Developer Stewart Beal files countersuit against the City of Ypsilanti
The Thompson Block is now at the center of a lawsuit and countersuit.
Ypsilanti developer Stewart Beal has filed a countersuit against the City of Ypsilanti in the latest development over the fate of the Thompson Block building.
In the lawsuit filed in Washtenaw County Circuit Court Thursday afternoon, Beal’s attorney, Nora Lee Wright, alleges the city ordered Beal to remove the shoring stabilizing the structure’s façade from the roadway - but refuses to issue a building permit and right-of-way permit necessary to do the work.
The complaint charges that in doing so, the city is, in effect, ordering the building's demolishment.
The dispute over the building, and the shoring supporting it, began not long after the Thompson Block was gutted in a fire last fall. The fire was deemed arson, and police are still searching for a suspect charged in the crime.
The complaint asks the court to order the city to issue both permits and to approve an agreement reached between Beal and City Manager Ed Koryzno “which provides a reasonable time line” for removing shoring propping the building’s exterior.
The shoring is currently in River and Cross streets, but Beal said he is unable to do anything to remove the beams without the building permits. "The city is actually obstructing our progress on the project,” he said.
“At the very first meeting we ever had with the city, they made it very clear we were not to move anything out of the right-of-way without a building permit, so at this point, what are we doing?” he said.
Beal filed for building and right-of-way permits on March 4. A letter he provided to AnnArbor.com dated April 26 shows a code enforcement official recommended approval for the building permit to Kurt Weiland, the city’s building official.
Beal asserted his company has done everything required to obtain the permit, but the application was rejected without explanation. Beal is currently appealing the decision with the Washtenaw Construction Code Board of Appeals.
The right-of-way permit application was denied by Koryzno on March 22 because - among other reasons - a traffic control order allowing support beams to be in the road had expired.
The letter also stated no significant work has occurred on the property since the fire. Earlier in the complaint, Beal’s attorneys said he was not cleared to start working until December, at which point weather prevented any significant progress.
The city sued Beal, whose Historic Equities Fund 1 LLC, owns the structure, on April 7, to force the removal of all shoring from the roadway. The city alleges the Thompson Block building and shoring are a nuisance and hazard on several counts.
The filing came a day after the council voted 4-3 to reject the Beal-Koryzno agreement. In the agreement, a six-month timeline was provided to begin renovations on the building. It also called for Beal to have the shoring out of the street within 30 days.
“Some on the city council said filing this lawsuit will speed up the process … it has been shown to do the opposite of that,” Beal said.
City attorney John Barr said no agreement could be reached on the plan's details, such as an acceptable timetable or performance bond, so no building permit has been issued. He added that during that time, the traffic control order allowing the shoring to be in the street had expired.
Barr said the city council has an obligation to keep the roadway clear.
“Mr. Beal is in the public right of way,” Barr said. “He wants to use a public street for his personal purposes, which may be good purposes, but he’s still using a public street. We have an obligation as the city to make the streets available for public, not just someone doing business.”
Council Member Brian Robb, who voted against the agreement, said he asked at the April 6 council meeting what the completed renovations would look like. He was told that per the agreement submitted to council, the building would still have no roof or significant progress to the interior.
"In that plan, at the end of the year, the building wouldn't have a roof," Robb said. "If he thinks that is a plan, then we have disagreement on what a plan is."
In the countersuit, Beal alleges the city council abused its discretion in not approving the agreement.
Barr said the City Council and city manager may not always agree.
"The city council are elected to represent the interests of the people of Ypsilanti," he said. "They're in a situation where the merchants were up in arms, they had received complaints and phone calls ... council feels that this has gone on too long and they want to protect the rights of the public and keep the street open."
The complaint alleges the vote and denial of the permits is interfering with Beal's ability to obtain financing and find tenants to occupy the space, resulting in economic damages.
Beal said a lease has been presented to Andy Garris, the owner the Elbow Room in downtown Ypsilanti, who he says is interested in building a three-story, 6,000-square-foot bar and restaurant. Garris could not be reached for comment Thursday night.
Beal also said a “well-known restaurant group” based in Ann Arbor has shown interest in 10,000 square feet for a brewery and restaurant. He declined to name the group, but said it has been sent a letter of intent.
“They bring a certain amount of financial backing that will help us attract the money we need to do the project,” Beal said.
