April 3 2014 12:00 AM

In lawsuit filed today, Frandor Shopping Center owner claims redevelopment costs should be paid by developers, not surrounding property owners


Update, 3:52 p.m.: Mayor Virg Bernero issued the following response to today's lawsuit filed in Ingham County Circuit Court:

“We fully expected that certain aspects of the Red Cedar Renaissance project would be challenged, so it is not surprising that a lawsuit is being filed.  However, consistent with past practice, I cannot comment on the specifics, except to say that it significantly misrepresents the facts and makes erroneous claims and assumptions about the city’s intentions with regard to the redevelopment project.  The city will respond to the specific claims made in the lawsuit at the appropriate time and in the appropriate court of law.  In the meantime, we remain confident that the Red Cedar Renaissance will move forward and will be a tremendous catalyst for jobs, economic growth and environmental sustainability in place of an empty field.”

Thursday, April 3 — The owner of Frandor Shopping Center is suing the city of Lansing, claiming business owners in the shopping center will be on the hook for helping pay tens of millions of dollars to redevelop the former Red Cedar Golf Course he says should be paid by private developers.  

The suit cites public allegations that property owners surrounding the golf course, on which developers Joel Ferguson and Frank Kass have a $200 million planned redevelopment, will be levied a special drainage assessment to help make the site development ready.

The three-part complaint was filed today in Ingham County Circuit Court by Patrick Corr on behalf of Lansing Retail Center LLC, which owns Frandor Mall. It alleges the city is moving forward with a development plan that could potentially save the developers millions in construction costs related to building foundations and other changes to make the flood plain buildable.

Corr is seeking an injunction on the city’s allowing a special assessment to move forward.

“While we agree that the proposed development will be good for the city of Lansing, we strongly believe that all redevelopment costs should be paid for by its private developers or the city as golf course owner, not by surrounding property owners,” Corr said in a statement. “We are open to having discussions as to how we permanently fix the drainage problems of this section of the city, but we are unwilling to pay associated development costs for property we do not own. These costs should be absorbed by the developer or the city selling the land to these developers.”

The suit also alleges a conflict of interest because the city is acting “as both decision maker of the amount of each special assessment charged against the owners of existing developments, and as owner of the golf course also subject to the special assessment.”

Corr said discussions with the city are ongoing but that he filed the suit “to protect (Lansing Retail Center’s) interests.”

Officials say it could cost upwards of $50 million to make the site ready for development, which includes redesigning the Montgomery Drain and other infrastructure improvements.

A sale price of the property has not been announced.

Today’s suit is the second that has been filed in relation to the project. City Pulse first reported in February that Chris Jerome — who originally planned to partner with Ferguson — filed suit in Illinois against Kass, Ferguson and other entities involved for breach of contract, tortious interference with business expectancy and civil conspiracy. Jerome is seeking $1 million in damages.