Stalled developer turns to courts
After nearly six years and more than $10 million spent to plan and win town approval of the commercial and residential redevelopment of the former Reader”™s Digest Association campus, thwarted partners say they”™ve had enough of delays by New Castle officials in a “sham” project approval process.
They”™ve turned to the courts for relief.
Summit Greenfield, the Southport, Conn.-based partnership that paid $59 million in 2004 for the 114-acre property, has asked state and federal courts to have the town compensate them for blocking their Chappaqua Crossing project and depriving them of the property”™s economic use. They claim the town board, pressured by New Castle residents, wants to preserve the largely vacant campus as an “unusable icon” to protect the values of neighboring multimillion-dollar houses.
The plaintiff”™s attorneys also claimed the town wants to keep out affordable housing that made up 20 units of a proposed 199-unit multifamily complex on the property ”“ the latest scaled-down version for a development of townhouses and condos that had 348 age-restricted units when first proposed by Summit Greenfield five years ago. Attorneys in court filings claimed the town wanted to “discourage racial minorities, elderly people, and the socioeconomically disadvantaged from purchasing property in New Castle.”
In a complaint field Feb. 25 in state Supreme Court, Summit Greenfield”™s attorneys argued the town in effect has taken the private property and should be required to pay just compensation to the owner.
In a complaint filed the same day in U.S. District Court for the Southern District of New York, the developer seeks compensatory and punitive damages from the town and the three town board members voting on the redevelopment project. Two town board members have recused themselves from project votes.
Attorneys called “irrational and nonsensical” the zoning restrictions on the former Reader”™s Digest headquarters that limit occupancy of its 700,000 square feet of office space to four tenants and require one tenant to occupy at least 200,000 square feet. The restrictions have directly contributed to the building”™s 88 percent vacancy rate, attorneys claimed.
The property has lacked the legally required major tenant since Reader”™s Digest, having shed its long-term leases at Chappaqua Crossing in a 2010 bankruptcy restructuring and corporate relocation to midtown Manhattan and downtown White Plains, last December completed its move from its landmark building.
Potential tenants for spaces larger than 10,000 square feet in the northern Westchester market are “exceedingly rare,” the plaintiff”™s attorneys noted. Â Chappaqua Crossing”™s three current tenants ”“ Fiber Media, Mount Kisco Medical Group and Northern Westchester Hospital ”“ occupy about 100,000 square feet combined.
Attorneys portrayed the town”™s delays and missed deadlines in the land-use review process as part of a “long and persistent history” in New Castle and other Westchester municipalities of “unlawfully thwarting the development of affordable housing, including multifamily housing, within their borders.”
Thirty-five years after the New York Court of Appeals struck down New Castle”™s zoning code as exclusionary, the town “still has not shouldered its share of the region”™s obligation to provide affordable housing,” attorneys claimed.
The developer”™s attorneys claimed the town”™s “willful tactic of delay” and demands for additional and redundant project studies have forced Summit Greenfield to spend more than $10 million “for a process that should have cost half that amount.” The developer”™s costs include more than $2 million in fees for consultants and attorneys retained by the town.
A spokesman for the developer said the project study required as part of the state environmental quality review process has reached 10,000 pages with 22 different versions of the redevelopment plan as requested by the town.
New Castle Town Supervisor Barbara Gerrard on the town website recently said the town board intends to finish its review of and adopt the developer”™s final environmental impact statement and act on Summit Greenfield”™s requests for zoning changes at Chappaqua Crossing by March 31. The board in late 2010 again raised several concerns about the project as proposed, prompting the frustrated developer to begin legal action to protect its investment.
Gerrard said no decision has been made on the project. But attorneys for the developer in the lawsuits claimed town officials already have shown their unwillingness to allow any development on the property. Instead they want to maintain a “sleepy, park-like campus atmosphere” that benefits neighbors of Chappaqua Crossing at the expense of its owner, attorneys claimed.