Wow, RG4N just filed a lawsuit against the city of Austin
So RG4N just filed a lawsuit in Travis County District Court against the City of Austin and Lincoln Properties. For those that are new to this whole controversy, Lincoln Properties owns the real estate that Walmart is leasing and building a 200,000 sf mega store on. It's not a normal Walmart but some kind of crazy Walmart on steroids 2 story mega store. Additionally, Lincoln and Walmart are tied at the hip. Basically Lincoln Properties finds real estate in Austin for Walmart and tries to pave the way for them to move into a neighborhood usually, being Walmart, over neighborhood opposition.
There has been a lot of talk that if the city does not approve the Walmart plan that Walmart would come in and sue the city. Most of this talk is based on, well, Walmart saying they are going to sue the city. RG4N is a neighborhood opposition group of people mostly in the surrounding neighborhoods. Apparently unhappy with the argument given that the city has to approve the Walmart plan or it will get sued, RG4N decided that they would sue the city instead.
So what is the basis of the suit? According to RG4N, part of the process for large real estate redevelopments is a notification to surrounding neighborhoods so that they give input on their concerns. Apparently, this did not happen with the Walmart plan. The other contention is the traffic analysis. For a development to be approved there has to be a traffic analysis to show that the new site will not overload existing roads. Walmart did a traffic study using data from about 10 years ago. Based on this information the site gets graded on an A through F ranking. Walmart got a D but basically D translate to approval. RG4N argues that the data Walmart used is outdated and that based on current traffic load that the new building will fail.
In addition to all the lawsuits and potential lawsuits, some other interesting developments have been going on. Walmart lawyer Richard Suttle recently surprised people by retiring in the middle of the project. In addition to that, Walmart has been doing pretty poorly recently in the market place. I have a graph below which compares Walmart's stock price to the Dow Jones for the last year. In April, Walmart posted its worse sales ever since it started keeping track back in 1980. Ouch. Apparently same store sales fell 3.5 percent from April of last year falling short of a predicted 2 percent drop in sales. This comes after Walmart tried to go after more middle and upper class consumers, which has been seen as a failure. Walmart has announced that it would cancel some of its new store plans. There was no word on whether the Austin location would be included in the canceled plans.