Nov '23

After JCPenney's eminent domain appeal, what's next for the … – The Business Journals

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It’s been nearly a year and a half since the Town of Amherst designated the Boulevard Mall property an urban renewal area, opening the doors to the eminent domain process. But the town has yet to take over the mall site.
In 2019, developer Douglas Jemal paid a little over $30 million to buy the 65-acre shopping center. But as legacy leases at the site tied up the developer’s abilities to move forward, the town opted to use eminent domain, which allows a municipality to take private property for public use.
The latest delay: JCPenney recently filing a notice of appeal after the court ruled last month against its petition seeking the court to reject Amherst taking over its property. Penney Property Sub Holdings LLC, which owns the 2.3 acres of retail space where JCPenney operates and associated parking space, filed the petition in March.
While the town said in a statement that it was expecting JCPenney to try to appeal the court decision, this puts official negotiations with developers as part of the eminent domain process on hold.
The next step is for JCPenney to file its appeal, which could take up to 30 days or longer after the filing of the notice of appeal, and then for the town to file a response.
Mark McNamara, chair of Barclay Damon LLP’s property tax and condemnation practice area, told Business First that, in general, it’s not uncommon for parties to legally challenge the Eminent Domain Procedure Law process but “they’re pretty expensive, so they’re not routine.”
Prior to the appeal’s being filed, Amherst Supervisor Brian Kulpa said he hoped to have negotiations complete with current mall property owners Jemal and Benderson Development by January and officially, legally take over the site in April of next year.
When the town enacts Article 4, taking over the property, the municipality expects to have pre-purchase agreements worked out with the majority property owners where Amherst would transfer funds to them and at the same time take ownership of the site. The town doesn’t intend to operate the mall, but rather sell land back to its existing owners if they’re interested and/or sell parts of the property to other developers.
Generally, if there’s a challenge to the determination and findings, that can bump up the eminent domain process timeline from a minimum of about four months to 10 to 12 months. If an appeal is filed, that can delay the process by another four months, and if the court of appeals takes the case – which is statistically unlikely – that could tack on another five months, according to McNamara.
Although, that time could vary as the court of appeals has no time requirement to respond to an appeal.
But once a municipality does file to get into court on an eminent domain procedure law Article 4 proceeding, the condemner would be in front of a judge on a return date within 45 days. On that return date, the judge can issue the order of condemnation.
Before JCPenney filed its appeal, Kulpa outlined to Business First the next steps in the eminent domain process.
The town aims to prepare a request for proposal process for any land that the existing developers potentially don’t purchase back. Amherst must also finish its State Environmental Quality Review Act review relative to taking over the site and is putting together internal processes for reviewing documents for developers’ plans for the site.
“I don’t want to be stuck holding land without a path to sell it,” Kulpa said.
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