Action Follows the Developer Moving to Terminate Development Agreement and Initiating Legal Dispute. VBM photo of Mayor Weinberger, left, and Don Sinex at the original CityPlace announcement April 20,2016.
Vermont Business Magazine On Tuesday, September 8, the City of Burlington filed suit in Vermont Superior Court against BTC Mall Associates, LLC, the developer of the CityPlace Burlington project. The City also filed a motion for preliminary injunction to promptly compel BTC to build the public improvements as required in the written Development Agreement with the City.
Developer Initiated Legal Action
Prior to this filing, on Friday, September 4, the developer, through two letters from Don Sinex (manager of the BTC Mall Associates and principal of Devonwood Investors), informed the City that it was attempting to terminate the Development Agreement with the City, and that it was attempting to relinquish its existing zoning permit. These two letters are included below. Also prior to the City’s filing, BTC filed suit against the City seeking court approval of its unilateral termination of the Development Agreement.
The City maintains that BTC’s letters and its lawsuit demonstrate that the developer is attempting to avoid its contractual commitments to the City.
According to a statement from the City, the Development Agreement does not allow one party to unilaterally terminate the agreement once construction starts. 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.
Sinex was the original developer of the $200 million project when it was first proposed in April 2016. But the project lagged after most of the downtown mall was demolished. Sinex's financial partner, Brookfield Partners, took over the project. Eventually the plans were somewhat scaled back, then COVID hit and the economy both slowed and changed, and Sinex this summer assumed leadership of the project once again with new, local equity partners.
Sinex also vehemently opposed the City forcing the issue through the courts, which he feels is a waste of time and money, and a lawsuit the City will not win. Sinex has further scaled back the development, by eliminating the proposed hotel and reducing the amount of office space while focusing more on housing.
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In Accordance with Specifically Negotiated Terms, City Seeks Prompt Injunctive Relief from Court
The Development Agreement specifically gives the City the right to seek injunctive relief to compel compliance with its terms and requirements.
The City’s lawsuit seeks just that: to hold the developer accountable to the people of Burlington. It alleges breach of contract and breach of the implied covenant of good faith and fair dealing, and it seeks a declaratory judgment from the court that the Development Agreement is enforceable against BTC. Through the motion for a preliminary injunction and specific performance, the City is requesting the court to order the developer to immediately rebuild St. Paul Street and Pine Street, activate Bank Street and Cherry Street, and construct additional improvements to the public streets as promised.
City Remains Open to Settlement Negotiations Based on Terms of Existing Development Agreement
The City’s goal continues to be to transform this long-troubled part of downtown Burlington into a vibrant, mixed use neighborhood. The City is seeking to hold the developer accountable to its commitment to that vision. While the City remains open to mediation with the developer to advance that outcome, that discussion must be based on the existing Development Agreement.
“The City has complied with all of its obligations under the Development Agreement,” said attorney Marc Heath of the firm Downs Rachlin Martin PLLC, who represents the City in this litigation along with a team of litigators at the firm. “BTC’s unilateral attempt to walk away from its contractual obligations to the City is meritless. We intend to compel BTC to comply with its contractual obligations; specifically to provide the public improvements as required 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,” said Mayor Miro Weinberger. “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.”
For additional information, click below to see the following materials, also available on the City website:
- City of Burlington v. BTC Mall Associates – Complaint
- City of Burlington v. BTC Mall Associates – Motion
- BTC termination of DA letter to City
- BTC letter relinquishing zoning permit to DRB
The mall was demolished by August 2018, as seen in this VBM photo, and except for the removal of the vehicles and construction of fencing, it look pretty much the same today.
Source: Burlington, VT – Mayor 9.10.2020