About the Phoenix Center and Background Facts

About the Ottawa Towers

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Built in 1982, the Ottawa Towers are two eight-story commercial buildings in the heart of downtown Pontiac in Oakland County, Michigan.  The two buildings, which are owned by Michigan-based Ottawa Tower II LLC and North Bay Drywall Inc. Profit Sharing Plan and Trust, are connected by the Phoenix Center Parking Garage.  Each building has a 1,400-person capacity.

Tower I has approximately 200,000-square-feet of rentable space. Tower II, with approximately 175,000-square-feet of rentable space, features a commercial kitchen with a dining area for 250 people.  Both buildings have eight floors, plus a mechanical floor on the ninth, reception areas, conference rooms, security and many other sought after amenities in an office setting, including direct access to the Phoenix Center Plaza and Amphitheater.

Previously, General Motors (GM) leased space in the buildings for many years.  The current tenants include various state governmental agencies.  The State is looking to expand its presence in Ottawa Towers, which would add to the income tax rolls of the City of Pontiac, as well as provide a much needed boost to local businesses as employees working in the Towers run errands, eat their lunches, and otherwise avail themselves of the businesses in downtown Pontiac.

About the Phoenix Center

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Completed in the 1980s as part of an urban renewal plan for Pontiac, the Phoenix Center is a three-story, approximately 874,000-square-foot parking garage structure which can fit up to 2,800 vehicles.  The top level of the garage includes a beautiful garden and entertainment plaza with a covered amphitheater.

The Phoenix Center is a unique and readily identifiable focal point in the City.  A portion of Orchard Lake Road runs underneath it.

The Purchase

In February 2008, North Bay Drywall Inc. Profit Sharing Plan and Trust purchased Tower I out of foreclosure for $1.35 million.  At that time, the company paid more than $1 million in back taxes just to clear the title.   Before any tenant was signed to move in, the new owners began making upgrades and repairs to the entire building.  Hundreds of thousands of dollars were spent fixing the elevators, upgrading lighting to energy efficient ballasts and lamps, converting the heating and cooling systems to a modern digital control system, and completing long deferred maintenance, by the City of Pontiac, to the Phoenix Center. GM, at great expense, installed fiber optic cables that are connected from Tower One to Tower Two that are fitted with a harness system within the Phoenix Parking Garage.

Approximately two-and-a-half years later, Tower II was purchased by the same owners and extensive and costly upgrades were made to this building as well.

We’ve compiled some commonly asked questions for your benefit below.

Q: What did it cost to build the Phoenix Center?

A: The Phoenix Center cost approximately $23 million dollars to construct in 1980.

Q:  What is the actual cost to “repair” the Phoenix Center?  Is demolition of the structure needed?

A: No immediate structural dangers or hazards to the operation were identified in the report commissioned by the EFM from Desman Associates.   Demolition of the Phoenix Center was not recommended by Desman.

Additionally, the owners of Ottawa Towers conducted and financed their own study, since the city did not, on how the demolition would affect the city and Ottawa Towers.  The results of these studies, which cost tens of thousands of dollars to conduct, require that at least a portion of the parking structure must remain if Ottawa Towers are to have sufficient parking.

Q:  Has the City of Pontiac been willing to discuss a compromise with the owners of the Ottawa Towers?

A:   No.  The Ottawa Towers ownership has made itself available numerous times to negotiate these issues. The City has refused to negotiate any resolution that doesn’t feature the total demolition of the Phoenix Center.  The Towers’ owners remain willing to assume management of the Phoenix Center in exchange for a nominal purchase price or long-term lease.

Q:  How much will demolition cost and where is the money coming from?

A: According to the original, unaltered Desman Report, the cost of demolition is estimated to be at least$6 million.  However, this cost would likely go higher, and there are no contingency reserves.  The question remains – wouldn’t the millions needed to demolish a perfectly good structure be better spent on pressing City needs?

Q:  What will it cost to repair the Towers if the Phoenix Center is demolished?  Who will pay for the repairs?

A:  Over $17 million.  The Towers would seek reimbursement from the City and the County.

Q:  Why is it so important for the Ottawa Towers to have parking for its tenants?

A:   Having convenient, safe, stable, and well-lit parking is an integral amenity for visitors and tenants. One of the building’s tenants, the Michigan Department of Human Services, is frequented by victims of domestic abuse, who appreciate the privacy and security of the Phoenix Center parking garage.

 Q:  Why does the City of Pontiac want to have the Phoenix Center demolished?

A:  No reason or coherent rationale has been provided.

Q:  Where will Ottawa Tower tenants park if the garage is demolished?

A:  When fully leased, the Ottawa Towers will need 2,600 parking spots.  There is insufficient available land within a reasonable proximity to the Towers to provide a sufficient number of parking spaces for the Towers to be viable in the future.

A parking study by one of the country’s top urban planning firms concludes that at least a portion of the structure must remain if the Towers are to have sufficient parking.

The only available large parking facility in close proximity to the Ottawa Towers is Lot 9, which was transferred by the Emergency Manager to a private company, Warco Holdings.  Warco Holdings is 50% owned by the son in law of L. Brooks Patterson, the Oakland County Executive.

The City of Pontiac has a viable, attractive and increasing tenant and tax base with Ottawa Towers.  In a city that needs committed and caring business owners and tax-paying tenants, why do they wish to risk losing an important office complex such as Ottawa Towers?