A mixed-use property located in the heart of Bayville has traded for $3.9 million. 

22YRC Lo Properties LLC, an entity registered to a Mt. Sinai-based real estate investor, purchased the 9,494-square-foot building on .44 acres at 22 Bayville Ave. 

The fully occupied building has four two-bedroom, two-bath, rental apartments over four commercial spaces. The property also includes four garages behind the building. 

The sale price equates to a 7.37 percent cap rate. 

Tim Petrou and John Pszczola of Blue Shark Realty Group represented the buyer, while John Magnani of DGNY Commercial and Janine Fakiris and Giselle DiMasi of Daniel Gale Sotheby’s International Realty represented seller 22 Bayville Avenue LLC in the sales transaction. 

Article: https://libn.com/2022/08/15/bayville-mixed-use-property-sells-for-3-9m/

Here’s a quiz. What do GEICO, Publishers Clearing House, Dealertrack, Hains Celestial, Allstate, Marchon Eyewear, Equitable Advisors and Newsday have in common?

If you guessed that they are among a growing list of major companies looking to shed a sizeable amount of Long Island office space, you’d be correct.

Ever since the COVID-19 pandemic forced firms to allow employees to work remotely in the spring of 2020, companies have been trying to figure out how to navigate the new hybrid work environment. And though most businesses would rather have workers come into their offices, attracting and retaining employees in this period of high employment has prompted firms to continue to offer the option to work from home.

As a result, companies have been re-thinking their real estate requirements, and more firms are seeking to shrink their office footprints by subleasing or selling some of their existing space.

GEICO is doing both. The insurance giant had a deal to sell its 235,635-square-foot office building on 20 acres in Woodbury to a N.J.-based private equity and development firm last fall, but the sale fell through after the buyer’s plan to redevelop the site into a 24-hour logistics center ran afoul of Town of Oyster Bay covenants.

At the same time, GEICO leased 200,000 square feet at The We’re Group’s office complex at 1 Huntington Quadrangle in Melville, where it planned to relocate in the fourth quarter of 2023. However, the Chevy Chase, Md.-based company, a wholly owned subsidiary of Berkshire Hathaway, has recently put the Melville space out for sublease and Cushman & Wakefield is once again marketing GEICO’s Woodbury office property for sale.

Shaving space

By: David Winzelberg August 11, 2022

Here’s a quiz. What do GEICO, Publishers Clearing House, Dealertrack, Hains Celestial, Allstate, Marchon Eyewear, Equitable Advisors and Newsday have in common?

If you guessed that they are among a growing list of major companies looking to shed a sizeable amount of Long Island office space, you’d be correct.

Ever since the COVID-19 pandemic forced firms to allow employees to work remotely in the spring of 2020, companies have been trying to figure out how to navigate the new hybrid work environment. And though most businesses would rather have workers come into their offices, attracting and retaining employees in this period of high employment has prompted firms to continue to offer the option to work from home.

As a result, companies have been re-thinking their real estate requirements, and more firms are seeking to shrink their office footprints by subleasing or selling some of their existing space.

GEICO is doing both. The insurance giant had a deal to sell its 235,635-square-foot office building on 20 acres in Woodbury to a N.J.-based private equity and development firm last fall, but the sale fell through after the buyer’s plan to redevelop the site into a 24-hour logistics center ran afoul of Town of Oyster Bay covenants.

At the same time, GEICO leased 200,000 square feet at The We’re Group’s office complex at 1 Huntington Quadrangle in Melville, where it planned to relocate in the fourth quarter of 2023. However, the Chevy Chase, Md.-based company, a wholly owned subsidiary of Berkshire Hathaway, has recently put the Melville space out for sublease and Cushman & Wakefield is once again marketing GEICO’s Woodbury office property for sale.

The sale and sublease represented a major downsizing of the company’s Long Island office space, as many of its employees continue to work remotely. GEICO did not respond to requests for comment on its real estate plans.

Though brokers acknowledge the increased availability of sublease space, they point out that the overall Long Island office market is holding its own, buoyed by high employment and a finite supply of Class-A space.

“Excluding sublets, Long Island office market fundamentals remain relatively stable,” says Adam Rochlin, principal of The Rochlin Organization brokerage firm. “While many national office tenant employees may still be working from home, the rent for office space is still being paid, and leases can run for many years. Landlords are not feeling the pain of vacant space, and they’re not desperate.”

