Ypsilanti City Council rejects agreement with Thompson Block developer Stewart Beal; case likely headed to court

In a tense moment before he cast the fourth "no" vote, Council Member Pete Murdock summed up the frustrations of those who opposed the plan.

“We’re going to be in court one way or another - no,” he said.

The vote could spell the end of the Thompson Block development, should the city win the court case that now appears likely. The Thompson Block was badly damaged in a fire last September.

Last month, the council voted 4-3 to direct city attorney John Barr to pursue litigation against Beal. Since then, both sides have been working to resolve a dispute over beams propping up the Thompson Block’s façade in the right-of-way.

Barr said the building is considered a nuisance without the traffic control order that has now expired. It threatens public safety and blocks the city’s right-of-way without proper authority, he said. 

Beams are currently in the northbound lane of River Street and on the sidewalk next to Cross Street’s westbound lanes. Without the supports, Fire Chief Jon Ichesco said the walls would crumble.

The city postponed legal action last month while Koryzno and Beal worked to draft a suitable agreement. Beal said he and Koryzno met once and talked several times on the phone to work out the terms of the latest document presented to council.

Among other points, the agreement required:

• Beal furnish a $60,000 performance bond to help ensure he met the agreement’s terms.
• Beal pay for the city to hire an independent engineer to determine whether the structure is safe within 10 days.
• Beal move all support beams out of River Street within 30 days.
• Beal move shoring completely out of the city’s right-of-way by Oct. 4.
• Beal purchase $2 million in insurance protecting the City of Ypsilanti.
• Beal begin renovations with his firm or another within 120 days.

Beal said he was surprised by the council’s vote but would continue to work with Koryzno to draft a new agreement. But he said it's evident the current council will not support any agreement he presents.

“Ed spent a lot of time on that (the agreement), so I don’t think there’s a way to improve it - he did a good job with it,” said Beal, whose Historic Equities I LLC owns the building.

Beal added he’s confident a "reasonable" judge who doesn’t walk by the Thompson Block every day will allow the two sides to work out an agreement.

He also said the Historic District Commission will block the building from being demolished.

“You hear people use the word ‘demolish’ a lot, but that’s not even an option,” he said.

Beal told the council he has invested $910,000 in the Thompson Block. Part of that was his personal money, part came from his family and roughly half came from investors, he said.

The Oct. 4 deadline for removing all shoring from the city's right-of-way was two months sooner than a plan Beal presented to council in February. But Council Member Lois Richardson said it was still too long to wait, and June seemed more reasonable.

"I'm not sure of Ms. Richardson's background, but I do know from hearing her speak that she is not a construction expert," Beal said, adding a construction expert would find an October deadline reasonable.

Murdock remained mostly silent during the discussion leading up to the vote. He and Beal had a heated exchange at the March 2 meeting, after which Beal sent a letter to AnnArbor.com harshly criticizing Murdock.

Murdock said he didn’t think the two sides were making any progress, and court is now the best option.

“I’m trying to protect the public, move some things out of the street and make it safe, but whichever way it happens, it’s going to be like pulling teeth, ” he said.

Council Member Mike Bodary said he doesn't believe the building is salvageable in its present state.

“The overall cost of that is way too much - $2 million. It would take him forever to get the financing, so we’d like to see the structure taken out before the summer festival season,” he said.

When asked for a timeframe on moving the case through the courts, Barr responded he couldn't provide one. He said it would be relatively quick because the beams in the road present a danger to the public.

“I think the courts pay a lot of attention when it’s a danger to the public, so you should get a fast track on it,” he said.

Mayor Paul Schreiber said he thought the new agreement was better than the first and concentrated on safety. He added he feels litigation will only prolong the process.

“Instead of getting the building safe and secure we are going to court,” he said. “To me that’s going to delay things. I don’t think it’s in the best interest of the city, but I’m just one vote.”

Beal stressed he will continue to work to rehabilitate the building, no matter what the process.

“It’s important to note that the building is never going to be demolished,” he said.

Schreiber, Council Member Bill Nickels and Mayor Pro-Tem Trudy Swanson-Winston voted yes. Bodary, Council Member Brian Robb, Murdock and Richardson voted no.

Tom Perkins is a freelance writer for AnnArbor.com. Reach the news desk at news@annarbor.com or 734-623-2530.