10 May Developer Sues The Kolter Group for Broken Deal
(FORT LAUDERDALE) May 10, 2016 – Richard Zipes, whose Las Olas River House condominium redefined the Fort Lauderdale skyline and led the transformation of the sleepy downtown into an exciting destination for urban living, filed suit April 28 in Broward County Circuit Court against Palm Beach-based development company, The Kolter Group, and its CEO, Robert Julien, for reneging on a deal to develop a parcel of land adjacent to Las Olas River House. The 38,325 square foot property is situated on the frontage of Las Olas Boulevard and is known as the River House Remainder Parcel.
Zipes’ development company, Omni Realty Development Corp., is seeking $15 million in damages for the breech.
“Kolter had no prior development experience in Fort Lauderdale,” said Zipes, “but based upon my prior success and relationship, an understanding was reached 18 months ago between our two firms to move together on various development opportunities.”
The agreement originated with an opportunity to acquire and redevelop the nearby One River Plaza, located at 305 South Andrews Avenue. They entered into a purchase and sale contract for the property, however, the seller could not perform under his contractual obligations and therefore, after seven extensions, the contract was terminated.
While still under contract to acquire One River Plaza, Zipes suggested to Kolter that they consider making a bid for the River House Remainder Parcel, which was being marketed by Robert Givens of CBRE. Kolter had already been offered the opportunity but passed. However, due to Zipes’ particular detailed knowledge of the property, and after much discussion, Zipes finally persuaded Kolter to try to acquire the property even though the first and second rounds of the bids had already closed without Kolter having submitted an offer. But at the very last moment, Zipes was able to insert Kolter into the bid process and they were selected as the buyer for the property.
As contemplated in the earlier Kolter agreement to work together, Zipes introduced Kolter to the architects, engineers and attorneys most knowledgeable about the development of the River House Remainder Parcel. In addition, Zipes arranged for and attended meetings with City officials, including the City Manager and the head of the Planning and Zoning department, and officers of the River House Condominium board of directors to present and discuss the development proposals for the property, for the most part requested by Kolter.
As the purchase contract got closer to execution, Kolter updated Zipes on the status of the execution and Zipes was invited to, and attended, the “kick-off” meeting for the project as a member of the development team in early May, 2015.
In late May, a Kolter-controlled entity entered into a purchase contract for the River House Remainder Parcel, with a closing contemplated in August, 2015. Shortly thereafter, Kolter stopped communicating with Zipes without any explanation.
Zipes stated: “I was invited to the party and brought my ‘A’ game, however Kolter would rather march to the drumbeat of ‘greed is good.’ That’s not how I have conducted myself for so many years.”
###