Vacant Detroit Hospital Building to be Auctioned Off in June: A Redevelopment Opportunity for Investors
A vacant hospital building in northeast Detroit is up for grabs starting June 24 in an online auction. The building at 4777 East Outer Drive, less than a mile south of Eight Mile and near the Bel Air Luxury Cinema, opened in 1946 as Holy Cross Hospital and underwent several expansions over the years. It was purchased in 1996 by what was then St. John Health and renamed St. John NorthEast Hospital.
St. John Health eventually closed the 295-bed hospital in 2004 amid dwindling patient counts. However, the building stayed open as a medical mall, hosting various clinics, social services entities, and an urgent care. It most recently operated as the Conner Creek Health Center until shortly after September 2023, which is when the hospital site's owner, a limited liability company called Conner Creek Center, filed for bankruptcy. The company had bought the hospital property in 2015.
A three-day auction for the hospital building and its 13.3-acre site is scheduled to begin Tuesday, June 24, and end Thursday, June 26. Bidding is to start at $400,000. The auction is marketed as a "lender owned redevelopment opportunity" being organized by the property's receiver, the Farmington Hills-based M. Shapiro Real Estate Group.
The Conner Creek Health Center reportedly had nearly a dozen tenants as recently as 2020, including a residential substance abuse treatment facility. On the same day that Conner Creek Center filed for bankruptcy – Sept. 22, 2023 – the owner sold a roughly 3-acre portion of the hospital's parking lot to a group looking to build housing for low-income military veterans.
The group broke ground later that fall on the 50-unit Benjamin O. Davis Veterans Village, which is named for the first Black general officer in the U.S. Army. The city of Detroit is contributing $1.4 million in funding for the project from its share of the $1.9 trillion American Rescue Plan Act of 2021. Bob Beale, general manager of the veterans village project, said they hope to finish construction soon and open the village to residents before the end of the year.
The Conner Creek property's bankruptcy did present some challenges to its own project, Beale said, as it essentially opened a $1.6 million hole in the budget. "So we paid basically all of their outstanding debts," he said of the hospital property's owner, "at least the outstanding debts that would affect the part of the property we were trying to purchase, with the anticipation they would pay us back. And instead of paying us back, they filed bankruptcy."
Beale said the old hospital building itself appeared to be in decent condition the last time he saw it from inside, which was 2023. "I am hoping that someone comes along and does something good with that property," he said. An attorney for Conner Creek Center LLC couldn't be reached for comment on Friday, June 20. U.S. Bankruptcy Court documents identify the owners of the limited liability company as 99% Dorothy E. McLemore Trust and 1% Andrew Gene McLemore Sr.
Contact JC Reindl at 313-378-5460 or [email protected]. Follow him on Twitter at @jcreindl. This article originally appeared on Detroit Free Press: Vacant Conner Creek Health Center in Detroit heads to auction.
