Lauderdale Man's Anticipated Hefty Payday On Pending Sale Of Small Beach-Area Property To Hotel Developer Hits The Rocks When Activist Neighbor Files Request Asking City To Slap Historic Landmark Designation On 79-Year Old Structure & Keep Wrecking Ball Away

On Fort Lauderdale Beach, Florida, the South Florida Sun Sentinel reports:

• A beach property owner is being told his home is not his castle, and he can't do with it as he pleases. The reason: one of his neighbors has sought protected status from the city for the 79-year-old structure.
  
  Owner James Ostryniec does not want a historic landmark designation slapped on the Villa Torino apartment building he has a contract to sell. But that did not stop neighbor Charlie Esposito from paying a $650 fee for the city's Historic Preservation Board to consider the matter.
  
  The board agreed Monday that the 1936 Art Moderne structure at 3017 Alhambra St. is architecturally significant and recommended on an 8-1 vote that it be protected, which means any alterations would require the board's approval. The recommendation goes to the City Commission, which has the final say.
  
  Esposito said somebody had to step up to protect the city's history and property owners of older buildings should be aware of that possibility.
  
  "That's a risk you take as an owner, when you have a piece of property like that," said Esposito, who lives on the street behind the building. "I think properties need to be preserved, We can't just tear everything down."
  
  Ostryniec wrote to the board that his property "is not of any historically important style" and has gone through numerous renovations: from a two-story duplex to a nine-room motel to a five-unit apartment building. He called the filing a "ploy" to prevent his property from being sold to a hotel developer. It will also harm his family financially.
  
  OTO Development hopes to build a 10-story, 175-room AC Hotel by Marriott on Alhambra Street, using the Villa Torino and two other properties for the project.
  
  One of those properties, Casa Alhambra at 3029 Alhambra St., was also on the preservation board's agenda for historic designation, but the owner of that 1936 home demolished it last month, catching neighbors by surprise. The other has a 1938 building on it by noted architect Courtney Stewart, who was also responsible for the Coca-Cola bottling plant on Andrews Avenue.
  
  Beach resident Abby Laughlin, who encourages preservation of older properties with historic value, didn't support giving the historic designation to Villa Torino. She said the city has no policy in place to compensate Ostryniec for the lost value of his property.(1) She fears historic preservation is being used as a weapon in a development war.
  
  "A designation should not be placed on a property without an owner's willingness," beach resident Karen Turner said.
  
  However, preservation advocates nationally say acting without an owner's consent may be the only way to prevent a historic resource from falling to a wrecking ball.
  
  Beach resident Steve Glassman knows the challenge. He filed the historic designation request for the Lauderdale Beach Hotel and was successful in having its facade preserved in 2002.
  
  Glassman, president of the Broward Trust for Historic Preservation, doesn't think Ostryniec is being harmed. The historic designation may keep him from making millions by selling to a hotel developer, Glassman said, but it won't prevent "reasonable use of his property." "You're entitled to make a reasonable profit," Glassman said. "Are you just all of a sudden entitled to hit the jackpot?"
  
  Preservationists say development and history can co-exist, pointing to the planned Gale Boutique Hotel and Residences. The project includes a new condominium tower along with a restored Escape Hotel, which opened in 1951 and was the first hotel on the beach with a pool.
  
  Preservation board members say city rules allow non-owners to request property designations and the board has to look at the merits of the case.
  
  Representatives for Ostryniec argued the building didn't have any recognizable historic value. But Board Chairman David Kyner told them this wasn't, "Paris, Venice, Rome," it is Fort Lauderdale where there are "very few star buildings."
  
  Kyner said the windows at sharp corners, the building's striping and asymmetrical chimney help identify it as a fine Art Moderne example.
  
  "There are a lot of things that to me look easily identifiable, even to a lay person," Kyner said.

Source: Historic label derails owner's plan to sell '36 home.

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(1) If the city commission agrees with the Historic Preservation Board and votes to slap the property with historic designation status, and assuming the landowner can demonstrate that he has been denied all or a substantial portion of the beneficial uses of his property as a result of said status, the landowner may have to resort to an inverse condemnation lawsuit (a burdensome process) against the city in an effort get the city to compensate him for his economic loss.

See Joint Ventures, Inc. v. Dept. of Transp., 563 So. 2d 622 (Fla. 1990):

• Generally, the state must pay property owners under two circumstances. First, the state must pay when it confiscates private property for common use under its power of eminent domain. Second, the state must pay when it regulates private property under its police power in such a manner that the regulation effectively deprives the owner of the economically viable use of that property,[6] thereby unfairly imposing the burden of providing for the public welfare upon the affected owner.[7]
  
  
  ***
  
  Although regulation under the police power will always interfere to some degree with property use, compensation must be paid only when that interference deprives the owner of substantial economic use of his or her property. In effect, this deprivation has been deemed a "taking." Agins v. City of Tiburon, 447 U.S. 255, 260, 100 S.Ct. 2138, 2141, 65 L.Ed.2d 106 (1980); Penn Cent. Transp. Co. v. City of New York, 438 U.S. 104, 138 n. 36, 98 S.Ct. 2646, 2666 n. 36, 57 L.Ed.2d 631 (1978). Thus, when compensation is claimed due to governmental regulation of property, the appropriate inquiry is directed to the extent of the interference or deprivation of economic use.

See also, Shands v. City of Marathon, 999 So. 2d 718 (Fla. 3d DCA 2008):

• In an as-applied taking claim, the landowner challenges the specific impact of the regulation on a particular property.
  
  The standard of proof for an as-applied taking is whether there has been a substantial deprivation of economic use or reasonable investment-backed expectations. Taylor, 659 So.2d at 1167.
  
  This requires a "fact-intensive inquiry of impact of the regulation on the economic viability of the landowner's property by analyzing permissible uses before and after enactment of the regulation." Id. at 1174 n. 1; see, Penn Central Transp. Co. v. City of New York, 438 U.S. 104, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978); see also Palazzolo v. Rhode Island, 533 U.S. 606, 617, 121 S.Ct. 2448, 150 L.Ed.2d 592 (2001) ("[w]here a regulation places limitations on land that fall short of eliminating all economically beneficial use, a taking nonetheless may have occurred, depending on a complex of factors including the regulation's economic effect on the landowner, the extent to which the regulation interferes with reasonable investment-backed expectations, and the character of the government action"); Glisson v. Alachua County, 558 So.2d 1030, 1037 (Fla. 1st DCA 1990) (holding that diminution in value of the property is not the test, rather, it is incumbent on the landowner to demonstrate that he has been denied all or a substantial portion of the beneficial uses of his property.); Golf Club of Plantation, Inc. v. City of Plantation, 717 So.2d 166, 170 (Fla. 4th DCA 1998) (overview of federal takings analysis).

See also J. Sackman, Nichols' The Law of Eminent Domain § 6.09, at 6-55 (rev. 3rd ed. 1985) ("The modern, prevailing view is that any substantial interference with private property which destroys or lessens its value ... is, in fact and in law, a `taking' in a constitutional sense."