Three-story height limit root of $6.9 million lawsuit
DELRAY BEACH — Two landowners are suing Delray Beach for at least $6.9 million over downtown building height limits the city hopes will keep the popular Atlantic Avenue strip quaint.
William “Billy” Himmelrich and David Hosokawa filed suit against the city two weeks ago, claiming the height limits restricted their property and development rights. The pair own four parcels of land — two parking lots and two buildings that house restaurants Tramonti and Cabana El Rey — just east of Old School Square cultural center.
The lawsuit — which claims the city violated the Bert Harris Act, a Florida law that protects private landowner rights — centers on a rule imposed in 2015 that limits new construction to 38 feet high, or three stories, along East Atlantic Avenue between Swinton Avenue and the Intracoastal Waterway.
Himmelrich and Hosokawa, who co-own the company DHBH Atlantic, had long envisioned building a four-story hotel on their properties, something Himmelrich says city officials were aware of since the mid-2000s.
“I had a property right and they essentially took it from me,” said Himmelrich, who owns and runs Old School Bakery on Congress Avenue, north of Atlantic Avenue.
The complaint also claims the city didn’t send notices to affected downtown landowners when the land-use restrictions passed, which is required under the Bert Harris Act.
Mayor Shelly Petrolia, who was a city commissioner when the building height restriction passed, said the rule came down after outspoken residents worried tall buildings would “canyonize” the narrow two-lane Atlantic Avenue.
“It was an understanding of what attracts people to our downtown. It has an almost nostalgic, storybook feel,” Petrolia said. “We had received quite a bit of feedback from our constituency that wanted to make sure that old-town feel was maintained at the same time of re-purposing some of the older buildings.”
Petrolia said she wasn’t aware of a plan to build a hotel on Himmelrich and Hosokawa’s land.
Himmelrich hired two architects, most recently in 2015, to draw up plans for the hotel before the building height limits passed. A four-story hotel would have 75 rooms, but a three-story hotel would only allow 50 rooms, Himmelrich said.
The pair bought one of their parking lots from the city in 2008 after both parties settled an eminent domain claim. The city’s Community Redevelopment Agency bought the land that is now Old School Square’s public park from Himmelrich in 2006 for $1.4 million.
The city sold the parking lot just south of the park, behind the restaurants, back to Himmelrich for $400,000 a year later.
The eminent domain case was settled in “friendly” terms, Himmelrich said. But, he added, the officials involved were aware that he and Hosokawa planned to develop the land they amassed on the block.
After the height restrictions passed, Himmelrich tried to argue his case with past and present city officials. He asked to meet with Petrolia without attorneys, but she declined, they both said.
Petrolia said she wanted an attorney present, knowing a legal claim might be in the pipeline.
“I really didn’t want to make the claim. I just wanted to get my four stories back,” Himmelrich said. “But they just pushed me too far.”
Himmelrich and Hosokawa, who lives in Massachusetts, are suing for damages and attorney fees. One appraisal Himmelrich sought said the building height limits resulted in a $6.9 million loss in fair market value of the four parcels.
Himmelrich said he’d be willing to come to an agreement that allows him to build a four-story structure.
The city would have to weigh the implications of such a decision, Petrolia said.
“We have to make sure we’re not setting a precedent that would change the look and feel of the entire corridor,” she said. “It’s disappointing because the last thing I want to see is one of our long-term business owners at odds with the city.”