What’s Going On with Big Redevelopment Downtown?
Here’s an update from ELi about various big redevelopment projects and deals (possibly) involving East Lansing’s downtown.
The MSUFCU project has started, and so a lane has closed on Abbot Road (again).
After months of additional delay, construction of the new seven-story Michigan State Federal Credit Union (MSUFCU) office building in downtown East Lansing appears to finally be underway at the northwest corner of Albert Avenue and Abbot Road.
Workers can be seen on site securing the former public parking lot, with an excavator digging up the land. Voters approved the sale of that public land to MSUFCU for this project in March 2020, but construction delays had been caused by disputes with the owner of Dublin Square next door.

Rendering from MSUFCU
Rendering showing the north side of the planned MSUFCU building, where the project meets the property of Dublin Square. (Dublin Square is shaded in, to the right.)The MSUFCU project is resulting in a closure of what is normally the southbound lane of Abbot Road, shunting southbound traffic into the lane typically used only for southbound left-turns onto Albert Avenue. That lane closure will go on for at least a year, snarling traffic in an already congestion-challenged section of downtown. That’s not thrilling some downtown business owners, even while several tell ELi they are excited about the end product.

Alice Dreger for ELi
A portion of the southbound lane of Abbot Road closed in late Sept. 2021 for construction of MSUFCU’s downtown project. Expect the lane closure to last at least a year.For its construction staging, besides the closed lane, MSUFCU is using two properties owned by East Lansing’s Downtown Development Authority (DDA), at 314 and 328 Evergreen Ave. The DDA voted 9-2 in March to demolish the buildings at those two income-producing properties to help bring MSUFCU’s project to fruition.
The demolition reduced the value of the DDA’s public assets by at least a million dollars. It also reduced the revenue substantially. Those two properties had been bringing in about $206,000 in rent per year, and MSUFCU is paying the DDA $61,000 per year to rent the now-empty land for construction.

Dylan Lees for ELi
The DDA demolished the white house at 328 Evergreen (shown here) along with the building at 314 Evergreen to lease the land to MSUFCU as a construction staging site.The MSUFCU project is expected to be completed in early 2023. Over $200,000 per year in new property taxes generated by that project will be diverted from the normal taxing authorities to support the DDA’s special projects, including the Evergreen properties-related debt.
So, what’s happening with the DDA’s Evergreen Avenue properties in terms of debt and redevelopment?
In short, the debt payments are getting bigger because the DDA is finally having to pay principal and not just interest, and prospects for redevelopment are stalled.
Information from the City indicates that, as of June 30, 2021, the DDA still owes $5,250,000 on the bonds used to purchase the Evergreen Avenue properties in 2009 as part of a failed redevelopment project. The principal left to pay is almost as much as the original principal, and in the last 11 years, data shows, the DDA has spent $1.7 million in public revenue just on interest payments. Unless paid off sooner, the bonds will run through April 2035 with the DDA ultimately paying over $3 million in public revenue just for interest.
ELi recently learned that the Evergreen properties-related bond debt is not actually tied to the land – it is not a mortgage on the land – but the DDA has long hoped to solve the debt through redevelopment of the properties.

Dylan Lees for ELi
The DDA voted to demolish 314 Evergreen Ave., an income-producing publicly-owned property, to support the MSUFCU project’s need for a construction-staging site.Right now, River Caddis Development continues to hold an exclusive redevelopment agreement with the DDA, even though that company’s representative recently acknowledged to the DDA that they have no live project proposal. In July of this year, the DDA gave River Caddis another 180-day extension anyway.
Across the street, “Building C” is supposed to rise.
At 341 Evergreen Ave., on private land at the southwest corner of Valley Court Drive and Evergreen Avenue, Chicago-based developers DRW/Convexity are obligated to construct “Building C,” a 6-story apartment building including 74 apartments for households making 80 percent or less of the area’s median income and 25 open-market units. The developers agreed to build that as part of the deal that got them the right to build The Abbot apartment building and The Graduate Hotel along Grand River Avenue.
We’ve been told that the final site plan for Building C has recently been approved. Building permit submissions are due next. For now, that spot across from the Valley Court Park tennis courts is being used as a construction staging site for sewer work in the area.

Dylan Lees for ELi
Jessy Gregg at East Lansing’s City Council meeting on Aug. 10, 2021At this week’s Council of Neighborhood Presidents meeting, Mayor Jessy Gregg described DRW/Convexity’s attitude toward having to construct Building C as “grudging at best.” She said that the developers are “definitely not enthusiastic” about that part of their project.
Meanwhile, the City has said it will be issuing a Request for Proposals (RFP) to find an external consultant to engage the community in what to do with publicly-owned spaces in and around Valley Court Park, but we have yet to see that RFP issued.
And what about Artspace?
Gregg told the Council of Neighborhood Presidents on Monday that she spent about three days “trailing after” the Artspace consultants who were recently in town to look into the possibility of building affordable live-work space for “creatives” here.
Gregg said that the developers “knocking on our doors want to make as much money as possible, so they are building giant student housing.” By contrast, she said, Artspace is a nonprofit developer “more focused on community development.”

Gregg told the Council that she objected to what she called “snide comments” on social media about Artspace, comments that suggest that East Lansing is only interested in building housing for artists, not non-artistic low-income people. She said that Artspace maintains “a very broad definition of who is part of the creative economy.” (Artspace representatives have used the example of a prospective tenant being considered a “creative” simply because they bake an excellent lasagna.)
According to Gregg, Artspace has been reaching out in the area to artists, financial institutions, and other stakeholders to see what they might build in East Lansing. She said she does not expect their “full report” for another three months, and that it could easily take five years for a project to come to fruition, which, Gregg noted, will allow “plenty of additional time” for community engagement.
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