The Redevelopment Agency voted unanimously last night to declare Carriage City Properties in default of its redevelopment agreement. Carriage City has 30 days to rectify the situation or the matter could head to Superior Court, Redevelopment Director and City Administrator Peter Pelissier said.
Before going into a 40-minute closed session to discuss the potential litigation, Pelissier told commissioners there hasn’t been much redevelopment activity except issues dealing with Carriage City Properties.
The city will begin inspecting units at SkyView at Carriage City Plaza to determine how many are rented and how many have been sold, Pelissier said in a brief interview after last night’s meeting. Carriage City has apparently turned to renting unsold units at the 220-unit, 16-story Irving Street building, advertising a lease to buy option on its Web site. The Redevelopment Agency contends that renting units is in violation of the Sept. 30, 2005 redevelopment agreement. Officials have expected Carriage City to come before the agency to revise the agreement since January, but Pelissier said the developer has been unresponsive.
The issue seems to come down to money: when the agency gets its $10,000 fee for each unit sold, but also, it has been paid for 46 units while 57 have closed. The redevelopment agreement indicates it is to be paid by the developer at closing, but if units are rented (thus, no closing), city officials expect the fee to be paid upon occupation of the unit.
It’s unclear how many units have been rented through the developer. With 76 temporary certificates of occupancy (TCO) issued by the city and 57 units sold, it’s conceivable that fewer than 30 are rented, but that also could mean as much as $300,000 in fees may be owed to the agency — if they are occupied. It’s also possible that those TCOs issued may expire. The agency has been paid for 46 units as of last month and no units have closed since then to my knowledge.