Columbus Center builders short cleanup funds

By Casey Ross, Globe Staff

Developers of the defunct Columbus Center development in Boston have told state officials they are running out of money and cannot afford to pay millions of dollars to clean up the abandoned construction site.

In a letter released today, a lawyer for WinnCompanies and the California Public Employees Retirement System told state officials that their business partnership only has $1.5 million to $2 million in assets remaining, less than half what the state estimates it will cost to restore the property along the Massachusetts Turnpike in Boston.

The lawyer, Adam Hundley of Goulston & Storrs in Boston, acknowledged the shortfall but asked the state to "bear in mind that in addition to the enormous time and effort they have invested in this failed project, the (developers) have already lost in excess of $125 million" trying to build it.

"We understand that there is no perfect resolution that can erase the years of frustrations and losses all of the parties have suffered over the course of this project," Hundley wrote. "However, the (developers) believe that litigation will benefit no one."

Last week the main backer in the $800 million Columbus Center venture, the California pension fund, officially declared the long-dormant development dead after a 13-year effort to get it built, and said it would be winding down operations.

Massachusetts officials are now trying to get the developers to restore parts of the construction area, which they estimate will cost $4 to $5 million. A spokesman today reiterated that the state still expects the developers to pay the full cost of the clean-up, but would not comment on whether it will sue to recover those funds.

The project was to be one of the biggest and boldest in Boston's history, calling for construction of a six building complex, including a 35-story tower, that would have straddled the Massachusetts Turnpike between Arlington and Clarendon streets.

In the wake of its failure, transportation officials said their first priority is to clean up the project's dusty construction lots, which sit adjacent to Bay Village neighbors who have had to live with the stalled project for the past two years. They are also asking the developer to pay for the removal of Jersey barriers they installed that narrow the highway near the project site, among other fixes.

In his letter to the state, Hundley asserted, however, that even if the state does pursue reimbursement in court, it can only collect from the development partnership created for the project, not from WinnCos. and Calpers themselves.

"The (development partnership) has proposed to pay all of their remaining net assets to the (state), which is all the (state) could recover even if it were to prevail in litigation," Hundley wrote.