Luxury Aventura Condo Opponents Ordered to Pay Developer $26 Million
The recently completed Prive at Island Estates faced opposition from the homeowner association on nearby Williams Island.
February 01, 2018 at 03:02 PM
5 minute read
A homeowner association for affluent Aventura residents who opposed the neighboring Prive at Island Estates condominium is on the hook for $26 million in damages to the developer after fighting against the luxury project.
A jury on Tuesday agreed with the developer that Williams Island Property Owners' Association Inc. breached an agreement that prohibited it from objecting to the Prive development on the nearby private island.
The newly completed Prive is a 16-story, twin-tower complex with 160 units and panoramic views of Dumfoundling Bay. It's the only development on the 8-acre North Island, which connects by bridge to South Island, an enclave of about 22 single-family homes. Another bridge ties South Island to Williams Island and the mainland.
Waldman Barnett co-managing partners Glen Waldman and Eleanor Barnett and partner Jeffrey Lam in Miami worked on the case on behalf of the developer.
Kenny Nachwalter shareholders Jeffrey Foreman, Richard Critchlow, Deborah Sampieri Corbishley and Elizabeth Brooks Honkonen represented the association. They might appeal the verdict.
“We are confident that our next steps post-trial and on appeal if necessary will right what we believe was the wrong result,” Foreman said in an email.
The Williams Island Property Owners' Association filed the first of many lawsuits over Prive against developer Gary Cohen, claiming he has no right to build a condo tower in part because city zoning called for single-family homes on the island and a vested rights agreement to develop wasn't valid, according to the Oct. 18, 2013, amended complaint.
The Williams Island association said Cohen at first said he planned 17 single-family homes on North Island but then opted for a condo tower, prompting the lawsuit.
“Development on the North Island will undoubtedly disrupt residents' lives, increase traffic congestion, noise, and pollution and create a myriad of public safety concerns,” according to the complaint.
Since the lawsuit, Cohen, who inherited the island from his father, partnered with BH3 on Prive to form the development company Prive Developers LLC.
A February 2015 counterclaim filed by Prive Developers said a 1982 agreement barred the association from objecting to North Island development plans or encouraging others to object. That was the crux of the developers' argument at trial.
“That was the agreement that said, 'You won't mess with me, I won't mess with you. You won't encourage others to mess with me, I won't encourage others to mess with you with regard to the development of … (your) property,' ” Waldman said.
The Williams Island association breached the agreement with its lawsuit and by encouraging South Island residents to sue as well, Waldman said.
The agreement was penned following lawsuits between Cohen's father, Norman Cohen, and the company that bought Williams Island from him. It was signed by the elder Cohen and Williams Island Associates, from which the Williams Island association inherited the agreement, Waldman said.
Prive's damages claim was based in part on the argument that the opponents' lawsuits hindered its ability to get a loan from a traditional lender, Waldman said. Instead, he argued the developer had to go to a nontraditional lender for a loan at 16 percent to 18 percent interest when bank lending was strong and competitive rates were running at about 5.5 percent.
“ This was in 2014 and '15 when the market was just going crazy good and everybody was lending money,” he said. “We couldn't get money because of the litigation.”
One of the 16-story Prive towers was ready for occupancy in December and the other in January. About 40 units haven't been sold, and Waldman again blamed that on the lawsuits against the project.
He and his team have calculated interest owed by the association on the award will be about $5.9 million. The amount will be set when the judge enters a final judgment.
Williams Island is home to luxury residences of its own. The Mediterranean Village condo was built with input from actress Sophia Loren, and the 24-story, 70-unit Bellini tower was the last project built there, according to the association's website.
Bellini units on the market range in price from $1 million to $5 million.
Prive developers are working to sell the remaining units.
“The $26 million verdict is a victory and a success story for my partners and I, who are proud to have delivered a one-of-a-kind project to South Florida with more than 75 percent of the units sold, even after years of sales setbacks due to frivolous lawsuits,” Cohen said in part in an email. “We look forward to a clear and rapid path to sellout.”
The jury decision comes on the heels of another court ruling over a different Prive lawsuit filed by the developer.
The Third District Court of Appeal on Jan. 24 upheld the trial court in its dismissal of that suit, except for one part. The panel reversed the lower court saying it shouldn't have dismissed the developer's allegation that four South Island residents made false and malicious statements about the developer's right to build.
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