It looks like Taubman Centers Inc. will be paying out $34 million for delaying for a year a rival developer's effort to build a shopping mall in West Hartford, Connecticut.
The Hartford Courant says that Michigan-based Taubman agreed to pay all these millions to settle a lawsuit filed after it organized and bankrolled citizen legal challenges to the construction of a new mall in West Hartford's downtown, a few miles from one of its own malls.
Taubman, which owns Sunvalley shopping mall in Concord, organized and bankrolled citizen legal challenges and a political campaign aimed to stop retail rival Macerich, which owns Broadway Plaza, from bringing a new Neiman Marcus to downtown Walnut Creek. Taubman also hoped to bring a Neiman Marcus to San Ramon's long-planned city center. Neiman Marcus had shown interest in San Ramon, but, in the end, chose Walnut Creek instead.
In the West Hartford case, the Hartford Courant says that Taubman, "the parent company of Westfarms mall paid $34 million to the developers of Blue Back Square [in downtown West Hartford], compensation for a protracted legal battle that delayed the opening of the retail-residential complex by a year."
The story goes on to say:
The payment ... ends a lawsuit filed in 2007 by developers of the Blue Back retail-residential complex. The suit sought damages for, among other things, lost revenue, higher financing costs and increased construction expenses.
The lawsuit claimed that Taubman organized and bankrolled citizen legal challenges to Blue Back in hopes of preventing the retail rival from being built a few miles from Westfarms.
Blue Back opened in the fall of 2007, a year later than first scheduled. The opening coincided with the onset of a severe economic recession.
And another potential worry for Taubman?
A similar lawsuit filed against Taubman by the town is pending. Town officials allege that the delay resulting from Taubman-financed opposition added to the town's portion of the cost of Blue Back and resulted in lost tax revenue. The town is seeking $4.5 million in damages.Walnut Creek voters in November overwhelmingly approved Measure I, an initiative which will allow Broadway Plaza to build a new 92,000-square-foot department store at the corner of South Main Street and Mt. Diablo Boulevard. Neiman Marcus said it intends to occupy that spot.
It was a costly battle for Macerich and Taubman--and the City of Walnut Creek. Macerich spent around $1.3 million on the Yes on I campaign, while Taubman Centers spent $700,000. The city had to fork out money for the special election, plus the staff costs and time associated with addressing the legal challenges.