Tishman-Speyer Downtown Proposal Appears To Be A Go

by James C. Benerofe

On Monday night, January 10th a special meeting of the White Plains Common Council saw the first serious update in about a year of the Tishman-Speyer development proposal for the old Macy's site at the corner of Mamaroneck Avenue and Main Street. Steven Wise, senior director at Tishman-Speyer and the project leader made the presentation. After the presentation the council met in a four hour executive session from which they emerged stating that the session had been productive and they would be meeting on Friday January 14th at which time they would decide if they were going to move ahead.

In his Monday night presentation, Steven Wise said that the project was substantially the same as the original proposal. The total cost of the project would be $125,000,000 and would include 125,000 square feet of movie theatres with 21 screens and 5100 seats, 230,000 square feet of retail space, and 45,000 square feet of restaurants, along with a new municipal parking garage with 1850-2100 spaces. The City would fund the garage which it is estimated would cost $32,000,000.

Wise expects the new development to attract 2,000,000 visitors annually. Approximately, an average of 100,000 visitors per week to the White Plains Town Center. He emphasized that it will be a pedestrian related retail and entertainment center and not another mall. He projected that the new development would produce about $7,000,000 in sales tax, $1,100,000 in real estate taxes, and about 1,400 new permanent jobs. He also indicated that it would encourage other development and increased economic activity for Mamaroneck Avenue and Main Street.

At the council meeting on Friday, five of the six council members gave their support to the project although there was not a formal vote taken. The consensus was to move ahead. They expressed some reservations about taxes and traffic but felt that not moving forward would result in far worse consequences. Only freshman council member Bill King said that he was not presently prepared to give the project his support. He made it clear that he was not against the project but wanted to see ten conditions or questions met and answered before giving his support. The text of Bill King's conditions follows. After King's remarks Mayor Joseph Delfino made a personal statement and also issued an outline of the agreement in principle between the City and Tishman Speyer. (The text of both follows.)

Bill King's Conditions of Approval of the Tishman Project

1. Theater seats guaranteed for the life of the agreement (PILOT period plus 10 years) - minimum number of seats = 50% of 5,100 proposed

- minimum not met = PILOT cancelled

2. Site can't sit there, with old Macy's building or as bare site, after approval, for a prescribed maximum amount of time (say 3 months pre- or post-demolition) or else site is assessed and taxed at its forecast assessed value (i.e. $4.2m)

3. Final design must be acceptable - up to same level as early design renderings

- must have entrance and marquee on Mamaroneck Ave.

- must have entrance on Main Street - can't just be blank wall

4. City finances must be ok -

• can't have potential for a double digit tax increase or even a high single digit property tax increase

5. Traffic study must show streets can handle project without gridlock & impacts on surrounding neighborhoods

• want to also see whether streets can handle any significant office or other projects after this (if can't, then spin-off benefit of this project is limited)

6. What is the City's plan for the rest of the Downtown?

- Will we be able to afford anything?

7. Must have acceptable sales price for the Hole in the Ground

• to generate funds that we can use either for other projects in the Urban Renewal area or for one-time projects in the City at large

8. Public Comment

- What does the public have to say about this?

9. Agreement's Confidentiality lifted

- Public must be informed.

- Council should be able to talk about the terms of the deal.

10. Minimum Sales Tax Guarantee

- or else PILOT increased to make up the difference

 

Mayor Joseph Delfino’s Statement:

I am very pleased to announce that the Mayor and Common Council have agreed in principle to a public/private partnership with Tishman-Speyer/Travelers to develop the White Plains Town Center which will, at long last, bring the movies to White Plains as part of an exciting, new entertainment and retail complex to be constructed in the heart of downtown. Plans for the site include a 21-screen, 5,100 seat Sony megaplex, retail stops and restaurants, and a major anchor store.

Before I outline the details of the agreement, I would like to personally thank the Common Council for supporting this project. Over the past decade, all of us have watched with frustration as downtowns in cities throughout the nation began to lose their luster as a consequence of changing consumer dynamics.

