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Harrisburg files countersuit against developer

By Ben McNeely | Media General

Published: October 28, 2009

HARRISBURG - The Town of Harrisburg alleges in a countersuit that the builder of Town Hall owes back rent.

The countersuit, filed Oct. 26 with the Cabarrus County Clerk's Office, refutes the claims of a lawsuit filed by Harrisburg Town Center IV, where the developer claims the town owes about $365,000 in back fees stemming from the original contract the town had with HTC IV over the first floor office condominium in the Town Hall building.

The countersuit states it is the developer, not the town, that owes money -- about $112,000 in back rent through a period of two years. The countersuit also asks for the developer's lawsuit to be dismissed.

Harrisburg and HTC IV entered into two contracts in October 2003, where the town agreed to purchase the first floor of the Town Center, then lease back a portion of that space to HTC IV for five years. The town put down $600,000 as a down payment on the $1.6 million base sale price.

The town did not close on the purchase until Jan. 10, 2008. In the meantime, HTC IV leased out space to Robert MacLeod, owner of Hibernian Hall, to keep revenue coming into the building while the town sorted out its financing.

The contract between HTC IV and the town stipulated the town would pay $200 a day to HTC IV in damages for delaying closing on the deal, according to the lawsuit.

Then, in August 2008, then-Town Administrator Joel Davis sent written notice to HTC IV to vacate the leased portion of the first floor because the town needed more office space.

HTC IV complied and Hibernian Hall vacated the space in November 2008.

But then the town came back to HTC IV, saying Davis was not authorized to take such action and HTC IV needs to pay rent on the vacated space, despite the town asking HTC IV and Hibernian Hall to leave.

Attorney Brett Dressler, representing HTC IV, said his client has bent over backwards to accommodate the town.

But Harrisburg disagrees, said town attorney Richard Koch. The town takes the position that HTC IV owes Harrisburg back rent on the first floor leased space.

Contact Web reporter Ben McNeely: 704-789-9131