Real estate’s most talked-about lawsuits of 2014
In 2014, some developers found themselves in legal battles that delayed projects, called into question agreements with local governments and destroyed relationships. Here are five lawsuits involving the real estate industry that made major headlines this year:
Ugo Colombo vs. Craig Robins
In a lawsuit that proves developers are not good at sharing their toys, a Miami-Dade jury on March 10 awarded condo builder Ugo Colombo $2 million stemming from his legal fight with the Design District’s developer Craig Robins. In 2010, Robins’ company Dacra Development Corp. filed a lawsuit against Colombo and his CMC Group. Robins alleged Colombo had agreed to buy half of his $22 million Bombardier Challenger corporate jet, but failed to do so. Colombo countersued, alleging Dacra failed to pay its share of the plane’s maintenance and purposely defaulted on a loan used to buy the aircraft.
Grand Central nightclub owners vs. Miami Worldcenter Associates
In the latest salvo in their ongoing war, the owners of Grand Central Lounge are looking to block their landlord, Miami Worldcenter Associates, from getting started on its massive mixed-use project that will bring a 765,000-square-foot shopping center and residential and hotel towers to a blighted 27-acre site spanning 10 blocks north of downtown Miami. An expo center and hotel also are planned by another developer on the site of the demolished Miami Arena. Earlier this month, Grand Central’s owners sued the City of Miami, alleging its development agreement with Miami Worldcenter Associates violates state laws and that it unlawfully gives the developer zoning exemptions from future requirements, such as obtaining liquor licenses. In a separate lawsuit filed months ago, Grand Central’s principals also sought to reverse the Miami City Commission’s approval to close three public streets to benefit the project. Previously, Worldcenter sued to evict Grand Central and tangled in court with the lounge’s owners following the closure of Grand Central Park, a temporary park that was on the site of the Worldcenter project.
Homeowners vs. Prive Aventura condo developers
Construction of a sidewalk is causing massive headaches for the developers of the Privé at Island Estates condominium in Aventura. Owners of existing single-family homes neighboring the proposed 160-unit towers sued the developer, BH3, to stop the sidewalk’s completion. The lawsuit has prevented BH3 from obtaining a foundation permit to begin construction of the condo building since the sidewalk is required as a condition set by the City of Aventura. According to a court transcript obtained by The Real Deal in October, BH3 principal Daniel Lebensohn said the sidewalk delay also prevented BH3 from closing on a construction loan. The homeowners contend the proposed sidewalk encroaches on their properties. However, BH3’s owners insist the sidewalk issue has not hurt sales. Earlier this month, they told TRD that Prive is 50-percent sold and sales for the twin 16-story towers have totaled $75 million over the past 75 days.
Venetian Islands residents vs. Flagstone Island Gardens and City of Miami
Mehmet Bayraktar’s vision for a megayacht marina and resort on Watson Island is slowly lurching toward fruition following more than a decade of missed deadlines and construction delays. Despite little evidence he’s started construction on publicly owned land awarded to him by the City of Miami in 2001, Bayraktar won key revisions to his development plan from the city and state earlier this year. But those changes could end up killing the mixed-use project. In September, two residents of the Venetian Islands who oppose Bayraktar’s Flagstone Island Gardens project sued the city to block the ambitious development from going forward. Stephen Herbits and Sharon Kirby Wayne allege Miami government officials violated the city charter and some key conditions in the ballot language authorizing the project votes approved in 2001. In a related lawsuit also filed in 2014, Herbits sucessfully sued the city for withholding public records on the deal.
Daria Gogoleva vs. Jeffrey Soffer
Fountainbleau Hotel owner and billionaire developer Jeffrey Soffer became the target of a wrongful death suit over his piloting skills. Intially, Daria Gogoleva sued Soffer in federal court, seeking $100 million in damages over a 2012 helicopter accident in the Bahamas that killed her domestic partner, Lance Valdez. She withdrew the federal complaint and refiled in circuit court in January. Seven months later, a Miami judge tossed her lawsuit. Soffer’s attorneys argued Gogoleva did not have the ability to file a wrongful death suit on behalf of Valdez because she was not his widow. Soffer has maintained he was not piloting the plane.