What is the future of the
Streuver Fidelco Cappelli (SFC) $1.6 billion plan to redevelop
downtown Yonkers? Will the project still move forward, or will
it be be scaled back or halted completely?
The answers to these questions depend on who you ask.
SFC Project Manager Peter Klein, who was in Yonkers this past
Tuesday for the Downtown Waterfront Business Improvement
District (BID) Sunrise Seminar Series at the Riverfront Library,
said, “There are a lot of rumors about whether SFC is pulling
out of Yonkers. The rumors are not true, but, like every
business in this economy, we have to adjust our timeline to work
through this period.”
“We are not done, but we will have to do things differently. We
are looking at phasing in and adjusting our construction
schedule,” said Klein, who declined to give more details about
what SFC’s specific adjustments will be.
Off the record, several members of the Yonkers business and
development community claim that the project is in doubt, for
the following reasons:
• The tightening financial markets have/has restricted available
credit, and if available, is much more expensive than in the
past. Ten percent interest on commercial loans is not
unusual. SFC has a line of credit established with the Bank of
Scotland, not to be confused with the Royal Bank of Scotland,
which recently took a nosedive and had to be bailed out by the
British government.
• The retail markets are in a process of consolidation and
bankruptcy, not expansion into new markets. Circuit City, one
interested client in the SFC Yonkers project, has filed for
bankruptcy. Acquiring retailers to sign a lease for any new
space is almost impossible. Retailers are also having trouble
getting credit from banks to proceed with any new store
openings.
While SFC has a large line of credit with the Bank of Scotland,
it is for the actual construction of the project, which is still
months away from final approval. In the meantime, SFC must pay
for the predevelopment costs of selling this project to the City
Council and the public and for the attorneys, architects and
engineers. Also included in this figure is the cost of
acquisition of properties, which is surprisingly minimal.
SFC has purchased very few properties in the downtown area it
proposes to transform, but has options to purchase the
properties with almost all of the downtown merchants and
property owners.
It is estimated that SFC has spent over $20 million in these
predevelopment costs, and are seeking a $5 million line of
credit. Rumor has it that Westchester developer and SFC
partner Louis Cappelli has approached the city in an effort to
get the city to help in some way to get the $5 million line of
credit, through use of Federal Housing & Urban Development
funds.
Considering the city’s dire budget situation, this request is
said to have been difficult to swallow at City Hall and by
affordable housing advocates.
City Council President Chuck Lesnick laid out a timeline for
future council debates and negotiations with SFC in the months
ahead. Lesnick explained that several approvals and agreements
need to be completed before the project can break ground.
They include:
• Westchester County needs to approve the proposed $190 million
Tax Incremental Financing (TIF) to pay for city infrastructure
improvements in and around the downtown.
• Land Disposition Agreement (LDA): This is the biggest piece in
the negotiations between SFC, Mayor Phil Amicone and the City
Council, and includes a list of suggested items that developers
can pay for, in exchange — at fair market value — for city
parcels of property required for the project to happen,
including two prime riverfront properties known as the H&I
parcels. Lesnick said that LDA negotiations have been ongoing
since October, and have been of a “co-operative tone. I don’t
imagine that our negotiations will conclude until after the
county makes its approvals.”
• Community Benefits Agreement (CBA): Little or no negotiations
between the developer and community groups have yet to occur.
Although not required to approve the project, a CBA is seen as a
sign of good faith for a developer to agree to certain benefits
to those who already live in downtown Yonkers, like affordable
housing and job training. Lesnick also said that developers
usually wait 90-120 days after the Environmental Impact
Statement is approved to see who — if anyone — will bring
litigation against the project. Possible litigants against SFC
could be Scenic Hudson, American Sugar, CH Martin or any Yonkers
resident. “Nobody can accuse us of not taking a hard look at
this project. Critics can say we took too long, but this was the
mother of all scoping and EIS documents,” Lesnick said.
