MUSKEGON, MI — Independent Bank has sought a court-appointed receiver over parts of the $85 Adelaide Pointe development, claiming developer Ryan Leestma lacks the “financial wherewithal” to deal with the project’s numerous issues.
In a formal complaint filed with the Kent County Circuit Court on Sept. 23, Independent Bank of Grand Rapids requested the appointment of a receiver over certain parts of Adelaide Point alleging Leestma violated his loan agreements with the bank.
Leestma and his companies obtained nearly $30 million in loans from Independent Bank to finance the construction of portions of 30-acre Adelaide Pointe development, according to the complaint.
The ambitious project sought to transform a contaminated former industrial site on Muskegon Lake into a premier boating destination that includes a 55-unit condominium building, boat storage facilities, a 169-slip wet marina and a multiuse building that houses Muskegon Brewing Company and a rentable event space.
The complaint lists the condo building, boat storage facilities, and boater services building as collateral for Independent Bank. The wet and dry marinas and the multiuse building are the collateral of other lenders.
Independent Bank alleged that in July, two promissory notes totaling more than $17 million matured and remain unpaid. The bank then sent Leestma a notice of default and reservation of rights.
In August, the two parties entered a short-term forbearance agreement to allow the bank time to evaluate Adelaide Pointe’s financial condition.
The short investigation revealed “significant issues that require the immediate appointment of a receiver,” the complaint read.
Among the issues cited were unpaid/delinquent real estate taxes in excess of $200,000, a $76,500 lawsuit filed by an Adelaide Pointe contractor, unpaid invoices to professional services providers in excess of $400,000, and demands by contractors who have performed work on the unfinished condo building and who claim to have been unpaid.
The complaint also noted a consent order from the Michigan Department of Environment, Great Lakes, and Energy that requires immediate remediation and payment of fines for unauthorized work.
“It is abundantly clear that Defendants lack the financial wherewithal to complete the Adelaide Pointe condo building construction, comply with construction requirements within a Cooperative Development and Use Agreement with the City of Muskegon (“Cooperative Use Agreement”), and complete environmental remediation,” the complaint read.
In response to the complaint, Adelaide Pointe CEO Aubrey Glick, claimed the issues with the condo building stemmed from nine months of construction delays and the unavailability of a demo unit to show prospective customers, all of which slowed the absorption rate of condos sold.
“We whole-heartedly disagree with the appraisal received by the bank as it foolishly assumed there would be no increase in the pace of sales once a demo unit was made available,” she said in an email to the Muskegon Chronicle. “Appraisers are not marketing or sales people and their perspectives do not always mirror reality especially with incredibly unique projects like Adelaide Pointe.”
In spite of the charges, Glick said Adelaide Point is “confident that Independent Bank remains committed to the project.”
“ There will be no impact to sold units all of which will be finished with certificates of occupancy in the next 90-120 days. There will be no impact to employees. There will be no impact to current or prospective customers. There will be no impact to the many business units that are actively growing. This is a condo issue,” she said.
Despite portions of the project remaining unfinished, Adelaide Pointe officially opened this past May, a full two years after Leestma and state and local official broke ground on the ambitious revitalization project.
The promising development, however, ran into numerous controversies throughout construction. Leestma received four EGLE violation notices in 2023 and 2024. Alleged improper dredging caused a large plume of sediment to migrate into the lake in April 2023.
In September, a plume of clumpy floating foundry fill was discovered leaving the site after dredging contractors failed to fasten sediment curtains across the marina opening.
The state also alleged Leestma violated his permits by expanding marina docks without authorization, widening site peninsulas beyond allowances, dredging and placing concrete in the water where he wasn’t allowed, hardening too much of the site shoreline with heavy rock and sloping shoreline banks too steeply to allow wetlands to regrow.
In August 2024, Leestma settled a yearlong legal battle with Terra Contractors, an excavation and underground utility company that claimed a nearly $1 million lien on the development for unpaid work.
Hudsonville-based Van Spyker Landscaping also had a lien against Adelaide Pointe claiming the developer still owed over $66,000 out of a nearly $108,000 contract, but the company discharged that lien in August, according to county records.
Shortly after the grand opening, Leestma, who from the beginning had served as the face for Adelaide Pointe, stepped down as CEO. He retains ownership of the company and other related businesses.
Leestma stepped out of the spotlight after formal mayoral candidate and longtime critic John Richard Allen posted a copy of Leestma’s March 7 letter to the U.S. Environmental Protection Agency that blamed Gov. Gretchen Whitmer’s “over-zealous, radical environmental and anti-capitalist policies” for threatening the project and his family’s livelihood.
The letter, which Leestma said he regretted writing, followed a settlement deal with the state in April that required him to pay $500,000 in civil fines and, where feasible, restore wetlands along manmade peninsulas that were stripped of vegetation.
The deal allows Leestma to escape $200,000 in penalties if the work is completed under certain deadlines.
The first-time developer has said he’s ultimately proud of what Adelaide Pointe has become, but his plans for additional development stages, including a hotel, restaurant and more condominiums are currently off the table.
“Some of it I didn’t know what was happening,” Leestma said of the project’s mistakes. “I fixed everything as fast as I possibly could. But crucifying a man that’s putting everything into making his town a better place — and overall doing a great job — is wrong. And social media gives people a platform to make people’s lives miserable and I just feel like I’ve gotten bullied to the point where it’s just not good for my mental health.”