The overall vacancy rate for Long Island office space was 13 percent in the second quarter, with available sublease space accounting for 20 percent of all office vacancies, according to a report from Cushman & Wakefield. Supply of office space here has outpaced demand for the last 11 quarters, and there was negative absorption of 566,000 square feet in the first half of 2022.

Rochlin said while sublet space is abundant, it’s difficult to conclude a deal with.

“We often refer to the national sublet market as ‘shadow space,’ and it can be riddled with landmines at every turn, including the possibility of a master tenant default, that could terminate sublet tenancy, and unanswered complaints that can make tenancy uninhabitable. Tenants tend to stay away from such liability unless the discount is significant.”

Brian Lee, a principal and executive managing director of Newmark, says there has been a flight to quality for Long Island office tenants and noted that Class-A office properties have much higher occupancy rates, while most of the available sublease space is in less desirable buildings.

“I think the main punishment here is going to be in Class-B buildings, the commodity space that doesn’t have the amenities, that’s old, that’s tired,” Lee said. “That’s where you’re going to see the problems. When you look at the buildings that are being sublet, you’re not looking at the A buildings, you’re looking at the B buildings.”

In fact, there was about 600,000 square feet leased at Long Island Class-A office buildings in the second quarter, while just 212,000 square feet was leased at Class-B buildings, according to the C&W report.

Overall asking rents for Long Island office space rose to $32.06 in the second quarter, and David Pennetta, executive managing director for Cushman & Wakefield Long Island, said the strength of office rents is a sign of landlord confidence. It also reflects the area’s finite supply of desirable office space.

“The last speculative office building over 100,000 square feet developed in Nassau County was constructed in 2005 and in Suffolk County it was 2009, so we don’t have any new supply to absorb,” Pennetta said. “Also, the medical sector has consumed a steady supply of office space, further shoring up its resilience. With the amazing strength of the industrial sector, we have even seen some major office buildings being converted to distribution warehouses.”

Still, with softening demand and increased supply of sublease space, the Long Island office market remains in a state of flux. For clients of CBRE broker Martin Lomazow, a tenant-rep specialist for large office transactions, that represents opportunity.

“We are having a very good time representing our clients looking for space, because there’s ample space to choose from. That makes this a very good time to be in the market as a tenant,” Lomazow said. “Plus, if you have a strong enough tenant, you can often convert sublease space to direct leases.”

And though some stats shine a positive light on the office market, Lomazow believes the systemic office-occupancy issue will become more apparent over time.

“At least half of larger companies are going on record that they’re going to be reducing their footprints and that’s nationally,” Lomazow said. “You also have the possibility of a looming recession, and when companies are confronted with a decision whether to give up space or employees are going to be far more inclined to give up space, since it’s proven that they can exist with a reduced footprint.”

Many brokers say the work-from-home trend is not universal and seems to be most prevalent with certain types of businesses.

“Process-driven work, which doesn’t require creativity and collaboration, is ideal for working from home. You’re typically on your computer processing information, whether it’s processing orders, claims, or other functions,” Lee says. “Bigger corporations have more of that process-oriented work. When people need to do collaborative work, like lawyers, accountants, and other creative professionals, that is more of an environment where people want to work together and need to be together, and you can’t just do it on Zoom all the time.”

Pennetta agreed with that assessment.

“Certain industries are more compatible with working from home, but there is no one-size-fits-all solution as each company will look different depending on its objectives,” Pennetta said. “I personally think having younger professionals working unguided and autonomously by themselves could lead to cultural issues and result in the younger workforce changing jobs more often.”

Meanwhile, out of all of Long Island’s commercial real estate sectors, the office market remains the one with the most question marks and uncertainty moving forward. And it’s major events like COVID that can move the needle one way or the other.

“Before 9/11, everyone was looking to create corporate campuses. Then 9/11 happened and everyone wanted to disperse and, 10 years later, they all moved back to the city,” Lee said. “To me it’s a fascinating time to see what the future of work is going to be, what people are doing. I think the office is far from dead. I think whenever the pendulum goes one way, everyone says it’s never coming back. Of course it will, but to what extent remains to be seen.”

