A DeKalb County jury has ordered Brookhaven to pay millions of dollars for a botched development deal.
On March 7, a jury found that the city purposefully obstructed the progress of a redevelopment project along Buford Highway and ordered the city to pay an estimated $6 million to a real estate investment firm and two homeowners, according to the AJC. Brookhaven Mayor John Ernst and City Manager Christian Sigman were also ordered to pay $200,000 each in punitive damages, according to the newspaper.
City spokesperson Burke Brennan said the city is considering whether or not to appeal the verdict.
“The City of Brookhaven appreciates the court and the jury for its service, but disagrees with the verdict,” he said in an email.
In 2017, the Atlanta-based real estate firm Ardent Companies was planning a buyout of a neighborhood on Bramblewood Drive in order to redevelop the area into a gated townhome community. However, negotiations over the deal fell apart in 2018 over affordable housing, tax breaks, and what Ardent has alleged was a purposeful attempt by the city to kill the project.
According to DeKalb County Judicial Information System’s website, the lawsuit was filed in late 2018. In that lawsuit, Ardent Companies states that it successfully negotiated purchase contracts with Jon and Courtney Wheeler, who are also named as plaintiffs in the case, and other homeowners on Bramblewood Drive, before coming to the city with its project request. Ardent filed applications in late 2017 to rezone the property and also asked the city to abandon two acres of city-owned right of way on Bramblewood Drive for the project.
The lawsuit then alleges that the city had interest in acquiring some of the land for a future public safety headquarters, and moved to acquire some of the property when it was supposed to be reviewing Ardent’s applications, which Ardent alleges is a conflict of interest. The city later ended up selecting a site on Briarwood Road for its public safety building.
At a Brookhaven City Council meeting in June of 2018, the council requested that the project be more of a mixed-use development with retail and affordable housing. When the agreement later fell through that year, Mayor John Ernst stated that part of the reason was due to the inability of the city and Ardent to agree on the definition of affordable housing.
“We could not come to an agreement as to the area median income (AMI) that would be the threshold for ‘affordable.’ Ardent Companies wanted to use an Atlanta region AMI of $68,000 and the City wanted to use the average AMI for the census tracks around Bramblewood Drive at ~$50,000,” Ernst said in a 2018 press release. “An AMI of $68,000 would essentially be out of reach for many living on Buford Highway, our City employees, or teachers serving local schools.”
Ardent alleges that the city required the company to revise its original project as part of a “property swap” for the two acres of right of way on Bramblewood Drive. In the lawsuit, the company cautions other developers from working with the city.
“Ardent’s experience with Brookhaven serves a cautionary tale to any developer trying to get in on Brookhaven’s hot redevelopment market,” reads the lawsuit. “Brookhaven will give a developer the governmental approval it needs, as long as the developer pays to play.”
Ardent’s lawsuit also alleges that the city violated a nondisclosure agreement by releasing more than 100 emails to Reporter Newspapers in an open records request, stating that the city shared “confidential and proprietary information.”
A representative for Ardent Companies did not respond to a request for comment in time for publication.