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Shopping center developer accuses site owner of conspiring against him

PropertyLaws and LegislationJustice SystemWalmart

The jilted developer of a planned shopping center in Remington claims in newly filed court documents that the property owner "contrived a plan" to terminate the sale of the 11-acre site and sell it to another developer instead.

Developer Rick Walker made the allegation May 29 in Baltimore City Circuit Court, in response to a lawsuit filed in March by Bruce Mortimer, whose family owns Anderson Automotive Group at 25th and Howard streets, where Walker was planning to build 25th Street Station.

Mortimer's motion for summary judgment asks a judge to uphold the termination of sale agreements with Walker's group, WV Urban Developments, so that Mortimer won't have any legal issues with selling the land. Mortimer has said he terminated the agreements because Walmart missed a deadline of Sept. 30 to sign a purchase agreement for its portion of the property.

Clipper Mill-based defense attorney Arnold Weiner, representing Walker and WV as defendants in Mortimer's lawsuit, filed a motion in opposition, saying Walker and WV have already spent $6.3 million on the project and making clear they would not forfeit that money without a fight.

Central to Weiner's case is his contention that Mortimer strung Walker and WV along with the intention of dropping them as developers.

"Mortimer, in concert with other developers, contrived a plan to encourage defendants to continue the development process so that Mortimer — once defendants had overcome all obstacles and obtained necessary approvals — could then declare the (property sale) agreements terminated, seize the fruits of defendants' hard work and turn (the site) over to a new developer, who would work in concert with Mortimer to develop the properties for their own individual benefits," Weiner's motion states.

Mortimer announced earlier this month that he is now selling the land to Seawall Development Corp., a local developer of affordable housing for young teachers. He called Seawall "a catalyst for change" in the Remington neighborhood.

Jon Laria, WV's Baltimore attorney, said last month the company has a valid contract with Mortimer,

"It's truly unfortunate that a good developer has been put in this position and that Seawall is now putting itself in the middle of this, but WV can't possibly walk away from $5 million and four years of sweat and blood on a project with such broad support from the city and community," Laria said last month, after Mortimer filed his lawsuit.

Mortimer would not comment on the response, and Seawall officials did not return phone calls seeking comment.

Weiner contends that Walker, a developer with 35 years of experience who has built 10 million square feet of commercial real estate — including the Rhode Island Plaza shopping center in northeast Washington — brought to Mortimer "a creative vision" for the property in Remington that Mortimer himself has praised on several occasions.

Walker and WV have spent $1 million alone to oppose lawsuits that were filed by four Hampden residents challenging the project as too massive for the area, Weiner states in his motion. Walker and WV also voluntarily paid to dig up a sewer "arch drain" and purchase a CSX easement — both of which were potential impediments to development of the site, the motion states.

Walker and WV incurred attorney fees and other expenses in lobbying successfully last year for City Council passage of Planned Unit Development zoning for the site, the motion states.

The development team also worked hard to keep Walmart from backing out of the project, knowing that Walmart was afraid of the residents' lawsuits challenging the PUD, the motion states.

In his motion, Weiner stopped short of naming any of the developers Mortimer might have consulted or conspired with.

Weiner also said he plans to file additional motions, "in order to prevent (Walker and WV) from falling victim to an opportunistic, unprincipled and unwarranted action" by Mortimer.

Weiner said it is "pretty typical" for developers to spend a large amount of money on projects before the sale is completed. He also said that Walmart was right to move slowly on signing its purchase agreement out of concern about the residents' lawsuits. Those lawsuits were dismissed by the Maryland Court of Appeals earlier this year.

Walmart, which had already signed a letter of intent, signed its purchase agreements March 29, nine days after Mortimer announced the termination of those agreements, according to Weiner's motion.

Weiner said that Walmart was worried about the PUD process and about the residents' lawsuits dragging on for years before a ruling was made. Walmart didn't want to commit to the project officially until those issues were resolved, Weiner said.

"I think that was a prudent business decision on their part," he said.

In his motion, Weiner said Mortimer appeared to have no problem with it, even telling a Walker associate at one point that he was "happy to proceed" with sale agreements, as long as he was comfortable that "we are pursuing every possible remedy."

Copyright © 2014, The Baltimore Sun
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