PPNA Happenings

Happenings, history and news of the Prospect Park Neighborhood and Ypsilanti

Thompson Block Restoration?

Posted by ppna on February 5, 2008

I want to point out before you get to reading this that I don’t know Stewart Beal and I hope he is able to make this project work. I will say that I have a dirty feeling (justly or unjustly) about the way Beal came to own the property, something about it doesn’t sit right with me. I know it was settled in an appeals court but from reading the appeal document I think Kircher had good points but I’m not a judge.  From what I gathered of the appeal document was that the appeals court might have sided with Kircher had he argued his case properly — In many instances they point out that Kircher gave them no information on which they could rule.   The appeals court also found Circuit Court Judge Donald Shelton was the cause of a lot of  the problems because he didn’t follow initial orders which probably would have made a difference to Kircher.

I will also say I know of Kircher and grew up around his poorly maintained properties.  I have had family and friends that have lived in Kircher dumps and I don’t think he is good for the city.  I do think property rights are a sacred thing in the US and they should be protected so when things seem odd it doesn’t sit right.

I am also very pessimistic about the prospects of the Thompson block and have been disappointed that the building looks worse everyday.

Now for my rant.

Who knows what is going on with the Thompson Block? I was trying to track down some updates and came across this article that says residents will start moving in come May of 2008. Perhaps the residents will move into the trailer Beal has had parked outside for the past year.

Here are some other lines from the article.

The court named Barnes the building’s receiver, until Beal purchased the rights for $187,686, the amount Barnes had foreclosed on the building, plus an unknown additional amount.

I never understood any of this receiver business or how rights to it could be sold and how the city chose the private parties to ‘do the work’ in the first place. It seems fishy that Barnes and Beal had their own deal worked out and Beal was the only bidder at the Sheriff auction for the property. Perhaps there should have been some fanfare put behind the auction of one of the most historically relevant buildings in the city.

After Kircher did not pay the cost in repairs Barnes and Beal had made to the Thompson Building, which totaled $400,000, Beal assumed ownership in November.  

Anyone who has been in the building would be hard pressed to see $400,000 worth of work and only a small amount of work being done. From the outside you can certainly tell that the building has deteriorated under Beals ‘ownership.’

I think I understand correctly that part of that $400,000 was for legal fees Kircher was ordered to pay so perhaps there wasn’t $400,000 worth of work.

The following paragraph was taken from Kircher’s appeal:
At some point, it became apparent that Kircher had not complied with the May 22, 1996
order. A second agreed order was therefore entered by Washtenaw Circuit Judge Donald
Shelton on July 14, 1997, directing Kircher to submit bids for the work listed in the prior agreed
order, to submit applications for grants or other funding, and to “begin work on the building to
complete the repairs and improvements listed in the May 22, 1996 order within 120 days.”

I don’t know how the Thompson Building could pass any codes as it stands now. Has there been a recent code check done on the building? I know the city has a different relationship with Beal than it does with Kircher but I have the same relationship with the building I’ve had all along (although it had businesses and people in it until the city got involved and it had more windows before Beal got involved). In my judgment hanging banners (Historic District Commission is this allowed?) doesn’t count as restoration. I certainly hope there is some sort of time line to force Beal to work on the building. Without any timeline perhaps the Thompson Block will sit vacant like the Depot. How much time does Beal get until he is ordered by the fire-marshal to make repairs?


From another article from last September.

Beal said in August that he had about 60% of the first floor with signed leases and needed one more tenant before he can proceed with bank financing.

This worries me more — It seems like bank financing is a tough thing to get especially for a mix-development in a city where a building couldn’t be auctioned . I guess that is an issue between Mr. Beal and the bank but if we are to sit and wait until he gets financing it could be a long wait. Perhaps, we will learn in a comment that the financing is secure and renovation will start next week.

Here is the kicker though,
Beal applied for a tax freeze on the building, under the Obsolete Property Rehabilitation Act, after acquiring the building. The freeze holds his tax payments at $10,000 a year for 12 years, saving $2 million and making the project profitable.

Here I am going to assume Beal was granted the tax freeze although I don’t know.

