LANSING WILL ADD TO SKYLINE WITH NEW OFFICE COMPLEX
MATCHING PARKING RAMP ALSO SET TO BE BUILT ON VACANT DOWNTOWN LAND
By Andy Henion, Lansing State Journal
Originally published 12/19/2001

A vacant slice of downtown Lansing will be transformed into a 12-story office building and matching parking ramp over the next tow years - Lansing's largest private development in two decades.

Work will start soon on the $51 million Boji Complex just south of the Capitol at Allegan and Townsend streets, developers announced Tuesday. The complex is slated to open in Mark 2004.

The glass-lined, pale yellow and blue structure also is designed to house ground level stores and restaurants. No tenants have committed, but owners Ron and Louie Boji are working to lease space to a restaurant, drug store, bank customer-service center and others, Boji Group spokesman John Truscott said.

At least 20 percent of the 1,450 parking spaces in the nine-story ramp will be open to the public, Ron Boji said. The adjacent Ellis parking ramp, widely considered an eyesore, will be remodeled to resemble the complex.

Boji, who also owns the former Michigan National Tower across the street, said the new parking ramp is needed to support an eventual expansion of the 23-story tower, Lansing's tallest office building. That much publicized project is on hold until the flagging economy turns around, he said.

"This is just the beginning of what we're going to be doing," Boji said at a ceremonial groundbreaking Tuesday attended by a host of family, friends and politicians.

The development comes during a recession and with a glut of vacant offices. There's 286,000 square feet of vacant space in downtown office buildings, up 28 percent from last year, said Eric Rosekrans, who analyzes the Lansing office market for CB Richard Ellis Martin, an East Lansing real estate management firm.

Rosekrans said it's too early to say whether the new complex will hurt the market more. The economy could rebound in tow years, he said. If not, there still should be demand for older buildings because that office space typically is cheaper, he said.

"A developer has a gambler's attitude. They have to," Rosekrans said, noting that the Boji Complex is the largest private development since One Michigan Avenue was built about 20 years ago.

"If the market continues to go down and we get into a flat-out depression, then, yeah, there will be a problem," he added.

Despite the soft economy, Truscott said it's a great time to finance the deal with interest rates so low. He doesn't expect any problems leasing the new office space to lobbyists who need quick access to the Capitol.

"It's the best location in town and it offers parking," he said.

The complex can accommodate an estimated 500 jobs, according to the state, although that doesn't necessarily mean the jobs would be new to the central business district. Potential tenants could move form one downtown building to the other.

Nancy Parsons, a Lansing resident who works downtown for the state Department of Environmental Quality, said she hopes the complex will bring in retailers that carter to resident after 5 p.m., when most downtown businesses close.

"Depending on what they put into the building will determine how successful it's going to be," said Parsons, who will be able to see the new complex from her office in Constitutional Hall, a new state building.

The developers spent 18 months negotiating the complicated project with nearby Accident Fund Co., and city and state officials.

The Bojis bought some of the 1.5-acre parcel form Accident Fund and are leasing some from the city. The state gave the city the downtown parcel in return for land at the Capital City Airport on which to build a Michigan National Guard maintenance center.

State legislators even had to pass a law to give up a Senate staff parking lot to make room for the structure. Those staffers will get parking in the new ramp.

"This deal was more complex than bringing in the tow new (General Motors Corp.) plants because there were so many partners," Mayor David Hollister said.

Gov. John Engler said he hopes the complex will continue bringing more resident downtown. He also welcomes the new façade facing the Capitol along Allegan.

"Downtown Lansing has undergone a very positive revitalization in recent years," Engler said.

The Michigan Economic Development Corp. will give the Bojis a $5.5 million business tax break on the complex. The MEDC also gave the city a $5 million loan to help with construction.

When the complex is finished, the city will get an estimated $870,000 a year in property taxes and a share of the Bojis' parking revenue.

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