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Judge rules against Milligan in zoning appeal of Wall Street Place

Milligan touts successes, promises sock stretching announcements

Real estate broker Jason Milligan, right, at the Wall Street improvement project design kickoff, June in the Wall Street Theater.

Updated, 5:32 p.m. Wednesday: Settlement talks information.

NORWALK, Conn. — Citibank’s plan to restart construction on Wall Street Place (oft-referred to as “The Tyvek Temple” or simply “POKO”) has cleared a hurdle, now that a State judge has ruled against real estate broker Jason Milligan.  Milligan had appealed the Norwalk Zoning Commission’s approval of the project.

Judge Charles Lee dismissed Milligan’s appeal Friday. It’s the latest legal setback for Milligan, who said he hasn’t decided whether to appeal Lee’s ruling.

“I have a choice to make. I am not surprised by the recent zoning appeal decision. Judges rarely will rule against a local zoning commission. The appellate court is much more likely to rule against a municipality if I decide to take it there,” Milligan said in an email.

Milligan is, of course, embroiled in multiple lawsuits with the City. Recent developments:

  • A trial in the major “POKO” lawsuit has been pushed to next year.
  • Milligan questions the withdrawal of a blight complaint against Citibank.
  • Citibank paid ‘big money’ to settle a lawsuit files by Milligan, he said.

An artist’s rendering of the planned Wall Street Place.

Zoning appeal

Citibank and its redeveloper, a company commonly referred to as “McClutchy” but officially named JHM Group, seek to restart construction on Wall Street Place.  It’s been 19 months since Zoning approved their plan to build 151 apartments with 16,000 square feet of retail on the corner of Isaacs Street and Wall Street, and on the land currently occupied by The Garden Cinemas building.

In Lee’s retelling of Milligan’s argument, the appeal partially hinges on what the meaning of the word “and” is.

Milligan’s attorneys argued that the phrase “developments and entitlements” in a building-height-related Norwalk regulation (referred to as Section 13) is “undefined and vague,” making the regulation unconstitutional. They said “and” is conjunctive “so the phrase must be construed as a unitary whole” making it unreasonably difficult for the Zoning Commission to evaluate the project’s suitability.

Lee stated that Milligan’s lawyers, David Rubin and Jonathan Jacobson, “cite no textual or legislative history in support of this argument.” Using “the simplest and most rational reading of the phrase” and then reading the rest of the paragraph “negates” the argument.

Lee viewed other arguments with similar disdain, including an attack on “and/or” in another regulation passage. Milligan’s attorneys also “conveniently” deleted a key word when they quoted the alleged faulty regulation, meaning another argument has “no support in the record or anywhere else,” Lee said.

Finally, Lee tossed Milligan’s accusation of spot zoning by the Commission, saying that neither the zoning nor the proposed use of the site changed, and the regulation covers the entire Central Business District, not a small lot of land.

With the decision, “The City’s efforts to revitalize the Wall Street neighborhood took another step forward,” said Norwalk Director of Communications Michelle Woods Matthews.

Again, Milligan said he’s undecided when it comes to filing an appeal. He explained:

“On the one hand I am clearly right. The city created an unintelligible unlucky clause 13 to resurrect the disaster Tyvek project from the dead. Clause 13 was a clear case of spot zoning, and it is unconstitutionally vague. It would have been more appropriate for Citibank to apply for a variance than to create an illegal zoning clause.

“On the other hand, I kind of want to see what the McClutchy’s {sic} will do. I don’t think they have any intention of building this project. If I do not appeal than {sic} the McClutchy’s {sic} will have no more excuses for not building their project.

“I will be deciding in the next couple of weeks on whether to appeal this decision or not. We shall see.”

 

JHM’s attorney, Peter Nolin, declined to comment.

Woods Matthews said:

“Superior Court Judge Charles Lee’s ruling is the third lawsuit brought by Jason Milligan against the City to be dismissed. This is the latest in a series of decisions that have found no merit in Milligan’s attempts to stop this project from moving forward. On behalf of Norwalk residents, the City ​and Redevelopment Agency will continue to work hard to move this project forward as planned.

