Jersey City Settles Lawsuit With the 6th Street Embankment Purchaser, Intends To Make Land Part Of Larger Downtown Park Pending Council ApprovalBy Matt Hunger • Feb 6th, 2012 • Category: Featured, News
Nine months after Jersey City rejected an initial “preposterous” settlement with developer Steve Hyman, owner of the 6th Street Embankment, an agreement was reached Friday that will transfer the valuable downtown land to the city for $7 million, pending Council approval.
The settlement comes after a 7-year legal battle that has accrued millions of dollars in fees and that could have extended for many months, if not years, following a successful appeal by the city to sue over the initial sale of the land. Hyman, who months early had rejected a plan to sell the land for slightly more money, changed his mind after the U.S. Court of Appeals’ overturned a lower court’s ruling that had prevented the city from suing over the land’s sale. In the suit, the city maintained the sale was illegal because Conrail, the previous owners, had never acquired approval from the Surface Transportation Board, a requirement for selling land that contains rail lines such as the Embankment. The decision to overturn the suit puts the sale of the land in question, and Hyman could have potentially lost out on his significant investment if the court were to ultimately strike the deal.
“The City not only stands to gain a world class park that is equal to or better than New York’s Highline, but also development that will complement the park and provide the City with substantial property tax revenues,” said Mayor Healy.
Initially purchased for approximately $2.5 million in 2005, Hyman intended to construct 1,800 residential units in the fastest growing area of Jersey City, but the city, joined by downtown activists, fought the plan. Instead the land will be transferred to Jersey City for the sum of $7 million and will be used as a “linchpin” connecting different parts of the city through the park. Both prices are seen as well under market-value for the property.
Hyman’s lawyer, Dan Horgan, says the city had at first looked favorably on the developer’s plans but ultimately decided to pursue a park, a decision Hyman had criticized as ignoring the much-needed revenue the development of residential units would provide.
Despite losing out on what would have likely been a big return on his investment, Horgan maintains everyone, including his client, “wins.”
“My client is satisfied it’s over, and no one is going to look at [the settlement] and think the city missed an opportunity,” said Hyman over the city’s purchase of the land. The city’s plan for the Embankment will make it part of a downtown park that “bridges the Hudson Waterfront Walkway with the Hackensack Meadowlands, via the Bergen Arches,” according to the Embankment Coalition, a group that formed to fight the “overdevelopment” that would result from the developer’s plans.
“The city,” adds Horgan, “is getting everything that [they] said [they] wanted along the way and more.” Without the settlement, the park might “not have happened.”
Along with $7 million, which Horgan calls “fair return,” the Hymans get closure on a frustrating development plan.
Ward E Councilman Steve Fulop, whose ward encompasses the Embankment, said, “It’s a positive for sure as this provides an opportunity for a world class park which we have fought for over the years, long term public transportation options, and eliminates any more tax payer funded lawsuits.”
The $7 million, however, is $600,000 less than the city’s initial offer for the land, which Hyman rejected. In turn, he offered a settlement to sell only two of the six parcels of land for $10 million. The city in turn rejected this offer, which they called “preposterous,” back in May. At the time, City Spokeswoman Jennifer Morrill said, “We will continue to fight for the preservation of the Embankment for the creation of a world-class elevated park and a transportation corridor, while remaining open to any reasonable settlement proposals.
The fight for the Embankment’s future, however, dates back to 1998, when the Embankment Preservation Coalition, the group that first envisioned a park in the historic rail yards, began its 14-year effort to help save a piece of Jersey City’s history — and downtown — from over-development.
“We’re hopeful the city council approves the settlement because we think it’s a compromise in the best interest of everyone,” said Stephen Gucciardo, the president of the EPC.
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