Saugatuck, developer heading to court over houseboat development
City accused of breaking terms of land swap agreement
SAUGATUCK – Developer Dune Ridge is taking the city of Saugatuck to court over the city’s efforts to stop it mooring floating homes at its 443 Park St. marina.
Dune Ridge filed suit in Allegan County’s 48th Circuit Court earlier this month alleging the city had breached an agreement with the developer. Dune Ridge is also appealing a zoning board’s denial of several parts of its project.
“This is a case about local politics gone bad,” the complaint against the city begins.
Dune Ridge, whose principal is Paul Heule, is suing members of the Saugatuck City Council as it was composed in July 2019, alleging the city reneged on the terms of a land swap agreement with Dune Ridge. Those terms included Dune Ridge building a “privacy screen” between the Saugatuck Chain Ferry landing on Park Street and its docks, and, according to Dune Ridge, an understanding that the city would not regulate any structures built on the water.
However, public concern about Dune Ridge’s plans to moor luxury houseboats at the site prompted Saugatuck to first issue a moratorium and then, this summer, an ordinance regulating “floating homes” — distinguished from houseboats as structures that are not designed for the open sea and whose primary purpose is as a living space.
The ordinance banned floating residences from all areas of the city save for the zoning district called the Neighborhood Marine District, which does not cover 443 Park St.
Steve Afendoulis, a lawyer representing Dune Ridge, said his client had invested $1 million-$2 million in the project to design and build the “five-star floating hotel rooms” now prohibited by local code.
“After all of this, we had neighbors that didn’t like it and complained,” Afendoulis said.
Though there have been legal struggles between Dune Ridge and neighbors ever since Heule’s 2014 purchase of the 130-acre former Saugatuck Presbyterian Camps, the most recent outcry began with the 8-foot wood fence between the docks and the chain ferry landing.
Neighbors saw it as an eyesore and a safety concern, and brought to the city’s attention that the fence did not comply with city code.
“There’s a lot of traffic coming down Park Street with tourists going to Oval Beach and Mt. Baldhead in the summer,” said Ann Broeker, who lives near the chain ferry landing. “As pedestrian traffic comes off of the chain ferry, they just stream out onto the street because there’s no sidewalk or shoulder there. The fence blocks the visibility of drivers heading down that street.”
The city first directed Dune Ridge to apply for the proper permits and approvals from the Zoning Board of Appeals for the fencing, meters and bathhouse for the marina. While those approvals were pending, the city held off on any enforcement action against Dune Ridge, but after the ZBA denial of Dune Ridge’s plans the city sent a warning letter outlining several code violations in late August, promising enforcement action to come if Dune Ridge didn’t comply.
Dune Ridge filed its lawsuit and appeal of the ZBA decision Sept. 10.
Now that litigation has begun, the houseboats have been moved to the Dune Ridge docks.
Afendoulis said the boats were moved as part of his client’s legal obligation to minimize damages now that a lawsuit has been filed. Were the boats to remain in storage elsewhere, he explained, Dune Ridge would continue to incur storage fees, which it would claim as damages against the city of Saugatuck.
His client has pledged not to rent out the floating homes while the litigation is pending, Afendoulis said.
Neighbors are not so pleased with what Broeker called “blatant violation” of the city’s ordinances. Broeker had been thankful for the city’s “proactive” course of action in enacting the floating home ordinance and hoped it would prevent the development.
“I think most of us thought that was going to be the end of the story,” Broeker said. “The ordinance is very clear that floating homes can only be located in one part of the city.”
She said she and others in the neighborhood are continuing to communicate their concerns with the city.
The Saugatuck City Council meets Monday and will discuss the Dune Ridge litigation in closed session.