DDA Hires Firm to Market Evergreen Properties, Sets Asking Price
The East Lansing Downtown Development Authority (DDA) hopes it has found the marketer to help sell its long held Evergreen Avenue properties.
At its Sept. 26 meeting, the DDA chose Savills, an internationally operating marketing firm, to help sell the Evergreen Avenue properties the DDA has owned since 2009. The properties are located downtown near Valley Court Park and Dublin Square.
The DDA will pay 5% of the sales price if the properties are sold for $2 million or more, or $100,000 if the properties are sold for less than $2 million. The DDA also voted to initially list the properties for sale for $4.435 million at the meeting.
Savills’ rate was negotiated down from its initial offer to market the property for 6% of the sales price, but with a $90,000 flat rate.
Importantly, the DDA has a list of potential partners to sell the property to, and Savills’ take will be limited to $100,000 if one of these companies is ultimately the buyer. These reserved parties had previous or current interest in the properties, according to the agreement.
The list includes some of the largest property owners in East Lansing, the city itself, Michigan State University and more. DDA member Greg Ballein is listed as one of the reserved parties, so he was recused from the vote.
In addition to the parties listed, City Manager Robert Belleman said American Community Developers (ACD) is a reserved party. Last year, City Council rejected a workforce housing project ACD proposed downtown. The DDA also voted to add MSU Research Foundation as a reserved party.
The DDA opted to set the price at $4.435 million because it is the expected bond amount in June 2025. The board made this decision to set the price without consulting Savills, which Mayor George Brookover suggested at one point.
After looking at past property sales downtown, DDA member Jeff Smith said the price was slightly below the market rate in comparison.
However, there are differences between other properties recently sold and the Evergreen properties, like others being adjacent to the city’s busiest street Grand River Avenue.
“If it gets swiped up at this price, you’re all invited to my house for cocktails the day we close it,” Brookover said. “That’s a promise.”
DDA members said the price would be negotiable and the listed price was a starting point.
The DDA is hopeful that a good use for the property comes from the market, after its previous attempts to sell were unsuccessful. Most recently, the DDA tried to offload the property through an exclusive development agreement with River Caddis.
In 2020, River Caddis proposed using the site as an eight-story office building that would also likely contain a restaurant and retail space. However, after years the proposal morphed into student housing in July of 2023, and the DDA opted to reject the proposal and not grant another extension to its exclusive development agreement with River Caddis.
While the upside of the property is clear, it is a rare large space available to develop downtown near the Michigan State University campus, there are also challenges.
River Caddis representatives said that the shape of the project, soil contamination and a lack of parking were challenges at a previous DDA meeting. The property also lies between other businesses, meaning there isn’t any leeway with space for a project.
The DDA is motivated to sell the property. Since the DDA borrowed $5.6 million to buy the property 15 years ago, it has spent a significant amount on interest payments. The debt has now needed to be refinanced twice.
DDA hopes to interview executive director candidates soon.
City Manager Robert Belleman gave an update on where the city stands in its pursuit of a new executive director for the DDA, saying he is hopeful the city will begin interviewing candidates in December or January.
Belleman said the city’s human resources department will narrow the search down before candidates are interviewed. Belleman said he would prefer to interview three candidates.
As is stipulated in an agreement the city and DDA reached in August, Belleman will select the new DDA director with input from the DDA. The director will receive the same benefits as other director-level employees.
Once an employee is hired, it will be the first time in the DDA’s roughly 30 years of existence that it has an executive director. Currently, the DDA relies on various city employees to carry out its work.