Education group asking judge to throw out data center deal

The old Steelcase pyramid in Gaines Township. (Nov. 16, 2015.)

GAINES TOWNSHIP, Mich. (WOOD) — The nonprofit behind a proposed education center at the former Steelcase Pyramid is asking a judge to throw out the deal for a multi-billion dollar data center and force Steelcase to sell the property to them.

In a lawsuit filed Wednesday, the Education Campus Investors is suing Steelcase and Colliers Internation.

ECI claims they had a sales agreement for $3 million, which Steelcase backed out of in order to sell the property to Norman Development LLC, which is now in the process of selling the property to Switch for a massive data center projected to be worth billions of dollars.

The original plan was for Steelcase to donate the property to ECI for an education hub. However, ECI says Steelcase began to place restrictions on the use of the property, so the group decided to buy the pyramid instead.

ECI says they found numerous problems with the property and had Steelcase extend the time they had to inspect the property. However, ECI later terminated its sales agreement when Steelcase refused to further extend the inspection time under the agreement.

The lawsuit claims Steelcase eventually agreed to lower the sales price to $3 million if ECI quickly closed on the property.

Jerry Zandstra, who heads ECI, claims both sides agreed to the price and terms through email, and that should be considered a binding contract. Emails attached to the lawsuit show Zandstra proposed terms in an April 22, 2015 email, which was replied to by a Steelcase official.

The Steelcase official responds favorably to the proposal, but includes his own proposed terms, including the question “how would you fell about the following structure for the agreement” followed by additional terms. The lawsuit does not show any reply or agreement by Zandstra.

In May, Steelcase spokesperson Laura VanSlyke told 24 Hour News 8 that ECI had missed deadlines under the contract and pulled out of the agreement. When ECI pulled out they began looking at other offers.

In its lawsuit, ECI claims Colliers International interfered with the sale of the pyramid property. ECI claims Colliers had worked with the group to find possible tenants, and later brought Norman Development to the table to purchase the property, even though Colliers allegedly knew there was an agreement for Steelcase to sell the pyramid to ECI.

In the lawsuit, ECI is asking a Kent County judge to order Steelcase to sell the property to them for the agreed upon $3 million. They also ask the judge to assess damages against Steelcase and Colliers. ECI says it still wants to move forward with the proposed education center.

Curiously, Zandstra’s April 22, 2015 email includes a reference to a data center. In proposing terms of a sales agreement, Zandstra writes “no other side agreements with the exception of the data center.”

Zandstra’s attorney tells 24 Hour News 8 the data center that is being referenced is the one that is already on site and owned by Steelcase, and not the proposed Switch data center

Switch says the facility, which is waiting for the approval of state legislation, would be the largest data center campus in the eastern United States.

Once at full capacity, the pyramid facility would employ 1,000 people.

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