COLUMBUS — The developer of a Columbus urgent care facility is asking the city to use its eminent domain powers to circumvent a decades-old covenant that’s preventing development at the 3323 23rd St. site.
Brad Felger, vice president and co-owner of Omaha-based Family Urgent Care, and his attorney Chris Blunk appeared before Columbus City Council Monday night in an attempt to convince the group to initiate an eminent domain proceeding to acquire the parking rights on the lot purchased by Family Urgent Care in November.
Family Urgent Care bought the property near the intersection of 33rd Avenue and 23rd Street for $144,141 and broke ground at the site in March with hopes of completing the 4,000-square-foot building by Aug. 1 of this year.
However, the nearly $1 million Family Urgent Care of Columbus project was immediately met with a civil lawsuit filed by the owners of Westgate Center Mall and the former Walgreens building, which sit just south of the proposed development site.
In the lawsuit filed March 23 in Platte County District Court, FICON Holdings LLC claims construction of the urgent care violates a 1984 restrictive covenant that reserves the undeveloped area within Westgate Center for parking and pedestrian access. This common area agreement, which was originally entered into by Hy-Vee, Walmart and One Eleven Corporation of Lincoln, an affiliate of Hub Hall Companies that owned the mall and former Walgreens at that time, requires the approval of all property owners before the site plan can be modified.
It was amended in 1985 when a Wendy's restaurant was OK’d for the northeast corner of the property, where The Pizza Ranch now sits.
Felger and his attorney claim a redevelopment plan for the area adopted by the city council in August 2010 can’t proceed because of this restriction. They’re asking the council to condemn the restrictive covenant that is preventing the urgent care’s development.
Felger told the council Monday he was assured there would be a new controlling document for the area in place prior to his company’s November purchase of the 3323 23rd St. property.
Because this never happened, Family Urgent Care, also known as HBF Holdings LLC, is suing the former owner of the property, Columbus-Westgate II LLC, an affiliate of Dial Companies that owns the former Hy-Vee building, to reverse the purchase and recoup thousands of dollars already invested in the stalled urgent care project.
However, Felger said the owner of Columbus-Westgate has threatened to file for bankruptcy if Family Urgent Care’s lawsuit is successful.
“And seeing his track record of not improving his property, it’s safe to assume that if we win our suit that corner would remain an eyesore for a long time,” he added. “What we’re asking from the city council is a solution to the problem.”
Felger assured the council that his company would only seek monetary damages from Columbus-Westgate and begin construction on the urgent care as soon as possible if the city uses its eminent domain powers to remove the restrictive covenant — something that would have to be done at the city’s expense.
Family Urgent Care, which currently operates three urgent care locations in Omaha along with Urgent Care of Norfolk, selected Columbus as the first of 20 Nebraska and Iowa locations where it plans to open a new urgent care facility over the next five years.
According to Felger, Family Urgent Care has stopped fighting the lawsuit against them since District Judge Robert Steinke granted a temporary injunction May 11 that stops the urgent care development for now. In his decision, Steinke stated that the redevelopment plan doesn’t trump any previous contractual rights and construction of The Pizza Ranch doesn't serve as a waiver for any further breaches of the common area agreement.
The Pizza Ranch opened in March 2011, four months before FICON Holdings purchased the Westgate Center Mall and adjoining retail building for $1.25 million.
FICON Holdings, which has a local address of 2055 33rd Ave., the same location as C.S. Nelson Co. Real Estate, is seeking a permanent injunction to stop the construction.
Greg Barton, an attorney representing FICON Holdings, said Family Urgent Care’s request for eminent domain is not a legitimate public purpose to destroy FICON’s contractual rights and the corporation shouldn’t be responsible for any misinformation provided to the urgent care developer.
Barton, who called the urgent care development a “major concern” to the seven tenants of Westgate Center Mall because it would restrict visibility from 23rd Street, said FICON is willing to negotiate with Family Urgent Care but also prepared to defend themselves in court if the city chooses to move forward with an eminent domain proceeding.
Felger and Blunk argued that FICON has been unwillingly to negotiate and the urgent care’s development would have no effect on the existing businesses.
“We’re as far away as you can possibly get,” said Blunk, who added that this issue will continue to keep lots from being developed there unless it’s resolved.
“We’re just the tip of the sword,” he said.
The council made no decisions Monday regarding Family Urgent Care’s request, which will likely appear as an action item during the Sept. 4 meeting.