Take me out to the mall game! (Queens Development Group)

Talk about a home run.

After two years of negotiations with some of New York’s biggest developers, the city has scored a victory at Willets Point at once smaller and bigger than previously pitched. Today, Mayor Michael Bloomberg released the line-up for a 52-acre Willets Point development boxing in Citi Field, which will be built by a development double play by the Related Companies and Sterling Equities, run by the owners of the Mets.

The project will not encompass the entire 61-acre Iron Triangle. Nor will it follow the outlines of a plan for phased development at Willets Point released in 2010. But rather than being a smaller project, a glorified mall as early leaks of the agreement had suggested, the new plan far exceeds what the Bloomberg administration had once called for on the site two years ago—and not simply because the Wilpons will now build a million-square-foot "entertainment complex" (don't call it a mall!) on the west side of their stadium. The bigger play is what is planned on the east side of the stadium.

“At Willets Point, where others have seen challenges, we have always seen enormous opportunities,” Mayor Bloomberg said at a breakfast hosted by the Queens Chamber of Commerce. “Today the valley of ashes is well on its way to becoming the site of historic private investment, major job creation and unprecedented environmental remediation."

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Previously, the city was looking to develop 680,000 square feet of retail, 400 units of housing and up to 387 hotel rooms on a 12.5 acre site. Now, with the expansion of the project west of the stadium—a 29 acre parcel to be known as Willets West—there is more room for housing and hotel rooms, and even some office space within a 23 acre swath of the Iron Traingle. The amount of retail also rises to 900,000 square feet, though it is meant to be community focused, rather than the destination, mall-style retail that will be in Willets West.

The number of housing units jumps to as many as 2,500 apartments, up from 400, of which 30 percent would have to be set aside as affordable housing. At full build out, that would be 875 units. Related has the option to build less apartments overall depending on market conditions, but spokeswoman Joanna Rose said the plans was to build as much as possible. "You have to build a critical mass to create a neighborhood," she said. And it is true that residential is a specialty of Related's, as well as one of the more profitable things one can build in the city.

There will also be up to 500,000 square feet of office space, which is targeted at local businesses, and two hotels, one of 200 rooms and another of 280, a hundred more than previously planned for the site. There will also be more open space than originally proposed, 5 acres instead of 2 acres.

Taken together, the 52-acre complex (not counting the stadium sitting in the middle of it) covers twice the area of Related's Hudson Yards development, but is also smaller in scale, 6 million square feet compared to nearly four times as much development on the Far West Side.

Were Related and Sterling to win later phases to develop the entire Willets Point area, it would control a huge 90 acre swath of prime Queens real estate. The development team has the right of first refusal on subsequent phases of the project.

Issues of eminent domain for the project are still looming, but also shrinking. Mayor Bloomberg announced that the city now controls 95 percent of the property within Willets Point needed to move forward on the first phase and hoped to own all of it soon, thereby avoiding eminent domain proceedings for the first phase. The city controls less land further east in Willets Point.

"The mayor is keeping his eye on Queens," Congressman Joseph Crowley said. "The jobs here will be enormous." Construction is expected to employ 12,000 workers over the course of the project and create 7,100 full-time jobs within the project area.

None of this can begin before the developers clean up their site, a process that is expected to begin next year or early 2014 and could last a few years given the mess at Willets Point—decades of contamination dating back to the valley of ashes, when it was a coal dump, as well as more modern toxins from oil to heavy metals from the auto and industrial work in the area.

The developers have promised a state-of-the-art, sustainable clean-up, but that also means it will be a few baseball seasons before anything can be built, let alone open. The city will contribute $100 million toward clean-up and infrastructure work, which will be repaid through $310 million in construction tax revenue and $150 million in annual taxes, according to the administration's calculations.

Once the site is cleaned up, it will proceed in phases, with the 200-room hotel and 30,000 square feet of retail and restaurants along 126th Street, on Citi Field's eastern flank. This part of the project will be designed by Elkus Manfredi and Perkins Eastman, with another possible collaboration on the hotel.

