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GRDadof3

Land hoarder strikes again!

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UP's favorite land hoarder, James Azzar, has struck again. Efforts by Lighthouse Communities to purchase land near Madison and Cottage Grove to be converted to a community park have been thwarted by this notorious land hoarder, who is also holding the Kendall Building, the Keeler Building and the old firehouse on Grandville Ave hostage (and vacant).

Park plans on hold - GR Press

David Allen, executive director of Lighthouse Communities, said his nonprofit agency, which helps neighborhoods create affordable housing, was ready to buy the 8-acre parcel for $550,000 this summer.

He and other neighborhood boosters were ready to kick off a $3.5 million fund drive that would have installed soccer fields, a picnic area and an amphitheater for community events.

Those plans fell apart when James Azzar, president of Extrusions Division Inc., refused to close on the property unless the group bought two other industrial properties he owned in the neighborhood
, Allen said.

Now, Lighthouse is paying $4,000 a month in interest on loans and has no property to show for it, Allen said. "We're considering a 'Save the South Park Legal Fund' to help offset our costs," he said.

In its Oct. 5 lawsuit, Lighthouse asked Kent County Circuit Judge Paul Sullivan to rule that Azzar must live up to his original agreement to sell the property.

It'd be interesting to hear more details on this.

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Ask the city to use eminant domain to get the land, then transfer it to Lighthouse. Or have lighthouse "contribute" to the city to have them build the park.

???

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Also, eminent domain the two industrial parcels held hostage. Donate those to Lighthouse.

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are you talking about the fire station on Grandville right downtown? It's Vaacant?

man... what a beotch! I would LOVE to have a place like that for my business/home.

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I'm all for "the greater good", but this is a capitalist society. If the guy wants to hold onto something until he gets the price/deal he likes, then good luck to him. One day I'd like to be in his position. Eminent domain has no place in a democratic society IMHO. The virtues of eminent domain are usually (not saying it's so in this case) extolled by the have-nots and the never-will-haves. Where is the incentive to do well and acquire property if we live under the constant threat that it could be forcefully purchased from under our feet.

Isn't he simply living "The American Dream"?

Andy (wannabe real estate mogul)

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I'm all for "the greater good", but this is a capitalist society. If the guy wants to hold onto something until he gets the price/deal he likes, then good luck to him. One day I'd like to be in his position. Eminent domain has no place in a democratic society IMHO. The virtues of eminent domain are usually (not saying it's so in this case) extolled by the have-nots and the never-will-haves. Where is the incentive to do well and acquire property if we live under the constant threat that it could be forcefully purchased from under our feet.

Isn't he simply living "The American Dream"?

Andy (wannabe real estate mogul)

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As you can imagine it is a long convoluted story. Here is a few details. Azzar was paid in full for this land by the County/ City Drain Commission when they turned it into a drainage field. However, the City never took ownership of the land they merely took a lifetime easement for drainage rights. Azzar then told the City the land had no value because of the Drain Commission's drainage easement and had the property taken off the tax rolls. He was paid $246,000 in 1992. The City, in the late 90's asked Azzar if they could put a park there and Azzar told them to jump in the lake. In 2005 pursuant to our Community Design Charrette, we asked Azzar to donate it to Lighthouse and we would name the park after his mother. He told us no. So we asked him how much he wanted for it. His asking price? $550,000. We decided that it would be in the community's interest to pay his ridiculous price and turn it into a park. We signed a buy sell and pulled together the funds to buy it. This was tricky as we could not launch the capital capaign with out ownership. So Lighthouse leveraged other assets we had to borrow the money to buy the park. Azzar's agent Steve De Haan set up the closing...all the money was at the title agency, and we were set to close. Azzar called two hours before the closing and said he refused to sell. We are suing him for breach of contract. In the mean time we are paying $4,000 a month on the loan we leveraged because we have to leave the loan in place in case we win our case. Lighthouse received a grant to cover the cost of the loan but cannot use the grant because we do not own it so we have the pay the $4,000. We are screwed until we win our case...which we will, but with Azzar it will take a long time!

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I would tend to agree with you in concept, but in this case, I think Azzar is in the wrong.

Come on, you want this property, you also have to buy these other two properties you don't want, but I can't sell them otherwise.

How is that fair business practice?

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PS: The gentlemen is very wealthy and didn't need the 10% at all. But I guess that's how you get wealthy and stay wealthy. (I can't operate that way, so I'll never be rich :P )

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As you can imagine it is a long convoluted story. Here is a few details. Azzar was paid in full for this land by the County/ City Drain Commission when they turned it into a drainage field. However, the City never took ownership of the land they merely took a lifetime easement for drainage rights. Azzar then told the City the land had no value because of the Drain Commission's drainage easement and had the property taken off the tax rolls. He was paid $246,000 in 1992. The City, in the late 90's asked Azzar if they could put a park there and Azzar told them to jump in the lake. In 2005 pursuant to our Community Design Charrette, we asked Azzar to donate it to Lighthouse and we would name the park after his mother. He told us no. So we asked him how much he wanted for it. His asking price? $550,000. We decided that it would be in the community's interest to pay his ridiculous price and turn it into a park. We signed a buy sell and pulled together the funds to buy it. This was tricky as we could not launch the capital capaign with out ownership. So Lighthouse leveraged other assets we had to borrow the money to buy the park. Azzar's agent Steve De Haan set up the closing...all the money was at the title agency, and we were set to close. Azzar called two hours before the closing and said he refused to sell. We are suing him for breach of contract. In the mean time we are paying $4,000 a month on the loan we leveraged because we have to leave the loan in place in case we win our case. Lighthouse received a grant to cover the cost of the loan but cannot use the grant because we do not own it so we have the pay the $4,000. We are screwed until we win our case...which we will, but with Azzar it will take a long time!

