Friday, May 18, 2012

NYC Cuts New Deal To Redevelop Willets Point With Mets Owners

New York City has cut a new deal to redevelop Willets Point with the Mets ownership group. Willets Point has long been eyed for redevelopment. It's a neighborhood that is largely off the grid - it lacks sewer hookups and is a warren of junkyards and repair shops in the shadow of the gleaming new CitiField. Since construction got underway to build the stadium a few years back, Mayor Bloomberg had looked to get the redevelopment going.

Those efforts had stalled until now.
A new deal between the Bloomberg administration and a group of developers, including the owners of the Mets, will call for the remediation and redevelopment of a 20-acre area of the blighted neighborhood next to Citi Field, adding retail and ultimately new housing in a time frame that extends past an initial proposed 10-year plan, a person familiar with the agreement told The Associated Press.

The person requested anonymity because the person was not authorized to discuss the matter ahead of an announcement.

Under the agreement, the developers, Related Companies and Sterling Equities, would clean up the area and construct a mall on the west side of the ballpark. A 200-room hotel and “two retail strips” are part of the plan for the opposite end of the stadium, the New York Times reported.

Then, no later than 2025, they would start construction on a mixed-use component that would include housing and measure anywhere from 1.3 million square feet up to 4.5 million square feet. The founders of Sterling Equities are Fred Wilpon and Saul Katz, the owners of the Mets.

The redevelopment of the area, currently populated by auto-repair shops and junkyards and lacking infrastructure as basic as sewers, has long been a goal of Mayor Michael Bloomberg’s. In 2007, he announced a 10-year initiative that would bring homes and commercial space to the area.

The new agreement extends past that period, but the person speaking to the AP said that by the original end point of 2017, much would have been done including the vital first step of cleaning the area up and construction of some of the retail spaces.
Sterling Equities is run by Mets owners Fred Wilpon and Saul Katz, both of whom are embroiled in the ongoing fallout of the Bernie Madoff Ponzi scheme that defrauded investors. The Wilpons have been claiming that they were as much victims of the scam as everyone else, but the trustee has targeted funds owned by the Wilpons for reimbursing other victims.

The Mets have had a serious cash crunch for the better part of the past couple of years, and it's limited their ability to field competitive teams. They've also sold off minority ownership shares to investors to help raise funds for operations on and off the field.

So, how is it that the City thinks that Sterling Equities is in a financial position to make any of this happen?

One has to wonder whether they're actually going to be putting up any money of their own and are instead hoping for others to pay the way for them to move ahead on a deal that would benefit them financially in the long run.

Related Companies has deep pockets, and their real estate ventures includes getting another one of Bloomberg's pet redevelopment projects underway - the Hudson Yards. They've got the ability to get this done and they have the experience to build out combined retail and commercial space.

It would be really interesting and insightful to figure out the real working relationship here - and how it is structured.

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