Floor plans provided to AnnArbor.com showed the remaining space would be converted into 12 luxury lofts.
Beal said he is confident the group would enter into a partnership once construction on the Thompson Block is cleared to resume.
“Certainly no legally binding contracts will be signed until the lawsuit is resolved,” he said.
Beyond the charges in the complaint, Beal said he believes the vast majority of residents want to see the building saved. He's started a drive seeking 2,500 letters of support from the community to present to the judge.
“It’s our position that there are maybe 20 people in the city who want the building demolished,” he said. “The vast majority of people who enjoy Depot Town and enjoy the city of Ypsilanti want the building saved, no matter what the cost, no matter what the timeline - a do whatever it takes type of situation.”
Robb said he has heard more support for clearing the roadway immediately.
"The overwhelming communication I receive from consituetnets says that this a hazard and they want the streets cleared," he said. "And in order to have the streets cleared, we need a plan."
Ypsilanti Mayor Paul Schreiber, who voted to accept the Beal-Koryzno agreement, said he would like to see work start as soon as possible and has concerns over the structure's safety.
“Right now we’re at court instead of the construction site ... ‘court’ and ‘fast’ usually aren’t used in the same sentence,” he said.
Beal said he's saddened to sue the city he lives in, but charges the city has “forced his hand on the issue.” He said he believes some council members would vote against any project he brought before them.
“Normally the city takes action against unwilling participants ...,” Beal said. “It’s kind of unprecedented to take action against an owner who will do whatever they say - you just have to be reasonable.”
Beal said his attorneys will make a motion to combine the two lawsuits before the next hearing on May 12.
Tom Perkins is a freelance writer for AnnArbor.com. Reach the news desk at news@annarbor.com or 734-623-2530.
Comments
laurie in ypsi
Mon, May 17, 2010 : 12:42 p.m.
I drive into Depot town several times a week and weekends and have not witnessed one traffic issue or felt anything more than mild irritation at the absence of turn lanes. I would have to say the businesses with the most to lose are the ones whose views are of this sorry building. I know I dont like to sit at ST and look at it. And for coming down, falling down...the train rumbles by that thing often enough to have tumble tested it by now. Unless someone helps it along...I dont think its going to spontaneously crumble. I would love to see the facade preserved but if it cant hold itself up then I am afraid it might be curtains. But this is a surreal glimpse into the inner workings of our local government. No wonder we're a mess!
Ubish
Sun, May 9, 2010 : 11:19 p.m.
I live in the depot town area and drive by this building every day. I understand that it is an eye sore and that people want it torn down, but what happens when they do that? You'll have an empty lot surrounded by concrete and weeds that is just as much of an eyesore as the building in it's current state. It's not like they'll turn it into a park or community garden. I'd rather have half a building with potential than another empty lot. Also, those of you complaining about traffic hindering the local businesses are crazy. There are 2 lanes in every direction, all they did was get rid of some left turn lanes. Since they reopened two way traffic i've never seen what i would consider a traffic jam that would keep people away. If he is telling the truth about the reastaurants that want to lease the ground floor then I don't see how we can just tear the thing down. I realize he has made some promises that he couldn't deliver on and that people are mad about that. Unfortunately I don't see a better alternative at the moment.
Soothslayer
Sat, May 8, 2010 : 1:55 p.m.
@Gary Little "Why must people with only negative and insulting remarks hide behind fake names?" >>> Sure if you're planning on being all rainbows and kittens all the time you may not feel the need to protect your identity but as you can see most here are unhappy with the debacle this situation has become and fear retribution or unwanted attention.
voiceofreason
Fri, May 7, 2010 : 9:25 p.m.
After reading some of the comments here, I now have a deeper understanding as to why there is no private development going on in Ypsi.
Porksword
Fri, May 7, 2010 : 4:21 p.m.
Since when is Stewie Beal considered to have deep pockets and a historical redevelopment expert? His daddy has deep pockets and provided him with the means to create a company. To my knowledge Stewie has never redeveloped anything. Just another loud mouth with a strong sense of entitlement because of who his daddy is.
Carl Duncan
Fri, May 7, 2010 : 1:53 p.m.
What is the hurry? It doesn't look like that lot would be big enough to put a Burger King in.
