By KRWG News
Las Cruces – The City of Las Cruces today announced that a final settlement has tentatively been reached in legal proceedings against local developer Philippos T. Philippou.
In early July 2009, the City filed two lawsuits against Philippou seeking compliance with subdivision requirements.
The monetary value of Philippou's subdivision requirements, according to the City's cost estimates, totaled $2,930,000. A partial settlement in August of $533,200 in Philippou-owned real estate that was conveyed to the City reduced that amount to $2,396,800.
Additional assets provided to the City in the form of surface water rights, real estate, a right-of-way along Mesa Grande Drive from U.S. 70 to Lohman Avenue, and engineering services will further reduce the debt Philippou owes the City to $1,098,800.
To offset the balance of $1,098,800, the City will obtain a security interest in additional Philippou-owned real estate worth a total value of $4,104,000 to guarantee performance and payment of all liabilities owed to the City.
The City will use the assets from the settlement to complete improvements within subdivisions left unfinished by Philippou.
According to Mayor Ken Miyagishima, the settlement is a win-win situation for all involved, especially the public. "Throughout this entire negotiation, our number one concern was that of the public. We wanted to ensure that their best interests were protected in our dealings with Mr. Philippou, and we're confident that this settlement achieves that goal. It does so in part, by helping maintain property values," Miyagishima said.
"In addition, it allows Mr. Philippou to proceed with developing nearly 600 lots. It will also help spark economic activity - contractors, subcontractors, construction workers, lenders, real estate agencies, building supply stores, etc. will all benefit from the result of this settlement," Miyagishima said.
"Another direct, and very significant public benefit resulting from this is that developers must now complete subdivision infrastructure requirements before they will be allowed to sell lots. This practice will ensure that issues similar to the ones in the Philippou matter won't ever arise in the future," said Robert Garza, assistant city manager.
The City anticipates that the implementation strategies will be finalized in the next several weeks, enabling city crews to take over completion of improvements, as well as operation and maintenance within all affected subdivisions.