A dispute over a sidewalk is causing delays for the builders of the Privé condominium in Aventura and hurting unit sales.
In a recent hearing for a lawsuit filed by three neighboring homeowners who are challenging construction of a four-foot wide sidewalk in front of their homes, BH3 principal Daniel Lebensohn testified that the suit has negatively affected sales, according to a transcript obtained by The Real Deal. BH3 is partnering with an affiliate company of Aventura developer Gary Cohen to build Privé. Lebensohn told the court the developers had received 77 reservations with six-figure deposits, but 37 of the expected buyers opted to take their refundable deposits back after the suit was filed.
An attorney for the developers and Lebensohn also said delaying completion of the sidewalk would mean they could not obtain a foundation permit. Without the permit, the developers could not close on a $145 million construction loan from California-based Canyon Financial.
Miami-Dade Circuit Judge Jerald Bagley granted a temporary injunction sought by the homeowners.
At issue in the case is whether the developers have the right to encroach on private property without the homeowners’ consent to build a four-foot wide paver sidewalk within a 10-foot utility easement along the outer boundaries of their three single-family properties. The sidewalk was mandated by the City of Aventura to provide for increased pedestrian traffic expected from the 160-unit, two-tower project. The developers received a permit for the sidewalk and site plan approval for the development from the city during the summer.
The homeowners want to prevent the developers from digging up their yards and landscaping without their consent and building the sidewalk on their land, according to the injunction. They claim a sidewalk “is not a public utility” and not an appropriate use for the utility easement.
BH3 and Cohen already constructed the sidewalk in the easement area of 12 of 15 properties within Island Estates. Those owners consented to the sidewalk construction, according to the injunction.
The injunction, issued Sept. 22, prevents the developers from finishing construction of the sidewalk and delays the start of the project planned on the eight-acre North Island, located between Williams Island and Sunny Isles Beach. The developers hoped to start construction by the end of September.
“This temporary injunction recognizes the importance of private property rights,” Susan Raffanello, the homeowners’ attorney, told TRD. She acknowledged the large-scale development would create a need for the sidewalk.
Despite the delay, BH3 principal Greg Freedman, insists the injunction won’t stop the development from moving forward. Freedman said the developers are trying to negotiate a settlement agreement with the homeowners. “These individuals are trying to throw a monkey wrench at us,” Freedman told TRD. “But it is not an impediment whatsoever.”
In August, homeowners David and Dara Clarke, Dan and Sheila Kleiman and Alan Reyf sued three entities controlled by Cohen in an attempt to stop the sidewalk’s construction. Their single-family homes are among 21 in a development known as Island Estates. Cohen also developed that project, which sits next door to the Privé site.
Despite his colleague’s testimony, Freedman, who repeatedly noted BH3 is not a defendant in the lawsuit, said that 95 percent of the sidewalk is completed and the project is not in jeopardy. Freedman also claimed sales have rebounded since the initial response after the suit was filed. He said about 40 percent of the project is under contract.
As part of the settlement discussions, Freedman said the developers have offered to remove the sidewalk and restore the original landscaping.
Freedman said “it is impossible to quantify” how many reservations were lost because of the sidewalk litigation.
Privé is planned for one of the last developable islands in South Florida. Units range in price from $2 million to more than $10 million.