Article: https://libn.com/2022/08/11/shaving-space/

GYMGUYZ, a growing mobile fitness company has expanded in Melville after purchasing an office property for $3.5 million. 

The business has relocated from leased space in Plainview to the 18,000-square-foot building on .92 acres at 600 Broadhollow Road the company acquired a few months ago. 

GYMGUYZ has so far invested another $400,000 in renovations to the property, where it occupies the second floor and basement. Bank of America leases about 8,000 square feet, mostly on the Melville building’s first floor. 

The company’s founder is Josh York, a former personal fitness trainer who grew up in New Hyde Park. After graduating from Long Island University in Brookville, York took a marketing job, but he soon decided to return to the personal training business. 

York started the mobile training company out of his parent’s dining room in 2008, spending his life savings of about $15,000 to buy a Ford E250 van that he filled with exercise equipment. Five years later, York began franchising the concept and it has been flexing its muscle ever since. 

Today, GYMGUYZ, which stands for “Get You Motivated Goals Uniquely Yours Zero (excuses),” has sold more than 150 franchises that serves nearly 1,000 cities across the U.S., Canada and the U.K. York says the company has 40 more franchise in the pipeline for 2022 and it expects to add between 75 and 100 more franchise locations next year. 

“So many people told me it was a stupid business model and that I should just open up a gym,” York told LIBN. “All those detractors never stopped my drive and determination.” ‘

The new building will feature a training facility to train the company’s franchise partners and corporate team members, as well as a content studio with a set that recreates a client’s home for training. It took York 15 years to have windows in his office, after staring at basement walls all that time.  

“Now we have an actual world headquarters, from which we’ll sell tons of franchises,” he said. 

The cost of a GYMGUYZ franchise ranges from $66,000 to $131,000, depending on the size of the territory. For their investment, franchisees get a fully-appointed van packed with 365 pieces of workout equipment, including free weights, trampolines, battle ropes and other gear trainers bring to each client’s location. In addition, franchisees receive proprietary management software, local phone number, website and several days of training. 

GYMGUYZ charges $85 to $105 per mobile workout for individuals and also offers group training. 

“Due to demand within the last two years, we’ve expanded our services heavily into the business-to-business sector, adding corporations, senior living facilities and condo communities to our client list,” York said. 

The company has made lists of fastest-growing franchises and earned other accolades in the last several years. 

“But the best reward is when you get a call from a mother of an autistic child who was functioning at a low level and now because of our workouts is functioning at a higher level,” York said. “We’re in the business of helping people. It’s great to make a living, but it’s much better to make a difference.” 

Desmond Cassidy of DGNY Commercial represented the buyer, while Chuck Tabone and Dan Oliver of Newmark represented seller 600 Route 110 LLC in the Melville sales transaction.

Article: https://libn.com/2022/08/11/mobile-fitness-firm-expands-with-3-5m-melville-deal/

Construction has begun on a $50 million mixed-use project in Roslyn. 

Developer JK Equities was able to break ground on the transit-oriented project at 281-301 Warner Ave. after securing a $35.8 million construction loan provided by Provident Bank. 

Designed by Mojo Stumer Architects, the development will bring 54 rental apartments over 6,600 square feet of retail space to the property located a short walk to the Roslyn Long Island Rail Road station that was formerly occupied by a blighted strip of vacant retail stores. 

The Roslyn project received economic incentives from the Nassau County Industrial Development Agency and was recognized as a Top Mixed-Use Project by Long Island Business News’ 2022 Real Estate, Architecture & Engineering Awards. 

“This is yet another significant milestone for this development since our acquisition in 2019, we are ecstatic for construction to begin,” Jerry Karlik, principal of JKE, said in a company statement. “After gaining approval of our plans, and working with our team, we are happy that this project, part of the Industrial Development Agency program and Brownfield Cleanup Program, will be delivering a new, walkable and transit friendly development for this neighborhood that I’ve lived in and cherished for many years.” 

The 105,000-square-foot project includes parking for 130 vehicles and as many as 30 electric-vehicle charging spots. A portion of the one- and two-bedroom apartments will be designated as workforce housing and leased at reduced rents.  

Mark Stumer, founding principal of Mojo Stumer, said the new building’s architecture has a very distinct character and form. 

