It”™s a new economic reality that has New Rochelle Development Commissioner Michael Freimuth dropping in at small businesses near the city”™s downtown train and bus center this spring with a recruiting pitch from a would-be public partner.
With large private projects in the city either dead or stalled and being reexamined, the city administration wants to spur new opportunities for growth and spare investors what Freimuth called the “brain damage” of assembling development sites and negotiating prices with myriad property owners.
In this test model for New Rochelle, the city would lay the groundwork for a packaged land deal that benefits both developers and sellers and market the assemblage for private owners. The city would avoid the costs and risks of public acquisition or property condemnation, Freimuth said of the post-recession strategy.
“It”™s the Three Musketeers: you”™re all for one and one for all,” he said. He has urged business owners to have their properties independently appraised to compare their present values with their potential values in a site assembly.
Around the North Avenue transit center that is the city”™s hub of planned development, “We want to put additional sites in play,” said New Rochelle Mayor Noam Bramson, a goal he also stated in his State of the City address last month. “Enticing private partners among property owners is always a useful strategy.”
Ongoing financial, legal troubles
For New Rochelle”™s most prominent downtown developer, the damage from assembled properties has been financial and legal since the economy tanked in the last three years.
LeCount Square, the ambitious mixed-use redevelopment of approximately 1 million square feet proposed by developer Louis R. Cappelli and Cappelli Enterprises Inc., died quietly at the start of this year, when the City Council failed to grant another extension for the long-stalled project near Cappelli”™s New Roc City and Trump Plaza developments. As of last fall, the Valhalla company had spent $16 million to $17 million on the project, according to Joseph Apicella, project manager and executive vice president at Cappelli Enterprises.
Owners of an apartment and retail building at 5 Anderson St. for which Cappelli signed a purchase option contract are seeking more than $11 million from the developer in a lawsuit pending in state Supreme Court. At Cappelli”™s request, the owners vacated the building”™s 36 apartments and six retail stores to make way for LeCount Square construction.
The building, damaged by its use for fire and police training while vacant, needs $2 million to $3 million in renovations before it can be occupied again, said Joseph Stargiotti, the Pleasantville attorney representing plaintiffs in the lawsuit.
Though his clients have talked to prospective tenants, “They”™re sort of hamstrung,” said Stargiotti. “They can”™t fill it without his (Cappelli”™s) permission. He hasn”™t granted his permission.”
The building owners also were promised 22,000 square feet of future retail space in LeCount Square as part of their deal with the developer.
“He”™s using the court system to delay things and choke my clients financially,” said Stargiotti. For the owners seeking an out-of-court payment from Cappelli for lost profits and the cost of renovations,
“His answer is, ”˜I don”™t have any money,”™” their attorney said.
Apicella said Cappelli Enterprises soon will propose modified plans for the LeCount Square site to city officials.
“In this new economic environment, sometimes you have to hit singles or doubles; you can”™t always hit home runs,” he said.
“We”™re more than willing to hit a single or double that”™s acceptable to the city and conforms with zoning regulations.”
Developers take more cautious approach
On the New Rochelle waterfront, Forest City Residential Group, the Brooklyn-based developer, in February was given a one-year extension by the City Council for its 4-year-old mixed-use project on Echo Bay.
Bramson said the developer will preserve and restore for adaptive reuse the armory building on the site, which was slated for demolition in the initial proposal. And Freimuth said the project”™s approximately 700-unit housing component will be reduced “just because of the marketplace.”
While Forest City explores alternative project designs this year, the city will conduct “its own parallel inventory of its costs and benefits” for the waterfront project, said Bramson. The developer will pay that study”™s estimated $100,000 cost.
That more cautious approach of private developers and public officials in the new economic reality also is being applied to a potential mixed-use development on the city”™s downtown Church-Division and Prospect Street parking lots.
Albanese Organization Inc., a Garden City developer noted for its award-winning sustainable-design projects, soon will report to city officials on the feasibility of building an approximately 500-unit residential and commercial complex there. Simone Development Cos., which recently relocated its headquarters from New Rochelle to the Bronx, dropped its plans for the site in the economic downturn.
