Council votes to settle Superblock lawsuit

The City Council voted unanimously at its Jan. 22 meeting to settle the city’s lawsuit against the owner of the long-vacant Superblock, paving the way for the potential development of the property.

The council agreed to settle with Manhattan-based iStar Financial, the Superblock’s current owner, and the former owner and developers of the property — Janow Associates LLC, Shore Road Development Partners LLC, Shore Road-Long Beach Superblock LLC, all subsidiaries of Philips International, a company owned by Philip Pilevsky; and Pilevsky himself. The city will be paid $5.25 million, and those funds have already been deposited in an escrow account, officials said.

The city filed the suit in 2011, claiming that millions of dollars in condemnation costs and legal fees still needed to be paid as part of its agreement with Pilevsky to develop the site. “These were corporations that were made exclusively for the development [of] the Superblock,” said Corporation Counsel Corey Klein.

Last April, State Supreme Court Judge Timothy Driscoll denied parts of the city’s claim, a decision that both sides appealed. But Driscoll pushed the city to settle with Pilevsky and iStar, saying that it “clears the way on the zoning board level for the potential development.”

“After 35 years of meetings, public hearings, planning and litigations, the city desires to settle all legal matters relating to the property known as the Superblock in order to move forward with potential development of the property,” the City Council meeting agenda stated.

To date, Klein said, the lawsuit has cost the city $400,000 to $500,000. “It would be nice to not have this expenditure anymore,” said City Manager Jack Schnirman.