Two developers are charting different courses towards the same suburban warehouse nirvana.

In Elmwood Park, New Jersey, Crow Holdings has acquired 12 acres at the site of the Marcal Paper factory, NorthJersey.com reported. A fire in 2019 devastated the site, and although no one was injured, 500 people lost their jobs, NBC New York reported.

The paper company was able to resume manufacturing on part of the 1 Market Street site in 2020, but the rest has stood vacant. Crow Holdings plans a 206,000-square-foot warehouse there.

The developer expects to break ground this summer. Crow has received site plan approval and is projected to spend between $90 million and $100 million on the industrial development, which will take 12 to 18 months.

On Long Island, Prologis has its own industrial plans, according to Newsday. The San Francisco-based company wants to demolish a former Grumman office building in Bethpage to put up a 239,000-square-foot warehouse at 600 Grumman Road West.

Prologis purchased the site recently for $51.2 million, or about $3 million per acre. The 17-acre site has a pair of office buildings totaling 218,000 square feet and a 10,000-square-foot former steam plant that would need to be vaporized.

According to Prologis, the warehouse would be able to support multiple tenants and dozens of jobs. The project is estimated to cost $100 million.

Prologis’ plans for the site were reported when it purchased the property, but the REIT is now seeking 20 years of tax breaks for the development. Prologis says if the Nassau County Industrial Development Agency balks, the project will not go forward.

“It’s not happening without the IDA’s assistance,” Prologis real estate attorney Daniel Dornfeld told Newsday.

A year ago, building warehouses was like printing money; many were leased well before they were completed. But negative news has hit the industrial sector in recent weeks, which could explain Prologis’ insistence on subsidies.

The industrial giant works closely with Amazon, one of the largest industrial tenants in the country. But the e-commerce giant has done an about face on warehouse holdings after overcommitting itself during the pandemic boom. Bloomberg reported that Amazon is looking to sublet 10 million to 30 million square feet of industrial space. The company could also end some of its leases with landlords.

Article: https://therealdeal.com/2022/06/06/100m-warehouses-planned-in-new-jersey-long-island/

A new $18 million apartment development in Westbury will get economic incentives from the Nassau County Industrial Development Agency. 

The project from Terwilliger & Bartone Properties will bring 59 rental residences to .61 acres at 425 Railroad Ave. 

The 46,334-square-foot apartment building, which replaces a blighted warehouse, consists of 20 studio apartments, 26 one-bedroom units and five two-bedroom units. Eight of the apartments are dedicated as affordable workforce housing units for those making less than 80 percent of the area median income.  

Without the new development, the existing property would generate $2 million in tax revenue over the next 22 years, according to an IDA statement. But the rental project is set to bring in about $8.2 million in tax revenue over the course of its 22-year payment-in-lieu-of-taxes agreement. 

“As a Long Island-based company, we are passionate about helping our community thrive through housing,” J. Ronald Terwilliger, a principal owner of Terwilliger & Bartone Properties LLC, said in the statement. “This project would not have been possible without the help of the IDA. Thanks to their assistance, dozens of current and incoming Nassau County residents will be able to call our community home.” 

This is the second phase of a pair of Westbury rental developments being built by Terwilliger & Bartone and dubbed Cornerstone at Westbury. The first, which also received economic incentives from the Nassau IDA, will bring 72 apartments to a property formerly used as a food handling warehouse at 471 Railroad Ave.  

The two Westbury projects, located a stone’s throw from the Westbury Long Island Rail Road station, are receiving a Smart Growth Award from Vision Long Island next week. 

“Housing is one of the most crucial aspects of keeping Nassau County’s economy alive,” Nassau IDA Chairman Richard Kessel said in the statement. “This is especially the case with affordable housing, which helps Long Islanders of various economic backgrounds live and work in our community. We at the NCIDA are excited to work with Terwilliger & Bartone Properties LLC in getting this project off the ground so we can continue to help our residents and economy thrive.” 

Article: https://libn.com/2022/06/02/18m-westbury-rental-project-gets-ida-assist/

The developer of a $55 million warehouse proposed for the current site of News 12 studios in Woodbury has requested 20 years of property-tax breaks from Nassau County, executives said.

Rockefeller Group International Inc. purchased the broadcasting center, along with an adjacent parcel, last year. It plans to construct a 150,000-square-foot warehouse, but demolition won’t start until the cable television station moves to new studios in Bethpage, the executives said.