“With a dynamic material palette of wood, black brick, and concrete-look porcelain, the façade design visually breaks the building down to smaller components as it wraps the substantial grade changes across the property,” Mark Stumer, founding principal of Mojo Stumer, said in the statement. “The result is a creatively designed, and site-responsive piece of architecture which will be an exciting new landmark at this southern entry point to the Village of Roslyn.” 

The development is expected to be completed in early 2024. 

Article: https://libn.com/2022/08/09/work-starts-on-50m-mixed-use-project-in-roslyn/

More than 11 million square feet of warehouses have been proposed for Long Island by developers looking to profit from record-low vacancy rates, high rents and the seemingly insatiable needs of Amazon and other businesses for storage space.

The new projects together would equal more than 25 Nassau Coliseums.

Commercial real estate companies plan to spend more than $2.4 billion on 25 warehouse projects from Woodmere to Westhampton Beach, according to data compiled by Newsday. Most of the facilities are slated to open later this year or in 2023 and 2024.

But whether all the proposed warehouses move from blueprints to shovels in the ground is far from certain. Experts said the market could become oversaturated as potential tenants reconsider their space needs because of the slowing economy, a reduction in consumer spending and higher interest rates.

Few of the projects have tenants yet. The exceptions are in Melville, Syosset and Woodmere, where Amazon has signed leases for buildings that will be used to deliver packages on the “last-mile” to customers’ doorsteps, the database of publicly-announced projects shows.

The planned buildings — unlike the Island’s existing 180 million square feet of industrial space that was built decades ago — will have what firms are increasingly looking for: high ceilings, fewer internal columns holding up the roof, lots of truck bays and ample parking, according to the experts.

They said multiple factors are behind the warehouse boom.

“We’re adding a significant amount [of warehouse space] at one time, and one of the reasons is last-mile delivery by Amazon and others — but that’s not the only thing that has been happening,” said David Pennetta, executive managing director of the Long Island office of Cushman & Wakefield real estate brokers.

He said the number of warehouses has declined in the past few years as some are demolished to make way for apartments and offices, often near train stations in downtowns. At the same time, national companies want to open distribution centers here to serve the metropolitan area, and companies from New York City are seeking space in Nassau and Suffolk counties.

“So, you have a contraction of supply,” Pennetta said.

Warehouse vacancy rates on Long Island have plummeted from 11.4% in 2012 to 2.3% today. As a result, rents have soared in the period, going from $6.79 per square foot, on average, to $14.52, according to Cushman & Wakefield.

Pennetta and others also credited the Home Depot warehouse on Duffy Avenue in Hicksville with causing international and national development companies to see opportunity in a region that they bypassed for decades.

The 195,610-square-foot facility was constructed in 2019-20 by Lincoln Equities Group LLC of East Rutherford, New Jersey. Lincoln then quickly sold the building for a record amount after negotiating a lucrative rental agreement with Home Depot.

“It was the first new speculative industrial property built on Long Island in 15 years and [the owner] wound up getting almost double what the market was in rent,” Pennetta said. “That big jump up in rent got people’s attention and sort of started this big rush” of warehouse construction.

Out-of-state players

Among the new arrivals with projects under way or in the government approval process are New Jersey-based Hartz Mountain Industries; Kansas City, Missouri-based NorthPoint Development; San Francisco-based Prologis; Manhattan-based Brookfield Properties and Rockefeller Group International; and Rosemont, Illinois-based Venture One Real Estate.

Venture One has been studying Long Island for more than two years as part of a larger strategy to expand beyond its Midwest base, said Brian McDonagh, a company vice president.

He said Venture One plans to build a total of 320,416 square feet in three warehouses — two along Veterans Memorial Highway in Bohemia and Ronkonkoma and another in the Hauppauge Innovation Park. Together, they will cost $89.5 million.

“We saw an opportunity to really deliver additional cost savings to corporate users who manufacture on the Island and those trying to serve the Island from New Jersey or the city,” McDonagh said, citing a 50% increase in freight costs because of higher gasoline prices and the shortage of truck drivers and warehouse workers.

Venture One also has been acquiring small warehouses in Suffolk but has no interest in converting vacant big-box stores, malls and strip shopping centers to distribution centers.

“The dollars that you would need to invest in those structures to make them functionally usable, a lot of times it doesn’t make sense…Better to scrap them and start over,” McDonagh said. “The other issue is that a lot of brick-and-mortar retail sites on Long Island don’t have direct access to the LIE, which is incredibly important for industrial/warehouse development because trucks cannot use the parkways.”

