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Long Beach may have to pay $149M for revoking permit on oceanfront condo towers

An empty lot next to the Seapointe Towers

An empty lot next to the Seapointe Towers property in Long Beach, where two 19-story condo buildings and a parking structure were to be built by a developer suing the city.   Credit: Newsday/Alejandra Villa Loarca

A Manhattan developer is seeking $149 million in damages from the City of Long Beach in a decades-old dispute after the city revoked a building permit to build three oceanfront condo towers.

A Nassau County Supreme Court judge is hearing testimony in the damages trial after the city was found liable and in default of damages owed to developer and partner Sinclair Haberman of Haberman & Haberman.

The city was found liable in 2015 for defaulting and failure to properly respond to a lawsuit over plans to build two 19-story condo buildings and a parking structure next to Seapointe Towers at Lincoln Boulevard and Shore Road.

Supreme Court Judge Jack Libert began hearing testimony last week in Mineola to determine what damages the city will be ordered to pay.

Haberman was previously seeking at least $50 million in damages, but the company has argued it is owed nearly triple that for lost revenue on its development, which was blocked by the city while it was tied up in litigation dating to 2003.

"The court ruled and the city conceded they revoked the permits," Haberman's attorney, Steve R. Schlesinger, said Wednesday. "We sued for $50 million or to be determined in 2003, and we thought it would be resolved in a reasonable time."

Long Beach officials did not respond Thursday to a request for comment. The city can no longer argue liability in the case, only against any damages claimed.

Attorneys for Haberman also announced a $23 million settlement last week with a partnering Long Beach developer, Xander Corp., in a dispute over the property.

Judge Libert is also deciding whether the city’s damages will be offset by that settlement or whether the city’s penalty will be determined separately. Attorneys for Haberman argued the city should not be entitled to shared damages in the settlement.

Xander and Haberman had planned to build four high-rise towers on the adjacent properties starting in 1985. Xander built the first building in 1988. Haberman filed a building permit for the second tower, but it was not granted until 2003.

Xander asked the Long Beach Zoning Board to revoke the building permit in 2003 because it did not meet a 1989 variance that required 1.5 parking spaces for each condo. Haberman was required to provide 189 parking spaces for the existing building on Shore Road.

Libert reinstated Haberman’s building permits in 2018 to build the three remaining buildings on the property — two 10-story buildings and a 7-story building.

The city was also required to install underground water utilities following a $200,000 payment by Haberman, but the work was not completed. The order extends the Haberman building permit, which was filed in 1992, until that work is completed.

Haberman had offered to settle the case in 2014 when former Long Beach Corporation Counsel Corey Klein signed a settlement, which would have dismissed the lawsuit and allowed developers to resume building on the property.

The City Council rescinded the settlement six months later, saying it was completed without council members’ knowledge.

Testimony in the case is scheduled to finish next week, and the judge may rule on damages by the end of the year, attorneys said.

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