Besides the property-tax savings, Rockefeller Group has requested that the county’s Industrial Development Agency grant a sales-tax exemption of up to $1.2 million on the purchase of construction materials and equipment.

The IDA board voted unanimously last week to negotiate an incentive package with the developer.

Phillip Golub, a project manager at Manhattan-based Rockefeller Group, said the warehouse would be “modern, state-of-the-art. … We believe this will add something new to the Island.”

No tenants have yet committed to using the building. He estimated that 68 people would work there initially, earning an average of $45,400 per year.

Peter L. Curry, the developer’s real estate attorney, said it is requesting that the IDA tax-savings deal be written as if the News 12 building has already been torn down. By doing so, the current property-tax bill goes from $601,800 per year to $376,630.

The Nassau IDA, unlike some in Suffolk County, doesn’t reduce current property taxes; the future savings is on higher taxes because the property’s value increases with new development.

IDA board member Reginald A. Spinello said last week that he found Rockefeller Group’s proposal “a little bit troubling [because] now we have a project that can start below existing taxes” under a potential incentive package.

Curry responded that, if News 12 were not operating from the building, it  would have been demolished by now, and vacant land carries lower property taxes. But Rockefeller Group is “letting [News 12] stay as long as they need to stay,” he said.

By the time construction starts in January, the land will be vacant. “We are asking for something that we don’t normally ask for because you couldn’t kick News 12 out of its building,” Curry said.

IDA chairman Richard Kessel concurred but said “it has been the practice of this IDA not to lower taxes. … We will have to work our way through this issue.”

A spokeswoman for News 12’s parent, Altice USA in Long Island City, Queens, didn’t respond to a request for comment on Wednesday.

Separately, Rockefeller Group has told Oyster Bay Town that the warehouse’s size would be reduced by 25% if a zoning code change is adopted by the town board. The change requires additional parking at warehouses within the town.

The Woodbury project is the developer’s second on Long Island. It plans to construct a 172,000-square-foot warehouse in Bay Shore, according to executives.

Rockefeller Group was founded in 1928 by John D. Rockefeller Jr., the only son of oil magnate John D. Rockefeller. The company is best known for developing Manhattan’s Rockefeller Center.

Article: https://www.newsday.com/business/rockefeller-group-warehouse-news-12-ida-tax-breaks-l4p71oud

An auto body business will get economic incentives from the Town of Hempstead Industrial Development Agency to assist with a $7 million project in Garden City. 

Prosperity Avenue Holdings LLC, an affiliate of Great Neck-based Paul’s Auto Repair and Collision, plans to renovate and equip the 11,900-square-foot industrial building on .36 acres at 585 Commercial Ave. 

Owner Paul Wilson plans to have 30 employees with an average salary of $60,000 within three years at the new facility, according to an IDA statement. The repair center, which will also serve as a training facility, will offer its services to other collision repair firms, auto dealers, car rental businesses and insurance companies. 

Current annual property taxes on the 66-year-old building are $44,808 and the taxes are estimated to rise to $76,000 by the end of a 15-year payment-in-lieu-of-taxes agreement. 

“This project not only will generate economic growth, new jobs for the residents of the Town of Hempstead, but also will provide vocation training,” Fred Parola, Hempstead IDA CEO, said in the statement.

Article: https://libn.com/2022/05/27/auto-body-shop-gets-ida-help-with-7m-garden-city-project/

A California development company wants to demolish a former Grumman office building in Bethpage to make way for a 239,000-square-foot warehouse, executives said.

Prologis Inc., a public company based in San Francisco, has signed an agreement to purchase 600 Grumman Rd. West. On the property, near the vacant 218,150-square-foot office building, is a historic Navy F-14 Tomcat fighter jet that was built by aerospace giant Grumman Corp. in Bethpage in 1992.

An attorney for Prologis said the company hasn’t yet decided how, or if, the F-14 will be included in the redevelopment project. In 2008, the jet was lent to the Grumman Retiree Club, a former employees’ group, by the National Museum of Naval Aviation in Pensacola, Florida.

As for the proposed building, Prologis development director Jonathan Payne said it could house one or more tenants and create a minimum of 10 to 50 jobs.