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Thanks lighthouseDave for the back story. I totally sympathise in your case, as you already had a contract. You're totally justified in that case.

I would tend to agree with you in concept, but in this case, I think Azzar is in the wrong.

Come on, you want this property, you also have to buy these other two properties you don't want, but I can't sell them otherwise.

How is that fair business practice?

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...

In response to NorthEnder, I'd have to say that there's no compuction for fairness in business. It's always been about supply & demand and whatever the market will stand.

...

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The thing is, Azzar doesn't see what he is doing as hoarding. It is my understanding that everything he owns is going to his family after he is gone so they can make a profit off of it as they see fit. Why he doesn't give it over to them now and stop torturing all of you now, i have no idea.

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The thing is, Azzar doesn't see what he is doing as hoarding. It is my understanding that everything he owns is going to his family after he is gone so they can make a profit off of it as they see fit. Why he doesn't give it over to them now and stop torturing all of you now, i have no idea.

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... In 2005 pursuant to our Community Design Charrette, we asked Azzar to donate it to Lighthouse and we would name the park after his mother. He told us no. So we asked him how much he wanted for it. His asking price? $550,000. We decided that it would be in the community's interest to pay his ridiculous price and turn it into a park. ...

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We have filed for breach of contract, however, we have also filed for damages. In this case the damages are significant here. Lighthouse paid $20,000 for a Capital Campaign feasibility study. As a part of this study over 80 interviews were conducted regarding our park plans. These interviews were with every major foundation in the City, and a myriad of major potential donors. Our study showed that we had the capability to raise $2.5 million for our park. We had received $150K in commitments already. All of this is lost right now because of his breach of contract. One could reasonably make the case that Azzar, cost us more in damages than what we were under contract to pay him for the park. I don't think it would happen...but wouldn't it be poetic justice if Azzar was ordered to sign the park over to us plus pay us money because the damages were more than the $550K we were scheduled to pay him? One can wish.

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We have filed for breach of contract, however, we have also filed for damages. In this case the damages are significant here. Lighthouse paid $20,000 for a Capital Campaign feasibility study. As a part of this study over 80 interviews were conducted regarding our park plans. These interviews were with every major foundation in the City, and a myriad of major potential donors. Our study showed that we had the capability to raise $2.5 million for our park. We had received $150K in commitments already. All of this is lost right now because of his breach of contract. One could reasonably make the case that Azzar, cost us more in damages than what we were under contract to pay him for the park. I don't think it would happen...but wouldn't it be poetic justice if Azzar was ordered to sign the park over to us plus pay us money because the damages were more than the $550K we were scheduled to pay him? One can wish.

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I'm also all in favor of private land rights. Eminent domain should be used sparingly.

What I question is how Azzar makes money on his properties. Sure, he's probably flipped some for profit, but his holding costs on buildings like the Keeler have to be pretty high. It's got to be costing a lot in taxes to just let the building sit there vacant. You'd think the holding costs would be an incentive to either do something productive with his properties or sell them.

On this particular property I'm not even sure what his angle is. He didn't want to sell the property outright, so he sold a permanent easement which made the land itself worthless. But now he's "sold" it for a lot more money than he paid for it, but backed out at the last minute? He's giving up a profit on an essentially worthless piece of property. Why would any rational person do that?

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I'm also all in favor of private land rights. Eminent domain should be used sparingly.

What I question is how Azzar makes money on his properties. Sure, he's probably flipped some for profit, but his holding costs on buildings like the Keeler have to be pretty high. It's got to be costing a lot in taxes to just let the building sit there vacant. You'd think the holding costs would be an incentive to either do something productive with his properties or sell them.

On this particular property I'm not even sure what his angle is. He didn't want to sell the property outright, so he sold a permanent easement which made the land itself worthless. But now he's "sold" it for a lot more money than he paid for it, but backed out at the last minute? He's giving up a profit on an essentially worthless piece of property. Why would any rational person do that?

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Property taxes and interest = write offs. Perhaps he's scared that getting a tenant in his buildings will make it less likely to sell it in the future (if a buyer wants to demolish or utilize all of the space). I don't condone it...just pondering as to why he would let them sit and rot.

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QUOTE (AlexPKeaton @ Oct 31 2007, 01:46 PM)

...Why would any rational person do that?

Aha. Another piece of the puzzle falls into place.

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True, except property taxes will cost more than the amount he'll save on income taxes. It's still a losing proposition. Wouldn't he much rather have a fully occupied building with a positive cash flow? He'd still get to claim property taxes as an expense and he'd be making a profit at the same time.

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