City Extends Lester’s Lease, But Hires Broker to Sell 1037; Meanwhile, a Potential Buyer in the Wings?

The saga of 1037 Boston Post Road, the building behind City Hall that the City purchased in 2006 for $6.2 million, continues.

Published October 4, 2012 5:00 AM
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The saga of 1037 Boston Post Road, the building behind City Hall that the City purchased in 2006 for $6.2 million, continues.


By Robin Jovanovich

 

The saga of 1037 Boston Post Road, the building behind City Hall that the City purchased in 2006 for $6.2 million, continues.

 

Lester’s, the current tenant, pays $24,300 a month in rent. The clothing store’s owners have made the City an offer of $3.6 million to purchase the building.

 

After much heated discussion over several meetings, the City Council, September 12, authorized City Manager Scott Pickup to do two things: extend Lester’s lease, which was set to end in March, until the end of 2013; and enter into an agreement with commercial broker CBRE to market the property.

 

Councilman Joe Sack was opposed to extending the lease, stating, “CBRE suggested it would be best if the property were ‘unencumbered’”. He also remarked worriedly that, “Lester’s might walk away from the lease!” (The City has a two-month deposit from Lester’s, noted Corporation Counsel Kristin Wilson.)

 

“The City currently has a $200,000 budget hole for 2013,” Mayor Doug French advised. “Lester’s has been a good tenant. It’s in our best interests to extend the lease.”

 

Councilwoman Catherine Parker expressed her opposition to “having the city manager act as the point person on the agreement.”

 

“We need to act,” emphasized Councilman Peter Jovanovich.

 

Councilwoman Parker responded, “I’m beginning to see this as cyclical.”

 

“I agree. Let’s act!” repeated Councilman Jovanovich.

 

Mayor French added that he didn’t want to have real estate discussions during the upcoming budget process for 2013.

 

Lester’s is “anxious” to extend their lease, noted the city manager.

 

“We’ve looked at all the issues. That window is closing,” stressed Mayor French. “The broker has said a lease extension will not affect the sale. I’d rather lock in the lease extension.” He added that it was easier to market a leased building than an empty one.

 

Councilwoman Parker reiterated her view about not wanting the city manager to handle the matter. “It’s outside of his scope.”

 

“I’m tired of being held over a barrel,” complained Councilman Sack.

 

Ted Carroll, a regular and vocal attendant at Council meetings, came to the dais. His comment: “This Council is suffering from Executive Session [referring to the private period before the public meetings] sickness. The national marketing of a building takes months.”

 

Before the matter came to a vote, another plot line developed. Longtime Rye resident Bernard Goldstein, who owns commercial buildings in Queens, expressed his interest in buying 1037.

 

The Council voted 5-2 to extend the lease with Lester’s (Councilmembers Sack and Parker voted against); and 6-1 (Sack the lone ‘no’ vote) to enter into an agreement with CRBE. So far, no one from Lester’s management has commented on the back and forth on a deal.



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