Three builders of luxury homes in Cascades, a huge planned community in Loudoun County that ran into financial difficulties last year, have filed lawsuits against the project's developers, claiming that they have failed to build golf courses, a swimming pool and other amenities that were promised.
The suits, filed last week in Loudoun County Circuit Court, are an illustration of the level of frustration among area home builders and developers, who have seen the demand for luxury homes fall far short of their expectations. The slump has resulted in unusually testy relations among various segments of the local real estate industry.
The suits were filed by A.G. Van Metre Construction Inc., Christopher Properties L.P. and Batal Builders Inc., which purchased a total of 147 lots from NVKettler L.P., the partnership owned by the original developer of Cascades.
The builders have each asked for $4 million in damages.
In September, the development firm of Kettler & Scott gave up its ownership in Cascades and several other planned communities in Northern Virginia after running into financial difficulties. Cascades now is owned by its lender, Chevy Chase Federal Savings Bank, although the thrift has retained Kettler & Scott to continue to develop the project.
The lawsuits claim that the builders bought lots for about $80,000 each in 1988 in the original Cascades project, which was designed to be an exclusive enclave slightly east of a lower-priced Kettler community called Potomac Lakes.
The builders said that, in exchange for paying higher prices for the lots in the luxury community, they were promised tennis courts, swimming pools and two golf courses. Those two projects, however, were combined into Cascades, and the higher-priced community was renamed Lowe's Island.
However, the builders said, while the former Potomac Lakes portion of Cascades now has a swimming pool, a luxurious clubhouse and tennis courts, none of those has been built on the Lowe's Island portion.
"We just want them to do the same thing on the other side," said Albert Van Metre, president of Van Metre. Neither of the two golf courses has been constructed.
Homeowners in Lowe's Island must drive out of their neighborhood, along Route 7 and into the former Potomac Lakes project to use the amenities. As a result, the builders said, sales have suffered.
Batal, for example, has sold only two houses on the 50 lots it bought from Kettler, according to the market research firm of Housing Data Reports. Christopher Cos. has sold four houses on the 56 lots it bought.
Prices of their houses start at about $320,000.
The builders' lawyer, Lawrence Bensignor, said the builders have been negotiating with Kettler and, since the project's takeover, with Chevy Chase Federal Savings Bank, but the talks have been "going nowhere."
Robert Kettler, president of Kettler & Scott, did not return phone calls and his lawyer, Debra Stencel, declined to comment on the suits. However, Kettler has said previously that work on a road connecting the two sides of Cascades is underway.
Home-building consultants and other builders said that, with sales of luxury homes in the doldrums throughout the Washington area, it is difficult to blame the lack of amenities in Lowe's Island for the anemic sales of its luxury homes.
"My clients ... know the risks they take. They're big boys," responded Bensignor, who said that nonetheless the builders believe that houses in Lowe's Island would be selling at a faster clip if the planned amenities were built.