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Developer sues township to recover development costs

On Behalf of | Jul 22, 2016 | Real Estate Disputes |

A developer who was forced to abandon plans for an ambitious project on land owned by the Archdiocese of Philadelphia has now sued the township that repeatedly rejected his proposals. Like many real estate disputes, this lawsuit was generated by frustrated expectations.

In 2014, the developer outbid several competitors to win the right to acquire and redevelop 213 heavily forested acres in Marple Township. The developer bid $47 million for the development rights, and it also agreed to pay a non-refundable deposit of $5 million to the Archdiocese. The developer’s first plan proposed hundreds of town homes and several big-box stores, but the township rejected the plan as calling for too much density. The developer also requested a change in the zoning of the land from institutional and residential to “planned community.” The redevelopment plan was also opposed by people living in the vicinity because it threatened to destroy one of the last undeveloped parcels in the county.

The developer reduced the density and made other modifications in an effort to win the township’s approval, but the town board remained firm. The zoning dispute appears to have been the final straw. On July 1, the Archdiocese exercised its right to cancel the contract with the developer, and the land is now back on the market. The developer’s attorney said that the aim of the lawsuit was to recover $7 million that was spent in reliance on actions of the township. Those actions were not described by the lawyer.

The legal basis for the lawsuit is not clear. Generally, developers must spend their own money without any guarantee of reimbursement if their plans are rejected by the overseeing jurisdiction. Anyone who ends up in a dispute with a municipality over a rejected development plan or rezoning request will find it helpful to consult a lawyer who specializes in zoning and land use. Such a consultation can provide a useful analysis of the facts and the law that governs the case and the development of a legal strategy that will maximize the chances of prevailing in court.

Source: The Inquirer, “Plans nixed, developer sues Delco town to recoup $7 million he spent on Archdiocesan land,” Caitlin McCabe, July 14, 2016


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