This first piece of development is meant to activate the entry to the stadium while also masking a 20-acre parking lot that will be paved behind it. This will facilitate the construction of Willets West because the plan is for the new million-square-foot complex to be built on the stadium's current parking lots.

The new lot will be fitted with temporary ball fields and community space that will be available half the year, during the Met's off-season and when the team is away on prolonged road trips. The developers are exploring whether this would be fields that could be driven on top of or temporary structures that need repeated installation, as happens at all-star games, the Super Bowl and similar events.

To accommodate this new lot and other modifications, the city will be seeking approvals from the City Council but is structuring the plan so as to avoid a full land-use review going through the community boards and borough hall.

Once Willets West is built, including a 2,500 car parking structure, the eastern parking lot would be replaced with the balance of the 4.5 million square feet of development—all that housing, retail and office space.

"This is a great asset for the team and for Queens," Jeff Wilpon, executive vice-president for Sterling Equities said.

Sterling and Related were both looking at the project, while it was the Wilpons that suggested the two should team up. That franchise is giving fans of the long-planned (at least as far back as the Mets' last World Series) project hope it will finally happen.

"I think this is just spectacular," Queens Borough President Helen Marshall said. "And with the Mets on board, I know it's really going to get done. They're fielding the best team, very focused on results."

Disconcertingly disconnected. Click to zoom in for a better view. (Bing Maps)

A reader sends along this thoughtful critique of the problems inherent in the latest plans for Willets Point:

What a horrible idea. A parking lot and a mall? That neighborhood is a mess already, though. Just a few hundred feet from the bay in one direction and Flushing Meadows in the other, and they're both nearly impossible to access. It should be a wonderful spot to hang out before a ballgame, and instead it's just a tangle of highways. Thank you, Robert Moses.

It's a very interesting point, and perhaps points to a better way forward for this forlorn corner of the city.

After all, just look at this picture. A giant parking lot on one side, a giant (though very vibrant) pit on the other. All of it surrounded by a mess of highways, just beyond, lush lawns and open water. Indeed, this was the fine work of Robert Moses, master of the World('s Fair), so it makes sense that roads are bisecting and bifurcating everything, keeping the various masses, washed and unwashed, from crossing paths.

But this has been less the prerogative of this mayor, thankfully, which is why the decision to go all cars-n-malls—yes, even in Queens—makes so little sense. This is still a dense area, one well-served by mass-transit, one begging for improvement. The proposal for two huge malls actually makes the original plan conceived by the mayor five years ago, to build an actual neighborhood here, look even more impressive than it already did. Something new, with plenty of jobs and affordable housing, maybe even a convention center.

Now, instead, Queens is getting more suburban development, when it deserves better. As our reader points out, wouldn't it be nice to extend the park all the way up, doubling it in size? Here is a place where capping some railyards would make sense—push the development to the edges, and open up the rest. Madison Square Garden has no parking, and it gets along fine.

There is the added advantage that the expense of remediation and infrastructure to build up Willets Point to where it needs to be—it's seven feet below the flood plane in some places—would be considerably cheaper were it to be turned into a park rather than streets and homes and shopping malls. Instead, we sell it off to the highest bidder, and do their bidding at that, so that the development might commence cost-free. We already know that is how the administration likes to do business.

Which is not all bad. Times are tough, money is tight, would anything really happen without some private help? Probably not. No plans have yet been unveiled, so it remains to early to judge, but for the city's sake, whatever gets built here, may it be as innovative and ambitious as what came before.

mchaban [at] observer.com | @MC_NYC

An 800,000 square-foot mall will be built on the Citi Field parking lot (right), followed by a 680,000 square-foot mall on the edge of Willets Point (left). Because who doesn't want to go shopping after the Mets lose? (Bing Maps)

The original plan, going nowhere fast. (NYC EDC)

It may be a strike for the mayor, but Steve Ross and Fred Wilpon have scored big time with the latest Willets Point do-over.

