Developer Threatens Suit as Southwest Residents Seek Landmark Status
A legal battle is heating up near the Southwest Waterfront as condo owners seeking historic landmark status for their building in an effort to head off adjacent development have been met with threats of a lawsuit and financial damages from the developer.
The Bernstein Companies are hoping to construct three new buildings alongside two 1960 residential towers on 3rd Street SW designed by the architect I. M. Pei: two 11-story buildings straddling the existing ones and facing M and K streets SW, and one three-story building between the two originals. In an effort to prevent the development and maintain the public space between and around the buildings, residents are seeking landmark status for the Pei buildings and their grounds. If the property were to be landmarked, Bernstein would not be able to build there without permission from the Historic Preservation Review Board. Bernstein bought the property in 2006.
"If you look at Pei’s design, the space around buildings was a big part of the design," says Josh Zembik, condo association president at the Waterfront Tower at 1101 3rd St. SW. "We sought landmark status, and when that showed up on our board meeting agenda, we had some interest all of a sudden from the developer."
Shortly thereafter, Zembik says, he received a letter from Bernstein's lawyers threatening suit for violating the terms disclosed to purchasers of the building's units through a Public Offering Statement, which the letter says "explicitly state a 'reserv[ation of] the right to develop additional density on either parking lot and to build up to the fifth floor of the existing buildings in the area between the two buildings.'"
"Please be advised," the letter instructs residents, "that any action taken by any unit owner of the Waterfront Tower Condominium, or any action taken by the Unit Owners Association or its Board of Directors, to oppose or hinder the Developer's proposed redevelopment of the Property constitutes a material breach of the obligations imposed upon such persons by the express terms of the Public Offering Statement. Specifically, the document provides that:
The letter then advises residents to "refrain from taking any of the actions discussed at the recent Board Meeting, including speaking in opposition to the proposed redevelopment at the upcoming ANC meeting, hiring a zoning and/or land use attorney to oppose the redevelopment, or taking any other action that would oppose or hinder the proposed redevelopment." The lawyers for Bernstein then threaten residents who violate these terms with a lawsuit and liability for costs incurred by the developer as it fights efforts to prevent the development, including legal fees, employee time, and lost business opportunities.
Advisory Neighborhood Commission 6D is holding a meeting Monday evening at which it will discuss the proposed development, which requires zoning approval.
It's unclear whether Bernstein's attempted gag order on speaking out against the development would hold up in court. Zembik says the condo owners have attorneys looking into that question. He says he does not recall signing the Public Offering Statement, and if he did, it was "absolutely not" made explicitly clear to him and other residents that they would be unable to oppose neighboring development. Bernstein did not immediately respond to a request for comment, nor did the Historic Preservation Office.