Rotterdam, Via Port reach $244K deal on quashed mall lease agreement

ROTTERDAM – The town is on the verge of recouping the $1 million security deposit down payment from a controversial long-term lease agreement with Via Port Rotterdam mall that the newly elected supervisor slammed as misguided and broke off when she took office in January.

Under the terms of the proposed settlement, Rotterdam will pay the negotiated settlement of $243,750 to the owners of the mall after the municipality receives a wire transfer of the full down payment.

That figure, according to the agreement “constitutes a fraction of the total base rent and additional rent that would have been due during the entire 10-year term…”

The Town Board is expected to take action on the resolution at its meeting Wednesday.

The proposed agreement also bars both sides from taking any legal action.

Attorney Andy Brick, who is representing Florida-based Via Port New York LLC, said Monday that “it’s a very fair solution to everybody.”

“Basically, the town has agreed to pay a reduced rent payment for the time that they had the property under lease, and in exchange Via Port has agreed to release the town and past town officials from any liability,” said Brick. “The town has been very professional throughout this process. Via Port has a great relationship with Rotterdam and they’re very excited about the future.”

But that professional working relationship seemed to take a hit earlier this year when the administration of new GOP Supervisor Mollie Collins scrapped the 10-year lease deal to move municipal, police and court operations all under the same roof into the vacant Kmart store at Via Port mall on West Campbell Road.

Over the life of that deal, the town would have paid out about $4.7 million, said officials and attorneys.

Collins did not return calls Monday seeking comment.

Town Hall is located on Sunrise Boulevard, the police department on Princetown Road. Both multi-story buildings are old and outmoded.

The move to the roughly 52,000-square-foot space that once housed Kmart was touted by supporters on the Town Board when the Democrats were in charge as a way to streamline municipal and police operations and generate revenue by selling the aging structures.

Collins, who was elected supervisor along with another Republican board member last November and took office in January, accused a faction on the former board, which was dominated by Democrats, of not providing her with updated numbers of the town’s financial commitment on the pact with mall owners.

The $1 million deposit to consummate the deal occurred Dec. 6, according to information on the town’s website detailing the latest agreement to break it off.

“The board has been advised concerning the various risks, strengths, and weaknesses of both parties’ cases and the town’s potential exposure,” states the agreements under the heading evaluation and analysis. It goes on to say that “authorizing this settlement would eliminate uncertainty, promptly resolve the dispute, would result in a savings of potential attorney’s fees and would result in a payment of a mere fraction of what would otherwise be due during the full term lease. ”

The town earlier this year paid for an engineering firm to conduct a cost analysis and evaluation.

That analysis concluded, in part, that it would cost Rotterdam $9 million to fix the police and court facilities and $5.4 million to renovate Town Hall for a total of $14.4 million versus around $9.2 million to lease or buy space at Via Port.

That latter figure was projected at $5 million last year when the idea of ​​moving to the mall was made public.

Collins has attributed the several million-dollar increase to, in part, inflation — plus she contended that they weren’t transparent enough with the public, leading her to scrutinize the deal more closely.

On Monday, Councilman Evan Christou, who was on the board when the deal with Via Port was signed, reiterated that the previous administration under then-Supervisor Steve Tommasone acted in the best interest of town residents and did everything above board.

“At the end of the day, is it an expense to the community? Yes, it is, but again, nobody had any malicious intent here, and everybody from whatever administration was in charge at the time, were doing the best for the community ,” he said. “In my opinion, the way that the mall handled this shows that they are truly, not only invested in our community, but vested in our community, and that they are willing to be a part of this community, and hopefully move forward where everybody succeeds.”

The engineering firm‘s evaluation from over the summer also revealed some supposed inaccuracies in the lease agreement, notably that the lease deal did not include an option for the town to buy, but instead featured a right of first refusal clause.

In real estate, right of first refusal is a provision written into a lease or other agreement that gives a potentially interested party the right to buy a property before the seller negotiates any other offers.

The entire kerfuffle led to one resident gathering petitions against the move in an effort to push the idea to a public referendum.

Others seemed angry that if the move to the mall had been approved it would have relocated the police department from its current, more central location.

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