Many have often questioned whether there was any hope of a comeback for downtowns. Struggling downtowns have long searched for answers, and while there have been some success stories, many downtowns have been unable to attract investors willing to risk the necessary capital.

My philosophy during the past two years in trying to reach an agreement with Tishman Speyer has been that we need to convey a sense of confidence in our downtown but not desperation. Investing in a city's future should not mean mortgaging the future. However, if we expect outside developers to believe in our downtown, we as a city have to believe in our downtown first. And I am very proud that we were able to reach an agreement with Tishman that creates a win-win scenario for everyone.

The deal that we have struck meets our objectives of creating new life in the downtown and bringing the movies back to White Plains, and will hopefully act as a catalyst in attracting other developers to Mamaroneck Avenue. The investment that the City is prepared to make not only pays for itself over time, but will actually generate over $34 million in revenue for the City over a 25 year period. It will also produce new revenue for our school district and create over a thousand permanent new jobs.

I would also like to point out the significance in Tishman/Speyer's commitment to undertake this new project. Tishman/Speyer has agreed to make the bold move that no one else thus far has been willing to make. Tishman's $150 million investment into our downtown signifies a strong belief in the future of Mamaroneck Avenue and signifies a great hope for a new renaissance. In the upcoming months, my administration will be working to move this process forward and I am hoping that we can get the shovel in the ground as soon as possible. And very shortly, I will be announcing my plan for the second phase of the revitalization effort, which will further outline my vision for the downtown.

At this time, I would like to disclose the main elements of our agreement with Tishman/Speyer.

PUBLIC/PRIVATE PARTNERSHIP

City of White Plains and Tishman-SpeyerlTravelers

WHITE PLAINS TOWN CENTER

The Mayor and Common Council have agreed in principle to a public/private partnership with TishmanSpeyer/Travelers (T-S/T) to develop the White Plains Town Center which will, at long last, bring movies back to downtown as part of an exciting, new pedestrian-related entertainment and retail complex to be constructed in the heart of downtown.

In addition to the construction of the new Town Center, by T-S/T, anew and larger multilevel public garage will be built by the City and T-S/T at the site of the present Main-Martine Garage to serve the Town Center and Mamaroneck Avenue, as well as all downtown.

The main elements of the public-private partnership that were disclosed at the Common Council work session this morning include:

- The conveyance of parcel number 50 off of Conway Drive by the City to T-S/T

- The conveyance of other required parcels for the project to be acquired by the City through its powers of eminent domain to T-S/T for their appraised value if those parcels cannot be acquired through an arms length transaction

- The construction by T-S/T of a $125 million entertainment and retail center on three levels totaling approximately 440,000 square feet. The construction will be financed through the sale of Industrial Development Agency (IDA) bonds.

- The sale of air rights over the existing garage by the City to T-S/T only to the extent needed to construct an 1850 to 2100 space garage

- The creation of a Local Development Corporation to construct and own (over the life of the IDA bonds) the 1850 to 2100 space garage and various peripheral street and sidewalk improvements at an estimated cost of $35 million; the garage will consist of two condominium units. Once the bonds have been retired, the garage will revert to the sole ownership of the City.

- The contribution of $13 million by the City to construct a multi-level garage and various peripheral street and sidewalk improvements

- The issuance of a contract to the White Plains Parking Authority by the Local Development Corporation to operate the new public parking facility.

The City anticipates receiving new property tax revenue ranging from approximately $50,000 to $400,000 per year during the term of the PILOT. Sales tax revenues from the White Plains Town Center to the City have been estimated by an independent expert hired by the City to exceed $1.9 million a year. The net gain to the City over the next fifteen (15) years (the estimated life of the City's serial bond issue to finance its contribution to the garage) is estimated to be at least $5.5 million; that gain over twenty-five (25) years is anticipated to exceed $35 million in total.

In addition to providing increased real estate and sales tax revenues, the construction of the White Plains Town Center will result in the following economic benefits to the community:

Construction is planned to start during the summer of 2000 with an estimated completion date for the winter of 2001/02. When completed, the project is expected to draw an average of an additional 100,000 visitors per week to the downtown.