Brookhaven city officials “maliciously abused governmental powers” to derail a $124 million mixed-use project along Buford Highway that was to include affordable housing, according to a developer and two homeowners who are taking the city to court.
Atlanta-based Ardent Companies had more than 20 homeowners on Bramblewood Drive on board in 2017 for a buyout of the neighborhood for redevelopment into 197 townhomes. But the deal fell apart as the city pushed for a mixed-use project with affordable housing and Ardent asked for tax breaks, and amid revelations the city had interest in acquiring some of the land itself for a public safety headquarters. The lawsuit accuses the city of conflict of interest and intentionally slowing the rezoning request to kill the project. Ardent is suing for an amount of money to be determined at trial.
The city denies any wrongdoing in court documents and in a written statement said that “the developer’s sour-grapes lawsuit is neither grounded in fact nor premised on actual events.”
Ardent Companies is suing the city in DeKalb County Superior Court, alleging officials violated its constitutional rights, partly by purposefully slowing the rezoning process of 17 acres on Bramblewood Drive and Buford Highway, leading to the collapse of the project a year ago.
The lawsuit also alleges the city required the company to revise its original project as part of a roughly $2 million “property swap” for approximately 2 acres of right of way on Bramblewood Drive.
“Ardent’s experience with Brookhaven serves as a cautionary tale to any developer trying to get in on Brookhaven’s hot redevelopment market,” according to the lawsuit that was filed in December.
“Brookhaven will give a developer the governmental approval it needs, as long as the developer pays to play,” according to the suit. “[T]he city and its officials consistently, calculatingly and maliciously abused governmental powers to obtain and protect their own financial interests.”
Ardent alleges the city violated a nondisclosure agreement by releasing more than 100 emails requested in an open-records request last year by the Reporter concerning the project. Ardent alleges in the lawsuit the emails included “confidential and proprietary information to the media,” including the anticipated $124 million total cost of the project.
In a press release last year announcing it was rejecting Ardent’s proposed mixed-use project, city officials said the developer demanded a massive, $30 million tax break. The city also said because Ardent would not agree on Brookhaven’s definition of “affordable housing” for the project, there was no choice but to say no.
“The [City Council] and administration are serious about their role to safeguard and manage the city’s assets for the benefit of all citizens,” city spokesperson Burke Brennan said in a Sept. 10 statement.
“The city worked diligently to try to find a path forward to make this project work for the city and for the developer,” Brennan added. “Ultimately, the parties could not reach an understanding on the scope and direction of the project and the developer’s sour-grapes lawsuit is neither grounded in fact nor premised on actual events.”
Ardent declined to comment on the lawsuit.
No trial date has been. The pretrial discovery phase is expected to be finished Sept. 30, according to court filings.
Ardent filed applications with the city in late 2017 to rezone the Bramblewood Drive and two parcels on Buford Highway property to make way for a 226-unit gated townhome development. The developer also asked the city to abandon about 2 acres of city-owned right of way on Bramblewood Drive for the townhome project.
Ardent had entered into purchase agreements with the more than 20 single-family homeowners on Bramblewood Drive, a dead-end street just south of Cross Keys High School. The contracts said Ardent would only buy the houses after getting the requested rezoning from the city.
Two Bramblewood Drive homeowners are joining Ardent in suing the city. Jon and Crystal Wheeler claim Brookhaven’s actions “interfered with [their] reasonable investment-backed expectations” that they would be able to sell their house to Ardent, resulting in an illegal property taking by the city. Other homeowners told the Reporter last year they believe they were harmed by the city’s actions.
Ardent got a recommendation of approval from the city Planning Commission for the townhome project with a design of 197 units. In June, however, the City Council postponed the rezoning vote for 90 days because council members said they wanted more of a mixed-use project along Buford Highway. They also wanted a mix of housing with different price points.
At the same time Ardent was seeking rezoning of the property, the city was considering buying some of the Bramblewood property for its own public safety headquarters, emails from the city show. The lawsuit called that a “clear conflict of interest.” The city ended up selecting a site on Briarwood Road overlooking the Peachtree Creek Greenway to build the new public safety headquarters.
The DeKalb County School District also looked at the Bramblewood property as a potential site to build the new Cross Keys High School during this time, but decided to build it at the former Briarcliff High School site in unincorporated DeKalb County.
Debate over cost of the Bramblewood right of way ensued. Ardent said it was willing to pay about $250,000 for the 2 acres; the city argued the land was worth much more and refused to abandon it.
Negotiations revealed in more than 100 emails released to the Reporter showed Ardent Companies in June proposed a $124 million mixed-use project on the property in response to the request from the city. The proposed project included $60 million to be spent on apartments and $64 million on for-sale townhomes and some retail. The mixed-use project was only discussed behind the scenes as part of an economic development proposal. No formal application was made to the city.
As part of the proposal, Ardent said it would price 10% of the project, or 30 residential units, as affordable housing. Ardent also requested a 30-year, $30 million tax abatement on all property taxes – city, county and schools.
The city required Ardent Companies to use an area median household income (AMI) of $50,000, while the developer insisted on using $68,000 household AMI to meet the 10% affordable residential units. That disagreement also led to the city’s refusing the project, according to city officials.
City officials said in emails they would agree to sell Ardent the right of way for roughly $2 million, which would then be reimbursed as part of a tax abatement.
As part of any tax abatement, the city also required Ardent to pay the city a portion of its profit if the property was sold within four years of occupancy. Ardent called this request a “kickback” in the lawsuit.
“Ardent refused the city’s improper demand to ‘pay to play’ as a condition of receiving the tax abatement,” according to the lawsuit.