Cash
Fri, May 7, 2010 : 1:39 p.m.
Mr Lillie, All business people have to follow those minor technicalities...also known as code, regulations and laws of the land. I know many local business people who run into those "technicalities" all of the time. Those technicalities make running their business more difficult. But they follow the regulations/codes and do it the right way. That building has been an eyesore for years. He had lots of time to get past a technicality. There is no building anymore. It is a crumbling shell. Time to go.
Gary Lillie
Fri, May 7, 2010 : 1:10 p.m.
Why must people with only negative and insulting remarks hide behind fake names?
Gary Lillie
Fri, May 7, 2010 : 1:06 p.m.
@ Cash, et al. Stewart Beal is being accused of doing nothing but talk. Are you familiar with how he was ready to start construction years ago but was held up by bureaucrats over a minor technicality in a procedure? I am speaking out of memory and it has been years, but the problem was with either the state or the Federal government. It had to do with him doing some cleanup demolition to the site just prior to his application for historical status being approved. The status has much to do with the ability to receive financing for rehabilitation of a historic structure. This is a prime example of how America has deteriorated from the days when it had a get-good-things-done attitude to the mentality of "I have power over you."
Mary Catherine Smith
Fri, May 7, 2010 : 12:29 p.m.
Beal is neither deep-pocketed nor a historical restoration expert. If he were, the Thompson Block have been restored long ago. And if he really cared about the building, as he claims, it would have been insured and secure. It was wide open for anyone to enter from the time it came into his possession. Enough is enough...tear the pile of bricks down.
Tom Perkins
Fri, May 7, 2010 : 12:19 p.m.
Additional comments from City Attorney John Barr and Council Member Brian Robb have been added to the story.
krc
Fri, May 7, 2010 : 11:36 a.m.
I've only seen this eyesore in pictures. I can't imagine living near it or trying to negotiate the traffic. My question is, Are the walls going to come down in order for the building to go up, when and if it does? Are the bricks even salvagable? If they are, why doesn't Beal hire a crew to dismantle the walls brick by brick and store them in another location? If they aren't salvagable, then knock them down and level the lot!
ypsipolitics
Fri, May 7, 2010 : 11:31 a.m.
For those concerned with the safety of River Street you have Bodary, Richardson, Robb, and Murdock to blame. In the agreement presented to council on April 6th it included a provision to have everything removed out of River Street by April 21st. In the meeting these council members said that filing a lawsuit would cause things to happen more quickly. Did it?
DepotMom
Fri, May 7, 2010 : 11:12 a.m.
If Beal had shown any real progress rehabing the building before the fire or intent to rehab the building after the fire then I might have some sympathy for him and this countersuit against the City. The fact of the matter is from time to time over the years he parked a Beal truck outside the building and left a gigantic tinderbox sitting on the corner of an otherwise great (albeit up-and-coming) neighborhood. As someone who lives on the same block as this disaster I find it insulting that he has had the nerve to put my house and my neighbors' homes at risk of also going up in flames (we had smoking ash on our roof during the fire). Since the fire we have lived with this dangerous crosswalk/shoring situation. Crossing the street here is perilous. Just driving here is dangerous now because the street is too narrow. It would shock me if a builder could get away with this in downtown Ann Arbor or anywhere else. Pete Murdock, Paul Schriber and the other local leaders need to stand up to Beal, take action and demolish the property. What's it going to take? Beal has had plenty of time since before the fire to rehab the building. And now after the fire to show his intentions of fixing or demolishing the building. Beal is a pro at excuses and stall tactics. Why should the residents suffer? I suspect whomever posted about maybe 20 people wanting the structure demolished and the other posts praising Beal do NOT live in the neighborhood. Until you, your family and your home are affected daily from this dangerous blight, please rethink your POV.
dading dont delete me bro
Fri, May 7, 2010 : 11 a.m.
"...alleges the city ordered Beal to remove the shoring stabilizing the structures faade from the roadway - but refuses to issue a building permit and right-of-way permit necessary to do the work." beauracracy at it's best. why did the city council vote down a compromise that was acceptable to koryzno, schreiber, and beal? let's see...city budget is TIGHT, let's run this through the court $y$tem. while there's another story posted on the 'front page' that budget cuts will involve ypd and yfd personnel. what a brilliant city council. (oh, alledgedly)
Ypsidweller
Fri, May 7, 2010 : 11 a.m.
