Urstadt Biddle Confirms Sales Deal for Westchester Pavilion

John Jordan | April 2015

 Screen Shot 2015-07-31 at 9.29.10 PMWHITE PLAINS—Urstadt Biddle Properties Inc. of Greenwich, CT, the owner of the Westchester Pavilion shopping center here, has confirmed that it has signed a contract to sell the property to a subsidiary of homebuilder Lennar Corp. of Miami.

The deal, first reported in the March edition of Real Estate In-Depth, will facilitate the redevelopment of the mostly vacant retail property that currently serves as the headquarters of the Hudson Gateway Association of Realtors, Inc. and Hudson Gateway Multiple Listing Service, Inc. into a $275-million mixed-use project that will feature residential and retail space.

On April 6, Urstadt Biddle issued a press release announcing it had entered into a contract to sell the 190,000-square-foot Westchester Pavilion to Maple and Broadway Holdings, LLC, a wholly-owned subsidiary of Lennar Corporation through its Lennar Multi-Family Communities, LLC subsidiary. Urstadt Biddle has owned the property since 2002 and in recent years the property has lost key tenants such as Border’s Books, Toys ‘R’ Us, and Sports Authority. Its remaining tenants include Outback Steakhouse, McDonald’s, HGAR and a few other small space users. No financial terms of the transaction were released, including a sales price.

In November 2014, the City of White Plains approved a zone change of the property to allow the Pavilion’s  redevelopment as a mixed-use property containing residential apartments above ground level retail and restaurant uses. The contract contains several contingencies that need to be satisfied in order for the transaction to close, and there is the possibility it may not close. If all contingencies are satisfied, the company expects the transaction to close at the end of fiscal 2015 (Oct. 31, 2015) or early fiscal 2016, the company stated.

White Plains Mayor Thomas Roach told Real Estate In-Depth that the city met earlier this month with officials from Lennar and Urstadt Biddle Properties and expects Lennar to eventually file an application for site plan approval for their proposed project.

The deal between Urstadt Biddle and Lennar was revealed in paperwork filed last month with the Westchester County Industrial Development Agency. Lennar was on the agenda to present its plan to the IDA Board on March 12, but at the 11th hour pulled its plan from consideration. IDA officials have told Real Estate In-Depth that they expect Lennar to come before the Board in the near future in connection with incentives the developer is seeking for its redevelopment project. The IDA’s next meeting is scheduled for April 23.

It was unclear from the IDA documents whether the sales deal would have Urstadt Biddle remain involved in some facet of the development when construction is completed. In its April 6th press announcement, Urstadt President and CEO Willing L. Biddle closed the door on such an arrangement.

The plan as reported in the IDA application “will be a mixed-use facility, comprised of retail on the ground floor and multifamily dwellings above, together with associated parking and amenities. There will be approximately 95,600 square feet of retail and 756,300 square feet of multifamily dwelling space.”

“During the approval process we met with several prestigious development companies to consider as partners in the development—the plan being that UBP would own the retail/restaurant portion and our partner would own the residential portion. As time went by it became more apparent that a better structure for our company was an out-right sale of the property to a more experienced mixed-use developer and that developer was Lennar,” Biddle said.

“We will continue to work closely with Lennar through the remainder of the approval process, which includes, among other things, site plan approval,” he continued. “The company is in the process of resolving the remaining contingencies to permit a closing.”

Biddle and a representative for Lennar had no comment on the pending sales deal when contacted by Real Estate In-Depth.

Mayor Roach said the city has met with key officials of Lennar and Urstadt Biddle about the sales deal and the redevelopment plan. As of yet, he said Lennar has not filed a site plan application with the city.

He said the talks have been “cordial” and he believes the plan will move forward. “They are looking for 650 to 700 (residential) units with retail and significant improvements in the pedestrian streetscape, which is what I was looking for outside, especially on Maple (Avenue) where it really needs it,” Mayor Roach said.

The proposed retail would be located at street-level on Broadway, which would help bring more traffic to other retailers in the area, Mayor Roach added.

While the mayor was reluctant to provide a time frame as to when the project might come before the city for site plan approval, “I would say that they mean business,” he said.

Included in Lennar’s IDA application was a project timeline that included acquisition of the land by June 2015, a projected issuance of a building permit by April 2016, commencement of construction in May 2016 and occupancy by May 2019. Lennar is seeking approximately $11.7 million in sales tax exemptions and about $2.76 million in mortgage tax exemptions from the IDA. The project is expected to create 2,895 construction jobs during the three-year construction phase.

Urstadt Biddle Properties secured a zone change from the City of White Plains in November 2014 that will allow as much as 860,000 square feet of mixed-use space to be developed at the site.

Lennar in its application to the Westchester County IDA stated that the new development would entail a total of 851,900 square feet. The company, while describing the development as a “high-rise,” did not disclose the proposed height of the building or whether it would involve multiple buildings.

The plan as reported in the IDA application “will be a mixed-use facility, comprised of retail on the ground floor and multifamily dwellings above, together with associated parking and amenities. There will be approximately 95,600 square feet of retail and 756,300 square feet of multifamily dwelling space.”

Lennar is proposing to develop what it terms as “the equivalent of a LEED Star building” that would include a variety of green technologies.

HGAR in Talks To Relocate Operations

The Hudson Gateway Association of Realtors is in discussions with Westchester Pavilion owner Urstadt Biddle Properties about relocating operations from the property to another downtown building. HGAR CEO Richard Haggerty would only confirm that negotiations are ongoing, but said that since a deal has not been finalized he would not provide any further information, including the proposed property under consideration.

In the Boardroom Report on page 22 in this edition of Real Estate In-Depth it is reported that at its meeting on March 4th, CEO Haggerty provided an extensive presentation regarding the proposed permanent relocation of the White Plains offices of HGAR and the Hudson Gateway Multiple Listing Service, Inc. from 60 South Broadway to a new site in downtown White Plains. The presentation included a virtual tour of a proposed layout and office design for the new location. CEO Haggerty reported that Urstadt Biddle Properties had executed a letter of intent to lease the proposed space and would now commence to negotiate a final lease agreement. “Provided that UBP is successful in negotiating a lease, a new Lease Amendment would provide for a building substitution. All other terms of the current Lease Agreement would remain in full force and effect,” HGAR stated in its Boardroom Report section in Real Estate In-Depth.

The report also noted that UBP has agreed to pay for all expenses relating to the build-out including new furniture, the physical move, letterhead, decorating and painting, etc. In addition, the current Lease Amendment provides that UBP will pay for any unforeseen costs. Editor’s Note: For further details on the presentation, see Boardroom Report on page 22.

The Westchester County Board of Realtors moved its operations across the street from 40 South Broadway to the top floor of the Westchester Pavilion on Aug. 1, 2008. The offices have served as the headquarters for the association and MLS since that time.

John Jordan
Editor, Real Estate In-Depth