By Lev D. Zilbermints
As was reported in the June 1, May 11, April 20, April 14 and March 23, 2023 issues of “Local Talk”: the City of Newark, its Municipal Council and certain other parties were sued by the developer, Fairmount Senior Genesis, Housing Urban Renewal Partnership, LLC, Genesis Fairmount Partners, LLC and Genesis Central Ave Partners. The cause of the lawsuit was that the City and its Municipal Council allegedly failed to live up to their side of the agreement and were engaged in unfair play and political shenanigans.
In this, the fifth part of the article, “Local Talk” sheds more light on what happened.
Negotiations Start Again for the Revised Project
According to court papers, once the developer and the City agreed to a Stipulation of Dismissal Without Prejudice, negotiations began again. Apparently both parties wanted to get something going, so negotiations resumed. Why was the developer again trying for something with a partner that could not be trusted? Perhaps the developer thought of salvaging something from a project that had taken so much time, effort, money and resources.
According to court papers, “The City thereafter approached Plaintiffs and requested that Plaintiffs provide a ‘concept plan’ for a development project which encompassed the Central Properties and certain surrounding parcels that neither the City nor Plaintiffs owned or controlled.
“The City’s stated intention for this revised project was to fulfill the City’s desire for a ‘legacy project’ with the Central Properties, and the City indicated that it would negotiate acquisition of the necessary surrounding parcels directly.”
This means that now the strategy has changed. The developer was asked to work with the City on land that did not belong to either party. In other words, it was neutral territory. Fair enough, one might say. However, since the City of Newark expressed interest, there is something to watch out for. Caveat emptor, or “let the buyer beware,” goes the old saying.
Kawaida Towers is what City of Newark wants to bring back
According to court papers, “Upon information and belief, the revised project is the resurrection of ‘Kawaida Towers,’ a low- and medium-income housing project that was first introduced in the early 1970s by Mayor Baraka’s late father, Amiri Baraka, and ‘has been 50 years in the making.’
“Upon information and belief, the original Kawaida Towers project was slated to be built as a 16-story building on Lincoln Avenue in the North Ward of Newark, but it was never completed due to protests, protracted litigation, and political push-back. Decades later, Mayor Baraka seeks to finally bring his father’s dream back to life regardless of the cost to the City and its residents.”
Here we see why the City still needed the developer. This was the personal interest of Mayor Ras Baraka, who wanted to finally build the much-delayed Kawaida Towers.
What happened to Kawaida Towers in the 1970s?
Research by “Local Talk” found a 1976 New York Times article that gave the entire history of the Kawaida Towers project. Just as the lawsuit said, there were protests, protracted litigation, political push-back. There also was racism, something that the lawsuit failed to mention.
According to a July 16, 1976 New York Times article, “But the racial issue, fueled at several neighborhood meetings called by Mr. (Anthony) Imperiale, soon became the dominant issue. Mr. Baraka, the poet and playwright previously known as LeRoi Jones, was described at the rallies as a racist and accused of espousing an “alien philosophy.”
The same article states, “More than 350 demonstrators began forming picket lines each day at the construction site and were successful in stopping work begun by B.J. Builders Inc., the general contractor.”
In the end, the original Kawaida Towers just could not be built. Per the 1976 article, “a sharp rise in construction costs prompted Mr. (Amiri) Baraka’s organization to try scale down the project and build it within existing mortgage commitments. The State Housing Financing Agency paid $50,000 to have the redesign work done, but refused to authorize a further commitment for construction.”
Situation with Kawaida Towers in 2018
According to court papers, after the developer “produced the requested concept plan, the City however, was ultimately unable to secure any of the surrounding properties required to create a footprint large enough for the Kawaida Towers project to materialize.”
So, the developer honorably comes up with what is asked of them, but the City fails to do their part. Now why would that be? That is a question that needs to be answered.
Court papers show the protracted fight to get the project off the ground. The City comes up with yet another method. This time the City wants the developer to start negotiations with another redeveloper that the City chose.
Maneuvering by the City
According to court papers, “following the City’s failure to secure adjacent properties sufficient to construct the Kawaida Towers project, the City again approached Plaintiffs and requested Plaintiffs initiate negotiations with another redeveloper, ABC Corporate Entity 1 (the “Proposed Replacement Redeveloper”), which had purportedly been selected by the City and Mayor Baraka, to transfer Plaintiffs’ redeveloper designation of all the Central Properties and Fairmount Properties.”
The question begs to be asked, why is the developer, aka Plaintiff, still doing business with the City? Are they so naïve as to not see that the City has no intention of playing by the rules of business and legal niceties?
According to court papers, “Notwithstanding their rights under the Redevelopment Agreement, Plaintiffs began good faith negotiations with the Proposed Replacement Redeveloper, which negotiations culminated in an agreed upon form of Purchase and Sale and Assignment and Assumption Agreement, and on or about February 27, 2019, Plaintiffs submitted a letter to the City requesting approval of the transfer of the redevelopment rights and form of the Purchase and Sale and Assignment and Assumption Agreement.”
Everything appears to be going on just fine. At this point, the City shows why it is a not a real partner.
According to court papers, “Instead of issuing an approval, however, the City sent Plaintiffs a letter, dated November 27, 2019, alleging that Plaintiffs had defaulted in their obligations as the redeveloper of the Central Properties site (the Central Default Notice”).
Exactly how did the developer default? From the court papers, it seems like the developer was doing everything according to the rules. The City, however, appears to be trying to avoid playing by the rules.
Developer responds
According to court papers, “On January 16, 2020, Plaintiffs responded to the City’s Central Default Notice to reiterate that, because of the City’s failure to abide its obligation to furnish the Relocation Notice, Plaintiffs were not able to proceed with the redevelopment of the Central Properties. …
“The City, however, ignored its own failures and, on January 29, 2020, issued Plaintiffs a second letter, which purported to terminate the Amended RDA to the Central Properties (the “Central Termination Notice”). …
“Also on January 29, 2020, the City issued Plaintiffs a letter alleging that Plaintiffs had defaulted in their obligations as the redeveloper of the Fairmount Properties (the “Fairmount Default Notice”).”
Next time: Developer Initiates Lawsuit Against City of Newark