New "edited" comment: The only thing holding the bulging/leaning mass together are some cables. And they don't look very good either. I tried to cross River St. yesterday with my infant son in a stroller. We were in the covered saffolding passage trying to head west on cross. Cars on Cross St. turning onto Northbound River St. could not see us. I had to duck back in several times when the light turned green to avoid the danger. After four or five cycles we made it through. I also hoped the plywood above our heads would hold bricks if it were to go. Cracks are getting longer and larger. I agree, anyone that thinks its restorable needs to actually go up to it and look.
SMAIVE
Fri, May 7, 2010 : 10:36 a.m.
CountyKate I believe you said it quite nicely. Follow the money...there are Federal and State preservation tax credits, specific use redevelopment funds, pre-existing loan or mortgage requirements, INVESTORS who don't want to lose any money. Further it's possible pre-existing conditions or code exemptions would apply if the old is "preserved".
Cash
Fri, May 7, 2010 : 10:26 a.m.
Anyone supporting the continued existence of this hideous crumbling shell needs to 1. Get out of your car and walk up and look at it and 2. move into the East Cross Depot Town area and live next to it. The arson itself is a demonstration of the value of this property even before the fire. Vagrants sat in it at night and drank. How would you like that next door to your home or business? And it sat that way for years under Mr Beal's ownership. It was insecure and unsafe. And now that it is a crumbling shell it is even more dangerous. I don't care if this unkempt property was owned by Donald Trump, it was a dump and a disgrace to East Cross/Depot Town and now even worse is a danger to the community. No other city would have been as patient. Please for the sake of the residents and the businesses of Ypsilanti, take it down!
CountyKate
Fri, May 7, 2010 : 10:06 a.m.
We would have been happy to have had Beal build, Do not taunt Happy Fun Ball, but he didn't. There was no building being done for over a year before the fire. Now, all of a sudden, Beal wants to do something. Too late. And, voiceofreason, don't be so sure Beal has such deep pockets. His reason before the fire for not working on the building was that he was waiting for funds, and it's the same story now. We're not discouraging a "deep-pocketed historical redevelopment expert" as much as we're discouraging someone who buys up property and then doesn't fix it up. There's a difference. A2grateful, we aren't kicking a business person when he's down - we're trying to save numerous other business people whose businesses are suffering because of the traffic-halting eyesore that is all that's left of the Thompson Block. The needs of the many outweight the needs of the one. As I've said before, I fully supported Beal when he took over the Thompson Block. But, his empty promises and lack of progress eroded away my trust and that of many others. And that was before the fire. Now, I'm asking why Beal is so adamant about saving this crumbling mass of bricks, instead of leveling it and putting up maybe the same floor plan as he says he has now, but in a new building. What motivates him to keep what is clearly beyond redemption? As all the mystery writers say, "Follow the money."
Ypsi
Fri, May 7, 2010 : 9:59 a.m.
By all means - let him build! Tear down this building that is beyond repairs and build a new building for his tenants. Why is that so difficult? He is obviously gaining more financially by having this shell remain standing than building something new that can benefit the community.
SMAIVE
Fri, May 7, 2010 : 9:55 a.m.
Good stall tactic, got to give him creit for working the system. I would say he has become "one of the many seasoned developers in Washtenaw County."
Do not taunt Happy Fun Ball
Fri, May 7, 2010 : 8:44 a.m.
How can anyone blame Beal for this - it is all his money - his time - and so far his loses - The City of Ypsilanti is just dragging their feet with moronic zoning and code etc. Let him rebuild the Civil War Barracks and Ypsi will be better. Knock it down and build what? ANother vacant strip center? Developers across Washtenaw should BAND TOGETHER to Unionize and sue each and every building department every time they put forth development plan. Cities don't know development. New development attracts jobs, and - - other new development, and other new investment. LET BEAL BUILD!
YPboyWRheart
Fri, May 7, 2010 : 7:35 a.m.
Thanks Mr. Beal for another summer looking at that nasty building. Tear it down.
An
Fri, May 7, 2010 : 7:30 a.m.
