Looking Back at The City of The Future

Jun. 16, 2008

Looking Back at The City of The Future
Lynnsy Logue The Real Estate Lady® and Condo Cando® in Charlotte, NC
Though Charlotte has different kinds of challenges than most of the country, we do have them.
The many condo tower announcements that came week after week...the drawings of how the city would look in 3 to 5 years...the condominiums' amenities...the sparkle, the dazzle, the excitement...and now the scuffle, the lawsuits, the claims. We have our challenges.
Here's the latest news:

Dispute plagues EpiCentre tower
Work on 50-story tower has stopped; $70 million lawsuit
From The Charlotte Observer By Kirsten Valle

A dispute between the developers of the EpiCentre and a luxury condo tower on the site has brought the tower's construction to a standstill, its developer alleges in a $70 million lawsuit filed this month.
Work on the 50-story 210 Trade building stopped in February, with two floors built, because of a disagreement over technical building-code issues. Until the problem is resolved, lenders will not finance the rest of the project, and county officials will not issue certificates of occupancy, the lawsuit says.
The suit was filed in federal court June 6 by a subsidiary of the tower's developer, Indianapolis-based Flaherty & Collins Properties. It alleges that the Charlotte-based Ghazi Co., which is developing the EpiCentre uptown, has failed to live up to contractual agreements and refused to cooperate with local and state requirements that would allow the condo construction to move forward.
At stake is the future of the EpiCentre, a high-profile mixed-use complex on the corner of Trade and College streets uptown. The project was conceived with a luxury residential building – as well as offices, retail, entertainment and a hotel. But the condo tower won't move forward until the suit is resolved, developers say.
The rest of the EpiCentre development is progressing. Its first tenants, including the Suite nightclub and Dale Earnhardt Jr.'s Whisky River bar, opened in recent months.
If the tangle is resolved in coming months and work on the tower resumes, its first residents could move in by summer 2010 – more than a year later than originally planned, Flaherty & Collins' attorney, Lee Spinks, said Monday.
“If we do not get the issues resolved, we are intent on getting every dollar back that we've spent or paid them, and lost profit,” he said.
The condo developer is seeking $70 million if the issues are not resolved and the project scrapped. If construction can continue, the company is asking for $28 million in damages, it said in the suit.
Ghazi Co. officials did not return phone calls Monday.
Construction on 210 Trade, which is being built atop part of the EpiCentre, started in October 2007 – and tension between the project's developer and The Ghazi Co. arose even before that.
In the lawsuit, Flaherty & Collins investors allege various physical and structural problems, including getting fewer parking spaces than they paid for. The company also says it's owed more than $2 million because of a provision in the contract that said the company would be paid if The Ghazi Co. erected a second tower on the site that would obstruct some condos' skyline views.
Despite the issues, construction moved forward, and developers sold 265 of the tower's 420 units.
In February, the condo tower's lenders, U.S. Bancorp and Corus Bankshares, ordered construction stopped after being informed of the developer's building code issues. The problem arose with the county's code enforcement department after it discovered the project had been filed as a single-owner building on the EpiCentre site, when ownership is actually being shared by the owners of the condo tower, the office-entertainment complex and a hotel that's going up on the site.
According to the lawsuit, The Ghazi Co. has refused to enter into an agreement that would place the development under a condo form of ownership, satisfying the code requirements. That has stalled the project and turned off lenders, the suit said.
“We have 265 buyers who are counting on our company to deliver their homes, but we have been thwarted by the (Ghazi investors),” Flaherty & Collins spokesman Mark Conover said in a statement. “They have refused to cooperate in providing reasonable and necessary agreements that are routinely required by lenders. … It is their refusal of lender requests that have delayed construction.”

Lynnsy Logue The Real Estate Lady® and Condo Cando® in Charlotte, NC