The Condemnation Case

UPDATE 10/21/2014: Finding that the City’s condemnation offer lacked the necessary good faith required by law, Judge Michael Warren dismissed the condemnation case against the Phoenix Center!  Read the full Opinion here.

Private property shall not be taken for public use without just compensation therefore being first made or secured in a manner prescribed by law.

“Public use” does not include the taking of private property for transfer to a private entity for the purpose of economic development or enhancement of tax revenues.

-The State of Michigan Constitution, Article X, Section 2

In its latest attempt to trample on the owners of the Ottawa Towers’ rights, the City of Pontiac, acting on questionable constitutional authority through appointed (and unelected) officials, filed a condemnation action of the entire Phoenix Center Parking Garage & Plaza on March 26, 2014. While the condemnation suit is pending, the other lawsuit has been put on hold. The condemnation action is pending before the Hon. Michael Warren in the Oakland County Circuit Court, and names the owners of the Ottawa Towers as Defendants in yet another heavy handed attempt by government actors to seize property rights.

As was the case previously, various government actors now seek to tear down the Phoenix Center through this new condemnation case, even though there is still no plan for what will replace it, and there remains no regard to the physical damage that will result to the Ottawa Towers office buildings, which are physically and logistically connected and integrated with the Phoenix Center.

The City of Pontiac asserted that the “public necessity” for condemning and demolishing the Phoenix Center consists of the following purported bases: (a) criminal activity in the Phoenix Center and concern for the people using the garage; (b) the maintenance, repair and operating costs for the center; and (c) lack of access to downtown Pontiac from certain roads. Ottawa Towers refute these claims as mere pretext to transfer the land underlying the Phoenix Center into private developers’ hands for undisclosed private purposes.

First, there is no evidence of unique or increased criminal activity in or around the Phoenix Center. To the contrary, throughout the pendency of their ownership, the Ottawa Towers have paid for and use independent security personnel and equipment to protect tenants and their guests as they visit the Ottawa Towers and use the parking garage. Ottawa Towers have invested more than $1,000,000 to repair and maintain the parking garage for the benefit of everyone who uses it, including restoring the lighting in the south side of the parking deck and in the portion of Orchard Lake Road that traverses underneath the Phoenix Center. In fact, earlier this summer the tunnel was re-opened to traffic for the first time in years, as a direct result of the Ottawa Towers’ efforts.

As was the case before, Ottawa Towers have once again offered to assume the repair, maintenance and operational obligations for the Phoenix Center, but their offers have been rejected outright by the City’s emergency manager, city administrator, and other unelected officials still bent on the demolition of the Phoenix Center. Instead of trying to resolve issues with the Phoenix Center, city officials continue to be entrenched in their mission to destroy the Phoenix Center and the surrounding office buildings.

There is also no basis for condemning and demolishing the Phoenix Center due to a “lack of access” to the downtown area. An Oakland County funded transportation study regarding the roadways in Pontiac states that the objective should be to widen Woodward Avenue in the loop area and restore two-way traffic so that it does not flow around the city center. There is no requirement or valid recommendation in any public study that any of the streets abutting the Phoenix Center be altered, neither are there any funds or plans to do so. The City should focus on the obvious and recommended change – updating Woodward Avenue – that does comport with the transportation study.

Ottawa Towers also challenges these government actors’ conduct because it appears in their opinion to focus upon placing the land underlying the Phoenix Center into the hands of private individuals for undisclosed private purposes. In advance of any court ruling authorizing the condemnation or the demolition, city officials had already granted an option to purchase one portion of the underlying Phoenix Center land to the entity that purchased adjacent parking Lot 9, Warco Holdings, Inc. Warco Holdings is 50% owned by the son-in-law of Oakland County Executive L. Brooks Patterson. Warco purchased Lot 9 in a private deal with the Pontiac emergency manager in June 2013 for less money than had previously been bid at a public auction sale, and Warco is now poised to increase its land holdings upon condemnation and demolition of the Phoenix Center. In the opinion of the Ottawa Towers, transferring public property post-demolition into the hands of any private developer, let alone one that is owned by a close relative of a public official, is a highly improper exercise of eminent domain power.