“We would look to have a multi-tenant scenario or a single tenant scenario, depending on user interest,” he told a meeting of the Nassau County Industrial Development Agency.

Prologis is seeking 20 years of IDA tax breaks for the project, including a sales-tax exemption of up to $2.7 million on the purchase of construction materials and equipment. In April, the agency’s board voted unanimously to negotiate an incentive package with the developer.

The project, estimated to cost about $100 million, would be Prologis’ first on Long Island, though others could be in the offing, said Chi Osu, a company vice president.

“We think the market here is underserved and we are interested in expanding further into Long Island, depending on how this project goes,” Osu said, responding to a question from IDA chairman Richard Kessel.

Prologis owns 1 billion square feet of warehouse and industrial space in 19 countries. Its buildings are rented by about 5,800 companies, including Amazon, FedEx, Target and United Parcel Service.

Prologis operates as a real estate investment trust, or REIT, with shares traded on the New York Stock Exchange. It reported a profit of $3 billion last year on revenue of $4.8 billion. The company’s workforce totals about 2,000 people around the world, according to securities filings.

Daniel S. Dornfeld, Prologis’ real estate attorney, said it would not pursue the Bethpage project without tax breaks. “It’s not happening without the IDA’s assistance,” he said.

A representative of the Grumman retirees’ group didn’t respond to a request for comment about the fate of the F-14. It is the 711th of the 712 F-14s built on Long Island in the 1980s and 1990s.

The jet fighter received time on the big screen in the 1986 movie “Top Gun”, starring Tom Cruise. A sequel, “Top Gun: Maverick”, opened in theaters on Friday.

Article: https://www.newsday.com/business/prologis-warehouse-grumman-bethpage-ida-tax-breaks-ttb53zl8

In 30 minutes, the Suffolk County Industrial Development Agency approved millions of dollars in tax breaks for one warehouse project but couldn’t muster the votes to decide the fate of another.

The warehouses differ in size and the number of employees that would work in them.

But the projects are similar in many ways: Both are from large development companies that are relatively new to Long Island. They would be located in the county’s western half. Neither yet has tenants. The warehouse workers would earn about $40,000 per year.

The IDA board voted unanimously last week to give final approval for $2.4 million in tax breaks to the Venture One Real Estate LLC warehouse in Hauppauge. However, there weren’t the necessary four votes to grant or deny final approval for $8.7 million in tax breaks to the Hartz Mountain Industries Inc. warehouse on Spagnoli Road in Melville.

The Hartz project was supported by three board members and opposed by two. So, the resolution neither passed nor failed, said IDA executive director Anthony J. Catapano.

The seven-member board has one vacancy and one member did not attend Thursday’s meeting.

In voting against Hartz, IDA board member Joshua Slaughter said he needed more financial information from the New Jersey-based developer to determine whether tax breaks are required to build the 411,000-square-foot warehouse.

Board member Brian Beedenbender agreed, saying he wasn’t certain the $106 million project depended on IDA assistance. He said Hartz purchased the former National Grid training site for $37 million in 2019, before the pandemic and rising inflation.

“I still think [the warehouse] gets built anyway,” Beedenbender said.

Hartz executive James Rhatican responded, “I can’t say that it would or would not get built but for this [tax-aid package]. But I can tell you that these incentives … [will] bring tenants to the area” because the $5.2 million in property-tax savings over 15 years would lead to lower rents, he said.

On Friday, Rhatican told Newsday that Hartz is “disappointed that the motion to approve the incentives for this project didn’t carry.” But he said the company would hold talks with the IDA staff “to see if there is a path forward on the application.”

Between 200 and 300 people would eventually work at the proposed warehouse, according to Rhatican.

Hartz first sought the IDA’s help for the Spagnoli Road project a year ago, as the developer was embroiled in controversy with local unions over the use of out-of-state contractors and construction workers to build two warehouses at 235 Pinelawn Rd.

That project, on the site of the former Newsday headquarters, won nearly $17 million in tax breaks over 20 years in a 4-2 vote by the IDA board in November 2020.

More recently, Hartz appeared to have made peace with the unions and the IDA voted unanimously in April to grant preliminary approval for a tax-aid package for the Spagnoli Road warehouse.

Separately, the tax savings approved for the Venture One warehouse will last for 10 years.

