Forest City Residential has withdrawn a demand letter for $2 million sent to the City of New Rochelle earlier this month.
In a letter dated February 5th, Forest City's counsel notified the City that Forest City was terminating the Memorandum of Understanding (“MOU”) between the City and Forest City relating to the Echo Bay Waterfront Redevelopment Project (the “Project”), and demanding reimbursement of the costs and expenses it voluntarily chose to invest in the Project.
Forest City claimed $3.2 million in expenses and demanded reimbursement of $2 million citing a "willful misconduct" clause in the MOU:
if the MOU is terminated by Forest City as a result of the willful misconduct of the City, then the City shall be liable for and shall reimburse to Forest City all Municipal Expenses incurred and previously paid by Forest City, and all other out-of-pocket "soft" costs incurred and paid by Forest City for the design of the Project and review of the Project under SEQRA, said amount not to exceed $2.0 million.
Talk of the Sound broke the news that Forest City had threatened the City of New Rochelle with a Lawsuit over failed Echo Bay project
In a statement issued today, Forest City Residential stated:
While the City of New Rochelle and Forest City Residential have different perspectives about the manner in which the Echo Bay waterfront redevelopment concluded, we have agreed together that the interests of both parties are best served by moving forward. Accordingly, we are today setting aside our claim for expenses associated with the project. We wish New Rochelle’s citizens, elected officials and city staff success as the community continues to pursue its goals at the waterfront.
The City of New Rochelle responded with their own statement:
For several years, the City of New Rochelle and Forest City Residential worked in partnership to revitalize the Echo Bay waterfront. During this process, New Rochelle developed great regard for the professionalism and creative vision of the Forest City team. New Rochelle recognizes Forest City’s significant investment in the Echo Bay site and is, therefore, grateful for Forest City’s decision to set aside its claim for expenses. New Rochelle and Forest City’s partnership at Echo Bay began in a spirit of mutual respect, and it now concludes in that same spirit.
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