Taubman Centers Inc. (Bloomfield Hills, Mich.) announced that it is seeking a final decision from the Supreme Court of the State of New York (Suffolk County) on its long-delayed, long-contested land use plan for the former Cerro Wire factory site in Syosset, N.Y. for an 860,000-square-foot Mall at Oyster Bay.
Taubman has been seeking for five years the right to build the mall in Long Island’s eastern-most county, anchored by Neiman Marcus, Nordstrom and, now, Barneys New York. The effort has been fought by the town of Oyster Bay, N.Y., and by community activists, who have opposed the mall on a number of bases, including the size of the development and resultant traffic issues.
“Oyster Bay town supervisor John Venditto has often said the courts should not be the final arbiter of town zoning decisions and we would traditionally concur,” said Steve Kieras, Taubman's senior vp, development. “However, given our unsuccessful attempts to date to reach a settlement with the town, we are left with no choice but to re-enter the court house for the purpose of enforcing our right to build based on previous judicial decisions and our strategic commitment to serve the Long Island market.”
The Taubman proposal will create an economic transformation of the former wire manufacturing complex, building a retail center on the site that will include more than 100 inline stores. The developer said construction of the mall is expected to generate 3000 to 3500 jobs in the building trades while pumping nearly a half billion dollars into the county's economy. After construction, the mall is expected to generate annual salaries of nearly $51 million and nearly $8.6 million in annual real estate tax revenues for the town and county. The Syosset school district alone is anticipated to receive nearly $4.7 million annually.
Kieras said that Taubman would be willing to resume discussions with the town regarding the possibility of modifying the size of the mall while the case in court proceeds; however, in light of prior court rulings, he said he believes the court will allow the company to build the larger size mall as originally proposed.
Taubman said it is “firmly committed to building a mall on this property,” according to vp and cfo Lisa Payne. “Sixty-five percent of the tenant space in the mall is committed, over 50 percent has fully-executed leases and the mall will be anchored by three of the world's greatest retailers: Neiman Marcus, Nordstrom and Barneys New York. Depending on the timing of the construction and opening of the mall, we anticipate spending as much as $500 million on this project. Assuming $500 million of cost we expect a minimum return of seven percent, resulting in an asset that will create significant value for our shareholders.”
Taubman originally applied in 2000 to the Oyster Bay town board for a special use permit and site plan approval for a 960,000-square-foot mall. A public hearing led to a petition and the size of the proposed mall was reduced to 860,000 square feet. But numerous residents continued to object and Taubman offered to reduce the size of the proposed mall again, to 750,000 square feet. In 2001, the town board denied Taubman’s application for a special use permit though, in 2004, it granted Taubman a demolition permit to demolish all structures on the 39-acre property.