Developers of the completed Privé at Island Estates have agreed to collect a $21.6 million settlement from the Williams Island Property Owners Association, ending years of litigation over the construction of the luxury two-tower condo complex in Aventura.
Williams Island Property Owners Association had filed suit in 2013, seeking to stop the development. A jury in Miami-Dade Circuit Court on Jan. 30 awarded Gary Cohen and BH3 $26 million. He ruled that the association breached a 1982 agreement requiring that it not object or oppose future developments by Cohen on the 84-acre Williams Island. In addition to the $26 million, the association would have had to pay several million dollars in interest.
The $21.6 million settlement — plus nearly $2 million in attorneys’ fees — means each Williams Island condo unit owner will have to pay an average of $12,000 as part of the settlement. There are 1,975 unit owners. Williams Island Property Owners Association will not be able to further appeal the case.
The 150-unit Prive at Island Estates, at 5000 Island Boulevard, is 75 percent sold, with closings beginning in January. Condos range from 2,500 to 6,200 square feet and are priced from $2.3 million to $8.6 million.
Glen H. Waldman, who represented Privé’s developers, along with attorneys Eleanor Barnett and Jeff Lam, all of Waldman Barnett, called it “an amazing settlement.” He added, “when you have the other side agree — without exhausting their rights of appeal or exhausting post-trial motions — to pay over 80 cents on the dollar of a jury verdict, it’s almost unprecedented.”
Jeffrey T. Foreman, lead lawyer for Williams Island Property Owners Association, did not respond to email and voicemail requests for comment. His partner, Richard Critchlow, declined comment.
Documents show Williams Island Property Owners already paid $1 million to Privé and $80,000 to Cohen’s trust at the signing of the settlement late last week. The remaining $20.52 million is due on March 30.
The association is initially drawing on funds borrowed from a bank, and members have not yet decided if they will repay the loan in one lump sum or over time. A meeting of unit owners is scheduled for Thursday evening.
The settlement comes nine months after Miami-Dade Circuit Judge William Thomas, who presided over the case, dealt a blow to the association’s complaint and a separate lawsuit filed by the Island Estates Homeowners Association, which represents another group of nearby homeowners. Thomas ruled the statute of limitations had long expired for both associations to challenge a vested rights determination agreement.
Williams Island Property Owners’ Association originally sued the city of Aventura, Cohen and Prive Developers LLC, a partnership between BH3 and Cohen, in April 2013. The Island Estates group sued in October 2013 and filed a separate complaint a year later, accusing the city of allowing BH3 to build an illegal sidewalk that encroached on homeowners’ properties. A judge ruled in favor of Island Estates in October.
In the Williams Island case, Cohen and the Williams Island Property Owners Association were bound by a 1982 settlement agreement between the original developers of the luxury enclave in which neither party would interfere with new projects. Williams Island Property Owners Association violated the agreement by filing its lawsuit and encouraging Island Estates Homeowners Association to also sue Privé’s developers, Waldman said previously.
“These three lawsuits really hurt us,” he said previously. “Instead of being able to obtain a conventional loan at a 5.5 percent interest rate for a project that was awesome in terms of loan to value and contracts already in place, we could only get vulture funding at a 15 to 18 percent interest rate.”
As a result, the developers had to pay roughly $21 million in interest, Waldman had said. The ongoing litigation also put a cloud over the project that resulted in delays in selling out units. “Buyers were scared,” he said previously. “Brokers testified that they wouldn’t even go to the project. We should have sold out two years ago.”