On Jan. 17, the Westchester County Business Journal featured an article titled “Astorino announces $1.2 billion biotech center for North 60.” This article spoke about the proposal by developer Fareri Associates L.P. to create a biotech research facility, children”™s science center, medical offices, a 100-room hotel and retail stores and restaurants on the 60 acres of county-owned land adjoining the Westchester Medical Center.
Following are a few observations from someone who has been involved in the Westchester County commercial real estate market for almost 30 years.
THIS IS THE RIGHT PRODUCT IN THE RIGHT PLACE. With neighboring Regeneron (the fastest-growing company in Westchester) occupying substantially all of the 1.1 million-square-foot Landmark at Eastview, and Acorda Therapeutics occupying substantially all of the former Ciba site in Ardsley, there is virtually no laboratory space available in Westchester to attract new biotech and life sciences tenants to the county.
New York Medical College has recently opened a small biotech incubator on its campus. As new companies outgrow these startup facilities, they do not have anywhere to go to establish their own laboratories. Biotech and life sciences are great industries for our county, as they employ highly educated, highly compensated people, who can afford to live, work and play in Westchester.
Westchester needs more laboratory space and we need it quickly, but this product is very, very expensive to develop and very high risk. It is unique to the life sciences industry and quickly becomes obsolete as technology changes. To date, no developer has been willing to take the risk to create it on a speculative basis until Mr. Fareri stepped forward.
THIS IS NOT HAPPENING TODAY (OR TOMORROW, OR IN THE NEXT FIVE OR MORE YEARS). Westchester is a very difficult county in which to develop. Especially on a combination of county and privately owned land. There will be literally years of paperwork and public hearings. The land lease with Fareri and the county still requires approval by the county Board of Legislators. Construction on the infrastructure (roads, sanitary systems and water supply) will not even commence until all required approvals are in place. Construction of the buildings can only take place after the infrastructure is in place.
The Route 9A corridor has seen some significant private developments lately, including the new Federal Express facility currently under construction in Elmsford, and the proposed redevelopment of the former movie theater in Hawthorne into an Audi automobile dealership in Hawthorne.
Medical uses are growing by leaps and bounds in the county. Recently, the Westchester Medical Center, which adjoins the North 60 site, announced the development of a 230,000-square-foot ambulatory care facility. So a lot is happening on the Route 9A corridor and I am sure it will take a very significant amount of time for a development of this magnitude to be approved.
THE DEVELOPER IS SEEKING TAX INCENTIVES (WELCOME TO REALITY). In part because Westchester is such a high-cost county in which to develop, virtually all developers seek real estate tax incentives and/or IDA (industrial development agency) incentives. It is a part of the normal process of doing business. Not only developers, but companies seeking to move into a new area also seek such incentives as part of leveraging the competitive landscape. Right now the county-owned land is not generating any taxes and the 20 undeveloped acres owned by the developer is generating extremely little. If developed, this project will generate many, many millions of dollars in real estate taxes to the county and the town of Mount Pleasant, not to mention the taxes that will be generated by the many jobs, medical practices and biotech companies that will be housed there. Any businessman would ask for such incentives, which are really minor in the whole scheme of things. The approval process will take years and millions of dollars, but the project will live (and generate taxes and jobs) for far longer than that.
The good news is that this proposal is one that will benefit the county in general and the west side in particular. It will help to raise the primarily industrial and big-box retail profile of the 9A corridor with higher and better uses, and thousands of construction and permanent jobs. It will just take time (a lot of it) until we see shovels in the ground and tenants filling the buildings. Let”™s hope our legislators and the public recognize the value of the project and provide as few roadblocks as possible during the long and arduous approval process.
Howard E. Greenberg is president of Howard Properties Ltd. in White Plains. He can be reached at howard@howprop.com or 914-997-0300.