“More than two years ago, the City and Redevelopment Agency went through a public process and negotiated changes to an existing development agreement with the developer, JHM Group and the current property owner, Citibank, that would allow for the new Wall Street Place Project to move forward.

“Now that these lawsuits are behind us, City leaders are eager to work with JHM Group and Citibank on next steps.”

Murals in the Leonard Street parking lot, owned by real estate broker Jason Milligan. The City and Norwalk Redevelopment Agency seek to overturn Milligan’s 2018 purchase of the property.

‘Resolved’ before New Year’s?

What were the other two lawsuits?

“Earlier this year, the Court dismissed a lawsuit that was contentiously litigated by the parties for years which Mr. Milligan filed to try to invalidate the underlying Redevelopment Plan,” Woods Mathews explained.

Judge Sheila Ozalis granted what’s called “summary judgment” in that lawsuit, although Milligan is among those who acknowledge such a decision is highly unusual in Connecticut. Corporation Counsel Mario Coppola, speaking recently to the Board of Estimate and Taxation, called the ruling “pretty extraordinary for a case of that significance.”

Milligan has filed an appeal.

The other “lawsuit” Woods Matthews cites is a motion in what’s typically called “the main lawsuit:” Milligan was sued by the City and the Norwalk Redevelopment Agency for buying five properties slated to be used for POKO Phase II.

The contention zoomed skyward and legal papers increased geometrically in April 2021 when Judge Sheila Ozalis, who took over when Lee was forced to retire, allowed the plaintiffs to add various POKO legal entities and the widow of late POKO principal Ken Olson as defendants in the case.

That’s added complications and Ozalis recently pushed the trial forward from September to March, marking the third court date extension in just over a year.

“The good news is that Judge Ozalis ordered we all attend mediation prior to November 30th,” Milligan said in an email. “I am optimistic we can find a resolution. I am eager to try to resolve things through diplomacy. Everyone would be so much better off, and it would happen so much sooner.”

Artwork funded by Jason Milligan, in close proximity to Wall Street Place.

Before the mediation, Ozalis will hear arguments on the City and Redevelopment Agency’s motion for summary judgment, a request that she decide the case without a trial.

Milligan takes issue with a prediction recently made by Coppola in May that the lawsuit will be “resolved within the next year,” maybe before New Year’s.  “There is an end in sight with regard to the litigation,” Coppola said to the BET, adding that “every substantial decision has been in our favor.”

“The only way that all the lawsuits will end ‘soon’ is if we settle them,” Milligan said. Otherwise, he predicted “a Jury trial with lots of witnesses,” although the plaintiffs have objected to his request for a jury trial and Ozalis has yet to rule.

The City and Redevelopment Agency are demanding $4.5 million to settle the lawsuit, Milligan’s attorneys said in documents filed Wednesday.

Milligan could have paid just under $2 million to end the lawsuit in March 2020 but turned down that offer of compromise. Mayor Harry Rilling said at the time that the City didn’t expect Milligan to take the offer.  It was extended just before 18 months had passed since the complaint was filed, meaning that Milligan will be charged 8% interest on the proposed settlement sum if the court finds in the City’s favor.

Milligan alleged last week that the City needs “some self-reflection” because it “has plenty of blame to take.” He said, “The best path forward is for all parties including Citibank and McClutchy coming together solve this.”

Coppola, speaking to the BET in May, said that while some citizens believe that McClutchy can’t move forward with finishing Wall Street Place until the major lawsuit is resolved, the only Milligan lawsuit impeding McClutchy/JHM is the zoning appeal.

 

Construction on Wall Street Place, left, halted in mid-2016 when developer POKO Partners ran over budget. In the right foreground is the former Leonard Street municipal lot. Real estate broker Jason Milligan bought it from Rich Olson of POKO Partners, although the Norwalk Redevelopment Agency said this would violate the Land Disposition Agreement for the property.

