SHOPPING CENTER VENTURE BEHIND ON TAXES
The founder of a prominent Greensboro commercial real-estate company is suing Greensboro City Councilman Robbie Perkins, his successor, for breach of contract and unfair trade practices. The lawsuit contends that the former partners are embroiled in a “controversy” over a 2005 land deal in Davidson County to build a shopping center that remains saddled with more than a dozen vacant storefronts. Richard Maxwell’s complaint against Perkins, along with codefendants Stanhope M. Johnson and Piedmont Triad Commercial Properties, alleges that the two current partners are refusing to honor a stock purchase agreement through which they acquired Maxwell’s business in 2006. The agreement stipulates that so long as Maxwell remained an independent contractor with Piedmont Triad Commercial Properties, the company would pay $1,500 per month for health insurance and other expenses. Maxwell states that in about 1979, he brought Perkins into the real estate business, and hired Johnson in the 1980s. Perkins was first elected to city council in 1993 and retired in 2005. After a two-year hiatus, he ran again and won the second largest number of votes in the at-large contest for three seats. Maxwell did not return calls for this story. The lawsuit states that over time Maxwell ceded increasing levels of responsibility to Perkins and Johnson, and the two acquired a greater share in compensation and acquired stock. In about 2006, the company founder discussed selling his shares to Perkins and Johnson, making them the sole shareholders.
As part of the buyout agreement, Maxwell alleges that he was guaranteed to receive future commission payments from the Piedmont Triad Commercial Properties related to Vineyard Ventures LLC, a partnership set up by Perkins and others to develop a shopping center adjacent to Childress Vineyards, a tourist attraction owned by former NASCAR driver and racing owner Richard Childress, as part of a land deal worth millions of dollars.
Maxwell’s agreement with Perkins and Johnson commits Piedmont Triad Commercial Properties to pay Maxwell listing shares of real estate brokerage commissions paid by Vineyard Ventures, and a number of other real estate companies, including Greensboro Centers LLC, Signature Partners, Century Partnership, 2205 North Elm Street LLC, 612 Industrial LLC and Shamrock Capital Partners LLC. “Maxwell has found himself in a controversy with Perkins and Johnson regarding their other co-ventures, including most pertinently, Vineyard Ventures,” the lawsuit contends, adding that Perkins and Johnson insisted that Maxwell contribute additional funds to Vineyard Ventures. Starting last December, Piedmont Triad Commercial Properties stopped making payments to Maxwell for his health insurance and other expenses. The lawsuit cites an Oct. 25, 2008 e- mail from Maxwell’s wife stating that the plaintiff was living on a fixed income “since retiring.” A month later, Johnson said in an e-mail to Maxwell that “effective immediately NAI Piedmont Triad will cease expense payments to you. According to the agreement we executed, the payments are to continue so long as you are engaged in the real estate business. I enclose the e- mail you sent declaring that you are retired. A circumstance we have long suspected. Since it is impossible to be retired and engaged in the real estate business at the same time we no longer owe the payment.” The complaint counters that Maxwell’s wife sent an e-mail in response indicating that although Maxwell had retired from Piedmont Triad Commercial Properties, he had not retired from the real estate business generally or from his real estate work for Maxwell Associates, a separate company that he owns. The defendants deny that their refusal to make payments constitutes a breach of the buyout agreement.
The lawsuit alsoaccuses Perkins and Johnson of taking advantage of a relationship oftrust and confidence with Maxwell and of having “breached the fiduciaryduties of good faith, fair dealing and loyalty owed to Maxwell.” Perkinsdeclined to comment about the lawsuit or any of the activities ofVineyards Ventures, but a response filed on behalf of the defendantsstates that the partners did not have a fiduciary duty to one another. Maxwell’slawsuit contends that Perkins and Johnson “attempted to assert theirpower and position with respect to the stock purchase agreement inorder to coerce Maxwell with respect to unrelated ventures, includingVineyard Ventures.” An Operating Agreement of VineyardVentures lists Perkins, Johnson, Maxwell and John H. Stratton III asvoting members with equal shares of 22.5 percent of the partnership. Afifth voting member, Gregory Johns, held a 10-percent share. Theoperating agreement includes no information about specific dollaramounts that each member is obligated to invest. Stratton is aGreensboro-based developer, and Johns is described as a partner ofRichard Childress on the Childress Vineyards website. Theoperating agreement, signed by the five members on June 5, 2005, statesthat Perkins, Johnson and Stratton would serve as initial managers ofthe company. The agreement goes on to say, “The managers herebydelegate to each of the initial managers the power, acting alone, totake all such actions and execute all such documents in the name and onbehalf of the company as such initial manager may deem necessary orappropriate to acquire the company’s property from Childress PropertiesLLC, and to subsequently transfer a portion of such property, to theextent such transfer is part of the same transaction, to T and BDevelopment, including documents associated with the closing of a loanfor purchase of such property.” Davidson County recordsindicate that Childress Properties sold land at the northwest corner ofUS Highway 64 and US Highway 52 to Vineyard Ventures on June 13. On thesame day Vineyard Ventures transferred part of the property to T and BDevelopment, owned by Terry Baker and Becky Laws of Lexington, “for avaluable consideration.” A Holiday Inn is now operating on the tractdeveloped by Baker and Laws. County records indicate Vineyard Venturesborrowed a total of $5 million from Regions Bank to finance theshopping center, first with an initial loan of $1.8 million in June2005, then with a $1.6 million loan to develop Tract 2, and then afinal $1.6 million loan to develop tracts 2 and 3. A prominent signwith a scrolling message board advertises Childress Vineyards, theHoliday Inn and the Shoppes at Vineyards Crossing to southbound trafficfrom Winston- Salem on the four-lane US Highway 52, but the signage atthe complex’s entrance on US Highway 64 lists only the vineyard. One ofthe three stores leasing retail space in the shopping center, Monty’sIce Cream, has staked a banner into the ground to draw traffic off thehighway. The shopping center is not visible from the highway and anundeveloped tract with overgrown grass creates the impression of acommercial strip under construction.
Monty’sIce Cream displays a handwritten sign noting that the store would beclosed for three days and a “for sale” sign. The Mike HelsabeckCollection, a wine store that sells bottles affixed with labelsdesigned by its namesake artist, and Dietz Salon are the ice creamshop’s two neighbors. About a dozen storefronts remain vacant. Thewebsite for Stratton Development, a company founded by one of thepartners, indicates that Phase 3 was expected to be complete in early2008, with retail space on the first floor and 16 condominiumsupstairs, but the overgrown tract is all that exists on the land. Arealtor with Coldwell Banker Commercial Triad Realtors is currentlylisting parcels of the undeveloped land for potential stores or officebuildings. Davidson County tax records indicate that theshopping center is assessed at $3 million, and Vineyard Ventures hasbeen delinquent on its 2008 tax bill for $37,738 for more than twomonths.
Onlythree of the storefronts at the Shoppes at Vineyards Crossing, aDavidson County shopping center owned in part by Robbie Perkins, arecurrently occupied.