Half of the two-dozen proposed warehouse projects are near the LIE, some less than a mile from an entrance ramp or along the Service Road, according to the Newsday database.

Developers from outside of Long Island aren’t the only ones diving into the local warehouse market.

Last year, BEB Capital in Port Washington formed a joint venture with the Rockpoint Group, a private equity firm in Boston, to purchase up to $1 billion in existing warehouses, factories and offices in the Northeast, “with a primary focus” on Nassau and Suffolk, according to executives.

“There’s a significant pipeline [of proposed warehouses] that Long Island has never seen before,” said Lee J. Brodsky, CEO of BEB, which his father started in 2017. The joint venture “allows us to move quickly to acquire existing [buildings] ahead of the completion of the new construction” by competitors, and to hopefully snag additional tenants.

BEB owns nine industrial/warehouse buildings locally – two bought via the joint venture.

Brodsky said demand for spaces under 100,000 square feet, his company’s specialty, remains robust. “We haven’t seen a leasing slowdown, though we are reading about change in e-commerce strategies,” he said, referring to online retailers that are scaling back their warehousing plans.

With slower growth in online shopping compared with 2020’s feverish pace, Amazon has moved out of some of its warehouse space nationwide. The retailer is not renewing leases or terminating them early, and in some cases, subleasing space to others.

Amazon has plans for at least nine last-mile warehouses in Nassau and Suffolk – but it’s also closing its warehouse at 201 Grumman Rd. W. in Bethpage this summer.

About 500 affected employees will be transferred to other sites, notably a new 204,000-square-foot facility on the former Cerro Wire site in Syosset. The Bethpage location, which is 161,360 square feet and was built in the late 1990s for Goya Foods, has been used for Amazon deliveries since 2016.

“We continually evaluate our operations network to ensure our buildings provide a modern, engaging and technologically-advanced environment that creates the best possible experience for our employees and our customers,” said company spokesman Steve Kelly. “In some cases, as with our Bethpage delivery station, the best option for our employees and customers was not to renew the lease of an older facility.”

The ranks of warehouse workers, couriers and messengers have swelled since 2017, according to Shital Patel, an analyst at the state Department of Labor’s Hicksville office.

She said, “Employment in warehousing and storage on Long Island grew by an unprecedented 52% from 2018 to 2019,” from 2,623 jobs to 3,986. While the number of employees dipped in 2020 due to the pandemic shutdown, by the end of last year, it had recovered to 3,888.

The courier/messenger sector, which includes package delivery, has added even more jobs: up 2,730 from its pre-pandemic level to 10,930 last year, Patel said.

Later this year, Amazon is expected to begin operations at a new 91,000-square-foot warehouse in the Hampton Business District, near Gabreski Airport in Westhampton Beach. The district is being developed by Rechler Equity Partners of Plainview, which says it’s Long Island’s largest owner of commercial property, with 6.5 million square feet in more than 100 buildings.

Mitchell Rechler, the firm’s co-managing partner, said it’s happy to have Amazon as a tenant, but is focused primarily on meeting the needs of local manufacturers and distribution companies.

“Amazon entered the market a few years ago and it drew a tremendous amount of local media attention for good reason,” he said. “But that’s not what the market is all about… Many of our tenants have expanded over the last few years” and rented additional warehouse space to accommodate their increased sales and to stockpile materials because of supply chain disruptions.

Rechler Equity tenant East/West Industries Inc., a defense contractor in Ronkonkoma, leased an additional 27,000 square feet of warehouse and production space in a multi-tenant building on Orville Drive North in May. The building has been home to the East/West office and factory for six years but the company’s warehouse was across the street.

Teresa Ferraro, president and CEO of East/West, said having its operation under one roof, in 75,000 square feet, is critical to winning new orders from aerospace giants such as Boeing, Lockheed Martin, Northrop Grumman and Sikorsky. East/West, which has 88 employees, produces seats for military helicopters and airplanes and survival kits with oxygen for air crews to use in emergencies.

“If we didn’t show growth and expansion, they probably wouldn’t have given us additional contracts,” Ferraro said, adding her customers want their suppliers to have ample warehouse space and orderly production processes. “It’s a risk to them if we are busting at the seams.”

