Beal develops three-point plan to defend Thompson Block

By Dan DuChene
May. 7, 2010    ·    11:52 a.m.

Local developer Stewart Beal said he has devised a three-point plan for his defense against the city of Ypsilanti’s lawsuit concerning the Thompson Block.

Beal’s plan includes convincing the judge that popular opinion in the Ypsilanti area is on his side, communicating that he is in a good position to finalize renovating the building and filing a countersuit to force the city to allow him to start work.

Beal, managing member of Historic Equities LLC—which owns the building, said he has been collecting letters of support from area residents with plans to wheel 2,500 of them into the courtroom for Judge Donald Shelton.

Beal said he has received 300 letters from people in the community, after sending an e-mail asking for their support sent out Thursday morning.

“I had to keep loading paper in the fax machine,” Beal said. “[The letters] just kept coming in.”

The first letters Beal said he has received are from three business owners in close proximity to his 149-year-old former Civil War barracks in Depot Town. He said Linda French, who owns Sidetrack Bar and Grill; René Greff, who owns the Corner Brewery, and Tom Harrison, who owns Michigan Ladder.

French, whose restaurant is across the street from the Thompson Block, said she supports Beal because she feels Beal is a developer that generally wants to get the building in working order again.

“We need to give him more time to develop that building,” French said. “It’s a very special building to Depot Town.”

French said she and Beal had communicated via e-mail after she received his request for support. She said Beal had sent a letter to her that she could sign and send back. She said she signed it and faxed it back to him.

Aside from the business owners, Beal said he has received letters from Councilmember Bill Nickels, D-Ward 2, and former Ypsilanti mayor Cheryl Farmer.

The issue came up briefly during a City Council meeting held Thursday night. Councilmember Peter Murdock, D-Ward 3, asked City Attorney John Barr to clarify some of the statements made in the letter. He asked whether or not the city was suing Beal to have the building demolished in seven days.

“We’re asking the right-of-way obstruction be removed,” Barr said.

The Thompson Block was devastated by a fire in September, which was later deemed to be an act of arson. Since that time, wooden scaffolding has been supporting the building’s façade where the internal support was gutted from the fire.

At the time, City Manager Ed Koyzno issued a traffic control order to allow the scaffolding to obstruct traffic on the building’s adjacent streets. Traffic was later restored through Depot Town when City Council approved an extension of the order, which allowed the scaffolding to continue to sit on city-owned property.

City Council rejected a further extension of the traffic control order last month, after Beal presented a plan to have the supports removed from the right-of-way by October. The city then filed to have the building’s support structure removed from the right-of-way, citing fire and traffic code violations.

The two parties went to court last week, but the matter was postponed when Judge David Swartz approved a motion from Beal to transfer the case to Shelton. They are due back in court next week.

Even though the city is asking just for the removal of the scaffolding, Barr said if the building is then deemed to be dangerous then the city would seek its demolition.

Calling this argument “preposterous,” Beal said it is obvious that ordering the building’s scaffolding would be the same thing as ordering the building’s demolition.

Tenants for the building
To show he is in a position to complete the renovation work to the building, Beal said he now has tenants to lease out the building’s entire first floor, a portion of both the second and third floors and a portion of the basement.

One of the tenants, Elbow Room owner Andy Garris, hopes to open a three-level, 6,000-square-foot bar and restaurant in the building’s undamaged northern portion. The details of his plans have already been presented by Beal to City Council.

However, Beal said a second tenant is now on board to lease the remaining space on the building’s first floor. Unwilling to name the tenant, he did say it is a well-known restaurant owner in Ann Arbor. He said the company owns approximately 10 restaurants in Michigan, several of which are located in downtown Ann Arbor.

He said the company plans to lease the entire first floor and a portion of the basement to operate a brew pub at the location.

“They own several brew pubs,” Beal said.

Aside from a possible lease agreement, he said the company is a “historic tax credit expert” and has agreed to assist him with the banking and real-estate portion of the business as well.

“The plan is falling into place,” Beal said. “We’re pretty hopeful the lawsuit is worked out or dropped.”

He said Garris has his lease in hand and is ready to sign it if and when the legal proceedings with the city come to an end. Beal said the remaining tenant is moving a bit slower, but he said he does feel if the lawsuit is dropped the company will commit to a lease agreement.

Beal’s countersuit
The third point in Beals plan is a countersuit filed against the city Wednesday.

Called a writ of mandamus, Beal said if the motion was granted by the judge it would force the city to approve any building permits to complete work, approve the agreement between Beal and Koryzno that City Council rejected and pay attorneys fees and other costs.

“I just want to come to a reasonable agreement,” Beal said. ‘I didn’t come to here seven years ago to sue the city.”

During his initial negotiations with the city, Beal said “it was made clear” to him not to perform any work on the Thompson Block without a city-approved building permit. On March 4, he said he applied for both a building permit and a right-of-way permit, none of which were approved.

Beal said he interprets the whole situation as the city suing him to perform work they won’t let him perform.

“We’re caught in this limbo stage,” Beal said. “It’s very frustrating.”

Barr spoke on the permits at Thursday’s City Council meeting as well. He said the city cannot approve a building permit without specific dates in which the work will be completed.

Beal said he is currently waiting for a letter from the city on the final determination of his applications after a consultant contracted by the city recommended approving the building permit. He said the consultant’s findings were issued on April 26 and he is still awaiting a response from the city on his applications.

The final portion of the writ of mandamus is a request for the city to pay legal fees and other costs accrued by Historic Equities since the process began. Beal said he estimates this at $25,000, saying the situation has damaged his reputation, business interests and the residents of Ypsilanti by costing them time and money.

However, if everything were approved in Beal’s motion except the payment request, he said, “That would be so great.”

From the first portion of his three-point plan, Beal thinks there are members of City Council taking the cause of a vocal minority and acting without the entire constituency in mind. He said he thinks these few councilmembers are shaping policy for the entire city and “making sure I can’t succeed at anything.”

Beal said, “I feel that I’m being discriminated against in some way.”

Councilmember Brian Robb, D-Ward 3, was one of votes against approving an extension for the Thompson Block. He said the city is simply asking Beal to follow the law and clear the right-of-way. He also said there was no personal vendetta against Beal.

“I think it’s just a comment [Beal] is making out of frustration,” Robb said. “I think it’s very clear that the law is on our side.”

Related article:
Thomson Block fire deemed arson, suspect named