PHA, Developer in Court Over Density of E. Falls Site
By Larry Eichel, The Philadelphia Inquirer, The Philadelphia Inquirer
Dec. 22–Nearly a year after it was announced, a deal to build new market-rate homes right next to new public housing in East Falls has yet to be finalized and is now mired in litigation.
Last January, the Philadelphia Housing Authority said it was selling part of the site of the old Schuylkill Falls project to Westrum Development Co. for private housing.
PHA Executive Director Carl R. Greene termed the arrangement “historic and unique,” because the Westrum homes would be side by side with the authority’s new, suburban-style Falls Ridge development.
The sticking point is the number of units that Westrum will be allowed to build on the hilltop site overlooking Kelly Drive. The Housing Authority says the agreed-upon limit is 92 (or thereabouts); the developer proposes more than 300.
Based on that dispute, PHA sent Westrum a letter on Nov. 28 terminating the original agreement of sale. It also filed a lawsuit in Common Pleas Court alleging that the proposal to build so many units amounted to breach of contract.
Westrum replied on Dec. 14 with its own lawsuit, claiming that PHA’s termination notice was a contract breach.
PHA spokesman Kirk Dorn characterized the legal moves as “a negotiating process that is being done in the courts. We’re hoping to work this out.”
Indeed, Westrum’s lawsuit is not framed as an attempt to back out of the deal; it asks the court to order PHA to complete the project. And the two principals in the dispute, Greene and John Westrum, were said to be talking yesterday in an attempt to work things out.
Local civic leaders, who have long fought for a mixed-income use of the site, also have concerns about how many units there should be. But they are tired of all the delays.
“We want something built,” said attorney Meg Greenfield, vice president of the East Falls Community Council, adding that PHA and Westrum had not kept the neighborhood informed about these maneuvers.
Plans to redevelop the area have been in process for nearly a decade; the two old high-rises at Schuylkill Falls, vacant since 1976, were demolished in 1996. And the public-housing portion of the site, Falls Ridge, now has 135 new rental units on it.
But development of the remaining ground was blocked for several years, the result of lawsuits filed by the community council to force PHA and the U.S. Department of Housing and Urban Development to build market-rate housing.
As part of an out-of-court settlement last year, HUD gave PHA the go-ahead to sell 16.7 acres to a private builder.
The letter of permission from HUD, dated Dec. 20, 2004, said that the development would consist of “approximately 92″ homes and that the land would sell for $2.8 million “or higher.”
On Jan. 7, 2005, PHA agreed to sell the land to Westrum for $2.8 million.
This fall, Westrum sent the community council drawings calling for 318 units. Those drawings got the Housing Authority’s attention and eventually led to the termination notice.
PHA contends that Westrum knew of the building limit — the agreement of sale speaks of “92 separate building lots” — and that the sale price would have been higher had more units been permitted.
Westrum, in its lawsuit, noted that the agreement of sale “does not contain any restriction as to the number of units Westrum may build at the property.”
John Westrum could not be reached for comment.
Contact staff writer Larry Eichel at 215-854-2415 or leichel@phillynews.com.
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