2016-09-22 / Front Page

Largest housing project cited by state DEQ

Concerns about Brewery Creek
By Eric Carlson
Of The Enterprise staff


MOLON EXCAVATING was hired to stabilize eroding soils at The Moorings, a 100-plus unit residential development between Carter Road in Elmwood Township and M-72 -- the largest such project currently underway in Leelanau County. A bitter legal battle is ongoing between developers and investors in the project that has otherwise halted construction. MOLON EXCAVATING was hired to stabilize eroding soils at The Moorings, a 100-plus unit residential development between Carter Road in Elmwood Township and M-72 -- the largest such project currently underway in Leelanau County. A bitter legal battle is ongoing between developers and investors in the project that has otherwise halted construction. The Michigan Department of Environmental Quality (MDEQ) has filed a violation notice against developers of The Moorings, the largest single residential project currently being developed in Leelanau County.

Work was being done this week to correct soil erosion problems affecting a wetland on the site, located south of Carter Road in Elmwood Township. A 12-acre portion of the project, known as Leelanau Flats, is located in the township while another 44 acres are located in a portion of Leelanau County annexed decades ago by Traverse City.

Since work on the project began last year, neighbors and passers-by on M-72 at the southern end of the property have taken note of the hundreds of trees removed from a hillside overlooking West Grand Traverse Bay. Some 91 single family homes are to be constructed on the Traverse City portion of the property with another 58 condo units in the Elmwood portion.

Progress toward developing the property apparently ground to a halt earlier this summer, however, when investors in the project took action to foreclose on a mortgage held by developers. In fact, several lawsuits have been filed involving developers Ted Lockwood and Bob Brick, and investors Mark Johnson and Jason Warren.

Developers Lockwood and Brick have a 58-percent interest in the development while investors Johnson and Warren, doing business as 447 Munson T.C., have a 42-percent interest. Investors have alleged that developers have mismanaged the project, forcing them to assume control of the project; while the developers alleged the investors are only interfering with them to enrich themselves.

In one of the multiple lawsuits currently underway, attorneys for both sides were expected to continue duking it out today in 13th Circuit Court in Grand Traverse County in front of Judge Thomas G. Power. Another set of legal actions has been filed in 13th Circuit Court in Leelanau County. A settlement conference in one case has been set for March 2017 with a non-jury trial slated to occur in April 2017.

According to court documents, Lockwood and Brick on Sept. 8 notified the investors that “funding delays have caused an emergent danger of significant environmental impact to the project, the surrounding wetlands and the Grand Traverse Bay watershed areas. There is an urgent need to stabilize the site…”

There are multiple wetland areas including creeks within the site, about 20 percent of its total acreage, according to court documents. If wetlands are compromised, “there is a very real possibility of major damage to the ecosystems of the wetland, streams and bay,” Brick and Lockwood told the investors.

On Friday, Sept. 16, the MDEQ sent a violation notice to Lockwood, indicating that the site had been inspected by an MDEQ official on Sept. 14.

According to the notice, the MDEQ inspector “observed the unlawful discharge of soils from the construction site to wetlands and a tributary of Brewery Creek.” The notice ordered developers to take action to correct the situation immediately.

Court documents related to a hearing scheduled to be conducted today in Grand Traverse County suggested that an engineer working for the developers would contact a local excavating company, Molon, to begin work to correct the soil erosion problem.

However, the investors have already done so.

Attorney Daniel Dingeman, representing investors doing business as 447 Munson, L.L.C., acknowledged that his clients had stepped in to take care of the issue after the MDEQ found that the developers’ efforts were “inadequate.”

“It is our understanding that the (MDEQ) is pleased with the swift actions taken by the lender (447 Munson),” Dingeman told the Enterprise. “The lender is committed to continuing to take all steps necessary to ensure the environment remains appropriately protected.”

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