Howard Town Center Developer Sues University Over Project Termination
The developer behind Howard Town Center sued Howard University yesterday for alleged wrongful termination of the agreement between the two parties to carry out the Georgia Avenue NW mixed-use development.
The lawsuit from Howard Town Center Developer, LLC, led by the Rockville-based Cohen Companies, alleges that Howard canceled the agreement without proper notification, as laid out in the lease and subsequent agreement between the parties. Howard Town Center Developer, LLC is seeking a $100 million judgment and an injunction to prevent Howard from entering into any other agreements on the project or interfering with Cohen's ability to continue with the project.
"HU, most likely motivated by a desire to obtain a better deal with another developer, has ignored the clear terms of the various agreements governing the Project to eliminate LLC as the developer," the lawsuit states. "HU's precipitous termination of LLC not only is detrimental to LLC as the project developer, but harms the viability of the Project and, in turn, the public which could anticipate reaping benefits from the retail, residential and employment opportunities this multi-million dollar mixed-use project envisioned."
Howard and the developers, which also included CastleRock Partners, entered into an agreement to develop the property in 2010, following a land swap between Howard and the D.C. government that gave the university the Georgia Avenue site that includes the defunct Bond Bread building. The project was set to include 445 apartments above a Fresh Grocer grocery store and other retail. Howard Town Center Developer, LLC claims in the lawsuit that it has already invested more than $2 million in the project to obtain permits, prepare for demolition, coordinate with utilities, and other activities.
Last month, Howard terminated the agreement with Cohen "because developer failed to meet certain benchmarks under the ground lease and development agreements," according to an email from Howard spokeswoman Kerry-Ann Hamilton. The lawsuit alleges that Howard did not give the developer the 20-day notice before termination required in the original agreement. It also states that the developer experienced an "unavoidable delay" when the D.C. Preservation League submitted historic preservation applications for buildings on the property in February and the Historic Preservation Review Board approved the applications in May—forcing Cohen to modify the project design to preserve the existing facades.
Hamilton was not prepared to discuss the lawsuit, but I expect to have more information from her soon. Cohen developer Eric Siegel and the plaintiff's lawyer could not be immediately reached for comment.
Update 2:06 p.m.: Hamilton responds by email: "We cannot comment on the current litigation at this time. The University's goal is to continue working towards the successful implementation and completion of the Howard Town Center."
Howard Town Center rendering from the Office of the Deputy Mayor for Planning and Economic Development website