Developer sues city for denying apartments

After plans to bring nearly 100 apartment units to Highland Village were rejected by the city, the developer of The District of Highland Village is taking the fight to a judge.

Highland Village-based HHSG, LLC, is suing the city in federal court on grounds that city leaders had already designated the property at FM 407 and Briarhill Boulevard as a Transit Oriented Development with the expectation that high-density, multi-family development would be approved.

The lawsuit further states that the city’s rejection of apartments is in violation of the Fair Housing Act because it discriminates against minorities.

The original approved plans for The District of Highland Village involved a mix of office and retail space with 73 single-family attached townhomes. After the real estate market tanked in 2008, the same year that the project first broke ground, demand for the townhomes plummeted.

According to the lawsuit, only one of the first twelve brownstones completed in 2010 was sold. Of the remaining 11 townhomes, 10 were rented out within a four-week span.

For most of the past year, HHSG, LLC officials have been trying to convince the Planning and Zoning Commission to amend approximately 6 acres of the 15 acre development’s plan to allow for apartments instead of townhomes.

The last plan presented to the city included 98 multi-family units in two-story buildings with a minimum apartment size of 750 square feet.

After being denied by the P & Z board over density, parking, school crowding, traffic, and compliance concerns, the developer tweaked the plans and made a final unsuccessful attempt to win its zoning amendment application at the City Council meeting on August 8. 

“We believe that the purported reasons for the denial were contrived and pretextual as outlined in the complaint,” said Dugan Kelley, an attorney with Christman Kelley & Clarke.

If approved, the development would have been the first apartment complex in the city.

HHSG, LLC is seeking actual and punitive damages. City officials could not comment on pending litigation.

See a copy of the lawsuit here.