Options for smaller tenants

Gregg Rechler, co-managing partner and Mitchell’s cousin, said many of Rechler Equity’s tenants are in need of additional space.

That’s why the firm is proposing the fourth-largest project in the database based on square footage: Rechler Business District, to be located off Horseblock Road in Medford. The $220 million project will consist of 845,000 square feet over six or seven buildings.

“While a lot of our competitors plan to build big boxes that are 400,000 square feet, 800,000 square feet, our intention with Medford is different… The first building will be 141,000 square feet that can be subdivided into spaces of 20,000 square feet or even 10,000 square feet,” Gregg Rechler said.

The largest project planned for the Island is from Kansas City’s NorthPoint Development and West Babylon-based garbage hauler Winters Bros. Waste Systems: the Long Island Rail Terminal on Sills Road in Yaphank.

The $506.5 million project, to be built on land owned by Winters Bros., consists of 2.5 million square feet over four buildings. It differs from all the other planned facilities in that it has a railroad link as well as proximity to the LIE.

Rail link offers benefits

Kyle Strober, executive director of the developers’ group Association for a Better Long Island, said the rail link provides multiple benefits, including that “consumers will receive products faster while usage of freight rail will reduce the number of trucks on our roads.”

Lisa M.G. Mulligan, CEO of the Brookhaven Town Industrial Development Agency, agreed, adding the IDA awarded NorthPoint and Winters Bros. $73.5 million in tax breaks over 15 years because of the project’s rail component and potential to create up to 1,300 jobs.

“I don’t have a lot of projects that come across my desk that say, ‘as a result of this, there will be more than 1,000 people employed,’ ” she said. 

Still, the Brookhaven IDA has commissioned a study to determine how many new speculative warehouses are needed in Suffolk, with an eye toward preventing a glut of unused space. Many of the 25 announced projects have either won tax breaks from Long Island’s eight IDAs or applied for them.

“We felt that we needed a better understanding of how much [warehouse space] can be absorbed – where is the tipping point,” Mulligan said.

Experts said economic forces, such as inflation, difficulty in obtaining financial backers and a possible recession, will determine whether all the blueprints become buildings.

Pennetta, the Cushman & Wakefield executive, isn’t worried about oversaturation.

“Not everything that’s on the table right now is going to move forward,” he said. “The market will self-adjust. There’ll be a natural correction, not a crash.”

Articles: https://www.newsday.com/business/amazon-warehouse-factory-long-island-mdxu3ri9

The developer of an Amazon warehouse on Ruland Road in Melville is giving up nearly $5 million in tax breaks because the online retailer isn’t sure it can meet the job commitment, according to documents and sources.

Hartz Mountain Industries Inc., in a May 26 letter, to the Suffolk County Industrial Development Agency, said it wished “to terminate the lease and project agreement, company lease agreement and related other agreements” that granted the tax incentives over 20 years.

James P. Rhatican, the executive with New Jersey-based Hartz Mountain who signed the letter, didn’t respond to requests for comment on Wednesday. The letter and other documents were obtained by Newsday via a Freedom of Information Law request.

Amazon wasn’t party to the Hartz Mountain-IDA agreements because the retailer didn’t sign a 10-year lease for the 276,500-square-foot warehouse until later. However, Amazon wasn’t certain it could meet the agreements’ stipulation that 175 jobs be created within two years of the facility’s opening, according to a source familiar with the situation.

The documents show that the IDA tax breaks were terminated on July 1. Hartz Mountain put $1.9 million into an escrow account for the repayment of sales taxes that were exempted on the purchase of construction materials and furnishings for the warehouse under the IDA deal.

Kelly Murphy, the IDA’s deputy executive director, said on Wednesday the amount of sales-tax savings to be clawed back cannot be determined until construction has been completed. She said the other tax benefits — up to $274,107 off the mortgage recording tax and $2.7 million in property-tax savings over 20 years — hadn’t yet been used and are now terminated.

“This recapture is … required by the contractual documents that they entered into,” Murphy said, referring to Hartz Mountain. “This is not common [among IDA projects] but it’s not unusual … This has been very straightforward,” she said.