Blight fines?

A 2020 photo of Wall Street Place. (Jason Milligan)

Milligan has another bone to chew.

“Were you aware that the City suddenly and quietly withdrew the blight lawsuit against the Tyvek Temple?” he wrote June 1.

In late 2018, with Wall Street Place deteriorating two years after construction stopped, the City issued a blight warning letter to Citibank, spelling out a possible $100 a day fine if the blighted condition wasn’t corrected.

“Did the City recover the nearly $200,000 in fines?” Milligan asked. “I confirmed that the property was still blighted as of the time the case was withdrawn and I have seen no visible improvements since then.”

He contended that the lawsuit “was leverage to get Citibank to keep that site somewhat clean and orderly.”

“That lawsuit was withdrawn as a matter of procedure,” Coppola said to NancyOnNorwalk. It was filed “to obtain injunctive relief for potential violations of zoning and blight just in case” Citibank “did not move forward with obtaining the necessary local approvals to move forward with completing the construction at the project.”

When Citi and McClutchy won the necessary approvals for the new project plan 19 months ago the “concern was resolved,” Coppola said. Now, Milligan’s appeal “is the only reason” McClutchy can’t start construction. If not for the appeal, “our understanding is that the owner would have commenced construction at the project last year.”

“What will McClutchy use as an excuse if I don’t appeal the zoning decision?” Milligan asked Saturday. The company has a timeline with deadlines to meet, he said, suggesting that McClutchy might default like POKO did.

“Tick Tock,” Milligan said.

 

Jason Milligan paid a $4,000 fine for demolishing part of 20-26 Isaacs St. without proper permitting, according to Norwalk Chief Building Official Bill Ireland. He would have had no problem getting a permit if he’d applied, Ireland said.

#Winning

So Milligan has had a very unusual summary judgment go against him and his challenge of Citibank’s zoning approval was just denied.  What legal victories can he list?

“I would prefer not to highlight my legal success because then the mayor and Mario get upset,” he said.

However, he said Citibank paid him “big money” in the settlement of the lawsuit he filed challenging an easement between Wall Street Place and Milligan’s property, the Fairfield County Bank building.

“They trampled my rights and my predecessor, Fairfield County Bank, supported my position,” Milligan said.

Citibank reps did not reply to an email asking about the settlement.

And although he lost that summary judgment ruling in the Wall/West plan challenge, Milligan called the case “favorable to me.’

“The two consultants in the case paid me a lot of money to settle that case. The main case is still pending appeal,” he wrote.

He also pulled a 2016 case out of the woodwork when he said he “came out on top with the library litigation.”

In 2017, the City paid Milligan $460,000 for a six-year purchase option for his Belden Avenue property next to the Norwalk Public Library as a settlement to the Library Board Foundation’s legal challenge to Zoning’s approval of Milligan’s plan to build apartments there.

‘Dozens of exciting new tenants’

Real estate broker Jason Milligan speaks to a Norwalk Assistant Parking Director James Emery at the City’s Wall Street improvement project design kickoff, June in the Wall Street Theater. The Department of Transportation, Mobility and Parking (TMP) provided purple t-shirts to City employees and volunteers involved in the project, so that citizens would know who to ask questions of. Milligan donned one over his shirt.

“The City has pretty consistently been suing me since 2015. In that same period of time, I have bought half of downtown Norwalk and I keep churning out projects and moving dozens of exciting new tenants into the area. I have built and renovated more residential, retail, office & boutique manufacturing units than anyone else,” Milligan said. “I have also paid for close to 100 pieces of public art to be created in the area.”

Milligan owns about 40 properties in the Wall Street area.

His new tenants include Mr. Mango, a smoothie purveyor, and a bubble tea merchant. A thrift shop has opened next to the new Ecuadorian bakery in the former My Three Sons building. He spoke of building a hotel over My Three Sons but Planning and Zoning denied the plan as not in compliance with parking requirements.

