IDA approves $46M in tax and other benefits

Proposed office tower for 125th St. Image: Swanke Hayden Connell Architects.

Major League Baseball project in Harlem is among the beneficiaries. On March 6, 2008, the New York City Industrial Development Agency held a public hearing on proposed public subsidies to private entities, including a joint venture between Vornado Realty Trust and California Urban Investment Partners. The joint venture was established to build a 21-story office tower on 125th Street and Park Avenue, directly southwest of the Metro-North train station. The tower will contain 526,555 sq.ft. of office space, 50,492 sq.ft. of retail, and a 52-space underground garage. The tower’s anchor tenant will be MLB Network, Major League Baseball’s new cable broadcasting system. The work site lies within the proposed 125th Street rezoning plan, which the Planning Commission approved on March 10, 2008 to encourage renewed investment and development in the area.

At the hearing, Bettina Damiani, Director of Good Jobs New York, questioned the need for subsidies to attract MLB to Harlem given the area’s easy access to Yankee Stadium and Citi Field via public transportation. Charles Callaway, representing WE ACT for Environmental Justice, expressed similar skepticism and feared that the newly created jobs would not go to community residents.

IDA disagreed, and on March 11th voted to award the joint venture 16 million dollars in public assistance, including a mortgage recording tax waiver and City and State sales and use tax exemptions. IDA also awarded five million dollars in City and State sales tax exemptions to MLB Network for the occupancy, tenant improvement, and equipping of 132,000 sq.ft. of office and television studio space within the tower. IDA estimates that the overall project will create or retain 3,170 jobs and help establish Harlem as a cost-effective alternative to other business districts in the City.

Other IDA awards approved on March 11th include Remains Lighting, which received $4.8 million in triple tax-exempt bonds, $134,960 in mortgage recording tax benefits, and $77,929 in sales tax exemptions to acquire, renovate, and equip an 18,500-square-foot warehouse in Bushwick, Brooklyn. IDA estimates that the project will create 55 jobs.

IDA awarded Artex Inc., a fine art company, $14.5 million in industrial incentives, along with $420,000 in mortgage recording tax benefits and $104,688 in sales tax exemptions. According to IDA, Artex is seeking to acquire and renovate a 75,000-square-foot facility in Long Island City, Queens, to consolidate its operations. IDA says the project will create and retain 47 jobs.

Lastly, Tri-State Biodiesel LLC, which manufactures biodiesel fuel from restaurant oil waste, will receive $4.4 million in triple tax-exempt manufacturing facilities bonds, as well as $123,200 in mortgage recording tax benefits and $155,492 in sales tax exemptions. Tri-State plans to construct and equip a 17,250- square-foot facility in Brooklyn, giving the company an annual production capacity of three million gallons. According to IDA, the project will create 23 jobs while retaining 17 jobs.

IDA: Bd. of Directors Meeting Press Release (Mar. 11, 2008); Project Cost/Benefit Analysis (CV Harlem Park, LLC) (Mar. 6, 2008); Notice of Public Hearing (Jan. 23, 2008).

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