Data centers become a litigation category, and lenders stop waiting.

1. Data center siting has moved from the zoning board to the courthouse

Three separate Missouri data center disputes reached a courtroom in September. In Springfield, a developer sued to keep a 120-day moratorium from reaching a project the city had twice confirmed in writing was permitted under its planned-development zoning, arguing the moratorium skipped the plan-commission review, hearing and notice a real zoning change requires (NSI, A.1 LLC v. City of Springfield). In Benton County the same developer is fighting a six-month county moratorium over land he had agreed to buy but not yet closed on (Overhue v. Benton County). And a Cole County judge let a citizen group press its claim that Montgomery County broke Missouri's Sunshine Law when it extended incentives to an Amazon-linked project (Preserve Montgomery County v. Montgomery County).

Outside Missouri, the developer behind a five-building, 4.6-million-square-foot campus near King of Prussia appealed Upper Merion Township's unanimous denial after a short-lived injunction was vacated hours before the vote (MLP Ventures v. Upper Merion Township).

For operators: the Springfield and Benton County cases mark the line that matters. A written, project-specific zoning verification is something to litigate from; a signed but unclosed purchase contract may not be. If a deal depends on a data center use, get the jurisdiction's sign-off in writing before closing, and check whether any incentive package was approved with proper public notice.

2. Lenders are moving from forbearance to receivers

Mack Real Estate Group asked a Denver court for an emergency, ex parte receiver over the 450-unit X Denver apartments, alleging its $170 million construction loan has been in default since it matured in January 2025 (Mack Real Estate Group v. X Denver Ownership). In Chicago, Jovia Financial filed a $17.1 million foreclosure on a South Loop office building after its only tenant, a state agency, terminated for cause over unresolved code violations and a forbearance agreement expired; the loan carries an unlimited personal guaranty (Jovia Financial v. S Indiana Avenue LLC). U.S. Bank filed to foreclose on a 32-unit Aurora complex over a $3.28 million loan months after the borrower's Chapter 11 case was dismissed without a sale or refinancing (U.S. Bank v. 1592 Boston Street LLC).

In Manhattan, Soros Fund Management bought a defaulted $145 million mortgage on 224 West 57th Street, won a $158.7 million judgment and took the building at auction; its anchor tenant is Open Society Foundations, so the tenant's side effectively now owns the building (Soros Fund Management v. Eretz Group).

For operators: silence after a maturity default is not leniency. A code violation at a single-tenant building is a lease risk, not only a compliance item, when the tenant can terminate for cause. A Chapter 11 filing that ends without a sale or refinancing buys months, not a cure.

3. A $24 million ground-rent reset falls on an arbitrator's undisclosed contact

New York's Appellate Division, First Department unanimously vacated an arbitration award that had raised the Carnegie House cooperative's annual ground rent from $4 million to $24 million. While the arbitration was pending, the landowner's counsel had approached the neutral umpire directly about a paid appointment as umpire in a separate arbitration, and his disclosure left that contact out. The court found an appearance of partiality that tainted his later rulings and sent the reset to a new arbitration panel (57th & 6th Ground LLC v. Carnegie House Tenants Corp.).

For operators: in a ground-lease reset, a mezzanine valuation or a joint-venture buyout decided by arbitration, ask each arbitrator for ongoing written disclosure of any contact with the other side's counsel, including offers of work in unrelated matters, not just a disclosure at appointment.

4. Ohio lets a developer sue for delay damages after winning its site-plan appeal

The Supreme Court of Ohio held unanimously that Sheetz may bring a separate damages suit against the City of Centerville after already winning an administrative appeal over a wrongly rejected site plan. Because Ohio's administrative-appeal process cannot award damages, a developer does not forfeit them by leaving them out of that appeal (Sheetz, Inc. v. City of Centerville).

For operators: when a site plan or permit is wrongly refused, keep a contemporaneous record of carrying costs and lost revenue from the date of refusal. In Ohio, the right to recover them now survives the zoning appeal.

5. REIT securities suits: one dismissal, one follow-on

Judge George H. Wu of the Central District of California dismissed, without prejudice, a proposed class action claiming Alexandria Real Estate Equities misled investors about its life-science portfolio before large impairment charges. The complaint did not adequately allege the intent or severe recklessness the securities laws require (Hern v. Alexandria Real Estate Equities). Separately, investors in two non-traded hotel REIT funds sued Phoenix American Hospitality about three months after the SEC settled fraud charges over claims that a fund owned as many as 11 hotels when, until January 2024, it held only a preferred equity interest in one (Proven Business Skills v. Phoenix American Hospitality).

For operators: a stock drop after an impairment is not, alone, a fraud case. An SEC settlement is different: it hands private plaintiffs a detailed complaint to build on. Asset-level statements in retail offering materials deserve the most scrutiny.