Friday, September 19, 2014

As expected, judge grants condemnation order for seven sites; extends deadline to file for compensation to two years

A judge's decision yesterday to grant a condemnation order (below) for seven properties in the Atlantic Yards/Pacific Park project site was a fairly routine process, as the Observer reported, with a new map being filed that transfers ownership to Empire State Development, the state agency overseeing the project.

(I wasn't in the courtroom, but I hope to update this with an account from an observer.)

But the judge did make one decision to give an edge to property owners, as reported by the Observer:
Michael Rikon, a partner at Goldstein, Rikon, Rikon & Houghton representing two of the property owners—at 700-714 Atlantic Avenue and 718-728 Atlantic Avenue—asked only that the court extend the deadline by which owners (er, former owners) must file for just compensation, which represents the next step in the process. Judge Wayne Saitta agreed, pushing it back from 120 days to two years. Mr. Rikon told the Observer that although he will file immediately on behalf of his clients, he was concerned that the smaller window might unfairly harm recently dispossessed individuals who were not represented at the proceeding.
The next steps are for the owners and the state to exchange property appraisals, which could lead to settlement or further litigation. No condemnee can be required to vacate until it is first paid an advance payment--typically a low figure, though supposed to be based on comparable properties.

"Judges hate to evict people from sites," Rikon told me, estimating that Empire State Development (ESD), the state agency overseeing the project, won't attempt a writ of assistance to actually force the sites to be vacated for several months.

DNAInfo reported:
Charles Webb, attorney for the ESDC, said demolition or construction on the seized properties will not begin until the buildings are vacant, but said it is unclear when current tenants must leave.
However, in a blog post published Thursday, StorageMart said the state has given tenants 90 days to vacate the building. The company said customers must remove their property from the storage facility by Dec. 18.
Rising value helps all sides

The negotiation process will proceed. “My personal experience is that [the state has] been low-balling the value of the properties,” Rikon told the Observer. “We’ve uniformly obtained more money than was appraised.”

Rikon plans to wait as close to the two-year deadline as possible to get appraisals done on behalf of his clients, two commercial properties on Atlantic Avenue. (Updated/corrected) The properties are valued as of title vesting date, which is this week, not when the appraisals are prepared, Rikon confirmed.

The rising market means a greater burden on the developer (now Greenland Forest City Partners) that ultimately pays the bill--as opposed to if the condemnation occurred years earlier--but the developer also benefits from the rising property values.

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