The 90,700-square-foot facility, costing $44 million, would replace a vacant office building at 49 Wireless Blvd. Between 30 and 100 people would eventually work there, said Brian McDonagh, Northeast regional vice president at Venture One, which is based in a Chicago suburb.

Article: https://www.newsday.com/business/ida-tax-breaks-warehouse-hartz-mountain-venture-one-udte9bva

A former farming community, Melville is a thriving commercial and residential hamlet whose farming roots are still evident in the horse farms in the West Hills area and at the perennially popular White Post Farms.

From 1909 to 1919, a trolley traversed Route 110, and was shuttered only after farmers complained that the noise disturbed their livestock.

Today, the area is known for the 110 corridor, a 16-mile stretch with a section in Melville that includes office parks, the headquarters for Canon, Henry Schein and other major corporations, and an Amazon facility under construction.

The corridor is ever expanding, with a range that include many stores in a swath known as Furniture Alley, and a fair number of restaurants, all of which contribute significantly to the area’s tax base, says David Gustin, president of the Melville Chamber of Commerce.

“The 110/Broadhollow Road corridor connects Amityville to Melville to Huntington, as one of the most populated areas of the Suffolk community,” says Gustin.

Calling Melville “a beautiful and peaceful neighborhood,” Nikki Perri, an agent with Signature Premier Properties, says, “You will immediately notice the wide, tree-lined streets. This neighborhood is perfectly located near restaurants, shopping, parks, and is only a short drive to some of Long Island’s most beautiful beaches.”

In addition to several gated communities, there are many Colonials and ranches and a few contemporary homes in the area, with prices starting in the mid $500,000s and going up to about $5 million.

The hamlet is also home to BAPS Shri Swaminarayan Mandir, a sprawling, ornate Hindu temple, that opened in 2016.

Melville’s central location and proximity to the Long Island Expressway and the Northern State, Sagtikos and Southern State parkways is a big plus, notes Town of Huntington Supervisor Ed Smyth.

“If you’re a commuter, it’s a great place because you have very easy access to the major east-west and north-south arteries on Long Island,” he says.

Article: https://www.newsday.com/classifieds/real-estate/buying-in-melviille-rn9o3asx

Activity in New York City’s investment sales market continued to rebound in the first quarter of 2022, but a slowdown could be on the horizon as rising rates drive up borrowers’ costs.

Dealmakers bought and sold 582 properties in the quarter, a year-over-year jump of 53 percent, according to a report by Ariel Property Advisors. Those transactions totaled $8.9 billion, a whopping 320 percent increase from the first quarter of last year and roughly in line with the first quarter of 2019.

Still, nearly half of those closings went into contract at the tail end of 2021, when the city saw a dramatic acceleration in investment sales, Ariel president Shimon Shkury said. The $15.6 billion worth of deals that closed in the fourth quarter — a three-year high — represented both an anomaly and a symptom of Covid’s lingering effects on the market, Shkury added, predicting that activity could slow in the second half of the year now that low pandemic-era interest rates are rising again.

“The first quarter marks a drastic change in the cost of debt and the expectation is that interest rates will continue to rise,” Shkury said. “As a result, we expect momentum to continue in the second quarter as both buyers and sellers rush to complete transactions, but we also expect the second half of the year to be somewhat slower.”

Investment in warehouses and other industrial properties have increased significantly, with 43 deals combining for $548 million, compared to just $164 million across 42 deals in the same period a year ago.

The multifamily market also continued to show signs of strength in the first quarter, with $3.2 billion worth of deals compared to $844 million a year ago.

Of the four boroughs covered in the report (Staten Island was excluded), Manhattan saw the largest year-over-year increases in deal and dollar volume, with 88 properties fetching $5.4 billion, a 676 percent increase from $696.4 million across just 39 deals in the first quarter of 2021. Those first-quarter figures paled in comparison to the fourth quarter, however, when 132 properties sold for a combined $8.5 billion.

The amount spent on multifamily properties citywide rose to $3.2 billion across 359 deals in the quarter, up from $843.7 million across 199 deals a year ago. In Manhattan, that number jumped 392 percent to $1.6 billion, from $329.4 million last year, while the number of deals increased 140 percent.

Article: https://therealdeal.com/2022/05/20/rising-interest-rates-will-dampen-citys-investment-sales-market-this-year/

A discount grocer nicknamed the “Kosher Costco” is headed to Long Island.

Bingo Wholesale plans to open a store in the Burnside Commons shopping center in Inwood, in a space that a Stop & Shop supermarket vacated in 2020.

“I want to … bring our wholesale prices in the supermarket business to that community,” said David Weiss, a principal at Bingo Wholesale.

Having leased 61,669 square feet at 603 Burnside Ave., Bingo Wholesale would be the largest tenant in the 100,219-square-foot Burnside Commons, according to Urban Edge Properties, the Manhattan-based real estate investment trust that owns the shopping center.

Both Urban Edge and Weiss declined to say when the new store is expected to open.

Bingo Wholesale has three stores, the first of which opened in Brooklyn in 2016. The other two stores are in Lakewood, New Jersey, and Spring Valley, New York, which is in Rockland County.

The retailer is affiliated with Osher Ad, a chain of 20 supermarkets in Israel.

Bingo Wholesale sells groceries, small appliances and other household goods.

“It’s [like a warehouse] club without paying membership,” Weiss said.

The retailer will bring a new concept to the area in response to high demand, Scott Auster, senior vice president and head of leasing at Urban Edge, said in a statement.

“A large-format kosher grocer with great prices is an ideal use for the local community and complements other essential offerings in the center,” he said.

Kosher food is defined as meeting the requirements of Jewish dietary law.

Kosher restrictions include not consuming meat that comes from animals that do not have split hoofs and do not chew their cud. Also, seafood that lacks fins and scales is prohibited.

One of the reasons Inwood was chosen for Bingo Wholesale’s new store is that it has a high percentage of Jewish residents, Weiss said.

Inwood and four other communities — Cedarhurst, Lawrence, Hewlett and Woodmere — informally comprise the Five Towns, in southwest Nassau County..

The Five Towns’ percentage of Jewish residents, an estimated 80%, is higher than anywhere else on Long Island, Rabbi Zalman Wolowik, director of Chabad of the Five Towns, a Cedarhurst-based community social services center that includes a synagogue, told Newsday in 2020.

The Stop & Shop that was in Inwood relocated 1.3 miles away to Woodmere in October 2020.

The 20-year-old store was moved because its lease was expiring and Stop & Shop wanted to expand the store’s offerings, which included a large selection of kosher products, the retailer said.

A developer may be forced to pump the brakes on a massive mixed-use project in Ronkonkoma, as a bus company owner is refusing to yield to an attempted seizure by eminent domain.

A depot operated by charter bus company North Fork Express stands in the way of the second phase of Tritec Real Estate’s $750 million Ronkonkoma Hub project, according to Newsday. Tritec has asked the Brookhaven Town Industrial Development Agency to condemn the depot, which sits on a 2.2-acre site on Hawkins Avenue near MacArthur Airport and Ronkonkoma’s Long Island Rail Road Station.

The IDA will hold a virtual public hearing on the issue Wednesday.

Municipalities use eminent domain when attempting to seize a property for a public purpose, such as parks or affordable housing. The Fifth Amendment requires municipalities to give owners “just compensation” for seized properties.

North Fork Express owner Greg Mensch said he could be willing to negotiate, but isn’t happy with the offer he’s received from Tritec.

“They want to give you what they want to give you and that’s it,” Mensch told Newsday. “They’re taking private property and they, the town, want to give it to a private developer.”

A spokesperson for Tritec said the firm prefers to negotiate.

Both sides have leverage. On the one hand, the town can seize the property and pay fair market value determined by an appraiser, which would result in Mensch losing the property, perhaps for less than he’d want for it. But Mensch could mount a legal defense and drag out the eminent domain process, driving up the project’s costs.

The initial phase of the Ronkonkoma Hub project wrapped up two years ago and the first tenants moved in three years ago. The second phase is expected to add 388 residential units, 74,000 square feet of retail, 17,000 square feet of offices and a village square for events.

Should it be completed, the development would contain 1,450 apartments, 195,000 square feet of retail and 360,000 square feet of offices.

In December, the IDA approved condemning more than a dozen properties, mostly small businesses, for the project. When the project was approved in 2014, the town and Tritec had said they had no plans to use eminent domain to acquire properties, according to Newsday.

Article: https://therealdeal.com/2022/05/17/holdout-threatens-massive-long-island-development/