Avalon East for sale.... New Rochelle Taxpayers to be fleeced again as wealthy conglomerate seeks to sell tax abated skyscraper

Time to read
4 minutes
Read so far

Avalon East for sale.... New Rochelle Taxpayers to be fleeced again as wealthy conglomerate seeks to sell tax abated skyscraper

May 10, 2013 - 23:19

Avalon East, otherwise known as Avalon 2, is being offered for sale exclusively by Holliday Fenoglio Fowler, LP (HFF), a Texas Limited Partnership. The listing cites a 39-story tower with 588 market rate apartments (98% occupancy as of 5/7/13) and 7,607 square feet of ground floor retail (32% economically occupied).

This listing adds insult to injury after Avalon 1 was sold to Hartz Mountain with the remainder of the 30-year tax abatement intact. The current listing also boasts, “The property benefits from a PILOT (payment in lieu of taxes) agreement with the City of New Rochelle” through 2035. (emphasis added).

This is another glaring example of what happens when savvy corporate wheel-dealers negotiate with politicians only interested in attaining higher office. While this will be dumped on the New Rochelle Industrial Development Agency (NR IDA) make no mistake it is the New Rochelle City Council who must sign off on any sale agreement.

There are may side stories, or should I say horror shows here, one worst than the other. First, let’s remember that in order for the sale of Avalon 1 to be completed, the City had to grant a parking variance to Avalon East. At that time there was no renegotiation of the contract in terms of the PILOT and although the original agreement allows the transfer of the PILOT the City chose a quick money grab of $9 million for the property as opposed to reducing the length of the PILOT, hanging the taxpayers of New Rochelle out to dry.

Avalon East will be a very attractive sale because it comes with a PILOT that permits the purchaser to avoid paying over $7 million a year in City, School & Library taxes. Add to that another $1.5 million for cost taxpayers must bear to educate the students from Avalon East and any potential buyer is up $8.5 million going into negotiations.

When the smoke clears, I believe the City will agree to a price with transfer of the PILOT for a pittance, as they did for Avalon 1, in an attempt to plug a projected $29 million shortfall.

30-year tax abated buildings being sold less than 10-years into their PILOT’s, over $10 million in lost in City, School & Library taxes and over $3 million taxpayer dollars to educate the children from the Avalon Project while firefighters, police officers and DPW staffing’s plummet to new lows putting public safety at risk. All this while Mayor Bramson touts a $15 million net benefit from development in a feeble attempt to sell the Echo Bay development.

There are 7 Comments

The idea behind tax abatements was to bring follow-on development with positive economic value, and yet the retail space is only 32% occupied. Very disappointing.

Adam is correct, New Rochelle's development in total is very dissapointing. Another major factor behind tax abatements was job creation both during construction and permanant when completed. New Rochelle ranked second to last in that category in the 2010 State Comptrollers Report on IDA's. New Rochelle gives away over $30,000 in taxpayer subsidies for every job created.

It's wonderful. We now have 3 luxury housing projects in downtown. I can't wait until the Monroe dorms, er, I mean the one bedroom and studio's are built on Echo Bay. Imagine owning a unit in the Trump building now? Units that sold for 850,000 are now listed for 300,000 and no buyers. It's a good thing the building was a failure to begin with or there'd be an 80% foreclosure rate. How can a city relocate housing project tenants into a luxury high rise and not expect the value to plummet?

I lived in Avalon 2 for a year. When I first signed my lease I was told no college students would be allowed to dorm in the building. By the end of the year I was paying full price for my studio while Monroe college students dormed in a $3500 3 bedroom luxury apartment all payed for by the taxpayer.

I asked them they said financial aid covered everything. Obviously they didn't give a crap about the place or appreciate how lucky they were and the situation was the same throughout the building, trash, broken beer bottles and drug paraphernalia in the stairwells. Laundry room was absolutely filthy and disgusting, amenities on the top of the roc always trashed or not working.

I eventually left because these college students were harassing me and Avalon was raising my rent 10 % to live in a big Dorm. This was besides the section 8 housing that they denied when asked by regular residents but everyone knew they were accepting it. its luxury for a project building or a college dorm but it sure as hell isn't luxury living by normal standards.

Every horror story you have heard is true and more. I wouldn't be surprised if Monroe and section 8 make up 50 % of the occupancy rate. These buildings were supposed to attract yuppies from NYC who would be commuters, for the most part that never happened.

you are 100 % right when you say that echo bay will turn into more dorm space for Monroe, no one will want to live next to a sewage plant away from any meaningful downtown, but it is right in the Monroe area so you can bet forest city will go to them to make back their money. That is exactly what Avalon did, got the land for nothing, got a 30 year tax break, and when things didn't go well they got more tax payer funded gov subsidies in the form of section 8, and college financial aid. they made out like bandits and we got left holding the bag. this is how Corporate Socialism works in Amerika these days.

Only college students will be willing to live near a sewage treatment plant because it wont be a long term situation. The average college student doesn't even have a lot of disposable income, so expect sales tax revenue to be negligible at best. You can bet all parties involved have already seen this outcome, the mayor and his cronies on city council just wont admit it.

This was suppose to flood the downtown with people who had disposal income so in turn, it would create the need for retail. This Avalon all falls into Bramson's GreeNR plan in which he is pushing this transit-oriented development thing. He wants to bring more high-end residential units to NR at taxpayer expense and continue to destroy the quality of life for east end NR residents. His plan has done nothing but added taxes and fees that the already broke taxpayers have to deal with. This man is destroying NR and he will do the same for the County. Mark my words.

All Bramson's plans were supposed to work. Shouldn't we judge him on that? How could it all go wrong? His Harvard professors all told him it would work. With his extensive background in business, why are the people not cooperating?

Is it possible that New Rochelle residents and taxpayers can rely on at least four (4) members of City Council to learn from the historical mistakes of Avalon 1 & 2 and scuttle the ill conceived Echo Bay project?

The only difference between EB and the Avalons is that the Avalon developments did not saddle the taxpayers with $25,000,000 in bond debt!