By TEREASA NIMS
Sunday Times Newspapers
ALLEN PARK — City administrators are tight-lipped about the sale of Southfield Lease Properties and it even has other city officials asking, “What is going on?”
New York City-based Time Equities Inc. put $250,000 in escrow on June 11, for the property and were given 45 days to do evaluations on the 104-acre land. It had the right to opt out of the deal after evaluations were complete under its due process rights.
Those 45 days ended on July 26.
The Sunday Times Newspapers learned that each side has up to an additional 15 days to resolve any outstanding issues and one of the sides asked for the additional time. It’s unknown which side, but that additional 15 days expired on Monday.
“The last I heard the property was very close to being closed on,” City Councilman Harry Sisko said Thursday.
Emergency Manager Joyce Parker did not respond to repeated attempts to contact her for this story.
On June 12, Parker and City Council members were all smiles when announcing the possible sale. The city was in line to collect $10 million for the former Unity Studios property, $2 more than what the property was valued.
A TEI representative said the property is not listed as a property and had no other comment on the matter.
Residents attending the press conference were skeptical about the deal.
Others, such as residents Sue Ford and Chris Cook, saw the sale as a chance for the city’s revival, even though they were disappointed the city was selling the property for less than half of what it paid for it.
At the June press conference, Parker said should TEI back out, there were potential buyers in Canada and California interested in the property. Their dollar amount offers weren’t released.
The city purchased Unity Studios/Southfield Lease Properties in 2009 for $25.5 million in hopes of luring film makers and media production companies, but the endeavor failed. Unity Studios moved into the facility and vacated after one year, thus leaving the city holding the multi-million dollar debt.
TEI acquires, develops and manages commercial and residential properties throughout the United States, Canada and Germany. Company representatives said they wanted to buy the property at 16630 Southfield Road for retail, office and industrial uses.
TEI, a 50-year-old company, owns three other properties in Michigan. The company also has ties to Germany and Canada leaving some city officials speculating it will draw global business to Michigan.
Should TEI buy the property, the company will pay $3.6 million at closing and $8.4 million over the next 7.5 years. TEI’s initial plans, if it bought the property, was to invest an additional $6 million to $8 million into the property.
Cook said she wants to see the building sell, because it would be nice to put the failed movie studio complex behind and look to the future. It also would allow the city to get out from underneath some stiff expenses.
During the June 12 press conference, Parker said the future debt service based on refinancing is $1.2 million in comparison to the current annual amount of $2.6 million paid from the general operating and Southfield Lease fund. She noted the city would save an additional $1.2 million by not having to pay the taxes, insurance, maintenance and utilities on the property.
Parker said then, that in addition, by the city no longer burdened by the debt payments related to the property the sale allows the municipality to continue to move the city toward financial stability and the eventual return to local control.
“They shouldn’t have done it in the first place,” resident Maurice Smith said Thursday. “We’ve been paying for it ever since. The previous mayor and council got us into that and there wasn’t even a vote.”
(Tereasa Nims can be reached at [email protected])