RALEIGH - City Manager Russell Allen told the City Council Tuesday that an agreement has been reached with a Fayetteville Street property owner whose permission was needed to build City Plaza.

The agreement avoids what could have been a nasty legal battle between Raleigh and The Simpson Organization, owner of the Bank of America building and the underground parking garage under Fayetteville Street.

Two weeks ago, the City Council voted to allow a condemnation lawsuit to be filed against Simpson. Allen asked the council to authorize condemnation after concluding that the negotiations with Simpson, which have been going on for more than a year, could drag on indefinitely.

The agreement gives Raleigh the easements it needs to put the plaza and roadway over The Simpson Organization's property.

The $16 million plaza at the south end of Fayetteville Street is to be a high-tech gathering place that can be closed to cars and reconfigured to accommodate parades, markets or concerts. Because of the delay, the earliest the project can open is August 2009.