The $52.8 million warehouse is one of two that Hartz Mountain is constructing on the site of the former Newsday headquarters on Pinelawn Road. The other warehouse is 669,186 square feet and its IDA tax breaks remain in effect, according to Murphy.

However, the future tenant or tenants of the larger building will have to create 500 jobs within two years of opening — an increase of 75 positions — because the tax-aid deal for the Amazon warehouse has been terminated, under an amendment unanimously approved by the IDA board in December.

News of the tax-break termination on Amazon’s Melville warehouse comes as the retailer faces the prospect of losing IDA aid for a soon-to-open warehouse in Syosset.

The Nassau County IDA is considering whether to claw back about $11 million in tax incentives awarded to developer Syosset Park Development LLC and Amazon for the Syosset facility now that the retailer is closing one of two Bethpage warehouses and transferring employees to Syosset. Amazon had pledged to create 150 new jobs in Syosset.

“Amazon will be on the agenda and up for discussion at our Aug. 11 meeting,” IDA chairman Richard Kessel said on Wednesday.

Article: https://www.newsday.com/business/amazon-ida-tax-breaks-hartz-mountain-melville-warehouse-fs6y1zw3

Hanover Community Bank will be opening a new office in Hauppauge. 

Hanover leased 6,850 square feet on the third floor of the newly built office property at 410 Motor Parkway. 

The bank, owned by publicly traded Hanover Bancorp, will use the new space as an office and bank branch, and expects to open the new location by the end of the year. This will be the bank’s third Long Island office, following Mineola and Garden City Park. It has other locations in Manhattan, Forest Hills, Flushing, Sunset Park, and Freehold, N.J. 

“This move east will support the vibrant businesses and residents of the Suffolk County area and has long been a part of our strategic expansion plans,” Michael Puorro, Hanover’s chairman and CEO, said in a company statement. “Logistically, this location allows us to further service the Long Island business community with commercial, municipal, and retail banking products. This area is particularly void of institutional banking choices due to the ongoing, robust consolidation activity within our industry.” 

The new 35,000-square-foot building at 410 Motor Parkway was a $15 million speculative project for its developer Aresco Management. Completed late last year, the four-story building on 3 acres at the entrance to the Long Island Innovation Park at Hauppauge replaced an old one-story industrial building and is the first spec office building to be constructed on Long Island in the last dozen years. 

The Hauppauge office building, designed by John Seifert of Huntington-based WSJS Architects, reserved its first floor for food business. So far, Mógū Modern Chinese Kitchen, which has other locations in Farmingdale and Commack, has leased about 2,000 square feet and Jersey Mike’s Subs has leased about 1,700 square feet at the Motor Parkway property. Both eateries are expected to open before the end of the year. 

Ron Epstein of RC Commercial Partners represented Hanover Bank and Russel Helbling, formerly with Sabre Real Estate Group and now with Katz & Associates, represented Mógū, while landlord Aresco Management was self-represented in the lease transactions. 

Article: https://libn.com/2022/07/27/hanover-bank-expanding-with-office-in-new-hauppauge-building/

An $11.5 million redevelopment project that will bring a new boutique hotel to Westhampton Beach has received preliminary approval for economic incentives from the Suffolk County Industrial Development Agency. 

Melville-based Peconic Equities will be transforming the former Grassmere Inn into a 16-key luxury hotel called Seven Beach Lane, which is also the address of the property.  

The redevelopment project will restore the original inn and create a new, modern addition to the back of the building, connecting the old historic style with contemporary design. The new Westhampton Beach hotel is designed by Patchogue-based bld Architecture and Melville-based Beth Donner Design is its interior designer. 

Amenities at the new hotel will include an outdoor pool and bar, as well as an indoor restaurant and lounge for hotel guests. Located on a 1-acre property in the center of Westhampton Beach, Seven Beach Lane is a stone’s throw from downtown restaurants, shops, and galleries. It is also less than two miles from Rogers Beach on Dune Road, a popular public beach that serves the Westhampton area. 

“The Seven Beach Lane hotel project is not simply focused on adding much needed hospitality space, but creating a new tourist destination in one of the most sought-after portions of the Hamptons due to its ease of access and world-class beaches,” Suffolk IDA Executive Director Tony Catapano said in an agency statement. “The IDA is pleased to be a part of this unique project that will be an attraction for out-of-region visitors and a boon for local merchants in downtown Westhampton Beach.” 

