Former residents of the Leland House apartments at 400 Bagley St. will each receive a $15,000 payment after a bankruptcy judge approved a settlement the week of Nov. 2, according to BridgeDetroit. The settlement, which could total more than $500,000, was negotiated by the Detroit Tenants Union on behalf of the 37 renters who were forced to leave the 21‑story downtown high‑rise in December 2023 when broken equipment caused a building‑wide electrical outage.
Steven Rimmer, chair and executive director of the tenants union, called the approval on Thursday, Nov. 5, “a significant victory for the displaced renters” and noted that such outcomes are rare in Detroit. He said the money will be dispensed in the coming weeks and emphasized that the tenants “organized, stood together and fought” after losing their homes and belongings.
The Leland House, originally opened in 1927 as the Detroit‑Leland Hotel, had operated on month‑to‑month leases and was declared bankrupt a month before the evacuation. The building was sold this spring for $3 million to Mudhish Development, a limited‑liability company linked to businessman Raad Gobah, who declined comment on future plans.
City officials absorbed significant costs while the tenants were displaced. Corporation Counsel Conrad Mallett Jr. told the Free Press on Friday, Nov. 6, that Detroit spent over $750,000 providing temporary housing at a Red Roof Inn in Southfield and expects to recover less than $150,000 from the bankruptcy case. Mallett said the city chose to forgo those dollars to help families “live their lives in a hopefully new and better circumstance.”
Judge Maria approved the settlement, directing that the $15,000 payments come from the proceeds of the building’s recent $3 million sale. The court documents indicate the city agreed to relinquish “a large portion” of Detroit’s own claims to make the funds available for the tenants.
While the new owners have not disclosed redevelopment plans, Mallett expressed interest in supporting any solid proposal, noting that “redoing the Leland House is a herculean task.”
What’s next: The $15,000 checks are slated for distribution in the next few weeks. Former tenants will also be allowed to re‑enter the shuttered building to retrieve any remaining personal items, pending final court orders.
Sources: bridgedetroit.com
