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Developer Countersues Bethune-Cookman

February 13, 2018
 
 

The developer that built a controversial dormitory for Bethune-Cookman University is countersuing the institution in an attempt to receive payments it says it is owed.

Quantum Equity filed suit in Volusia County in Florida Monday, according to documents provided by a legal and crisis communications firm that is also representing the businessman previously identified as the developer's managing partner, Darnell Dailey. The firm also provided a statement denying claims made in a lawsuit Bethune-Cookman filed last month, saying the suit wrongly groups the developer with former university administrators and a broker accused of fraudulent activities.

Bethune-Cookman sued the developer and several former university officials, alleging improper payments were made to BCU officials as the price tag of the dormitory spiked.

But on Monday, the developer pushed back on the much-discussed idea that the project is costing the university $306 million. It issued a three-page statement calling past public discussion of the project's cost “grossly misleading.”

“Just like a home purchased on a 30-year mortgage, at the end of the payment term the total cost of the home is well above the stated purchase price,” the statement reads. “Moreover, the net 'cost' of the Sublease to BCU is zero because the room revenue more than covers the rent.”

The facility in question cost $85 million to build, according to previous reports.

Quantum is compensated for its work by sharing payments made by Bethune-Cookman, the statement continued. Therefore, the developer's interest is tied to the university's financial security and ongoing operation, it said.

The statement also argued Bethune-Cookman's financial and governance troubles are “largely independent” of the dorm project, which is designed to be self-supporting.

The lawsuit seeks possession of the dormitory; damages including rent, late charges and interest; the appointment of a receiver to collect rent or run the dormitory business; and an injunction requiring Bethune-Cookman to direct students to fill the dorm in question before leasing them space in other dormitories.

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