Developer's property rights case against Hollywood upheld

, Daily Business Review

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Judge William Haury
Judge William Haury

Broward Circuit Judge William Haury on Friday denied a city motion to dismiss a compensation claim filed by a developer denied the opportunity to build a 15-story luxury condominium on Hollywood Beach.

Ruling from the bench without explaining his reasoning, Haury allowed the complaint of developer GSK Hollywood Development Group LLC to proceed. GSK sued in 2009 alleging a due process civil rights violation and lost property rights under the state Bert Harris Act.

GSK paid almost $4 million for two parcels—the former Mirador Motel and an adjacent apartment complex—in 2002 with city assurances that it could build a 150-foot condominium tower.

The Mirador project site was near the 24-story Summit condo tower, and neighbors protested the effect new construction would have on their views.

Without consulting the city planning director, then-Mayor Mara Giulianti proposed a zoning ordinance to restrict building heights in an eight-block area around the Summit building to 65 feet.

This met resistance from the City Council, which instructed the planning department to study a height reduction. The planning director returned with proposal for "transitional, step-down heights" that would have allowed the GSK project to proceed.

Two ordinances were considered, but Summit residents pushed for a flat-height ordinance, which the council 6-1 in 2006.

In 2006, GSK made its Bert Harris claim. The city responded by saying it would not change the ordinance or compensate GSK.

Dan Abbott of Weiss Serota Helfman Pastoriza Cole & Boniske in Fort Lauderdale, speaking for the city, argued GSK's claim should be dismissed because it never filed a development plan.

He cited a 2009 First District Court of Appeal opinion involving a changing height restriction that said, "until an actual development plan is submitted, a court cannot determine whether the government action has 'inordinately burdened' property."

Haury questioned the relevancy of the Tallahassee case because it didn't involve residential development.

GSK attorney Scott Marder of Duane Morris in Baltimore

Abbott cited case law concluding political motivations cannot be considered where the governing body can show it had a rational basis for its action.

"The rational basis is right in the ordinance—to mitigate the potential impacts associated with high-rise development and to ensure the preservation of the unique urban village ambience which characterizes this portion of Hollywood Beach," Abbott said.

Whether or not motivation could be considered became a major point of debate. Haury asked for case law, and Marder cited several cases, which Abbott substantially rebutted.

The argument appeared to come down to how discriminatory was the ordinance. Abbott emphasized it encompassed more than 200 parcels.

Marder focused on the council debate over the ordinance. He noted then-Commissioner and current Mayor Peter Bober, a partner in Bober & Bober in Hollywood, warned council members the flat-height option could exposed the city to a property takings claims in the tens of millions of dollars.

Giulianti lost on her first attempt to pass the ordinance and complained "they" could get whatever they wanted, Marder said.

"The only 'they' there were my clients," Marder said. "It was abundantly clear at these hearings that all of this was intended to stop my client's project."

Discussion of the project and designs contradicted the argument that this was some democratic "ordinance of general application," he said.

It was even suggested that GSK and the Summit residents negotiate what the project should look like.

The council "was giving the Summit the ability to control what was put on the Mirador project," Marder said. "That's improper. The Summit should not have the ability to dictate to GSK what it does with its property."

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