The developer behind a planned $20 million conversion first proposed nearly two years ago for a dormant hotel in downtown Petersburg is facing a lawsuit from a Richmond architecture firm that says it hasn’t been fully paid for its services.
Shockoe Slip-based Commonwealth Architects has sued C.A. Harrison Cos., the Maryland-based firm leading the expected redevelopment of the nine-story former Ramada Inn along Interstate 95 into a hotel-anchored mixed-use development.
Commonwealth Architects, which had drawn up plans for the project when it was announced in late 2015, alleges it is owed $152,000 for services provided as part of a revised contract with C.A. Harrison that was signed in July 2016. The suit alleges breach of contract and seeks payment of $155,000 – described as the “reasonable value” of its services – plus interest and legal costs.
Plans presented at the 2015 project announcement called for a 125-room hotel, 100 apartments and upwards of 20,000 square feet of retail in five additional or renovated buildings lining Washington and Wythe streets, just west of I-95 at the end of the Exit 52 off-ramp. Richmond restaurant Mama J’s was signed on to open a second location in the development.
The existing nine-story, 125,000-square-foot hotel building would be turned into a Cambria hotel & Suites brand and resized, with the top two floors removed and additional footage added onto each side to make the 1973 building consistent with industry standards.
The project was estimated to cost between $20 million and $25 million overall.
Reached Thursday, C.A. Harrison principal Christopher Harrison said he had not been served with or seen the lawsuit, which was filed in Richmond Circuit Court on July 27.
“They’ve been trying to bill for services they didn’t provide, but I have all the information that would clear me on that, so I’m not worried about that,” Harrison said.
He said his firm would be represented in the case by Richmond attorney Godfrey Pinn of Harrell & Chambliss.
Commonwealth Architects is represented by Durrette Crump attorney S. Sadiq Gill. He said Thursday his client did perform services that have value and warrant compensation.
“Commonwealth is in the business of doing adaptive reuse renovations, and those typically require some capital upfront to make that happen. This is no different,” Gill said. “They’ve done work, they’ve billed for the work, and (Harrison) has had every benefit of the work.
“I think it’s a question of whether (Harrison’s) project moves forward or not,” Gill said. “It’s not that we didn’t do the work and we didn’t send the bills and he doesn’t have value for what (was done).”
Harrison said the Petersburg project has secured financing and is scheduled to go before Petersburg City Council in September for final approval of performance agreements, after which he said construction would start and last between 15 to 18 months.
“We’re just waiting on some governmental financing to get finished up,” Harrison said, describing the project’s financing arrangement as a combination of public and private funding.
Last September, the governor’s office announced the project would receive $600,000 in state funding as part of $1.97 million in Industrial Revitalization Fund grants awarded to Petersburg and other localities. This February, the state awarded Petersburg $350,000 in grant funds for the project through the Virginia Brownfields Restoration and Economic Redevelopment Assistance Fund.
The lawsuit states that Commonwealth submitted a proposal to C.A. Harrison in October 2015 to provide services for the hotel property and adjacent parcels at 380 E. Washington St. The proposal was to provide conceptual analysis services to identify any issues that may arise during construction.
The total cost of those services, according to the suit, was $45,820, though a an amendment to the proposal in March 2016 added architectural, structural, civil engineering and other services to be completed through the design phase that upped the cost an additional $1.12 million.
The suit states Harrison accepted and signed the amended contract and that Commonwealth performed the scope of the work, but claims the firm was not paid the balance of the contract and is owed the $152,000 amount.
Commonwealth had worked with Harrison before, on an apartment project in North Carolina. A press release stated the Petersburg project would involve the same team that worked on the N.C. apartments, including Alabama-based Capstone Building Corp. and Philadelphia-based program manager Innova Services.
C.A. Harrison’s other local work has included 2001 East, a mixed-use project at 2001 E. Broad St. that was sold in June for $9.6 million. The firm was also behind the 66-unit Argon Apartments renovation at 3805 Cutshaw Ave. That building sold the same month for $10.2 million.
Since the project was announced, financial struggles forced Petersburg to undergo significant changes in the makeup of its city government, including the dismissal of its city manager at the time and the recruitment of consultants such as The Robert Bobb Group and former Richmond city manager Jack Berry.
Asked if those changes have affected the project in any way, Harrison said no.
“We’re still moving forward with the same Cambria hotel,” Harrison said.
When the project was announced, Harrison said he was aiming to break ground by mid-2016, with the overall project completed by mid-2017.
“We’re going to start as soon as we close on the construction loan,” Harrison said, adding that he has a commitment on that loan. “We’re just wrapping up some agreements with the state and city, but we should be good to go.”
The city purchased the building in a tax sale in 2014 for $176,745 – the amount of back taxes owed on the property, which the city had declared a public nuisance. City representatives said when the project was announced that the property would be sold to C.A. Harrison through the course of the project.
Attempts to reach Petersburg’s city manager’s office for comment on the project were not successful Thursday.