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Thursday, June 20, 2024


Despite Ruling, Developer Hopeful to Build Multiple Units on Sixth Avenue


By Jack Fichter

WEST CAPE MAY — While Superior Court Judge William Nugent denied developers Sixth Street Partner’s request for a builder’s remedy lawsuit against the borough Jan. 6, their attorney told the Herald it may appeal the decision and it still expects it will construct a number units on the site.
The developers sought to construct 70 town houses on a 5.8-acre property on Sixth Avenue.
Mayor Pamela Kaithern told the Herald the judge ruled the site was unsuitable for 70 units. She said Nugent inspected the site in November.
Nicholas Menas, attorney for Sixth Street Partners, said they would appeal the decision. He told the Herald he had expected an appeal no matter which way Nugent had ruled either from the developer or borough.
He said the judge found that West Cape May was in violation of their constitutional obligation to provide affordable housing “for decades.”
Menas said the judge believed the site was suitable for “a development,” but 70 units “did not work for him.” He said the judge swept aside West Cape May’s defenses that the number of units was a bargaining chip, the developer acted in bad faith and had no intention of constructing 70 units.
Nugent will keep jurisdiction of the matter and work with a special master to determine what the end result will be.
Menas said the borough still needs to be certified by the state Council on Affordable Housing (COAH). He said there is no reason to think the Sixth Avenue parcel will not be developed but it will not be developed with 70 town homes, said Menas.
Despite a sour economy, Sixth Street Partners is still interested in developing the property, which it has not yet purchased.
Kaithern said the Sixth Avenue property is zoned R-5 and is outside the sewer service area, which requires 35,000 square foot lots, which would allow only seven units to be constructed under current zoning.
She called the denial of the builder’s remedy lawsuit a “landmark decision.” She said the judge said a 70-unit project was as out of place on Sixth Avenue as a 100-acre farm would be in New York City.
The judge recognized that sound planning and smart growth, taking into consideration the flavor of West Cape May, have a place in communities, said the mayor.
Sixth Street Partners made a motion for the borough cover their legal expenses, which exceeds $500,000 according to Menas but that has not been granted.
At the time of the lawsuit, West Cape May did not have an affordable housing plan approved by COAH. A part of the borough’s defense was that it had been actively pursuing becoming COAH compliant.
“You don’t go from point A to point D without doing B and C,” said Kaithern.
She said the borough had an out-of-date master plan that was totally redone which included a housing element.
At this point, another developer cannot bring about a builder’s remedy lawsuit because the borough has protection from the courts, which was obtained early in the lawsuit, said Kaithern. The court is retaining jurisdiction and not turning over the case over to COAH, she said.
Kaithern said one reason the 70-unit project was unsuitable is that directly west of the property is a 10-acre preserved farm and to the north and east is 38-acre active farm.
The opposite side of Sixth Avenue has single-family houses.
“There is nothing comparable to what was being proposed,” said Kaithern.
Menas said the while the developers are disappointed they cannot construct 70 units, “it was not a deal breaker or a killer.”
He said the borough has not shown any signs of wanting to negotiate the size of the project.
“I think were pretty confident that the borough just doesn’t want to talk and they don’t want to see any development on this property other than potentially the seven lots or maybe 12 lots they at one point agreed to and forgot they agreed to it,” said Menas.
He said the judge made a point that the water and sewer infrastructure was available. Prior to the litigation, the borough filed a request with the state for grant money to extend sewer service down Sixth Avenue.
“They were actually awarded the grant, then they refused the grant,” said Menas.
He said ultimately, the number of units allowed on the property may be decided by the judge and special master prior to the appeal. Menas said the borough made 12 pretrial motions, all of which were denied by the judge.
Last, April, Menas submitted a written proposal to the borough with two separate offers, one for about 28 units, the other for 31 units. He said one of the offers was accepted by the borough “only to have the borough to change their mind and say ‘we are not going to accept it.”
Menas said the borough said in court it did not want new affordable housing units constructed in West Cape May. He said the smaller unit proposal did not include any affordable housing units and the developer would make payments in lieu of construction to the borough.
Menas said the borough told the developers they would submit a counter offer last May but no offer has come in the past eight and a half months. He said the developer was considering 30 single-family homes, not town houses at that time.
“The judge has presented a roadmap given certain findings that he found for the next phase and there are several more phases,” said Menas.
He said the matter is not ripe for an appeal since the judge has not made a final determination. Menas said the judge would not make a final determination until he makes a determination on the borough’s affordable housing plan.
He said Sixth Street Partners did not have to appeal until the court makes a final judgment. He predicted the matter could drag on until 2010.

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