A dispute between two developers has put a $37 million project in downtown Tinley Park in the lurch between construction phases.

Boulevard Development LLC, co-owned by real estate developer Robert Hansen and auto dealership owner Joseph Rizza, inked a development agreement with the village in Chicago’s south suburbs in 2019 that included almost $8 million in incentives, including tax increment financing, to construct a two-building, mixed-use project that would include 165 apartments and about 30,000 square feet of retail space.

Now, the project is halted between phases due to disagreements between the developers, and Hansen is suing Rizza and seeking to dissolve the company, according to a lawsuit filed in Cook County court.

The company built the first phase of the project, dubbed the Boulevard at Central Station, that was to include two four-story apartment buildings with about 30,000 square feet of ground-floor retail space at 6701-6755 South Street.

The company, which has also operated under the name South Street Development LLC, was supposed to begin construction on a second building that would be virtually identical to the first in October, but Hansen and Rizza became deadlocked due to disagreements over company operations, including whether to even proceed with the second phase, according to the lawsuit filed earlier this month. Hansen’s attorney didn’t respond to a request for comment. Rizza didn’t return requests for comment.

Boulevard received an incentive package of more than $7.5 million from Tinley Park, according to published reports, which also show that the project has been in the works for more than a decade. Boulevard has owned the land for more than 20 years, according to the suit. 

The estimated cost of the project is $37 million, according to the development agreement. A village spokesman declined to comment on the suit.

The company is in “imminent” danger of losing about $500,000 in tax increment financing from the village under the terms of the development agreement, with Hansen responsible for half of that loss, according to the suit.

All of the apartments in the first building have been rented, though the commercial space has not yet been leased, according to Hansen’s lawsuit. Whether, or how, the second phase of the project will be built is unclear.

In the suit, Hansen’s attorney said Rizza failed and refused to authorize the company to seek financing for the second phase of the project, proceed with construction or retain a general contractor, which were breaches of fiduciary duty that led to the village notifying Boulevard that the company is in default of its tax increment financing agreement.

Hansen adopted a resolution to dissolve the company due to irreconcilable differences between the managers, which Rizza allegedly refused to acknowledge. Hansen is asking the court to declare the company dissolved and to appoint a receiver to close out the business’ operations and sell its assets, including the contract with the village to complete the project’s second phase.

A filing shows that a court date has been scheduled for June 12.