Going Coastal

NASCAR site back in limbo as deal dies

In Go Coastal, Staten Island on November 30, 2007 at 10:55 pm

Sale to warehouse giant fails, renewing worry over fate of 676 acres It was supposed to be International Speedway Corp.’s road out of Staten Island — a $100 million deal to sell 676 acres of vacant industrial land where the company had hoped to build an 82,500-seat NASCAR racetrack, before that plan proved politically unfeasible.Now ISC is expected to announce that its deal to sell the site to ProLogis, the world’s largest developer of distribution warehouses, has collapsed, after the sides failed to agree on the terms of a sale.

<!– if (parseFloat(navigator.appVersion) == 0) { document.write(”); } –>The news is bound to trigger another wave of uncertainty for both ISC and Staten Islanders over the future of the largest privately owned piece of undeveloped industrial land in the city.

ISC had expected the $100 million sale to close next month and give the company a boost, after it posted a 72 percent drop in third-quarter profits.

Through a spokesman yesterday, ISC declined to comment, but Denver-based ProLogis confirmed the news.

“We’ve elected not to proceed under the existing terms of the current agreement,” said ProLogis spokeswoman Jessica Neal.

Ms. Neal said that, as part of its purchase agreement, ProLogis had a short-term inspection period to conduct due diligence. That period had ended and the company elected not to proceed with the sale. She declined to say what concerns came up, but said ProLogis remains “interested” in the site.

TRACK REVIVAL UNLIKELY

Guy Molinari, a former Staten Island borough president and one-time lobbyist for ISC, said it’s unlikely the company will revive its $600 million racetrack plan.

“I doubt very much whether ISC would consider that site again, after what they’ve been through,” Molinari said yesterday. “I think they were very disappointed in the way things turned out. They are a big corporation and they are not used to the kind of reaction that they encountered here.”

The Island’s three city councilmen ultimately gave a resounding no to the racetrace.

The Council had life-or-death power over the proposal.

<!– if (parseFloat(navigator.appVersion) == 0) { document.write(”); } –>State Sen. Andrew Lanza was more hopeful about ProLogis, noting that port-related warehousing is one of the fastest-growing industries in the region.

“Once again, we don’t know what the fate of that property will be on Staten Island, and that is something that should concern us all,” Lanza said yesterday after learning of the failed deal.

James Devine, president and chief executive of New York Container Terminal, located next to the NASCAR site, also was disappointed.

The addition of a ProLogis facility would have allowed his cargo terminal to send ship containers directly next-door for warehousing and distribution, instead of off-loading containers on site and hooking them to flatbed trucks to be sent to area stores, he said.

“We were looking at (ProLogis) not only as a neighbor, but as a business partner,” Devine said yesterday.

BAD TIMING?

Borough President James Molinaro said he had no idea why the deal fell through, but speculated that the backdrop of a credit crunch and tough real estate market may have played a role.

“This is not the best time in the world for people to come in and invest $110 million,” Molinaro said.

“Where do we go from here? I have no idea,” he added.

A few sources said yesterday that ProLogis had concerns about the price of the property, which was estimated to be between $100 and $109 million.

<!– if (parseFloat(navigator.appVersion) == 0) { document.write(”); } –>ISC paid $100 million for the site when it purchased the property for cash in 2004.

The company has spent the last several years cleaning the site, a former oil tank farm, in preparation for development, and another source said yesterday that its sheer size makes it a valuable piece.

A development team headed by Carmine Ragucci, former head of the Howland Hook Container Terminal, also bid for the NASCAR site, offering what sources said was $115 million to buy the property for another containerport.

Councilman James Oddo (R-Mid-Island/Brooklyn), who opposed the racetrack, said that the more he researched ProLogis and met with company executives, the more he liked the company.

“Deals come together and deals fall apart. It’s the business of business,” he said yesterday. “Now it’s our business that if this deal really is dead … to go back with the folks at ISC to figure out who is the best partner for Staten Island.”

Councilman Michael McMahon (D-North Shore) again called on Mayor Michael Bloomberg to step in and rezone the industrial property, as he has done with other high-profile private properties in the city.

“He is neglecting this opportunity to frame the future of this property,” McMahon said.

By Karen O’Shea

Staten Island Advance

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