The city of Burlington has filed a lawsuit against City Place developers in an effort to compel construction on the project that has been stalled for years.
The lawsuit, filed Tuesday, alleges that City Place developer BTC Mall Associates, LLC, breached contract with the city and is not moving forward on construction responsibilities laid out in the development agreement.
The development project has sat barren in downtown Burlington since August 2018 when demolition finished. The pit has remained while leadership of the project changed multiple times and promises of financing and construction start dates came and went. The $220 million project promised to bring housing, retail and office space.
On Sept. 3, manager of BTC Mall Associates Don Sinex sent a letter to the city stating that it is attempting to terminate that development agreement. Sinex described the development agreement as “mutually abandoned and terminated by the parties by virtue of the impossibility of performance.”
BTC Mall Associates also filed a suit against the city, seeking to terminate the development agreement.
This letter and lawsuit, the city argues, shows that BTC Mall Associates and Sinex are “attempting to avoid its contractual commitments to the City.”
“The Development Agreement does not allow one party to unilaterally terminate the agreement once construction starts,” according to a statement issued by the mayor’s office.
“Remarkably, the developer is attempting to shirk its responsibilities by arguing that construction never started, despite the clear facts on the ground and the Development Agreement’s terms that construction starts with structural demolition of the former mall building,” the statement said.
The city is also requesting that the developers begin construction on the public works agreed to in the development agreement. Specifically, that means rebuilding St. Paul Street, Pine Street and activating Bank Street and Cherry Street.
In an emailed statement to VTDigger, Sinex said he thinks the city’s action is “imprudent and wasteful.”
“The action is completely without merit and the development agreement was terminated by BTC Mall Associates prior to this action being filed,” Sinex wrote. “BTC Mall Associates will vigorously defend itself and ultimately prove that the development agreement has been terminated and is therefore null and void and that the action taken by the City will therefore be dismissed by the court. “
“If the City spent more time working with Devonwood and less time contriving illusory legal claims then the City might be a step closer to seeing the project started. The City’s action yesterday will only result in a long delay in the start of the project and in the end the city will gain nothing from this action,” Sinex wrote.
Burlington Mayor Miro Weinberger argued in the city’s statement about the lawsuit that Sinex and BTC Mall Associates are attempting to avoid responsibilities laid out in the development agreement.
“The developer’s recent letters make explicitly clear that it is attempting to renege on its longstanding, binding commitments to the people of Burlington by arguing that it never started construction,” Weinberger said.
“Anyone who has looked at the construction site in the last two years knows that’s absurd, and we’re not going to let them get away with it. With this lawsuit, we are fighting for the reconnected and dramatically improved public streets and infrastructure that Burlington has been promised, and ultimately, for the widely shared vision of restored homes, jobs, and vitality in this long-troubled part of our downtown,” the mayor said.
At a Thursday afternoon press conference, Weinberger said the city can’t remove Sinex from the project because he owns the land.
“A lot of people are under the impression somehow that this is the city’s land and we chose this developer and if the developer’s not performing, why don’t we just throw them out?” Weinberger said. “That is really not at all the nature of this agreement.”
Therefore, a civil suit to compel the project forward is the next best step for the city to take, Weinberger said.
“I think if any of us put yourself in a situation where you had made with another party an agreement, the first thing you would attempt to do, if a problem arose, dispute arose, is you would try to get them to make good on their agreement,” Weinberger said. “Not try to come up with some entirely different arrangement.”
Weinberger also attempted to clarify past comments he made about Sinex taking over control of the project. In July, he said Sinex’s return to leading the project would be “unacceptable” to the city.
At the press conference, Weinberger said he was concerned that the new developers led by Sinex had not provided any proof of funds to show that they can successfully complete the project. But now, he said his patience has run out.
“Our patience is over,” he said. “You have a legal obligation to do this.”
Attorney Jen McDonald who is representing the city in this lawsuit said that despite the pandemic holding up court proceedings, zoom hearings are being conducted. She said the city’s intention is to get the legal process moving as quickly as possible to move forward with hearings.
Ed. Note — This story was updated with comments from Thursday’s press conference.
