OWOSSO — Based on a new structural engineer’s report, the city has temporarily closed the part of the James S. Miner Riverwalk Trail that runs along the west side of the condemned Matthews Building.
The report, delivered to the city Monday, recommends bracing, evaluating and reinforcing the exterior upper walls on the west portion of the partially collapsed structure. Department of Public Works employees blocked the trail section Tuesday afternoon.
“Out of an abundance of caution, the city of Owosso is temporarily closing the section of the River Trail which passes by the Matthews building,” City Manager Nathan Henne announced Tuesday on the city’s Facebook page.
Henne noted the city and the property owner, out-of-town businessman Nemer Haddad, have a court date set for July 13 on misdemeanor offenses.
For many months, Haddad has refused to make basic repairs to the building, which he purchased last fall with a plan to renovate the 31,000-square-foot facility into retail, commercial and office space, and upper-floor apartments. The estimated price tag is $8 million.
He is currently fighting three rounds of citations for city ordinance violations regarding the unsafe condition of the Matthews Building, which has a missing roof section and other basic deficiencies.
A June 15 public hearing on Haddad’s request for a city tax abatement — $561,000 over 12 years — for the Matthews Building was rescheduled for later this summer because the applicant didn’t show up for the hearing.
Haddad has been out of touch with Owosso officials for some time, Henne has said.
The city manager said Haddad owes the city fines totaling $6,000, plus enforcement costs. The court hearing in 66th District Court, originally set for June 8, has been postponed twice.
The Matthews Building, purchased by Haddad last fall, has long been targeted for redevelopment. A few months ago, the roof on the western section of the building collapsed, leaving the interior open to the weather. Officials have demanded Haddad fix the roof and make various other repairs to ensure the structure is stable and safe.
City officials have said they had hoped to avoid taking Haddad to court, preferring to obtain his cooperation instead. The city has extra leverage in its effort to get the building repaired: Haddad’s medical marijuana license, which the city is holding as collateral in an agreement he cut with the city.
Haddad had planned to place a marijuana retail store inside the Matthews building but then found out his state-financing deal was off because a marijuana-related business was involved.
He had intended to use the state funds to redevelop the building. Last October, city officials entered into an agreement with Haddad in which he promised to either rehabilitate or demolish the building within 36 months.
Under the agreement, Haddad guaranteed one of three outcomes:
n Rehabilitate the Matthews Building in partnership with the city, Michigan Economic Development Corporation by resurrecting plans for a “capital stack” of financing that included previously awarded city abatements, MEDC grant dollars and private investment; or
n If the capital stack doesn’t work out, bring the building up to code by making necessary repairs; or
n If the capital stack doesn’t work out, demolish the building in accordance with the city’s building code.
The parties also agreed the building would continue to be subject to code enforcement. In return, the city agreed to allow the new owner to relocate his planned marijuana provisioning center to a different building, within local zoning regulations.
“We have more leverage with the agreement,” Henne previously said during a council meeting. “(Haddad) could lose money if we revoke the (medical marijuana provisioning center) license. We hope they take it seriously.”
The Matthews Building has been vacant or underutilized for decades. About five years ago, local developer Randy Woodworth and partners purchased the building with a plan is to renovate the roughly 35,000-square-foot space into 20 or so high-end apartments, and office and retail space.
The section of the building that abuts the river, formerly a brewery, was to have been redeveloped into a brew pub.
In January 2019, Woodworth announced a scaled-back plan to develop the building section along the river into a restaurant, saying the cost to rehab the building was significantly more than the grant dollars lined up, making the project financially unfeasible. Then Woodworth sold the building to Haddad.