I drove past this building Tuesday afternoon. I like the idea of trying to save the facade, but what I saw of this building was a very unstable situation that looked like it could cave at any minute. That building has been empty for as long as I have lived in this area (18 years next month) and nothing had been done until it caught fire. Historical buildings are awesome, but this one looks scary.
watchingypsi
Fri, May 7, 2010 : 7:19 a.m.
Voiceofreason you have Stewart Beal confused with his grandfather and father, they were and are the experts, not S.Beal. And, when you wrote that he is the "only" redevelopment expert in the area, I almost spit my coffee out. There many very talented seasoned developers in Washtenaw County. I have a feeling the city of Ypsilanti knows what it is doing when it comes to believing what S.Beal promises. The city deals with landlords and builders all the time, and maybe, just maybe, in Ypsilanti's city hall there are piles of fines, warnings, violation letters, complaints from tenants and overdue tax bills that we readers know nothing about. Maybe the city has good cause. But not one reporter here at Annarbor.com has researched that sort of thing. But from all the negative reader comments on ALL the articles there have been written about Beal here on Annarbor.com, I would say that an overwhelming number of citizens, tenants and employees see S. Beal as untrustworthy, and not a man of deep knowledge who always keeps his word like his grandfather was and did.
tdw
Fri, May 7, 2010 : 6:34 a.m.
@a2grateful You are right but so far its just a dream
Jimmy McNulty
Fri, May 7, 2010 : 6:09 a.m.
"The complaint requests that the city issue a right-of-way permit and building permit, which Beal says are required to move the shoring propping up the buildings faade out of the citys right-of-way." Beal begrudgingly moved his shoring once, finally opening up Cross Street again to 2-way traffic. I seriously doubt anything this guy promises. I love historic buildings, but this one's beyond repair and is a public nuisance that should be torn down. I might have a different opinion if the building were farther from, and not interfering with, a main intersection and other places of business. Does the building even have insurance on it in its present, dilapidated, dangerous state??
Stupid Hick
Thu, May 6, 2010 : 10 p.m.
"The saddest element of this saga is those that kick a business person when they are down" I disagree. It's not sad, it's funny considering how Beal acquired the Thompson Block to begin with. Shoe, please allow me to introduce you to Other Foot.
Mick52
Thu, May 6, 2010 : 9:50 p.m.
I'm with a2grateful and voiceofreason on this one. These days anyone willing to develop should be given more patience. Everyone should know that development has been stalled nationwide. What do you suppose will happen if Mr. Beal pulls out of this? Do you think anything will happen under someone else? Perhaps I am incorrect, is there a long line of developers eager to build in Ypsilanti?
Lisa Hildebrandt
Thu, May 6, 2010 : 9:10 p.m.
Seriously, Cash is right. Beal has done nothing but talk for years as we in the neighborhood look at a crumbling eyesore. Someone should inform Beal that putting up a banner claiming that lofts are coming in september, 2009, does not constitute working on the building. His claim that, due to the city's lawsuit, he would now have to halt working on the building is laughable. There has been no activity there since they propped it up.
a2grateful
Thu, May 6, 2010 : 8:07 p.m.
Thank you Mr. Beal for your belief and investment in Ypsilanti. I have admired the Thompson Block Building for many years, dreaming of what it could be. I hope that you will be able to save what is left, although odds seem to be increasingly against you at this time. The saddest element of this saga is those that kick a business person when they are down. Did anyone notice that an arsonist was possibly identified and arrested? There is so much dysfunction in the world right now. No surprise to see a nice slice of it right here in this little blog.
Cash
Thu, May 6, 2010 : 7:38 p.m.
That dump has stood there for years now and there was nothing coming from Beal but empty unfulfilled promises. The City did what it needed to do for the residents of the area and the businesses of the area. This is not a building, it is burnt shell ready to crumble. Go take a look at it up close if you dare stand up close. The City showed patience in the beginning but this neighborhood has had enough of the ugly ruins hanging over Depot Town and the traffic mess on the corner. Thank you Ypsilanti standing up for the businesses and residents of the area.
Mikey2u
Thu, May 6, 2010 : 6:49 p.m.
How about we just eliminate the middle-man and shore up the buildings exterior with attorneys.
voiceofreason
Thu, May 6, 2010 : 6:44 p.m.
Congrats, City of Ypsilanti! You have now ensured that the only deep-pocketed historical redevelopment expert in the area will no longer invest another penny in your municipality.