Beal isn’t forced to do anything because he is only subject to $10,000 a year in taxes (just under double what I pay on my meager home). The good news is that the city can revoke the OPRA if the developer hasn’t finished the project in a specified time. I have to question the idea of giving a tax break for 12 years in a city where we constantly discuss the lack of growth potential (due to size) and the number of non-tax paying structures we have in the city. Part of the OPRA discusses the need to decide if the tax break is needed for a developer to commit. It may have been needed for this developer but the Thompson Block is as prime a piece of real-estate as we have in the city why not let it produce for the city.

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4 Responses to “Thompson Block Restoration?”

  1. Ypsidixit said

    Very informative articla; thank you.

    There’s’ been a small new development on the situation; I posted it here.

  2. A Friend said

    Wow, you people are real quick to judge someone you dont know! Beal Inc./Beal Properties has been not allowed to do any work to the properties. And I can tell you for a fact that people have been beating the door down to get into this property. What the hell difference does it make to you how long it takes Beal to finish the property? Perhaps you should forward your questions to the city and the fool that owned the building before Beal did!

    Why don’t you look at the other nasty properties around town that he has made habitable and profitable.

    Maybe you should think about it, before you start bashing people…and by the way that dirt bag Kircher was in fricking jail when this went down! Maybe you should take that into consideration!

  3. ppna said

    Dearest, A Friend,

    I in no way have bashed Beal. I stated what I understand from what I have read and what the appearances are. I have not issued signs or press releases promising tenants or times to completion. As always, I am very ready and accepting to change things if I am proven wrong.
    I admire Beal Inc. for its efforts to restore the Thompson block and I certainly hope they are successful. You are correct I don’t know what is going on with the building and I don’t know Beal or Beal Inc (as I stated). What I hear is that Beal needs a certain number of tenants before he can secure financing. I also know that last year when people were allowed into the building during the Heritage festival it was full of water. I also know that there are a lot less windows in the building and as of right now it isn’t even secure (there is a broken door out front), there is a trashed US Flag hanging from the building and a sidewalk full of glass.
    Why do I care how long it takes for the building to get finished? Because I’m a resident of the neighborhood and that building is a corner stone. I also care because this city needs buildings to start producing tax revenue even though the city gives OPRA breaks to just about everyone. I also care because other potential investors are probably looking at this project for the feasibility of projects they may wish to develop.
    I think the 6 months since the post and your comment have proven my point which was that we will be waiting a long time for this project to come to completion.
    I would like to learn more about your statement that the Beal Inc. has not been allowed to do any work on the properties. Don’t worry, The city is well aware of my concerns.
    I did take the fact that Kircher was in jail when this all went down and that makes it seem even more dirty.

    I hope you realize that we are both on the same side of the Thompson block issue. I can’t wait to spend my money in nice retail spaces and thank Beal for creating a terrific building out of an eye sore. I would also like to offer my help anyway I can. If it is true that the city won’t allow Beal to work on the property I’m certain I can get a lot of people to city council meetings to change that thinking.

    Thank you for your comment, sorry to have pissed you off.

    Kurt

  4. Schutzman said

    “I would like to learn more about your statement that the Beal Inc. has not been allowed to do any work on the properties.”

    yes, ditto.

    also,

    I have yet to understand why the city adopted this tact, why they didn’t just buy the building outright (keeping in mind that Ypsilanti was doing this quite a bit a couple years ago), how this whole process of receivership works, why Barnes and Barnes was chosen, why they were allowed to then back out of the deal, why Beal was chosen, and why in this time he hasn’t been able to secure the building, let alone restore it.

    I’ve heard bad things about David Kircher. I’ve also heard good things about him. He might be bad, he might be good, but that debate is irrelevant to what’s being discussed, and I’ve heard his name thrown out inappropriately one too many times as a straw-man argument with the Thompson Block. Ditto on the whole liquor license process, and ditto on the Despot Town rivalry that’s theoretically blocking development.

    As for Beal’s other properties, I’ve looked at them, the rent is well beyond what my wife and I could afford, and thus ends my non-Thompson-block-related interest in his work.

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