Lawsuit Derails Redevelopment Plans for 75 Acres of Norcross Fiber-Optics Plant

Local business leaders had touted the project as a linchpin for renewing the Jimmy Carter Boulevard corridor, but the departure of the developer, Preferred Real Estate Investments Inc., has left the $200 million to $300 million redevelopment project in limbo. The market study by the Gwinnett Village Community Improvement District highlighted the potential of the area, noting that the OFS redevelopment could change the residential nature of the area.

Key Takeaways:

• OFS Brightwave filed a breach of contract lawsuit against Preferred Real Estate Investments Inc. over a failed $4.5 million escrow payment for a 75-acre redevelopment project.
• The project, which had been valued at $200 million to $300 million, included plans for a 405-room hotel, shops, offices, and over 1,000 residences.
• OFS claims that Preferred Real Estate failed to make the escrow payment by a June 13 deadline, incurring about $4.75 million in costs for the company.
• OFS is seeking $9.75 million in damages, plus interest, court and legal costs.
• The Gwinnett County Department of Planning and Development agreed to postpone OFS's rezoning request until a new buyer can be found.
• OFS still plans to sell the property for redevelopment, despite the delay, citing "a lot of interest" from potential buyers.

Statistics:

• The redevelopment project had a proposed budget of $200 million to $300 million.
• The property in question is 75 acres large, with OFS owning 169 acres.
• OFS claims it incurred about $4.75 million in costs due to Preferred Real Estate's failure to make the escrow payment.
• OFS is seeking $9.75 million in damages, plus interest, court and legal costs.
• Preferred Real Estate made an initial deposit of $500,000 in an escrow account in March.

Sources:

• Gwinnett Daily Post, June 20, 2006
• Gwinnett Village Community Improvement District, Market Study
• OFS Brightwave lawsuit filed at Gwinnett Superior Court