Corey Gluckstal, principal of Peconic Equities, said the project couldn’t get done without the support of the IDA. 

“We have no plans of this being your typical hotel,” Gluckstal said in the statement. “People will select this location for their stay because it provides amenities and a location that makes it a destination within itself. We are excited to get this project underway and add one more place on Long Island’s East End that can attract new customers for many local businesses.” 

Construction on the hotel project is expected to start in September. 

Article: https://libn.com/2022/07/29/east-end-hotel-project-gets-suffolk-ida-assist/

A Planet Fitness has moved into what was left of the former Best Market grocery store space in West Babylon.

The gym and discount grocer Lidl have split the space in the West Babylon Town Center.

The gym, which opened July 17  at 533 Montauk Hwy., occupies 21,700 square feet, while Lidl, which opened in September, occupies 36,000 square feet, said Robert Goldfeder, director of leasing for Woodmere-based real estate developer Basser-Kaufman, which owns the shopping center.

More than 90% of Planet Fitness’ 2,291 gyms in North America and Australia are franchises, but the location in West Babylon is corporately owned.

“The gym features state-of-the-art cardio machines and strength equipment, 30-minute express circuits, numerous flat-screen televisions and clean, spacious locker rooms and showers,” Hampton, New Hampshire-based Planet Fitness said in a statement.

There are 25 Planet Fitness gyms on Long Island.

Lidl, a German chain, bought 27 grocery stores from Bethpage-based Best Market in 2019, including all 24 of the Best Markets on Long Island.

The store in West Babylon was among the last three Best Markets on Long Island to be closed for renovations and conversions to Lidl stores.

West Babylon Town Center is a 128,221-square-foot property whose other tenants include Big Lots, PetSmart, Starbucks and Bethpage Federal Credit Union.

Article: https://www.newsday.com/business/planet-fitness-lidl-best-market-grocery-store-west-babylon-sei9o01g

Mill Creek Residential Trust has been chosen by the Metropolitan Transportation Authority to develop a transit-oriented rental project at the Westbury Long Island Rail Road station. 

Boca Raton, Fla.-based Mill Creek beat out several other developers, including RXR, the Albanese Organization and L+M Development Partners, that participated in the MTA’s request-for-proposals process to build an apartment complex on the agency’s 1.6-acre surface parking lot on the south side of the Westbury train station on Railroad Avenue. 

Mill Creek has proposed two “scenarios” for the project: a 250-unit, 255,000-square-foot building and a 200-unit, 215,000-square-foot building as a “fallback” plan, according to the MTA. 

To accommodate the project, the MTA built a 683-space parking garage on the north side of the Westbury station that was completed in August 2021. The $23 million, three-and-a-half story parking structure was built on village land leased to the MTA as part of its Third Track project, which freed up its south parking lot for development. 

Mill Creek will be entering into a 99-year ground lease for the development site, with annual payments starting at $650,000 or $610,000, depending on which project scenario is approved, with 2 percent increases each year, the MTA says. 

The Village of Westbury created a new downtown zoning district in Dec. 2019 to allow for more dense development of multifamily and mixed-use projects in a 50-acre area near the LIRR station, and several new developments are already underway. 

Upon completion of an environmental review process and adoption by the MTA Board and the LIRR Board, the MTA will finalize agreements with Mill Creek and the developer will then complete the project’s design for the property, according to MTA documents. 

But the project will also need to gain approval from the village. The village’s new zoning allows 102 units per acre and caps building heights at five stories, so either of Mill Creek’s plans would need a variance to get approved. 

“We are pleased that Mill Creek has been selected by the MTA as the developer for the MTA’s property adjacent to the train station,” Westbury Mayor Peter Cavallaro told LIBN. “Mill Creek has completed a number of very successful projects in the region and is one of the leaders in transit-oriented development on Long Island and beyond.  As we have not yet received any specific information or application from the developer, we can’t comment on any specifics, but we look forward to working with Mill Creek and the MTA on their application when submitted to make sure that a project is crafted that is beneficial to the community and that fits within and achieves the goals and intent of our TOD zone.” 

A Mill Creek executive has yet to respond to a request for comment. 

Article: https://libn.com/2022/07/22/mta-taps-mill-creek-for-tod-project-at-westbury-lirr-station/