With Center City District Financing Complete, Construction to Begin

Friday, December 15, 2017, 9:48 am
By: 
Alice Dreger

With the major public infrastructure-related financing bonds closing two days ago, construction can officially begin on the Center City District project, according to East Lansing Planning Department staff. Construction permits are expected to be issued no later than today, and construction of the major new parking garage on what has been City Lot 1 will formally start.

Once completed, the project will include a 12-story building along Grand River Avenue (shown below left), with the Target store on the street-level, and another 10-story building along Albert Avenue (shown below right). The Albert Avenue structure will include new retail space on the street level, four levels of parking above that, and five levels of senior (age 55+) rental apartments above that.

The City expects to obtain about $400,000 a year in income from the project, including $200,000 in land-lease payments made by the developer for the right to build and own the Albert Avenue retail space and the senior rental apartments and about $128,000 from net new parking revenues from the new ramp.

Under the tax increment financing (TIF) plan for this project, for thirty years, 100% of taxes generated by the project that would otherwise go to the East Lansing general fund will be used to pay for the parking ramp and other public infrastructure.

At yesterday’s Downtown Development Authority (DDA) meeting, Community and Economic Development Administrator Tom Fehrenbach said that “the bonds funded and closed yesterday [Wednesday] and [Building Department staff] are in the process of approving the building permits for the foundation work.”

Noise and vibrations are to be expected as over five hundred pilings are sunk into the ground for the project. According to Fehrenbach, Christman Construction Company “will work to mitigate” these issues.

At the DDA meeting, DDA Vice Chair Douglas Jester asked if there is a clear project schedule, particularly one focused “on the impacts to downtown” in terms of road closures, parking access, and so forth. In response, Fehrenbach pointed him to the rough timeline shown on the “EL Buzz” website. Jester said it would be more helpful to have a clearer schedule of such things as when Albert Avenue will be closed and opened.

Downtown business owners continue to seek assistance from the City in terms of maintaining access to their stores and restaurants for their customers. At the DDA meeting yesterday, Fehrenbach said that the EL Buzz campaign is working to keep business owners and others informed about things like parking options. He said the website has seen over 700 unique visitors and has about a 35% return-visitor rate.

Last week, the Downtown Management Board (DMB) voted to authorize $5,000 in new expenditures to help downtown businesses during the construction. According to Fehrenbach and DMB Chair Luke Hackney, most of those funds will be spent on new signage helping potential customers see how to get to various downtown businesses.

Fehrenbach said staff is working to obtain $20,000 earmarked for public outreach from the bonds that closed yesterday. The DDA has already contributed another $20,000 to the project which has been expended on developing the EL Buzz campaign. (See memo with accounting for those funds.)

On Tuesday of this week, the Grand River Avenue location of Lou & Harry’s hosted a “business huddle” where representatives of the developer and general contractor met with local business owners to discuss questions and concerns.

Business owners said they were struggling in some cases to help long-time customers figure out where to park. Ideas of how to deal with this included better signage, changing the flow of traffic on Abbot Road, and pushing out more information to customers.

Representatives from Christman Construction at the “huddle” encouraged all business owners to call and to visit them in their temporary office above Pinball Pete’s if there was anything with which they needed help in terms of managing getting around the construction.

At Tuesday’s gathering, Jim Litwin, Director of Construction for Harbor Bay, was asked about when the Target store along Grand River is expected to open. Litwin answered, “That is still up in the air. We’ve had to move the date forward.”

Litwin said Target was “not committed to an exact date, but they are committed to the lease.”

The developers had hoped to start construction on the project in June, about six months earlier than it is starting, but ran into multiple delays related to negotiations over various parts of the complex public-private deal.

Pressed on the question of whether the parking ramp is likely to be open in 2018, Litwin said Tuesday that he did not think so, because there are complex issues of fire safety and emergency exits that will have to be settled before anyone can use the ramp. The expectation at this time appears to be that the ramp would open in early 2019.

At the huddle, Mayor Mark Meadows said the City had looked into renting the now-empty lot at the northwest corner of Abbot Road and Grand River Avenue to provide additional parking while parking downtown is disrupted by construction. A vacated old bank building was demolished at that spot in early October.

But the owners of that property, Meadows said, are not interested in dealing with the liability issues that might ensue, and they might be ready to develop the property relatively soon. At the present time, there are no active plans for that site, which forms part of the area known as “the Park District.”