TEMPLE TERRACE — While the city’s grand plan for a revitalized downtown flounders, attorneys are battling it out in court.
Temple Terrace filed suit against the developer last month, alleging breach of contract for failing to move forward with the second phase of the project. And just last week, the developer, Vlass Temple Terrace LLC, filed a counter-claim and asked that the case be moved to federal court and arbitrated.
For now, only the first phase of the downtown revitalization is complete on a project meant to turn a faltering area into a bustling, pedestrian-friendly town center.
It all began in 1999 when Temple Terrace declared its downtown blighted and set up a redevelopment agency to create a new vision for the area. The city signed an agreement in 2009 with Vlass Temple Terrace, headed by Michael Vlass, to build a $150 million project sprinkled with shops, restaurants, private residences, offices and civic and cultural buildings.
Vlass was the third developer to take up the project, and the city signed over the deed to 29 acres at Bullard Parkway and 56th Street for his company to develop.
The city has kicked in to build a new Main Street and add infrastructure, including water and sewer lines. But bickering over how to proceed with the second phase brought the entire project to a standstill.
The city is committed to doing retail construction on the first floor of the next phase of buildings and wants the developer to move forward with construction of a civic arts center. City council members agreed, after much debate, to allow apartments in the mix but want ample parking on-site for the cultural center and for retail. Vlass wants more spaces reserved for residents.
The council also wants the commercial retail units on the ground floor of three new buildings to have 16- to 20-foot ceilings, something the developer has tried unsuccessfully to negotiate down.
There also has been disagreement over how much retail space should be built at a time when retail is not leasing well. Vlass told the city council it would be foolish to move forward with the retail without committed tenants.
Attorney David Smith, who represents Vlass, said his client offered several alternatives, including leaving some of the space vacant or converting it to residential until the retail market turns around. But the city wouldn’t go for it.
Smith said the city worried it would become federally subsidized low-income housing. “That would not be the case,” he said.
City Attorney Mark Connolly provided a different account.
Connolly said the city asked for details of the proposed luxury apartments and Vlass Temple Terrace never provided them. Another issue is the developer’s insistence on moving forward with an apartment complex before building the city’s arts center, which should already have been finished, he said.
“There was no one issue,” Connolly said. “There are a lot of issues I was hopeful we could reach agreement on.”
The combination of disagreements led the city to file suit against Vlass Temple Terrace on Feb. 7. Then, last week, Vlass filed its counter-claim.
Connolly said he is in the process of preparing a response to that counter-claim, which must be filed in court by March 19.
Smith said his client has asked that the case be moved to federal court since Vlass Temple Terrace is a Georgia-based company. He said he fully expects that to happen. The request for arbitration is meant to help settle the case with minimum time and expense, he said.