For the third time in four years, developer AvalonBay is taking the town of Princeton to court regarding the Witherspoon Street apartment project.
AvalonBay contends that Prineton has reneged on its contract with the developer to limit the affordable housing deed restrictions for the development to 30 years.
In the developer’s agreement drafted by the town’s lawyer and signed by the town and AvalonBay last year, both parties agreed to a 30-year deed restriction for the 56 affordable housing units that will be part of the 280-apartment project.
Under the affordable housing ordinance for the former Princeton Borough, new rental housing was required to be affordable housing for 30 years also.
In recent months, the town has demanded that the deed restriction for the affordable units state that the affordable housing restrictions can stay in place for 30 years or longer, if the town so chooses, allowing the town to possibly extend the number of years at its discretion.
AvalonBay refused, citing the existing developer’s agreement and the Princeton Borough regulations.
At the end of April, the lawyer for the town told AvalonBay in a letter that no building permits would be issued unless AvalonBay agreed to the deed restrictions of “at least” 30 years or more.
In order to keep the project moving, AvalonBay submitted the deed restriction “under protest and duress” and said the company reserved the right to legally challenge the deed restriction.
AvalonBay argues in the lawsuit that there has been no urgent need to delay the project because construction will take 18 months to complete.
“Princeton’s insistence that dispute be resolved immediately is not based on any legitimate project-related concern,” reads the lawsuit.
In a May 5 letter, the attorney for the planning board said the signed deed restriction was a condition of the planning board’s approval, and thus permits could not be issued until the deed restriction was signed.
Footings and foundation permits have since been issued for AvalonBay, but no other building permits have been issued yet.
AvalonBay argues that the town is being arbitrary, capricious and unreasonable in its demands. The changes, the company argues, would cost AvalonBay millions of dollars in future rent.
According to correspondence included in the lawsuit, the town contends that the state’s Uniform Housing Affordability Control regulations supercede any town ordinance or contract with AvalonBay and allow the town to include the language “at least 30 years” in the deed and extend the number of years for the affordable unit deed restrictions. The Princeton Planning Board’s approval of the project was subject to Uniform Housing Affordability Control regulations.
It is unclear why the town did not include that wording in the developer’s agreement contract that was signed by the town and AvalonBay.
Mayor Liz Lempert, the Princeton Council, the town, and the Princeton Planning Board are named in the lawsuit. AvalonBay is seeking a judgment against the town, attorney fees, and court costs.