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Low-income housing and a new Bronx hotel may soon rise from the ruins of the Yankee Stadium garage debacle, according to the New York Daily News.
That's because the Yanks' quick exit from postseason has made the outlook even grimmer for Bronx Parking Development LLC, the nearly bankrupt company that owns the 9,000-space garage system.
For the second season in a row, those garages have averaged less than 50% occupancy on game days. Even though Bronx Parking sharply increased prices this year, its garage revenues were so anemic it was forced to withdraw $2.3 million from its dwindling reserves just to meet an Oct. 1 debt service payment, records show.
Another debt service payment of $6.9 million is due in April.
"Things are getting worse each day, and we have no more money coming in until baseball season starts," said one member of the company's board. "We have to do something fast."
Here's the reality: The city's Economic Development Corp., which authorized $237 million in public bonds for the garages back in 2006, is staring at one of the biggest defaults of a New York City bond in decades.
To avoid default, EDC officials have been quietly cobbling together a deal for two of the system's parking lots to be used for affordable housing and retail development.
Under the proposal, recently approved by the parking company's board, Jackson Development and Joy Construction would build 550 units of affordable housing and 45,000 square feet of retail on lots near the existing Gateway Shopping Mall.
The developers would then make annual lease payments to Bronx Parking and, if all approvals go smoothly, groundbreaking could begin by 2013.
"This alternative use will generate additional revenue to pay the debt service on the garage bonds," EDC spokesman David Lombino said.
Even those payments will not be enough to make the garages financially viable, said one official who has reviewed the numbers.
That's why Bronx Borough President Ruben Diaz is urging a second solution. Diaz wants one of the garages torn down and replaced with a new 200-room hotel that would generate permanent jobs for the Bronx.
Diaz aides say several major hotel operators have expressed interest informally, and the borough president's economic development agency has set a November deadline for formal proposals.
After allowing the NY Yankees to seize 25.3 acres of public parkland without requiring that it all be replaced, the city under the Bronx Overall Economic Development Corporation (BOEDC) - last month announced it was seeking proposals to develop a hotel and conference center on the site of one of Yankee Stadium's parking garages (Garage 8 - above). A clause at the end of Diaz' call for developers notes that the city's agreement with the team requires it to replace any eliminated parking spaces from the team.
Any hotel proposal will undoubtedly need additional subsidies from taxpayers.
Unfortunately, the Bloomberg administration, as part of its original deal with the Yankees for a new stadium in the Bronx, gave in to the team's ridiculous demand for 9,000 parking spaces.
As a result, a costly garage system, one that was poorly conceived to begin with, is on the verge of financial collapse.
Let's hope they get it right this time.
Read More:Skeptics, though, question the sustainability of such a project some distance away from Manhattan.
“What the proposal tells me is that someone’s got a parking garage that isn’t making money, they’re desperately looking to bail it out, and they’re looking for an economic development angle that will make the thing look like a grand success,” said Heywood Sanders, a public administration professor at the University of Texas at San Antonio.
“There is no market analysis here,” Sanders, an author and frequent critic of publicly financed convention centers, said in a phone interview. “It’s like they’re saying, 'Please, developers, tell us if you might be interested.’ ” - The Bond Buyer - September 26, 2011
Condos, shops and a high-end penthouse restaurant are all part of the plan.
The Bronx Overall Economic Development Corp. on Monday invited developers for proposals.
The site to be developed is at River Avenue and 153rd Street, bordering the park where old Yankee Stadium stood.
Borough President Ruben Diaz Jr. said developers and hotel operators have expressed interest in such a hotel for years.
Chuck Lesnick, vice president of the agency that manages the stadium garages, said he hoped visiting baseball teams as well as tourists would be attracted to the hotel.