Detroit sues Leland Hotel owner for blight

BY KIRK PINHO

Troubles continue for the former Leland Hotel’s owner.

Michael Higgins and his a liates are facing a lawsuit from the city of Detroit alleging blight and improper building use at 400 Bagley St. is marks the latest legal complaint against him after a Detroit-based architecture rm sued last year for hundreds of thousands in unpaid work at the property. He also nearly lost it to tax foreclosure but has since redeemed it and is on a payment plan. And privately, some investors are asking for more accounting details for the property after a capital call.

In a lawsuit in Wayne County Circuit Court led in December, the city said Higgins, through his ownership companies 400 Bagley Corp. and Bagley Investment Co., has allowed the Leland to become blighted. City attorneys originally asked the court to order the 22-story building shuttered, but backed away from that when some of the emergency repairs were made.

Higgins said in an interview Wednesday that major issues with the building have been addressed, although some remain.

“We don’t have a certi cate of occupancy, but can’t until we renovate the building,” Higgins said.

“ ey’ve acknowledged we won’t be able to get one until we renovate it, but they’re still pushing it. ere’s a number of things that are unreasonable or can’t be obtained, and there are a few other things. ey wanted some more scraping of paint and things. But we are doing a major renovation of the building, and all of this is gonna get taken care of. We are having people stay in the building, at the city’s request. e city didn’t want us to put anybody out, which is obviously costing us a lot of money because we have a very low occupancy and we are having to run the whole building, but we agreed to do that. I think it’s all going to be settled.”

It’s been more than ve years since Higgins’ vision to overhaul the tower with a $120 million renovation were revealed, although work on that broader project has not started. Higgins said he is still working on securing long-term funding for the project through the U.S. Department of Hous- ing and Urban Development. e city’s December lawsuit is still proceeding because “the work is not complete and the building is not in compliance,” Conrad Mallett, Detroit’s corporation counsel, said in an emailed statement.

Higgins said there are about 60 residents in the building currently.

In the complaint, the city called the Leland “not t for human habitation and not safe for human occupancy.” e city continues to issue citations, of which there are at least 86 publicly identi ed in a city blight database. Several were issued in early February, and more were issued in late November and early December.

Contact: kpinho@crain.com; (313) 446-0412; @kirkpinhoCDB