Posted by: Patricia Salkin | January 7, 2019

NY Appellate Court Holds Highest and Best Use of a Condemned Property was as a Yeshiva was Supported by Sufficient Evidence

This post was authored by Matthew Loeser, Esq.

This condemnation proceeding involved seven-acre plot of land, which consisted of six tax blocks. In the early 1980s, the subject property was donated to the claimant by separate donors or sponsors in separate parcels for the purpose of constructing a yeshiva. In 1985, the subject property was mapped as a wetland by the New York State Department of Environmental Conservation (“DEC”). The claimant then applied to the Freshwater Wetlands Appeals Board (“FWAB”) for a hardship exemption from the wetlands designation, which was granted. Although the FWAB issued a decision and order removing any “implied restriction on limiting the Yeshiva’s development to 53,000 square feet in 1991, no development took place. In 2009, the City of New York commenced this condemnation proceeding requesting the Supreme Court to determine the amount of just compensation that should be made to the claimants. Before the Supreme Court, the claimant presented revised plans for development that included additional housing. The court found that the value of the subject property was $10,100,000, and awarded the claimants that sum.

The record reflected that the parties had entered into a stipulation which provided that the site preparation and foundation work for the plans would cost an additional $581,152. Furthermore, according to the claimant’s revised plans for a yeshiva, four of the six tax blocks of the parcel would be developed, and the remaining two tax blocks consisting of 91,227 square feet would remain undeveloped. The City argued that the value of the subject property, based upon a highest and best use of undeveloped property, was $3 per square foot. Additionally, the City contended that even if the claimant’s position was fully accepted, the two tax blocks that remained undeveloped should still be valued at $3 per square foot.

The court found that the claimant established the potential for development of the two tax blocks consisting of 103,608 square feet for a synagogue and offices, 15,000 square feet of classrooms, and 94,200 square feet of housing. However, the weight of the credible evidence was insufficient to support the claimant’s position that its development would include two additional buildings totaling 184,800 square feet for additional housing. The court therefore determined that the highest and best use of the two tax blocks designated for those two additional buildings was as undeveloped land. Accordingly, the court found the two blocks consisting of 91,227 square feet, which would remain undeveloped, should be valued at $3 per square foot, or $607,062. Additionally, the court determined that the two blocks which would be developed, amounting to 103,608 square feet, were properly valued at $39.27 per square foot, or $4,068,686.16. After deducting the foundation work costs and other extraordinary site preparation costs of $1,316,518, pursuant to the stipulation between the partied, the total value of the property was  found to be $3,165,513.

Oakwood Beach Bluebelt-Stage 1 v Yeshivas Ch’San Sofer, 164 A.D. 3d 1453 (NYAD 2 Dept 9/26/2018)


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Categories

%d bloggers like this: