Orangetown has selected a potential developer for the shuttered HNA Conference Center on Route 9W: A California-centric company whose two-phase plan represents an eclectic mix of hotel/luxury spa, entrepreneurial work/space, and long-term stay townhomes.
Whether the plan wins approval from the airline that owns the property remains up in the air.
Nestled on 106 acres of pastoral land off Route 9W in the upscale hamlet of Palisades, the IBM Conference Center was sold to China”™s Hainan Airlines in 2015 for $59.6 million. Renamed the HNA Palisades, the upscale hotel/conference center struggled to market itself and then went on the market, losing a potential buyer who bid too little. By January 2021, China”™s fourth-largest airline was in bankruptcy court and the property shuttered.
Since the hotel had been contributing $1.2 million to the Orangetown school district and over $600,000 to the host community, the town passed a resolution to ensure the property would remain on the tax rolls, issuing a Request for Expressions of Interest for development ideas. Failing that, it would commence condemnation proceedings to absorb the property back into the town.
Three separate teams vied for the project:
- Procida Funding, which proposed to partner with two hotel groups, Wyndham and Dolce, and to bring in Toll Brothers and Woodmont Properties to add a mix of market-rate housing.
- Cook Fox Architects/Atlas Capital Group, which proposed to upgrade the hotel and to add a 500,000-square-foot movie studio to the property.
- Kitching/Pelayo, which proposed to upgrade the hotel and to eventually bring long-term townhome rentals in a second phase of development.
All three proposals were shared on the town”™s website and principals were invited to speak in public to allow residents to weigh in. Orangetown”™s Board voted 4-0 (with one abstention) to select the plan offered by California-based real estate broker Mark Kitching of Douglas Elliman Real Estate and Sunia Homes design/builder Jerome Pelayo.
Kitching/Pelayo”™s winning proposal includes plans to upgrade and beautify the existing hotel, its spa and luxe amenities and the installation of a rooftop garden to the 450,000-square-foot structure. The Cali team envisions the Palisades property as a “haven for the next generation of great thinkers, creators, engineers and artists, giving them the space and tools to perform their best work.”
To aid in the endeavor, it would welcome corporate sponsors and clients and establish a creative and educational gathering space to rival what New York City”™s five boroughs offer without the congestion and traffic that comes with it.
The second phase of development calls for construction of 20 or more townhomes for long-term stays.
Orangetown”™s Supervisor Teresa Kenny said Kitching/Pelayo”™s plan wasn”™t an “easy decision,” but it made the most sense for the town. It will keep the property on the tax rolls and, according to the developers, will require no modification to its current zoning in the first phase of development. The second phase would require a zoning change.
It remains to be seen if Orangetown”™s finalist will be acceptable to Hainan Airlines, which Kenny said has been working cooperatively to sell the property. If the sale cannot be finalized, the town may exercise its option to go forward with a condemnation proceeding, something it is loath to do. Kenny has repeatedly said that keeping the property on the tax rolls is imperative for the town”™s future.
