One of the more ambitious housing redevelopment projects in Detroit needs a bit more time before construction work can start.
The developers of the long-vacant Lee Plaza in Detroit, who once hoped to begin work on the 16-story tower by early 2023, are now asking city officials for a third extension to the project's original timelines.
The city's approval is needed because Detroit still holds title to the tower at 2240 W. Grand Blvd., which is located about a mile west of New Center, and it entered into a development agreement back in 2021 with the project's codevelopers — Detroit-based Roxbury Group and Ethos Development Partners.
The developers plan to transform the vacant building, which dates to 1927, into a mix of market-rate housing (60 to 70 units) and affordable housing for seniors (117 units).
They are asking Detroit City Council to approve an extension until Nov. 30 to close on the $350,000 purchase of the tower from the city, and to then get a full two years to complete the project's initial phase, which would be the 117 units of senior affordable housing on floors 2 through 10.
The developers previously pointed to rising construction costs and a $10 million gap in the project's financing plan as reasons for the earlier extensions.
The latest request was discussed Thursday at a meeting of council's Planning and Economic Development Committee, which is expected to take up the request again later this week.
At last week's meeting, Councilman Fred Durhal III said the Lee Plaza redevelopment is very complex and he doesn't blame the developers for needing additional time.
“I’m not insinuating that this was any fault of the developer," Durhal said. "Again, this is a monstrosity of a project; to take this project on you’ve gotta be very brave I believe. And I know they have been very aggressive with this project.”
David Di Rita, principal of the Roxbury Group, on Monday told the Free Press that they do need additional time to close on the project's financing as well as on the property purchase.
"We appreciate the ongoing collaboration with City Council and the mayor’s office in completing the financing on this complicated but important project," Di Rita said in an email. "While we have identified all key financing sources, it was clear we needed a bit more time to finalize the documentation and get to the closing table. That said, we anticipate beginning preliminary construction activity at the site within the month."
The redevelopment project would make use of various incentive programs, including low-income housing tax credits, $7 million in federal relief from the 2021 American Rescue Plan Act and a $6 million grant from the state.
Lee Plaza originally opened as an upscale apartment hotel and was named for its developer and first owner, Ralph T. Lee, who built apartment buildings throughout Detroit in the early 20th century. The building was converted to senior public housing in 1969 after experiencing a big drop in occupancy after the 1967 Detroit uprising.
City housing officials permanently closed Lee Plaza in 1997 because federal funding for the senior units wasn't keeping pace with maintenance and operations needs.
After a mid-2010s effort by Detroit native Craig Sasser to redevelop the building as upscale housing fell short, Roxbury and Ethos Development stepped forward with their plans.
More: Long-vacant beauty Lee Plaza set to be restored, will feature senior apartments
Contact JC Reindl: 313-378-5460 or jcreindl@freepress.com . Follow him on X @ jcreindl .
This article originally appeared on Detroit Free Press: Developers of Detroit's long-vacant Lee Plaza request 3rd extension on project timeline
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