City of Detroit sues developer for commercial blight, more litigation forthcoming

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DETROIT (WXYZ) — The city of Detroit is working to hold developers accountable for leaving commercial buildings in disrepair.

In the last few weeks, the city brought about four lawsuits against developers Dennis Kefallinos and Julian Kefallinos with Southend Development Group and JDK Investments. The lawsuits are in reference to a church on Grand River Ave., a theater on Kelly Rd., a building on Wabash St., and a former hospital on 20th St.

The city says the lawsuits are a part of Mayor Mike Duggan’s Blight to Beauty initiative.

“This is not a situation where these are buildings in partial development. This is not a situation where we have been made aware that the owner of the property is engaged in a very sophisticated real estate identification process,” said Corporation Counsel Conrad Mallett. “These buildings are on what we call the M-100 list. These are buildings that we believe based on the lack of structural integrity, need to be demolished.”

Mallett says the city has brought litigation against the Kefallinos before.

“This is simply a situation where we have people holding properties, holding it in a condition that is injurious to the health and safety of people who live in the neighborhood and are really waiting for a moment where based on the progress the city has made, which by the way they’re holding back, but based on the progress the city is making for them to get a higher price for which they paid,” Mallett added.

The city provided documents showing they’ve issued several emergency correction orders on the Kefallinos properties over the course of the last few years but say the properties are still not maintained in accordance with city ordinances.

Kathy Schneider lives near the former hospital on 20th St.

“My building was a Mercantile, turn of the century department store. We had some lofts up on the second and third floor,” said Schnieder. “I have been here 24 years. I raised my kids here, brought my daughter home from the hospital here so they were raised in this environment.”

Schneider says there hasn’t been a lot of progress on the former hospital since she’s lived in the area.

“It looks like it’s coming apart. I think people are taking metal off. I’m not exactly sure but I really hope to see something be developed from that because that’s a good chunk of land,” said Schneider. “I think the city is vibrant. I think it’s alive. There’s so many great potential developments and I’ve had my fingers crossed for all of them.”

The city says the developers now have 21 days to respond from the date the complaints were filed. 7 Action News reached out to Kefallinos for comment multiple times Monday but did not hear back.

Mallett says the four lawsuits are just the tip of the iceberg. The city also recently sued Perfecting Church for failing to move development forward on a church. Mallett says with the help of seven additional attorneys, which the city was able to hire through the use of American Rescue Plan dollars, at least 17 more lawsuits are in progress.

The city also plans to soon begin bringing similar litigation against residential property owners. Over the course of Mayor Mike Duggan’s time in office, the city has begun demolishing a number of blighted residential properties.

“What we want by bringing these lawsuits is for the owner to accept responsibility, demolish the building and bring them, have that vacant space properly maintained until some more productive use of that land can be made,” said Mallett.

Mallett says the developers could lose their property to the city through the court process. If that were the outcome, Mallett says the city would demolish the buildings, maintain ownership of the property and sue the developer for the cost of the demolition.

1448 Wabash Complaint by WXYZ-TV Channel 7 Detroit on Scribd

12323 Kelly Rd Complaint by WXYZ-TV Channel 7 Detroit on Scribd

8236 W. Grand River Complaint Filed by WXYZ-TV Channel 7 Detroit on Scribd

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