An Oakley-based developer that helped in engineering a deal to acquire the aging Millennium Hotel downtown so it can be redeveloped is suing the Port of Greater Cincinnati Development Authority over a $5 million development fee it says it is owed.
Vandercar LLC filed the lawsuit against The Port Feb. 24 in Hamilton County Common Pleas Court. The suit alleges that The Port breached a contract with the developer and negotiated in bad faith.
Officials with the Port have called the lawsuit frivolous.
Rob Smyjunas, Vandercar's owner, negotiated a purchase agreement for the Millennium with its former owner, a Singapore-based company owned by billionaire Kwek Leng Ben, in July last year. That agreement came after years of efforts by local officials to get the hotel's owners to either upgrade or sell the property.
Smyjunas then transferred the purchase contract to The Port in exchange for promises of two development fees: a $2.5 million payment when The Port acquired the property earlier in February for $36 million and another $5 million should The Port issue bonds to redevelop the property within a year or transferred the property to another entity.
The Port did the latter two steps Feb. 13, the lawsuit alleges, by issuing $53 million in bonds for property acquisition and demolition of the site and subsequently transferring it to the affiliated Hamilton County Land Reutilization Corporation.
Vandercar's lawsuit alleges the company has received the $2.5 million payment, but not the other promised $5 million payment stipulated by its contract with The Port triggered when The Port issued the bonds for demolition and transferred the property.
The lawsuit argues that The Port's own definition of redevelopment includes "abatement, remediation, demolition and site grading." The Port, however, has said it has not decided how it will redevelop the site and hasn't issued bonds for that purpose.
According to the lawsuit, Vandercar invoiced the port less than a week after it issued bonds for the $5 million payment and has not received a response.
Port officials have said they will fight the lawsuit.