The future of the long-awaited Veridea development will remain linked to the man who proposed it – for now – after the Town Council voted Tuesday not to amend a town ordinance that would have allowed developers to remove him from the project.
In a split decision that required Mayor Lance Olive to cast a rare tiebreaking vote, the council denied a request by Hudson Realty Capital, the majority property owner and investment group in charge of the 1,100-acre Veridea project.
If Hudson’s request to change the town code had been approved, the firm would have been able to remove Lookout Ventures’ Tom Hendrickson as the project’s “responsible person” and advance its vision for the project through an intermediary of its choosing.
With Mayor pro tem Nicole Dozier absent and the remaining four members split 2-2, Olive sided with council members Gene Schulze and Denise Wilkie, who voted to deny the request.
Jensen and Moyer voted against that motion, saying they would prefer to table the requested amendment. That would give Hudson a chance to submit a proposal and prove Hendrickson is inappropriately obstructing the project.
Hendrickson, who first brought the sustainable, mixed-use concept of Veridea to the town, doesn’t own any of the Veridea property and has a marginal stake in the property. But he still acts as the intermediary between developers and the town under the terms of the ordinance governing this type of development. His signature is required for development proposals to be brought before the town.
“I think leaving things open can leave confusion, but closure doesn’t mean a door can’t be tried again,” Olive said as he cast his vote.
“I believe there hasn’t been a demonstration yet of the inability to use property,” he said. “This council reviewed very carefully what the responsible person’s role was, and that was primarily to protect the vision of the entire project, no matter how many developers there are that want to develop pieces.”
Under the current code, Hudson, or anyone Hudson sells the project to, needs to get Hendrickson’s blessing to submit rezoning requests or a site plan to the town.
Hudson representatives reiterated the position they presented to the planning board a week earlier, where their proposal was approved 5-1. They said the firm, as the owner of the vast majority of Veridea’s land, should be able to install its own responsible party.
While no requests have been formally submitted to Hendrickson, Hudson and Hendrickson’s visions for Veridea have diverged since the development was first presented to the town.
The sustainable development ordinance, developed to handle projects of Veridea’s type and scale, only allows Hendrickson to be replaced if he steps down voluntarily or in the case of his death, incapacitation or insolvency.
Jason Barron, the lawyer speaking on Hudson’s behalf Tuesday, said land owners shouldn’t be required in any case to submit to the whims of “a disinterested third party” before developing it.
“Even if the parties were getting along, I’d tell you this is a fix that needs to be made,” Barron said. “You can’t have a scenario where you’ve zoned 1,100 acres but the owners can’t do anything with the property. Folks have a right to do something with their land.”
Reader & Partners, a company specializing in large-scale development, was presented Tuesday as Hendrickson’s potential replacement, while Richard Ortiz, a Hudson co-founder, assured the council that he and his partners are strongly committed to the success of Veridea, the firm’s single-largest investment.
“We believe that as owners we can agree to disagree about certain aspects of zoning, but you cannot be denied the right to control what happens with the property,” Ortiz said. “To have someone not appointed by the town or ownership controlling this is not a tenable situation. To us, it’s not morally correct, and it’s certainly not legally correct.”
Schulze and Wilkie, who were unequivocal in their votes to deny the request, said they had no reason to believe Hendrickson wouldn’t sign off on plans consistent with what had been promised to the town.
“The plaintiff is claiming they don’t have their constitutional rights,” Schulze said. “So who took them away? In my opinion, their rights weren’t taken away. They were given away. Lookout (Ventures) didn’t put a gun to their head and take away their property rights.”
Hendrickson said Hudson had agreed to that provision, among others, when it helped the town write the sustainable development ordinance. He, Schulze and Wilkie said Tuesday that the role of the responsible party had been crafted intentionally to prevent developers from building something substantially different from what the town agreed to when it approved the development.
“If you bring a plan that’s 90 percent housing, and (Hendrickson) says ‘no,’ he’s doing what he’s supposed to be doing, according to the wishes of the council.” Wilkie said. “You’re not denied the use of your land. As long as you’re doing what you’re supposed to be doing, he’ll go along with what you’re saying. It’ll come to the council, and it’ll be approved.”
Gargan: 919-460-2604; @hgargan
What is Veridea?
Veridea is a 1,100-acre development proposed for land in southwest Apex bounded by U.S. 1, N.C. 54 and N.C. 55. Tom Hendrickson of Lookout Ventures introduced the project to the town in 2008 as a sustainable, mixed-use development that would allow residents to live, work and shop – a development strategy meant to ease the burden on Apex’s roads and highways as the town grows.
Since then, Hudson Realty Capital, the investment group that now owns the land, is anxious to begin building and deliver returns to its investors. Hudson’s current plan is to begin building houses and wait for retailers and office tenants to fill in behind residents. Thus far, some council members haven’t favored that approach or proposed departures from the sustainable aspects of Hendrickson’s original proposal.
The current council majority has prioritized commercial development above further residential construction, and those council members are worried a homes-first strategy could compromise the development’s mixed-use potential. They want more of a guarantee that commercial tenants will materialize.
Meanwhile, Hudson representatives say that building homes first is the only thing that can guarantee interest from commercial tenants, who often want a substantial number of residents in place before setting up shop nearby.
Hudson also has asked the town to help finance the sewer improvements needed to service the land. Those talks have advanced recently, but the town still holds the requested $27.5 million as leverage in discussions about what Veridea will ultimately look like.