A developer must pay the D.C. Attorney General’s office $300,000 to settle allegations of “blockbusting” to try to turn a MacArthur Boulevard duplex into condos and force out an owner.

“The tactics deployed by the defendant harken back to the type of overt discrimination that occurred more than 50 years ago,” Attorney General Karl A. Racine said in a September 20, 2022 statement. “It’s outrageous and illegal and has no place in the District of Columbia or our country.”

A plan by Hossain Kamyab of  Polygon Holdings to turn the 4457 MacArthur Blvd. half of the duplex at the east end of the Palisades into eight or nine condos hit headwinds in early 2021. The Equal Rights Center, a civil rights organization, told ANC 3D commissioners that a sign posted in the yard that advertised “Section 8” coming soon appeared to use the name of the low-income housing program as a scare tactic to devalue the neighboring property. The sign also advertised housing for students.

“Blockbusting refers to the practice of real estate speculators encouraging and manipulating real or perceived prejudice in prospective buyers in order to reduce the market value of a desired property,” according to the settlement. The deal was reached without admission of liability on the part of Kamyab or Polygon, according to the document.

Yard signs aside, ANC 3D Commissioners had voiced concerns that the condo conversion would overwhelm the immediate neighbor. The dwelling, built about 120 years ago, shared a basement and attic, residents said. The conversion plan required exceptions to city zoning rules.

The settlement alleges that the developer intended to acquire both halves of the duplex to convert the entire site to condos.

Polygon Holdings bought the adjoining 4459 property for $1.3 million in February 2022, according to city records. The 4457 property was recently listed for sale for $1.4 million.