Developer appealing Lebanon’s decision to torpedo Prospect Hills housing project

Valley News Staff Writer
Published: 5/15/2021 10:58:21 PM
Modified: 5/15/2021 10:58:26 PM

LEBANON — A Manchester development firm is using a new avenue in its appeal of the city’s decision to effectively kill a 117-unit housing project near Lebanon Middle School, saying the proposal was met with “hostility and dislike” by officials.

Brady Sullivan argues the Lebanon Planning Board acted unfairly when it voted unanimously in March to deny the Prospect Hills subdivision an extension needed to start work on its second phase.

At the time, officials said they’d allowed the developer enough leeway. The second phase — a mix of single-family homes and townhouse-style units on a 40-acre wooded parcel off Prospect Street — was first proposed 15 years ago, and the Planning Board issued renewals in 2016 and 2018.

Brady Sullivan argues it would have met those goals had the COVID-19 pandemic not interfered with the company’s work. In its appeal, the company says it planned to begin construction in the spring of 2020 but was delayed.

The Planning Board’s decision effectively throws out millions of dollars already spent in engineering and off-site work, according to Brady Sullivan attorney John Cronin.

“The ability to build out this season when conditions are favorable is now lost,” he wrote, later adding, “Building costs are exploding by the day, interest rates are increasing and political leaders are warning of substantial tax increases.”

Unlike most land use cases, the appeal won’t be heard in Superior Court but rather by the New Hampshire Housing Appeals Board, a new entity specifically designed to settle land disputes.

The board was created by the Legislature last year as an alternative to the court system, where criminal cases take precedence and land use appeals sometimes take years to resolve. It is scheduled to hear the Prospect Hills appeal on June 30.

Brady Sullivan is asking the board to reverse the Lebanon Planning Board’s decision and award the developer “costs, expenses and reasonable attorney’s fees.”

The case largely hinges on whether the Prospect Hills subdivision gained “vested” rights before the city declined the extension. Vesting occurs when a developer completes “substantial construction” on a project or has made “substantial liabilities,” the New Hampshire Supreme Court has ruled.

Brady Sullivan’s appeal argues it met that standard because the developer made a “substantial investment” in the project, expecting to make money once homes were later sold.

However, the city says Brady Sullivan never actually started groundwork on the second phase and, as of September, was still attempting to wrap up the first — 54 homes around Mountain View Drive. Money spent on that initial project shouldn’t count toward the second, wrote Lebanon’s attorney, Christine Fillmore.

She went on to say that Brady Sullivan’s appeal doesn’t explain how the developer was treated with “hostility and dislike.” If anything, she said, city staff gave Brady Sullivan more help than a company with properties throughout New Hampshire should need.

Had the firm intended to start building this year, Fillmore said, “they would have filed the extension request well in advance of the 12/10/2020 rather than more than a month afterward.”

Lebanon Planning Director David Brooks declined on Friday to comment on the case further, and a message left with Cronin’s office was not returned.

The Prospect Hills project started in 2005 with Lebanon natives Erik and Treff Moulton’s plans to build and sell homes at the site. Their company, M&M Equities, began work on the first phase until the project fell on tough financial times during the Great Recession.

The Moultons filed for bankruptcy by the summer of 2009 with only six homes complete. The mortgage deeds were sold a year later to Brady Sullivan, which changed the development’s scope to houses in the $180,000 to $255,000 price range.

Single-family homes in the project’s first phase have sold for about $315,000 in recent years, though one is currently on the market listed at $425,000.

Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.




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