Two years ago, 21 homeowners in Arlington's Courtlands neighborhood agreed to sell their houses as a group to a developer for about $14 million. Today, the matter seems headed toward court.
The homeowners hoped to capitalize on the high-rise development boom in the Court House Metrorail stop area nearby and maximize their profit by selling as a group, rather than as individuals.
The deal collapsed last December when the developer's financing fell through. The developer then offered to pay for the properties in installments rather than in a lump sum, but the homeowners could not agree on the offer.
In the past few months five lawsuits have been filed by homeowners alleging breach of contract. The suits seek to have the contracts nullified by the courts and ask for the deposits to be put in escrow by the developer.
Named as defendants were developer Robert M. Stein and Merrill Lynch Realty, which acted as the broker for the homeowners and holds about $400,000 in escrow funds.
"There was a deal struck. These people were promised and promised," said Michael J. Hage, an attorney who represents owners of three of the properties. "There's been a failure here."
Stein said he and his partners are still trying to arrange a deal so they can build a $190 million hotel and residential complex on land bordered by North Wayne, Veitch and 14th streets and the Quality Inn.
"We are now trying to enter into a more reasonable arrangement with the homeowners that will allow the project to go through," he said. Some homeowners have agreed in writing to a revised offer, he said. Others "have chosen not to be reasonable," he said. Stein declined to give details of the revised purchase offer.
Stein said the lawsuits will "tie up the property for several years in litigation." The suits "don't really accomplish what any of us want."
Hage said the patience of his clients has worn thin. "They wouldn't have sued if they felt it could have been resolved" otherwise, he said. "They signed a contract in April 1985. They wanted to settle," he said. "Nobody wants to litigate. It's very expensive." -- Evelyn Hsu