Milligan provided a “short list” of tenants, without doing research:

  1. Hype Room
  2. Mr. Mango
  3. Bistro 83
  4. Salon by Julia
  5. Just Dance
  6. Mad Lab
  7. Nutty Bunny
  8. Rebel Daughter Cookies
  9. Arc Electric & Lighting
  10. Norwalk Conservatory
  11. At top, the former David Harvey Jeweler’s building, bought by Jason Milligan nearly two years ago. At bottom, an artists rendering of his plan for the property, showing him waving from the top floor balcony. It’s “difficult to get approved because of the complicated regulations,” he said. “I will either do a scaled back project or wait for the new zoning regulations. If I have no other projects going on then maybe I will endure the pain and expense to get it approved with the existing rules.”

    Juice Digital Media

  12. Space 67
  13. Bubbly’s Bubble Tea
  14. Sabor Ambieteno – Byron Bakery
  15. Wowww Nails
  16. Thrift Vintage Clothing
  17. Peruvian Restaurant-Coming Soon
  18. Cordial Dental
  19. EIR NYC, LLC hand sanitizer & body wash
  20. Odin Therapy
  21. Kengos LLC
  22. Aflac
  23. Young Life
  24. Gotham Digital
  25. Rita Jags Softball
  26. East Hill Cabinetry
  27. One Origin (Artificial Intelligence)
  28. Strategic Micro Systems
  29. Mad Bulls
  30. Blair Tugman
  31. Sound Credit Union
  32. Manchester Legend
  33. Several law practices, psychology or psychiatrists, CPA’s

 

Real estate broker Jason Milligan talks to Norwalk Chief of Staff Laoise King at the City’s Wall Street improvement project design kickoff, June in the Wall Street Theater.

“I am more than happy to discuss and promote all of the other successful things I am doing in the area,” he wrote. “Of my many successes, getting the Norwalk Conservatory performing arts college to agree to a 10-year lease in the center of Wall Street may have the largest impact on the area. Their recent 2-week camp was an amazing boost of energy.”

The Norwalk Conservatory has rented four floors in one of his Wall Street buildings, Milligan said, without identifying which one. It’s also bought property on East Avenue to renovate into a dorm and “has forged partnerships with several Wall Street area businesses that have synergy including the Wall Street Theater, Juice Digital Marketing, Just Dance-dance studio, and others.”

Milligan said:

“My strategy is working amazingly well. I have 3 properties in the Wall Street area under contract right now that should close toward the end of August, and I am negotiating on a 4th.

 “The property acquisitions will knock yours and Laoise King’s socks off.

 “Add that to the 6 ongoing mixed use projects in the area! I am the Redeveloper of Wall Street whether I am officially recognized or not.”

IJ vs zoning commission 22-0722 decision

12 comments

David Muccigrosso July 26, 2022 at 7:14 am

I love Milligan’s style, but the substance is increasingly being Overcome By Events.

I don’t blame Jason for refusing my friendly advice, but I’ll offer it once again: Cut bait on Wall St., and focus on SoNo. There are SO MANY properties here that could use a developer/landlord who actually cares about building up this area, and there’s SO MUCH potential and “good things already going for us” that it will be less of an uphill climb.

The fundamental problem with Wall St. is that the Rt.7 connector and West Ave. have essentially trifurcated Downtown. For those particularly familiar with Strong Towns, West Ave is a “stroad” of the worst kind – it’s a road too fast to be viable for pedestrian traffic, and yet it’s also expected to function as the core street for pedestrians to access dozens of businesses. Anyone who’s tried to cross it knows in their heart what I’m talking about! Fundamentally, we just can’t expect a roadway to be two things at once – a route for fast travel AND the core of a neighborhood. We can’t have our cake and eat it too!

If we REALLY want to revitalize Downtown, West Ave needs to be narrowed and have that land returned to frontage or developable space for existing buildings. It would calm traffic to a level similar to North Main in SoNo, providing the foot traffic that people like Byron need for his bakery. But that’s just not the kind of project Jason can make happen all by his lonesome.

