Big Overtown project in limbo as developer countersues rival who claimed conspiracy
Developer Michael Swerdlow, claiming that competitor R. Donahue Peebles sued him over a massive Overtown redevelopment project as a tactic to block him from closing on the deal, has now countersued.
In his March 26 complaint, Peebles made a series of incendiary claims with little proof, contending that Swerdlow “conspired” with Miami Commissioner Keon Hardemon, a Hardemon relative and other city officials — none of them named parties in his complaint — to push him out of the project and hand it to Swerdlow.
Now, in a pair of related filings, attorneys for Swerdlow are calling his rival’s claims spurious and asking the court to expedite consideration of the case and issue a declaratory judgment. Swerdlow is asking a Miami-Dade Circuit Court judge to rule Peebles has no grounds to sue because deadlines to do so have passed.
Swerdlow contends that Peebles’ suit, filed just before he was to close on purchase of the land for the deal under a development agreement with the city’s Southwest Overtown/Park West Community Development Agency, was deliberately timed to jeopardize the project, which has been touted as a major step in the long-planned revitalization of the impoverished, historic neighborhood.
Peebles lost a deal to develop the project in 2016 when the CRA canceled his bid, saying he’d missed deadlines. The project was awarded to Swerdlow in a new round of competitive proposals. Commissioner Hardemon was chairman of the CRA board at the time.
Swerdlow says in his countersuit that he was unable to close on the property, known as Block 55, because the principal financier for the project walked away after Peebles sued — one business day before the scheduled closing, Swerdlow notes. The closing has not been rescheduled, the complaint says.
“Through their suit, Plaintiffs seek to frustrate Defendants’ ability to close on the Block 55 property — although they have no rights in or to that property — and further to stymie Defendants’ efforts to commence development of the Block 55 property,” Swerdlow’s counter-complaint says. “Thus, every day the Defendants are delayed from closing on Block 55 and commencing their development efforts causes significant economic and other damage not only to Defendants, but to the greater Miami community, and to the Overtown community in particular.”
The project in question has a tangled history. The Overtown CRA first awarded a competitive bid for the property to Peebles and a local partner, Barron Channer, in 2013. But after the CRA canceled his bid, it sought new proposals for the land. A proposal by Swerdlow for a mixed-use project that would include affordable senior housing, a Target and other big retailers won that second round.
In his suit, Peebles and his Overtown Gateway Partners claim Swerdlow secretly worked to block their development plans in a conspiracy with a group that included agency chairman Hardemon and the commissioner’s uncle, influential activist and consultant Billy Hardemon. The same group then conspired to award Swerdlow the new bid for Block 55, the suit claims. Both Hardemons have denied the allegations.
Peebles claims Swerdlow violated an agreement they had reached to bring him in on the project. In his response, Swerdlow denies violating the agreement, which he terminated. Swerdlow also notes the agreement laid out deadlines for any legal challenge that have long since passed, and alleges Peebles filed his suit “in bad faith.”
Glen Waldman, an attorney for Peebles, said his clients are “confident they have a strong case.” They are seeking $160 million in compensation for lost profits and damages.
“What happened here was just wrong on many levels and caused significant damage to not only those involved in the entity which sought to bring relief to the people of Overtown, but to the people of Overtown as well,” Waldman said, referring to Peebles’ original proposal.
Glen Waldman, an attorney for Peebles and his partners, said his clients “are confident they have a strong case.” They are seeking $160 million in compensation for lost profits and damages.
“What happened here was just wrong on many levels and caused significant damage to not only those involved in the entity which sought to bring relief to the people of Overtown, but to the people of Overtown as well,” Waldman said.
This story was originally published April 15, 2020 at 7:00 AM.