In court, claim rules were onerous; Cape says rules are rules.
By Thomas Stewart The News Press
tstewart@news-press.com
The owners of an abandoned 175-acre golf course in Cape Coral who are suing the
city argued in court Tuesday the city abused its own processes in an effort to force the owners to default on their loan so the city
could snag the property.
“The evidence will show the city was hoping to
acquire (it) in bad faith at fire sale prices,” said Michael Ciccarone, a lawyer
for the owners of the 18-hole course on Palm Tree Boulevard.
The suit was
filed in 2009. The trial began Tuesday and is expected to conclude April
16.
After both parties present their cases, Circuit Judge Michael McHugh will issue a ruling. There is no deadline for his
ruling.
The owners have long argued the city effectively condemned the
property through restrictive regulations that prevented development.
On
Tuesday, Ciccarone said the city blocked an attempt to change the future
land-use designation from parks and
recreation to mixed-use, which would have allowed the
construction of 100,000-square-feet of shops, 300,000-square-feet of office
space and about 800 homes.
He said the property
was no longer viable as a golf course, demonstrated by the failure of the former
owners, who bought the property in 2001 and lost money every year until 2006,
when the course was shuttered.
Scott Siler, who
managed the property and still has a $375,000 stake, took the stand and
explained how 50 investors paid $4.3 million for the course and borrowed another
$4 million for renovations. Siler said the annual taxable losses ranged from
$1.7 million in 2002 to $768,000 in 2005. In 2006, the same investors agreed to
split ownership of the property with Minnesota-based Ryan Companies US in
exchange for a $9 million loan to pay off their debts and other expenses.
Clay Crevasse, a lawyer representing the city,
pointed out the land use and regulations were already in place when the property
was purchased.
Crevasse said the city denied
the land-use change because it could have allowed industrial projects and other
ventures incompatible with surrounding residential neighborhoods.
“This property owner bought at the height of
the market and, within two years, the bottom had fallen out,” he said. “It is
not the obligation of the city to approve a plan that provides no benefit to the
public.”
And, he said, the owners failed to
apply for other potential land uses, such as residential, which the city likely
would have approved and could have proved profitable. Ciccarone presented
testimony that the city’s own policies indicated it felt it had enough
residential property already. But he has said the owners no longer seek a
land-use change and that the city wants to buy the property but has not yet
offered enough money.
He said the two parties
are millions apart in their opinion of the property’s value, but he declined to
say how much they want.
On Tuesday, Pat Ryan,
president of Ryan Companies US, testified the company has invested about $19
million in the property and revealed the company thought it could be worth $25
million-$30 million with the desired land use.
Clay Crevasse, a lawyer
representing Cape Coral, cross-examines a witness Tuesday in a dispute over an
abandoned golf course. GUY TUBBS/THE NEWS-PRESS
“It is not the obligation of the city to approve a plan that
provides no benefit to the public.”
CLAY CREVASSE, lawyer representing Cape Coral