It was revealed earlier this month that after a year of weighing competing proposals, the city had selected the Related Companies and Sterling Equities to redevelop the Iron Triangle, albeit in vastly revised form. Housing and other development would be put off in favor of a large mall.

Make that two malls, surrounding the new-ish throwback stadium, a veritable retail double play.

According to both The Times and The Journal, before much gets built in Willets Point, the 62-acre swath of chop shops and heavy industries just east of Citi Field, a mall will be built on the west side, on the site of the current Mets parking lots. Per The Journal:

The first step for the developers would be to take on a costly 20-acre environmental cleanup and build the new parking lots for the stadium [on the Willets Point side to the east], the people said. They would also be required to build a hotel and a small amount of retail just to the east of Citi Field.

Then they would be able to build more than 800,000 square feet of retail on the parking lots to the west of the stadium. Only then would construction begin of the new neighborhood first envisioned by the Bloomberg administration, with the construction of the 400 apartments and 680,000 square feet of retail. That aspect of the project could grow, the people said.

The Times said the cleanup could cost more than $40 million, but also notes that the added development is seen as a positive, not a negative, to the plan.

According to the executives, Related Companies joined forces with Sterling Equities to come up with a new proposal that embraced Citi Field. Proponents argue that the city will get what it had always planned at Willets Point, but the timeline and sequencing will be different.

How long it will take for any of this to ever be built is an open question, though there is said to be a $35 million penalty if no housing is completed by 2025. How much housing, beyond the initial 400 units planned, remains to be seen. All four developers reportedly argued that the project, with 5,500 units, a third of which were meant to be affordable, is too complex to complete as originally planned.

That took a grueling City Council review, another of which will be due for parts of this project. Which also raises the specter of the Kingsbridge Armory, where retail unions successfully defeated the Related Companies bid, with the help of local pols. Could that be a problem here, too?

The developers had better be wearing their lucky jock straps to pull this one off.

mchaban [at] observer.com | @MC_NYC

From muck to mall. (Getty)

Willets Point has long been one of the most neglected corners of the city, famously appearing in The Great Gatsby as "the valley of ashes." The Bloomberg administration has been working for years to redevelop the 62-acre Iron Triangle, long home to auto body shops and a handful of heavy industries nestled between the Mets stadia and downtown Flushing.

Today, City Hall took a step toward spiffing up the site, if not quite in the direction it had hoped.

The administration withdrew its eminent domain case, known as a determination of findings, from state appellate court, halting takeover proceedings against a handful of holdout property owners in the area. This paves the way for the project to move forward, albeit in an altered form from the 2008 rezoning, which called for a mixed-use development on the site.

According to people familiar with the situation, the city is close to reaching a deal with the Related Companies and Sterling Equities to build a mall on the site. The exact details are still being worked out, and an official announcement is expected in the coming weeks.

It was not immediately clear if there would still be a residential or convention center component in the final plan, but City Hall is still looking favorably on the latest developments for the development.

“We’re very close to having a deal in place that will transform Willets Point into New York City’s next great neighborhood and continue the historic progress we’ve already made there," Bloomberg spokeswoman Julie Wood said in a statement. "Today’s action ensures that our plan will comply with the site’s myriad technical and legal requirements.”

Ms. Wood declined to discuss whether or not Related had won the bid, and Related declined to comment. Sterling Equities, which is run by Mets owners Fred Wilpon and Saul Katz, did not return a request for comment. Still, finally a win for those two. As for Related, is there a city-controlled project they cannot win?

Previously, the city had planned for a developer to build 5,500 units of housing, about a third of which would be affordable, more than a million square feet of retail, and a hotel that was to have served, among other things, a new mid-size convention center. That part of the plan had been called into question now that Governor Andrew Cuomo wants to build a massive convention and casino complex at Aqueduct.

The project had been broken up into three phases, a result both of the recession, which left developers leery to take on the project, but also the fact that there were still dozens of properties within the 62-acre site that the city did not yet own. Splitting the project into phases meant at least part of the redevelopment could proceed, arguably the most important part, the 20 acres closest to neighboring Citi Field. For the first phase, 680,000 square feet of retail and 400 units of housing were planned.