Jason Milligan July 26, 2022 at 7:40 am

“That lawsuit was withdrawn as a matter of procedure,” Coppola said to NancyOnNorwalk. It was filed “to obtain injunctive relief for potential violations of zoning and blight just in case”

“Just in case” Citibank continued to let the Tyvek Temple rot?

Mario let Citibank off the hook for $200,000 “as a matter of procedure”?

Huh!?

It is still blighted & a blighting influence on the neighborhood!

Jason Milligan July 26, 2022 at 8:09 am

The library legal battle was not “out of the woodwork”. That obnoxious lawsuit brought by the City / Mario against my perfect project was the start of all our problems.

I applied for and received approval for an “as of right” project. It was to located on my private property. It was by the book. I requested zero money or assistance from the government or tax payers.

The lawsuit was brought for right ahead of an election for what seemed like political reasons.

If the library issue was handled differently/ better than we would not be where we are!

Piberman July 26, 2022 at 11:12 am

Anyone have an idea of the City’s total legal bill on “redevelopment activities” in our shabby Downtown and how it compares to similar sized cities in CT ? Litigation seems a major feature of City revitalization efforts.

Will Downtown ever get a real office building like all the other CT cities ? Or will our Downtown continue to be mostly apartment buildings and some small shops with a few eateries ?

The idea that attracting major businesses bringing good jobs never seemed to gather much “head of steam” in Norwalk. We continue to have a 10% Poverty Level and remain a “Big Box Powerhouse” with its low pay/low tax. Without attracting good jobs our 10% Poverty Rate will continue. Surely in a City with per capita income matching CT itself we ought do much better revitalizing our Downtown with good jobs.

Dagny July 26, 2022 at 12:15 pm

Quote Poem by Edgar Guest
Success is failure turned inside out
The silver tint of the clouds of doubt
You can never tell how close you are,
It may be near when it seems so far:
So stick to the fight when your hardest hit
It’s when the things seem worst
that you must not quit.

Keep going, Wall Street ReDeveloper! Business by business, property by property progress us evident!

David Muccigrosso July 26, 2022 at 12:45 pm

I just want to take this special moment of silence to commend @Piberman’s achievement of managing to not blame renters for once.

*bows head, stares at shoes solemnly; opens a flask and pours one out for all the fallen landlords*

However, as the Loyal Opposition, I submit that his suggestion – a big office building – would only further turn Downtown into a pedestrian deadzone *without* traffic calming on West Ave. What would actually end up happening is that the offices get built, along with a huge new parking garage, and the increased high-speed (30mph+) car traffic on West Ave drives away pedestrians and creates traffic snarls on the side-street entrances. The initial commercial tenants would eventually stop being able to attract talent, as no one would want to play real-life Frogger on their lunch breaks. The offices would sit half-full with whatever regional players might muster the cash to lease them out, while the landlord refuses to lower commercial rents to reflect his true market value, instead waiting and speculating on selling his property to the next round of gentrification.

I think the big difference between what I’m calling Piberman’s “paleocon” view and mine is that I see Downtown as an ecosystem where the office building is a reflection of how successful the area already is, while he sees it as something you can just plop a building down and business magically materializes – “if you build it, they will come”. Sure, it works for baseball fields, but Manhattan wasn’t built in a decade, folks.

Personally, I think the traffic calming is what fixes this. With 2 downtown exits and barely 3/4 mile of West Ave between them, it doesn’t appreciably ruin anyone’s commute to slow the street down from ~30mph to 15-20mph. West doesn’t even run at full capacity during *rush hour*; why did anyone ever think it needed to run so fast to begin with, right? But what slowing it down DOES do is make it a pleasant place to work. No one’s afraid to cross the street to drop off their dry-cleaning, or have lunch at the local bakery. No one’s afraid to *walk* to work from the various apartments that are *already there*.

