Fort Lauderdale developer files suit against Kolter Group, seeking $15M

Richard Zipes is claiming Kolter cut him and his firm out of partnership to develop 100 Las Olas

May.May 10, 2016 06:00 PM

A Fort Lauderdale developer has filed a lawsuit against the Kolter Group seeking $15 million in damages, alleging that both parties agreed to develop a piece of land together that Kolter is pursuing solo. 

Omni Realty Development Corp. filed the lawsuit in Broward County Circuit Court on April 28, claiming that Kolter cut Omni out of a development at 100 East Las Olas Boulevard, which is known as 100 Las Olas.

Omni, led by developer Richard Zipes, developed the nearby River House, 42-story, 281-unit condo tower.

The lawsuit cites an agreement made in the fall of 2014 between Kolter, a West Palm Beach-based development and investment firm, and Omni to buy and develop together a different parcel at 305 South Andrews Avenue, as well as partner on other future projects.

In an exhibit to the lawsuit, a letter from John Csapo, Kolter’s chief development officer, to Zipes, outlined the original agreement, but said “Obviously a more formal agreement between us would have to be developed as this letter is not intended to be binding on either party.”

The deal for the 305 South Andrews plot, also known as the One River House property, fell through, and the contract was terminated by the end of 2014 because of the seller’s inability to comply with the terms of the contract, according to the lawsuit.

Meanwhile, Zipes allegedly approached Kolter to partner on the development of the property at 100 East Las Olas Boulevard. The suit states that Zipes introduced Kolter to the architects, engineers and attorneys for the project, as well as presented Kolter with a proposal and development plan outlining unit sizes, configuration analysis, financial analysis of the land cost, and providing renderings for the 100 Las Olas property, which is adjacent to Zipes’ River House.

In late May, Kolter stopped communicating with Zipes “without explanation” after a Kolter entity went under contract for the land, according to the suit. Since then, Kolter closed on the 38,325-square-foot plot for $17.25 million in August of last year. Kolter has proposed plans for a condominium and hotel project.

Csapo declined to comment on the lawsuit to The Real Deal, saying that the company does not comment on pending litigation.

“I was invited to the party and brought my ‘A’ game, however Kolter would rather march to the drumbeat of ‘greed is good.’  That’s not how I have conducted myself for so many years,” Zipes said in a statement.

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