The D.C. government has agreed to pay a prominent Georgetown developer $2.5 million to drop one lawsuit, and the threat of another, that he levied after claiming D.C. stiffed him on a pair of development opportunities.
Herb Miller, chairman and chief executive officer of Western Development Corp., sued the District for $140 million in November 2006 after D.C. pulled the plug on his ambitious plans to develop the site immediately adjacent to Nationals Park. The city quietly agreed to settle in May for $2 million.
“We totally inherited this and realized we didn’t want to be stuck in court forever, and just move on,” said Sean Madigan, spokesman for D.C.’s deputy mayor for planning and economic development. “These are prime sites and they’re going to generate tens of millions in revenue, and we didn’t want to stymie that by having it hung up in court.”
Mayor Adrian Fenty took office in January 2007. In a statement, Miller praised Fenty as a “positive force for development in the District.”
“We were willing to compromise because we wanted to put it behind us,” Western President Benjamin Miller said Monday, adding that half of the settlement will be donated to 43 different D.C. charities and nonprofits.
In the lawsuit, filed Nov. 13, 2006, Western alleged that its exclusive right to develop the ballpark site was yanked without cause. Western, the suit claimed, had invested $6 million in the project — though the developer sought $140 million in compensatory and punitive damages.
Miller’s plans for the ballpark site included 650 condominiums, office space and a 180-room hotel wrapped around 1,600 above- and below-ground parking spaces. The project was backed by a host of D.C. leaders, but Chief Financial Officer Natwar Gandhi refused to give his blessing, essentially killing it.
The District ended up paying more than $20 million for a pair of stadium garages.
In addition to the $2 million settlement, the District also has agreed to pay Western $500,000 to dissolve itslong-term ground lease on the Franklin School, a National Historic Landmark in the heart of downtown that currently houses homeless men. Miller, the developer of Gallery Place, signed the lease in 2005 with plans to turn the school into a hotel, but the city ended up scrapping the project.
Miller threatened to file a $100 million lawsuit over the school issue.