Notably, Harry’s recently-approved project with all those curbs does *literally nothing* to fix traffic on West; he and the establishment are doubling-down on the status quo which thinks West isn’t the problem, and thinks they just need to put more crosswalks into an area (Wall) where traffic’s already far calmer than on West.

Anyways, not to sound like a broken record here, but you know which area’s ACTUALLY ready for a big office building? SoNo! If I were Harry and wanted to make a big office building deal, I’d stop this mad dash to build high-rise apartments (seriously, is he not tired after the first 20?!?), and start looking greedily at the dozen or so vacant and underutilized lots between Main and Water south of Washington. Give the commuters a nice shiny mini-skyscraper to stare out at from their balconies, and wonder why they’re bothering to commute 3 hrs a day when they could just work for whichever suckers Harry lures in to the project and have plastered their huge logo on the side of the building (hopefully, it’s an entertainingly phallic one, but beggars can’t be choosers). The bonus is that those commuters now start spending those 3 hours spending their hard-earned money around the neighborhood!

Either that, or @Piberman, I’d just recognize that Harry’s already building office towers, they’re just not where you think they should be: Merritt 7. Yes, I know, I don’t think they should be there either. It’s insane! All that concrete should have gone INTO Downtown, not a mile NORTH of Downtown.

matthew merluzzi July 27, 2022 at 10:42 am

There’s a lot of history in the Wall Street area that should be embraced and built upon.

Mario Coppola July 27, 2022 at 11:12 am

Over the past few years, Mr. Milligan has made numerous false and defamatory statements regarding me in the public domain and he unfortunately continues to do so here.

Mr. Milligan stated that the library lawsuit was “brought by the City/Mario against my perfect project was the start of all our problems.” As I have informed Mr. Milligan multiple times in the past, I never had anything to do with that lawsuit which was brought by the independent Library Board and I did not encourage the Library Board to file the lawsuit.

Mr. Milligan stated “Mario let Citibank off the hook for $200,000 as a matter of procedure”. That is not true. I have not taken any actions to reduce any blight fines issued against Citibank. Mr. Milligan referred to a lawsuit that was filed against Citibank to obtain injunctive relief for potential violations of zoning and blight. That lawsuit was properly withdrawn at some point because approximately two years ago Citibank received approval from the Common Council and Redevelopment Agency for the new project, and over 18 months ago Citibank received approvals from the Zoning Commission for the new project. Once Citibank received its approvals, there was no need to seek injunctive relief regarding any potential blight and/or zoning violation. Ironically, Citibank and the JHM Group have been unable to move forward with the new project to date due to Mr. Milligan’s appeal of the Zoning Commission approval.

Patrick Cooper July 27, 2022 at 4:05 pm

Define irony: Mario Coppola claiming the “high moral ground”. Riiiiight.

Here is a fact: Norwalk will become an immeasurably better governed city once Harry is defeated, and Mario is fired and gone.

The only additional improvement would be to blackball the entire Berchem-Moses firm from so much as placing a single fingerprint on any future Norwalk business. Mario is one thing, but Ms. Moses is truly despicable.

Jason Milligan July 28, 2022 at 6:07 am

Mario,

I quoted you from the article.

You are the CHIEF attorney. Who besides you directs legal strategy?

Bottom line is the Tyvek Temple is one of the few legitimate instances of blight in the Wall Street area and they were legally let off the hook for nearly $200.000!

Hard to believe that happened without the Chief Attorney knowledge or consent…

Justataxpayer July 28, 2022 at 11:05 am

I found a typo in the article.

“Milligan is, of course, embroiled in multiple lawsuits with the City”

Should be one of two edits
“Milligan is embroiled in multiple lawsuits with the City”.

or
“Norwalk is, of course, embroiled in multiple lawsuits with any developer that isn’t a lockstep Democrat”

Tysen Canevari July 31, 2022 at 7:32 pm

It is unfortunate for Jason Milligan that Mario Coppola does or says what he wants because he and Harry have each others back.Imagine if our homes had blight and we were fined. Would they just eliminate the fine? Doubt it.

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