there are now a remarkably large number who are fed up. East Lansing does not have a good forum for opposition, like City Pulse, but people are listening, and when a more accessible forum than Public Response becomes available, it will be possible to post photos of the icy sidewalks the city refuses to admit are a risk and the empty houses the city refuses to admit are driving down property values, etc. It will also be possible to go over city expenditures with a fine-toothed comb. I’d be scared too.

I want to know about pension obligations, because if East Lansing is in as bad shape as a lot of other places, it will be scary.

As to “wing nuts,” that is a term used for anti-tax right wingers. Those folks complain about taxes being spent for the public good. I object to taxes being spent to subsidize profits, which I suppose is from the left, but mostly I object to spin being substituted for analysis.

Top Ten Reasons Against a TAXPAYER FUNDED BAILOUT of Strathmore:
1.FINANCIALLY INSOLVENT: Scott Chappelle, Strathmore President and RECIPIENT OF THIS TAXPAYER FUNDED BAILOUT, admitted in sworn testimony, in a lawsuit involving another failed project, that his company has been pushed quote. . . . TO THE POINT OF INSOLVENCY. . .
2.FAILURE TO BE HONEST ABOUT TAX DELINQUENCY: Scott Chappelle lied to the Planning Commission, when, after Commissioner Hill Rowley asked him DIRECTLY, Chappelle failed to admit that his property taxes on the properties were NOT PAID. Both the Downtown Development Authority and Brownfield Redevelopment Authority approved this project, based on misinformation. Furthermore, there is NO SYSTEM OF CHECKS AND BALANCES, because these to local governing authorities ARE COMPRISED OF ENTIRELY THE SAME APPOINTED citizens. Concerned citizens alerted City Council that their plans to bailout Strathmore, if carried out, would be illegal and violate the City charter, due to Chappelles tax delinquency.
3.FAILED PROJECTS: Strathmore has been drowning lawsuits, liens, unpaid property taxes, involving failed projects in Bonita Springs, Florida, Ann Arbor, and Bear Creek Township. In Ann Arbor, Governor Granholm was duped into the lies, when she believed Chappelles assertion that he had financing lined up for his project. It is an empty field.
4.PLANTE MORANs INDEPENDENT APPRAISAL: Plante Moran, the independent financial consulting firm, warned that they, the City AND the DEVELOPER had failed to conduct proper market analyses and perform the proper due diligence, raising the issue as the taxpayer risk if the developers forecasts are overly optimistic. Furthermore, they warned that the taxpayers would be in severe financial danger if the project fails. This was BEFORE THE RECESSION!
5.SMOKE AND MIRRORS: the ELPD and ELFD, according to the City Assessors SWORN AFFIDAVIT, intentionally caused smoke and fire damage to Chappelles building, rendering it functionally obsolete, and, coincidentally, qualifying it for Brownfield Financial Incentives. Nearly $100,000 of metallic material was removed, including plumbing, under the table, from the Citizens Bank building, which means that the owner of the building deliberately devalued the structure and had plumbing removed from a mortgaged and presumably insured building. You can ask Police officer Todd Quick about that one. But, of course, contrary to the SWORN AFFIDAVIT, the Police and Fire departments completely deny any involvement. Of course, if you look inside, or look at the windows, you can see the results of the incendiary smoke bomb party someone had up in there. . .
6.BANKS ARE SCARED: LOANS for overleveraged, high risk real estate projects, that worsen the oversupply of housing, given to insolvent private developers, are exactly the type of bed debt that contributed to the current recession. In this venture, the TAXPAYERS, with their $30 Million in BONDS, public debt are promising that they have Scott Chappelles back if this project fails. Letters have been submitted to the Inspector General of HUD, and the Commercial Lenders and all the major banks, and the FBI is aware too.
7.NO VIABLE TENANTS: Hotel Indigo has already jumped ship. Naya Bistro is already out of business. The TAXPAYERS are BUILDING A PARKING RAMP FOR THE DEVELOPER, with very few tenants.
8.DIVERSION OF TAX REVENUE: the Tax Increment Financing plan, HOPES to pay off the PUBLIC DEBT used to build the project, with the future property tax revenue generated from City Center II. Thus, they are DIVERTING tens of millions of dollars of tax revenue that would otherwise be going into the GENERAL REVENUE FUND, to benefit all of the people in East Lansing, schools, library, roads, parks and rec, and water and sewer infrastructure.
9.OVERRELIANCE ON PUBLIC FUNDS: More than $80 Million of the $125 Million is coming from public sources, including Local bonds, State tax credits, and Federal loan guarantees, Brownfield Incentives, and the FREE MONEY from the EXTREMELY GENEROUS MEDC, Michigan Economic Development Corporation. So, we are throwing nearly a hundred million dollars of PUBLIC money at a dishonest, financially insolvent, tax delinquent private developer, who has been drowning in lawsuits, liens, and foreclosures, involving failed projects.
10.THERE ARE CHEAPER and SAFERWAYS TO BEAUTIFY A CORNER, without wasting $80 Million Tax Dollars to BAILOUT a Developer. One step would be to select a financially stable developer, one strong enough to handle the gigantic losses, negative cash flow, and predictable vacancies that City Center II guarantees. The banks have said NO, and that is WITH the CITY HALL promising to resuscitate the troubled developer, since we are the ones who are keeping him alive on LIFE SUPPORT. If this project made any sense, from a FREE MARKET standpoint, then it would not rely almost entirely on PUBLIC FUNDING. Clearly, this only suggests that there are payouts, kickbacks, bribes, and favors involved in this no bid contract that makes no sense. The citizens have been misinformed. Their is a lack of strong investigative journalism. The few citizens who actually care enough to pay attention to what is going on, asking questions, investigating, and speaking out are labeled as wingnuts? Only by those in on the deal, I presume.

the rest of the community wants to move our city in the right direction

Really? I haven’t heard much support for the project at all. Who are these people? I know of plenty who want something to be done but don’t believe the current plan is a good one.

Regarding #5 – exactly. The City uses that building to train fire crews from around Michigan, even as far as Indiana, by setting fires in it and blowing it to pieces on the inside.

If you look on the roof you can see smoke residue from the doors.

Yeah, well the problem is that it WAS a perfectly functioning building PRIOR to the damage. Therefore, the owner, Scott Chappelle, AND the CITY worked together to render the building FUNCTIONALLY OBSOLETE and, therefore, qualify it for BROWNFIELD incentives. Thus, to the extent that nearly $100 Million tax dollars are getting sucked in to this bailout, it raises real questions, since the entire project is a sham.

Most of the tension seems to assume there are exactly two alternatives: A megastructure or an abandoned building. If you don’t want what we have, gotta go up, up, up (elevation, price, footprint.)
Or maybe not.

Some others say it’s a great opportunity for old EL to be new again, OK, why here? In the filled oxbow swamp that we call Valley Court Park … stand in the park and look around you for the high ground … this site is landfill, and stabilization is part of the high price.

Traffic flow is bad, and existing surface parking does not suffice, so these plans also create parking garages on re-routed streets.

And the “City Center” designation was a better fit in the 1950’s, when MSU and most EL businesses were a short walk from the Union Building. Look at a map, and tell me that’s still true.

If Mr. Chapelle wants to develop his own land, on his own dime, fine. But the footprint of this project goes well outside his own property and requires the willing cooperation of EL. It is not his right to demand cooperation, especially at our expense.

A declining eyesore, any other place in the city, would have received a fix-or-demolish order long ago. It is not Mr. Chappelle’s right to refuse.

And if we need this “City Center” then how about the idea of placing it where it actually fits?