Terra Group’s Park Grove development harmful to business, Coconut Grove Bank lawsuit alleges

Miami-based Coconut Grove Bank filed a lawsuit against 2701 Bayshore Ventures LLC, an affiliate of developer Terra Group, seeking to halt work on its Park Grove condominium project.

The complaint alleges that the company is in violation of the lease agreement signed following the bank’s sale of its property to the developer. The bank is seeking an injunction on development and construction until the alleged lease violation is settled.

The complaint alleges that the actions of Terra Group’s affiliate will cause irreparable harm to the bank.

Terra Group, in partnership with the Related Group of Florida, intends to build Park Grove on the bank’s former property. The development is to include residential towers, a new bank building and various amenities. The architect attached to the project is the Office for Metropolitan Architecture, founded by starchitect Rem Koolhaas.

Coconut Grove Bank filed its initial complaint in Miami-Dade Circuit Court on Jan. 22, a week after 2701 Bayshore Ventures announced that it would not comply with the construction phases outlined in the lease, according to an amended complaint.

The bank has occupied the 2701 S. Bayshore Drive location in Coconut Grove for over 55 years and owned the parcel of land on which the bank and parking lot are situated. A subsidiary of the bank sold the 5.2-acre site to a Terra affiliate in a deal that closed in July 2013. The transaction cost $55 million.

The bank remains in the office building on site.

Coconut Grove Bank entered into a lease with 2701 Bayshore Ventures on Aug. 1, 2013. As part of the lease, it was agreed that the development would not interfere with the bank’s operations during construction. At the time the lease was signed, the Park Grove development was to include two residential towers, residential villas and a new bank building, according to the complaint.

The lease details construction phases that allow for the erection of the bank’s new headquarters on the property, along with 95 percent of the underground parking and part of the first residential tower of Park Grove before construction begins on the second residential tower, according to the complaint.

But at the time the complaint was filed, construction on the new bank building had not begun. On Jan. 15, 2701 Bayshore Ventures announced that it would abandon the residential villas and construct three residential towers at the same time it develops the new bank building.

The actions of 2701 Bayshore Ventures “will cause irreparable harm to the plaintiff bank including loss of customers, hindering its ability to attract new customers, creating a lack of access to the bank for its customers and damaging its goodwill,” according to the complaint.

Representation for Terra Group did not immediately respond to requests for comment. Coconut Grove Bank’s attorney in the suit, Andrew Hall of Miami’s Hall, Lamb and Hall, also did not respond to a request for comment.

In its lawsuit, the bank is demanding that the developer not commence simultaneous construction of the three residential towers until the new bank building is completed, that its Mary Street entrance is not blocked during construction, and that there is adequate parking for its employees and customers as detailed in the lease.

If Coconut Grove Bank is successful in its lawsuit, Terra Group would have to complete the bank’s new office building and parking spaces before building a second or third residential tower.

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Story by: Nina Lincoff – Apr 6, 2015, 4:08pm EDT
Photo Courtesy: Biz Journals & Google

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