FRUITPORT TOWNSHIP, Mich. (WOOD) — The large gray husks of two half-finished buildings near The Lakes Mall are starting to draw the curious.
“Never seen anything like this before around here,” said Joan Schmitt as she sat in her car outside the two buildings in the 1900 block of East Sternberg Road, east of Harvey Street.
They were supposed to be new motels. Instead, they stand to be torn down or repurposed as part of a strange legal drama.
A judge halted the work back in June after ruling developers of the motels violated a no compete clause in an agreement with the owner of the newly-renovated Delta by Marriott, located near the site for downtown Muskegon’s new convention center.
Developer Jon Rooks bought the former downtown Muskegon Holiday Inn in 2013 from Detroit-area developer Stellar Hospitality LLC.
Because he’s planned to invest millions in the hotel, Rooks required the seller to agree to a no compete clause.
Under the stipulations, sellers couldn’t open a hotel in a 14-mile radius of the downtown hotel for 15 years — long enough for the Delta by Marriott to get established without the sellers turning around and becoming competitors.
Rooks invested about $10 million into the hotel so far and added a self-imposed room tax to help fund the new convention center.
But in March, he discovered a backer of the two Sternberg Road motels was one of the developers who sold him the old Holiday Inn.
Rooks contends that developer — Malik Abdulnoor — took on a silent role in the two motel projects.
Rooks claims that while Abdulnoor’s name was off the paperwork, he was a major financial backer of the motels. So, Rook to him to court.
Court files obtained by News 8 show in June, a Muskegon County Circuit Court judge agreed that Abdulnoor violated the no compete clause and directed him to “Disable, remove or demolish the buildings and structures they created on the Sternberg Road property.”
Abdulnoor can’t sell them to another hotel developer either.
News 8 reached out to Abdulnoor and his attorney, but neither have responded.
Rooks says he’s also open to allowing the buildings to be used for something other than a motel, possibly apartments.
In the meantime, the half-finished motels sit empty.
“It’s very sad,” said Schmitt.
“It’s sad for the whole community, when we’re trying to develop our community.”