Major development sues Henderson over park construction

A major development is suing Henderson, claiming officials are trying to “strong-arm” the developer into agreeing to contract terms that benefit the city.

“This is the epitome of bad faith,” the complaint, filed last week in Clark County District Court, reads.

The lawsuit was filed on behalf of Union Village LLC, and stems from conflict between the city and developer over Union Village failing to meet a deadline for building a park.

Jeffrey Barr, a lawyer for Union Village, said the city is using the park dispute to renegotiate a deal they’ve already struck.

“The city doesn’t like their deal,” Barr said.

Among other things, Union Village, a mixed-use development that is home to Henderson Hospital, argues that it did not default on its agreement to build a park because the COVID-19 pandemic interfered with its ability to complete the project.

In an email Tuesday, Henderson spokeswoman Kathleen Richards said the city has been supportive of the development and recognizes its economic potential and community benefits. However, she said, the park portion of the project has not progressed as hoped despite multiple deadline extensions over a period of more than three years.

“While the City desires to reach a mutually acceptable resolution to get the project back on track and avoid a lawsuit, negotiations to date have not been successful,” she said. “The City’s overriding goal is to ensure the project is completed as soon as possible and that residents in the area receive the community benefits that the City bargained for under the agreement.”

Union Village began developing the land near U.S. Highway 95 and Galleria Drive in 2014, according to the lawsuit. In February 2016, the developer signed a contract with the city to build a park.

The developer later requested an extension on completing the park, according to a Henderson council agenda item. It did not meet the new deadline. The city again extended the deadline, this time to Dec. 31, 2020, but the park still was not built.

In a Jan. 6 letter, the city declared Union Village in default of the agreement, saying unless Union Village “takes steps immediately to commence construction of the park with a plan for accelerated construction completion” within 17 days of the letter, the city could withhold the release of maps, building permits, building inspections and certificates of occupancy.

On Jan. 22, the developer provided a plan for accelerated construction and began building the park in mid-February, according to the lawsuit.

On Feb. 10, the city refused to rescind the notice of default and sent a second letter demanding that Union Village agree to amendments to the park contract and a separate agreement for the development.

The city proposed scaling back an incentive that allows Union Village to collect tax revenue generated from the project.

In exchange for agreeing to the new terms, the city would not pursue remedies, including withholding maps, permits, inspections and certificates of occupancy, the complaint states.

Union Village did not agree to the terms, and last month the City Council imposed a limited hold on building permits for the development.

Contact Blake Apgar at bapgar@reviewjournal.com or 702-387-5298. Follow @blakeapgar on Twitter.