Ambrose Property Group on Thursday responded to the city’s move to use eminent domain to take control over the GM stamping plant site the company owns, calling the action “unlawfully threatening” and a violation of an agreement between the development firm and Mayor Joe Hogsett’s administration.
The city sent a letter to Ambrose on Oct. 2 saying it wanted to acquire the 103-acre site—where Ambrose recently scrapped plans for a $1.4 billion, mixed-use development it named Waterside—and would use the legal process to force a sale, if necessary.
But Ambrose said in a statement Thursday that the move was “unfortunate and problematic on several fronts.”
The firm said it is willing to “discuss with the city the best path forward for Waterside and welcomes the city’s participation if it wants to be a productive part of the process.” But Ambrose said the city must come to the table in good faith.
“That process must involve putting the parties back in the positions they occupied before the city began making its illegal and baseless threats to take Waterside from its rightful owner,” the company said.
The company, through its Chicago-based law firm Quinn Emanuel, also sent a letter to city officials claiming they had made several “false and misleading statements” about the city’s legal ability to acquire the property.
The company has been damaged by the city’s claim it can purchase the property, the letter said.
Taylor Schaffer, the mayor’s deputy chief of staff for communications, said officials are still reviewing the letter. But, she said, “It is obviously not the response that we—or neighborhood leaders—were hoping to receive.”
The city’s letter to Ambrose, penned by City Corporation Counsel Donald Morgan last week, indicated the city was open to negotiating a deal with Ambrose to sell the property, but had already “set in motion the required steps under state law” to move forward with the eminent domain process if those talks break down or do not occur.
To “avoid the delay and expense of a court process, we would welcome the opportunity to begin negotiation acquisition of the property immediately,” the letter said.
Schaffer said the city’s preference is still “to reach an agreement with Ambrose that will ensure a future for this site in keeping with both its potential and prior development commitments. We stand ready to begin those conversations, and remain optimistic that they will produce productive outcomes for the property and the surrounding neighborhoods.”
Ambrose announced on Sept. 27 it was dropping plans to redevelop the former stamping plant site on the west edge of downtown. The Waterside project would have included 1,350 residential units, 620 hotel rooms, 2.75 million square feet of office space and 100,000 square feet of retail space.
At that time, it indicated a desire to sell the land to another developer who could move the project forward and had already enlisted JLL to look for buyers.
In mid-September, Ambrose sold a 12-acre piece of the property to the Indianapolis Zoo, along with another parcel to the north. Ambrose paid the RACER Trust—the organization that owned the land and other former GM industrial sites—$3 million for the five-parcels that comprise the 103 acres in 2018.
But the city is standing in the way of an effort to sell “to a buyer who has similar goals” for the entirety of the former stamping plant site, the company said in its letter.
“The city is attempting to use eminent domain to interrupt an otherwise competitive market sale process with numerous possible buyers in an effort to ensure that the city is the only bidder,” Ambrose’s statement said. “We continue to believe that a common-ground solution that does not include a court fight would be best for everyone, but if we have to, we will engage in litigation to protect our rights.”
Ambrose said the city’s eminent domain steps breach an agreement that states it has no authority to take the Waterside property.
The firm’s letter also says Ambrose plans to pursue a claim for what’s called “slander of title,” a legal term that applies when something that is published clouds ownership of real estate and causes a loss to the owner.
“Ambrose has already suffered losses … and is continuing to suffer losses due to the city’s public statements that have impaired Ambrose’s ability to sell Waterside (as it is entitled to do under the project agreement), slandered the title of the property, and disparaged Ambrose’s reputation,” the letter said. “Ambrose has suffered significant damages and intends to seek all just and appropriate relief to protect its rights and seek financial compensation for its losses.”
The Indianapolis-based company signed a project agreement with the city last year, in which Hogsett’s administration agreed to contribute $26.8 million to the first phase of Waterside, primarily for infrastructure and utility work. The city has already spent hundreds of thousands of dollars on preliminary design work tied to the development.
The project agreement says that the city will “not seek to involuntarily acquire any portion of the Property for an economic development project on the Property that will ultimately be privately owned or largely occupied for private activities.”
Ambrose also chastised the city for trying to use eminent domain on a site that is not a public nuisance or blighted, but rather “a highly valuable property that has millions invested in it.”
Deputy Mayor Thomas Cook said last week that eminent domain has been a consideration for the land since Ambrose announced it was pulling out of the Waterside project, but that officials decided last week it was time to send a letter to Ambrose to try to compel the firm to the table for negotiations.
“We’ve been clear with them in our early conversations that the city had an interest in purchasing the property,” he said at that time. “We have had a very productive working relationship with Ambrose over the last two or three years. We are hopeful that they will come to the table in that same spirit and that we can quickly resolve the question of this property.”