Another reason the initial plan was abandoned was that all the developers interested in the project—other contenders were Silverstein Properties, TDC, and Avalon Bay—were unsure of the ability to execute even such a modest proposal for one of the most complex sites in the city.

Part of the reason Willets Point became the Iron Triangle is the land is essentially a bog, lying a good six feet below the rest of the area. It would require significant excavation and landfill to bring it up to grade. Further complicating matters, centuries of industrial activity—remember the valley of ashes?—has left the ground heavily polluted. Any development would require significant remediation of the site before it could move forward.

These vexing issues caused all four of Willets Point finalists to propose plans outside the parameters of the phase 1 request for proposals. It appears the city took the proposal it found to be most acceptable and is proceeding with that.

It is not clear whether this would require a new rezoning, but if Related were to build within the 680,000 square feet of retail allowed by the plan, it could probably be built as of right. (It is worth noting that that is the size of another of Related's malls, the Gateway Center in East New York, best known for being the purported site of a proposed Walmart. Perhaps the big box retailer could come to Queens, instead?)

Another factor beyond the toxicity of the site is, or rather was, the pending eminent domain case, which was to have been heard on Monday. "There were a lot of things going against the city here, and in view of all that, I think someone made the executive decision that this was going against the city and would set a bad precedent for all future takings," Michael Rikon told The Observer.

Mr. Rikon, an attorney for Willets Point United, a landowner group fighting the city, said that the city faced a tough case because of issues ranging from a failure to have translators at the eminent domain hearing (many property owners are Latino) to not providing notice in person and having no clear public use yet assigned (there was not yet a developer in place at the time of the hearing). "It's strange, too, because rarely do you win these kinds of cases," Mr. Rikon said of eminent domain defendants, "but I really thing this could have been different."

His clients, he said, "are pretty ecstatic." That said, their future remains uncertain as the city owns much of the land in Willets Point now, and whether it wants to remain a landlord to chop shops seems unlikely. "We wish we knew what the city would do with those leases, because they're commercial leases and the city is under no obligation to renew them," Mr. Rikon said. "Really, how interested is the city in rental income? Not very."

Mr. Rikon also said there was no reason the city could not simply hold another eminent domain hearing in the future, correcting any apparent errors, and take the property all over again. He was hopeful that might never happen. "The remediation alone will cost billions of dollars, so is it really worth it?" he said.

As for a name for this new mall (just what Queens needs!), The Observer has the following suggestion: Call it The Metropolis.

mchaban [at] observer.com | @MC_NYC

A handful of developers are competing to redevelop the so-called "Iron Triangle." (The NYC Economic Development Corporation)

While some people are hoping—futilely, perhaps—for a high-tech college at Willets Point, the official R.F.P. is also cranking along, with application filed this past week. Crain’s now has word of a handful of the developers competing to redevelop the Iron Triangle, and one looks to be a hit, if it weren’t already facing a few strikes.

The Related Companies has teamed up with Sterling Equities, which is controlled by Mets owners Fred Wilpon and Saul Katz, to submit a proposal to redevelop the 12.75 acres included in the project’s first phase, the sources said. Silverstein Properties, which is building three towers at the World Trade Center site, also threw its hat into the ring. None of the firms would comment. A source said Sterling had teamed up on bids with more than one firm.

Another firm known to have submitted a bid is the Flushing-based TDC Development. Of the 29 firms that were preapproved, Crain’s reports, Westfield Group, the Richman Group of New York, Edward J. Minskoff Equities and Hamlin Ventures did not submit bids, though it was not clear how many others had.

This is only the first of three phases, which includes housing and retail but not a planned convention center. Given CitiField’s proximity across the street, it makes sense the Wilpons would want in on the project, and they made the smart move of teaming up with Related, which seems to often win favor with city officials. Whether the Mets owners’ current imbroglio with the Bernie Madoff scandal will hurt the development team’s chances remains to be seen.