“The trick is,” said Bramson, “how do you close the deal and still maintain the 600 parking spaces” that the project would replace.
Economic impact on the downtown
At Talner Fine Jewelry and Giftware on downtown Main Street, co-owner Albert Tarantino has been in business for more than 40 years. He brings his business perspective to the City Council, where he has served three years.
While ethnic restaurants have opened to serve residents of the city”™s high-rise downtown developments, Avalon Bay and Trump Plaza, more retail and office space are needed, said Tarantino.
Bramson said the same in his recent State of the City speech.
“Both bring traffic” to downtown businesses, Tarantino said at his jewelry store at 565 Main St. “We need both of them desperately.”
Tarantino said the city needs to “slow down” on residential development or risk pushing its infrastructure services “to the tipping point.” He noted the city added about 5,000 residents in the recently released U.S. Census, a 7 percent increase to its population that will further tax its ability to deliver basic services such as garbage removal, street cleaning and police and fire protection. “All of these things need to be looked at before you can really go forward with residential housing down here,” he said.
“Every project that seems to stall builds a negative momentum for it,” Tarantino said of the LeCount Square and Echo Bay projects.
“As time goes on, the public starts to lose its appetite for the project.”
As a downtown economic stimulus, “People can very easily look at Trump Plaza and say it”™s a failure,” he said. “But is it a failure because of the project or because of the economy? The economy has had more of an impact negatively on downtown than any development could have a positive impact.
“Until this economy starts to turn around and improve, a lot of the development is discussion right now rather than development.”
It is not ONLY the past Recession which has ‘ stiffled” development and progress in downtown New Rochelle, it is the fault of a very inefficient, corrupt, and dysfunctional city government which has made it close to impossible to get anything built there. Add to it all the social,criminal, and political problems New Rochelle faces and again, one comes up with a formula for disaster. Is it any wonder why it takes 15 years just to build one silly tower? In Manhattan,a tower is built in less than 6 months. New Rochelle is not Manhattan and never will be. It is a very, expensive, chaotic ghetto lead by a delusional, egotistical Mayor.
Cappelli fails to ever deliver on anything but smoke!!!
Bramsons Political Career tanked due to his inability to find another developer and move on. New Rochelle has too much Section 8 housing within blocks of the site. People are being killed in low level street crime for larceny and drugs only yards away. Taxes in New Rochelle continue to blaze higher and higher as they are servicing Police and Fire Pensions like mad. Trump Cappelli stands mostly empty due to this fact. Stick a fork in New Rochelle the Democrats have run it into the ground with their only way out is to over tax the homeowner.
Bramson’s results lay at his own feet due to a very understandable set of personal flaws.
He suffers from Harvard syndrome in his belief he is smarter than all around him.
In doing so he outsmarted himself.
He squandered it all on his own inability to adapt away from his Mantra as it simply did not work. Imagine hacking away and hacking away no matter how unsuccessful just because you want to prove to everyone you are indeed right. Laying down with Dogs he now owns the fleas.
He has placed New Rochelle into a state that it will take 20 years to recover from. Sure he can blame it on the recession but the truth be told he only has himself to blame.
Anonymous attacks on Mayor Bramson and other city government officials should be taken with a grain of salt, for openers. I attended the Mayor’s State of the City address and in addition to his usual eloquent delivery, I thought it was quite humble and matter of fact. These are tough times for both government and small business owners. And as more and more property owners seek tax relief, there is less and less revenue for the city to work with in terms of delivering services and promoting development. As a commercial real estate agent, I understand the challenges that communities such as New Rochelle face. In many ways, New Rochelle is more a reflection of America in 2011 than it is typical of Westchester County. Developers, national retailers, restaurateurs and service providers catering to the needs of a multi-cultural community would be wise to put New Rochelle on their radar screen and jump on the many, “bargain” development opportunities that this prime location community has to offer. I was also glad to see the Mayor address the fact that new development can’t come without first addressing current and future needs for adequate parking. Americans won’t give up their cars and marketing existing buildings with inadequate parking is very difficult.