Real Estate Notes
Tivoli files second lawsuit against builder Turner
Atlanta Business Chronicle - by Douglas Sams Staff Writer
An Atlanta-based condominium developer is now battling legal issues on two of its Atlanta projects.
Mezzo Development LLC, a division of Tivoli Properties Inc., filed a lawsuit Nov. 12 in U.S. District Court in Atlanta against Turner Construction Co., the builder of Tivoli’s Mezzo. The 94-unit, 20-story condo tower at 2171 Peachtree Road in Buckhead was recently converted to luxury apartments.
Tivoli also plans to build the Mandarin Oriental hotel.
It’s the second legal squabble between Tivoli and Turner to erupt in the past six weeks.
As reported in Atlanta Business Chronicle Nov. 7, Aqua Development L.P., also an affiliate of Tivoli, filed a lawsuit Sept. 29 in Fulton Superior Court against Turner Construction over Aqua, a 25-story, 84-unit condo tower at West Peachtree and 10th streets in Midtown.
In the latest suit, Mezzo Development alleges Turner failed to build the condo tower in accordance with standard construction practices, failed to complete most of the building by April 3 and failed to pay subcontractors, which resulted in liens being filed against Mezzo Development, the suit says.
Mezzo alleges Turner is using subcontractors “as pawns to exert pressure on Mezzo and to extort Mezzo to release [Turner] from liquidated damages” of $724,000 for failing to substantially complete the building by April 3, the suit says.
A search of state lien records found six contractors have filed nearly $435,000 worth of liens against Mezzo Development since October.
Mezzo Development also alleges Turner Construction itself has filed liens against the project, duplicating the subcontractor liens, the suit says.
Aqua Development’s suit alleges breach of contract and fiduciary duty, negligence of construction and slander of title. It also claims Turner Construction failed to construct the condo tower in compliance with their agreement and failed to pay subcontractors. As a result, the lawsuit claims, several subcontractors filed liens against the property. In April, Turner Construction also filed a more than $1 million lien against Aqua.
In a statement, Turner Construction said it fulfilled its obligations under its contract with Mezzo Development but was not fully paid for the work, so it filed a lien on the project “to preserve the rights of the company and its subcontractors.” Turner said Mezzo’s allegations are without merit.
Pelt Promoted. Peter Pelt has been named vice president of tenant relations for all of Miami-based Equity One Inc.
Pelt, who will remain in Atlanta, is now responsible for calling on national and retail tenants who are in Equity One (NYSE: EQY) centers, he said.
“That could be anyone from Great Clips to Wal-Mart and everyone in between,” said Pelt, who will also retain some of his development duties with the real estate investment trust.
Pelt will also “see if there are retailers that should be in some of our centers, based on demographics [of the area].”
Pelt has been with Equity One and its predecessor company, IRT Property Co., for eight years. Equity One owns 23 retail centers in metro Atlanta.
Overcoming debt markets.
M.D. Hodges recently secured a $53.9 million loan to refinance eight properties within its portfolio, totaling slightly more than 2 million square feet.
The portfolio is made up of one office building and seven industrial buildings, including two that are not leased.
The financing was provided by Prudential Mortgage Capital Co. Kevin Troy, senior vice president of CB Richard Ellis Inc.’s capital markets group in Atlanta, secured financing on behalf of M.D. Hodges.
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