Above: Convexity Properties' artist's rendering of planned redevelopment for 100 Grand River Avenue

The Lansing State Journal reported today (8/31/16) that the new developer of East Lansing’s most blighted corner has “withdrawn plans for a new 12-story hotel and luxury apartments.” But reached today, the developer tells ELi otherwise—that plans are going forward, albeit revised to include not only the Grand River Avenue properties, but also the property of the former Evergreen Arms apartments. This is just as ELi’s Chris Root reported last week.

Christopher Oakley of Convexity Properties told ELi today that the company has been working with City Planning staff, and he acknowledges they will need to work with City Council on zoning ordinances and other possible roadblocks. But the company expects to be submitting the formal proposal on the Park District redevelopment relatively soon and is moving forward in earnest.

Reached today by phone, Mayor Mark Meadows said of the Lansing State Journal report, “It made it look like ‘there we go again, another project fleeing the city,’ but that’s not the case.” He confirmed that the developers “are still extremely interested in the project,” adding, “I’m very confident about the project.” Meadows says he is expecting the project to come to Planning Commission in the next two weeks. Yesterday the City’s Planning staff told ELi essentially the same.

At issue right now is a City zoning ordinance aimed at engineering the mix of what gets built downtown. At present, Ordinance 1384 is written to try to force a mix of housing in an effort to get more non-student housing downtown. The goal is ultimately to diversify not only housing but retail options downtown, with the thought that having more non-students living downtown will mean more restaurants, shops, and other amenities of interest to people in different demographics.

As to the redevelopment at issue here, Convexity Properties wants to construct a 12-story building along Grand River Avenue, including a hotel and residential apartments. Right now, Ordinance 1384 calls for at least 50% of the housing units in a building of this type and in this location to be “marketed, rented and/or sold as mixed market rental units…as housing offered to and restricted to residents 55 and older or as condominiums.” In other words, at least half the housing units in this new building would have to be for seniors and/or be condos.

A change proposed by Mayor Mark Meadows at the last City Council meeting called for amending this requirement to having “at least 25% of the housing [be] owner occupied or restricted to residents 55 and older.” So if approved, this change would cut in half—to 25%--the number of housing units that would have to be for seniors or be condos.

Still, the developers are not convinced this revised rule is workable. Chris Oakley explained to ELi today that “this is due to the lack of financing for condominium development and difficulties associated with mixing for-sale and rental product within the same building, among other considerations.”

Meadows noted to me today that the proposed changes for Ordinance 1384 would also include changing the boundaries of the zoning rule to incorporate all of the Park District, including the site of the former Evergreen Arms. Right now the requirements only apply to the Park District properties east of the alley behind Dublin Square. Meadows says that if Convexity submits plans for many properties in the Park District area, and not just the main building along Grand River Avenue, with the ordinance’s boundaries changed, the 25% rule would apply to the whole project. If senior housing is constructed along Evergreen Avenue, Meadows says, that might then mean the project meets the 25% requirement of the revised ordinance.

Nevertheless, at the most recent East Lansing Downtown Development Authority (DDA) meeting, some members of the DDA said these kinds of restrictions—even the lighter one proposed for a revised Ordinance 1384—are untenable financially, given market realities. Today’s LSJ report documents how challenging it has been to diversify housing in the downtown area, largely because there’s been relatively low buyer interest in condos in the downtown area.

How this plays out remains to be seen. Meadows notes the proposed changes to Ordinance 1384 have already been referred to the Planning Commission, which will now hold a public hearing on it, discuss it, and make recommendations to City Council. Council will then hold a public hearing on it and decide what if any amendments to make to the existing language.

Of the ordinance, Meadows told me, “We need to change the mix [of downtown development] and this is the attempt to do it.” He does not seem to think residents need to choose between diversification of downtown’s population and an end to what is widely viewed as the worst blight in the City.

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Note: After publication, this article was corrected: Mayor Mark Meadows said he expects the formal proposal to come to the city in the next two weeks, not the next two months.