Schnitzer West sues Westminster after downtown office project falls through

This story first appeared on BusinessDen.com, a BizWest news partner.

Plans for 650,000 square feet of office space in a development dubbed Downtown Westminster have failed to materialize more than three years after they were announced, and a developer now is suing the suburban city for backing out of the project.

The City of Westminster excitedly announced in October 2019 that Schnitzer West, a Washington-based firm also developing projects in RiNo and Cherry Creek, would construct two buildings in Downtown Westminster, the first office space there.

“This is just the beginning in the Downtown,” the city’s economic development director boasted in a news release.

Located near U.S. Highway 36 and Sheridan Boulevard, Downtown Westminster was the site of a mall that city officials razed in 2011. In 2018, it was considered a possible location for Amazon’s second headquarters before the retail giant chose northern Virginia.

Today, the area has a movie theater and a few retail stops, including a Tattered Cover bookstore, along with a hotel and apartment buildings. It does not have office space.

In a lawsuit filed Feb. 1 in Jefferson County District Court, Schnitzer West said that’s because the City of Westminster has refused to sell it the two lots it was going to build on.

Schnitzer claims that a contract between itself and Westminster dating back to 2020 requires the city to sell it the land. After several delays, and after Schnitzer West spent more than $1 million planning the project, closing was to occur on Sept. 26, 2022.

But Westminster grew concerned about the developer’s financing and parking plans, according to the lawsuit. Schnitzer told the city that its concerns were unfounded but the city, in turn, refused to close on the sale, according to Schnitzer’s lawsuit last week.

“The city doesn’t comment on pending litigation,” said Westminster spokesman Andy Le.

Schnitzer wants Judge Lindsay VanGilder to force Westminster to either sell it the property or pay it the money Schnitzer has spent and would have earned from the project.

Schnitzer is represented by attorneys William Jones and Patrick J. Hickey of Moye White.

It’s not Downtown Westminster’s first real estate lawsuit. Last July, Tattered Cover was sued by Denver-based Frontline Construction, which accused it of not paying $123,000 for work on the bookstore. That dispute was settled out of court the following week.

It’s also not the only time in recent months that Westminster has been sued by a developer. Rozzi Capital in Denver sued in November, accusing the city of agreeing to sell 7.8 acres at the northeast corner of 104th Avenue and Westminster Boulevard and then backing out.

Schnitzer, meanwhile, is developing a 12-story, 238,000-square-foot office building called The Current at 3615 Delgany St. in RiNo and preparing to break ground on an eight-story building at 201 Fillmore St. in Cherry Creek that will house Antero Resources Corp.

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