Lawsuit: Dispute over land led Reed officials to threaten developer

Senior members of Mayor Kasim Reed’s administration allegedly threatened a prominent developer that he would never again do business with the city unless he relinquished a claim to property the city wanted for a new recreation center, according to court papers filed Monday.

The filings allege the threat was made during a meeting between Reed’s former chief operating officer, his parks commissioner and developer Egbert Perry, CEO of The Integral Group, on May 21,2014.

If Perry didn’t give up his claim to the property, “We will make it difficult, if not impossible, for you to do business in the City of Atlanta,” the city’s then-chief of staff told Perry, according to the filing.

The allegation emerged as part of a lawsuit and political battle between the developer, Reed, and Atlanta Housing Authority. At stake is control over at least tens of millions of dollars worth of the authority’s vacant land, much of it in rapidly gentrifying neighborhoods close to public transit and jobs.

A Reed spokeswoman fired back against Perry and what she called “his immoral and repugnant behavior” in a written statement to The Atlanta Journal-Constitution.

“Egbert Perry is lying,” the statement said, accusing Integral of trying to make “a windfall profit at the expense of Atlanta’s low-income families.” The statement did not directly address whether the threats were made.

In 2011, AHA’s prior leadership gave companies tied to Integral an exclusive right to purchase the land, including the property Reed sought for the recreation center, for several years. Now AHA wants out.

The city faces an affordable housing crisis, and the contracts held no guarantee that Perry would build housing for low-income and working-class residents. AHA estimates that the deal gives Integral a $120 million discount on the land, a figure the developer disputes because no formal appraisal has been done.

The housing authority’s current leadership filed suit in September to kill the agreement. In October, Reed weighed in publicly with a blistering letter to Perry demanding he resign his post as board chairman of home finance giant Fannie Mae over the deal, which he described as “unlawful” and “unethical.”

Perry argues that there is already too much affordable housing on these siteswhich previously held public housing projects. Building more affordable housing would re-concentrate poverty on the sites where new, mixed-income housing was built to break it up. Also, AHA has plenty of other vacant land, Perry said.

“During the past eight years AHA has owned, and continues to own, over 300 acres of land on approximately 12 other former public housing project sites, all of which continue to sit vacant and untouched,” Perry said in a written statement.

Michael Geisler, then the city’s chief operating officer, delivered the alleged threat in a meeting with Perry, lawyers for Integral state in their court filing. AHA’s Joy Fitzgerald, then the interim head of the authority, and Atlanta Commissioner of Parks and Recreation Amy Phuong were there as well.

“Mr. Geisler then repeated the message verbatim and Ms. Phuong confirmed that he had accurately relayed the message,” the filing states.

Attempts to reach Geisler by telephone and email were unsuccessful. Fitzgerald said she was out of town visiting family and did not have time to comment. A city spokeswoman did not make Phuong available to speak before deadline.

Current AHA CEO Catherine Buell said through a spokesperson that she was unaware of any such threat to Perry. AHA Director of Communications Cecilia Taylor stressed that the authority’s land should be used in the public’s interest.

“It’s unfortunate that AHA would have to plead with any of our development partners to use public land for public benefit,” Taylor said.

Grady LLC, the entity related to Integral, gave up its rights to build on the natatorium site in exchange for more than $1 million in credit that it would use to purchase land involved in the 2011 deal, according to records of AHA minutes submitted with Monday’s court filing.

The $24.4 million Martin Luther King Jr. Recreation & Aquatic Center opened on the disputed site late last month.

Reader Comments ...

Next Up in Local

Police: Road rage escalates to gunfire, kills 1 teen, injures another in Decatur
Police: Road rage escalates to gunfire, kills 1 teen, injures another in Decatur

A teen was shot and killed during a road rage incident in Decatur Wednesday afternoon, Channel 2 Action News reported. Police arrived at the intersection of South Candler Street and Midway Road around 5:45 p.m. to find two people shot inside a car, Decatur Police said in a Facebook post. Both were transported to a hospital, where one of the two died...
Cops: Woman stole roommate’s jewelry worth $4,500, sold it for $200
Cops: Woman stole roommate’s jewelry worth $4,500, sold it for $200

A Hall County woman told authorities some of her and her roommate’s jewelry was stolen. But deputies said she lied, stole her roommate’s jewelry and sold it for a fraction of what it was worth. Cynthia Leigh Fuller, 58, of Gainesville, allegedly stole jewelry valued at more than $4,500 and unlawfully sold it to another person for $200,...
THURSDAY’S WEATHER-TRAFFIC: Summer arrives with more heat, scattered afternoon storms
THURSDAY’S WEATHER-TRAFFIC: Summer arrives with more heat, scattered afternoon storms

Thursday: High: 90 Thursday night: Low: 72 Friday: High: 88 Atlanta will welcome summer Thursday morning. And it’ll still be hot. Very hot. An area of high pressure over the Southeast has been keeping the rain at bay, meaning there’s been few clouds to stop the sun from beaming down across the state, Channel 2 Action News...
Race takes center stage on Day One of Spalding cold case murder trial
Race takes center stage on Day One of Spalding cold case murder trial

Racial animus led Franklin Gebhardt to murder Timothy Coggins in 1983, prosecutors said Wednesday. Indifference over a black man’s death left the Spalding County case unsolved for 34 years, Griffin Judicial Circuit Chief Assistant District Attorney Marie Broder said in her opening statement. It was an admission seized upon by Gebhardt’s...
Teen killed in crash days before starting college
Teen killed in crash days before starting college

An 18-year-old who was about to start college was killed in Coweta County when her car flipped at least seven times before landing in a church driveway, Channel 2 Action News reported.  About 7:30 p.m. Monday, Jasmine Williams’ car went off the road on Ga. 34, according to the news station. Investigators believe it went airborne before hitting...
More Stories