“In reality this has been a campaign,” Connecticut developer Felix T. Charney told an audience at a groundbreaking ceremony on his company”™s Chappaqua Crossing property on Super Tuesday. He was comparing his effort to redevelop the former Reader”™s Digest campus, an iconic landmark in the town of New Castle vacated six years ago by its bankrupt former owner and primary tenant, to the presidential primary races that dominated the news.
“It”™s been long. It”™s been expensive. It”™s been frustrating,” said Charney, president of Summit Development LLC in Southport and principal of Summit/Greenfield Partners. That joint-venture partnership in 2004 paid $59 million for the 114-acre campus and 662,000-square-foot complex of buildings distinguished by the Georgian-style Reader”™s Digest headquarters, crowned by a cupola and winged-horse statuary, which opened in 1939.
In the 11 years since their purchase, the developers faced strong community opposition to their plans to build multifamily housing and redevelop office space for multiple tenants. The project”™s oft-extended review by town officials at numerous board meetings and public hearings led Charney and co-owners at Greenfield Partners LLC in Westport to file state and federal lawsuits claiming they were deprived of economic use of their property by the town”™s stalling tactics and alleged effort to maintain the commercial campus as a parkland buffer for surrounding residential neighborhoods. Chappaqua Crossing”™s owners also have filed several tax certioraris in state Supreme Court through the years as project delays continued, seeking reductions in the assessed value and tax refunds for their underutilized property.
Five years after their purchase, Summit/Greenfield partners sustained another financial blow and New Castle lost a large piece of its thin commercial tax base when a U.S. Bankruptcy Court judge allowed The Reader”™s Digest Association Inc. to break its leases with the landlord for about 287,000 square feet of space. The publishing company relocated more than 500 employees and contractors to offices in Manhattan and White Plains.
It was a “long and painful” process of compromise, said Charney, which led to the ceremonial groundbreaking on Super Tuesday for the 120,000-square-foot, $50-million retail portion of the development approved by town officials about one year ago. Town officials also have approved construction of 91 townhouses in a hilltop campus development called North Village and 28 affordable apartments in the former Readers Digest headquarters building.
Charney said Greenfield, his development partner in Connecticut projects since 1992, has sold its retail portion of the project. Charney”™s new retail development partner there is The Grossman Cos. Inc. of Massachusetts.
Charney told the Business Journal that Summit/Greenfield spent “in excess of $7 million” in the 11-year municipal review and approval process. Total acquisition and development costs will amount to about $175 million, he said.
Chappaqua Crossing”™s first tenant will be Whole Foods Market Inc., which will begin construction this year on a 40,000-square-foot grocery store expected to open in 2017.
The supermarket retailer will be soon followed by Life Time Fitness Inc., which expects to start construction this summer on a 40,000-square-foot fitness center at Chappaqua Crossing. That facility also is expected to open in spring 2017.
The Minnesota-based company two years ago opened its first Westchester County location, a 209,000-square-foot fitness center on the razed site of the former Gannett Co. newspaper plant in Harrison. Jeff Melby, senior vice president for real estate and development at Life Time, said at the groundbreaking that the company was aware of the potential of the Chappaqua Crossing development even before Life Time started work on its Harrison location.
Charney, displaying a barbed wit before showing his mettle with a gold-plated shovel over a ceremonial dirt pile, singled out in the audience the four New Castle town supervisors with whom he worked and battled over 11 years. He credited the third supervisor to serve during that span, Susan Carpenter, for being “able to think outside of the box” and approaching the frustrated developer about adding retail space to the office and residential project.
“In my 35 years of developing, that”™s a first,” said Charney, who ventured into New York and Westchester ”” and the state”™s oft-criticized environmental quality review process for proposed developments ”” with a lengthy record of successfully completed projects in Connecticut and Florida.
The interest by Whole Foods in opening a store at Chappaqua Crossing “began to turn this from questionable to palatable,” he said.
Charney said about 40 percent of office space on the property is occupied, though inquiries from prospective tenants and leasing activity have picked up significantly since the retail development was approved. The redeveloped campus will include about 500,000 square feet of office space.
The developer said the 2013 election that brought attorney Robert Greenstein, a neighbor and vocal opponent of the Chappaqua Crossing project, to the town supervisor”™s office was “a pretty dark day.” But his “nemesis” surprised him.
“He didn”™t gloat; he extended an olive branch,” said Charney. Led by Greenstein, the town board one year later changed zoning at the site to allow retail development and the entrance of Whole Foods.
“What started out as the longest and most controversial application in our town”™s history,” Greenstein said in remarks at the ceremony, “ended up as an example of the benefits of working together. Chappaqua Crossing will once again provide a strong contribution to our commercial tax base while at the same time creating new amenities for residents and preserving the character of the surrounding neighborhood.”
The developers agreed to keep 50 acres of permanent open space surrounding the developed areas of the site. Summit/Greenfield also will lease the Reader”™s Digest Wallace Auditorium as a municipal performing arts center for $1 a year with an option for the town to acquire the facility.
“I have learned a lesson,” Charney said of his 11-year struggle to redevelop his property. “In Westchester, maybe you need to measure things in decades rather than in quarters.”
