The Villas on Antique Row were heralded as a hallmark of the real estate rebound in 2014 when they debuted on long-vacant land along South Dixie Highway in West Palm Beach, but the celebration has soured.

A decade after the first owners moved into the three-story townhomes fronted by gilded antique stores, the homeowners association says residents are facing an estimated $12.6 million in repairs, which, in a worst-case scenario, could mean an assessment on each owner of $221,000.

“There are seven individual buildings, and our contention is that not all have shoddy construction,” said Tim Johnson, who owns two shops in the development and a townhome. “My building has no problems, but they are treating the buildings all the same.”

The disagreements have roiled the small tree-dappled community whose construction in 2014 was thought of as emblematic of an economy and housing market clawing its way out of ruin. Homeowners in opposition to the blanket fee have rallied and hired an attorney. The HOA says mediation in the now more than 3-year-old lawsuit is scheduled for this fall and a trial set for December if that fails.

In correspondence with owners, the Villas on Antique Row Homeowners Association says that it would prefer to get a loan for the millions of dollars in fixes, which would require a vote by owners of the 46 units. Two HOA board members reached did not want to comment for this story, citing the ongoing litigation. A message left for the HOA's attorney was not returned.

Attorneys representing the first-named defendants in the 2021 lawsuit did not return calls for comment. Developer Harry Posin, whose company Label & Co. built the community, declined to comment.

In 2013, however, Posin saw the opportunity that the 4-acre vacant lot along Antique Row offered.

The land had been empty since 2006 when a Goodwill store was razed and built anew in the 5400 block of South Dixie Highway. At the time, another developer had plans for 82 condominiums and townhomes with about 14,000 square feet of shops. But that proposal fizzled as the real estate market tumbled beginning in 2008.

For those who bought units during the early years, prices ranged between about $320,000 and $490,900. Antique Row, which is roughly between Southern Boulevard and Belvedere Road along South Dixie Highway, was seeing signs of a revival in those days with new stores being built, such as the two-story Cedric Dupont Antiques, and new restaurants including the popular City Diner.

In recent years, with a swell of pandemic-spurred home buyers, selling prices for individual townhomes at the Villas on Antique Row have been as high as $1.3 million, according to the Palm Beach County Property Appraiser.

Johnson joined with several other owners in hiring an attorney to, in part, negotiate with the association on the potential $221,000 fee.

He said he fears people will have to move out of their homes during the repairs, which the HOA in its letter predicted will be “invasive, loud, dusty, disruptive and costly.”

Attorney Frank Lynch, who is working with the homeowners opposing the costly assessment, said the HOA overstepped when it suggested everyone share equally in the repair costs when some buildings show little or no damage.

“The repairs do not serve the members as a whole but address specific members and their properties,” he wrote in a letter this month to the HOA. “In many cases, the assessment contemplated on a per unit basis exceeds the purchase price of those units.”

Individual stores, which sit below carriage house-like townhomes, cost as little as $150,000 when they were newly built.

Michael Gelfand, a West Palm Beach attorney who specializes in real estate and association law, said the rules on paying for repairs should be spelled out in the HOA declaration of covenants, which outlines individual owner obligations.

Although dull, he recommends prospective buyers in HOA communities review the covenants before signing a deed. He said unlike condominiums that have statutory guidance on repair language, developers of HOA communities can write their own rules.

“Generally, if the declaration is silent, then each owner is responsible for what they own, they are not responsible for other units,” said Gelfand, noting that construction defect concerns are not unique to the Villas on Antique Row. “This is happening at all price points.”

Lynch points to the declaration for the Villas on Antique Row as evidence that his clients are not responsible for damage at other units. He maintains that the contract says work related to construction defects should be the subject of an individual assessment on the unit owner. To further complicate issues, Lynch says an HOA-approved amendment to the declaration that spread costs burdens across the community did not meet the legal requirement of being approved by all HOA members.

"My clients are not litigious by nature, but feel that their rights are being steamrolled," Lynch wrote in the letter to the HOA.

The HOA says it is confident it will win its lawsuit, which after more than three years now names multiple subcontractors as plaintiffs.

“We are equally disappointed and upset over the magnitude, time and expense inconvenience, and costs to properly fix the defects in our community,” the board wrote in its August letter. “Nevertheless, we are confident that this repair process will enable us to recapture our long-term market values."