PROVIDENCE – Representatives of FM Global, the Town of Johnston and Capital Lease Funding Inc., the company seeking to halt the construction of FM Global’s new headquarters, are slated to meet behind closed doors this morning with a Providence County Superior Court judge.
In complaints to the town and the court, CapLease has criticized the process by which town permits for the $60 million project were granted. On Wednesday night, the Johnston Zoning Board of Appeals voted to deny each of the four appeals CapLease has filed with the town.
“Each time, the Zoning Board of Appeals felt that the town had made the right decisions along the way,” FM Global spokesman Steve Zenofsky told Providence Business News.
Now, he said, Associate Justice Michael A. Silverstein – the judge who Tuesday issued a restraining order barring the town from issuing any more permits for the development until the dispute is resolved (READ MORE) – has asked the parties to provide an update on the case.
Plans for the new headquarters, on a 93-parcel the company already owned off Central Avenue, were unveiled by FM Global on Dec. 13. The commercial property insurer officially broke ground on April 9, expecting to complete the project by mid-2009. (READ MORE)
But within weeks, the CapLease complaints had spurred the town to issue a stop-work order for the FM Global site. Now, under Silverstein’s extension of that order, work at the site is limited to completing the foundation.
Although the company’s complaints also cite other issues – including “traffic, storm-water runoff and the impact on wetlands,” CapLease attorney Edward Pare, a lawyer with the Providence office of Brown Rudnick Berlack Israels LLP, previously has said – the crux of the appeals brought forward by CapLease is that its own engineers didn’t have enough time to review FM Global’s completed application before public hearings were held.
The town code is “vague” about the purpose of the 32-day period allowed for the review of completed applications, Johnston Zoning Board Chairman Douglas Jeffrey said at the board’s Wednesday night meeting. He concluded that the code is worded to allow for internal review by the town, saying: “My interpretation is that if it were specifically for public comment, I think it would specify ‘public comment.’”
CapLease has now exhausted its options for appeals through the municipal code, Pare said yesterday. “The Zoning Board has basically denied our appeals, claiming that the Planning Board did everything properly,” he said. “Now, under state law, they’ll have to issue a written decision … then we can analyze that and decide how to proceed.”
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A CapLease subsidiary, Prefco II LP, has owned FM Global’s current headquarters since April 2007 and is leasing it back to the insurer under an agreement that expires in July 2009. FM Global is currently paying more than $9 million a year to lease the Atwood Avenue property, with an option to renew for about $4.5 million per year, Pare said yesterday.
Capital Lease Funding Inc. (NYSE: LSE) is a real estate investment trust with more than $2 billion in assets. For more information, visit www.caplease.com.
FM Global is a commercial and industrial property insurer with roots in Rhode Island that stretch back to 1835. It employs 4,700 people around the world – including nearly 1,700 in southern New England, at its Atwood Avenue headquarters, its research campus in Glocester and its offices in Norwood and Waltham, Mass. Additional information is available at www.fmglobal.com.
