Troy, Michigan could condemn property for new transit center if Grand Sakwa rejects $500K offer

Troy, Michigan is considering condemning property occupied by its newly built transit center if a deal to buy the land can’t be reached after the state Supreme Court refused to consider an appeal by the city.

The City of Troy built a Transit Center on land, that has been ruled by a court of law, they don't own.

Troy Transit Center

The city of Troy has offered to buy the land for $550,000, one of few options left in its legal fight with developer Grand Sakwa Properties.

A state Supreme Court issued a ruling Tuesday declining to hear the case involving the city and the Farmington Hills-based Grand Sakwa, which donated the land to the city with the condition the city secure funding for the transit center by 2010.

A court ruling in May said the city failed to meet that June 2010 deadline, so ownership of the land reverted to Grand Sakwa. The city sued to retain rights to the land, which was resolved in the state Supreme Court decision.

The $6.3 million multi-modal transit center sits on the border between Troy and Birmingham in the back of a shopping center developed by Grand Sakwa.

Former Troy Mayor, Janice Daniels

On Monday, the Troy City Council voted to offer Grand Sakwa $550,000 for the property, Grigg Bluhm said. If the offer isn’t accepted, the city could vote to authorize condemnation of the property, she said.

Troy partnered with Birmingham on the transit project in 2000 when Grand Sakwa donated the land with the conditions.

The center, which figured in the recall of former Mayor Janice Daniels last year, was funded by a federal grant.

The transit center became one of the most controversial issues during Daniels' one-year stint as mayor. She led a majority on the City Council that rejected $8.4 million in federal funding for the project in late 2011; a slimmed-down version of the project won council approval in January 2012.

The 28,000-square-foot facility replaces the Amtrak station off Michigan Avenue. Birmingham, which has a free-standing bus enclosure at the Amtrak rail station, left the project in April 2011 after talks to buy land next to the CN Railway tracks failed.

State Supreme Court denies Troy transit center appeal; city to offer Grand/Sakwa $550,000 for land

Troy officials expect to present an offer today to reacquire the city's transit center site from Farmington Hills-based Grand/Sakwa Properties LLC for $550,000 after the Michigan Supreme Court turned away its latest appeal in the long-running land dispute.

The high court this week denied Troy's application for leave to appeal a May decision that the 2.7 acres of the transit center property had reverted from city ownership to Grand/Sakwa. 

Monday night, the Troy City Council authorized City Attorney Lori Grigg Bluhm to offer $550,000 after obtaining appraisals on the site — and to pursue condemnation should the developer reject that offer. Bluhm said today the city expects to present the offer today, but the company would likely need some time to review and respond to it.

ary Sakwa, co-founder and managing partner of Grand/Sakwa, did not immediately return phone calls seeking comment. Alan Greene, partner at Dykema Gossett PLLC and attorney for Grand/Sakwa, also could not be immediately reached.

At issue is an agreement for Grand/Sakwa to transfer title in 2001 on 2.7 acres near Maple Road and Coolidge Highway, where most of the transit center construction has been taking place. 

The terms of that sale called for the land to revert to Grand/Sakwa in 10 years if the city hadn't funded a transit center project by then; the city and company had conflicting definitions in court of what that term meant once the deadline came.

Bluhm said the city obtained permission from the Federal Transit Administration earlier today to add the acquisition cost to its budget for the transit center. The FTA previously authorized $1.6 million in funding toward the transit center cost.

"We're about ready to go forward (with the offer). As of just a few minutes ago, today, we've got permission to go ahead with submitting that expense, since all federal funding for the project comes on a reimbursement basis," she said.

The city hopes to get a response from Grand/Sakwa by early December, Bluhm said. Grand/Sakwa agreed to sell a portion of its 77-acre development for $1 more than a decade ago to develop the transit center, which broke ground last November. 

Troy and neighboring Birmingham had secured several funding commitments from federal and other sources for the center, with a preliminary estimated cost of about $8.5 million, which the City Council reduced in 2012 to about $6.4 million. 

Birmingham withdrew from the project in 2011. Grand/Sakwa contended that the project didn't reach full funding in time, as the consent judgment requires, and sought to revert the property. 

A three-judge appellate panel overturned the Circuit Court and ruled in Grand/Sakwa's favor last May, prompting Troy to ask the Supreme Court to review it, but the high court is not legally obligated to hear the case.

Mark Miller, director of economic and community development for Troy, and Bluhm both said the transit center construction was substantially completed earlier this year except for a minor "punch list" of modifications. But the city is still finalizing a lease agreement for the National Railroad Passenger Corp., or Amtrak, to service the transit center.